New South Wales Supreme Court CITATION : McMurtrie v Commonwealth of Australia & Ors [2000] NSWSC 1056 CURRENT JURISDICTION: Common Law FILE NUMBER(S) : SC 20448/99 HEARING DATE(S) : 24 October 2000 JUDGMENT DATE : 16 November 2000 Mark McMurtrie (Plaintiff) Commonwealth of Australia (First Defendant) The Aboriginal & Torres Strait Islander Commission (Second Defendant) Dumaresq Shire Council (Third Defendant) PARTIES : NSW Police Service (Fourth Defendant) Australian Taxation Office (Fifth Defendant) Independent Commissioner Against Corruption (Sixth Defendant) NSW Police Commissioner Ryan (Seventh Defendant) JUDGMENT OF : Master Harrison COUNSEL : Mr Sheldon (Third Defendant) Mr M McMurtrie (Plaintiff in person) SOLICITORS : Mr G Kathner (Second Defendant) CATCHWORDS : Set aside default judgment - summary judgment Supreme Court Rules - Part 15 r 26; Part 13 r 5; s 40 r 9(2) Trade Practices Act LEGISLATION CITED : Aboriginal & Torres Strait Islander Commissioner Act 1989 Local Government Act 1993 Halbury's Laws of Australia (1999) Reed International Books t/as Butterworths Evans v Bartland (1937) AC 473 Vacuum Oil Pty Limited v Stockdale (1942) 42 SR 239 Cuttle v Brand (1947) 64 WN 96 Adams v Kennick Trading (International) Ltrd & Ors (1986) 4 NSWLR 503 Cohen v McWilliam (1995) 39 NSWLR 476 H 1976 Nominees Pty Limited v Galli Ltd & Quaries Ltd (1979) 30 ALR 181 Garcia v National Australia Bank Limited (1998) CLR 395; (1998) 72 ALJR 1243 Commercial Bank of Australia v Amadio (1983) 151 CLR 447 Blomley v Ryan (1956) 99 CLR 362 CASES CITED : National Management Services (Australia) v Commonwealth (1990) BCL 190 J S McMillan Pty Ltd v Commonwealth (1997) 77 FCR 337 Corrections Corporation of Australia Pty Ltd v Commonwealth [2000] FCA 1280 Sovar v Henry Lane Pty Limited (1966-67) 116 CLR 397 Stubbs v NRMA Insurance Ltd [1997] 42 NSWLR 550 Onus v Alcoa of Australia Limited (1981) 149 CLR 27 Prestion v Star City Pty Ltd [1999] NSWSC 1273 United States Surgical Corporation v Hospital Products International Pty Ltd [1982] 2 NSWLR 766 Uren v John Fairfax & Sons Pty Ltd (1996) 117 CLR 118 Collings Constructions Co Pty Ltd & Anor v ACCC [1998] 43 NSWLR 131 Kralje & Anor v McGrath & Anor [1986] 1 All ER 54 DECISION : See para 61 31 THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION MASTER HARRISON THURSDAY, 16 NOVEMBER 2000 20448/99 - MARK McMURTRIE v COMMONWEALTH OF AUSTRALIA & 6 ORS JUDGMENT (Set aside default judgment; Summary judgment) 1 MASTER: By notice of motion filed 22 August 2000 the second defendant, The Aboriginal and Torres Strait Islander Commission (ATSIC) seeks firstly, that default judgment dated 28 February 2000 be set aside; and secondly that the proceedings be stayed or dismissed pursuant to Part 13 r 5 of the Supreme Court Rules (SCR) or alternatively that the pleadings be struck out, so far as they relate to the second defendant (ATSIC), pursuant to Part 15 r 26 SCR. The second defendant relied on the affidavit of Gregory George Kathner sworn 4 October 2000. The plaintiff relied on his affidavit sworn 17 October 2000. 2 By notice of motion filed 14 July 2000 the third defendant, Dumaresq Shire Council, seeks that the proceedings against it be dismissed pursuant to Part 13 r 5 of the SCR or alternatively that the statement of claim be struck out pursuant to Part 15 r 26. The third defendant relied on the affidavits of Simon Patrick Wilson sworn 14 July 2000 and John Hadfield sworn 28 July 2000 and 23 October 2000. The plaintiff relied on his affidavits both sworn 23 October 2000 and that of Manuel Ritchie sworn 12 October 2000. 3 On 28 August 2000 I delivered judgment in relation to a summary judgment application by the first, fourth, fifth, sixth and seventh defendants. The statement of claim was struck out against those defendants. The plaintiff was granted leave to file an amended statement of claim on or before 18 October, 2000 as against those defendants. On 17 October 2000 the plaintiff filed an amended statement of claim. The plaintiff purportedly amended the claim in accordance with the above order. However he amended the claim against the second and third defendant even though he had not been granted leave to do so. The plaintiff would, had the proper course been adopted, been entitled to make these amendments provided that they were not considered to be futile. The second and third defendants submitted that the plaintiff would not have been granted such leave as the amendments are futile. The plaintiff consents to the case against the first defendant (Commonwealth of Australia) and fifth defendant (Australian Taxation Office) being dismissed. Accordingly I make those orders. 4 In my earlier judgment I set out a briefly the allegations made by the plaintiff against the second and third defendants. They are: 5 In 1992 the plaintiff was awarded a management traineeship from the Department of Employment and Education and Training (DEFT). DEET Lismore branch gave an undertaking that it would support the plaintiff for training management funds for a period of four years. In mid 1992 the responsibility for the management funds was transferred to the Aboriginal and Torres Strait Islander Commission (ATSIC). However, the arrangement entered into between the plaintiff and DEET was considered by ATSIC not to fall within their program guidelines. 