Hannigan v Inghams Enterprises Pty Ltd

[2021] NSWSC 641

Supreme Court

New South Wales

Medium Neutral Citation:

Hannigan v Inghams Enterprises Pty Ltd [2021] NSWSC 641

Hearing dates:

28 May 2021

Date of orders:

7 June 2021

Decision date:

07 June 2021

Jurisdiction:

Equity - Commercial List

Before:

Stevenson J

Decision:

Application to stay proceedings dismissed

Catchwords:

ESTOPPEL – estoppel by judgment – Anshun estoppel – unreasonableness of conduct – where plaintiff commenced proceedings seeking declaration that contract with defendant not terminated – where Robb J made such a declaration – where plaintiff now brings second proceeding under the same contract seeking damages – whether it was unreasonable for plaintiff not to have brought damages claim in earlier proceedings – whether second proceedings should be stayed

Legislation Cited:

Civil Procedure Act 2005 (NSW)

Supreme Court Act 1970 (NSW)

Cases Cited:

Bazos v Doman [2001] NSWCA 347

Boles v Esanda Finance Corp Ltd (1989) 18 NSWLR 666

Bryant v Commonwealth Bank of Australia (1995) 57 FCR 287

Champerslife Pty Ltd v Manojlovski (2010) 75 NSWLR 245; [2010] NSWCA 33

Clayton v Bant [2020] HCA 44; (2020) 385 ALR 41

Egglishaw v Australian Crime Commission (2007) 164 FCR 224; [2007] FCAFC 183

Gibbs v Kinna [1998] VSCA 52; [1999] 2 VR 19

Habib v Radio 2UE Sydney Pty Ltd [2009] NSWCA 231

Hannigan v Inghams Enterprises Pty Ltd [2019] NSWSC 321

Henderson v Henderson (1843) 3 Hare 100; 67 ER 313

Inghams Enterprises Pty Ltd v Hannigan [2020] NSWCA 82

Ling v Commonwealth (1996) 68 FCR 180

Macquarie Bank Ltd v National Mutual Life Association of Australia Ltd (1996) 40 NSWLR 543

Mandeville v Better Lending Pty Ltd [2021] SASCA 28

Neeta (Epping) Pty Ltd v Phillips (1974) 131 CLR 286

Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589

Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 507; [2015] HCA 28

Vehicle Monitoring Systems Pty Ltd v SARB Management Group Pty Ltd (t/as Database Consultants Australia) [2020] FCA 6; (2020) 149 IPR 370)

Wong v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 146 FCR 10; [2004] FCAFC 242

Zavodnyik v Alex Constructions Pty Ltd (2005) 67 NSWLR 457; [2005] NSWCA 438

Category:

Procedural rulings

Parties:

Francis Gregory Hannigan (Plaintiff/Respondent)
Inghams Enterprises Pty Limited (Defendant/Applicant)

Representation:

Counsel:
M S Henry SC (Plaintiff/Respondent)
P S Braham SC with D Neggo (Defendant/Applicant)

Solicitors:
Hannigans (Plaintiff/Respondent)
Paradise Charnock O’Brien (Defendant/Applicant)

File Number(s):

SC 2020/313184

Judgment

1. The plaintiff, Mr Hannigan, is a chicken grower at a farm near Casino. He is also a solicitor. The defendant, Inghams Enterprises Pty Ltd (“Inghams”), supplies broiler chickens to the market. On 16 October 2016, Mr Hannigan and Inghams entered a “Broiler Chicken Growing Agreement” (“the Contract”) pursuant to which Inghams agreed to supply batches of one day old chickens to Mr Hannigan and Mr Hannigan agreed to raise the chickens for various periods, typically 30 days.

