Taylor, Ex parte - Re Patterson

[2000] HCATrans 368

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S38 of 2000

B e t w e e n -

MICHAEL CHRISTOPHER NIXON, ALEX TALAY, ROBERT MILNE, VICTOR BRUCE WILLIAMS, SANDRA SHEPHARD and GREGORY DURKIN (for themselves and as representing the persons referred to in paragraph 1 of the Statement of Claim)

Applicants

and

PHILIP MORRIS (AUSTRALIA) and PHILIP MORRIS LTD

First Respondents

W.D. & H.O. WILLS HOLDINGS LTD and W.D. & H.O. WILLS (AUSTRALIA) LTD

Second Respondents

ROTHMANS HOLDINGS LTD and ROTHMANS OF PALL MALL (AUSTRALIA) LTD

Third Respondents

Application for special leave to appeal

GLEESON CJ
KIRBY J
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT BRISBANE ON WEDNESDAY, 21 JUNE 2000, AT 12 NOON

Copyright in the High Court of Australia

____________________

MR T.K. TOBIN, QC:  May it please your Honours, I appear with MR J.B.R. BEACH, QC and MR B.F. QUINN, for the applicants.  (instructed by Slater & Gordon)

MR A.C. ARCHIBALD, QC:  May it please the Court, I appear with my learned friend, MR S.A. O’MEARA, for the first respondents, the Philip Morris Company.  (instructed by Arthur Robinson & Hedderwicks)

MR C.G. GEE, QC:  May it please your Honours, I appear with my learned friend, MR D.F.R. BEACH, for the second respondents, the Wills group.  (instructed by Mallesons Stephen Jacques)

MR S.G. FINCH, SC:  May it please your Honours, I appear with my learned friend, MR I.M. JACKMAN, for the third respondents, the Rothmans group.  (instructed by Clayton Utz Lawyers)

GLEESON CJ:   Yes, Mr Tobin.

MR TOBIN:   Your Honours, this matter arises from a decision of the Federal Court, the Full Court, which declared that it was not appropriate that the claims of applicants, the applicants here, be pursued by representative proceedings and ordered that the Part IVA proceedings by the applicants be discontinued.

GLEESON CJ:   There were two aspects of the decision of the Full Court of the Federal Court.  First of all, it struck out a further amended statement of claim and then it refused leave to replead.

MR TOBIN:   Yes.

GLEESON CJ:   Is it against both of those aspects that you wish to appeal or only the second one?

MR TOBIN:   Your Honour, we want to appeal against the decision of the court, both to strike out the statement of claim and to order that the Part IVA proceedings not continue, but the ‑ ‑ ‑

GLEESON CJ:   Obviously the second question does not arise if you succeed on the first question.

MR TOBIN:   Yes, your Honour.  But the real issue, as we see it, is that the threshold requirement of section 33, under Part IVA, will always be required to be disposed of, if it be challenged, by a pleading issue.  In other words, it is not accurate to describe the issue between the parties as a pleading issue.  The issue between the parties really goes, as we would concede it, your Honours, to the threshold provisions of section 33C ‑ ‑ ‑

GLEESON CJ:   When you say “the issue”, there were a number of grounds on which the statement of claim was struck out, including grounds relating to inconsistency of allegations within the statement of claim and incomprehensibility of the case sought to be made out.

MR TOBIN:   Yes.  Well, your Honours, perhaps I should come to that question because it seems to have driven the decision of the Full Court and as we would understand it, their Honours took a view that this type of action that we wish to bring was not appropriate for representative proceedings.  That seems to be the sub-text.  I say that with respect to their Honours but that seems to be the sub-text of the judgment as they came out.

KIRBY J:   The decision was before Wong v Silkfield, was it not?

MR TOBIN:   Yes, it was, your Honour.  Your Honour, the way the applicants put their cases, and on behalf of the group members, is as follows.  Not as a classic section 52 Trade Practices case where there is a representation and a reliance and an argument about causation as to damage.

GLEESON CJ:   You said the decision was before the High Court’s decision in Wong v Silkfield.

MR TOBIN:   I am sorry, it was after, your Honour.

GLEESON CJ:   Yes.  That appears from page 1078, line 12.

