Muriniti v Lawcover Insurance Pty Ltd

1. [1]

   THE COURT: The applicants seek leave to appeal from a judgment and orders dated 11 February 2022 (Muriniti v Lawcover Insurance Pty Ltd [2022] NSWSC 90). Ward CJ in Eq summarily dismissed the proceeding and ordered the applicants to pay the respondents’ costs. Her Honour also dismissed the applicants’ notice of motion in which they sought a temporary stay of the proceeding (or, alternatively, leave to amend the statement of claim).

2. [2]

   The current application, which is opposed, is the latest chapter in what has been a remarkably lengthy history of litigation involving the applicants. That history, which we will briefly outline below, calls to mind the following extra-curial observations of Gleeson CJ about the importance of finality in litigation (emphasis added):

3. [3]

   Having regard to those observations, it is noteworthy that the concept of abuse of process was the basis for the primary judge’s summary dismissal decision.

Earlier litigation – The Young litigation and the De Costi proceedings

1. [4]

   There are two separate series of litigation which should be described briefly at the outset because they feature heavily in the applicants’ allegation of conspiracy.

2. [5]

   They may conveniently be described respectively as the Young litigation and the De Costi proceedings.

3. [6]

   The applicants (who are both legal practitioners) did not become involved in the Young litigation until 2008. The litigation arose from a neighbourhood drainage dispute between Mrs Young and her neighbours, Mr and Mrs King. Mrs Young commenced the proceedings in the Land and Environment Court (LEC) in 2003. The dispute was initially resolved by consent orders made by McClellan CJ of LEC in Young v King [2004] NSWLEC 93. In May 2008, Mrs Young, who by then was represented by the applicants, applied to have the consent orders set aside based on what she claimed was new evidence which established that the consent orders were procured improperly.

4. [7]

   As the primary judge in the present proceeding noted at PJ [60], the 2008 LEC application “spawned a veritable barrage of litigation”. This comprised no less than 14 judgments of the LEC and subsequent appeals.

5. [8]

   In 2010, related proceedings were commenced in the Supreme Court by Mrs Young against her former lawyers and engineers who had acted for her in the LEC proceedings. They had advised her regarding entry into the 2004 consent orders, which spawned various conspiracy allegations by Mrs Young. This litigation (which may be described as the Young v Hones litigation) included an appeal to the Court of Appeal (see Young v Hones (No 2) [2014] NSWCA 338) and two unsuccessful special leave applications to the High Court.

6. [9]

   As the primary judge noted at PJ [63], the Young litigation gave rise to a number of judgments in different courts and by different judges, which included criticism of the applicants’ professional conduct. We will return to outline some of those judgments below.

7. [10]

   Mrs Young was ultimately made bankrupt in March 2017 after apparently failing to set aside various bankruptcy notices issued to her by the successful defendants in the Young v Hones litigation. Personal costs orders were made against the applicants arising from their representation of Mrs Young in the Young v King litigation.

8. [11]

   As the primary judge noted at PJ [66], the Young litigation is relevant in two respects. First, the proposed amended statement of claim pleaded that the ultimate purpose of the alleged conspiracy between the respondents was to interfere with the capacity of the applicants to prosecute Mrs Young’s claims and thus impeded the conduct of those claims. Secondly, Mr Newell was the subject of applications for personal costs orders in Mrs Young’s proceedings both prior to and following Suncorp’s decision not to renew his professional indemnity insurance (PII) as a barrister.

9. [12]

   These proceedings were commenced in the District Court in 2006. They involved:

   1. (1)

      the De Costi parties (companies and associated persons);

   2. (2)

      the Wachtenheim parties; and

   3. (3)

      Mr Shnider (brother-in-law to Mr Wachtenheim).

10. [13]

    The applicants in the present proceeding represented the Wachtenheim parties in the De Costi proceedings. The first applicant, Mr Muriniti, is a solicitor and principal in the firm L. C. Muriniti & Associates, Solicitors. The second applicant, Mr Newell, is a former barrister but has since 2014 (from which time he could not renew his PII) worked as a solicitor employed as a consultant for L. C. Muriniti & Associates, Solicitors.

