"-n JUDGMENT No. watt Sk CATCHWORDS Evidence - admissibility - public document - returns of directors lodged with Commissioner for Corporate Affairs Req. v. Halpin £19753 Q.B. 907 followed Evidence - admissibility - statement in pleading in other proceedings inadmissible as an admission by party on whose behalf pleading delivered or filed Boileau v. Rutlin (1848) 2 Ex. 665; 154 E.R. 657 and Buckmaster v. Meiklejohn (1853) 8 Ex. 634; 155 E.R. 1056 followed Singleton v. John Fairfax & Sons Ltd. £19821 2 N.S.W.L.R. 38 not followed. Federal Court - jurisdiction - "accrued" jurisdiction Practice and Procedure - pleadings - amendment - Rule in Weldon v. Neal Practice and Procedure - Federal Court - third parties - directions as to participation in trial Federal Court Rules Order 5 Rule 12(2) STOHL AVIATION V. ELECTRUM FINANCE PTY. LTD.; ELECTRUM FINANCE PTY. LTD. V. TARAK MANAGEMENT SERVICES PTY. LTD. AND ORS. No. G38 of 1982 CORAM: Mr. Justice Jenkinson PLACE: Adelaide DATE: 16 October, 1984 IN THE FEDERAL COURT OF AUSTRALIA SOUTH AUSTRALIAN DISTRICT REGISTRY GENERAL DIVISION BETWEEN : AND: ) ) NO. G38 OF 1982 ) STOHL AVIATION Applicants ELECTRUM FINANCE Pry. AND: LTD. Respondent /Cross-Claimant TARAK MANAGEMENT SERVICES Pry. ETD. First Cross Respondent CORPORATE CONSULTANTS AND: INTERNATIONAL LIMITED Pry. Second Cross Respondent EDWARD CHRISTIAAN SENT CORAM: Mr. Justice Jenkinson PLACE: Adelaide DATE: 16 October, 1984 Third Cross Respondent JON DEAN WILSON Fourth Cross Respondent TREVOR BURTON HUTTLEY Fifth Cross Respondent DONALD BROWNLIE FLEMING Sixth Cross Respondent REASONS FOR JUDGMENT The hearing together of originating process and of the the applicants' claims on the respondent's cross-claims against 2. the cross-respondents, other than Corporate Consultants International Pty. Ltd., is proceeding before me. I have been informed that Corporate Consultants International Pty. Ltd. 15 in course of being wound up. Each of the other cross-respondents, of whom only three have appeared at trial, filed a defence which put in issue between respondent and cross~respondent some of the allegations which the applicants must prove in order to establish their claims against the respondent, as well as allegations peculiar to the respondent's cross-claim against him. No exercise had occurred before trial of any of the powers conferred on the court by paragraphs (b), (c), (d) and (f) of Order 5 Rule 12(2) of the Rules. While the trials have proceeded thus far leave has been given, without objection by any party, to those three cross-respondents to appear at the trial of the claims on the originating process and to cross-examine witnesses for the applicants and to tender documents in evidence in the course of cross-examination. And I have heard submissions by 'all parties appearing at the trials as to what further or other directions with respect to the cross-respondents ought to be given under Order 5 Rule 12. Further, in the defence of each cross-respondent, other than Corporate Consultants International Pty. Ltd., the jurisdiction of this court to entertain the claims by the respondent against that cross-respondent was denied. The cross-respondent Jon Dean Wilson, who appears in person, advanced no submission in support of that point of law, but Mr. Gillard Q.C., who appeared with Mr. Magarey for the cross-respondent Edward Christiaan Sent, has made submissions in supprt of his a 3. client's denial of jurisdiction; and Mr. Riggall of counsel for the cross-respondent Donald Brownlie Fleming adopted Mr. Gillard''s submissions. At the conclusion of argument on 9 August 1984 I overruled the contention of lack of jurisdiction. I now state my reasons for doing 50. Mr. Gillard having apprehended that the submissions he desired to make concerning lack of jurisdiction might involve a matter arising under the " Constitution or involving its interpretation, he first satisfied me by a statement from the Bar table which he has undertaken to verify by evidence that notice of this cause, specifying the nature of the matter arising under the Constitution or involving its interpretation had been given to the Attorneys-General of the Commonwealth and of the States, and that a reasonable time had elapsed since the giving of the notice for consideration by the Attorneys-General of the question of intervention in the proceedings or removal of the cause to the High Court. The applicants are the eighteen members of a partnership formed in June 1981 to take on lease from the respondent an aircraft of which the applicants proposed to grant charters for reward. They allege that the formation of the partnership and their entry into the lease were induced by misrepresentations made by persons for whose conduct the respondent is, as the applicants allege, legally responsible. The misrepresentations are alleged to have been made fraudulently and also to have constituted contraventions of sections 52, 53(a), 53(b) and 59(2) of the Trade Practices Act 1974. It is alleged that what was represented was . 4. also warranted. Damages are claimed under s.82(1) of the Trade Practices Act 1974, and "at common law". In respect of the lease an order is sought of the kind which s.87(2)(a) of that Act authorises, or of the kind which s.87(2)(b) authorises. In respect of loss and damage alleged to have been suffered an order is sought of the kind for which s.87(2)(d) makes provision. The respondent cross-claims against the applicants for money alleged to be due by them to it under the lease agreement and for damages for breach of that agreement. The applicants deny that they are indebted and that they have committed any breach. The cross-respondents are the persons for whose conduct it is alleged by the applicants that the respondent is legally responsible. The following allegations are made by the respondent in its amended cross-claim filed on 30 May, 1984: "10. By the Statement of Claim and the Application herein the Applicant alleges that it is entitled to an Order declaring the lease agreement to be void and to be entitled to damages allegedly suffered by reason of conduct by Electrum in contravention of Part 5 of the Trade Practices Act. il. If the Applicant is so entitled and/or if EBlectrum is unable to recover the sum of $3,027,202.00 plus interest thereon pursuant to the lease agreement as claimed by Electrum's counterclaim herein or some part thereof, Electrum has suffered or alternatively will suffer loss and damage in respect of which, by reason of the matters alleged hereafter, it is entitled to be indemnified by each of the Cross~Respondents. 12. If the Cross-Respondents or any one or more of them in the course of their employment with or as directors of or otherwise as 13. 