JUDGMENT No. 466.7, 88... NOT FOR DISTRIBUTION CATCHWORODS PRACTICE AND PROCEDURE ~ interrogatories -— leave to interrogate — general principles - matters not in issue - matters within knowledge of interrogator - request for particulars. Federal Court Rules Trade Practices Act ss.52 and 82 Aste v Stumore (1883) 13 QBD 326 Abduramanoski v Aidan Nominees Pty Ltd (unrep. 2.11.87) Conde v 2KY Broadcasters Pty Ltd (1982) 2 NSWLR 221 KINTYRE HOLDINGS PTY LTD V BARWOOD PARKER PTY LTD and MICHAEL PARKER No. WAG 121 of 1987 FRENCH J. PERTH 12 AUGUST 1988 IN THE FEDERAL COURT NOT FOR DISTRIBUTION OF AUSTRALIA DISTRICT REGISTRY WESTERN AUSTRALIA ) ) ) GENERAL DIVISION No. WAG 121 of 1987 BETWEEN KINTYRE HOLDINGS PTY LTD Applicant and BARWOOD PARKER PTY LTD First Respondent and MICHAEL PARKER Second Respondent MINUTE OF ORDER JUDGE MAKING ORDER: FRENCH J. DATE OF ORDER: 12 August 1988 WHERE MADE: PERTH THE COURT ORDERS THAT: 1. Leave to the respondents to interrogate in terms of interrogatories 1.1 as amended, 1.2 to 1.7 inclusive, 3.1, 3.2, 6.1, 6.2 and 6.3. A new notice of these interrogatories to be filed and delivered on or before 19 August 1988. The applicant is to file and deliver answers on or before 2 September 1988. Costs today in the cause. The directions hearing will be adjourned to 9 am on 14 September 1988. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. — IN THE FEDERAL COURT OF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY GENERAL DIVISION ee eww No. WAG 121 of 1987 BETWEEN: KINTYRE HOLDINGS PTY LTD Applicant and BARWOOD PARKER PTY LTD First Respondent and MICHAEL PARKER Second Respondent CORAM: FRENCH J. 12 August 1988 EX TEMPORE REASONS FOR JUDGMENT ON LEAVE TO RESPONDENTS TO INTERROGATE The applicant in this case is a land developer and the first respondent a civil and structural engineer. The second respondent is a director of the first respondent. According to the statement of claim, the applicant engaged the first respondent in or about February 1985 to design certain works, including a water supply system and dam, for a proposed subdivision at Quininup in Western Australia. The first respondent was also to prepare an estimate of the cost of the scheme. Various implied terms of the engagement are pleaded, including the use of reasonable care and skill in the design and cost estimation of the works. Specifically it is alleged that there was an implied term we rn tie aye = oy tava 2. that the first respondent would make reasonable enquiries of statutory authorities, including the Water Authority of Western Australia, as to their design requirements. The common law duty of care and the fact of the applicant's reliance upon these estimates in assessing the financial viability of the scheme and making financial arrangements are also pleaded. The first respondent is said to have breached the implied terms and the common law duty of care by preparing estimates for a water supply system which did not comply with the requirements of the Western Australian Water Authority and which failed to take account of the Authority's policy of requiring drinking water to be treated according to criteria established by the Department of Health. In particular, it is alleged, that the first respondent failed to approach the Authority to enquire as to its requirements, or to determine whether they could be relaxed or waived in any respect. It is said to have failed to make allowance for the cost of a water treatment system and to have increased its estimates of costs for the water supply system from $339,000 on 7 August 1985 to $1,693,500 on 7 July 1986 and for costs of the dam from $99,000 on 7 August 1985 to $408,000 on 24 January 1987. In the event the respondent's estimated cost estimates for the dam were greatly exceeded on tender. It is also said to have designed a dam which did not meet the Authority's requirement for the construction of the spillway and to have failed to comply with published standards for construction of the dam. The respondents are alleged to have negligently eee 3. misrepresented the estimated costs from time to time, and particulars of a number of estimates offered are set out in para.10 of the statement of claim. These representations are also said to have constituted conduct in contravention of s.52 of the Trade Practices Act. The scheme, says the applicant, was thereby delayed while other engineers redesigned the water supply system and negotiated with the Water Authority as to its requirements for the treatment of water and the design of the dam spillway. Delay was also attributed to obtaining Water Authority approval of the dam design and water supply re-design. Various losses flowing from the respondents' conduct are claimed, totalling $481,833. The claims are for damages under s.82 of the Trade Practices Act and at common law. The respondents by their defence say that the first respondent was engaged initially for the limited purpose of providing "a rough engineer's estimate for a recreational dam for a possible future project at Quinninup". This engagement was first undertaken in October 1983 and the first respondent provided an estimate for adam similar to an existing dam at the Karri Valley Resort in the South West of Western Australia. They say that one Crimp, on behalf of the applicant, asked for an estimate of the cost of the design and construction of an alternative dam, 1 kilometre down stream of that for which the initial estimate was provided. The first respondent says it advised the applicant orally in November 1983 that the design of the alternative dam wall was about $300,000 or $500,000 , depending on the size of the spillway. They were not told, they say, the precise proposed dimensions or specifications or capacity of the dam, nor that it 4. was required for water supply purposes. The respondents deny that the first respondent was to seek the approval of any statutory authority as to the design of the water system. They say they relied entirely on the applicant