Clambake Pty Ltd v Tipperary Projects Pty Ltd [No 7] - [2009] WASC 390

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL

CITATION: CLAMBAKE PTY LTD -v- TIPPERARY PROJECTS PTY LTD [No 7] [2009] WASC 390

CORAM: EM HEENAN J

HEARD: 16, 17 & 18 NOVEMBER 2009

DELIVERED : 14 DECEMBER 2009

FILE NO/S: CIV 1707 of 2003

BETWEEN: CLAMBAKE PTY LTD (ACN 009 242 371)
Plaintiff
AND
TIPPERARY PROJECTS PTY LTD (ACN 054 744 713)
First Defendant
WARREN PERRY ANDERSON
Second Defendant

FILE NO/S :CIV 2093 of 2003

BETWEEN :OWSTON NOMINEES No 2 PTY LTD (ACN 001 769 099)
First Plaintiff
TIPPERARY PROJECTS PTY LTD (ACN 054 744 713)
Second Plaintiff
AND
CLAMBAKE PTY LTD (ACN 009 242 371)
First Defendant
LAND CAPITAL PTY LTD (ACN 058 548 806)
Second Defendant
IVOR FREDERICK COHEN
Third Defendant
WARREN PERRY ANDERSON
Defendant to counterclaim

Catchwords:

Guarantee and indemnity - Defence and cross-claim for modification of contractual terms - Trade Practices Act ss 80 and 87 - Cross-claim for injunction - Alleged estoppel and res judicata - Alleged abuse of process - Alleged privity between director of company and corporation - Accrual of limitation periods for claims under s 87 of the TPA - Relationship between new claims and counterclaims and causes of action previously determined - Interest on judgments - Merger of causes of action in judgment - Exceptions to doctrine of merger - Application for extension of order suspending enforcement of judgment

Legislation:

Civil Judgments Enforcement Act 2004 (WA)
Fair Trading Act 1987 (WA)
Supreme Court Act 1935 (WA)
Trade Practices Act 1974 (Cth)

Result:

CIV 1707 of 2003
Application for special rate of interest on judgment debt dismissed

CIV 2093
New claim by Clambake for indemnity against Mr Anderson for Clambake's liability to Owston dismissed
Judgment for Mr Anderson on his cross-claim against Clambake for relief under s 87 of TPA
Order for suspension of enforcement of judgment extended but on further conditions

Category: A

Representation:

CIV 1707 of 2003

Counsel:

Plaintiff:     Mr P J Deakin QC & Mr S E McCarthy
First Defendant             :     Mr S Rushton SC & Mr J Giles
Second Defendant         :     Mr S Rushton SC & Mr J Giles

Solicitors:

Plaintiff:     Minter Ellison
First Defendant             :     Solomon Brothers
Second Defendant         :     Solomon Brothers

CIV 2093 of 2003

Counsel:

First Plaintiff                :     Mr M L Bennett & Mr C Chenu
Second Plaintiff            :     Mr S Rushton SC & Mr J Giles
First Defendant             :     Mr P J Deakin QC & Mr S E McCarthy
Second Defendant         :     No appearance
Third Defendant           :     Mr P J Deakin QC & Mr S E McCarthy
Defendant to counterclaim   :     Mr S Rushton SC & Mr J Giles

Solicitors:

First Plaintiff                :     Lavan Legal
Second Plaintiff            :     Solomon Brothers
First Defendant             :     Minter Ellison
Second Defendant         :     Sparke Helmore
Third Defendant           :     Minter Ellison
Defendant to counterclaim   :     Solomon Brothers

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

Akron Securities Ltd v Iliffe (1997) 41 NSWLR 353
Arbuthnot v Bunsilall (1890) 62 LT 234
Ardrey v Bartlett [2004] WASCA 256
ASX Operations Pty Ltd v Pont Data Australia Pty Ltd [No 1] (1990) 27 FCR 460
ASX Operations Pty Ltd v Pont Data Australia Pty Ltd [No 2] (1991) 27 FCR 492
Clambake Pty Ltd v Tipperary Projects Pty Ltd [No 3] [2009] WASC 52
Clambake Pty Ltd v Tipperary Projects Pty Ltd [No 5] [2009] WASC 141
Clambake Pty Ltd v Tipperary Projects Pty Ltd [No 6] [2009] WASC 200
Ealing Londonborough Council v L Isaac [1980] 1 WLR 932 CA
Eastland Technology Australia Pty Ltd v Whisson [2003] WASCA 307
Economic Life Assurance Society v Usborne [1902] AC 147
Ex parte Fewing; Re Sneyd.(1883) 25 ChD 338
Fidelitas Shipping Co Ltd v V/O Exportchleb [1966] 1 QB 630
Foster v Australian Competition & Consumer Commission [2006] FCAFC 21; (2006) 149 FCR 135
General Steel (1964) 112 CLR 125
Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478
Henderson v Henderson [1843] 67 ER 313
Hodder v Hodder [2008] WASCA 236
Hungerfords v Walker (1989) 171 CLR 125
Mansfield v Director of Public Prosecutions for Western Australia (2006) 226 CLR 486
Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494
Master Education Services Pty Ltd v Ketchell (2008) 249 ALR 44 [28]; [2008] HCA 38; (2008) 236 CLR 101
Mercantile Credits Ltd v McDowell [1980] 2 NSWLR 101
Mister Figgins Pty Ltd v Centrepoint Freeholds Pty Ltd (1981) 36 ALR 23
Murphy v Overton Investments Pty Ltd (2004) 216 CLR 388
Nominal Defendant v Manning [2000] NSWCA 80; (2000) 50 NSWLR 139
O'Toole v Charles David Pty Ltd [No 2] (1991) 171 CLR 232
Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589
Professional Services of Australia Pty Ltd v Computer Accounting and Tax Pty Ltd [2008] WASCA 222
Re Central European Railway Co; Ex parte Oriental Finance Corporation (1876) 4 ChD 33
Re European Central Railway (1877) 4 ChD 33
State Bank of NSW Ltd v Chia (2000) 50 NSWLR 587
Tenji v Henneberry & Associates Pty Ltd [2000] FCA 550; (2000) 98 FCR 324
Trade Practices Commission v Milreis Pty Ltd (1977) 29 FLR 144
Wardley Australia Ltd v State of Western Australia (1992) 175 CLR 514
Warwick Entertainment Centre Pty Ltd v Alpine Holdings Pty Ltd [2005] WASCA 174; (2005) 224 ALR 134

EM HEENAN J: These reasons address some of the outstanding issues remaining after the trial of earlier related claims in (Clambake Pty Ltd v Tipperary Projects Pty Ltd [No 3] [2009] WASC 52) (Clambake [No 3]). More particularly, they are reasons for decision after the separate trial of new, but still related, claims by Clambake against Tipperary, and the new defendant to the counterclaim in the fire action, Mr Anderson, and their corresponding new cross‑claims, which have been introduced into this litigation pursuant to leave granted on 20 March 2009 after the decision in Clambake [No 3] was given on 8 March 2009.
Some details of these new claims, how they came to be introduced and issues concerning them, are set out in the reasons for decision in Clambake Pty Ltd v Tipperary Projects Pty Ltd [No 5] [2009] WASC 141 (Clambake [No 5]) when I dismissed an application to strike out portions of the amended counterclaim by Clambake and the new cross‑claims by Tipperary and Mr Anderson and when I also I refused an application for summary judgment in favour of Clambake as the defendant to the new counterclaim. That decision included an order extending an earlier order for the suspension of enforcement of the judgment in the fire claim in favour of Owston against Clambake. A similar application for an extension of that suspension order was again made at the end of this trial and granted on terms. I will address the details of that application towards the end of these reasons.
The trial of these new issues took place over three days but no new evidence was adduced. All the parties, including Mr Anderson, the newly added defendant to the counterclaim by Clambake in the fire action, and himself, a cross‑claiming party for relief against Clambake, agreed that all the evidence adduced at the original joint trials of the rent action and the fire claim should stand as evidence in these new claims and that I should make such findings on that evidence as I considered necessary for the resolution of the present claims but consistent with findings already made in my decisions dealing with the rent action and the fire claim in Clambake [No 3] in March 2009. In particular, the new party to the counterclaim in the fire action, Mr Anderson, did not seek to adduce any evidence in connection with the claim against him or in support of his new cross‑claim. He agreed that all the evidence taken in the earlier proceedings could be used in the manner I have just described.

Claims and issues for decision

Inevitably, in view of the Hydra like character of this litigation, not all the issues remaining or arising from the first joint trial of the rent action and the fire claim were raised for determination at this recent trial. It is necessary to identify those which were not, if only to segregate them for future disposition or determination. Those outstanding issues are:
(a)The claim by Clambake against Tipperary and Mr Anderson as guarantor in the rent action pursuant to contractual terms in the lease as assigned and extended which provide for the landlord, Clambake, to recover against the tenant, Tipperary, and its guarantor, Mr Anderson, legal costs, charges and expenses for which the lessor should become liable in consequence of, or in connection with, any default by the lessee in performing or observing any of the covenants, conditions or stipulations contained or implied in the lease (the 'contractual costs issue').
As set out in Clambake [No 5], in May 2009 I made orders referring the contractual claim for costs for investigation and report by a Registrar before final determination in the rent action. I have been informed by the parties that the process of investigation and report by the Registrar is under way and that, in due course, the result of that can be reported and dealt with as necessary. Accordingly, it forms no part of this recent trial or of this decision.
(b)The claim by Clambake against Tipperary (on the counterclaim in the fire claim) for damages for the alleged breach of the covenant to insure, in joint names with Clambake, the demised premises against the loss which materialised (the 'failure to insure' issue).
This claim has also expanded as a result of the amendments made in March 2009 and the introduction of Mr Anderson as a defendant to this counterclaim as guarantor of the liabilities of Tipperary under the lease. It has also resulted in a defence and cross‑claim by Mr Anderson in which he claims relief under ss 80 and 87 of the Trade Practices Act, and corresponding provisions of the Fair Trading Act, on the grounds that if any liability by him might otherwise arise under the guarantee, that was caused by the misleading and deceptive conduct already found to have occurred by Clambake towards Owston which led to the judgment in favour of Owston in the fire claim.
However, none of Clambake, Tipperary or Mr Anderson has sought a final disposition of these claims or counterclaims on 'the failure to insure' issue at the latest trial on the basis that determination of other claims heard might have the potential to lead to an agreed resolution of these particular claims and, even if not, that the expense and effort of proceeding with those claims would be better evaluated after decisions on the other remaining issues had been given and, even perhaps, after appeals instituted against decisions given in Clambake [No 3] have been determined. Accordingly, while the determinations which I must make of the issues now addressed have the potential to affect the 'failure to insure' issue and the new defences and counterclaims which have been raised in respect of it, it is not directly addressed or determined by this decision.

