Cheng v Commonwealth Bank of Australia - [2022] WASCA 125

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT :   THE COURT OF APPEAL (WA)
CITATION:   CHENG -v- COMMONWEALTH BANK OF AUSTRALIA [2022] WASCA 125
CORAM:   MITCHELL JA
BEECH JA
BLEBY AJA

HEARD:   14 SEPTEMBER 2022
DELIVERED          :   14 SEPTEMBER 2022
PUBLISHED           :   23 SEPTEMBER 2022
FILE NO/S:   CACV 83 of 2021
BETWEEN:   MARY YUEN SHAN CHENG
Appellant
AND
COMMONWEALTH BANK OF AUSTRALIA
First Respondent
FRANCIS HUNG LAM
Second Respondent
ANDREA MAN YEE CHENG
Third Respondent
CHAN THANH LAM
Fourth Respondent

ON APPEAL FROM:
Jurisdiction              :   SUPREME COURT OF WESTERN AUSTRALIA
Coram:   SMITH J
File Number            :   CIV 2563 of 2013

Catchwords:

Practice and procedure - Strike out application - Abuse of process - Approbation and reprobation - Where in other proceedings parties held to have formed a series of partnerships for the development and sale of various properties - Where parties borrowed from the respondent bank to finance the development of those properties - Where an account between the parties was ordered to be taken before a registrar in the other proceedings on the basis that the parties' entitlement to a share in the partnership properties arose in part due to joint borrowings from the respondent bank - Where appellant pleaded in the primary proceedings that she was not liable for some borrowings - Where judge struck out pleadings on basis of abuse of process alternatively based on the doctrine of approbation and reprobation - Whether trial judge erred in not granting leave to replead in circumstances where no leave to replead was sought - Whether trial judge made an implicit finding of fact that all of the borrowings were the subject of findings in the other proceedings

Legislation:

Nil

Result:

Leave to appeal refused
Appeal dismissed
Appellant pay the respondents' costs of the appeal, to be assessed if not agreed

Category: B

Representation:

Counsel:

Appellant	:	M A Tedeschi & P J Hannan
First Respondent	:	M D Cuerden SC & S C M Wong
Second Respondent	:	P G McGowan
Third Respondent	:	P G McGowan
Fourth Respondent	:	No appearance

Solicitors:

Appellant	:	G A Lacerenza & Associates
First Respondent	:	Dentons Australia
Second Respondent	:	Johnstone Crouse Lawyers
Third Respondent	:	Johnstone Crouse Lawyers
Fourth Respondent	:	No appearance

Case(s) referred to in decision(s):

ABC (a pseudonym) v Reader Lawyers & Mediators [2021] WASCA 202
Cheng v Lam [No 2] [2018] WASC 199
Cheng v Lam [No 2] [2021] WASCA 196
Cheng v Lam [No 3] [2020] WASC 45
Cheng v Lam [No 4] [2020] WASC 175
Commonwealth Bank of Australia v Cheng [No 2] [2021] WASC 291
Commonwealth Bank of Australia v Cheng [No 2] [2021] WASC 291 (S)
House v The King (1936) 55 CLR 499
Macedonian Orthodox Community Church St Petka Incorporated v His Eminence Petar The Diocesan Bishop of The Macedonian Orthodox Diocese of Australia and New Zealand [2008] HCA 42; (2008) 237 CLR 66

REASONS OF THE COURT:

Introduction

After hearing the appellant's argument in this appeal, the court made the following orders:
1.leave to appeal is refused;
2.the appeal is dismissed; and
3.the appellant is to pay the respondents' costs of the appeal, to be assessed if not agreed.

The court said that it would publish reasons for these orders later. These are our reasons.

Summary

The appellant (Mary)[1] seeks leave to appeal against the primary judge's decision[2] refusing leave to file a proposed substituted defence and counterclaim dated 29 January 2021 (the impugned pleading) and striking out the then existing pleading (the re-amended statement of defence and counterclaim dated 21 December 2017), with leave to replead refused.
[1] As in the primary proceedings and as the parties have done, we will refer to the parties by their first name. No disrespect is intended.
[2] Commonwealth Bank of Australia v Cheng [No 2] [2021] WASC 291 (primary reasons); Commonwealth Bank of Australia v Cheng [No 2] [2021] WASC 291 (S).
In order to understand the basis on which the primary judge struck out Mary's pleadings in the primary proceedings, and refused leave to replead, it is necessary to understand the history of other proceedings, which were commenced by Mary, and to understand the relationship between those proceedings and the primary proceedings.
In the primary proceedings, commenced in 2013, the first respondent (the Bank) sued four defendants, who were partners in partnerships for the purchase, development and sale of properties. The four partners were Mary; the fourth respondent (Chan), who was Mary's former husband; the second respondent (Frank) and the third respondent (Andrea), who are husband and wife. Frank is Chan's brother. In the primary proceedings, the Bank sought amounts owing pursuant to two loan agreements and accompanying mortgages, and possession of two properties.
Mary commenced separate proceedings (CIV 1706 of 2015) (the Partnership proceedings) contending that Frank and Andrea, with Chan and Mary, developed various properties pursuant to an oral partnership agreement. Mary sought a declaration of the existence of the partnership and an account. The Partnership proceedings were heard before Chaney J, who made findings as to the terms of the parties' agreements to develop the properties.[3] Broadly summarised, Chaney J found that the parties had entered into separate agreements for each property and ordered that an account be taken before a registrar. His Honour ordered that, in taking the account, the proceeds of sale of any partnership property were to be applied, first, to the payment of any mortgages over the properties.
[3] Cheng v Lam [No 2] [2018] WASC 199 (partnership reasons).
That account was taken by Registrar Whitbread.[4] The registrar held, contrary to Mary's contention, that the account was to be taken in common form and not on the basis of wilful default or breach of fiduciary duty.[5] The taking of the account extended over nine days.
[4] Cheng v Lam [No 3] [2020] WASC 45.
[5] Cheng v Lam [No 3] [13] - [14].
Tottle J adopted the registrar's report, save in one specific respect.[6] This court refused Mary's application for leave to appeal against that decision.[7]
[6] Cheng v Lam [No 4] [2020] WASC 175 [64].
[7] Cheng v Lam [No 2] [2021] WASCA 196.
In very broad summary, in the impugned pleading in the primary proceedings, Mary claimed against the Bank on the basis that the proceeds from the development and sale of the properties should not have been used to fund other developments. She claimed that she had no liability to the Bank for some of the borrowings necessary to fund the developments and counterclaimed for breach of contract, unjust enrichment, unconscionable conduct and the Bank's failure to mitigate its loss.
Against Frank and Andrea, Mary pleaded that they breached their fiduciary duties, obligations under s 40(1) of the Partnership Act 1885 (WA) and engaged in unconscionable conduct contrary to s 11A of the Fair Trading Act 1987 (WA) and s 18 and s 19 of the Fair Trading Act 2010 (WA) by, in essence, failing to apply proceeds from the sale of partnership properties against amounts owing to the Bank or in repayment of the judgment sum in respect of the Bank's judgment against Frank, Andrea and Chan.
Again in broad summary, the primary judge struck out the impugned pleading as an abuse of process because it pleaded matters that directly contradicted findings and final orders made by Chaney J in the Partnership proceedings and because it pleaded matters that ought reasonably to have been raised, if at all, in the Partnership proceedings. Further or alternatively, the primary judge found that it was impermissible for Mary to approbate her pleaded position and conduct in the Partnership proceedings, in which she had taken the benefit of the judgment, and then reprobate by her pleas in the primary proceedings.
The appellant seeks leave to appeal against the primary judge's refusal of leave to replead. She advanced four grounds, but in substance there were two complaints. First, she contends that the primary judge's decision was an unreasonable exercise of discretion in that, in circumstances where this was the Bank's first strike‑out application since Tottle J's orders, the primary judge should have allowed Mary at least one opportunity to formulate a pleading that was not inconsistent with anything in Chaney J's reasons.
Fatal to this ground is that, before the primary judge, the appellant did not at any stage seek leave to replead. On appeal, ultimately Mary's counsel properly accepted that the judge could not be said to have erred in failing to exercise her discretion to make an order not sought by the appellant.
Secondly, by grounds 2, 3 and 4, the appellant contends that the primary judge should not have been satisfied, to the high level necessary for the purposes of summary disposal, that at least some of the funds claimed in the primary proceedings were not the subject of consideration in Chaney J's reasons or in the taking of accounts that followed his Honour's orders. Those grounds are founded on the appellant's contention that the primary judge implicitly found that all of Mary's complaints in the impugned pleading were the subject of Chaney J's reasons and thus the registrar's report.
In our view a plain reading of the reasons demonstrates that the primary judge made no such finding. Rather, her Honour observed that some of the matters were the subject of Chaney J's reasons, but, more significantly, that the complaints sought to be advanced in the impugned pleading should have been raised in the Partnership proceedings. Consequently, grounds 2 ‑ 4 fail.
Our more detailed reasons for making the orders in [1] above follow.
We begin by outlining the course of the Partnership proceedings.

