CATCHWORDS
Practice and Procedure - whether party making submission should be put to election - functions of judge in ruling upon submission of no case to answer - whether judge took into account information which had not been admitted into evidence
Petroleum Retail Marketing Franchise Act 1980 (Cth)
Judiciary Act 1903 (Cth)
Residues Treatment & Trading Co. Ltd v Southern Resources Ltd (1989) 52 SASR 54
Protean (Holdings) Ltd (Receivers and Managers Appointed) v American Home Assurance Co. [1985] VR 187
Treharne v Geo. McEwin & Son Pty Ltd (1982) 44 ALR 543
Trade Practices Commission v George Weston Foods Ltd (No.2) (1980) 43 FLR 55
Stevenson v Barham (1977) 136 CLR 190
Muller & Co. v Ebbw Vale Steel, Iron & Coal Co. Ltd [1936] 2 All ER 1363
J-Corp Pty Ltd v Australian Builders Labourers Federated Union of Workers (1992) 111 ALR 377
Queensland v JL Holdings (1997) 71 ALJR 294
Sali v SPC Ltd (1993) 67 ALJR 841
House v R (1936) 55 CLR 499
Hocking v Bell (1945) 71 CLR 430
Dublin, Wicklow and Wexford Railway Co. v Slattery (1878) 3 App. Cas. 1155
Barker v Charley (1962) 62 SR (NSW) 296
Jones v Dunkel (1959) 101 CLR 298
News Limited v Australian Rugby Football League Limited (1996) 64 FCR 410
Matter No. SG 14 of 1997
RASOMEN PTY LTD (trading as SHELL FAIRVIEW PARK) v THE SHELL COMPANY OF AUSTRALIA LIMITED
von Doussa, Drummond & Finn JJ
Adelaide
27 May 1997
IN THE FEDERAL COURT
OF AUSTRALIA
SOUTH AUSTRALIA
DISTRICT REGISTRY No. SG 14 of 1997
GENERAL DIVISION
BETWEEN: RASOMEN PTY LTD (trading as SHELL FAIRVIEW PARK)
Appellant
AND: THE SHELL COMPANY OF
AUSTRALIA LIMITED
Respondent
MINUTES OF ORDER
JUDGES MAKING ORDER : VON DOUSSA, DRUMMOND &
FINN JJ
WHERE MADE : ADELAIDE
DATE ORDER MADE : 27 MAY 1997
THE COURT ORDERS THAT:
That the appeal be dismissed with costs.
Note: Settlement and entry of orders are dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT
OF AUSTRALIA
SOUTH AUSTRALIA No. SG 14 of 1997
DISTRICT REGISTRY
GENERAL DIVISION
BETWEEN: RASOMEN PTY LTD (trading
as SHELL FAIRVIEW PARK)
Appellant
AND: THE SHELL COMPANY OF
AUSTRALIA LIMITED
Respondent
REASONS FOR JUDGMENT
Coram : von Doussa, Drummond & Finn JJ
Place : Adelaide
Date : 27 May 1997
The Court:This is an appeal from a decision of a single judge of this Court (Branson J) which dismissed the claim of the appellant after consideration of a submission by the respondent that there was no case to answer. The appellant had sought in its application a declaration that “a Franchise Agreement pursuant to the provisions of the Petroleum Retail Marketing Franchise Act 1980 was entered into between the Applicant and the Respondent in or about January 1988”. The pleadings alleged that the franchise agreement related to the lease by the appellant of a Shell service station at Lot 202, The Grove Way, Golden Grove in the State of South Australia (“the service station”) which the respondent obtained the right to operate on or about 4 October 1995. Consequential orders for specific performance, injunctions and damages were claimed. At trial the appellant pressed only a money claim for the profits it alleged that it had lost by reason of the respondent’s denial of its entitlement to operate the service station as lessee.
