398 Investment Pty Ltd v The Monopoly Company Pty Ltd

1. [1]

   Monopoly is the leaseholder of the Stardust Hotel at Cabramatta. In 2024 it entered a written licence agreement with 398, which operated a Chinese restaurant at the Hotel. Monopoly took possession of the restaurant in March 2025, where plant and equipment owned by 398 was left behind, when it vacated. Monopoly later refused 398’s demands that it be given access to the premises to remove its plant and equipment, relying on terms of the licence agreement which regulated such a situation.

2. [2]

   398 brought these proceedings in April 2025, seeking a declaration that it was the owner of personal property specified in Annexure A to its statement of claim. Although the statement of claim filed did not contain such an annexure. In the alternative, 398 claimed it had the better right to possession of that property, which it sought to obtain from Monopoly. Alternatively, it also sought orders for unspecified damages.

3. [3]

   398’s claims were defended, Monopoly relying on the express terms of the licence agreement. Its defence including that the agreement had the effect that if 398 did not remove its plant and equipment before the determination of the licence, they became Monopoly’s property.

4. [4]

   In June 2025, Monopoly also brought a cross-claim, seeking liquidated damages of $107,243.75 under the licence agreement, for invoices in respect of outgoings which it claimed 398 had been obliged by the agreement to pay. The cross-claim was also defended, 398 denying that it had received the invoices.

5. [5]

   398 amended its statement of claim in August, to which Annexure A was attached. It still there sought declaratory relief. It was then given leave to file a further amended statement of claim, which it filed in September, but still a declaration was pursued. That pleading was never further amended, despite being described at the April 2026 hearing by 398’s counsel as frankly making no sense. That shedding light on the unlikelihood of 398 establishing its case at the hearing, it also not having served evidence to establish its ownership of the property, or its claimed value.

6. [6]

   It was in November 2025 that the matter had been listed for hearing in April 2026. Despite orders made for the preparation of the matter for that hearing, 398 never complied with them. Monopoly, by way of contrast, had served its evidence on the cross-claim in October. Still 398 has never served any evidence, either to establish its own claim or to defend the cross-claim.

7. [7]

   The reason for these failures has not been adequately explained.

8. [8]

   It was only the week before the April hearing that 398 filed a motion seeking leave to discontinue. Monopoly not having consented to the discontinuance, the result was that 398 required the Court’s leave: Uniform Civil Procedure Rules 2005 (NSW), r 12.1. The motion was supported by an affidavit sworn by its solicitor, Mr Wallman. But it did not explain 389’s failure to comply with the Court’s orders, or the course it had pursued, with the result the belated application for leave to discontinue.

9. [9]

   It emerged at the hearing that in December 2025, 398 had retained new solicitors and on 10 December had proposed the vacation of the hearing and transfer of the proceedings to the District Court. That was not consented to by Monopoly, given the course which the proceedings had already taken.

10. [10]

    Despite this, 398 still did not comply with the Court’s orders; seek to further amend its statement of claim; approach the Court to have its orders varied; file a motion to have the proceedings transferred to another Court; or seek to have the April 2026 hearing vacated or adjourned.

11. [11]

    It was only on 26 March 2026 that 398 advised Monopoly that it wished to discontinue the proceedings. While that was also not consented to, the parties pursued further discussions, including at the April hearing.

12. [12]

    Rule 12.1 permitted the filing of the motion, so that 398 could pursue the Court’s leave to discontinue. For the purpose of that rule the proceedings on the cross-claim were “taken to be different proceedings to the proceedings on the originating process and to proceedings on any other cross-claim.”: r 12.5.

13. [13]

    The result was that the motion was also listed for hearing on 9 April. The parties being advised that because both 398’s claim and the cross-claim were both listed for hearing, even if the motion was successful, the cross-claim would be heard. Still, 398 took no steps to seek to put on any evidence to resist the cross-claim, or to advance its claims, in the event that the leave to discontinue which it required was refused.

14. [14]

    At the hearing 398 pressed its motion, understanding that Monopoly would then pursue the cross-claim. But finally, a large measure of agreement was reached, with the result that various orders were made by consent and the parties heard about the one order which remained in issue between them.

The issue

1. [15]

   The approach which the parties so pursued was consistent with the obligations imposed on them by s 56 of the Civil Procedure Act 2005 (NSW). With the result that they finally agreed that the Court should grant both of them leave to discontinue, with a costs order made against 398. But they could not agree about the pursuit of their claims in future proceedings.

2. [16]

   The orders pressed by Monopoly were:

3. [17]

   Order 4 reflected the parties’ agreement that 398 should pay Monopoly’s costs on an indemnity basis. That reflecting an acceptance of its misconduct in the proceedings, of the kind explained in Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11.

