Shire of Frankston and Hastings v Cohen [1960] HCA 6

High Court of Australia Dixon C.J. McTiernan, Fullagar, Menzies and Windeyer JJ. Shire of Frankston and Hastings v Cohen [1960] HCA 6

ORDER Appeal allowed with costs. Order of Smith J. discharged. In lieu thereof order that the summons be dismissed with costs.

Cur. adv. vult.

The following written judgments were delivered:—

1960, Feb. 23 Dixon C.J.

In my opinion this appeal should be allowed. I have had the advantage of reading the reasons of Fullagar J. and I agree in them.

McTiernan J.

In my opinion the reasons and judgment of Smith J. are right. I do not think it is necessary to add anything to them and consequently I think that the appeal should be dismissed.

Fullagar J.

This case comes from the Supreme Court of Victoria, and is an appeal by leave against an order made by Smith J. in chambers.

The Shire of Frankston and Hastings brought an action against the Commercial Bank of Australia Ltd. and two individual defendants, named respectively Lamb and Cohen. So far as the Bank and Lamb are concerned, a settlement was reached before Smith J. made his order, and that order affects only the present respondent Cohen. The statement of claim alleges against Cohen that, having been appointed under the Local Government Act 1946 as auditor of the accounts of the plaintiff municipality, he so negligently conducted the audit that an officer of the council of the municipality, a man named Stanes, was enabled to misappropriate large sums of money over a period. Voluminous particulars of the alleged negligent conduct of the audit were delivered with the statement of claim, and the amount claimed by way of damages against Cohen is £10,956 10s. 5d. Before a defence was delivered Cohen issued a summons asking (inter alia) that those paragraphs of the statement of claim which applied to him should be struck out on the ground that they disclosed no reasonable cause of action. In the normal course of things this summons must have been dismissed, because it was clear that the statement of claim disclosed at least an arguable case, and it is well settled that an order of the kind sought, which would have the practical effect of disposing summarily of an action, should not be made unless it is quite clear that the plaintiff cannot succeed: see Dey v. Victorian Railways Commissioners [1] per Dixon J. [2] . However, the plaintiff joined with the defendant Cohen in asking Smith J. to determine finally the question raised by the summons on the pleading. That question, to use his Honour's words, is whether the bare facts that the defendant Cohen is a municipal auditor with a certificate of competency, that he has been duly appointed by the Governor in Council under the Act to be auditor for a municipality, and that he, in consequence, conducts an audit of its accounts, are sufficient to place him under a duty to the municipality to use care and skill in auditing the accounts.