Proude v Visic (No 2) - [2012] SASC 233

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
PROUDE v VISIC (NO 2)
[2012] SASC 233
Judgment of The Honourable Justice Blue
19 December 2012
PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - PROCEDURE UNDER RULES OF COURT - PARTIES
PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - PROCEDURE UNDER RULES OF COURT - PARTIES - JOINDER OF PARTIES
The plaintiff brought proceedings against the first and second defendants for losses allegedly caused by a bushfire as a result of their negligence. In his original statement of claim, the plaintiff pleaded that:
1.      he brought the action on his own behalf; and
2.      he proposed to apply for authorisation to bring the action as a representative party for those who sustained property loss and damage caused by bushfire.
The plaintiff subsequently filed a further statement of claim in which he provided particulars of the property and consequential loss and damages suffered by him. In that statement of claim he provided particulars of damage to his own land, damage to land jointly owned with his wife, and loss of personal property and profits of a farming business conducted on the land by him as trustee of a trust.
The first defendant contends that the plaintiff’s claim as originally instituted was confined to a claim for damage to the plaintiff’s own land and did not extend either to a claim for damage to the jointly owned land or to a claim for loss as trustee of the Trust. The first defendant contends that the plaintiff is now out of time to add those additional claims.
Held:
Per Blue J:
Loss of personal property and loss of profits
1.      A plaintiff who suffers property loss and damage caused by the negligence of a defendant has a single indivisible cause of action for the entire loss and damage suffered (at [15]).
2.      A plaintiff is entitled to recover loss and damage caused by the commission of a tort to property of which the plaintiff is the legal owner. The fact that the property is held on trust is irrelevant (at [16]).
3.      The plaintiff has a single indivisible cause of action against the first defendant for losses suffered by him as a result of the first defendant’s alleged negligence. In his original statement of claim, the plaintiff claimed (without further particularisation) all of the losses, both direct and consequential, which he suffered as a result of the alleged negligence. He thereby claimed not only losses suffered by him as owner of the real property but also losses suffered by him as owner of personal property and the farming business, which he held on trust (at [17]-[35]).
Damage to land owned jointly
4.      On the proper construction of the original summons and statement of claim, the plaintiff was claiming for damage to all land owned by him, whether solely or jointly with his wife (at [57]-[65]).
5.      The plaintiff’s wife does not consent to be joined as a co-plaintiff. In all of the circumstances, the appropriate order is to join her as a co-defendant (at [66]-[72]).
Common Law Procedure Act 1852 (UK) ss 34-38; Limitations of Actions Act 1936 (SA) s 35; Rules of the Supreme Court 1962 (UK) Order 15 rule 4(2); Supreme Court Civil Rules 1987 (SA) Rules 9.04, 27.02; Supreme Court Civil Rules 2006 (SA) r 38, r 73, r 74, r 77, r 78, r 79, r 80, r 81, r 83; Rules of Procedure under the Supreme Court of Judicature Act 1873 (UK) Order XIX rule 13, referred to.
Marlborough Harbour Board v Charter Travel Co Ltd (1989) (1989) 18 NSWLR 223; Westpac Banking Corporation v Garrett [2004] SASC 265; Young v Murphy [1996] 1 VR 279, applied.
Adams v Paynter (1844) 1 Coll 530; 63 ER 530; Bell v Thompson (1934) 34 SR (NSW) 431; Brinsmead v Harrison (1872) LR 7 CP 547; Cullen v Knowles [1898] 2 QB 380; Duke of Belford v Ellis [1901] AC 1; Gardner v Northern Territory of Australia [2003] NTSC 113; Gebauer Nominees Pty Ltd v Cole [2006] WASC 169; Julie Anne Barrow Charitable Trust v Brisconnections Management Company Ltd [2009] FCA 412; Kendall v Hamilton (1879) 4 App Cas 504; Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178; May v Newton (1887) (1887) 34 Ch D 347; Luke v South Kensington Hotel Company (1879) 11 Ch D 121; Re Clarke; Ex parte Buckley (1845) 14 M & W 469; 153 ER 559; Read v Prest (1854) 1 K & J 183; 69 ER 421; Thompson v Australian Capital Television Pty Ltd [1996] HCA 38; (1996) 186 CLR 574; XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd [1985] HCA 12; (1985) 155 CLR 448; Vestris v Cashman (1998) 72 SASR 449; Watters v May Bros Ltd [1932] SASR 418; Werderman v Société Générale d'Électricité (1881) 19 Ch D 246; Whelpdale’s Case (1572) 5 Co Rep 119; Wilson, Sons & Co v Balcarres Brooke Steamship Company [1893] 1 QB 422, considered.

