Supreme Court New South Wales Medium Neutral Citation: In the matter of Cougar Mining Group Pty Ltd [2016] NSWSC 1050 Hearing dates: Thursday, 4 August 2016 Decision date: 04 August 2016 Jurisdiction: Equity Before: White J Decision: Refer to para [65] of the judgment. Catchwords: PRACTICE AND PROCEDURE — Pleadings — Application to strike out pleadings — Application for particulars — Circumstance in which Court will entertain objection to pleadings and argument in relation to particulars — Contemporary purposes of pleadings — Material facts upon which the plaintiff relies for its claims for relief not pleaded — Defendants are not in a position to know what case they have to meet — Pleadings struck out with leave to replead Cases Cited: Verner v Giannaros [2016] NSWSC 242 Barclay Mowlem Construction Pty Limited v Dampier Port Authority [2006] WASC 281 Fiduciary Ltd v Morningstar Research Pty Ltd [2002] NSWSC 432; (2002) 55 NSWLR 1 Category: Procedural and other rulings Parties: Cougar Mining Group Pty Ltd (Plaintiff) VLI Drilling Pty Ltd (1st Defendant) VLI Diesel Hire Pty Ltd (2nd Defendant) Brett Lynch (3rd Defendant) VLI Pty Ltd (4th Defendant) Representation: Counsel: M Fantin (Plaintiff) R Marshall with K Madgwick (Defendants) Solicitors: McKays Law (Plaintiff) Osborn Law (Defendants) File Number(s): 2016/20563 Judgment 1. HIS HONOUR: The defendants seek orders that the plaintiff provide additional particulars of certain paragraphs of a further amended statement of claim filed on 12 May 2016, and also seek orders that numerous paragraphs of that pleading be struck out. They also seek orders that the plaintiff pay the defendants' costs of the proceedings to date, including reserved costs, and that the costs be payable forthwith. 2. Pleadings play an important function in identifying the issues in the proceedings and the case that the defendants are required to meet. In general, I am not sympathetic to applications to strike out pleadings. Nor am I sympathetic to wide-ranging requests for particulars. In Verner v Giannaros [2016] NSWSC 242 I referred to what Martin CJ said in Barclay Mowlem Construction Pty Limited v Dampier Port Authority [2006] WASC 281 (at [7]), namely that: "… provided a pleading fulfils its basic functions of identifying the issues, disclosing an arguable cause of action or defence, as the case may be, and appraising the parties of the case that has to be met, the Court ought properly be reluctant to allow the time and resources of the parties and the limited resources of the Court to be spent extensively debating the application of technical pleadings rules that evolved in and derive from a very different case management environment." 1. The present application does not involve the application of technical pleading rules. It involves the application of the fundamental rule that the plaintiff should plead the material facts upon which the plaintiff relies for its claims for relief to appraise the defendant of the case to be met. 2. I am concerned with a further amended statement of claim which is either the third or fourth evolution of the pleading. Because of the defendant's claim that all of the costs incurred in the proceedings to date have been wasted, it is necessary to say something about how the pleading has evolved and how various applications have been dealt with. 3. The proceedings were commenced by summons. The plaintiff, Cougar Mining Group Pty Ltd, joined as defendants two companies, one called VLI Drilling Pty Ltd as first defendant ("VLI Drilling"), and the other VLI Diesel Hire Pty Ltd as second defendant ("VLI Diesel Hire"). Attached to the summons were what were called particulars that Lindsay J directed stand as a pleading. 4. The relief sought in the summons included a claim that VLI Drilling be restrained from hiring or supplying, directly or indirectly, a machine called a VLI Driftrunner-G Series to Bulga Coal Pty Ltd; and that VLI Drilling be restrained from using, operating or running the machine on a coal mine called the Blakefield South mine site. Other relief sought in the summons was an injunction that both defendants not infringe or threaten to infringe the plaintiff's rights by either directly or indirectly offering for hire any F or G series driftrunners to the mining industry in Australia. A declaration was also sought as to the rights and liabilities of the parties under an agreement called a Hire Fleet Sales Agreement dated 18 September 2014 made between the plaintiff and VLI Diesel Hire. 5. A driftrunner is a transport vehicle used in underground coal mining. 6. The particulars to the summons alleged the entry into the Driftrunner F and G Series Hire Fleet Sales Agreement by Cougar Mining Group and VLI Diesel Hire. It pleaded cl 10.1 of that agreement that provides: "Subject to clause 10.5 and the Seller's [VLI Diesel Hire's] ongoing right to hire the Restrained Products to any entity owned or controlled by Peabody Energy, the Seller covenants and agrees with the Buyer [Cougar Mining Group] that the Seller from Completion it will not directly or indirectly offer for hire any of the Restrained Products to the mining industry in Australia, Related Body Corporates, Associates or Relatives." 