Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 11]
[2016] WASC 235
•4 AUGUST 2016
MINERALOGY PTY LTD -v- SINO IRON PTY LTD [No 11] [2016] WASC 235
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2016] WASC 235 | |
| Case No: | CIV:1808/2013 | 26 MAY 2016 | |
| Coram: | CHANEY J | 4/08/16 | |
| 14 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| B | |||
| PDF Version |
| Parties: | MINERALOGY PTY LTD SINO IRON PTY LTD KOREAN STEEL PTY LTD CITIC LTD (formerly CITIC PACIFIC LTD) |
Catchwords: | Practice and procedure Summary judgment Leave to apply out of time Application made three years after time limit No explanation for delay Whether a new claim Requirement to do justice between parties |
Legislation: | Rules of the Supreme Court 1971 (WA), O 14, O 14 r 1 |
Case References: | Barrick Gold of Australia Ltd v FL Smidth Inc [2007] WASC 186 Batistatos v Roads and Traffic Authority of New South Wales [2006] HCA 27; (2006) 226 CLR 256 Fancourt v Mercantile Credits Ltd [1983] HCA 25; (1983) 154 CLR 87 Gallo v Dawson [1990] HCA 30; (1990) 93 ALR 479 General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125 Hughes v National Trustees Executors & Agency Co of Australasia Ltd [1978] VR 257 Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61; (2007) 233 CLR 115 Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 10] [2016] WASC 90 Ratnam v Cumarasamy [1964] 3 All ER 933 Shevill v Builders Licensing Board [1982] HCA 47; (1982) 149 CLR 620 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
SINO IRON PTY LTD
First Defendant
KOREAN STEEL PTY LTD
Second Defendant
CITIC LTD (formerly CITIC PACIFIC LTD)
Third Defendant
Catchwords:
Practice and procedure - Summary judgment - Leave to apply out of time - Application made three years after time limit - No explanation for delay - Whether a new claim - Requirement to do justice between parties
Legislation:
Rules of the Supreme Court 1971 (WA), O 14, O 14 r 1
Result:
Application dismissed
Category: B
Representation:
Counsel:
Plaintiff : Mr S Couper QC & Mr J V Gooley
First Defendant : Mr C M Scerri QC, Mr S H Parmenter &
Ms T Spencer Bruce
Second Defendant : Mr C M Scerri QC, Mr S H Parmenter &
Ms T Spencer Bruce
Third Defendant : Mr C M Scerri QC, Mr S H Parmenter &
Ms T Spencer Bruce
Solicitors:
Plaintiff : Kilmurray Legal
First Defendant : Allens
Second Defendant : Allens
Third Defendant : Allens
Case(s) referred to in judgment(s):
Barrick Gold of Australia Ltd v FL Smidth Inc [2007] WASC 186
Batistatos v Roads and Traffic Authority of New South Wales [2006] HCA 27; (2006) 226 CLR 256
Fancourt v Mercantile Credits Ltd [1983] HCA 25; (1983) 154 CLR 87
Gallo v Dawson [1990] HCA 30; (1990) 93 ALR 479
General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125
Hughes v National Trustees Executors & Agency Co of Australasia Ltd [1978] VR 257
Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61; (2007) 233 CLR 115
Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 10] [2016] WASC 90
Ratnam v Cumarasamy [1964] 3 All ER 933
Shevill v Builders Licensing Board [1982] HCA 47; (1982) 149 CLR 620
1 CHANEY J: This action was commenced in 2013. It has had a long and convoluted history of interlocutory disputes. The pleadings on both sides have been amended on numerous occasions. On 23 March 2016, I delivered reasons granting leave for the plaintiff (Mineralogy) to file a 'fourth further amended statement of claim' (current statement of claim) - see Mineralogy Pty Ltd v Sino Iron Pty Ltd [No 10] [2016] WASC 90. In those reasons I set out some of the history of the pleadings in this action and explained the various new claims introduced by the current statement of claim. Although it is not necessary to repeat that history, it provides a background against which this application is brought. Central to the issues in these proceedings are two Mining Right/Site Lease Agreements, one between the first defendant (Sino) and Mineralogy and the other between the second defendant (Korean) and Mineralogy (the MRSLAs). The two MRSLAs are in substantially the same terms. Among the various claims introduced by the current statement of claim is a claim, now found in [85] - [106], for an alleged breach of cl 16.1 of the MRSLAs. That claim is that the defendants failed to comply with a stipulation in cl 16.1 as to the standard of works to be undertaken pursuant to the MRSLAs which in turn led to a failure to develop the project to which the MRSLAs relate contrary to s 6.1 of the MRSLAs (cl 16.1 claim). Mineralogy claims that Sino and Korean thereby evinced an intention not to carry out their obligations as required by the MRSLAs and thereby repudiated the MRSLAs, thus entitling Mineralogy to terminate the MRSLAs.
