Janus, W.C.C.M v A.G.C. (Advances) Ltd

[1988] FCA 598

JUDGMENT No. . . 598 ........ ....... fl. B-

IN THE FEDERAL COURT OF AUSTRALIA 1

QUEENSLAND DISTRICT REGISTRY 1 QLD G96 of 1987

GENERAL DIVISION )

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BETWEEN:  WALTER CORNEILLE CLEMENT KARIE JANUS

First Applicant

AND :  WINJAN PASTORAL CO13PANY PTY LTD

Second Applicant

AND :  TWEED CANAL ESTATES PTY LTD

Third Applicant

AND :  WINGARA ENTERPRISES PTY LTD

Fourth Applicant

AND :  A.G.C. (ADVANCES) LIMITED

First Respondent

AND :  MACDONALD WAGNER PTY LTD

Second Respondent

AND :  A.G.C. (ADVANCES) LIMITED

Cross-Claimant

AND :  WALTER CORNEILLE CLEMENT IWRIE JANUS

First Cross-Respondent

AND :  WINJAN PASTORAL COMPANY PTY LTD

Second Cross-Respondent

AND :  TWEED CANAL ESTATES PTY LTD

Third Cross-Respondent

AND :  WINGARA ENTERPRISES PTY LTD

Fourth Cross-Respondent

AND:  ANGELA JANUS

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IN THE FEDERAL COURT OF AUSTRALIA	1
QUEENSLAND DISTRICT REGISTRY	) QLD G96 of 1987
GENERAL DIVISION	1

BETWEEN:  WALTER CORNEILLE CLEMENT IWRIE JANUS

First Applicant

AND :  WINJAN PASTORAL COMPANY PTY LTD

Second Applicant

AND :  TWEED CANAL ESTATES PTY LTD

Third Applicant

AND :  WINGARA ENTERPRISES PTY LTD

Fourth Applicant

AND :  A.G.C. (ADVANCES) LIMITED

First Respondent

AND :  MACDONALD WAGNER PTY LTD

Second Respondent

AND :  A.G.C. (ADVANCES) LIMITED

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Cross-Claimant ! '

AND :  WALTER CORNEILLE CLEMENT MARIE JANUS

First Cross-Respondent

AND :	WINJAN PASTORAL COMPANY PTY LTD
Second Cross-Respondent

AND :  TWEED CANAL ESTATES PTY LTD

Third Cross-Respondent

AND :  WINGARA ENTERPRISES PTY LTD

Fourth Cross-Respondent

AND :  ANGELA JANUS

Fifth Cross-Respondent

MINUTES OF ORDER

JUDGE MAKING ORDER:	PINCUS J.
DATE OF ORDER:	7 OCTOBER 1988
WHERE MADE:	BRISBANE
THE COURT -

ORDERS THAT:

1. paragraphs 8, 9, 10, ll(c), ll(d), 12(c), 12(d),

1 4 , 15, 17(c), 19(a), 28, 29, 3 0 , 3 3 be struck out;

2.    paragraph 3 4 be treated as an assertion that in

breach of contract the matters set out in the

particulars at p.22 and p.23 occurred;

DIRECTS THAT:

3 . as to paragraph 3 4 the respondents may treat the

allegations in (a) to (e) on p.21 as not having

been made;

4 . no amendment whatever be made to the pleadlng

without the draft being first submitted to	Mr
Justlce Pincus.

NOTE :  Settlement and entry of orders is dealt with in

- Order 3 6 of the Federal Court Rules.

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PINCUS J. 7 OCTOBER 1988

EX TEMPORE REASONS FOR JUDGMENT

In this matter the order of the Court made when the

matter was last before me contemplated that the applicants would

produce a draft statement of claim. In fact, that did not occur.