1. Clause 10.2 provided: "The Seller covenants and agrees with the Buyer that the Seller will use its best endeavours to procure that none of its Related Bodies Corporate, Associates or Relatives will do anything which, if done by the Seller would breach any of the covenants or restrictions in clause 10.1." 1. Clause 10.4 provided, in substance, an acknowledgement by Cougar Mining Group that cl 10.1 did not prevent VLI Diesel Hire or its related body corporates, associates or "Relatives" from offering to hire or hiring out mining vehicles other than the Restrained Products, or offering to hire six of the Restrained Products made in China that was not part of the fleet, which was the subject of the agreement to a third party customer, including any entity owned or controlled by Peabody Energy, or entering into a hire and purchase agreement with a third party customer, or manufacturing and selling any mining vehicle whatsoever, including Driftrunner F and G series. 2. The term "Restrained Products" was defined as Restrained Products means "Driftrunner 'F' and 'G' Series". 3. Attached to the agreement was a schedule of driftrunners identifying the fleet that was the subject of the agreement. The agreement provided that VLI Diesel sold the fleet and Cougar Mining Group agreed to purchase the fleet. The purchase price was $6,890,000. 4. At the same time as the summons was filed, the plaintiff filed a notice of motion seeking an interlocutory injunction to restrain VLI Drilling from supplying or hiring a particular G series driftrunner to Bulga Coal Pty Limited, or from using or operating or running that driftrunner on the Blakefield South mine site. 5. On 21 January 2016, Lindsay J ordered that the defendants file and serve any defence to the plaintiff's statement of claim, that is to say, the particulars to the summons that his Honour had ordered should stand as the plaintiff's statement of claim. His Honour ordered that that defence be filed by 29 January; that any reply be filed by 5 February 2016; and his Honour made orders with a view to early discovery by directing the plaintiff seek from the defendants discovery limited to particular questions in dispute, and that the defendants serve a verified list of documents by way of discovery on the questions identified by the plaintiff if no objection had been taken to the nature or breadth of the discovery sought, and otherwise reserving to the defendants liberty to apply for an order discharging the orders in relation to the provision of discovery. The claims for interlocutory relief in the plaintiff's notice of motion were stood over before the Registrar for directions in March 2016. 6. The defendants filed their defence on 1 February 2016. In their defence they admitted that VLI Drilling had rented the driftrunner in question from the plaintiff for its use in drilling work at the Blakefield South coal mine. They have admitted that, as at the date of the defence, VLI Drilling was now using its own G series driftrunner in its drilling operations at the Blakefield South coal mine. In substance, the defendants' answer in relation to the particular driftrunner that was the subject of the initial pleading was that VLI Drilling was not hiring out the driftrunner to the operator of the coal mine, but that it had been contracted to provide drilling services for the coal mine and in doing so was now using not a driftrunner that it hired back from the plaintiff, but one of its own. 7. There was correspondence between the solicitors in February in relation to the giving of discovery. On 11 February 2016, the plaintiff's solicitors sought discovery of five categories of documents. One included a copy of the drilling services agreement with Bulga Coal. Another related to the production of board minutes, memoranda, invoices and the like relating to F and G series Driftrunners from 1 January 2013 to that date. The defendants agreed to provide discovery of a redacted copy of the drilling services agreement and agreed to provide the documents in the latter category to which I have referred insofar as they were relevant to the issues identified in the statement of claim. 8. The plaintiff also sought a copy of a drilling services agreement for another coal mine and coal miner, and copies of all relevant contracts relating to what were called the six F series driftrunners that the plaintiff said it had been informed might be being used at other sites. The defendants declined to produce those documents, saying that there was no issue on the pleadings in relation to such other equipment or the use of such other equipment on other sites. 