Ireland v Norilya Minerals Pty Ltd - [2010] WASCA 203

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE COURT OF APPEAL (WA)

CITATION: IRELAND -v- NORILYA MINERALS PTY LTD [2010] WASCA 203

CORAM: McLURE P
NEWNES JA
MURPHY JA

HEARD: 12 OCTOBER 2010

DELIVERED : 20 OCTOBER 2010

FILE NO/S: CACV 104 of 2010

BETWEEN: ADAM JONATHON IRELAND as Executor of the Estate of DEAN EDWARD IRELAND
CLARK ERVIN EASTERDAY
LEONARD LANCELOT IRELAND
First Appellants
KAYLENE HOLDINGS PTY LTD
Second Appellant
BRENDA ANNE EASTERDAY
Third Appellant
WEBGO PTY LTD
Fourth Appellant
FIM PTY LTD
Fifth Appellant
PAUL CHRISTOPHER IRELAND
Sixth Appellant
AND
NORILYA MINERALS PTY LTD
Respondent

ON APPEAL FROM:
Jurisdiction              :  SUPREME COURT OF WESTERN AUSTRALIA
Coram  :LE MIERE J
Citation  :NORILYA MINERALS PTY LTD -v- ADAM JONATHON IRELAND as Named Executor of the Estate of DEAN EDWARD IRELAND [2010] WASC 260
File No  :CIV 2232 of 1990, CIV 2364 of 2007

Catchwords:

Practice and procedure - Application for leave to appeal on interlocutory decision

Practice and procedure - Abuse of process - Inability to recover monies subject to order of the Court of Criminal Appeal - Effect of impecuniousity of party

Legislation:

Rules of the Supreme Court 1935 (WA), s 60(1)(f)

Result:

Application for leave to appeal dismissed

Category: B

Representation:

Counsel:

First Appellants             :     Mr J A Thomson
Second Appellant          :     Mr J A Thomson
Third Appellant             :     Mr J A Thomson
Fourth Appellant            :     Mr J A Thomson
Fifth Appellant               :     Mr J A Thomson
Sixth Appellant              :     Mr J A Thomson
Respondent:     Mr S M Davies SC & Ms K F BanksSmith

Solicitors:

First Appellants             :     Bostock & Ryan
Second Appellant          :     Bostock & Ryan
Third Appellant             :     Bostock & Ryan
Fourth Appellant            :     Bostock & Ryan
Fifth Appellant               :     Bostock & Ryan
Sixth Appellant              :     Bostock & Ryan
Respondent:     Norton Rose Australia

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

Allmark v Mossensons (a firm) [2006] WASCA 127
Batistatos v Roads and Traffic Authority of New South Wales [2006] HCA 27; (2006) 226 CLR 256
Cardile v LED Builders Pty Ltd [1999] HCA 18; (1999) 198 CLR 380
Easterday v The Queen [2003] WASCA 69; (2003) 143 A Crim R 154
Easterday v The State of Western Australia [2005] WASCA 105; (2005) 30 WAR 122
Easterday v The State of Western Australia [2005] WASCA 202
Graham v Sutton, Carden & Co [1897] 2 Ch 367
Hammond Suddard Solicitors v Agrichem International Holdings Ltd [2001] EWCA Civ 2065
Norilya Minerals Pty Ltd v Easterday [2009] WASC 191
Norilya Minerals Pty Ltd v Ireland [2008] WASC 53
Norilya Minerals Pty Ltd v Ireland [2010] WASC 260
Phillip Morris Ltd v Attorney‑General for the State of Victoria (2006) 14 VR 538
R v Carroll [2002] HCA 55; (2002) 213 CLR 635
Re Payne, Randle v Payne (1883) 23 Ch D 288
Re Wickham, Maroney v Taylor (1887) 35 Ch D 272
Vodafone Ltd v GNT Holdings (UK) Ltd [2004] EWCA Civ 1242

JUDGMENT OF THE COURT:

Introduction

On 12 October 2010 the court heard an urgent application for leave to appeal, and to appeal if leave is granted, against the primary judge's decision to refuse to stay proceedings brought by the respondent (the plaintiff in the actions below) against the appellants (the defendants in the actions). It is convenient to refer to the parties by reference to their position in the court below. The primary judge's decision is Norilya Minerals Pty Ltd v Ireland [2010] WASC 260.
The trial of the plaintiff's action against the defendants was due to commence on 11 October 2010 and had been listed for 70 days. The commencement of the trial has since been adjourned to 25 October 2010.
About a month prior to the trial commencing, the defendants applied to the primary judge for the actions to be stayed unless and until the plaintiff paid the amounts due to the defendants pursuant to the orders of the Court of Criminal Appeal referred to below, or alternatively stayed unless and until the plaintiff filed an affidavit disclosing that it had sufficient assets from which to pay such amounts. The primary judge refused that application and it was that decision which was under challenge and which the court heard on 12 October 2010.
At the end of argument that day, the court dismissed the application and said that reasons would be published later. These are the reasons for which we dismissed the application for leave to appeal.

