Winky Pop v Mobil

IN THE SUPREME COURT OF VICTORIA AT MELBOURNE

Not Restricted

COMMON LAW DIVISION

VALUATION, COMPENSATION & PLANNING LIST

S CI 2009 6345

WINKY POP PTY LTD (ACN 082 744 769) and OR AUSTRALIA PTY LTD (ACN 073 102 520	Plaintiffs
and
MOBIL REFINING AUSTRALIA PTY LTD (ACN 004 300 163)	First Defendant
and
THE STATE OF VICTORIA	Second Defendant

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JUDGE:	Digby J
WHERE HELD:	Melbourne
DATE OF HEARING:	4 May 2017
DATE OF JUDGMENT:	28 February 2018
CASE MAY BE CITED AS:	Winky Pop v Mobil
MEDIUM NEUTRAL CITATION:	[2018] VSC 82

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PRACTICE AND PROCEDURE – Application by second defendant for final judgment – No real prospect of success as a result of outcome of trial against separate defendant – Issue estoppel – Anshun estoppel – Preclusive abuse of process by plaintiffs – Application by plaintiffs to amend statement of claim and related additional evidence – Rejected – Prejudice – Civil Procedure Act 2010 (Vic), ss 7, 8, 9 and 63

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr P Collinson QC with Mr S Senathirajah SC	King & Wood Mallesons
For the First Defendant	Ms K O’Gorman	Ashurst
For the Second Defendant	Mr S Horgan QC with Ms E Latif	Clayton Utz

HIS HONOUR:

The Applications

On 13 July 2015, after a lengthy trial, judgment was handed down in this proceeding dismissing the claims of the plaintiffs, Winky Pop Pty Ltd and OR Australia Pty Ltd (‘the plaintiffs’) against the first defendant, Mobil Refining Australia Pty Ltd (‘Mobil’).[1]
[1]Winky Pop v Mobil [2015] VSC 348 (‘the 2015 Judgment’).

On 19 October 2015, final orders were made in this proceeding. The plaintiffs’ claims against the second defendant, the State of Victoria (‘the State’), were adjourned to a future date.[2]
[2]Winky Pop v Mobil (Costs) [2015] VSC 580.

By summons filed 16 March 2017, the State brought an application for summary judgment in this proceeding against the plaintiffs pursuant to s 63 of the Civil Procedure Act 2010 (Vic) (‘the Act’), on the basis that the plaintiffs’ residual claims against the State have no real prospect of success. In support of its application, the State relies on two affidavits of Philippa Jane Mitchell, sworn 16 March 2017 and 3 May 2017.

By oral application made during argument in relation to the State’s application for summary judgment,[3] the plaintiffs seek leave to amend their pleading against the State. In this application, the plaintiffs rely on the affidavit of Mark Anthony Troiani of 13 April 2017 (‘the Troiani affidavit’).[4] The plaintiffs seek to add a claim in nuisance against the State on the basis that, since the 2015 Judgment, further facts have arisen relevant to their claims against the State.
[3]The plaintiffs’ oral application for leave to further amend its Statement of Claim and to file further affidavit evidence, was made on 4 May 2017 (foreshadowed at [50]-[55] of the Plaintiffs’ Written Submissions, 1 May 2017) and the proposed amendments are set out in their proposed Second Further Amended Statement of Claim dated 28 April 2017, [41]-[50]. The second defendant does not take issue with the informality or late service of the plaintiffs’ applications, T35.12-17, T96.21-T97.1.
[4]T97.31-T98.13.

The State opposes the plaintiffs’ application to amend. It submits that the plaintiffs are estopped from amending their pleaded case. The State also seeks certain varied costs orders.

Background
The Proceeding

In the 2015 proceeding, the plaintiffs brought an action against Mobil. The action was principally in negligence, but also in nuisance and for breach of the Pipelines Act 2005. Mobil admitted liability in relation to the plaintiffs’ case in negligence and for breach of the Pipelines Act 2005.[5]
[5]Mobil’s Further Amended Defence, 21 December 2012, [13], [15], [18], [27]-[29].

In the same proceeding, an action in negligence was also brought against the State. The claim for damages was pleaded in the same terms.[6]
[6]The damages case against the State was pleaded in terms identical to the damages case pleaded against Mobil.

Against both defendants, the damages claimed included a component particularised as ‘the diminution in the value of the plaintiffs’ land’.[7]
[7]Plaintiffs’ Further Amended Statement of Claim, 18 December 2012, [19], [25] and [39]; Plaintiffs’ Further and Better Particulars, 13 November 2009, [2(d)] and [2(f)]; 19 October 2011, [2(a)] and [2(b)].

The procedural background, including as referred to in the uncontroversial parts of the State’s affidavit material, is as follows:[8]
[8]Affidavit of Philippa Jane Mitchell, 16 March 2017, [3]-[16]. Paragraphs [17]-[19] and Exhibits ‘PJM-10’, ‘PJM-11’ and ‘PJM-12’ (inclusive) were redacted and the admission of those parts of the Affidavit were not pressed by the second defendant.

(a)By summons dated 14 September 2012, the plaintiffs applied to join the State to the proceeding as second defendant. The application was opposed by Mobil and the State on numerous grounds including that there was no utility in joinder of the State where Mobil had admitted breach of its duty of care and the damage claimed against the State was the same as the damage claimed against Mobil.
By orders made on 30 November 2012, the State was joined to this proceeding.
(b)By reference to paragraphs [19], [25] and [39] of the Further Amended Statement of Claim dated 18 December 2012 it is clear that the plaintiffs’ case in damages against the State in this proceeding is the same as its case in damages against Mobil.
Plaintiffs’ Submissions seeking to join the State
(c)The plaintiffs’ submissions on their application to have the State joined as the second defendant included that:
(i)the loss and damage alleged by the plaintiffs is the same as against the State and Mobil;[9]
[9]Plaintiffs’ Submissions, 29 November 2012, [23(n)], see above.
(ii)the extent of the plaintiffs’ claimed loss and damage is likely to be in issue for the State as it is for Mobil;[10]
[10]Ibid [23(n)].
(iii)questions relating to the State are matters which are also referred to, and arise from the claims made by the plaintiffs against Mobil, including the question of what loss and damage has been suffered by the plaintiffs;[11]
[11]Ibid [23(k)].
(iv)it would be just and convenient to have the plaintiffs’ claims against the State determined in the same proceeding in which the plaintiffs’ claims against Mobil were determined, including because the Act directs that in exercising its powers under the Rules, the court shall ensure the effective, complete, prompt and economical determination of questions in proceedings;[12]
[12]Ibid [26].
(v)refusing the plaintiffs leave to join the State to this proceeding would result in the certainty of a further proceeding being filed by the plaintiffs against the State. Such an outcome would be inconsistent with the effective, economical and efficient conduct of the business of the Court and the resolution of issues in this proceeding because, for example, in any subsequent proceeding the State is likely to adopt a similar defence to Mobil in relation to the question of the loss and damage suffered by the plaintiffs and allege that the plaintiffs’ loss and damage should not be assessed by reference to any loss of opportunity to develop the plaintiffs’ land for residential purposes;[13]
[13]Ibid [27(a)].
(vi)the avoidance of a multiplicity of proceedings would therefore be consistent with the effective, economical and efficient conduct of the business of the Court and the resolution of all issues in this proceeding and in any subsequent proceeding that would be required to be brought against the State,[14]
[14]Ibid [29].

as detailed below.
(d)By paragraph [3] of the Orders made 14 December 2012, it was ordered that:
Save for the filing of a defence … the second defendant be relieved of the obligations to take any further steps in the proceeding until the hearing and determination of the proceeding against the first defendant, or further order, save that the second defendant will be bound by any findings made in the trial against the first defendant.[15]
[15]14 December 2012 Orders, [3].

(e)It was at the plaintiffs’ insistence that Order [3] included the terms ‘… the second defendant will be bound by any findings made in the trial against the first defendant’.
(f)On 23 May 2013, pre-trial directions for hearing were made. At that directions hearing, the State submitted:
in relation to the claim in negligence, the orders also provided that the proceeding proceed as against the first defendant on the dates set down. The second defendant, the State, accepts that it will suffer issue estoppel in respect of the issues in this hearing that affect it in its case, and they will be predominantly the quantum issues, [the] same damage being sought against the State as is sought against the first defendant.

(g)On 3-7 June 2013, 11-12 June 2013, 19-21 June 2013, 21-23 October 2013 and 12-13 February 2014, the plaintiffs’ case on quantum was heard.
(h)The plaintiffs’ case at trial remained on the same pleaded bases as summarised in paragraphs [6], [7], [8] and [9(b)] above, however ultimately at trial the plaintiffs elected not to present any evidence to prove the diminution of the subject land.
(i)The State participated in that trial by way of appearance, submission and examination of witnesses and incurred costs in doing so.
(h)At trial the parties made written and oral submissions on the basis upon which the State participated in the trial as summarised at paragraphs [53] to [67] of the Judgment in the matter referred to below.
(i)On 13 July 2015, Judgment was handed down in the proceeding. The Court’s reasons for decision are summarised at paragraph [9]. In relation to paragraph [19] of the Further Amended Statement of Claim dated 18 December 2012, which is materially the same as the case in damages against the State, the Court found:
(i)the plaintiffs did not establish that at the time of the Mobil leak and thereafter they had, or but for the Mobil leak would have had, the opportunity to develop the plaintiffs’ land residentially;
(ii)the plaintiffs had not lost the opportunity to develop their land because of the Mobil leak;
(iii)the opportunity to develop the plaintiffs’ land residentially, as identified by the plaintiffs, had no real prospect of being successfully pursued and was therefore of negligible or no value;
(iv)the Mobil leak, in itself, will not prevent or impair the plaintiffs’ ability to develop their land for residential purposes; and
(v)the plaintiffs are entitled to be paid the sum of $104,273.93 and interest by Mobil in relation to the plaintiffs’ costs incurred in investigating the Mobil leak.