9. In the meantime, on 10 February 2016, the plaintiff had filed a reply. The reply included additional allegations that should properly have been pleaded in the statement of claim. The plaintiff in its reply also, curiously, pleaded that it entered into the Hire Agreement in reliance on the promise contained in cl 10.4 of that document. It alleged that the defendants had "deviated" from the promise by indirectly offering for hire the G series driftrunner to Bulga Coal. This was, in substance, a repetition of the allegation of breach of cl 10 of the hire agreement. The reply alleged that the defendants had engaged in misleading and deceptive conduct or conduct likely to mislead and deceive in breach of s 18 of the Australian Consumer Law without pleading any material facts for that allegation. It alleged that the plaintiff had entered into the Hire Agreement in reliance upon an alleged "Representation". The alleged Representation was again said to be contained in cl 10 of the hire agreement. It was alleged that the Representation was false and misleading because of the alleged breach of cl 10 in relation to the hire of a driftrunner to Bulga Coal. It was alleged that the Representation was not made honestly by the defendants not disclosing their future intentions with respect to their ongoing hire of 'F' and 'G' series driftrunners. 10. On 15 April 2016, Pembroke J struck out the reply but granted the plaintiff leave to file and serve an amended statement of claim. His Honour directed that the first and second defendants file and serve their defences by 26 April 2016, and the proceedings were listed before the Registrar on 3 May 2016. 11. An amended statement of claim was filed on 22 April 2016. It repeated the allegations in relation to the hire by VLI Drilling of a G series driftrunner from the plaintiff for use by VLI Drilling at the Blakefield South coal mine, where the plaintiff's complaint appears to be that instead of hiring the driftrunner in question from it, VLI Drilling is using one of its own machines, perhaps one imported from its parent or related company in China, although this is not clearly alleged in the pleading. 12. The amended statement of claim also made an allegation in relation to VLI Drilling's no longer requiring the use of another driftrunner at a coal mine called Grasstree from the plaintiff, and said that that Driftrunner had been replaced with an F series Driftrunner. In other words, the same type of allegation was made in respect of a further machine. This was alleged to be a breach of the terms of the Hire Agreement. 13. There was then pleaded a puzzling allegation of promissory estoppel where the plaintiff alleged that it entered into the Hire Agreement in reliance on the promises contained in the Hire Agreement; alleged again a "deviation" from the promise, as a result of which it suffered loss. In some way which is unclear, that is said to give rise to some form of estoppel, although the precise estoppel was not pleaded. 14. Again the amended statement of claim pleaded misleading and deceptive conduct based upon a representation contained in the Hire Agreement itself, without any allegations of any other material facts which might give rise to a claim for misleading and deceptive conduct. 15. The amended statement of claim included a claim that the first defendant, VLI Drilling, had induced the second defendant, VLI Diesel Hire, to breach the Hire Agreement. The defendants had taken the point in their defence that only VLI Diesel Hire was a party to that agreement. The amended statement of claim thus added an additional cause of action in tort for interfering with contractual relations. 16. The pleading also contained an allegation of accessorial liability against the second defendant, VLI Diesel Hire, in relation to alleged misleading conduct of VLI Drilling. 17. The problems with that pleading were manifest. 18. On 3 May 2016, the Registrar noted that the plaintiff proposed to serve a draft further amended statement of claim for the defendants' consideration by 6 May. 19. When the matter came before the Registrar on 9 May 2016, the Registrar ordered that the amended statement of claim be struck out, and she also ordered that the plaintiff's notice of motion filed on 20 January 2016 be dismissed. Orders were made giving the plaintiff leave to join another company in the group of companies associated with VLI Drilling, namely VLI Pty Limited, and gave leave for the plaintiff to join a director of the companies, a Mr Brett Lynch. The plaintiff was given leave to file a further amended statement of claim, and orders were made in relation to requests for particulars. 20. The further amended statement of claim was filed on 12 May 2016. For the reasons which follow, that pleading should be struck out. Notwithstanding the plaintiff's numerous attempts to formulate an adequate pleading, it should have liberty to replead. However, the time must come to an end in which the plaintiff can have repeated attempts to reformulate its claim in an intelligible way. I do not propose to make any guillotine type order in relation to any further pleading that the plaintiff will have leave to file, but the plaintiff is on notice that it is required now, if the matter is to proceed, to plead the material facts which form the basis of its complaint. 