The background

The plaintiff is a company the shares in which were wholly owned by Noranda Group Pty Ltd (a subsidiary of a Canadian company) and Perilya Mines NL (an Australian listed company). The defendants include persons (prospectors) who were the registered holders of certain mining tenements in early 1990. In March 1990, the prospectors were negotiating the sale of the tenements to another entity, Acarus Pty Ltd. The plaintiff at that time also expressed interest in acquiring the tenements. Agreements were subsequently made by which Acarus was given the option to acquire the tenements from the prospectors for $6 million, and that if the option were exercised, the plaintiff would pay the $6 million to the prospectors in consideration for it acquiring a 30% interest in Acarus. The plaintiff also obtained the right to acquire a further 20% interest in Acarus upon payment of a further $4 million to Acarus.
Following positive drilling results in June 1990, Acarus exercised the option to acquire the tenements and the plaintiff paid the purchase price of $6 million. The plaintiff borrowed the funds from Noranda Pty Ltd, a subsidiary of Noranda Group Pty Ltd. The prospectors paid part of the purchase moneys to or on behalf of the other defendants.
After the option was exercised, further drilling was carried out, as a result of which it appeared that there was no gold mineralisation of any significance on the tenements. Acarus suspected that the tenements had been 'salted' and complained to the police.
On 15 August 1990, the plaintiff commenced proceedings CIV 2232 of 1990 against the prospectors and claimed damages for alleged fraudulent misrepresentation and misleading and deceptive conduct. The plaintiff also obtained, in effect, a freezing order of the then defendants' assets.
Nearly three years later, on 28 July 1993, the prospectors were found guilty in criminal proceedings in the District Court on one count of conspiracy to defraud and on 10 counts of false pretences in relation to the sale of the tenements. The trial judge ordered the prospectors and additional defendants to make restitution, in effect, of the moneys paid by the plaintiff to the prospectors. The prospectors appealed their convictions, but the appeal failed. On 6 May 1994, the plaintiff enforced the restitution orders made by the trial judge (which were subsequently amended to some extent in the Court of Criminal Appeal) and received approximately $5.8 million from the prospectors and the additional defendants. Also, on 18 August 1994, in reliance on the convictions, the plaintiff obtained summary judgment, with damages to be assessed, against the prospectors and the other then defendants in CIV 2232 of 1990.
Nearly nine years after that, following the grant of leave by the Attorney General, the prospectors again appealed their convictions. They succeeded this time and their original convictions were overturned on 28 March 2003: see Easterday v The Queen [2003] WASCA 69; (2003) 143 A Crim R 154.
On 4 March 2005, the Court of Criminal Appeal declared that the original restitution orders were null and void and held that the court had a discretionary power under the powers 'imported' under the then s 697 of the Criminal Code (WA), to order repayment, with interest, of the sums paid under the original restitution orders: see Easterday v The State of Western Australia [2005] WASCA 105; (2005) 30 WAR 122 [31] ‑ [35].
On 28 October 2005, the Court of Criminal Appeal held that the plaintiff should repay the relevant sums, and refused an application by the plaintiff for a stay of the orders for repayment, pending the resolution of its claims in CIV 2232 of 1990: see Easterday v The State of Western Australia [2005] WASCA 202. Formal orders were made for repayment on 8 February 2006. The plaintiff also consented to the summary judgment it had obtained against the prospectors and the other defendants being set aside.
The plaintiff did not pay any part of the sums ordered to be repaid by the Court of Criminal Appeal. It is impecunious. There is no suggestion that in the intervening years between the plaintiff recovering the money pursuant to its enforcement of the original restitution orders in 1994, and the orders of the Court of Criminal Appeal in 2005 declaring such orders null and void and requiring the plaintiff to repay the sums it had received, that the plaintiff had applied the monies other than in the ordinary course of business. Indeed the primary judge, in an earlier application, found that the plaintiff had repaid the money to its creditor: Norilya Minerals Pty Ltd v Easterday [2009] WASC 191 [14] (this decision is referred to further below).
On 16 October 2007, some of the defendants served on the plaintiff a statutory demand with a view to winding‑up the plaintiff for non‑payment of the money ordered to be repaid by the Court of Criminal Appeal. Master Sanderson, on 17 April 2008, set aside those statutory demands: Norilya Minerals Pty Ltd v Ireland [2008] WASC 53. There was no appeal against that decision, and its correctness was not challenged in this appeal.
In the meantime, on 21 December 2007, the plaintiff commenced new proceedings, CIV 2364 of 2007, which his Honour described in the following terms at [22] ‑ [24] of his reasons. His Honour said, relevantly for present purposes, that the plaintiff sought:
