Coffey & Partners Pty Ltd v National Mutual Life Association of Australia Limited

[1990] HCATrans 306

A -!) AUSTRALIA C- J ->>~~.:~(I.!

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Brisbane No B37 of 1990

B e t w e e n -

COFFEY & PARTNERS PTY LTD

Applicant

and

NATIONAL MUTUAL LIFE
ASSOCIATION OF AUSTRALIA

LIMITED

First Respondent

JOHN CONNELL HOLDINGS PTY LTD

Second Respondent

CONASOC (OLD) PTY LIMITED

Third Respondent

Application for special leave

to appeal

Coffey 1 7/12/90

MASON CJ
TOOHEY J

McHUGH J

TRANSCRIPT OF PROCEEDINGS

FROM BRISBANE BY VIDEO LINK TO CANBERRA

ON FRIDAY, 7 DECEMBER 1990, AT 9.03 AM

Copyright in the High Court of Australia

MR S.C. WILLIAMS, QC:  May it please Your Honours, I appear

with my learned friend, MR W.A. MARTIN, for the

applicant which is the first defendant in the

action. (instructed by Morris Fletcher & Cross)

MR G.L. DAVIES, QC:  May it please Your Honours, I appear

with my learned friend, MR R.N. WENSLEY, appear for

the respondent plaintiff. (instructed by Quinlan

Miller & Treston)

MASON CJ: Yes, Mr Williams. Perhaps I should say, first,

that the Registrar has been informed by the

solicitors for the second and third respondents

that they have not filed an entry of appearance on

behalf of their clients and have no instructions to

appear at this hearing.

MR WILLIAMS:  Thank you, Your Honour. Your Honours, as this

appeal concerns the striking out of the plaintiff's

statement of claim, it is relevant to point out to

Your Honours that an application was made on Monday

of this week to effect substantial amendments to

that statement of claim. That summons is to be

heard on 13 December next.

MASON CJ: Yes, there is an affidavit on that that sets out

the material in relation to that.

MR WILLIAMS:  Yes, thank you, Your Honour. We seek to

proceed with the application in any event.

MASON CJ: Yes.

MR WILLIAMS:  Your Honours, in our submission, the claim by

the plaintiff against the first defendant and the other defendants is one in tort for pure economic loss by a subsequent purchaser of a building which,

purchased with knowledge of defective foundations,

and those defective foundations caused the damage

upon which the cause of action is based.

The position in so far as the existence of a

cause in such circumstances is, in our submission,

determined substantially in England by the

decisions in D & F Estates and Murphy v Brentwood

District Council.

MASON CJ: But it is not determined in this country, is it?

MR WILLIAMS: In our submission, it is not, Your Honour.

MASON CJ: Well, now, does that not immediately present a

difficulty to you in making this application
because these proceedings arise out of an

application to strike out the statement of claim.

MR WILLIAMS: That is so, Your Honour.

Coffey 2 7/12/90

MASON CJ:  Now, once it emerges that there is a real

question of fact or law, the application to strike

out the statement of claim must necessarily fail.

MR WILLIAMS:  Yes, Your Honour, if the test for the

determination of such questions in this application

is that propounded by Mr Justice Dixon in Dey's

case. If the - - -

MASON CJ: Or by Chief Justice Barwick in General Steel

Industries.

MR WILLIAMS:  We would submit, Your Honour, that in General

Steel Industries, Mr Justice Barwick indicated that in applications such as this the need to determine

questions of law even after extensive argument is

one of the factors which permits an application

such as this to proceed, when the question is one

of pure law.

MASON CJ: Well, can you point out to us where he says that?

MR WILLIAMS: Yes, Your Honour, if I may. Page 129.

MASON CJ:  Now, is it at page 130?

MR WILLIAMS: It is, Your Honours. At about point 4 on the

page, about six lines from the bottom of the first

paragraph, His Honour said:

On the other hand, I do not think that the exercise of the jurisdiction should be reserved for those cases where argument is unnecessary to evoke the futility of the

plaintiff's claim.

MASON CJ: True, but earlier His Honour had said once it

emerged that there was:

a real question ..... of fact or law -

at issue, that was the end of the application.

MR WILLIAMS:  Your Honour, we can only rely upon the

qualification that His Honour seems to have adopted

at the conclusion of that paragraph, where he went

on:

Argument, perhaps even of an extensive kind,

may be necessary to demonstrate that the case of the plaintiff is so clearly untenable that

it cannot possibly succeed.

MASON CJ: Yes, well, one can understand that in some cases

you may need that, but when this question has not

been determined in Australia, does it not

necessarily follow that it is a real question?

Coffey 3 7/12/90

MR WILLIAMS:  It is, Your Honour, yes, it is a very real

question, in our submission, and a question only

that Court can answer. ·

MASON CJ: True, but not a question that this Court can only

answer on proceedings commenced by an application

to strike out a pleading.

MR WILLIAMS:	No, Your Honour, we concede that.
MASON CJ:	And in cases of this kind there is much to be

said for the view that the Court should not
consider such a fundamental question, except in the

framework of facts as found or as admitted.

Take Anns for example; Anns is a typical example of

difficulties that arise in formulating fundamental

and general principles against a background which

do not include findings of fact or admitted facts.

MR WILLIAMS: With respect, Your Honour, for the purposes of

this application, every fact alleged in the

statement of claim is admitted and taken to be

admitted.

MASON CJ: That is only by virtue of a rule of pleading.

MR WILLIAMS: That is so, Your Honour. That is the very

nature of the application. It is in the nature of

a demurrer.

MASON CJ: Yes.

