ACN 007 528 207 Pty Ltd (in Liq) v Bird Cameron (Reg) and Ors (No 7) No. Scciv-99-1392

[2003] SASC 115

ACN 007 528 207 PTY LTD (IN LIQUIDATION) V BIRD CAMERON (REG) AND ORS (NO 7)

[2003] SASC 115

1. JUDGE BURLEY. These reasons relate to an application by the plaintiff for leave to file a sixth further amended statement of claim, a copy of which is Exhibit RKB1 to the affidavit of Mr Beissel sworn on 11 March 2003. The application follows on from a previous application for leave to amend dealt with by me. That application was refused and reasons for refusal were published on 27 November 2002 (Judgment No [2002] SASC 392). As appears from paragraph 16 of those reasons, the whole of the application was refused notwithstanding that some of the proposed amendments were legitimately pursued. I took that course because I wished to avoid the piecemeal addition of amendments to the statement of claim. The application for leave to amend the subject of these reasons includes all amendments now pursued by the plaintiff, a number of which are not opposed by the defendants. In these reasons I will only deal with those matters raised in the sixth amended statement of claim which were the subject of opposition by the defendants.

2. In my reasons of 27 November 2002 I indicated that I would afford one final opportunity to the plaintiff to seek leave to amend.  The application the subject of these reasons is that final application.

3. The defendants’ opposition to the amendments is summarised in paragraph 2 of their written submission dated 7 March 2003.  First, the defendants asserted that the amendments to paragraphs 1.9(a)(ii) and 4.1 were otiose because they were “fashioned as alternatives” whereas, as a “consequence of the proposed amendments, and earlier amendments, ... they no longer amount to alternatives”.  This contention was not elaborated upon during oral argument.  As I understand the structure of the pleading, paragraph 1.9(a)(ii) is an alternative to paragraph 1.9(a)(i).  The assertions in the former paragraph are not the same as the assertions in the latter and, consequently, the pleading in paragraph 1.9(a)(ii) cannot be said to be otiose.  Accordingly, I disallow that objection.

4. As to paragraph 4.1, the last sentence of that paragraph commences:

   “In the alternative pleaded in this sub-paragraph ...”

5. The use of such wording is confusing because I do not understand the plaintiff to be raising a plea in the alternative.  As I understand it, the last sentence of paragraph 4.1 is meant to be a comment “in relation to” the alternative pleaded in that sub-paragraph.  So understood, the defendants’ contention that the pleading is otiose is not correct.

6. The next category of amendments which are opposed by the defendants are referred to in paragraphs 5 to 27 of the defendants’ written submission.  The paragraphs which are opposed are 1.9(a)(i)1-6, 1.13, 1.15, 3.7, 3.8, 4.4, 4.4(d), 4.5, 5.2, 5.3, 5.4, 5.6, 5.7 and 6.4.  I will put to one side for the moment paragraphs 1.9(a)(i)1-6 and deal with them when I turn to the question of how agency has been pleaded.  What is common to most of the other paragraphs is the inclusion of the passage:

   “... the first defendant acting either directly to 15 December 1989 and thereafter via its agent the second defendant or via its agent the second defendant from September 1989 and the second defendant as agent for the first defendant from September 1989 or 15 December 1989 or the second defendant on its own behalf ...”

7. There follows in most instances an allegation of certain acts which form part of the plaintiff’s case that wrongful conduct has been engaged in by the relevant defendant.

8. The defendants complain that the plaintiff has failed in these paragraphs to adequately put its case that, as the various partnerships alleged to have traded under the name Bird Cameron (Reg) evolved, the members of those partnerships became liable for the various wrongful acts referred to in the statement of claim.  Mr Strawbridge, counsel for the defendants, submitted that a partnership is dissolved when the constitution of the individuals comprising the partnership is changed either by retirement, death, etc or by the addition of a new partner.  When the constitution of a partnership is changed the new partnership thereby formed is not responsible for the liabilities of the older partnership.  I accept those propositions as being correct.  However, it is arguable that the plaintiff’s claim against the defendants is not to be determined solely by reference to those principles.

9. The thrust of the plaintiff’s case is that a group of individuals from time to time constituted a partnership under the name Bird Cameron (Reg) and that for some of the relevant periods traded through the second defendant, BPM Pty Ltd.  It is part of the plaintiff’s case that the plaintiff was initially the client of Bird Cameron (Reg) and later the client of the second defendant.  Whilst that summary is an over-simplification, it serves to demonstrate that the plaintiff, by its pleading, seeks to implicate members of the various partnership over the relevant periods in respect of alleged wrongful acts engaged in by certain of the partners, and for whose acts the other partners are jointly and severally liable, even though the other partners might have been unaware of the actions of those individuals or, indeed, of the existence of the plaintiff.

10. The specifics of the alleged liability attributed to those individuals are set out in Schedule A to the statement of claim.  Whilst I accept that it is an onerous task for those individuals to trace through the schedule and the paragraphs of the statement of claim referred to therein, it is also a convenient shorthand method of pleading the case in respect of those individuals.  To that extent I consider that the pleading is adequate, bearing in mind that it is not my function to determine finally points which are to be decided at trial.  My task is to determine whether or not what is pleaded is comprehensible and raises an arguable case.  In my view, the paragraphs the subject of attack in the second category identified as paragraph 2.2 of the defendants’ written submission are, subject to one matter, adequately pleaded.

11. The matter to which the above ruling is subject relates to the adequacy of the pleading of agency by the plaintiff.  This is the third category of opposition identified at paragraph 2.3 of the defendants’ written submission.

12. When I considered the fifth amended statement of claim, the subject of my reasons of 27 November 2002, I disallowed the amendments setting up the pleading of agency because they were pleaded as particulars.  At paragraph 7 of my reasons I said: “it is inappropriate, because it is confusing, to introduce that cause of action by way of particulars in support of the paragraph which does not of itself raise agency”.

13. In order to meet that criticism the plaintiff has, in the sixth amended statement of claim, pleaded agency in its own right in essentially the same terms as the particulars originally provided in the fifth amended statement of claim.  In relation to those particulars I said in my reasons of 27 November 2002, at paragraph 8:

    “The defendants also argued in opposition to these amendments that the plaintiff has not sufficiently pleaded all of the elements of agency which make up a cause of action based on agency.  If the effect of this argument were that the proposed pleading failed to disclose a cause of action based on agency, it would provide an additional ground rejecting this aspect of the proposed amendments.  However, it seems to me that the facts pleaded in the proposed particulars sufficiently disclose a cause of action based on agency.  It would be a matter for the trial Judge to decide in light of not only the pleadings but the evidence adduced and submissions put at trial as to whether or not a cause of action in agency has been made out.”

14. In my view that statement applies with equal force to the pleading of a cause of action based on agency in the sixth amended statement of claim.

15. For the above reasons I consider that the plaintiff ought to be given leave to file and serve the sixth amended statement of claim.  I should add that I have not attempted to traverse all of the submissions put by both counsel in respect of the application.  Rather, I have attempted to summarise the essence of the respective positions of the parties and make a ruling accordingly.  I have formed the view that none of the submissions put by Mr Strawbridge in opposition to the amendments referred to in paragraph 2 of his written submission either individually or in combination require the disallowance of any of the amendments which were opposed.