WORDS AND PHRASES CONSIDERED/DEFINED
"representative"

PROUDE v VISIC (NO 2)
[2012] SASC 233
Civil Interlocutory:
BLUE J:

Mr Proude is suing Mr Visic and the South Australian Country Fire Service (“CFS”) for losses allegedly caused by bushfire on 10 and 11 January 2005 as a result of their negligence.
Issues have arisen whether Mr Proude is suing, not only for damage to land owned solely by him, but also for:
1.damage to land owned by him jointly with his wife Latisha Proude; and
2.loss of and damage to personal property owned by him, and loss of profits from the farming business conducted on the land by him, on trust for the Moni Carbi Trust.
These reasons for judgment address those issues.[1]
[1] Mr Proude also claims to sue pursuant to rule 81 of the Supreme Court Civil Rules 2006 (SA) as representative of all persons who sustained property loss or damage due to the fire. That aspect is not directly relevant to the matters the subject of these reasons for judgment. It is addressed in my reasons for judgment in Proude v Visic (No 3) [2012] SASC 228. It does, however, arise indirectly as potentially impacting the construction of Mr Proude’s summons and statement of claim, as appears below.
Background facts
At material times, Mr and Mrs Proude between them owned approximately 1,400 hectares of farming land situated at Charlton Gully, north of Port Lincoln on Lower Eyre Peninsula (collectively “the Proude land”). Mr Proude owned approximately 1,065 hectares.[2] Mr and Mrs Proude jointly owned approximately 335 hectares.[3]
[2] Certificate of Title Register Book volume 5292 folios 915 and 962; volume 5626 folio 71; volume 5656 folio 540; and volume 5733 folios 811 and 812.
[3] Certificate of Title Register Book volume 5355 folio 16; and volume 5973 folio 693.
At material times, Mr Proude was the trustee of the Moni Carbi Trust (“the Trust”). Mr Proude, as trustee of the Trust, carried on a farming business on the whole of the Proude land and owned personal property used by that business, including plant and equipment, poly pipe irrigation, farm contents, hay, livestock and fencing, which was situated on the Proude land.[4]
[4] It is possible that the fencing was a fixture, but for present purposes I assume that it comprised personal property as claimed by Mr Proude.
On 10 January 2005 at about 3.00 pm, a fire broke out on the eastern side of Lady Franklin Drive, Lower Eyre Peninsula, approximately 45 kilometres north-west of Port Lincoln.[5] Some time before 3.00 pm, Mr Visic drove and parked his land cruiser in the general vicinity in which the fire broke out.[6] The fire burnt a relatively small area of land up to a swamp known as paperbark swamp during the afternoon and night of 10 January 2005.[7]
[5] Third Statement of Claim [7], first defendant’s Defence [7], second defendant’s Second Defence [7].
[6] Third Statement of Claim [6], first defendant’s Defence [6], second defendant’s Second Defence [6].
[7] Third Statement of Claim [13-16], first defendant’s Defence [16], second defendant’s Second Defence [13], [15], [16].
On the morning of 11 January 2005, a fire or fires (it being in dispute in the action whether it was the same fire or a different fire or fires) broke out and burnt an extensive area of land comprising approximately 78,000 hectares.[8] The fire or fires (collectively “the bushfire”) allegedly caused extensive damage to land owned by at least 257 landholders, including the Proude land.[9]
[8] Third Statement of Claim [16-17], first defendant’s Defence [16], second defendant’s Second Defence [16]. This figure includes the relatively small area burnt on 10 January.
[9] Affidavit of Peter Humphries sworn on 22 October 2012 (FDN 35).
