Casualife Australia Pty Ltd v ANI Commercial Storage Pty Ltd
[2023] VSC 576
•28 September 2023
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST
S ECI 2023 02417
| CASUALIFE AUSTRALIA PTY LTD (ACN 638 041 022) | Applicant |
| v | |
| ANI COMMERCIAL STORAGE PTY LTD (ACN 641 819 258) | Respondent |
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JUDGE: | Tsalamandris J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 1 and 2 August 2023 |
DATE OF JUDGMENT: | 28 September 2023 |
CASE MAY BE CITED AS: | Casualife Australia Pty Ltd v ANI Commercial Storage Pty Ltd |
MEDIUM NEUTRAL CITATION: | [2023] VSC 576 |
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ADMINISTRATIVE LAW – Judicial review – Application for appeal on a question of law from a decision of Victorian Civil and Administrative Tribunal – Whether error of law in finding that proceeding was frivolous, vexatious, misconceived or lacking in substance or otherwise an abuse of process – Nature of appeal – Victorian Civil and Administrative Tribunal Act 1998, ss 148, 75(2), 75(5) – Djime v Kearnes [2019] VSC 117.
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APPEARANCES: | Counsel | Solicitors |
| For the Applicant | - | Joseph Guss |
| For the Respondent | Ms S Dhanji | Rankin Business Lawyers |
HER HONOUR:
Preliminary
This is an appeal by Casualife Australia Pty Ltd from orders of the Victorian Civil and Administrative Tribunal (VCAT or the Tribunal) dismissing an injunction application made by Casualife against ANI Commercial Storage Pty Ltd (the VCAT proceeding).
Casualife owns outdoor furniture intended for retail sale, and ANI is the owner and operator of a storage facility company.
The injunction application issued on 23 March 2023 (the relevant date) sought the release of some goods belonging to Casualife, which are currently stored by ANI.
The same parties are also involved in litigation in the County Court of Victoria. On 23 December 2022, Casualife issued a County Court proceeding against ANI seeking access to collect and remove a separate parcel of its goods from ANI’s premises (or, alternatively, an order that ANI deliver the goods to it), together with a claim for damages and costs.
On 11 May 2023, VCAT Member R Buchanan (the member) dismissed the injunction application on the basis that he was satisfied that a dispute concerning the goods the subject of the VCAT proceeding was already the subject of the County Court proceeding as at the relevant date. In those circumstances, the member held that the VCAT proceeding was vexatious and an abuse of process. In addition, the member ordered that Casualife pay ANI’s costs of the proceeding on an indemnity basis.
Casualife seeks leave to appeal the VCAT orders, and contends that, amongst other things, the member made an error of law in not finding that VCAT had exclusive jurisdiction in respect of those goods.
ANI claims that, by way of amendment to Casualife’s County Court pleadings dated 7 February 2023 (the month prior to the issue of the VCAT proceeding), both parcels of goods fell within the jurisdiction of the County Court, and the member was correct to consider the VCAT proceeding an abuse of process. Further, ANI claims that no errors of law have been identified by Casualife and leave should not be granted to review the member’s decision.
Background
From the material contained in the court book,[1] I summarise the relevant background facts to give context to my reasons for judgment. Where any of the background facts are in dispute, I note this accordingly.
[1]Although there was no formal tender of the court book, there was no objection to me having regard to the material contained within it, save for the statement of claim dated 23 December 2022 filed in the County Court proceeding. ANI objected to this on the basis that it had not been before the member. Casualife did not persist with its reliance on this document, and therefore gave no consideration to it.
There are 2 parcels of Casualife goods stored by ANI:
(i) The ex-Dandenong goods; and
(ii) The other goods.[2]
[2]ANI referred to these goods as the ‘new goods’. Casualife referred to them as the ‘current goods’ or ‘other goods’. The member referred to them as the ‘other goods’. For the ease of the reader, I use the term ‘other goods’ throughout my judgment.
The ex-Dandenong goods were initially stored at premises located in Dandenong South by another entity. ANI subsequently stored the goods pursuant to a sub‑bailment, and later moved those goods to premises in Rowville, and finally to premises in Noble Park.
On or about 30 or 31 July 2020, Casualife and ANI entered into an agreement in respect of ANI storing the other goods (July 2020 agreement).
ANI claims that, on 22 April 2022, it entered into a further agreement with Casualife which detailed the terms and conditions pertaining to the storage of the other goods (alleged April 2022 agreement).[3] ANI claims that under this agreement, ANI had a possessory and contractual lien over all of Casualife’s goods.