2 Mineralogy now seeks leave to apply for summary judgment against the defendants pursuant to O 14 of the Rules of the Supreme Court 1971 (WA) in relation to the cl 16.1 claim. Subject to the grant of leave, Mineralogy seeks a declaration that each of Sino and Korean have repudiated the MRSLA to which each is a party, various alternative declarations that the plaintiff lawfully terminated the respective MRSLAs on particular dates, and orders for the assessment of damages and payment by the defendants of damages as assessed.
Leave to apply
3 Order 14 r 1 of the Rules of the Supreme Court provides that a plaintiff may, on the ground that a defendant has no defence to a claim or to a particular part of a claim except as to the amount of any damages claimed, apply to the court for judgment 'within 21 days after appearance or at any later time by leave of the court'. The writ in this action was issued on 18 March 2013, and the defendants filed their memoranda of appearance on 10 April 2013. This application for summary judgment is therefore brought just short of three years after the time limited by O 14 r 1.
4 The policy of the rule that summary judgment applications be brought within a relatively short time frame is that such applications should be brought at an early stage of the proceeding and before unnecessary expense has been incurred: Barrick Gold of Australia Ltd v FL Smidth Inc [2007] WASC 186 [10] (Templeman J). The discretion to extend the time is given for the sole purpose of enabling the court to do justice between the parties: Hughes v National Trustees Executors & Agency Co of Australasia Ltd [1978] VR 257, 262; Gallo v Dawson [1990] HCA 30; (1990) 93 ALR 479, 480. The discretion should be exercised in favour of an applicant where strict compliance with the rules will work an injustice upon the applicant. In order to determine that question, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation and the consequences for the parties of the grant or refusal of the application for an extension of time: Gallo 480. There should be material before the court upon which it can exercise its discretion: Ratnam v Cumarasamy [1964] 3 All ER 933, 935 (Lord Guest). Usually it will be incumbent on an applicant for an extension of time to provide an adequate explanation for the delay.
5 The plaintiff submits that leave should be granted because:
(i) the claim pleaded in [85] - [106] of the current statement of claim is a new claim;
(ii) there can be no relevant factual dispute in relation to the claim because the facts upon which the claim is based are either facts pleaded by the defendants themselves in Schedule D to their counterclaim or are extracted from public documents produced by the defendants, such as stock exchange announcements;
(iii) in the absence of a factual dispute, the question is simply one of construction of the relevant provisions of the MRSLAs and in particular cl 16.1;
(iv) if a summary judgment application is heard and determined in the plaintiff's favour, it will resolve the issue of termination of the MRSLAs without the need for a trial to consider the other four grounds of repudiation pleaded in the current statement of claim. Mineralogy submits that while '[i]t is true that issues of damages, and issues of claims for damages relating to other breaches of the MRSLAs would remain', a decision that the MRSLAs have been terminated 'would effectively focus the parties' attention on whether there could be a commercial resolution of all issues'.
6 In those circumstances, and given that the trial of all issues is some considerable time away, Mineralogy submits that 'seeking to resolve the central issue, based on an argument of construction which is in short compass, where the facts are not in dispute, is an appropriate use of the court's resources and an appropriate means of doing justice between the parties'.
7 The defendants contend that the claim contained in [85] - [106] of the current statement of claim is not a new claim. That submission is correct. The examination of the history of the proceeding undertaken by the defendants is supported by the extensive evidence filed in relation to the summary judgment application. The defendants accurately summarised that relevant history as follows:
(a) The stock exchange announcements that Mineralogy relies upon for this application are plainly publicly available documents. Moreover, by at least February 2013, Mineralogy was aware of their content, making reference to their statements about MCC's performance in pre-action correspondence.
(b) Further, the progress of the Project and the status of the construction of each item of plant was regularly communicated to Mineralogy from the commencement of the project through monthly reports and meetings.
(c) The second source from which Mineralogy draws its factual material for the claim the subject of this application is Schedule D to the Counterclaim. This Schedule was first filed by the defendants on 20 June 2013.