1.declarations that for the period of time [the defendants] held funds, or property derived from the funds, of [the plaintiff] that were paid to the defendants, those funds or property were held on trust for [the plaintiff];
2.declarations that any sums repaid by [the plaintiff] to any of these parties pursuant to the repayment order made on 8 February 2006 are to be held on trust for [the plaintiff];
3.declarations that [the plaintiff] is entitled to retain the monies it received pursuant to the restitution orders made by the District Court by way of restitution for the total failure of consideration in respect of the payment of the purchase price for the tenements.
4.declarations that [the plaintiff] is entitled to an equitable set-off in respect of its liabilities to the parties who have issued the statutory demands to such an extent that it has no liability to make any payments to them.
[The plaintiff] also says that the defendants, in the event that any sums are repaid to them by [the plaintiff], would be receiving those funds with knowledge that the funds were procured from [the plaintiff] by means of fraudulent representations by the Prospectors and with knowledge that [the plaintiff] is and will remain the beneficial owner of the funds.
[The plaintiff] says that CIV 2364 of 2007 became necessary because the original constructive trust that arose as the result of the transfer of funds from the Prospectors to the additional defendants was extinguished when the funds were repaid to [the plaintiff] in accordance with the orders made on 30 July 1993 and amended on 20 August 1993. [The plaintiff's] case is that a new constructive trust will arise on repayment of the funds by [the plaintiff] [22] ‑ [24].
On 28 July 2009 the primary judge published reasons dealing with a number of procedural issues: Norilya v Easterday [2009] WASC 191. Proceedings CIV 2364 of 2007 and CIV 2232 of 1990 were ordered by his Honour to be consolidated. The judge dismissed an application by the defendants, in effect, to stay the plaintiff's actions on the basis that the plaintiff was in contempt of the Court of Criminal Appeal's orders. His Honour held that, given the plaintiff's impecuniousity, it had not been established that the plaintiff was in contempt of court and further, that the alleged contempt had occurred in different proceedings: Norilya v Easterday [2009] WASC 191 [34] ‑ [35]. His Honour also said that, as a matter of discretion, the plaintiff should not in any event be deprived of an opportunity to pursue its rights, because it had an alleged entitlement to receive from the defendants similar amounts to those which it was required to repay to the defendants: Norilya v Easterday [2009] WASC 191 [36].
His Honour, also on 28 July 2009, declined an application by the defendants to stay the actions on the ground that they were an abuse of process. His Honour said, in the same reasons for judgment, that:
The defendants say that the actions are an abuse of process issued and maintained to avoid the consequences of the CCA orders. The defendants submit that if the plaintiff cannot or will not comply with the CCA orders it should not be permitted to continue these proceedings because to permit otherwise is to allow the court process to be abused.
The plaintiff is not using the actions for an improper purpose. The plaintiff is using the actions to establish and pursue the legal rights which it asserts in the actions. The effect of the plaintiff prosecuting the actions is not unjustifiably oppressive to the defendants. The plaintiff asserts it has certain rights. The defendants deny that is so. The plaintiff is using the actions to pursue those claimed rights. The actions will not bring the administration of justice into disrepute. The CCA ordered the plaintiff to repay the amounts it received under the restitution orders. The court has not determined the rights sought to be litigated in the actions. It does not bring the court into disrepute to allow the plaintiff to do so. The plaintiff has not paid the amounts it has been ordered to pay under the CCA orders because it cannot do so. It does not bring the court into disrepute for the court's procedures to be used to determine the legal rights of the parties in circumstances where one party has not complied with an order of the Court of Appeal in other proceedings because it is unable to do so [38] ‑ [39].
There was no appeal against that decision.
The ultimate holding company of the plaintiff is Xstrata Plc, an international mining company. To date, the Xstrata group of companies has provided funds from time to time to the plaintiff to enable it to prosecute the proceedings, including the provision of funds to meet orders for security for costs made in the proceedings. However, there is no agreement between Xstrata and the plaintiff which requires Xstrata to fund the litigation or to provide the plaintiff with sufficient funds to comply with any order of the court to make any payment. The plaintiff's capacity to make a payment is dependent upon whether Xstrata is willing to advance the necessary funds to the plaintiff: see Norilya v Ireland [2010] WASC 260 [30].