2. On 8 August 2017, Inghams purported to terminate the Contract. It did so on two bases. First, Inghams alleged that Mr Hannigan had, in breach of his obligations under the Contract, failed to obtain sample weights for the chickens in his custody and provide these to Inghams. Second, Inghams alleged that, in further breach of the Contract, Mr Hannigan had failed to provide feed to chickens in “Sheds 3 and 4” on 30 and 31 July 2017. Inghams stated that “no further birds will be placed on the farm”. Inghams did not supply chickens to Mr Hannigan’s farm after 29 July 2017.

3. Mr Hannigan asserted that Ingham’s purported termination of the Contract amounted to a repudiation of it. Mr Hannigan did not accept that alleged repudiation, affirmed the Contract and on 30 August 2017 commenced proceedings in this Court seeking a declaration that the Contract had not been terminated (“the Earlier Proceedings”).

4. Mr Hannigan did not seek any consequential relief in the Earlier Proceedings. He sought neither specific performance of the Contract, nor damages. This was a deliberate decision. I will return to this.

5. The matter was heard before Robb J over six days between August and November 2018. [1] On 29 March 2019, Robb J delivered judgment. [2]

   1. The hearing was on 6, 7, 8 and 9 August, 21 September and 8 November 2018.

   2. Hannigan v Inghams Enterprises Pty Ltd [2019] NSWSC 321 (Robb J).

6. Robb J found that:

1. in failing to obtain sample weights and provide that information to Inghams, Mr Hannigan has acted in breach of cl 4.2 of the Contract but that cl 4.2 was not a fundamental term, a breach of which would entitle Inghams to terminate; [3]

2. Inghams had failed to establish that the chickens had run out of feed no later than 5:30 am on 30 July 2017; [4] and

3. Inghams was not entitled to terminate the Contract. [5]

   3. At [376]; [383] and [388].

   4. At [298], [388].

   5. At [299].

7. Robb J made a declaration that the parties were bound by the Contract.

8. On 13 May 2019, Robb J made a further declaration that the Contract had not been terminated by Inghams’ letter of 8 August 2017.

9. Inghams recommenced supply of chickens on 25 June 2019.

10. On 16 August 2019, Mr Hannigan informed Inghams that he proposed to refer his damages claim to arbitration.

11. Inghams disputed Mr Hannigan’s entitlement to do this and further litigation ensued (“the Arbitration Proceedings”). On 16 September 2019, Slattery J, sitting as Duty Judge, held that Mr Hannigan was so entitled. [6] Inghams appealed and on 4 May 2020 the Court of Appeal, by majority, upheld the appeal. [7]

    6. Inghams Enterprises Pty Limited v Hannigan [2019] NSWSC 1186.

    7. Inghams Enterprises Pty Ltd v Hannigan [2020] NSWCA 82 (Meagher and Gleeson JJA; Bell P dissenting).

12. On 20 November 2020, Mr Hannigan commenced these proceedings seeking damages under the Contract in relation to Ingham’s failure to supply chickens between 29 July 2017 and 25 June 2019.

13. By notice of motion filed on 20 February 2021, Inghams seeks a permanent stay of these proceedings on the basis that it was unreasonable of Mr Hannigan not to have brought his damages claim in the Earlier Proceedings. That is, Inghams asserts an Anshun estoppel.

Decision

14. I am not persuaded that I should stay these proceedings.

Relevant principles

15. In proceedings before a court of competent jurisdiction, the parties are required to bring forward their whole case. [8]

    8. Henderson v Henderson (1843) 3 Hare 100; 67 ER 313 at 319, [115].

16. A party will not be permitted to raise, in a subsequent proceeding, a claim or an issue of fact or law that is so connected or so relevant to the subject matter of the first proceeding that it was unreasonable of that party to have not made the claim or raised the issue in the first proceeding.

17. The principle applies whether or not the failure to propound the claim or issue was deliberate or as a result of negligence, inadvertence or accident.

