FEDERAL COURT OF AUSTRALIA

Martin v NRMA Insurance Limited [2000] FCA 773

AUSTRALIAN CAPITAL TERRITORY)

PRACTICE & PROCEDURE                ) – summary judgment – Court’s discretion to refuse – whether applicant for summary judgment could refuse to be cross-examined, the respondent not having filed an affidavit – whether the applicant’s affidavit showed personal knowledge –rule that summary judgment is for cases where it is absolutely clear there is no case to be tried.

Supreme Court Rules (ACT), Order 15 r 1

Caddy v Beattie [1908] VLR 17, followed

Fancourt v Mercantile Credits Limited (1983) 154 CLR 87, applied

ANTHONY GILBERT MARTIN v NRMA INSURANCE LIMITED

A 6 of 2000

WILCOX, BURCHETT AND MARSHALL JJ

18 MAY 2000

CANBERRA

ON APPEAL FROM THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

EX TEMPORE REASONS FOR JUDGMENT

1                     WILCOX J:   Mr Stevenson, we have decided we do not need to trouble you.  Burchett J will deliver the judgment of the Court.

2                     BURCHETT J:   This is an application by Anthony Gilbert Martin for leave to appeal from a judgment of Miles CJ, the Chief Justice of the Supreme Court of the Australian Capital Territory.  Miles CJ dismissed an appeal from orders which had been made by a Master of the Supreme Court.  The Master had earlier dismissed an application by Mr Martin for summary judgment against the respondent, NRMA Insurance Limited (NRMA).  Mr Martin is the plaintiff in a proceeding before the Supreme Court in which NRMA is the defendant. In that proceeding, Mr Martin has alleged that NRMA is indebted to him in at least the sum of $331,845.86 as a result of its conduct in selling certain property formerly owned by Individual Homes Pty Limited, in respect of which Mr Martin claims to have acquired an interest.

3                     By notice of motion dated 31 August 1999, Mr Martin sought an order that leave be granted to the plaintiff to sign judgment for the sum of $331,845.86 and interest, pursuant to s 53A of the (Australian Capital Territory) Supreme Court Act 1933 (Cwth), against the defendant.  On 16 August 1999, Mr Martin had filed a further amended statement of claim.  In his affidavit in support of his notice of motion, he sought to rely on various previous affidavits filed by him in the proceeding, as far back as August 1988. Paragraph 5 of the affidavit was in the following terms: 

“The deponent verily believes that the defendant has no defence to item 27 of the said Further Amended Statement of Claim.”

Paragraph 27 of the further amended statement of claim alleges that, from the proceeds of sale of the defendant's exercise of its mortgagee’s power of sale of the twelve units, the plaintiff is entitled to be paid the sum of $331,845.86. 

4                     The motion came before the Master on 26 November 1999.  Mr Martin contended that summary judgment should be ordered as NRMA had not filed any answering affidavit to oppose his motion.  He specifically declined to make any point about the defence to the further amended statement of claim being delivered one day late.  Counsel for NRMA then sought to cross-examine Mr Martin. Mr Martin declined to present himself for cross-examination, on the ground that an affidavit in opposition had not been filed.  The Master held that, in the circumstances, Mr Martin ought not to be permitted to rely on his affidavit; and, as there was then no supporting evidence in favour of the motion, the motion was dismissed. 

5                     Mr Martin appealed to a judge of the Supreme Court, and his appeal was heard by Miles CJ.  Miles CJ made it clear that he did not agree with the precise manner in which the Master had dealt with the issue of cross-examination, but he said:

“It is impossible to isolate out what is in the deponent's knowledge and what is outside the deponent's knowledge and is relied upon by way of hearsay” -

that is, in the affidavit filed by Mr Martin in support of his application for summary judgment.  His Honour went on to say:

“In the past applications for summary judgment were restricted in the main to claims for debt.  Since the 1997 amendments such restrictions are no longer necessary.  At the same time it remains true that in actions for unliquidated damages, like the present application, summary judgments should be granted only in the clearest of cases. 

I am of the view that the affidavit sworn on 31 August 1999, which accompanied the application for summary judgment, does not satisfy the requirements of O 15 r 1(3) in that it does not adduce evidence of the source of information of items of hearsay evidence, nor does it state that the defendant believes the information.  If I am wrong in that regard, I think that the prolix nature of that affidavit and the earlier affidavits upon which the deponent purports to rely is further discretionary ground to justify refusing the application for summary judgment. 