On 21 December 2010, Mr Proude instituted this action by filing a summons and statement of claim. In the statement of claim, Mr Proude pleaded that:
1. he brought the action on his own behalf (paragraph 3);
2.he proposed to apply for authorisation to bring the action as a representative party for those who sustained property loss and damage caused by bushfire (“the Group Members”) (paragraph 4);
3.he suffered both property and consequential loss and damage by reason of the bushfire (paragraphs 18 and 26).
On 1 November 2012, Mr Proude filed his Third Statement of Claim. Amongst other things, he provided particulars of the property and consequential loss and damage allegedly suffered by him. In those particulars, he identified his land as the Proude land (ie the land held by him and the land held by him jointly with Latisha Proude) and he pleaded that:
1. the quantum of damage to his own land was $1,503,898;
2. the quantum of damage to the jointly owned land was $358,897;
3.the quantum of loss of personal property suffered by him as trustee of the Trust was $404,997;
4.the quantum of loss of profits from the farming business suffered by him as trustee of the Trust was $1,862,795 (in the alternative to the claim for damage to the Proude land summarised at 1 and 2 above).
Mr Visic contends that the claim made by Mr Proude (as opposed to the (foreshadowed) claim as a representative party pursuant to rule 81) in December 2010 was confined to a claim for damage to his own land being item 1 in [9] above and did not extend to items 2, 3 or 4 therein. Mr Visic contends that Mr Proude is now out of time to add those additional claims.[10]
[10] Limitation of Actions Act 1936 (SA) s 35(c).
Mr Proude contends that he brought the action claiming for damage to the land which he owned and co-owned and as legal owner of the personal property and business conducted on the land. His solicitor swore an affidavit that this was Mr Proude’s intention and instructions in December 2010.[11]
[11] Affidavit of Peter Humphries sworn on 1 November 2012.
Loss of personal property and loss of profits
Mr Visic contends that, in December 2010, Mr Proude did not claim in respect of personal property or profits in respect of the business which he conducted on the land as trustee of the Trust and he is now out of time to do so.[12]
[12] Limitations of Actions Act 1936 (SA) s 35(c).
Mr Proude joins issue with Mr Visic and in the alternative seeks by paragraph 1 of interlocutory application dated 1 November 2012 (FDN 46):
An order that, to the extent that the Court deems it necessary, permission be granted to the Plaintiff to alter the capacity in which he sues to that of his personal capacity and as trustee of the Moni Carbi Trust, and to make such consequential amendments as may be required to the Summons and the Statement of Claim in this Action …
Legal principles
The cause of action pleaded by Mr Proude is the tort of breach of duty of care (negligence). This is a common law cause of action.
A plaintiff who suffers loss and damage to property caused by the commission of the tort of negligence by a defendant has a single indivisible cause of action for the entire loss and damage suffered.[13] There is not a separate cause of action for different heads of damage (eg damage to real property, damage to personal property, consequential losses, loss of use of monies, etc).[14] There is not a separate cause of action for each item of damage (eg for each of 2,205 sheep allegedly killed as a result of Mr Visic’s alleged negligence).
[13] Marlborough Harbour Board v Charter Travel Co Ltd (1989) 18 NSWLR 223 at 230-231 per Hope JA (Clarke and Meagher JJA agreeing).
[14] As observed in Marlborough Harbour Board cited above, there is an anomalous exception to this principle in respect of personal injury, but that is not presently relevant.
A plaintiff is entitled to recover for loss and damage caused by the commission of a tort to property of which the plaintiff is the legal owner.[15] The fact that the plaintiff might hold that property on trust (whether a bare trust, a fixed trust, a discretionary trust or otherwise) is irrelevant: it does not deprive the plaintiff of the entitlement to claim for the loss of or damage to that property. Effectively, the relationship in equity of trustee and beneficiary is irrelevant to the common law cause of action in tort and to the tortious relationship between the plaintiff and the defendant.
[15] Young v Murphy [1996] 1 VR 279 at 290-291 per Brooking JD (Batt J agreeing).
It follows from the application of these principles that Mr Proude has a single indivisible cause of action against Mr Visic for losses suffered by him as a result of the alleged negligence of Mr Visic. Mr Proude commenced an action for that cause of action on 21 December 2010. In the original statement of claim, he claimed (without further particularisation) the losses, both direct and consequential, which he suffered as a result of the alleged negligence. Such losses in fact encompassed losses suffered by him as owner of the real property as well as losses suffered by him as owner of personal property and the farming business (which he happened to hold on trust for the Trust).