18. These principles derive from a line of authorities[9] which establish the following propositions regarding Anshun estoppel: [10]

    9. Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 at 598-602 (Gibbs CJ, Mason and Aickin JJ); [1981] HCA 45, Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 507 at 513; [2015] HCA 28 at [22] (French CJ, Bell, Gageler and Keane JJ), Champerslife Pty Ltd v Manojlovski (2010) 75 NSWLR 245; [2010] NSWCA 33 at [3] (Allsop P, Handley AJA agreeing at [92]) and Zavodnyik v Alex Constructions Pty Ltd (2005) 67 NSWLR 457 at 463; [2005] NSWCA 438 at [34] (Handley JA, with Mason P and Latham J agreeing).

    10. This summary is, largely, taken from the submissions of Mr Henry SC, who appeared for Mr Hannigan.

1. the question is not whether it would have been reasonable to have made the subject claim in the first proceeding. The question is whether the failure to do so was unreasonable in the context of the first proceeding; [11]

   11. Vehicle Monitoring Systems Pty Ltd v Sarb Management Group Pty Ltd (t/as Database Consultants Australia) [2020] FCA 6; (2020) 149 IPR 370 at [40] citing Gibbs v Kinna [1998] VSCA 52; [1999] 2 VR 19 at [1].

2. the party asserting the estoppel must demonstrate not only that the relevant claim could have been made in the first proceeding but, also, that it should have been made, in the sense that it was unreasonable for the claim to not have been made; [12]

   12. Clayton v Bant [2020] HCA 44; (2020) 385 ALR 41 at [31]; Champerslife Pty Ltd v Manojlovski (2010) 75 NSWLR 245; [2010] NSWCA 33 at [4].

3. assessing unreasonableness in this context requires a forward-looking evaluation taken at the time of the first proceeding, not a determination made subsequently with the benefit of hindsight; [13]

4. the likelihood of inconsistent judgments would, generally speaking, satisfy the criterion of unreasonableness; [14]

5. the party asserting the estoppel must establish that the rights the subject of the estoppel claim corresponded with rights that should reasonably have been the subject of the first proceeding. [15] Substantial correspondence suffices. [16] It is enough if the rights are of a substantially equivalent nature and cover the same subject matter. [17] It is insufficient that the rights arose from the same transaction [18] or that the two proceedings are closely related. [19]

6. the party asserting the estoppel bears the onus of establishing a factual foundation for the estoppel. [20] This includes positively establishing that the same, or substantially the same, facts are relevant to the claims in both proceedings; [21] and

7. shutting out a claim that a party wishes to pursue without determination of its intrinsic merit on the ground that it ought to have been raised in earlier litigation is a serious step; it is a power that is not to be exercised except “after a scrupulous examination of all of the circumstances”. [22]

13. Vehicle Monitoring Systems Pty Ltd v Sarb Management Group Pty Ltd (t/as Database Consultants Australia) at [73].

14. Boles v Esanda Finance Corp Ltd (1989) 18 NSWLR 666 at 673 (Samuels JA, Priestley and Meagher JJA agreeing); Gibbs v Kinna at [25]-[28].

15. Clayton v Bant at [32].

16. Clayton v Bant at [34].

17. Ibid.

18. Clayton v Bant at [35]-[36].

19. Bazos v Doman [2001] NSWCA 347 at [44] (Stein JA, with Priestley and Beazley agreeing).

20. Clayton v Bant at [30].

21. Egglishaw v Australian Crime Commission (2007) 164 FCR 224 at [25]; Bazos v Doman at [39].

22. Habib v Radio 2UE Sydney Pty Ltd [2009] NSWCA 231 at [85] (McColl JA, Giles and Campbell JJA agreeing) citing Ling v Commonwealth (1996) 68 FCR 180 at 182 (Wilcox J).

This case

19. Mr Braham SC, who appeared with Mr Neggo for Inghams, submitted that permitting Mr Hannigan to proceed with this case would be “setting a standard” as to the permissible mode conducting commercial litigation in the “modern age”. I do not see it that way. Like most Anshun cases, this case turns on its own facts. The facts here are unusual. I do not see this case as setting, one way or the other, a precedent for how litigation is or should be conducted.