[3]I note that the existence and terms of the 22 April 2022 agreement are in dispute.
On 23 December 2022, the County Court proceeding was issued.
By letter dated 28 December 2022, ANI wrote to Casualife and claimed outstanding invoices, in breach of the alleged April 2022 agreement. The letter stated that ANI sought payment of the monies, together with penalty interest, recovery of costs, and further legal costs associated with the registration of ANI’s security interest on the Personal Property Securities Register (PPSR).
On the same day, Casualife replied to ANI and denied the above claim.
Soon thereafter, Casualife made an injunction application to the County Court in respect of the ex-Dandenong goods (the County Court injunction application). In written submissions in opposition to the injunction, ANI contended that Casualife’s account in relation to the other goods stored with ANI remained in debt, and as such ANI was entitled to rely on its ‘terms and conditions’, and claim a lien over all goods in its possession.
On 17 January 2023, the County Court injunction application was heard and determined by Judge Ryan. The application was dismissed, and Casualife was ordered to pay ANI’s costs.
Pursuant to orders made following the County Court injunction application, Casualife filed an amended statement of claim dated 7 February 2023. At the outset, it is worth observing that the pleading did not conform with r 36.05(4) of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) (the Rules), as not all of the amendments were made in such a way so as to enable them to be distinguished from the original pleading. Whilst some parts of the pleading were underlined so as to identify an amendment, not all of the amendments were marked in this way, and thus all amendments were not distinguishable in accordance with the Rules.
Paragraph [4] of the amended statement of claim is as follows:
Aram Khatchatrian (Aram) is the sole director and shareholder of the defendant which was incorporated by Aram on 17 June 2020 to undertake a 3PL business which it conducts. The Plaintiff and the defendant on or about 31 July 2020 entered into a 3PL agreement in respect to other goods than the Plaintiffs ex Dandenong goods (the plaintiffs current goods (which is still operating although in December 2022 a dispute has arisen as to whether purported terms and conditions said by the defendant to be dated 22 April 2022 apply thereto after that date, the plaintiff contending that they do not.
Whilst the above paragraph only has the number ‘31’ underlined (being 31 July 2020), it is implicit from the parties’ submissions that the latter part of [4], which referred to a dispute about the alleged April 2022 agreement, was an addition to the original pleading, despite it not being identified as such.
The amended statement of claim included the addition of ‘ex-Dandenong’ in front of the term ‘goods’ throughout much of the pleading.
The final paragraph of the pleading, which contained the prayer for relief, sought an order for access for collection and removal of Casualife’s goods at ANI’s premises. The prayer for relief contained no amendments and did not state that it was only the ex-Dandenong goods which would be subject to this proposed order.
On 8 March 2023, Casualife’s solicitor, Mr Joseph Guss,[4] informed ANI that Casualife intended to issue proceedings in the Magistrates’ Court for delivery up or access for removal of the other goods, on the basis of ‘wrongful detention’. Casualife claimed the stock had an at cost value of $174,000 as at that date, and sought damages, interest and costs. It also sought the consent of ANI to issue to such proceedings in the Magistrates’ Court, notwithstanding the sum claimed would be in excess of its jurisdictional limit.[5]
[4]I note, for completeness, also Casualife’s director.
[5]Magistrates’ Court Act 1989 (Vic), s 101.
On 9 March 2023, in reply, solicitors for ANI informed Casualife’s solicitor as follows:
We are instructed not to consent to the jurisdiction of the Magistrates’ Court. The question in this matter will be what terms and conditions apply in relation to the current stock. You have raised this matter in the Amended Statement of Claim filed in the County Court (paragraph 4). As you know, ANI’s position is that the terms and conditions apply to both the current stock and the stock the subject of the County Court proceeding by virtue of the lien clause.
As such, there is clearly an overlap of parties, issues, and questions. The quantum appropriately invokes the County Court’s jurisdiction, and the overlap and complexity of issues indicate that the County Court is the appropriate jurisdiction. It is, of course, a matter for the Plaintiff as to which jurisdiction a claim is brought in. Noting the overarching purpose and the parties’ obligations under the Civil Procedure Act 2010 (Vic), ANI will not consent to jurisdiction in the Magistrates’ Court in this matter.
ANI will oppose any such application, and will produce this correspondence in its response to any such application filed both for the purposes of opposing the application and costs.
