New South Wales Supreme Court CITATION : Wilson & ors v The State of New South Wales [2001] NSWSC 1165 FILE NUMBER(S) : SC 20218/99 HEARING DATE(S) : 23/11/01; 6/12/01 JUDGMENT DATE : 14 December 2001 PARTIES : Anthony James Wilson & Ors State of New South Wales JUDGMENT OF : O'Keefe J COUNSEL : Mr D R Campbell/Mr A S Kostopolous - Plaintiffs Mr C F Hodgson - Defendant SOLICITORS : Greg Walsh & Co, Chester Hill - Plaintiffs IV Knight, Crown Solicitors, Sydney - Defendant CATCHWORDS : Amendment - New cause of action based on essentially same facts - Prejudice - Effect of dismissal of first action - Stay of second action on essentially similar facts until costs for first action paid - Estoppel - traditional and Anshun - Relative financial positions of parties LEGISLATION CITED : Supreme Court Act 1970, ss 23, 63 Supreme Court Rules, Part 20, rule 1 Port of Melbourne Authority v Anshun (1980-1981) 147 CLR 589 Macquarie Bank v National Mutual Life Association of Australia (1996) 40 NSWLR 543 CASES CITED : Bowen v Hickey (1961) 78 WN (NSW) 820 Rice v Henley (1915) 32 WN (NSW) 54 Wilson & ors v State of New South Wales [2001] NSWSC 869, unreported, 28 September 2001 DECISION : 1. The amended Statement of Claim of 19 April 2001 is struck out; 2. Leave is given to the plaintiffs to amend their Statement of Claim so as to claim on the causes of action of malicious prosecution and abuse of process generally in the form set out in the document filed in Court, initialled by me and dated 6 December 2001, a copy of which has been placed with the papers; 3. The costs of the application to amend so as to claim on the bases referred to in Order 2 (above) are to be the defendant's costs in the action; 4. The plaintiffs are to pay the costs of the application to strike out the Statement of Claim and the amendments thereto, up to and including the amendment effected on 19 April 2001; 5. Order under Part 52A, Rule 9 for the payment of the costs referred to in Order 4 (above) before the conclusion of the proceedings refused. - 8 - SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION O'KEEFE J Date : 14 December 2001 20218/99 - ANTHONY JAMES WILSON & ORS v STATE OF NEW SOUTH WALES JUDGMENT HIS HONOUR: INTRODUCTION 1 On 28 September 2001, I delivered judgment on the substantive issues argued in this action (the principal proceedings). In it I concluded that there was no cause of action in negligence in any of the plaintiffs against the State of New South Wales in respect of actions taken by officers of the New South Wales Police Service in investigating, prosecuting and continuing the prosecution of the plaintiffs in respect of offences alleged to have been committed by them against certain named children who were either the offspring or grandchildren of the plaintiffs. It was also determined that none of the plaintiffs had a cause of action in negligence against the State of New South Wales in respect of the actions of the Director General or officers of the Department of Community Services (DOCS) arising out of care proceedings instituted in respect of the children or grandchildren of the plaintiffs. 2 After the judgment had been delivered, the principal proceedings were adjourned to a date to be fixed in order to enable the parties to argue the precise form of relief which should be granted in the light of the published reasons. 3 During the hearing of the principal proceedings, Senior Counsel who then appeared for the plaintiffs informed the Court that the amendments effected to the Statement of Claim on 19 April 2001 were the final amendments that would be sought and that in the event that the Court found in favour of the defendants on the claims as then framed, no application for further amendment would be made (see paras 19 and 22 of Judgment of 28 September 2001). However, when the matter came before the Court for the making of a final order, the plaintiffs, though their then counsel Mr David Campbell, sought a further amendment of the Statement of Claim and argued that the Court should not dismiss the action generally pursuant to Part 13, Rule 5. 4 The amendment then sought by the plaintiffs did not involve any claim based in negligence. This was essentially because, since the date on which I delivered judgment in the principal proceedings, the High Court had published its judgments in Sullivan v Moody; Thompson v Connon [2001] HCA 59, unreported, 11 October 2001. The effect of such judgments was to confirm the conclusion at which I had arrived in relation to the officers of DOCS. However, the judgments of the High Court did not deal with the situation of police officers, whose actions had been the subject of consideration in the judgment of 28 September 2001. 5 The new Statement of Claim proffered on behalf of the plaintiffs sought no relief against the State of New South Wales in respect of the actions of the Director General or officers of DOCS. The relief sought was based solely on the actions of the police officers who had been named in the principal proceedings and who were responsible for investigating, instituting and continuing the prosecution of the plaintiffs before a Magistrate. After a hearing, these proceedings had been dismissed by the Magistrate as against all plaintiffs, save that the first plaintiff, although discharged on all but one charge, was committed for trial on such one remaining charge. That charge was subsequently withdrawn, as the Director of Public Prosecutions declined to prosecute. 6 The causes of action asserted in the new Statement of Claim are malicious prosecution and abuse of process. Whilst these causes of action are essentially different in character from that argued in the principal proceedings, the facts out of which they arise are not different in their essence from those asserted in the principal proceedings in relation to the police officers. Furthermore, in the reasons given on 28 September 2001, the tort of malicious prosecution and cognate torts were adverted to as not being displaced by the tort of negligence in the fields of discourse the subject of such reasons. 