Wilson v Allen (No 2)
[2024] ACTSC 13
•2 February 2024
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Wilson v Allen (No 2) |
Citation: | [2024] ACTSC 13 |
Hearing Date: | 9 November 2023 |
Decision Date: | 2 February 2024 |
Before: | Curtin AJ |
Decision: | See [168] |
Catchwords: | CIVIL PROCEDURE – ABUSE OF PROCESS – Application to permanently stay proceedings as an abuse of process – whether claim could and should have been litigated in earlier proceedings between same parties – consideration of UBS AG v Tyne [2018] HCA 45; 265 CLR 77 – whether circumstances of case amount to exceptional circumstances – application dismissed PRACTICE AND PROCEDURE – EVIDENCE – Consideration of the rule in Browne v Dunn (1894) 6 R 67 – where submission made that the Court ought to infer certain steps were taken in litigation to gain a forensic advantage – whether submission could be made without first putting the allegations to the relevant witness and providing him an opportunity to respond – whether witness already on notice to the challenge to be made to evidence – where alternative hypothesis needed to be put to witness in cross-examination |
Legislation Cited: | Court Procedures Act 2004 (ACT) s 5A |
Cases Cited: | Allen v Wilson [2023] ACTSC 10 |
Texts Cited: | JD Heydon, Cross on Evidence (online, LexisNexis, 2023) |
Parties: | Kevin Wilson ( First Plaintiff) Tranquillity Homes Canberra Pty Limited ( Second Plaintiff) Tabula Rasa Holdings Pty Limited as Trustee for the TR Wilson Family Trust ( Third Plaintiff) John Thomas Allen ( First Defendant) Ivor Harold Nyman ( Second Defendant) KPW Law Pty Ltd trading as KPW Lawyers ( Third Defendant) |
Representation: | Counsel WDB Buckland ( Plaintiffs) R Size (First Defendant) K Martin (Second and Third Defendant) |
| Solicitors Gabbedy Milson Lee ( Plaintiffs) HWL Ebsworth ( First Defendant) Moray & Agnew Lawyers ( Second and Third Defendant) | |
File Number: | SC 41 of 2023 |
CURTIN AJ:
Introduction
1․The first defendant, Mr Allen, seeks an order that the present proceedings be permanently stayed.
2․The proceedings, to the extent they pertain to Mr Allen, concern a claim by Mr Wilson and two associated corporate plaintiffs for compensation under s 108 of the Land Titles Act 1925 (ACT) (the LTA) for loss and damage purportedly suffered as a result of Mr Allen’s alleged wrongful lodgement of a caveat over a property owned by Mr Wilson.
3․By and large, Mr Allen makes the present application on the basis that Mr Wilson’s claim for compensation could and should have been litigated in earlier proceedings between the parties that were before the Court. The fact that Mr Wilson has instead brought the claim in a separate proceeding is, according to Mr Allen, an abuse of process justifying a permanent stay of the proceedings brought against him.
4․For the reasons that follow, the application should be dismissed.
Procedural background
5․Mr Allen’s application is made in the second set of proceedings that are before the Court concerning a dispute between Mr Allen, Mr Wilson, and related parties.
6․The first proceedings were commenced by Mr Allen (the first proceedings) and were heard and determined by McWilliam AsJ (as her Honour then was): see Allen v Wilson [2023] ACTSC 10 (Allen). In those proceedings, Mr Allen and two associated corporations sued Mr Wilson and two associated corporations in relation to a loan and guarantees related to a proposed property development. Mr Wilson initially counterclaimed against Mr Allen in the first proceedings for damages arising out the alleged wrongful lodging of a caveat over real property in the Australian Capital Territory owned by Mr Wilson.
7․During the hearing of the first proceedings, Mr Wilson sought and obtained leave to withdraw that counterclaim on the basis that new evidence had come to light during the hearing and that additional claimants and defendants needed to be added to the counterclaim.
8․On 30 January 2023, these (new) proceedings were commenced by Mr Wilson and two associated corporations against Mr Allen in relation to the caveat (the second proceedings) but without the additional defendants mentioned before McWilliam AsJ in the first proceedings.
9․On 23 March 2023, Mr Allen filed an application for a permanent stay of the second proceedings, essentially because Mr Wilson had not done what he told McWilliam AsJ that he wanted and needed to do (namely, to sue additional defendants) as a reason for seeking leave to withdraw the counterclaim in the first proceedings.
10․On 12 July 2023, and in response, the plaintiffs filed an application to amend the statement of claim to add the two defendants that Mr Wilson had said in the first proceedings he wished to sue.
11․The two applications came before me 3 August 2023. On that day it was decided that the plaintiffs’ application be heard and determined first because the hearing of the defendant’s permanent stay application would be affected by the outcome of the plaintiffs’ application.
12․I granted the plaintiffs’ application to join two additional defendants and granted leave to amend the pleadings: Wilson v Allen [2023] ACTSC 257 (Wilson).
13․Mr Allen has subsequently pressed his application for a permanent stay.
14․Further factual detail may be found, if necessary, in Allen and Wilson.
The principles
15․A number of general principles are relevant to determining an application for a permanent stay.
16․First, although the application was not advanced on this basis, it is worth mentioning that r 40(1)(g) of the Court Procedure Rules 2006 (ACT) (the Rules) grants the Court express statutory authority to stay proceedings. It says:
40 Setting aside originating process etc
(1)The court may—
…
(g)stay a proceeding…
…
17․This power also exists in the Court’s inherent jurisdiction. In Clyne v New South Wales Bar Association (1960) 104 CLR 186 at 201, Dixon CJ, McTiernan, Fullagar, Menzies and Windeyer JJ said:
…every court has an inherent jurisdiction to stay proceedings which are an abuse of its process.
18․The existence of the inherent jurisdiction to prevent an abuse of the Court’s process by staying proceedings continues to be accepted as a general principle: see Jago v District Court (NSW) (1989) 168 CLR 23 (Jago) at 25 per Mason CJ; Walton v Gardiner (1993) 177 CLR 378 (Walton v Gardiner) at 392 per Mason CJ, Deane and Dawson JJ; St George Bank Ltd v Hu [2012] ACTSC 10 at [28]; Jorgensen v Wilson (No 2) [2023] ACTSC 40 at [54]. The purpose of this inherent jurisdiction was described by Mason CJ, Deane and Dawson JJ in Walton v Gardiner at 392 to 393 as follows:
The inherent jurisdiction of a superior court to stay its proceedings on grounds of abuse of process extends to all those categories of cases in which the processes and procedures of the court, which exist to administer justice with fairness and impartiality, may be converted into instruments of injustice or unfairness…The jurisdiction of a superior court in such a case was correctly described by Lord Diplock in Hunter v Chief Constable of the West Midlands Police as “the inherent power which any court of justice must possess to prevent misuse of its procedure in a way which, although not inconsistent with the literal application of its procedural rules, would nevertheless be manifestly unfair to a party to litigation before it, or would otherwise bring the administration of justice into disrepute among right-thinking people”.
(Citations omitted.)
19․Importantly, a permanent stay of proceedings is only to be ordered in exceptional circumstances and is to be understood as a measure of last resort: Williams v Spautz (1992) 174 CLR 509 at 529 per Mason CJ, Dawson, Toohey and McHugh JJ; GLJ v Trustees of Roman Catholic Church for Diocese of Lismore [2023] HCA 32; 97 ALJR 857 at 862 [3] per Kiefel CJ, Gageler and Jagot JJ.
20․Nonetheless, accepting the Court’s inherent jurisdiction to stay proceedings is merely a steppingstone. To truly advance a case for a permanent stay of the second proceedings as an abuse of process, the second proceedings must actually be an abuse of process.
21․In deciding this, all relevant circumstances, both objective and subjective, may be taken into account: Stokes v Toyne [2023] NSWCA 59 (Stokes v Toyne) at [69] per Adamson JA. The question is to be answered by reference to the factual matrix prevailing, at the earliest, at the time the proceedings sought to be stayed were commenced but may also extend beyond that time: Stokes v Toyne at [133]-[134] per Simpson AJA.
22․What constitutes an abuse of process is infinitely varied and impossible to define in absolute terms: Tomlinson v Ramsey Food Processing Pty Ltd [2015] HCA 28; 256 CLR 507 (Tomlinson) at 518 [25] per French CJ, Bell, Gageler and Keane JJ; Findex Group Limited v McKay [2022] ACTSC 192 (Findex) at [63]. In PNJ v R [2009] HCA 6; 83 ALJR 384, French CJ, Gummow, Hayne, Crennan and Kiefel JJ, citing McHugh J in Rogers v R (1994) 181 CLR 251 at 286, acknowledged at 386 [3] that:
It may be accepted, however, that many cases of abuse of process will exhibit at least one of three characteristics:
(a) the invoking of a court’s processes for an illegitimate or collateral purpose;
(b) the use of the court’s procedures would be unjustifiability oppressive to a party; or
(c) the use of the court’s procedures would bring the administration of justice into disrepute.
