Greenbushes Ltd v Charles Hull Contracting Co Pty Ltd

[2000] WASC 311

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   GREENBUSHES LTD -v- CHARLES HULL CONTRACTING CO PTY LTD [2000] WASC 311

CORAM:   MASTER BREDMEYER

HEARD:   1 DECEMBER 2000

DELIVERED          :   8 DECEMBER 2000

PUBLISHED           :  15 DECEMBER 2000

FILE NO/S:   CIV 1867 of 1997

BETWEEN:   GREENBUSHES LTD (ACN 004 603 516)

Plaintiff

AND

CHARLES HULL CONTRACTING CO PTY LTD (ACN 008 694 406)
Defendant

Catchwords:

Pleading - Particulars - Further and better particulars

Legislation:

Nil

Result:

Application allowed in part

Representation:

Counsel:

Plaintiff:     Mr R J Ainslie

Defendant:     Dr P R MacMillan

Solicitors:

Plaintiff:     Mallesons Stephen Jaques

Defendant:     Pye & Quartermaine

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

Nil

Case(s) also cited:

Nil

1. MASTER BREDMEYER:  This is an application by the defendant for further and better particulars of par 7(ii) of the plaintiff's reply and defence to counterclaim which reads:

   "7(ii)The reduction in the quantities shown in the schedule of rates did not result from a direction of the Superintendent under clause 40.1 but was a result of there being less quantities than anticipated to perform the contract."

2. I consider that pleading needs amendment because it does not express accurately the plaintiff's case.  The plaintiff's case is that from time to time the drop in demand and price for the product made it uneconomic to mine the quantities that were otherwise going to be mined.  I will return to this point in a moment.

3. I need not go into the long procedural history of this application for further and better particulars.  The defendant's latest request for particulars has been answered by the plaintiff in a document dated October 2000, Amended Plaintiff's Answers to Defendant's Request for Particulars of Reply and Defence to Counterclaim, dated 4 July 1998.  The defendant says the answers are inadequate.

4. The requests in several places refer to the word "ore", namely tantalum ore and lithium ore.  I do not accept the plaintiff's definition of "ore".  The plaintiff's counsel quoted to me a definition of "ore reserve" from the Australian Code for Reporting of Identified Mineral Resource Reserves and Ore Reserves:

   "That part of a Measured or Indicated Mineral Resource which could be mined, inclusive of dilution and from which valuable or useful minerals could be recovered economically under conditions realistically assumed at the time of reporting."  (Emphasis mine.)

   That definition is, I think, a special one, so that companies and investors are not misled by a geologist's report.  It is not the normal everyday meaning of the word.

5. The plaintiff's counsel also quoted to me a definition of "ore" from the Shorter Oxford Dictionary:

   "A native mineral containing a precious or useful metal in such quantity, etc, as to make its extraction profitable."

   I do not accept that definition as the most natural one for use in this case.  It is one of two definitions given in that dictionary, the second is "Metal - especially precious metal".  The Concise Oxford Dictionary, which is smaller than the Shorter Oxford Dictionary, gives one only definition of "ore" and it is not the same as the first definition quoted to me from the Shorter Oxford Dictionary.  It reads:

   "Solid naturally‑occurring mineral aggregate from which metal or other valuable constituents may be usefully extracted."

   That is a better definition.  The use of the word "ore" or material in this pleading does not imply a material from which precious or useful metal can be economically produced.

6. I consider Answer 1(b), (c) and (d) are not evasive and are proper answers.  They tell the defendant that 1,239,325 bcm's of tantalum ore was in the pit at the date of the contract.  That was an estimate.  That was thought to be economically recoverable based on world demand and price at that time.

7. Request 1(d) is in two parts.  It gives the plaintiff a choice of two questions to answer.  The plaintiff has chosen to answer the second one.  The criteria used by the plaintiff between February 1992 and June 1995 to assess whether the tantalum ore was recoverable, was world demand and price.  I consider that answer is sufficient.

8. Request 1(e) is in two parts.  The first part is "what quantity or quantities or tantalum ore which were economically recoverable at the date of the contract ceased thereafter to be economically recoverable?" - and the second part is - "and why?"  The answer given is as follows:

   "The difference between the quantities mined and an anticipated quantities of ore to be mined.  World demand resulted in there being less ore than estimated."

   I consider the first sentence of that answer is a proper one.  I consider the second sentence is not; it is evasive.  It is based on the definition of "ore" which I think it wrong.  I will strike it out.  It needs to be amended to say that world demand and price meant that it was not economically viable to recover the quantity set out in the schedule of rates.

9. Request 2 asks the same questions as request 1, but in relation to lithium ore.  It follows from my reasons that the answers are satisfactory, save that the second sentence of 2(e) will also be struck out.

10. To summarise, I strike out the second sentence of the answer to requests 1(e) and 2(e) and require further and better answers, and I suggest - based on the plaintiff's argument in this case - that the answer should be along these lines:

    "World demand and price meant that it was not economically feasible to recover it."

11. To return to my earlier point, I consider the plea itself in par 7(ii) of the plaintiff's reply in defence to counterclaim is evasive and hence embarrassing.  In its present form it means - on the ordinary meaning of the words - that the physical quantities of materials were less than shown in the schedule of rates.  The plaintiff's case, however, is that world demand and price for the product from time to time meant it was not economically viable to mine the quantities set out in the schedule of rates.  The pleading could be amended by adding the words underlined, for example:

    "The reduction in the quantities shown in the schedule of rates did not result from a direction of the Superintendent under clause 40.1 but was a result of there being less quantities of economically recoverable material than anticipated to perform the contract."

    I leave the precise words to the plaintiff.  With a plea like that in place, to find out what is meant by "economically recoverable" the particular given in the answers, namely, world demand and price, is a proper answer.  It means that a fall in the world demand and price meant that it was not economic to mine the quantities originally intended.  I will give leave to the plaintiff to amend par 7(ii) of the reply and defence to counterclaim within 14 days, failing which the defendant has leave to apply to strike out that plea.

12. The defendant would like to get from the plaintiff a schedule of dates and world prices starting at the date of the contract and covering the periods of reduced production, showing how the fall in the world price impacted on the production so that it can instruct an expert to lead evidence against it.  For example, to say that at a certain date the world price was X dollars and it was still viable to produce the original amount and therefore the plaintiff was wrong to direct a reduced target.  That is a matter, I think, for interrogatories or perhaps a special direction, rather than particulars.