MR WILLIAMS:  The facts upon which Your Honours are asked to

determine the questions of law are admitted for the

purposes of the application, and we - - -

MASON CJ: True, but what I am saying to you is that if you

just regard the facts as alleged in the statement

of claim, that provides an inadequate framework for

the determination of questions of this kind.

MR WILLIAMS:  Your Honour, with respect again, the facts

alleged in the statement of claim are those upon

which the plaintiff seeks to rely. At the end of a
long and perhaps expensive trial, the plaintiff would ask for findings of facts in terms of the

facts alleged in the statement of claim.

McHUGH J: Yes, but you get a much better understanding of

the facts against the evidentiary background.

MR WILLIAMS: Yes, Your Honour.

McHUGH J: It is like reading a judgment before you turn to

the evidence. You read the evidence, it explains a

lot what is in the judgment.

Coffey	4	7/12/90
MR WILLIAMS:	Yes.	Your Honour, we accept that, but in the

context of these facts as pleaded, in our

submission, Your Honours are presented with

possibly the purist case upon which to determine

the questions of law, because there are no disputed

facts; the matters are admitted and the plaintiff

is deemed to have findings of all the material

facts which he alleges are material to the action.

In the context, Your Honours, in our submission, the questions of law can be determined in a pure

sense.

MASON CJ: Yes. MASON CJ: Yes.

MR WILLIAMS:  I take it from what Your Honours have said

that Your Honours do accept that there has not been

a determination of these matters in Australia;

that indeed there are, in our submission, competing

views in Australia which require the Court's

determination.

MASON CJ: Yes. For my part I am approaching it on the

footing that this question has not been resolved in

this country.

MR WILLIAMS:  Thank you, Your Honour. Indeed, Your Honour,

not only has it not been resolved, but the views

which have been expressed appear to be at odds in

some respects. One has the observations of

Mr Justice Brennan in Heyman's case which indicate

a strict test, in our submission, whereby a

subsequent purchaser of a building has no cause of

action against the builder.

MASON CJ:  I think you can proceed on the footing,

Mr Williams, that the Court is hearing the matter

on the assumption that the question whether a

plaintiff can recover for pure economic loss is a

substantial question and one of importance,

unresolved presently in this country.

MR WILLIAMS:  Thank you, Your Honour. In those

circumstances we can only ask Your Honours to allow

special leave to allow the matter to be resolved.

To repeat our submissions in brief detail, the

case is one where, in our submission, Your Honours

are presented with admitted facts, although not

with the assistance of evidence on those facts, but

with admitted facts which the plaintiff claims are

the only material facts in the action and at the

end of the trial could not claim findings of fact

in excess of those.

Coffey 7/12/90

In those circumstances, the question of law is

clearly raised and, in our submission, Your Honours

are able upon those facts to determine the question

of law.

TOOHEY J:  Would those submission hold good, Mr Williams,

if the amendments sought by the plaintiff were

allowed?

MR WILLIAMS:  Your Honour, if the amendments sought are

allowed in full it would not dispose of the case,

the argument that we propose would not dispose of
the case. There are other causes of action

proposed in the amended statement of claim but it

would still enable Your Honours to determine this

point. It does arise in the amended statement of

claim, as it arises in this statement of claim.

TOOHEY J:  Well what would be the consequence, to, as it

were, delete a cause of action?

MR WILLIAMS:  It would delete at least one cause of action

and the substantial cause of action, in our

submission, Your Honour. It would permit the case

to be heard in a much shorter time and at much less

expense to the parties. There is, indeed, no

certainty that all amendments will be allowed, in

our submission. This argument can be raised in

opposition to the amendments and in those cases
where other causes of action are now alleged there

are arguments based upon the limitation statute as

to whether those amendments should now be allowed.

If the argument is permitted to proceed to appeal, Your Honour, the case will certainly be shortened substantially and this area of the law,

of course, will become certain for the whole of

Australia.

TOOHEY J:  But it points up the difficulty of this Court

intervening at a stage when the pleadings are still

fluid, issues between the parties have not been

fully determined and that the best you could hope

for, perhaps, is to have some aspect of the case

determined in such a way as to reduce the length of

time the trial might take but not dispose of the

action in its entirety.

MR WILLIAMS: That assumes all amendments are allowed.

TOOHEY J: Yes.

MR WILLIAMS:  Yes, Your Honour. As we say, they will be

opposed and it is by no means certain that all

amendments sought will be allowed at this point

which is 10 years after relevant events and seven

years after the writ of summons was issued and, I

Coffey 6 7/12/90

think, the fourth amended statement of claim with

which the defendants have been presented in the

course of the action.

MASON CJ:  Yes. Is there anything else you wish to say,

Mr Williams?

MR WILLIAMS:  Those are our submissions, may it please the

Court.

MASON CJ:  The Court need not trouble you, Mr Davies. At

this stage of the proceedings in the Supreme

Court, it would not be appropriate for this Court

to determine the substantial and important question

of law sought to be raised which may, in any event,

not be decisive of the litigation.

The proposed appeal arises out of an

application to strike out the plaintiff's statement of claim and there may still be important issues of

fact to be resolved. The decision of the Full

Court not to strike out the plaintiff's statement of claim is, in the circumstances, not attended with sufficient doubt to warrant the grant of

special leave to appeal.	The application is
therefore refused.

MR DAVIES:	We ask for costs, may it please the Court.
MASON CJ:	Mr Williams, I take it you do not oppose an order for costs?
MR WILLIAMS:	I cannot oppose it, Your Honour.
MASON CJ:	The application is dismissed with costs.

AT 9.20 AM THE MATTER WAS ADJOURNED SINE DIE

Coffey 7 7/12/90