21. For the reasons which follow, it is not clear to me whether the plaintiff intends to abandon its claim for damages and injunctive relief for breach of the Hire Agreement. In its further amended statement of claim the plaintiff abandoned its claim in tort for knowing inducement of breach of contract. It has pleaded a claim of misleading or deceptive conduct and unconscionable conduct by reason of the making of various representations. But it has not pleaded the material facts by reason of which it says the representations were misleading or deceptive, or involved the defendants' engaging in unconscionable conduct. 22. There are other difficulties with the pleading, both in relation to what is said and what is not said, in particular in relation to the pleadings of a claim of breach of contract. 23. The pleader alleges that on 2 August 2014 the fourth defendant, Mr Lynch, who is alleged to be CEO and Director of VLI Pty Ltd and five companies (of which it is said to be the sole shareholder), made certain representations to a Mr Craig Barnett of the plaintiff. These are identified in the pleading as the "First Representations" as follows: "'F' and 'G' series driftrunners were legacy technology and were going to be superseded by the 'H' series driftrunners; If the plaintiff purchased the 'F' and 'G' series driftrunners that competed with new technology ('H' driftrunners), then VLI would not compete with the plaintiff; VLI would offer protection by including a non-compete clause in the 'Contract of Sale' and included juggernauts and the 'H' series driftrunners for 12 months; VLI was under financial hardship and had cash flow issues; VLI's parent company was about to breach its covenants with its own bank unless they came up with a substantial amount of money; VLI was prepared to discount the sale from $10 million to $6.9 million but couldn't accept $6.0 million; As a sweetener, VLI would guarantee part of the plaintiff's income by making the first defendant enter into a hire agreement for 13 driftrunners with the plaintiff, which the first defendant had hired from the second defendant. (First representations)" 1. The representations included that if the plaintiff purchased the F & G series driftrunners that competed with new technology "H" driftrunners, then VLI would not compete with the plaintiff. The reference to "VLI" is to all of the VLI Australian companies. It is also said that Mr Lynch represented that VLI would offer protection by including a non-compete clause in the contract of sale that included certain equipment, including H series Driftrunners for 12 months, and as a sweetener, VLI will guarantee part of the plaintiff's income by causing VLI Drilling to enter into a hire agreement with the plaintiff. This was a representation said to have been made following the plaintiff expressing an interest in response to a request for tender. 2. The pleading then refers to certain email exchanges, including exchange of draft terms and conditions of the contract which are said to have included a non-compete clause in some draft terms and conditions. (See paragraphs 14-17.) It is then alleged in paragraph 18 that in around mid-September 2014 the solicitors for the third defendant, VLI Pty Ltd, sent the "Driftrunner Agreement" to the plaintiff. It appears from the document produced on the application, being documents provided by the plaintiff's solicitors in response to a request for particulars, that this is a reference to an email sent by Moray and Agnew to Mr Biki, the plaintiff, on 12 September 2014 attaching a draft of the Fleet Sale Agreement. The email said that: "Please see attached Draft Fleet Sale Agreement for your review. Following your review, VLI reserves the right to amend the draft". 1. The plaintiff then pleaded paragraphs 19, 20 and 21. Paragraph 19 refers to a concern allegedly held by a Mr Yang. Paragraph 20 alleges a number of representations which are described as the "Second Representations" said to have been made by Mr Lynch on or around 24 September 2014. Paragraph 21 refers to what is called the "Third Representation" alleged to have been made on or around 20 September 2014. Paragraph 19 alleges that Mr Yang became concerned between 19-24 September 2014 about, amongst other things, the plaintiff's not executing the Driftrunner Agreement, nor executing a letter dated 18 December 2014, the significance of which does not appear from the pleading. It also alleges that Mr Yang had become concerned by the third defendant's not having received $6.89 million from the plaintiff's bank. It alleges an oral communication between Mr Barnett to Mr Matt White, the latter being of the third defendant, that Mr Barnett was not sure about the deal and wanted to pull out. 2. Paragraph 21, which alleges the "Third Representation", alleges that on or about 20 September 2014 Mr Lynch told Mr Dillinger from VLI to sign the agreement on behalf of the plaintiff and that the plaintiff had a guaranteed non-compete. It alleges that Mr Lynch said to Mr Dillinger: "Sign the Driftrunner Agreement and don't be concerned about this deal. Cougar are guaranteed and protected by the non-compete, they can injunct us and the Chinese wont [sic] manufacture F & G series in the future, we'll bring in the H series". 