(d) Paragraph 56 of the Reply filed by Mineralogy on 23 July 2013, pleaded 'by reason of the matters alleged in Schedule D, Sino and Korean respectively have breached clause 16 of the MRSLAs'.
(e) The 'standard of work' claim (being a claim that Sino and Korean had breached clause 16 of the MRSLAs) was introduced by Mineralogy in its Claim by paragraph 85 of its Further Amended Statement of Claim delivered on 14 August 2013. It was then withdrawn in the Second Further Amended Statement of Claim filed on 10 December 2013.
(f) The 'standard of work' claim was then re-introduced in the proposed Third Further Amended Statement of Claim delivered on 15 April 2014, only to be deleted from the subsequent version of the proposed Third Further Amended Statement of Claim delivered by Mineralogy on 6 June 2014, and did not appear in subsequent versions.
(g) On 15 September 2014, Mineralogy issued a notice of default to each of Sino and Korean alleging a breach of clause 16.1. However Mineralogy withdrew that notice the following week, on 22 September 2014.
(h) On 31 August 2015 Mineralogy commenced proceeding CIV 2368 of 2015, which did not include a claim concerning 'standard of work', but on 29 September 2015 Mineralogy amended its statement of claim to introduce such a claim.
(i) CIV 2368 of 2015 was permanently stayed as an abuse of process on 27 November 2015 (including because its commencement was found to be an attempt to circumvent procedural requirements including the need to apply for leave to bring an application for summary judgment concerning the 'standard of work' claim).
(j) Mineralogy then amended its statement of claim in this proceeding to re-introduce the 'standard of work' claim and is now seeking summary judgment.
8 Apart from the assertion, which I do not accept, that the cl 16.1 claim is a 'new claim', there is no attempt by the plaintiff to explain the delay. As I apprehend Mineralogy's position in relation to an extension, it is in substance that:
(i) the case for summary judgment is so clear that it would work an injustice on Mineralogy if judgment on the cl 16.1 claim was delayed until all of the other claims and counterclaims are dealt with at trial; and
(ii) the need for a trial to consider other grounds of termination for repudiation pleaded in the current statement of claim could be avoided.
9 It is not the case, and it was not contended by the plaintiff, that a successful summary judgment application would avoid the need for a trial. Rather, a successful summary judgment application on the cl 16.1 claim might shorten the trial by reducing the number of issues to be determined. The issue of damages which would remain in relation to the cl 16.1 claim would significantly overlap at least some of the issues which would remain alive in the proceeding.
10 An affidavit of Clive Theodore Mensink relied upon by Mineralogy deposed to the need for Mineralogy to access funds to enable various companies associated with Mr Clive Palmer, of which Mineralogy is one, to meet ongoing liabilities, including legal costs. On that basis it was said that there was a need for this summary judgment application to be dealt with quickly. Given that, if successful, this application would result in an order for assessment of damages which, in all likelihood, could only proceed after the trial of other issues in the proceedings which would impact on any assessment of damages, Mineralogy's financial position in the short term would not be enhanced if judgment is given in the terms sought. The frank assertion in Mineralogy's written submissions that an interlocutory judgment would focus the parties' attention on a commercial resolution is no basis for an extension of time.
11 The extent to which a case management advantage might be achieved by a successful summary judgment application on the cl 16.1 claim is by no means clear.
12 It follows that the plaintiff bears a significant burden in establishing that the justice of the case requires an extension of time. It sought to discharge that burden by arguing that the case for summary judgment is so strong and the absence of a defence is so clear, that the justice of the case requires an extension of time.
13 In order, in any case, to order summary judgment, the court must be persuaded that the defendants have no arguable defence to that aspect of the claim in respect of which judgment is sought. As will be seen, I am not persuaded that the plaintiff has made out a case for summary judgment in relation to the cl 16.1 claim. That being the case, the principal basis of Mineralogy's application for an extension of time lacks merit.
Claim for summary judgment
14 It is well established that the power to order summary judgment is one that should be exercised with great care and should never be exercised unless it is clear that there is no real question to be tried: Fancourt v Mercantile Credits Ltd [1983] HCA 25; (1983) 154 CLR 87, 99.