MR TOBIN:   I am sorry, your Honour.  I should apologise to Justice Kirby.  Your Honours, the way we want to put the case is this, that the tobacco manufacturers or distributors, the respondents, over a period of some 30 or 40 years, engaged in conduct which, under the Trade Practices Act, was unlawful.  That conduct was misleading or deceptive, on our case.  In various aspects, but at the heart of our case, your Honours, is that at all times they purported to recommend their product as beneficial and pleasurable and to deny or denigrate the body of science that, on our case, demonstrated that smoking of tobacco was a serious health risk.

That conduct is conduct over some 30 or 40 years and there are some aspects of that conduct, your Honours, which, whatever the range of instruments whereby the conduct was carried out, that is, whether it be advertisements; whether it be lobbying of government; whether it be public statements to the media; throughout all of those aspects of the conduct of the respondents they never, at any time, in any of the conduct or acts of representation to the public, admitted that smoking was a risk to health.  That science runs through the whole of the conduct of the respondents.  On our case, there will be not one item of evidence to refute that.

GLEESON CJ:   Unfortunately, you have to actually plead your case and on page 1081 under the heading “Flaws in the Pleaded Case”, Justice Sackville, with whom the other members of the court agreed, set out a number of fairly trenchant criticisms of what was apparently about the tenth or the eleventh go at formulating a statement of claim.  Now, what was before the Full Court was a pleading summons and you want leave to appeal to this Court on the pleading summons.  If we grant you leave then we are going to have to deal with each and every one of these criticisms of the pleading.  So, what are your answers to the criticisms made of the pleading?

MR TOBIN:   Well, your Honours, perhaps if I go to the major criticism which is that we do not comply with sections 33C(1)(a) of the Federal Court Act, whereby “every group member” – I am reading from his Honour’s judgment at paragraph 141, page 1082:

every group member must have a claim against the respondent or (if there are more than one) all respondents.

Now, that attack on the pleading by their Honours, on 33C(1)(a), especially by Justice Sackville, is, on our case, without foundation and the pleadings ‑ ‑ ‑

GLEESON CJ:   But you are not attacking the proposition that you have to have a claim against all respondents.  That was expressly accepted and that is accepted here.

MR TOBIN:   It is, your Honour, yes.  We accept that there must be a claim against each of the respondents by every group member.  But the pleadings of it, your Honours, are in volume 1, and they are, as we would see it, quite clearly, if I can bracket the three ways in which we pleaded the conduct against every respondent, we plead it in paragraph 14 and 15, and I will take your Honours to that in a moment at page 75 of the application book, we plead if as a section 75B case of accessorial liability – that is in paragraph 20 – and we plead it in paragraph  24 at common law that the respondents were “jointly liable for the breaches of duty” and that they engaged in a common purpose of:

preventing the dissemination of information which would discourage the smoking of cigarettes;

That is at 85 and 86.  So that there were three ways, your Honours, in which we alleged against the respondents that each of the respondents was liable with regard to every group member.  If I could illustrate it, your Honours, without travelling into the facts too much, the silence of every respondent over a period of 40 years is an operative factor, with regard to the risk to health, that we say, and we want to make a case, would operate on each and every group member.

GLEESON CJ:   What do you say to paragraphs 143 and 144 of Justice Sackville’s judgment?

MR TOBIN:   Your Honours, with respect to his Honour, we reject them.  What happened during the course of the appeal was that their Honours picked up a phrase from Mr Justice Wilcox where he referred to our case – in fact, it is quoted, your Honour, at 141 of his Honour’s judgment, about the fourth line – in essence, according to his Honour, that is Mr Justice Wilcox:

the applicant’s case is that the respondents embarked individually and collectively on a course of conduct designed to create a false community perception about the risks of smoking.

