Dockpride Pty Ltd v Subiaco Redevelopment Authority

[2000] WASC 184

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   DOCKPRIDE PTY LTD & ANOR -v- SUBIACO REDEVELOPMENT AUTHORITY [2000] WASC 184

CORAM:   MASTER SANDERSON

HEARD:   12 JULY 2000

DELIVERED          :   19 JULY 2000

FILE NO/S:   CIV 1505 of 1999

BETWEEN:   DOCKPRIDE PTY LTD (ACN 081 380 967)

First Plaintiff

WESTPOINT CORPORATION PTY LTD (ACN 009 395 751)
Second Plaintiff

AND

SUBIACO REDEVELOPMENT AUTHORITY
Defendant

Catchwords:

Practice and procedure - Application to strike out parts of statement of claim - Turns on its own facts

Legislation:

Nil

Result:

Application successful in part

Representation:

Counsel:

First Plaintiff                :     Ms G S Pitt

Second Plaintiff            :     Ms G S Pitt

Defendant:     Mr S M Standing

Solicitors:

First Plaintiff                :     Williams & Hughes

Second Plaintiff            :     Williams & Hughes

Defendant:     Freehills

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

Nil

Case(s) also cited:

Blackpool & Fylde Aeroclub Limited v Blackpool Borough Council [1900] 3 All ER 25

Hooker Corporation v Commonwealth of Australia (1986) 65 ACTR 32

Hughes Aircraft Systems International v Airservices Australia (1997) 76 FCR 151

1. MASTER SANDERSON:  This is the defendant's chamber summons seeking to strike out certain paragraphs of the plaintiffs' reamended statement of claim.  The chamber summons, by its terms, sought to strike out the whole of the reamended statement of claim.  However, the complaint was essentially limited to par 14.6 to par 14.8 of the reamended statement of claim, together with par 15.3 and par 15.4.  The plaintiffs accompanied their outline of submissions with a minute of further reamended statement of claim.  Although amendments were made to the paragraphs about which the defendant complained, the amendments did not satisfy the defendant's concerns.  The matter proceeded on the basis that the defendant objected to the plaintiffs amending their statement of claim in terms of the minute of further reamended statement of claim.

2. To understand the nature of the defendant's objection to the proposed amendment it is necessary to say something about the nature of the action.  The defendant is a statutory authority responsible for the redevelopment of the Subiaco area.  In or about August 1997 the defendant invited expressions of interest from persons wishing to submit tenders for the purchase of land for the purpose of redevelopment.  The plaintiffs expressed interest and were provided with an information package.  This information package set out what was required of tenderers and incorporated certain draft design guidelines to be followed by the tenderers.

3. The second plaintiff submitted an expression of interest and was thereafter invited to tender.  The invitation to tender was accompanied by certain further documentation which is described in the pleading (par 7.2) as the "Tender Document".  Certain express terms of the Tender Document are pleaded (par 8).  The plaintiffs then plead (par 9) that, as a consequence of the tender document and the documents provided when expressions of interest were called, it was an implied term of the Tender Document that the design of the redevelopment would comply with the design guidelines.  Certain oral representations made by an agent of the defendant are then pleaded (par 10).  The plaintiffs then completed their tender and lodged it with the defendant (par 11, par 12 and par 13).  Paragraph 14 is then in the following terms:

   "14.By acting as pleaded at paragraphs 3 to 13, the Authority, Westpoint and/or Dockpride entered an implied contract, terms of which were that in consideration Westpoint and/or Dockpride preparing and submitting a tender:-

   14.1the Authority would only consider with a view to accepting, and accept, a tender containing plans for a design for the redevelopment, which complied with the Design Guidelines;

   14.2that the Authority would act fairly in considering competing tenders and, if the Authority decided (inter alia) that it would permit other tenderers to submit tenders containing plans for a design which did not comply with the Design Guidelines, it would inform each tenderer (including Dockpride) of that fact, and give each tenderer the opportunity to modify its design and plans comprised, or to be comprised, in its tender;

   14.3the Authority would accept the tender which:-

   14.3.1contained plans for the redevelopment which complied with the Design Guidelines;

   14.3.2offered the highest price;

   14.4the Authority would not accept a tender which did not offer the highest price in preference to a tender which:-

   14.4.1contained plans for the redevelopment which complied with the Design Guidelines;

   14.4.2offered a higher price;

   14.5the Authority would not, merely on the basis of a subjective preference for another design, fail to accept a tender which offered the highest price and which complied with the Design Guidelines;

   14.6the Authority would assess competing tenders by reference to the criteria contained in the Design Guidelines;

   14.7the Authority would not take and or accept advice in relation to the  merits of competing tenders from a person or entity which had a financial interest in the acceptance of a tender or who was related to, or connected with, a person or entity which had (1) a financial interest in the acceptance of a tender or (2) a connection with an entity which had a financial interest in the acceptance of a tender;

   14.8the Authority would not permit a person or entity which had a financial interest in the acceptance of a tender or who was related to, or connected with, a person or entity which had (1) a financial interest in the acceptance of a tender or (2) a connection with an entity which had a financial interest in the acceptance of a tender, to form part of the Tender Assessment Panel which advised the Authority which tender to accept."