At the close of the appellant’s case at trial, the respondent sought to argue that the case should be dismissed on the basis that there was no case to answer. Before determining whether or not to entertain that submission, the trial judge heard counsel on the issue of whether the respondent should be put to its election not to call evidence should the submission be entertained. Counsel for the respondent sought a ruling that the respondent was entitled to put the submission without being required to elect, and relied on the decision of Perry J in Residues Treatment & Trading Co. Ltd v Southern Resources Ltd (1989) 52 SASR 54 at 60 (“the Residues Treatment case”). In that case Perry J accepted the following passage from a judgment of Tadgell J sitting in the Full Court of the Supreme Court of Victoria in Protean (Holdings) Limited (Receivers and Managers Appointed) v American Home Assurance Co. [1985] VR 187 at 237 (“the Protean case”) as a correct statement of the law:
“The judge is entitled, for reasons that seem appropriate to him, to decline out and out to entertain such a submission at the stage at which he is asked to do so. Normally, however, the Judge would not feel justified in refusing outright to hear a submission of no case if to hear it would carry the prospect of justly facilitating the disposition of the litigation. Usually there would be three courses open to him, short of refusing altogether to entertain the submission, namely:-
1. He might decline to entertain the submission at that stage unless the moving party were to elect before making it not to call any evidence, either generally or on the issue on which the ruling was sought; or
2. He might allow the submission to be made without putting the moving party to any election at that stage but leaving, until he had heard it, the question whether or not he would rule on it without requiring an election to be made; and having heard the submission, and any answer to it by the respondent party, he could either rule on it or not, perhaps requiring an election to be made as a prerequisite to his doing so; or
3. He might indicate that he would both entertain the submission and rule on it without requiring an election to be made by the moving party.”
The trial judge expressed her agreement with that statement of the law, and adopted the second of the courses identified, namely that the submissions should be made and answered, leaving for later decision the question whether the respondent should be put to its election.
To understand the submissions that were then made in support of the contention that there was no case to answer, it is necessary to refer to the background facts which were either admitted or not in dispute at trial, and to the case pleaded by the appellant against the respondent.
The appellant has at all material times been the franchisee of the respondent in respect of a Shell service station at Fairview Park in the State of South Australia (“Fairview Park premises”).
A franchise agreement between the parties in respect of the Fairview Park premises which commenced on 2 July 1985 was to expire on 31 December 1987. Approaching the expiry there were negotiations between the parties as to the rental terms on which the franchise agreement would be renewed. In particular, there was a meeting on 22 December 1987 between Rosemary Jean Reichstein (“Mrs Reichstein”) and Philip James Reichstein (“Mr Reichstein”) who are the directors of the appellant, and officers of the respondent including John Hendrickson (“Mr Hendrickson”). This meeting was followed by correspondence and a further discussion in January 1988. A letter from the respondent to the appellant dated 28 January 1988 is essential to the appellant’s case which was pleaded in two ways. First the appellant pleaded a case in contract, and secondly it pleaded a promissory estoppel said to preclude the respondent from acting in a manner inconsistent with certain alleged representations.
Paragraph 2 of the statement of claim identifies the contract relied on by the appellant. That paragraph reads:
“2. In or about January 1988 it was agreed by and between the Applicant and Respondent that in consideration of the Applicant continuing to operate [the Fairview Park premises], then upon the Respondent obtaining the right to operate its first service station in the Golden Grove area, a suburb of Adelaide (‘the service station’), the Respondent would grant the site to the Applicant as an ‘Auto Care Franchise’ that is to say a franchise, pursuant to the Act [i.e. the Petroleum Retail Marketing Franchise Act 1980], and subject to the provisions as to tenure and other matters regulated by the Act and thereupon determine other conditions of the said Agreement pursuant to the provisions of section 9 of the said Act.
PARTICULARS
2.1 At a meeting with respect to Fairview Park it was said by a representative of the Respondent that if the Respondent obtained a licence to operate its first service station in the Golden Grove area, then the applicant would be granted the right to have the franchise for the said service station.
2.2 On or about the 28th January 1988 the Respondent wrote to the Applicant in the following terms:
‘Dear Sirs
We refer to our discussion with yourselves on 18th January 1988 and confirm our agreement with you regarding potential developments in the Golden Grove area.
It is likely that permission will be given to build a new service station in this area. Should The Shell Company obtain the right to operate this service station, you will be given the first right of refusal to lease it, providing you are still our lessee at Shell Fairview Park.
We will determine the conditions of the lease at the time, however we confirm that the site will be an Auto Care franchise.