23․The practical application of the second category was considered by Simpson AJA in Stokes v Toyne at [138] to manifest where circumstances suggest a party has attempted to “raise issues that have previously been raised”, or, as referred to by Mason CJ, Deane and Dawson JJ in Walton v Gardiner at 393, to “litigate anew a case which has already been disposed of by earlier proceedings”.
24․In the context of attempted re-litigation, the principles espoused by the High Court of Australia in UBS AG v Tyne [2018] HCA 45; 265 CLR 77 (UBS v Tyne) are instructive.
25․In UBS v Tyne, the former trustee of a family trust, an investment company, and Mr Scott Tyne (the controlling mind of the company and later the trustee of the family trust) sued UBS AG (UBS) in the Equity Division of the Supreme Court of New South Wales for alleged professional negligence. The Supreme Court proceedings were permanently stayed on the ground of other prior proceedings which had been finalised in the High Court of Singapore (the Singapore proceedings) giving rise to res judicata: see Telesto Investments Ltd v UBS AG [2013] NSWSC 503.
26․Mr Tyne then commenced proceedings in the Federal Court of Australia, making substantially the same allegations as in the Supreme Court proceedings. At first instance, Greenwood J stayed the Federal Court proceedings as an abuse of process: see Tyne v UBS AG (No 3) [2016] FCA 5; 236 FCR 1 (Tyne v UBS (No 3)). Mr Tyne appealed to the Full Court of the Federal Court, which allowed the appeal and revoked the permanent stay (Jagot and Farrell JJ; Dawson J dissenting): see Tyne v UBS AG (No 2) [2017] FCAFC 5; 250 FCR 341 (Tyne v UBS (No 2)).
27․UBS appealed to the High Court, which, by majority (Kiefel CJ, Bell, Keane and Gageler JJ) allowed the appeal and found that the Federal Court proceedings ought to be permanently stayed as an abuse of process: see UBS v Tyne.
28․In the joint judgment of Kiefel CJ, Bell and Keane JJ in UBS v Tyne, their Honours considered at 92 [34] that an enquiry into an alleged abuse of process must be carried out in light of the procedural law of the court whose processes are said to be engaged in abuse. In that case, the relevant provision was s 37M of the Federal Court of Australia Act 1976 (Cth) (the FCAA), the jurisdictional analogue of which is s 5A of the Court Procedures Act 2004 (ACT) (the Act): UBS v Tyne at 125 [128] per Nettle and Edelman JJ; Findex at [68].
29․Section 5A of the Act says:
5A Main purpose of civil procedure provisions
(1)The main purpose of the civil procedure provisions is to facilitate the just resolution of disputes—
(a)according to law; and
(b)as quickly, inexpensively and efficiently as possible.
(2)Without limiting subsection (1), the main purpose includes the following objectives:
(a)the just resolution of the real issues in civil proceedings;
(b)the efficient use of the judicial and administrative resources available for the purposes of the court;
(c)the efficient disposal of a court’s overall caseload;
(d)the timely disposal of civil proceedings;
(e)the resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute.
(3)The civil procedure provisions must be interpreted and applied, and any power or duty imposed by them (including the power to make rules) must be exercised or carried out, in the way that best promotes the main purpose.
(4)The parties to a civil proceeding must help the court to achieve the objectives.
30․Their Honours reasoned at 93 [38] that the purposes provided for in s 37M(1) of the FCAA (which are in nearly identical terms to s 5A(1) of the Act) take into account “wider public interests than those of the parties to the dispute”. Citing the joint judgment of Gummow, Hayne, Crennan, Kiefel and Bell JJ in Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; 239 CLR 175 (Aon) at 212 [113], their Honours continued at 93 [38] to explain that the “just resolution” of a dispute must be interpreted in light of the overarching purpose and objectives of civil procedure, which invariably include serving the public as a whole, not merely the parties to the proceedings.
31․As such, although a party may have a right to bring proceedings, that is not the be-all and end-all, and limits will be placed upon parties conduct during the proceedings such that their Honours preferred to interpret the “just resolution” of a dispute in UBS v Tyne at 94 [38]:
…in terms of the parties having a sufficient opportunity to identify the issues that they seek to agitate.
(Emphasis in original.)
32․Additionally, of significant relevance is their Honours’ consideration of the procedural effect of a discontinuance of proceedings where the rules of the court expressly stipulate that a discontinuance is no bar to bringing fresh proceedings for the same relief. This is provided for under r 1167(1) of the Rules, which says:
1167 Discontinuance or withdrawal—subsequent proceeding
(1)A discontinuance or withdrawal under this division is not a defence to another proceeding on the same or substantially the same ground.
…
33․As to the application of such provision, their Honours said at 99 [56]:
It may be accepted that, under r 12.3(1) of the Uniform Civil Procedure Rules 2005 (NSW), the discontinuance of proceedings does not operate as a release of the claims made by the discontinuing party. But that does not mean that discontinuance is irrelevant when the discontinuing party seeks by new proceedings to pursue a discontinued claim. Nor does the possibility that a party might have sought the protection of conditions upon discontinuance, but did not, mean that the disruption and extra costs incurred by that party when confronted by new proceedings is not relevant to whether an abuse of process is being perpetrated.
(Emphasis added.)
34․The disruption experienced by the other party was also recognised in Aon at 214 [101], where their Honours acknowledged that personal litigants are likely to feel the strain of litigation more than corporations. This includes the non-compensable inconvenience, stress, and time lost for which a favourable costs order is no longer accepted to be a panacea: Bomanite Pty Ltd v Slatex Corp Aust (1991) 32 FCR 379 at 392 per French J; Stokes v Toyne at [151] per Simpson AJA.
35․Further, in respect of the type of abuse of process at issue, being the litigation of claims that could and should have been litigated in the Supreme Court proceedings, their Honours adopted at 96 [43] the remarks of French CJ, Bell, Gageler and Keane JJ in Tomlinson at 519 [26]:
Accordingly, it has been recognised that making a claim or raising an issue which was made or raised and determined in an earlier proceeding, or which ought reasonably to have been made or raised for determination in that earlier proceeding, can constitute an abuse of process even where the earlier proceeding might not have given rise to an estoppel.
(Citations omitted.)
36․In Port City Pty Ltd v Fiocco [2022] WASC 226 at [13]-[14], Tottle J viewed their Honours’ use in Tomlinson of the non-prescriptive “can” as accepting that there is “no absolute rule” on when the re-litigation of an issue will be an abuse of process. Contrastingly, in UBS v Tyne at 96 [45], their Honours concluded, in particularly definitive terms, that the use of different legal entities, controlled by a single directing mind and will, to commence and then withdraw a series of actions, would constitute an abuse of process. Their Honours said at 96-97 [46]:
Serial proceedings discontinued prior to judgment would be an obvious example of an abuse of process. The pursuit of substantially the same claim by serial proceedings conducted by different entities under common control is no less obviously an abuse of process.
37․Further, in a separate judgment in UBS v Tyne, Gageler J approved at 102-103 [67]-[68] the statement of principle regarding the distinction between “should” and “could” made by Lord Bingham in Johnson v Gore Wood &Co [2002] 2 AC 1 at 31:
It is, however, wrong to hold that because a matter could have been raised in earlier proceedings it should have been, so as to render the raising of it in later proceedings necessarily abusive. That is to adopt too dogmatic an approach to what should in my opinion be a broad, merits‐based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before….
38․His Honour recognised that what “could” have been done does not necessarily accord with what “should” have been done: UBS v AG at 103 [68]. The result is that it is not enough to say that a claim “could” have been litigated: McKay v Findex Group Ltd [2022] ACTSC 191 at [79].
39․When considering whether there was an abuse of process in Fairfax Media Publications Pty Ltd v Cummings [2012] ACTCA 36; 269 FLR 182 at 189-190 [34], Refshauge J had regard to the matters identified by Giles CJ Comm D in State Bank of New South Wales v Stenhouse Ltd (1997) Aust Torts Reports ¶81-423 at 64,089:
(a) the importance of the issue in and to the earlier proceedings, including whether it is an evidentiary issue or ultimate issue;
(b) the opportunity available and taken to fully litigate the issue;
(c) the terms and finality of the finding as to the issue;
(d) the identity between the relevant issues in the two proceedings;
(e) any plea of fresh evidence, including the nature and significance of the evidence and the reason why it was not part of the earlier proceedings; …
(f) the extent of the oppression and unfairness to the other party if the issue is relitigated and the impact of the relitigation upon the principle of finality of judicial determination and public confidence in the administration of justice; and
(g) an overall balancing of justice to the alleged abuser against the matters supportive of abuse of process.
(Emphasis added.)
40․That statement has been endorsed and applied many times: see Rippon v Chilcotin Pty Ltd [2001] NSWCA 142; 53 NSWLR 198; Spalla v St George Motor Finance Ltd (No 6) [2004] FCA 1699; Habib v Radio 2UE Sydney Pty Ltd [2009] NSWCA 231 (Habib); Patial v Kailash Lawyers Pty Ltd (t/as Kailash Lawyers and Consultants) [2022] FCA 662. As noted by McColl JA in Habib at [92], although those considerations are non-exhaustive, they indicate the nature of the Court’s task.