4. Although objection was taken to par 14.6 it is difficult to see on what basis this objection is raised.  What par 14 raises is a plea of an implied contract.  It is not a plea of terms to be implied into a contract brought into existence in some other way.  That is to say, there is no question of the parties having entered into a written contract into which the plaintiffs say certain terms should be implied.  The defendant accepts that it is open to the plaintiffs to plead an implied contract and they accept that it is arguable if such a contract arose it contains the provisions as pleaded in par 14.1 through to par 14.5.  If that is so, and based upon what is pleaded in par 3 through to par 13, there does not seems to be any basis upon which it could be said that a term such as that pleaded in par 14.6 could not be part of the contract.

5. However, par 14.7 and par 14.8 are different matters.  As the statement of claim is pleaded at the moment there is no material fact pleaded which would justify such terms being included in the implied contract.  Counsel for the plaintiffs submitted during the course of argument that it was the status of the defendant as a statutory authority which led to these terms being included in the implied contract.  If that is the basis upon which it is said these terms are to be included in the implied contract then that must be made clear.  If it is made clear, then it seems to me the two sub‑paragraphs in their present form can stand.

6. Paragraph 15 of the minute pleads that in breach of the terms of the contract pleaded in par 14 the defendant accepted a tender from a competing tenderer.  By par 15.3 it is pleaded that the defendant decided:

   "15.3to accept advice from the Authority's Tender Assessment Panel (the Panel) (the Panel's Advice) in the knowledge that:

   15.3.1Graham Iddles, Keith Wilson and other persons (whose identity is yet unknown to the Applicant) who were employees of Chesterton International Pty Ltd (Chesterton) had given advice to the Panel;

   15.3.2Graham Iddles was a director of Chesterton;

   15.3.3Graham Iddles was a member of the Panel;

   15.3.4Bryan Mickle was a director of Chesterton;

   15.3.5Chesterton had advised the Panel generally in relation to the merits of the competing tenders and in particular had advised the Panel that it was questionable whether the proposal disclosed by Dockpride's tender was financially viable, and that Dockpride's tender should not be accepted;

   15.3.6Bryan Mickle was a director of Rockingham Park Pty Ltd (Rockingham Park);

   15.3.7Rockingham Park was a member of Blackburn Consortium;

   15.3.8The Panel's Advice was to accept the Blackburn Consortium's tender which was in a sum substantially lower than Dockpride's tender.

   15.4Westpoint and Dockpride say that:

   15.4.1The Authority should not have accepted the Panel's Advice;

   15.4.2The Authority should, on learning the facts pleaded at paragraphs 15.3.1 to 15.3.8, have constituted a different Panel to consider the competing tenders;

   15.4.3had the Authority constituted a different Panel to consider the competing tenders, Dockpride's tender would have been recommended for acceptance and accepted.

   PARTICULARS

   Dockpride's tender was the highest tender.  The particulars subjoined to paragraph 15.2 are repeated.  The Blackburn Consortium Tender did not comply with the Design Guidelines."

7. The defendant complains that it is not apparent how the matters pleaded in par 15.3 and par 15.4 are said to give rise to loss.  Further, the defendant says that it is not clear whether it is alleged that the persons referred to in par 15.3 demonstrated actual bias as a consequence of which the plaintiffs were not the successful tenderers.  The plaintiffs' response is in three parts.  First, they say it was an implied term of the contract as pleaded in par 14.7 and par 14.8 that persons with a direct financial interest in competing tenderers would not be part of a selection panel.  Second, it is said that, as is pleaded as in par 15.3, certain persons who were on the selection panel did have a direct financial interest in competing tenderers.  Based upon those facts it is then said that, as the defendant was aware of the interests of the persons on the selection panel, they should not have accepted the advice of the panel but they should have constituted another panel.  If they did that the plaintiffs say they would have won the tender.  In no way is it suggested that any of the persons mentioned in par 15.3 displayed actual bias or were engaged in some fraud.

8. Viewed in that way, I think par 15.3 and par 15.4 can stand.  Although the effect of these two sub‑paragraphs is not entirely clear on a first reading, I think that in line with counsel's submissions they do properly plead the plaintiffs' case.  I am satisfied both paragraphs should stand without amendment.

9. I will give the plaintiffs leave to make the small amendment necessary to ground the pleas found in par 15.7 and par 15.8.  Subject to that slight amendment, the minute can stand as the statement of claim.

10. I will hear the parties as to the precise form of the orders and as to costs.