FAI General Insurance Co Ltd v McSweeney, Brian Albert and Ors Travel Compensation Fund v FAI General Insurance Co Ltd

[1998] FCA 1142

FEDERAL COURT OF AUSTRALIA

COSTS – unsuccessful applicant successful on one issue in the proceeding – whether applicant should be awarded costs of that issue – issue occupying a substantial proportion of the hearing – whether matter in issue needed to be established for applicant to succeed – whether it was unreasonable for respondent not to concede issue.

COSTS – whether applicant should be ordered to pay out of pocket expenses, including loss of earnings, of successful respondents where respondents legally represented – power of court to make order sought.

JUDGMENTS AND ORDERS – application for leave to make further submissions between publication of reasons and making of orders – whether applicant was afforded an adequate opportunity to make submissions on the hearing – whether decision proceeded on a fundamental misapprehension of fact or law.

Law Reform (Miscellanous Provisions) Act (NSW) 1946 s 6 (4)
Federal Court of Australia Act (Cth) 1976 s 43
Federal Court Rules O 62

Cummings v Lewis (1993) 41 FCR 559, distinguished
Hughes v Western Australian Cricket Association Inc (1986) ATPR ¶40-748, considered
Australian Conservation Foundation v Forestry Commission (1988) 81 ALR 166, considered
Secretary, Department of Foreign Affairs and Trade v Boswell [No 2] (1992) 39 FCR 288, not followed
Kerridge v Foley, unreported, SC(NSW)/Street J, 19 August 1970, not followed
Cachia v Isaacs [No 2], unreported, CA(NSW), 23 March 1989, referred to
CachiavHanes (1994) 179 CLR 403, applied
Morton v Official Receiver for the Bankruptcy Division of the State of Victoria (1996) 68 FCR 360, followed
Autodesk IncvDyason [No 2] (1993) 176 CLR 300, applied

FAI GENERAL INSURANCE CO LIMITED v BRIAN ALBERT McSWEENEY & ORS
NG 312 of 1992

TRAVEL COMPENSATION FUND v FAI GENERAL INSURANCE CO LIMITED
NG 948 of 1992

LINDGREN J
SYDNEY
15 SEPTEMBER 1998

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

 NG 312 of 1992

BETWEEN:

FAI GENERAL INSURANCE CO LIMITED
APPLICANT

AND:

BRIAN ALBERT McSWEENEY
FIRST RESPONDENT

BRUCE WILLIAM PHILLIPS
SECOND RESPONDENT

JOHN WILLIAM BEALE
THIRD RESPONDENT

PAUL FREDERICK TURNER
FOURTH RESPONDENT

TIMOTHY PATRICK CULLEN
FIFTH RESPONDENT

MICHAEL JOHN GAERTNER
SIXTH RESPONDENT

TAG PACIFIC LIMITED
SEVENTH RESPONDENT

TOIKAN HOLDINGS PTY LIMITED
EIGHTH RESPONDENT

BETWEEN:

TAG PACIFIC LIMITED AND TOIKAN HOLDINGS PTY LIMITED
FIRST CROSS-CLAIMANTS

AND:

FAI GENERAL INSURANCE CO LIMITED
FIRST CROSS-RESPONDENT

BETWEEN:

BRIAN ALBERT McSWEENEY AND BRUCE WILLIAM PHILLIPS
SECOND CROSS-CLAIMANTS

AND:

FAI GENERAL INSURANCE CO LIMITED
SECOND CROSS-RESPONDENT

JUDGE:

LINDGREN J

DATE OF ORDER:

15 SEPTEMBER 1998

WHERE MADE:

SYDNEY

THE COURT DECLARES THAT:

1. The applicant/second cross-respondent was not entitled to avoid professional indemnity policy number 2005185140 being the policy which related to the period 23 May 1989 to 23 May 1990 (“the Policy”) and that the Policy is enforceable in accordance with its terms.

THE COURT ORDERS THAT:

1. The application be dismissed.

1. The applicant/second cross-respondent pay the costs of the respondents and of the second cross-claimants, except the costs of the hearings on 18, 22 and 26 May 1998 and written submissions associated with those hearings.

1. The costs referred to in order 2 be taxed and paid forthwith pursuant to O 62 r 3 (2) of the Federal Court Rules.

THE COURT NOTES THAT:

1. There is no order as to the costs of the hearings on 18, 22 and 26 May 1998 and written submissions associated with those hearings, to the intent that the parties bear their own respective costs of those matters.

THE COURT DIRECTS THAT:

1. There be a further hearing on these questions:

   “(a)     Whether FAI is liable to pay any, and if so what, amount to the first or second respondent referable to legal costs incurred by them in conducting the defence of the TAG proceeding and any appeal therein;

   (b)      Whether the first or second respondent is entitled to any, and if so what, damages as a result of FAI’s wrongful avoidance of the Policy.”

1. The proceeding be listed on 18 September 1998 at 9.30 am for further directions.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 948 of 1992

BETWEEN:	TRAVEL COMPENSATION FUND APPLICANT
AND:	FAI GENERAL INSURANCE CO LIMITED RESPONDENT
BETWEEN:	FAI GENERAL INSURANCE CO LIMITED FIRST CROSS-CLAIMANT
AND:	BRIAN ALBERT McSWEENEY, PAUL FREDERICK TURNER, BRUCE WILLIAM PHILLIPS AND TIMOTHY PATRICK CULLEN FIRST CROSS-RESPONDENTS
BETWEEN:	BRIAN ALBERT McSWEENEY, PAUL FREDERICK TURNER, BRUCE WILLIAM PHILLIPS AND TIMOTHY PATRICK CULLEN SECOND CROSS-CLAIMANTS
AND:	FAI GENERAL INSURANCE CO LIMITED SECOND CROSS-RESPONDENT
JUDGE:		LINDGREN J
DATE OF ORDER:		15 SEPTEMBER 1998
WHERE MADE:		SYDNEY

THE COURT DECLARES THAT:

1. The second cross-respondent was not entitled to avoid professional indemnity policy number 2030243080 being the policy which related to the period 23 May 1991 to 23 May 1992 (“the Chatswood Policy”) and that the Chatswood Policy is enforceable in accordance with its terms.

