Draper v National Australia Bank - [2007] SASC 194

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
DRAPER & ANOR v NATIONAL AUSTRALIA BANK
[2007] SASC 194
Reasons of Judge Burley a Master of the Supreme Court
31 May 2007
PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - PROCEDURE UNDER RULES OF COURT - PLEADINGS
Defendant's application to dismiss action - defective statement of claim - not in compliance with the Rules - whether pleading irretrievably vexatious - whether opportunity to seek leave to amend should be given - whether action should be dismissed.
Supreme Court Civil Rules 2006 Rules 98, 99, 104, 193 and 232, referred to.

DRAPER & ANOR v NATIONAL AUSTRALIA BANK
[2007] SASC 194

JUDGE BURLEY: By an application dated 13 March 2007 the defendant has applied for the following orders:
1That this action be dismissed.
2In the alternative to paragraph 1, that the statement of claim filed on 12 February 2007 be struck out.
The defendant relies upon Rule 193 of the Supreme Court Civil Rules 2006 which provides:
The Court may dismiss proceedings if –
(a)the pleadings disclose no reasonable cause of action; or
(b)the proceedings are frivolous, vexatious or an abuse of the process of the Court.
The defendant also relies upon Rule 232 which empowers the Court to give summary judgment for the defendant if the Court is satisfied that “there is no reasonable basis for the claim against the applicant”.
Rule 193 is concerned with the sufficiency of pleadings and consequently the Court assumes for the purposes of the application, the correctness of the factual assertions made in the pleading. There is therefore no room for the admission of contentious evidence on such an application.
On an application pursuant to Rule 232, affidavit evidence may be relied upon, but only to the extent there are no material disputes of fact between the parties. In this regard, the cases under Rule 25 of the 1987 Rules, which are to the effect that it is not open to the Court to resolve material disputes of fact between the parties based solely on affidavit evidence are equally applicable to the new Rule.
As I understand the defendant’s case for summary judgment, two undisputed facts are relied upon, namely the making of a sequestration order in the Federal Court and the granting of an order for possession of real property in this Court. The defendant relies upon the Court’s power in R 193 to dismiss proceedings (as opposed to striking out a pleading) and the power of the Court summarily to determine a case in the appropriate circumstances as conferred by Rule 232.
I should also mention Rule 104 which enables the Court to strike out a pleading in whole or part if the pleading does not comply with the Rules and is an abuse of process of the Court or it prejudices the proper conduct of the action. The defendant did not specifically rely upon this Rule either as a fallback position or otherwise but, in my opinion, it should be taken into account. For example, if I come to the conclusion that the pleading is deficient, the plaintiffs may have to be given the opportunity to apply for leave to amend the pleading in order to correct any defect in the current pleading. In this regard, I think the cases relating to applications to strike out pleadings which require the Court to give an opportunity to re-plead if a defect is capable of rectification by an amendment, apply to rule 104.
At the hearing of the defendant’s application, Mr Livesey QC appeared with Ms Thomson for the defendant and the plaintiffs appeared in person. Mrs Draper was in attendance in Court for some of the time but the submissions in support of the statement of claim were put by Mr Draper.
The statement of claim filed by the plaintiffs is a difficult document. To use counsel’s language, it is “replete with unparticularised assertions of fraud and forgery”. Mr Livesey submitted that there was no identifiable cause of action disclosed in the document, let alone a proper pleading of material facts relevant to any cause of action relied upon. There are obvious breaches of most of the requirements of Rules 98 and 99 which set out the requirements for pleadings. For example, paragraph 4 of the statement of claim asserts:
The guarantee dated the 21^st of August 1987 would be completely unnecessary as it is for the same amount as (c) and is therefore a forgery. Transparencies will be used to prove this and can be compared with signatures on the guarantees 5^th October 1987.
There is no point in setting out all of the offending passages in the statement of claim, the combination of which results in an entirely confusing document. Mr Livesey submitted that to the extent that any comprehensible claim was raised in the statement of claim, it was based on an assertion that the making of a sequestration order in respect of the male plaintiff, and the granting of an order for possession on a property formerly owned by the plaintiffs, were brought about by the wrongful conduct of the defendant. This, he submitted, was evident from the relief sought in Part 2 of the statement of claim which is as follows:
A compensation of $350,000 for the loss of the property and $500,000 for the loss of K L Draper’s tax licence thus depriving him of being able to practise as a tax agent and thus depriving him of income over a period of 15 years. We are also claiming pecuniary damages to be awarded by the Court and rent on the property at 5 George Street, Marleston as the bank allowed the purchaser to live in the property before settlement plus costs. We have LTO documents to prove the settlement. We have a further letter on 22 January 2007 which incriminates them in this matter.
If any sense is to be made of the relief sought, it must be inferred, from the allegations made in paragraphs such as paragraphs 33 and 34 of the statement of claim, that a possession order in respect of real property formerly owned by the plaintiffs was obtained fraudulently. It was also submitted by Mr Livesey that, to the extent that the plaintiffs claim damages for the loss of Mr Draper’s tax licence, this could only mean that the bankruptcy was wrongfully contrived by the defendant and, as such, caused the male plaintiff to lose income because he lost his tax licence as a result of bankruptcy. This is drawing a long bow; it is not at all clear that this is the effect of the statement of claim.
However that may be, it is clear to me that the pleading should be struck out as coming within Rule 104: on its face, it is an abuse of process, it does not comply with Rules 98 and 99 and it prejudices the proper conduct of the action. The question then remains as to whether the plaintiffs should be given the opportunity to apply to amend or whether the proceedings should be dismissed.
If, on the pleading as it presently stands, a potential cause of action may be discerned among the confusion, the plaintiffs should be given the opportunity to apply for leave to amend. However, if the pleading is irretrievably vexatious, the proceedings should be dismissed. I am unable to discern from the pleading the potential for an arguable cause of action. I agree with Mr Livesey that if there is any potential cause of action, it is based on the impugning of either the sequestration order or possession order. That may not be achieved without, in the case of the sequestration order, federal proceedings claiming an arguable entitlement to have the order set aside and, in the case of the possession order, proceedings in this Court claiming an arguable entitlement to have the possession order set aside. There are no such proceedings. In their absence, the statement of claim in this case is irretrievably vexatious. By a combination of Rules 193 and 232, the proceedings should be dismissed. .
For these reasons the plaintiffs’ action will be dismissed