Construction of statement of claim
Mr Proude’s claim for loss and damage was pleaded in two separate paragraphs of his original statement of claim as follows:
18.By reason of the Fire, … the Plaintiff … sustained property loss and/or damage. Particulars of the property loss and/or damage will be provided prior to the determination by the Court of the issue of quantum …
26.By reason of the property loss and/or damage pleaded in paragraph 18 above, … the Plaintiff … suffered loss and damage. Particulars of the loss and damage suffered will be provided prior to the determination by the Court of the issue of quantum …[16]
[16] References to the claim by the Group Members the subject of the foreshadowed rule 81 application omitted.
Paragraph 18 of the original statement of claim is apposite to encompass not only damage to real property but also loss of and damage to personal property. It is apt to encompass the loss of and damage to the personal property owned by Mr Proude which he happened to hold on trust for the Trust.
Paragraph 26 pleads losses which are consequential on the property loss. The only consequential loss suffered by Mr Proude was the loss of profit suffered by him in the business which he conducted on trust for the Trust. He did not suffer any consequential loss in respect of the damage to real property. If he had been claiming only in respect of damage to the real property, there would have been no claim by him for consequential loss in paragraph 26.
Mr Visic contends that there are two counter indicia in the original summons and statement of claim which suggest that Mr Proude was not claiming in his own right for loss of and damage to the personal property owned by him and loss of profits from the business conducted by him on trust for the Trust. The first is that Mr Proude did not include an endorsement that he brought the action, in part, as trustee of the Trust, which would have been required by rule 38(3)(d) of the Supreme Court Civil Rules 2006 (SA) (“the Rules”) if he had been making a claim on behalf of the Trust. The second is that Mr Proude attached to the original statement of claim an annexure listing Group Members and the annexure included “Moni Carbi Trust”. I address these contentions in turn.
Endorsement required when action brought in representative capacity
Rule 38(3)(d) provides as follows:
(3) Originating process must bear the following endorsements –
…
(d) if the action is brought in a representative capacity – an endorsement of the capacity in which the plaintiff brings the action.
Mr Visic contends that an action in tort by a plaintiff for damage to property which the plaintiff holds on trust is necessarily an action “brought in a representative capacity” within the meaning of rule 38(3)(d) because a trustee is a “representative” of the beneficiaries. Mr Proude contends that a trustee is not a “representative” for the purpose of rule 38(3)(d).
The Rules should, where possible, be read in harmony and as part of an integrated procedural scheme. In keeping with this principle, rule 38(3)(d) should be read in conjunction with, and as referring to, representative actions of the type addressed by rules 78, 80 and 81.
Rule 78 provides for proceedings to be brought on behalf of a person under a disability by a guardian who has authority to represent the interests of the person under the disability. Rule 78(4) describes the person under a disability as being “represented by a litigation guardian” and rule 79 is to the same effect.
Rules 80 and 81 provide that, in defined circumstances, a plaintiff may bring an action “as representative of a group”.
In each of these circumstances, the named plaintiff is asserting rights of another person in circumstances in which the legal cause of action vests in the other person. But for the representative bringing the action, the other person would otherwise be named as plaintiff. By contrast, when a plaintiff sues in tort for damage to property which the plaintiff holds on trust, the plaintiff is asserting his or her own rights as legal owner of the property and suing on his or her own cause of action. Such a plaintiff is not suing in a “representative capacity” within the meaning of rule 38(3)(d).
Rule 83 provides for actions to be brought by trustees as representatives of all persons interested in a trust. However, this rule is intended to apply to actions (typically those which would formerly have been in the Court of Chancery) in which the particular cause of action makes the trust relevant (eg a claim in equity against a former trustee for breach of trust) as opposed to an ordinary common law action in which it is irrelevant.[17] In Westpac Banking Corporation v Garrett,[18] White J held that a defendant who was sued for a debt incurred as trustee of a trust was not being sued “in a representative capacity” within the meaning of rule 9.04 of the Supreme Court Civil Rules 1987 (SA) (the predecessor to rule 38(3)(d)).[19] The same reasoning applies to a plaintiff trustee suing for damages caused by tort.
