McCulloch and McCulloch v Pioneer Concrete (Tasmania) Pty Ltd

[2003] TASSC 48

[2003] TASSC 48

CITATION:McCulloch & McCulloch v Pioneer Concrete (Tasmania) Pty Ltd [2003]     TASSC 48

PARTIES:  McCULLOCH, David John
  McCULLOCH, Phillipa Joy

V
PIONEER CONCRETE (TASMANIA) PTY LTD
(ACN 009 488 322)

TITLE OF COURT:  SUPREME COURT OF TASMANIA
JURISDICTION:  ORIGINAL
FILE NO/S:  505/1999
DELIVERED ON:  2 April 2003
DELIVERED AT:  Hobart
HEARING DATE:  1 April 2003
JUDGMENT OF:  Cox CJ

CATCHWORDS:

Procedure – Supreme Court procedure – Tasmania – Practice under Rules of Court – Amendments – Whether leave to amend defence and amend defence and to add alternate pleas on the second day of civil jury trial – Prejudice – Not compensated by costs.

Queensland v J L Holdings Pty Ltd (1996 - 1997) 189 CLR 146 , referred to.
Murran Investments Pty Ltd v Aromatic Beauty Products Pty Ltd (2002) 191 ALR 579, followed.
Aust Dig Procedure [276]

REPRESENTATION:

Counsel:
           Plaintiff:  R J Phllips, C J Gunson
           Defendant:  G L Sealy, C A Green
Solicitors:
           Plaintiff:  Phillips Taglieri
           Defendant:  Page Seager

Judgment  Number:  [2003] TASSC 48
Number of paragraphs:  10

Serial No 48/2003
File No 505/1999

McCULLOCH & McCULLOCH
v
PIONEER CONCRETE (TASMANIA) PTY LTD

ORAL RULING  COX CJ

2 April 2003

1. The defendant seeks leave to withdraw an admission previously made in its defence and repeated in its amended defence, and to add alternative pleas.

1. The admission is of para 10 of the statement of claim to the effect that the TWU [sic] referred to in cl 27(b) of the agreement said to have been wrongly terminated is the Transport Workers' Union of Australia.  The original defence claimed that the contract was terminated in accordance with cl 27(b), which provides as follows:

"Should the Contractor ignore three (3) written warnings by Pioneer of misconduct in the performance of his duties, Pioneer may, in consultation with the TWU (Tasmania) forthwith by notice in writing to the Contractor terminate this agreement.  A copy of each written warning shall be given to the plant delegate without compensation."

The defendant now seeks not only to withdraw the admission that the entity required to be consulted under that clause is the Transport Workers' Union of Australia, but to plead that the organisation referred to in cl 27(b) is the Transport Workers' Union of Australia (Tasmanian Branch).  Furthermore, it seeks to plead and hopes to establish, even without the need for such a plea, that at the time of termination the Transport Workers' Union (Tasmanian Branch) was dissolved, abolished, disbanded or otherwise ceased to function from 4 July 1998 and that in consequence cl 27(b) was to that extent frustrated.

1. The admission was made as long ago as 1 September 1999 and repeated as late as 25 November 2002 when the amended defence was delivered and it was specifically pleaded in the latter document that on or about 13 May 1999, in consultation with the Transport Workers' Union (Tasmania), the defendant terminated the contract thereby effectively conceding the existence and functioning of such a body.  Furthermore, in answer to a request for particulars, the defendant's solicitors advised on 27 August 2002 that the defendant claimed that the contract was terminated in accordance with cl 27(b) of the contract and that particulars of any consultation that occurred between it and Transport Workers' Union (Tasmania) [sic] were that "the defendant provided a copy of the letter dated 13 May 1999 to the Transport Workers' Union (Tas) by post on 13 May 1999". 

1. With the admission and the particulars, the issue of compliance in respect of this consultative process under cl 27(b) has been confined to whether the delivery by post of the letter of 13 May 1999 to Transport Workers' Union (Tasmania) amounts to consultation with the Transport Workers' Union of Australia within the meaning of cl 27(b).  Whether or not the Transport Workers' Union of Australia (Tasmanian Branch) had been dissolved at that time or had been disbanded will be irrelevant, at least as to the identity of the organisation to be consulted.  The whole conduct of the litigation to date seems to have proceeded on the basis that there was no issue as to the identity of the organisation to be consulted, but only as to whether sending it a copy of the letter of dismissal amounted to consultation.

1. The present application seeks to change all that and to raise the defence of frustration of contract, putting an end to the requirement of lawful termination that a particular organisation then no longer in existence or no longer functioning, be consulted.