The Partnership proceedings

In the Partnership proceedings, Mary claimed a 'full and general account … of all assets, money, debtors liabilities and credits'.[8] At a directions hearing four months before the trial occurred, both parties accepted that it was neither appropriate nor practical for the court to engage in the process of preparing a full and general account. Rather, they accepted that the principal issue at trial would be as to the terms of the agreement or agreements under which the property development proceeded and as to whether there was a liability on any party to account in relation to the projects on the basis of those agreements. The preparation and settling of the account itself was, the parties agreed, a matter to be undertaken subsequent to the trial in the light of the findings made at trial.[9]
[8] Partnership reasons [12].
[9] Partnership reasons [12].
In response to Chaney J's request, at the commencement of the trial, for an agreed statement of the issues, the parties provided competing lists. Mary's list comprised nine issues, the first two of which were also raised by the defendants. The additional seven issues identified by Mary were in the following terms:
(3)How each property purchase was funded by the parties including:
(a)[i]ndividual cash contributions by the parties;
(b)[b]ank funding;
(c)[u]se of sale proceeds made by the parties from the sale of developed land;
(d)[r]epayment of any loans taken out to fund the purchase and development of the properties;
(e)[t]he repayment of interest on any loans taken out to fund the purchase and development of the property;
(f)[w]hether the parties made a contribution towards the purchase of the properties as a result of the matters referred to in paragraphs 3(a) to (e) above.
(4)How each property development was funded by the parties including:
(a)[i]ndividual cash contributions by each of the parties;
(b)[b]ank funding;
(c)[u]se of sale proceeds made by the parties from the sale of developed lots;
(d)[r]epayment of any loans taken out to fund the purchase and development of the properties;
(e)[t]he repayment of interest on any loans taken out to fund the purchase and development of property;
(f)[w]hether the parties made a contribution towards the purchase of the properties as a result of the matters referred to in paragraphs 4(a) to (e) above.
(5)Whether in breach of the Partnership Agreement the First and Second Defendant drew monies from four Commonwealth Bank accounts numbers 702643203, 10747764, 422911904 and 511031108 and paid them into the Commonwealth Streamline saver personal account 100547872 in the names of the First and Second Defendants and, if they did, the amount they drew.
(6)The destination and application of the settlement proceeds in respect to all the properties purchased and subsequently developed.
(7)The application of the net proceeds of sale paid to the parties after the development of the properties when those funds were paid and to who[m.]
(8)Whether the parties received the transfer of a property or properties in specie from the net proceeds of the development of the eight properties and, if so, when and in what proportions.
(9)Whether the First and Second Defendants received monies which were the property of the Plaintiff because of the sale and the settlement of sale of 8A Spencer Avenue and 17 Darch Street, Yokine and, if so, the amounts.
Chaney J found that while some of those issues were relevant to the determination of the nature and terms of the agreements under which the property developments proceeded, for the most part the matters raised by Mary were issues to be resolved in the context of the taking of an account by a registrar.[10]
[10] Partnership reasons [17]; primary reasons [61].
Chaney J found that eight properties were developed under partnership agreements: 17 Darch Street, Yokine; 73 Main Street, Osborne Park; 111 Shakespeare Avenue, Yokine; 78 Edgecumbe Street, Como; 167 and 167A Lockhart Street, Como; 70 Edgecumbe Street, Como; 250 Ewen Street, Woodlands; and 82 and 84 Matlock Street, Mount Hawthorn.
Chaney J's conclusions as to the existence and terms of the partnership agreements may be summarised as follows.
Mary, Chan, Andrea and Frank agreed to jointly purchase and develop eight investment properties from time to time as investment opportunities were identified. Contrary to Mary's submission, Chaney J found that there was no single partnership between those parties on the terms pleaded by Mary. Rather, the parties to each venture, and the relative interests those parties held in the venture, were agreed in relation to each specific venture. Broadly, the agreements were to purchase, develop, and sell the properties. Other than as to the division of profit, the terms of those agreements were as pleaded by Frank and Andrea.[11]
[11] Partnership reasons [109], [114]. See also primary reasons [39] - [40].
The terms of the partnership agreements were generally as follows. The proceeds realised from the sale of the property would be applied, first, against any borrowings used to purchase the property; second, against any costs incurred in purchasing and developing the property, third; against any amounts paid by any of the participants towards the maintenance or development of the properties; and, finally, the balance was to be distributed between the participants in accordance with their respective interests in the property at the time of purchase.[12]
[12] Partnership reasons [114].
Chaney J ordered that an account be taken. The proceeds were to be first applied to the payment of any mortgage over the properties.[13]
[13] Partnership reasons [134(1)].
The primary judge considered the following conclusions drawn by Chaney J in the Partnership reasons to be significant:[14]
(1)Mary and Chan joined in the borrowing necessary to undertake the purchases on the basis that that would entitle them to the agreed share of the project, including their proportionate share of the profit. His Honour rejected the evidence of the defendants to the effect that the profit was to be shared on the basis of contribution where contribution means only funds advanced towards a project other than by way of joint borrowings.[15]
(2)As between Frank and Chan or Mary, it is clear that Frank assumed responsibility for payment of some expenses such as interest on borrowings and outgoings on the properties and appears to have met a far greater proportion of those expenses than did Chan or Mary. Further, his Honour found, it may well be that Frank made those payments using sums from accounts containing proceeds of the sale of properties to which Mary and Chan had some entitlement - for example from the sale of units from the Shakespeare Avenue property, and 17 Darch Street.[16]