1. The second cross-respondent was not entitled to avoid professional indemnity policy number 2030243160 being the policy which related to the period 23 May 1991 to 23 May 1992 (“the Gosford Policy”) and that the Gosford Policy is enforceable in accordance with its terms.

1. The second cross-respondent is liable pursuant to the Chatswood and Gosford Policies, respectively, to indemnify the first named and third named second cross-claimants in respect of proceeding NG 777 of 1991 brought by the present applicant in this Court (“the TCF proceeding”) including the whole of the judgment in the TCF proceeding and any costs orders and interest on the judgment and/or any costs orders relating to the TCF proceeding, subject to the respective policy limits and excesses.

1. The second cross-respondent is liable to pay to the first named and third named second cross-claimants their reasonable legal costs and expenses (if any) reasonably incurred by them in defending the TCF proceeding.

THE COURT ORDERS THAT:

1. The first cross-claim be dismissed.

1. The first cross-claimant pay the costs of the first cross-respondents of the first cross-claim.

1. The second cross-respondent pay the second cross-claimants’ costs of the second cross-claim.

1. The legal costs referred to in declaration 4 above be assessed.

1. The costs which the first cross-claimant/second cross-respondent is ordered to pay in orders 2 and 3 above be taxed and paid forthwith pursuant to O 62 r 3 (2) of the Federal Court Rules.

1. The application for leave pursuant to sub-section 6 (4) of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) to proceed against the respondent be dismissed.

1. The applicant pay the respondent’s costs of the application for leave, that is, the respondent’s costs of the proceeding to the extent only that they would not have been incurred but for the applicant’s participation in the proceeding.

1. The applicant’s motion brought by amended notice of motion filed on 12 May 1998 be dismissed.

2. The applicant pay the respondent’s costs of that motion.

THE COURT NOTES THAT:

1. Without prejudice to the above orders, there is no order as to the costs of the cross-claimants and the cross-respondents of the hearings on 18, 22 and 26 May 1998 and written submissions associated with those hearings, to the intent that they bear their own respective costs of those matters.

THE COURT DIRECTS THAT:

1. There be a further hearing on the question of whether the second cross-claimants are entitled to any, and if so what, damages as a result of the second cross-respondent’s wrongful avoidance of the Chatswood Policy and the Gosford Policy.

1. The proceeding be listed on 18 September 1998 at 9:30 am for further directions.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 312 of 1992

BETWEEN:

FAI GENERAL INSURANCE CO LIMITED
APPLICANT

AND:

BRIAN ALBERT McSWEENEY
FIRST RESPONDENT

BRUCE WILLIAM PHILLIPS
SECOND RESPONDENT

JOHN WILLIAM BEALE
THIRD RESPONDENT

PAUL FREDERICK TURNER
FOURTH RESPONDENT

TIMOTHY PATRICK CULLEN
FIFTH RESPONDENT

MICHAEL JOHN GAERTNER
SIXTH RESPONDENT

TAG PACIFIC LIMITED
SEVENTH RESPONDENT

TOIKAN HOLDINGS PTY LIMITED
EIGHTH RESPONDENT

BETWEEN:

TAG PACIFIC LIMITED AND TOIKAN HOLDINGS PTY  LIMITED
FIRST CROSS-CLAIMANTS

AND:

FAI GENERAL INSURANCE CO LIMITED
FIRST CROSS-RESPONDENT

BETWEEN:

BRIAN ALBERT McSWEENEY AND BRUCE WILLIAM PHILLIPS
SECOND CROSS-CLAIMANTS

AND:

FAI GENERAL INSURANCE CO LIMITED
SECOND CROSS-RESPONDENT

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 948 of 1992

BETWEEN:	TRAVEL COMPENSATION FUND APPLICANT
AND:	FAI GENERAL INSURANCE CO LIMITED RESPONDENT
BETWEEN:	FAI GENERAL INSURANCE CO LIMITED FIRST CROSS-CLAIMANT
AND:	BRIAN ALBERT McSWEENEY, PAUL FREDERICK TURNER, BRUCE WILLIAM PHILLIPS AND TIMOTHY PATRICK CULLEN FIRST CROSS-RESPONDENTS
BETWEEN:	BRIAN ALBERT McSWEENEY, PAUL FREDERICK TURNER, BRUCE WILLIAM PHILLIPS AND TIMOTHY PATRICK CULLEN SECOND CROSS-CLAIMANTS
AND:	FAI GENERAL INSURANCE CO LIMITED SECOND CROSS-RESPONDENT
JUDGE:		LINDGREN J
DATE:		15 SEPTEMBER 1998
PLACE:		SYDNEY

REASONS FOR JUDGMENT

(Motion, costs and other matters)

I published reasons in four parts on 12 March 1997 (Part I), 9 April 1998 (Parts II and III) and 24 April 1998 (Part IV).  On the latter date I ordered that both proceedings be stood over to a date for the making of orders.  Perhaps it should not have been surprising, in view of the complexity of the issues, that the question of the appropriate orders to be made should itself have given rise to much debate.  Pursuant to directions there have been hearings of oral submissions on three occasions and exchanges of extensive written submissions. 

The parties are in agreement as to some of the orders to be made and not as to others.  It is convenient to identify the orders as to which there is agreement and the outstanding issues.  I will use the abbreviations which I used in Parts I, II, III and IV of the Reasons for Judgment and I will take those Reasons as read. 

THE TAG INSURANCE PROCEEDING (NG 312 of 1992)

Agreed orders in the TAG insurance proceeding (NG 312 of 1992)

1. A declaration that the second cross-respondent was not entitled to avoid professional indemnity policy number 2005185140 being the policy which related to the period 23 May 1989 to 23 May 1990 (“the Policy”) and that the Policy is enforceable in accordance with its terms.

1. An order that the application be dismissed.

Outstanding issues in the TAG Insurance proceeding (NG 312 of 1992)

(A)       Whether, as PMS submit, the following declaration should be made:

“A declaration that the applicant (FAI) is not entitled to repayment of any money paid out under the Policy or any interest thereon, including:

(a)the costs of $439,145.67 paid out in defending proceeding number NG 38 of 1990 (“the TAG proceeding”);

(b)the settlement payment of $245,000 to Industrial Performance Group Ltd in relation to proceeding number NG 546 of 1989 plus costs of $55,538.68 in defending the said proceeding.”