5. agents of Blectrun, as alleged in the Statement of Claim herein, made the statements, representations, warranties and implications alleged in paragraph 17 of the Statement of Claim herein in contravention of any one or more of sections 52, 53(a), 53¢(b) or 59(2) of the Trade Practices Act, as alleged in the Statement of Claim herein (all of which Electrum has denied in its Defence to the Statement of Claim herein) Electrum has suffered or alternatively, in the event that the Applicant obtains any of the relief claimed in the Application herein, will suffer loss and damage by reason of the said conduct of the Cross-Respondents in respect of which, by reason of the matters alleged hereafter, it is entitled to be indemnified by each of the Cross-Respondents. Further if the Cross-~Respondents or any one or more of them in the course of their employment with Electrum, or in the course of the performance of their duties as directors of Electrum, or otherwise as agents of Electrum, made the statements, representations, warranties and implications set forth in paragraph 17 of the Statement of Claim herein in contravention of any one or more of sections 52, 53(a), 53(b) or 59(2) of the Trade Practices Act, as alleged in the Statement of Claim herein (all of which Electrum has denied in its Defence to the Statement of Claim herein) the Cross-Respondents and each of them have acted in breach of duty to Electrum as follows: - (a) the Cross-Respondents Edward Christiaan Sent and Jon Dean Wilson as directors of Electrum owed to Electrum - (id a duty pursuant to section 124 of the Companies Act 1961 at all times to act honestly and use reasonable diligence in the discharge of the duties of his office; (ii) a fiduciary duty not to cause or permit Electrum to contravene sections 52,53(a), 53(b) or 59(2) of the Act; (iii) a duty to take reasonable care to ensure that Electrum did not contravene sections 14. 6. 52, 53, 53(a), 53¢(b) or ,59(2) of the Act; (iv) a duty to take reasonable care not to do anything which would or might cause loss and damage to Electrunm. (b) The Cross~Respondents Tarak Management Services Pty. Ltd., Corporate Consultants International Pty. Limited, Trevor Burton Huttley and Donald Brownlie Fleming as agents of Electrum owed to Electrum - (1) a fiduciary duty not to do or to cause any other person or company (including Electrum) to do anything which would or might cause loss and damage to Electrum; (ii) a duty at all times whilst acting as such agent to act in the best interests) of Electrum; (iii) a duty to take reasonable care not to do anything which would or might cause loss and damage to Electrum. If the Applicant is held to be entitled to the relief claimed in the Application herein or any part thereof, such entitlement will arise by reason of the conduct and breaches of duty referred to in paragraph 13 hereof and Electrum will thereby suffer loss and damage in respect of which it is entitled to be indemnified by the Cross Respondents." The respondents' claims for relief are expressed thus: "THE RESPONDENT/CROSS-CLAIMANT CLAIMS AGAINST EACH OF THE CROSS RESPONDENTS : - (A) An Order that each Cross-Respondent indemnify the Respondent/Cross-Claimant in respect of - (1) Any amount which it may be ordered to pay to the Applicant in this Proceeding; 7. (2) Any loss and damage which it may sustain by the making of any order against 1t in this Proceeding; (B) Damages; (C) Interest; (D) Costs; (BE) Such further or other relief as is appropriate." Mr. Gillard submitted that the causes of action pleaded against the cross-respondents derive from the common law and State statutes. Mr. Gillard further submitted that the Commonwealth statutory provisions and the Federal Court Rules which authorise the linking of the respondent's claims to curial relief against the cross-respondents with the applicants' claims to relief against the respondent constitute the curial proceeding for the former relief as one which is separate from the applicants' proceeding against the respondent. I shall for present purposes assume the correctness of that submission. It is the next step in Mr. Gillard's argument which is in my opinion unacceptable. He says that, unless a cause of action asserted in the separate proceeding by the respondent against the cross-respondents is founded upon a law made by the Commonwealth Parliament, jurisdiction is not conferred upon this court to hear and determine that proceeding. In Fencott v. Muller (1983) 57 A.L.g.R. 317 at 329 Mason, Murphy, Brennan and Deane J.J. observed: > "Section 86 of the Act provides: 'Jurisdiction is conferred on the Court to hear and determine actions, prosecutions and other pruceedings unde: this Part and that 8. jurisdiction is exclusive of the jurisdiction of any other court, other than the jurisdiction of the High Court under section 75 of the Constitution.' In Phillip Morris Incorporated v. Adam _ P. Brown Male Fashions Pty. Ltd.: United States Surgical Corporation v. Hospital Products International Pty. Ltd. (1981), 33 A.L.R. 465 at p.500, Mason Jd. pointed out that, although s.86 departs from the language of Ch. Tit of the Constitution, nevertheless in its context it confers jurisdiction with respect to 'matters' conformably with s.77¢(i) of the Constitution. The jurisdiction conferred by s.86 upon the Federal _Court which is material in the present case is jurisdiction in respect of matters arising under ss. 52 and 82 of the Act (cf. Constitution ss. 76(ii) and 77(i1)) and is defined to be exclusive of the jurisdiction of the courts of the States (cf. Constitution s.77(ii)). The relevant question is whether the ambit of the jurisdiction thus conferred is wide enough to include the hearing and determination of all the issues raised and the claims for relief made in the amended and modified statement of claim. The ambit of the jurisdiction depends upon the meaning of 'any Matter arising under any laws made by the Parliament' in s.76(ii) of the Constitution. The starting point is the well-known passage from the judgment of the Court in In re Judiciary and Navitation Acts (1921), 29 C.L.R. 257 at p.265, a passage which has found general acceptance: 'It was suggested in argument that 'matter' meant no more than legal proceeding, ... We do not accept this contention; we do not think that the word 'matter' in sec. 76 means a legal proceeding, but rather the subject matter for determination in a legal proceeding. In our opinion there can be no matter within the meaning of the section unless there is some immediate right, duty or liability to be established by the determination of the Court.' It follows that a particular federal matter may be part only of a proceeding (as Menzies J. observed in Felton v. Mulligan (1971), 124 C.L.R. 367, at pp. 382-383) and it is possible to envisage a proceeding where a party seeks to litigate both a federal claim and a distinct and unrelated non-federal claim (as Stephen, Mason, © Aickin and Wilson JJ. observed in Moorgate Tobacco Co. Ltd. v. Philip Morris Ltd. (1980), 31 A.L.R. 161 at p.174). On the other hand particular legal proceedings may relate Lo part only of what should Later 9. properly be seen as the one larger 'matter'. An obvious example is to be found in the not uncommon situation under pre-Judicature Act systems where separate proceedings in equity lay in certain circumstances to enjoin a plaintiff in common law proceedings from pursuing his common law rights. Though the concept of 'matter' may be narrower than that of a 'legal proceeding', it is a term of wide import. 