The nature of the primary judge's decision, and the need for leave to appeal

In R v Carroll [2002] HCA 55; (2002) 213 CLR 635 [73] Gaudron and Gummow JJ said:
The power to stay is said to be discretionary. In this context, the word 'discretionary' indicates that, although there are some clear categories, the circumstances in which proceedings will constitute an abuse of process cannot be exhaustively defined and, in some cases, minds may differ as to whether they do constitute an abuse. It does not indicate that there is a discretion to refuse a stay if proceedings are an abuse of process or to grant one if they are not. However, as with discretionary decisions, properly so called, appellate review of its exercise looks to whether the primary judge acted upon a wrong principle, was guided or affected by extraneous or irrelevant matters, mistook the facts, or failed to take into account some material consideration. If so, the appellate court may reach its own decision in substitution for that of the primary judge, where there are before it the materials for so doing.
See also Batistatos v Roads and Traffic Authority of New South Wales [2006] HCA 27; (2006) 226 CLR 256 [7].
The primary judge is the CMC List case manager of the proceedings. The decision challenged is an interlocutory decision on practice and procedure, as to which see Seaman, Civil Procedure Western Australia (vol 2) [3925.55].
Also, as it is an interlocutory decision, leave to appeal is required: s 60(1)(f) of the Supreme Court Act 1935 (WA). In Allmark v Mossensons (a firm) [2006] WASCA 127, Pullin JA (Buss JA agreeing) said [26]:
Leave will usually only be granted where the decision below was wrong, or at least attended with sufficient doubt to justify the granting of leave, and if in addition substantial injustice would be done by leaving the decision unreversed. See Wing Luck Foods v Lay Choo Lim [1989] WAR 358 at 360 and Friday v Australian National Airlines Commission, unreported; FCt SCt of WA; Library No 8502; 24 September 1990; Stanley v Layne Christensen [2006] WASCA 56 at [15] and [58]. These are not rules but guidelines. The Court has a residual discretion to do justice in any case requiring leave even if the guidelines are not satisfied. See Sanderson v Metropolitan (Perth) Passenger Transport Trust, unreported; FCt SCt of WA; Library No 950185; 22 March 1995.

The appellant's contentions and the proposed grounds of appeal

The proposed grounds of appeal are in these terms:
1.(a) The learned primary judge erred in law in that he held that it was not an abuse of the Court's processes for the respondent to maintain Supreme Court actions CIV 2232 of 1990 and CIV 2364 of 2007 against the appellants.
(b)The learned primary judge should have held that it was an abuse of the Court's processes for the respondent to maintain Supreme Court actions CIV 2232 of 1990 and CIV 2364 of 2007 against the appellants:
(i)unless and until the respondent paid into Court the amount due from it to the appellants pursuant to the judgments of the Court of Criminal Appeal dated 28 October 2005, 8 February 2006 and 14 November 2008 (the 'CCA Orders');
(ii)alternatively, unless and until the respondent filed an affidavit disclosing that it had sufficient assets from which to pay the amount due to the appellants pursuant to the CCA Orders.
Particulars
The learned primary judge should have held that it was an abuse of the Court's processes for the respondent to maintain Supreme Court actions CIV 2232 of 1990 and CIV 2364 of 2007 in circumstances where:
(1)the appellants will practically never be able to enforce the CCA orders if they succeed at trial, as the respondent has no funds;
(2)the CCA Orders were substantive, and not procedural;
(3)in Easterday v WA [2005] WASCA 202 at [16], the Court of Criminal Appeal specifically identified that it would be significantly prejudicial to the appellants if the respondent did not comply with its orders, and expressly refused to stay its orders on that basis;
(4)the effect of allowing the respondent to pursue Supreme Court actions CIV 2232 of 1990 and CIV 2364 of 2007 is, in effect, to allow the respondent a de facto stay, contrary to the express decision of the Court of Criminal Appeal;
(5)the judgment of this Honourable Court in Norilya Minerals Pty Ltd v Ireland [2008] WASC 53 has prevented the appellants from pursuing the only available means of practically enforcing the CCA orders; and
(6)the appellants will be subjected to significant prejudice as a result of the CCA Orders having been rendered practically useless, in that:
(a)the appellants will have funded that litigation without access to funds which they should have been paid, which was a matter expressly of concern to the Court of Criminal Appeal (Easterday v Western Australia [2005] WASCA 202 at [16]); and
(b)the appellants will be subjected to lengthy litigation by a plaintiff which has no ordinary incentive to settle the litigation because, whether it wins or loses, it will not end up having to pay any amount to the appellants.
2.The learned primary judge erred in law in holding that it was not an abuse of the Court's processes for the respondent to maintain Supreme Court actions CIV 2232 of 1990 and CIV 2364 of 2007 against the appellants because:
(a)there is no reason in principle why the appellants should obtain security for amounts due to them under the CCA Orders if the court would not make orders to give them security for any judgment that might result in Supreme Court actions CIV 2232 of 1990 and CIV 2364 of 2007;
(b)to give security for judgment in these actions would be contrary to the principles in Jackson v Stirling Industries Ltd (1987) 162 CLR 612;
(c)in any event, a stay subject to the alternative condition (referred to in ground 1(b)(ii) above) was not considered by the primary judge and would not have been contrary to any principle stated in Jackson v Stirling Industries Ltd (1987)162 CLR 612.