Your Honours, we never had, nor do we ever need a case, of collective conduct.  What Mr Justice Wilcox said, and we do not resile from it, is that the conduct which we impugn, is both the individual conduct of individual respondents and, in some instances, collective conduct; the conduct of all three.  But we rely, your Honours, not upon a need to establish a case, as it were, in conspiracy – we could have pleaded a count of conspiracy if that would, as it were, get around the requirements of 33C(1)(a).  But we did not do that.  We pleaded it in three ways.  As I have said to your Honours, we have pleaded it in paragraph 14.  If I can just take your Honours briefly to the verbiage of the pleading.  At page 75 of the appeal book, paragraph 14 alleges, and this is a paragraph of definition:

During the relevant period, each of the Respondents engaged in conduct promoting the benefits and pleasures of smoking and denying or minimising the risks associated with smoking, the purpose of which was to encourage consumers including the class members to smoke the cigarettes –

that is “the conduct”.  Then there follows, your Honours, in 14(A), instances of the conduct of each respondent in advertising; 14(B), of advertising and healthier cigarettes.  In 14(C), on page 77, of making public statements; minimising the risk to health.  In 14(D), lobbying governments.  Again, an activity, your Honours, which we would understand.  The extent to which the lobbying of government could be found to minimise the extent to which the public knew of the risk of smoking, that would be something operating on all group members; and 14(E) is the allegation of silence, which I referred your Honours to.  Paragraph 15 is one analysed by Mr Justice Sackville, and with respect to his Honour, we disagree with his conclusion.  Paragraph 15 says “The class members were influenced by the conduct”.  That is the conduct of each of the respondents set out in paragraph 14 and defined in paragraph 14.  So, when his Honour analyses paragraph 15 in paragraph 148, your Honours, at 1084, line 15:

Paragraph 15 alleges that the group members were influenced by the conduct, either directly or indirectly, to smoke, continue to smoke…..  There is no indication in the pleading of which respondent’s conduct influenced particular class members to take the action, let alone which conduct of a particular respondent allegedly influenced particular group members.

Now, your Honours, his Honour says, with regard to paragraphs 14 and 15, that they do not plead a claim against every respondent.  With respect to his Honour, as I read 14 and 15, it necessarily conveys the meaning that the class members were influenced by the conduct of each of the respondents, and that is the way we put our case, which is ‑ ‑ ‑

GLEESON CJ:   A question is whether they were influenced by the conduct of all the respondents, is it not?

MR TOBIN:   Yes.

GLEESON CJ:   And that is the problem that is examined in paragraph 149.  It is examined as a problem of expression of the pleading.

MR TOBIN:   Well, your Honour, as I have read the pleading to your Honours on 14 and 15 ‑ ‑ ‑

KIRBY J:   If it is the expression of the pleading, is it something that ought to have been the subject of an entitlement to replead?

GLEESON CJ:   How many times had you repleaded it already?

MR TOBIN:   Well, your Honour, that is a harsh criticism made by the court, but an analysis of the way the pleading proceeded does not give a foundation for that ‑ ‑ ‑

GLEESON CJ:   I have in mind what Justice Hill said about this in his reasons at page 1044, paragraph 16.  You really do need to address that because I should have thought it is very relevant to the question of leave to re-plead.

MR TOBIN:   Your Honours, we have a schedule of the pleadings.  I do not know that that is necessary to give your Honours.  We have set out in our reply the answer we make to that assertion and that is at 1176.  Among the various amendments were, for example, the consolidation of the Durkin and Nixon proceedings which had commenced independently and they are now part of these proceedings.  There were amendments of the most trivial kind involving grammatical changes ‑ ‑ ‑

GLEESON CJ:   That is what pleading summonses are all about.  What do you say about what Justice Hill says in paragraph 16 in the fourth sentence, which is an assertion about what went on during argument before the Full Court?

MR TOBIN:   Well, your Honour, before the Full Court, counsel was – a dialogue went on before the Full Court which, in general, Mr Nettle did not concede, in substance, complaints that were made by the respondents, and which were put to him by the court.  Your Honours, it is not possible, on this occasion, to analyse, in depth, the argument about the pleadings.  We say all that we can say in our written submission about that in reply to the other side.  But what has happened in the case itself, your Honours, is that section 33C(1)(a) and section 33C(1)(b) have been the subject of findings of the Full Court which had the consequence, the pleading aside, of disposing of this matter as a representative proceeding.

If I could put the, perhaps, simplest point at the outset, there is no way that the tobacco litigation will continue as individual proceedings.  It is financially impossible and, indeed, it would be impossible for the court system to maintain such an approach.  We said in the Full Court, and we say to your Honours, that this is a matter of great public interest and importance, the question of the tobacco litigation.  It can only be done by way of representative proceedings.  We have the, indeed, quite harsh criticisms of the way their Honours disposed of the collective conduct issue. 

