Construction company Laing O’Rourke Ltd and the Dampier Port Authority hired two of Perth’s top law firms last year when they became enmeshed in a complex dispute over the building of a new jetty; but that hasn’t helped them achieve an effective outcome.
Construction company Laing O’Rourke Ltd and the Dampier Port Authority hired two of Perth’s top law firms last year when they became enmeshed in a complex dispute over the building of a new jetty; but that hasn’t helped them achieve an effective outcome.
The case has attracted scathing criticism from Chief Justice Wayne Martin and become a celebrated example of his campaign to make the court system more efficient.
Mr Martin’s reform plans are widely supported by Perth lawyers, though many are concerned that the judiciary at large does not share the chief justice’s energy or enthusiasm for change.
Mr Martin, who was sworn in as chief justice last May, has wasted little time, introducing the ‘commercial and managed cases list’ in August to speed up the management of civil cases.
“The whole thrust of this reform is to reduce the steps that have to be taken between the start of legal proceedings and their final resolution,” he said at the time.
The Laing O’Rourke case illustrates many of the challenges Mr Martin faces in putting his reforms into practice.
The case stemmed from the construction of a bulk liquids jetty at Dampier, budgeted to cost $44 million.
The costs incurred by Laing O’Rourke (formerly Barclay Mowlem) blew out, so it commenced proceedings last year against the port authority, claiming misleading and deceptive conduct in the amount of $36 million.
It also commenced a claim for $54 million in damages for breaches of contract.
In an interim costs ruling handed down last month, Mr Martin described the “unfortunate history” of the case.
The initial statement of claim, prepared by Mallesons Stephen Jacques, ran to more than 110 pages.
Solicitors for the defendant, Clayton Utz, then submitted objections that ran to 148 pages.
Mr Martin said many of the objections were pedantic and unhelpful and “appear only consistent with an objective of obfuscation and delay”.
“There may well be issues of substance to be found somewhere within the 148 pages of objections; but if they are there, they have been effectively obscured by the sheer volume of the trivial and pedantic objections taken,” Mr Martin said.
Rather than deal with each of the objections, Mallesons lodged a second 56-page statement of claim. Clayton Utz responded with another 40 pages of objections, which Mr Martin once again characterised as pedantic.
Mr Martin intervened in the case at that point, ordering that the parties should confer orally, not through their solicitors but through their counsel, to clarify the key issues.
He said dealing with “a mullock heap of insubstantial and pedantic objections” would consume time and resources entirely disproportionate to the likely benefits.
Following his intervention, a third statement of claim was finally prepared and accepted by the defendants.
The arguments over the statements of claim were followed by arguments over who should bear the costs.
Clayton Utz lodged a claim for costs totaling $116,000, on the basis that it took more than 400 hours – or 10 weeks of full-time work by one person – to prepare the objections.
Mr Martin agreed that costs should be awarded to the defendant, on the basis that “the plaintiff produced a lengthy statement of claim from which it voluntarily resiled in the face of criticism by the defendant”.
However he rejected the $116,000 claim.
Mr Martin decided that a better approach was to calculate the costs that should have been reasonably incurred if the defendant had undertaken a meaningful process of conferral.
He estimated the matter should have been dealt with in 40 hours. At a rate of $350 per hour for a senior practitioner, that came to $14,000.
In his rulings, Mr Martin has emphasised the principle of proportionality – the time and effort put into a case should be proportional to the importance of the issues and the value of the matter involved.
In one case, he said lawyers often preferred the exchange of “furious correspondence” to meaningful conferral to resolve the substantive issues.
Mr Martin has shown little tolerance for lawyers who pursue legal remedies to which they are not entitled.
He found last year that the State Administrative Tribunal had made a number of errors when it reviewed a claim by a group of investors that were adversely affected by the Shire of Busselton’s town planning scheme.
Despite this, he refused to set aside the tribunal’s decision because the applicants sought “prerogative relief” instead of exercising their right of appeal.
“It is the direct consequence of the applicants’ unexplained failure to exercise their right of appeal and instead pursue a complex and technical remedy to which, in my opinion, they are not entitled.”