The defendants, in effect, summarised ground 1(b) for the purposes of this application for leave as follows: there is an abuse of process in that the plaintiff, in pursuing the actions against the defendants, whilst not complying with the monetary orders of the Court of Criminal Appeal, is thwarting the intention of the Court of Criminal Appeal, and is thereby using the court's procedures in a way which is manifestly unfair or so as to bring the administration of justice into disrepute.
In relation to proposed grounds 1(a) and 2, the defendants referred to four matters identified by the judge in [59], [61], [71] ‑ [72] of the judge's reasons, as to why he said there was no abuse of process. In respect of the first three, the defendants' position in this application (written submissions pars 53 ‑ 60) was not that the judge ought to have held from a consideration of those matters that there was an abuse of process. Rather, the complaint was, in substance, that they did not address the burden of ground 1(b). The defendants accepted that if they do not succeed on ground 1(b), these points in themselves could not lead to success in the application for leave to appeal, and it is unnecessary to consider them further.
As to the fourth of those matters, the judge expressed it in these terms:
The essence of the defendants' claim is that [the plaintiff] should provide security for judgment so that if the defendants are successful they will be able to recover the amounts due to them under the CCA orders [72].
The defendants contend in effect that the judge erroneously characterised their application below as an application to provide security for judgment. The plaintiff contends, in effect, that the judge was merely dealing with this aspect of the defendants' application in the way in which it had been advanced by the defendants before his Honour. Again, it is unnecessary to resolve this dispute as the defendants accept that the success of their application for leave turns on the soundness of ground 1(b).
Finally, we would note here that the proposition advanced by the defendants (see [23] above), does not seem to have been put in those terms to the primary judge. That is an aspect of a number of unusual features of the present application. It was left until the eleventh hour. The defendants' earlier application in 2009, which also sought a stay on the basis of abuse of process on essentially the same grounds, could equally have encompassed the particular points made to the primary judge in the present application, but did not do so. In relation to the latter part of the defendant's proposition, the primary judge, in the defendants' 2009 application to stay the proceedings found, in terms, that the administration of justice is not being brought into disrepute: Norilya v Easterday [2009] WASC 191 [39], quoted above. As noted earlier, there was no appeal against that decision. The defendants have since then allowed the litigation to proceed and the parties have continued to prepare their cases for a trial. The point has been reached where the trial is now imminent. Indeed, the defendants have participated in the litigation for over three years since the Court of Criminal Appeal delivered the decision from which the defendants say it is evident that the intention was that the plaintiff should not pursue the civil proceedings without first complying with the Court of Criminal Appeal's restitution orders.