[17] For examples of the application of rule 83 and its predecessors (including Chancery practice before the Judicature Acts), see Read v Prest (1854) 1 K & J 183; 69 ER 421 at 422 per Sir Page Wood VC; May v Newton (1887) 34 Ch D 347 at 349-350 per Kay J; Watters v May Bros Ltd [1932] SASR 418 at 424 per Piper J.
[18] [2004] SASC 265.
[19] Ibid at [40]-[41].
Accordingly, no endorsement under rule 38(3)(d) was required if Mr Proude was bringing the action for damages suffered by him as trustee of the Trust. The absence of an endorsement is not an indicium that he was not suing for such damages.
Annexure to the statement of claim
Paragraph 4 of the original statement of claim read as follows:
The Plaintiff also proposes to apply for authorisation pursuant to [rule 81] to bring this Action as a representative party on behalf of a group of persons (“the Group Members”), being all persons and or corporations who sustained property loss and damage caused by reason of the [bushfire] including those named in the schedule annexed hereto.
The schedule contained 285 entries. Entry 168 read as follows:
Moni Carbi Trust – ABN 46 641 747 442

It is axiomatic that a trust as such has no standing to sue – it is the trustee who is the appropriate party to sue.[20]
[20] Gebauer Nominees Pty Ltd v Cole [2006] WASC 169 at [17] per McLure JA; Julie Anne Barrow Charitable Trust v Brisconnections Management Company Ltd [2009] FCA 412 at [9] per Gordon J.
Paragraph 26 of the original statement of claim pleads consequential loss suffered by Mr Proude in circumstances in which Mr Proude did not suffer any consequential loss other than as trustee of the Trust.
Paragraph 4 does not refer to or define the Group Members as persons “other than” the plaintiff. Its wording suggests that the definition of Group Members includes the plaintiff.
Taking into account the above, together with the position at law that Mr Proude had a single indivisible cause of action for all loss and damage suffered by him as a result of the tort, I construe the annexure as including the plaintiff’s own claims as well as the claims which he was seeking to bring as a representative party pursuant to rule 81.[21]
[21] There ought to have been a strict separation between the claim brought by the plaintiff in his own right and as a representative under rule 81, but I am construing the statement of claim as a matter of reality rather than technical perfection.
Conclusion
The two matters relied upon by Mr Visic are not indicia that Mr Proude did not bring the action claiming loss and damage suffered by him as trustee of the Trust. I hold that Mr Proude brought the action claiming, amongst other things, loss and damage to personal property and loss of profits suffered by him as trustee of the Trust.
Given my conclusion, it is unnecessary and inappropriate to make an order of the type sought by Mr Proude in paragraph 1 of FDN 46 in the alternative to his primary contention.
Damage to land owned jointly
Mr Visic contends that, when Mr Proude commenced the action in December 2010, he was not claiming for damage to the land owned by him jointly with Mrs Proude and he is now out of time to bring an action to recover that loss.[22]
[22] Limitation of Actions Act 1936 (SA) s 35(c).
Mr Proude joins issue with Mr Visic and in any event, by paragraph 2 of his application dated 1 November 2012 (FDN 46), he seeks directions pursuant to rule 73(3) of the Rules. Specifically, he seeks an order that, insofar as the action relates to land owned by him as joint tenant with Mrs Proude, he be authorised to proceed with the action in a non-representative capacity pursuant to rule 73(3)(b) of the Rules.
By interlocutory application dated 6 November 2012 (FDN 51), Mr Visic seeks an order staying the plaintiff’s claim in respect of any claim for damages to the property owned by Mr Proude jointly with Mrs Proude.
Joint rights and obligations
In certain circumstances, the substantive common law regards persons as having joint rights and/or liabilities. Examples include:
1.partners contracting with third parties: the partners’ contractual rights and liabilities are joint;[23]
2. persons committing a tort in concert: their liability is joint;[24]
3.co-owners of land who hold as joint tenants: the co-owners have joint rights against persons committing torts causing damage to the land.[25]
[23] Re Clarke; Ex parte Buckley (1845) 14 M & W 469; 153 ER 559 per Parke B (Alderson B agreeing).