(B)Whether there should be an order that the applicant (FAI) pay the respondents’ costs of the application, or whether, as FAI submits, there should be excepted from the order those costs referable to the issue of whether the facts giving rise to the TAG proceeding involved dishonesty on the part of McS.

(C)Whether, as PMS submits, there should be a declaration that FAI is liable to indemnify the respondents in relation to all legal costs (on a solicitor and client basis) incurred by them in defending the TAG proceeding, including the appeal in relation to that proceeding, in accordance with the terms of the policy. PMS accepts that it should be noted that, without admissions, it accepts that the “averaging provision” should apply.

(D)      Whether there should be, as FAI submits, a further hearing on these questions:

“(a)Whether FAI is liable to pay any, and if so what, amount to the first or second respondent referable to legal costs incurred by them in conducting the defence of the TAG proceeding and any appeal therein;

(b)Whether the first or second respondent is entitled to any, and if so what, damages as a result of FAI’s wrongful avoidance of the Policy.”

(E)Whether there should be, as PMS submit, an order that the fourth and fifth respondents (Turner and Cullen) be added as additional second cross-claimants.

(F)Whether, as PMS submit, there should be a declaration that the second cross-respondent (FAI) wrongfully repudiated the Policy by refusing to indemnify the respondents, and is liable to compensate the second cross-claimants for any damage suffered by them arising from the repudiation.

FAI submits that no such declaration should be made.

(G)Whether, as PMS submit, there should be an order that the second cross-respondent (FAI) pay the costs of the second cross-claimants of the second cross-claim to date and an order pursuant to O 62 r 3 (2) of the Federal Court Rules, that such costs be taxed and paid forthwith, or whether, as FAI submits, there should be excepted from the order, those costs referable to the issue of whether the facts giving rise to the TAG proceeding involved dishonesty on the part McS, and there should not be an order that the costs be taxed and paid forthwith.

(H)Whether, as PMS submit and FAI disputes, there should be an order that the applicant/second cross-respondent pay the respondents’/second cross-claimants’ out of pocket expenses incurred in relation to the application and second cross-claim to date, such costs to be taxed and paid forthwith, such expenses to include earnings (if any) lost as a result of the need to prepare the case and attend court.

1. Whether, as PMS submit and FAI disputes, there should be an order that the damages referred to in Outstanding Issue (F) above be assessed.

(J)Whether, as FAI submits and PMS dispute, there should be an order that the respondents/second cross-claimants pay FAI’s costs referable to the issue whether the facts giving rise to the TAG proceeding involved dishonesty on the part of McS.

THE TCF INSURANCE PROCEEDING (NG 948 of 1992)

Agreed orders in the TCF insurance proceeding (NG 948 of 1992)

1. An order that the first cross-claim be dismissed.

1. An order that the first cross-claimant pay the costs of the first cross-respondents of the first cross-claim.

1. A declaration that the second cross-respondent was not entitled to avoid professional indemnity policy number 2030243080 being the policy which related to the period 23 May 1991 to 23 May 1992 (“the Chatswood Policy”) and that the Chatswood Policy is enforceable in accordance with its terms.

1. A declaration that the second cross-respondent was not entitled to avoid professional indemnity policy number 2030243160 being the policy which related to the period 23 May 1991 to 23 May 1992 (“the Gosford Policy”) and that the Gosford Policy is enforceable in accordance with its terms.

1. A declaration that the second cross-respondent is liable pursuant to the Chatswood and Gosford Policies, respectively, to indemnify the first named and third named second cross-claimants in respect of proceeding NG 777 of 1991 brought by the present applicant in this Court (“the TCF proceeding”) including the whole of the judgment in the TCF proceeding and any costs orders and interest on the judgment and/or any costs orders relating to the TCF proceeding, subject to the respective policy limits and excesses.

1. A declaration that the second cross-respondent is liable to pay to the first named and third named second cross-claimants their reasonable legal costs and expenses (if any) reasonably incurred by them in defending the TCF proceeding.

1. An order that the second cross-respondent pay the second cross-claimants’ costs of the second cross-claim.

1. An order that the legal costs referred to in Agreed Order 6 above be assessed.

Outstanding issues in the TCF insurance proceeding (NG 948 of 1992)

(A)Whether TCF should be granted leave to make further submissions in relation to that part of Part I of my Reasons for Judgment which constituted my reasons for refusing TCF leave to commence the TCF insurance proceeding pursuant to s 6 (4) of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW).

(B)If so, whether leave to commence the TCF insurance proceeding should be granted to TCF.

(C)Whether there should be a declaration that there is a charge for the benefit of TCF on all insurance monies payable by FAI in respect of the liability the subject of the judgment in favour of TCF and against McS and Phillips in the TCF proceeding.

(D)Whether there should be an order that FAI pay to TCF $671,888, being damages of $626,586 and costs of $115,302 awarded by Wilcox J against McS and Phillips in the TCF proceeding, less the amount of $70,000 received by TCF, together with interest on $671,888 pursuant to s 51A of the Federal Court of Australia Act 1976 (Cth) at the rate of 10.5% pa from 2 December 1992 until payment.

(E)According to the answers to (A) to (D), what order as to costs should be made as between TCF and FAI in relation to the TCF insurance proceeding and TCF’s present motion in that proceeding.

(F)Whether there should be, as PMS contend,

“A declaration that FAI wrongfully repudiated the Chatswood Policy and the Gosford Policy and is liable to compensate the second cross-claimants (McS and three others) for any damages suffered by them arising from the repudiation”,

or, as FAI contends,

“A direction that there be a further hearing on the question of whether the second cross-claimants are entitled to any, and if so what, damages as a result of FAI’s wrongful avoidance of the Chatswood Policy and the Gosford Policy.”

(G)Whether the costs which the second cross-respondent (FAI) is ordered to pay to the first named and third named second cross-claimants (McS and Phillips) in Agreed Order 7 above, should be ordered to be taxed and paid forthwith pursuant to O 62 r 3 (2) of the Federal Court Rules.

(H)Whether, as PMS submit and FAI disputes, there should be an order that the cross-claimant/second cross-respondent (FAI) pay the cross-respondents’/second cross-claimants’ (PMS’s) out of pocket expenses incurred in relation to the cross-claim and second cross-claim to date, such costs to be taxed and paid forthwith, such expenses to include earnings (if any) actually lost as a result of the need to prepare the case and attend court.