20. For the same reasons, I think it unhelpful to examine how Anshun principles have been applied in other cases. I found none of the cases to which Mr Braham, and Mr Henry SC, who appeared for Mr Hannigan, took me to, to shed light on what I should do here.

Could Mr Hannigan have claimed damages in the Earlier Proceedings?

21. Although the debate before me ranged more widely, I see the vital questions as being whether Mr Hannigan could have claimed damages in the earlier proceedings, and, if so, how that claim could have been case managed.

22. As I have said, Mr Hannigan did not accept Inghams’ purported termination of the Contract and sought to affirm it. Accordingly, Mr Hannigan was not entitled in the Earlier Proceedings to seek loss of bargain damages, as he was seeking to uphold the bargain.

23. On the day Mr Hannigan filed the Summons in the Earlier Proceedings, 30 August 2017, he had not suffered the damage of which he complains in these proceedings. On 30 August 2017, beyond nominal damages, the only damage Mr Hannigan may have suffered was associated with his maintenance of sheds and equipment at the farm.

24. Mr Hannigan’s damages arising from Inghams’ failure to continue to provide chickens only arose as and when an entitlement to payment would have arisen under the Contract had Inghams delivered batches of chickens in accordance with the Contract.

25. The first such payment would have arisen in late October 2017. Damages would then accrue progressively at the points in time when Mr Hannigan would otherwise have been entitled to be paid.

26. Mr Hannigan seeks in these proceedings to recover damages in respect of Inghams failure to provide chickens between 30 July 2017, being the last date in which Inghams had delivered chickens, and 25 June 2019, being the date when Inghams resumed providing chickens. At no time during the Earlier Proceedings had all these damages accrued. Until it was determined whether Mr Hannigan was correct to contend that the Contract had not been validly terminated, Mr Hannigan did not know, and could not know, during what period his damages should be calculated.

27. This would not have prevented Mr Hannigan from including a prayer for damages in the Earlier Proceedings. But until it was determined whether or not the Contract had been validly terminated, no final assessment of those damages could be made.

28. In these circumstances it is likely, if not inevitable, that had Mr Hannigan claimed damages in the Earlier Damages there would have had to be a separate hearing on damages. Until Mr Hannigan knew when and whether it would be determined that the Contract had been validly terminated, he could not know if he had a claim for damages and, assuming he could establish he had one, during what period damages should be calculated.

29. In those circumstances Mr Braham accepted that:

“I acknowledge that it is very likely there would have been two hearings and two judgments in the earlier proceedings if Mr Hannigan had commenced his whole case the first time, and as your Honour put to me, we might be in exactly the same position we would have been in but in the same proceedings had he done it as we would say properly.”

30. Had Mr Hannigan included a claim for damages in the Earlier Proceedings it would doubtless have caused delay in those proceedings.

31. As it was, the matter was ready for allocation of a hearing date by the end of 2017. On 8 February 2018, the matter was fixed for hearing for four days commencing on 6 August 2018 before Robb J. [23]

    23. As it turned out, two further days, 21 September 2018 and 8 November 2018 were required for the hearing.

32. Had Mr Hannigan, by 8 February 2018, foreshadowed a damages claim it appears unlikely that a hearing date would then have been allocated and likely that directions would have been made for the parties to exchange evidence on damages, which evidence is likely to have included expert evidence.

33. As I have said, it is likely that such evidence would have had to be considered, at a subsequent hearing, no doubt by Robb J.

Was it unreasonable of Mr Hannigan not to have sought damages in the Earlier Proceedings?

34. It is, of course, usually desirable that a party brings forward all aspects of its cause of action in one proceeding.