6 In 1993 a recommendation was made that it was up to the regional office of ATSIC to negotiate to appropriate conditions of the grant, project milestones and accountability arrangements with the plaintiff so that the intended aims of the project were achieved. A continuation of the grant of assistance depended upon those conditions being met. It was suggested that the conditions of the grant should include reference to the original DEET conditions. 7 The plaintiff negotiated a lease with Dumaresq Shire Council to lease some land at Armidale airport. The plaintiff borrowed the sum of $150,000 from the Council and erected a hangar on the land. The plaintiff employed eight others and he conducted a business known as New England Aircraft Refinishers. The plaintiff had deposed that he only signed the back page of the deed and the lease, but did not witness the lease nor date it nor sign every page. He did this, he says, so it could not later be held that the lease was validly entered into. The plaintiff disputes that he entered into this lease and this forms part of the claim against the third defendant. He had pleaded that he entered into a verbal agreement with Mr Tydd who was employed by the third defendant. According to the plaintiff, the written lease differed from that agreement, in that the lease was verbally agreed to be for 20 years with a 20 years option and rental was to be calculated at $2.00 per square metre not $2.15. The plaintiff asserts that two days before the grand opening of his business, at which potential clients and dignitaries were due to attend, the Council members coerced he an his wife to sign the lease with the threat that the grand opening would not take place. 8 Towards the end of 1995 the Civil Aviation Safety Authority (CASA) shut the plaintiff's business down. Regrettably it appears that CASA made an error which they later admitted and settled the matter with the plaintiff. There is a note from the Commonwealth and Defence Force Ombudsman records that the outcome was substantially favourable to the plaintiff. Unfortunately being shut down by CASA for a period of time affected the cash flow and reputation of the business. After ATSIC took over responsibility of the training program from DEET, the plaintiff had difficulties being paid. This meant that the plaintiff could not make his repayments of the lease to the Council. 9 On 30 January 1996, the Council's solicitors wrote to the plaintiff stating that as lessee of the Council's property situated at Armidale airport he was in arrears of rental and in default in relation to the terms of the deed of agreement entered into with the Council in December 1993. The solicitors were instructed that the Council had resolved that proceedings should be commenced for possession of the subject premises and recovery of arrears of rent, and also arrears of payment due pursuant to the deed of agreement. The letter concluded that the solicitors were writing to advise that upon receipt of further instructions the necessary initiating process would be prepared and filed with the Supreme Court and thereafter served on the plaintiff. The plaintiff says that he wanted the matter to come before the court, so was quite content for that course of action to occur. 10 In a letter dated 9 February 1996 the Council's solicitor says that the plaintiff abandoned the premises and that the Council accepts the repudiation of any agreement which may have been in existence. It says that the Council had re-entered the premises and taken possession of the same, and that the locks on the doors to all premises had been changed. It further said that any agreement that may have been in existence between the plaintiff and the Council was terminated and the plaintiff was now excluded from the premises. An inventory of the equipment that was in the office, hangar, bathroom and outside was listed. Advice was given that these possessions could be recovered by contacting a member of the Council. 11 The plaintiff alleges that the Council officers together with the police took possession of the property without lawful reason. The plaintiff says that once he found out that the Council had sought to take possession of the property he reported the break and enter to the police, but no action was taken. As the plaintiff considered that the Council was not entitled to take possession he reported the actions of the police and the Council to the Independent Commission Against Corruption (ICAC) (sixth defendant). 12 The first issue for consideration is whether the default judgment entered against the second defendant should be set aside. The law in relation to default judgment 13 The relevant part of s 40 r 9(2) of the SCR provides: "(2) The Court may set aside or vary a judgment - (b) where the judgment has been entered after judgment has been given in the absence of a party, whether or not the absent party had notice of trial or of any motion for the judgment." 14 The authorities on setting aside default judgement are Evans v Bartlam (1937) AC 473 at 489; Vacuum Oil Pty Limited v Stockdale (1942) 42 SR 239; Cuttle v Brand (1947) 64 WN 96 at 97; and Adams v Kennick Trading (International) Ltd & Ors (1986) 4 NSWLR 503. 15 A consideration to be taken into account when determining whether default judgment should be set aside was expressed by Priestley JA in Cohen v McWilliam (1995) 39 NSWLR 476 at 481: "It is, however, another question whether concern about the extent of delays, either in a particular case or generally, should, in the absence of prejudice in the particular case, be taken into account in exercising a discretion to set aside default judgment. The fundamental duty of the court is to do justice between the parties. It is, in turn, fundamental to that duty that the parties should each be allowed a proper opportunity to put their cases upon the merits of the matter. Any limitation upon that opportunity will generally be justified only on the necessity to avoid prejudice to the interests of some other party, occasioned by misconduct." 