11. [14]

    After several years of litigation, personal costs orders were made against the applicants (De Costi Seafoods (Franchises) Pty Limited v Wachtenheim (No 6) [2016] NSWDC 378). Taylor SC DCJ found that the applicants had engaged in serious neglect, serious incompetence or serious misconduct in conducting the De Costi proceedings. After unsuccessfully challenging most of those findings in the Court of Appeal, declarations were made holding the applicants liable to indemnify the De Costi parties and remitting the matter to the District Court for determination of costs (see Newell; Muriniti v De Costi (2018) 97 NSWLR 398; [2018] NSWCA 49).

12. [15]

    On 20 March 2019, on the remittal, Taylor SC DCJ made orders appointing a referee to assess the alleged wasted costs (the costs reference). The applicants tried to have the costs reference terminated but were unsuccessful (see De Costi Seafoods (Franchises) Pty Limited v Wachtenheim (No 8) [2020] NSWDC 184).

Summary of the decision from which leave to appeal is sought

1. [16]

   The primary judge’s reasons for judgment (PJ) total 521 paragraphs.

2. [17]

   It is desirable first to describe the parties to the proceeding below. As noted above, the applicants are both solicitors. For consistency we will refer to the parties as the applicants and the respondents in this section. Below, they were the plaintiffs and defendants respectively.

3. [18]

   The primary judge described the multiple respondents’ identities at PJ [21]–[53]. For present purposes, it suffices to group the respondents in the following manner (using the same grouping as the primary judge):

   1. (1)

      The 1st, 2nd, 16th and 17th respondents comprised Lawcover Insurance Pty Ltd (the PII insurer of the applicants) and its general counsel; and a principal and employed solicitor of Yeldham Price O’Brien Lusk (YPOL), who were appointed by Lawcover to act in relation to certain applications for personal costs orders sought against the applicants. Collectively, these respondents are the Lawcover/YPOL respondents.

   2. (2)

      The 18th respondent was the senior counsel briefed by YPOL in the matters described immediately above.

   3. (3)

      The 3rd and 21st respondents comprised AAI Limited (formerly known as Suncorp) (the PII insurer of Mr Newell while he practised as a barrister until 2014) and the senior counsel briefed to act for Mr Newell on the personal costs applications that were made against him in his capacity as a barrister. Collectively, these respondents are the Suncorp respondents.

   4. (4)

      The 8th and 11th respondents comprised two solicitors who acted for the De Costi parties in the De Costi proceedings. Collectively, these respondents are the McLachlan Thorpe respondents.

   5. (5)

      The 10th respondent was the junior counsel who acted for the De Costi parties in the De Costi proceedings.

   6. (6)

      The 4th, 5th, 6th, 7th, 9th, 12th and 23rd respondents comprised the De Costi-related parties and one junior counsel who acted for those parties in the De Costi proceedings against the Wachtenheim parties (for whom the applicants acted). Collectively, these respondents are the De Costi respondents.

   7. (7)

      The 13th, 14th and 15th respondents comprised a solicitor and junior counsel who appeared for Mr Shnider in the De Costi proceedings; and Mr Shnider’s trustee in bankruptcy. Collectively, these respondents are the Ms Searle/Trustee Parties.

   8. (8)

      The 19th, 20th and 22nd respondents comprised a principal, employed solicitor, and partner of Barry Nilsson Lawyers, who were appointed by Suncorp to act for Mr Newell on the personal costs applications arising out of Mr Newell’s conduct as a barrister. Collectively, these respondents are the Gadens/New Trustee Lawyers respondents.

