Australian Commercial Research & Development Ltd v Commonwealth of Australia [1994] QCA 420 [1995] 2 Qd R 336

THE COURT OF APPEAL [1994] QCA 420 SUPREME COURT OF QUEENSLAND Appeal No. 53 of 1994 Brisbane [Australian Commercial Research & Development v. Commonwealth] Before Macrossan CJ McPherson JA Mackenzie J BETWEEN: AUSTRALIAN COMMERCIAL RESEARCH AND DEVELOPMENT LIMITED Respondent AND: COMMONWEALTH OF AUSTRALIA Appellant REASONS FOR JUDGMENT - THE CHIEF JUSTICE Judgment delivered 14/10/1994 I agree with the conclusions stated by McPherson J.A. and Mackenzie J. and with their reasons. I wish to add some reasons of my own. The fundamental material fact in a case like the present is that the corporation against which the allegation is made had a certain condition of mind. This can only be the result, ultimately, of a mental state harboured by human agents, that is, held by persons authorised or ostensibly -- 1 of 13 -- 2 authorised on behalf of the corporation. If the corporation's mental state is an issue which is not admitted the one who alleges it will have to prove it by what is a form of circumstantial evidence, e.g. by proving, amongst other matters, that individuals A, B, or C etc. were of that state of mind. But yet it is said that if a material allegation that a natural person had a certain mental state and that is a relevant issue which is not admitted, it is sufficient because of Order 22 rule 22 simply to allege it as a fact without specifying the particular circumstances relied on to prove it. Hence the beguiling effect of the analogy relied on here - there should be no need to specify the circumstantial evidence, namely the identity of the human agents who were of the relevant point of view. This analogy should not be pushed too far. I agree with McPherson J.A. and Mackenzie J. that there is a relevant distinction between the more general question of the existence of an intention and the particular matter of the identity of the minds in which the intention resides. Order 22, rule 22 should be regarded as applying to the first matter but should not necessarily be regarded as a bar to compelling delivery of particulars in the second case. To take different circumstances and hence to look to a different analogy. If it is alleged that a contract was entered into between two parties, it is regarded as -- 2 of 13 -- 3 necessary to particularise not only the date and occasion but also the identity of the human agents through whom the parties acted to reach agreement. This information is considered to be within the standard category where sufficient particulars of the case which is relied on are required to be specified. Where, as here, it is alleged that a common intention was held between parties it is, in essential respects, asking for no more than this standard of particularity if the plaintiff is required to specify the agencies through which the dealings relevant to the proof of the common intention took place. The consideration just stated may serve to assist in explaining why it can be comfortably concluded that there is a limit, relevant in the present case, to be put on the ambit of Order 22, rule 22. This means that the reluctant decisions of single judges in N.R.N.Q. v. M.E.O. Nickel Pty Ltd (1991) 2 Qd.R 592, and Equus Financial Services Limited v. Glengallen Investments Pty. Ltd. unreported, No. 1688 of 1991 delivered 18/12/92 should be regarded as overruled on this point. The same consideration which has been referred to probably explains why the plaintiff in the present case thought it necessary to specify with particularity the dealings between persons which were relevant to the formation of the common intention on which it relied. I agree that the result is that notwithstanding the limits of the operation of Order 22, Rule 22, this very particularity -- 3 of 13 -- 4 in pleading should have the result that no further particulars ought to be ordered in the present case. The appeal should be dismissed with costs. -- 4 of 13 -- 5 IN THE COURT OF APPEAL SUPREME COURT OF QUEENSLAND Appeal No. 53 of 1994 Brisbane Before Macrossan C.J. McPherson J.A. Mackenzie J. [Aust. Commercial Research & Dev. Ltd. v. Commonwealth of Aust.] BETWEEN AUSTRALIAN COMMERCIAL RESEARCH AND DEVELOPMENT LIMITED (Plaintiff) Respondent AND COMMONWEALTH OF AUSTRALIA (Defendant) Appellant REASONS FOR JUDGMENT - McPHERSON J.A. and MACKENZIE J. Judgment delivered the 14th day of October 1994 This appeal raises a point of pleading which has attracted the attention of judges of the Court on several occasions in the past. The plaintiff in its statement of claim in the action claims it made an agreement with the defendant on about 16 July 1987. The express terms