Yours faithfully
For THE SHELL COMPANY OF AUSTRALIA LIMITED
(signed)
MELOS SULICICH
Retail Area Manager’”
The plea of promissory estoppel is set out in paragraphs 13 and 16 of the statement of claim. Identical particulars to those set out above were relied on in support of paragraph 13 of the statement of claim. These paragraphs read:
“13. In or about December 1987 to January 1988, the Respondent represented, offered or promised, that upon the Respondent obtaining the right to operate its first Service Station in the Golden Grove area a suburb of Adelaide (‘the service station’) the Respondent would grant the site to the Applicant as an Auto Care Centre that is to say a franchise pursuant to the Act and subject to the provisions as to tenure and other matters regulated by the Act and thereupon determine other conditions of the said Agreement pursuant to the conditions of Section 9 of the said Act providing the Applicant was still the Franchisee at the [Fairview Park premises].
...
16. The Applicant, acting in reliance upon the said Representations and assumptions acted to its detriment in that it remained as franchisee at the Fairview Park site and it supported the respondent’s application for a licence to operate a service station in the Golden Grove area by attending the hearing of the licence application and giving evidence by its director in support.”
Before the trial judge, the respondent contended that there was no evidence which could support a finding of a contract in the terms pleaded by paragraph 2 of the statement of claim, and further that the alleged contract was by its asserted terms so vague as to be unenforceable. So far as the case rested on the basis of promissory estoppel, the respondent submitted that there was no evidence to support a finding of a representation, offer or promise in the terms pleaded in paragraph 13 of the statement of claim, and further that there was no evidence that the appellant acted to its detriment in reliance on any representation, offer or promise of the respondent.
After hearing submissions the trial judge reserved her decision. In the reasons for judgment later delivered her Honour ruled that the respondent should not be put on its election to call no evidence. Her Honour referred again to the Residues Treatment case where at 68 Perry J identified the following four categories of cases in which a submission of no case to answer might be made:
“1. Where no reference at all to the evidence is required.
2. Where a reference to the evidence is required only to establish that there is an evidentiary hiatus or failure to adduce any evidence as to an essential element in the cause of action.
3. Where it is argued that on a consideration of the evidence adduced by the plaintiff taken at its highest from the plaintiff’s point of view, the evidence could not support the causes of action pleaded.
4. The situation where it is contended that although there is some evidence to support the plaintiff’s claim, it is so weak and unreliable that it should be dismissed without calling upon the defendant.”
His Honour went on (at 69):
“As to category 1, this should normally be argued on the pleadings, preferably before the trial commences. No question of election arises in that situation. Likewise, consideration of a submission of no case to answer in category 2 should not involve an election.
As to categories 3 and 4, these situations should normally be met by the application of what I have referred to as the general rule that counsel should be called upon to elect.”
The trial judge considered that the submissions made by the respondent placed the case in the second of the categories identified by Perry J. Before this Court, counsel for the appellant has not challenged the correctness of Perry J’s identification of the four categories of cases in which a submission of no case might be made. Rather, counsel’s submissions are to the effect that the case falls into the third category, not the second.
Her Honour considered the evidence led during the appellant’s case. The conversation between those present at the meeting on 22 December 1987 had been secretly recorded on tape by the appellant’s directors and an agreed transcription of the recording had been admitted into evidence. There was therefore no dispute as to what was said and by whom on that occasion. The relevant portion of the conversation was initiated by Mr Reichstein. He raised an earlier discussion between himself and a representative of the respondent, and said:
“One other point, if and when, now, this was discussed with Hoffman and he said yes I could have first go if and when you do build a new service station at Golden Grove, if you do happen to win the licence for that one. Do I still get first pop at that?”
After some discussion which is not presently relevant, Mr Reichstein went on -
“The concept was that one wouldn’t hold its own if you get the licence, wouldn’t hold its own for the first 12 months. The concept would be utilising the 2 workshops - everything all in one where they could go to either one.”
Mr Hendrickson replied:
“Makes sense. I knew we looked at an outlet in Golden Grove but I haven’t given it much thought. But I don’t have a problem with that.”
Mr Reichstein said:
“I first found out about it, even before Shell did and ... for Shell so ...”
Mr Hendrickson asked:
“There’s nothing on the books though is there?”
Mr Reichstein asserted that there was, and another officer of the respondent stated:
“John Barker is still negotiating. The land will go up for auction, there is no question about that, and I feel ... there’s no question about that.”
The relevant conversation concluded with Mr Hendrickson saying:
“I’d be happy to have an agreement drawn up if you like.”
At a further meeting on 18 January 1988 Mr Reichstein asked the respondent’s representatives for “my letter for Golden Grove”. That led to the letter of 28 January 1988 pleaded in paragraph 2 of the statement of claim. The letter was also admitted by the respondent.