4. [19]

   The applicants commenced proceedings by a statement of claim dated 22 April 2020 against the 23 respondents alleging that they concocted an unlawful conspiracy to injure the applicants by use of unlawful means (PJ [7], [126]). That alleged conspiracy was described by her Honour in the following terms (PJ [7]–[8]):

5. [20]

   Although the statement of claim was initially filed on 22 April 2020, the earliest it was served on any respondent was in September 2020, just shy of when it would have become stale (PJ [126]). The applicants submitted to the primary judge that they prepared the pleading at the time they did to avoid any issue about the application of statutory limitations on their claim. However, they also submitted that they were incapable of pleading all the circumstances to support their claim at that time because they did not yet know the outcome of the costs reference in the District Court (PJ [127]–[135]). The tension which the applicants claimed they faced was summarised by the primary judge at PJ [199] in the following way:

6. [21]

   Several months passed after service of the original statement of claim during which the applicants did not amend their pleadings.

7. [22]

   In April 2021, the applicants served a notice of motion below seeking a temporary stay of the proceeding or, alternatively, leave to amend their statement of claim. This notice of motion did not propound any form of amended pleading; nor was any draft amended pleading put forward in the supporting affidavit (PJ [146]).

8. [23]

   Having failed to comply with orders on several occasions (PJ [149]–[151]), and in light of the fact that the applicants continued to insist that they did not wish to rely on their initial pleading (PJ [152]), the primary judge struck out the applicants’ original statement of claim on 18 November 2021. A costs order was made against them but the primary judge also made clear that the applicants could apply to vary those costs orders when the matter came before her Honour again in December 2021 (PJ [152]).

9. [24]

   Four days later, on 22 November 2021, the applicants served the first version of a proposed amended statement of claim (PJ [154]). On 3 December 2021, the proposed amended statement of claim was replaced by another version (PJ [154]).

10. [25]

    The nature of the conspiracy as alleged in the proposed amended statement of claim is summarised by the primary judge at PJ [160]–[193]. A further summary of the claims made against the respective sets of respondents is found at PJ [246]–[328].

11. [26]

    The matter came before the primary judge for an interlocutory hearing on 7­–9 December 2021. The respondents complained that the proposed amended statement of claim contained multiple deficient pleadings (see, eg, PJ [194]–[196]). At that hearing the parties effectively sought the following relief (PJ [1]):

12. [27]

    The Suncorp respondents also submitted that it would be open to the Court to declare the applicants to be vexatious litigants, contending that the applicants had been bringing claims of conspiracy since 2007 with complete disregard for the necessary legal and factual basis for any such claim, and the proceeding before the primary judge was one further iteration of that same pattern of conduct (see PJ [460]–[472]).

13. [28]

    The primary judge noted at PJ [473] that the issues which remained for determination following the earlier striking out of the original statement of claim were:

    1. (1)

       whether, on the applicants’ application, (a) the proceeding should be stayed pending the outcome of the costs reference in, or the conclusion of, the De Costi proceedings; or (b) alternatively, whether leave should be granted to the applicants to file an amended statement of claim (although her Honour subsequently found that this claim for alternative relief was not ultimately pressed); or

    2. (2)

       whether, on the respondents’ applications, the proceeding ought to be permanently stayed or summarily dismissed; and

    3. (3)

       the issue, raised in the Suncorp respondents’ submissions, as to whether, on her Honour’s own motion, the applicants should be declared vexatious litigants (other than in relation to the finalisation of the District Court proceedings relating to the costs applications in the De Costi proceedings).

14. [29]

    The determination of issues 1 and 2 was closely linked. The primary judge found that there were numerous pleading deficiencies in the latest version of the proposed amended statement of claim. Those deficiencies are identified and discussed at considerable length in various parts of the primary judge’s reasons.

15. [30]

    Her Honour concluded at PJ [476]:

16. [31]

    At PJ [482], her Honour stated:

17. [32]

    After noting at PJ [486] that the applicants did not press for leave to file the proposed amended statement of claim, her Honour added that she would have refused leave in any event. Her Honour added that she accepted that the proposed amended statement of claim as then drafted did not disclose a reasonable cause of action in conspiracy.

18. [33]

    The primary judge rejected the principal premise on which the applicants put their temporary stay application, namely that they were not in a position to plead their claims until the outcome of the costs reference was known (PJ [488]). Her Honour said that the applicants were in no different a position from other litigants who file pleadings based on a contingency that certain outcomes will follow from impugned conduct.