'The word "matters"', Criffith C.J. said in The State of South Australia v. The State of Victoria (1911), 12 C.L.R. 667, at p.675, 'was in 1900 in common use as the widest term to denote controversies which might come before a Court of Justice'. The concept of 'matter' as a justiciable controversy, identifiable independently of the proceedings which are brought for its determination and encompassing all claims made within the scope of the controversy, was accepted by a majority of the Court in Philip Morris." their Honours observed (57 A.L.J.R. at 331-332): "Perhaps it is not possible to devise so precise a formula that its application to the facts of any controversy would determine accurately what claims are disparate and what claims are not. Whatever formula be adopted as a guide - and the formula of 'common transactions and facts' is a sound guide for the purpose - it must result ain leaving outside the ambit of a matter a 'completely disparate claim constituting in substance a separate proceeding' (per Barwick C.J. in Felton v. Mulligan, at p.373), a non-federal matter which is 'completely separate and distinct from the matter which attracted federal jurisdiction' (per Murphy J. Philip Morris, at p.512) or 'some distinct and unrelated non-federai claim' (per Stehen, Mason, Aickin and Wilson JJ. in Moorgate Tobacco, at p.174). Claims which are described by these or similar phrases cannot be determined by exercise of the judicial power referred to in s.71 of the Constitution, for that power can be exercised only to determine those matters in which federal jurisdiction is or can be conferred under Ch. III of the Constitution. For precisely this reason, however, 1t is necessary to attribute to 'matter' in ss. 75 and 76 of the Constitution a connotation which does not deny to federal judicial power its primary character: that is, the power of a sovereign authority 'to decide controversies 10. between its subjects, or between itself and its subjects, whether the rights relate to life, liberty or property' (per Griffith C.J. in Huddart, Parker & Co. Pty. Ltd. v. Moorehead (1909), 8 C.L.R. 330, at p.357). The unique and essential function of the judicial power is the quelling of such controversies by ascertainment of the facts, by application of the law and by exercise, where appropriate, of judicial discretion. In identifying a s.76(i1) matter, it would, be erroneous to exclude a substantial part of what is in truth a single justiciable controversy and thereby to preclude the exercise of judicial power to determine the whole of that controversy. What is and what is not part of the one controversy depends on what the parties have done, the relationships between or among them and the laws which attach rights or liabilities to their conduct and relationships. The scope of a controversy which constitutes a matter is not ascertained merely by reference to the proceedings which a party may institute, but may be illuminated by the conduct of those proceedings and especially by the pleadings in which the issues in controversy are defined and the claims for relief are set out. But in the end, it isa Matter of impression and of practical judgment, Whether a non-tederal claim andaéeé federal claim joined in a proceeding are within the scope of one controversy and thus within the ambit of a matter." That reasoning is contradictory, in my opinion, of any supposition that a separate legal proceeding in which the causes ef action alleged derive from sources other than a law of the Commonwealth Parliament is necessarily outside the ambit of any matter arising under a law made by that Parliament. It is clear, in my opinion, that such a legal proceeding "may relate to part only of what should properly be seen as the one larger 'matter'. An obvious example is to be found in the not uncommon situation under pre-Judicature Act systems where separate proceedings in equity lay in certain circumstances to enjoin a plaintiff in common law proceedings from pursuing his common law rights" (57 A.L.J.R. at 329). 10. between its sutbjects, or between itself and its subjects, whether the rights relate to life, liberty or property' (per Griffith C.J. in Huddart, Parker & Co. Pty. Ltd. v. Moorehead (1909), B C.L.R. 330, at p.357). The unique and essential function of the judicial power is the quelling of such controversies by ascertainment of the facts, by application of the law and by exercise, where appropriate, of judicial discretion. In identifying a s.76(ii) matter, it would be erroneous to exclude a substantial part of what is in truth a single justiciable controversy and thereby to preclude the exercise of judicial power to determine the whole of that controversy. What is and what is not part of the one controversy depends on what the parties have done, the relationships between or among them and the laws which attach rights or liabilities to their conduct and relationships. The scope of a controversy which constitutes a matter is not ascertained merely by reference to the proceedings which a party may institute, but may be illuminated by the conduct of those proceedings and especially by the pleadings in which the issues in controversy are defined and the claims for relief are set out. But in the end, it isa Matter of impression and of practical judgment, whether a non-federal claim anda federal claim joined in a proceeding are within the scope of one controversy and thus within the ambit of a matter." That reasoning is contradictory, in my opinion, of any supposition that a separate legal proceeding in which the causes of action alleged derive from sources other than a law of the Commonwealth Parliament is necessarily outside the ambit of any matter arising under a law made by that Parliament. it is clear, in my