(3)In cross‑examination, Mary asserted that capital contributions were contributed equally through borrowing but accepted that if one party were to contribute a lesser amount of capital than the others, then that party would receive a lesser share of the profit.[17] She also said when cross‑examined that, 'We said that we will borrow equally and will contribute equally'.[18] By this evidence her references to 'capital' and 'contribution' should be construed as a reference to joint borrowings.[19]
(4)The terms upon which each of the eight property investments proceeded were those pleaded by the defendants save as to the method of division of profit. That is, any proceeds realised from the sale of the relevant property was to be applied first in payment of any borrowings used to purchase or develop the property; second, in payment of all costs and expenses incurred in the purchase and development of the property; and third, in repayment of any amounts paid by any of the participants towards the maintenance or development of the properties. Any balance then remaining was to be divided between the participants to the project in proportion to each of their interests registered against the title to the project property at the time of its purchase.[20] In particular, his Honour found:
(a)in [133] that Frank and Andrea should account to Mary and Chan in relation to those parties' respective entitlements under partnership agreements relating to the purchase, development and sale of each of the eight properties;
(b)in [134(1)] that the accounts are to be prepared on the basis that each agreement giving rise to the interests of the parties to that agreement provided that the proceeds of the relevant development and sale of the property are to be applied first in payment of any mortgage over the property,[21] then in payment of all costs and expenses incurred in relation to the acquisition, development or sale of the property, and then in repayment of any payments made by a party to the agreement in discharge of such costs and expenses other than by use of the parties' joint funds or joint borrowings, with the balance to be divided in accordance with the interest of the parties as reflected on the title to the relevant property at the time of its purchase by the parties.
[14] Primary reasons [64].
[15] Partnership reasons [111] - [112].
[16] Partnership reasons [113].
[17] Partnership reasons [72].
[18] Partnership reasons [74].
[19] Partnership reasons [75].
[20] Partnership reasons [114] and [134(1)].
[21] Primary judge's emphasis.
The orders pronounced by Chaney J were in the following terms:
1.A declaration that the partnerships in relation to the projects referred to in paragraph 2 is dissolved from the date of commencement of this action.
2.An account be taken between the first and second defendants the plaintiff and the second defendant by counterclaim in relation to those parties' respective entitlements under partnership agreements relating to the purchase, development and sale of each of the following properties:
(a)17 Darch Street, Yokine;
(b)73 Main Street, Osborne Park;
(c)111 Shakespeare Avenue, Yokine;
(d)78 Edgecum[b]e Street, Como;
(e)167 and 167A Lockhart Street, Como;
(f)70 Edgecumbe Street, Como;
(g)250 Ewen Street, Woodlands; and
(h)82 and 84 Matlock Street, Mount Hawthorn.
3.Such account to be taken before a registrar of this Honourable Court.
4.The account is to be based on the following findings:
(a)The accounts are to be prepared on the basis that each agreement giving rise to the interests of the parties to that agreement provided that the proceeds of the relevant development and sale of the property are to be applied first in payment of any mortgage or borrowings over the property, then in payment of all costs and expenses incurred in relation to the acquisition, development or sale of the property, and then repayment of any payments made a party to the agreement in discharge of such costs and expenses other than by use of the parties joint funds or borrowings with the balance to be divided in accordance with the interest of the parties as reflected on the title to the relevant property at the time of its purchase by the parties.
(b)Entitlements and liabilities of either the Plaintiff or the Second Defendant by Counterclaim, whether separate or [joint], are to be treated in all cases as joint entitlements.
(c)The interest of parties other than the Plaintiff, First Defendant, Second Defendant, and Second Defendant by Counterclaim in any of the projects referred to are to be taken to have been settled upon completion of those projects so that there is no further liability to account in relation to those interests.
(d)For the purpose of the account, costs of development are to be brought to account on the basis of the lump sum building contract prices for the development applicable in each case. Any balance due in relation to a building contract which remains [unpaid] is to be taken as an expense of the partnership and be taken as payable from the net proceeds of sale of the properties concerned.
(e)Proceeds paid to the First and Second Defendants in the sum of $406,998 from the sale of 8A Spencer Avenue are not to be treated as a contribution by the Plaintiff and Second Defendant by Counterclaim to any of the other partnership projects referred to above. Proceeds paid to the First and Second Defendants from the sale of 8A Spencer Avenue are not to be treated as a contribution by the Plaintiff and Second Defendant by Counterclaim to any of the other partnership projects referred to above.
(f)For accounting, there should be no distinction drawn between the developed properties which were sold, and those that are yet unsold. The value of the unsold properties are to be treated as a receipt of value of those properties in accordance with the interest of the parties as reflected on the title to the relevant property at the time of its purchase by the parties.
5.By 17 August 2018 the First and Second Defendants are to file and serve upon the Plaintiff and the Second Defendant by Counterclaim an account in relation to each partnership in accordance with the Orders made in paragraphs 2 and 4.
6.Within 28 days of service on the Plaintiff and the Second Defendant by Counterclaim of the accounts in relation to each partnership the Plaintiff and the Second Defendant are to apply to a Registrar for directions as to the way any dispute as to any item of the accounts is to be resolved.
7.Any party to the account found liable to the other party to the account do pay to that other party the amount due within 28 days of the Order being made that such party is liable to another party to make such payment.
8.Each party is to bear its own costs of the proceedings to the date of these orders.
9.The question of costs of the accounts is reserved to the Registrar dealing with the account.

We turn now to the primary proceedings.