19. [34]

    The primary judge noted that, while she ordinarily would have been inclined to allow the applicants to replead, they had effectively already had that opportunity (having served two versions of a proposed amended statement of claim). Moreover, as the applicants continued to maintain that they were not in a position to replead, the consequence was that any such order would be futile (PJ [489]).

20. [35]

    The primary judge made an explicit finding at PJ [499] that it was an abuse of process for the applicants to make such serious allegations without a proper pleading and then to seek to have that proceeding remain in abeyance indefinitely. Her Honour stated that to leave on foot the very serious and deficiently pleaded allegations against the respondents would have been unjustifiably oppressive to those respondents and would have brought the administration of justice into disrepute (PJ [500]). The proceeding was summarily dismissed.

21. [36]

    The primary judge declined to declare the applicants to be vexatious litigants (PJ [508]). Instead her Honour considered it appropriate to refer the matter to the Attorney-General for his consideration (PJ [520]).

Nature of the present proceeding

1. [37]

   The applicants sought leave to appeal from the whole of the decision below.

2. [38]

   The original draft notice of appeal listed the following appeal grounds:

3. [39]

   The applicants filed a notice of motion on 24 June 2022 seeking leave to amend and substitute their proposed draft notice of appeal and summary of argument.

4. [40]

   In their supporting affidavit to the motion, the applicants provided a proposed amended draft notice of appeal. One further proposed appeal ground was added (as tracked):

5. [41]

   The proposed amended draft notice of appeal also altered the orders sought. Former order 3 was changed and a new order 7 was sought (as tracked):

Applicants’ submissions summarised

1. [42]

   In their original summary of argument, the applicants contended that the following questions arise in their leave to appeal application:

2. [43]

   At [12]–[20] the applicants set out ‘relevant principles’, covering issues such as the test for dismissal on the ground that no reasonable cause of action is disclosed in a pleading, what is needed to make out a claim in conspiracy and the manner in which cases involving circumstantial evidence should be dealt with.

3. [44]

   At [21]–[31] the applicants set out the factual matters and circumstances which they allege support an inference of agreement informing the conspiracy between the respondents, indicate the knowledge of particular alleged conspirators to the alleged conspiracy and set out the basis for the assertion that the conspiracy was intended to injure the applicants.

4. [45]

   There is little structure to the applicants’ written arguments at [32]–[45]. They move between alleging further factual matters which allegedly support the applicants’ case on conspiracy and noting the alleged errors of the primary judge:

5. [46]

   In oral address, Mr Newell (who appeared for himself and Mr Muriniti) again contended that the primary judge’s summary dismissal decision was based on the proposed amended statement of claim not disclosing a reasonable cause of action and not on the basis of abuse of process. Relatedly, he contended that, in circumstances where the primary judge found that the still undetermined costs reference was not a bar to a proper pleading, the primary judge should have granted leave to amend as sought by the applicants in prayer 5 of their notice of motion filed on 1 April 2021 in the proceeding below.

6. [47]

   In the supporting affidavit to their notice of motion filed on 24 June 2022 in this proceeding, the applicants provided a proposed amended draft summary of argument.

7. [48]

   To the end of paragraph 3 of the original summary of argument (extracted above at [42]), the applicants added (proposed changes underlined):

8. [49]

   The only other tracked change made was to insert a new [46] into the summary of argument, which makes a complaint that the primary judge made the costs order in November 2021:

9. [50]

   In oral address, Mr Newell submitted that the applicants should have leave to appeal against the primary judge’s costs order arising out of the decision to strike out the original statement of claim, not least because the financial burden posed by those costs would severely undermine their ability to prosecute the proposed appeal.

Respondents’ submissions summarised

1. [51]

   There are 23 respondents. Some of the respondents adopted the submissions of other respondents. To avoid repetition, we propose to summarise the respondents’ submissions collectively by reference to the relevant topic.

2. [52]

   The Lawcover/YPOL respondents; Suncorp respondents; 8th, 11th, 13th, 19th, and 20th respondents; 10th respondent; 14th respondent; 18th respondent; and 22nd respondent all opposed a grant of leave.

