CITATION: DM DRAINAGE & CONSTRUCTIONS PTY LTD as Trustee for DM UNIT TRUST t/as DM CIVIL -v- KARARA MINING LTD [2014] WASC 170
CORAM: BEECH J
HEARD: 6 MAY 2014
DELIVERED : 19 MAY 2014
FILE NO/S: CIV 2410 of 2012
BETWEEN: DM DRAINAGE & CONSTRUCTIONS PTY LTD as Trustee for DM UNIT TRUST t/as DM CIVIL
Plaintiff
AND
KARARA MINING LTD Defendant
Catchwords:
Practice and procedure - Pleadings - Strike out application - Building and construction contracts - Global claims - Total cost claims - Whether arguable claim - Whether pleaded claim would embarrass, prejudice or delay the fair trial of the action
Rayney v The State of Western Australia [No 5] [2014] WASC 147
Walter Lilly & Co Ltd v Mackay [2012] EWHC 1773
BEECH J:
Introduction
The plaintiff (DM Civil) and the defendant (Karara) entered into a contract for DM Civil to construct a 135 km water pipeline. In very broad summary, in this action DM Civil claims that Karara resequenced and redesigned the project through various directions and variation orders, and claims sums said to be due under the contract, or damages.
Karara has applied to strike out DM Civil's statement…
Grounds of appeal
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
The case involved DM Drainage & Constructions Pty Ltd, who brought proceedings against Karara Mining Ltd for breach of contract, alleging that Karara Mining Ltd had failed to pay the full amount owed under their construction contract. The dispute was heard in the Supreme Court of South Australia. The central legal issue was whether the claim for an alleged total cost overrun, as pleaded by DM Drainage & Constructions, was arguable and should not be struck out. Specifically, the court had to determine if DM Drainage & Constructions' claim would embarrass, prejudice or delay the fair trial of the action.
The court considered the criteria for striking out a claim, focusing on whether the claim was arguable and if it would unduly prejudice the defendant's right to a fair trial. The court noted that while the claim was a global claim, it was still necessary to assess if the pleaded claim had any arguable basis. The court found that the claim, as pleaded, did not outline a clear basis for the alleged total cost overrun, nor did it sufficiently identify the grounds for the claim. Consequently, the court determined that the claim would likely prejudice the defendant, making it difficult for Karara Mining Ltd to mount a proper defence.
In light of these findings, the court decided to strike out the claim, as it was not arguable and would likely prejudice the fair trial of the action. The court ordered that the claim for total cost overrun be struck out and directed the parties to proceed with the remaining claims in the proceeding. The decision underscored the importance of ensuring that all claims in a pleading are both arguable and not likely to prejudice the defendant's right to a fair trial.