16 For the second defendant to succeed in its application to set aside default judgment it must give an adequate explanation for the delay in filing its defence and show that it has a defence on its merits, or as often expressed a bona fide defence. However, as Priestley JA said in Cohen that it is a fundamental duty of the court to do justice between the parties. 17 The facts giving rise to the obtaining of default judgment are as follows: (1) On 7 October 1999 the statement of claim was filed and served upon the second defendant. (2) Between 26 October 1999 and 28 October 1999 the second defendant made numerous telephone calls to a legal officer at ATSIC, Ms Littlewood regarding the filing of a defence. (3) On 6 January 2000 Mr Gregory Kathner from the Australian Government Solicitors, the solicitor acting on behalf of the first, second and fifth defendant had a lengthy telephone conversation with the plaintiff. (4) On 6 January Mr Kathner filed a notice of appearance on behalf of the second defendant. (5) On 12 January 2000 Mr Kathner wrote to the plaintiff referring to their telephone conversation of 6 January 2000. He confirmed he had instructions to act for the second defendant. He told the plaintiff that he had sought access to all relevant files held by his client ATSIC in relation to the matters raised in the statement of claim and hoped to be in a position to review that documentation. (6) On 14 January 2000 Mr Kathner had a telephone conversation with Ms Littlewood of the second defendant's office, who indicated to him that she was making strenuous efforts to locate all relevant documentation in relation to the plaintiff. (7) On 15 January 2000 Mr Kathner departed for the United States of America for the purposes of taking evidence on commission for proceedings in the District Court. He returned to Australia on 27 January 2000. (8) On 2 February 2000 Mr Kathner commenced a review of the files provided to him by the second defendant and discussed this matter with Ms S Trevina. (9) On 7 February 2000 Mr Kathner had a telephone conversation with the plaintiff and indicated to him that he (Mr Kathner) had recently received a substantial amount of material from the second defendant and was in the process of reviewing it. Mr Kathner concedes that the plaintiff told him that he would enter default judgment. (10) On 28 February 2000 default judgment was entered that the second defendant is liable to the plaintiff for damages to be assessed. The second defendant was not advised that default judgment had been entered. (11) In May 2000 Mr Kathner filed a notice of motion seeking summary judgment on behalf of the first to fifth defendant for whom he also acted. (12) On 2 August 2000 the second defendant's solicitor was advised at court that default judgment had actually been entered against the second defendant although he conceded that the plaintiff had mentioned it in several of his telephone conversations with him. (13) On 3 August 2000 the plaintiff wrote to Mr Kathner and forwarded a copy the default judgement against the second defendant. (14) On 22 August 2000 the motion to set aside default judgment was filed. 18 It appears that the second defendant was having understandable difficulties pleading to the statement of claim. The second defendant's solicitor, Mr Kathner attempted to clarify matters with the plaintiff. Although the plaintiff obtained default judgment in February 2000 he did not advise the second defendant's solicitor of this nor did he service a copy of it on the second defendant's solicitor. Nevertheless, a defence was not filed on behalf of the second defendant within the prescribed period of 14 days. Nor did the second defendant formally ask the plaintiff for an extension of time to file a defence. From May 2000 there were strike out proceedings on foot by other defendants, some of whom were represented by the same solicitor as represented the second defendant. Once the second defendant became aware of the existence of the default judgment it acted expeditiously to have it set aside. The case is in its early stages of preparation and once the statement of claim clarifies what the case is against the second defendant, I am of the view it will most likely have a bona fide defence. 19 The plaintiff will not be prejudiced by the setting aside of the default judgment. The second defendant should be entitled to have its case heard on its merits. Accordingly, I set aside the default judgment entered 28 February 2000. Summary judgment 20 At the outset, I remind myself that the onus is on the plaintiff in the statement of claim to set out the facts upon which the defendants can become aware of the precise allegations made against them and hence what it is that they have to meet. If a fact is material, it must be pleaded and not merely referred to in particulars - see H 1976 Nominees Pty Limited v Galli Ltd & Quarries Ltd (1979) 30 ALR 181 at 186-187. It is not necessary to reproduce the law in relation to summary judgment as this was reproduced in my earlier judgment. 