of the agreement were embodied in a deed entitled the Principal Projects Deed. Paragraph 6 of the statement of claim alleges that at the time the deed was executed, the plaintiff and the defendant "shared a common intention" that the deed would confer on the plaintiff a right of first refusal in respect of various projects and other transactions that are said to be the subject of the deed, -- 5 of 13 -- 6 and that the right in question would operate in a manner which is specified. The statement of claim goes on to allege various other matters and concludes with a prayer for relief which includes a claim for a declaration that the right of first refusal is conferred by the deed; or, alternatively, that the deed should be rectified to incorporate it. The defendant applied for particulars of para. 6. The appeal is brought against the decision refusing that application. The particulars sought and refused were as follows: "Insofar as para. 6 alleges that the plaintiff and the defendant shared a common intention at the time of execution by the parties of the Principal Projects Deed, give the name or names of the natural persons who held such intention of behalf of: (a) the plaintiff; and (b) the defendant." Because para. 6 of the statement of claim alleges a shared common intention, it was said that O.22, r.22 of The Rules of the Supreme Court prevented the making of an order for the particulars that were sought here. The provisions of O.22, r.22 are as follows: "22. When it is material to allege malice, fraudulent intention, knowledge or other condition of the mind of any person, it is sufficient to allege the same as a fact without setting out the circumstances from which it is to be inferred." In Burgess v. Beethoven Electric Equipment Limited [1943] K.B. 96, the Court of Appeal refused to order particulars to be furnished of any of the specific facts, documents or acts of the plaintiff on which the defendant sought to rely in -- 6 of 13 -- 7 support of an allegation by it that the agreement sued on by the plaintiff was intended to be carried out by bribing government officials. In delivering the judgment of the Court, Lord Greene M.R. said ([1943] K.B. 96, 100) that r.22 of the corresponding English Order XIX (as it then was) laid it down that "a pleading which alleges a condition of the mind as a fact is a sufficient pleading, and, therefore, is one in respect of which particulars cannot be ordered". The Court held that the alleged intention of a contracting party was a "condition of the mind" within the meaning of r.22. No point is made of that on this appeal. The decision in Burgess v. Beethoven was followed in Queensland in Webster v. Peninsula Estates Pty Ltd. [1969] Q.W.N. 29, where Lucas J. held it applied as much to an intention alleged on the part of a corporation as of an individual, because, as his Honour said, "it is quite possible for a company to have a corporate intention". There is no reason to doubt the correctness of the decision in either of those cases in relation to the particular question considered there. They are, however, not determinative of the problem here, which is whether, accepting that particulars of an allegation of corporate intention cannot be insisted upon, it is nevertheless legitimate to require particulars of the names of the individual or individuals who held the relevant intention on behalf of a corporation. In N.R.N.Q. v. M.E.Q. Nickel Pty. Ltd. [1991] 2 Qd.R. 592, Byrne J. reluctantly held it was not permissible to order such particulars because of the -- 7 of 13 -- 8 terms of O.22, r.22 and the interpretation he considered had been placed upon it in the two cases mentioned. His Honour's decision was, in the interests of uniformity although with equal reluctance, followed first by Williams J. in Equus Financial Services Limited v. Glengallen Investments Pty Ltd. (1688 of 1991; unrep. Dec. 18, 1992), and then again by Thomas J. in the case from which this appeal is brought. With all respect to the decision in N.R.N.Q. v. M.E.Q. Nickel Pty Ltd., we do not consider that O.22, r.22 precluded an order for particulars of the kind sought either in that case or in this. It may be accepted that, as a general rule, a corporation can have a state of mind or intention only through the medium of an individual who, either generally or for the purpose of discharging a particular function, represents the corporation itself. See H.L. Boulton (Engineering) Ltd. v. T.J. Graham & Sons Ltd. [1957] 1 Q.B. 159, 172. Particulars sufficient to identify the individual or individuals possessing the state of mind or intention that is alleged to inhere in a corporation may in an appropriate case be relevant to an allegation of corporate