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Global Claims - Further Support?

Summary

The recent decision of the Supreme Court of New South Wales in John Holland Property Limited v Hunter Valley Earth Moving Co Pty Limited confirms the recent trend in the English courts to allow global claims to proceed to trial.

Full Update

Disputes arose between John Holland as Main Contractor and Hunter Valley as Subcontractor for additional payments for delays caused by the Main Contractor, relating, in particular, to the provision of timely access to the site.

The disputes were referred to arbitration and the arbitrator found an entitlement for delay costs and made an award in Hunter Valley's favour.

John Holland sought leave to appeal the arbitrator's award in particular on the basis of the arbitrator's acceptance of a "global claim" which, it was submitted, was not recognised in law.

The court held that the application for leave to appeal the arbitrator's award should be refused.

The court stated that the term "global claim" was a "short hand" method of describing a claim which does not readily permit the individual identification of each of its component parts.

After reviewing the precedents, the court concluded that the ability of a defendant to strike out a global claim would depend upon the capacity of the Plaintiff to provide necessary particulars of its claim. However, a Plaintiff who has a claim will not be denied the opportunity of prosecuting the claim merely because there may be difficulty in identifying with precision each individual element of the claim.

The question of whether a claim will ultimately succeed at trial will depend upon the evidence adduced in support of it and if the evidence demonstrates that the Plaintiff has suffered a quantifiable loss, then it is open to the court to make a decision in an amount which it considers to be appropriate, even if the claim is a "global claim".

It was therefore held that as the arbitrator was satisfied on the evidence put before him that the claim was justified in the amount which he determined as being appropriate, the application for leave to appeal the arbitrator's award would be refused.

The decision in John Holland supports the position adopted by the English courts in a number of recent decisions where the success of a striking out application of a global claim will depend upon the capacity of a Plaintiff to provide particulars of its claim.

A Plaintiff pursuing a global claim will not be denied the opportunity of proceeding with that claim to trial merely because there may be difficulty in identifying each individual element of the claim.

Whether or not a global claim will succeed at trial will depend on the evidence which can be produced in support of it at the trial itself, but where it can be demonstrated in the defence of a striking out application that a quantifiable loss has been sustained, then the courts will often be prepared to allow it to proceed to trial.

While this decision does not detract from the general principle that it is difficult for unparticularised global claims to succeed at trial, it does nevertheless support the general proposition that the courts are loath to prevent a claimant from proceeding to trail on the basis of a global claim, even in circumstances where a claimant is unable to plead the causal nexus between a delay event and the loss which is sought to be recovered.

The contents of this article are intended to provide a general guide to the subject matter and should not be treated as a substitute for specific advice concerning individual situations.