Chapman v Bellbird Workers Club Limited

Chapman brought a claim against Bellbird Workers Club Limited, which was settled, and judgment was entered in the club's favour. Bellbird then brought a cross-claim against the club, which was dismissed on the basis that Bellbird had lost its rights by failing to bring the cross-claim sooner. Bellbird now sought to set aside the orders made on settlement of Chapman's claim against the club. The court was required to determine the principles that should be applied in deciding whether to set aside orders made on settlement of a claim. It was also required to consider whether Bellbird had lost its rights to bring the cross-claim and whether setting aside the orders would cause irremediable prejudice to the club.

The court found that in determining whether to set aside orders made on settlement of a claim, it should consider the reasons why the party did not bring the cross-claim sooner and whether setting aside the orders would cause irremediable prejudice to the other party. In this case, Bellbird had not brought the cross-claim sooner because it had not realised that it had a potential claim against the club. The court found that setting aside the orders would not cause irremediable prejudice to the club because the club had not yet incurred any costs or expenses in defending the claim. The court also found that Bellbird had not lost its rights to bring the cross-claim because it had not acted unreasonably in delaying in bringing the cross-claim.

The court set aside the orders made on settlement of Chapman's claim against the club for the limited purpose of allowing the court to determine the cross-claim brought by Bellbird against the club. The court dismissed the club's motion and ordered Bellbird to pay the club's costs of both motions, and Chapman to pay her own costs. The hearing date was vacated, and the proceedings were listed for a status conference. Costs occasioned by the adjournment were reserved.