to inform them of any such approvals or conditions attaching thereto. They say that the first respondent gave a written estimate on 6 June 1986 which expressly drew attention to the fact that water quality treatment over and above chlorination was not included. The other figures set out in the applicant's statement of claim in para.10 were, it is said, figures provided by statutory authorities and communicated as such to the applicants. The matter comes before the Court today on the question of leave sought by the respondents to administer certain interrogatories to the applicant. Before a party to proceedings in this Court may administer interrogatories, it has to obtain the leave of the Court to do so. That is a requirement imposed by 0.16 r.1 which provides:- "1(1) The Court may, in its discretion, give leave to any party to file and serve upon any other party, within the period limited by the Court for this purpose, a notice requiring the party served to answer interrogatories relating to any matter in question between the interrogating party and the party served." That requirement was introduced into the rules of this Court in 1986 but has, in fact, existed under the English Rules of ' the Supreme Court since 1883. Its genesis there was explained by as cre ae ee ee 5. Bowen LJ in Aste v Stumore (1883) 13 QBD 326 at 329 and that explanation is set out in my decision of Abduramanoski v Aidan Nominees Pty Ltd (unrep. 2.11.87). It is evident from the judgment of the Master of the Rolls in Aste v Stumore (supra) that the leave requirement is not simply a matter for determination by consent of the parties. As he there said:- "The Rules of the Supreme Court, 1883, were made by the judges, and what I understand the view of the Rule Committee to have been is, that they ought to protect the parties litigant against themselves, even although it should be said that they consented to interrogatories such as I have mentioned".(at 329) It is not part of the function of the Court on a leave application to settle interrogatories, but rather to decide whether they should be permitted. The discretion conferred by 0.16 r.i is a broad one and it is inappropriate to codify it, but the underlying purpose is reasonably clear and that is to enable the Court to regulate the availability of the facility of interrogation and discharging that function it will have regard to a number of factors, in particular, the necessity for and utility ef the proposed interrogatories to the fair and expeditious conduct of the proceedings. The factors that may be taken into account at that stage are necessarily wider than the grounds of objection to the provision of particular interrogatories which are set out in 0.16 r.6(3), although the existence of such objections may be taken into account in the decision whether to grant leave. In a case such as the present, where I consider the question of leave to interrogate on the basis of a draft of the proposed interrogatories, it is convenient to deal both with the question 6. of leave and with specific objections as they arise. Turning to the interrogatories for which leave is sought, I do not propose to offer elaborate reasons for granting or withholding leave in each case, but will deal with each of them seriatim. Interrogatory 1. This interrogatory ina number of parts seeks information from the applicant about whether it made enquiries to the Water Authority of Western Australia as to their statutory requirements for the water supply system, the recreational dam and other matters related to the design of the dam and system. The interrogatory is said to go to the question of reliance and it is clear that the applicant, as part of its case, contends that it was a term of the first respondent's retainer that it would make reasonable enquiries of the relevant statutory undertakings and in para. 7 of the defence the first respondent alleges that it relied entirely on the applicant to inform the respondents of any approvals of any statutory undertakings. So far as interrogatories 1.1 through to 1.7 are concerned, I am satisfied that those interrogatories, subject to one matter, do go to an important issue in the case and can properly be the subject of leave. The matter which does require attention, is the unlimited time span to which the interrogatory is addressed, beginning with the words "State whether the applicant made any enquiries to the Water Authority of Western Australia...". It seems to me that subject to the confinement of that inquiry to the period prior to, or during the time at which the first respondent was engaged by the applicant, the ye eee pose 7. interrogatories are reasonable. I would therefore be prepared to grant leave to interrogate in terms of 1.1 through to 1.7, provided that 1.1 be amended to read as follows:-— "State whether before or during the time in which the First Respondent was engaged by the applicant ...". As to interrogatory 1.8, that asks whether the applicant communicated the outcome of its enquiries to the respondents. That is a matter which is within the knowledge of the respondents and does not substantially expedite the disposition of the case, albeit the respondents assert that they wish to get admissions. These are matters which can be dealt with as part of their own evidence and in cross examination if necessary. Interrogatory 2 This, under the heading "Financial Viability" enquires essentially whether the applicant made any assessments of the financial viability of the scheme and then breaks down into a number of sub~questions about such assessments, by whom and how they were made and whether they were communicated to the respondent. For the moment, I am unable to see what role any assessment made by the applicant of the financial viability of the scheme at any time plays, having regard to the issues as pleaded and I will decline leave to interrogate in terms of interrogatory 2. Interrogatory 3 survives only in respect of 3.1 and 3.2, the respondents having