1. Whether, as PMS contend, there should be an order that the damages referred to in Outstanding Issue (F) above be assessed.

REASONING

NG 312 of 1992

Issue (A)

PMS submits that the declaration sought by them (of non-entitlement to repayment) “reflects the primary issues between the parties” and “disposes of the orders sought by FAI”. They submit that the declaration proposed is simply the converse of the relief sought by FAI.

FAI, on the other hand, submits that the dismissal of its application (Agreed Order 2) adequately disposes of its application for relief and that the declaration sought by PMS is unnecessary and inappropriate.  FAI points out that the declaration proposed by PMS was not sought in the second cross-claim, unlike the additional declaration that has been agreed (Agreed Order 1). At one stage FAI also submitted that the further declaration sought by PMS should not be made because it (FAI) in fact claimed an entitlement to be repaid some, although not all, of the monies paid by it pursuant to the Policy.  However, FAI has not pressed this claim for repayment.

In my view, the further declaration sought by PMS should not be made.  The fact that an applicant does not obtain the relief it seeks does not of itself entitle the respondent to a declaration that that relief was or is not available.  Moreover, ordinarily, unless a respondent cross claims for a declaration, one should not be made.  I see no reason to treat the present case as extraordinary in the present respect.  Finally, the consequences that the agreed declaration that the Policy is “enforceable in accordance with its terms” should have, are more appropriately left to be worked out in the light of the consequential claims to be made as part of  the further hearing yet to take place (see below). 

Issues (B), (G) and (J)
The question involved in all three of these issues is whether PMS should be awarded all of its costs of the proceeding to date or whether there should be excepted the costs referable to the question whether the facts giving rise to the TAG proceeding involved dishonesty on the part of McS, and whether an order should be made that PMS pay FAI’s costs referable to that question.  Issue (G) also raises the question whether the costs of McSweeney and Phillips, as second cross-claimants, should be taxed forthwith.

PMS rely on the ordinary practice according to which costs follow the event. They submit that there is nothing to justify a departure from that practice.  They submit  that the issue whether the TAG facts involved dishonesty on the part of McS was not a separate issue but was an aspect of the issue whether FAI was entitled to avoid the Policy for fraudulent misrepresentation or non-disclosure, on which FAI failed.  Although FAI had earlier pleaded that McS’s dishonest conduct triggered the dishonesty extension in the Policy and that Phillips condoned that dishonest conduct, this allegation was not pressed in FAI’s Third Further Amended Statement of Claim.

FAI, on the other hand, submits that the issue of McS’s dishonesty occupied “a very substantial part of the case”, that FAI succeeded on it, and that it should be awarded its costs referable to it.  FAI relies on Cummings v Lewis (1993) 41 FCR 559, in which a Full Court of this Court upheld the trial judge’s decision that, although the respondent was ultimately successful, it should be ordered to pay the applicant’s costs referable to an issue on which it lost and which it was unreasonable for it to contest. FAI submits that, faced with the findings of fact of Olney J in the TAG proceeding, PMS should have accepted that McS’s conduct involved dishonesty in the underlying facts, and been content to argue that there was no fraudulent misrepresentation or non-disclosure subsequently, entitling FAI to avoid the Policy.

It is well established that

“A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other party’s costs of them. In this sense, ‘issue’ does not mean a precise issue in the technical pleading sense but any disputed question of fact or of law”: Hughes v Western Australian Cricket Association Inc (1986) ATPR ¶40-748 at 48,136, quoted with approval in Cummings v Lewis at 603.

However, the fact that a successful party has failed on a disputed question of fact or law will not, of itself, entitle the other party to its costs on that issue. Rather, what must be shown is that it was unreasonable for the successful party not to have conceded on the issue, and that its failure to do so unreasonably prolonged the proceeding: Cummings v Lewis at 603; see also Australian Conservation Foundation v Forestry Commission (1988) 81 ALR 166 (FCA/Burchett J) at 169. In Cummings v Lewis, the applicant pleaded that certain representations as to future matters were misleading and deceptive. The respondents denied that the representations were made at all, but claimed that if they were made, they had reasonable grounds for making them and were therefore entitled to the benefit of s 41 of the Fair Trading Act 1987 (NSW). The trial judge found that the representations were made but that the respondents did have a reasonable basis for making them. However, in his Honour’s view, it was unreasonable for the respondents not to have conceded that the representations were made, and if that concession had been made, the hearing time would have been reduced by about one third. On this basis he ordered the respondents to pay a percentage of the applicant’s costs. That order was not disturbed on appeal.

Cummings v Lewis is distinguishable from the present case.  First, although it is true that PMS disputed many of Olney J’s findings of fact, including the finding that “at least since 28 July 1987 PMS were engaged in a concerted course of conduct to disguise the truth to ensure that the transaction did not founder”, FAI did not, by reference to the final form of its pleading, need to establish dishonesty on the part of McS in the underlying facts, in order to make good its entitlement to avoid the Policy. It needed simply to establish that the facts giving rise to the TAG proceeding satisfied the description of  “circumstances that [might] give rise to a claim” against its insured.  No doubt, proof of fraud or dishonesty in the underlying facts may, at least arguably, have assisted towards a conclusion that a non-disclosure or misrepresentation in relation to those same facts on the later occasion of the application for the Policy was fraudulent, but that is another matter.

Second, although I found that McS was guilty of fraud and dishonesty in the underlying TAG facts, it was not unreasonable for PMS to put the findings of Olney J in issue so that the precise nature of McS’s “disguising of the truth” could be explored.   Depending on the nature of that conduct, it would be more or less likely that the later non-disclosure or misrepresentation would itself have been fraudulent or dishonest.   If PMS had simply made an unqualified admission of Olney J’s findings, I might have been readily disposed to find fraud and dishonesty when McS, on behalf of PMS, later applied for the issue of the Policy.  

Third, a large amount of time was taken up in seeking to establish the extent to which the figures provided by McS to TAG misrepresented the true state of the Toikan companies’ finances.  FAI originally claimed that the shortfall was a little over $2,000,000.  However, its expert eventually agreed that the shortfall was of the order of $80,000.  That the shortfall was so “small” was relevant to the issue of McS’s state of mind, not only at the time of the making of the Representations, but, more importantly, at the latter time of the application for the issue of the Policy.  

For the reasons given above, I do not think that there should be any departure from the usual order in relation to costs.