opinion, that such a legal proceeding "may relate to part only of what should properly be seen as the one larger 'matter'. An obvious example is to be found in the not uncommon situation under pre-Judicature Act systems where separate proceedings in equity lay in certain circumstances to enjoin a plaintiff in common law proceedings from pursuing his common law rights" (57 A.L.J.R. at 329). il. The claims made by the applicants against the respondent and by the respondent against the cross-respondents all arise, in my opinion, out of common transactions and facts, namely the negotiations for the formation of the partnership in which the applicants joined and for the agreement to lease the aircraft, the making of those two agreements, for partnership and for lease of the aircraft, and the performance and alleged breaches of the latter agreement. The conduct of the cross-respondents which the applicants allege as founding their claims for relief is the conduct upon which the respondent founds its claims for relief. All those claims are, in my opinion, within the ambit of one matter arisng under the Trade Practices Act 1974. When the question was raised on 93 August 1984 as to what directions (which I shail call, for convenience, third party directions) ought to be given in respect of the cross-claims against the cross-respondents, of the kind for which Order 5 Rule 12(2) makes provision, Mr. Perry Q.C., who appears with Mr. Martin for the applicants, indicated some difficulties which he submitted might arise if such directions were given. He instanced two evidentiary questions which would arise in the course of the applicants' case and which might involve those difficulties. One of the misrepresentations alleged by the applicants is that the aircraft was said, shortly before the lease was taken, to be "new" and to have been "manufactured in June 1981", whereas in fact, as the applicants allege, the aircraft had been "manufactured in or about March 1978" and by June 1981 had flown 12. for periods aggregating more than 600 hours. Agreement had been reached, between counsel for the applicants and Mr. Milne Q.C., who appears with Mr. Talbot for the respondent, that a document purporting to be a written statement signed in Spain by an employe of the Spanish manufacturer of the aircraft should be received in evidence as part of the aplicants' case and should constitute evidence of the matters asserted therein, namely that the aircraft had been manufactured in 1978 and had flown for more' than 600 hours. It was not suggested that the document would be admissible, except by consent. As to the effect of consent, see Re Lilley £19533 V.R. 84. Mr. Milne has announced the withdrawal of his consent to the reception of the document in evidence. The question whether the respondent could object to tender of the document after Mr. Milne had given his consent to its reception has not been argued and, for reasons which appear from the transcript of the hearing on 23 August 1984, may never fall for decision. But, Mr. Gillard objected to the tender of the document. If the document were received in evidence by consent of the respondent, and particularly if reliance were placed on it by me to reach a conclusion, to which the rest of the evidence had not brought me, that the applicants' claim for damages against the respondent should succeed, how could it accord with justice that the respondent and the cross-respondent for whom Mr. Gillard appears, or that the respondent and any other cross-respondent who had not consented to the admission of the document, should be bound by a judgment against the respondent founded on such a conclusion? Mr. Perry also seeks to tender a pleading filed in 13. another proceeding in this Court as an informal admission by the respondent, on whose behalf the pleading was filed, of facts alleged therein and tending to prove an issue joined between applicants and respondent. Those same facts tend to prove the same 1ssue which it is for the respondent to prove in order to establish certain of its cross-claims, including the cross-claim against the cross-respondents for whom mr. Gillard and Mr. Rigall respectively appear. The admissibility of such a pleading is denied by Mr. Milne and Mr. Gillard and Mr. Riggall. There are contradictory authorities on that question of admissibility. But if the pleading were received in evidence as an admisson by the respondent, and if the admission were all that supported proof of those facts, should the cross-respondents for whom Mr. Gillard and Mr. Riggall appear be bound by a judgment against the respondent which rests upon the admission? Before proceeding further in consideration of third party directions, [I turn to consider another application made by Mr. Perry, under Order 29 Rule 2(a), for an order for the decision of the questions raised by the pleadings in respect of the applicants' claims against the respondent other than questions of damages and other relief separately from those latter questions of damages and other relief, and separately from all questions raised by the pleadings in respect of the respondent's cross-claims against the applicants. No party appearing before me opposes the application and it seems to me that such an order should be made. I order that the issues raised by paragraphs 1-19 (inclusive), the second sentence of paragraph 20 and paragraph 21 of the amended statement of claim filed on 22 November, 1982 and paragraph 1-21 14. (inclusive) of the respondent's amended defence filed on 2 February 1984 and the questions of law arising in respect of those said paragraphs be tried and decided by me before and separately from any other issues raised by the pleadings between the applicants and the respondent on their claims and cross-claims. On 24 August 1984 I gave the applicants leave to amend the statement of claim by adding an allegation that the respondent had contravened s.52(1) of the Trade Practices Act 1974 - "by proffering the lease agreement for execution by the applicant or hy accepting the same when it knew or ought to have known:- (i) that the aircraft had been represented to the applicant or a substantial number of those comprising the applicant partnership as new; (ii) that the representations particularised in paragraph 17 had been made." The application was opposed by Mr. Milne on the ground that, as more than three years had elapsed since the events sought to be pleaded had occurred, to grant leave to amend now would be to contravene the rule of practice known as the rule in Weldon v. Neal (1887) 19 Q.B.D. 394. No submission was advanced that any provision of this Court's rules had displaced that rule of practice, and I