Issues for determination

The issues and corresponding counterclaims and cross‑claims which were heard and which must now be determined are:
(a)the new counterclaim by Clambake in the fire claim against the new party to that litigation, Mr Anderson, seeking judgment against him in reliance upon cl 4.01 of the lease to indemnify Clambake for the whole of the liability which it has been found to have to Owston in the original fire claim which, with the interest component to that claim determined in Clambake [No 5], now stands at $20,102,111.43 [$14,625,400 plus interest of $5,476,711.43];
(b)the new cross‑claim by Tipperary against Clambake that, notwithstanding my reasons for decision in Clambake [No 3] and the orders for judgment of 20 March 2009, Tipperary should have relief in the nature of an injunction under s 80 of the Trade Practices Act or other orders under s 87 of the TPA, preventing Clambake from enforcing that liability against it;
(c)the defence and cross‑claim by Mr Anderson to Clambake's amended counterclaim in the fire claim against him for an indemnity under the guarantee, for an injunction under s 80 or other orders under s 87 of the TPA, alternatively or concurrently, for equivalent relief under the FTA either to prevent Clambake from enforcing any such liability against him or, modifying the terms of the contract of guarantee by orders under s 87, which would have the effect of relieving Mr Anderson from any such potential liability.

Principal arguments for the parties

The positions of the parties with regard to these new claims can be divided into two categories. The first, at least as canvassed in the submissions, relates to issues of fact, namely whether or not Mr Anderson's entry into the guarantee or his continuing potential liability under the guarantee was caused by misleading or deceptive conduct on the part of Clambake, giving rise to the question of, other considerations being equal, whether that would entitle Mr Anderson to some form of relief under ss 80 or 87 of the TPA or corresponding provisions of the FTA.
These issues of fact are not identical to the issues of fact determined in the original judgment in the fire claim (Clambake [No 3]) because, of course, no claim was made in that action by Clambake against Mr Anderson for any alleged liability by him to indemnify Clambake for any liability which it might be found to have to Owston whether under cl 4.01of the lease or at all. Hence the question of whether Mr Anderson, as distinct from Owston, acted in reliance upon that misleading or deceptive conduct was not in point of law decided by that earlier decision. Again, the controversy in Clambake [No 3] concerned whether or not the misleading and deceptive conduct found against Clambake, caused Owston to enter into the lease or to continue with the arrangements under the lease up until the date of the fire. That is in contrast to the present question of whether or not Mr Anderson entered into the guarantee and indemnity, or continued his potential liability under the guarantee and indemnity up until the date of the fire because of that misleading or deceptive conduct. While the issues are very similar, they are not identical and it is therefore necessary to reach findings in relation to them or, as I was urged to do, to take the 'short but inevitable step' to make such findings as mentioned in Clambake [No 5]at [58].
Counsel for Clambake has submitted that I could not, or should not, make any such finding because the findings in Clambake [No 3], were that Owston did not enter into the assignment of the lease with Clambake as a result of the alleged misleading or deceptive conduct but, rather, allowed its collection of valuable antiques, artefacts, etc, to remain in the Claremont storeroom until the fire without removing them, which Mr Anderson would have arranged had he discovered that there was no working fire sprinkler system operational in the areas which Tipperary had leased. However, I do not consider that the findings made in Clambake [No 3] were so confined.
In [776] ‑ [784] of Clambake [No 3] I explained the basis for my conclusions that Tipperary would not have entered into the lease and that Owston would not have stored all the valuable artefacts in the premises; and that Tipperary would not have continued with the leasing arrangement or the holding over after the expiration of the lease; and that Owston would not have permitted its valuable property to remain in that storage if Mr Anderson had become aware of the fact that an operational fire sprinkler system for the premises did not exist. My findings were, essentially, that either Tipperary would not have entered into the assignment of the lease, or continued with it, and that Owston would not have placed its property in the premises or allowed it to remain there had the true situation been disclosed to Mr Anderson or if he had become aware of it before the fire.
On the evidence at the joint trial, and consistently with those findings, I consider that I should find, as I now do, that had it not been for the misleading and deceptive conduct of Clambake, Mr Anderson would not have entered into the guarantee and indemnity now sought to be enforced against him or that, if he had, and had then later discovered that the premises did not have a compliant and fully operational fire sprinkler system, he would have caused Tipperary to terminate the lease, or the holding over arrangements, before the fire and for Owston to remove its property from the storeroom, before it was destroyed on 22 December 2002.
In Clambake [No 3] I concluded that it was the effect of the misleading and deceptive conduct of Clambake upon Mr Anderson that led Tipperary to enter into and to continue with the lease and holding over tenancy and to Owston placing its property in the premises and allowing it to remain there until the fire. I did not find, because there was no issue on the pleadings, or on the way the case was conducted, that Mr Anderson had entered into the guarantee and indemnity because of the same misleading or deceptive conduct. It is now necessary for me to address this particular issue of fact and, as said at [58] in Clambake [No 5], on the evidence as it then stood, and which now remains unchanged, it is a short and inevitable step to make that finding and as I now do.
It is important, however, to appreciate that the finding is a compendious one, namely that, but for the misleading and deceptive conduct of Clambake, Mr Anderson would not have entered into the guarantee and indemnity with Clambake under which he agreed to guarantee and be answerable for the liabilities of Tipperary under the lease or, if he had, would not have allowed that liability to continue without causing Tipperary to terminate the lease or the holding over arrangements, and for Owston to remove its valuable property from the premises within a short time of discovering the true position about the non‑operational fire sprinkler system. It is necessary to express the finding in this way because, as set out in Clambake [No 3], and as I remain satisfied is the position, the effect of that misleading and deceptive conduct was a continuing one. It induced the parties concerned to enter into contractual arrangements with Clambake, in Mr Anderson's case to execute the guarantee, and it continued thereafter to have its effect in causing those parties, including Mr Anderson, to allow the property to remain in the Claremont storeroom in the false and mistaken belief that the fire protection system included an operational and compliant fire sprinkler system. Accordingly, it also entails a finding that, but for the misleading and deceptive conduct, Mr Anderson would have taken steps to cause Tipperary to terminate the lease or the holding over arrangements and for Owston to remove its property from the premises.
For Mr Anderson, this opens the gates to relief under the TPA and/or the FTA. Just what that relief might be and whether, to the extent that it may be discretionary, it should be granted remains to be considered.
The second category of submissions relied upon by Clambake, both for the relief which it seeks against Mr Anderson and in defence of his cross‑claim, comprises submissions of law which, according to Clambake, preclude Mr Anderson or Tipperary seeking or obtaining the relief which they claim. These are the issues of privity, res judicata, estoppel, and abuse of process which I have already briefly outlined and which were examined more fully in Clambake v Tipperary [No 5]. It is now necessary to identify them.

Points of law raised by Clambake

In support of its claim against Mr Anderson under the guarantee, and in defence of the cross‑claims for relief sought by Tipperary and Mr Anderson under ss 80 and 87 of the TPA and corresponding provisions of the FTA, Clambake submits that:
(1)the issue of Mr Anderson's liability to Clambake under the guarantee has already been finally determined adversely to Mr Anderson by the judgment in the rent action (Clambake [No 3]) and that this amounts to one or more of:
- res judicata;
- an issue estoppel;
- an Anschun issue estoppel;
-a result which may not be challenged because to do so would constitute an abuse of process.
(2)the liability of Tipperary to indemnify Clambake for the latter's liability to Owston arising from cl 4.01 of the lease as found in Clambake [No 3] is also a final determination by the judgment entered so that no relief against that liability may now be sought by Tipperary under the TPA or the FTA because of:
-a res judicata;
-an Anshun issue estoppel.
(3)insofar as the new counterclaim by Clambake against Mr Anderson for an indemnity of Clambake's liability to Owston by reason of cl 4.01 of the lease and Mr Anderson's obligations under the guarantee is concerned, notwithstanding that Mr Anderson was not a party to the fire claim, he is nevertheless bound to the same extent as Tipperary is bound by the judgment in that action, and for the same reasons as in subpar (2) above, because he should be regarded as a privy of Tipperary and, by that privity, precluded from challenging the corresponding claim against himself personally.
(4)alternatively, that Mr Anderson's liability under the guarantee is greater than that of an ordinary guarantor and extends to an obligation to make full indemnity and be answerable for the liability of Tipperary. Although not articulated in as many words, this submission implies that because of that obligation, Mr Anderson is obliged to be answerable for the liability of Tipperary even in circumstances, such as both Mr Anderson and Tipperary here allege, where Tipperary might not have been so liable had it raised and had determined a defence to the claim under cl 4.01 of the lease based on the provisions of s 80 or s 87 of the TPA or the corresponding provisions of the FTA.
(5)insofar as Tipperary or Mr Anderson seek relief under s 87 of the TPA, or the corresponding provision of the FTA, and might otherwise be entitled to receive such relief, relief should be refused because:
-such relief is discretionary and there are particular features of the case which should incline the court to refuse relief at the suit of either Tipperary or Mr Anderson in the exercise of that discretionary power; and
-the applicable limitation period for relief under s 87 of the TPA has expired before these claims (or defences) were recently introduced by Tipperary and Mr Anderson.
(6)alternatively to pars (2) and (5) above, Tipperary is not entitled to any form of injunctive relief under s 80 of the TPA because entitlement to such a relief is conditional upon damage likely to be suffered by misleading or deceptive conduct and, in the present case, the misleading and deceptive conduct found to have occurred has run its course, so there is no present risk that, unless Clambake is restrained, Tipperary or Mr Anderson will suffer or be likely to suffer further by that conduct.

Insofar as these defences rely on questions of res judicata, or varieties of estoppel including abuse of process, it is necessary to explore the nature and extent of those claims and the relief which Tipperary and Mr Anderson seek in order to determine whether or not any part of those claims is precluded by such a res judicata, estoppel or other like consideration.
Insofar as these issues were dealt with by the judgment in May 2009 (Clambake [No 5]) Clambake submits that that decision and the consequent orders amounted only to interlocutory relief on strike‑out applications, applications for a stay of proceedings and the refusal of an application for summary judgment, so that none of the orders made as a consequence of that decision in May 2009 resulted in any final determination of the issues which Clambake is now seeking to have determined in its favour. Tipperary and Mr Anderson submit that the reasons which led to the particular conclusions on the issues arising in the May 2009 judgment still hold good and should result in their defences to Clambake's claims being upheld and their cross‑claims for relief under the TPA and the FTA succeeding. It will be necessary to examine these contentions more closely.

The nature of the relief claimed under the Trade Practices Act

To put these conflicting claims and submissions in their context, it is useful to consider how the new claims under the TPA and the accompanying claims under the FTA, might have been resolved had there been no prior determination of those, or similar, issues or, in other words, if all considerations of res judicata, issue estoppel or abuse of process could be put to one side. Of course those issues cannot be sidelined but it is nevertheless a helpful step to consider what the outcome of those claims might have been, had those defences not arisen, before then turning to whether or not the earlier determinations prevent or limit the adjudication of the present claims of Tipperary and Mr Anderson based solely on facts established.