Submissions
Mr Allen
41․Mr Allen submitted that these second proceedings were as much, if not more, of an abuse of process as the kind that were permanently stayed in UBS v Tyne.
42․Mr Allen submitted that there were five factors considered to be determinative in the granting of a permanent stay in the judgment of Greenwood J in Tyne v UBS (No 3), the dissenting judgment of Dowsett J in Tyne v UBS (No 2), and the judgments of Kiefel CJ, Bell and Keane JJ, and Gageler J in UBS v Tyne.
Factor 1: whether the claim could have been brought in the first proceedings
43․Mr Allen submitted that a key factor considered was whether Mr Tyne’s claim could have been brought in the Supreme Court of NSW: Tyne v UBS (No 3) at 60-61 [423]-[424] per Greenwood J; UBS v Tyne at 95 [41] per Kiefel CJ, Bell and Keane JJ. He submitted that it was found by their Honours that the claim brought by Mr Tyne in the Federal Court proceedings could have been brought in the Supreme Court proceedings because the facts, circumstances and allegations pleaded in the two sets of proceedings were the same, and Mr Tyne had in fact bought the claim prior to discontinuing: Tyne v UBS (No 3) at 60 [417] per Greenwood J; Tyne v UBS (No 2) at 349 [8] per Dowsett J; UBS v Tyne at 90 [27] per Kiefel CJ, Bell and Keane JJ.
44․Mr Allen submitted that Mr Wilson’s claim could have been brought in the first proceedings because the facts, circumstance and allegations pleaded against Mr Allen in the two sets of proceedings are the same, and Mr Wilson did in fact bring a counterclaim in the first proceedings prior to withdrawing it on the final day of the hearing.
45․Specifically, Mr Allen argued that the relief sought by Mr Wilson in the present proceedings is the same as was sought in the counterclaim in the first proceedings, namely, compensation pursuant to s 108 of the LTA for the alleged lodging of a caveat without reasonable cause (the original caveat claim).
46․He argued that the only difference between the first proceedings and the present proceedings is that Mr Wilson has:
(a)joined two companies within his control as further plaintiffs; and
(b)claimed against two further defendants, being the solicitors who represented Mr Allen when he lodged the caveat.
47․Mr Allen submitted that the original caveat claim and Mr Wilson’s claim in these proceedings lack any substantive difference and, as such, the present proceedings are an abuse of process because Mr Wilson could have maintained the original caveat claim in the first proceedings.
Factor 2: Whether the claim should have been brought in the first proceedings
48․Mr Allen submitted that a further important factor considered when deciding whether the proceedings were an abuse of process was whether Mr Tyne’s claim should have been brought in the earlier proceedings in the sense that it “ought reasonably to have been made or raised for determination” in the earlier proceedings: Tyne v UBS (No 3) at 48 [343] per Greenwood J; Tyne v UBS (No 2) at 345 [2] in per Dowsett J; UBS v Tyne at 95-96 [43] and 100 [58] per Kiefel CJ, Bell and Keane JJ, at 105 [75] per Gageler J. He submitted that their Honours recognised it as necessary to assess whether a plaintiff has given a “proper explanation” for a failure to bring the claim in earlier proceedings: Tyne v UBS (No 3) at 60 [421] per Greenwood J; Tyne v UBS (No 2) at 353 [23] per Dowsett J; UBS v Tyne at 98-99 [52]-[55] per Kiefel CJ, Bell and Keane JJ, at 106-107 [77]-[82] per Gageler J.
49․Mr Allen submitted that this principle was engaged because Mr Wilson’s claim in the present proceedings “ought reasonably to have been made or raised for determination” in the first proceedings. He submitted that the Court is tasked with determining whether Mr Wilson gave a “proper explanation” for his failure to maintain the original caveat claim.
50․He argued that the propriety of any explanation given to the Court must be gauged by reference, not only to the interest of the plaintiff, but also the “public interest in the timely and efficient administration of civil justice”: UBS v Tyne at 103-104 [70] and 107 [80] per Gageler J. He submitted that their Honours held that the purpose of securing some “forensic advantage” does not constitute a proper explanation: Tyne v UBS (No 2) at 353 [23] per Dowsett J; UBS v Tyne at 98-99 [55] per Kiefel CJ, Bell and Keane JJ, at 107 [81] per Gageler J.
51․Mr Allen submitted that Mr Tyne gave two explanations in UBS v Tyne for not maintaining the subject claim in the Supreme Court proceedings. Firstly, he submitted that Mr Tyne said that the claim would “have been more burdensome and expensive”: UBS v Tyne at 98 [54] per Kiefel CJ, Bell and Keane JJ. Secondly, he submitted that Mr Tyne said that he would not have needed to commence the Federal Court proceedings if the Supreme Court proceedings succeeded: UBS v Tyne at 98-99 [55] per Kiefel CJ, Bell and Keane JJ.
52․He submitted that Mr Wilson similarly advanced two explanations for withdrawing the original caveat claim in the first proceedings. However, he submitted that it is important the Court consider the context in which Mr Allen gave these two explanations in the first proceedings, namely in an affidavit sworn on 9 September 2022 at [11]-[12], marked Exhibit SJC-1(c) in these proceedings, in which Mr Wilson said:
As a result of the Caveats lodged by the Plaintiffs over the Coombs property, I have not been able to obtain funding, from my usual funding sources, to fund my business projects.
I have been forced to obtain alternate funding to my business projects, at a significantly increased interest rate. The interest rate I am currently paying is 24% per annum.
53․Mr Allen submitted that Mr Wilson also gave similar evidence in his evidence in chief in the first proceedings before McWilliam AsJ at T286.33, marked Exhibit SJC-1(h) in these proceedings.
54․Mr Allen submitted that Mr Wilson did not provide any documentary evidence in either his affidavit or evidence in chief in the first proceedings to sustain the proposition that he was unable to obtain funding at a lower interest rate because of the caveat. He submitted that the Facility Agreement, dated 24 November 2021 and annexed to Mr Wilson’s affidavit that is marked Exhibit SJC-1(c) in these proceedings, records him obtaining finance secured against six properties, three of which (including the property which the caveat dispute concerned) were already mortgaged. Mr Allen submitted that there was no evidence to explain how a caveat on a property that was already mortgaged precluded Mr Wilson from obtaining more favourable finance.
55․Mr Allen submitted, in those circumstances, Mr Wilson stood to obtain a significant forensic advantage by obtaining leave to withdraw the original caveat claim—namely, the chance to run the caveat claim a second time with evidence (if such evidence existed) capable of establishing that the caveat caused him to suffer a loss.
56․The first explanation Mr Allen submitted Mr Wilson gave was that other parties had to be joined as claimants to the caveat claim. He submitted that Mr Wilson said this in the first proceedings before McWilliam AsJ at T385-386 and T393-398. These other parties were two corporate entities that were, and still are, under the control of Mr Allen, and whom are now the second and third plaintiffs in the present proceedings.
57․Mr Allen submitted that a desire to join further claimants is not to be considered a proper explanation for Mr Wilson’s failure to maintain the original caveat claim as those companies could have been joined at the outset. He submitted that in the authorities he relied on, their Honours did not consider the distinction between Mr Tyne and the entities within his control to weigh against ordering the permanent stay: Tyne v UBS (No 3) at 59 [414] per Greenwood J; Tyne v UBS (No 2) at 350 [13] per Dowsett J; UBS v Tyne at 96 [45] per Kiefel CJ, Bell and Keane JJ.
58․Mr Allen submitted that the present proceedings engage the circumstances discussed by their Honours in UBS v Tyne at 96-97 [45]-[46], namely the use of separate corporate entities to institute serial proceedings. He argued that there was no reason why the other parties under Mr Wilson’s control, being the second and third plaintiff, could not have been joined as cross-claimants in the first proceedings. He submitted that the claims advanced by the two companies in these proceedings are identical to the claim advanced by Mr Wilson in the first proceedings, and as such, joining the corporations to the first proceedings would have involved nothing more than substituting Mr Wilson’s name for them.
59․He submitted that insofar as Mr Wilson sought to withdraw the original caveat claim for the purpose of joining the companies as claimants, Mr Wilson’s purpose ought to be regarded as attempting to secure a forensic advantage, namely, avoiding the companies being precluded from advancing their claim or being bound by findings from the first proceedings due to res judicata, issue estoppel or abuse of process.
60․The second explanation Mr Allen submitted Mr Wilson gave was that Mr Wilson said that other parties, being Mr Allen’s then-solicitor, Mr Ivor Harold Nyman, and that solicitor’s firm, KPW Lawyers, had to be joined as defendants to the caveat claim. Mr Allen submitted that Mr Wilson desired to join those parties as additional defendants as a result of evidence given by Mr Nyman during the hearing of the first proceedings. He submitted that Mr Wilson gave this explanation to McWilliam AsJ in the first proceedings.