On 23 March 2023, Casualife lodged a ‘goods and services application’ with VCAT, in which it sought an interim injunction for delivery up of the other goods ‘wrongfully detain[ed] in breach of contract and at law’.
The injunction application contained the incorrect address for ANI, and VCAT was not able to serve it in accordance with its usual process.
On 3 April 2023, ANI issued a defence and counterclaim in the County Court proceeding, in which it pleaded that the parties had entered into the July 2020 agreement and alleged April 2022 agreement. By counterclaim, ANI claimed that from December 2022 onwards, Casualife had fallen into arrears in respect of storage fees pertaining to the other goods, and ANI sought damages in respect of this.
On 11 April 2023, in its reply to ANI’s defence and defence to the counterclaim, Casualife admitted to the July 2020 agreement, but disputed the alleged April 2022 agreement.
On 20 April 2023, the VCAT injunction application was listed for hearing, and Casualife sought an ex parte order for delivery up of the others goods.[6] However, at the hearing of the application it became apparent to the member that ANI had not been served due to an incorrect address, and the application was adjourned to allow service to occur.
[6]Reasons, [6].
On 24 April 2023, ANI was granted leave by VCAT to issue an application for summary dismissal or strike out of the proceeding pursuant to s 75 of the Act (the s 75 application). ANI sought an order that the proceeding be dismissed on the basis that it was an abuse of process. ANI contended that a dispute concerning the goods the subject of the VCAT proceeding was also the subject of the County Court proceeding, and that the parties involved and issues raised were the same in both proceedings.
Both parties provided written submissions to VCAT in support of their respective applications. In its written submissions dated 5 May 2023, ANI relied upon the amended statement of claim, the submissions made at the County Court injunction application, and recent communications between the parties, in support of its claim that the other goods were subject to the County Court proceeding, and that there was an overlap between the issues to be determined in both proceedings. ANI submitted in the alternative that, if the member was not persuaded the County Court was properly seized of the relevant facts and matters, VCAT should exercise its power under s 77 of the Act to stay the proceeding on the basis that the dispute would be more appropriately dealt with by the County Court (the s 77 application).
In Casualife’s written submissions to the Tribunal dated 9 May 2023, it asserted that the VCAT proceeding was brought under the Australian Consumer Law and Fair Trading Act 2012 (Vic) (the ACLFTA). Casualife alleged that the July 2020 agreement remained in force, and ANI had failed to honour its terms under that agreement, and continued to be in default. It submitted that VCAT has exclusive jurisdiction in respect of consumer and trader disputes, unless, relevantly, a proceeding is commenced in a court before the application to VCAT is made, and that proceeding is still pending.[7] Casualife submitted that this exception did not apply as the VCAT proceeding had been issued before ANI had issued its counterclaim. In relation to ANI’s alternative submission pursuant to s 77, Casualife submitted that the referral should not be made on the basis that: the VCAT proceeding had been issued first; VCAT was the more appropriate forum; the presiding member was not a judicial officer; and a referral would cause substantial delay to the resolution of the dispute.
[7]ACLFTA, s 187(1).
Casualife’s injunction application and ANI’s ss 75 and 77 applications were listed for hearing by the member on 11 May 2023. It was agreed as between the parties that the ss 75 and 77 applications would proceed first.
The member’s orders and reasons for decision
At the conclusion of oral submissions, the member delivered ex tempore oral reasons dismissing the injunction application, having found that the goods the subject of the VCAT proceeding (and the relief sought) were already the subject of the County Court proceeding. The member concluded that, for those reasons, pursuant to s 75 of the Act, the VCAT proceeding was vexatious and an abuse of process.
The member stated the issue before the Tribunal was as follows:
In essence, the case comes down to deciding what is the effect of the… Amended Statement of Claim, that was filed by the Applicant in the County Court proceedings.
The member went on to find that:
But the facts of the matter that I have gleaned are that there - - while there may be two classes of goods held by the Defendant in the County Court proceeding, the problem is that the defendant refuses the Plaintiff, Casualife, access to all of them, and it’s inherently logical and plausible that Casualife would, when preparing this amended defence, have intended to (inaudible) a deal with all of its (inaudible) to the one proceeding. To not do so, would be unwise, a waste of resources of either the County Court or this Tribunal, and a waste of people’s time and energy. Many of the rules about these sorts of things, including the rules set out in Section 75 of the VCAT Act, are aimed at precisely avoiding that kind of waste of energy and resources. These things would be known to an experienced practitioner like Mr Guss through the amended Statement of Claim, and, quite reasonably, were understood by the Defendant in the County Court proceeding to place the whole kit and caboodle in issue, which is where it should have been, and the Defendant in the County Court proceeding was quite entitled, in my view, to see that there was, clearly stated, a dispute in relation to what we might call a second class of goods, the new goods.