Issues (C), (D), (F) and (I) 
PMS submit that there should be declarations that FAI is liable to indemnify them in respect of legal costs incurred in defending the TAG proceeding (Issue (C)) and that FAI repudiated the Policy and is liable to compensate McS and Phillips for any loss suffered as a result of the repudiation (Issue (F)), and also that there should be a direction that the legal costs and damages be assessed (Issue (I)). FAI, on the other hand, submits that there should be no declarations at this stage, but that there should simply be a direction that there be a further hearing on the questions of legal costs and damages (Issue (D)).

In my opinion, it is not appropriate to make the declarations and direction sought by PMS.  To do so would be to pre-empt issues to be determined in the quantification hearing yet to occur.  The consequences of FAI’s liability to indemnify PMS under the Policy in accordance with its terms have not been explored in the hearing to date.

In relation to compensation of McS and Phillips for wrongful repudiation, it should be noted that McS and Phillips did cross-claim for declaratory relief against FAI.  FAI clearly breached the contractual terms of the Policy (on my findings), and, it seems, wrongfully repudiated the Policy in the sense that it manifested an intention not to be bound in accordance with those terms.  However, there is a problem with a declaration that PMS is entitled to compensation for repudiation.  The problem is that the repudiation has not been, and apparently never will be, accepted by PMS.  What PMS truly seek is a remedy in respect of breach of a subsisting contractual promise.

In the circumstances, therefore, it is more appropriate to make the direction sought by FAI, rather than the declarations and direction sought by PMS.

Issue (E)
At one stage, McS and Phillips sought to join the other four respondents as additional second cross-claimants with themselves.  They later did not press that application in so far as it related to Beale and Gaertner, as senior counsel for McS and Phillips conceded that he did not appear for them. Indeed, Beale and Gaertner filed submitting appearances, so it appears that there is no basis on which they could be joined as additional second cross-claimants.

In relation to Turner and Cullen, FAI submits that if they wished to be cross-claimants they should have joined in the second cross-claim when it was filed or soon afterwards.  FAI points out that, were it not for an indulgence granted to PMS, the issue of any damages for breach of the Policy would already have been dealt with, and that when the indulgence was granted, it was made clear that the deferral of the hearing was not to be used as a basis for widening the claim.

The only point that PMS seem to raise is that it was always clear that the damages claimed “were essentially those of Mr McSweeney and Mr Turner in partnership”. This does not support the addition of Turner and Cullen at this late stage.  It is not suggested that Turner and Cullen suffered any loss and damage.  If they did, no doubt they would have been joined as further second cross-claimants at the outset.

I am not persuaded that Turner and Cullen should be added as additional second cross-claimants.

Issue (G)
In relation to the question whether there should be an order that the costs of the second cross-claimants (McS and Phillips) to date should be taxed and paid forthwith, two matters seem to call for comment.  The first is that such an order is not sought in relation to the costs of the respondents to the application itself.  The second is that FAI originally foreshadowed that its opposition was on the basis that it may still wish to recover some of the monies paid out by it, and that it would therefore be premature to make an order for taxation and payment forthwith.   However, once it became clear that FAI was not going to press such a claim, counsel for FAI did not make any submissions on the present issue.

Sizeable amounts must have been expended in costs and those expenditures were made a long time ago.  I do not know how much more time will be occupied in the quantification issues.  Those issues are distinct in nature from the liability issues which I have determined.  I think it appropriate to make the order sought by PMS.

Issue (H)
In seeking the order that FAI pay the out of pocket expenses and loss of earnings of McS and Phillips, PMS rely on the decision of a Full Court of this Court in Secretary, Department of Foreign Affairs and Trade v Boswell [No 2] (1992) 39 FCR 288 (“Boswell”) . In Boswell, the respondent successfully represented herself on an appeal.  The Full Court held that she should recover  her out of pocket expenses necessarily and reasonably incurred in relation to the appeal, including earnings (if any) actually lost as a result of the need to prepare her case and to attend court to present it.  In the present case, PMS did not need to attend court to present their case.  However, it is possible that they lost income as a result of the time spent preparing for the case and attending court as witnesses and to instruct their legal representatives.

One obvious distinction between this case and Boswell is that McS and Phillips did not represent themselves. However, the Full Court in Boswell drew upon the unreported decision of Street J in Kerridge v Foley, 19 August 1970, for this proposition:

“a party, whether represented or not, who has a real need to be present in court throughout the hearing, is entitled to recover at least the out of pocket expenses (including loss of earnings) incurred as a consequence of that attendance.” (emphasis supplied – at 294-5)

The relevant principles were discussed by the New South Wales Court of Appeal in Cachia v Isaacs [No 2], unreported, 23 March 1989, in which it was held by majority (Samuels and Clarke JJA; Kirby P dissenting) that a litigant in person was not entitled to recover loss of earnings for time spent in preparation and attendance at court.  The majority accepted, however, that the notion of “witnesses’ expenses” might, depending upon the circumstances, embrace some time spent attending court beyond the time barely necessary for the giving of evidence.

The decisions mentioned must now be understood in the light of the decision of the High Court in CachiavHanes (1994) 179 CLR 403, another litigant-in-person case (the appeal was from a decision of the New South Wales Court of Appeal in the case so intituled, reported at (1991) 23 NSWLR 304).

In CachiavHanes, the High Court held by majority (Mason CJ, Brennan, Deane, Dawson and McHugh JJ;  Toohey and Gaudron JJ dissenting), that a litigant in person was not entitled to be recompensed for time spent in preparing and conducting his case as “costs”.  The majority also referred to:

“the approach adopted in some cases where courts have treated the loss in earnings of a litigant incurred in the course of the presentation or conduct of his case as a disbursement [they referred to inter alia, Boswell and Kerridge v Foley]”

and said,

“Clearly, that is merely an indirect way of recompensing a litigant for time spent in the preparation or conduct of his case which, if it is not contemplated by the relevant legislation or rules, is not permissible.” (at 417)

PMS submitted that the High Court was not here disapproving of the Full Court’s decision in Boswell.  However, it is hard to see how the High Court could have been plainer in its disapproval of both Kerridge v Foley and Boswell, in the respect being considered.  In Morton v Official Receiver for the Bankruptcy Division of the State of Victoria (1996) 68 FCR 360 (“Morton”) Olney J applied Cachia v Hanes and did not follow Boswell, in holding that this Court’s power to order “costs” under s 32 of the Bankruptcy Act 1996 did not extend to permit an order for recovery of compensation for time spent in preparation for the case by the applicant personally (in Morton the applicant was a registered trustee under the Bankruptcy Act 1966 who had been legally represented on the hearing).