61․Mr Allen advanced three reasons the Court should doubt that Mr Wilson’s desire to join the second and third defendant was a significant driving force in the withdrawal of the original caveat claim, namely:
(a)As mentioned in Wilson at [89], it appeared that neither Mr Wilson nor his previous counsel considered the prospects of making a claim against Mr Nyman or KPW Lawyers to be worth mentioning to Mr Wilson’s current solicitor because those parties were not originally named as defendants. Mr Allen argued that ordinary experience suggests that Mr Wilson or his previous Counsel would have informed the solicitor with carriage of Mr Wilson’s matter of the evidence given by Mr Nyman, the basis upon which Mr Wilson could make a claim against Mr Nyman or KPW Lawyers, and the need to join Mr Nyman or KPW Lawyers to the second proceedings, had they considered those matters to be significant reasons for withdrawing the original caveat claim.
(b)Upon receiving Mr Allen’s permanent stay application, Mr Wilson did not file an application seeking to join Mr Nyman or KPW Lawyers until after the exchange of written submissions made clear that Mr Wilson’s position would be indefensible unless he applied to join them. Mr Allen submitted that ordinary experience suggests that Mr Wilson would have applied to join Mr Nyman or KPW Lawyers immediately after receiving the permanent stay application had the desire to join those parties been a significant driving force behind his withdrawal of the original caveat claim.
(c)There are clear and compelling reasons to doubt the prospects of Mr Wilson succeeding in a claim against Mr Nyman or KPW Lawyers. Mr Allen submitted that these reasons are expounded in Wilson at [92]-[93]. He argued that objectively, as a matter of ordinary experience, a person would be unlikely to withdraw a claim for the purpose of obtaining the chance to pursue other claims that have only tenuous prospects of success.
62․Mr Allen submitted that in such circumstances, the Court ought to infer that the predominant reason Mr Wilson withdrew the original caveat claim was due to a desire to obtain two significant forensic advantages, the first being the opportunity to join his two companies, and the second being to improve upon the state of his evidence as to the effect of the caveat upon his dealings.
63․To the extent that Mr Wilson was motivated by a desire to join his previous solicitors as defendants, Mr Allen submitted that the course Mr Wilson adopted was the least consistent with Mr Wilson’s duty under s 5A(4) of the Act. He submitted that this is because there were two other options available to Mr Wilson: first, to maintain the original caveat claim without joining Mr Nyman or KPW Lawyers as defendants; second, to seek orders for the joinder of Mr Nyman or KPW Lawyers and separate resolution of the original caveat claim.
64․Mr Allen submitted that there were at least five possible outcomes if Mr Wilson had followed the first option and maintained the original caveat claim without joining Mr Nyman or KPW Lawyers as defendants:
(a)Mr Wilson succeeding in the caveat claim, in which case there would be no need to commence proceedings against his previous solicitors;
(b)Mr Wilson failing in the caveat claim because Mr Allen was held to have had reasonable cause for lodging the caveat due to having a caveatable interest, in which case there would be no basis to commence proceedings against his previous solicitors;
(c)Mr Wilson failing in the caveat claim because Mr Allen was held to have had reasonable cause for lodging the caveat because he relied upon advice given by his previous solicitors that was incorrect, in which case there may have been a basis for Mr Wilson to commence proceedings against his previous solicitors;
(d)Mr Wilson failing in the caveat claim because he was unable to prove that he suffered any loss, in which case there would be no basis to commence proceedings against his previous solicitors; or
(e)Mr Wilson failing in the caveat claim because he was unable to prove that the loss he suffered was caused by Mr Allen lodging the caveat, in which case there would be no basis to commence proceedings against his previous solicitors.
65․Mr Allen submitted that the five scenarios that may have eventuated if Mr Wilson had maintained the original caveat claim all nullify any claim against Mr Nyman or KPW Lawyers for reasons beyond the problems concerning the scope of s 108 of the LTA and the existence of a duty of care. If the claim against Mr Nyman or KPW Lawyers was not nullified, Mr Wilson could have brought further proceedings against them alone.
66․As to the second option, Mr Allen submitted that adopting this approach would have been consistent with what Gageler J said in UBS v Tyne at 107 [80], namely:
Were it shown in the context of the SCNSW proceedings to have been consistent with the timely and efficient resolution of the overall matter in dispute for Telesto’s claims to have been pursued separately and in advance of those of the trustee, that could have been achieved by appropriate case management orders which could have resulted in the trustee being bound by findings of fact and determinations of law common to both sets of claims.
67․Mr Allen submitted that Mr Wilson did not adopt either approach and instead pursued the only course of action that guaranteed the caveat claim would have to be heard twice, namely, withdrawing the claim in the first proceedings after:
(a)both parties had filed affidavit evidence;
(b)both parties and Mr Nyman had given evidence in chief and undergone cross-examination; and
(c)Mr Allen had given evidence in reply.
68․He submitted that Mr Wilson chose this course of action notwithstanding McWilliam AsJ issuing multiple warnings about the possible consequences of the withdrawal.
69․Mr Allen concluded that the present proceedings were an abuse of process because Mr Wilson should have maintained the original caveat claim in the first proceedings. He argued that a desire to join further parties does not constitute a proper explanation for the withdrawal as Mr Wilson could have commenced separate proceedings against Mr Nyman or KPW Lawyers following the determination of the first proceedings (had there been a basis to do so).
70․He submitted that there are good reasons the Court should doubt that Mr Wilson’s desire to join his previous solicitors as defendants was a substantial force driving the withdrawal of the original caveat claim in the first proceedings. Mr Allen submitted that the Court ought not to accept a “proper explanation” for Mr Wilson’s failure to maintain the original caveat claim in the first proceedings as substantiated by the method adopted, which was the least likely to facilitate the timely and efficient resolution of the dispute, and the most likely to subject Mr Allen to unwarranted delay, cost, and inconvenience.
71․Mr Allen submitted that, in his view, there is an alternative explanation for Mr Wilson’s withdrawal of the original caveat claim, namely that Mr Wilson realised his evidence was insufficient to establish that he suffered any loss caused by the caveat after the witnesses had given evidence in the first proceedings. He argued the Court ought to infer that Mr Wilson acted for the forensic purpose of seeking to improve his evidence because:
(a)neither Mr Wilson’s affidavit dated 9 September 2022 nor his oral evidence in chief in the first proceedings established that he was unable to obtain funding at a lower interest rate because of the caveat;
(b)on the facts, Mr Wilson and his then legal representatives were likely to have realised whilst preparing for the final day of the hearing of the first proceedings that the evidence was insufficient to establish that Mr Wilson suffered any loss because of the caveat; and
(c)as a matter of ordinary experience, a person would not withdraw a claim after the evidence has been given unless he or she perceived serious problems with the claim.
Factor 3: Delay to the resolution of the dispute
72․The third factor that Mr Allen relied upon was whether the failure to bring a claim in the first proceedings delayed the resolution of the dispute between the parties: Tyne v UBS (No 2) at 351 [14], 352 [19], and 353 [23] per Dowsett J; UBS v Tyne at 96 [45] and 100 [58] per Kiefel CJ, Bell and Keane JJ. Mr Allen drew attention to Kiefel CJ, Bell and Keane JJ’s conception of the threshold in UBS v Tyne at 96 [45] as “substantial delay” and Gageler J’s emphasis at 105 [75] and 106 [78] on the public interest in the “timely and efficient administration of civil justice”.
73․Mr Allen submitted that if Mr Wilson had maintained the original caveat claim, it would likely have been resolved when McWilliam AsJ delivered judgment on 27 January 2023 in the first proceedings.
74․He contended that Mr Wilson’s withdrawal of the caveat claim caused a delay just as substantial as Mr Tyne’s decision to discontinue his claims in the Supreme Court proceedings. He submitted that the caveat claim deserved a one- or two-day hearing, for which judgment could have been delivered within a few months. He submitted that more than a year has passed since the final day of the hearing in the first proceedings, the Court has had to devote resources to the caveat claim a second time, the Court will have to hear evidence from the same witnesses who already gave evidence and were cross-examined in the first proceedings, and Mr Allen has had to spend significant time instructing solicitors a second time, all whilst “other litigants [have been] left in the queue awaiting justice”: UBS v Tyne at 96 [45] per Kiefel CJ, Bell and Keane JJ.
Factor 4: The risk of an increase in costs of resolving the dispute
75․The fourth factor that Mr Allen submitted was relevant was increased costs: Tyne v UBS (No 2) at 351 [14] and 353 [23] per Dowsett J; UBS v Tyne at 100 [58] by Kiefel CJ, Bell and Keane JJ, and at 105 [75] per Gageler J.
76․Mr Allen submitted that the unjustifiable oppression that he, an individual person, would be subject to if Mr Wilson’s claim was permitted to run is much greater than that suffered by UBS, a global financial services provider.
