The introduction of Civil Procedure Act 2010 (Vic) (‘CPA’) blew fresh wind into various areas of the Victorian civil procedural law. One of the developments concerned the CPA test warranting summary judgment.
The criteria under the previous test was whether the claim, defence or counterclaim was "hopeless" or “bound to fail". Under the new test pursuant section 63 of the CPA a court may give summary judgment if the claim, defence or counterclaim would have "no real prospect of success" at trial.
Five years since the CPA commenced, the Courts are discussing the wording around the interpretation of the test. It has been noted that in most cases there is no practical difference in the application of the old and new tests. However, the new test has been seen as liberalising the basis upon which a summary judgment now may be obtained. This more liberal approach proved true with a recent Victorian decision granting summary judgment, which would not have been granted under the old test.
Application of new test
The question posed by the Victorian judges determining a summary judgment is 'does the claim/defence have a real prospect of succeeding at trial?' If the claim/defence does not have a real prospect of success the Courts are able to strike it out and dispense with the proceeding summarily.
What is a real prospect of succeeding at trial?
The recent Victorian decisions have found this to be:
- the claim / defence has a ring of credibility, being prima facie plausibility, that merits further investigation.
- a case does not need to have a probability of succeeding to avoid summary judgment; its prospect of success will be real even if it is less than 50%.
- the appeal has a ‘real’ as opposed to a ‘fanciful’ chance of success.
Regarding the 'real' as opposed to 'fanciful' chance of success, it has been noted that there is no bright line that divides the two, nor is it useful to devise other categories using terminology deployed in other situations.
Further, there may be cases where the prospects of the appeal are real, but no substantial injustice will be done if summary judgment is granted. This may be particularly so when the appeal is from an order as to practice and procedure."
The takeout from the recent Victorian summary judgments
The test applicable under s.63 of the CPA enables parties to seek summary disposal of a proceeding where there is no prima facie plausibility of the claim / defence such that further investigation is warranted. This test is stricter on the party seeking to have the claim / defence investigated by way of trial. Under the old test a party merely had to show an arguable prospect of success in their claim / defence to defeat a strike out application and have the matter proceed to trial.