shall therefore assume, but without deciding, that the rule is to be observed in this Court. If it be only against the addition by amendment of a ' 15. different cause of action, in the technical sense of that phrase, that the rule is directed, then in my opinion no new cause of action, but only an alteration, by addition, to what Barwick C.J. called, in Black v. City of South Melbourne (1964) 38 A.L.J.R. 309 at 310, the "particularizing of the facts", is to be found in the proposed amendment. If, on the other hand, regard is to be had to considerations formerly thought important in the application of the rule - whether, in the words of Gowans J. in Hall v. National & General Insurance Co, Ltd. £19671 V.R. 355 at 366, "the proposed amendment is sufficiently closely related to what is already alleged that it would not be unfair to treat it as another way of putting the same claim" - I donot doubt that this amendment should be allowed. (See the article by S. Campbell in 54 A.L.J. 643). Reverting to the question of third party directions, there seems to be no doubt that the issues and questions thus to be tried and decided first between the applicants and the respondent should be tried and decided by me with those of the said issues and questions which are raised by, or which arise in respect of, the pleadings between the respondent and a cross-respondent, other than Corporate Consultants International Pty. Ltd. One of the principal purposes for which third party proceedings were ordained was to achieve by contemporaneous trial before the one tribunal consistency of decision of an issue which is raised - and of a question of law to be decided - between one person and another and also between that other and a third person. Some further issues and questions which are raised by, or which arise in respect of, the pleadings between the respondent 16. and the cross-respondents, but which are foreign to the claims on the originating process, can conveniently be heard with the issues and questions between applicants and respondent which I have ordered to be heard and determined first; others not. The segregation of the one class from the other will be deferred for the time being. I propose to give no further third party directions at present. Neither the authorities to which counsel have referred me and which I have been able to consult nor other authorities upon third party directions which I have considered have resolved for me the difficulties which I fear may arise upon exercise of a power conferred by paragraph (c) or (f) of Order 5 Rule 12(2). My fears have not been quietened by the divergent views expressed by members of the High Court in Helicopter Sales (Aust.) Pty. Limited v. Rotor-Work Pty. Limited and Another (1974) 48 A.L.J.R. 390. In that case the plaintiff had obtained a judgment for damages for breach of a contract with the defendant for the servicing of a helicopter by the defendant, and the defendant had obtained judgment against a third party from whom the defendant had bought a spare part which it had installed in the helicopter in the performance of its contract with the plaintiff, and the failure of which had caused the damage in respect of which the plaintiff had obtained judgment. Appeal was brought in the High Court by the third party against both judgments. Four of the five members of that Court were of opinion that there should have been judgment for the defendant and judgment accordingly for the third party. Stephen J. observed (48 A.L.J.R. at 394-395): 17. "However the defendant has not appealed against the plaintiff's judgment against it; it is the third party alone which is an appellant and it seeks to appeal not only against the defendant's judgment against it but also against the plaintiff's judgment against the defendant. An order hy way of third party directions was made before the trial of this action by which leave was given to the third party 'to defend the Plaintiff's action' but that order was silent concerning 'the extent to which the third party is to be bound by any judgment or decision in this action' - Supreme Court Rules (Q.) 0.17, r.4(4). Those rules, unlike the rules of some other States - €.g., Supreme Court Rules (Vic.), 0O.16A, vr.11(b)(iii), do not provide that upon the third party entering an appearance he shall thereafter be bound by the result of the trial and in the absence of a court order it is at least doubtful whether the third party would be bound by or be competent to appeal against the judgment in favour of the plaintiff. No attack was in fact made upon the competency of the third party's appeal against the judgment in favour of the plaintiff; the plaintiff's5 counsel took the leading role in presenting the respondents' arguments before us and it was only the third party's appeal against the judgment in favour of the plaintiff that was in fact argued, its outcome being treated as decisive of the fate of the other appeal. In these circumstances, and despite the absence of any order such as might have been made under 0.17, r.4(4), the appropriate course appears to be to treat the matter as the parties have chosen to, to deal with both of the third party's appeals as if an order had been made binding it by the result of the trial of the issues between plaintiff and defendant - Asphalt and Public Works Ltd. v. Indemnity Guarantee Trust Ltd., £19691 1 Q.B. 465, at p.471. To do otherwise, allowing only the appeal against the defendant's judgment and that only to the extent of the damages awarded, the defendant remaining entitled to nominal damages for breach of contract, appears to be a wholly unsatisfactory alternative. I would accordingly allow each of the third pParty's appeals." But Barwick C.J. party directions: took a different view of the effect of the third Mason is. "IT also agree that the appellant's appeal against the decision in favour of the plaintiff in the action against the defendant, the now second respondent R. W. Engineering Pty. Ltd., should be treated as competent. I would wish to add on my own behalf that I do not share the doubts expressed by my brother Stephen as to that competence. It seems to me thata third party who is given leave to defend a Plaintiff's action, and who does so, is bound by the result of the issues which that third party contests. That it seems to me is so, not only on Principle but having regard to the case law on 0.16 +.4, of the (United Kingdom) Supreme Court Rules, see White Book, 1973 Vol. 1, p.229. In my opinion the function of par. 4 of that rule, and of like words in 0.17, r.4(4), of the Rules of the Supreme Court of Queensland, is to enable the Court to limit the extent to which such a third Party