The order sought by PMS should not be made.  The legislative sources of this Court’s power to make orders for costs were referred to in Boswell. They are s 43 of the Federal Court of Australia Act 1976 and O 62 of the Federal Court Rules.  The particular provisions were identified in Boswell and I will not refer to them again.

Cachia v Hanes shows that the Court’s power under s 43 and O 62 does not extend to the making of the order sought by PMS. It will be a matter for the taxing officer to apply the relevant Items in the Second Schedule to the Federal Court Rules relating to “witnesses’ expenses” (see generally the discussion in Lynch, “Cachia v Hanes:  The Resurgence of the Indemnity Principle in Australia” (1995) 13 (2) Aust Bar Rev 177, esp at 204).

NG 948 of 1992

Issues (A) – (E)

In Part I of the Reasons for Judgment (now reported at (1997) 73 FCR 379), I indicated that on discretionary grounds TCF would be refused leave to commence the TCF insurance proceeding, and that it would be ordered to pay FAI’s costs of its application for leave, that is, FAI’s costs to the extent, if any, that those costs were increased by virtue of TCF’s participation in the proceeding.

The following passage expressed my reasoning on the question of discretion:

“[TCF] obtained judgment against McS and Phillips on 2 December 1992 for $626,586 plus costs. But as early as 22 December 1992, 20 days after obtaining judgment, it commenced the TCF insurance proceeding. It did so solely on the basis that FAI had refused to indemnify McS and Phillips. Apart from that fact, there is a lack of evidence as to why TCF resorted to s 6 of the LRMP Act. There is no evidence, for example, that it first unsuccessfully sought to enforce its judgment or that there was reason to think that an attempt to do so would be unsuccessful. There is no evidence that McS and Phillips had refused to seek relief against FAI or had shown no interest in doing so. There is no evidence that TCF was in a position to lead evidence against FAI which McS and Phillips were unable to lead.

Clearly, if TCF had threatened enforcement action against McS and Phillips they would have asked TCF to stay its hand pending resolution of their own attempt to extract indemnity from FAI. TCF might have agreed to that request, on condition, for example, that McS and Phillips diligently prosecuted their claim for indemnity and kept TCF informed of progress. Alternatively, they might have refused the request. Either way, it is difficult, on the existing evidence, to perceive as reasonable the launching of the TCF insurance proceeding virtually immediately after the TCF judgment was obtained, for no reason other than that FAI was denying indemnity.” (Reasons Part I – (1997) 73 FCR 379 at 418-419)

By “amended notice of motion” filed on 12 May 1998, TCF seeks leave to make further submissions in relation to my refusal of leave under s 6 (4) of the LRMP Act.

FAI submits that TCF’s motion should be dismissed.  It refers to Autodesk IncvDyason [No 2] (1993) 176 CLR 300, a case in which judgment had been pronounced but not entered and in which the unsuccessful party failed in an application for leave to be heard further as to why the judgment should be recalled. The ground advanced, but which did not prevail with the majority in the High Court, was that that party had not been heard on issues which had proved decisive.

In the present case, there has not yet been a formal refusal of leave under s 6 (4) of the LRMP Act, but in Part I gave my reasons for the foreshadowed refusal. I have a discretion to allow further submissions to be made and to make orders different from those previously indicated. On any reckoning, however, in the interests of finality of litigation, a motion of the present kind can succeed only in exceptional cases. But before referring the relevant test, I return to the factual background.

TCF makes submissions along the following lines.  As I deferred ruling on the question of leave until after the conclusion of the hearing, the question of leave became wholly dependent on the outcome of the liability issue, that is, on the issue whether the policy was enforceable according to its terms and FAI was therefore liable to indemnify PMS. In those circumstances, the matters going to discretion are now shown to have been irrelevant. While they may have been relevant if the application for leave had been decided at the outset, once the determination of the question of leave was deferred, leave had to be granted as a matter of course once it was found that TCF had a charge over the insurance monies, that is, once it was found that FAI was liable to indemnify PMS. On the other hand, if it had been found that FAI was not liable to indemnify PMS, leave to commence a proceeding would have had to be refused, but only for the reason that TCF had no charge to enforce.

TCF points to the following exchange at the beginning of the submissions that were made on 20 September 1995 on the issue of leave under s 6 (4) of the LRMP Act:

“HIS HONOUR:        I would, however, just raise perhaps with Mr Campbell the question of leave. In the event that leave should be granted to TCF and, in effect, many if not all of the issues dealt with in the hearing can be seen to relate to the granting of leave as well as to the substantive questions, your point is that TCF was not entitled to commence the proceedings at least in so far as it sought any relief other than leave.

MR CAMPBELL:       That is so.

HIS HONOUR:          Let us assume that I accepted that and let us assume that on the final hearing I were to determine that there is a liability of FAI to McSweeney and Phillips. I take it that what you would say is that that would lead to a granting of leave and nothing more at least at that point in favour of TCF.

MR CAMPBELL:       At that point, yes.

HIS HONOUR:          Now, presumably TCF would then seek to commence proceedings.

MR CAMPBELL:       Yes, and we would not seek to take time wasting procedural points in relation to that. The logical thing to do would be to just tender everything that has happened.”

TCF seizes on the acceptance by senior counsel for FAI of the proposition that a determination on the final hearing that there was a liability of FAI to McS and Phillips “would lead to a granting of leave”.

FAI, on the other hand, submits that it did not accept that leave would be granted automatically if TCF was found to have a charge, and that the passage set out above must be understood in the context of the particular issue to which it was addressed.   FAI submits that that issue was whether TCF could both seek leave and claim substantive relief in the one proceeding.  This issue was related to the decision of the New South Wales Court of Appeal in National Mutual Fire Insurance Co Ltd v Commonwealth [1981] 1 NSWLR 400 that leave must be obtained prior to the commencement of an action to enforce a charge arising pursuant to s 6 (1) of the LRMP Act. FAI submits that senior counsel’s affirmative response to the question whether a determination of “liability of FAI to McSweeney and Phillips … would lead to a granting of leave” was not, and should not have been understood as being an acceptance of the proposition that a finding of liability would necessarily lead to the granting of leave.