Her Honour summarised the cases advanced by each side:
“The applicant contends for a reading of the letter of 28 January 1988 which would give rise to a unilateral contract to the effect that if the respondent should at any time obtain the right to operate its first service station at Golden Grove, then, provided that the applicant was still the respondent’s lessee at Fairview Park, the applicant would be given by the respondent the first right of refusal to lease such service station.
The respondent contends that the letter of 28 January 1988 can only be sensibly read as referring to a particular service station which would come into being on a specific site if, as was likely as at the date of the letter, permission to build a service station on such site were given. The respondent identified the present site of a BP service station at Golden Grove as the specific site to which the letter referred.”
This summary fairly reflects the positions taken by the parties in the pleadings. The respondent in its defence had identified the BP service station site as that to which the letter of 28 January 1988 referred.
Her Honour held that having regard to the surrounding circumstances, the letter of 28 January 1988 could only sensibly be understood as being intended to operate should the respondent obtain the right to operate the particular service station in the Golden Grove area to which the author of the letter saw permission to build as being likely. That is, the letter referred to a specific site. Her Honour considered the construction of the letter contended for by the appellant was not a construction which was reasonably open. She said:
“The letter refers to ‘a new service station’ in the Golden Grove area. In going on to state, ‘Should the Shell Company obtain the right to operate this service station, you will be given the first right of refusal to lease it ...’, the author of the letter makes it plain, in my view, not only that a particular service station is the subject of the letter, but also that the possibility exists that the respondent may not obtain the right to operate the service station the subject of the letter.”
The trial judge considered that the conversation at the meeting on 22 December 1987 gave no support to the construction of the letter contended for by the appellant. Rather, the conversation suggested that a specific site was in contemplation. Her Honour considered Mr Reichstein’s statement “if you do happen to win the licence for that one”, the discussion of the “concept” of utilising two workshops “all in one” for the first 12 months, and the reference to the land going up for auction, implied that a particular “new service station” was in contemplation.
In the result her Honour held that there was no evidence to support a finding of a contract in the terms pleaded by the applicant.
This conclusion rendered it unnecessary to consider the alternative submission on the contract claim that the asserted terms of the contract were so vague as to be unenforceable, but her Honour, nevertheless said that she would not have considered it appropriate to entertain a submission of no case to answer on that basis alone as there was some evidence about standard form contracts in use between the respondent and its franchisees, and some evidence about rental formulae.
As the claim based on the plea of promissory estoppel was dependent on the same evidence led to support the contract claim, her Honour held that the evidence provided no basis for a finding that the respondent, as pleaded in paragraph 13 of the statement of claim, “represented, offered or promised, that upon the Respondent obtaining the right to operate its first Service Station in the Golden Grove area ... the Respondent would grant the site to the applicant” (emphasis added).
Her Honour also held that no evidence had been called by the appellant in an endeavour to establish that the appellant had suffered a detriment by remaining as the franchisee of the Fairview Park premises after January 1988, and that Mr Reichstein’s attendance at the hearing of the licence application to support the respondent’s application for a licence to operate a service station in the Golden Grove area could not be characterised as a detriment suffered by the appellant. Accordingly the two grounds of detriment pleaded in paragraph 16 of the statement of claim failed for lack of evidence to support them.
In support of the appeal it is contended on the appellant’s behalf that the trial judge erred in the following respects:
i) in ruling on the submission of no case to answer without requiring the respondent to elect to call no evidence.
ii) in applying the wrong test in determining the sufficiency of the evidence led by the appellant in support of its claim. Had the correct test been applied it is submitted that the trial judge should have held that there was a case to answer.
iii) in having regard to three affidavits filed on behalf of the respondent in relation to a pre-trial interlocutory injunction application which had been tendered by counsel for the respondent whilst cross-examining Mr Reichstein and marked Exhibit R7, and to other exhibits also tendered by counsel for the respondent during the cross-examination of Mr Reichstein.
iv) in holding that there was no sufficient evidence of detriment.
The respondent sought to uphold the decision of the trial judge. Further, by notice of contention it is submitted that the terms of the contract alleged in paragraph 2 of the statement of claim were so vague as to be unenforceable.