77․He said that he had spent approximately $205,000 in the first proceedings and has expended more than $30,000 defending the present proceedings. He submitted that costs orders made in his favour in the first proceedings did not provide complete indemnity. He further submitted that the costs of the present proceedings are likely to increase as a result of Mr Wilson joining the second and third defendants and as such the cost of these proceedings are likely to be far more than the cost of the first proceedings.
Factor 5: The inconvenience of dealing with the matter again
78․The fifth factor that Mr Allen submitted was relevant was the inconvenience of having to deal with the matter again after lengthy litigation: Tyne v UBS (No 3) at 61 [424] by Greenwood J; in Tyne v UBS (No 2) at 351 [14] and 353 [23] per Dowsett J; UBS v Tyne at 100 [58] per Kiefel CJ, Bell and Keane JJ, at 105 [75] by Gageler J.
79․Mr Allen argued that he had to deal with Mr Wilson’s original caveat claim in the first proceedings up until it was withdrawn on the final day of the hearing and this reason alone gave rise to an inconvenience greater than that suffered by UBS, whom never actually had to deal with the claim brought by Mr Tyne.
80․He contended that permitting Mr Wilson to run the caveat claim a second time visited manifest unfairness upon himself and required him to expend time, money and energy advancing his defence twice over.
81․He further submitted that, when considering the conduct of Mr Wilson and the effect of the dispute upon himself, there are three reasons the inconvenience was even greater, being:
(a)Mr Allen does not know the case he has to meet due to Mr Wilson’s consistent failure to properly plead his case, with Mr Wilson’s amended statement of claim still containing more than “minor defects” (see Wilson at [104]) and failing to state the damage suffered by Mr Wilson and his companies or the basis upon which such damage was allegedly caused by the caveat.
(b)Mr Allen has been precluded from advancing in life as a result of the dispute. Specifically, he has been unable to build his business, unable to finish the construction of his house, unable to take a holiday, and has had to live in a small, rented flat because of the ongoing legal expenses. He submitted that it is beside the point that he may obtain a favourable costs order at the conclusion of the present proceedings as, up until that point, and until the end of any costs assessment process (assuming Mr Wilson is capable of meeting a costs order), his funds remain tied up.
(c)The dispute with Mr Wilson has had a significant psychological toll upon Mr Allen. Mr Allen submitted that it has been “an extremely stressful and destructive 6-year process” that he feels has “ruined [his] life”. He sees himself as much less confident, significantly less social, constantly worried about money and suffering from “chronic and severe anxiety and suicidal thoughts”. Mr Allen recalled the experience of being cross-examined in the first proceedings as being a “very difficult and unpleasant experience”.
82․In summary, Mr Allen submitted that Mr Wilson withdrew the original caveat claim to gain the forensic advantages inherent in obtaining an opportunity to join the two companies within his control as plaintiffs and improve upon his evidence. As such, he submitted that the Court ought not to regard Mr Wilson as having provided a “proper explanation”. He submitted that Mr Wilson’s decision to withdraw the original caveat claim after evidence had been given about it at the hearing of the first proceedings and decision to bring the caveat claim again in the present proceedings was the antithesis of Mr Wilson’s duty to facilitate the timely and efficient administration of justice. He submitted that Mr Wilson’s conduct had visited manifest unfairness upon himself and other litigants waiting in the queue, frustrating the objectives identified in s 5A of the Act.
83․Mr Allen argued that Mr Wilson’s conduct had been inconsistent with the “timely and efficient administration of civil justice” that Gageler J recognised as a key consideration in UBS v Tyne at 104 [72] and 107 [80]. As such, he argued, permitting Mr Wilson’s claim to proceed would be tantamount to the Court lending its procedures to the staged conduct of one dispute carried out by related parties under common control with the attendant duplication of resources, delay, expense, and vexation. He submitted that allowing this to happen was likely to give rise to the perception that the administration of justice is inefficient, and the Court is careless of costs and profligate in its application of public moneys.
84․Mr Allen submitted that the proceedings ought to be permanently stayed to end the unjustifiable oppression that was being occasioned at his expense and to prevent the administration of justice being brought into disrepute. He argued that, as described in UBS v Tyne at 100 [58] by Kiefel CJ, Bell and Keane JJ, this oppression was found in the “significant delay in the resolution of the dispute”, “increased costs”, and “the vexation of being required to deal again with claims that should have been resolved” in the first proceedings.
85․Additionally, Mr Allen submitted the present proceedings were an abuse of process as Mr Wilson’s claim again Mr Allen is doomed to fail. He submitted that this is because he had an “interest in land” within the meaning of s 104 of the LTA pursuant to the “Deed of Agreement” dated 17 August 2016 and executed 11 November 2016.
The plaintiffs
86․For simplicity, I shall refer to the plaintiffs in this judgment collectively as “Mr Wilson”.
87․Mr Wilson submitted that, as the leave to withdraw the original caveat claim was granted by McWilliam AsJ, it is discordant with r 1167 of the Rules for Mr Allen to rely on the withdrawal in support of the stay application. He submitted the stay application should be dismissed because it is made in circumstances where:
(a)there has been no judicial determination of the matter, on the merits or otherwise;
(b)Mr Allen has a costs order in his favour for the whole of the original caveat claim, such that he is not being put to the same expense more than once; and
(c)Mr Allen seeks to obtain a result which is contrary to that which is provided for under the Rules and contrary to the premise of the application for leave to withdraw.
88․In response to Mr Allen’s submission that Mr Wilson’s claim was an abuse of process of the kind considered in UBS v Tyne because it could have been brought in the first proceedings, Mr Wilson submitted that it was in fact not possible for the claim to have been litigated fully and completely in the first proceedings because:
(a)The second and third plaintiffs to the present proceedings were not parties to the first proceedings, meaning they were unable to put on evidence of any loss suffered by reason of the caveat. Mr Wilson argued that UBS v Tyne is distinguishable on the basis that the entities related to Mr Tyne had been parties to the earlier proceedings before discontinuing, whereas in this case the second and third plaintiffs’ claim for loss and damage was never the subject of proceedings and thus could not have been determined in the first proceedings.
(b)Mr Wilson was denied a real opportunity to explore or know about key factual issues surrounding the caveat because:
(i)In the course of Mr Nyman’s evidence in chief in the first proceedings, he gave an explanation in relation to the succession of caveats which were lodged by Mr Allen which had not been heard before.
(ii)In the course of Mr Nyman’s cross-examination in the first proceedings, he gave evidence, which again had not been heard before, regarding the advice he gave to Mr Allen in relation to the caveat.
(iii)There was no capacity for the fresh evidence given by Mr Nyman in the first proceeding in relation to the caveats to be explored in cross-examination of Mr Allen, who had already given evidence, or for Mr Wilson to otherwise sheet home this advice to Mr Allen, his case having closed later that day. Further, any submissions Mr Wilson may have made about Mr Nyman’s advice and the reasonableness or otherwise of Mr Allen’s reliance upon it would have been precluded under the rule in Browne v Dunn (1894) 6 R 67 (Browne v Dunn).
As such, Mr Wilson submitted that it was not possible, in light of the new information that emerged during Mr Nyman’s evidence at the hearing, for the original caveat claim to be litigated fairly to conclusion.
(c)Mr Wilson needed to join Mr Nyman and KPW Lawyers to the proceedings.
89․Mr Wilson submitted that for these reasons, the claim brought in the present proceedings could not have been brought as part of the original caveat claim.
90․In relation to Mr Allen’s submission that the Court ought to infer Mr Wilson withdrew the original caveat claim to gain a forensic advantage because of what ordinary experience suggests Mr Wilson, Mr Nyman or his previous counsel would or would not have done in such circumstances, Mr Wilson argued that, in accordance with the principles espoused in Browne v Dunn, Mr Allen could not make such submissions without first putting the allegations to the relevant witnesses and thereby providing them with an opportunity to respond.
91․Additionally, Mr Wilson submitted that the present proceedings could be further distinguished from UBS v Tyne on the basis that there has been no determination, on the merits or otherwise, of Mr Wilson’s claim for damages under s 108 of the LTA. Contrastingly, he submitted, the High Court of Singapore had already heard and dismissed the relevant claim in UBS v Tyne and the High Court held that such determination was sufficient to engage the principles of abuse of process. Mr Wilson argued that his claim remains undetermined, and he is prima facie entitled to have it decided by this Court.
92․He further argued that the present proceedings are distinguishable from UBS v Tyne in that the hypothetical scenario described by Kiefel CJ, Bell and Keane JJ at 98 [52] is precisely what occurred in the present proceedings, namely “[w]here discontinuance of proceedings bring the proceedings to an end, the later commencement of fresh proceedings may work no unfairness on the defendant.”
93․He submitted that the circumstances of the withdrawal of the original caveat claim could not have led to the inference that the dispute regarding the caveat was at an end, noting the express terms of the withdrawal application. He submitted that this conclusion is fortified by the terms of r 1167 of the Rules, which expressly leaves a dispute that is withdrawn open for later determination. He submitted that the dispute has expanded since the time of the withdrawal to involve Mr Nyman and KPW and is far from concluded.