(j)On 19 October 2015, the Court made final orders giving effect to these findings.
(k)On 4 October 2015, the plaintiffs lodged an application for leave to appeal against the whole of the above decision with the Court of Appeal. The State participated in that application on the same basis as the plaintiffs and Mobil. On 5 August 2016, the Court of Appeal granted the plaintiffs leave to appeal and dismissed the appeal. The plaintiffs were, amongst other things, ordered to pay the State’s costs of the appeal.
(l)On 2 September 2016, the plaintiffs applied to the High Court of Australia (‘the High Court’) for special leave to appeal this decision. On 13 December 2016, the High Court dismissed the application for special leave to appeal with costs. The State participated in the special leave application on the same basis as the plaintiffs and Mobil.
(m)On 10 February 2017, the solicitors for the State contacted Mark Bradley, the partner at Ashurst, Mobil’s solicitors, with carriage of this proceeding on behalf of Mobil. The State’s solicitors asked whether Ashurst had satisfied the judgment against it at first instance (and thereby complied with paragraphs [2] and [4] of the Court’s trial orders). Mobil’s solicitors informed the State’s solicitors that Mobil had satisfied the judgment against it at first instance, in the amount of $104,273.93 and interest, and thereby complied with paragraphs [2] and [4] of the trial Judge’s orders.
(n)On 16 December 2016, the State’s solicitors sent a letter to the plaintiffs’ solicitors in this proceeding seeking to finalise the proceeding as against the State by inviting the plaintiffs to discontinue the proceeding against the State. The State’s solicitors anticipated that they would receive instructions from the State to seek summary dismissal of the proceeding and seek costs on an indemnity basis if the proceeding were not discontinued, and the State’s solicitors put the plaintiffs on notice of this.
(o)On 25 January 2017 Matthew Spain, a solicitor at King & Wood Mallesons, replied. The plaintiffs declined to discontinue the proceeding against the State.

The Plaintiffs’ Application in Late 2012 to Join the State

In relation to the plaintiffs’ November 2012 joinder application, referred to at paragraph [9(a)] above, the plaintiffs relevantly, amongst other things, submitted that:[16]
[16]Plaintiffs’ Submissions, 29 November 2012.

The proposed claims against the State
13.Key allegations against the State are that the State through the Minister and/or the Director:
(f)Breached the duty of care to the plaintiffs by failing to discharge its responsibilities and functions including verifying whether repairs to Mobil Pipeline No 1 had been undertaken properly and promptly between 20 May 1999 and 6 December 2006 (para [38]) which led to the perforation of Mobil Pipeline No 1 and which caused the plaintiffs to suffer loss and damage (para [39]).

23.The following questions relating to the State are matters which are also relevant to, and arise from the claims made by the plaintiffs against Mobil. Namely:
(k)What loss and damage has been suffered by the plaintiffs? Did the breaches of duty by the State cause or contribute to the loss and damage suffered by the plaintiffs?
(n)Determining the plaintiffs’ loss and damage and in particular whether the plaintiffs have lost the opportunity to use and develop the plaintiffs’ land for residential purposes as alleged by the plaintiffs.
The loss and damage alleged by the plaintiffs is the same as against the State and Mobil.
The extent of the plaintiffs’ claimed loss and damage is likely to be in issue for the State as it is for Mobil.

24.There are therefore considerable common questions of law and fact between the plaintiffs’ proposed claims against the State and those as against Mobil which would be required to be determined separately if separate proceedings were required to be brought against the State. The resolution of these common issues of fact and law in separate proceedings (and possibly inconsistently) would not be conducive to the just resolution of the issues.

Just and convenient to determine the proposed claims against the State in this proceeding
25.It would be just and convenient to determine the claims proposed against the State in this proceeding for the following reasons.
Joining the State would avoid a multiplicity of proceedings
26.In exercising its powers under the Rules, the Court is directed to ensuring the effective, complete, prompt and economical determination of questions in proceedings (r. 1.14). The Civil Procedure Act 2010 also directs the court to give effect to the overarching purpose in the exercise of any of its powers or in the interpretation of those powers. Relevant objectives include the just determination of the proceeding and the efficient conduct of the business of the court (ss 8 and 9(1)).
27.Refusing the plaintiffs leave to join the State to this proceeding would result in the certainty of a further proceeding being filed by the plaintiffs against the State. Such an outcome would be inconsistent with the effective, economical and efficient conduct of the business of the Court and the resolution of issues in this proceeding because:
(a)the resources of the court and the parties would be expended unnecessarily in the determination of similar if not the same issues. There is significant overlap between the claims against Mobil and the proposed claims against the State. The area of overlap encompasses both factual and legal issues. For example, in any subsequent proceeding the State is likely to adopt a similar defence to Mobil in relation to the question of the loss and damage suffered by the plaintiffs and allege that the plaintiffs’ loss and damage should not be assessed by reference to any loss of opportunity to develop the plaintiffs’ land for residential purposes.
(c)Given the extent of the overlap of the legal and factual issues and the fact that the same or similar evidence will be called in relation to the common issues there is a heightened possibility of inconsistent findings of fact and law in relation to this proceeding and any subsequent proceeding as against the State. The prospect of inconsistent findings of fact and law is highly undesirable. The integrity of the administration of justice would require that the potential for conflicting judgments be avoided by an order joining the State to this proceeding.

29.The avoidance of a multiplicity of proceedings would therefore be consistent with the effective, economical and efficient conduct of the business of the Court and the resolution of all issues in this proceeding and in any subsequent proceeding that would be required to be brought against the State.

Accordingly, as emphasised in the plaintiffs’ own submissions, in late 2012 the plaintiffs urged the Court to join the State to its proceeding. In summary, on the plaintiffs’ assertions, this was because:

(a) the loss and damage alleged by the plaintiffs was the same as against the State and Mobil;[17]
[17]Ibid [23(n)], see above.

(b) the extent of the plaintiffs’ claimed loss and damage is likely to be in issue for the State as it was for Mobil;[18]
[18]Ibid [23(n)].

(c) questions relating to the State are matters which are also referred to, and arise from the claims made by the plaintiffs against Mobil, including the question of what loss and damage has been suffered by the plaintiffs;[19]
[19]Ibid [23(k)].

(d) it would be just and convenient to have the plaintiffs’ claims against the State determined in the same proceeding in which the plaintiffs’ claims against Mobil were determined. In particular, the Act directs that the Court shall ensure the effective, complete, prompt and economical determination of questions in proceedings when exercising its powers under the rules;[20]
[20]Ibid [26].

(e) refusing the plaintiffs leave to join the State to this proceeding would result in the certainty of a further proceeding being filed by the plaintiffs against the State. Such an outcome would be inconsistent with the effective, economical and efficient conduct of the business of the Court and the resolution of issues in this proceeding. This is because, for example, in any subsequent proceeding the State would likely adopt a similar defence to Mobil in relation to the question of the loss and damage suffered by the plaintiffs, and allege that the plaintiffs’ loss and damage should not be assessed by reference to any loss of opportunity to develop the plaintiffs’ land for residential purposes;[21]
[21]Ibid [27(a)].

(f) avoiding a multiplicity of proceedings would therefore be consistent with the effective, economical and efficient conduct of the business of the Court and the resolution of all issues in this proceeding, and in any subsequent proceeding that would be required to be brought against the State;[22]

(g) if the State was not joined and there were multiple proceedings, the resources of the Court and the parties would be expended unnecessarily in the determination of similar if not the same issues. For example, in any subsequent proceeding, the State would be likely to adopt a similar defence to Mobil in relation to the question of the loss and damage suffered by the plaintiffs and allege that the plaintiffs’ loss and damage should not be assessed by reference to any loss of opportunity to develop the plaintiffs’ land for residential purposes;[23]

(h) not joining the State to the plaintiffs’ proceeding against Mobil, given the overlap of legal and factual issues, would heighten the possibility of inconsistent findings.[24]

[22]Ibid [29].

[23]Ibid [27] and [27(a)]

[24]Ibid [28(c)].

Interlocutory Orders

On 30 November 2012 the Court ordered, amongst other things, that the State be joined as second defendant to the proceeding. The 30 November 2012 Orders included the following:

1.Subject to paragraphs 2 and 3 of these orders, the plaintiff has leave to join the State of Victoria as a party to this proceeding, and to file and serve the Amended Writ and Statement of Claim.
2.The leave in paragraph 1 of these orders is granted expressly reserving the right of the State of Victoria to apply to strike out part of or all of the amended statement of claim (insofar as it relates to claims brought against it) or seek summary judgment.
3.The leave in paragraph 1 of those orders is granted expressly reserving the right of either defendant to apply for orders that:
(a)pursuant to r 9.04(d) or r 9.06(1) the State of Victoria cease to be a party, or that there be separate trials pursuant to r 9.04(a);
(b)there be a trial on the question of quantum alone; and/or
(c)the proceeding insofar as it relates to the State of Victoria be stayed pending the hearing and determination of a trial on the question of quantum.

Pursuant to the 30 November 2012 Orders, the State filed a Summons and affidavit in support, returnable on 14 December 2012, seeking among other things:

1.Pursuant to Rule 47.04, there be a separate trial on the question of the damages sought to be heard and determined prior to any trial on the question of liability as against the second defendant;
2.The proceeding on the question of liability as against the second defendant be stayed pending hearing and determination of the damages question.

On 14 December 2012 further orders were made in the proceeding, including:

1.The proceeding, insofar as it concerns the dispute between the plaintiffs and the first defendant, be fixed for hearing.
3.Save for the filing of a defence … the second defendant be relieved of the obligations to take any further steps in the proceeding until the hearing and determination of the proceeding against the first defendant, or further order, save that the second defendant will be bound by any findings made in the trial against the first defendant.[25]

[25]14 December 2012 Orders, [1], [3] (underlining added).

The underlined part of the above 14 December 2012 Orders was added by the Court at the plaintiffs’ instigation.[26]
[26]Affidavit of Philippa Jane Mitchell, 3 May 2017, Exhibit ‘PJM-18’.

In ‘Other Matters’ the 14 December 2012 Orders stated that:

It is in the interests of efficiency and the prompt resolution of the main issues in dispute for the trial to proceed, in the first instance, against the first defendant alone.

Accordingly, it is clear that in November 2012 the plaintiffs sought to have the State joined to the proceeding. The plaintiffs did so on several bases. These include the congruity of the damages claims and issues between the plaintiffs and Mobil and the plaintiffs and the State; and the need to avoid subsequent proceedings, such as where the State might adopt a similar defence to Mobil in relation to the question of loss and damage suffered by the plaintiffs, and likewise argue that the plaintiffs’ loss and damage should not be assessed on a loss of opportunity basis.

The plaintiffs now argue that damages-related findings and determinations at trial do not bind them. In effect, the plaintiffs seek to run another proceeding which provides a further opportunity to put their damages claim against the State. This is notwithstanding the plaintiffs’ submissions, referred to above, which resulted in the State being joined to the previous proceedings. Moreover, this is notwithstanding the plaintiffs’ insistence that the terms of the Court’s 14 December 2012 Orders in relation to the plaintiffs’ damages would bind the State.