21 The amended statement of claim as against the second defendant pleads: "4. In 1992 the Plaintiff was awarded a Management Traineeship from the (then) Department of Employment, Education and Training (DEET), which was a four year contract with DEET. 5. The Plaintiffs contract with DEET was usurped by ATSIC in mid to late 1992. 6. Upon taking control of the Plaintiffs contract, ATSIC attempted to have the Plaintiff comply with ATSIC policies and procedures. 7. The Plaintiff was made aware that ATSIC had taken over authority of his contract some time in late 1992. 8. The Plaintiff was not informed, nor given an option as to whether or not his contract was transferred to ATSIC prior to the transfer." 22 The statement of claim then continues with a narrative of conversations and events that occurred between the plaintiff and second defendant, some of which need not be pleaded. The particulars of negligence as against the second defendant are pleaded at paragraphs 79 to 85 of the statement of claim. They are - "79. Particulars of negligence of the Defendant - ATSIC 80. breached the contract entered into by DEET with the Plaintiff, which contract ATSIC usurped control of in 1992. 81. breached Sections 51AA, 51AC and 60 of the Trade Practices Act 1974. 82. did not perform its' duties and functions with due and appropriate care of the Plaintiffs legal and other rights and entitlements pursuant to section 3(b), (c) and (d), section 7(d), (j), (k) & (o), section 8(1), and section 10 of the ATSIC Act 1989. 83. participated in unconscionable conduct in forcing its' breach of the DEET initiated contract upon the Plaintiff. 84. interfered with the Plaintiffs rights under section 94(1)(d),(e) and (g). 85. ATSIC staff failed in their respective duty(ies) under the requirements and provisions of the Australian Public Service Act, in particular sections: 10(1)a, c, d, e, g, 13(1), (2), (3), (4), (5), (9), (11), 13)." 23 The second defendant does not object to the breach of contract pleaded in paragraph 80 remaining on foot. Paragraphs 81 and 83 refer to unconscionable conduct and particular sections of the Trade Practices Act. Unconscionable conduct 24 Although Garcia v National Australia Bank Limited (1998) CLR 395; (1998) 72 ALJR 1243 involved the wife giving a guarantee in respect of a husband's business 1oans, unconscionable conduct is not limited to guarantees. In Commercial Bank of Australia v Amadio (1983) 151 CLR 447 which involved parents giving a mortgage and guarantee in respect of their son's business, Mason J at p 641 stated that, it goes without saying that it is impossible to describe definitively all the situations in which relief will be granted on the grounds of unconscionable conduct and gave as examples those discussed in Blomley v Ryan (1956) 99 CLR 362 at pp 405-415. Hence unconscionable conduct is a general principle not limited to guarantees. 25 The plaintiff asserts that the second defendant participated in unconscionable conduct in forcing its breach of DEET initiated contract upon the plaintiff. In court and from the bar table, the plaintiff has elaborated that the second defendant allegedly changed the ground rules in relation to training and other matters. It is difficult to say whether the plaintiff has a claim for unconscionable conduct but in any event the pleading in relation to unconscionable conduct needs to be repleaded. 26 The plaintiff has alleged at paragraph 81 of the amended statement of claim that the second defendant has breached s 51AA (unconscionable conduct), s 51 AC (unconscionable conduct in business transactions) and s 60 (harassment and coercion) of the TPA. On the face of the proceedings the events that gave rise to these proceedings occurred at the latest between 1992 and February 1996. The statement of claim was filed on 7 October 1999. The plaintiff has made claims under the Trade Practices Act (TPA). Section 82 of the TPA has a limitation period of 3 years after the accrual of a cause of action. Hence the claims currently pleaded under the TPA became statute barred in February 1999. These claims should be struck out. 27 The second defendant submitted that the Aboriginal and Torres Strait Islander Commission Act 1989 on any construction does not provide private rights for damages for alleged breaches of its "objects". Section 7 outlines the functions of the second defendant. Section 8 facilitates the administrative conferral of functions upon the second defendant and s 10 outlines the powers of the second defendant. 28 The objects of the Act are set out in s 5.3 which reads: "in recognition of the past dispossession and dispersal of the Aboriginal and Torres Strait Islander peoples and their present disadvantaged position in Australian society: (a) to ensure maximum participation of Aboriginal persons and Torres Strait Islanders in the formulation and implementation of government policies that affect them; (b) to promote the development of self-management and self-sufficiency among Aboriginal persons and Torres Strait Islanders; (c) to further the economic, social and cultural development of Aboriginal persons and Torres Strait Islanders: and (d) to ensure co-ordination in the formulation and implementation of policies affecting Aboriginal persons and Torres Strait Islanders by the Commonwealth State, Territory and local government, without detracting from the responsibilities of State, Territory and local governments to provide services to their Aboriginal and Torres Strait Islander residents." 