After the member delivered reasons for dismissing the injunction, ANI sought its costs of the application pursuant to s 75(2) of the Act. This application was resisted by Casualife, and it made submissions as to why there was no basis for an award of indemnity costs.
The member ruled that Casualife would be ordered to pay ANI’s costs on an indemnity basis. In his oral costs ruling, the member noted that under s 109(2) of the Act, VCAT may award costs if it is fair to do so, having regard to a number of factors under s 109(3). The member said he was satisfied there had been a ‘wilful disregard of known facts,’[8] as the VCAT proceeding should not have been brought, and was an abuse of process. The member thereafter ordered that Casualife pay ANI’s costs on an indemnity basis.
[8]Colgate-Palmolive v Cussons (1993) 46 FCR 225, 233.
The member’s orders of 11 May 2023 were as follows:
FINDINGS
1. The goods which are the subject of this proceeding and the relief sought are also the subject of a proceeding by the applicant against the respondent, in the County Court at Melbourne number CL-22-05656.
2. The VCAT proceeding is vexatious and is an abuse of process.
ORDERS
1. The proceeding is dismissed.
2. The applicant must pay the respondent's costs on an indemnity basis, to be assessed by the Victorian Costs Court, in default of agreement.
(order 1)
On 15 May 2023, ANI made a request for written reasons of the member’s decision, pursuant to s 117(2) of the Act.
On 21 June 2023, the member provided his written reasons. In these reasons, the member explained that he dismissed the injunction on the basis that both the VCAT proceeding and the County Court proceeding were in respect of the same parties, the same subject matter (being the other goods), and raised the same issues. The member expressly noted that both parcels of goods were referred to at [4] of the amended statement of claim, and that Casualife’s prayer for relief was in relation to all of its goods in the possession of ANI.
The member observed what had been pleaded by ANI in its defence and counterclaim (as previously mentioned at [27] above), and noted that it had been filed in the County Court prior to ANI being made aware of the VCAT proceeding. Further, the member considered it relevant that ANI’s claim to a lien over all of Casualife’s goods was known to Casualife prior to commencing the VCAT proceeding, and specifically referred to the first paragraph of correspondence from ANI of 9 March 2023.[9] The member found that both proceedings dealt with, in part, the same issue, namely whether ANI enjoyed a lien over the other goods. The member considered it reasonable to assume that, having claimed such a lien over the other goods in the County Court proceeding, ANI would have made a similar claim in the VCAT proceeding if it had been required to file a Points of Defence.
[9]See [24] above.
In addition, the member held that Casualife had failed to bring its claim under the ACLFTA, as the document filed at VCAT made no reference to the ACLFTA, and had merely identified breach of contract, detinue, and damages for breach on its application form. In the alternative the member found that, even if Casualife had brought its claim under the ACLFTA, VCAT would not have had exclusive jurisdiction under s 187 of the ACLFTA, as the County Court proceeding was commenced before the VCAT proceeding was issued.
In view of the above, and ‘in the absence of any rational reason’ why the VCAT proceeding had been brought or should have continued, the member dismissed the proceeding as vexatious and an abuse of process.
The written reasons also detailed the member’s reasons for ordering that Casualife pay ANI’s costs on an indemnity basis. The member stated that as he had dismissed Casualife’s application under section 75 of the Act, an order may be made under s 75(2) of the Act. The member noted that the purpose of a costs order under s 75(2) was to provide compensation referrable to a party’s costs, expenses and loss resulting from the proceeding, and accordingly he ordered Casualife pay ANI’s costs on an indemnity basis.
Following delivery of those written reasons, updated orders were made by the member on 21 June 2023 (order 2). These orders were in the same terms as order 1, save that they included catchwords, and a new ‘date of reasons’, being 21 June 2023.
On 27 June 2023, the Tribunal issued corrected orders dated 26 June 2023 (order 3).
Order 3 was as follows:
Findings
1. The goods which are the subject of this proceeding and the relief sought are also the subject of a proceeding by the applicant against the respondent, in the County Court at Melbourne number CI-22-05656.