94․Notably, Mr Wilson acknowledged the existence of authorities other than UBS v Tyne to the effect that bringing proceedings in relation to an issue which ought reasonably to have been raised for determination in an earlier proceeding, but was not, can constitute an abuse of process. However, he submitted that, even on an expanded view, the present proceedings did not constitute an abuse of process because it was not possible for the issues raised in these proceedings to have reasonably been raised in the first proceedings. He submitted that raising and fairly determining such issues in the first proceedings would have involved a concomitant delay and expense at least equal to the costs likely to be incurred in running the present, second proceedings.
95․Mr Wilson submitted that an additional factor that goes against staying the proceedings is the fact that McWilliam AsJ granted leave to withdraw the original caveat claim in the first proceedings, causing him to adopt the present course.
96․He drew attention to the costs condition her Honour placed on the withdrawal, being an order that he paid Mr Allen’s costs in relation to the whole of the original caveat claim. He argued that as a result of this costs order, Mr Allen will not be put to the same expense twice as Mr Allen already had an order compensating him for earlier costs thrown away. He submitted that the costs order in favour of Mr Allen covers evidence put on about matters already raised in the first proceedings. He contended that any costs related to evidence about the new factual matters raised by Mr Nyman would be incurred by Mr Allen for the first time. As such, he submitted, Mr Allen is not put to the same expense twice.
97․Mr Wilson submitted that as common issues of fact and law arise as between Mr Allen and the second and third defendants, it is appropriate such issues are determined together, at one time, as part of a single proceeding.
98․Mr Wilson submitted that Mr Allen’s involvement in the dispute would not end even if the proceedings were stayed as against him, as Mr Allen is a necessary witness to what advice he did or did not receive from the second and third defendants. He submitted that Mr Allen would still be subject to the stress and distraction of participating in litigation as Mr Allen would likely be asked to provide affidavit evidence by the other defendants and be subject to examination.
99․Mr Wilson further submitted that the present proceedings are not a cynical use of the Court’s processes as a way to gain a forensic advantage. He drew attention to South Townsville Developments Pty Ltd (in liq) v Lauvan Pty Ltd [2019] FCA 666, wherein Stewart J identified at [55] a number of factors distinguishing that case from UBS v Tyne, which Mr Wilson submitted are applicable to the present proceedings.
100․In relation to Mr Allen’s submission that Mr Wilson’s claim against Mr Allen is doomed to fail, Mr Wilson submitted that it is not appropriate to delve into an assessment of the merits of his claim to determine the strength of it at this point in the proceedings. He argued that it is presently sufficient that his claim is arguable, which he submitted is apparent from Mr Allen’s submissions on the merits. Mr Wilson submitted that Mr Allen’s contention that lodging the caveat was not done with an ulterior motive belies the fact that Mr Wilson was not able to cross-examine Mr Allen in the first proceedings about the matters arising from Mr Nyman’s evidence at hearing. He submitted that such motive may emerge at trial, and it would be improper to determine that issue at an interlocutory stage.
101․Mr Wilson concluded that it is well established that a permanent stay should only be granted in exceptional circumstances, and this is not one of them.
Mr Allen in reply
102․Mr Allen took issue with Mr Wilson’s submission that Browne v Dunn precluded Mr Allen from making submissions about the forensic advantage Mr Wilson sought to gain from withdrawing the original caveat claim.
103․Mr Allen drew attention to the statements of Hunt J in Allied Pastoral Holdings Pty Ltd v FCT [1983] 1 NSWLR 1 (Allied Pastoral) at 16 and 23 about the rule in Browne v Dunn, as cited in JD Heydon, Cross on Evidence (online, LexisNexis, 2023) at [17435] and [17440]:
It has in my experience always been a rule of professional practice that, unless notice has already clearly been given of the cross-examiner's intention to rely upon such matters, it is necessary to put to an opponent's witness in cross-examination the nature of the case upon which it is proposed to rely in contradiction of his evidence, particularly where that case relies upon inferences to be drawn from other evidence in the proceedings. Such a rule of practice is necessary both to give the witness the opportunity to deal with that other evidence, or the inferences to be drawn from it, and to allow the other party the opportunity to call evidence either to corroborate that explanation or to contradict the inference sought to be drawn. That rule of practice follows from what I have always believed to be rules of conduct which are essential to fair play at the trial and which are generally regarded as being established by the decision of the House of Lords in Browne v Dunn (1894) 6 R 67.
…
The situation in which most problems arise, and that which arose in the present case, is where the witness is not given the opportunity to deal with the other material upon which the challenge is based and where the relevance of that evidence to the challenge is not immediately apparent. Usually, but not always, such a challenge will be based upon some inference which arises from that other evidence in the case.
104․He drew attention to Cross on Evidence at [17435], where it is said that the rule in Browne v Dunn “applies not only to party-witnesses but to other witnesses — particularly since witnesses who are not parties have no capacity to object to attacks on them by a party.” In support of this proposition, Mr Allen pointed to Bale v Mills [2011] NSWCA 226; 81 NSWLR 498 (Bale v Mills), in which Allsop P, Giles JA and Tobias AJA said at 515 [66]:
Fairness in the administration of justice extends not only to ensuring a fair trial for the actual parties but also to ensuring that a witness who is not a party is treated fairly. It is especially important in circumstances such as the present, where a witness such as Mr Schipp had himself no right to object to his credit being impugned with respect to the Centrelink representation and where he was not given the opportunity to respond to what was clearly an extremely serious allegation not only going to his credit as a witness but also, as the primary judge was at pains to emphasise, to his honesty as a person and to his probity as a solicitor and an officer of the court. Further, the unfairness consequential upon the breach struck directly at the entitlement of the appellants to a fair hearing and procedural fairness in the making of findings by the District Court.
105․Mr Allen submitted that, having considered the above authorities and the broader discussion in Cross on Evidence, the rule in Browne v Dunn does not require him to have called Mr Wilson’s previous legal representatives, including his then-counsel, to provide them with an opportunity to respond to the submissions.
106․There are three aspects of the rule in Browne v Dunn that Mr Allen submitted support this conclusion.
107․Mr Allen argued that firstly, the rule is expressed as applying to matters that ought to be put to “an opponent’s witness in cross-examination”: Allied Pastoral at 16. He submitted that their Honours made it clear in Bale v Mills that the rule applies to both witnesses who are parties and witnesses who are not parties. However, he submitted, the rule does not apply to people who have not been called to give evidence. Nor, he argued, does the rule impose any positive obligation to call people to give evidence.
108․Secondly, he submitted that Browne v Dunn does not apply where the witness is already on notice to the challenge to be made to their evidence: Allied Pastoral at 16; Cross on Evidence at [17445]. He contended that Mr Wilson was put on notice of the submissions at issue and if he wished to challenge the inferences sought, he was provided reasonable and sufficient notice to afford to him the opportunity to call evidence in response. Mr Allen submitted that an inference lies in Mr Wilson’s forensic decision not to do so.
109․Finally, Mr Allen submitted that the rule in Browne v Dunn is directed towards preventing an unfair attack on a witness. He noted that, for the avoidance of doubt, his submissions do not criticise the conduct of Mr Wilson’s previous legal representatives or counsel or suggest that they engaged in any improper conduct. Rather, Mr Allen submitted that:
(a)An inference is objectively available on the material before the Court that Mr Wilson’s previous counsel likely realised upon review of the evidence that the original caveat claim was highly likely to fail due to the inadequacy of the evidence as to causation.
(b)Mr Wilson’s previous counsel likely perceived that the evidence given by Mr Nyman was sufficient to give rise to a basis upon which to apply for leave to withdraw the original caveat claim (namely to join Mr Nyman and KPW Lawyers as defendants) without requiring the inadequacy of the evidence as to causation be raised.
(c)Mr Wilson’s previous counsel’s duty to the Court, on an inter partes application in adversarial proceedings in which each party enjoyed legal representation, did not require him to disclose, against the interests of Mr Wilson, other or additional forensic motives underlying Mr Wilson’s application to withdraw the counterclaim beyond the stated desire to join further defendants. Such an application did not engage duties of candour by Counsel such as apply on an ex parte application to the Court.
(d)At the hearing of the first proceedings, McWilliam AsJ was persuaded to grant leave to Mr Wilson to withdraw the original caveat claim upon the basis advanced by Mr Wilson’s previous counsel notwithstanding submissions opposing the grant of leave made by Mr Allen.
(e)In the circumstances, Mr Wilson’s previous counsel achieved the forensic advantage for his client of obtaining leave to withdraw a claim that was highly likely to fail and, in addition, preserved a chance for Mr Wilson to run the claim a second time without risking exposure of, and with the potential benefit of remediating, the unidentified inadequacy of Mr Wilson’s evidence.
110․In circumstances where Mr Wilson’s withdrawal application in the first proceedings was fully contested and neither party alleged that Mr Wilson’s previous counsel engaged in any improper conduct, Mr Allen submitted that there is no need for the Court to consider whether a duty of further candour to the Court arose.