1. It is then alleged in paragraph 22 that without obtaining legal advice, Mr Dillinger signed the Driftrunner Agreement and that no other director from the plaintiff signed it. In paragraph 28 it is alleged that the plaintiff entered into the Driftrunner Agreement in reliance upon the First and the Second Representations. 2. The Second Representations are alleged to have been made on or around 24 September 2014, apparently after the entry into the Driftrunner Agreement, although the current pleading does not plead specifically when it is said the agreement was entered into. (In the amended statement of claim, that Mr Dillinger verified, it was alleged that both the plaintiff and the second defendant, VLI Diesel Hire, executed the Driftrunner Agreement on 18 September.) 3. The Second Representation, said to have been made on or about 24 September, in reliance on which it was said the plaintiff entered into the Driftrunner Agreement, included alleged representations made by Mr Lynch that, amongst other things, the plaintiff had a guaranteed and protected non-compete, that: "b) 'we', VLI, would not compete with the plaintiff; c) If there were any issues with 'us' competing with the plaintiff then the plaintiff could injunct VLI; d) The plaintiff had total market control of 'F' and 'G' series driftrunners given the non-compete; ... g) wouldn't launch 'H' series driftrunners for 12 months; … Cougar could rely on the Driftrunner Agreement against any of the VLI companies if one of the VLI companies competed with the plaintiff." 1. It was said that Mr Lynch "represented", "Just talk to your bank and get them to make the transfer". 2. Amongst the documents in evidence on this application is email correspondence in which Mr White pressed for payment of the moneys payable under the Driftrunner Agreement. He noted on 22 September that Cougar Mining Group had stated that the earliest the payment would be made for the fleet would be Wednesday, 24 September. 3. There are difficulties, even at this stage of the pleading, in understanding whether it is the plaintiff's case that it was induced to enter into the Driftrunner Agreement, previously called the "Hire Agreement", that is dated 18 September 2014, in reliance upon all the representations which were alleged, including those alleged to have been made on or about 24 September, or whether it is the plaintiff's case that it was induced to honour its obligation under the agreement by making the payment provided for under it, by reason of the representations alleged. But these problems are not the principal vice of the pleading. 4. Having alleged that the plaintiff entered into the Driftrunner Agreement in reliance on the First and Second Representations, paragraph 29 then alleges as follows: "29 The first, second and third defendant through its common director, the fourth defendant has, in trade or commerce: Engaged in conduct that was misleading and deceptive and was likely to mislead or deceive, in contravention of section 18(1) of the ACL; and Engaged in conduct that was unconscionable, in contravention of s 20(1) of the ACL; By: (a) Making the First, Second and Third Representations: (b) Making false or misleading representations that none of the VLI companies would compete with the plaintiff by 'directly or indirectly offering for hire the Restrained Products (as defined in the Driftrunner Agreement) to the mining industry, Related Body Corporates, Associates or Relatives; (c) Making false or misleading representations that the second defendant would ensure that none of the VLI companies would compete with the plaintiff by 'directly or indirectly offering for hire the Restrained Products to the mining industry Related Body Corporates, Associates or Relatives; (d) Making false or misleading representations that the sale of the Restrained Products to the plaintiff was protected or guaranteed by the Driftrunner Agreement; (e) Making false or misleading representations that the plaintiff was entitled to seek injunctive relief from the first, second, third defendants or any other of the VLI companies to enforce its non-compete clause; (f) Making false or misleading representations that the plaintiff could invoke clause 10 of the Driftrunner Agreement to enforce its rights to protect its position and non-compete where one of the VLI companies directly or indirectly offered for hire the Restrained Products to the mining industry. And thereby the fourth defendant