I accept FAI’s submission as to the significance of the passage on which TCF relies.   FAI was seeking to emphasise that TCF had not been entitled to commence the proceeding without first obtaining leave.   FAI could not have made its position clearer on the first day of the trial, 5 June 1995: TCF had never obtained leave to commence the proceeding and should “go away” until the issue of FAI’s liability to indemnify PMS was litigated to conclusion between those parties.   Mr Campbell, senior counsel for FAI, said:

“…..we do not want to have it thought that we acquiesce in the procedure that has been adopted here whereby the claim for leave and the substantive proceedings are as it were heard together. Mr Roberts and mr Minehan [counsel for TCF] are going to be sitting around for an awfully long time with very little to do and somebody is going to have to pay for that and we want to make it clear at the outset that we do not think that they ought to be here; that this is a case where there is a perfectly good common law defendant; that they ought to have run their separate proceedings seeking leave without seeking to join in the fight as between FAI and Phillips McSweeney”.  

The opportunity was afforded to TCF not to participate further in the hearing until the issues beween FAI and PMS had been determined, but it declined, knowing that it would be faced, at the end of the day, with strong submissions from FAI against the granting of leave and on costs. 

It was impracticable on 5 June 1995 to halt the progress of the hearing generally in order to hear and determine TCF’s application for leave for the following reasons: (1)  even the Manettas point alone raised a substantial issue calling for extensive argument and consideration; (2) FAI disputed that PMS were “indemnified against liability to pay” the damages the subject of the TCF judgment (cf s 6 (1) of the LRMP Act) and whether PMS were so indemnified would not be resolved until the end of the trial; and (3) the discretionary factors would also take some time to consider. The obvious solution, and the one which I came to adopt, was to treat the entire hearing as between TCF and FAI as a hearing of TCF’s application for leave.

But if all three issues should be resolved in favour of TCF, what would be the result?   It was to this question that the passage set out earlier from the hearing of submissions on 20 September 1995 was addressed.  Inherent in that result would be a finding of liability against FAI and in favour of PMS.  But as between TCF and FAI, there would be nothing more than the granting of leave to TCF to commence a new proceeding for the enforcement of its charge.  Would the new proceeding require a re-hearing of the evidence?   It was in response to this suggestion that Mr Campbell QC for FAI said at the end of the passage set out earlier:

“… we would not seek to take time wasting procedural points in relation to that.  The logical thing to do would be to just tender everything that has happened.”

It is clear beyond question that, as between TCF and FAI, the entire hearing was a hearing of nothing more than TCF’s contested application under s 6 (4) of the LRMP Act to commence a proceeding against FAI to enforce the charge which it was contending, and which I have now found, had been created by s 6 (1) of that Act. The comments made by Wilcox J at a directions hearing on 3 September 1993, to which TCF referred in its submissions on its present motion, were in complete accordance with this understanding of the position. His Honour certainly did not say that the effect of postponing decision of the question of leave until the end of the hearing would be that discretionary considerations would become irrelevant, or that a conclusion that FAI was liable to indemnify PMS would automatically lead to the granting of leave.

After the closure of the evidence, I gave directions for the filing of written submissions and the setting aside of 20 September 1995 and 11 March 1996 for oral elaboration, the former date being allocated for the submissions on TCF’s application for leave under s 6 (4) of the LRMP Act.

FAI points to particular matters which occurred in the course of submissions on 20 September 1995 to show that the discretionary considerations were indeed recognised as being in issue.  FAI’s submissions in reply to TCF’s submissions in chief argued that TCF should not be granted leave on the three grounds already mentioned: (1) the Manettas point;  (2) that FAI was not liable to indemnify PMS so there was no money over which the statutory charge could exist;  and (3) that TCF had shown no reason why leave should be granted.

The third ground involved the discretionary considerations by reason of which I subsequently held that leave should be refused.  FAI’s submissions dealt with those considerations at some length. Counsel for TCF (Mr Roberts) referred to the fact that PMS had had a number of judgments against it,  and the following exchanges occurred (at T1992):

MR ROBERTS:  “So we say that clearly we are in a position where we must commence, it is the only safe course for our client [TCF], is to go under section 6. Even if they [McS and Phillips] were in a position to pay this money we could not very well take it off them because it could be clawed back under the bankruptcy and we would be left with the position of perhaps further litigation.

One thing that concerns me about this is that we have left this matter mainly to inference because we thought it so obvious and we have not put any evidence on. I think the more abundant caution I would seek to reopen our case in chief and seek to read an affidavit of Mr Hartmann.  I have given a copy to my friend this  morning”

MR CAMPBELL:  “That course is opposed.”

MR ROBERTS:     “Well I would seek to do it anyway, your Honour.  Apparently there had never been an issue as far as we are aware in these proceedings until we read the submissions of FAI who seem to have taken every point that is possibly available on every issue and insofar as this point is available, which we say it is not anyway, but for more abundant caution we would seek to have just an extra piece of evidence in relation to the matter.”

A little later he continued:

“……we are concerned that FAI may say, well even if we [FAI] lose the case against the accountants [PMS] we [TCF] still should not get leave and it is to meet that eventuality that I am seeking to – really, because at every single point that has been taken I just want to cover every possible base.” (T1993.1)

Counsel for TCF sought to re-open for the purpose of reading an affidavit of his instructing solicitor, Mr Terence George Hartmann.  That affidavit was sworn 20 September 1995, that is, long after the closing of the evidence and on the day set aside for submissions.  The application was strongly opposed by FAI.  I decided to grant leave to the limited extent only of permitting parts, but not the whole, of the affidavit to be read.  The parts that I permitted to be read, and which became part of the evidence, were as follows:

“1.  I was the solicitor for Travel Compensation Fund in proceedings against Craig Joseph Dunn and others in the Federal Court No. NG777 of 1991.  The Respondents were Brian Albert McSweeney, Bruce Phillips, Craig Joseph Dunn, Terence Smith and Alistair Victor Nicholas Sharp-Paul.