In my view, the Master was correct in dismissing the motion dated 31 August 1999, which sought an order for summary judgment.”

6                     The reasoning in the passage just quoted from the judgment of the Chief Justice upholding his decision is supported by case law, and in particular by the judgment of Cussen J in Caddy v Beattie [1908] VLR 17.  The rule with which that case was concerned was not in identical terms, but it was to substantially the same effect.  Cussen J (at pages 18 and 19) said he thought it should appear that the person who swears the affidavit can swear positively to the facts: 

“There are some matters which might appear in an affidavit for which you could judge that the deponent could speak positively from his own knowledge.”  

His Honour went on:

“One is the illustration -

which had been given by counsel in argument -

where a person swears to a conversation between himself and another person.  It would be idle to add to that – ‘I am speaking of this fact from my own knowledge.’  But where it does not appear from the facts themselves that he is speaking from his own knowledge, I think there should be something to show that he is so speaking.  Here we have an affidavit as to a mortgage entered into in 1893, and it is alleged to have been assigned to the plaintiffs in 1905.  In the meanwhile a number of charges have been made for interest, and at all events during the last few years a number of credits are given in respect of the sale of various properties -  I presume properties under the mortgage - and credits are also given for rents received; and I suppose that, in connection with these sales, there were expenses incurred. Therefore I think that the defendant's solicitor had good ground for saying that in his opinion the plaintiff was not speaking from his own knowledge in swearing his affidavit, and in addition the plaintiff is not willing to be cross-examined on his affidavit.  I think that in these circumstances I should refuse to make an order for final judgment.”

It hardly needs to be added that the circumstances of which Cussen J was speaking were remarkably similar, though obviously not identical, to the circumstances of the present case. 

7                     Cussen J proceeded (at page 20) to say:

“It has always been considered necessary in applications under -

and he referred to the summary judgment order with which he was concerned -

that the jurisdiction should be exercised with great care, and I am not disposed to exercise it in this case.”

That is plainly the language of discretion.  His Honour continued:

“It is to be remembered that I have no jurisdiction to enter judgment in this way unless the conditions precedent provided for in the first clause of [the order and rule] are complied with.  If they are complied with - when it does appear that there is a debt or liquidated demand, and there is an affidavit in compliance with that clause - then I can enter judgment.” 

Again, those words clearly speak of a discretion.  And finally, his Honour concluded:

“But if the necessary conditions precedent are not complied with, I cannot enter final judgment.”

8                     It is very important to recognise that the Court does have a discretion, and to remember that, in more recent authority, such as the decision of the High Court in Fancourt v Mercantile Credits Limited (1983) 154 CLR 87, the Court has been required to refrain from exercising that discretion in favour of entering a summary judgment, except in the very clearest of cases.  For two reasons, each of which would be sufficient if standing alone, the decision of Miles CJ appears clearly correct.  (1)  The affidavit did not in strictness verify within the meaning of the rule, because the verification, which was required, did not clearly distinguish between personal knowledge and knowledge gained otherwise.  (2)  The case did involve considerable complexities and room for dispute, so that it was appropriate to exercise the discretion against entering judgment.

9                     Reference has been made to the discretion as evidenced by the judgment of Cussen J.  For completeness, it should be added that Order 15 rule 1(3A) of the Supreme Court Rules, here in question, explicitly uses the word "may" in a context in which it clearly confers a discretion.   It is very important to emphasise that the discretion is always retained by the Court to refuse summary judgment, so that both parties will have the benefit of a full and fair trial, to which in the normal course they are both entitled.  The Court should refuse to enter summary judgment unless it is absolutely clear there is no case to be tried.  That is the issue to which the rule is directed.  And that is the way in which the discretion is required to be exercised by the High Court in Fancourt.

10                  The decision of Miles CJ is an interlocutory one involving a discretion, and the order the Court should make is that leave to appeal be refused.

11                  WILCOX J:   Yes, well, the order of the Court will be that the application for leave to appeal will be dismissed and that the applicant pay the respondent's cost of the application.

Associate:

Dated:              8 June 2000