15 Mineralogy made reference to the statement by Barwick CJ in General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125, 130 that it may be that extensive argument is required to demonstrate that there is no real question to be tried. Chief Justice Barwick's statement must be read in the context of the observations of Gleeson CJ, Gummow, Hayne, and Crennan JJ in Batistatos v Roads and Traffic Authority of New South Wales [2006] HCA 27; (2006) 226 CLR 256 [44] - [46]. Their Honours said [46]:
The statements in General Steel should not be given canonical force. More recently, in Agar v Hyde, Gaudron, McHugh, Gummow and Hayne JJ observed:
'It is, of course, well accepted that a court whose jurisdiction is regularly invoked in respect of a local defendant (most often by service of process on that defendant within the geographic limitations of the court's jurisdiction) should not decide the issues raised in those proceedings in a summary way except in the clearest of cases. Ordinarily, a party is not to be denied the opportunity to place his or her case before the court in the ordinary way, and after taking advantage of the usual interlocutory processes. The test to be applied has been expressed in various ways, but all of the verbal formulae which have been used are intended to describe a high degree of certainty about the ultimate outcome of the proceeding if it were allowed to go to trial in the ordinary way'.
3.2 Grant of Mining Right
Subject to this Agreement, Mineralogy hereby grants to Sino (Korean), in relation to the Mine Area, the following rights (collectively 'Sino's (Korean's) Mining Right'), namely the right:
(a) To exclusively use and occupy the Mine Area for 24 months from the date hereof subject to the use of any other party to which Sino (Korean) may consent, but only in accordance with the terms of this Agreement and for the purpose of exploring for and mining Magnetite Ore;
(b) to carry out or participate in, establishing a Mine within the Mine Area for mining Magnetite Ore;
(c) to carry out or participate in, Mining Operations for mining and extracting Magnetite Ore from the Mine Area;
(d) to take a quantity of all Magnetite Ore mined from the Mine Area, up to the Annual Extraction Limit in any Operating Year, and up to the Total Extraction Limit over the Term of Sino's (Korean's) Mining Right, for processing through Sino's (Korean's) Processing Facilities into Products which shall never exceed a total of 12 million tonnes a year as provided in this Agreement.
18 By cl 8, Sino (Korean) covenanted to pay royalties calculated in accordance with cl 8.2 on both the amount of ore taken and the amount of 'product' produced from the ore. A significant claim in the proceedings relates to royalties of the latter category.
19 By [85] - [88] of the current statement of claim, Mineralogy pleads the existence and terms of a contract between Sino Iron and Metallurgical Corporation of China (MCC), referred to as the 'general construction contract'. The general construction contract was directed to construction of the mining and processing facilities contemplated under the MRSLAs. Mineralogy is not a party to the general construction contract. It is pleaded that the general construction contract required MCC to design and construct plant according to a schedule of times for completion of various aspects of the project. It is pleaded that, for the purpose of the MRSLAs, MCC was an agent, employee or contractor of Sino and Korean and that by reason of cl 1.6 of the MRSLAs, all acts and omissions of Sino and Korean's agents, employees, contractors and invitees are deemed to be acts or omissions of Sino and/or Korean. The work carried out by MCC pursuant to the general construction contract is said to have formed part of Sino's and Korean's 'activities' as defined by the MRSLAs.
20 Paragraph 92 of the current statement of claim pleads numerous failures by MCC to meet the requirements of the general construction contract between February 2008 and April 2013. Paragraph 93 sets out various steps taken by the defendants or related companies in response to the failures by MCC to meet its requirements of a timetable under the general construction contract.
21 Paragraphs 94 and 95 plead cl 16.1 of the MRSLAs, which provides:
Standard of work
Sino (Korean) must carry out all Sino's (Korean's) Activities to the standard of care, skill and diligence that would normally be expected internationally of a professional and competent organisation implementing a project equivalent to Sino's (Korean's) Project, and in accordance with Good Industry Practices.
22 Paragraph 96 and 97 plead that, in complying with cl 16.1, Sino and Korean were required to ensure that MCC exercised the standard of care, skill and diligence as described in cl 16.1. Paragraph 98 pleads that MCC did not carry out the work under the general construction contract to the standard required by cl 16.1. Paragraphs 99 and 100 plead that each of Sino and Korean was aware from February 2008 that MCC did not carry out the work to the required standard, and [101] pleads that Sino and Korean took no steps to comply with cl 16.1.
