Beautrans P/L & Ors v CSR Ltd [2002] QSC 147

State Reporting Bureau ^ocaj * Queensland Government Department of justice and Attorney-General Transcript of Proceedings Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Director, State Reporting Bureau. REVISED COPIES ISSUED State Reporting Bureau Date 13 /<T/ OoU SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION MUIR J No S10902 of 2001 BEAUTRANS PTY LTD ACN 077 554 851 AND OTHERS and CSR LIMITED ACN 000 001 276 BRISBANE ..DATE 07/05/2002 JUDGMENT Plaintiffs Defendant WARNING: The publication of information or details likely to lead to the identification of persons in some proceedings is a criminal offence. This is so particularly in relation to the identification of children who are involved in criminal proceedings or proceedings for their protection under the Child Protection Act 1999, and complainants in criminal sexual offences, but is not limited to those categories. You may wish to seek legal advice before giving others access to the details of any person named in these proceedings. 4 th Floor, The Law Courts, George Street, Brisbane, Q. 4000 1 Telephone: (07) 3247 4360 Fax: (07) 3247 5532 -- 1 of 6 -- 1 HIS HONOUR: The plaintiffs in this , action make an application for directions that there be a trial of some separate or preliminary issues. Essentially, they are that questions of construction of the relevant contracts and also a question of rectification be determined prior to the determination of the other issues raised on the pleadings. The defendant has sought an order for security for costs. The circumstances surrounding the action were summarised by me in reasons I gave on an earlier application on 11 January 2002 and I do not propose to repeat what I there said. Mr Doyle SC, who appears for the defendant, resists the application for the trial of separate issues on a number of grounds. One was that there would be little utility in the determination of the matters proposed for early determination by the plaintiffs having regard to the fact that the plaintiffs sought other - or even perhaps identical - relief in reliance on alleged breaches of the Trade Practices Act. That was a matter which, initially, caused me concern but Mr O'Shea, who appears for the defendants, has informed me that if there is to be a trial of preliminary issues, the plaintiffs will abandon the Trade Practices Act claim and I will proceed on that basis. Other arguments Mr Doyle advanced were that (a) a separate trial would not lead to a resolution of the proceedings as a 07052002 T17/AT18 M/T 2/2002 (Muir J) 10 20 30 40 50 60 2 JUDGMENT -- 2 of 6 -- whole; (b) it was part of the defendant's case that even if breaches of contract could be made out, the plaintiffs would not be able to show loss and damage; and (c) the plaintiffs' inability to show loss and damage would be a matter which would be relevant to the question of whether they should get any equitable relief at the conclusion of the trial. He submitted that regardless of how the preliminary issues were determined there would still need to be an extensive trial which would go into matters such as the defendant 's business practices, the justification for them and the impact of those practices on the financial positions of the plaintiff . He submitted that all that would be achieved by the orders sought was a "fragmentation" of proceedings and the likelihood of additional expense and delay arising out of appeals from the preliminary determination. There is considerable force in those submissions. Experience .tells one that the splitting of trials seldom leads to a very satisfactory result. However, these questions, in the end result, are ones for judgment based on a weighing of the likely advantages and disadvantages. Of concern to me are the dimensions and estimated cost of a trial which ventilates all issues raised on the pleadings. 07052002 T17/AT18 M/T 2/2002 (Muir J) 3 JUDGMENT -- 3 of 6 -- 1 07052002 T18/CAL8 M/T 2/2002&3/2002 (Muir J) It seems to me that there is something here to be gained from an expeditious hearing of preliminary issues, a determination of which may well bring these proceedings to an end. That is if the determination is unfavourable to the plaintiffs. If it is not, then I think that there is still much to be gained; the parties will have a much clearer focus on the issues to be determined and the facts to be proved; the length of the second hearing can be substantially reduced and the prospects of a negotiated settlement considerably enhanced. For those reasons I propose to make an order along the lines sought. As for security for costs, if there were to be a hearing of all issues I would have difficulty in seeing how the plaintiffs could resist an order for security for costs. Their material, though reasonably extensive, does little to actually show the existence of assets which would provide any degree of protection to the defendant, were it to be successful in the action. The plaintiffs' best position is that there happens to be 42 of them, that they all have contracts with the defendant, that those contracts have some value and that there would, I think, be not a great deal of likelihood that the defendants would permit enforcement proceedings to take place with the windings up of their respective companies and the loss of contractual rights, in circumstances in which the defendant's claims against the plaintiffs for costs was relatively small. 10 20 30 40 50 60 4 JUDGMENT -- 4 of 6 -- 07052002 T18/CAL8 M/T 2/2002&3/2002 (Muir J) The costs to date are assessed on behalf of the defendant at $68,118 and the further assessment of a trial of preliminary issues is to the order of $105,000. The total then is estimated at $170, 000-odd, in rough terms. In those circumstances, for the reasons I have advanced, it does not appear to me that the plaintiffs will not be able' to meet any costs order made against them in respect of the preliminary hearing, which I am about to order. I take into account in that assessment that some of the costs incurred thus far are apportionable, not merely to any preliminary hearing, of course, but to the general cost of the litigation. Accordingly, on those grounds, and also having regard to my previous findings that the plaintiffs ’ case is not an unarguable one, I exercise my discretion against making an order for security for costs at this stage. I propose, however, not to dismiss the application but to adjourn it so that it can be re-enlivened if circumstances change. It.is possible that circumstances may change even before the preliminary hearing but, of course, they will necessarily change after the preliminary hearing, particularly if the defendant is then successfully. Accordingly, I adjourn the application for security for costs to a date to be fixed.I I can either reserve the costs of that or order that the costs of the application be costs in the cause. 5 JUDGMENT -- 5 of 6 -- 07052002 T18/CAL8 M/T 2/2002&3/2002 (Muir J) 1 HIS HONOUR: I order that the costs of and incidental to the application be the parties’ costs in the cause. I order that the costs of and incidental to application for directions be the parties' costs in the cause. HIS HONOUR: I order that there be a separate trial of the issues of construction of the contract or contracts described in the statement of claim and alternatively rectification of such contract or contracts which are identified in: (a) paragraphs 10 and 1 0A of the amended statement of claim; and (b) paragraphs 4(b), 5(d), 7, 8, 9, 10, 12, 20, 24, 26 and 27(b)(i) of the defence: and (c) paragraphs 2, 3, 4 and 5 of the reply. HIS HONOUR: I give leave for the plaintiffs to amend the claim in accordance with annexure A to the written submissions made today. I further give leave to the plaintiffs to amend the statement of claim in order to delete the allegations based on a breach of the Trade Practices Act 1974. 40 50 60 6 JUDGMENT -- 6 of 6 --