111․Mr Allen further submitted that it is not necessary for the Court to make findings as to whether Mr Wilson ever actually intended to join the further defendants. The crucial point advanced by Mr Allen is that, insofar as Mr Wilson did intend to join the further defendants:
(a)on an objective assessment, the facts identified above demonstrate that the intent to join the further defendants could not have been a significant driving force behind his application to withdraw the original caveat claim;
(b)in those circumstances, the desire to join further defendants ought not be regarded as a significant part of the explanation for Mr Wilson’s decision to withdraw the original caveat claim; and
(c)it is appropriate for the Court to infer that the predominant explanation for Mr Wilson seeking leave to withdraw the original caveat claim was the desire to obtain an opportunity to improve upon his evidence.
112․Mr Allen submitted that the inference sought is not only open upon the facts but compelling as a matter of ordinary experience. He argued that if Mr Wilson enjoyed a sound claim supported by sufficient evidence in the first proceedings, experience suggests Mr Wilson would have maintained it and not incurred the cost and delay of withdrawing and bringing the claim a second time.
113․Mr Allen submitted that, in the absence of written or oral evidence from Mr Wilson to advance an explanation for his decision to withdraw the original caveat claim, the Court would be more confident in drawing inferences favourable to Mr Allen and in inferring that evidence from Mr Wilson would not have assisted his case. He drew support for this submission from the statements made in Jones v Dunkel (1959) 101 CLR 298 at 308 by Kitto J, at 312 by Menzies J, and at 321 by Windeyer J, as upheld in Kuhl v Zurich Financial Services Australia Ltd [2011] HCA 11; 243 CLR 361 at 385 [64] by Heydon, Crennan and Bell JJ.
Consideration
114․Every case is different and must be judged according to its own facts and circumstances notwithstanding certain parallels and similarities with the facts and circumstances of other cases, such as the authorities cited to me on this application. That is not to deny the usefulness of those authorities, only to make the point that their usefulness has limits.
115․Mr Allen submitted that the facts of this case are such that it amounts to a greater abuse of process than was the case in UBS v Tyne. In that submission, the “facts” relied upon are primarily the factual findings Mr Allen contends I should make as to the “predominant driving force behind Mr Wilson’s application to withdraw the original caveat claim”.
116․I’ll address the five factors relied on by Mr Allen before turning to more general considerations.
Factor 1
117․There is no doubt that the original caveat claim could have been pursed in the first proceedings.
Factor 2
118․However, I am not persuaded that the original caveat claim should have been pursued in the first proceedings given the explanation for its withdrawal provided to McWilliam AsJ by Mr Wilson’s counsel at the time.
119․I accept that explanation at face value. It was provided by counsel in Court and has not been the subject of cross-examination on this application. I do not accept Mr Allen’s submission that Browne v Dunn does not apply in the circumstances of this case.
120․In this case, Mr Wilson relied on the transcript of what his previous counsel told McWilliam AsJ were the reasons for the application to withdraw. Mr Allen says I should not accept that evidence and I should find that the motivation for the withdrawal application was otherwise than as stated by counsel to McWilliam AsJ, but without putting those propositions to that counsel in cross-examination and giving that counsel the opportunity to answer them.
121․It is true, as Mr Wilson submitted, that Mr Allen had not obtained and relied on an affidavit from counsel, and so in that sense counsel was not a witness. But Mr Allen tendered the transcript of what counsel had told McWilliam AsJ and thus what counsel said to McWilliam AsJ was in evidence. In that sense, that counsel was a witness because Mr Allen was relying on what that counsel had told McWilliam AsJ.
122․Browne v Dunne, as for many principles of law, is a matter of substance, not form. It is based fundamentally on fairness. Mr Allen was reliant on what counsel had told McWilliam AsJ, and Mr Wilson desired to submit I should not accept that evidence and that I should make a finding to the effect that what was told to McWilliam AsJ was at least inaccurate, and at most a deliberate misrepresentation.
123․As a matter of substance therefore, and fairness, Mr Wilson needed to put his alternative hypothesis to counsel in cross-examination. He could have done so not by calling that counsel as a witness in his own case (as he submitted), but he could have requested Mr Allen to make counsel available for cross-examination pursuant to s 166(f) and 167(a) of the Evidence Act 2011 (ACT) (the Evidence Act) or the Court’s inherent jurisdiction to ensure a fair hearing. Alternatively, he could have subpoenaed counsel to attend and give evidence and asked for leave to cross-examine counsel under s 38 of the Evidence Act.
124․I do not accept Mr Allen’s submission that his written submissions dated seven days before the hearing of the application suggesting there were reasons to doubt that a desire to join the solicitors was a significant force driving Mr Wilson’s application to withdraw the original caveat claim, and that the Court ought infer that the predominant driving force behind the application to withdraw the original caveat claim was the desire to obtain a forensic advantage, and to improve upon the state of the evidence as to the effect of the caveat upon his dealings, was sufficient or adequate notice of the relevant matters thus obviating the need for cross-examination.
125․In my view, that “notice” was too late as it only allowed four full working days for Mr Allen’s legal advisors to obtain any additional evidence from that counsel, assuming he was available. Further, the submissions made by Mr Allen are really by way of speculation rather than being inferences that could be drawn from other available evidence.
126․I also do not accept the submission that, in substance, there was no attack on Mr Allen’s previous counsel’s evidence (as to the reasons for the application to withdraw as set out in the transcript) because it would have been acceptable conduct of that counsel to provide McWilliam AsJ with one explanation whilst not disclosing the other “predominant” reasons for the application (which Mr Wilson submits I should now find were the real, operative reasons for the application).
127․Counsel’s duty of candour to the Court is not limited, as Mr Wilson submitted, to ex parte applications alone.
128․Rule 21 of the Legal Profession (Barristers) Rules 2021 (ACT) says that a barrister must not knowingly make a misleading statement to a court on any matter. In my view, it would be misleading for a barrister to submit to a judge that the reason for an application was reason A when the predominant reason was reason B. It should also be remembered that a barrister’s paramount duty is to the Court.
129․However, even if I were wrong about the application of Browne v Dunn in this case, I would not make the factual finding urged upon me by Mr Allen.
130․On the one hand, I have the transcript of what counsel told McWilliam AsJ. On the other, I am asked to draw inferences from what really amounts to speculation. Mr Allen relied on three factors.
131․First, he submitted that neither Mr Wilson nor his then counsel considered the prospects of making a claim against the second and third defendants to be worth mentioning to the solicitor with carriage of the matter and cited my decision in Wilson at [89], in which I said:
But there is an explanation for the failure to name Mr Nyman and KPW as parties when the originating claim and statement of claim was first filed. Had the plaintiff’s solicitor engaged in proper communication with counsel who represented his client in the first proceedings, or read the transcript of the application to withdraw, Mr Nyman and KPW would have been named as parties when these proceedings were commenced. However, in my view those omissions should not be visited on Mr Wilson personally.
132․What I said was that there was a lack of “proper communication”. That is different from something “not worth mentioning”.
133․Second, Mr Allen submitted that upon receiving Mr Allen’s permanent stay application, Mr Wilson did not file an application seeking to join the solicitors until after the exchange of submissions made clear that his position would be indefensible unless he applied to join them.
134․Whilst the submission is correct in terms of the chronology, I do not accept that the late filing of the application to add the second and third defendants was for the reason suggested. That is mere speculation, in my view. The fact is that Mr Wilson has taken the significant step of adding two defendants with all of the attendant costs consequences should he fail in his claim against them. True it is they should have been joined earlier if Mr Wilson’s solicitors had acted more professionally and with greater attention, but I find that their failure to do so was because of the absence of those factors rather than because the joining of the second and third defendants was not the driving force behind the withdrawal application.
135․Thirdly, Mr Allen submitted that there were clear reasons to doubt the prospects of Mr Wilson succeeding against the solicitors, citing my judgment in Wilson at [92]-[93]. Whatever may be the strength or weakness of the case against the second and third defendants, the fact remains that Mr Wilson has taken the significant step of adding those two defendants with all of the attendant costs consequences. If one assumes those cases will be lost, Mr Wilson would be incurring debts probably in the order of several or many tens of thousands of dollars. That seems to me to be a very poor investment if its purpose was simply to avoid running the caveat case in the first proceedings.
136․Of course, the third factor is mere speculation unsupported by any facts or evidence.
137․Therefore, in my view, and I so find, the reasons why the original caveat claim was withdrawn in the first proceedings were for the reasons Mr Wilson’s previous counsel advanced to McWilliam AsJ.
Factor 3
138․It is correct to say, as Mr Allen submitted, that the failure to bring the caveat claim in the first proceedings has delayed the resolution of all disputes between the parties.
Factor 4
139․It is correct to say, as Mr Allen submitted, that the failure to bring the caveat claim in the first proceedings would probably increase the costs burden on the parties.