2. The VCAT proceeding is vexatious and is an abuse of process.
Orders
1. Each party has leave to be represented by a legal practitioner.
2. The proceeding is dismissed.
3. The applicant must pay the respondent's costs to be assessed by the Victorian Costs Court on an indemnity basis under the County Court scale.
On the same day, identical orders to order 3 were issued, save for with addition of catchwords (order 4).
In support of Casualife’s appeal, Mr Guss swore an affidavit dated 13 June 2023, in which he exhibited a number of documents pertaining to the VCAT proceeding, including written submissions and transcript of the hearing, together with a copy of the amended statement of claim.
In this affidavit, Mr Guss said that ‘on any proper reading’ it was ‘clear’ that the amended statement of claim related to the ex-Dandenong goods only. He said that the phrase ‘plaintiff’s goods’ had been amended to read ‘the plaintiffs ex Dandenong goods’ throughout the pleading, save for in the prayer for relief. Mr Guss stated that he had prepared and typed the amended statement of claim and his failure to add the words ‘ex Dandenong goods’ to the prayer for relief was due to an ‘omission by typing’. Mr Guss said that he had intended to add those words to the prayer for relief, as he had in the foregoing paragraphs of the amended statement of claim.
Casualife’s claimed errors of law and grounds of appeal
I set out in full Casualife’s questions of law and proposed grounds of appeal:
The questions of law are:
Under all four above orders:
1. whether under S. 75(5) of the VCAT Act the VCAT proceeding was vexatious and an abuse of process, or not, the Appellant contending that it was not.
2. Whether or not having regard to the provisions of S.109 of the VCAT Act the costs orders against the applicant was properly made, the applicant contending that it was not.
Under the third and fourth orders:
3. Whether under S.119 of the VCAT Act or otherwise at law, the orders therein were permissible to be made or valid, the applicant contending that they were not.
4. Whether under S. 117 of the VCAT Act or otherwise at law, the reasons referred to therein (and the second order) and attached thereto were permissible to be given having regard to the ex tempore decision delivered at the time of the making of the first order, the applicant contending that they were not.
Under the third and fourth orders:
5. Whether having regard to the provisions of S.119 of the VCAT Act or otherwise at law, and the extempore decision of 11 May 2023 and the first and/or second order it was permissible the make
(a)Order 1 of the third order that ‘Each party has leave to be represented by a legal practioner’, the applicant contending that it was not.
(b)Amend Order 2 of the first and second orders by stating as Order 3 therein ‘The applicant must pay the respondents costs to be assessed by the Victorian Costs Court on an indemnity basis under the County Court Scale’ in lieu of the wording of Order 2 of the first and second orders, the applicant contending that it was not.
The proposed grounds of appeal are:
1. The Learned Member erred in finding that the goods which are the subject of the VCAT proceeding and the relief sought are also the subject of a proceeding by the applicant (the Appellant herein ) against the respondent (The Respondent herein), in the County Court at Melbourne number Cl-22-05656( the County Court proceeding), and should have found that the said goods were not the subject of the Appellants claim in the County Court proceeding. but in the VCAT proceeding.
2. The Learned Member erred in finding that the VCAT proceeding is vexatious and is an abuse of process, and should have found that it was not.
3. The Learned Member erred in not finding in the extempore decision of 11 May 2023, as contended the Appellant in the VCAT proceeding that VCAT had jurisdiction to hear and determine the Appellants claim for delivery up by the respondent to the applicant, or for the respondent to provide access for removal of the applicants goods the subject of the VCAT proceeding to the applicant, and otherwise as claimed by the Appellant applicant therein.
4. The Learned Member was not permitted under S.117 of the VCAT Act or otherwise at law to give the Reasons he did dated 21 June 2023 having regard to them differing from the ex tempore decision given on 11 May 2023 although for the reasons given herein the applicant contends that his findings therein were in any event incorrect.
5. The Learned Member was not permitted under S.119 of the VCAT Act or otherwise at law to amend or ‘correct’ the first and/or second orders by making the third and fourth orders having regard to the making of the first orders following the delivery of his ex tempore decision on 11 May 2023 although for the above reasons the applicant contends that in any event he was incorrect in doing so.