In arguing the first of these contentions, counsel for the appellant acknowledged that her Honour was correct in holding that a trial judge has a discretion whether to require the moving party to elect, but argued that the discretion was one based on principles of case management where considerations of expedient management could come into conflict with the requirements of justice between the parties. As we understood the argument, it was contended that management expediency had been applied in a way that deprived the respondent of justice.
Apart from O.32, r4(4) of the Federal Court Rules which gives a general discretion to the Court to regulate the conduct of the trial, there is no statutory provision or Rule of Court which provides for the procedure to be adopted in the Federal Court in a civil case where a ruling of no case to answer is sought. Section 79 of the Judiciary Act 1903 (Cth) provides that the laws of each State, including the laws relating to procedure shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising Federal jurisdiction in that State in all cases to which they are applicable. Accordingly it was appropriate for the trial judge to pay particular regard to a decision in the Residues Treatment case which discussed decisions on the topic in the Supreme Court of South Australia: see Treharne v Geo. McEwin & Son Pty Ltd (1982) 44 ALR 543. However the judgment of Perry J does not suggest that the practice applied under the general rules of procedure in South Australia differs from that in other States: see the Residues Treatment case at 67-68. The general rule of practice, as the trial judge in this case recognised, is that a decision will not be given on a submission of no case to answer unless the moving party elects to call no evidence: see the Protean case at 238; Trade Practices Commission v George Weston Foods Ltd (No.2) (1980) 43 FLR 55 at 57 and Stevenson v Barham (1977) 136 CLR 190 at 202-203, but these cases hold that the trial judge has a discretion to depart from the general rule where the particular circumstances require it.
In Muller & Co. v Ebbw Vale Steel, Iron & Coal Co. Ltd [1936] 2 All ER 1363 at 1365-6 Branson J said:
“It seems to me that it must be a matter for the judge who is to try the case to decide for himself whether, in the particular case before him, and having regard to all the circumstances of it, it is likely to save the litigants before him expense and time and trouble to deal with the case by way of ruling upon the submission without putting any terms upon counsel upon either side, or whether it is better to say: ‘In this case I think it would be desirable that before I rule I should hear the whole of the evidence.’”
This passage has been cited with approval in later cases: see J-Corp Pty Ltd v Australian Builders Labourers Federated Union of Workers (1992) 111 ALR 377 at 381 (“the J-Corp case”).
In the Protean case at 238 Tadgell J said in relation to whether or not an election should be required:
“In deciding which course to follow the Judge will be guided by the nature of the case, the stage it has reached, the particular issues involved and the evidence that has been given. The imposition of a requirement that the moving party make an election before the Judge entertains the submission, or before he rules on it, will depend on the just and convenient disposition of the litigation.”
Counsel for the appellant directs attention to the observation that the exercise of the discretion depends on the “just and convenient disposition of the litigation”. In the J-Corp case at 380 French J said the discretion fell to be determined “as a matter of judicial case management”, but we do not understand his Honour to have intended any departure from the observations of Tadgell J just cited.
Against the background of these judicial statements, counsel for the appellant took the Court to the decision of the High Court of Australia in Queensland v JL Holdings Ltd (1997) 71 ALJR 294. In a quite different context, Dawson, Gaudron and McHugh JJ at 296 said:
“Case management is not an end in itself. It is an important and useful aid for ensuring the prompt and efficient disposal of litigation. But it ought always to be borne in mind, even in changing times, that the ultimate aim of a court is the attainment of justice and no principle of case management can be allowed to supplant that aim.”
This statement was made in explanation of the following passage from the judgment of Toohey and Gaudron JJ in Sali v SPC Ltd (1993) 67 ALJR 841 at 849 that:
“The contemporary approach to court administration has introduced another element into the equation or, more accurately, has put another consideration onto the scales. (See GSA Industries Pty Ltd v NT Gas Ltd (1990) 24 NSWLR 710). The view that the conduct of litigation is not merely a matter for the parties but is also one for the court and the need to avoid disruptions in the court’s lists with consequent inconvenience to the court and prejudice to the interests of other litigants waiting to be heard are pressing concerns to which a court may have regard.”
The wider public interest considerations mentioned by Toohey and Gaudron JJ are sometimes referred to as “case flow management” to reflect the fact that the particular aspect of management is concerned with the efficient utilisation of limited court resources, the control of court lists, and the interests of litigants in other cases awaiting trial.