We have three independent forms of pleading, for example, a pleading of section 75B of aiding and abetting, and without deciding the issue, their Honours disposed of that part of our case by doubting whether it would be sufficient to import the necessary element into section 33C(1)(a).  Now, your Honours, we say on behalf of the applicants that the decision of the Full Court in precluding representative proceedings in effect truncates the operation of Part IVA and it truncates the operation of section 52.

KIRBY J:   Justice Sackville would have given you leave to replead.

MR TOBIN:   His Honour would, yes.

KIRBY J:   How many parties are represented in the proceedings, approximately?

MR TOBIN:   There are three entities on the respondent’s side, your Honour ‑ ‑ ‑

KIRBY J:   I know that, but how many on your side?

MR TOBIN:   Well, there are three surviving and three deceased applicants, and it is difficult to put a figure on it ‑ ‑ ‑

KIRBY J:   Is it feasible for the surviving applicants to commence again their proceedings and to pursue the respondents?  One would think not.

CALLINAN J:   Why do you say that?  Why do you say it is not feasible?  They do not have the money, is that the reason?

MR TOBIN:   Yes, certainly, that ‑ ‑ ‑

CALLINAN J:   There is no other reason.

MR TOBIN:   There is another reason, I suppose, and it is this, to be frank about it.  For an individual plaintiff to take on the tobacco companies while suffering from a terminal disease is, in the lingo, a big ask, and it is not a

realistic ask, with respect, your Honour, because individual plaintiffs, in those circumstances, are probably unlikely to see the outcome of their own litigation.

CALLINAN J:   But that, unfortunately and unhappily, does occur.  It is not a reason for construing legislation in a different way from the way in which it should be construed.

MR TOBIN:   No, I accept that, your Honours.  We say that the legislation should be construed beneficially and we set that out in our reasons.  If it is not, and if this decision stands, then, in practical terms, that would end the remedies available to the litigants in this case.

GLEESON CJ:   Thank you, Mr Tobin.  Yes, Mr Archibald.

MR ARCHIBALD:   If the Court pleases, in our submission the foundation of the Full Court’s decision was that fundamental flaws existed in the pleading that was ultimately propounded by the applicant.  Once those pleading flaws were identified, in our submission, it was abundantly clear, indeed inevitable, that as a consequence the salient requirements of Part IVA were not satisfied.  The conclusion that the features of Part IVA were not satisfied did not depend upon any unorthodox or new appreciation or understanding of the operation of section 33C.

KIRBY J:   But it could scarcely be denied that the issue is one of general public interest and importance.

MR ARCHIBALD:   In our submission, not.  The issue is, was the particular pleading before the Full Court one which was defective such that it could be struck out.

KIRBY J:   There are two questions.  One, whether it should be struck out with leave to replead and, secondly, if that is refused, whether it is a matter within the interests that would attract the special leave of this Court.

MR ARCHIBALD:   Yes, your Honour, but the ‑ ‑ ‑

KIRBY J:   Why was not Justice Sackville right in the approach that he took relating to the right to replead?

MR ARCHIBALD:   Justice Sackville concluded that there was considerable force in the argument that leave to re-plead ought not be given.  His Honour considered various salient elements and, on balance, concluded that there was a case for repleading.

KIRBY J:   That is usually what happens in pleadings.  With people who are in a terminal condition it would normally be something, I would think, that would be done because the realities are that for them to mount an entirely fresh case and individual cases is really not on.  So, effectively, this puts them out of court, out of the Australian court system.

MR ARCHIBALD:   But two things might be observed.  First, what is the utility of repleading of this particular case?  There is no barrier to the pleading and institution of proceedings in respect of another case, either individual claims or some form of representative proceeding.  The question is, should there be leave to replead this case?

KIRBY J:   An individual case to take on the respondents and all of them.  I mean, that is the whole point of Part IVA.

MR ARCHIBALD:   One might expect a plurality of individual cases and one might envisage a form of representative proceeding.  But the question is, can this representative proceeding continue, and the majority concluded, we submit without error, that there would not be an occasion for re-pleading because there was nothing proffered to the Full Court to suggest or indicate that any formulation of the claim could be made, or would be made, that would eliminate the fatal flaws that had been identified by the court.