7 The Supreme Court Act 1970 (the Act) confers on the Court all jurisdiction which may be necessary for the administration of justice in New South Wales (s 23). One objective of the Act is to ensure, as far as possible, that all matters in controversy between parties should be completely and finally determined so as to avoid multiplicity of legal proceedings (s 63). Appurtenant to this power is the wide power to allow amendments that is conferred by the Rules. Part 20, Rule 1, expressly empowers the Court "at any stage of any proceedings" to amend any document (r 1(1)). Part 20, Rule 1(2) provides: "All necessary amendments shall be made for the purpose of determining the real questions raised by or otherwise depending on the proceedings, or of correcting any defect or error in any proceedings, or of avoiding multiplicity of proceedings." (emphasis added) 8 The form of this provision mandates the avoidance of a multiplicity of proceedings, and is directed at ensuring that the real matters in issue are ventilated in the one action. Whilst the provision confers a discretion on the Court, that discretion is to be exercised in accordance with concepts of justice being done between the parties. Although an amendment will normally be allowed, this will not be so if a party has acted male fide or if there is other prejudice which may be occasioned by the allowing of the amendment. 9 In the present case, the proposed pleading asserts facts which are in essence those asserted previously in the various forms of the Statement of Claim up to and including that of 19 April 2001. The defendant is not faced with any factual assertion of which it was previously unaware. Furthermore, the ambit of the action as now proposed is more limited than which was the subject of the judgment of 28 September 2001. The causes of action are directed at the actions of the same police officers previously referred to, but no longer at the Director General or officers of DOCS. Furthermore, the causes of action are in standard or traditional form: namely, malicious prosecution and abuse of process. No difficult question of law appears to be thrown up by the Statement of Claim as now proposed. The issues will be essentially factual. 10 The plaintiffs claim that the State of New South Wales (the defendant) would not be prejudiced were the proposed amendment to be allowed. They assert that the defendant is fully apprised of the factual material on which the proposed causes of action are based, and has had every opportunity to research the facts, take statements and prepare to meet the factual allegations for many years; certainly since the original Statement of Claim was filed in April 1999. Furthermore, they argue that if their existing action were to be dismissed rather than amended, they would still be able to commence another action based on malicious prosecution and abuse of process because such actions were not yet statute barred; therefore there is no prejudice to the defendant. 11 The defendant opposed the amendment and raised four arguments against its allowance. 12 The first is that the "spectre" of another action is itself a form of prejudice to it. This submission does not carry any real weight. If the action were to be dismissed the so called spectre of another action would still be there, because the plaintiffs are not yet out of time to commence another action. The spectre asserted by the defendant is thus not in substance different from the one which may exist if the amendment were not to be allowed. The only difference is one of timing. If the amendment were to be allowed, the spectre would become a reality immediately; if not, it would remain a spectre for a short time and then become a reality when the new action was commenced. 13 The defendant's second argument was based on the course which the principal proceedings took. It was submitted that the principal proceedings had taken a particular course, that Senior Counsel had advised the Court that the plaintiffs would not seek any further amendment after that effected on 19 April 2001, and that as a consequence it would be inappropriate in the circumstances to allow a further amendment. Whilst I can understand the chagrin of the defendant that it should be met with what might well be seen as an effective amendment at this late stage, the fact is that even if such amendment had been proffered as at 19 April 2001, the argument as to whether or not a cause of action in negligence existed would still have taken place. A decision by the Court would still have been necessary and in the light of the decision given on 28 September 2001, that part of the Statement of Claim concerned with negligence would have been struck out, leaving the causes of action in malicious prosecution and abuse of process extant. To allow the amendment at this stage will do no more than give rise to exactly the same situation. As a consequence, this ground of prejudice claimed on behalf of the defendant is not real. 14 The defendant then advanced the argument that, if the existing action were to be dismissed, the plaintiffs would not be prejudiced because it would be open to them to commence another action. In support of this, counsel for the defendant obtained instructions about the concern expressed by the plaintiffs that were they to have their action dismissed, they may be met with a claim of estoppel, whether of the traditional kind or of the Anshun kind. (Port of Melboune Authority v Anshun (1980-1981) 147 CLR 589). Having done so, counsel for the defendant informed the Court that: "Instructions have been obtained from the defendant that, if the Court is minded to allow the amendment, the defendant would not, were proceedings to be commenced by the plaintiffs for malicious prosecution and/or abuse of process in relation to the prosecution of the criminal charges referred to in paragraph 21 of the proposed further Amended Statement of Claim, raise any objection to any such claim, either by way of an allegation that the proceedings are an abuse of process because of the fact of the earlier proceedings and/or a claim that an Anshun estoppel exists, because of the earlier proceedings, which preclude such further proceedings." 