3. [53]

   Broadly, each of these respondents submitted that the applicants’ summary of argument and draft notice of appeal disclosed no House v The King (1936) 55 CLR 499; [1936] HCA 40 error. They submitted that the primary judge correctly decided the matter before her and exercised her discretion appropriately.

4. [54]

   The Lawcover/YPOL respondents submitted that the primary judge correctly held that the proposed amended statement of claim did not disclose a reasonable cause of action in conspiracy.

5. [55]

   The Suncorp respondents submitted that the primary judge did not make a dispositive finding as to whether the proposed amended statement of claim failed to disclose a reasonable cause of action in conspiracy. Rather, the primary judge found that it suffered from serious pleading deficiencies. The Suncorp respondents also contended that the applicants failed to identify any House v The King error in respect of this ground.

6. [56]

   To similar effect, the 22nd respondent submitted that while the primary judge accepted that the proposed amended statement of claim did not disclose a reasonable cause of action in conspiracy, her Honour did not summarily dismiss the proceeding on this basis. Instead, her Honour dismissed the proceeding because they constituted an abuse of process, a conclusion in respect of which the applicants failed to show arguable error.

7. [57]

   The Lawcover/YPOL respondents submitted that the primary judge correctly held that to order a temporary stay would bring the administration of justice into disrepute and/or be oppressive to the respondents.

8. [58]

   The Suncorp respondents submitted that this proposed ground made a general assertion of error in the ultimate finding below without identifying any House v The King error. The 22nd respondent made a similar submission.

9. [59]

   The Lawcover/YPOL respondents made no specific submissions on this proposed ground apart from their contention that there was no error in the primary judge’s reasoning and the ultimate orders her Honour made were correctly made for the reasons published in her judgment.

10. [60]

    The Suncorp respondents similarly submitted that this proposed ground made a general assertion of error in the ultimate finding below without identifying any House v The King error.

11. [61]

    The 22nd respondent submitted that this proposed ground was repetitive of the issues covered in proposed grounds 1 and 2.

12. [62]

    The Lawcover/YPOL respondents made no specific submissions on this proposed ground apart from contending that there was no error in the primary judge’s reasoning and the ultimate orders her Honour made were correctly made for the reasons published in her judgment.

13. [63]

    The Suncorp respondents similarly submitted that this proposed ground made a general assertion of error in the ultimate finding below without identifying any House v The King error.

14. [64]

    The 22nd respondent submitted that this proposed ground was repetitive of the issues covered in proposed ground 2.

15. [65]

    The Lawcover/YPOL respondents submitted that, insofar as the applicants allege that the primary judge failed to take account of relevant considerations, the applicants made no specific submissions in their summary of argument and failed to identify any error of fact or law. The 22nd respondent made the same complaint. The Lawcover/YPOL respondents further submitted that the primary judge took into account all relevant considerations in her detailed judgment, and that her Honour’s discretion did not otherwise miscarry.

16. [66]

    The Suncorp respondents similarly contended that this alleged error did not arise. They noted that the applicants now sought to allege that the relevant consideration which her Honour failed to take into account was the “real prejudice” to the applicants from the costs order in the proceeding below, which would prevent the conduct of fresh proceedings by the applicants. The Suncorp respondents noted that the applicants did not raise this issue below and argued that they should not be permitted to raise it now. They further submitted that the “prejudice” was purely speculative.

17. [67]

    The Lawcover/YPOL respondents; Suncorp respondents; 8th, 11th, 13th, 19th, and 20th respondents; 10th respondent; 14th respondent; 18th respondent; and 22nd respondent opposed a grant of leave to amend.

18. [68]

    If leave to amend was granted, the 14th respondent submitted in the alternative that leave to appeal from the costs order made on 18 November 2021 should be refused.

19. [69]

    This proposed ground seeks to impugn the decision of the primary judge on 18 November 2021 to make a costs order against the applicants upon the striking out of the original statement of claim. The Lawcover/YPOL respondents, Suncorp respondents and 14th respondent contended that this decision is separate from the decision from which leave to appeal is sought and is not within the scope of the summons presently before the Court.

