Limitation Periods and Interim Preservation Orders

From Uni Study Guides
Jump to: navigation, search

Limitation periods are time during which a plaintiff is allowed to bring a claim - when they expire, they are barred from bringing a claim. Limitation periods are substantive law and not merely procedural: John Pfeiffer v Rogerson.

Interim preservation orders are interlocutory orders which restrict one's dealings with its property. The main ones dealt with here are:

  • Interim injunction
    • Supreme Court can issue whenever just or convenient by virtue of its inherent jurisdiction and s 66 (4) of the Supreme Court Act 1970.
    • Federal Court has power under: Federal Court of Australia 1976 (Cth) s 23.
    • District Court has limited power to grant temporary injunctions for a period not exceeding 14 days or exceeding that period if necessary to enable Supreme Court proceedings to be commenced or heard: District Court Act 1973, (NSW) s 141.
      • Applicant must show that there is a “prima facie” case and that the “balance of convenience” favours the order being made. Usually continue for a short period of time (measured in days).
  • Freezing orders (Mareva injunction) - restricts disposal of assets when there is a danger that the party will abscond/not be able to pay: r 25.11, r 25.14 UCPR.
    • Delivery of assets as security goes well beyond a freezing order: Jackson v Sterling Industries
    • Can be ordered against third parties if (:Cardile v LED Builders):
      1. That party holds power of disposition over assets of potential judgment debtor, or
      2. When some process enforceable by courts may be available to judgment creditor pursuant to which third party may be obliged to contribute funds to help satisfy judgment debt (for example, a guarantor).
  • Search orders (Anton Piller Orders) - seizure of documents and other evidence obtained on an ex parte basis: r 25.19 UCPR. Test for search orders is (:r 25.20 UCPR):
    1. That an applicant seeking the order has a strong prima facie case on an accrued cause of action; and
    2. The potential or actual loss or damage to the applicant will be serious if the search order is not made; and
    3. There is sufficient evidence in relation to the respondent that:
      1. The respondent possesses important evidentiary material, and
      2. There is a real possibility that the respondent might destroy such material or cause it to be unavailable for use in evidence in a proceeding or anticipated proceeding before the court.

This topic is within Resolving Civil Disputes.

Contents

Required Reading

Dorne Boniface, Miiko Kumar and Michael Legg, Principles of Civil Procedure in NSW (2d ed 2012) Thomson Reuters, [5.60]-[5.110]; [5.150]-[5.250].

Limitation Periods

After a certain time has elapsed, a plaintiff will be barred from bringing a claim. This time period is referred to as the limitation period. Sometimes, different limitation periods will apply to the plaintiff's individual causes of action in the statement of claim. The rationale underlying limitation periods is that delay undermines the course of justice.

This was discussed in Brisbane South Regional Health Authority v Taylor:[1]

  • Time will diminish the significance of a known fact or circumstance because its relationship to the cause of action is no longer as apparent as it was when the cause of action arose. Facts and evidence might be forgotten or lost.
  • People have a right to a speedy hearing of an action that had been commenced.
  • It is unfair to a defendant to allow an action to be brought long after the circumstances which gave rise to it have passed.
  • People should be able to arrange their affairs and utilise their resources on the basis that claims can no longer be made against them. Insurers, public institutions and businesses, particularly limited liability companies, have a significant interest in knowing that they have no liability beyond a definite period.

Generally the limitation period begins to run upon accrual of a cause of action and is stopped by the commencement of proceedings. The following table shoes the different limitation periods which apply to different causes of action:

Cause of Action Period
Contract 6 years from the date of the breach.[2]
Tort (general) 6 years from the date of the damage (or in cases of torts that are actionable without proof of damage, from the date the wrongful act was committed).[3]
Breach of trust or recovery of trust properties 6 years from the date on which the cause of action accrues to the plaintiff.[4]
Cause of action founded on a deed or a contract under seal 12 years from the date on which the cause of action accrues to the plaintiff.[5]
Recovery of land 12 years from the date on which the cause of action accrues to the plaintiff.[6]
Defamation 1 year from the date of publication.[7]
Personal injury (before December 2002) 3 years from the date on which the cause of action accrues to the plaintiff.[8]
Personal injury (after December 2002) 3 years from the date on which the cause of action is discoverable by the plaintiff or 12 years running from the time of the act or omission alleged to have resulted in the injury or death, whichever period is the first to expire.[9]
Work injury 3 years after the date on which the injury was received.[10]
Motor accident 3 years after the date of the motor accident.[11]

Limitation Periods are Substantive Law

Limitation periods are actual substantive law, and not just procedural law. They are governed by the law that governs the cause of action.

