Procedure: summary dismissal, judgment, res judicata, issue estoppel & Anshun estoppel

LPD Holdings (Aust) Pty Ltd v Russells [2017] QSC 45

Flanagan J

The respondent/applicant (Russells) sought, inter alia, dismissal of the applicant/respondent’s (LPD) proceedings pursuant to r 658 of the Uniform Civil Procedure Rules 1999 (Qld) (the “UCPR”) or the inherent jurisdiction of the Court.

The Russells sought summary judgement pursuant to r 293 of the UCPR, however, Flanagan J found that it did not apply because the defence had not been filed.

Therefore, his Honour went on to consider the alternative basis. Rule 658 of the UCPR relevantly provides:

(1) The court may, at any stage of a proceeding, on the application of a party, make any order, including a judgment, that the nature of the case requires.

(2) The court may make the order even if there is no claim for relief extending to the order in the originating process, statement of claim, counterclaim or similar document.

The respondent/applicant submitted that the proceedings should be summarily dismissed or alternatively, permanently stayed because:

[6] (a) the costs payable by LPD to Russells are res judicata, or subject to issue estoppel, having been finally determined in previous proceedings by a judgment of the District Court; and

(b) further or in the alternative, it was unreasonable (in an Anshun sense) for LPD not to have pursued any right to an assessment of costs in those earlier proceedings and neither the Legal Profession Act nor the UCPR, entitles LPD to now seek such an assessment.

District Court Decision

In May 2014 the Russells commenced proceedings in the District Court for the payment of $172,947.31 together with interest, pursuant to s 58 of the Civil Proceedings Act 2011 (Qld). In June 2014 the registrar gave judgment in default of pleadings in the amount of $184,059.35.

In July 2014 the LPD filed an application to set aside the default judgement. Refusing the application to set aside the default judgment, Botting DCJ found that there was no triable issue because the parties’ rights had been created by an agreement entered into in September 2013.

Court of Appeal Decision

The Court of Appeal refused the application for leave to amend the notice of appeal and dismissed the appeal with costs. At the Court of Appeal, the President McMurdo stated:

[25] This Court has the power to make a declaration of the kind sought by LPD in its proposed amended notice of appeal. But an appeal court is not a court at first instance and would be reluctant to grant a declaration unless to do so was clearly in the interests of justice. The declaration was not sought at first instance. The appeal itself has become pointless and is misconceived. I am unpersuaded this is an appropriate case for this Court to grant a declaration of the kind sought. LPD has brought an application in the Trial Division of the Supreme Court for a costs assessment of Russells’ bills. If LPD wishes to apply for a declaration concerning the September 2013 agreement, the sensible course would be for it to do so in the Trial Division, with the application perhaps returnable at the hearing of LPD’s application for the costs assessment.

In the application, the applicant sought a declaration that the September 2013 Agreement did not compromise the applicant’s rights to an assessment of costs it paid to the respondent or, in the alternative, if the September 2013 Agreement did compromise the applicant’s rights to an assessment, to the extent that it purports to compromise those rights, a declaration that the agreement is void was sought.

Dismissing Russells’ application, Flanagan J held:

[32] By the present application Russells seek summary dismissal of LPD’s proceedings either pursuant to rule 658 or within the inherent jurisdiction of the Court. In such circumstances, as observed by Barwick CJ in General Steel Industries Inc v Commissioner for Railways (NSW) there is a need for exceptional caution in exercising the power whether it be inherent or under statutory rules …

[37] … There can be no res judicata unless the cause of action in the earlier proceedings is the same as the cause of action now being advanced. Issue estoppel, on the other hand, prevents a “state of law or fact” which has been determined in previous proceedings from being re-agitated in later proceedings.

[49] Russells’ submission that the present proceedings should be summarily dismissed because of res judicata and issue estoppel is not merely limited to the amount of the District Court judgment debt and the tax invoices that are referrable to the amounts relevant to calculating the judgment debt. What is sought is the summary dismissal of the whole of LPD’s proceedings which seek an order for an assessment of costs which goes well beyond the amount of the judgment debt. In terms of res judicata I do not accept that the present proceedings and the District Court proceedings concern the same cause of action. A cause of action is “every fact which it would be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgment of the Court” or may be described as “the fact or combination of facts which gives rise to a right to sue”. There is not, in my view, a sufficient identity between the underlying facts supporting the debt in the District Court proceedings with what is sought in the present proceedings

As to whether the respondent could rely on Anshun estoppel, Flanagan J stated:

[58] … Anshun creates a test of unreasonableness, and requires proof that it was unreasonable not to have brought forward the claim in the earlier proceedings. A determination of the question of unreasonableness may involve a broad merits-based judgment which takes account of the “public and private interest involved and also takes account of all the facts of the case”. In my view, it is not appropriate to summarily dismiss the present proceedings in circumstances where questions of unreasonableness of LPD’s conduct are required to be determined

The Russells was dismissed, with his Honour to hear parties as to costs.

David Cormack – Brisbane Barrister & Mediator

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