Esanda Limited v Reutersward

[1991] TASSC 165

Serial No B51/1991
List “B”

COURT:  SUPREME COURT OF TASMANIA

CITATION:              Esanda Limited v Reutersward [1991] TASSC 165; B51/1991

PARTIES:  ESANDA LIMITED
  v
  REUTERSWARD, Benst Gustaf Pontus

FILE NO:  M179/1991
DELIVERED ON:  17 September 1991
JUDGMENT OF:  Zeeman J

Judgment Number:  B51/1991
Number of paragraphs:  11

Serial No B51/1991
File No M179/1991

ESANDA LIMITED v BENST GUSTAF PONTUS REUTERSWARD & ORS

REASONS FOR JUDGMENT  ZEEMAN J

17 September 1991

1. This is an application by the plaintiff for an extension of time in which to appeal against an order of the Master made on 26 March 1991 on the application of the third named defendant, Richard Anthony Hadley, whereby the plaintiff was ordered to deliver certain particulars.

1. The action in which the order was made was one brought by the applicant in which it claimed the sum of $88,427.80 against the defendants as guarantors of certain obligations of M Maloney Pty Ltd ("the company"). The statement of claim in the action contains the following paragraphs:

"3By a written Guarantee signed by each of the five named Defendants, the Defendants for the consideration set out therein jointly and severally guaranteed the payment by M Maloney Pty Ltd to the Plaintiff of, inter alia, all sums of money whatsoever from time to time owing or upaid (sic) by M Maloney Pty Ltd to the Plaintiff for and in respect of any indebtedness from M Maloney Pty Ltd to the Plaintiff by any means whatsoever together with interest on the said moneys at the rate payable in the documents pursuant to which the liability arises. The Plaintiff will rely on the full terms and provisions of the Guarantee at the hearing.

4On the 2nd day of July 1986 M Maloney Pty Ltd was indebted to the Plaintiff in the sum of $88,427.80.

5By reason the Guarantee referred to in paragraph 3 above the Defendants are jointly and severally liable to the Plaintiff in relation to M Maloney Pty Ltd's indebtedness."

1. The allegations contained in those paragraphs are either denied or not admitted in the defence. By consent, a copy of the guarantee referred to in par3 of the statement of claim was placed before me for the purpose of dealing with this application. The principal operative provision of the guarantee, which is addressed to the plaintiff and Esanda (Wholesale) Pty Ltd, both of which are in the guarantee called "Esanda", is in the following terms:

"WE, the undersigned ... RICHARD ANTHONY HADLEY ... IN CONSIDERATION of advances and/or cash credit accomodation (sic) and other finance facilities and/or leasing facilities and/or hire purchase facilities and/or bailment facilities and/or dealer facilities and/or any other facilities heretofore, hereon or hereafter granted or made by Esanda to M Maloney Pty Ltd ... (hereinafter called "the Borrower") DO HEREBY guarantee to Esanda payment of all moneys now or hereafter due and payable by the Borrower to Esanda whether such moneys become so due and payable under an agreement (of whatsoever nature) between Esanda and the Borrower heretofore or hereafter whilst this guarantee shall remain not discharged TOGETHER WITH interest on the said moneys at the rate payable the documents pursuant to which the liability to pay interest arises ...".

1. The respondent sought further and better particulars of the statement of claim. That request included the following:

"1AS to the final sentence of Paragraph 3 and the Guarantee referred to therein, state:

...

(c)what

(i)        advances

(ii)       cash credit accommodation

(iii)      other finance facilities

(iv)      leasing facilities

(v)       hire purchase facilities

(vi)      bailment facilities

(vii)     dealer facilities

(viii)     other facilities

were ever granted or made by the Plaintiff to M Maloney Pty Ltd, and if any, state the date of such granting or making and the terms thereof."

The applicant did not comply with that request, and on 1 March 1991 the respondent filed an application seeking an order inter alia that the applicant deliver particulars to the respondent in the terms of the request within fourteen days. The application was duly served. It came before the Master on 26 March 1991. The applicant did not appear before the Master I was told that that was because the applicant's solicitor had determined that he did not wish to oppose the making of the order sought. Accordingly, the Master made an order in terms of the application. The applicant now seeks an extension of time in which to appeal against that portion of the order of the Master which required the applicant to deliver to the respondent further and better particulars in the terms of par1(c) of the request for further and better particulars. The applicant has delivered some particulars in purported compliance with that part of the order, but has refused to provide any further particulars upon grounds expressed by it, in the final set of particulars delivered, in the following terms:

"(i)the particulars sought are not material facts to this action;

(ii)the particulars sought are irrelevant; and

(iii)the request (sic) is oppressive having regard to the fact that the commercial relationship of the Plaintiff and M Maloney Pty Ltd commenced in approximately March 1975 and in the intervening period numerous transactions of the type requested after were entered into between the Plaintiff and M Maloney Pty Ltd."

1. I should say at once that I reject the submission made by counsel for the applicant that when an order for further and better particulars is made, it is open to the party ordered to deliver them to take objection in the same way as objection may be taken to answering interrogatories. That submission is not tenable. Once an order has been made, it requires the party to whom it is directed to comply with the order

1. During the course of argument on the present application, two principal matters were the subject of debate:

1Whether, even in the absence of opposition to the order made by the Master, it ought to have been made by him in the proper exercise of his discretion applying the relevant principles.