29 The functions of the second defendant are set out in 5.7 to the Act and are: "(1) The Commission has the following functions: (a) to formulate and implement programs for Aboriginal persons and Torres Strait Islanders; (b) to monitor the effectiveness of programs for Aboriginal persons and Torres Strait Islanders, including programs conducted by bodies other than the Commission; (c) to develop policy proposals to meet national, State, Territory and regional needs and priorities of Aboriginal persons and Torres Strait Islanders; (d) to assist, advise and co-operate with Aboriginal and Torres Strait Islander communities, organisations and individuals at national, State, Territory and regional levels; (e) to advise the Minister on: (i) matters relating to Aboriginal and Torres Strait Islander affairs, including the administration of legislation; and (ii) the co-ordination of the activities of other Commonwealth bodies that affect Aboriginal persons or Torres Strait Islanders; (f) when requested by the Minister, to provide information or advice to the Minister on any matter specified by the Minister; (g) to take such reasonable action as it thinks necessary to protect Aboriginal and Torres Strait Islander cultural material and information, being material of information that is considered sacred or otherwise significant by Aboriginal persons or Torres Strait Islanders; (h) at the request or with the concurrence of the Australian Bureau of Statistics buy not otherwise, and without infringing the privacy of any individual, to collect and publish statistical information relating to Aboriginal persons and Torres Strait Islanders; (i) such other functions as are conferred on the Commission by this Act or any other Act; (j) such other functions as are conferred on the Commission by the Prime Minister by notices in force under section 8; (k) such other functions as are expressly conferred on the Commission by a law of a State or of an internal Territory and in respect of which there is in force written approval by the Minister under section 9; (l) to take such research as is necessary to enable it to perform any of its other functions; (m) to do anything else that is incidental or conducive to the performance of any of the preceding functions. (2) The information that may be required by the Minister under paragraph (1)(f) includes, but is not limited to, information about the Commission's expenditure. (3) The Minister is not empowered, when requesting information under paragraph (1)(f), to specify the content of the information that is to be provided. (4) In performing its function under paragraph (1)(g), the Commission shall ensure that material or information covered by that paragraph is not disclosed by the Commission if that disclosure would be inconsistent with the views or sensitivities of relevant Aboriginal persons or Torres Strait Islanders. (5) Nothing in this section or in any other provision of this Act shall be read as conferring on the Commission a function of acquiring land except: (a) for its administrative purposes; or (b) for the purpose of the performance of functions expressly conferred on the Commission by this Act." 30 Various functions can be conferred upon the second defendant by the Prime Minister which is outlined in s 8 of the Act. "(1) The Prime Minister may, for the purpose of furthering the social, economic or cultural development of Aboriginal persons or Torres Strait Islanders, confer a departmental function on the Commission. (2) The power under subsection (1) shall be exercised by notice published in the Gazette. (3) In this section departmental function means a function that has previously been performed by a Department of State of the Commonwealth." 31 The powers of the Commission are outlined in s 10 of the Act and are as follows: "(1) The Commission has power to do all things that are necessary or convenient to be done for or in connection with the performance of its functions. (2) The powers of the Commission under subsection (1) include, but are not limited to, the following powers: (a) to negotiate and co-operate with other Commonwealth bodies and with State, Territory and local government bodies; (b) to enter into an agreement for the making of a grant or loan under section 16 to: (i) a State; or (ii) the Australian Capital Territory; or (iii) the Northern Territory; or (iv) an authority of a State or a Territory (including a local government body). (c) to enter into an agreement other than an agreement referred to in paragraph (b)) with a State or Territory; (d) to accept gifts, grants, bequests and devises made to it; (e) to act as trustee of money and other property vested in it on trust. (3) The power of the Commission to enter into agreements of the kind referred to in paragraph (2)(c) shall not be exercised without the written approval of the Minister. (4) In spite of anything contained in this Act, any money or other property held by the Commission on trust shall be dealt with in accordance with the powers and duties of the Commission as trustee. (5) The powers of the Commission may be exercised within or outside Australia." 32 The objects and functions of the second defendant have been referred to above. These sections do not give rise to a private right to sue. I have referred to this topic in more detail later in this judgment. 