Relief sought by Tipperary and Mr Anderson under s 80 and s 87 of the TPA

Tipperary seeks relief under ss 80 and 87 of the TPA, and corresponding provisions of the FTA and Mr Anderson seeks similar relief to prevent the enforcement of cl 4.01 of the lease against Tipperary and the obligations by Mr Anderson under the guarantee to indemnify Clambake for Tipperary's obligations under cl 4.01 to indemnify Clambake for its liability to Owston as found in Clambake [No 3]. Essentially, the relief sought is designed to absolve or relieve Tipperary and Mr Anderson from the contractual obligations which would otherwise arise under cl 4.01 of the lease and from Mr Anderson's obligation to answer for Tipperary's liability by reason of the guarantee. The relief sought is for orders designed to vary the terms of those contracts or to refuse enforcement of part or all of the contracts, so as to relieve Tipperary and Mr Anderson of the contractual obligations, extended to the latter by his guarantee, to meet the obligation to indemnify Clambake under cl 4.01 of the lease.
Reliance upon ss 80 and 87 of the TPA, and equivalent provisions under the FTA, necessarily assumes that, without such relief, Tipperary and Mr Anderson are contractually bound to indemnify Clambake for its liability to Owston which (so far as concerns Tipperary) I found to be established by the March 2009 judgment in Clambake [No 3]. But that assumption is not conceded, or at least not fully conceded by Mr Anderson. It was, however, a finding which I made in the fire claim in the March judgment against Tipperary ‑ see reasons in Clambake [No 3] at [520] to [522]. Tipperary nevertheless submits that those findings are wrong and that the proper construction of cl 4.01 of the lease does not lead to any such liability against it. However, as I observed in Clambake [No 5] those findings have been made and judgment and orders accordingly have been entered and made against Tipperary in favour of Clambake in the fire claim. That issue has therefore passed into a res judicata (see pars [37], [75] and [79] in Clambake [No 5].
Mr Anderson was not a party to the fire claim or to Clambake's counterclaim including its claim for indemnity under cl 4.01 of the lease when those proceedings were heard, and when judgment was given and orders made. Accordingly, he submits, in my view correctly, that he is not bound by that judgment and is entitled to have those issues determined as between himself and Clambake on the merits. This has given rise to Clambake's contentions that Mr Anderson is estopped from contesting those issues, and is also bound by the finding against Tipperary because he was a privy of Tipperary, or because he stood back and did not seek to intervene in, or contest those claims made by Clambake against Tipperary at the time when he might have done. I have considered elsewhere in these reasons, those submissions that Mr Anderson is bound by the judgment and orders already made in respect of these claims against Tipperary. I have concluded that he is not so bound and that he is, indeed, entitled to defend those on the merits, notwithstanding that the question of construction of cl 4.01 in the circumstances has already been determined adversely to Tipperary in Clambake [No 3].
Accordingly, I pass to the submissions advanced by Mr Anderson in support of his submission that cl 4.01 of the lease does not oblige Tipperary to indemnify Clambake for the latter's liability towards Owston and, consequently, that there is no liability by him under guarantee to answer the alleged liability by Tipperary. Mr Anderson submits that there are three reasons why cl 4.01 of the lease has no operation in relation to the judgment for damages under s 82 of the TPA which Owston has obtained against Clambake. These are:
(a)that on the proper construction of cl 4.01, the loss claimed by Clambake does not arise from or out of any occurrence at the leased premises;
(b)that upon its proper construction, cl 4.01 does not apply to Clambake's liability for misleading or deceptive conduct;
(c)clause 4.01 of the lease is void because in effect it purports to exclude liability for a contravention of s 52 of the TPA and is therefore contrary to public policy and is likely to defeat the object of s 52 of the Act.
Counsel for Tipperary and Mr Anderson accepts that Tipperary cannot advance these arguments because it unsuccessfully advanced them at the trial (see [521] of Clambake [No 3]). Counsel submits that, so far as Mr Anderson's present position is concerned he is free to advance all these arguments and that only the third was expressly rejected in Clambake [No 3] [521], but to that extent the judgment at the trial is erroneous.
Despite the implicit submissions on behalf of Mr Anderson that the first and second of these contentions were not determined at the trial, I consider that, in substance, they were. In my reasons in Clambake [No 3] [520] to [533], I treated the claim for an indemnity for a liability resulting from fire and the corresponding liability by Clambake to Owston in the fire claim, as an occurrence within the meaning of cl 4.01. The second contention that cl 4.01 does not apply to Clambake's liability for misleading or deceptive conduct is, in my view, no more than a different description of the same question raised by the first submission and in [521] I treated it as being within cl 4.01. In relation to the third submission that cl 4.01 of the lease is void or unenforceable because its effect is to defeat the operation of s 52 of the TPA, I also considered that that should be rejected. I addressed that issue in par [521].
Although Mr Anderson is free to have these questions determined afresh in this new claim against him, and I have accordingly considered his submissions without feeling bound or obliged to adhere to the former conclusion expressed in Clambake [No 3]in the proceedings between Clambake and Tipperary on that issue, I am satisfied that the clause does have effect and that it is not void or unenforceable. I proceed, therefore, on the footing that, as a matter of contract alone, Mr Anderson, under his guarantee to Clambake of the liabilities of Tipperary, is required to answer for the liabilities of Tipperary and to indemnify Clambake for its liability to Owston under the March 2009 judgment in the fire claim - Clambake [No 3].
Consequently, the pertinent question which arises is whether Mr Anderson has proved, the onus being upon him to do so , that this contractual liability which, unless the relief which he seeks is to be granted, he owes to Clambake, has been caused by misleading or deceptive conduct by Clambake. The conduct alleged to be misleading or deceptive is the same conduct relied upon by Owston for the decision which it took, by its controlling director Mr Anderson, to place its valuable collection of artefacts in the Claremont storeroom which had been leased by Tipperary and to allow them to remain there until the fire. Mr Anderson submits, and I accept, that that decision by Owston cannot, in any sensible practical manner, be separated from the simultaneous decisions of Tipperary and Mr Anderson to take the assignment of lease of the Claremont premises, to allow Owston to store the collection of valuables on the property, and of Mr Anderson to enter into the guarantee and to allow the collection of valuables to remain there until they were destroyed in the fire.
It was the destruction of the goods in the fire which led Owston to make its claim for damages against Clambake, and it was the threat of such a liability by Clambake to Owston, which caused Clambake to claim an indemnity under cl 4.01 of the lease against Tipperary, originally alone, and now, much later, against Mr Anderson. The question is whether, but for that misleading and deceptive conduct, Mr Anderson would be facing this potential liability as guarantor of Tipperary's liabilities to Clambake. Whether or not the 'but for' test of causation is the sole test for causation in this present case, I am satisfied that, in a real and practical sense, Mr Anderson would not be facing this potential liability had the misleading or deceptive conduct not occurred or if he had discovered the absence of an operational and compliant fire sprinkler system in the premises and caused Owston to remove the valuables and Tipperary to terminate the lease or the holding over tenancy. In other words I am satisfied that the contractual liability which Mr Anderson is now facing has been caused by the misleading and deceptive conduct of Clambake described in Clambake [No 3]. The next questions are what relief, if any, should be granted to Mr Anderson in light of that finding and whether or not relief should be refused or curtailed, as Clambake submits it can and should be, because of the submission that relief under s 87 of the TPA is discretionary.

Relief available under s 87 of the TPA

Under s 87(1) of the TPA a court may make such order or orders as it thinks appropriate against the person who engaged in conduct in contravention of s 52 if the court considers that the order or orders concerned will compensate the party who has suffered, or who is likely to suffer, loss or damage by that conduct, in whole or in part for the loss or damage or which will prevent or reduce the loss or damage. Similar orders may be made under s 87(1A). Without limiting the breadth or scope of the orders which may be made under either ss 87(1) or 87(1A) any of the orders referred to in s 87(2) may be made, including:
(a)an order declaring the whole or any part of a contract made between the person who suffered, or is likely to suffer, the loss or damage and the person who engaged in the conduct or a person who was involved in the contravention constituted by the conduct, or of a collateral arrangement relating to such a contract, to be void, and if the court thinks fit, to have been void ab initio or at such times on and after such date before the date on which the order is made as is specified in the order;
(b)an order varying such a contract or arrangement in such manner as is specified in the order and, if the court thinks fit, declaring the contract or arrangement to have had effect as so varied on and after such date before the date on which the order is made as is so specified;
(c)an order refusing to enforce any or all of the provisions of such a contract.
An example of a variation of a contract pursuant to the powers contained in s 87(2)(b) of the TPA is found in ASX Operations Pty Ltd v Pont Data Australia Pty Ltd [No 1] (1990) 27 FCR 460, a decision of the Full Court of the Federal Court (Lockhart, Gummow and Von Doussa JJ), although that was a case where performance of a contract according to its terms would have had the effect of substantially lessening competition in contravention of ss 45 and 46 of the TPA. The nature of the relief, if any, to be granted under s 87 was therefore reserved for further consideration. The extent of the relief granted under s 87 was dealt with in the subsequent hearing, ASX Operations Pty Ltd v Pont Data Australia Pty Ltd [No 2] (1991) 27 FCR 492 where, at 503, the court referred to a degree of reluctance to rewrite contractual provisions as to price evident in the anti‑trust laws of the United States although their Honours remarked that this may not translate to the position in Australia before saying:
No doubt, in a case such as the present, the court has power under s 87 to vary the contract in question, even as to matters of price payable thereunder. Nevertheless, the court must be slow to impose upon the parties a regime which could not represent a bargain they would have struck between them.
These considerations do not apply in the present case because no question of further performance of this lease or of the obligations under it guaranteed by Mr Anderson arises. Unlike the ASX v Pont Data (supra) litigation the focus in the present case is retrospective and any orders which might be made under s 87 will not affect the future commercial relationships between Clambake and Tipperary or, for that matter, with Mr Anderson.
The breadth of the powers of variation under s 87(2) of the TPA were also examined in Trade Practices Commission v Milreis Pty Ltd (1977) 29 FLR 144 where the Full Court of the Federal Court rejected a demurrer contending that s 45 and s 87 of the TPA were beyond power and invalid. The powers of a court under s 87 do not involve the application of common law concepts: Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494 [24] and [116] and Murphy v Overton Investments Pty Ltd (supra) [44] and Master Education Services Pty Ltd v Ketchell (2008) 249 ALR 44 [28]; [2008] HCA 38; (2008) 236 CLR 101, 113.
A comprehensive review of the conditions for and the purpose of the exercise of the remedial powers under s 87 of the TPA was undertaken in Tenji v Henneberry & Associates Pty Ltd [2000] FCA 550; (2000) 98 FCR 324 ‑ see French J (as the Chief Justice then was) at [5] ‑ [14]. Similarly, in Warwick Entertainment Centre Pty Ltd v Alpine Holdings Pty Ltd [2005] WASCA 174; (2005) 224 ALR 134 the Court of Appeal in this State also addressed the scope of the remedial powers under s 87 ‑ see per Steytler P at [66] ‑ [79]. In doing so, the learned President said:
The section has been described by the High Court as conferring a wide discretionary power on courts to make remedial orders in appropriate cases in order to ensure a fair result: Kizbeau Pty Ltd v WG & V Pty Ltd (1995) 184 CLR 281 at 298. The power is broader than that provided for under the common law or in equity and the scope of the orders available is not to be constrained because, in particular cases, they may resemble common law or equitable remedies… [67]
Applications for relief under s 87(1) are not subject to any explicit time limit or limitation period but can only be made in the course of proceedings which themselves are instituted within any particular relevant limitation period. By contrast, applications for relief under s 8(1A) are subject to a six‑year time limit as contained in s 87(1CA). The potential significance of limitation issues is addressed later in these reasons.
As observed in [60] of Clambake v Tipperary [No 5], the defence raised by Mr Anderson and his cross-claim, both under s 87, do not contend that his guarantee is void or unenforceable for all purposes or ab initio. The plea is, in effect, that insofar as the guarantee purports to render Mr Anderson liable for obligations of Tipperary which arise because of the consequences of the fire, it is ineffective or should not be enforced because of the alleged misleading and deceptive conduct. In [61] of those reasons I observed that this acknowledges that the relief sought by Mr Anderson under s 87 would involve only a partial diminution in the effect of the guarantee and then only be related to the consequences of the fire, leaving it valid and enforceable in relation to other non‑fire related claims such as rent. In that paragraph I noted that it was the capacity of the remedy under s 87 to modify partially the effect of the contractual obligation, otherwise resting upon Mr Anderson under the guarantee and cl 4.01 of the lease, which distinguishes these present pleas by him in answer to the claim on his guarantee from the finding that he was liable on the guarantee in the rent action.
Clearly enough, under the lease and the holding over provisions Tipperary enjoyed the benefit of exclusive possession of the rented premises from the date of the assignment up until the date of the fire when, the parties agreed, the benefits and obligations of such possession ceased. Accordingly, the obligations, of Tipperary, and also of Mr Anderson under his guarantee of Tipperary's obligations, continued and remained in respect of that possession for all periods during which Tipperary occupied the premises. Neither Tipperary nor Mr Anderson ever suggested the contrary in the rent action. For that reason it would be quite wrong to declare that this lease and/or the guarantee was entirely void either ab initio or from any selected date, such as the date of the fire, onwards. Obligations arising from the enjoyment of possession continued and resulted in the judgments in the rent action against Tipperary and Mr Anderson.
When it comes to the consequences of the fire, however, the position is different. It is the losses which Owston suffered as the result of the destruction of its property by the fire which have resulted in the judgment for damages against Clambake. The present claim against Mr Anderson is for him to indemnify, by reason of the guarantee, Tipperary's obligations to Clambake under cl 4.01 of the lease for that liability to Owston. Accordingly, the putative liability of Mr Anderson under the guarantee presently being asserted by Clambake is as much a consequence of destruction of property by the fire, itself caused by the misleading and deceptive conduct, as is the destruction of Owston's property. That being so, I am satisfied that relief can and should be granted under s 87 sufficient to prevent Mr Anderson from suffering that damage or which will have the effect of compensating him for it if he were to suffer that damage.
This is best achieved by making an order that Mr Anderson's obligation to guarantee the liabilities of Tipperary under the guarantee does not extend to any liability to indemnify Clambake for the liability of Tipperary to pay moneys to Clambake pursuant to cl 4.01 in respect of Clambake's liability to Owston as found in the fire claim in Clambake [No 3]. Whether this remedy takes the form of a declaration; or an order varying the contract or an order refusing to enforce any particular provision of the contract is of secondary importance. However, to meet the requirements of the present claims, and to avoid the possibility that there may be some different type of liability of Mr Anderson to Clambake under the guarantee, it is desirable to restrict the remedy to this occasion and to this particular liability.

