A court exercising discretion to strike out a counterclaim for non-compliance with interlocutory orders must evaluate relevant discretionary considerations including the balance of prejudice to the respective parties, the reasonableness of explanations for non-compliance, and whether alternative orders of less impact may be more suitable. Failure to do so constitutes an error in the exercise of discretion warranting appellate intervention. The question whether s 64 of the Civil Procedure Act 2010 (Vic) must be considered by a court of its own motion whenever an application is made under s 63 was left open.
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