GLEESON CJ:   Well, in the silicone breast implant litigation in the Supreme Court of New South Wales, all the plaintiffs sued individually, but the claims were case managed and various issues were decided.  Issues that were common to the cases were decided by the judge who was case managing the case.  There is nothing unusual about individual claimants, whose individual positions vary substantially in relation to particular aspects of their claim, suing in groups and having their cases managed.

MR ARCHIBALD:   Yes, and there are ‑ ‑ ‑

KIRBY J:   Does New South Wales have a provision equivalent to Part IVA?

MR ARCHIBALD:   Not in identical form, no.

GLEESON CJ:   Which is exactly why they were not pursued as a class action.

MR ARCHIBALD:   But Victoria does.

GLEESON CJ:   There are many actions on foot, as I understand it, in Supreme Courts around the country at the moment where claims are being made by large groups of individuals but suing individually.

MR ARCHIBALD:   Yes, and resourced in the way in which a representative proceeding is often resourced.

KIRBY J:   We do not have those before us.  We do have these present applicants.

MR ARCHIBALD:   Yes, we do.  So, we say there is nothing in the material to show that there was real utility in repleading of this case.  There had been many opportunities offered to the applicants, both before the hearing in the Full Court and during the hearing in the Full Court, and nothing was forthcoming to suggest that any of the fundamental flaws were susceptible of being overcome.  The second matter to which Justice Sackville addressed his attention in particular, was the prospect that some members of the class might find that their claims became statute barred because they might be unaware of the cessation of the representative proceedings.

Now, as a postulation, one might accept that.  One does not know whether there are people in that category; how many there are.  One does not know whether they knew that the representative proceeding had, in fact, been instituted.  But if there is weight in that point, our submission is that it is suggestive of the desirability of publicising the sensation of the proceeding rather than to mandate some further endeavour to breathe life into the pleading corpse.  If publicity is the issue, in relation to cessation, then, of course, that can be coped with in a variety of ways.  But it does not present itself as a powerful reason to allow the applicants, yet again, to have a tilt at something in respect of which they have offered ‑ ‑ ‑

KIRBY J:   I would not agree with that.  I think the powerful reason is not other parties, it is the applicants before the court; the fact that they are said to be in a very serious health condition; the unreality of thinking that they can recommence individually against the respondents and, therefore, the effective decision which is made by this Full Court opinion that puts them out of court on a pleading point on a matter of general public importance.

MR ARCHIBALD:   There is no bar to the individual applicants repleading their case, those who survive.  There is no bar to other individual applicants resourced in the way in which other litigation, to which reference has been made, is resourced, and there would seem to be no barrier to some form of representative proceeding – less ambitious, less encyclopaedic, than that which is attempted here being formulated and, perhaps, being able to be conducted satisfactorily.  So that, it is not the case that there is no alternative but to leave forever this field of litigation on the footing that it is incapable of being instituted ‑ ‑ ‑

KIRBY J:   We are not talking about a field of litigation, we are talking about particular citizens of our country who have come to the court system.  If Part IVA does not work in this case, as it may well not, then that is a very important question and this Court should pass on it.

MR ARCHIBALD:   Nothing in the Full Court decision, in our submission, involves a conclusion that Part IVA cannot work in this area.

KIRBY J:   Well, if it could, they ought to have allowed re-pleading as Justice Sackville favoured.

MR ARCHIBALD:   But for the reasons we have urged, we submit the majority are right or at least cannot be shown to have been in error in the exceptional way which would be required before this Court would allow special leave in respect of those matters.  We submit that the reasoning of the majority, on that point, is not vitiated by any error of principle and that their conclusion is not such an affront to justice that one could find a proper foundation for special leave being granted.  Once the failure to plead collective action, or by whatever name it goes, but once there was an observed failure to plead activity by the respondents which would found a claim by each respondent, by each applicant, and each member of the class against each respondent, it was inevitable that paragraph (a) of section 33C(1) was not satisfied.