representing that: (a) the plaintiff had assurances that VLI weren't going to compete with the plaintiff anytime in the future; (b) the non-compete was protected and guaranteed; (c) he and the first, second and third defendants would be bound by the VLI T&C; (d) that the terms of the VLI T&C were not significantly different from the Driftrunner Agreement; (e) he and the first, second and third defendants would be bound by the Driftrunner Agreement; (f) the Driftrunner Agreement was not significantly different from the earlier agreed VLI T&C; (g) he and the first, second and third defendants would ensure that other VLI related companies would not compete against the plaintiff and protect the plaintiff in the event one of the VLI companies decided to compete with the plaintiff; (h) the Driftrunner Agreement did not include the other VLI companies because the second defendant owned the Restrained Products and had to be named as a party to the contract; (i) the plaintiff could rely on the Driftrunner Agreement for any breaches made by any of the VLI companies including any breaches by first, second, third defendants and any other VLI companies as per the VLI T&C; (j) first defendant would 'On Hire' the Restrained Products (as part of the VLI Drilling Services Contract) from the plaintiff as set out in schedule 2 of the Driftrunner Agreement; (k) the plaintiff had right of first refusal for hire where the first, second, third defendants or any other of the VLI companies wanted to or where offered to enter into 'On Hire' the Restrained Products with third parties in the mining industry; (l) the plaintiff was the only company in the mining industry offering the Restrained Products to the mining industry; and (m) the plaintiff would make millions from the deal." 1. Paragraph 30 then alleges: "As a result of the first, second, third or fourth defendants' breach, in contravention of sections 18 and 20 of the ACL, the plaintiff is entitled to compensatory order declaring the whole or any part of the Driftrunner Agreement void or void ab initio pursuant to sections 237, 242 and 243 of the ACL. In the alternative, the plaintiff is entitled to a statutory injunction against the defendants. Further, the plaintiff has suffered loss and damage and entitled to recover the amount of the loss or damage pursuant to section 236 of the ACL. PARTICULARS To be confirmed after Discovery; First defendant replacing the plaintiff's driftrunner with serial no./call sign: 55541; and CMG026 Loss of income: 4 weeks for each driftrunner @$2,500 per week $20,000 Total Loss: $TBC" 1. Nowhere is it alleged why the making of the First, Second or Third Representations involved engaging in conduct that was misleading and deceptive or unconscionable. Nowhere is it alleged why the representations referred to in paragraph 29(b), (c), (d), (e) and (f) were false. This pleading, unlike its predecessors, does not contain any allegation that contrary to what was represented, the defendants or any of them have competed with the plaintiff in a way which is said to be contrary to a representation. Nor is it alleged that when the representations were made, the defendants did not intend to honour them. It is not alleged (although this was suggested in argument) that at the time the representations were made, the Chinese parent of the defendants intended to send its F & G series driftrunners to its Australian companies in order for them to use them in competition in some way with the plaintiff. One can infer, but it is only a matter of inference, that the plaintiff's business involves the hiring out of equipment of the kind, including driftrunners, but it is not alleged what is the conduct of the defendant that might involve competition with the plaintiff's business. 2. It does appear from paragraph 30 that the basis on which the plaintiff now puts its case is not that the second defendant is in breach of the Hire Agreement (that is the Driftrunner Agreement) of September 2014, but rather that either no agreement was entered into, perhaps because only one director signed it for the plaintiff, or alternatively, that the Driftrunner Agreement should be declared void ab initio. In this way, perhaps the plaintiff seeks to avoid the limitations on the non-competition clause in the agreement and a provision of the agreement that it constituted the entire agreement between the parties with respect to its subject matter and superseded any prior representation, understanding or arrangement given or made by the parties, whether orally or in writing (Cl 15.4). 3. However, that might be a misconception because in paragraphs 31-34, the pleading goes on to allege that the fourth defendant, Mr Lynch, has accessorial liability, including as follows: "33 By reason of the matters alleged in paragraph [31] above, the fourth defendant is a person ... who was involved in the second defendant's breach of the Driftrunner Agreement as the second defendant did not use 'its best endeavours to ensure that none of its Related Bodies Corporate would do anything, which if done by the second defendant would breach the covenant and restrictions in cl 10.1 of the Driftrunner Agreement ...". 