33 Further, the second defendant submitted that firstly, ATSIC is not a commercial entity; and secondly, that it is not engaged in carrying on a business. Section 2A of the Trade Practices Act 1974 binds the Crown in right of the Commonwealth and each authority of the Commonwealth. Section 2A (2)(b) of the Act reads: "so far as the Crown in right of the Commonwealth carries on a business, either directly or by an authority of the Commonwealth" 34 The second defendant referred to National Management Services (Australia) v Commonwealth (1990) BCL 190; J S McMillan Pty Ltd v Commonwealth (1997) 77 FCR 337 at 356-357; and Corrections Corporation of Australia Pty Ltd v Commonwealth [2000] FCA 1280. 35 In National Management Services McLelland J in relation to the redevelopment of Cabinet offices in Phillip Street, Sydney said: "There is nothing to suggest that in relation to the development of the site the Commonwealth was engaged in a trading or commercial activity which could appropriately be characterised as carrying on a business". 36 In McMillan, Emmett J held that the sale by tender of the Australian Government Printing Service in 1996 not to be activity engaged in carrying on a business. 37 The matter was more recently addressed by Finkelstein J in Corrections Corporation. The issue was whether the request for tenders for the provision of detention and escort services constituted "carrying on a business". His Honour said: "The meaning that the word "business" is to bear, must be considered in the context in which it is used. Here that context is legislation that is, generally speaking, concerned with the conduct of trading corporations and financial corporations that compete in a market for the provision of goods and services, or that are engaged in trade or commerce or are otherwise involved in the provision of goods and services. Thus it is plain enough that the 'carrying on of a business' that will bring the Commonwealth under the Trade Practices Act is intended to refer to activities undertaken in a commercial enterprise or as a 'going concern'. Ordinarily, a commercial enterprise is one that the proprietor conducts with a view to a profit". 38 The second defendant submitted that by reference to its own enabling legislation it is neither engaged in trade or commerce nor conducting a business with a view to profit. The second defendants objects and operations are aimed at the development of the social, economic and cultural aspects of Aboriginal and Torres Strait Islander persons. The plaintiff submitted that ATSIC loans money for commercial activities and engages in commercial activity. However, this does not appear to be the case from the sections of the Act quoted above. As currently pleaded, these allegations are doomed to failure and should be dismissed. 39 The plaintiff alleges breaches of certain statutory duties in paragraphs 82, 84, 85, 89 and 90 of the amended statement of claim. Paragraphs 82 and 84 particularise breaches of the ATSIC Act. Those sections are clearly not ones which give the plaintiff a private right to sue. These paragraphs should be dismissed but the plaintiff should be given an opportunity to replead. However, there may be other statutory provisions which may give rise to a private right to sue. 40 In relation to paragraphs 85, 89 and 90 of the amended statement of claim whether the alleged breaches of statutory duty gives rise to a private right was discussed by the High Court in Sovar v Henry Lane Pty Limited (1966-67) 116 CLR 397 where Kitto J at 405 stated: "...The intention that such a private right shall exist is not ... conjured up by judges to give effect to their own ideas of policy and then imputed' to the legislature. The legitimate endeavour of the courts is to determine what inference really arises, on a balance of considerations, from the nature, which it is directed, the nature of the conduct prescribed, the pre-existing state of the law, and, generally, the whole range of circumstances relevant upon a question of statutory interpretation." 41 The above quote was cited with approval in Stubbs v NRMA Insurance Ltd [1997] 42 NSWLR 550 at 555. 42 The question of construction of the statute posed is not, however, answered by asking whether the enactment is for the protection of the public at large, or for the benefit of a class of persons of which the plaintiff is a member: see Onus v Alcoa of Australia Limited (1981) 149 CLR 27 at 67-68. It is my view that the submission that ss 3(b),(c),(d), 7(d), (j), (k) (o), 8(1) and 94(1)(d),(e) and (g) of the ATSIC Act give private rights to sue is untenable - see Preston v Star City Pty Ltd [1999] NSWSC 1273 at paragraphs 63 to 94. The Public Service allegations of breaches of statutory duties under the Public Service Act also fails. 43 The plaintiff at paragraph 83 in the amended statement of claim also asserts a breach of his rights under s 94(1)(d), (e) and (g) of the Aboriginal and Torres Strait Islander Commission Act 1989. This section deals with the functions of ATSIC Regional Councils. The second defendant submitted that no allegations are pleaded against a "Regional Council". This appears to be the case. The second defendant also submitted that s 94 does not confer private rights to damages upon individual for alleged breaches. The second defendant submitted that these claims could not be cured by amendment and thus should be dismissed. 44 The amended statement of claim as against the third defendant pleads: "3. Dumaresq Shire Council (DSC) is a local government authority from the New South Wales New England Region and is sued inter alia pursuant to Section 51AC of the Trade Practices Act 1974. 