Procedural history of the primary proceedings

As already noted, the Bank commenced the primary proceedings against Mary, Frank, Andrea and Chan, to recover alleged debts and to obtain possession of two properties, in 2013.
On 20 December 2016, the Bank filed its first application to strike out Mary's further amended defence and counterclaim filed on 16 November 2016.
On 24 May 2017, Martino J struck out a number of paragraphs of Mary's further amended defence and counterclaim and the prayer for relief. His Honour also ordered Mary to file an application to amend her defence and counterclaim together with a minute of the proposed pleading. Mary made such application on 26 September 2017, following which, on 3 November 2017 the Bank filed a document outlining its objections to Mary's proposed minute of re‑amended statement of defence and counterclaim.
On 25 January 2018, Mary filed a further minute of proposed re‑amended statement of defence and counterclaim. On 21 February 2018 she was granted leave to amend her defence and counterclaim in terms of the minute.
The trial of the Partnership proceedings occurred before Chaney J over seven days on and between 9 and 24 April 2018. The parties in the primary proceedings agreed that no action should be taken until Chaney J had determined the Partnership proceedings, the subsequent taking of the account by the registrar had been completed and the judge had determined whether that account should be adopted.
On 22 May 2020, Tottle J published reasons for his decision adopting the report of the registrar in part. At a directions hearing on 4 June 2020, the Bank, as well as Frank and Andrea, foreshadowed a strike‑out application to Mary's pleaded case, observing that at least some of the issues sought to be pressed by Mary in the primary proceedings had been the subject of findings in the taking of the account in the Partnership proceedings.
After some months of conferral, Mary filed a further minute of proposed substituted defence and counterclaim on 2 November 2020. That minute was overtaken by the minute filed on 29 January 2021, which was the subject of the application before the primary judge.

The Bank's claim in the primary proceedings

The primary judge summarised the Bank's claim as being about two outstanding loan debts, namely loan account number 511031108 (the first loan account) and loan account number 422911904 (the second loan account) which were used by Mary, Chan, Frank and Andrea to develop a number of properties which, when developed, were sold and then new properties were purchased and developed. There are two remaining properties which have not been sold and which are mortgaged by the Bank to secure those debts. The Bank seeks possession of the two properties. The first is registered solely in the name of Mary, namely 78C Edgecumbe Street, Como, and the second is registered in the names of each of Mary, Chan, Frank and Andrea in equal shares of 25% (167 Lockhart Street, Como).

Mary's pleaded case in the impugned pleading

The primary judge described Mary's case, as contained in the minute dated 29 January 2021, as prolix and almost incomprehensible. With respect, those descriptions are apt.
On appeal, there is no criticism of the primary judge's distillation of the substance of the case sought to be made.
Mary claimed against the Bank on the basis that the proceeds from the development and sale of the properties should not have been used to fund other developments. She claims that she has no liability to the Bank for some of the borrowings necessary to fund those developments, and counterclaims against the Bank on four grounds. Those grounds are breach of contract, unjust enrichment, unconscionable conduct, and the Bank's failure to mitigate its loss.
As to the breach of contract, Mary pleaded generally that the Bank, in breach of various terms of the loan agreements, 'released securities and Loan Accounts' without notice to, or authorisation from, all of the borrowers (including Mary). Her Honour summarised this pleading as follows:[22]
(1)the Bank was on notice 'as to the veracity of Mary's signature' on various documents relating to some of the properties;[23]
(2)the Bank discharged mortgages without informing Mary or obtaining her consent;[24]
(3)Mary did not agree to vary the relevant loan agreement;[25] and
(4)the Bank permitted Frank and Andrea to make redraws without her written authorisation.[26]
[22] Primary reasons [46].
[23] Impugned pleading [47], [47A], [47B], [47(2)] - [48]. Those properties were 17 Darch Street; 78A, 78B and 78D Edgecumbe Street; 172A McDonald Street; and 2/111 and 3/111 Shakespeare Avenue.
[24] Impugned pleading [22(b) - (f)], [25(b) - (d), (f) - (i)].
[25] Impugned pleading [32] - [34 (particulars 1 and 2)].
[26] Impugned pleading [34 (particular 3)], [35], [46].
As to the second claim, Mary pleaded that the Bank facilitated Frank and Andrea's unjust enrichment by releasing title securities for various properties[27] and allowing Frank and Andrea to retain the proceeds rather than by applying those proceedings towards the first loan agreement. That, Mary pleaded, had the effect of increasing the burden of the parties' loans onto the properties owned and partly owned by Mary.[28]
[27] Being 17 Darch Street; 8 Spencer Avenue; 78A, 78B and 78D Edgecumbe Street; 172A McDonald Street; and 1/111, 2/111 and 3/111 Shakespeare Avenue.
[28] Being 78C Edgecumbe Street and 167 Lockhart Street respectively: primary reasons [46(2)].
As to third claim, Mary pleaded that the Bank and its employees engaged in unconscionable conduct in its financial dealings with Mary contrary to s 12CB of the Australian Securities and Investments Commission Act 2001 (Cth) and/or s 20 and s 21 of the Australian Consumer Law (ACL).[29]
[29] Primary reasons [46(3)].
As to the fourth claim, Mary pleaded that the Bank failed to take any enforcement proceedings against Frank, Andrea and Chan to enforce its default judgment against them on 26 August 2014. That increased the financial burden on Mary in relation to any monies she may owe the Bank (which she denies). This is both a failure on the Bank to mitigate its loss, and unconscionable conduct under s 20 and s 21 of the ACL.[30]
[30] Primary reasons [46(4)].
Mary sought the following relief from the Bank:
(1)A set‑off against the Bank's claim against Mary, or a payment of a sum of $2,671,337.36, being the balance of net sale proceeds which Mary should have received, but were released to Frank and Andrea.[31]
(2)Damages for breach of contract.[32]
(3)A declaration that the mortgages over 78C Edgecumbe Street and 167 Lockhart Street (being properties in which Mary has a legal interest) are discharged.[33]
(4)An order setting aside the mortgages on 78C Edgecumbe Street and 167 Lockhart Street.[34]
[31] Primary reasons [47(a)].
[32] Primary reasons [47(b)].
[33] Primary reasons [47(c)].
[34] Primary reasons [47(d)].
The judge summarised Mary's claim against Frank and Andrea as follows.
Mary pleaded that Frank and Andrea breached their fiduciary duties, obligations under s 40(1) of the Partnership Act 1895 (WA), and engaged in unconscionable conduct contrary to s 11A of the Fair Trading Act 1987 (WA) and s 18 and s 19 of the Fair Trading Act 2010 (WA) by, in essence, failing to apply proceeds from the sale of partnership properties against amounts owing to the Bank or in repayment of the judgment sum.
More specifically, Mary pleaded that:
(1)Frank and Andrea derived benefits from the use of partnership property (being the net sale proceeds of partnership property that was given as security for the first and second loan agreements) without Mary's consent, rather than applying those proceeds to amounts owing to the Bank or the repayment of the judgment sum.
(2)In response to default notices dated 16 April 2012 sent by the Bank in relation to the first and second loan account, Frank and Andrea sold various properties funded in part by the loan agreements and refused to apply the net proceeds from the sale of those properties to amounts owing to the Bank or the repayment of the judgment sum.
(3)Alternatively, Frank and Andrea received profits or withheld partnership property from Mary and wrongfully converted partnership property to their own use and engaged in unconscionable conduct.
Mary claimed the following relief against Frank and Andrea in the impugned pleading:
(1)An entitlement to the proceeds of sale of various properties (17 Darch Street; 78A, 78B and 78D Edgecumbe Street; and 1/111, 2/111 and 3/111 Shakespeare Avenue).[35]
(2)The sum of $956,402.82 in respect of the failure by the Bank, and/or Frank and Andrea, to obtain Mary's consent to vary the first loan agreement and accompanying mortgages.[36]
(3)Damages by reason of the breaches referred to in [22] and [25] of the impugned pleading (which relate to how the proceeds from the sale of properties at Darch Street, Edgecumbe Street, Shakespeare Avenue and Spencer Avenue were applied).[37]
[35] Primary reasons [51(a)].
[36] Primary reasons [51(b)].
[37] Primary reasons [51(c)].