23 Paragraph 102 pleads that Korean and Sino were required, pursuant to the MRSLAs, to proceed to develop and implement the project and in particular to establish the requisite processing facilities and proceed to exercise their respective mining rights. That obligation is said to arise under cl 6.1 of the MRSLAs which is in the following terms:
Implementation of project
Sino (Korean) will proceed to develop and implement Sino's (Korean's) Project and, in particular:
(a) Sino (Korean) will proceed to establish Sino's (Korean's) Processing Facilities within the Site Lease Area, and
(b) Sino (Korean) will proceed to exercise Sino's (Korean's) mining right within the Mine Area.
24 Mineralogy pleads that by reason of the matters pleaded in [85] - [101], Sino and Korean did not proceed to develop and implement their respective projects or proceed to establish their processing facilities in accordance with the MRSLAs or the 'Project Proposals'. Presumably 'Project Proposals' is a reference to what is defined as 'proposals' in [64] of the current statement of claim, being documents which comprised exhibit TLM8 to the affidavit Tracey Miley filed in support of the application. Those documents comprise some 223 pages. They are not otherwise mentioned in [85] - [106] of the current statement of claim, being those paragraphs setting out the cl 16.1 claim. Other than in a passing reference by Mineralogy to the pleadings, the Project Proposals were not mentioned in either oral or written submissions by either party. What, if any, reliance Mineralogy places on the Project Proposals in the context of the present application is unclear. Because the proposals were proffered as part of the evidence in support of the application, it might be assumed that the plaintiff places some reliance upon them. That question illustrates the difficulty of dealing in a summary way with an application concerning events and transactions taking place over a number of years and involving activities the subject of a significant number of interrelated contractual and other instruments.
25 Paragraph 104 of the current statement of claim pleads:
In the premises Sino Iron and Korean Steel evinced an intention to carry out their obligations under the MRSLAs as they saw fit and not in accordance with the MRSLAs.
26 Paragraphs 105 and 106 plead that 'in the premises' Sino and Korean respectively breached cl 16.1 and repudiated the respective MRSLA.
27 The facts pleaded in relation to the cl 16.1 claim were not in issue. The consequences of the facts were very much in issue.
28 In its written submissions, Mineralogy contended that the pleaded conduct said to be a breach of cl 16.1 entitled Mineralogy to terminate the MRSLAs on two bases. The first, which is reflected in [104] of the current statement of claim, is that, by reason of the conduct pleaded, Sino and Korean respectively evinced an intention to carry out their obligations under the MRSLAs as they saw fit, and not in accordance with the MRSLAs. The second basis is that cl 16.1 is properly regarded as an essential term of the MRSLAs, breach of which entitled Mineralogy to terminate. Counsel for Mineralogy submitted that the breach of essential term claim is embodied in [105] and [108] of the current statement of claim.
29 In Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61; (2007) 233 CLR 115, Gleeson CJ, Gummow, Heydon and Crennan JJ explained that:
[i]t is the common intention of the parties, expressed in the language of their contract, understood in the context of the relationship established by that contract and ... the commercial purpose it served, that determines whether a term is 'essential' so that any breach will justify termination [48].
30 The basis upon which Mineralogy submitted that cl 16.1 should be construed as a provision the breach of which entitled Mineralogy to terminate was expressed as follows:
It is obvious why compliance with clause 16.1 by Sino and Korean was a matter of considerable importance to Mineralogy. What Mineralogy was to receive under the MRSLAs was the payment of royalties. Subject to clause 6.3, commencement of the payment of royalties depended upon the commencement of production, and the ongoing amount of the royalties depended upon the quantity of product produced. It was vital to Mineralogy obtaining the benefits for which it bargained that production commence expeditiously and that production reach the quantity nominated by Sino and Korean in the Approval Proposals (27.6 MTPA) as soon as possible.
31 In the course of oral submissions, counsel for Mineralogy accepted the force of the proposition that there might be failures to perform work with the requisite care, skill or diligence which might have no impact at all on what Mineralogy asserts was the commercial purpose of the MRSLAs and no, or no significant, effect on the timeliness of development of the project. That proposition would appear to be supported by the fact that, unlike the general construction contract to which Mineralogy was not a party, the MRSLAs imposed no specific time frames for completion of activities or operations pursuant to the MRSLAs save for cl 6.3. Clause 6.3 required production of no less than 6 million tonnes of product (as defined in the MRSLAs) no later than seven years from the date of the MRSLAs. The consequence of a failure to meet that obligation (unless prevented from doing so by an act, matter or thing outside of Sino's (Korean's) control) was an obligation by Sino (Korean) to pay a stipulated amount to Mineralogy. Clause 6.3 is, in effect, a provision in the nature of a liquidated damages provision. A claim for breach of cl 6.3 by Mineralogy is one of the other claims made in the current statement of claim.