Appeal of a VCAT decision on a ‘question of law’
Pursuant to s 148(1) of the Act, a party may only appeal an order of VCAT on a question of law and with leave of the Court.[10] In addition, pursuant to s 148(2A) of the Act, leave to appeal may only be granted if the Court is satisfied that the application for leave has a real prospect of success.[11]
[10]In relation to an order of a member who is not the President or a Vice President of VCAT, the party requires leave of the Trial Division of the Supreme Court: The Act, s 148(1)(b).
[11]The Act, s 148(2A); See also, for example, Mendes v Baptcare [2019] VSC 790, [16].
Also relevant to this application, s 75(5) of the Act provides:
For the purposes of this Act, the question whether or not an application is frivolous, vexatious, misconceived or lacking in substance or is otherwise an abuse of process is a question of law.
Casualife submitted that pursuant to this subsection, the member’s decision to dismiss the proceeding as an abuse of process was deemed to be a question of law, which warrants a grant of leave to appeal the member’s decision.
ANI submitted that s 75(5) did not change the intention of the operation of s 148, that being one of judicial review. It was put that s 75(5) merely clarifies that there is a question of law for an appeal. It was submitted that, on this view, the question for the Court remained whether it was open to the member, on the facts before it, and acting on a reasonable and proper understanding of the law, to find as he did.
ANI submitted that, if to the contrary I accepted that s 75(5) allowed some form of merits review, then it must be by way of a rehearing, and not de novo hearing, so as to prevent there being new evidence before the court that was not before VCAT. ANI submitted, if reviewed in that way, the court is required to answer ‘whether on the facts found by VCAT the court considers for itself that the VCAT injunction application was vexatious and an abuse of process.’
It is relevant to note the decision in Djime v Kearnes,[12] which involved an application for leave to appeal the summary dismissal of claims at VCAT. In considering whether VCAT made any relevant error which would warrant a grant of leave to appeal, Cavanough J made the following observation:
As will be seen, in considering whether VCAT may have made any ‘relevant error’ in its first decision, it has occurred to me that the combined effect of s 75(5) and s 148 of the VCAT Act may be that, in relation to challenges to decisions made by VCAT upon summary dismissal applications made under s 75 of the VCAT Act, the true issue for the Court may not be whether VCAT made some specific error of law but rather whether VCAT’s decision on the summary dismissal application was the correct or preferable one …[13]
[12][2019] VSC 117.
[13]Ibid [7].
It was not necessary for Cavanough J to decide the nature of such an appeal, as the parties had not made submissions to him in respect of it and he determined that, on either view, the application for leave should be refused.
Here, it is also not necessary for me to determine the nature of such an appeal by virtue of s 75(5). Whether Casualife’s application is confined to an appeal on a question of law in the nature of judicial review,[14] or considered in the way contemplated in Djime v Kearnes (whether the member’s decision was the correct or preferrable one), the outcome is the same. For the reasons that follow, I am satisfied that the member erred in dismissing the VCAT proceeding as an abuse of process and that leave to appeal should be granted.
[14]Osland v Secretary, Department of Justice (No 2) (2010) 241 CLR 320, 331–3 [18]–[21].
Casualife’s submissions
Casualife’s main complaint was that the VCAT proceeding was commenced before the claim in respect of the other goods was raised by ANI in its defence and counterclaim in the County Court, thus VCAT had exclusive jurisdiction, and the member’s dismissal of the VCAT proceeding on the ground that it was an abuse of process was an error of law.[15]
[15]Question of law 1, and grounds 1, 2, 3 and 7(a) and (b).
Casualife claimed that under the ACLFTA, VCAT had exclusive jurisdiction to hear and determine a consumer and trader dispute, unless, relevantly, proceedings were commenced in a court before any application to VCAT.[16] Casualife submitted that the member was wrong to find that a dispute concerning the other goods was before the County Court proceeding at the time the VCAT proceeding was issued.
[16]ACLFTA, s 187.
In support of this submission, Casualife said that matters referred to in [4] of the amended statement of claim were not material to the pleading. Further, Mr Guss contended that the reference to the other goods, ‘[p]robably … shouldn’t have been mentioned’ in that document.
In respect of the prayer for relief, Casualife submitted that it was ‘clearly’ intended to be in respect of the ex-Dandenong goods only, not all of its goods. Casualife sought to rely upon Mr Guss’ affidavit of 13 June 2023, and submitted that the Court should be satisfied the absence of the words ‘ex-Dandenong goods’ in the prayer for relief was a mere a typographical error.
