The thought of initiating court proceedings is a daunting one. Clients need to weigh up the cost of litigation and whether their circumstances allow for sometimes stressful, often drawn-out court proceedings. There are however a number of alternate remedies available in certain circumstances, one of which is to obtain a declaration or declaratory judgment.
A declaration is an order made by a court that pronounces, with finality, the existence or non-existence of legal rights or obligations concerning the parties. It is a highly under-utilised remedy which, if used in the correct circumstances, can bring an end to disputes between parties in a matter of weeks as opposed to months or years.
Declarations can be made with respect to any number of matters including, but certainly not limited to:
1. the future conduct of a party;
2. the existence of a contract;
3. whether a contract has been breached or terminated;
4. whether an agreement is binding or not; and
5. the reasonableness of a form of notice.
Given the flexibility and procedural simplicity of this kind of remedy, as well as the broad jurisdiction and discretion the courts have in making declarations, it begs the question why this method of resolving disputes is not more frequently used?
Creevey Russell Lawyers recently represented a group of farmers in the Hampton area (Queensland) in a dispute with their local council. The dispute between the parties involved the purported termination of a Water Supply Agreement which had been on foot for a period of 15 years prior to the unlawful termination by the council.
The Hampton farmers attempted to negotiate with the council for over a year before they determined that they had no other option than to resort to the court system to settle the dispute. The issue of water security was and is for this group, paramount and they could not afford to be caught up in protracted court proceedings.
An application for declarations that the Water Supply Agreement was still on foot and binding on the parties was filed in the Supreme Court of Queensland on 25 August 2020. The matter was heard by Justice Martin on 1 September 2020. Solicitors for the council argued that a declaration was not the appropriate method of initiating the proceedings in this matter and contended that on this occasion the proceedings should have been initiated by way of the more commonly used ‘claim’ and ‘statement of claim’, an argument which ultimately failed.
On 9 September 2020, Justice Martin delivered his decision granting the declarations sought by the Hampton farmers and ordered that the council pay the Hampton farmers’ costs on an indemnity basis, the highest level of costs that can be awarded by the Supreme Court.