The 2015 Judgment

At paragraphs [68] and [69] of the 2015 Judgment, I made the following observation in respect of the 14 December 2012 Orders:

68.What is clear is that this part of the proceeding will determine the main issues as between the plaintiffs and Mobil. That is, it will determine liability and quantum in respect of Mobil. It is also clear that this part of the proceeding will not determine whether the State is liable. What is not clear is the extent to which findings against Mobil in relation to quantum will bind the State.
69.In my view it is unnecessary to determine at this stage which findings in this part of the proceeding will bind the State in the next part of the proceeding concerning the State’s liability. The extent to which the State is bound by findings in these reasons for judgment will be determined if and when the State’s liability is decided upon.

Paragraphs [53] to [67] of the 2015 Judgment are as follows:

53.In their written closing submissions, the plaintiffs submitted that on the State’s application, the Court ordered that issues of liability and relief against the State be split and the issue of relief be heard first, concurrently with the hearing of those issues against Mobil.[27] The plaintiffs submit that for the purposes of this trial, the liability of Mobil is established and the liability of the State (for breaches of the State’s duty to the plaintiffs) is to be assumed. Accordingly, the plaintiffs submit that the only issue before the Court is what relief is appropriate against each defendant.[28]
[27]Plaintiffs’ Closing Submissions [1].
[28]Ibid.
54.The State submitted that this is the trial of the proceeding brought against the first defendant, though the State will be bound by necessary and indispensable findings of fact relevant to the proceeding against it and, in particular, as to loss and damage.[29] Put another way, the current trial involves the case on liability and quantum against Mobil, and affects the plaintiffs’ case on quantum against the State only to the extent indicated by Dixon J in Blair v Curran.[30]
[29]State’s Closing Submissions [1], [156] citing Blair v Curran (1939) 62 CLR 464 at 531-533; see also State’s Opening Submissions [4].
[30]State’s Reply Submissions [1].
55.During closing submissions, the State explained that the plaintiffs’ submission that issues of liability and relief against the State have been split and that the issue of relief is being heard first, is incorrect.[31]
[31]T1466.18-22.
56.On 14 December 2012 Daly AsJ ordered, among other things, that ‘Save for the filing of a defence … the second defendant be relieved of the obligations to take any further steps in the proceeding until the hearing and determination of the proceeding against the first defendant, or further order, save that the second defendant will be bound by any findings made in the trial against the first defendant’.[32] In the ‘Other Matters’ section of the orders it was stated that ‘It is in the interests of efficiency and the prompt resolution of the main issues in dispute for the trial to proceed, in the first instance, against the first defendant alone’.
[32]Orders of Daly AsJ, 14 December 2012 [3].
57.The State explained that the loss and damage claimed against Mobil and the State is identical. The State was joined as a party to the proceeding by an order made at the end of November 2012, and was invited to participate in this trial. The State decided to participate, and will suffer the estoppels that are outlined by Dixon J in Blair v Curran.[33] The State explained that because of the stage the proceeding was at when the State was joined as a party, and the fact that the relief sought against the two defendants was the same, it was decided that the plaintiffs should first go to trial against Mobil alone.[34] The liability and quantum issues are being run against Mobil, but not the State. The State had an opportunity to be heard on the quantum issue, and will be bound as described by Dixon J in Blair v Curran.[35] The State submitted that it entered into the debate on the appropriate measure of damages and the quantum of the plaintiffs’ loss only insofar as it was necessary to protect its interests.[36]
[33](1939) 62 CLR 464; see also T1466.23-30.
[34]T1467.21-26.
[35]T1467.27-31; T1468.1-3.
[36]State’s Closing Submissions [3].
58.In closing submissions, the State said that this was the State’s formal position on its involvement in the proceeding,[37] and that was made clear at the directions hearing on 23 May 2013 and at the start of the trial.
[37]T1496.10-11.
59.At the directions hearing on 23 May 2013, the State said that the orders of 14 December 2012 meant that the trial would proceed against Mobil. The State accepted that it would suffer issue estoppel in respect of the issues in this proceeding that affect the State in its case. Those issues would be predominantly the quantum issues, because the same damages were sought from Mobil and the State. The State said it was prepared to take part in the trial in relation to those issues and other factual issues relevant to relief.[38]
60.In its opening submissions, the State submitted that in this trial of Mobil’s liability, the State is concerned principally with the defence in relation to quantum, and in those circumstances, in any subsequent action or in the liability case against the State, there will be issue estoppel in relation to the necessary findings made in this proceeding. The State said that the issue estoppel was the reason for the State’s presence in this trial.[39]
61.In closing submissions, the State submitted that a consequence of the loss and damage claim against the defendants being identical, is that the Court’s ability to draw inferences from the State’s failure to call certain evidence is constrained.[40] Where two parties have interests which are the same in respect of the issue before the court, and where at least one of those parties has called evidence on a subject, an inference cannot arise against the other party because there is no relevant gap in the evidence from which such inference might arise.[41]
62.The plaintiffs had a different understanding of the orders of Daly AsJ made on 14 December 2012. In closing submissions the plaintiffs said that they opposed the making of the relevant order, which was made because the State said it was not ready for the trial as then scheduled. The plaintiffs emphasised the words ‘any findings’ in the order ‘that the second defendant will be bound by any findings made in the trial against the first defendant’.[42]
63.The plaintiffs said that Blair v Curran dealt with judgment estoppel.[43] There is no judgment estoppel in this case. Rather, the State is bound by any findings, not just the findings that would be encompassed by a judgment estoppel.[44] For example, if the Court finds that the plaintiffs lost the opportunity to develop the land, that finding will bind the State. The State cannot go behind any findings the Court makes in this case.[45] That is the reason for the State’s participation in the trial. The plaintiffs conceded, however, that there must be a separate trial against the State to establish its liability.[46]
64.The plaintiffs accepted that their written closing submissions[47] misstated the position,[48] but they disagreed with the State’s description of its position in this trial. They said their closing submissions should read ‘for the purposes of this trial, the liability of Mobil is established and the liability of the State (for breaches of the State’s duty to the plaintiffs) is to be determined later, with the State being bound by any findings made against Mobil in this trial’.[49]
65.In response to this, the State said its formal position on its involvement in this trial was put on the transcript as early as 23 May 2013 and then again on 4 June 2013 (day two of trial), but there was no response or comment by the plaintiffs until 13 February 2014, the last day of trial.[50]
66.The State said that the argument put to Daly AsJ before the making of the 14 December 2012 orders made reference to Blair v Curran, and the argument was accepted by her Honour.[51] The State submitted that the meaning of paragraph 3 of the 14 December 2012 orders and the extent to which the State is bound by any determination of fact made in this proceeding, may be a matter for another day.[52]
67.Finally on this matter, the State submitted that in referring to Blair v Curran, the State was not raising matters of judgment estoppel or res judicata. This part of the proceeding is not a part which will result in a judgment against the State. So, the estoppel arising from judgment in this part of the proceeding must be the second layer of issue estoppel.[53] The State submitted that if there is a need to reopen the order of Daly AsJ, that will be done if appropriate.[54]

[38]Transcript of directions hearing 23 May 2013, T19.29-31, T20.1-9.

[39]T197.9-15.

[40]T1468.17-25.

[41]T1469.3-8.

[42]T1497.15-18.

[43]T1497.L20-21.

[44]T1497.22-25.

[45]T1497.29-31.

[46]T1497.28-29.

[47]Plaintiffs’ Closing Submissions [1].

[48]T1498.1-4.

[49]T1498.5-12.

[50]T1496.8-19; T1499.8-10.

[51]T1499.12-15.

[52]T1499.16-19.

[53]T1499.19-24.

[54]T1499.25-26.

In the 2015 Judgment, the plaintiffs’ case in damages against Mobil was dismissed, save in respect of the relatively minor claim by the plaintiffs against Mobil for certain costs of investigating a hydrocarbon leak.

The 2015 Judgment was challenged unsuccessfully by the plaintiffs in the Victorian Court of Appeal. The plaintiffs failed to obtain special leave to appeal to the High Court of Australia (‘the High Court’).

In this proceeding, the plaintiffs contend that while the 14 December 2012 Orders temporarily relieved the State of its obligation to defend the plaintiffs’ case until the hearing and determination of the trial, on the condition that the State would be bound by the 2015 Judgment, those orders preserved the plaintiffs’ entitlement to prosecute their case against the State.

The State’s Submissions
General Outline of State’s Submissions

In short, the plaintiffs brought an action in negligence against the State. The case in damages against the State was pleaded in identical terms with the case in damages pleaded against Mobil. The plaintiffs’ case in damages against Mobil has been dismissed, save in respect of the plaintiffs’ cost of investigating the leak. Mobil has satisfied judgment in that connection. The plaintiffs have no further avenue of appeal in respect of judgment, applications to the Court of Appeal and High Court having been dismissed.

Given the facts deposed by Ms Mitchell, the State submits there is no further case to answer. The proceeding against it therefore has no real prospect of success.

Further or alternatively, the State submits the factual and procedural context for the proceeding gives rise to:

(a) an issue estoppel, binding on the plaintiffs, that precludes them from asserting any further or other entitlement to damages in this proceeding; or alternatively

(b) an abuse of process, in the sense described by the High Court in Port of Melbourne Authority v Anshun Pty Ltd (‘Anshun’).[55]

[55](1981) 147 CLR 589, 598-599.

The State also contends that the plaintiffs’ proposed amended claim pertains to the same question which was fully and finally determined by the 2015 Judgment. In these circumstances, the State contends it has no further case to answer and the proceedings against it should be dismissed as having no real prospect of success.[56]
[56]State’s Submissions, 21 April 2017, [5]-[9] and [13]-[15].

The State also objects to the ‘new evidence’ that the plaintiffs now seek to admit. The State submits that this ‘new evidence’ was in fact known to the plaintiffs as early as 2014, and points out that no application to amend was made until April 2017.

Accordingly, the State submits that the plaintiffs’ proposed claim should be summarily dismissed pursuant to s 63 of the Act as enjoying no real prospect of success.

The State’s Submissions – issue estoppel

Applying the principles articulated by Dixon J in Blair v Curran,[57] the State submits that the plaintiffs are estopped from asserting any further or other entitlement to damages in this proceeding. The State contends that the plaintiffs’ proposed claim involves the ‘same question’ in respect of damage that has already been decided against Mobil and seeks a ‘finding’ which has already been made as part of the 2015 Judgment.
[57](1939) 62 CLR 464 at 531-532.

The State relies on the 14 December 2012 Orders which bind the State to any findings made at trial against Mobil. It submits that an estoppel bound each of the parties to those issues pleaded against the State from the time that the 2015 Judgment was made. The State observes that it played an active part in the trial between the plaintiffs and Mobil. It submits that it is therefore subject to, and may also assert, the same estoppels as Mobil.