The primary reasons

The primary judge found that Mary's impugned pleading in the primary proceedings sought to challenge various findings made by Chaney J in relation to each of the six properties the subject of his Honour's findings which were also the subject of the primary proceedings. Her Honour detailed this as follows:[38]
[38] Primary reasons [68].
17 Darch Street, Yokine
(1)Justice Chaney found:
(a)This was the first project undertaken jointly between the parties. A loan from the Bank, being loan account 677 848 505, was used to purchase the property in the names of Mary and Frank, as tenants-in-common in equal shares. The loan was in the names of Mary, Chan, Frank and Andrea and was for a sum of $250,000. The property was subdivided creating two lots, 17 and 17A Darch Street, Yokine. Number 17A was sold and the proceeds deposited in loan account 677 848 505. Number 17 was also sold and the net proceeds of sale, being $877,764.14, were deposited into account a Commonwealth Bank of Australia bank account 10054782 in the names of Frank and Andrea.
(b)There were payments out of loan account 677 848 505 in the amount of $231,000, and payments in from the sale of number 17A of $138,946.
(2)In these proceedings in par 22(b) of the impugned pleading, Mary pleads that the Bank partially discharged the mortgage on 17 Darch Street and received the amount of $877,814.14 at settlement with respect to the payment of the first loan agreement and contrary to the terms of the mortgage and without informing or obtaining the consent of Mary, and in breach of the consumer lending provisions and memorandum of common provisions. This plea is inconsistent with and challenges the findings made by Chaney J in [19] - [20], [47(1)] (which findings of fact were extracted from the parties Statement of Agreed Facts), [103], [113], [133] and [134(1)] in which his Honour made it clear that all relevant transactions are to be considered in the taking of an account for this property and the other properties.
(3)Mary also pleads in par 47A and 47B as part of her veracity of signature case that discharge or refinance authorities for 17 Darch Street, Yokine and 78A, 78B and 78D Edgecumbe Street had not been signed by her. This issue was raised in the trial before Chaney J on 17 April 2019 by counsel for Mary, and abandoned on the basis that Mary was not was seeking relief against Frank or Andrea as a result of any forgery, and that the account was to be made on the basis that (borrowings and proceeds of sale were traceable).
111 Shakespeare Avenue
(4)Justice Chaney found:
(a)This was the third project undertaken jointly by the parties. The property was purchased in the names of Mary and Chan as joint tenants as to one half, and Frank and Andrea as joint tenants as to one half, with each couple having an equal share in the property as tenants‑in‑common. A loan from the Bank, being loan account 422 911 904 (particularised as the second loan agreement in these proceedings), was obtained to purchase the Shakespeare Avenue property. The loan was in the names of Mary, Chan, Frank and Andrea. The property was subdivided into three lots, each of which was developed and subsequently sold. The net sale proceeds of number 111A were deposited into loan account 422 911 904,and part of the sale proceeds of number 111B and number 111C were deposited into loan account 422 911 904.
(5)In these proceedings in pars 25(b), (f) and (h) of the impugned pleading Mary pleads that the Bank received the net purchase price of each of the subdivided properties in breach of the terms of the second loan agreement and without informing or obtaining the consent of Mary. This plea is inconsistent with and challenges the findings made by Chaney J in [24] - [27], [47(3)] (which findings of fact were extracted from the parties Statement of Agreed Facts) [113], [103] - [104], [133] and [134(1)]. His Honour made it clear that all relevant transactions are to be considered in the taking of an account for this property and the other properties.
78 Edgecumbe Street, Como
(6)Justice Chaney found:
(a)This was the fourth project undertaken jointly by the parties. It was purchased in the names of Mary, Frank and Andrea as tenants-in-common in equal shares. A loan from the Bank, in the names of Mary, Frank and Andrea, was obtained to purchase the property. The property was subsequently subdivided into four units.
(b)Number 78A was registered in the name of Andrea, number 78B was registered in the name of Frank, number 78C was registered in the name of Mary (and remains unsold), and number 78D was registered in the names of Mary, Frank and Andrea as tenants‑in‑common in equal shares.
(c)Number 78A was sold and part of the proceeds were deposited into loan account 422 911 904. Number 78B and number 78D were also sold and the net proceeds of sale were deposited into other accounts including some deposits into other bank accounts. Of these deposits to other bank accounts some were made to accounts held by Frank and Andrea, one was made to a loan account in the names of Mary, Andrea and Frank, and one deposit was made to an account in the names of Mary and Chan.
(7)In these proceedings in pars 25(d), (g), (i) of the impugned pleading Mary pleads the Bank received the net purchase price of each of the subdivided properties in breach of the terms of the second loan agreement and without informing or obtaining the consent of Mary. This plea is inconsistent with and challenges the findings made by Chaney J in [28] - [30], [47(3), (4), (8) and (9)] (which findings of fact were extracted from the parties' Statement of Agreed Facts), [103] - [104], [113], [133] and [134(1)]. His Honour made it clear that all relevant transactions are to be considered in the taking of an account for this property and the other properties.
167 Lockhart Street, Como
(8)Justice Chaney found:
(a)The Lockhart Street property was purchased in the names of Mary and Chan as joint tenants, and Frank and Andrea as joint tenants, with each couple having an equal share in the property as tenants‑in‑common. The purchase of this property was made from two accounts, one of which was loan account 422 911 904 and the other was also a loan with the Bank and that was in the names of Mary, Andrea and Frank. The property was subdivided into two lots, number 167 and number 167A. Both subdivided properties were registered in the names of Mary and Chan as joint tenants, and Frank and Andrea as joint tenants, with each couple having an equal share in the property as tenants-in-common. The two properties remain unsold.
(b)Importantly, his Honour found that the value of unsold properties should be treated as, in effect, a receipt of value of those properties in accordance with the title ownership. His Honour said that how such interest might ultimately be adjusted, and whether properties need to be sold for that purpose, is a matter to be determined by the parties once the account is settled.
(9)In these proceedings in par 18 of the impugned pleading Mary agrees that the second loan agreement was varied to substitute security over 2/111 Shakespeare Avenue, for 167 Lockhart Street. Mary's claims insofar as it applies to 167 Lockhart Street appears to be a claim by her in pars 55, 70(h) and 101 that by reason of breach of contract by the Bank she has suffered a loss by increasing the burden of the parties' loans on 167 Lockhart Street over which she has 25% ownership. This plea is inconsistent with the findings made by Chaney J in [36] - [38], [47(3) and (4)] (which findings of fact were extracted from the parties' Statement of Agreed Facts), and his Honour's findings in [131], [133] and [134(1)] which make it clear that all relevant transactions are to be considered in the taking of an account for this property and the other properties.
250 Ewen Street
(10)Justice Chaney found:
(a)The Ewen Street property was purchased in the names of Mary, Andrea and David (a brother of Chan and Frank) as tenants-in-common with 50% to Andrea, 25% to Mary and 25% to David. The parties agree that two loan were obtained from the ANZ in the name of Frank (for one loan) and Frank and his mother (for the other loan). Mary asserts that funds to purchase the property were sourced from a third loan from the Bank in the names of Frank, Mary and Andrea. Justice Chaney rejected Mary's assertion, reasoning that the two ANZ loans were sufficient to meet the cost of the purchase of property.
(b)The property was subdivided into four lots, being number 250A, number 250B, number 250C and number 250D. Other than number 250C, the subdivided properties were sold. David received the net proceeds of sale of number 250A. The proceeds of sale of number 250B were applied to the ANZ loan accounts and no details had been provided as to the net sale proceeds of 250D.
(11)In these proceedings in par 93 Mary pleads against Frank and Andrea that in breach of s 40(1) of the Partnership Act and in breach of their fiduciary duty to Mary and Chan, Frank and Andrea sold and settled various properties funded in part by the loan agreements which included 250B and 250D Ewen Street, and refused and have not applied the net proceeds they received in payment of loan agreements and/or the judgment sum. This plea is inconsistent with findings made by Chaney J in the partnership proceedings. His Honour's findings made it clear that all relevant transactions are to be considered in the taking of an account for this property and the other properties. Consequently, the issue pleaded in these proceedings about this property could have been pressed in the taking of the account by the registrar.
82 and 84 Matlock Street
(12)Justice Chaney found:
(a)82 and 84 Matlock Street were purchased in the names of Frank, Chan and David as tenants-in-common in equal shares. Three redraws were made towards the purchase price of the property. Two redraws were from loan account 422 911 904(the first loan account) and the other redraw was from loan account 511 031 108 (the second loan account).
(b)The Matlock Street property was subdivided into six lots, being units 1 to 6. Units 1 and 3 were registered in the name of Frank, units 2 and 4 were registered in the name of David, unit 5 was registered in the name of Chan, and unit 6 was registered in the names of Frank and David as joint proprietors. Units 1 and 2 remained unsold. Unit 3 was sold. According to Frank and Andrea, unit 4 was sold, and according to Mary, unit 5 was sold.
(c)The source of the payment for the balance of the purchase price of the property is unclear, and the destination of the proceeds of sale of units 3, 4, 5 and 6 was unclear on the evidence.
(13)In these proceedings in par 93 of the impugned pleading, Mary pleads that in breach of s 40(1) of the Partnership Act and in breach of their fiduciary duty to Mary and Chan, Frank and Andrea sold and settled various properties funded in part by the loan agreements which included the Matlock Street property, and refused and have not applied the net proceeds they received in payment of loan agreements and/or the judgment sum. This plea is inconsistent with the findings made by Chaney J in the partnership proceedings that all relevant transactions are to be considered in the taking of an account for this property and the other properties. (emphasis added, citations omitted)