35. This is consistent with s 63 of the Supreme Court Act 1970 (NSW) which provides:

“The Court shall grant, either absolutely or on terms, all such remedies as any party may appear to be entitled to in respect of any legal or equitable claim brought forward in the proceedings so that, as far as possible, all matters in controversy between the parties may be completely and finally determined, and all multiplicity of legal proceedings concerning any of those matters avoided.”

36. This is also consistent with the obligation that parties in civil proceedings have to assist the Court and further the overriding purpose of facilitating a just, quick and cheap resolution of the real issues in the proceedings. [24]

    24. Ss 56 and 57 Civil Procedure Act 2005 (NSW)

37. Further, in Neeta (Epping) Pty Ltd v Phillips [25] the High Court [26] said: [27]

“Unless the parties are agreed on the consequences which flow from a declaration that such a contract has or has not been validly rescinded it is generally undesirable that a court should so declare without any orders for consequential relief.”

25. (1974) 131 CLR 286.

26. Barwick CJ and Jacobs J, Stephen J agreeing.

27. At 307.

38. It is also true, as Mr Braham submitted, that there is only one “controversy” between Mr Hannigan and Inghams and that Mr Hannigan has only one cause of action against Inghams.

39. Mr Hannigan understood this.

40. His unchallenged explanation as to why he did not seek damages in the Earlier Proceedings was contained in this passage from an affidavit that he swore in the Arbitration Proceedings:

“The relief that I sought in the Earlier Proceedings was declaratory relief and a costs order. My purpose in seeking that relief was to have the Court determine the then existing dispute between the parties as to whether Inghams had terminated the Contract. By its letter dated 8 August 2017, Inghams said that the Contract was terminated. I disagreed with Inghams and, in my letter dated 21 August 2017, stated that the Contract remained on foot. I wanted to have that dispute determined as quickly as possible. I have 6 chicken sheds on my property which, collectively, house approximately 210,000 chickens. The logistics and costs of running those sheds are both substantial. For this reason, I wanted certainty as to whether the Contract remained on foot as soon as possible. I believed that the quickest way in which I was likely to obtain that certainty, by a judgment of the Court, was to confine the matters in dispute in the Earlier Proceedings. I did not want to delay, complicate or increase the cost of those proceedings with further claims for damages. I believe that, if I had claims for damages, I could make those claims at a later time (subject to limitation statutory provisions); and whether I had any damages claims was uncertain until final orders were made by Robb J on 13 May 2019. Throughout the course of the Earlier Proceedings I believed that I had reserved my position to claim damages at a later point if I had such a claim.” (My emphasis)

41. Mr Hannigan did not apply for expedition and has not explained why he did not take that step. That does weigh against the reasonableness of Mr Hannigan’s position.

42. Subject to that, what Mr Hannigan said, as set out at [40], appears to me to be a reasonable explanation for the course Mr Hannigan adopted.

43. In substance, what Mr Hannigan sought to do was to obtain prompt resolution of his claim that the Contract had not been terminated.

44. As things turned out, although the matter was ready for a hearing date in February 2018, a date suitable to the parties was not available until August 2018. The proceedings then took longer than the allocated four days. The hearing did not conclude until 8 November 2018, with judgment following on 29 March 2019.

45. Inghams was well aware of the potential significance of the manner in which Mr Hannigan had formulated his claim in the Earlier Proceedings.

46. Thus, when the matter was listed for directions before Robb J on 10 May 2018, the following exchange took place between his Honour and Mr Henry:

“HIS HONOUR: On the face of it, looking at the amended summons, the plaintiff’s objective is to demonstrate that the contract, whichever it is, is still on foot and there is no breach or damages claim.

HENRY: There’s no claim for damages presently, and I’m not suggesting it would arise in these proceedings. The position on that front is that the plaintiff has reserved its position. Whether it at a later point in time brings a claim for damages is obviously yet to be seen. Frankly, the reason for that approach was to try to have this resolved as soon as possible, because the position is that there’s a farm with substantial chicken sheds on it which are empty and have been empty since – I can’t recall the date in particular, but it would be late August last year.