intention, or to an issue arising from it. In a case like that, O.22, r.22 does not prevent such particulars from being ordered. It operates only on the allegation of intention or state of mind as such, and does not exclude the power to order particulars that are needed to identify the person or individual by whom the alleged intention or state of mind was held or entertained on behalf of someone else. -- 8 of 13 -- 9 Whether there was a particular intention, and if so who held it, are distinct matters of fact. The first is governed by O.22, r.22; the second is not. Order 22, r.22 was, therefore, not an insuperable obstacle to ordering the particulars sought in the present case. However, on behalf of the plaintiff, Mr Mullins of counsel argued that the power to order particulars is discretionary, and that in this case the judge had rightly declined to order the particulars in question because they were not needed. He supported his submission by reference to the allegations in para. 7 of the statement of claim. It contains details of the dates on which and the places at which named individuals associated with the plaintiff and the defendant expressed, both orally and in writing, the common intention alleged in para. 6 of the statement of claim. It follows from what is pleaded in para. 7 that the defendant is able to identify the individuals by whom the alleged intention was held on behalf of the corporate plaintiff on one side and of the corporate defendant on the other. Paragraph 7 thus contains the particulars, so far as known to the plaintiff, that were sought by the defendant in its request. It was nevertheless submitted by Mr Dutney Q.C. for the defendant that para. 7 is not adequate because it fails to specify the particular individual on either side who is alleged to be the repository of the corporate common intention alleged in para. 6; it simply enumerates the occasions and individuals who are alleged to have taken part -- 9 of 13 -- 10 in various segments of the pre-contractual negotiations, without specifically fixing on one or some of them in particular as possessing the relevant intention on behalf of the plaintiff or the defendant. There may be in circumstances in which an endless recitation of dates, places and names would tend to be more confusing and vexatious than helpful to a litigant who is in need of such particulars. This is not such a case. On one view of the remedy of rectification, it is critical to the right to relief that there be an outward manifestation of the alleged common intention : see Joscelyne v. Nissan [1970] 2 Q.B. 86. On that footing, the allegations in para. 7 are material facts on which the plaintiff relies to prove its claim which it is bound to plead in deference to the requirements of O.22, r.1. The complaint that those allegations do not, from among the several individuals who are mentioned in para. 7, specifically pick out those who are alleged to constitute the human alter ego of the corporate plaintiff or the corporate defendant Commonwealth is not, in circumstances disclosed here, something that will place the defendant at the disadvantage of not knowing what case it has to meet at the trial. That question is largely, if not entirely, one of law which will fall to be determined once the plaintiff succeeds, if it does, in proving the facts it has pleaded in paras. 6 and 7. There is therefore no basis for interfering with the discretion of the Judge below in refusing to order the particulars sought. The appeal should be dismissed with -- 10 of 13 -- 11 costs. -- 11 of 13 -- IN THE COURT OF APPEAL SUPREME COURT OF QUEENSLAND Appeal No. 53 of 1994 Brisbane [Aust. Commercial Research & Dev. Ltd. v. Commonwealth of Aust.] BETWEEN AUSTRALIAN COMMERCIAL RESEARCH AND DEVELOPMENT LIMITED (Plaintiff) Respondent AND COMMONWEALTH OF AUSTRALIA (Defendant) Appellant Macrossan C.J. McPherson J.A. Mackenzie J. Judgment delivered 14/10/94 Joint reasons for judgment by McPherson J.A. and Mackenzie J. Separate concurring reasons by the Chief Justice. APPEAL DISMISSED WITH COSTS. CATCHWORDS PRACTICE - PARTICULARS - Statement of Claim - Statement of Claim alleged a "shared common intention" - Particulars of persons who held the common intention sought - Whether O.22, r.22 R.S.C. allowed particulars of individuals who held the relevant intention on behalf of a corporation - Whether on the facts the Court should exercise its discretion to decline to order particulars. Counsel: P.R. Dutney Q.C., with him R.Magurie, for the appellant D.G. Mullins for the respondent -- 12 of 13 -- 2 Solicitors: Australian Government Solicitor for the appellant Bill Rapp & Partners for the respondent Hearing Date: 9 September 1994 -- 13 of 13 --