Citation: Johnston v ANZ Bank Ltd & 2 Ors [2001] NSWSC 238
Court: Supreme Court of New South Wales, Common Law Division
Date: 6 April 2001
Judge(s): Master Harrison
Background
The plaintiff was a director of a group of companies that farmed property at Corowa, New South Wales. The companies were customers of ANZ Bank, which held a registered mortgage over the farming property. Following a default under a mediated deed of arrangement, the Bank appointed a receiver and manager over the companies in May 1996.
A dispute over possession of the property escalated sharply. Bryson J made orders in August 1996 requiring the plaintiff to vacate the property. After that point, the receiver and one of his employees took steps that led to the plaintiff being prosecuted for two offences under the Inclosed Lands Protection Act 1901 and to apprehended violence orders being obtained against him.
The plaintiff commenced proceedings alleging those steps amounted to the torts of malicious prosecution and abuse of process. The defendants moved to have the proceedings dismissed or struck out.
Legal Issues
- Whether the plaintiff's claims for malicious prosecution and abuse of process could be summarily dismissed under Part 13 of the Supreme Court Rules
- Whether the statement of claim, as pleaded, disclosed sufficient facts to support either cause of action
- Whether the pleadings were deficient and, if so, whether the plaintiff should be permitted to replead
Decision
The defendants' application for summary dismissal under Part 13 failed at the outset. Under section 88 of the Supreme Court Act 1970, claims for malicious prosecution must be tried by jury, and Part 13 summary judgment is not available for proceedings falling within that section. The court followed the reasoning in Associated Securities Finance Ltd v Harrow Properties Pty Limited, holding that this procedural bar applied here.
The court then turned to whether the statement of claim should be struck out under Part 15 r 26 for failing to plead the necessary material facts. For malicious prosecution, the plaintiff must establish that prior proceedings were terminated in his favour, that they were initiated without reasonable and probable cause, and that the defendant acted with malice. The court found the pleadings deficient on several of these elements, particularly the requirement to plead facts establishing lack of reasonable and probable cause and the absence of honest belief in the plaintiff's guilt.
On abuse of process, the court noted this tort does not require the plaintiff to prove termination in his favour or lack of reasonable cause. Instead, the plaintiff must show the defendant initiated legal proceedings predominantly to achieve an end outside the proper purpose of those proceedings. The pleadings were found deficient in this respect also, though the court accepted the claim was not hopeless. The plaintiff's allegation that the proceedings were used to prevent him gaining knowledge about the management of the properties disclosed at least a prima facie basis for an abuse of process claim, warranting determination at trial rather than dismissal.
Because the abuse of process claim retained some viability and the malicious prosecution claim might be properly repleaded, the court declined to dismiss the proceedings entirely. However, the statement of claim was struck out in full for its pleading deficiencies, and the plaintiff was given 28 days to file an amended pleading.
Orders Made
- The statement of claim is struck out.
- The plaintiff is to file and serve an amended statement of claim within 28 days.
- The plaintiff is to pay the defendants' costs.
Key Takeaways
- Summary judgment under Part 13 of the Supreme Court Rules is unavailable in proceedings for malicious prosecution, because section 88 of the Supreme Court Act 1970 reserves such claims for jury trial.
- A pleading for malicious prosecution must set out material facts supporting each element of the tort, including termination of prior proceedings in the plaintiff's favour, absence of reasonable and probable cause, and the defendant's malice. Particulars alone cannot substitute for properly pleaded facts.
- Abuse of process differs from malicious prosecution in that the plaintiff need not prove the prior proceedings were terminated in their favour, that they lacked a reasonable basis, or that damages fall within the traditional heads of reputation, liberty, or property. The plaintiff must, however, plead and prove that the defendant used legal process predominantly to secure an advantage beyond the remedy available in those proceedings.
- A claim that is deficient as pleaded is not necessarily hopeless. The Supreme Court exercised its discretion to permit repleading rather than dismissal where the abuse of process allegations raised a recognisable, if underdeveloped, basis for a cause of action.
- Costs followed the event. The plaintiff bore the defendants' costs despite being granted leave to amend, because the defendants succeeded in having the deficient statement of claim struck out.
Legislation and Cases Referenced
Legislation
- Supreme Court Rules (NSW), Part 13 r 5; Part 15 r 26
- Supreme Court Act 1970 (NSW), s 88
- Inclosed Lands Protection Act 1901 (NSW)
- Real Property Act 1900 (NSW)
- Crimes Act (NSW)
- Farm Debt Mediation Act (NSW)
Cases
- Associated Securities Finance Ltd v Harrow Properties Pty Limited (NSWSC, Lee J, 26 May 1977, unreported)
- H 1976 Nominees Pty Limited v Galli Ltd & Quarries Ltd (1979) 30 ALR 181
- Little v Law Institute of Victoria [1990] VR 257
- Mitchell v John Heine & Son Limited (1938) 38 SR (NSW) 466
- Grimwade v State of Victoria (1997) ATR 81-422
- Saville v Roberts (1868) 1 Ld Raym 374; 91 ER 1147
- Commonwealth Life Assurance Society Limited v Smith (1937-38) 59 CLR 527
- Williams v Spautz (1991-92) 174 CLR 509
- Hanrahan v Ainsworth (1985) 1 NSWLR 370
- Goldsmith v Sperrings Ltd [1977] 2 All ER 566
- Grainger v Hill (1838) 4 Bing NC 212