The State contends that the relevant Court’s ‘findings’ giving rise to its right to prevent further proceedings by the plaintiffs include the findings and determinations identified in the following paragraph from the 2015 Judgment:

I do not consider however that it is appropriate to endeavour to decide what, if any, sum the plaintiffs would be entitled to, assessed as I have found damages should be in the circumstances of this case. That is because the plaintiffs do not plead (as explained above),[58] or submit, nor have they adduced any evidence in support of, an entitlement to damages based on diminution of the value of their land. Furthermore, the evidence referred to above,[59] to which Mobil refers in its Closing Submissions concerning diminution damages, has not been put forward by any expert witness who has explained the basis for and comprehensiveness and accuracy of his or her calculation of such damages. In the result the scant evidence to which Mobil refers, does not provide a sound and safe basis for the Court to be satisfied as to the proper quantum of the plaintiffs’ damages and the plaintiffs do not seek to be compensated on a diminution of value basis. [60]
[58]The 2015 Judgment, [733]-[738].
[59]Ibid [747].
[60]Ibid [752].

The State’s Submissions – abuse of process

The State submits that the matters which the plaintiffs wish to raise in its proposed claim ‘so clearly could have been raised’ in the trial against Mobil because they form part of the subject matter dealt with in the 2015 Judgment. To permit the plaintiffs to raise these issues, notwithstanding their failure to advance the whole of the claim in 2015, would amount to an injustice and an abuse of process.

The State contends that the Court should exercise its power under s 63 of the Act to bring the plaintiffs’ residual case to an end. In addition, the State contends the Court should exercise its inherent power to control and supervise its process to prevent the injustice that would be caused by re-litigation of a claim.

The State’s Submissions – res judicata

In its oral submissions, the State argued that the 2015 Judgment gives rise to a res judicata. Specifically, a res judicata arose because it was ordered expressly on 14 December 2012 that the State be bound by the findings in the trial contained in the 2015 Judgment. The effect of res judicata means that all causes of action the subject of the trial are merged in the 2015 Judgment. In the result, the State submits that the plaintiffs are prevented from agitating any further proceeding in relation to the findings and determinations at trial against the State. Accordingly, the State submits the plaintiffs’ proposed claim is futile and that judgment should be entered in the State’s favour in the proceeding.

The State’s Submissions - prejudice

The State also submits that the relevant balance of prejudice militates against the plaintiffs at this stage being permitted to prosecute the new claims. In particular, prejudice may be caused to Mobil if the plaintiffs’ proposed claim is granted. In this regard, the State submits that because of the State’s ability to claim under the Wrongs Act 1958 (Vic), as between the State and Mobil as multiple defendants, Mobil stands to lose the benefit of the 2015 Judgment.

The State’s Submissions - leave to amend

The State submits that the plaintiffs’ proposed amendment to add a claim in nuisance against the State, and to amend their pleading, should be disallowed. This is because the plaintiffs’ proposed amendments to its Amended Statement of Claim are in relation to claims which enjoy no reasonable prospect of success; and because the plaintiffs’ proposed amendments come unacceptably late in the proceeding and fail the test from AON Risk Services Australia Limited v Australia National University (‘AON’).[61]
[61](2009) 239 CLR 175.

The State’s Submissions - ‘new evidence’

In relation to the ‘further relevant facts’ raised in the Troiani affidavit which the plaintiffs assert have arisen since the conclusion of the trial, the State maintains that the ‘new matters’ identified by the plaintiffs do not provide a basis upon which the plaintiffs have any real prospect of success. More specifically, the State submits that:

(a) the plaintiffs’ suggested ‘new evidence’ extends back to facts known as early as 2014, which with reasonable diligence such evidence could have been identified and relied on much earlier;

(b) no amendment should be permitted in these circumstances where the plaintiffs should, on the other estoppel and abuse related bases argued by the State, be precluded from advancing hopeless claims;

(c) the plaintiffs’ proposed amendments should be refused because that application would be unsuccessful by reference to the test set in AON;[62]
[62]Ibid at [34].

(d) the evidence in relation to the sale of the Arundel Stud land referred to in paragraphs [5]-[34] of the Troiani affidavit has been dealt with by the Court of Appeal[63] in an appeal from the 2015 Judgment in this proceeding and is not relevant to the question of causation which was dismissed in the trial;

(e) the nature and extent of Mobil’s remediation of the Mobil leak, raised in paragraphs [35]-[37] of the Troiani affidavit, was the subject of extensive evidence during the trial and has been addressed in the 2015 Judgment; and

(f) the assertions in respect of the pipeline licences raised in paragraph [38] of the Troiani affidavit are not relevant to the question of damage.

[63]Winky Pop Pty Ltd v Mobil Refining Australia Pty Ltd [2016] VSCA 187 [41]-[55].

The Plaintiffs’ Submissions

The plaintiffs oppose the State’s application for judgment against the plaintiffs in the proceeding. The plaintiffs contend that the principles relevant to issue estoppel and Anshun estoppel are not relevant in the proposed action against the State.

The Plaintiffs’ Submissions – issue estoppel

The plaintiffs contend:

(a) the Court found the proper basis for the measurement for damages in relation to the plaintiffs’ cause of action to be diminution in value of the plaintiffs’ land; and

(b) the sum to which the plaintiffs would be entitled to on account of a diminution in value of the plaintiffs’ land was not the subject of any of the 2015 Judgment because the plaintiffs did not plead or adduce any evidence in support of that contention.[64]

[64]The 2015 Judgment, [752]; Plaintiffs’ Submissions, 1 May 2017, [6].

Accordingly, the plaintiffs submit there is no ‘finding’ in the 2015 Judgment, of the type referred to in the 14 December 2012 Orders, preventing the plaintiffs from bringing a case against the State founded upon an asserted diminution in the value of the plaintiffs’ land.

In any event, the plaintiffs submit that any findings are not ‘legally indispensable’ to the 2015 Judgment concerning loss of opportunity damages.[65] On the plaintiffs’ submission, the Court reached the conclusion that the appropriate measure of damages applicable to the plaintiffs’ causes of action was ‘diminution in the value of’ the land. For this reason, no issue estoppel arises.[66]
[65]Plaintiffs’ Submissions, 1 May 2017, [17] and [30].
[66]Plaintiffs’ Submissions, 1 May 2017, [6] and [15].

The plaintiffs also submit that the ‘same question’ does not arise in the proposed claim against the State. The question at the 2015 trial was the value of the plaintiffs’ land at the date of trial. While at the first trial the value of the land was to be assessed by reference to how the plaintiffs would have developed their land, the plaintiffs submit that, pursuant to their proposed amended claim at the forthcoming trial against the State, the value of the land will now be assessed by reference to market price at about the date of that trial. This is because the plaintiffs wish to plead a continuing nuisance.

The plaintiffs also contend that they are not bound by evidentiary findings of fact which form part of the 2015 Judgment. In any event, the plaintiffs seek to adduce further evidence on the question of the diminution in the value of the plaintiffs’ land, the details of which are contained in the Troiani affidavit.

The Plaintiffs’ Submissions – Anshun estoppel and abuse of process

The plaintiffs submit that there is no Anshun estoppel. This is because there has been no adjudication of the plaintiffs’ claims against the State. On the plaintiffs’ submission, Anshun estoppel arises only where a given matter is adjudicated between the relevant parties by a court with competent jurisdiction. The parties to that litigation are in such circumstances required to bring forward the whole of their case.

The plaintiffs further submit that there is no prejudice to the State in permitting the plaintiffs to seek damages measured by reference to diminution in value of the plaintiffs’ land. This is because the State submitted during the trial that the plaintiffs were entitled to such a measure of damages; and because the State conceded that there had been some relevant diminution of value.

The plaintiffs also submit that they should be permitted to further pursue their claims against the State. They observe that their present unamended pleading already seeks damages against the State. The plaintiffs contend that there has been no material delay in pursuing its damages claim against the State for diminution of value of the land, because the case between those parties has in effect been suspended since mid-December 2016, and there is no trial date yet fixed for the residue of the proceedings.

The Plaintiffs’ Submissions – res judicata

Senior Counsel for the plaintiffs submitted that there was no res judicata. Senior Counsel’s submission was that in the present case, at best for the State, issue estoppel could be made out with respect to liability issues which were determined in the trial against Mobil.

Senior Counsel for the plaintiffs submitted that no res judicata has arisen because, in December 2012, the Court set down the trial against Mobil alone. For this reason, the plaintiffs contend that no cause of action against the State merged in the 2015 Judgment.

The plaintiffs also point out that the State earlier opposed its own joinder by the plaintiffs. Moreover, although joined, the State did not provide general discovery and chose to participate in the trial only to the extent of cross-examining witnesses and making submissions. The plaintiffs make these points in support of their argument that the State cannot, in the circumstances, be heard to argue that the case against it has been run and lost.

The Plaintiffs’ Application to Seek Leave to Amend its Amended Statement of Claim against the State

The plaintiffs seek leave to amend their pleading to add a claim in nuisance against the State. They submit that the proposed amendments are necessary to enable the real questions in controversy between the parties to be decided.

The plaintiffs’ application for amendment is supported by the Troiani affidavit. I note this affidavit runs to almost 1,000 pages, including its 24 exhibits, and is in substance of very similar content to the affidavit sworn by Chloe Marion Moore on 25 November 2015. The Moore affidavit of 25 November 2015 was filed by the plaintiffs in the appeal proceeding in relation to 2015 Judgment and in support of the plaintiffs’ then application for leave to rely upon the evidence before the Court of Appeal.

The plaintiffs referred to the ‘new evidence’ in the Troiani affidavit to indicate the nature of the ‘new evidence’ which they would seek to adduce at the future trial in this proceeding if the plaintiffs are permitted to proceed, and if the extant application for leave to amend were acceded to as part of the current applications.

The plaintiffs accept that, for present purposes, the Court’s receipt of the Troiani affidavit is for the limited purpose of understanding the parties’ arguments of the current applications.[67]
[67]T78.12-24.

The nature of the plaintiffs’ further evidence referred to in the Troiani affidavit is summarised below at [60], [157] and [158] of these Reasons.

The plaintiffs concede that the ‘new evidence’ referred to in the Troiani affidavit is the same evidence which they sought to admit before the Court of Appeal in 2016.[68] The Court of Appeal rejected the plaintiffs’ application to rely on the said ‘new evidence’ in 2016.
[68]T80.3-4.

Even so, the plaintiffs rely on De Jager v Payneham and Margill Lodges Hall Incorporated[69] and Commonwealth v Verwayen,[70] and submit there are no disentitling factors militating against this Court granting leave.
[69](1984) 36 SASR 498.
[70](1990) 170 CLR 394.

The plaintiffs submit further that the proposed amendment will not prejudice the State. It is directed to the State’s liability which can only now be pursued; and there is no prejudice to Mobil because the nuisance claim in the proposed amendment is directed only against the State.

