2 eee Beene eee - -—- LIMITED DISTRIBUTION CATCHWORDS PRACTICE AND PROCEDURE - Application to strike out Statement of Claim ~ Whether Statement of Claim pleads a cause of action known to the law - Costs - Undertaking by solicitors to indemnify client against order for costs. Petroleum Retail Marketing Franchise Act 1980 Trade Practices Act 1974 s.47(2)(e) NSW G.333 of 1985 DOUGLAS RONALD BENNETT & ANOR v_ BP (AUSTRALIA) LIMITED Wilcox J Sydney 28 February 1986 ewe ee te De eee ee ee ce ee ye ord LIMITED DISTRIBUTION IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION No. G.333 of 1985 BETWEEN : DOUGLAS RONALD BENNETT First Applicant JUDITH ANN BENNETT Second Applicant AND: BP (AUSTRALIA) LIMITED Respondent CORAM: WILCOX J. DATE: 28 FEBRUARY 1986 PLACE: SYDNEY MINUTE OF ORDERS THE COURT ORDERS THAT: 1. The Statement of Claim be struck out. ate nA er nn tote * - ~t Leave be granted to the applicants to file and serve within twenty-one (21) days of today a further amended Statement of Claim and, if so advised, an amended Application. The applicants pay to the respondent its costs of the motion. AND THE COURT NOTES : NOTE: The undertaking given to the Court by the solicitor for the applicants, Mr Warren Wells, that he will personally indemnify his clients against the cost of complying with this order. Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. LIMITED DISTRIBUTION IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY No. G.333 of 1985 w~evenww GENERAL DIVISION BETWEEN: DOUGLAS RONALD BENNETT First Applicant JUDITH ANN BENNETT. Second Applicant : B_P (AUSTRALIA) LIMITED Respondent CORAM: WILCOX J. DATE: 28 FEBRUARY 1986 PLACE: SYDNEY EXTEMPORE REASONS FOR JUDGMENT This is an application made by the respondent in the principal proceeding, BP (Australia) Pty Limited, for an order that the Statement of Claim filed herein be struck out; that, in the alternative, certain paragraphs be struck out; and that, in the further alternative, the proceedings he stayed pending determination of proceedings number 4488 of 1985 in the Equity Division of the Supreme Court of New South Wales. The Statement of Claim which has been filed makes various allegations regarding the circumstances in which the applicants became the lessees of a service station and regarding the supply to the applicants of fuel by a person identified as WL Chaplin, who is said to be a BP agent. It is alleged in para.16 of the Statement of Claim that Mr Chaplin on or about 5 October 1985 refused to deliver further fuel to the applicants. Upon first reading the Statement of Claim I was quite mystified as to the nature of the claim which the applicant sought to litigate. A clue was given by the statement contained in para.l of the Statement of Claim: that on 19 September 1980 the Petroleum Retail Marketing Franchise Act became law, a matter that should not properly be pleaded. But the statement did at least indicate that that Act was regarded as relevant. This clue was reinforced by seeing in the Application a request for certain orders involving amendments to the lease, a form of relief which under certain circumstances may be available under that Act. When the matter came on for hearing Mr Wells on behalf of the applicants in the principal proceeding indicated to the Court the basis upon which the matter is brought. He referred to s.47(2)(e) of the Trade Practices Act 1974, a provision which is not referred to in any way in the pleadings, either directly or by reciting facts falling within that paragraph. The substance of the matter, as I understand it, is that it is claimed on behalf of the applicants that the respondent has engaged in exclusive dealing within the meaning of s.47 in that it has supplied fuel to Mr Chaplin upon the condition that Mr Chaplin will not resupply the fuel to the applicants. I say nothing as to whether or not a case such as that may be made out. There is no evidence that would indicate one way or the other, but it is quite apparent that no such case has been pleaded in the Statement of Claim. The other contention made on behalf of the applicants is that the respondent has infringed s.9 of the Petroleum Retail Marketing Franchise Act 1980. It is said that it, the respondent, as franchisor, entered into a franchise agreement that contains a provision imposing an obligation on the franchisee that is likely to be unduly onerous to perform at the time when it is required to be performed. The relevant provision has been identified by Mr Wells in his submission as being the requirement of the lease which obliges the applicants as lessees to take from the respondent not less than one half of their fuel requirements. It is said by Mr Wells that this provision is one likely to be unreasonably onerous because of certain activities by the respondent in relation to marketing. None of those activities have been pleaded, nor has there been any allegation made in terms of the matters required to be established to invoke s.9. Once again, I have no opinion whatever