In relation to paragraph (b) of that section, the court again reached its conclusion on what we submit is an unexceptionable view of that paragraph, having regard to the pleading before the court.  The court adopted the analysis in Zhang’s Case, which is not challenged by the applicants before this court, and the court did not find it necessary to decide, and did not decide, whether paragraph (c) of section 33C was satisfied.  So that, if one looks at the special leave points sought to be raised by the applicants, and if one looks at the grounds in the draft notice of appeal raised by the applicants, there is, in our submission, no controversy in relation to that section which casts any doubt at all upon the conclusion of the court.  In relation to the reasoning of the court in respect of leave to replead, we submit no error is to be found in the decision of the majority.  For those reasons, in our submission, special leave should be refused in this matter.

GLEESON CJ:   Thank you, Mr Archibald.  Yes, Mr Gee.

MR GEE:   Your Honours, we respectfully adopt the submissions of our learned friends for the first respondent and wish to add only the following further submissions.  First, although it is plain from what has passed from the Bench, within the contemplation of your Honours, we do specifically refer the Court, with respect, to paragraphs 171 to 178, inclusive, of the reasons for judgment of Justice Sackville, in which he considered the pleading as a pleading entirely independently of Part IVA.  That is made clear by the opening words of his paragraph 171, culminating in what he said in paragraph 178, namely that, quite independently of any question aof Part IVA, the statement of claim would, in whole or in part, be liable to be struck out.

That is the first specific area to which we would draw attention.  That, of course, was the subject of agreement by the other members of the Bench and no question, in our respectful submission, attracting the special leave requirements for the court is shown.  Second, on the question of re-pleading, we respectfully take the Court to the last part of the judgment of Justice Hill, particularly at the very bottom of 1045 of the application book, your Honours, but, particularly, throughout 1046, where his Honour discussed the arguments in favour of denying liberty to replead and basing them upon the affirmative proposition revealed at line 29 that it would not be in the interests of justice - it might actually produce injustice to:

permit the present proceedings to continue by allowing the applicants once again to attempt to replead their case.

KIRBY J:   We will never know because they were not afforded that opportunity by the majority.

MR GEE:   Your Honour, for present purposes, we respectfully submit that there is an affirmative case articulated by his Honour for the proposition that justice is done by doing what was done by the Full Court, not merely a negative case, and we respectfully rely on it.  The arguments set forth by his Honour, in our submission, are persuasive and ‑ ‑ ‑

KIRBY J:   Is the fact that the applicants are very sick and may not survive to prosecute the proceeding if they were forced to recommence completely an irrelevant consideration?

MR GEE:   Your Honour, may I say two things?  First, there is no question of the three named applicants or the estates of the three deceased applicants having to start again.  No one suggested that their applications, as applications, are struck out.  They were expressly given leave to re-plead their individual cases.  Secondly, as I think ‑ ‑ ‑

KIRBY J:   That is to say that IVA does not work in their case and that is itself, it seems to me, at least subject to your argument, to be a very important question because if it does not work in a case like this then the Parliament ought to know about it.

MR GEE:   Your Honour, I was, with respect, seeking to answer your Honour’s question about the actual named applicants or their estates in relation to whether the fact that they were ill was relevant.  That I took to be your Honour’s question and I was seeking to answer it, first, by showing that there was no question about them having to recommence and, secondly, ill though they are, as Justice Callinan observed in a slightly different context, that is what happens in cases brought before courts from time to time.  Courts, may I respectfully suggest, have ways of dealing with that such as by expediting cases calling for such treatment.

KIRBY J:   The answer that the court system offers in this case is not to expedite proceedings or to lay down strict requirements on re-pleading, it is to put them out of court on a claim under Part IV for a representative proceeding.

MR GEE:   But not out of court, your Honour, in respect of their claims ‑ ‑ ‑

KIRBY J:   Not out of court but out of court under the facultative provisions.

MR GEE:   I am sorry, I have talked over your Honour.  I do apologise.

KIRBY J:   They are put out of court under the provisions that are reformatory provisions which, at least on my understanding, were enacted precisely for cases such as this.

MR GEE:   Your Honour, I believe, with respect, I would be repeating myself if I put a further submission in relation to that.

CALLINAN J:   They would have had their cases heard by now if they had proceeded as individual cases, would they not?

MR GEE:   That is possible, your Honour.  I would not say affirmatively so, but there has been a great deal of time pass while a case which the Full Court has now held is, in effect, not pleadable ‑ ‑ ‑

CALLINAN J:   When was the first of these proceedings started?