29. The Plaintiff at this time understood Mr Tydd and DSC to be providing expert and honest advice and believed and trusted Mr Tydd and/or DSC would not undertake and/or fail to undertake any actions, nor prove and/or with-hold any advice and/or information which would have any detrimental effect upon the Plaintiff and/or his ability to make an informed decision with regard to any requirements placed, or to be placed upon him or his business as a direct or indirect result of any dealings with Mr Tydd and/or DSC. 31. The Plaintiff agreed to enter a lease and deed of agreement based upon the acceptance by Mr Tydd of the Plaintiff's requirement that any lease or other document would need to contain two basic necessities which were not negotiable, which necessities were pre-requisites to any lease and/or other agreement to which the Plaintiff intended to become a party, those necessities being: (a) An option to renew the lease after the initial period of twenty years, and, (b) The plaintiff had the right to diversify, within the limitations of the certifications and authorizations attached to the constructed premises. 39. Had the Plaintiff been aware of the content of the DSC LEP, and his requirement to be bound by its' inclusions, the Plaintiff would not have entered into any agreement with DSC concerning the relocation of his business with ATSIC." 45 Particulars of negligence as against the third defendant are: "86. Particulars of negligence of the Defendant - DSC 87. breached its' fiduciary duty toward the Plaintiff in holding a meeting between Mr Tydd and a second and third party concerning the possible purchase of the Plaintiff's business and premises by the second and third parties, whilst specifically excluding the Plaintiff from this meeting. 88. engaged in unconscionable conduct with regard to its' dealings with the Plaintiff concerning the lease and deed of agreement documents presented to the Plaintiff by DSC for signing,. 89. in its dealing with the Plaintiff, breached Sections: 9(1), 10(1) a & b, (2) a & b, (3), 10A, 12(1), (2), 12A, 1213, 22, 77, 90, 91, 93, 99, 132(2) & (3), 134, 136, 137, 138, 164, 232(1) 7 (2), 335(1), (2) & (3), 372, 377(1), 664(1)a & b, of the Local Government Act 1993. 90. staff breached sections; 45DA (1) & (3), 45DC, 52, 53(a), (bb), (c), (e) & (g), 53A(1)B & (2), 58(a)i & ii, 59(2), 60, 71(1)a & b, (2) of the Trade Practices Act 1974." Unconscionable conduct 46 The gravamen of the plaintiff's complaint which he submitted constituted unconscionable conduct, is that the Council members coerced he and his wife to sign the lease two days before the plaintiff's business was due to open at a gala event that potential clients and dignitaries were due to attend. The plaintiff said that he did not properly sign the agreement as he never intended to be bound it. Although it was not clear to me, the plaintiff may be alleging that the third defendant should have supplied or given advice in relation to its local environment plan and failed to do so. Further it did not allow the plaintiff to paint a device used to load solvents on aircraft, but allowed a local mechanic to spray paint a helicopter and these omissions and acts constitute unconscionable conduct. 47 Earlier in this judgment I briefly mentioned the law on unconscionable conduct. It largely depends on the facts and circumstances being known. Although the case seems weak, the plaintiff should be given a further opportunity to refine his claim in relation to unconscionable conduct. 48 In relation to the statutory breaches of the Local Government Act (LGA) the events complained of occurred prior to the introduction of the Local Government Act 1993. Nevertheless, the section of the LGA quoted do not appear to give rise to a private cause of action. 49 For the reasons given earlier, the claims made under the TPA are, as currently pleaded, statute barred. Breach of fiduciary duty 50 The events that the plaintiff says give rise to his claim for breach of fiduciary duty against the third defendant was the Council members knew of the plaintiff's financial position and his efforts to sell his business to potential buyers. They used this information to negotiate on its own behalf with these same potential buyers. This claim has not been properly pleaded. I might add, it is not clear whether the plaintiff is attempting to mount a claim in negligence, but if he is, it is not properly pleaded. The duty of care and the breach of duties of care are not pleaded. 51 In United States Surgical Corporation v Hospital Products International Pty Ltd [1982] 2 NSWLR 766 McLelland J held that the court will recognise the existence of a fiduciary duty by analogy to a trust, where a person is obliged, or undertakes, to act in relation to a particular matter in the interest of another (the beneficiary) and is entrusted with the power to effect those interest in a legal or practical sense; and there is a special degree of vulnerability of those whose interest are entrusted to the power of another, to abuse of that power. (810-811). 52 A fiduciary may be held liable as a constructive trustee where either the fiduciary has obtained an unauthorised gain by virtue of his fiduciary position; or where the fiduciary has exploited for his own gain an opportunity or advantage which his fiduciary duty required him to pursue (if at all) for the benefit of the beneficiary. The critical matter is that the property to which the constructive trust attaches should be property the obtaining or pursuing of which was or ought to have been in all the circumstances, an incident of the relevant fiduciary duty (regardless of whether it could have been obtained for the benefit of the beneficiary). (813,814). Aggravated and exemplary damages 53 In paragraphs 119 and 120 the plaintiff has pleaded that he is entitled to exemplary damages equal to or greater than any other damages. Alternatively he has sought damages of a global sum of $33 million. 