The plaintiffs also assert that its proposed case for trial will not give rise to any risk of inconsistent findings because the assessment of diminution in value of the plaintiffs’ land will take place at the date of any future trial in respect of the plaintiffs’ continuing nuisance claim.

The Troiani affidavit sets out what the plaintiffs contend are further, and new, facts relevant to the plaintiffs’ claims against the State which the plaintiffs say have arisen since the trial (the new evidence). In substance, those facts relate to Amendment C96 to the Hobsons Bay Planning Scheme and Planning Permit Application PA1328001 in respect of the Arundel Stud land.

The Plaintiffs’ Submissions – prejudice

The plaintiffs made no express submission in relation to prejudice. However, if the State’s application were to succeed, it is manifest the plaintiffs would be prejudiced by being deprived of their opportunity to advance the merits of the case they now seek to prosecute.

Mobil’s Submissions

Mobil did not make any submissions in response to the current applications made by the plaintiffs and the State.

Mobil is not a party to the plaintiffs’ amendment application.

Counsel for Mobil stated orally that Mobil wished to assert its right to rely on any judgment arising from a trial between the plaintiffs and the State, in particular ‘to defeat any further monetary plans’ (sic).[71]
[71]T38.20-21.

Counsel for Mobil also sought to confirm that any issues forming part of the trial between the plaintiffs and the State concern both Mobil and the State.[72]
[72]T38.22-25.

Considerations
Relevant legal principles

The State seeks judgment pursuant to s 63 of the Act on the basis that the plaintiffs’ amended claim has no real prospect of success for three reasons: the plaintiffs’ claim will be defeated by the State’s plea of res judicata; is subject to issue and Anshun estoppels; and if prosecuted would constitute an abuse of process.

Res judicata

Res judicata has been described by Fullagar J as follows:

[W]here an action has been brought and judgment has been entered in that action, no other proceedings can thereafter be maintained on the same cause of action. [73]

[73]Jackson v Goldsmith (1950) 81 CLR 446 at 466.

In Fidelitas Shipping Co Ltd v V/O Exportchleb,[74] Lord Denning MR held:

If one party brings an action against another for a particular cause and judgment is given upon it, there is a strict rule of law that he cannot bring another action against the same party for the same cause.[75]

[74][1966] 1 QB 630.

[75]Ibid at 640.

Where a competent tribunal has adjudicated the merits of a cause of action, the cause of action cannot be agitated in subsequent proceedings. Res judicata applies where final judgment has been rendered in the exercise of judicial power resulting in the merger of a right or obligation asserted in the subject proceeding in the judgment.[76]
[76]Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 57, [22].

The High Court has drawn a distinction between res judicata and cause of action estoppel. However, as it recognised in Tomlinson v Ramsey Food Processing, cause of action estoppel ‘is largely redundant where the final judgment was rendered in the exercise of judicial power, and where res judicata in the strict sense therefore applies to result in the merger of the right or obligation in the judgment’.[77]
[77]Ibid.

Issue Estoppel

In Blair v Curran,[78] Dixon J, as his Honour then was, referred to the requirements necessary to establish issue estoppel in the following terms:

A judicial determination directly involving an issue of fact or of law disposes once for all of the issue, so that it cannot afterwards be raised between the same parties or their privies. The estoppel covers only those matters which the prior judgment, decree or order necessarily established as the legal foundation or justification of its conclusion, whether that conclusion is that a money sum be recovered or that the doing of an act be commanded or be restrained or that rights be declared. [79]

[78](1939) 62 CLR 464.

[79]Ibid at 531.

The relevant issue or action before the Court must have been necessarily decided by a prior action for the estoppel to arise. This requires the Court to identify whether the issues in respect of which the estoppel is asserted pertain to the same question for determination in the subsequent proceeding. In Ramsay v Pigram,[80] Barwick CJ held:

Long standing authorities, in my opinion, warrant the statement that, as a mechanism in the process of accumulating material for the determination of issues in a proceeding between parties, an estoppel is available to prevent the assertion in those proceedings of a matter of fact or of law in a sense contrary to that in which that precise matter has already been necessarily and directly decided by a competent tribunal in resolving rights or obligations between the same parties in the same respective interests or capacities, or between a privy of each, or between one of them and a privy of the other in each instance in the same interest or capacity. The issue thus determined, as distinct from the cause of action in relation to which it arose, must have been identical in each case.[81]

[80](1968) 118 CLR 271.

[81]Ibid at 276.

As to the issue of legal indispensability necessary to establish issue estoppel, Dixon J made the following additional observations in Blair v Curran:[82]

Nothing but what is legally indispensable to the conclusion is thus finally closed or precluded. In matters of fact the issue estoppel is confined to those ultimate facts which form the ingredients in the cause of action, that is, the title to the right established. Where the conclusion is against the existence of a right or claim which in point of law depends upon a number of ingredients or ultimate facts the absence of any one of which would be enough to defeat the claim, the estoppel covers only the actual ground upon which the existence of the right was negatived. But in neither case is the estoppel confined to the final legal conclusion expressed in the judgment, decree or order. In the phraseology of Coleridge J in R v Inhabitants of the Township of Hartington Middle Quarter, the judicial determination concludes, not merely as to the point actually decided, but as to a matter which it was necessary to decide and which was actually decided as the groundwork of the decision itself, though not then directly the point at issue. Matters cardinal to the latter claim or contention cannot be raised if to raise them is necessarily to assert that the former decision was erroneous.
In the phraseology of Lord Shaw, “a fact fundamental to the decision arrived at” in the former proceedings and “the legal quality of the fact” must be taken as finally and conclusively established (Hoystead v. Commissioner of Taxation). But matters of law or fact which are subsidiary or collateral are not covered by the estoppel. Findings, however deliberate and formal, which concern only evidentiary facts and not ultimate facts forming the very title to rights give rise to no preclusion. Decisions upon matters of law which amount to no more than steps in a process of reasoning tending to establish or support the proposition upon which the rights depend do not estop the parties if the same matters of law arise in subsequent litigation.[83]

[82](1939) 62 CLR 464.

[83]Ibid at 532.

In Linsley v Petrie,[84] Hayne JA observed that:

It is therefore of the first importance to identify with care the issue of fact or law which is said now to be the subject of an issue estoppel.[85]

[84][1998] 1 VR 427.

[85]Ibid at 429.

In considering whether an issue estoppel applies, the reasons for judgment are likely to be particularly important.[86]
[86]Jackson v Goldsmith (1950) 81 CLR 446, 467.

I note that in the 2015 Judgment, I made the following observations regarding issue estoppel:

59At the directions hearing on 23 May 2013, the State said that the orders of 14 December 2012 meant that the trial would proceed against Mobil. The State accepted that it would suffer issue estoppel in respect of the issues in this proceeding that affect the State in its case. Those issues would be predominantly the quantum issues, because the same damages were sought from Mobil and the State. The State said it was prepared to take part in the trial in relation to those issues and other factual issues relevant to relief.
60In its opening submissions, the State submitted that in this trial of Mobil’s liability, the State is concerned principally with the defence in relation to quantum, and in those circumstances, in any subsequent action or in the liability case against the State, there will be issue estoppel in relation to the necessary findings made in this proceeding. The State said that the issue estoppel was the reason for the State’s presence in this trial.

…
67Finally on this matter, the State submitted that in referring to Blair v Curran, the State was not raising matters of judgment estoppel or res judicata. This part of the proceeding is not a part which will result in a judgment against the State. So, the estoppel arising from judgment in this part of the proceeding must be the second layer of issue estoppel. The State submitted that if there is a need to reopen the order of Daly AsJ, that will be done if appropriate.

Anshun Estoppel

An Anshun estoppel may arise where a cause of action, defence or matter relied upon in a subsequent action was so relevant to the subject matter of the first action that it was unreasonable of a party not to rely on such claim, defence or matter in the first action.[87]
[87]Anshun (1981) 147 CLR 589 at 602-604.

The principle was stated broadly by Wigram VC in Henderson v Henderson:[88]

… where a given matter becomes the subject of litigation in, and of adjudication by, a court of competent jurisdiction, the court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points upon which the Court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time.[89]

[88]Henderson v Henderson (1843) 3 Hare 100; [1843-60] All ER Rep 378; (1843) 67 ER 313.

[89]Henderson v Henderson (1843) 3 Hare 100 at 114-15; [1843-60] All ER Rep 378 at 381-2; (1843) 67 ER 313.

The Vice-Chancellor’s above statement is however subject to three important points.

(a) The extended principle identified by Wigram VC is different to ‘a plea of res judicata’ in the strict sense. Res judicata prevents the re-litigation of a cause of action that has already been adjudicated. By contrast, the ‘extended principle’ articulated by Wigram VC, which has now been accepted by Australian Courts, refers to matters that should have been raised by the parties in an earlier proceeding. It is also broader than issue estoppel, which operates in respect of findings that are the ‘legal foundation or justification’ for the conclusion reached in a prior judgment.[90]
[90]Blair v Curran (1939) 62 CLR 464 at 532.

(b) Notwithstanding their functional differences, the same policy considerations underpin the ‘extended principle’ identified by Wigram VC, res judicata, cause of action estoppel and issue estoppel. As recognised by Lord Bingham in Johnson v Gore Wood & Co:[91]
[91][2002] 2 AC 31; [2001] 1 All ER 498.

The underlying public interest is the same: that there should be finality in litigation and that a party should not be twice vexed in the same matter. This public interest is reinforced by the current emphasis on efficiency and economy in the conduct of litigation, in the interests of the parties and the public as whole. The bringing of a claim or the raising of a defence in later proceedings may, without more, amount to abuse if the court is satisfied (the onus being on the party alleging abuse) that the clam or defence should have been raised in the earlier proceedings if it was to be raised at all.[92]

(c) In Australia, the extended principle is now subject to an ‘unreasonableness’ qualification. An estoppel will only arise where the matter relied upon in the second proceeding was so relevant to the subject matter of the first proceeding that it was unreasonable to have not raised it earlier.[93]

[92]Ibid 498-9.

[93]Anshun (1981) 147 CLR 589 at 602.

In Anshun, Gibbs CJ, Mason and Aickin JJ held:

…there will be no estoppel unless it appears that the matter relied upon as a defence in the second action was so relevant to the subject matter of the first action that it would have been unreasonable not to rely on it. Generally speaking, it would be unreasonable not to plead a defence if, having regard to the nature of the plaintiff's claim, and its subject matter it would be expected that the defendant would raise the defence and thereby enable the relevant issues to be determined in the one proceeding.[94]

[94]Ibid.