This was discussed in John Pfeiffer v Rogerson:[12]

  • Matters that affect the existence, extent or enforceability of the rights or duties of the parties to an action are matters that, on their face appear to be concerned with issues of substance, not with issues of procedure.
  • Mason CJ in McKain[13] formulated that “rules which are directed to governing or regulating the mode or conduct of court proceedings” are procedural and all other provisions or rules are to be classified as substantiative.
  • The application of any limitation period, whether barring the remedy or extinguishing the right, would be taken to be a question of substance not procedure.

Interim Preservation Orders

[14] There are a number of procedures in the UCPR which preserves the rights and property which may be utilised before or after an action is commenced:

  • Injunctive relief: UCPR r 25.2 (1)(c)
  • Orders for disposal of perishable or similar property: UCPR r 25.4
  • Orders for interim distribution of property or income surplus to the subject matter of the proceedings: UCPR rr 25.5-25.6
  • Orders for payment of shares in a fund before the ascertainment of all persons interested: UCPR r 25.7
  • Freezing orders: UCPR r 25.11, r 25.14
  • Search orders: UCPR r 25.19

Interim Injunctions

[15] The Supreme Court has power to grant an interim or interlocutory injunction at any stage of the proceedings in any case in which it appears to the Court to be just or convenient to do so by virtue of its inherent jurisdiction and s 66 (4) of the Supreme Court Act 1970 (NSW).

  • The Federal Court has power to make interlocutory injunctions: Federal Court of Australia 1976 (Cth) s 23.
  • The District Court has a limited power to grant temporary injunctions for a period not exceeding 14 days or exceeding that period if necessary to enable Supreme Court proceedings to be commenced or heard: District Court Act 1973, (NSW) 141.
    • To obtain an interlocutory injunction an applicant must show that there is a “prima facie” case and that the “balance of convenience” favours the order being made. An interim injunction will usually continue for a short period of time (measured in days).

An example of an interim injunction is the injunction obtained by Apple against Samsung to restrain Samsung from launching in Australia its tablet device: Apple Inc v Samsung Electronics Co Ltd.[16]

Interim injunctions were discussed in Australian Broadcasting Corporation v O’Neill:

  • In considering whether to order an interlocutory injunction, the court should ask itself the following:
    1. Whether it looks like the plaintiff actually have a case which might succeed at trial (ie, not frivolous)?
    2. Whether the inconvenience or injury which the plaintiff would be likely to suffer if an injunction were refused outweighs or is outweighed by the injury which the defendant would suffer is an injunction were granted

Freezing Orders

[17] A freezing order (also called a Mareva injunction) prevents a party from disposing of assets to frustrate the enforcement of a judgement. The power to make such an order derives from the court’s inherent equitable jurisdiction, and there is also a statutory basis in the UCPR.

  • Freezing orders are provided for in Division 2 of Part 25 of the UCPR (rules 25.10 to 25.17).
  • An application for a freezing order should comply with the substance of the requirements contained in Practice Note SC Gen 14.

The power to grant freezing orders was first discussed in Jackson v Sterling Industries:

  • Freezing orders are within the powers of the superior courts.
  • They are to be ordered when there is a danger of a defendant absconding or dealing with its assets in such a way that there is a danger that the plaintiff, if he gets judgement, will not be able to get it satisfied.
  • An order to require a party to deliver assets to the court as security goes well beyond a mere freezing order, and is not really within the power of the courts. It can only be issued in exceptional cases.

The power to grant a freezing order against a third party was discussed in Cardile v LED Builders:

  • A court may only grant a freezing order against third parties in circumstances in which:
    1. That party holds power of disposition over assets of potential judgment debtor, or
    2. When some process enforceable by courts may be available to judgment creditor pursuant to which third party may be obliged to contribute funds to help satisfy judgment debt (for example, a guarantor).