[24] Brinsmead v Harrison (1872) LR 7 CP 547; Bell v Thompson (1934) 34 SR (NSW) 431 at 435 per Jordan CJ; XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd [1985] HCA 12; (1985) 155 CLR 448 at 455-456 per Gibbs CJ (Murphy and Wilson JJ agreeing) and 466-467 per Brennan J.
[25] Gardner v Northern Territory of Australia [2003] NTSC 113 at [63] per Riley J.
Procedural law differentiates, and has always differentiated, between actions involving joint rights or liabilities and those involving several rights or liabilities.
Procedural rules for joinder where rights joint
Rule 73(3) of the Rules provides:
If a plaintiff is jointly interested in the subject matter of an action with some other person who has not consented to be joined as a plaintiff, the plaintiff must apply to the Court for directions and, on such an application, the Court may exercise one or more of the following powers —
(a)authorise the plaintiff to proceed with the action as representative of any interested person who is not a party to the action;
(b)authorise the plaintiff to proceed with the action in a non-representative capacity despite the other person’s non-participation and determine the extent (if any) to which the other person is to be entitled to participate in any proceeds of the action;
(c)give directions the Court considers appropriate in the circumstances.
Rule 77 provides:
(1) The validity of an action is not affected by the misjoinder or non-joinder of a particular person as a party.
(2) In the case of misjoinder or non-joinder, the Court may determine the issues in dispute so far as they affect the persons who have been properly joined as parties.
Rule 38(4) provides:
Every person whose interests may be directly and adversely affected by the terms of a judgment, and whose presence before the Court is required for a judgment to be entered in those terms, is to be made a defendant to the originating process.
Rule 74(1) provides:
The Court may, on application or on its own initiative, order that a person who is not a party to the action be joined as a party if satisfied that—
(a)     the person has an interest in the subject matter of the action or in a question of law or fact involved in the action; or
(b)     the Court may require the person’s cooperation in order to enforce a judgment; or
(c)     the person has a right to joinder as a party under an Act or rule; or
(d)     the person should be joined as a party to ensure that all matters in dispute in the action are determined; or
(e)     the person should be joined as a party in order to enable determination of a related dispute and thus avoid multiplicity of proceedings.
Genesis of procedural law
The purpose and effect of the current rules is better understood having regard to their genesis.
At common law, where persons had joint rights (or joint liabilities), the cause of action was single and indivisible.[26] As a result, prima facie all joint right holders were required to join as plaintiffs in actions asserting their joint rights (and all persons owing a joint obligation were required to be joined as defendants).
[26] Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 603-611 per Gummow J.
The rule at common law was that, if all joint right holders were not joined as plaintiffs (or all persons jointly liable were not joined as defendants), a defendant could plead abatement and seek dismissal of the action.[27] The Common Law Procedure Act 1852 (UK), by sections 34 to 38, permitted amendment of the writ to join as co-plaintiff a person jointly entitled, either before or after a plea in abatement by the defendant.
[27] Whelpdale’s Case (1572) 5 Co Rep 119.
Equity took a similar approach to the common law in requiring all parties jointly entitled or jointly liable to be parties to the action.[28] If a joint right holder would not or could not join as a co-plaintiff, equity permitted joinder of that person as a co-defendant to ensure that all necessary parties were parties to and bound by the action.[29]
[28] Duke of Bedford v Ellis [1901] AC 1 at 8 per Lord Macnaghton.
[29] Luke v South Kensington Hotel Company (1879) 11 Ch D 121 at 126 per Jessel MR and 128-129 per James LJ; Cullen v Knowles [1898] 2 QB 380 at 381-382 per Bigham.
Rule 9 of the Rules of Procedure enacted by the Supreme Court of Judicature Act 1873 (UK) provided that:
No action shall be defeated by reason of the mis-joinder of parties, and the Court may in every action deal with the matter in controversy so far as regards the rights and interests of the parties actually before it.
Order XIX rule 13 of the Rules of Procedure (“the 1875 Rules”) enacted by the Supreme Court of Judicature Act 1875 (UK) provided that:
No plea or defence shall be pleaded in abatement.
