Four Oaks Enterprises Pty Ltd v Clark (No 2)

[2003] TASSC 70

[2003] TASSC 70

CITATION:            Four Oaks Enterprises Pty Ltd v Clark (No 2) [2003] TASSC 70

PARTIES:  FOUR OAKS ENTERPRISES PTY LTD
  V
  CLARK, Keith

TITLE OF COURT:  SUPREME COURT OF TASMANIA
JURISDICTION:  ORIGINAL
FILE NO/S:  M144/2002
DELIVERED ON:  11 August 2003
DELIVERED AT:  Hobart
HEARING DATES:  24 March 2003
JUDGMENT OF:  Blow J

CATCHWORDS:

Procedure – Judgments and orders – Amending, varying and setting aside – Variation and setting aside of consent judgment – Order giving expression to agreement between parties – Whether order gave effect to contract between parties.

Siebe Gorman & Co Ltd v Pneupack Ltd [1982] 1 All ER 377; Baines v State Bank of New South Wales (1985) 2 NSWLR 729; Cliffs Robe River Iron Associates v Dravo Pty Ltd [1988] WAR 322; R D Werner & Co Inc v Bailey Aluminium Products Pty Ltd (1988) 80 ALR 134, followed.
Aust Dig Procedure [488]

REPRESENTATION:

Counsel:
           Applicant:  A Valentine
           Respondent:  N R Readett
Solicitors:
           Applicant:  Ware & Partners
           Respondent:  Clerk Walker & Stops

Judgment Number:  [2003] TASSC 70
Number of Paragraphs:  16

Serial No 70/2003
File No M144/2002

FOUR OAKS ENTERPRISES PTY LTD v KEITH CLARK (NO 2)

REASONS FOR JUDGMENT  BLOW J

11 August 2003

1. This is an application pursuant to the "slip rule" ¾Rules of the Supreme Court 2000, r435.  Pursuant to that rule, the applicant is seeking a certificate for counsel, ie, a certificate that the hearing of the originating application herein was a matter proper for the attendance of counsel.  The application is opposed.

1. The principal proceedings concerned a caveat lodged by the respondent, which prohibited dealings in respect of land owned by the applicant.  By its originating application, the applicant applied for an order that the respondent show cause why his caveat should not be removed, and for an order that it be removed.  The respondent appeared to show cause.  After a defended hearing, I ordered that the caveat be removed.  On the day I made that order, counsel for the applicant made an application for costs, and I adjourned that application sine die.  Subsequently the solicitors for both parties wrote to the Registrar in the following terms, under the letterhead of the applicant's solicitors:

"This matter is listed before His Honour Mr Justice Blow at 10:00 am on Monday the 8^th July 2002. 

By consent we seek an order as follows:

That the Respondent pay the Applicant's costs of the application."

I so ordered on 8 July 2002. 

1. The originating application was heard as a proceeding in chambers in accordance with the Rules of the Supreme Court, r90(1)(zo).  In such cases, a counsel's fee will not be allowed on the taxation of costs in the absence of a certificate for counsel.  That is because of r863(2), which reads as follows:

"(2)   A counsel's fee is not allowed in respect of any appearance before a judge in chambers unless ¾

(a)the judge has certified for counsel; or

(b)the matter is the hearing of an appeal from an inferior court or a statutory tribunal other than a court."

1. There is no doubt that the hearing of the originating application was a matter proper for the attendance of counsel.  It raised difficult questions of law as to the distinction between a sale of goods and a grant of a profit à prendre, as to the significance of irregularities in caveats, and as to the applicability of the "balance of convenience" test that is applied in relation to interlocutory injunctions: Four Oaks Enterprises Pty Ltd v Clark [2002] TASSC 39. However counsel for the respondent opposed the application under the slip rule on the basis that, at the time the solicitors for the parties sought the consent order as to costs, a contract between the parties had come into existence, and that contract precluded the applicant from seeking a certificate for counsel.

1. It is well established that, when a certificate for counsel has not been sought as a result of inadvertence, there is power to grant one pursuant to the slip rule: Kral v Hydro Electric Commission (No 2) 33/1977 Chambers J (noted at [1977] Tas SR 135 (NC 11)); Dougherty v Dougherty (1889) 15 VLR 294; In re Wetzell; ex parte The Commissioners of the State Savings Bank [1919] VLR 14; McKenzie v Fyander [1927] VLR 569; Flack & Flack v McCowan [1923] QWN 5. Counsel for the respondent did not argue otherwise.

1. There are a number of reported cases which tend to suggest that, whenever a consent order is made, there exists a binding contract between the parties who consented to it.  In Wentworth v Bullen (1829) 9 B & C 840, 109 ER 313, Parke J said at B & C 850, ER 316:

"The contract of the parties is not the less a contract, and subject to the incidents of a contract, because there is superadded the command of the Judge."

Two cases in the Supreme Court of Queensland have been decided on that basis: Re Dittmer Gold Mines (No 3) [1954] St R Qd 275 at 280; Rayner v Rayner [1968] QWN 42 at 95.