15 Whilst such undertaking would undoubtedly be a comfort to the plaintiffs, it should be remembered that in Macquarie Bank v National Mutual Life Association of Australia (1996) 40 NSWLR 543, Powell JA expressed the view that: "In a case in which a party has sought, but has been refused, leave to raise a matter in earlier proceedings, it can hardly be said that through negligence, inadvertence or even accident, he has allowed the point to pass by and ought not thereafter be allowed to seek to raise the matter; rather, as it seems to me, the fact that leave was sought but refused, would constitute special circumstances which would require the Court to permit the matter to be raised in the second proceedings." (at 619) 16 However, the view expressed by Powell JA was not shared by Priestly JA. He expressly disagreed with Powell JA, "on the cause of action estoppel point" (supra at 546), preferring the analysis of Clarke JA on that point. Thus, the matter is not without doubt and the form of undertaking given by the defendant may be strictly applied by the defendant and strictly construed by a court. In these circumstances, there is the potential for prejudice which would not exist were the amendment to be allowed. 17 The final matter of prejudice raised on behalf of the defendant related to costs. It was submitted that if the plaintiffs were permitted to amend, the order made would be interlocutory in character and any costs ordered in favour of the defendant would not, without special order, be permitted to be assessed and recovered until the action had been concluded. If the action were dismissed, so the argument ran, the defendant would not be held out of its costs, but to allow the amendment would give rise to the prejudice of having to wait for its costs. In the alternative, it sought an order that any costs to be ordered against the plaintiffs should be presently payable and not have to await the conclusion of the action. There is a power to make such an order conferred by Part 52A, Rule 9. 18 Against this, the plaintiffs argued that if the principal action were to be dismissed and they were to be left to commence a second action, the defendant in such action would be able to apply for a stay until the costs of the principal action had been paid. Bowen v Hickey (1961) 78 WN (NSW) 820 supports this proposition, as does the judgement of Harvey J in Rice v Henley (1915) 32 WN (NSW) 54. Furthermore, were the principal action to be dismissed, the defendant would be able to tax its costs and execute its judgment for costs against the plaintiffs. 19 Evidence was called on behalf of the plaintiffs, and was not challenged by the defendant, that the third plaintiff was an 80 year old pensioner; the first and second plaintiffs unemployed pensioners. They all live in a home which is modest in nature and decrepit as far as maintenance is concerned. That evidence indicated that because the defendant had advised the employer of the second plaintiff of the proceedings pending against her, she lost her job and had not been able to obtain employment since. The first plaintiff, who had worked for the Government Railways for the bulk of his working life, had to retire. He has spent the whole of his superannuation on the proceedings to date, and has only been able to maintain the action in this Court as a result of the pro bono work by his solicitor and counsel. For the plaintiffs, the costs of the action would be likely to be a high, perhaps an insuperable, barrier to the commencement of a second action. 20 On the other hand, the amount of costs involved is small in relation to the budget of the State of New South Wales; even to the budget of the New South Wales Police Service. Being held out of such costs would not, in my opinion, impose hardship of any significant kind on the defendant. 21 On balance, it is clear that the dismissal of the action would occasion serious hardship and prejudice for the plaintiffs and scarcely any, and certainly no significant, hardship on the defendant. 22 Having regard to the relative prejudices, to the provisions of Part 20, Rule 1(2) and the direction it contains to avoid multiplicity of proceedings, and in the light of the policy enshrined in the provisions of the Act referred to above, I am of opinion that the amendments sought by the plaintiffs should be allowed, and that the costs of, and incidental to, the amendment should be the defendant's costs in the action. 23 As far as the costs of the argument on the claim in negligence made in the principal proceedings are concerned, I am of opinion they should be borne by the plaintiffs. However, such costs should not be the subject of any special order as to time of recovery, rather the payment of such costs should abide the outcome of the action in its amended form. Orders 1. The amended Statement of Claim of 19 April 2001 is struck out. 2. Leave is given to the plaintiffs to amend their Statement of Claim so as to claim on the causes of action of malicious prosecution and abuse of process generally in the form set out in the document filed in Court, initialled by me and dated 6 December 2001, a copy of which has been placed with the papers. 3. The costs of the application to amend so as to claim on the bases referred to in Order 2 (above), are to be the defendant's costs in the action. 4. The plaintiffs are to pay the costs of the application to strike out the Statement of Claim and the amendments thereto up to and including the amendment effected on 19 April 2001. 5. Order under Part 52A, Rule 9 for the payment of the costs referred to in Order 4 (above) before the conclusion of the proceedings refused. ********* Last Modified: 12/17/2001 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.