The primary judge found that it would be an abuse of process to allow Mary's pleaded case to proceed.
Her Honour observed that the analysis set out in [49] above demonstrated that, for each of the properties, the issues Mary pleaded were either the subject of agreed facts or could have been pressed in the trial before Chaney J.[39]
[39] Primary reasons [69].
The primary judge considered that, having regard to the claims made by Mary, including the claims abandoned in the Partnership proceedings, it is an abuse of process for Mary to raise issues about the borrowings and proceeds of sale in respect of those six properties. To allow those issues to be litigated would allow Mary to put a case against the Bank and Frank and Andrea that was inconsistent with the case she put in the Partnership proceedings.[40]
[40] Primary reasons [71].
In relation to the seventh property, 172A McDonald Street, Joondanna, which is not the subject of Chaney J's reasons, her Honour identified several defects in Mary's pleaded case, ultimately concluding that Mary should have raised any such claim in the Partnership proceedings.[41]
[41] Primary reasons [72] - [75].
As to the eighth property, 8A Spencer Avenue, Yokine, her Honour noted that Frank and Andrea had initially made a claim for an account in relation to this property in the Partnership proceedings. Ultimately, the issue before Chaney J was whether a payment made by Chan to Frank and Andrea was paid pursuant to an agreement alleged by Frank or whether, as Mary alleged, there was no such agreement and it was paid as a contribution by Mary and Chan to other development projects. Ultimately, Chaney J found that the agreement in relation to this property was made as alleged by Frank and had been completely performed. The primary judge held that to attempt to 're-litigate this issue in respect of this property in [the primary] proceedings is an abuse of process'.[42]
[42] Primary reasons [77].
Her Honour found that if Mary wanted to claim that she did not join in borrowing any or some of the funds from the Bank, she should have done so by raising the point in the Partnership proceedings. She did not do so. Rather, she framed her case in the Partnership proceedings on the basis of equal borrowing to fund each of the developments and that the amounts borrowed from the Bank were to be regarded as a cost of the development to be taken into account in the ascertainment of profit. If Mary had claimed before Chaney J, and his Honour had found, that she had no liability for some of the borrowings used to purchase some of the properties, that would have had a significant impact on the nature of any account ordered.[43] In those circumstances, her Honour considered Mary should not be allowed to run her defence and counterclaim on the basis that she has no liability for some of the borrowings necessary to fund the property developments for each relevant partnership.[44]
[43] Primary reasons [78], [81].
[44] Primary reasons [78].
The judge considered that, in substance, by the impugned pleading, Mary alleged that Frank and Andrea diverted partnership funds from amounts borrowed from the Bank, there being a claim for $8.8 million or $6.4 million in the counterclaim and a claim of loss against the Bank of $6.4 million. The judge then said:[45]
What can only be inferred by Mary's damages claim is that none of the funds borrowed from the Bank that the Bank claims in these proceedings as debts owing were used to fund the developments undertaken by the parties in the partnership proceedings. If such an allegation was to be properly made then it should have been made in the partnership proceedings when the matter was heard and determined by Chaney J.
Grounds 2 - 4 appear to challenge this finding.
[45] Primary reasons [88].
The primary judge noted that Mary claims that Frank and Andrea diverted partnership funds, pleading that they used all of the funds borrowed from the Bank for their own purposes.[46] To the extent that such claims were raised in the Partnership proceedings, Chaney J made findings in respect of each allegation. The parties are, the judge considered, bound by those findings.[47] Her Honour observed that there was no appeal from the decision of Chaney J.
[46] Primary reasons [87] - [88].
[47] Primary reasons [89].
The primary judge observed that Chaney J was satisfied that Mary and Chan undertook significant borrowing risk and joined in the borrowing necessary to undertake the purchase of property on the basis that they would be entitled to an agreed share of the development of that property, including their proportionate share of the profit. Consequently, Chaney J ordered an account on the basis that proceeds would be applied first, in payment of any mortgage or borrowing over the property. Mary is, her Honour considered, bound by the order made and by the finding that the mortgages and borrowings used to purchase and develop the properties were liabilities of the relevant partnership. The primary judge considered it an abuse of process for Mary to claim otherwise in the primary proceedings.[48]
[48] Primary reasons [90].
The judge provided an alternative basis for her conclusions. Her Honour considered that it was not permissible for Mary to approbate the pleaded position and her conduct in the Partnership proceedings and to then reprobate by the impugned pleading in the primary proceedings. The judge observed that Mary sought an order for an account before Chaney J, and then, having obtained the order, enforced it by pursuing the account before Registrar Whitbread. Notwithstanding Mary having filed an appeal against Tottle J's adoption of the registrar's report, the primary judge was satisfied that Mary had taken the benefit of the judgment in the Partnership proceedings. Thus, her Honour considered, Mary should be bound by the course she adopted in the Partnership proceedings.[49]
[49] Primary reasons [84].
Consequently, the primary judge concluded, Mary should not be granted leave to replead.[50]
[50] Primary reasons [92].