1. However the term "consent order" is somewhat ambiguous, and a number of cases in appellate courts have made it clear that only some, and not all, consent orders, are the product of binding contracts.  In Chandless-Chandless v Nicholson [1942] KB 321 at 324, Lord Greene MR said:

"There is a great deal of difference between a consent order in the technical sense and an order which embodies provisions to which neither party objects.  The mere fact that one side submits to an order does not make that order a consent order within the technical meaning of that expression …".

1. In Siebe Gorman & Co Ltd v Pneupack Ltd [1982] 1 All ER 377, Lord Denning MR, with whom the other members of the Court of Appeal agreed, said:

"It should be clearly understood by the profession that, when an order is expressed to be made 'by consent', it is ambiguous.  There are two meanings to the words 'by consent'.  That was observed by Lord Greene MR in Chandless-Chandless v Nicholson [1942] 2 All ER 315 at 317, [1942] 2 KB 321 at 324. One meaning is this: the words 'by consent' may evidence a real contract between the parties. In such a case the court will only interfere with such an order on the same grounds as it would with any other contract. The other meaning is this: the words 'by consent' may mean 'the parties hereto not objecting'. In such a case there is no real contract between the parties. The order can be altered or varied by the court in the same circumstances as any other order that is made by the court without the consent of the parties. In every case it is necessary to discover which meaning is used. Does the order evidence a real contract between the parties? Or does it only evidence an order made without obligation?"

1. That passage was quoted with approval in Cliffs Robe River Iron Associates v Dravo Pty Ltd [1988] WAR 322 by Wallace J at 324 and by Kennedy J at 327. In that case the Western Australian Full Court took the view that a consent order excusing a defendant from filing and serving a defence until fourteen days after the production of certain eye bolts for inspection did not evidence a binding contract.

1. In Baines v State Bank of New South Wales (1985) 2 NSWLR 729, it was submitted that an interlocutory order made by consent can never be regarded as constituting a contract which a court will not interfere with, except on the same grounds as it would interfere with any other contract. Powell J rejected that submission, and said at 738:

:… it is for the Court to determine on the facts of each particular case whether the words 'by consent' evidence a real contract between the parties or only an order made without obligation."

1. In R D Werner & Co Inc v Bailey Aluminium Products Pty Ltd (1988) 80 ALR 134, a consent order had been made in the Federal Court for the appellant to give security for costs by paying money into court, and for the appeal to be dismissed in default of such payment. It was submitted to the Full Court that the consent order evidenced a binding contract, and that the court therefore could not vary the order. In determining whether a binding contract had been entered into, all members of the court considered the evidence as to the circumstances in which the agreement to seek a consent order was reached. The Full Court held unanimously that the consent order gave effect to a binding contract between the parties, but that the court still had a power to vary the consent order. The members of the court took different views as to the source of that power. Woodward and Foster JJ took the view that the court could still exercise its inherent power to control its own proceedings by varying interlocutory orders made as the result of a binding contract. Jenkinson J held that the contract did not contain an implied term that the appellant would not invoke the court's power to extend time.

1. In the light of these authorities, it is clear that a consent order for the payment of costs might or might not be the product of a binding contract, depending on the circumstances leading up to its making.  In the old authorities that seem to suggest otherwise, the term "consent order" is used in the narrow sense of an order that is the product of a contract.  If a consent order is the product of a binding contract, the court should not vary it or impose any obligation inconsistent with the contract unless either (a) there exists some circumstance, such as fraud, mistake or undue influence, which would warrant the granting of relief under the general law of contract, or (b) the Court could and should vary the order on one of the grounds for variation discussed in R D Werner & Co Inc v Bailey Aluminium Products Pty Ltd (supra).

1. Mr Readett contended on behalf of the respondent that the consent order evidenced a contract between the parties.  The respondent therefore bore the onus of proving, on the balance of probabilities, the making of such a contract.  No evidence was adduced as to the circumstances in which the consent order was made.  Consequently I can have regard only to the record of the Court for the purpose of determining whether it has been established that a contract was made. 

1. The applicant had been successful in obtaining an order for the removal of the caveat.  There was nothing about the proceedings that would warrant a submission that the Court should depart from the general practice of ordering the unsuccessful party to pay the successful party's costs.  There was nothing about the proceedings to suggest that costs should be ordered otherwise than on a party and party basis.  For the reasons I have explained, the hearing warranted the attendance of counsel.  The applicant's solicitors had in fact briefed as counsel a practitioner from another firm.  Had they sought an order for costs and a certificate for counsel, I can see no reason why they might not have successfully obtained both.  There is every indication that the failure to request a certificate for counsel must have been the result of an oversight.  There is nothing in the circumstances apparent from the record of the Court to suggest a contract was made whereby the applicant promised not to seek a certificate for counsel, and the respondent gave some consideration for that promise.  In the circumstances, I am not satisfied that the consent order evidences a binding contract between the parties.

1. If I am wrong as to that, and a contract between the parties did come into existence, I do not think such a contract would include an implied term that the applicant would not seek a certificate for counsel.  The implication of such a term is not necessary to give business efficacy to a contract requiring the respondent to pay the applicant's costs.  Such a term is not so obvious that it goes without saying, nor is it reasonable or equitable.  See BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 190 CLR 266 at 283.

1. I certify for counsel in relation to the hearing on 20 June 2002.