So the proceedings were brought in the hope to have the question of termination resolved as expeditiously as possible without being delayed by complicating things with further claims for damages and the associated time and cost associated with it. So the plaintiff won’t be claiming damages in these proceedings, but that shouldn’t be taken as – that’s why it’s confined in the way it is.

HIS HONOUR: The objective is obviously to limit the loss rather than to fight over it at this stage.”

47. Later, the following exchange took place between his Honour and Mr Neggo, who appeared for Inghams:

“NEGGO: …I’m not going to ask your Honour to actually do anything in relation to what I have to say but I feel I should just state in relation to what my friend says as to the possibility of a damages claim at some time in the future; the plaintiff can take its own course about that. I don’t say that the course that my learned friend has alluded to today is wrong or right but that is not something which has been the subject of any discussion between the parties or agreement between the parties. I just feel I should make that clear so that there’s no suggestion of any acquiescence later by the defendant in relation to that course.

HIS HONOUR: Yes, well, I understand that; it’s reasonable for you to say that. I note that Mr Hannigan says that $3.6 million was borrowed to establish a chicken farm that is like a hole in the ground unless there are chickens to farm there. I think the plaintiff may be disappointed that the Court has not been able to give an earlier hearing date. The proposition that the plaintiff would wish to establish as soon as possible that the contract remains on foot is commercially understandable because plainly it’s just a complete disaster from the plaintiff’s perspective if he has to accept that the contract’s gone and then he has to pick over the bones to try and get his damages back.”

48. Mr Neggo, and thus Inghams, neither agreed nor opposed the matter proceeding to hearing on the basis that Mr Hannigan sought only declaratory relief. Mr Neggo made clear that Inghams did not acquiesce in the course proposed. But nor did it oppose it.

49. Robb J returned to the subject in his judgment when he said:[28]

“Thirdly, it is notable that, by his prayers for relief, Mr Hannigan only seeks declarations that the parties are bound by a particular agreement, and that Inghams’ 8 August 2017 letter did not terminate the agreement. Mr Hannigan has not sought any consequential relief, either in the nature of orders obliging Inghams to implement the agreement, or ordering Inghams to pay damages to Mr Hannigan for breach of the agreement. As Inghams ceased to deliver chickens to Mr Hannigan after it purported to terminate the agreement, it may be imagined that Mr Hannigan may have suffered some damage. The Court does not know what Mr Hannigan’s aspirations are concerning the possible continuity of the performance of the agreement, if it is found by the Court to be valid and to continue in effect. The Court does not know what course Inghams proposes to take in that event. If Mr Hannigan succeeds in these proceedings, the only result will be that he will establish that he has an agreement in terms of the Inghams Agreement, and that the agreement has not been terminated. Mr Hannigan will apparently be satisfied with that outcome, and Inghams has not suggested that Mr Hannigan’s claims are incomplete as he has not sought in these proceedings all of the relief to which he may be entitled. As the parties have been content to proceed on that basis, so will the Court.” (My emphasis)

28. Hannigan v Inghams Enterprises Pty Ltd [2019] NSWSC 321 at [24].

50. As Mr Henry emphasised in his submissions, the question here is not whether it was reasonable for Mr Hannigan to adopt the course of seeking only declaratory relief in the Earlier Proceedings. The question is whether it was unreasonable of him not also to seek damages, either at the outset of the Earlier Proceedings or by amendment during the course of the proceedings.

51. In the troubled circumstances in which Mr Hannigan found himself, I am not persuaded it was unreasonable of him to take the course he took.

52. It does appear that some of the issues debated before Robb J will, at one level or another, be reagitated in these proceedings.