A statement of claim was filed on 4 October and the point was

taken for the respondents that they should not be disadvantaged by

that having occurred. It does not seem to me that there is any

real prejudice to them because I will treat the propriety of the

statement of claim as in issue and I have heard argument as to its

propriety on the basls that the applicants are seeking to have it

substituted for the existing pleading.

The case as sought to be put forward 1s in rather an

unusual situation in that evidence has already been filed; the

counsel for the applicants, Mr Stephens, as I understood him

during the course of the arguments, said he hoped that the

evidence would, in some respects, be improved before or at the

hearing. Nevertheless, the substance of the applicants' case at

least, 1 s on affidavit, if not the whole of it; as is usual in a
trial on affidavit, it is for the applicants to seek leave to call

any further evldence they wlsh to adduce.

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In the circumstances I have mentioned, namely, that at

least the substance if not the whole of the case is on affidavit,

one might have expected that the statement of claim would be

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fairly precise, but it is not.

It seeks to make out caus es of action i n contract, in

negligence, and under s.52 of the Trade Practices Act 1974 and also on other bases. Speaking generally, the allegations against the first respondent are of misleading statements and negligence

as a financier, and against the second respondent on misleading

statements and negligence as a consulting engineer. The attitude

whlch I have taken is that it is important that the statement of

claim set out the case precisely, because otherwise experience

suggests that, not only the respondents, but also the Court	is
disadvantaged.	I have on a number of occasions endeavoured to

achieve the result that the applicants' pleading is in proper

order, but so far without success.

The allegation in paragraph 8 of the statement of claim

is that the first respondent led the applicants to belleve certain

things; take, as an example, the first - hat the first respondent

was possessed of certain skill and	~udgment, information and
expertise.

In paragraph 12 of the statement of claim, it is said

that the conduct referred to in 8 was misleading, from which one
might deduce that the statement made as to the skill and judgment,
information, and expertise of the flrst respondent was misleading,

but nowhere does one find in what respect it was misleading.

Presumably (as a matter,	I suppose, of necessary inference) the
case sought to be set up is that the first respondent is	not - or

was not at the relevant time - a skilful financier. An

examination of that rather large question is a matter on which one

would hesitate to enter, but it seems to me unnecessary to do so ,

because the allegation is not followed through by explaining in

what respect these statements mentioned in 8 are untrue or

misleading.

In fact, it is a little worse than that, because what I

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said to be particulars	of paragraph 8 are not particulars of
paragraph 8 at all. They	do not seem to bear any rational
relationship to paragraph 8 and the first respondent is left with	I '
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the position that its general competence and so forth is

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besmirched, but in a very vague way, and I do not think that

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should continue. Pargraph 8 must go. I leave for the moment the ,.

question whether the whole pleading can survive.

Paragraphs 9 and 10 are also not in proper form. Mr

Stephens explained to me, as I understood his address, that the

evidence would beef them up a bit, but after eighteen months, it

is really too late to make that sort of excuse.

Paragraph 9 simply says that a valuation, prepared by

someone else, was presented by the first respondent; it is	not
suggested that anything was said about	it at all by the first

respondent and the bald assertion is made that that is unlawful.

That seems to me to be, on its face, frivolous, and	9 and 10
cannot stand.

Paragraph 11 is another allegation of the applicants

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having been led to believe certain things; much of the attack on	' ,
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11 focused on (c) and (d). Sub-paragraph ( c ) is an allegation

that the applicants were led to believe that the interest rate for

a then proposed loan would be static and would be 17 per cent.

Sub-paragraph (d) says that the repayments would be at a certain

level. These allegations are said, in paragraph	12, to be wrong
in that, to take the first one,	it said that the first respondent

reserved the right to vary the interest rate and did, in fact,

vary it

AS I said during the course of address, this is not a

clearly pleaded case. It is, of course, possible to bring a suit based upon the assertion that a misrepresentation was made as to the contents of a document. It is possible to bring a suit based

on the assertion that there was a misrepresentation as to the

state of one's mind. Precisely	what this allegation is, is left	I
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unclear. It is, in my opinion,	too late to extend any mercy to
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it, and therefore, agaln, paragraphs ll(c), and ( ), and 12(c) and (d) must go, and I add again that I leave for further discussion

the question whether the pleading as a whole can survive.