20. [70]

    These respondents broadly submitted that any application for leave to appeal from that costs order is hopelessly out of time and there are no grounds for granting an extension of time. In addition:

21. [71]

    The Suncorp respondents, 10th respondent and 14th respondent each opposed proposed order 7 for the following reason. They noted that this proposed order seeks that the respondents pay certain costs associated with notices of motion for lump sum costs orders which were filed only by some of the respondents.

22. [72]

    The Suncorp respondents and the 10th respondent contended that the applicants had failed to identify any basis for the Court making such an order against them.

23. [73]

    The 14th respondent submitted that it would be inappropriate to grant leave to include proposed order 7 because these motions were yet to be determined and the applicants failed to identify the basis upon which the Court should make such an order.

Consideration and determination

1. [74]

   There was no contest that the applicants require leave to appeal in respect of what is properly characterised as an interlocutory judgment (see s 101(2)(e) of the Supreme Court Act 1970 (NSW) and Macatangay v State of New South Wales (No 2) [2009] NSWCA 272 at [10]–[13] per Allsop P, Tobias JA and Handley AJA).

2. [75]

   There was also broad agreement regarding the relevant principles to apply in determining whether or not to grant leave to appeal. As Sheller JA said in Carolan v AMF Bowling Pty Ltd t/as Bennetts Green Bowl [1995] NSWCA 69 at p 2:

3. [76]

   The principles as they apply to leave to appeal from a discretionary decision were elaborated upon by Gleeson JA (with whom Macfarlan and Payne JJA agreed) in Secretary, Department of Family and Community Services v Smith (2017) 95 NSWLR 597; [2017] NSWCA 206 at [28]–[30]:

4. [77]

   We did not understand the applicants to contest the respondents’ submissions that the primary judge’s decision summarily to dismiss the proceeding involved the exercise of a discretionary power which thereby attracted the requirements in House v The King.

5. [78]

   In addition, having regard to the proper characterisation of the primary judge’s summary dismissal decision and refusal to grant a temporary stay of the proceeding as relating to matters of practice and procedure, it is also important to note the well-settled reluctance of appellate courts to review such matters. For example, in Adam P Brown Male Fashions Pty Ltd v Phillip Morris Inc (1981) 148 CLR 170 at 177; [1981] HCA 39 per Gibbs CJ, Aickin, Wilson and Brennan JJ:

6. [79]

   These principles were conveniently summarised by Barrett AJA in Treadtel International Pty Ltd v Cocco [2016] NSWCA 360; (2016) 316 FLR 318 at [29]:

7. [80]

   For the following reasons, the applicants have not satisfied us that any of their proposed grounds of appeal raise an arguable error or issue of principle.

8. [81]

   As to proposed ground 1, it is predicated on a claim that the summary dismissal decision was based on a finding by the primary judge that the applicants’ proposed amended statement of claim did not disclose a reasonable cause of action. That claim is not arguable simply because no such finding formed the basis for her Honour’s decision summarily to dismiss the proceeding. That decision was based on what the primary judge described at PJ [490] and [499] as an abuse of process. In particular, her Honour made it abundantly clear at PJ [499] that she considered it to be an abuse of process “to make such serious allegations (of fraudulent and criminal conduct) without a proper pleading and then to seek for that proceeding to remain in abeyance for an indefinite period of time”. The applicants have failed to establish any arguable error in relation to the primary judge’s supporting reasons in arriving at that conclusion.

9. [82]

   As is evident from the above summary of the primary judge’s reasoning, there is no doubt that the primary judge accepted the respondents’ claim that the latest version of the proposed amended statement of claim did not disclose a reasonable cause of action in conspiracy (see at PJ [486]). That then led to the primary judge’s observations at PJ [489]:

10. [83]

    It is evident from the wording of that paragraph that the primary judge was addressing a hypothetical instance where a pleading is struck out for pleading deficiency. On a fair reading her Honour was saying that if the pleading had been struck out for pleading deficiency, she would ordinarily provide an opportunity to replead. She then immediately added that, in the present proceeding, the applicants had already had that opportunity (having provided in fact two versions of a proposed amended statement of claim after the original statement of claim was struck out) and they still maintained they were not in a position to replead. The primary judge then identified the “real issue” at PJ [490] as the issue of abuse of process. That concept provided the foundation for the proceeding being summarily dismissed.