The 1875 Rules were construed as abolishing the pleas of abatement and demurrer because a person jointly entitled or jointly liable had not been joined as a party.[30] The 1875 Rules were also construed so as to permit the court to follow the chancery practice in all cases of joining as a co-defendant a person jointly entitled who did not consent to joinder as co-plaintiff. The power to join a person jointly entitled as a defendant was made express by Order 15 rule 4(2) of the Rules of the Supreme Court 1962 (UK), which was reproduced in substance as rule 27.02 of the Supreme Court Civil Rules 1987 (SA).
[30] Kendall v Hamilton (1879) 4 App Cas 504; Werderman v Société Générale d'Électricité (1881) 19 Ch D 246; Wilson, Sons & Co v Balcarres Brooke Steamship Company [1893] 1 QB 422.
Accordingly, since 1875, at both equity and common law a joint right holder could be joined as a co-defendant if he or she declined to join as a co-plaintiff. This approach applied in South Australia until 2006, when the Rules came into force and rule 73(3) modified the established procedure.
Powers of Court where all joint right holders not joined
Where a plaintiff brings an action in which the plaintiff is jointly interested with another person who does not join as co-plaintiff, the Court now has available a range of powers under the Rules to make appropriate orders. Those powers include:
1.authorising the plaintiff to proceed with the action as representative of the other person jointly entitled to the cause of action;[31]
2.authorising the plaintiff to proceed with the action despite the other person’s non participation;[32]
3. joining the other person as a defendant.[33]
[31] Rules 73(3)(a) and 81(1).
[32] Rule 73(3)(b).
[33] Rules 73(3)(c), 74(1) and Rule 38(4).
As to the second type of order, it is common ground that the power conferred by rule 73(3)(b) to authorise a plaintiff to proceed with an action despite the non-participation of a person jointly entitled does not alter the substantive law by severing the unitary cause of action, and in particular does not entail one of two joint land owners recovering a portion of the total damages suffered by the joint owners reflecting the plaintiff’s proportionate undivided moiety in the land. However, rule 73(3)(b) is silent as to whether, and if so how, the other person is bound by the result of the action if an order is made under that paragraph. It may be that the other person would be bound by the result under common law principles of res judicata and merger of rights in judgments. However, the parties did not make detailed submissions on these questions and regarded them as complex and difficult.
As to the third type of order, it is common ground that the Court under the Rules retains the historical power to join a non-consenting joint right holder as a co‑defendant.
Construction of statement of claim
The first issue I am required to determine, against the background of the procedure contained in the Rules, is whether, when he instituted the action in December 2010, Mr Proude claimed for damage to land owned by him jointly with Mrs Proude.
Mr Visic contends that there are two indicia in the original summons and statement of claim that Mr Proude was not making such a claim. The first is that he did not join Mrs Proude as a party to the action and did not seek directions pursuant to rule 73(3) of the Rules. The second is that he attached to the original statement of claim an annexure listing Group Members and the annexure included “Proude, RD & L”. I address these contentions in turn.
Non-joinder of Mrs Proude as a party
Under the Rules, on claiming for damage to jointly owned land, Mr Proude ought either to have joined Mrs Proude as co-plaintiff or to have applied for directions pursuant to rule 73(3) of the Rules. By reason of rule 77(1), his failure to do so did not render the action a nullity insofar as he was claiming for damage to the jointly owned land, but his failure is one indication that he was not making such a claim.
Inclusion in annexure of Mr and Mrs Proude
I have concluded at [34] above that the annexure lists Group Members inclusive of claims brought by Mr Proude in his own right. The mere fact that Mr and Mrs Proude’s name appears in the annexure is not in itself an indication that Mr Proude was claiming for damage to the jointly owned land in a representative capacity pursuant to rule 81 of the Rules and not in his own right.
Other indicia
Paragraph 18 of the original statement of claim read as follows:
By reason of the Fire, … the Plaintiff … sustained property loss and/or damage.
Paragraph 18 was not expressed to be limited to damage to property owned solely by Mr Proude or to exclude damage to property owned by Mr Proude jointly with Mr Proude. On its face, it included all loss and damage suffered by Mr Proude to property owned by him (whether solely or jointly).