1. In other words, without alleging in the present pleading, in contrast to the earlier pleadings, that the second defendant did breach the Driftrunner Agreement, by this paragraph the plaintiff alleges that the fourth defendant has accessorial liability in respect of the second defendant's (unpleaded) breach. 2. I did not glean any clear understanding from the submissions of counsel for the plaintiff as to what the plaintiff's position is in respect of any claim for breach of contract. Having regard to what is alleged in para 33 I apprehend that the plaintiff might intend to maintain, albeit as an alternative claim, that there was such a breach by the second defendant, but this is not alleged. 3. This pleading singularly fails to meet the objects of a pleading. It does not enable the defendants to know the case they have to meet. 4. As an illustration of that, when invited to explain how it is that the plaintiff alleges that the defendants have not honoured the alleged representations I was referred not only to the allegations concerning the use by VLI Drilling of its own driftrunner in providing services to Bulga Coal, but I was also referred to an email apparently from a Mr McDonald of one of the VLI companies to a Mr Robinson, apparently an officer of the Peabody group. The email stated that VLI was looking to re-establish a driftrunner hire fleet with the Peabody Group made from brand new plant and operated by VLI and noted that an agreement expired on 31 March 2016, apparently an agreement between VLI and the Peabody Group. 5. It is simply not clear to me on what basis it will be put that any such intention was a breach of either a contract or any of the alleged representations. It is to be borne in mind that the Hire Agreement itself in cl 10.1 excepts from the restraint on dealings the Seller's "ongoing right to hire the Restrained Products to any entity owned or controlled by Peabody Energy". There might be a question as to whether what is proposed involves the exercise of an "ongoing right", or it might be said that somehow that exception in cl 10.1 has no operation having regard to the alleged representations. 6. I do not know whether it might be said that what is proposed would be a breach of the representations, whether or not it involved hiring out vehicles other than F&G series driftrunners. 7. The defendants are not in a position on the present state of the pleadings to know what case they have to meet. I think this is a deplorable state of affairs. Contrary to the submissions made by counsel for the plaintiff it is not a state of affairs attributable to the defendants. 8. Counsel for the plaintiff submitted that the defendants had abused the process of the Court by the extent of the requests for particulars they have made, by the service of the notice of motion for striking out the plaintiff's pleadings, by not having filed a defence to the further amended statement of claim, by not complying with Lindsay J's orders for discovery, as well as by failing to respond to a settlement attempt. It was said that the service of the strike-out applications was a tactic to make this case go away so that the defendants could proceed with their strategy in the market. That was a serious allegation for which there is no proper basis and should never have been made. 9. There has been no issue as to whether or not the orders for discovery made by Lindsay J were breached. Having regard to the state of the pleadings as it was at the time, I would not be prepared to find that the position taken by the defendants did involve a breach of his Honour's orders. In any event, the appropriate step for the plaintiff, if it were concerned about that, was to bring the matter back on any of the occasions in which it was before the Court from March this year. 10. As to the requests for particulars, it is true that they were extensive but I think they were justified, having regard to the deficiencies of the pleading. Having said that, I would not in any way seek to encourage solicitors or counsel embarking upon detailed requests for particulars. But in this case it was and remains unclear exactly what it is that the plaintiffs are contending for. 11. The defendants do not oppose the plaintiff having leave to replead and I will grant such leave accordingly. 