Madritsch Kg v Thales Australia Limited

The parties to the proceeding Madritsch Kg v Thales Australia Limited are Madritsch KG and Nioa Nominees Pty Ltd, who are the plaintiffs, and Thales Australia Limited, who is the defendant. The proceeding involves a claim for damages for breach of contract, compensation for contravention of s 18 of the Australian Consumer Law (ACL), and equitable compensation for breach of a duty of confidence or alternatively an account of profits. The claim relates to the manufacture of a firearm sold to the Commonwealth for use by the Australian Defence Force. The defendant has appealed the decision on liability, and has applied for an adjournment of the question of the quantification of loss and damage or any enquiry into an account of profits until after the determination of the appeal.

The central legal issue the court had to decide was whether the possible costs disadvantage the defendant may endure outweighs the certain further delay in the determination of the plaintiffs’ claim. The defendant argued that it would incur considerable costs absent a grant of the relief sought, and the plaintiffs sought to progress their claim to final judgment without delay. The court had to weigh the considerations of granting an adjournment against the principles of finality and the entitlement of the successful party in litigation to the fruits of their judgment.

The court found that the application was in substance for an order barring the progress of the proceeding in the trial division towards a trial, including preventing further disclosure, exchange of witnesses’ summaries, and orders for expert reports, pending the outcome of the appeal. The court rejected the application, holding that an order that imposes a halt on a proceeding is a stay in nature and effect, if not in name. The court held that the nomenclature was of less importance than the substance and that the considerations that judgments of the Trial Division should not be treated as merely provisional, and that a successful party in litigation is entitled to the fruits of its judgment, outweighed the possible costs disadvantage to the defendant. The court held that the application did not arise in the situation the subject of the decisions in Cook's Construction Pty Ltd v Stork Food Systems Australasia Pty Ltd, Croney v Nand, and Day v Humphrey, which concerned the prevention of an order that might be made by the appellate court being rendered nugatory. The court held that no such issue arose here and that there was no order that needed to be stayed because it might be enforced before the appeal was determined.

The final orders of the court were that the parties were to confer and submit to the Associate to Bradley J either any agreed or any competing directions proposed for the next stage of the proceeding by 4:00 pm on 21 October 2021, the application filed 7 September 2021 was dismissed, and costs were reserved to be agreed or, if necessary, determined at a time convenient to the court.