Grounds of appeal

Mary advances four grounds of appeal, in the following terms:
GROUNDS:
(1)The learned Judge's refusal at [92] to permit Mary to file a further defence (to CBA's SOC) and counterclaim (as against CBA and Francis & Andrea) was an unreasonable exercise of discretion and thereby an error of law. Given that the applications leading to the making of Smith J's Orders were the first 'pleading application' in the Bank Action since Tottle J's Orders, the learned Judge should have given Mary at least one opportunity to formulate a pleading which was not inconsistent with anything in Chaney J's Reasons, Chaney J's Orders or Tottle J's Orders.
(2)The learned Judge's refusal at [92] to permit Mary to file a further defence (to CBA's SOC) and counterclaim (against CBA) was an unreasonable exercise of discretion, and thereby an error of law, because the learned Judge should not have been comfortably certain, for summary disposal purposes, that at least a significant amount of the funds claimed in CBA's SOC was not the subject of:
(1)consideration in Chaney J' s Reasons; or
(2)the taking of accounts in the Partnership Action pursuant to Chaney J's Orders.
See [88].
(3)The learned Judge's refusal at [92] to permit Mary to file a further counterclaim (against Francis & Andrea) was an unreasonable exercise of discretion, and thereby an error of law, because the learned Judge should not have been comfortably certain, for summary disposal purposes, that at least a significant amount of the funds the subject of that counterclaim was not the subject of:
(1)consideration in Chaney J' s Reasons; or
(2)the taking of accounts in the Partnership Action pursuant to Chaney J's Orders.
See [88].
(4)The learned Judge erred in law in making an order in terms of paragraph 4 of Smith J' s Orders, which order was tantamount to an order granting summary judgment in favour of Francis and Andrea, whereby Mary's counterclaim against them was dismissed. On the material relied on by Francis and Andrea in support of their applications against Mary, the learned Judge should not have been satisfied, to the summary judgment standard, that at least a significant amount of the funds the subject of that counterclaim was not the subject of:
(1)consideration in Chaney J' s Reasons; or
(2)the taking of accounts in the Partnership Action pursuant to Chaney J's Orders.
See [88].
Mary requires leave to appeal, at least as against the Bank. It is convenient to turn immediately to the merits of the grounds, to explain why both grounds must be rejected.

Ground 1 - was it unreasonable to refuse leave to replead?

Mary's submissions

Mary does not challenge the primary judge's decision to strike out the impugned pleading on the basis that it was an abuse of process and that it infringed the doctrine of approbation and reprobation.[51]
[51] Appellant's submissions [43] - [45].
Mary identifies the gist of ground 1 as follows. She submits that the decision to deny her the opportunity to file a further defence which did not infringe the substantive matters of abuse of process and approbation and reprobation was unreasonable in the House v The King[52] sense.[53]
[52] House v The King (1936) 55 CLR 499.
[53] Appellant's submissions [45].
In support of that contention, Mary submits that the strike‑out application before the primary judge was the first pleading application in the primary proceedings subsequent to Tottle J making his decision to adopt the registrar's account. In those circumstances, she submits, the primary judge should have given Mary at least one opportunity to formulate a pleading which was not inconsistent with anything in Chaney J's reasons or orders, or the orders of Tottle J, and which did not involve an abuse of process or an infringement of the doctrine of approbation and reprobation.[54]
[54] Appellant's submissions [65] - [66].
Mary submits that she should be entitled to file a serve a defence and counterclaim in the form of the proposed new substituted defence and counterclaim which is an appendix to her orders wanted (proposed pleading).[55]

Disposition

[55] Appellant's submissions [68].

As Mary's counsel ultimately accepted,[56] it is fatal to this ground that, before the primary judge, she did not at any stage seek leave to replead. Moreover, before the primary judge, counsel for Mary did not suggest that she contemplated any claim that did not face the same fundamental obstacles. At the hearing on 28 April 2021, Mary's counsel conceded that the impugned pleading did not plead any redraws that were used for any purpose apart from for partnership properties.[57] Counsel made no suggestion contemplating the taking of a different approach. The Bank's written submissions made clear its contention, namely that the pleading should be struck out on the alternative bases, with no leave to replead. In those circumstances, the absence of any submission seeking leave to replead is telling. When the primary judge delivered her reasons, there was a hearing concerning whether the preceding pleading should be struck out. At no time in the course of that hearing did Mary's counsel raise the question of leave to replead.
[56] Appeal ts 35.
[57] ts 168.
In these circumstances, the primary judge was not called upon to exercise a discretion to grant or refuse leave to replead, because Mary made no application for leave to replead.
When a court is invited to make a discretionary decision, to which many factors are relevant, it is incumbent on parties who contend on appeal that attention was not given to particular matters to demonstrate that the primary judge's attention was drawn to those matters, at least unless those matters were fundamental and obvious.[58] As this court observed in ABC (a pseudonym) v Reader Lawyers & Mediators,[59] all the more so is it incumbent on a party, who contends on appeal that a discretion should have been exercised, to have invited the primary judge to exercise the discretion unless the requirement for its exercise was obvious or fundamental. In circumstances where no submission was made seeking leave to replead, and there was nothing to suggest that the appellant may have available alternative claims that did not suffer the same fundamental problems, the exercise of the discretion to give leave to replead was neither fundamental nor obvious and there was no basis upon which it could be said that the primary judge's discretion miscarried.
[58] Macedonian Orthodox Community Church St Petka Incorporated v His Eminence Petar The Diocesan Bishop of The Macedonian Orthodox Diocese of Australia and New Zealand [2008] HCA 42; (2008) 237 CLR 66 [120].
[59] ABC (a pseudonym) v Reader Lawyers & Mediators [2021] WASCA 202 [24].
In these circumstances, it cannot be said to have been unreasonable, in the House v The King sense, for the judge to have refused leave to replead.
Although that is sufficient to dispose of ground 1, for completeness we note that this conclusion is reinforced when regard is had to the pleading now proposed on Mary's part. The gist of the proposed pleading remains that the Bank permitted Frank and Andrea to make various redraws in relation to the first and second loan agreements without Mary's consent, in breach of contract, so that Mary is not liable for those redraws.[60]
[60] Proposed pleading [52] - [55].
Further, Mary claims a set‑off for $915,000.[61] This appears to be comprised of the following amounts:
(1)$200,000 the Bank received from the sale of 3/111 Shakespeare Avenue.[62] Mary pleads that the Bank was not entitled to receive that amount because Mary wasn't a party to the first variation.[63]
(2)$600,000 paid into an account in Frank's name from sale of 78B Edgecumbe Street based on Frank's instructions.[64]
(3)$115,000 paid into an account in Frank's name from the sale of 78D Edgecumbe Street based on Frank's instructions.[65]
[61] Proposed pleading [56].
[62] Proposed pleading [34], [56].
[63] Proposed pleading [35].
[64] Proposed pleading [38], [56].
[65] Proposed pleading [46], [47], [56].
As the Bank's submissions point out, on the primary judge's unchallenged finding and reasoning, any challenge to the redraws should have occurred in the Partnership proceedings. Had such a challenge been made, it would have had an impact on the nature and terms of the account ordered. The proposed pleading has the same problems of abuse of process and of approbation and reprobation as led to the striking-out of the impugned pleading.