MR GEE:   The 16 April 1999.

KIRBY J:   That is not all that far back.

MR GEE:   No.

KIRBY J:   By the standards that we see in this Court from time to time, it is quite recent.

CALLINAN J:   Fourteen months, you get expedition.  I do not know what the situation is in the south, but you would certainly get expedition and get a hearing within 14 months in Queensland in an appropriate case.

MR GEE:   Your Honours, there is also the other face of the coin which is that, although the representative action was started at the date I have given, we do not know, or we do not know very clearly, for how long persons in the position of the applicants or group members might have been perfectly well aware that they had actions which might have been brought a lot sooner and got on for trial by now and be over.  Those are the submissions in support of the submission that special leave should be refused.

GLEESON CJ:   Thank you, Mr Gee.  Mr Finch.

MR FINCH:   Your Honours, I can be brief, if I may, with respect, adopt the submissions of my learned friends, Mr Archibald and Mr Gee.  I do not wish to add anything save to emphasise this short point.  In answer to Justice Kirby’s proposition, a maintenance of the order to refuse leave to re-plead does not put the applicants out of court.  There is no evidence, in fact, that it would put anybody out of court.  There was a possibility that some applicants might fall between two chairs because of the lapse of certain time periods.  But, your Honours, it is not ‑ ‑ ‑

KIRBY J:   Mr Finch, it puts them out of court in their claim under Part IVA and that ‑ ‑ ‑

MR FINCH:   Not really, your Honour, because what was done was Justice Sackville said that they did not plead what they said they wanted to plead.  He did not say, “You cannot bring a collective action under Part IVA”, of the sort they said they wanted to bring.

KIRBY J:   Within this action?  Do you concede that they can come along again to the Federal Court pleading a Part IVA claim against the respondents?

MR FINCH:   It depends what they say about the pleading.

KIRBY J:   So you do not say that they are out of court on that basis?  You concede that they could bring proceedings under Part IVA against all of the respondents.

MR FINCH:   It depends entirely on what they say, your Honour.  We do not know how ‑ ‑ ‑

GLEESON CJ:   This is a pleading summons.

MR FINCH:   A pleading summons.  Until we know what they say, we do not know whether 33C is satisfied and this is, with respect, Mr Gee’s point.  It was not as though 33C was, in fact, applied rigorously in any sense.  We did not even get to the point of 33C because the pleading was so vague, ambiguous and full of inconsistency, that their Honours, with respect, simply could not tell what was said at the end of the day about the nature of the so-called collective case.

KIRBY J:   The paragraphs Mr Tobin read did not seem all that vague or uncertain.

MR FINCH:   If your Honour tries to read together paragraphs 5, 14 and 15, your Honour will be, with respect, lost to say what it is about the conduct of the respondent that is said to be wrongful, who it is who is said to have a claim against them and what group of them is said to offend what provisions of the Trade Practices Act.  With respect, all their Honours did was to say, “You have had enough goes”.  His Honour Justice Sackville was prepared to allow them one, specifically one more go, but the other two judges, after taking into account what we say were proper factors, and not taking into account any improper factors, declined to give them leave to proceed.

His Honour Justice Spender said, “They can replead, even as a representative action, if they want to and if they can think of a way of doing it”, and it is quite apparent, even from an analysis of the documents, that if they want to they can individually plead and have their actions joined together in the usual provisions under the State Court Acts.  That is all I wish to say, your Honours, in addition to my learned friend’s submission.

GLEESON CJ:   Yes, thank you.  Mr Tobin.

MR TOBIN:   Your Honours, with regard to the question of the cost of individuals litigating this matter, at 1176 and 1177, the last two sheets of the volumes of the application book, we have set out part of a submission made by the respondents to the Legal Aid Authorities opposing a grant of legal aid to a plaintiff and the respondents invoke:

The costs to prosecute … are likely to be extremely high.  A considerable amount of medical and scientific expert evidence will be required on complex and controversial issues ‑ ‑ ‑

GLEESON CJ:   I presume, and correct me if I am wrong, we have no information as to the financial basis on which Slater & Gordon are acting for these people.

MR TOBIN:   No, your Honours do not.

GLEESON CJ:   No.  It would be none of our business I should have thought.