140․The order for costs in Mr Allen’s favour made in relation to the withdrawal of the original caveat claim in the first proceedings did not indemnify him against all the costs he incurred, nor was there a complete identity between the professional work done on his behalf on the original caveat claim in the first proceedings and the work needed to be done in the second proceedings. In addition, some work will need to be duplicated, such as the preparation for hearing, the re-reading of evidence etc.
141․Nevertheless, other than those general statements, there was no evidence estimating what those wasted or extra costs may be. There was evidence that Mr Allen had spent $205,000 in the first proceedings and $30,000 on the second proceedings, but there was no evidence of the costs incurred solely in relation to the original caveat claim in the first proceedings, and how much of the costs incurred in the second proceedings related to extraneous matters such as this application and the plaintiff’s application to amend.
142․Therefore, whilst satisfied that Mr Allen will incur some extra costs, there is no evidence which would satisfy me that those extra costs are of a significant amount.
Factor 5
143․It is correct to say, as Mr Allen submitted, that the failure to bring the caveat claim in the first proceedings would increase the stress and inconvenience experienced by Mr Allen. That is a matter that has weighed heavily in my mind given Mr Allen is not a large commercial organisation nor a habitual litigant (such as insurance companies for example) and thus he will probably feel those stresses more than those other litigants.
144․His evidence on those matters has been set out above, but I do not attach a great deal of weight to it because the evidence consisted of various assertions of fact rather than evidence proving those facts. That is, for example, he asserted that the dispute with Mr Wilson had had a significant psychological toll upon him, that it had been “an extremely stressful and destructive 6-year process”, and that he felt the disputes had “ruined [his] life”. He said he sees himself as much less confident, significantly less social, constantly worried about money and suffering from “chronic and severe anxiety and suicidal thoughts”. Mr Allen recalled the experience of being cross-examined in the first proceedings as being a “very difficult and unpleasant experience”.
145․Whilst some of those matters, such as the experience of cross-examination, may be accepted, there was no medical or other corroborative evidence supporting the opinions that his life had been “ruined”, that he was less confident, less social etc. The evidence also does not allow me to distinguish between the stress caused by the first proceedings (which would have been suffered in any event) and the extra stress presumably caused by the commencement of the second proceedings. Although Mr Allen’s evidence was not challenged, I did not regard it as particularly persuasive given it amounted to, in substance, a number of assertions not corroborated by evidence of underlying or subordinate facts.
146․Therefore, whilst I accept that there will be additional stress etc suffered by Mr Allen, the evidence does not allow me to find that that extra stress is of a significant magnitude.
General Considerations
147․The authorities are clear that a permanent stay should only be granted in exceptional circumstances. In my view, the circumstances of this case do not amount to exceptional circumstances.
148․In my view, the critical factor that persuades me that the second proceedings are not an abuse of process is that the application to withdraw the original caveat claim arose after certain oral evidence (the new evidence) had been given by a witness which had otherwise not been known to Mr Wilson and on which Mr Wilson wishes to rely in his present caveat claims.
149․In Tyne v UBS (No 2), Dawson J found at 352 [23]:
… if the Trust considered that it had a good claim, and did not intend to abandon it, then it should have taken it to judgment in those proceedings. There is no suggestion that anything happened unexpectedly thereafter, leading the Trust to change its mind about its claim, or its intention to prosecute it.
150․Here, something did happen unexpectedly, leading Mr Wilson to change his mind about the original caveat claim. The result of the new evidence arising during the hearing of the first proceedings was that Mr Wilson arguably did not have a “sufficient opportunity” to plead his case in a way that would have facilitated a just resolution.
151․In saying this, I make no judgment about the new evidence or the strength or otherwise of the caveat claims. My point is simply that, on the evidence before me, that evidence was new in the sense that it was not previously known to Mr Wilson, and he wishes to rely on it in his caveat claims.
152․Further, in contrast to the circumstances in UBS v Tyne, where Gageler J said at 106 [76] that there had been no intimation to UBS that Mr Tyne was likely to pursue the trust’s claims in later proceedings, it is not contentious in these proceedings that Mr Allen was aware of the intention to commence the second proceedings.
153․The circumstances in which these second proceedings have been brought are the opposite of the kind of proceedings that McWilliam AsJ suggested may constitute an abuse of process in Findex at [73]:
It may have been an abuse of the court’s processes if the plaintiffs had not notified the defendant of any intention to bring proceedings of the kind now brought, so that the defendant was in the position of being entitled to assume that the Restraint proceedings represented the totality of the claims to be made against him and that the dispute was at an end (as was the case in UBS v Tyne, see [58]).
154․It is true, however, that that reason does not explain the failure to join the present second and third plaintiffs as counterclaimants to the counterclaim in the first proceedings. But it does explain why Mr Wilson now considers he needed to join the second and third defendants. Again, I make no comment or finding about the merits of that claim, only that the explanation given to McWilliam AsJ had a basis and explains why the withdrawal application was made and these second proceedings commenced.
155․The evidence does not persuade me that the second proceedings have been brought for an illegitimate or collateral purpose, nor that there was a dominant motive to achieve a forensic advantage (or avoid a forensic disadvantage) in withdrawing the original caveat claim in the first proceedings. In that sense, and on the evidence, I do not find that the caveat claims should have been brought in the first proceedings.
156․I accept that Mr Allen will incur some additional costs, that there will be a delay in the finalisation of all claims between he and Mr Wilson, and that there will be additional stresses and strains on Mr Allen.
157․But balancing those matters out against the significance of making a draconian order to permanently stay the second proceedings, taking into account the principles mentioned in the authorities and the facts and circumstances of this case, I do not think it appropriate to grant the order sought.
Miscellaneous
158․During submissions it became apparent that deficiencies remain in the plaintiff’s pleading notwithstanding an amended pleading which was filed in accordance with an order I made in Wilson, and in particular at [27]-[28].
159․The now joined second and third defendants also flagged the possibility of filing a strike out or summary judgment application pursuant to r 6015 of the Rules (which refers to the ability to make an application to set aside an originating process rather than striking out or summary dismissal) for which an extension of time was probably required.
160․Time for defences and that application was extended on the day the first defendant’s application was heard until further order, with me to fix a time for the doing of those various things in this judgment. Accordingly, I shall make those orders below.
161․It is appropriate that if the second and third defendants are to file the application foreshadowed, that they should also file and serve their defences.
Costs
162․In Wilson, I ordered at [99] that the issue of costs in relation to that application be deferred and determined at the same time as the costs of this application.
163․It should be noted that r 1728 of the Rules says that if the Court reserves the costs of an application in a proceeding, the costs reserved become costs in the cause, unless ordered otherwise.
164․Mr Wilson succeeded in his amendment application in Wilson. However, a party seeking an indulgence of the Court will ordinarily be required to pay costs, even if the relief sought in the application was granted: Golski v Kirk (1987) 14 FCR 143 at 157 per Beaumont J; Theodorelos v Nexus Projects Pty Ltd [2009] ACTSC 149; 19 ACTLR 1 at 25 [132]; Milhem v Sam’s Carpentry Pty Ltd (in liquidation) & IC Formwork Services Pty Ltd (No 2) [2023] ACTSC 61 at [13]. Further, r 1726(2) of the Rules says that a party who amends a document must pay the costs of and caused by the amendment, unless the Court otherwise orders.
165․Mr Wilson has succeeded in his defence of Mr Allen’s application for a permanent stay and ordinarily costs should follow the event.
166․However, Mr Wilson only filed his amendment application after Mr Allen had filed his application for a permanent stay and, in reality, in response to it. In other words, Mr Wilson’s application, which should never have been necessary, was precipitated by Mr Allen’s application.
167․In my view, Mr Wilson should pay the costs of the amendment application the subject of my judgment in Wilson. Mr Wilson should also pay Mr Allen’s costs of the permanent stay application up until the date of my judgment in Wilson, being 13 September 2023. Thereafter, as Mr Allen pursued and lost his application for a permanent stay, Mr Allen should pay Mr Wilson’s costs of that application.
Orders
168․For those reasons, the following orders are made:
(1)The first defendant’s amended application in proceeding filed on 3 August 2023 is dismissed.
(2)The plaintiff is to pay the first defendant’s costs of the plaintiff’s application determined in Wilson v Allen [2023] ACTSC 257.
(3)The plaintiff is to pay the first defendant’s costs of the first defendant’s amended application in proceeding filed on 3 August 2023 up to and including 13 September 2023.
(4)The first defendant is to pay the plaintiff’s costs of the first defendant’s amended application in proceeding filed on 3 August 2023 incurred after 13 September 2023.
(5)The plaintiff is to file and serve a further amended statement of claim in relation to paragraphs 27 and 28 of the present statement of claim on or before 16 February 2024.
(6)The defendants are to file and serve defences to the further amended statement of claim on or before 15 March 2024.
(7)To the extent necessary, the second and third defendants are granted leave to file and serve any application under r 6015 of the Court Procedure Rules 2006 (ACT) on or before 15 March 2024.
| I certify that the preceding one hundred and sixty-eight [168] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Acting Justice Curtin Associate: Date: |
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