53. Inghams has foreshadowed that it proposes to seek leave to amend its List Response to allege, in answer to Mr Hannigan’s damages claim, a failure by Mr Hannigan to comply with certain provisions in the Contract concerning “Animal Welfare Standards”. Inghams proposes to contend that such failure would or may, during the period the subject of Mr Hannigan’s damages claim, have entitled it to either terminate the Contract or to exercise its rights to “invoke density cuts” on the number of chickens provided. This would restrict the supply of chickens supplied to Mr Hannigan’s farm.

54. I cannot see how this prospect raises the spectre of inconsistent findings. The doctrine of issue estoppel will govern the extent to which Inghams or Mr Hannigan can reagitate matters that have been determined by Robb J.

55. However, there is the prospect, were these proceedings to continue, of similar factual matters being debated and of witnesses who gave evidence before Robb J being recalled in these proceedings.

56. But, had Mr Hannigan included a damages claim in the Earlier Proceedings, and because of the likelihood of there being a separate hearing on damages, these problems would have arisen in any event, albeit in circumstances where Robb J were likely to have been the judge hearing both aspects of the case.

57. Overall, I am not persuaded that it was unreasonable of Mr Hannigan not to seek damages in the Earlier Proceedings.

Special circumstances

58. In any event, in my opinion, there are special circumstances here that warrant the conclusion that, even if it was unreasonable of Mr Hannigan not to have claimed damages in the Earlier Proceedings, he should not be restrained from pursuing that claim in these proceedings.

59. In a recent decision of the South Australian Supreme Court,[29] the Court of Appeal [30] said:[31]

“The inquiry into unreasonableness, informed by the prospect of conflicting judgments, is not necessarily the end of the matter. The Court in Anshun appears to have accepted that a conclusion of unreasonableness may yet admit of exceptions. To this end, in Wong v Minister for Immigration and Multicultural and Indigenous Affairs, the Full Federal Court (in distinguishing the operation of Anshun estoppel from the doctrines of res judicata and issue estoppel), said [at [38]]:

‘As foreshadowed in Anshun, there will be instances where, even though there is every reason why the matter should have been raised earlier but was not, there are special circumstances that prevail to permit a party to raise the issue in a subsequent proceeding. The Court therefore has a discretion, if it determines that special circumstances exist, to allow an issue to be raised, even where it is found that the point was unreasonably omitted from the earlier proceeding: see Macquarie Bank Ltd v National Mutual Life Association of Australia Ltd …at 558 …’”

29. Mandeville v Better Lending Pty Ltd [2021] SASCA 28.

30. Doyle, Livesey and Bleby JJA.

31. At [109].

60. The special circumstances here are that, having affirmed the Contract and needing urgently to know whether it remained on foot, Mr Hannigan had no practical means available to him whereby he could perfect his damages claim before knowing whether he still had a contract. This situation arose as a result of provisions in the Contract governing how and when Inghams was to pay Mr Hannigan.

61. Thus, he and Inghams faced the prospect of a separate hearing on damages, whether or not Mr Hannigan claimed damages in the Earlier Proceedings.

62. And Inghams did not actively oppose matters proceeding as they did, perhaps because it appreciated the reality of the position it was in. Inghams surely could not have thought that Mr Hannigan, upon achieving success in his pursuit of a declaration, would not wish to take matters further.

63. Mr Hannigan did, of course, seek to take matters further by having the question of damages referred to arbitration, thus leading to the Arbitration Proceedings.

64. Overall, I think it would be most unjust now to shut out Mr Hannigan from pursuing the damages claim he wishes to make. I see that, in the particular circumstances of this case, to be a special circumstance tending against the granting of the stay sought by Inghams.

Conclusion

65. I am not persuaded to grant the stay of proceedings sought by Inghams.

66. Inghams’ Notice of Motion of 20 February 2021 should be dismissed with costs.

67. I will list this matter for directions on 11 June 2021 before the Commercial List Judge.

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Endnotes

Decision last updated: 07 June 2021