4. [18]

   Only order 3 was thus finally in issue. With the other orders being made by consent and the parties then heard on the disputed order.

5. [19]

   There was no issue about the Court’s power to make that order. But the exercise of its discretion, which Monopoly pressed, was resisted by 398. What is in issue has to be decided in the context of what justice requires.

The course the parties pursued

1. [20]

   The course which the parties each pursued is relevant to the exercise of the Court’s discretion to make the disputed order.

2. [21]

   Both parties having made forensic decisions which resulted in them both being granted leave to discontinue. The result being that neither had their claims heard on their merits. An opportunity of which parties will not lightly be deprived.

3. [22]

   Decisions made by 398 also resulted in its unremedied, unexplained breaches of the Court’s orders, that amounting to relevant misconduct in the proceedings. It having neither served the evidence ordered to establish its claims or to resist Monopoly’s, nor led evidence to explain the course it had pursued, other than in relation to its belated decision to pursue a discontinuance.

4. [23]

   Those that Monopoly made resulting in it not pursuing its cross-claim at the April hearing, despite it being ready to be heard and 398 having led no evidence to resist the evidence Monopoly had served.

5. [24]

   Those decisions have to be understood in circumstances where, had the measure of agreement which the parties reached during the hearing not been achieved, it is likely that 398’s motion would have failed, and the hearing of both its claim and the cross-claim would have proceeded. The Court being required to do justice between these parties: Civil Procedure Act, ss 57 and 58.

6. [25]

   398’s claim is then likely to have failed, it having no evidence on which to even establish its claimed ownership of the property.

7. [26]

   It is also not apparent how 398 could then have successfully defended the cross-claim, given that it had also not served any evidence to put in issue that which Monopoly had served about the invoices on which its cross-claim rested.

8. [27]

   Given what Monopoly agreed at the hearing it must, I consider, be inferred that it then either took the view that its prospects of success on the cross-claim were not certain, or that given the costs involved, settlement was a preferable outcome to the pursuit of the defended hearing.

Why the disputed term must be imposed

1. [28]

   As a result of what was agreed, all that remained to be resolved was whether justice permits the disputed order being imposed on the parties, in all of the circumstances which arise to be considered.

2. [29]

   It was properly not suggested by 398 that what was in issue between the parties inevitably had to result in the refusal of the disputed order.

3. [30]

   398 relied on the undoubted consequence of the orders, to which the parties had consented, being that their claims had not been determined on the merits. And the Court having the discretion not to make the disputed order, in those circumstances.

4. [31]

   398 also relied on s 91 of the Civil Procedure Act and r 12.3 of the Uniform Civil Procedure Rules to contend that the “orthodox” position was that discontinuance does not inherently bar future litigation on the same claim, unless specific conditions are imposed by the Court. As well as on r 42, under which 398 contended the consequence of late discontinuance is usually a costs order. Relying on the costs order the parties had agreed, to urge that it should not also be deprived of a further opportunity to press its claim in relation to the disputed property.

5. [32]

   398 relying on Dennis G. Pamplin Pty Limited atf the Dennis G Pamplin Family Trust v Ann Margaret Irwin in her capacity & as administratrix of the estate of the late Adrian Dennis Pamplin [2025] NSWSC 270, which applied Australian International Academy of Education Inc v The Hills Shire Council [2011] NSWLEC 208.

6. [33]

   Monopoly contended that the disputed order should be made, despite the merits of the two claims not having been determined, given the course 398 had pursued in the proceedings; the circumstances in which it had so belatedly pursued discontinuance; and what had finally been agreed at the hearing.

7. [34]

   On Monopoly’s approach, even if it could be assumed that 398’s claim had some prospect of success, despite the clear term of the licence agreement, it had no evidence to establish its claimed right to the property, 398 would thus have failed at the hearing had it not consented to the discontinuance.

8. [35]

   Given the agreement which had been reached, to also permit substantial additional costs to be incurred by a further pursuit of 398’s thus far unsubstantiated claims, would not be just in all of the circumstances which had to be considered. While making the disputed order accorded with the requirements of the Civil Procedure Act.

9. [36]

   It is s 61(1) of the Civil Procedure Act which regulates the orders and directions which the Court may give for the “the speedy determination of the real issues between the parties to the proceedings”. It is s 61(3) which specifies what the Court may do if a party fails to comply. That including not only orders dismissing the proceedings, striking out or limiting a claim, but also making other orders the Court concludes are appropriate.

10. [37]

    It is not disputed that they may include imposing the disputed order, as a condition of the grant of leave to discontinue.