2The extent of the delay in making the present application and the explanations given therefor

1. On the issue of whether the order should have been made at all, counsel for the respondent put his argument this way. The statement of claim alleges a guarantee of the company's obligations, the consideration for which is expressed to be as set out in the form of written guarantee. By the statement of claim the applicant expresses an intention of relying on the full terms and provisions of the guarantee at trial. The form of guarantee is expressed to have been given for certain consideration so that the respondent is entitled to particulars of such consideration. I consider that argument to be fallacious. To some extent the difficulties arise because of the unhappy way in which the guarantee is expressed and because of defects in the statement of claim. In my view, it is incumbent upon a plaintiff to expressly plead terms of a written contract upon which the plaintiff relies for the purpose of the action rather than to leave it to a defendant to search through a document said to be relied upon, possibly putting the defendant in the position of having to plead to matters contained in such document which are not expressly pleaded in the statement of claim.

1. The form of guarantee not being under seal, it is incumbent upon the applicant to establish, as part of proving its cause of action, that there was sufficient consideration for the obligations assumed by the respondent under the guarantee. The provision of such consideration ought to be expressly pleaded. It would be proper to require the applicant to provide particulars of such consideration as is alleged to have been provided for the respondent assuming liability as guarantor, either as to the whole or part of the amount claimed. The applicant might well take the view that regardless of what is expressed in the form of guarantee, a transaction entered into before the guarantee was entered into could not constitute sufficient consideration in that it would constitute past consideration. In those circumstances, it might be thought that there would have been good reason not to order particulars of all transactions whether or not such transactions could constitute good consideration or were relied upon by the applicant as constituting consideration. The Master was in the position where the form of guarantee was not before him at all. On the face of the statement of claim, it was not at all apparent that what was sought could in any way be described as being "further and better particulars of any matter stated in any pleading", in the words of O21, r7(4). It is therefore difficult to understand the basis upon which the Master considered it appropriate to order such particulars. What I have said is sufficient to indicate that it is my view that upon the merits, an appeal against the Master's order has a very substantial chance of success.

1. I turn to the question of delay. Some particulars were supplied subsequent to the making of the order by the Master The respondent was not satisfied with the particulars delivered. It made a further application which came before Wright J on 27 May 1991 when his Honour, in effect, ordered that the Master's order be complied with within fourteen days. The solicitor having the conduct of this matter has deposed that "[u]ntil that day [ie 27 May 1991] it was not realised by the Plaintiff's Solicitors that the form in which the plaintiff had answered request No1(c) could only be contested by way of appeal from the Master". I make two observations about that. I am surprised that the applicant's solicitors did not understand that an order, once made, is required to be obeyed, at least until it is set aside on appeal or otherwise. Notwithstanding the statement that at that time the applicant's solicitors did realise that the order could only be challenged by way of appeal, the final set of particulars, dated 12 June 1991, maintained a refusal to provide any further particulars, setting forth the grounds to which I have earlier referred. I accept that from late May until early June the applicant's solicitor attempted to negotiate with the respondent's solicitor with a view to reaching some agreement to limit the ambit of the particulars required. The present application was filed on 17 June 1991. The time limited for appealing against an order of the Master is four days. In fact, almost three months expired from the date of the Master's order until the filing of the present application. The matter came before me on 29 July 1991, but the hearing was not able to proceed to completion on that day because no affidavit in support of the application had been filed, and objection was taken to certain statements of fact being made from the Bar table. An affidavit was sworn and filed on 1 August 1991. The applicant's solicitors have undoubtedly been extremely dilatory, and their appreciation of the issues, at least until the matter came before Wright J, might be said to fall far short of what one would expect of a solicitor of ordinary competence. In many cases, those matters might be sufficient to lead to the conclusion that a favourable exercise of the discretion ought not to be exercised.

1. Nevertheless, I have concluded that in the present case, time ought to be extended. I take into account the observations which I have made as to the appropriateness of the Master's order No prejudice is alleged by the respondent. I also take into account that on one view, which is a view that might well ultimately be taken by the judge dealing with the appeal against the Master, to require the applicant to deliver all the particulars sought would be an exercise in futility in that many of those particulars, by their very nature, could not possibly have anything to do with this case or affect its outcome. One cannot but suspect that the respondent may have some irrelevant motive for insisting that the Master's order be complied with in its entirety in that it may be that if the applicant finds it impossible to comply with the order it will be frustrated in proceeding with this action at all. If that is the respondent's real motive, then it ought not to be countenanced. On an appeal it will be possible to properly explore the real matters in issue between the parties, and to order particulars of those matters which are material to a determination of the action.

1. Accordingly, I will order that the time limited by O62, r3 for appealing against so much against the order of the Master made 26 March 1991 whereby the Master ordered that the applicant deliver further and better particulars to the respondent in the terms of par1(c) of a request dated 8 November 1990 be extended. I will hear counsel as to the period of the extension.