Jettisoning the case formerly pleaded and leave to amend

JM Kelly (Project Builders) Pty Ltd v Toga Development No.31 Pty Ltd (No 4) [2010] QSC 111

 

A trial was scheduled for 4 weeks, commencing 10 May 2010, to narrow some of the issues in this protracted litigation, which has spanned several years.

On a application by the plaintiff to amend their pleadings to in effect ‘jettison’ the case formerly advanced, not by changing the material facts, but by formulating an alternative claim in restitution and quantum meruit.

The previous case was the contract between the parties was not the formal contracted which had been executed, but rather a series of agreements following, and furthermore, certain representations had been made, which had been relied upon to the plaintiff’s detriment. Accordingly, there was also a Trade Practices Act claim.

The explanation for delay in changing the forensic course of the case was the plaintiff changed legal advisors in late 2009, and Mr Sofronoff QC and Mr Piggott reviewed the material and ‘baldly and frankly’ informed his Honour Daubney J that the case as pleaded was ‘untenable’.

His Honour considered the principles for rectification of a contract:

In Pukallus v Cameron [1982] 180 CLR 447, Wilson J at 452 summarised the principles which govern rectification of a contract. Relevantly for present purposes, his Honour said (omitting citations):

“The second principle governing the rectification of a contract which is material to this case is that which requires the plaintiff to advance “convincing proof” that the written contract does not embody the final intention of the parties. The omitted ingredient must be capable of such proof in clear and precise terms. The court must not assume for itself the task of making the contract for the parties.”(underlining added)

His Honour was satisfied that a previously provided schedule of some 390 pages with hyperlinks and cross referencing to other documents satisfied the requisite test:

“I am not persuaded that the particulars of the plaintiff’s claim, found in the schedule and responded to in the schedule, have not served the necessary purpose of defining the issues and preventing surprise at trial, or to enable the defendant to plead a defence (UCPR Rule 157).”

The remaining arguments were framed in terms of the defendant’s ability to adequately respond in time for trial. His Honour relied on Aon Risk Services Australia Limited v Australian National University [2009] 239 CLR 175, and held:

“Amendments should, where possible, be allowed to enable the true issues to be ventilated. Whether the circumstances are such as to permit the amendment requires an assessment of all the relevant circumstances including delay, wasted costs, the effects on the parties, the effect on the court and other litigants, the nature of the amendment, the importance of the amendment, the stage at which the application is made, and any explanation for the delay”

Conclusion

His Honour allowed the amendment and allowed the trial to proceed on the basis of particularised schedule having been in play for some time, despite objections:

“Mr Inatey SC who appeared with Mr Clothier for the defendant submitted that the defendant had not worked this aspect of the case up to the degree required because, in effect, the defendant was so confident that the plaintiff’s previously pleaded case was so hopeless that the application of time and resources on this issue was not warranted. Be that as it may, as I’ve already said, it is obvious from a review of the schedule that a significant amount of work has in fact been undertaken already on this task.”

With respect to the remaining issues, his Honour considered the defendant ‘may be either misapprehending or inadvertently overstating the work that needs to be done in order to meet” the plaintiff’s case, and accordingly allowed the amendments and trial to proceed.

Brisbane Barrister – David Cormack.

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