abandoned their pursuit of 3.3 to 3.6. These first two interrogatories under 3 enquire as to the extent 8. to which the scheme has been completed and if not fully completed, the details surrounding the reasons for non-completion and a statement of the stage that the scheme has' reached. Their drafting is not terribly felicitous. It is difficult to see how one can talk about an "extent of completion", the thing is either complete or it is not complete and also the reference to "full details surrounding the reasons for non-completion" would have perhaps been better expressed as "the reasons for non-completion". Objection is not taken onthe basis of the language of the interrogatory, but rather in terms of its relevance to the issues as presently pleaded and in that regard I might note that Mr Stone has foreshadowed the possibility of, although not committed himself to, an amendment based on the non-completion of the scheme. In my opinion however, the first two questions are relevant to matters raised under the heading of particulars of loss and damage and in particular the items in para.(b) relating to increased costs of construction, although I understand from Mr Stone that they relate to costs not incurred, but anticipated, at the time that the proceedings were instituted. Nevertheless, it seems to me, that the question of completion is relevant to that aspect and I will give leave to administer interrogatories in terms 3.1 and 3.2, although if the respondent would care to express them in somewhat more precise language it would probably be helpful. Turning to Interrogatory 4, that asks primarily whether or not the applicant has made an application for subdivision approval of the subject land. The interrogatory does not immediately appear to relate to any matter in issue. If it does, wees oleracea ater MC 9. it is in any event a matter of public record and I_ see no advantage to be derived from administering interrogatories on a matter which can be proven by the production of certified copies of the appropriate approvals from the State Planning Commission. As to interrogatory 4.4, the question of whether the applicant communicated the approval and attached conditions of the scheme to the respondents, is a matter plainly within the knowledge of the respondents and again, I do not think the case is advanced by interrogating on that issue. I decline leave to interrogate in terms of interrogatory 4. As to Interrogatory , under the heading "Costs" this interrogatory relates to the various estimates said to have been given by the first respondent to the applicant as set out in paras. 10(b) to (g) of the statement of claim. The interrogatory asks whether each represented cost was broken down by reference to item and item costs. At least that is the thrust of interrogatories 5.1 to 5.14. Counsel for the first respondent indicates that the purpose of this interrogatory is to obtain admissions which will demonstrate that the applicant received the estimates in a form which must have made it apparent that the estimates were not those of the first respondent, but originated, as pleaded, with officers of the Water Authority. Again, these are matters well within the knowledge of the first respondent. I am not satisfied that the case will be advanced by interrogating as to them and I decline leave in respect of interrogatories 5.1 to 5.14. Interrogatory 5.15 is plainly a request for particulars and in the ordinary course a request for particulars is not we ey 10. granted unless special circumstances are made out. In that connection I refer to Conde v 2KY Broadcasters Pty Ltd (1982) 2 NSWLR 221. So far as interrogatory 5.16 is concerned, it was not pressed. It relates to the question whether the negotiations referred to in para. 12.(i)(b) of the statement of claim, as part of the element of delay said to flow from the first respondent's conduct, resulted in any concluded agreement with the Water Authority and at the moment I am not persuaded that it will assist the expeditious hearing of the case. I decline leave to administer interrogatory 5.16. Interrogatory 6 concerns a document which is annexed to the interrogatories and entitled "Quininup Tourist Complex Report". It appears to be a report prepared by or for the applicant relating to the development which is the subject of these proceedings. It is appropriate to allow the interrogatories in so far as they seek identification of the report, its authorship and the date upon which it came into existence. Its distribution can also be properly sought, as well as a statement of its purpose. I give leave to interrogate in terms of interrogatories 6.1 to 6.3. The detailed cross examination that follows on particular elements of the report is not, in my opinion, warranted by the benefit to be derived, having regard to the fact that they are matters which might well be put in cross examination. The essential question is as to authorship, time of production and purpose. I will give leave to interrogate in terms of 6.1 through to 6.3 inclusive but decline leave in respect of the balance of those interrogatories. --r ae eee ee [ ements aa -— ae 11. The orders I propose to make are as follows:-— Leave to the respondents to interrogate in terms of interrogatories 1.1 as amended, 1.2 to 1.7 inclusive, 3.1, 3.2, 6.1, 6.2 and 6.3. A new notice of these interrogatories to be filed and delivered on or before 19 August 1988. The applicant is to file and deliver answers on or before 2 September 1988. Costs today in the cause. The directions hearing will be adjourned to 9 amon 14 September. I certify that this and the preceding ten (10) pages are a true copy of the Ex tempore Reasons for Judgment of his Honour Justice French. Date: /7 y SS wee ee 7 ty A Counsel for the applicant: 12. Mr D. Stone Solicitors for the applicant: Northmore Hale Davy & Leake Counsel for the respondent: Miss L. Howell Solicitors for the respondent: Phillips Fox Date of Hearing: 12 August 1988 Date of Judgment: 12 August 1988