Abuse of process - principles

There is no dispute about the relevant principles. The primary judge in his reasons (Norilya v Ireland [2010] WASC 260 [54]) said:
In Jeffery & Katauskas v SST Consulting [2009] HCA 43; (2009) 239 CLR 75 French CJ, Gummow, Hayne & Crennan JJ said (omitting reference to authority):
'… the contemporary approach in the United Kingdom and Australia which takes no narrow view of what can constitute "abuse of process".
Nevertheless, certain categories of conduct attracting the intervention of the courts emerged in the nineteenth and twentieth centuries and included:
"(a)proceedings which involve a deception on the court, or are fictitious or constitute a mere sham;
(b)proceedings where the process of the court is not being fairly or honestly used but is employed for some ulterior or improper purpose or in an improper way;
(c)proceedings which are manifestly groundless or without foundation or which serve no useful purpose;
(d)multiple or successive proceedings which cause or are likely to cause improper vexation or oppression."
The term "abuse of process", as used in Australia today, is not limited by the categories mentioned above or those which constitute the tort. It has been said repeatedly in the judgments of this Court that the categories of abuse of process are not closed. In Walton v Gardiner (1993) 177 CLR 378 at 393 the majority adopted the observation in Hunter v Chief Constable of the West Midlands Police [1982] AC 529 at 536 that courts have an inherent power to prevent misuse of their procedures in a way which, although not inconsistent with the literal application of procedural rules of court, would nevertheless be "manifestly unfair to a party to litigation … or would otherwise bring the administration of justice into disrepute among right-thinking people". This does not mean that abuse of process is a term at large or without meaning. Nor does it mean that any conduct of a party or non‑party in relation to judicial proceedings is an abuse of process if it can be characterised as in some sense unfair to a party. It is clear, however, that abuse of process extends to proceedings that are "seriously and unfairly burdensome, prejudicial or damaging" or "productive of serious and unjustified trouble and harassment" (93 ‑ 94).'
The defendants also referred to Batistatos v Roads and Traffic Authority of NSW [9], [13].