11. [38]

    Section 91(1) of the Act deals with dismissal of proceedings, which “does not, subject to the terms on which any order for dismissal was made, prevent the plaintiff from bringing fresh proceedings or claiming the same relief in fresh proceedings”. These proceedings were, however, not dismissed.

12. [39]

    It is r 12.3(1) which provides that a discontinuance does not prevent “a plaintiff from claiming the same relief in fresh proceedings”. But that it is subject to the terms of any consent or leave to discontinue which the Court imposes: r 12.3(2).

13. [40]

    In Australian International Academy of Education, Biscoe J explained that a term of the kind here in issue may be imposed, the underlying principle being “that defendants and the courts are entitled not to be repeatedly troubled by identical claims unless strong countervailing considerations of justice demand it”: at [13]. Examples of when such an opportunity is given being the emergence of evidence which was unobtainable, or a new precedent.

14. [41]

    The case 398 pressed relied on it not having had its claims determined on the merits and the costs order which the parties agreed as a term of the discontinuance.

15. [42]

    That 398’s claims have not been dealt with on their merits is a relevant, but not overwhelming, consideration. Given that the Court unquestionably has the discretion to make the disputed order, even when parties have not been heard on the merits of their claims.

16. [43]

    It is relevant that it is settled that “Normally, if a discontinuance is sought after the commencement of a hearing, there will be a term imposed that no new proceedings of the same character will be brought”: Malaysian Airlines Australia v Patel [2011] NSWCA 339 at [2].

17. [44]

    In this case, the motion was brought shortly before the hearing. The parties’ discussions resulting in the hearing of the competing claims finally not having to commence, because of the compromise which the parties arrived at during the hearing of the motion. Despite Monopoly having initially indicated that it wished to proceed with the hearing of its cross-claim.

18. [45]

    That agreement removed the necessity for the Court to determine 398’s motion. Given the very limited evidence it relied on to support its application for leave to discontinue, that there could have been a just basis established for the grant of the required leave is not apparent. It follows that if agreement had not been reached, the hearing of both 389’s claim and the cross claim would likely have proceeded.

19. [46]

    What remains in dispute, given what was agreed and the resulting consent orders made, has to be resolved in light of the Court’s obligation to seek to give effect to the overriding purpose of the Civil Procedure Act and of the rules. That is specified in s 56 to be “to facilitate the just, quick and cheap resolution of the real issues in the proceedings”.

20. [47]

    Section 56(3) imposing a duty on parties “to assist the court to further the overriding purpose and, to that effect, to participate in the processes of the court and to comply with directions and orders of the court”. It is relevant that 398 did not comply with this obligation, while Monopoly did.

21. [48]

    Section 57 specifies the objects to which the Court is to have regard, when managing proceedings for the purpose of furthering that purpose, to be:

22. [49]

    The object of a just determination of the proceeding does not overwhelm the other specified objects to which attention must be given when resolving what is in dispute. They, I consider, favour the making of the disputed order. The Court must also follow what the dictates of justice require, having regard to the overriding purpose, as well as what is specified in s 58(2)(b), which the Court finds relevant:

23. [50]

    These requirements are statutorily compulsory, imposing considerations that are relevant in the sense discussed in Minister for Aboriginal Affairs v Peko-Wallsend Limited (1986) 162 CLR 24; [1986] HCA 40. That requiring them to be taken into account when consideration is given to the exercise of powers given by s 61(3): Hans Pet Constructions Pty Limited v Cassar [2009] NSWCA 230 at [36]-[40]. In this case all the matters specified by s 58(2)(b) are relevant and must be taken into account.

24. [51]

    The statutory requirement to “have regard to” the matters specified in s 58(2) requiring the Court to give them “weight as a fundamental element in the decision-making process”: Hans Pet Constructions at [41], applying R v Hunt; Ex parte Sean Investments Pty Ltd (1979) 180 CLR 322 at 329; [1979] HCA 32; R v Toohey; Ex parte Meneling Station Pty Ltd (1982) 158 CLR 327 at 333, 337-338; [1982] HCA 69.

25. [52]

    The proportional use of the s 61 powers being “brought about by giving the fundamental weight to the (sometimes competing) considerations in ss 56 and 57 required by s 58(2)(a) and bringing to bear such of the matters set out in s 58(2)(b) as the Tribunal thinks appropriate”: Hans Pet Constructions at [46].

26. [53]

    In this case, consideration must thus be given to the undoubted fact that 398 did not abide by its s 56(3) duty, before it filed its motion. It having not complied with the Court’s orders, which did not involve the mere setting of a procedural timetable for the preparation of the matter for the April hearing. But rather imposing obligations which the parties were both bound to comply with, unless relieved of them, including as to service of their evidence.

