THRIFTY RENT-A-CAR PTY LTD v. DARWIN MARKETING SERVICES PTY LTD & ORS

Supreme Court of the Northern Territory of Australia Martin J. in Chambers
22 and 29 October 1987 at Darwin

Practice and Procedure - Application by plaintiff for summary judgment - Principles to be applied
Cases considered:
Clarke v. Union Bank of Australia Ltd 23 C.L.R. 5
Theseus Exploration N.L. v. Foyster (1972) 126 C.L.R. 507
Fancourt v. Mercantile Credits Limited (1983) 154 C.L.R. 87 Australian Can Co. Pty Ltd v. Levin & Co. Pty Ltd 1947
V.L.R. 332
Inglis v.	Commonwealth Trading Bank of Australia (1972) 20 F.L.R. 30

Cases referred to:
John Holland Constructions Pty Ltd v. Jordin 32 N.T.R. 52

Counsel for Plaintiff Solicitor for Plaintiff

Counsel for Second and Third Defendants
Solicitor for Second Defendant
Solicitor for Third Defendant

Mr. Beaumont Q.C.
Mildren, Silvester
& Partners

Mr. Pauling Q.C.
Morris, Fletcher
& Cross David Winter

mar870004

IN THE SUPREME COURT
OF THE NORTHERN TERRITORY OF AUSTRALIA
No. 106 of 1987

BETWEEN:

THRIFTY RENT-A-CAR PTY LTD
Plaintiff

AND:
DARWIN MARKETING SERVICES PTY LTD
First Defendant

AND:

COLIN JOHN FITZGERALD
Second Defendant

AND:
DEBORAH ELLEN FITZGERALD
Third Defendant

CORAM:	MARTIN J.

REASONS FOR JUDGMENT
(delivered 29 October 1987)

These proceedings were commenced by writ of summons specially indorsed with a statement of claim on 3 March 1987.	In them the plaintiff originally sought against the second and third defendants $143,395.20 but with an amendment by consent sought before me that sum is now
$203,827.03.

The plaintiff's claims against the second and third defendants are for monies alleged to be due to it pursuant to a number of agreements.	They are not informal but take the form of documents carefully prepared with legal consequences in mind to govern the somewhat complex commercial relationship between the plaintiff and the defendants.

The first documents comprise two identical agreements called "Licence Agreements" each relating to different parts of the Northern Territory and entered into between the plaintiff and the first defendant.	The next is what is called "the Car Leasing Agreement" between the plaintiff and the first defendant.	The third comprise two guarantees given by the second and third defendants to the plaintiff which, in general terms, the plaintiff says oblige the second and third defendants to guarantee to the plaintiff the payment of money and performance of covenants by the first defendant under all the agreements with it.

The plaintiff has sought summary judgment against the second and third defendants and the second defendant has sought to have judgment summarily entered in his favour against the plaintiff.	The summons came on for consideration before me in Chambers on 22 October 1987.	I was directed to the provisions of the various agreements and guarantees and referred to the pleadings and some facts

which appear from affidavits sworn in relation to sundry interlocutory steps.

I was invited by the plaintiff to consider the documents and facts referred to, to determine to deal with each application summarily and enter judgment.	The second and third defendants resisted that course and the second defendant did not really press the application against the plaintiff unless I should find that this was a proper case in which to deal with the issues summarily.	I was directed to some provisions in the documents which counsel for the second and third defendants argues cast doubt upon the interpretation contended for by counsel for the plaintiff and which, if resolved in his clients' favour, would relieve them from the whole or a substantial part of the plaintiff's claim.

Order 15 rule 1 of the Rules of Court provides -

"(1)	Where a defendant appears to a writ of summons specially indorsed with or accompanied by a statement of claim under Order 4, rule 5, the plaintiff may, on affidavit made by himself or by any other person who can swear positively to the facts, verifying the cause of action and the amount claimed (if any liquidated sum is claimed), and stating that in his belief there is no defence to the action except as to the amount of damages claimed (if any), apply to a Judge for liberty to enter judgment for such remedy or relief as upon the statement of claim the plaintiff is entitled.
to.
(2)	A Judge may thereupon, unless the defendant satisfies him that he has a good defence to the action on the merits, or discloses such facts as

are deemed sufficient to entitle him to defend the action generally, make an order empowering the plaintiff to enter such judgrnent as is just, having regard to the nature of the remedy or relief claimed."

As to the defendants' application, Order 17 rule 1 provides -

"Any defendant to an action may, within ten days after appearance, or at any later time by leave of the Court or a Judge, apply to a Judge for summary judgment and if the Judge is satisfied that the action is frivolous, or vexatious, that the defendant has a good defence on the merits, or that the action should be disposed of summarily or without pleadings, the Judge -

(al	may order that judgrnent be entered for the defendant with or without costs;

(b)	may order that the plaintiff shall proceed to trial without pleadings; or
(cl		if all parties consent, may dispose of the action finally, and without appeal, in a summary manner."

The parties do not consent to my disposing of the action finally and without appeal and I note that section 53 of the Supreme Court Act provides that a party may not appeal from an interlocutory judgment except by leave of the Court of Appeal constituted by no less than three Judges.