1. It should be noted that this case was listed for trial on 17 February last and worked up for trial by the plaintiff.  On 11 February it was appreciated that the case then proceeding would not finish in time for this case to be heard in that Sittings and the parties agreed that it be placed in this Sittings with a fixed day.  The application is made on the second day of a jury trial.

1. No affidavit material or other evidentiary material has been put before me deposing to the alleged fact that at the time consultation with the Union (to use a neutral expression) was required, namely May 1999, the Transport Workers' Union (Tasmanian Branch) had been dissolved, abolished, disbanded or had otherwise ceased to function.  Certain matters of public record in the Federal Court suggest the contrary, for there are case reports of orders in that jurisdiction validating actions, decisions, resolutions and determinations of the Tasmanian Branch of the Transport Workers' Union in the relevant period and a case where Heerey J, on 23 March 2000, ordered on an interim basis that the Transport Workers' Union of Australia and others be restrained from attempting to disband the Tasmanian Branch.  See Hansch v Transport Workers' Union of Australia [2000] FCA 473 and Transport Workers' Union of Australia [2000] FCA 1267. At the least it appears that the precise status of the Transport Workers' Union (Tasmanian Branch) as at the time of the termination of the contract, if made an issue, is a matter about which considerable evidence might need to be adduced on trial if the amendments to the already amended defence are permitted and that realistically this hearing, in which a civil jury has been empanelled, would have to be aborted and a fresh trial ordered. In the circumstance that the present trial is the second occasion on which the case has had to be worked up, this is a prospect which will cause the plaintiffs more prejudice than can normally be compensated for by an order for costs. It is one of those cases in which I would be prepared to infer that further delay will impose on the plaintiffs anxieties and other concerns of the kind referred to by Lord Griffiths in Ketteman v Hansel Products Ltd [1987] AC 189 and which ought to be brought into the balance in assessing the degree of prejudice caused them thereby and in determining whether this can be adequately remedied by orders for costs.

1. Dawson, Gaudron and McHugh JJ said in Queensland v J L Holdings Pty Ltd (1996 - 1997) 189 CLR 146 at 155, a case on amendment, said:

"Justice is the paramount consideration in determining an application such as the one in question.  Save in so far as costs may be awarded against the party seeking the amendment, such an application is not the occasion for the punishment of a party for its mistake or for its delay in making the application."

That was a case where an amendment had been refused in the circumstance that as a result, a fixed date for a four month trial set six months ahead, would have to be vacated.  The court held that case management was a relevant, but not dominant, consideration.  Here, however, the trial is under way and in my view to grant either application would cause a prejudice to the plaintiffs which could not be adequately compensated. 

1. On the other hand, the refusal of the amendments will deny the defendant the possibility (for the factual basis is still speculative) of relieving it of an obligation to consult with a Union entity because the particular entity did not operate at the relevant time.  Prior to this application, it seems clear from the conduct of the defendant's case that it accepted an obligation to consult with a Union entity, as the contract clearly envisaged, and it claimed to have done so in fact.  It now appears that the identity of that entity could be a matter of doubt and the defendant seeks to avail itself of the possibility that it was relieved of the obligation to consult at all because the Tasmanian Branch of the Transport Workers' Union was not capable of being consulted.  I do not regard that as a prejudice or disadvantage which outweighs the prejudice the amendments will cause to the plaintiffs.

1. Furthermore, in the absence of evidence showing at least the likelihood that the fact sought to be pleaded is true, it seems to me to be inappropriate to grant the application on the off-chance that it may be true and thus advantage the defendant.  It has been said that "an admission in a pleading is a serious step for a party to take.  It means that proof is no longer required or permitted of the fact admitted as the fact is no longer in controversy between the parties" and that "As a matter of principle a party who has made an admission in a pleading should not be entitled to withdraw that admission without good cause" per Beach J in Divcon v Devine Shipping [1996] VR 79 at 80. I also refer to Murran Investments Pty Ltd v Aromatic Beauty Products Pty Ltd (2002) 191 ALR 579 at 589, where Mansfield J said in respect of an application for an amendment:

"It is therefore necessary, as their Honours point out in Celestino (unreported, Federal Court of Australia, Spender, Miles and von Doussa JJ, 16 August 1990) at pp 8 - 10, to be satisfied:

·   that an error or mistake by or on behalf of the party seeking the amendment has been demonstrated;

·   that a sensible explanation for the making of the admission has been provided, based on evidence of a solid and substantial character; and

·   that no injustice will be occasioned to the other party by the withdrawal of the admission, other than hardship by delay or cost which can be accommodated by an appropriate order for costs."

In those circumstances, the application is refused.