Expressing the remedy in that fashion in the claims by Mr Anderson leaves for separate treatment the question of whether or not Tipperary is entitled to any comparable relief whether under s 87 or s 80 of the TPA or otherwise. That involves other questions because judgment has already been entered on Clambake's counterclaim in the fire action requiring Tipperary to indemnify Clambake from the latter's liability to Owston in reliance upon cl 4.01 of the lease. It is at this point that issues of res judicata and estoppel become of critical importance.
However, again for the moment putting those issues to one side, the question which arises is what would be the result if Tipperary were now free to seek relief pursuant to s 80 or s 87 of the TPA against the claim by Clambake for an indemnity under cl 4.01 of the lease for the latter's liability to Owston. Perhaps the question is better posed on the artificial hypothesis of how such a claim might have fared had it been raised by Tipperary in the latter's defence to Clambake's counterclaim in the fire claim and so had arisen for determination in the joint trial.
For the same reasons which satisfy me that Mr Anderson would be entitled to relief under s 87 on the pleas which he has made in the new action against him, I consider that Tipperary would have been entitled to similar relief fashioned to its position had a s 87 plea then been raised. The reasons are plain enough. Although Tipperary derived the advantages of possession of the premises from the date of the assignment of the lease until the date of the fire, and had corresponding liabilities to pay rent, outgoings and other moneys payable under the lease in connection with that possession, its contractual obligation under cl 4.01 of the lease to indemnify Clambake for the latter's liability to Owston arose in this instance only because of the destruction of Owston's property by the fire. That liability would not have occurred but for the misleading and deceptive conduct of Clambake which was established in the fire claim. That being so, Tipperary's liability to indemnify Clambake under cl 4.01 of the lease is as much the result of the misleading and deceptive conduct of Clambake as was the destruction of Owston's property by the fire. The entitlement to relief under s 87 having been so established, on this artificial hypothesis, the question would be what relief, if any, should be granted. Again only partial modification of the contractual obligations would be justified and for the same reasons as apply in the case of Mr Anderson. I consider that the appropriate relief would have been to order or declare that Tipperary's obligation to indemnify Clambake under cl 4.01 did not extend to Clambake's liability to pay damages to Owston as established in the fire claim.
Having identified the relief to which Tipperary might have been entitled had the proceedings taken a different course, it becomes possible to address the controversy now raised both by Clambake and Tipperary over whether or not, notwithstanding the judgment against Tipperary in the fire claim, Tipperary may yet obtain the same or similar relief against Clambake under s 87 or, just as effectively, by obtaining an injunction under s 80 of the TPA to restrain Clambake from proceeding with the enforcement or recovery of the judgment already entered against Tipperary.
In [37] of Clambake [No 5] I observed that counsel for Tipperary effectively accepted that, short of a successful appeal, that company was bound by the decision that it must indemnify Clambake as I had declared it was liable to do. I went on to consider whether or not there was any incongruity in the possibility that Mr Anderson might succeed in a s 87 claim against Clambake to which Tipperary was not entitled, because of the earlier decision, leading to the conclusion that there would be no such incongruity. In [42] of Clambake [No 5] I also observed that Tipperary's liability to indemnify Clambake for its liability under the judgment in favour of Owston had been decided by the judgment already entered. Paragraphs [53] and [75] are to the same effect.
Tipperary seeks to meet this daunting obstacle in two ways. First, it submits that it would not have been possible for relief such as it now seeks pursuant to s 87 to have been granted in the fire claim, even if it had been sought, because up until the point of judgment in favour of Owston against Clambake there was no actual liability of Clambake to Owston and therefore no cause of action by Clambake against Tipperary under cl 4.01 until that liability had been established. It submits that no such cause of action having, up to that point, accrued no claim could have been brought or relief granted in favour of Tipperary under s 87. In this respect it submits that, up until the point when judgment was entered, there was no more than a contingency that Tipperary might be required to indemnify Clambake pursuant to cl 4.01 of the lease ‑ Murphy v Overton Investments Pty Ltd (2004) 216 CLR 388, 410 [55] and Wardley Australia Ltd v State of Western Australia (1992) 175 CLR 514, 532 ‑ 533. Tipperary submits, and it is undoubtedly the case, that Clambake strenuously contested the claim against it by Owston that it was liable for damages under s 82 of the TPA or otherwise for the destruction of Owston's property in the fire. Unless and until such a liability by Clambake to Owston had been established or admitted, there could be no basis for Clambake claiming against Tipperary for an indemnity under cl 4.01 of the lease: see Wardley and the other authorities referred to in [52] of Clambake [No 5].
The second answer offered by Tipperary is that even though the claim by Clambake against Tipperary under cl 4.01 of the lease may have passed into judgment, it is still open for the court to restrain the enforcement of that judgment by an injunction under s 80 of the TPA. Clambake replies that the power to grant injunctions under s 80 is limited to the prevention of a repetition, or the continuation, of the misleading and deceptive conduct and that this is certainly not a factor now.
This view that the power to grant an injunction under s 80 needs to be related to conduct which would or might involve a contravention of the provisions of the TPA is established in Foster v Australian Competition & Consumer Commission [2006] FCAFC 21; (2006) 149 FCR 135 where, at [35] the court comprised by Ryan, Finn and Allsop JJ said:
In our view, the need, suggested by the authorities, for a nexus between the contravention of the Act which the Court has found and the terms of the restraint which it then decides to impose is a specific reflection of Lockhart J's insistence that the power be exercised 'judicially and sensibly' [ICI v Trade Practices Commission (1992) 38 FCR 248]. It goes to the appropriateness of the relief contemplated by the concluding words of s 80(1) not to the extent of the power to grant it. If the Court considers that a complete prohibition, whether permanently or for a specified period, on a respondent's engaging in a particular field of commercial activity or industry is required to protect the public from conduct of the kind which constituted the contravention, s 80 is wide enough to support such a prohibition as a matter of power. This analysis of s 80 conforms, we consider, with that recently undertaken by Goldberg J in Australian Competition & Consumer Commission v Dermalogica Pty Ltd (2005) 215 ALR 482 at [110].
I adverted to this issue at [50] of Clambake [No 5] but only insofar as it related to the claim by Mr Anderson for relief under s 80 in the form of an injunction. There I expressed the provisional view that it seemed unlikely that Mr Anderson could expect to succeed in obtaining an injunction under s 80 because the jurisdiction so conferred involved the prevention of conduct engaged in, or which was proposed to be engaged in, which would constitute a breach of s 52. I went on to observe that the misleading and deceptive conduct relied on by the Anderson parties was all in the past and that it could not be suggested that, by pursuing its contractual claim for damages or indemnities, Clambake was engaging in or proposing to engage in conduct which was misleading or deceptive. Those observations did not directly address the question of whether or not an injunction could be granted which would have the effect of restraining Clambake from proceeding to enforce the liability of Tipperary to indemnify it under cl 4.01 which was the subject of the judgment in Clambake [No 3]. However, even to suggest this reveals that the remedy sought would amount to a complete modification (indeed, a negation) of that judgment and on grounds which might have been raised but which were not raised in the proceedings which led to that judgment. See also s 24(5) Supreme Court Act 1935 (WA). Relief in the form of stay of proceedings rather than an injunction could have been sought on these grounds in the course of the trial of Clambake's counterclaim in the fire action.
The reference to whether or not a claim for relief under s 87 had accrued due to Tipperary before the March 2009 judgment is, however, inconclusive. In [78] of Clambake [No 3] I concluded that Clambake was entitled to an order that it be indemnified by Tipperary for the extent of the liability which it had to Owston, namely $14,625,400 [before interest] and that Clambake should have judgment against Tipperary for such an indemnity and judgment was entered for Clambake against Tipperary for such an indemnity. That decision was reached and that judgment entered in circumstances where the only issue in contest concerning Tipperary's liability to indemnify Clambake under cl 4.01 concerned the proper construction of that clause of the lease. No limitation defence had been raised, no point of law was relied upon to contend that such a judgment would, in those circumstances, have been premature or that there was a potential claim under s 87 which might lead to the rejection of the contractual liability.
In fact, in its pleadings in the fire claim Tipperary had referred to s 87 by paragraph C of the prayer for relief in the statement of claim as finally amended. That was secondary to claims for damages under s 82 of the TPA, alternatively s 79 of the FTA and so claimed other relief under s 87 of the TPA. But the plea was not advanced in any way in relation to, or in defence of, a claim for indemnity by Clambake under cl 4.01 of the lease. There was no plea by Tipperary before the judgment of March 2009 nor any submissions on behalf of Tipperary at the joint trial that Clambake's claim for an indemnity against it pursuant to cl 4.01 of the lease could be, or might be, countered by relief obtained by Tipperary under s 87 of the TPA.
I consider that it would have been open to Tipperary to advance a defence and/or a counterclaim based on s 87 of the TPA to Clambake's counterclaim for an indemnity under cl 4.01 of the lease in the fire claim. The simple fact is that this was not done and, in the absence of such a plea, judgment has been entered in favour of Clambake against Tipperary on that claim for an indemnity. This situation falls squarely within the rule in Henderson v Henderson [1843] 67 ER 313, 319 and Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589, 602.
For these reasons I consider that Tipperary is precluded from seeking or claiming relief under ss 80 or 87 of the TPA, or corresponding provisions under the FTA, against Clambake and that its attempt to do so must be refused and those claims dismissed.
This brings me to consideration of the submissions by Clambake to the effect that Mr Anderson is precluded from pursuing his claims for relief under s 87, set out in his defence and in his counterclaim, for reasons of res judicata, estoppel or abuse of process. Although the contentions are set out rather more fully in the written submissions for Clambake, the essential propositions reduce to these:
(a)the judgment in favour of Clambake against Tipperary and Mr Anderson in the rent action conclusively established that Mr Anderson was liable on the guarantee for all moneys payable by Tipperary under the lease and that this constitutes a concluded finding that he is obliged to indemnity any liability which Tipperary has since been found to have to Clambake under cl 4.01 in respect of the liability of Clambake to Owston under the judgment in the fire claim;
(b)the finding on Clambake's counterclaim in the fire claim that Tipperary is liable to indemnify Clambake for the latter's liability towards Owston under the judgment in the fire claim is binding on Mr Anderson either as a res judicata or as an issue estoppel because, in all the circumstances, Mr Anderson must be regarded as having been a privy of Tipperary and so bound by that result;
(c)alternatively, in this respect, for similar reasons it would be an abuse of process for Mr Anderson now to pursue a cause of action in his own name (whether by defence or cross‑claim), in reliance on s 87 which might lead to a judgment being entered in his favour that was inconsistent with the determination of the court that Tipperary is obliged to indemnify Clambake for the latter's liability to Owston;
(d)that Mr Anderson's claim for relief, or reliance upon s 87 as a defence, is time barred by virtue of the provisions of s 87(1CA) of the TPA;
(e)that relief under s 87 is discretionary and that there are features of Mr Anderson's position which should result in the court refusing any such remedies in the exercise of that discretion.
I shall address each of these matters in turn.

