Selective Crash Repairs Pty Ltd v Victoria Wool Processors Pty Ltd (No 2)

[2004] VSC 479

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

No. 4696 of 2002

SELECTIVE SMASH REPAIRS PTY LTD (ACN 006 350 170)	Appellant/Plaintiff
v
VICTORIA WOOL PROCESSORS PTY LTD (ACN 050 032 356)	Respondent/Defendant

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JUDGE:	HARPER J
WHERE HELD:	MELBOURNE
DATE OF HEARING:	28 OCTOBER 2004
DATE OF JUDGMENT:	24 NOVEMBER 2004
CASE MAY BE CITED AS:	SELECTIVE SMASH REPAIRS PTY LTD v VICTORIA WOOL PROCESSORS PTY LTD (No. 2)
MEDIUM NEUTRAL CITATION:	[2004] VSC 479

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PLEADING – Nuisance – Claim that plaintiff unable to move part of its business to site subject to nuisance – Date of decision not to relocate - Limitation period.

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APPEARANCES:	Counsel	Solicitors
For the Appellant/Plaintiff	Mr W. Houghton QC with Mr P. McDermott	Battley & Co Pty Ltd
For the Respondent/Defendant	Mr I. Stewart	Allens Arthur Robinson

HIS HONOUR:

1. On 28 October I heard an appeal from Master Wheeler in this matter.  I gave judgment on that appeal on 16 November.  I did not then, however, deal with an issue which was touched upon during the hearing of the appeal but, given the time constraints of the Practice Court, was then held over on the basis that I would give a ruling on it after considering the relevant written submissions of each side.  That consideration is now complete.  My ruling follows.

1. By its amended statement of claim, the plaintiff alleges (in effect) that in April 1990 it acquired the land at 23 Little Boundary Road, North Laverton that is the subject of its present claim in nuisance against the defendant.  Its intention was not only to commence operating an automobile wrecking business from the new premises (something which in fact it did, commencing in July 1991) but also to transfer to those premises the automobile smash repair business which since October 1983 had been conducted by it, first at 720 Geelong Road, Brooklyn and subsequently (from December 1984) on property owned by the plaintiff or an associated company at 749 Geelong Road in that Melbourne suburb. 

1. In readiness for the commencement of its smash repair operations at North Laverton, the plaintiff constructed on that site a purpose-built workshop.  This housed the  capital equipment, such as a hoist and washing bay, required for that branch of the business.  All was in readiness for the commencement of its operations; and then, on 1 November 1991, the (alleged) pollution began. Dust and air-borne fibres from the defendant’s premises next door (at 21 Little Boundary Road) were blown across to No. 23.  The plans to relocate were put on hold.  In the meantime, therefore, the smash repair department remained in Brooklyn.

1. The proposed transfer, had it taken place, would have saved the plaintiff money; or so the amended statement of claim alleges.  Both the auto-wrecking and the auto-repair strands of the plaintiff’s total business would have been conducted from the Laverton premises, with all the economies that would have resulted from that physical consolidation.  But the transfer has never eventuated.  Geelong Road, Brooklyn has therefore remained as the site from which the plaintiff has effected its automobile repairs.  As a result, the plaintiff has not been able to avoid expenditure that, given a common location at North Laverton, would have been unnecessary: $36,000 in 1993; $42,000 in the following year; and $60,000 in 1995.  Not only that, but additional land was needed at Brooklyn “to cope with the space shortage … that was intended to be resolved by moving to the [North] Laverton premises.” [1]  Accordingly, in December 1992 a company named Rosemary Quest, which is owned and controlled by directors and shareholders of the plaintiff, purchased 747 Geelong Road, North Laverton.  This, as the amended statement of claim alleges, “created further unnecessary overheads and inefficiencies in the business.”[2]

   [1]Particular (v) to para. 8 of the amended statement of claim.

   [2]Ibid.