Then the allegation is made in paragraph 14 that, prior

to making certain documents, the applicants made known to the

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first respondent a purpose for which they required finance, and,

lt is said in paragraph 15, that an implied condition was	b .'
imported. That ties in with paragraph	30, which says that, as I

understand it, the condition was breached, but the allegation in

paragraph 30 is terriby vague. It says that the finance contained

"faults and defects as to principal interest repayments and

timing, rendering it unfit for the said purposes and rendering the

subdivision unprofltable". In answer to that sort of complaint,

it is said, and has been said on previous occasions, well, if the

respondents do not like the pieading, they can ask for

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particulars. I do not accept that that is a proper answer to make

in this situation. For months now complaints have been made about

the vagueness of these sorts of allegations, and no serious

attempt has ever been made to answer then.	So 14, 15, and 30
cannot stand.

Paragraphs 16 and 17 are allegations with which I have

had considerable difficulty. They are plainly very badly drawn,

but are they badly enough drawn to go? Paragraph 16 says that the

second respondent had a conversation in which the costs of

development of the then proposed subdivision, as at a certain

date, were given, and it sets out in a table what the costs were

said to be. Paragraph 17 says that was misleading and deceptive

conduct, and adds	a charge of fraud. The sort of case which	1s
intended to be made can, in a sense, only	be guessed at.	It could

be, for example, that at the time when the allegatlon was made,

that the costs of development would, in fact, have been greater,

and that they should have been estimated at a higher figure.

You look in vain in paragraph 17 for any precise

elucidation of this. The worst aspect of paragraph 17(c) is the

almost contemptuous assertion, and I use that expression

advisedly, that many items of expenditure are omitted, in

particular land costs, preliminary costs, town planning costs, and

other similar items. There is	a responsibility on lawyers not to
act merely as channels for assertions made by their client	or by

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witnesses, but to try to put something sensible before the Court.

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It is in substance admitted that the allegation that land costs	i
were omitted is frivolous, and that is an admission which I was sorry to hear made.

The question really is whether 17(c), which is plainly

an improper - and I use the word "improper" in the strict	sense -
pleading to make, should be omitted, or whether paragraphs	16 and

17 as a whole should be omitted. If 17(c) itself is omitted, then

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that leaves as allegations three specific matters, namely charge

to the Tweed Shire Council being omitted, costs for completion of

site filling being greater than estimated, and contingencies not

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being properly assessed.

Of those three, the one which causes me the greatest

difficulty is the assertion as to the cost of completlon of site

fllling. Again, the way in which the matter should have been	! '
pleaded, if that was the case intended, was to say that the costs

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of completion of site filling reasonably estimated as at 3 April I '

1984 were not	$32,000, but a higher sum, or some other sort	of	i
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case could have been made. What	I would intend to do, however if
the pleadlng as a whole is to stand, would	be to	cut out 17(c),
leaving the rest of it in	a	rather unsatisfactory, but not
impossible, form.

Similar comments apply to 18 and 19, that is, although

if one cuts out 19(a), the pleading is not in a satisfactory form,

but it is not, perhaps, impossible to handle.

Then one comes to allegations of negligence against the

second respondent in paragraphs 28 and 2 9 . Paragraph 28 says

among other things that the second respondent owed a duty of care

in respect of detailed project planning and management,

establishing a project accounting system and matters of that sort.

No facts are pleaded to, supporting this, but one gets a hint as

to what the pleader might have intended from paragraph says that the terms of engagement made the second respondent responsible for detailed project planning and so forth. 3 3 which

This might all be true, but there is a way of pleading

it properly, namely to say that there was a contract and to

identify its contents. What I could do is to allow the applicants	'. ,
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another chance to plead all this properly, but	I do not think I
should, and therefore paragraphs	2 8 , 2 9 , and 3 3 must come out.