32 Counsel for Mineralogy accepted that cl 16.1 is 'probably better characterised' as an intermediate term, a sufficiently serious breach of which gives rise to a right to termination. I therefore take the alternative bases upon which Mineralogy puts the cl 16.1 claim as being either that Sino and Korean's conduct in breach of cl 16.1 evinced an intention not to be bound by the MRSLAs, or was a breach of an intermediate term of such seriousness as to substantially deprive Mineralogy of the benefit of the MRSLAs.
33 As Wilson J observed in Shevill v Builders Licensing Board [1982] HCA 47; (1982) 149 CLR 620, repudiation of a contract is a serious matter that is not to be lightly found or inferred, but needs to be determined having regard to all the circumstances of the case to see whether the conduct amounts to a renunciation or an absolute refusal to perform the contract (633). The defendants point to various matters referred to in the affidavit of David John Mason sworn in opposition to the application for summary judgment. Mr Mason said that the project the subject of the MRSLAs is the largest magnetite mine in Australia which, during construction, employed thousands of people. During 2009 through to 2013, the period during which the conduct said to be a breach of the MRSLAs, the capital expenditure on the project was in excess of A$8 billion. More than A$10 million have been paid in royalty payments to Mineralogy to date, and over A$20 million have been paid to the Department of Mines and Petroleum for state government royalties and other government charges.
34 Mr Mason identified various public statements made by the third defendant concerning its commitment to the project the subject of the MRSLAs.
35 As already noted, the facts relied upon by Mineralogy as amounting to a failure to carry out activities to the requisite standard of care, skill and diligence are said to have taken place over a number of years. In oral submissions, counsel for Mineralogy suggested that by August 2008, Sino and Korean had evinced an intention to develop the project in the manner and in the time which they saw fit, rather than in accordance with the MRSLAs. He contends that that conclusion can be objectively reached on the basis of the matters pleaded.
36 Whether or not, objectively, the events upon which Mineralogy rely can be said to evince an intention not to perform the obligations under the MRSLAs and to deprive Mineralogy of the benefit of the contract requires an examination of all of the circumstances. That includes the circumstances which the defendants may contend are relevant. It is not a question which is susceptible to summary disposal. It cannot be said that there is no real question to be tried in relation to that issue.
37 Similarly, any question of whether the conduct, either taken separately or in combination, constituted a breach of cl 16.1 of such seriousness as to entitle Mineralogy to terminate the MRSLAs is one which should be left to trial. Because the plaintiff itself, in the course of argument, changed the alternative basis upon which it sought judgment, from breach of an essential term, to a serious breach of an intermediate term, the latter was not fully argued. To the extent that the plaintiff's pleaded case is as to a breach of an essential term, there is clearly a serious question to be tried. To the extent that the case is as to a serious breach of an intermediate term, all the facts and circumstances surrounding the contract require examination at trial, rather than in a summary way.
38 The defendants raised a number of other arguments as to why summary judgment should be refused. One of those was that Mineralogy had failed to plead, or to bring any evidence, of the standard 'that would normally be expected internationally of a professional and competent organisation implementing a project equivalent to Sino's (Korean's) Project, and in accordance with Good Industry Practices', that being the standard imposed by cl 16.1. The defendants submit that without further pleading of specifically what, as a matter of fact, cl 16.1 required the defendants to do and the specific respects in which the defendants failed to meet the standard, it is not possible to understand the case which the plaintiff seeks to make. It is not appropriate in the context of this application to determine whether or not there is some defect in the pleading in the respect contended for by the defendants or whether, in order to determine the question of a repudiatory breach of cl 16.1, further evidence of the requisite standard is required. Those are matters for the plaintiff to consider. This issue between the parties illustrates, however, the unsuitability of determination of the cl 16.1 claim in a summary manner. The several thousand pages of affidavit material filed by the parties can only fairly and properly be considered in the context of a trial.
39 It is not necessary to deal with the various other defences which are pleaded by the defendants, or were the subject of the defendants' submissions. It cannot be said that there is no real question to be tried in relation to the cl 16.1 claim or that there is a higher degree of certainty that the claim will be determined in the manner contended for by Mineralogy.
40 In the circumstances, leave to bring the application for summary judgment out of time should be refused, and the application dismissed.
11
11
1