1. The defendant contends that the case thus pleaded is one that gives rise to a single, compelling inference: that by the time the decision to acquire 747 Geelong Road was made, if not earlier, the plaintiff had committed the future of its smash repair business to that site to the exclusion of the North Laverton property.  Furthermore, the defendant submits, the plaintiff’s answers to interrogatories confirm the correctness of the inference to which the pleading gives rise.  These answers (in particular, the answer to interrogatory 4) reveal that, in 1993, the plaintiff carried out capital works on its newly-acquired Brooklyn land.  It follows, so the defendant argues, that the plaintiff had by then made an irreversible decision to persist with Brooklyn not as a source of rental income (as once proposed) but as the site from which for the indefinite future its smash repairs would be carried out.  This conclusion is given added credence by another answer to another interrogatory (interrogatory 44) in which the plaintiff was asked why the two branches of its business had not after 1 November 2002 been consolidated at North Laverton.  In response, the plaintiff stated that it had “injected capital elsewhere to ensure the continued operation of its business.  Those investments”, the answer continued, “cannot be readily reversed, as the investments were geared to the needs of the business at the time they were made.”

1. On this evidence, and on the case as pleaded, only one conclusion is – according to the defendant – open.  Back in 1992, or at the latest in 1993, the plaintiff had abandoned all hope of consolidating at North Laverton both its smash repair and its auto-wrecking businesses.  It had committed itself to a divided operation.  This aspect of its claim against the defendant  - this cause of action – was, by then, therefore complete.  The limitation period had begun to run.  The plaintiff had six years thereafter within which to commence proceedings.  That period expired, at the latest, some time in 1999.  But these proceedings were not begun until 2002.  Those portions of the amended statement of claim that plead the cause of action in question should be struck out accordingly.

1. The plaintiff submits that all this is misconceived.  It begins with the proposition that the cause of action is in nuisance.  The claim can therefore be made at any time within six years after the nuisance abated.  According to the plaintiff, that is what happened in this case.  The nuisance continued until late October 2002.  The proceeding was instituted in March that year; and the amended statement of claim was filed on 16 October 2003.  The limitation period, therefore, is not a problem.  In any event, the Court should not at this stage embark upon an examination of what will be disputed questions of fact.  The date on which the plaintiff committed itself to the continued use of the Brooklyn land as the site on which it conducted its smash repair business may be, and probably is, the subject of just such a dispute.

1. The latter point troubles me; the former does not.  Once it is established that the plaintiff had made a firm decision to continue into the foreseeable future its smash repair business in one location and its vehicle wrecking business in another, and  once consequential damage had been suffered,[3] the cause of action was in my opinion complete.  It does not seem to me that the decision upon which the plaintiff relied in support of its position on the limitation argument – Clutha Ltd v Millar (No 3)[4] - stands in the way of my conclusion.  That being so, the only question is whether the plaintiff’s decision to keep its smash repair business at Brooklyn had indeed been made by 1993.

   [3]It seems to be clear, from the allegations contained in the amended statement of claim, that consequential damage followed immediately, or almost so.

   [4](Unreported) [2002] NSWSC 642.

1. It seems to me that I cannot answer that question by reference to the plaintiff’s answers to interrogatories.  The evidentiary landscape may change.  It may be that, when the case comes to trial, the plaintiff will (for example) seek to put a particular slant on what it meant by the phrase “cannot readily be reversed” which, I relation to the decision to stay put, it employed in its answer to interrogatory 44.

1. It follows that the defendant cannot succeed in its application to have the relevant portions of the amended statement of claim struck out unless that pleading contains an allegation or admission that the decision to retain the smash repair segment of the business at Brooklyn was made more than six years before the issue of the writ by which this proceeding commenced.  But it seems to me that it does not unequivocally go so far as that.

1. The time for equivocation has passed.  The plaintiff must fix upon the date by which, in truth, the decision to keep the smash repair business in Brooklyn was reached.  If that date is less than six years before the institution of this proceeding, then the statement of claim should be amended to explicitly plead that allegation.  Any claim for consequential damage should be framed with the limitation period in mind.  If the decision was made outside the limitation period then, given that the defendant will take the point, no purpose would be served in pursuing this aspect of the plaintiff’s case.  In that eventuality, the statement of claim should be amended to remove it.

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