may be so bound. In my opinion, the result of the third party contesting issues in the action does not depend on the making of an order determining the extent to which the third party should be bound but upon the making of an order giving the third party leave to defend the plaintiff's action. Further, where a third party does contest that action without leave to defend having been given, 1t may well be proper to deal with the case as if an order giving leave had been made. I would allow each of the appeals brought by the appellant third party." (48 A.L.J.R. at 390) J. observed (48 A.L.J.R. at 395): "I do not feel that there is any difficulty in dealing with both of the third party's appeals. The third party defended the plaintiff's action pursuant to an order giving leave so to do. Although no order was made binding the third party to the result of the trial of the issues between the plaintiff and the defendant, it was in my view in these circumstances entitled to appeal against the judgment against the defendant. I should have taken the same view had the third party defended the plaintiff's action without the benefit of an order giving it leave so to do. Accordingly, I would allow both appeals by the third party." 19. If considerations of procedural convenience and costs be put to one side as of secondary importance, as I think that they should, three considerations of cardinal importance seem to me to be relevant to the exercise of powers such as paragraphs (c), (d) and (f) of Rule 12(2) of Order 5 confer. First, the benefit of admissions or of other conduct of a respondant, which has not occurred in the course of the proceeding, but which facilitates the proof of the applicant's case, is not lost by the applicant in consequence of the grant of leave to a third party "to defend the claim on the originating process". Second, a third party should not be bound by the determination of issues joined between applicant and respondent upon evidence which would not be admissible against the third party upon trial of that issue joined between respondent and third party. Third, the applicant suffers, ordinarily, no injustice if defences available to the respondent but not pleaded by him are allowed to be raised against the applicant's claim by a third party guarantor or indemnifior of the respondent, or if evidence inadmissible against the respondent is excluded upon the objection, not taken by the respondent, of the third party. (See Barton v. London and North Western Railway Co. (1888) 38 CH. D. 144; Callinder v. Wallingford (1884) 53 L.J.Q.B. 569 at 570-571; and cases cited in Williams' Supreme Court Practice, para. £16A.8.1.1.) If at the close of the applicants' case it were to appear that the applicants' case against the respondent depended in some substantial respect upon an informal admission made on the 20. respondent's behalf, that might be a reason for exercising the power conferred by Order 5 Rule 12(2)(f) in such a way as to free third parties from being bound by the decision of one or more issues between applicants and respondent. But if a third party who defends a claim is bound by the decision of that claim, as Barwick C.J. thought, it would be imprudent to go further at this stage than the third party directions already given. On 24 August 1984 I ruled admissible certain documents tendered hy counsel for the applicants. I now state my reasons for that ruling at greater length than time permitted on that day. The documents were copies of returns which had heen lodged with the Commissioner for Corporate Affairs of the State of Victoria in compliance with the requirements of s.134(6) of the Companies Act 1961 of that State. The returns, which had been lodged by several companies incorporated under that Act, indentify the directors of the companies respectively during certain periods in and about 1981. The copies of the returns were recently given, and certified, by the National Companies and Securities Commission in compliance with a requirement made on the applicants' behalf under s.31(2)(c) of the Companies (Victoria) Code. The documents in respect of which such a requirement may be made include "any document lodged with .... the Commissioner for Corporate Affairs or the Registrar of Companies" : see s.31(2)(a) of that Code. A copy of such a document which has been so certified is declared, by s.31(5) of the Code, to be "admissible in evidence as of equal validity with the original document". Section 8 of the State and Territorial Laws and Records Recognition Act 1901 (Cwth) provides: 21. "Whenever by any State Act at any time in force in any State, or by any law of a Territory at any time in force in any Territory - (a) any public document; or (b) any record required by law to be kept of any public document or proceeding; or (c) any certified copy of any public document or by-law or of any entry in any public register or book is admissible in evidence for any purpose in that State or Territory, 1t shall be admitted in evidence to the same extent and for the same purposes, in all Courts if it purports to be sealed or impressed with a stamp, or sealed and signed, or signed alone, or impressed with a stamp and signed, as directed by such State Act or law of a Territory, without any proof of such seal stamp or signature or of the official character of the person appearing to have signed the same, and without any further proof thereof in every case in which the original document could have been received in evidence." The question then is whether the returns are public documents within the meaning of that expression ins.8 of the State and Territorial Laws and Records Recognition Act 1901. I respectfully accept what Bray C.J. said of the expression "public document" in that section: "The phrase 'public document' is not defined : but I think it bears the well-known legal meaning attached to it in the law of evidence and crystallized in Lord Blackburn''s speech in Sturla v. Freccia when he said :- 'I understand a public document there to mean a document that is made for the purpose of the public making use of it, and being able to refer to it ... I think the very object of it must be that it should be made for the purpose of being kept public, so that the persons concerned in it may have access to it afterwards.'" (Crawford Earthmovers Pty. Ltd. v. Fitzsimmons (1972) 4 S.A.S.R. 116 at 128; 10 F.L.R. 123 at 129.) 