12. The question then is whether or not the plaintiffs should pay all of the defendant's costs in the proceedings to date. There have been seven court appearances before today by the defendant: on 20 January when orders for short service were made but where the defendant appeared; on 21 January when Lindsay J made orders to which I previously referred; on 2 March when the Registrar listed for hearing before the Applications Judge the defendant's notice of motion of 25 February that sought orders striking out the reply and discharging orders in relation to discovery; on 15 April 2016 when the matter was before Pembroke J in the Applications List and where his Honour struck out the reply and directed the plaintiff to pay the defendant's costs thrown away by the proposed amended statement of claim and otherwise dismissed the notice of motion filed on 25 February 2016 and ordered the plaintiff to pay the defendants' costs of that motion; on 3 May 2016 before the Registrar when, as previously noted, the Registrar noted the plaintiff's intention to serve a draft further amended statement of claim; on 9 May when the Registrar made orders for the striking out of the amended statement of claim and dismissed the plaintiff's notice of motion of 20 January 2016; and on 21 June when the Registrar fixed the notice of motion with which I am presently concerned for hearing before me today. The defendants will be entitled to their costs of that motion. 13. I think all of the costs incurred by the defendants on those attendances would have been wasted. The defendants still do not have a pleading to which they can respond. In correspondence the defendants' solicitors also contended that the work done in giving such discovery as was given would have been wasted, having regard to the way the case is now pleaded. However, I have doubts as to whether that will necessarily remain the position. That may depend upon what the plaintiff pleads, including whether it ultimately again pleads an alleged breach of the Hire Agreement and whether it alleges that the arrangements concerning Bulga Coal involve a breach of any contract or representation. There may be other work done by the defendants that would be of some assistance to them in their conduct of the proceedings if and when the matter can be put in a position where it is ready to proceed. 14. I am not minded to make an order that the plaintiff pay all of the defendants' costs of the proceedings to date. But having regard to the delays to date, there is force in the defendant's submission that it is appropriate that an order be made to displace what would otherwise be the operation of r 42.7 of the Uniform Civil Procedure Rules, that costs of interlocutory applications do not become payable until the conclusion of the proceedings. 15. Grounds upon which a contrary order might be made under r 42.7 include where costs have been incurred as a result of unreasonable conduct by the party against whom the costs order has been made, and also where costs are significant and the time for payment may otherwise be long postponed because of the state of the proceedings (Fiduciary Ltd v Morningstar Research Pty Ltd [2002] NSWSC 432; (2002) 55 NSWLR 1). Certainly the first of those grounds is satisfied in this case. And I think there is reason to fear that having regard to the way the plaintiff has conducted its case to date that the resolution of these proceedings might take some time. 16. The plaintiff has stridently criticised the defendants for delay, but the responsibility for this case being in the state it is at the moment lies not with the defendants, but with the way the plaintiff has sought, but inadequately sought, to formulate its case. 17. Having regard to the way the case has proceeded and the fact that the plaintiff apparently did not proceed with his application for interlocutory injunctive relief, there does not seem to be any particular reason for the matter to have been started in the duty list with attendances by legal representatives for the defendants on two occasions before Lindsay J. And as I have said, the other attendances seem to me to this point to have been wasted. 18. The orders I make are as follows: 1. Order that the further amended statement of claim filed on 12 May 2015 be struck out with liberty to the plaintiff to replead. 2. Order that the plaintiff file and serve a second further amended statement of claim by 1 September 2016. 3. Stand the proceedings over into the Registrar's list on 8 September 2016. 4. Order that the plaintiff pay the defendants' costs of their appearances on 20 and 21 January 2016, 2 March 2016, 15 April 2016, 3 May 2016, 9 May 2016 and 21 June 2016. 5. Order that the plaintiff pay the defendant's costs of the defendant's notice of motion dated 20 June 2016. 6. Order that the plaintiff pay the defendant's costs thrown away by reason of the filing of the further amended statement of claim and the striking out of the further amended statement of claim. 7. Order pursuant to r 42.7 that the costs the subject of the order made by Pembroke J on 15 April 2016, and the subject of the orders made by me today, may be assessed forthwith and are to be payable forthwith after agreement or assessment. 8. The court book can be returned in due course after I have had the opportunity to see the transcribed reasons for judgment. ********** 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. Decision last updated: 22 August 2016