27. [54]

    That 398 failed to make any application, as it could have, to have those orders set aside or varied, for reasons which were not explained, thus cannot be overlooked. That is what drove the parties’ cost agreement.

28. [55]

    It also has to be borne in mind that a party like 398 has no inherent right to procedural flexibility and indulgence. Only a right to the proper exercise of the Court’s discretions: Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175; [2009] HCA 27 at [96], [111]. 398 never sought their exercise, after it breached the Court’s orders, until it sought leave to discontinue.

29. [56]

    It may also not be overlooked that the Court is also required to implement its practice and procedure “with the object of eliminating any lapse of time between the commencement of the proceedings and their final determination beyond that reasonably required for the interlocutory activities necessary for the fair and just determination of the issues in dispute between the parties and the preparation of the case for trial”: s 59.

30. [57]

    There can be no question that 398 was given the time it reasonably required to prepare for the April hearing, where it had the opportunity to pursue the fair and just determination of the issues in dispute over its claim. Why it did not take advantage of that opportunity, is unclear.

31. [58]

    The Court must also implement its practice and procedure “with the object of resolving the issues between the parties in such a way that the cost to the parties is proportionate to the importance and complexity of the subject matter in dispute”: s 60.

32. [59]

    Making the disputed order would, I consider, help achieve these goals. While refusing to make it would, in the circumstances, fail to take proper account of the requirements of s 58 and result in the objects specified in s 57 being undermined.

33. [60]

    The parties’ competing cases also raise for consideration the practical effect of the course which 398 seeks to pursue. Its motion having been pursued in order to achieve the vacation of the hearing of its claims, which it did not seek before or at the April hearing and could not then justly have been granted, without Monopoly’s agreement. It having no good explanation to advance for its failure to prepare for the hearing, that not being explained by new solicitors having been retained in 2025.

34. [61]

    The outcome 398 sought by discontinuing these proceedings, to allow it to again reformulate its claims and marshal the evidence which would prove them, so that they could later be pursued in another court, was still contended not to be unjust, because Monopoly would be protected by principles regulating abuse of process and security for costs. That is difficult to accept and fails to pay necessary regard to the obligations imposed by the Civil Procedure Act, to which the Court must pay attention, in resolving what is in issue.

35. [62]

    A transfer to another court had been proposed by 398 in December 2025, but that was not consented to by Monopoly. 398 still did not abandon its pursuit of declaratory relief by further amendment of its September statement of claim. Despite recognising that its pleading was deficient.

36. [63]

    I took an adjournment during the course of the hearing to give the parties the opportunity to resolve their differences, which did not result in further agreement. That followed Monopoly’s assessment that the property 398 pursued might have a value of just beyond, or less than $125,000, while the amount which Monopoly pursued was some $107,000.

37. [64]

    398 did not accept Monopoly’s assessment, even though it had never led evidence to establish its ownership of the property, let alone its claimed value. It then only accepting that what it pursued was less than the Supreme Court threshold and “probably more a District Court amount”. The District Court threshold is now $1.25 million: District Court Act 1973 (NSW), s 4. The Local Court’s is $100,000 in its General Division: Local Court Act 2007 (NSW), s 29(1)(a).

38. [65]

    398’s resistance of the disputed order has to be considered in this context. The evidence Mr Wallman gave having been confined to the communications pursued with Monopoly’s legal representatives, after 398 made its decision to discontinue these proceedings only in March 2026.

39. [66]

    It follows that 398’s failures to comply with the Court’s orders; to have the proceedings promptly relisted when it became apparent that it could not comply with them; to seek leave to replead; to seek to have the matter transferred to another court with appropriate jurisdiction; to seek to have the April hearing adjourned or vacated; and its delay in notifying Monopoly of the course it belatedly decided to pursue by discontinuing the proceedings, all do not support its resistance of the disputed order.

40. [67]

    In resolving what is in issue, the Court also cannot overlook the observations in Aon at [5], that “[T]here is an irreparable element of unfair prejudice in unnecessarily delaying proceedings. Moreover, the time of the court is a publicly funded resource. Inefficiencies in the use of that resource, arising from the vacation or adjournment of trials, are to be taken into account.”

41. [68]

    In this case 398 did not pursue an adjournment, but rather discontinuance, so that it could have an opportunity to commence afresh, replead and put its case in order, likely in some other court. Despite not having explained the course it has pursued in these proceedings, as it ought to have.