In Gibbs v Kinna, Ormiston JA held:

The issue is whether it was unreasonable to defer reliance upon the defence or cause of action, so, if it cannot be shown to have been unreasonable not to have relied earlier on the defence or cause of action, then the principle stated by the majority in Anshun's Case will not shut out a party's later reliance on the defence or cause of action, unless some other principle of estoppel or the law can be called in aid. Only if deferring reliance can be shown to be unreasonable, will the party be shut out. Frequently there is no clear answer as to what was possible and reasonable in the earlier proceedings; sometimes it will have been technically possible for the party to have relied on a particular defence or set up a particular claim, but nevertheless it may not have been demonstrated that it was unreasonable in all the circumstances not to have relied on that defence or not to have set up the claim. The answer depends not so much on legalities as practicalities.[95]

[95]Gibbs v Kinna [1999] 2 VR 19 at 20.

Accordingly, in considering whether an Anshun estoppel arises, the question is whether it was unreasonable for the relevant party in the earlier proceeding to pursue a course of action, usually in the context of litigation, not relying on a cause of action, defence, claim or issue.[96] Only if that party’s conduct in deferring reliance on a cause of action, defence, claim or issue was unreasonable, in all the relevant circumstances, will the party be estopped. In such a situation the appropriate order is usually one staying the proceeding.
[96]Ibid.

The relevant abuse which founds the estoppel is not confined to the re-opening of a matter already decided between the same parties. An abuse can also arise where a party agitates a claim or issue so connected with the subject matter of the earlier proceeding that it is unreasonable, in the context of the earlier proceeding that such claim or issue was not raised. Furthermore, such circumstances may also support a preclusive abuse of process which justifies the Court staying the further pursuit of such a claim or issue or entering judgment in favour of the party able to rely on such a preclusive abuse of process.[97] It may be an abuse of the Court’s process to allow a new proceeding to be commenced, or a part heard proceeding to continue, in respect of such a claim or issue.
[97]Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 57, [22].

In Anshun, Gibbs CJ, Mason and Aickin JJ noted that there are various reasons for choosing not to litigate an issue in an earlier proceeding.[98] This suggests such estoppels are to be applied with caution. Caution is also required because if applied, the estoppel, or other relief to the same effect, will deprive a party of the opportunity to pursue a claim, defence or issue without any determination of its merits.
[98]Anshun (1981) 147 CLR 589 at 602.

Abuse of Process

The Court has power under s 63 of the Act, and inherent power, to control and supervise its process to prevent injustice.

63 Summary judgment if no real prospect of success
(1)Subject to section 64, a court may give summary judgment in any civil proceeding if satisfied that a claim, a defence or a counterclaim or part of the claim, defence or counterclaim, as the case requires, has no real prospect of success.
(2)A court may give summary judgment in any civil proceeding under subsection (1)—
(a)on the application of a plaintiff in a civil proceeding;
(b)on the application of a defendant in a civil proceeding;
(c)on the court's own motion, if satisfied that it is desirable to summarily dispose of the civil proceeding

In Jeffery & Katauskas v SST Consulting,[99] French CJ, Gummow, Hayne and Crennan JJ held:

The term ‘abuse of process’, as used in Australia today, is not limited by the categories mentioned above or those which constitute the tort. It has been said repeatedly in the judgments of this Court that the categories of abuse of process are not closed. In Walton v Gardiner the majority adopted the observation in Hunter v Chief Constable of the West Midlands Police that courts have an inherent power to prevent misuse of their procedures in a way which, although not inconsistent with the literal application of procedural rules of court, would nevertheless be ‘manifestly unfair to a party to litigation … or would otherwise bring the administration of justice into disrepute among right-thinking people’. This does not mean that abuse of process is a term at large or without meaning. Nor does it mean that any conduct of a party or non-party in relation to judicial proceedings is an abuse of process if it can be characterised as in some sense unfair to a party. It is clear, however, that abuse of process extends to proceedings that are ‘seriously and unfairly burdensome, prejudicial or damaging’ or ‘productive of serious and unjustified trouble and harassment’.[100]

[99](2009) 239 CLR 75.

[100]Ibid at 93-94 (citations omitted).

Abuse of process may arise where a party is bound in substance by an earlier determination, or otherwise precluded from taking or advancing claims or issues. Indeed, the High Court has recognised that circumstances supporting ‘Anshun estoppel’ may also give rise to a preclusive abuse of process.[101] Abuse of process is applicable in any circumstances where the use of a court’s procedures would be unjustifiably oppressive to a party; or would bring the administration of justice into disrepute.[102] This is notwithstanding that the technical requirements of an estoppel may be absent.[103]
[101]Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 57, [22].
[102]Ibid [25].
[103]See, e.g., Walton v Gardiner (1993) 177 CLR 378 at 393.

Proceedings will constitute an abuse of process if the proceeding, or part of it, has no real prospect of success. Such a proceeding, or part of it, may be stayed as an abuse of process if issue estopped or the subject of Anshun estoppel.[104] Such a proceeding, or part of it, may also be the subject of summary judgment pursuant to s 63 of the Act.
[104]Walton v Gardiner (1993) 177 CLR 378 at 393.

Application to Amend

The principles governing the subject application to amend are to be considered in light of the amendments set out at paragraphs [41] to [50] of the plaintiffs’ proposed Second Further Amended Statement of Claim, dated 28 April 2017.

In summary, the plaintiffs’ proposed amendments are:

(a) to add a claim in nuisance against the State;

(b) to put a case for damages based on diminution of value of the land;

(c) amendment designed to indicate the nature of the ‘new evidence’ which the plaintiffs intend to adduce in any future trial; and

(d) amend the plaintiffs’ claim to include references to Pipeline Licence No 38.

The power to amend in Rule 36 of the Supreme Court (General Civil Procedure) Rules 2005 (‘the Rules’) gives the Court a wide discretion to allow amendments to any document in a proceeding to determine the real controversy between the parties, to correct any defect or error, or to avoid a multiplicity of pleadings. Rule 36.01 of the Rules relevantly provides:

(1) For the purpose of—
(a)determining the real question in controversy between the parties to any proceeding; or
(b)correcting any defect or error in any proceeding; or
(c)avoiding multiplicity of proceedings —

the Court may, at any stage order that any document in the proceeding be amended or that any party have leave to amend any document in the proceeding.
…
(3) An indorsement of claim or pleading may be amended under paragraph (1) notwithstanding that the effect is to add or substitute a cause of action arising after the commencement of the proceeding.

Further, Rule 1.14 of the Rules provides:

In exercising any power under these Rules the Court -
(a)shall endeavour to ensure that all questions in the proceeding are effectively, completely, promptly and economically determined;

In the exercise of any discretion, the Act is also likely to be of relevance. In particular, s 7 of the Act states that the overarching purpose of the Act and Rules in civil proceedings is to ‘facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute’.

There are a number of factors the Court ought to consider in exercising its discretion to allow an amendment. In Commonwealth v Verwayen,[105] Dawson J held:

In granting leave to amend, a court is concerned with the raising of issues and not with their merits. Of course, an amendment which is futile because it is obviously bad in law will not be allowed.[106]

[105](1990) 170 CLR 394.

[106]Ibid 456.

In AON,[107] the High Court identified factors to be considered in the exercise of the Court’s discretion to grant or decline leave to amend a pleading. These included:[108]
[107](2009) 239 CLR 175.
[108]See summary of factors identified in AON set out in Namberry Craft Pty Ltd v Watson [2011] VSC 136 at [38].

(a) whether there will be substantial delay caused by the amendment;

(b) the extent of wasted costs that will be incurred;

(c) whether there is an irreparable element of unfair prejudice caused by the amendment arising, for example, by inconvenience and stress caused to individuals or inordinate pressure placed upon corporations, which cannot adequately be compensated for, whatever costs may be awarded;

(d) concerns of case management arising from the stage in the proceeding when the amendment is sought, including the fact that the time of the court is a publicly funded resource, and whether the grant of the amendment will result in inefficiencies arising from the vacation or adjournment of trials;

(e) whether the grant of the amendment will lessen public confidence in the judicial system; and

(f) whether a satisfactory explanation has been given for seeking the amendment at the stage when it is sought.

The Court is not ordinarily concerned to examine the merits of the case in any depth when considering an application for leave to amend. However, the absence of a real prospect of success at trial would be a highly relevant factor in the Court’s exercise of its discretion.[109]

The State’s Summary Dismissal Application – s 63 of the Act and Pursuant to the Court’s Inherent Jurisdiction

[109]Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd (2013) 42 VR 27.

The State submits that it is entitled to judgment pursuant to s 63 of the Act, or alternatively in the Court’s inherent jurisdiction, on the basis that the plaintiffs’ proposed claim is defeated by the State’s plea of res judicata; the plaintiffs proposed claim is estopped; and the plaintiffs’ proposed claim is an abuse of process. The State contends that on each of these bases the plaintiffs’ proposed claim should be summarily determined[110] because, for the reasons stated, the plaintiffs’ claim has no real prospect of success.
[110]Plaintiffs’ Main Issues Summary (undated, provided 4 April 2017), [2].

Issue Estoppel

For the State to succeed in its submission based on issue estoppel, it is necessary and important to identify if, and the extent to which, the 2015 Judgment directly involved and determined an issue which the plaintiffs now again seek to agitate.

The 2015 Judgment

This requires scrutiny of the 2015 Judgment including the ‘summary of findings’ at paragraph [753]:

For the above reasons I find that:
1.The proper basis for the measurement of damages in relation to the plaintiffs’ causes of action is diminution in the value of the plaintiffs’ land.
2.In this matter the assessment of damages on a loss of opportunity basis would be unacceptably uncertain and is more likely to lead to an unjust result than diminution of value damages and is also otherwise inappropriate.
3.Prior to the Mobil leak it was most unlikely that the plaintiffs’ land would be rezoned by the relevant planning authority so as to be able to be developed for residential use.
4.Prior to the Mobil leak it was most unlikely that the relevant planning authority would grant development permits for the plaintiffs to develop their land for residential purposes.
5.At the time of the Mobil leak and thereafter the plaintiffs have not established that they had, or but for the Mobil Leak would have had, the opportunity to develop the plaintiffs’ land residentially.