2.  Prior to and at the hearing of that matter Mr McSweeney and Mr Phillips represented themselves…

3.  On 2 December 1992 judgment order was entered against Bruce Phillips in the sum of $626,586 and against Brian Albert McSweeney in the sum of $626,586 together with costs, and against Craig Joseph Dunn and Alistair Victor Nicholas Sharp-Paul.

4.  After judgment was entered Mr Gillis again said to me words to the effect of “I am not acting for them…”

5.  I prepared a bill of costs and by letter dated 10 June 1993 I served on each of Mr Phillips and Mr McSweeney:

(a) Copy of the bill of costs.
(b) Supporting documents.

(c) Copy of the Order made on 2 December 1992 referred to in the previous  paragraph.

No response was received from Mr Phillips or Mr McSweeney.

6.  Following taxation by letter dated 4 November 1993 I served a Certificate of Taxation of Costs in relation to Mr Phillips and Mr McSweeney upon solicitors Gillis Delaney Brown (Mr Michael Gillis) who by that time was again acting for Mr Phillips and Mr McSweeney.

7.  ……………………………………………………………………………………….

8.  Of the remaining Respondents in proceedings No. NG777 of 1991, judgment was entered against Craig Joseph Dunn for the sum of $598,116.  He did not appear at court and both Craig Joseph Dunn and Terence James Smith (who was not served) have disappeared.  Judgment was entered against Alistair Victor Nicholas Sharp-Paul in the sum of $598,116.  Alistair Victor Nicholas Sharp-Paul has entered into a scheme of arrangement with his creditors in consequence of which the Travel Compensation Fund has received approximately $70,000.  Particulars of that receipt have been provided to the solicitors for FAI.”

The fact that TCF sought to read Mr Hartmann’s affidavit in a belated attempt to support an inference of insolvency shows that they knew that there was an issue as to how I should exercise my discretion under s 6 (4) of the LRMP Act. TCF accepted that National Mutual Fire Insurance Co Ltd v Commonwealth of Australia established that TCF was not entitled to succeed in the proceeding on any claim for relief other than the granting of leave.

It would be inappropriate in these Reasons to elaborate on the discretionary grounds set out earlier which I gave for refusing leave.  It will not have been overlooked, however, that those grounds were not limited to lack of proof of incapacity of McS and Phillips to satisfy the TCF judgment.   As at 20 December 1992, when TCF launched the present proceeding, McS and Phillips were already, through solicitors, defending the TAG insurance proceeding which FAI had launched on 12 May 1992, and cross claiming against FAI for indemnity under the Policy by a second cross-claim filed on 17 November 1992.   If TCF had not pre-empted matters on 20 December, McS and Phillips, faced with enforcement action by TCF, may well have sought to enforce their right to indemnity in respect of the TCF judgment against FAI by means of that already existing second cross-claim or otherwise.  TCF’s precipitous action had the effect of rendering of no particular importance or urgency the joinder of issue as between FAI and PMS, which occurred only much later upon the filing of their “reciprocal” cross-claims. TCF’s action, adhered to on the hearing, has not been adequately explained, either in its submissions on the main hearing or in those on the present motion.

In my view, TCF was accorded adequate opportunity to be heard on the issue of discretion, and my decision in that respect did not proceed on a fundamental misapprehension of fact or law, not attributable solely to the neglect or default of TCF.    In Autodesk IncvDyason [No 2] (1993) 176 CLR 300, support can be found for the existence of these two grounds for the entertaining of further submissions. Neither is made out here. TCF’s motion should be dismissed with costs.

Issues (F) and (I)

These issues are similar to Issues (C), (D), (F) and (I) in NG 312 of 1992, discussed above. That is, the question is whether it is appropriate to declare that FAI repudiated the policy and is liable to pay damages, or whether there should simply be a direction that there be a further hearing on the issue whether the second cross-claimants are entitled to any, and if so what, damages as a result of FAI’s wrongful avoidance of the policy. For the reasons given earlier, the latter is the preferable course.

Issue (G)

As was the case with Issue (G) in NG 312 of 1992, FAI’s opposition was originally on the basis that “[i]t is premature to order that costs be paid (as distinct from taxed) until all pecuniary amounts as between PMS and FAI are determined (including any obligation of PMS to pay an amount of the defence costs of the Tag proceedings).  FAI no longer seeks to recover any amount from PMS.  For the reasons given in relation to Issue (G) in NG 312 of 1992,  the order sought by PMS should be made.

Issue (H)
For the reasons given in relation to Issue (H) in NG 312 of 1992, I do not think that the order sought by PMS should be made.

CONCLUSION

The declarations, orders and directions to be made are sufficiently indicated in the above reasons.  On the issues arising as between FAI and PMS, those respective parties have both had a measure of success.   They should be left to bear their own respective costs of the hearings on 18, 22 and 26 May 1998 and associated written submissions.

I certify that this and the preceding twenty two (22) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Lindgren

Associate:

Dated:             15 September 1998

Proceeding No NG 312 of 1992

Counsel for the Applicant (FAI):	Mr PF Liney
Solicitors for the Applicant (FAI):	Colin Biggers and Paisley
Counsel for the First, Second, Fourth and Fifth Respondents (McSweeney, Phillips, Turner and Cullen):	Mr PM Biscoe QC with Mr SW Climpson
Solicitors for the First, Second, Fourth and Fifth Respondents (McSweeney, Phillips, Turner and Cullen):	Gillis Delaney Brown
Solicitor for the Third Respondent (Beale):	Mr DM Vaughan, solicitor, of Heaney, Richardson & Nemes (submitting)
Solicitors for the Sixth Respondent (Gaertner):	Walters Solicitors (submitting)

Proceeding No NG 948 of 1992
Counsel for the Applicant (TCF):	Mr P Roberts with Mr MK Minehan
Solicitors for the Applicant (TCF):	TG Hartmann & Associates
Counsel for the Respondent/First cross-claimant (FAI):	Mr PF Liney
Solicitors for the Respondent/First cross-claimant (FAI):	Colin Biggers & Paisley
Counsel for the First cross-respondents/ Second cross-claimants (McSweeney, Phillips, Turner and Cullen):	Mr PM Biscoe QC with Mr SW Climpson
Solicitors for the First cross-respondents/Second cross-claimants (McSweeney, Phillips, Turner and Cullen):	Gillis Delaney Brown
Date of Hearing:	18, 22 and 26  May 1998
Date last submission received:	5 June 1998
Date of Judgment:	15 September 1998