11. [84]

    In oral address, the applicants also contended that the primary judge erred in not granting them leave to replead, as sought by them in prayer 5 of their notice of motion below. Elaborating upon that contention, the applicants claimed that they should have had that opportunity because the primary judge found that, contrary to their asserted position, the unfinalised costs reference in the District Court did not present an insurmountable bar to a proper pleading.

12. [85]

    These contentions do not present any arguable error or issue of principle to warrant a grant of leave to appeal. First, acceptance of the applicants’ argument would effectively entail acceptance of the proposition that the applicants were entitled to the benefit of some form of judicial advice on the adequacy of their proposed pleading before being given an opportunity to act upon that advice by having leave to replead. The detailed written submissions of the respondents, filed in advance of the hearing below, put the applicants on clear notice that there were numerous pleading deficiencies in both their proposed amended statements of claim. The primary judge found that virtually all of those pleading deficiencies existed. The applicants took no steps to remedy those deficiencies prior to the hearing. No arguable error is shown because the primary judge did not grant the applicants yet another opportunity to replead.

13. [86]

    Secondly, it was also well open to the primary judge to proceed on the basis that the applicants did not press prayer 5 of their notice of motion in the proceeding below. On no less than three occasions in his oral address below, Mr Newell told the primary judge that:

    1. (1)

       “… it doesn’t seem to make any sense to talk about … an amendment if we can’t put to the Court that this is the claim to be taken to trial; it is not the claim to be taken to trial”;

    2. (2)

       he accepted as correct the primary judge’s understanding that the applicants’ position “is you don’t want to proceed with the proposed amended statement of claim that is the subject of your alternative relief” because “… it makes no sense to do it and would lead to an incoherent position because you’d only be seeking to amend later at great cost …”; and

    3. (3)

       he explained that the applicants “… don’t even envisage that the Court would contemplate an amendment where it’s not the matter that can be taken to trial”.

14. [87]

    Nor is there any arguable substance in the applicants’ argument (raised for the first time in their summary of argument) that they were denied natural justice because abuse of process was not argued below. This claim is untenable. The possibility of the proceeding constituting an abuse of process was raised several times during the course of the hearing below (for example, see T 58.16–44, T 94.4–17 and T 103.46–104.1 and see also [106]–[109] of the amended written submissions below filed on behalf of the Suncorp respondents on 5 December 2021). Moreover, the issue of abuse of process was directly raised with Mr Newell several times by the primary judge during the course of oral address below (see T 140.46­–141.30 and T 142.46–143.17).

15. [88]

    Proposed appeal grounds 2, 3 and 4 may be dealt with together. None of them involves an arguable error by the primary judge or raises an issue of principle. Moreover, the applicants have failed to identify any House v The King error in respect of any of these matters. As to proposed ground 2, no arguable error has been established in relation to the primary judge’s finding that she would not grant the applicants a temporary stay of the proceeding because that would bring the administration of justice into disrepute and be unduly oppressive to the respondents. Her Honour was plainly correct to give great weight to the seriousness of the allegations against the respondents, namely fraud and criminal conduct, without an adequate pleading.

16. [89]

    Proposed ground 3 involves a bald assertion that the primary judge erred in dismissing the proceeding. The applicants contended that a proceeding should only be summarily dismissed in “wholly exceptional circumstances”. This contention was linked to the applicants’ claim that the primary judge dismissed the proceeding on the basis of deficient pleadings. That contention is wrong, as explained above. No arguable error is demonstrated in respect of the primary judge’s analysis and application of the principles concerning abuse of process.