In addition to the paragraphs set out above, I sought to explain the position of the plaintiffs, as pleaded and on the evidence and cases presented at trial, at [733]-[752] of the 2015 Judgment:

733.The plaintiffs would be more appropriately entitled to damages for diminution in value of the land. So much was conceded by both Mobil and the State.[111] However, the plaintiffs have not pleaded or submitted nor adduced evidence to support their entitlements to damages for diminution of their land. The plaintiffs’ initial reference in their pleadings to a diminution in value claim was ultimately clarified by particularisation, to be a claim for the loss of profits caused by their loss of opportunity to develop the plaintiffs’ land residentially. Further, the plaintiffs did not adduce any evidence as to the pre-leak or post-leak value of the land. The plaintiffs did however rely on evidence given by Mr Brown, a Mobil expert witness, to identify the residual value of the land. The plaintiffs in their case have deducted from their value of the lost opportunity the Brown Report residual value of the plaintiffs’ land at $9.9m.[112]
[111]Mobil’s Closing Submissions, [56]-[60]; State’s Closing Submissions, [147].
[112]Plaintiffs’ Closing Submissions [17].
734.The plaintiffs submit that valuing the plaintiffs’ loss by reference to the market value of the land alone and ignoring the plaintiffs’ opportunity to develop the land for profit would significantly under-compensate the plaintiffs for the wrong that they have suffered from the conduct of the defendants.[113]
[113]Plaintiffs’ Opening Submissions [21].
735.By their Further Amended Statement of Claim dated 18 December 2012, the plaintiffs seek damages in negligence. Those damages have been particularised under four heads:
(i)Costs of investigating the contamination of the plaintiffs’ land.
(ii)Costs of remediating the plaintiffs’ land.
(iii)The diminution in the value of the plaintiffs’ land.
(iv)Loss of profits that the plaintiffs would have realised from the development of the plaintiffs’ land but for the contamination.[114]
[114]Further Amended Statement of Claim, [19].

736.Heads of damages (ii)-(iv) have not been pleaded in the alternative, although to award the plaintiffs damages under each of those three heads would probably result in the plaintiffs being overcompensated. Further particulars of these damages were to be provided prior to trial.
737.The plaintiffs’ Response to Request for Further and Better Particulars dated 19 October 2011 provided that the diminution in the value of the plaintiffs’ land is equal to the loss of profits particularised in the plaintiffs’ Statement of Claim.[115] In summary, loss of profits, as pleaded and submitted by the plaintiffs, is to be calculated as the gross revenue of the residential development, minus the costs associated with the residential development, minus residual value of the land.[116]

I consider that in substance the plaintiffs are seeking to again raise the issues foreclosed in the 2015 Judgment flowing from the contamination of their land.

For the reasons I have outlined, the plaintiffs are issue estopped from pursuing their claim for damages for diminution of the land as a result of contamination against the State, including on the proposed amended basis of a continuing nuisance perpetrated by the State.

Anshun estoppel

In the context of this application, and in particular the plaintiffs’ response to the State’s Summons of 16 March 2017, for the reasons outlined above, the plaintiffs have in my view acted unreasonably in these proceedings to date by not put putting forward the whole of their damages case at trial. They should not be permitted to do so now.

As stated, an Anshun estoppel may arise where a cause of action, defence, claim or issue relied upon in a subsequent action was so relevant to the subject matter of the first action that it was unreasonable of a party not to rely on such cause of action, defence, claim or issue in the first action.[140]
[140]Anshun (1981) 147 CLR 589 at 602-604.

In my view, the plaintiffs acted unreasonably in deferring the claim for damages they now seek to prosecute against the State in this proceeding.

The facts referred to above establish that the parties, and the Court, sought to have the whole of the plaintiffs’ damages case dealt with and adjudicated at trial.

The plaintiffs also sought to effectuate orders to ensure any findings against Mobil were binding on the State to achieve that purpose.

The damages findings in the 2015 Judgment and Orders comprehensively determined the plaintiffs’ claims for damages. Those findings and determinations rejected the plaintiffs’ case in relation to the species of damages which, at their election, the plaintiffs ultimately sought to recover at trial. In that regard, those findings and determinations also rejected the plaintiffs’ damages case in relation to causation.

At trial, the plaintiffs could have presented a case which sought to prove its entitlement to damages for nuisance against the State for diminution of value of the land which had been contaminated. Such a claim was an obvious component of the arguable damages case available to a litigant in the plaintiffs’ position in these proceedings, before and at the time of trial. Indeed, the plaintiffs themselves particularised a claim for ‘diminution in value of the plaintiffs’ land’, but at trial elected not to advance evidence in support of that claim.

The plaintiffs were at all relevant times mindful of the need, on a number of bases asserted by the plaintiffs themselves, to address their case in a way which would avoid an inefficient, costly and potentially inconsistent determination of their claims. This is clear from the plaintiffs’ own submission, referred to above in support of their application to join the State in November 2012.

In my view, it is very likely that Mobil would, were I to permit these proceeding to go further as the plaintiffs propose, be brought into the proceedings in the near future pursuant to a contribution claim notified by the State.

By the 14 December 2012 Orders, the State was bound unequivocally by all findings made at trial in relation to damages. The State bore the potential burden of such findings and the plaintiffs obtained the potential benefit of such findings. In particular, the State accepted it would be subject to issue estoppel in respect of any finding made in relation to Mobil at the trial pursuant to the principles elucidated by the High Court in Blair v Curran. [141]
[141](1939) 62 CLR 464; State’s Submissions, 21 April 2017, [11].

There is little doubt that if the plaintiffs had been successful as to damages at trial, the plaintiffs would be relying on the 2015 Judgment and Orders against the State.

However the plaintiffs’ damages case at trial failed and the plaintiffs now seek to run another damages case against the State in relation to the same land and the same contamination.

Whereas the plaintiffs sought to amend the Orders of 14 December 2012 to ensure the benefit of any damages findings against the State, in effect the plaintiffs now seek to avoid the burden of those Orders. I consider this to be impermissible in the circumstances.

Conclusion – Anshun – estoppel – (abuse)

It was incumbent upon the plaintiffs to bring all available claims against both Mobil and the State after the latter party was joined. A party to litigation is obliged to bring forward the whole of its case. If it does not do so, it may be precluded from raising a cause of action, defence, claim or issue for determination in a later proceeding which might have been brought forward in an earlier proceeding against the same party.

The plaintiffs’ proposed conduct in this proceeding, including the application to amend, would provide an opportunity to further pursue a damages case against the State. The plaintiffs are estopped on the bases elucidated in Anshun.[142] If permitted to proceed, the plaintiffs’ proposed case against the State’s claim would be tantamount to permitting the plaintiffs to advance a case against the State which the plaintiffs unreasonably failed to advance at trial. It would also be a clear abuse of process if the proposed conduct were permitted in the circumstances of this proceeding to date.[143]
[142](1981) 147 CLR 589 at 602-604.
[143]Anshun (1981) 147 CLR 589 at 604.

Abuse of process – conclusion

On the same bases I have outlined for my conclusions the plaintiffs are both issue estopped and Anshun estopped from seeking to prosecute their proposed damages claim against the State in the circumstances of this proceeding. I am also persuaded that the plaintiffs should be prevented from perpetrating an abuse of process by advancing this proceeding and their proposed damages claim as they propose to do.

Accordingly, the plaintiffs’ proposed conduct here constitutes a preclusive abuse of process.

Conclusion – summary dismissal application – State’s application for judgment

Claims will not be struck out or dismissed on summary application pursuant to s 63 of the Act unless so untenable that they do not have any real prospect of success.[144]
[144]Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd (2013) 42 VR 27 at [35].

Section 63 of the Act is of application including where a claim has no real prospect of success on the basis of the application of res judicata, issue estoppel, Anshun estoppel or preclusive abuse of process. [145]
[145]Ibid; Dey v Victorian Railways Commissioners (1948) 78 CLR 62 at 91; [1949] ALR 333.

Further, if a claim has no real prospect of success there would usually be no warrant for the Court to exercise its discretion and allow the matter to proceed to trial pursuant to s 64 of the Act.

In this proceeding the State seeks judgment pursuant to s 63 of the Act and based on it being entitled in the circumstances to rely upon res judicata, issue estoppel, Anshun estoppel and preclusive abuse of process. I consider that the State has here established issue estoppel, Anshun estoppel and the risk of preclusive abuse of process. Ultimately, for these reasons I do not consider that the plaintiffs enjoy any real prospect of success in respect of the proceeding they propose to continue.

The plaintiff’s application to amend pleadings
Factors militating against amendment being permitted

The plaintiffs are precluded now from amending to run a new case of the type referred to against the State because:

(a) the plaintiffs are issue and Anshun estopped from proceeding further with their proposed new claims, including being granted leave to amend and rely upon what is said to be new evidence in that regard;

(b) it would be an abuse of process if the plaintiffs are permitted to in substance resurrect a damages claim in nuisance against the State, having lost that claim in respect of the same land, same nuisance, and same damages against Mobil.

(c) in my view it is no answer to this abuse for the plaintiffs to argue that, were they to pursue their nuisance claim against the State, their claimed damages would be different. The foreshadowed differences in the proposed nuisance-based damages claim, compared to the claim earlier run by the plaintiffs at trial, do not in my view overcome the unreasonableness, in the circumstances outlined above, of the plaintiffs’ conduct in failing to bring forward nuisance damages claim based diminution of value against the State in the first trial. I am satisfied that case could, and should, have been pleaded against the State at the first trial, if such a claim was to be raised by the plaintiffs;

(d) the plaintiffs themselves relied on the need for the efficient, timely and cost-efficient resolution of the real issues in dispute, and the need to avoid duplication of proceedings, in support of their application to join the State in late 2012;

(e) the State was, and is, neither the owner nor the occupier of the relevant land, and it is therefore improbable that the plaintiffs have a claim in nuisance against the State in any event;

(f) the plaintiffs’ proposed ‘new evidence’, which was rejected by the Victorian Court of Appeal as detailed below, does not demonstrate, even in a prima facie way, that the plaintiffs enjoy any real prospect of success in relation to their proposed amended claim in nuisance against the State, because that evidence continues to fall short of addressing the probative shortcomings highlighted by the Court of Appeal, and because it also appears that the likely availability of the new evidence sought to be relied upon was apparent to the plaintiffs by May 2015[146] and before the 2015 Judgment was handed down. The plaintiffs made no application to adduce further evidence;

(g) finally, in my view, were the plaintiff to be permitted to pursue its damages case against the State, as presently framed, the plaintiffs’ proposed amended pleadings would pose the same fundamental damages and causation issues and questions for decision as have already been decided in the 2015 Judgment. Those earlier findings were final in nature and have been the subject of an unsuccessful appeal and an unsuccessful special leave application to the High Court.

[146]See Reasons Court of Appeal; Troiani Affidavit, [26]-[28].

At trial, the plaintiffs’ claim for loss and damage was the same damages claim on the same bases against both Mobil and the State. If the plaintiffs desired to raise available different or additional claims, whether against Mobil or the State, it was obligated to do so in the 2015 proceeding.