It is an inherently unlikely intention to impute to Mr Proude that he intended to claim for damage to the 1,065 hectares which he owned solely in his own name but not to the 335 hectares which he owned jointly with Mrs Proude. I have found at [35] above that, by paragraphs 18 and 26 of the original statement of claim, Mr Proude was pleading the loss of all personal property situated, and the loss of profit from the entire farm business conducted, on the entire 1,400 hectares of Proude land. It would be incongruous for Mr Proude to claim for such loss, but not to claim for damage to that part of the land which he owned jointly with Mrs Proude.
The construction of the statement of claim advanced by Mr Visic is that Mr Proude intended to treat the claim for damage to the land owned by him jointly with Mrs Proude as part of the representative action on behalf of neighbours and strangers. It appears incongruous that Mr Proude was claiming in his own right for all damage suffered by him except damage to land he owned jointly with Mrs Proude, which he intended to claim only as a representative of Mrs Proude and himself.
In all of the circumstances, on the proper construction of the summons and statement of claim, Mr Proude was claiming for damage to all land owned by him, whether solely or jointly with Mrs Proude.
Appropriate order in the circumstances
By reason of rule 77, the failure of Mr Proude to join Mrs Proude as a party to the action does not render the claim for damage to the jointly owned land a nullity. However, an order in one form or another should be made to ensure that Mrs Proude is bound by the result of the action.
Mrs Proude does not consent to be joined as a co-plaintiff. However, despite an invitation to do so, she declined to file affidavit evidence explaining her attitude or the reasons for it.
The parties take different positions as to the order which ought to be made in the circumstances in which I concluded that Mr Proude had instituted the action claiming for damage to the jointly owned land. Mr Proude contends that the appropriate order is:
1.an order pursuant to rule 73(3)(b) authorising him to maintain the action claiming damage to the jointly owned land despite Mrs Proude not being a party; or
2.alternatively, an order joining Mrs Proude as a co-defendant to the action.
Mr Visic contends that the appropriate order is:
1.a stay of the action; or
2.alternatively, an order joining Mrs Proude as a co-defendant.
The CFS does not adopt an adversarial position on the issue, but contends that the appropriate order is an order joining Mrs Proude as a co-defendant.
Each party expressly says that they do not oppose an order joining Mrs Proude as a co-defendant, albeit that is not the first preference of Mr Proude or Mr Visic.
In all of the circumstances, the appropriate order is to join Mrs Proude as a co-defendant. This is preferable to authorising Mr Proude to proceed with the action despite Mrs Proude not being a party (as sought by Mr Proude) for two reasons. First, she has not explained her attitude or the reasons for it. Secondly, for the reasons given at [55] above, I am not satisfied that, if such an order were made, Mrs Proude would necessarily be bound by the result of the action.
It is not appropriate to stay the action (as sought by Mr Visic) because I have concluded that Mr Proude instituted the action claiming for damage to the jointly owned land and an order in one form or another ought to be made to enable the action to proceed and ensure that Mrs Proude is bound by the result.
Exposure to risk of adverse costs order
It is well established that, in certain circumstances, a non-party is amenable to an order, made at the conclusion of an action, to pay some or all of the successful party’s costs of action.[34] If Mr Visic and/or CFS are ultimately successful in the action in respect of the claim for damage to the jointly owned land, it might well be appropriate that an order be made that Mrs Proude pay at least part of the successful defendant’s costs of action. This would depend upon the exercise of a discretion at the conclusion of the action taking into account all of the relevant circumstances.
[34] Knight v FP Special Assets Ltd [1992] HCA 28; (1992) 174 CLR 178 at 192-193 per Mason CJ and Deane J (Gaudron J agreeing) and 203 per Dawson J; Vestris v Cashman (1998) 72 SASR 449 at 452 per Olsson J and at 462 per Lander J.
Conclusion
By instituting the action in December 2010, Mr Proude claimed for all loss and damage suffered by him as a result of the fire, including loss of and damage to personal property and losses of the business owned by him as trustee of the Trust and including damage to the land owned by him jointly with Mrs Proude.
In the circumstances, it is unnecessary and inappropriate to make any order permitting Mr Proude to further amend the summons or statement of claim in respect of the claim for loss of personal property and losses of the business owned by Mr Proude as trustee of the Trust.
In the circumstances, it is appropriate to join Mrs Proude as a co-defendant.
I will hear the parties as to the precise orders to be made.