22. The returns were made, and are still kept, for the purpose of the public making use of them by having access to then. Section 12(2)(a) of the Companies Act 1961 provides that a person may, on payment of the prescribed fee, inspect any document lodged with the Commissioner for Corporate Affairs. The Commissioner was empowered, by 3s.12(7) of that Act, to destroy or dispose of such returns after the expiration of fifteen years after lodgment, if in his: opinion it was no longer necessary or desirable to retain then. When in 1982 the provisions of the Companies Act 1981 of the Commonwealth were made applicable as laws of Victoria, to the exclusion of the provisions of the Companies Act 1961, continuity was preserved by the following provisions of the Companies (Application of Laws) Act 1981: "20. Uniess the contrary intention appears in this Act or in the Companies (Victoria) Code all persons, things and circumstances appointed or created by or under the Companies Act 1961 or existing or continuing under that Act immediately before the commencement of this Act shall, under and subject to this Act and to the Companies (Victoria) Code, continue to have the same status, operation and effect as they respectively would have had if this Act had not been enacted. 21. Without affecting the generality of section 20, unless the contrary intention appears in this Act, or in the Companies (Victoria) Code, neither this Act nor the Companies (Victoria) Code disturbs the continuity of status, operation or effect of any order, rule, regulation, scale of fees, appointment, conveyance, mortgage, charge, deed, agreement, resolution, direction, approval, application, requisition, instrument, document, memorandum, articles, incorporation, nomination, affidavit, call, forfeiture, minute, assignment, register, registration, transfer, list, licence, certificate, security, notice, compronise, arrangement, right, priority, liability, duty, obligation, proceeding, matter or thing made, 23. done, effected, given, issued, passed, taken, validated, entered into, executed, lodged, filed, accrued, incurred, existing, pending or acquired by or under the Companies Act 1961 before the commencement of this Act." Destruction or disposal of returns lodged under the Companies Act 1961 may now be effected by the Commission under 5.31(10) of the Companies (Victoria) Code, which confers a power similar to that conferred By s.1i2(7) of the Companies Act 1961, or under s.42 of the Companies (Application of Laws) Act 1981, which relates only to foreign and recognised companies. The returns may therefore be taken as parts of sets of documents compiled and lodged and kept for a substantial period in compliance with statutory command for the purpose of public inspection to disclose the facts recorded therein. But it was a further condition of admissibility as a public document that "the official making the record should either have had personal knowledge of the matters which he was recording or should have enquired into the facts" (Req. v. Halpin £19751 Q.B. 907 at 915) and that, when such an enquiry was made, what was recorded were "matters which it was the duty of the public officer holding the enquiry to inquire into and report on" (Thrasyvoulos Ioannou v. Papa Christoforos Demetriou £19523 A.C. 84 at 95), The returns under present consideration were required to be signed either by a secretary or a director of the company to which the return related : Companies Regulations 1976, regs. 5, 7 and Form 43. Default in compliance with any of the statutory obligations imposed by s.134(6) of the Companies Act 1961 on the company to lodge returns was an offence against that Act by the company and "every officer 24. of the company who is in default" : s.134(7). To lodge a return containing a false statement would in my opinion be to make default in complying with the obligation to make that return. Each officer, whether secretary or director, who made the returns under present consideration was in my opinion under a duty to make a true return and may in my opinion be taken to have had personal knowledge of the matters contained in the return. But the Commissioner for Corporate Affairs, the public official in whose custody the returns, when lodged, formed part of a record open to public inspection, neither had any knowledge of the matters contained in the returns nor owed any duty to enquire whether the Matters in the returns were correctly stated. The returns are in like case with the returns held admissible in evidence as public documents in Reg. v. Halpin £19751 Q.B. 84. Speaking for the Court of Appeal, Geoffrey Lane, L.J. observed (£19751 Q.B. at 915): "It seems to be inescapable from those authorities that it was a condition of admissibility that the official making the record should either have had personal knowledge of the matters which he was recording or should have inquired into the accuracy of the facts. There is no doubt that in a case such as_ the present the official in the Companies Registry has no personal knowledge of the matters which he is putting on the file or recording. There is equally no doubt that it would be most convenient if the identity of directors and so on could be established simply by production of the file from the company's register containing the returns made by the company. We do not, however, feel that convenience on its own is an adequate substitute for precedent, tempting though such a_ solution might be. The common law, as expressed in the earlier cases which have been cited, was plainly designed to apply to an uncomplicated community when those charged with keeping registers would, more often than not, be personally acquainted with the people whose affairs they were recording and 25. the vicar, as already indicated, would probably himself have officiated at the baptism, marriage or burial which he later recorded in the presence of the churchwardens on the register before putting it back in the coffers. But the common law should move with the times and should recognise the fact that the official charged with recording matters of public import can no longer in this highly complicated world, as like as not, have personal knowledge of their accuracy. What has happened now is that the function originally performed by one man has had to be shared between two : the first having the knowledge and the statutory duty to record that knowledge and forward it to the Registrar of . Companies, the second having the duty to preserve that document and to show it to members of the public under proper conditions as required. Where a duty is cast upon a limited company by statute to make accurate returns of company matters to the Registrar of Companies, so that those returns can be filed and inspected by members of the public, the necessary conditions, in the judgment of this court, have been fulfilled for that document to have been admissible. All statements on the return are admissible as prima facie