For the reasons above, I accept the State’s submission that issue estoppel and an Anshun estoppel are available in respect of the plaintiffs’ continuance of these proceedings and proposed claim against the State. I am also satisfied that it would be an abuse of process for the plaintiffs to be permitted to advance these proceedings and pursue their proposed claims. In this regard, in the circumstances I have highlighted above, were the plaintiffs not precluded from advancing their claims I consider that it would be unjustifiably oppressive to the State, and would offend the requirements of ss 7 and 8 of the Act, including by generating unnecessary further costs, delay and wasting the Court’s resources.

For these further reasons the plaintiffs now enjoy no real prospect of success in relation to the damages claim they seek to advance in these proceedings against the State. The plaintiffs should not be permitted to further advance any part of its damages claim.[147]
[147]Affidavit of Philippa Mitchell, 16 March 2017, Exhibit PJM-4, [9].

The New Evidence

If permitted to take this proceeding further, and if granted leave to amend, the plaintiffs foreshadow their reliance on ‘new evidence’ in relation to Amendment C96 Planning Scheme and Planning Application PA1328001. This amendment rezoned the land at 222-238 Kororoit Creek Road and 240-258 Kororoit Creek Road from Industrial 3 Zone to the General Residential Zone.[148]
[148]Troiani Affidavit, [5] and [6].

The plaintiffs’ proposed new evidence includes evidence of events in May and early July of 2015. I consider that this evidence could have been raised with the Court in relation to the judgment, which was reserved at that time, to enable consideration of whether judgment should await a formal application by the plaintiffs to re-open their case and adduce evidence then available, or imminently to become available, in relation to Amendment C96 – Hobsons Bay Planning Scheme Planning Permit PA1328001.[149]
[149]Affidavit of Chloe Marion Moore, 25 November 2015, [26]-[28]; see also Court of Appeal’s observations [2016] VSCA 187 at [54].

The plaintiffs have put on no evidence to explain why they did not prosecute, or attempt to prove, a conventional damages claim based on diminution of the value of their land. I do not consider that the ‘new evidence,’ so characterised, provides such an explanation. Nor am I persuaded, as earlier touched upon, that such evidence could not, with reasonable diligence have been raised and presented before the 2015 Judgment was handed down. At no stage did the plaintiffs seek to apply to re-open their case and adduce further evidence.

Earlier application in 2016 to introduce further evidence before the Court of Appeal

In relation to the substance of the plaintiffs’ proposed new evidence and amended pleading, I also note that the Court of Appeal was urged previously to permit the same ‘new evidence’ to be introduced and to be formally addressed in the Appeal which the plaintiffs brought in relation to the 2015 Judgment.[150] The Court of Appeal refused the plaintiffs/appellants’ leave to introduce the further evidence.
[150]At T80.2-7 the plaintiffs concede that the ‘new evidence’ the subject of the plaintiffs’ application to the Victorian Court of Appeal on 23 May 2016 is the same evidence as is put forward in this application in the Troiani affidavit; see also plaintiffs’ written submissions on Appeal, 25 November 2015, [3].

The Court of Appeal’s reasoning for rejection of the plaintiffs’ application to amend aspects of its appeal and rely on new evidence is as follows:[151]
[151][2016] VSCA 187, [50]-[55]; (underlining added).

50We concluded that the application to adduce further evidence should be refused for a number of reasons.
…
52Secondly, it is the fact that both the applicants’ land and the land the subject of amendment C96 and the related planning application were zoned industrial, and were within the ILMS of June 2008. Further, each parcel was located within the so-called Strategic Redevelopment Area (‘SRA’) Precinct 13, in respect of which it was stated — though with qualifications — that ‘a residential outcome for the majority of the precinct could be considered, provided appropriate justification for a residential outcome can be provided to the Council’. But to extrapolate from those circumstances a conclusion that the applicants’ land and the land the subject of amendment C96 were comparable was no more than bare assertion. Ms Moore’s affidavit did not suggest that the applicants proposed to call evidence to demonstrate the comparability of the land in the context of a rezoning application; and we think that such evidence would have been needed, or at least was very desirable. Absent such evidence, it appears to us that there is much which suggests that the two areas of land were not relevantly comparable. Thus:
(1)Amendment C96 was, as the panel noted, site specific.
(2)The majority of the land comprised within amendment C96 had in fact been used for residential purposes (by the Hobsons Bay Caravan Park) for nearly 40 years. The panel described the amendment proposal as essentially ‘infill development’.
(3)The panel observed that development of the site would not result in residential use any closer to the industrial facilities to the west than adjoining existing residential development. That would not be the case with much of the applicants’ land, as can be seen from the aerial photograph depicted at [12] above.
(4)Access to the C96 amendment land is quite different to the access available to the applicants’ land. There are frontages to Kororoit Creek Road and Hygeia Avenue, the latter of which was required to be constructed to a suitable standard. Further, provision was to be made for an access road within the rezoned area.
(5)The EPA did not oppose residential development of the C96 amendment land by reason of the requirement for a buffer between the refinery and land for residential use. The EPA had not indicated it would not oppose residential development of the applicants’ land.
(6)There was also evidence, which the C96 amendment panel accepted, that a ‘directional buffer’ was in point; and that the effect of a directional buffer placed the C96 land outside the recommended EPA buffer. Contrast the judge’s conclusions respecting evidence given by Mr Pollock, an expert called by the applicants, about a directional buffer in the present case.[7]
(7)The modelling presented by Mr Pollock to the C96 panel in support of the rezoning differed from that presented at trial in the present case. It showed odour plumes from two stacks at the refinery directly affecting the applicants’ land. In turn, the C96 panel observed:
The Panel does observe the model buffer, as shown in figure 7 above, does appear to cover a significant portion of the balance of Precinct 13 from the elevated stacks, and this may have implications for council’s future plans for the balance of the SRA.[8]
(8)The judge accepted the evidence of Mr Milner, a town planner who gave evidence on behalf of Mobil, that there was no opportunity to obtain a rezoning of the applicants’ land prior to the leak. That opinion did not assume that the C96 land would not be rezoned residentially. Rather, Mr Milner expressly acknowledged in cross-examination that there were good prospects of obtaining such a rezoning. It follows that the C96 rezoning is entirely consistent with the town planning evidence which the judge accepted.

53Thirdly, approaching the matter on the footing that the applicants only sought to rely upon the fact of approval of the C96 amendment in November 2015, the Court would be dealing with evidence coming into existence after trial. We were not at all persuaded that the proposed evidence would meet the test explained by Chernov JA in Foody v Horewood:
...ordinarily, the discretion to receive evidence of events after trial is exercised only rarely, and generally only if it bears upon matters falling within the field or area of uncertainty, in respect of which the trial court has made an estimate or an assumption that was then common to both parties and then that assumption has clearly been falsified by subsequent events, such that the refusal to admit the further evidence would affront common sense.

The matters set out at [52] above show why that is so.
54 Fourthly, assuming that the applicants’ true intended reliance, as Ms Moore’s affidavit would suggest, was upon the content of the sequence of events culminating in the Minister’s approval of the amendment — very largely involving circumstances in existence before the trial concluded with publication of reasons and entry of judgment — we again were far from persuaded that a basis for its receipt had been established. The applicants’ contention that, were the fresh evidence (whatever its precise content) to be received, there was a high degree of probability that the result of the proceeding below would have been different, could not be accepted. The applicants’ claim failed at a number of levels. It failed because the judge rejected loss of valuable opportunity for rezoning and residential development as the proper basis for assessment of damages. It failed because the judge concluded that there was no such valuable opportunity. And it failed because the judge concluded that, even if there had been a valuable opportunity, it had not been lost by reason of Mobil’s breach of duty. The most that the proposed further evidence could do was address the existence of a valuable opportunity. Applicants’ counsel was unable to point to any authority to the effect that evidence which would address only a part of an unsuccessful party’s case was enough to justify its reception.

55Fifthly, we agree with the submission for Mobil that, were the fresh evidence, whatever its precise content, to be received, it would necessitate a retrial. It would not be realistic to imagine that this Court could receive a body of evidence — perhaps partly oral — and then attempt to assess probabilities or possibilities by reference to that evidence and by reference to conflicting oral and documentary evidence adduced at trial. This emphasises, in our view, the significance of the failure by the applicants to draw the judge’s attention to the documents relating to the evolving C96 amendment and the associated planning application before his Honour entered judgment. It also points up the failure by the applicants’ side to give any explanation for either being unaware of the progress of the C96 amendment and planning application during 2014 and 2015 (if that was the case); or alternatively, to give any explanation for not drawing the matter to the judge’s attention before entry of judgment.

The nature and extent of Mobil’s remediation of the subject leak of hydrocarbon and the zoning and likely future utilization of the land, alluded to in the Troiani affidavit, were addressed extensively at trial and specifically determined as part of the 2015 Judgment.[152]
[152]The 2015 Judgment, [47], [303], [548], [570]-[576].

Finally, I agree with the State’s submissions that the evidence sought to be introduced by the plaintiffs is unlikely to be relevant in any event to the question of causation in this proceeding. Nor, in my view, is the proposed ‘new evidence’ likely to be material to the issues on the plaintiffs’ case as sought to be amended by the plaintiffs in this application. This is because, as stated in the Court of Appeal’s Reasons set out at [52] and [52(1)-(5), (7) and (8)] which are extracted above, the plaintiffs’ suggested ‘new evidence’ does not appear likely to establish that the plaintiffs’ land, and the land the subject of amendment C96, are relevantly compatible.

Conclusion – Plaintiffs’ Application to Amend

Given my conclusion above that the State is entitled to summary judgment, the plaintiffs’ application to amend must be refused.

Res judicata – s 63 of the Act

Given my above conclusions, I do not consider it necessary to determine the State’s argument that it is also entitled to rely upon a plea of res judicata.

Decision

Accordingly, I consider that the State’s application by summons dated 16 March 2017 should be granted and judgment entered for the second defendant, pursuant to s 63 of the Act, because the plaintiffs have no real prospect of success against the State in this proceeding for the reasons I have outlined above.

Orders

I propose to order that:

Pursuant to the second defendant’s Summons dated 16 March 2017 there be judgment for the second defendant against the plaintiffs in this proceeding pursuant to s 63 of the Civil Procedure Act 2010 (Vic).

The State seeks an order that the plaintiffs pay the second defendant’s costs of the proceeding, including any reserved costs, such costs to be taxed on party/party basis until 31 March 2013, and on a standard basis from April 2013 to 24 January 2017, and thereafter on an indemnity basis.

During argument on the subject applications the State indicated that it was not in a position to argue costs at that point.[153]
[153]T36.22-T37.10; Plaintiffs’ similar position.

In the circumstances, I shall await any further submissions from the parties before making final orders including orders as to costs.

[2018] VSC 82

28 February 2018