17. [90]

    As to the applicants’ contention that the primary judge erred in concluding that summary dismissal would not on balance be unduly prejudicial to the applicants because it was open to them to file fresh proceedings without having to confront a limitation problem, the applicants have failed to establish any arguable House v The King error.

18. [91]

    No arguable error has been shown in respect of proposed ground 4. Her Honour’s refusal to grant the applicants a temporary stay flowed inexorably from her conclusion that the proceeding was an abuse of process (see [36] above).

19. [92]

    Proposed ground 5 asserts that the primary judge’s discretion miscarried in dismissing the proceeding and refusing a temporary stay because she failed to take into account relevant considerations and misapprehended the applicants’ case in support of a temporary stay. The proposed amended notice of appeal does not particularise these claims. Nor is it easy to divine any particulars from the applicants’ written and oral submissions. It may be that one alleged “relevant consideration” is what the applicants described in their summary of argument (at [43]) that they would suffer “real prejudice” because their obligation to meet the costs orders flowing from the summary dismissal decision would present “serious barriers to advancing the proceedings …”. The argument is untenable. It was not raised below and, in any event, the fact that the applicants bear a costs liability is the ordinary consequence of their unsuccessful motion and the successful motions of the respondents below. It might also be noted that the applicants adduced no evidence in support of their claim that they were unable to meet the costs orders.

20. [93]

    As to the claim that the primary judge misapprehended the applicants’ case, presumably this is a reference to the significance which the applicants attach to the outstanding costs reference. As is evident from the extracts from her Honour’s reasons for judgment as set out above (see, in particular, PJ [199] which is set out at [20] above), there was no such misapprehension. Rather, the primary judge did not accept the core logic of the applicants’ argument.

21. [94]

    As noted above, by their notice of motion filed 24 June 2022, the applicants also sought leave to amend their notice of appeal so as to add a further proposed ground of appeal which claimed that the primary judge erred in ordering them to pay the costs of the proceeding which resulted in the original statement of claim being struck out on 18 November 2021. The applicants contend that no such order had been foreshadowed by the respondents, the applicants were not heard on the matter before the order was made and the order should not have been made in circumstances where an amended statement of claim was anticipated.

22. [95]

    None of these claims has arguable substance. As to the first claim, at the hearing on 18 November 2021, Mr Newell sought an order that the costs of the strike out motions be reserved but this was rejected for reasons set out at PJ [152]. Her Honour confirmed there that the order for costs made on 18 November 2021 was an order made which followed the event, namely the striking out of the statement of claim.

23. [96]

    Secondly, and importantly, as is made clear at PJ [152], the applicants were told that they could apply to have the costs order varied when the matter came before the primary judge for hearing in December 2021. No such application was ever made.

24. [97]

    Thirdly, as several respondents pointed out, the 18 November 2021 costs order falls outside the summons seeking leave to appeal and an extension of time needs to be sought and granted. That is because the costs order was made in a separate and earlier interlocutory decision.

25. [98]

    Finally, it is necessary to address new order 7 in the amended draft notice of appeal, which is as follows:

26. [99]

    This new order evidently seeks an order (for the first time) that the respondents pay the applicants’ costs in relation to the respondents’ motions for lump sum costs below. A central difficulty with this matter is that the motions for lump sum costs are yet to be determined. Moreover, not all respondents have filed motions for lump sum costs in the proceeding below.

27. [100]

    We would not grant leave to amend so as to add proposed new order 7.

Conclusion

1. [101]

   For these reasons, the applicants’ summons should be dismissed, with costs following the event (subject to what is said immediately below). The applicants’ motion filed on 24 June 2022 should also be dismissed, with costs following the event (subject to what is said immediately below).

2. [102]

   It would appear that the De Costi respondents and the 15th respondent are not entitled to costs because they either made no submissions and/or filed no appearance. Any party who opposes the proposed costs orders should file and serve a brief submission not exceeding 2 pages in length within seven (7) days hereof. If any submission is filed within that period, the other parties have liberty to file and serve a brief submission in response not exceeding 2 pages in length within a further seven (7) days thereof. Final orders as to costs will be determined on the papers and without a further oral hearing.