proof of the truth of their contents." It was submitted by Mr. Gillard that the decision of the Court of Appeal was inconsistent with established principle governing the admissibility of the contents of a public record. The principle that the person making the record should be under a duty to make enquiry as to the existence of the facts to be recorded is established by authority binding upon me 3: Thrasyvoulos Ioannou v. Papa Christoforos Demetriou, supra isa decision of the Privy Council. But neither in that case nor in the cases wherein the principle had been developed was there advertence to the possibility of a division of function by statutory command, to which division Geoffrey Lane L.J. refers. Those cases are therefore in my. opinion distinguishable; and I think myself free to follow the later decision of the Court of ob n 26. Appeal. If free, I should hesitate not to follow that decision : see the cases collected in Aust. Digest (2nd ed.) vol. 32, pp. 63-66. The ruling of Hart J. in Linehan v. Queensland Trustees Ltd. £19653 Qd. R. 559 at 575 appears to be contradictory of the conclusion reached by the Court of Appeal. It is, however, that conclusion which I think that I should accept. Mr. Perry tendered a statement of claim which had been filed on behalf of the respondent as an applicant in another proceeding in this Court. Several facts alleged on the respondent's behalf in the statement of claim were relevant to issues joined in this proceeding between applicants and respondent and the tender was justified by the submission that those allegations in the statement of claim constituted informal admissons of those facts by the respondent. I reject the pleading as inadmissible to prove those facts. I am not prepared, as a single judge, to disregard the authority of Boileau v. Rutlin (1848) 2 Ex. 665; 154 E.R. 657. In that case the defendant tendered in evidence, ona trial at the assizes of an action in the Court of Exchequer, the plaintiff's bill in Chancery praying specific performance of an agreement alleged in the bill to have been made between plaintiff and defendant, in proof of the making of that agreement and of its terms. Admitting the bill, the trial judge directed a verdict for the defendant, reserving leave to the plaintiff to move to enter a verdict for the plaintiff if the Court should be of opinion that the bill was inadmissible. The Court in banc was of that opinion, holding that the assertions in a pleading are not admissions of J 27. the facts asserted by the party on whose behalf made. The Court in banc accordingly made absolute a@ verdict for the plaintiff. The reasons f unanimous judgment were delivered by Parke, B. the Court applied the decision to common 1 the pleading was a rule nisi for or the Court's Five years later aw pleadings : Buckmaster v. Meiklejohn (1853) 8 Ex. 634; 155 E.R. 1056. Those decisions have been followed in three State Supreme Courts : McKinlay v. North Australian Co. (1869) 3 5.A.L.R. 135; Austin v. Austin £1905] V.L.R. 564; Kleeners Pty. Ltd. v. Lee Tim (1959) 78 W.N. (N.S.W.) 746. In Singleton v. John Fairfax & Sons Ltd. £1982] 2 N.S.W.L.R. 38 at 51 Hunt J. declined to follow those decisions: His "My own conclusion therefore is that pleadings should not be placed in any special category which automatically precludes their use by way of admission in every case unless they are sworn. In my opinion, pleadings should be treated in the same way as any other form of admission. Whether or not the filing of a pleading may be used by way of admission of the truth of any fact it alleges should depend upon whether (to use the words of Wigmore, at p 49) they are seen to have been 'not intended to be taken as sincere or absolute assertions'. As with any other form of informal admission, the party against whom the pleading is tendered should be able to lead evidence which explains or contradicts the effect of the admission which it made. There has been no authority cited to me by which I am bound to act contrary to that conclusion. In accordance with it, I am satisfied that an imputation pleaded ina statement of claim as required by Pt 67, r 11(2) is admissible evidence by way of admission against the plaintiff that the Matter complained of conveyed that imputation in fact." Honour regarded the authority of the English decisions as 28. weakened by the difficulty which Hodges J. (in Austin v. Austin, supra) and Maguire J. (in Kleeners Pty. Ltd. v. Lee Tim, supra) had experienced in reconciling them with principle, which His Honour expounded thus: "I find it impossible myself to see why pleadings should be placed in the special category which these old cases appear to have erected, and why they should not be dealt with in the same way as any other form of admission. In every case where an admission is sought to be proved it is necessary to consider the circumstances in which the admission 1s said to have been made and its context to see whether the document or statement relied upon can properly be regarded as such an admission. Thus if the statement sought to be tendered is one made in a pleading which asserts a number of inconsistent claims or pleas then obviously the pleading could not logically or rationally amount to an admission as to the truth of the particular statement tendered. But a statement by a plaintiff in his statement of claim in which, as required by Pt. 67, r.11(2), he has deliberately specified the imputation (and thereby the cause of action) upon which he relies seems to me in this day and age of pleading to be one quite unaffected by the problems which beset both equity and common law pleadings in bygone times." The "problems" to which Hunt J. refers were adumbrated in his reasons for judgment. He also pointed out that Wigmore supported his conclusion. I am not persuaded to prefer the application to pleadings of the principles which Hunt J. stated to a simple rule of exclusion, whereby often unprofitable collateral enquiries concerning the circumstances under which an allegation was included in a pleading are avoided. (See also the reasoning of Atkin L.J. in British Thomson - Houston Co. Ltd. v. British Insulated and Heisby Cables Ltd. £1924] 2 Ch. 160 at 167 et seq., 29. espec. 167-171, 176-181, much of which might be thought applicable to pleadings.) Even if I were so persuaded, I would not think myself justified, as a single judge, in departing froma rule of ' evidence which has so illustrious a source and so long a period of general acceptance in the courts of this country. I I certify that this and the ia weafty-erghl a3 vpre 7g Pames ure a tiuc copy of the "Vtiaee for Julgmeat herein of the Ly, :. te Aa. Juctee JENKINSON wt due be