54 I turn to the difference between aggravated and exemplary damages which was discussed in Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118 at 149 Windeyer J said: "aggravated damages are given to compensate the plaintiff when the harm done to him by a wrongful act was aggravated by the manner in which the act was done: exemplary damages, on the other hand, are intended to punish the defendant, and presumably to serve one or more of the objects of punishment - moral retribution or deterrence." 55 In relation to aggravated damages, a passage in Halbury's Laws of Australia (1999) Reed International Books trading as Butterworths at paras 135-595) states that aggravated damages are recoverable in trespass, defamation, conspiracy, malicious prosecution and inducing breach of contract. It does not refer to breach of statutory duty but in a recent Court of Appeal decision Collings Constructions Co Pty Ltd & Anor v ACCC [1998] 43 NSWLR 131 (referred to later in this judgment) it was held that aggravated damages can be awarded for breach of statutory duty. In Collings, the Court of Appeal awarded aggravated damages for breach of statutory duty because s 87 of the Trade Practices Act 1974 (Cwth) should not be narrowly interpreted as a measure of damages in tort or contract, but provided for compensatory damages and aggravated damages are compensatory in nature (see Cole JA with whom Stein JA and Sheppard AJA agreed at p 156G). However Halsbury states that the absence of any element of damage at large will generally exclude an award of aggravated damages in negligence. 56 The passage cites Kralje & Anor v McGrath & Anor [1986] 1 All ER 54 as authority for this proposition. Kralje concerned an obstetrician who negligently delivered the plaintiff's baby who was a twin. The baby Daniel died as a result of injuries 9 weeks after birth. At p 61 Woolf J (as he then was) held that it would be wholly inappropriate to introduce into claims for breach of contract and negligence the concept of aggravated damages. His Honour's reasoning was as follows. If aggravated damages were to apply in this situation of a doctor not treating a patient in accordance with his duty, whether under contract or in tort, then he would consider that it must apply in other situations where a person is under a duty to exercise care. It would be difficult to see why it could not even extend to cases where damages are brought for personal injuries in respect of driving. If the principle is right, a higher award of damages would be appropriate in a case of reckless driving which caused injury than would be appropriate in cases where careless driving caused identical injuries. Such a result seemed to him to be wholly inconsistent with the general approach to damages in this area, which is to compensate the plaintiff for the loss that she had actually suffered, so far as it is possible to do so, by the award of monetary compensation and not to treat those damages as being a matter which reflects the degree of negligence or breach of duty of the defendant. Thus it would appear that aggravated damages are not available in claim for negligence. 57 In order for the defendant to meet the plaintiff's claim for exemplary damages the matters which found this claim should be pleaded. The claim for exemplary damages as currently pleaded cannot be sustained and should be struck out. However it is my view that the plaintiff should be afforded a further opportunity to replead these claims for damages provided he included the alleged factual bases for the alleged entitlement. 58 Aggravated damages can be awarded for breach of statutory duty but as previously stated it depends on the wording of the statute as to whether a breach will found an action and whether the remedy is available. If the statute does supply a remedy, the presumption is to use the remedy supplied. As the claim for aggravated damages is currently pleaded, it is difficult to see how this claim can be sustained and it should be struck out. 59 In the exercise of my discretion, the plaintiff should be given a further opportunity to replead his case against the second and third defendants. The plaintiff should give consideration so that the facts pleaded are those which are material. There is a lot of extraneous material in the amended statement of claim which should be deleted. A further amended statement of claim is to be filed and served within two (2) months. 60 Costs are discretionary. Paragraph 81 of the amended statement of claim remain on foot. The second defendant successfully obtained an order that the default judgment be set aside. It is my view that costs should be costs in the cause. 61 The orders I make are: (1) The proceedings are dismissed against the first defendant, the Commonwealth of Australia and the fifth defendant, the Australian Taxation Office. (2) The default judgment entered on 28 February 2000 as against the second defendant is set aside. (3) The plaintiff is to file and serve a further amended statement of claim which repleads the case against the second and third defendants. Such further amended statement of claim is to be filed and served within two (2) months. (4) Costs are costs in the cause. ********** Last Modified: 11/21/2000 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.