Plaintiff Seeks Damages for Breach of Naval Training Contract

Searle v Commonwealth of Australia [2022] NSWSC 119 (16 February 2022)

The plaintiff claims damages from the defendant for breach of contract with respect to the provision of training as a part of their enlistment with the Royal Australian Navy.  In dispute is whether or not the disputed evidence should be the subject of an advance ruling. The Commonwealth argued that it is not appropriate for the Court to give such an advance ruling because the particular circumstances are not such as to enable any good reason to be identified to justify such a ruling.  

Facts:

In 2016, the plaintiff, Clayton Searle, commenced proceedings against the defendant, the Commonwealth of Australia, claiming damages for himself and on behalf of the members of an identified group (“the Group Members”) for breach of contract with respect to the provision of training as a part of their enlistment with the Royal Australian Navy.  On 3 July 2018, for the reasons which he then delivered, Fagan J dismissed the plaintiff’s claim.  The plaintiff appealed to the Court of Appeal.  On 31 May 2019, the Court of Appeal (Bathurst CJ, Bell P and Basten JA) upheld the plaintiff’s appeal and set aside the orders of Fagan J dismissing the plaintiff’s claim.  

The Court of Appeal ordered that judgment for the plaintiff be entered in the sum of $60,000 together with interest and costs.  The Court of Appeal remitted the matter to the Common Law Division for the determination of the claims of other Group Members and the resolution of common questions between claims of all Group Members.  Bell P, in his judgment, said that on 17 January 2011, the applicant, Mr Clayton William Searle (“Mr Searle”) was enlisted in the Royal Australian Navy (“the Navy”) as a Marine Technician.   On 20 June 2011, he entered into a contract with the Commonwealth for the purpose of undertaking training which would lead to a Certificate IV qualification in Engineering (“the Training Contract”).

The “nominal term” of the Training Contract was stated to be 48 months.  A number of other enlisted servicemen and women executed similar contracts with the Commonwealth.  The training contemplated by the Training Contract was not provided.  The primary judge held that the Commonwealth evinced an intention in June 2014 not to be bound by the Training Contract by announcing that Mr Searle and other servicemen and women who had signed such contracts ‘would not be obtaining the Certificate IV in Engineering ... at the end of the contract’.”  The Commonwealth did not seek to argue that the Training Contract was subject to an implied term that left it free to redirect Mr Searle’s course of training or to suspend it for operational reasons, and this was not considered by the primary judge.

Naval Command required Mr Searle to undertake a different training course or be deployed abroad in a manner that made it impossible for the Training Contract to be performed, either at all or as contemplated by its terms, it would have been open to and appropriate for a court asked for a decree of specific performance to decline to enforce the Training Contract.  The Court held that the Training Contract was not ultra vires or void, nor was it satisfied that an award of damages would have fettered or would fetter the future exercise of the discretion reposed in Naval Command.  His Honour, the trial Judge, was not satisfied that Mr Searle had identified any specific available job in the region where he proposed to live for which a Certificate IV was a qualification and for which he would likely have successfully applied if he had held the Certificate. 

The plaintiff submits that disputed evidence would be in dispute if it were admissible and would necessitate the calling of a significant number of witnesses to refute it.  The plaintiff submits that the disputed evidence ought be the subject of an advance ruling pursuant to s 192A of the Evidence Act 1995 (NSW) because, first, the evidence is clearly inadmissible and, secondly, the ruling sought would, if made, result in substantial time and cost savings for the parties and the Court.  The Commonwealth submits that it is not appropriate for the Court to give such an advance ruling because the particular circumstances are not such as to enable any good reason to be identified to justify such a ruling.  The Commonwealth submits that the evidence is relevant or, at least arguably so, sufficient to defer to the final hearing of the matter any final ruling on its admissibility.

Issue:

Whether or not the disputed evidence should be the subject of an advance ruling.

Applicable law:

Civil Procedure Act 2005 (NSW), Pt 10, s 56 - provides that the overriding purpose of the Act and the rules of Court in civil proceedings is “to facilitate the just, quick and cheap resolution of the real issues in the proceedings”.

Evidence Act 1995 (NSW) s 55 - provides that evidence that is relevant in a proceeding is evidence that, if it were accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue in the proceedings. 

Evidence Act 1995 (NSW) s 56 - provides that evidence that is relevant in a proceeding is admissible. 

Evidence Act 1995 (NSW) s 192A - pursuant to which the Court ruled that the following evidence proposed to be adduced by the Defendant in the hearing of the claims of the Sample Group Members is not admissible

Australian Securities and Investments Commission, in the matter of Whitebox Trading Pty Ltd v Whitebox Trading Pty Ltd [2017] FCA 324 - where it was held that section 192A permits but, does not compel, advance rulings to be given on the admissibility of evidence.

Davaria Pty Limited v 7-Eleven Stores Pty Ltd (No 9) [2021] FCA 473 - provides that there is no specific test to apply in order for the Court to make an advance ruling under s 192A of the Act.  It will be a matter of discretion, having regard to the circumstances before the Court and implementing the purpose of s 192A, having regard to good case management principles.

Analysis:

A sound reason to refuse to give a ruling under s 192A may exist where the proceeding is in its infancy, the issues have not yet been joined because the pleadings have not closed and it is uncertain whether the evidence sought to be the subject of the advance ruling will be relied upon at final hearing.  The evidence which the Commonwealth proposes to adduce would be given by two witnesses on behalf of the Commonwealth and would be contested by evidence to be called by the plaintiff from an additional 12 witnesses, six of whom reside in States other than NSW, and three of whom reside in NSW but outside the Greater Sydney area.  The solicitor for the plaintiff, Mr Imlay, gave evidence, which was not subject to cross-examination or dispute, that his calculation was that if the evidence is admitted, the hearing would be extended by between three and four days having regard to the number of witnesses to be called, the extent of cross-examination and the extent of admissions to be made.  The existence and extent of the dispute over this evidence would lead to considerable additional legal expense by way of preparation of the witnesses for the hearing and the preparation of cross‑examination by both sides to deal with this issue.  

The course proposed by the plaintiff of an advance ruling has significant cost and efficiency benefits.  It will be cheaper, it will save a significant number of witnesses from having to give evidence and, importantly, it will save a considerable number of days of hearing.

Conclusion:

Advance ruling pursuant to s 192A of the Evidence Act 1995 (NSW) that the evidence contained in:

(1) paragraphs 11-27 and 33-34 of the affidavit of Ms Justine Lee Windsor sworn 25 September 2017; and

(2) paragraphs 30-31, 36-41 and 45-46 of the affidavit of Mr Tyrone Edward Palmer dated February 2018,

is inadmissible.

2 Order that the Commonwealth pay the plaintiff’s and sample Group Members’ costs of and incidental to this Motion.