The doc.uments are lengthy commercial documents.
They contain a number of phrases which are open to competing interpretations and having an operation dependent upon the

That case involved an issue of whether or not the legislation afforded a good defence to the action.

In Theseus Exploration N.L. v. Foyster (1972) 126
C.L.R. 507, another case dealing with the effect of legislation on commercial transaction, after reviewing some earlier authorities showing that when there is a serious point of law raised by the defendant or a difficult question, a Judge in Chambers ought not to decide it, Gibbs
J. went on at p.515 to say -

"No doubt the remarks in these cases were not intended to preclude the exercise of some discretion by a judge to whom application for summary judgment is made in deciding whether the question of law raised is so difficult that it ought not to be decided summarily, and no doubt also sometimes some explanation or reference to authorities will be necessary to enable a judge to decide whether a question is really unarguable.
However, in the present case the questions were serious and disputable and, assuming that the learned primary judge had a discretion, it was entirely proper for him to decline to dispose of them in chambers."

In Fancourt v. Mercantile Credits Limited (1983)
154 C.L.R. 87 at p.99 a Full Court of the High Court of Australia said -

"The power to order summary or final judgrnent is one that should be exercised with great care and should never be exercised unless it is clear that there is no real question to be tried."

A dispute as to the interpretation of an agreement between the parties, being the tenancy agreement, was considered in Australian Can Co. Pty. Ltd. v. Levin & Co.
Pty. Ltd. 1947 V.L.R. 332. Herring C.J. and Lowe J. having reviewed various authorities, including Clarke v. Union Bank of Australia Ltd, said at p.334 -

"From all this it appears that where there is a real case to be investigated either in fact or in law, leave to defend should be given.

In the case before the learned Judge it is not disputed that the plaintiff's right to judgrnent and the defendant's right to defend rested on the proper interpretation of a tenancy agreement between the parties which the plaintiff contended gave to it an option to purchase the leased premises, which option it had purported to exercise.	Where the matter in question on an Order
XIV. summons depends on the proper construction of a document the rule to be applied was laid down by the Court of Appeal in 1888 in the case of
Shurrnur v. Young (1888) 5 T.L.R. 155, in which Lord Esher said, 'A judge might probably, if he was clear from the documents under the defendant's own hand that there was no defence, order judgrnent for the plaintiff; and if the documents showed the defence to be not hopeless, but problematical, he might probably give unconditional leave to defend', and in Bowes v. The Caustic Soda Syndicate (1893) 9
T.L.R. 328, it was said that leave to defend should be given where there was 'a fair dispute as to the meaning of the document.'
In the case under appeal Macfarlan J. thought the meaning of the document clear in the sense for which plaintiff contended, and for this appeal to succeed the appellant must establish that His Honour's view of the document was wrong.	The matter has been argued at length and in detail before us.	But in whatever language the discrimen is expressed to determine in what cases liberty to the plaintiff to sign judgrnent or liberty to the defendant to defend should be given, the length at which or the detail in which or the vigour with which counsel has argued the matter cannot be the determining factor.	So to hold would be to allow the pertinacity or ingenuity of counsel or even the

tolerance of the Judge to obscure the real requirement of the rule.	Whatever the language various Courts have used, it seems to us that the substance of the criterion to be applied is that after the matter involved has been explained to the Judge there must be a real uncertainty without full argument or further investigation of the facts as to the plaintiff's right to judgment."

At p.337 the Court said -

"We would point out at once that we are not here dealing with any informal business document but with one that bears on its face evidence of careful preparation by a skilled draughtsman.	We are not therefore concerned with the liberal construction to which Isaacs J. refers in Sinclair, Scott & Co. v. Naughton (1929) 43 C.L.R., at p.320 as applicable to 'informal business instruments'."

Fulla_gar J. agreed.

Counsel for the plaintiff referred me to John Holland Constructions Pty Ltd v. Jordin 32 N.T.R. 52 in which His Honour Mr. Justice Nader upon application to strike out a statement of claim, drew attention to what was said by Woodward J. in Inglis v. Commonwealth Trading Bank of Australia (1972) 20 F.L.R. 30.	In that case His Honour said, inter alia, -

if the question has in fact been fully argued, either because it appeared at first to be more simple than in reality it was, or because the point could only be developed and explained at some length, then the court or judge has a discretion to rule on the matter in the interests of preventing unnecessary costs.	The pressure to follow such a course will be particularly apparent in an appellate court.•.

In this regard reference might also be had to Theseus Exploration v. Foyster.

Bearing in mind that in my view the questions of interpretation have not been fully argued by counsel for the defendants in particular, he having not done much beyond drawing attention to the possible competing interpretations, and that an appeal upon an interlocutory application is not of right, and applying the various tests that have been posed, in the exercise of my discretion I dismiss both the application by the plaintiff and the application by the second defendant.

I order the plaintiff to pay the second and third defendants' costs of the plaintiff's application.	I make no order as to costs on the application by the second defendant.

I certify that this application was fit for senior

counsel.