Res judicata ‑ Mr Anderson was found liable under the guarantee to indemnify Clambake in the rent action

The judgment in the rent action determined that both Tipperary and Mr Anderson, as guarantor, were liable to Clambake for various moneys which Clambake had claimed arising from Tipperary's possession of the premises before the fire. As set out in [199] of Clambake [No 3], Clambake's entitlement was to a money sum being the total of various components, namely base rent; outgoings; CPI increased rent; interest; and, deferred for future determination, costs associated with Tipperary's default in making payments. There was no defence to the rent claim advanced in reliance on s 87 of the TPA or other comparable provisions. The rent action was not in any way concerned with the existence of a liability by Clambake to Owston, or by Tipperary or Mr Anderson's alleged liability to indemnify Clambake for such a liability because of cl 4.01 of the lease. Had those issues been raised in the rent action and required determination, there would have been no need for the separate fire claim.
Because Tipperary and Mr Anderson acknowledged that they were liable, as a matter of contract, under the lease for so much of the monetary obligations as were properly payable by them up until their possession of the premises ended, the rent action was solely concerned with determining the extent of that contractual liability. The decision in the rent action stands as a final determination (subject of course to appeal) giving rise to a res judicata that both Tipperary and Mr Anderson are liable, respectively, under the lease and the guarantee for those money claims established in the judgment. However, as set out in [74] of Clambake [No 5], in the rent action there was simply no reason for Mr Anderson to attempt to resort to remedies under s 87 of the TPA. No issue about Mr Anderson's liability under his guarantee for a liability by Clambake to pay damages to a third party because of its misleading and deceptive conduct was ever addressed or determined in the rent action. As pointed out earlier, the determination of such an issue involves an additional dimension beyond identifying the strict contractual obligations by Mr Anderson pursuant to his guarantee of the lease. It involves a question of whether or not those contractual obligations should be varied, declared to be unenforceable or restrained pursuant to the powers of the court under s 87 of the TPA. That additional component was not, and could have been, addressed or decided in the rent action.
In his claim for relief under s 87 of the TPA Mr Anderson does not seek to suggest, nor could he suggest, that the contractual obligations arising from possession which he has to Clambake by virtue of his guarantee of the lease are other than was determined in the rent action. What he claims, however, is that because of Clambake's misleading and deceptive conduct those contractual obligations should not be fully enforced against him and that the court should vary, suspend or refuse to enforce those contractual provisions insofar as they would impose a liability on him which has been caused by Clambake's misleading and deceptive conduct. I accept the submissions advanced on behalf of Mr Anderson in this regard and am satisfied that there is no res judicata, issue estoppel or Anshun estoppel arising from the judgment in the rent action which prevents Mr Anderson from proceeding with the claim.

Privity, issue estoppel, Anshun estoppel or abuse of process arising from the judgment in the fire claim

Not until after judgment in the fire claim had been entered was Mr Anderson joined, by leave, as an additional defendant to Clambake's counterclaim. Even to describe that development in that fashion leaves the significance of the development rather imprecise. That form of language suggests that Mr Anderson was no more than an additional defendant to a counterclaim in litigation which had not, by that stage, been fully completed and that his presence was necessary 'to ensure that all matters in dispute in a cause or matter may be effectually and completely determined and adjudicated upon' ‑ RSC O 18 r 6(2)(b). That is not the position in this present case because, before the date of Mr Anderson's joinder, all issues in the fire claim had been finally determined (subject to appeal). Clambake's new claim against Mr Anderson was, in every respect, a new and distinct cause of action.
Clambake could have, and in other circumstances might well have, commenced fresh and separate proceedings against Mr Anderson to pursue its asserted right of indemnity against him under cl 4.01 of the lease which he had guaranteed. That right of Clambake to institute a fresh action, which, had it been pursued, would possibly have involved another trial ranging over much of the same evidence and so consuming great time and expense, was something to be avoided if practical measures could be agreed upon for such a course. The parties were content for the matter to be added on, as a sequel to the present litigation, in order to derive the advantages, such as they might be, of judicial familiarity with the issues and the evidence, and to utilise all the evidence which had been given at the joint trial supplemented, if at all, by such limited additional evidence as might be admissible on these new issues. As it has turned out, no further evidence has been adduced but that does not in any way detract from the fact that the present claims by Clambake against Mr Anderson, his defence of them and reliance upon ss 80, 82 and 87 of the TPA; other similar provisions of the FTA, and his corresponding cross‑claim are anything but fresh and distinct actions.
That does not mean that questions of res judicata, issue estoppel or Anshun estoppel are any less significant when raised in the fresh actions but it does emphasise the separation of this new claim and counterclaim from the issues which were determined by the judgment in the fire claim.
In [48] of Clambake [No 5] I explained how the new claim by Clambake against Mr Anderson seeking orders or declarations that as guarantor of the lease he is also liable to indemnify Clambake for its liability to Owston was a claim for an indemnity against a guarantor who was not previously a party to the action so that the question of cause of action estoppel or, I now add, Anshun estoppel, depended upon whether or not he was a privy of Tipperary in the fire claim. For reasons then set out, I then concluded, in [54], that there was no res judicata or cause of action estoppel preventing Mr Anderson from relying on a s 87 defence or cross‑claim. Again, as set out in [56], I concluded that no such res judicata or estoppel would apply to Mr Anderson unless he were the privy of Tipperary.

In Clambake [No 5] at [57] ‑ [79] I addressed those issues and examined the submissions and the authorities which have been cited to me in support of Clambake's submission that Mr Anderson was a privy of Tipperary and, accordingly, was bound by the judgment in the fire action that Tipperary was obliged to indemnify Clambake for the latter's liability to Owston. For the reasons there set out, I concluded at [79]:
Accordingly, I conclude that in relation to the new claims against him, Mr Anderson is not a privy in law to the interests of Tipperary and is not bound by my judgment declaring Tipperary liable to indemnify Clambake. Similarly, I conclude that no Anshun estoppel arises nor is there any reason to conclude that there is an abuse of process by permitting Mr Anderson to defend the claims brought by Clambake as guarantor of Tipperary's obligations to insure or as guarantor of Tipperary's indemnity.
In the course of this recent hearing counsel for Clambake inquired where I was disposed to make a preliminary ruling that my decision on these issues in Clambake [No 5] was final and conclusive, giving rise to a res judicata or issue estoppel rather than being, as counsel for Clambake submitted, an interlocutory decision made in the course of applications to strike out claims or stay proceedings or of a like nature.
In their written submissions counsel for Mr Anderson contended the contrary, submitting that the decision in Clambake [No 5] did not, in this case, involve an application for summary judgment to be determined on the General Steel (1964) 112 CLR 125 test but, rather, was an application to determine an issue between the parties and, even if only interlocutory, it would be an abuse of process to reagitate the same issue in the absence of changed circumstances ‑ Nominal Defendant v Manning [2000] NSWCA 80; (2000) 50 NSWLR 139. Mr Anderson also submits that an issue estoppel is created by the determination of an issue in proceedings although the issue is determined at a trial of a preliminary issue or at a separate trial which is interlocutory: Fidelitas Shipping Co Ltd v V/O Exportchleb [1966] 1 QB 630 per Diplock LJ at 642 in a passage expressly approved by the High Court in O'Toole v Charles David Pty Ltd [No 2] (1991) 171 CLR 232, 245 and 260, and also deriving support from the decision in Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478, 8.
At that point of this trial I declined to make any such ruling lest it might later emerge that to do so would pre‑judge this issue which, certainly, has many facets. I proceeded to hear full argument and have since considered the lengthy written submissions filed by Clambake on this issue, including, as they do, a review of many of the authorities cited or considered in Clambake [No 5] as well as a number of additional authorities. However, no new fact or circumstance has been identified which in any way suggests to me that I should reach any different conclusions than I did in Clambake [No 5].
Upon reflection I am satisfied that the submission advanced for Mr Anderson is correct, namely that the determination of this issue in the May judgment between the same parties, even though it was in the course of an interlocutory determination, is binding on them and could only be changed as a result of a successful appeal. However, even if it were open to me to reconsider my decision on this issue of privity, with the benefit of the further submissions, I would adhere to my decision that Mr Anderson is not to be regarded as a privy of Tipperary in connection with the determination of the issues in the fire claim. There is no issue estoppel, Anshun estoppel or abuse of process which prevents him from pursuing, independently in his own right, his claim for relief pursuant to s 87 of the TPA both in defence of this new claim against him by Clambake and in his corresponding cross‑claim.