Disposition of the appeal

In considering the defendants' submissions on abuse, it is convenient to record at the outset the following:
(a)It is not contended that the plaintiff is in contempt of court;
(b)It is not contended that the plaintiff's actions in CIV 2232 of 1990 and CIV 2364 of 2007 lack utility or serve an illegitimate or improper purpose;
(c)It is not contended that the plaintiff has no arguable claim in CIV 2364 of 2007 for a declaration that it is entitled, in equity, to set‑off the monetary order of the Court of Criminal Appeal against its claims against the defendants; the defendants expressly accept that the plaintiff's claims arguably impeach the title of the defendants to enforce the order of the Court of Criminal Appeal. As to equitable set‑off and the necessity for impeachment of title in equitable set‑off, see Meagher RP, Heydon JD & Leeming MJ, Meagher, Gummow and Lehane's Equity: Doctrines & Remedies (4th ed, 2002) [37‑045], [37‑055], [37‑085];
(d)It is not contended that there was any error in the earlier decision to set aside the statutory demand which had been served on the plaintiff on the basis of a failure to comply with the Court of Criminal Appeal's orders;
(e)It is not contended that, because they have not received repayment of the money, the defendants are unable to fund the defence of the civil claims against them.
(f)Further, '[t]his is not a case where a third party is funding the plaintiff's action in circumstances where the plaintiff will not be able to pay the defendant's costs if the defendant is successful in the action. ... [The plaintiff] has obtained funds to provide security for the defendants' costs if the defendants are successful in the action': (primary judge's reasons [72]).
The gravamen of the defendants' contention in this application (as it ultimately emerged from the defendants' written submissions in reply and in oral argument) is, in effect, that there is an abuse because the Court of Criminal Appeal intended that the plaintiff should not pursue its civil claims unless it first repaid to the defendants the monies which it had recovered under the original restitution orders some 12 years earlier.
It is accepted by the defendants that the Court of Criminal Appeal's orders made no express provision to that effect. It is also accepted by the defendants that, on their proper construction, the Court of Criminal Appeal's orders did not, in effect, provide for a stay of the plaintiff's claims in the event that the plaintiff did not repay the sums ordered. Nor did the defendants contend that some issue estoppel or res judicata arises from the Court of Criminal Appeal's decision whereby the plaintiff is precluded from contending that its claims against the defendants give rise to an equitable set‑off against the orders for repayment. The intention for which the defendants contend in relation to ground 1(b) is of a non‑binding nature, albeit one which, if ignored, is said to constitute an abuse of process.
The defendants say that the Court of Criminal Appeal's reasons disclose the intention to which they refer, and they refer to Easterday [2005] WASCA 202 [16]. It is necessary to consider that contention.
It is clear from the reasons of the Court of Criminal Appeal that the court acted on the principle that the defendants were entitled to orders for restitution. It was in that context that the Court of Criminal Appeal considered the plaintiff's submission for a stay. Steytler J recorded that the plaintiff's submission was that if the court should stay execution of the restitution orders for repayment, the parties would, in effect, be restored to the position which existed prior to the prospectors' convictions and the consequential making of the original restitution orders by the District Court [11]. His Honour noted that 'no other basis [had] been put forward to support the imposition of a stay' [16]. Steytler J (with whom the other members of the court agreed) held, in effect [12] ‑ [16], that the imposition of a stay by the court would not put the parties back into the position that they occupied prior to the making of the original restitution orders in the District Court, and declined the application for a stay for that reason. His Honour was not addressing his attention to the proposition, nor expressing an intention, that the plaintiff should be barred from pursuing its civil claims unless it first repaid to the defendants the monies which it had recovered under the original restitution orders.
It is to be noted that when the Court of Criminal Appeal declined to stay the orders on the basis then advanced by the plaintiff, it was known that the plaintiff was probably impecunious. Steytler J, in dealing with the question of the payment of interest on the principal sums, referred to the likelihood of the plaintiff being able to pay as 'academic': Easterday [2005] WASCA 202 [19] ‑ [20]. (The point was also reflected in a transcript from the hearing of the matter before the Court of Criminal Appeal to which we were referred in this application.) In other passages, Steytler J spoke in terms which anticipated the continuation of the plaintiff's civil claims against the defendants: Easterday [2005] WASCA 202 [8], [11], [18] ‑ [21].
In the view of this court, having regard to the above matters, the defendants have not established that it is appropriate to impute an intention to the Court of Criminal Appeal that it required the plaintiff to repay the defendants before the plaintiff proceeded with its civil claims.
Further, in light of the way the defendants put their case below and in this application (see [29] ‑ [31] above), we are not satisfied that an intention of the kind postulated, which did not bind the parties, would be a basis for finding an abuse of process. The defendants contend that the abuse may be seen by analogy with cases in which it has been held that in particular circumstances, it is an abuse:
(a)to allow a person to pursue litigation without paying a previous judgment or order; and
(b)to allow a person to take steps which will render a judgment or order practically useless or unenforceable.
As to the first basis for the suggested analogy, the defendants placed particular reliance on Re Wickham, Maroney v Taylor (1887) 35 Ch D 272; Re Payne, Randle v Payne (1883) 23 Ch D 288 and Graham v Sutton, Carden & Co [1897] 2 Ch 367. The defendants also referred to certain recent English authorities: Hammond Suddard Solicitors v Agrichem International Holdings Ltd [2001] EWCA Civ 2065 [41] ‑ [42] and Vodafone Ltd v GNT Holdings (UK) Ltd [2004] EWCA Civ 1242.
A convenient summary of many of the older authorities in this area may be found in Daniell's Chancery Practice (1914, 8th ed, vol II) (1640 ‑ 1641).