as to whether it is possible for the applicants to make out such a case, but I simply say that no such case has been pleaded. So far as I can detect, the existing Statement of Claim pleads no cause of action at all. It should not be allowed to remain upon the record. In my opinion it would he impossible for the respondent to plead to that Statement of Claim. The Statement of Claim appears to contain a number of allegations which are, on any view of the matter, quite irrelevant and it fails to plead the allegations which are critical to the causes of action upon which it appears that the applicants desire to rely. I am of the opinion that the Statement of Claim should be struck out but that leave should be given to the applicants to amend the Statement of Claim by filing a fresh Statement of Claim, if so advised, within a period of 21 days from today. On behalf of the respondent, Mr Bathurst asked for costs of the motion. In my view this application is irresistible. This is not a case in which a respondent has rushed in with an application to strike out a pleading. It appears from the affidavit of Georgina Joan Elliott, filed on behalf of the applicant on the motion, that upon receipt of the Statement of Claim a letter was sent to the solicitor for the applicants dated 19 December 1985 indicating the view of the solicitors for the respondent that the Statement of Claim did not disclose any course of action. Particular reference was made to certain paragraphs. The solicitors invited the solicitor for the applicant to amend the Statement of Claim so as to properly plead the cause of action upon which the applicants rely. It was indicated that if there was not an appropriate amendment the Court would be asked to make appropriate orders. A follow-up letter was sent on 14 January 1986 and again on 22 January 1986 following a telephone conversation in which Mr Wells sought an extension of seven days in order to file an amended Statement of Claim. An amended Statement of Claim was filed on 20 January 1986, but this merely rectified errors of description of the parties which were contained in the original Statement of Claim and it provided no improvement on the earlier Statement of Claim in relation to the matters of substance to which I have referred. Thereupon the present notice of motion was filed. It seems to me that the respondent had no alternative whatever other than to approach the Court in order to have the situation rectified. - - . . I therefore propose to make an order that the applicants pay the respondent's costs of the motion. However, this leaves a situation which in my opinion is most unsatisfactory. The applicants entrusted the conduct of this litigation to their solicitor. He filed a Statement of Claim which was manifestly defective andsnotwitnstanding a generous opportunity to rectify the matter without the necessity for an application of the Court, he failed to do so. Upon the hearing of the application it quickly became obvious that the Statement of Claim could not be defended with the result that an order for costs had to be made in favour of the other side. It seems to me highly unsatisfactory that in such a situation the lay client should be left to bear the costs of such an application. The fault rests with the solicitor who has the conduct of the matter and he should bear the costs. If it be the fact that the Statement of Claim is defective because appropriate advice was not obtained from counsel experienced in considering causes of action and drafting pleadings, the fault lies with the solicitor for not engaging such counsel. Solicitors who handle litigation personally must be required to do so with the same degree of competence and efficiency as counsel. I raised this matter with Mr Wells and asked hin whether he was prepared to give an undertaking to the Court that he would indemnify his clients in respect of the order for costs. To his credit, he immediately indicated that he would do so. I accordingly accept the undertaking which is offered. The orders I make are as follows: the Statement of Claim is to 'be struck out. I grant leave to the applicants to file and serve within 21 days of today a further amended Statement of Claim and if so advised an amended Application. I order that the applicants pay to the respondent its costs of the motion. I note the undertaking given to the Court by the solicitor for the applicants, Mr Warren Wells, that he will personally indemnify his clients against the cost of complying with that order. x I certify that this and the six (6) preceding pages are a true copy of the Reasons for Judgment herein of his Honour Mr Justice Wilcox. Associate: Wren me A Hetforw Date: 18 April 1986 Appearance for the applicant: Mr W Wells, Solicitor Solicitors for the applicant: Messrs Wells & Associates Counsel "for the respondent: Mr T Bathurst Solicitors for the respondent: Messrs Clayton Utz Date(s) of hearing: 28 February 1986 ie a i ae 2 STR ea rc FReeer ta heal Ted WH VID + os one re een ine ere 4