Limitation issues

Clambake submits that by virtue of s 87(1CA) of the TPA any application under s 87(1A) may be made at any time within six years after the accrual of the cause of action which relates to the conduct. It also submits that, unlike s 82, relief under s 87 is available not only for actual loss or damage but for 'likely' loss or damage so that it was not necessary for Mr Anderson to have suffered any actual loss or damage before his right to seek relief under s 87 arose. It further submits that the contractual liability of Mr Anderson under the lease and guarantee arises from the terms of the lease and the guarantee and not 'by' conduct of Clambake so, in effect, submitting that the likelihood of loss or damage to Mr Anderson arose from the moment that he executed the guarantee in 1992. Alternatively, it submits that even if the cause of this likely loss was conduct engaged in by Clambake that ceased, at the latest, at the date of the fire in 2002, still more than six years before Mr Anderson's claim for relief under s 87.
The potential for a limitation plea to be made by Clambake was alluded to in Clambake [No 5] at [84] ‑ [86] and was one of the reasons for declining the application by Mr Anderson for summary judgment but, apart from noticing this potential, no decision was then made about the merits of any limitation plea.
To these submissions counsel for Mr Anderson responds by contending that Mr Anderson was only 'likely' to suffer loss 'by' Clambake's contravention of the Act once Clambake was held liable to Owston and a demand or claim was made against Mr Anderson on the indemnity in cl 4.01 of the lease which he had guaranteed. This, counsel submits, means that any potential loss was subject to those contingencies. Consequently, no claim for such a loss or relief in respect of it could be made until those contingencies occurred so that, by application of the rule in Wardley no cause of action under s 87 could have accrued before the judgment in the fire claim in March 2009 at the earliest. Mr Anderson's position essentially is that no cause of action under s 87 could have accrued until the claim was made against him under the guarantee by the amendment to the pleadings allowed by leave in March 2009. Counsel submits that the limitation period in s 87(1CA) runs from the time the contingency occurs and that the Wardley doctrine applies as demonstrated by the decision in Murphy v Overton Investments Pty Ltd (supra).
Furthermore, counsel for Mr Anderson submits that a six-year limitation period applies only to claims under s 87(1A) of the TPA and that there is no limitation period in the case of claims for relief under s 87(1). That is, indeed, the case but claims under s 87(1) as distinct from claims under s 87(1A) need to be made by a party to the particular proceedings being a party who has suffered or is likely to suffer loss or damage by conduct of another in contravention to the specified provisions of the Act. Mr Anderson submits that he has now been made a party to the fire action, which was commenced by Owston within time, and that as such he comes within s 87(1) and is not affected by the six‑year time limit applying to claims made under s 87(1A). However, I doubt whether that proposition can be fully accepted. He is not a party to the fire claim instituted by Owston but, rather, he is a new party to Clambake's counterclaim and then only because that is a new and distinct cause of action as I have previously set out.
Nevertheless, whether one looks at the counterclaim as it was originally framed, or treats its present character as being a new claim by Clambake, it still bears the character of a proceeding, and certainly Mr Anderson's cross‑claim is a proceeding, instituted under Part VI of the TPA in which the court has now found that Mr Anderson has suffered or is likely to suffer loss or damage by reason of the conduct of Clambake engaged in in contravention of the provisions of Part IV, so enabling the court to grant relief under s 87(1) including any of the orders in s 87(2). That being the case, no limitation period applies and Mr Anderson may seek and obtain such relief as the court considers is due.
However, even if I were to take the contrary view that Mr Anderson's present claims for relief under s 87 result from applications made by him which only come within s 87(1A), Murphy v Overton Investments (supra) demonstrates that loss is not necessarily singular or is not continuing. In point of law, as a guarantor or indemnifier, Mr Anderson did not become exposed to any liability under cl 4.01 of the lease in respect of Clambake's liability to Owston unless and until Clambake was adjudged liable to Owston in the fire claim, and that certainly did not happen until March 2009. Accordingly, Mr Anderson advances the submission that he would be entitled to bring a claim for damages under s 82 in order to obtain compensation for the loss or damage which he will or might suffer if he were to be found liable to indemnify Clambake under the claim which it is now, for the first time, advancing against him. In view of the approach to the questions of when such causes of action accrue adopted in Wardley (supra) and in Murphy v Overton Investments I do not consider that it is possible to conclude that Mr Anderson was likely to suffer loss or damage, in this respect, by the misleading or deceptive conduct of Clambake unless and until Clambake was found liable in damages to Owston. Even then no previous claim against him as guarantor of Tipperary's liabilities to indemnify Clambake by cl 4.01 of the lease had been made or foreshadowed. Therefore, I do not consider that it could be concluded that he was likely to suffer such loss or damage until a claim or demand was made against him. If anything, the introduction of the claim by Clambake for an indemnity against Tipperary under cl 4.01 by its counterclaim in the fire claim, without any corresponding claim or demand being made against Mr Anderson as guarantor in respect of the same alleged liability, suggests that it was not thought likely, at least at that point, that he might suffer loss or damage by reason of his liability under the guarantee. For these reasons, I consider that any cause of action which Mr Anderson has or may have had under s 87(1A) of the TPA did not accrue until judgment was entered against Clambake and in favour of Owston in the fire claim at the earliest. Mr Anderson's claim for relief in the action to which he has been newly joined and in his counterclaim has been advanced within time.
It follows that I reject the pleas and submissions by Clambake that Mr Anderson's claims for relief under s 87 of the TPA are time barred.

Discretionary refusal of relief under s 87

Clambake submits that relief under s 87 is discretionary and that there are reasons why the court should, in the exercise of its discretion, decline the relief sought. It advances that submission because of the following contentions:
(a)Mr Anderson should not have the benefit of a remedy which arises from a default by his company which, by his design, is without assets and remains without assets;
(b)Mr Anderson's conduct in refusing to pay rent for many years to the prejudice of Clambake and the beneficiaries of the unit trust of which it is trustee, reveals him to be unworthy of any indulgence;
(c)as an experienced businessman, Mr Anderson entered into the guarantee and the lease fully aware of the full legal effect that his signature carried with it in exposing him to personal liability.
There are some further dimensions to the submissions that relief should be withheld in the exercise of discretion but these, essentially, related to and are dependent upon, related contentions by Clambake concerning expiration of time, privity and issue estoppel and need not now be canvassed.
In answer to these submissions, Mr Anderson contends, by counsel, that the discretionary element of s 87 relates to the form of relief which may be granted rather than to a general discretion to withhold relief and that the purpose of the powers conferred on the court is to prevent or reduce loss or damage caused, or likely to be caused, by contravention of the Act. Further, counsel for Mr Anderson submits that, by its submissions, Clambake is seeking to be relieved from the effect of its own unlawful conduct and therefore attempting to benefit from its own wrong.
It has long been accepted that the powers conferred under s 87 are discretionary: Mister Figgins Pty Ltd v Centrepoint Freeholds Pty Ltd (1981) 36 ALR 23 (Northrop J at [56)) and Akron Securities Ltd v Iliffe (1997) 41 NSWLR 353. The proper exercise of this discretion requires the court to 'scan at least briefly' the 'remedial smorgasbord' on offer and, I would add, even to contemplate making a special order under s 87(1) fashioned to the particular circumstances of the case, if the types of orders contemplated by s 87(2) do not seem appropriate. In this case it was not suggested that I should adopt a remedy outside the scope of those referred to in s 87(2) or an order declaring that Mr Anderson is not liable under this guarantee to indemnify or to be answerable for Tipperary's obligations to Clambake under cl 4.01 of the lease. Relief of that nature is both ample and sufficient to prevent the loss or damage he would otherwise suffer. No authority was cited on behalf of Mr Anderson for the proposition that the discretion under s 87 was limited to the type of relief which may be granted by the court rather than to the question of whether any relief should be granted and I hesitate to accept that without fuller argument on the issue. It seems to me that there could possibly be cases in which the power to grant relief under s 87 is established but, nevertheless, there may not be occasion to employ the power ‑ as, for example, if damages were a sufficient remedy. I leave that question open on this occasion.
Nevertheless, none of the matters raised by Clambake is sufficient reason to refuse relief to Mr Anderson. On the findings made he is a person who will suffer damage if the contractual liability under the guarantee to answer Tipperary's obligations to indemnify Owston is enforced. Also on the findings his potential loss in that regard has been caused by misleading and deceptive conduct of Clambake.
Both Mr Anderson and Tipperary have been adjudged liable to pay to Clambake, with interest, all the moneys found to be properly due under the lease for the period of possession up until the fire. The interest component in that money judgment, at a high rate of interest agreed in the documents, is the agreed compensation for the delay in payment. Clambake is therefore entitled to its full measure of rights to payment under the lease and for other moneys relating to the possession of the premises under the lease. To refuse relief to Mr Anderson under his s 87 claim because of the history of the rent claim, would go far beyond any entitlements which Clambake has at law and would amount to an unjustified penalty.
As for the suggestion that Mr Anderson, could if he so chose, provide Tipperary with sufficient funds for it to satisfy the liability which it has been adjudged to have to Clambake under cl 4.01, that is not to the point. The limited liability of a corporation such as Tipperary is too obvious to need explanation. It was that limited liability which, no doubt, led to Clambake seeking and obtaining the guarantee and indemnity from Mr Anderson as it did in 1992. The fact that that guarantee cannot now be fully enforced in relation to this particular liability, because of the intervention of the court under s 87, is due to Clambake's contravention of s 52 of the Act. I am satisfied that there is no factor present which leads to relief for Mr Anderson under s 87 of the TPA being withheld in the exercise of discretion.