42. [69]

    That also makes it necessary to consider “the potential for loss of public confidence in the legal system which arises where a court is seen to accede to applications made without adequate explanation or justification, whether they be for adjournment, for amendments giving rise to adjournment, or for vacation of fixed trial dates resulting in the resetting of interlocutory processes.”: Aon at [30].

43. [70]

    Those observations apply with equal force to discontinuance of proceedings in circumstances of the kind which here arose to be considered. When adjournment or vacation of hearing was unlikely to be granted and leave to discontinue was sought instead.

44. [71]

    It is thus also relevant that if 398 had been refused leave to discontinue, as it is likely to have been if agreement on the motion had not been reached, the result would have been that the hearing of both its claims and the cross-claim would have proceeded. With the likely result that 389’s claims would have failed. It having no evidence to advance to support even its claimed ownership of the disputed property, let alone its value.

45. [72]

    That result would then likely have triggered s 91(2) of the Civil Procedure Act, which would have prevented 389’s further pursuit of its claims, its case having failed on the merits.

46. [73]

    The agreement which the parties finally reached, in those circumstances, clearly accorded with the obligations which s 56 imposed on them. It having saved court time and unnecessary costs, as it did. But I consider that 398’s resistance of the disputed order did not.

47. [74]

    In all of the circumstances which have to be considered, I have concluded that making the disputed order would accord with what the dictates of justice require. Despite that depriving 398 of yet a further opportunity to pursue its claims against Monopoly. Given how it sat on its hands as it did, I am not persuaded that this outcome is unjust, particularly given that what the parties agreed will not leave it exposed to Monopoly’s further pursuit of the cross-claim.

48. [75]

    I have taken into account that the parties have already incurred significant legal costs which they have agreed 398 must pay. That reflecting how 398 brought its claim in this Court because of the declaratory relief which it pursued and never abandoned, as it seems on its own approach, it should have, in its amended pleadings. As well as 389 never having complied with the Court’s orders to serve its evidence and also not having explained its breaches of those orders.

49. [76]

    Despite which, 398 still wishes to maintain the right to put Monopoly to further significant costs, it appears by pursuit of its claims in another court, where further judicial and administrative resources will also have to be utilised.

50. [77]

    The degree of injustice to 398 if the disputed order is made has to be contrasted with the injustice to Monopoly, if it is not. That also requires account to be taken of the intangible prejudice which can arise from the pursuit of litigation by the way it is conducted. On 398’s part, clearly not in accordance with the obligations imposed on it by s 56 of the Civil Procedure Act.

51. [78]

    When that is taken into account, it is difficult to accept that the degree of injustice which 389 would suffer if the disputed order is made, can justly result in its refusal, especially when account is taken of what Monopoly has also agreed to give up.

52. [79]

    There can be no question that 398, always legally represented, has had a fair opportunity to pursue the claims it brought in respect of the disputed property at the April 2026 hearing, which the Court had regularly fixed. It made no application to vacate or adjourn that hearing, for which it had ample time to prepare.

53. [80]

    Having belatedly decided not to pursue its claims at the hearing, it having not explained why it did not serve evidence, even to establish its claimed ownership of the disputed property, it cannot be accepted that 398 is justly entitled to be given yet another opportunity to reformulate its claims and marshal its evidence, simply because of the costs order which the parties agreed. That would not result in the timely disposal of its claims, at an affordable cost.

54. [81]

    Monopoly accepted that the price of the disputed order it pressed also required it to give up the pursuit of its cross-claim, which it was ready to press at the hearing. That also supports the conclusion that the disputed order should be made.

55. [82]

    This, I consider, achieves in all of the circumstances which have to be considered, a just outcome between these parties. Despite, as a result, 398 not having its claim heard on its merits. An opportunity which it undoubtedly had, but did not pursue, at the hearing.

56. [83]

    The Court cannot force parties to avail themselves of a fair opportunity to prepare for and have their cases heard. But it must consider and deal with the consequences when parties fail to take advantage of such a hearing, if the required justice is to be done to all those who choose to litigate before it. Particularly when no adequate explanation is provided for unremedied breaches of the Court’s orders.

57. [84]

    What 398 relied on, I am satisfied, cannot be accepted as providing a just basis for refusing to make the disputed order which Monopoly pressed the Court to impose as a condition of the leave to discontinue which it granted, given the terms the parties had otherwise agreed. All of the other circumstances which have to be considered in resolving the dispute over that order establishing, as I have explained, a just basis for the exercise of the Court’s discretion to make the disputed order.

Orders

1. [85]

   For these reasons I further order that neither party may commence fresh proceedings seeking relief in respect of the matters and issues raised in these proceedings.