Casualife referred me to the decision of John Dixon J in Wheelahan & Anor v City of Casey & Ors (No 12)[17] to support its contention that the member should not have been concerned with typographical errors in its amended statement of claim,[18] and that it was permissible to disregard parts of pleadings which are not material facts, and do not disclose a cause of action.[19] Casualife relied on this decision to support its allegation that the member’s finding that the County Court pleading included the other goods, not just the ex-Dandenong goods, was an error of law.
[17][2013] VSC 316.
[18]Ibid [21].
[19]Ibid [25].
Further, Casualife submitted that the member was in error in referring to ANI’s defence and counterclaim, as these were filed in the County Court subsequent to the issue of the VCAT proceeding and were thus irrelevant to his determination.
ANI’s submissions
In reply, after making a coverall objection that Casualife failed to identify a proper question of law or ground of appeal, ANI submitted that it was open to the member to accept that a dispute concerning the other goods fell within the County Court’s jurisdiction as at the relevant date, as it was pleaded as a material fact in the amended statement of claim. It was said that this finding was supported by communications between the parties prior to that amendment, including the submissions made at that County Court injunction application, and in ANI’s response to Casualife’s proposal that it issue a proceeding in the Magistrates’ Court. Further, it was put that the counterclaim filed subsequent to the VCAT proceeding confirmed that a dispute concerning the other goods was covered by the County Court proceeding.
Analysis
Section 75(1) enables a VCAT proceeding to be dismissed if it is frivolous, vexatious, misconceived or lacking in substance or is otherwise an abuse of process. Pursuant to s 75(5), this is a question of law. Relevant to this application, the member was required to consider whether, on the relevant date, the County Court was already seized of matters concerning the other goods which were intended to be the subject of the VCAT proceeding.
It is apparent from the member’s oral and written reasons that his decision to dismiss the VCAT proceeding was based upon his finding that the pleadings within the amended statement of claim were such that the County Court was seized of the disputes pertaining to both parcels of goods prior to the issue of the VCAT proceeding. The member’s finding was in error for the following reasons.
First, contrary to what the member found, a proper consideration of the communications between the parties prior to the relevant date, supports Casualife’s contention that the amended statement of claim did not cover a dispute concerning the other goods.
When the statement of claim was first issued on 23 December 2022, it did not delineate between the two parcels of goods, as at that time Casualife was not on notice of a dispute being raised by ANI in relation to the other goods, and it had not raised such a dispute itself. It can be deduced from the amended statement of claim that in its original pleading, Casualife’s County Court proceeding was based upon a claim by Casualife that goods that had previously been stored by another entity, were now being stored by ANI at premises in Rowville which constituted an unlawful interference with Casualife’s goods. The statement of claim contained a schedule that itemised all such goods.
It was only on 28 December 2020, when ANI wrote to Casualife and alleged a breach of contract pertaining to other goods stored by it, that a second dispute between the parties was raised. The submissions filed by ANI in the County Court injunction application confirmed its position in relation to that separate dispute.
It was at this time, knowing of the two separate disputes over two separate parcels of goods, that Casualife amended its statement of claim and added the words ‘ex‑Dandenong goods’, save for in the prayer for relief. This amendment was responsive to the situation pertaining to the parties at that time, that is, the need to clarify which of Casualife’s goods were the subject matter of the County Court proceeding. Save for the reference to a dispute concerning the other goods in [4], a plain reading of the pleading is that the County Court proceeding was only in relation to the ex-Dandenong goods.
Thereafter, Casualife expressly informed ANI it intended to issue a separate proceeding in relation to the other goods in the Magistrates’ Court. ANI’s response to this was that a dispute pertaining to those goods had been ‘raised’ in [4] of the amended statement of claim, and there was already an overlap between the parties, issues and questions, such that the County Court was the appropriate forum. In this letter, ANI stated that it was a matter for Casualife to decide ‘as to which jurisdiction a claim is brought in.’ This acknowledgment by ANI supports a finding that at the relevant date, the dispute concerning the other goods was not within the jurisdiction of the County Court.