Application to discharge or vary order suspending enforcement of the judgment against Clambake in favour of Owston

In addition to the trial of the new claim by Clambake against Mr Anderson, Mr Anderson's cross‑claim against Clambake, and the associated matters involving Tipperary's claim for relief under s 80 of the TPA to restrain enforcement of the judgment that it should indemnify Clambake for the latter's liability to Owston, there are two other separate applications which were made and heard at this trial. One is Clambake's claim under s 8(1) of the Civil Judgments Enforcement Act 2004 (WA) for a higher rate of interest to be declared to apply on the judgment debt now owing by Tipperary and Mr Anderson in the rent claim. That is dealt with separately below. The other is, an application by Owston, made pursuant to the liberty to apply in the orders made on 20 May 2009, to discharge or vary the order suspending enforcement of the judgment in the fire claim in favour of Owston against Clambake.
Written submissions on that application were made on behalf of Owston and by Clambake. Affidavit evidence was also adduced comprising:
(a)an affidavit of JT Bishop sworn 17 November in support of the application to set aside the suspension order;
(b)an affidavit of A Luckhurst‑Smith sworn 17 November 2009 in support of the application to set aside the suspension order;
(c)a supplementary affidavit of JT Bishop sworn on 18 November 2009 in support of the application to set aside the suspension order;
(d)an affidavit of JK Condon sworn on 18 November 2009 in opposition to the application to set aside the suspension order.
The application by Owston is for an order entirely discharging the order suspending enforcement of that judgment or, alternatively for an order that it be discharged unless Owston's insurer undertakes to pay interest on the amount outstanding equal to the interest payable by Owston on certain specified liabilities to some of its secured creditors.
The history of the order suspending execution of Owston's judgment against Clambake is that the order was originally made on 20 March 2009 and then extended on 20 May 2009. The special circumstances found to exist and so lead to such an order, until the resolution of the outstanding claims to be determined at first instance or until further order, were:
(a)Clambake intended to appeal against the judgment holding it liable to pay damages to Owston.
(b)Tipperary intended to appeal against the judgment ordering it to indemnify Clambake for that liability by virtue of cl 4.01 of the lease.
(c)Although the identity between the parties is not exact, they are related and so the claims leading to the judgment and these liabilities are in effect reciprocal.
(d)If Clambake were to succeed in its appeals from the judgment in favour of Owston, there would be no basis for Tipperary to indemnify it for such an obligation.
(e)If the judgment against Clambake stands and Clambake succeeds in its claim for indemnity against Mr Anderson, then both he and Tipperary (as already adjudged), would be obliged to indemnify Clambake for its own liability to Owston. Satisfaction by Clambake of its liability to Owston under the judgment would be likely to consume all or most of the assets of Clambake and, if that were to occur, it is likely that Clambake would suffer irreparable damage if immediate enforcement of the judgment followed, notwithstanding that it might ultimately succeed in the appeals.
(f)Owston was pressing only for execution to the extent of $10 million representing the extent of its insurance indemnity available, but execution even to that extent might lead to problems with Owston's secured creditors' obtaining security over the proceeds of the judgment, leading to doubts about whether all those moneys could be recovered in the event of a successful claim by Clambake, either in the appeal or against Mr Anderson, if Owston's financial position were to deteriorate.
(g)There is no present risk that the $10 million insurance indemnity available for partial satisfaction of Clambake's liability to Owston will be jeopardised.
(h)Associated orders made in March 2009 restraining Clambake from disposing of, or further encumbering, any of its assets or making payments otherwise than in the course of business, subject to liberty to Owston to apply in this respect, were sufficient to protect the existing assets of Clambake from dissipation or loss by the judgment creditor.
(i)The potential for the overall financial obligations of the inter‑related parties to change significantly depending on the outcome of the issues remaining to be determined and of the pending appeals, meant that the situation was sufficiently special to justify and to warrant a continuation of the order suspending execution of the judgment in favour of Owston.

Those earlier orders were made in recognition of the need to proceed to the resolution of the outstanding major issues in the litigation as soon as practicable, so that if any of the parties should choose to appeal from any judgment or orders in the disposition of those outstanding issues, those appeals could probably be dealt with at the same time as the pending appeals.
Owston submits that there has now been a period of eight months' delay since the judgment of March 2009 during which it has been held out on the proceeds of its judgment against Clambake and, in particular, has been without access to the $10 million immediately available from Clambake's insurer. In the evidence contained in the affidavits, there is more detail about the financial pressures on Owston arising from claims by its secured creditors. These were described briefly in my reasons in Clambake [No 5] [97] ‑ [104] and in [11] ‑ [15], of my separate reasons in Clambake Pty Ltd v Tipperary Projects Pty Ltd [No 6] [2009] WASC 200, which deal with an unsuccessful application for an interlocutory injunction to restrain counsel and solicitors then appearing for Owston to act further in the proceedings.
Since then, as the recent affidavits show, a major programme has been initiated for the sale and realisation of all the major properties and other valuable assets of Owston. The affidavits contain details of the properties which have been put up for sale, arrangements for sale which are proceeding and of some recent sales. The material also indicates that by reason of orders made by the Family Court of Australia in proceedings between Mr Anderson and his wife, the control of the Warren Anderson Family Trust, and of Owston has, subject to prescribed terms and conditions, been placed in the hands of Mrs Anderson, for the purposes of realising all the assets of the company in order for the determination of the entitlements of the parties to those Family Court proceedings.
This lengthy and complicated course of sale and realisation is due to acts and circumstances not only of Owston, and the beneficiaries of the Warren Anderson Family Trust, but also to action by a variety of secured creditors. Although the Family Court orders originally called for the sale of all Owston's property, there has since been an agreement between the parties to the Family Court proceedings to allow the sale of certain valuable property in New South Wales, near the Blue Mountains, to be deferred in order to explore and develop plans for its subdivision and redevelopment. These proposals are thought likely to result in the realisation of a much higher selling price. Some of these arrangements have resulted in Owston obtaining new loans or paying higher rates of interest on existing loans so that its interest bills are now running at very substantial amounts.
Owston submits, not unreasonably, that in such circumstances it is now in urgent need of money to reduce these expenses and liabilities and to enhance the prospects that this large scale process of realisation will ultimately lead to a significant surplus being retained after an orderly programme of sales. A variety of other related facts is set out, all of which point to, and support, Owston's claim that it now has much greater need to realise on its available assets than it had before.
Owston also submits that under the terms of the present suspension order, there is little financial incentive for Clambake to proceed with an appeal which it has instituted or to facilitate the early resolution of the appeals instituted by Owston. According to Owston, this is because, the limit of Clambake's insurance indemnity is $10 million, whereas the judgment debt bearing interest is much greater than that with substantial interest accruing from day to day. Owston also submits that the limited financial information available about the net value of Clambake's assets indicates that even if those assets were fully realised to satisfy the judgment, there would still be insufficient to satisfy it in full. Accordingly, so Owston submits, notwithstanding that interest on the judgment in favour of Owston is continuing to accrue, Clambake is, in effect, enjoying the benefit of a de facto limitation of liability (to the extent of the present net value of its assets plus the $10 million insurance indemnity), leading to the conclusion that Owston will suffer ever increasing losses unless it can obtain prompt satisfaction, to the greatest extent possible, of the judgment presently in its favour.
Essentially, I accept that these submissions advanced by Owston are well‑founded but it is still the position that, in reality, all that Owston is presently pressing for is access to the $10 million insurance indemnity available to Clambake, as I understand it, pending the disposition of the appeals. While that money is definitely accessible, I consider that there is a risk that, if that money were paid to Owston, and immediately became charged by the various securities held over Owston's assets, difficulties may be encountered in recovering that money in the event that Clambake succeeded in its appeal. None of the parties contended that such potential difficulties were not a real possibility, nor were there any submissions as to how practical measures might be devised to counter them.
Accordingly, there is no alternative but to recognise that if any part of the judgment proceeds were to be paid by Clambake to Owston, there is a not insignificant risk that, if the appeals were to succeed, that money might not be recoverable. That is enough to demonstrate that payment of the insurance indemnity of $10 million may place those funds in jeopardy in the event the appeal succeeds. The same conclusion would follow in relation to the proceeds of the enforcement of the balance of the judgment against Clambake forcing the realisation and sale of its assets. In that case, if the appeal were to succeed and the moneys were to be repayable by Owston to Clambake, not only would there be this uncertainty over whether or not the moneys could be recovered from Owston or its secured creditors, but the effect of payment would have been to force the realisation of Clambake's only asset and the termination of its business, meaning that irreversible loss would follow in the event that it was concluded that the appeal should be allowed, the judgment set aside and the proceeds of the judgment returned to Clambake.
In recognition of these factors, Owston put forward its alternative application that Clambake's insurer should provide an undertaking that it would pay to Owston compensation in an amount equal to the interest being incurred by Owston on the judgment sum, following the conclusion of the appeals in these matters in the event that Clambake's appeal failed and, further, that Clambake should prosecute its appeal with expedition. The submission was that such an undertaking would ameliorate the prejudice suffered by Owston by the continuation of the suspension order in the event that Owston's judgment is affirmed by any appeal. Owston submitted that by s 15(5) of the Civil Judgments Enforcement Act, this court may, when or after making a suspension order, make any necessary ancillary or consequential order and could impose a condition on a party receiving the benefit of a suspension order. Owston also submitted that such powers existed as part of the court's inherent jurisdiction and were not limited by any of the provisions of the Civil Judgments Enforcement Act: Mansfield v Director of Public Prosecutions for Western Australia (2006) 226 CLR 486.
Counsel for Clambake submitted that the situation had not essentially changed from the time when the orders suspending enforcement of the judgment in favour of Owston were renewed on 20 May 2009. Clambake therefore submitted that the order suspending enforcement of the judgment should continue either until further order or pending the determination of the appeals in the fire action. Reference was made to the applicable principles stated in Eastland Technology Australia Pty Ltd v Whisson [2003] WASCA 307 [9]; Ardrey v Bartlett [2004] WASCA 256 [21]; Professional Services of Australia Pty Ltd v Computer Accounting and Tax Pty Ltd [2008] WASCA 222 [21] and Hodder v Hodder [2008] WASCA 236, which also confirmed that the discretion to suspend execution of a judgment pending an appeal, is unfettered.
No‑one has suggested that this case is not one of considerable complexity or that the appeals could be regarded as being wholly without any prospects of success. Without in any way derogating from the conclusions which have led to my various decisions in this case, I acknowledge that an appeal by Clambake from my decision holding it liable in damages to Owston for the value of the property destroyed in the fire should be regarded as fairly arguable. Similarly, I consider that I should acknowledge that even if that decision is upheld, decisions on further issues; including the decision that Tipperary is bound to indemnify Clambake for that liability by virtue of cl 4.01 of the lease; and my present decision that Mr Anderson should obtain relief pursuant to s 87 of the TPA, to the effect that the obligation for him to indemnify Clambake for Tipperary's obligation under cl 4.01 of the lease should be varied or not enforced in respect of this particular liability are also arguable issues.
Therefore, for these reasons in addition to those set out in [97] ‑ [108] of Clambake [No 5] I consider that the order suspending judgment should be continued but with a suitable variation to provide that the $10 million available on the insurance indemnity should be utilised in such a way as to return interest which would go to the credit of Owston in the event that the judgment in the fire claim is affirmed on appeal.
It was for these reasons that I ordered on the 18th day of November 2009 at the end of hearing the application to discharge the suspension order that:
(1)the existing suspension order should be renewed on the same terms for a period of 14 days;
(2)that the suspension order should be extended beyond that 14‑day period again on the same terms but on the further condition that Clambake or its insurer shall within that 14‑day period invest the sum of $10 million so as to return 6% per annum interest and such interest as accrued from the time of that investment should be added to the $10 million indemnity payable by Clambake's insurer, in satisfaction of the judgment in favour of Owston, unless that judgment is set aside or varied on appeal in which case any decision on the entitlement to all or any of that aggregate interest shall be reserved to the Court of Appeal;
(3)such further conditional suspension order shall remain in effect until further order;
(4)there be liberty to any party to apply on 24 hours' notice to set aside or vary the suspension order as now continued;
(5)the costs relating to the suspension order and its extension be reserved.