In the passages cited above from Muller & Co. v Ebbw Vale Steel, Iron and Coal Co., and the Protean case, and by the reference by French J to judicial case management, attention is being directed not to the wider public interest consideration of case flow management, but to the circumstances of the particular case before the Court. Nonetheless the ultimate aim must be the same, the attainment of justice.
These principles are clear enough. The difficulty in the present case is to identify how it could be said that there has been any departure from them. How or in what manner considerations of convenience may have adversely impinged on the requirement of a just determination of the issues between the parties is not explained by the appellant’s submissions. We are unable to detect anything in the reasons for decision which could suggest that this occurred. Further, the ruling, in the result, has not affected the outcome of the submission of no case. As Tadgell J said in Protean at 238, the fate of the submission of the moving party, once made, is in no sense dependent on election or no election.
It was further contended that the trial judge erred in exercising the discretion not to require the respondent to elect because the respondent “had gone into evidence”. The respondent had not embarked upon its case in defence when the submission of no case was made. However the appellant contends that because several exhibits had been tendered by the respondent in the course of cross-examining the appellant’s witnesses, this fact required the respondent to be put to its election.
No authority was cited in support of this submission, and we can find none in the authorities where the principles relating to the making of a submission of no case to answer are discussed. On the contrary, in the Protean case, Tadgell J, with whose reasons Fullagar J agreed, said at 237 that an invitation to the trial judge to entertain a submission of no case may be made after the moving party has called some but not all of his evidence. It is plain that Tadgell J considered that even where the invitation was made after the moving party had called evidence, the trial judge retained the discretion to entertain the submission without requiring that an election be made.
There is no general rule that requires that a party seeking to make a submission of no case must elect to adduce no further evidence if some evidence has already been led, or if exhibits have been tendered during cross-examination. In a particular case, the fact that the respondent has taken steps of this kind will be one of the circumstances to be taken into account in the exercise of the discretion. In the present case the nature and importance in the case of the respondent’s exhibits, in our view, were of no significance in the exercise of the discretion. The appellant’s submissions are directed to three exhibits. The first is a composite street directory map showing the positions of the several service stations referred to in the appellant’s evidence. Individual street maps, and the addresses of the service stations, had already been put into evidence by the appellant. The composite document produced by the respondent added no new relevant information. Secondly, the respondent tendered a copy of the transcription of the meeting on 22 December 1987 during cross-examination, but an agreed copy of the transcript had already been placed in evidence by the appellant. Thirdly, as part of a cross-examination of Mr Reichstein directed to a question of credit, the three affidavits of officers of the respondent were tendered for the limited purpose of identifying information known to Mr Reichstein at the time when he swore an affidavit for the purpose of the hearing of the application for an interlocutory injunction. The affidavits were not tendered as proof of the facts asserted in them, and they were not referred to by counsel for the respondent in the course of the no case submission. Contrary to the submission made on the appellant’s behalf to this Court, we are satisfied that the affidavits were not part of the evidentiary material relied on by the trial judge when considering and ruling upon the no case submissions.
In written submissions it was suggested that the trial judge had relied on the affidavit material because she asked some questions referring to it in the course of the cross-examination of Mr Reichstein. A reading of the cross-examination however shows that her Honour did no more than rephrase some questions to assist Mr Reichstein in understanding a line of questions by the cross-examiner which he said he found to be confusing. The trial judge was not, in her questions, treating the contents of the affidavits as evidence of the truth of the facts asserted in them, nor is there any suggestion in the reasons for judgment that the affidavits were at any stage treated in this way.
The burden resting on a party who challenges on appeal an exercise of discretion is clear: House v R (1936) 55 CLR 499. It is not enough that the judges comprising the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error of fact or law has been made in the exercise of the discretion. We consider the trial judge correctly identified the relevant principles and was correct in considering that the case fell into the second class of case identified by Perry J in the Residues Treatment case.
The ground of complaint related to the failure of the trial judge to require an election from the respondent fails.
The next ground of complaint is that the trial judge applied the wrong test in determining the sufficiency of the evidence in support of the appellant’s case. Counsel for the appellant contended that the obligation of the trial judge was to consider whether the evidence, taken at its most favourable to the appellant and disregarding evidence to the contrary, could prove the appellant’s case on the balance of probability. Counsel referred the Court to Hocking v Bell (1945) 71 CLR 430 at 442-443 per Latham CJ, Dublin, Wicklow and Wexford Railway Co. v Slattery (1878) 3 App. Cas. 1155 at 1168, and Barker v Charley (1962) 62 SR (NSW) 296. It was submitted that there was evidence that could support a finding that there was a contract, and a representation, offer or promise by the respondent, in the terms alleged in the statement of claim.