Another case which considers freezing orders is Pure Logistics v Scott:[18]

  • Facts: the appellant purchased companies from the respondent, but then found them to be in a worse financial position than the one promised. He commenced action against the respondent, and also sought a freezing order, fearing the respondent would dispose of its assets.
  • Held: the evidence established that the appellant had a good arguable case for the full amount of damages it sought for protection, and also that there was a danger that the respondent would dispose of its assets. Therefore, the freezing orders are granted.

Freezing orders can be made in the absence of a party,[19] and can be served on a person outside of Australia.[20]

Search Orders

[21] Search orders (also known as Anton Piller Orders) involve the seizure of documents and other evidence obtained on an ex parte basis. The respondent does not have notice of the order and it is obtained by the applicant in the respondent’s absence.

  • The purpose of a search order is to preserve evidence which is required to prove that the applicant’s claim and which is in danger of being destroyed.
  • The order permits the applicant’s legal representatives and an independent supervising solicitor to enter the respondent’s premises to search, copy documents and remove property from the respondent’s premises.

The requirements for the granting of a search order are set in r 25.20:

  1. That an applicant seeking the order has a strong prima facie case on an accrued cause of action; and
  2. The potential or actual loss or damage to the applicant will be serious if the search order is not made; and
  3. There is sufficient evidence in relation to the respondent that:
    1. The respondent possesses important evidentiary material, and
    2. There is a real possibility that the respondent might destroy such material or cause it to be unavailable for use in evidence in a proceeding or anticipated proceeding before the court.

Search orders are provided for in Division 3 of Part 25 of the UCPR (rules 25.18 to 25.24). An application for a search order order should comply with the substance of the requirements contained in Practice Note SC Gen 13.

A good illustration of search orders was given in Austress Freyssinet Pty Ltd v Joseph:[22]

  • Facts: The first and second defendants were prior employees of the plaintiff, and the third defendant was a competing business of the plaintiff. The first and second defendants allegedly used confidential information of the plaintiff to establish a competing business etc. The plaintiff obtained search orders against all the defendants, and the first defendant managed to appeal.
  • Held: the conditions necessary for a search order are satisfied: (1) there was sufficient evidence that confidential information of the plaintiff was being misused, (2) that the potential damage to the plaintiff will be serious, (3) that the defendant has evidence which he might destroy. Also, the grant of a search order will not be excessive or out of proportion to the legitimate object of the order.

End

This is the end of this topic. Click here to go back to the main subject page for Resolving Civil Disputes.

References

BKL refers to Dorne Boniface, Miiko Kumar and Michael Legg, Principles of Civil Procedure in NSW (2d ed 2012) Thomson Reuters.

FDR refers to Michael Legg (ed), The Future of Dispute Resolution (2013) LexisNexis.

  1. [1996] HCA 25.
  2. s 14 (1) (a) Limitation Act 1969 (NSW).
  3. s 14 (1) (b) Limitation Act 1969 (NSW).
  4. s 48 Limitation Act 1969 (NSW).
  5. s 16 Limitation Act 1969 (NSW).
  6. s 27 (2) Limitation Act 1969 (NSW).
  7. s 14B Limitation Act 1969 (NSW).
  8. s 18A (2)(a) Limitation Act 1969 (NSW).
  9. s 50C (1) (a) or (1) (b) Limitation Act 1969 (NSW).
  10. s 151D Workers Compensation Act 1987 (NSW).
  11. s 109 Motor Accidents Compensation Act 1999 (NSW).
  12. [2000] HCA 36.
  13. [1991] HCA 56.
  14. BKL, p. 301.
  15. BKL, p. 303-4.
  16. [2011] FCA 1164.
  17. BKL, p. 306.
  18. [2007] NSWSC 595.
  19. UCPR, r 25.13.
  20. UCPR, r 25.16.
  21. BKL, p. 324-5.
  22. [2006] NSWSC 77.
Personal tools
Namespaces

Variants
Actions
Navigation
Toolbox