Clambake's claim to higher post judgment interest

In addition to the claims arising from the pleadings as amended and the fresh counterclaim against Mr Anderson, Clambake has also applied on summons pursuant to s 8(1) of the Civil Judgments Enforcement Act (2004) (WA) for an order or declaration that the rate of interest accruing on the judgment debt of 20 March 2009 in the rent action should be 17% simple interest per annum rather than the applicable interest of 6% determined by reg 4 of the Civil Judgments Enforcement Regulations 2005 (WA).
The basis for this contention is that, pursuant to cl 3.09 of the lease, Clambake was entitled to interest at the rate specified in the lease plus 2% on all moneys owing by the lessee that are unpaid in breach of the provisions of the lease for more than seven days, and that the rate in the lease was defined to be 'the greater of 15% and the general maximum rate from time to time charged by the Commonwealth Trading Bank of Australia for overdrawn accounts with a limit of less than $100,000', which was the rate of interest awarded on the outstanding arrears of rent and associated moneys from the respective dates of default until judgment in March 2009. Clambake submits that the interests of justice would not be served by an outcome which would see a creditor suffer substitution of a prescribed interest rate rather than the contractual rate owing on default by the judgment debtor: Mercantile Credits Ltd v McDowell [1980] 2 NSWLR 101; State Bank of NSW Ltd v Chia [914].
In response counsel for Tipperary and Mr Anderson submit that Clambake's rights with respect to interest are now merged in the judgment in the rent action and that Clambake now has a statutory right to interest and no longer any contractual right to interest. They also submit that nothing has been shown to justify or warrant a rate higher than the 6% interest ordinarily applicable on such judgments. Counsel for Tipperary and Mr Anderson also submit that Clambake has not sought to establish any entitlement to interest under the doctrine in Hungerfords v Walker (1989) 171 CLR 125. Further, counsel for the defendants in the rent action also submit that this new claim for interest should be rejected for another reason, namely that Clambake is seeking interest on interest because a large component of the judgment in the rent action (some $646,382.90 ($1,055,199 - $408,736.10)) consists of interest on moneys due from the date of default until judgment. Those defendants go further and submit that even interest at 6% should be restricted to so much of the judgment as excludes the component of pre‑judgment interest, but there was no application made in that respect.
Counsel for Clambake point to the provisions of s 8(1) of the Civil Judgments Enforcement Act as authorising such an application for a higher rate of interest to be made and allowed notwithstanding that judgment has already been entered. So far as is applicable, that section provides:
8. Interest on judgment sums
(1)Interest is to be paid on the unpaid amount of a judgment sum from the date of the judgment until the date on which the judgment sum is paid -
(a)at the rate prescribed by the regulations; or
(b)at the rate set by the court in the judgment or by an order made after the judgment is given.
Counsel assumed, and it was not contested, that none of the exceptions referred to in s 8(5) applies.
So far as I have been able to discover, there has been no occasion for this court to consider or pronounce upon the effect of s 8(1) of the Civil Judgments Enforcement Act so far, presumably, because this is relatively recent legislation. It is, in part, the product of a recommendation by the Law Reform Commission of WA in its report 'Enforcement Of Judgment Debts - Project 61' in April 1977. But the LRCWA report did not deal with this specific issue. I note the Hansard debates in the Legislative Assembly record that a member raised the question of whether or not s 8(1)(a) might have the effect that the provisions in any contract governing the rate of interest payable would merge in the judgment, with the result that the debtor would gain a benefit if the prescribed rate of the regulations were lower than the contractual rate, but apart from an observation by the Attorney‑General that the provisions of the clause might deal with that problem, the issue was not resolved.
Until the repeal of s 142 of the Supreme Court Act1935 (WA) by the Civil Judgments Enforcement Act and the enactment of s 8(1) of the latter Act, there was no statutory power for a court to award, or for a judgment creditor to recover, more than the prescribed rate of interest on a judgment from the date on which the judgment had been entered. The approach was that most contractual terms, which provided for a higher rate of interest on moneys owing, merged in the judgment. There were some exceptions but these were limited to instances where the contract itself provided specifically for the recovery of a higher rate of interest, even after judgment, until payment. These authorities revealed that, for a higher claim to post judgment interest to survive, the contract sued upon must state, specifically, that any judgment obtained for recovery of the debt should carry interest at the higher rate until payment in full and that this should form part of the judgment ‑ Re European Central Railway (1877) 4 ChD 33; Ex parte Fewing; Re Sneyd.(1883) 25 ChD 338; Arbuthnot v Bunsilall (1890) 62 LT 234; and Economic Life Assurance Society v Usborne [1902] AC 147.
There is no doubt that, at least until the passage of the 2004 Act, the standard approach, subject to the exception described, was that an entitlement to interest contained in some contract upon which a money judgment was founded would merge in the judgment and thereafter the only entitlement to interest would be to the statutory rate applying in a case of judgment debts. The exception was described by Fry LJ in Ex parte Fewings; Re Sneyd, 355 as follows:
Where there is a covenant for the payment of a principal sum, and a judgment has been obtained on the covenant for that sum, it is plain that the covenant is merged in the judgment, and, if there is a covenant to pay interest which is merely incidental to the covenant to pay the principal debt, that covenant also is merged in a judgment on the covenant to pay the principal debt. Of course, a covenant to pay interest may be so expressed as not to merge in a judgment for the principal; for instance, if it was a covenant to pay interest so long as any part of the principal should remain due either on the covenant or on a judgment.
So it is said that, owing to the merger of a cause of action in the judgment, interest in respect of a period after judgment can only be recovered under the judgment, as the judgment operates as a bar to a separate claim ‑ Re Central European Railway Co; Ex parte Oriental Finance Corporation (1876) 4 ChD 33 unless the agreement sued upon specifically provides that a higher rate of interest than the statutory rate is to be paid as well before as after any judgment ‑ Ealing Londonborough Council v L Isaac [1980] 1 WLR 932 CA and Halsbury's Laws of England (5th ed) vol 12 [1149]. For an example of a mortgage providing for payment of interest at a high rate creating a liability to pay which survived any judgment, see Mercantile Credits Ltd v McDowell [1980] 2 NSWLR 101. That case is also an example of the mortgagee/judgment creditor applying for an order that the judgment carry interest at the higher rate rather than at the statutory rate after it had recovered judgment against the guarantor where there was a special power for the court to do so ‑ rather similar to that now existing under s 8(1) of the Civil Judgments Enforcement Act ‑ and where that power was so exercised.
Counsel for Clambake also rely upon observations of Einstein J in State Bank of NSW Ltd v Chia (2000) 50 NSWLR 587 [914] ‑ [915] which resulted in the bank being awarded a high default rate of interest which, so it may be inferred, was greater than the statutory rate applying. However, it is not evident that the interest allowed in State Bank of NSW v Chia was for interest after, rather than before, the date of judgment or, even if it were, that the claim was supported by a special covenant to that effect in the bank's mortgage. I therefore do not consider that the decision in Chia's case bears directly on the issue now raised by Clambake.
In the rent action Clambake pleaded an entitlement to interest under cl 3.09 of the lease, which is set out in [54] of my reasons in Clambake [No 3]. However, that covenant does not provide for the special rate of interest which it fixes to be payable after any judgment is entered in relation to moneys claimed under the lease and, therefore, is not one of the types of covenant which would allow for post judgment interest at a higher contractual rate to be recovered as occurred in Mercantile Credits v McDowell (supra) or in Economic Life Assurance Society v Usborne [1902] AC 147. That being the case, there is nothing which entitles Clambake to circumvent the doctrine of merger. In other words, I conclude that under this covenant to pay interest the entitlement to interest at the contractual rate ceased at the date when judgment was entered and that thereafter the statutory rate applies. I do not see s 8(1)(b) of the Act as creating a general discretion in the court to provide for some rate of interest other than the statutory rate unless there is an entitlement in law or equity to such a higher rate of a kind which survives the pronouncement of judgment.

Obviously enough, s 8(1)(b) of the Civil Judgments Enforcement Act allows the court to direct that a rate of interest other than the statutory rate (whether higher or lower) should apply to the unpaid amount of a judgment. However, that does not derogate in any way from the established principle that a contractual right to interest will merge in the judgment unless the contract specifically provides for the different rate of interest to prevail even after the entry of judgment. In that exceptional case there will be grounds, namely the contractual obligations, to provide for the higher rate of interest, in displacement of the statutory rate, because of the specific agreement of the parties. In the absence of such an agreement there is no reason why the doctrine of merger should not take effect and so exclude any entitlement other than the statutory rate of interest from then on.
For this reason I consider that the claim by Clambake for interest at 17% on the moneys payable by Tipperary and Mr Anderson under the existing judgment in the rent action at 17% or some rate higher than the 6% statutory rate should be dismissed.

Summary of conclusions

For these reasons, therefore, I consider that the determination of the trial of the amended claim by Clambake against Tipperary and Mr Anderson and their cross‑claims, and the associated applications should be as follows:
(a)Tipperary's application for an injunction under s 80 of the TPA and for other relief preventing Clambake from enforcing the judgment against Tipperary on the counterclaim in the fire claim be and is hereby dismissed;
(b)Clambake's claim against Mr Anderson under the guarantee and indemnity for him to indemnify Clambake for the liability of Tipperary to Clambake for the latter's liability to Owston in damages payable as a result of Owston's fire claim be dismissed;
(c)on Mr Anderson's cross‑claim against Clambake for relief under s 87 of the TPA, there be judgment for Mr Anderson to the effect that it be declared and ordered that by reason of the misleading and deceptive conduct of Clambake, the contractual liability which he had under the guarantee and cl 4.01 of the lease to indemnify Clambake for its liability to Owston as adjudged in Clambake [No 3] shall not be enforced;
(d)on the application by Owston to discharge the order suspending enforcement of the judgment for damages in the fire claim in favour of Owston against Clambake, the present suspension order be continued as varied in the manner set out above; and
(e)Clambake's claim pursuant to s 8(1) of the Civil Judgments Enforcement Act for a higher rate of interest on the judgment debt payable by Tipperary and Mr Anderson in the rent action be and is hereby dismissed.
Counsel should confer with a view to agreeing upon a minute of orders to give effect to these decisions. If agreement is not possible counsel should submit minutes of the orders sought with submissions addressing the form of the orders proposed.