The cases referred to concerned civil trials before a judge and jury, and the statements of principle in the judgments must be understood in that context where the trial judge is the arbiter of the law but not of the facts. In civil trials conducted before a judge alone, the judge is arbiter both of the law and the facts, and the principles require modification to reflect that different considerations apply. In Jones v Dunkel (1959) 101 CLR 298 at 330-1, Windeyer J said:
“When there is no jury, the proposition ‘no case to answer’ may obviously mean far more than, ‘is there evidence on which a jury could find for the plaintiff?’ It may mean, ‘would you, the Judge, on the evidence given, find for the plaintiff?’”
In the Protean case Young CJ, with whose reasons Fullagar J agreed, explained the circumstances where the appropriate test would be: “would you, the Judge, on the evidence given, find for the plaintiff”. The learned Chief Justice said, at 215, that where a trial judge sitting alone in a civil case entertains a submission that there is no case to answer without requiring an election any one of three results may ensue. First, the judge may conclude that the evidence could sustain a finding against the party making the submission, in which case the submission would be overruled and the case allowed to proceed. Secondly, the case may be so finely balanced that the judge is not satisfied that even if the evidence could sustain a finding against the party making the submission he or she would be prepared to make the necessary finding, and the case would be allowed to proceed. Thirdly, the result of the submission might be that the judge is persuaded by the submission that there is no case to answer, and upholds it.
In the third situation, Young CJ explained:
“In reaching such a conclusion a trial judge is entitled to draw all proper inferences from the evidence, but he cannot draw inferences against the party making the submission based upon the absence of evidence from that party. Theoretically he then concludes that the evidence could not sustain a finding against the party making the submission. In such a case he upholds the submission. The consequence must then be that judgment must be entered for the party making the submission. His opponent has simply not discharged the burden which rested on him of establishing his case. Where this result ensues there is no room for a distinction between whether the evidence could sustain a finding against the party making the submission and whether the judge would make such a finding. Such a case is covered by the second possible result referred to above. This third possibility is where the proposition ‘no case to answer’ means ‘would you, the Judge, on the evidence given, decide for the party against whom the submission is made’: cf. Jones v Dunkel (1959) 101 CLR 298, at pp.330-1.”
In the Protean case counsel for the appellant argued that the trial judge had wrongly upheld a submission of no case to answer. The trial judge had entertained a submission by the plaintiff in a claim on a fire insurance policy, that the defendant insurer, who carried the burden of proof, had not made out a case to answer on the three grounds of defence asserted by it. The judge did not require the moving party to elect. In his reasons for judgment the trial judge assessed witnesses he had heard and found facts. As to a defence of arson the trial judge said: (see at 218)
“My conclusion is that, as a matter of law, the evidence as it presently stands at the conclusion of the defendant’s case, does not allow an inference or conclusion that Protean lit or connived at the lighting of the fire. If it does I would not draw it.” (Emphasis added)
It was contended that the trial judge had erred in that he “finally decided the issues”. It was submitted that his true function was very special, to decide whether the evidence before him (treating it in the most favourable way to the defendant) permitted the inferences to be drawn in favour of the affirmative defences, and not to decide whether he, as trial judge, should draw those inferences (see at 218). In substance the same argument is now made in this case by counsel for the appellant.
The Full Court of Victoria upheld the decision of the trial judge in the Protean case. Young CJ at 214 said:
“In my opinion, there is no substance in the conclusion of the appellant that the learned Judge erred in ruling upon the submission that Protean had no case to answer in respect of the particular defences by finally deciding the issues. The appellant carried the burden of proving those defences and ex hypothesi all the evidence that the appellant could adduce had been given.”