Grounds 2 - 4

Appellant's submissions

Mary's submissions identify the gist of these grounds in the following way. The primary judge implicitly made a finding that all of Mary's complaints in the impugned pleading were the subject of Chaney J's reasons (and thereby the registrar's report on the taking of account).[66] That finding of fact should not have been made to the high standard of certainty necessary for summary disposal.[67]
[66] Appellant's submissions [46], referring to various subparagraphs of [68] of the primary reasons.
[67] Appellant's submissions [47].

Mary submits that both as between her and the Bank, and as between her and Frank and Andrea, there was insufficient material before the primary judge to support a 'summary judgment conclusion' that all of the funds claimed by the Bank in the primary proceedings were the subject of Chaney J's reasons.[68]
[68] Appellant's submissions [70] - [71].
Further, Mary contends that specific amounts referred to in the proposed pleading were not the subject of Chaney J's reasons and not the subject of findings in the registrar's report.[69]

Disposition

[69] Appellant's submissions [73].

The fundamental difficulty with Mary's submissions on these grounds is their premise. As she accepts,[70] these grounds are premised on the primary judge having impliedly made the finding of fact that all of Mary's complaints were the subject of Chaney J's reasons. The judge made no such finding. Rather, the judge observed that some of the matters were the subject of Chaney J's reasons, but, more significantly, the judge considered that the complaints sought to be advanced in the impugned pleading should have been raised in the Partnership proceedings.
[70] Appellant's submissions [46] – [47]; appeal ts 25.
On a plain reading of the reasons, the fundamental basis for the judge's decision was that her Honour considered that the complaints sought to be advanced in the impugned pleading should have been raised in the Partnership proceedings. That is clear from the italicised passages in the quote, set out at [49] above, from [68] of the primary reasons, and from consideration of her Honour's reasoning to the conclusion of abuse of process. Immediately following the detail set out in [68] of the primary reasons, in commencing consideration of whether there was an abuse of process, the judge observed that the analysis in [68] demonstrated that, for each of the six properties, the issues Mary pleaded were 'either the subject of agreed facts or were issues that could have been pressed in the trial before Chaney J'.[71] In similar vein, her Honour observed in relation to 172A McDonald Street, Joondanna, that the claims sought to be made in the impugned pleading should have been raised in the Partnership proceedings.[72]
[71] Primary reasons [69].
[72] Primary reasons [75].

As already noted, her Honour found that '[i]f Mary wanted to claim that she did not join in borrowing any or some of the funds from the Bank she should have done so by raising the point in [the Partnership proceedings].'[73] She did not do so, but, rather, framed her case in the Partnership proceedings on the basis of equal borrowing to fund each of the developments and that the amounts borrowed from the Bank were to be regarded as a cost of the development to be taken into account in the ascertainment of profit. The primary judge considered that if Mary had claimed before Chaney J, and his Honour had found, that she had no liability for some of the borrowings used to purchase some of the properties, that would have had a significant impact on the nature of any account ordered.[74] In those circumstances, her Honour considered Mary should not be allowed to run her defence and counterclaim on the basis that she has no liability for some of the borrowings necessary to fund the property developments for the partnership.[75]
[73] Primary reasons [78].
[74] Primary reasons [81].
[75] Primary reasons [78].
To say that complaints should have been raised in the Partnership proceedings is very different from saying that the complaints had been the subject of findings in those proceedings. Indeed, saying that complaints should have been raised in the Partnership proceedings recognises that such complaints were not made. Thus, far from implicitly finding that all the claims Mary sought to advance in the impugned pleading were the subject of findings by Chaney J, in observing that all of the claims should have been raised in the Partnership proceedings, the judge recognised that not all of them had been the subject of findings.
In oral submissions, Mary sought to support the reading of the primary judge's reasons she invites with submissions to the following effect. The claims Mary now seeks to advance against the Bank - that she is not liable in respect of unauthorised debits to the relevant account - could not have been advanced in the Partnership proceedings because the Bank was not a party to those proceedings. That being so, the judge's reasons should not be read as finding that all of the claims now sought to be made should have been raised in the Partnership proceedings.[76]
[76] Appeal ts 28 - 29.

There is no ground of appeal alleging error in the judge's reasoning in striking out the impugned pleading on the ground that the complaints sought to be advanced in the impugned pleading should have been raised in the Partnership proceedings. Rather, the submission in [81] above is directed to the manner in which the judge's reasons are to be read.

This submission cannot be accepted. It cannot overcome the plain terms of the judge's reasons. As explained in [78] ‑ [79] above and as can be seen from the outline in [49] ‑ [58] above, the basis of the judge's decision was that the complaints sought to be advanced in the impugned pleading should have been raised in the Partnership proceedings.
For these reasons, grounds 2 ‑ 4 fail at the outset: they are founded on a misreading of the judge's reasons.

Leave to appeal

Given the lack of merit of the grounds of appeal, leave to appeal should be refused.

Conclusion

For the above reasons, we refused leave to appeal, dismissed the appeal and ordered the appellant to pay the respondents' costs.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
BM
Associate to the Honourable Justice Beech
23 SEPTEMBER 2022