Second, the amended statement of claim, when considered as a whole, does not support the member’s finding that it covered a dispute concerning the other goods. To understand this conclusion, it is worth restating the general principles of pleadings outlined by Dixon J in Wheelahan relevant to this proceeding:
(a)Order 13 of the Rules set out the relevant requirements of a sufficient pleading, while r 23.02 provides the grounds on which the sufficiency of a pleading may be impugned;
(b)the function of a pleading in civil proceedings is to alert the other party to the case they need to meet (and hence satisfy basic requirements of procedural fairness) and further, to define the precise issues for determination so that the court may conduct a fair trial;[5]
(c)the cardinal rule is that a pleading must state all the material facts to establish a reasonable cause of action (or defence). The expression ‘material facts’ is not synonymous with providing all the circumstances. Material facts are only those relied on to establish the essential elements of the cause of action;
(d)as a corollary, the pleading must be presented in an intelligible form – it must not be vague or ambiguous or inconsistent. Thus a pleading is ‘embarrassing’ within the meaning of r 23.02 when it places the opposite party in the position of not knowing what is alleged;
(e)the fact that a proceeding arises from a complex factual matrix does not detract from the pleading requirements. To the contrary, the requirements become more poignant;
(f)pleadings, when well-drawn, serve the overarching purpose of the Civil Procedure Act 2010 (Vic);
(g)a pleading which contains unnecessary or irrelevant allegations may be embarrassing – for example, if it contains a body of material by way of background factual matrix which does not lead to the making out of any defined cause of action (or defence), particularly if the offending paragraphs tend to obfuscate the issues to be determined;
…
(i)every pleading must contain in a summary form a statement of all material facts upon which the party relies, but not the evidence by which the facts are to be proved (r 13.02(1)(a));
…
(k)particulars are not intended to fill gaps in a deficient pleading. Rather, they are intended to meet a separate requirement – namely, to fill in the picture of the plaintiff’s cause of action (or defendant’s defence) with information sufficiently detailed to put the other party on guard as to the case that must be met. An object and function of particulars is to limit the generality of a pleading and thereby limit and define the issues to be tried;
(l)a pleading should not be so prolix that the opposite party is unable to ascertain with precision the causes of action and the material facts that are alleged against it;
…[20]
[20]As above (n 17) [25].
The amended statement of claim may be seen as containing many of the embarrassing pleadings as identified above. Such failures may have improperly distracted the member from the critical matter the member was required to decide – whether or not, the County Court was seized of a dispute concerning the other goods at the relevant date. The mere reference in [4] of the amended statement of claim to a dispute arising in December 2022 in relation to the terms and conditions under which other goods were stored by ANI, was insufficient to identify a cause of action. This reference in [4] goes nowhere, is unnecessary and irrelevant to the pleadings. It ought have been identified as such by the member.
The member erred in finding the prayer for relief covered the other goods. The amended statement of claim expressly identifies the claim as pertaining to the ex-Dandenong goods. There was no suggestion the schedule attached to the amended statement of claim had also been amended to itemise the other goods. In the absence of a cause of action in the pleading in respect of the other goods, there is no consequence for the failure of Casualife to expressly state the prayer for relief was confined to the ex-Dandenong goods.
In making this finding that the member was in error, it has not been necessary for me to consider the contents of Mr Guss’ affidavit, in which he asserts that the failure to add the words ‘ex-Dandenong goods’ to the prayer for relief was a typographical error. I note that in an application under s 148, fresh evidence is not ordinarily admitted in relation to the substantive issues determined on a s 75 application.[21] However, there is no need for me to rule on this, as even without Mr Guss’ purported explanation, on a plain reading of the amended pleading, the other goods were not capable of being the subject of the prayer for relief.
[21]As above (n 12) [127].
Third, ANI’s counterclaim and defence was filed after the relevant date and was therefore irrelevant to the member’s decision as to whether the County Court was seized of the other goods at the time the VCAT proceeding was issued.
The member’s reasoning as to why the proceeding was vexatious and an abuse of process, may well have been relevant and highly persuasive as to the alternative s 77 application. However, the member never came to decide that application. Further, as was noted by Casualife at the time of the hearing, the member was not a judicial officer and therefore did not have the power to make such an order.
In any event, the question relevant to this appeal is whether the member’s decision to dismiss the VCAT proceeding pursuant to s 75 was in error of law. For the reasons explained above, I am satisfied that question of law 1, and grounds of appeal 1 and 2, should be determined in favour of Casualife. I am satisfied that leave to appeal should be granted and the appeal allowed.
Given Casualife has succeeded in respect of its primary ground of appeal, it is not necessary for me to consider its allegations in relation to the written reasons, and the member’s amendment to his orders. Further, the grounds of appeal which relate to the member’s costs order are also not necessary for me to determine.
I will hear from the parties as to the precise form of orders to give effect to these reasons, and as to costs.
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