And Tadgell J at 238-239 referred to three kinds of submission of no case that could be made: (1) that there is no evidence at all in support of the respondent’s case; (2) that although there is some evidence in support of the respondent’s case, the Judge should not act on it, because, for example, it is so unsatisfactory or inherently unreliable or equivocal that he should find that the burden of proof resting on the respondent party has not been discharged; or (3) a combination of (1) and (2). Tadgell J said:
“If a judge sitting alone receives a submission of the second kind and decides to rule on it, whether the moving party is put to or makes his election or not, he must be entitled in doing so to assess the quality of the evidence. Were it otherwise the Judge, being the tribunal of fact, would be placed in an impossible position: he would have to assess the validity of the case for the respondent party without being able to assess the worth or weight of the evidence led in support of it. It has been said that ‘when there is no jury, the proposition ‘no case to answer’ may obviously mean far more than, ‘is there evidence on which a jury could find for the plaintiff?’ It may mean, ‘would you, the Judge, on the evidence given, find for the plaintiff?’’: Jones v Dunkel (1959) 101 CLR 298, at pp.330-331, per Windeyer J. If it falls to the Judge to decide whether he could find for the respondent party on the evidence so far led, it is quite unrealistic to expect him to do so without being able to consider all questions which bear on the sufficiency of the evidence and without power to draw or to decline to draw all inferences from the evidence given on which the respondent party might seek to rely. Moreover (or perhaps this is no more than another aspect of the same view) the Judge, being also the arbiter of the law, could not sensibly be required, in considering a submission of the second kind, to say whether the evidence could establish the case in favour of which it was adduced while shutting his mind to the question of its sufficiency in terms of quality. It might be possible to achieve such a measure of detachment in a clear case but in most or very many cases it would not.”
The respondent’s submissions to the trial judge were of the first kind, rather than the second kind identified by Tadgell J. Nevertheless, the last three sentences from the above passage from Tadgell J’s judgment are applicable to the task which the trial judge was required to perform. As the critical evidence on which the appellant relied was agreed, i.e. the conversation of 22 December 1987 and the letter of 28 January 1988, it was not necessary for the trial judge to embark on a consideration of its reliability, although had this been necessary the Protean case recognises that there are circumstances where it is proper - indeed necessary - for a trial judge to do so.
In the present case the respondent’s submission was that the evidence did not give rise to the inferences of fact alleged by the appellant. It was entirely appropriate for the trial judge to decide what inferences she would draw from the evidence, and to act on her conclusions to finally determine issues in the case.
In our opinion the trial judge did not err in her approach, or in the test of sufficiency of the evidence, when deciding the submission that there was no case to answer. In a case like this, the function to be performed by a trial judge sitting without a jury who has decided to entertain a no case submission is no different from that which has to be performed by a judge who has heard all the evidence of the parties in the ordinary way and who has to give final judgment. In both situations, the judge must make findings of fact, after assessing the quality of the evidence. Consequently, when there is a challenge on appeal to the conclusions of fact arrived at by a judge in disposing of a no case submission, the approach of the appeal court should be the same as that taken to appeals against findings of fact made by a judge who has given final judgment in the ordinary way, a matter recently dealt with in News Limited v Australian Rugby Football League Limited (1996) 64 FCR 410 at 423-434. In our opinion the inferences drawn by the trial judge from the conversation and the terms of the letter were open to her, and have not been shown on this appeal to be wrong. It follows, from the conclusion of the trial judge that the contract (if there were one) and the representations made by the respondent were specific to a site then in contemplation by the parties, that the appellant’s claims as pleaded must fail, and that judgment dismissing the claims was correctly entered. As the grounds of appeal challenging this result have not been made out, the appeal must fail.
We would observe that the making of a no case submission should not be seen as a standard step in litigation. In many cases, it will be an inappropriate interruption to the ordinary method of determining an action, which is by judgment after trial of the issues. Here, however, the procedure was appropriate since, in the words of Tadgell J already referred to, it did “carry the prospect of justly facilitating the disposition of the litigation”: the applicant’s case depended on the inferences to be drawn from and findings to be made on the basis of certain correspondence and a taped conversation in respect of which there was an agreed transcript in evidence.
It is not necessary to consider the remaining ground of appeal relating to her Honour’s conclusions on the question of detriment, or the notice of contention.
The appeal is dismissed, with costs.
I certify that this and the preceding pages are a true copy of the Reasons for Judgment of the Court.
Associate:
Dated:
Counsel for the applicant : Mr RWR Parker QC with Mr BJ Tremaine
Solicitor for the applicant : BJ Tremaine
Counsel for the respondent : Mr J Middleton QC with Mr S Wisking
Solicitors for the respondent : Finlaysons
Date of hearing : 7 May 1997