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The next doubtful provision is paragraph 3 4 . It starts

off by making all kinds	of assertions which apparently are not
seriously meant; for example, in	(d), failure to let to competent

subcontractors, and I understood from the bar table that there ! >

really 1 s not any case being advanced along that line at all.

The particulars, however, as set out in paragraphs (i)

to (viii), do make some sense, although in some respects they are
deficient (for example, in paragraph (viii) causing or permitting

unspecified delays to the contract works) so that if the case is

to go ahead it will have to do	s , as it seems to me,	so as not to
disadvantage the respondents unreasonably,	on the basis that	3 3

goes out but that 3 4 is treated as an allegation confined to the

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matters	particularized	only,	without	reference	to	the	general	j .:
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allegations in (a) to (e).

Therefore, if the case is to go ahead, to recapitulate,

it goes ahead without	8 , without 9, without 10, without ll(c)	and	i
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(a), without 12(c) and (d), without 1 4 , 15, and 30.	It goes ahead	i
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without 17(c), and without	19(a).	It goes ahead without the

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allegations in paragraphs 28 and 29, and 3 3 and the allegations in

3 4 must be confined to the matters particularized on pp.22 and 23.

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The question then	is: after such surgery, does the pleading	I.
reasonably survive?
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It is evident that there may be parts cut out of it !.

which have substance and which the applicant seriously wants to

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raise, and therefore the case is truncated in a way which is

unsatisfactory. It is also evldent that there may well be

consequential amendments necessary to the pleading as a result of I

the excision of these polnts. In addition, as I have mentioned, i

the	pleading	as	so	truncated	is	still	unsatisfactory	in	a number	l
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of respects.	1
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To pick but one of those, if cut about in that fashion,

the part of 3 4 that is left stands, so to speak, on its own, I.

without any clear explanation to the second respondent as to why

it is that proof of the matters set out	at pp.22 and 23 would make
it liable.

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On the other hand, as to that point, there seems to be

no dispute that, on some basis which is not made clear in the ,

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pleading, the second respondent was engaged	to do engineering work	t.
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and it did some work.	I .
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I feel some sympathy for the respondents and none	at all	b
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for the applicants here.	I think that the work of the Court will	1
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become impossible if cases of complexity are treated	in such a	i

frivolous fashion, without, after a great deal	of exhortation, any	I	l;
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serious attempt to reduce them to commonsense, and to omit from	i ; .
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them windy assertions which are not explained in any commonsense

way.

Nevertheless, one has to think of the clients and it

seems to me that, although I do so reluctantly, I have to let the

case run. The orders will therefore be that paragraphs 8 , 9, 10,

ll(c), ll(d), 12(c), 12(d), 14, 15, 17(c), 19(a), 28, 29, 30, and 33 be struck out. It will be further ordered that paragraph 34 be treated as an assertion that, in breach of contract, the matters

set out in the particulars at pp.22 and 23 occurred. That is, it

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is directed, as to paragraph 34, that the respondents may treat ,

the allegations in (a) to ( e ) on p.21 as not having been made.

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The only other matter, as to the pleading, which	I wish	i.
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to	mention, is that	it may be necessary for the pleading to be	!
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further amended by tidying	up, so to speak, In consequence of the	r *
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excisions. I direct that no amendment whatever be made to the I , I

pleading	without	the	draft	being	submitted	to	me	before	anything	1
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is done to it. I do not want any breach of my order, such as I j

occurred last time, to recur. ? certify that this and the 9 precec'lng , I I .

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pages are a true copy of the reasons for	, .
judgment herein of His Honour	! I ,

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Mr. Justice Pincus S-,8.ed/bJ

' k i a t e	i -,
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Dated 7	October l78g	!
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