In Phillip Morris Ltd v Attorney‑General for the State of Victoria (2006) 14 VR 538, [122] ‑ [151], Ormiston JA examined a number of the authorities with reference to the distinction which appeared in cases dealing with unpaid costs on interlocutory applications on the one hand, and unpaid costs of an earlier action with the same or substantially the same parties as the subject matter in a later action, on the other. His Honour observed that by the end of the 19th century the rules regarding a stay in the latter type of cases appeared to be stated in 'almost, dogmatic unqualified terms' [133], although his Honour ultimately said that he would prefer to view the authorities as a whole 'as permitting an understanding of the rule as requiring only the exercise of a discretion, being a discretion to prevent vexatious proceedings or otherwise to control abuse of process' [149].
Re Payne, Randle v Payne, to which the defendants referred, was a case where an action by a married woman by a next friend was dismissed for non compliance with an order for security for costs. A second action by her by another next friend against the same defendants, for the same cause, was stayed until the costs of the first action were paid.
Re Wickham, Maroney v Taylor involved a stay of proceedings in which the plaintiff alleged breaches of trust by the defendant. The plaintiff applied, by motion before trial, for the appointment of a receiver. The application was dismissed, with costs, on the grounds which involved 'the conclusion by the Court that no case of breach of trust ... had been established against the Defendant' (280). The plaintiff failed to pay the costs of the motion and the defendant successfully applied to stay the hearing of the trial until payment of the costs of the motion. Lindley LJ said 'whenever it can be shewn that a person is proceeding vexatiously and not paying costs which he has been ordered to pay, the Court has jurisdiction to stay the proceedings' (282).
In Graham v Sutton, Carden & Co the court stayed proceedings for the plaintiff's failure to pay a costs order from an appeal in an earlier interlocutory application, in circumstances where the court dealing with the appeal from the earlier interlocutory application had found that the plaintiff had acted vexatiously and oppressively. The Court of Appeal held that the mere non‑payment of the costs of an interlocutory application which the plaintiff has been ordered to pay, and an inability to pay, furnished no sufficient ground for staying the proceedings, however the court may order a stay if the action is vexatious, or has been vexatiously conducted. The court ordered a stay on the latter basis.
These cases do not seem to provide an analogy with the plaintiff's pursuit of its claims in this matter. There was no vexatious conduct by the plaintiff which led to the making of the restitution orders by the Court of Criminal Appeal, and the civil claims being pursued by the plaintiff have not been the subject of previous determination or disposition.
The more recent English decisions referred to by the defendants (see [37] above) also in our view do not assist the defendants. They concern the construction and application of certain provisions of the English rules of court, and the factual circumstances with which those cases deal, provide no real assistance by analogy to this matter.
The second line of authority which the defendants seek to invoke by analogy is that which deals with the power of the court to preserve the efficacy of the execution which would lie against an actual or prospective judgment debtor: Cardile v LED Builders Pty Ltd [1999] HCA 18; (1999) 198 CLR 380, 393 [25]. The defendants contend, in this regard, that the plaintiff's continuation of the actions renders the Court of Criminal Appeal's orders practically useless, and that the defendants are thereby significantly prejudiced.
Although the plaintiff submitted that this argument was not run in the court below, this was disputed by the defendants and this court accepts that the primary judge has recorded the substance of the point at [44] ‑[45] of his Honour's reasons. The point apparently being made is that if the plaintiff fails in its action, the plaintiff will have no assets against which the Court of Criminal Appeal's orders can usefully be enforced.
It appears to us that any inability of the defendants to recover the monies the subject of the Court of Criminal Appeal's orders derives from the plaintiff's impecuniousity, rather than from the continuation of the proceedings. If the plaintiff fails at trial, it will have failed in establishing its claim to an equitable set‑off (the existence of which is acknowledged presently to be arguable). The Court of Criminal Appeal's orders could not then be resisted (putting aside any issues arising from an appeal) in any further winding‑up procedure, but the plaintiff's incapacity to pay will then (on the current evidence) still be the same as it is now. The defendants may be worse off if and to the extent that they are out of pocket in relation to any difference between taxed costs and secured costs, after having recourse to their security for costs (see also [49] ‑ [51] below). Nevertheless the practical disability in recovering repayment under the Court of Criminal Appeal's orders will be the same.
For these reasons, in our view, the defendants have not established that the primary judge's decision is attended with sufficient doubt to justify the granting of leave to appeal.
In relation to the question of whether substantial injustice would be done by leaving the decision unreversed, the defendants mention two further sources of prejudice, which in their supplementary written submissions they refer to as 'less significant, prejudices'. First, they say they will have been subjected to large scale litigation, by a plaintiff which has no ordinary incentive to settle the litigation because, whether it wins or loses, it will not end up having to pay any amount to the defendants. Secondly, they say the defendants will have funded that litigation without access to funds which they should have been paid - a matter, which they say, was of express concern to the Court of Criminal Appeal: Easterday [2005] WASCA 202 [16]. They also say in this regard that security for costs is only available after the litigation is concluded, and that they will incur the costs before then.
As to the first matter, we accept that there is some force in the point, although it is overstating it, in our view, to say that the plaintiff has no ordinary incentive to settle the litigation. It still has to fund the litigation and fund security for costs for the defendants for and in advance of a lengthy trial. The usual factors such as inconvenience, stress, time spent managing the litigation, and the general uncertainty of legal proceedings also apply.
As to the second matter, it is difficult to assess the magnitude of the prejudice asserted without evidence of the billing arrangements, the rates being charged, and the likely extent to which the defendants will be out of pocket after taking into account the amount of security provided. It is of some significance that it is accepted that the costs will not be so burdensome that the defendants will in effect be financially shut out from defending the claims.

Further, it is also relevant, we think, to have regard to the conduct of the defendants referred to in [27] above, which raises broader considerations of the administration of justice.
On balance we are not satisfied that there is a substantial injustice such as to warrant the grant of leave.