MR TOBIN:   Well, as citizens, it would be, your Honours, but judicially, perhaps not.  But the reality of the situation, if I can say it one last time, is that the findings by Mr Justice Spender and Mr Justice Sackville with regard to the 33C(1)(b) requirement, make it effectively impossible for us to replead this case as another Part IVA proceeding.  The logic of the decision of the Full Court, your Honours, if I can depart from the context of it being just a pleading summons, if I could say to your Honour the Chief Justice, what was involved also was a challenge to the Part IVA proceedings.

GLEESON CJ:   My experience as a practitioner, Mr Tobin, was that when people find it impossible after a number of goes to formulate their case, it is because they do not have one.

MR TOBIN:   Well, your Honours, if I can outline the simple text of our case.  It is that the respondents have engaged in conduct contrary to the law, contrary to section 52.  It is the conduct apt for a mass marketing culture which they have exploited.  Over a period of 30 to 40 years, they have never acknowledged or admitted the risk of their product to the health of members of the community who consume it.  They are, whatever the criticism of the pleading, the classic elements that go into section 52, not as section 52 as understood in the context of an advertising case or campaign, but section 52 as conduct which the Federal Parliament has made unlawful.

GLEESON CJ:   You may be right about that.  There may be a powerful case that can be made out but the problem is with the case that you have so far attempted to make out and that is all that a pleading summons can ever deal with.

MR TOBIN:   Well, your Honours, what we say is that we have been unfairly characterised as to our pleading.  If I can illustrate it again with one simple point.  If it be necessary to show, under 33C(1)(a), that the conduct of each respondent was contributing to what happened to each of the group members, we have pleaded at common law a common purpose count of breach of duty involving all respondents.  Now, that is an issue which Mr Justice Sackville did not even refer to when he said that our pleading had failed to meet the requirements of 33C(1)(a).  If he had looked at it, we at least would have been in the position, your Honours, where he might

consider whether a common purpose count of negligence at common law is available in Part IVA proceedings in the Federal Court to perfect the requirements of section 33C(1)(a).

Now, your Honours, I cannot do more than invite your Honours to look at that part of the pleading.  On our understanding of the law, it is open, in a Part IVA proceeding, to rely upon the common law count, or perhaps I should say, our urging of what the law should be.  If that is correct, if his Honour has overlooked that and Justice Spender and Justice Hill did not refer to it, then our clients are put out of court on a pleading summons on an issue of non-compliance with the requirement of Part IVA which has simply been overlooked by their Honours in the Full Court.  I conclude with this, your Honours.  In Mr Justice Sackville’s judgment at paragraph 17, his Honour says:

Secondly, it is impossible to conceive how a case could be pleaded, consistent with instructions, which would allege that each and every applicant class member suffered loss or damage as a result of misleading and/or deceptive conduct of every respondent as principal, or as a result of negligence on the part of every respondent as principal.

That seems to be a statement of the law which, in plain language, is wrong.

KIRBY J:   But you say that even if it is right, it is a very important question because it goes to the very heart of the construction of the group proceedings legislation.

MR TOBIN:   In effect, your Honour, if Part IVA is to have any legs, cases of this kind will need to be given the opportunity to be presented to the court.

GLEESON CJ:   Thank you, Mr Tobin.  We will adjourn for a short time to consider the course the Court will take in the matter.

AT 12.45 PM SHORT ADJOURNMENT

UPON RESUMING AT 12.46 PM:

GLEESON CJ:   By majority, the Court is of the view that the application for special leave to appeal should be refused for the following reasons.  There are two aspects of the matter that the applicants seek to bring before this Court.  The first is the question of the form of the pleading.  On that question, the Full Court of the Federal Court was unanimously of the view that the pleading should be struck out.  A majority of this Court is of the view that there is no sufficient reason to doubt the correctness of that conclusion.

The second aspect concerned the discretionary matter of whether there should be leave to re-plead.  On that aspect of the matter a majority of this Court is of the view that no error of principle has been shown in the approach taken by the majority of the Full Court of the Federal Court in relation to the exercise of that court’s discretion.

Can you resist an order for costs, Mr Tobin?

MR TOBIN:   No.

GLEESON CJ:   The applicant must pay the respondent’s costs of the application.

AT 12.48 PM THE MATTER WAS CONCLUDED