ATL (Australia) Pty Limited v Cui - [2021] NSWSC 1372

Supreme Court

New South Wales

Medium Neutral Citation: ATL (Australia) Pty Limited v Cui and Ors [2021] NSWSC 1372
Hearing dates: 26 October 2021
Date of orders: 26 October 2021
Decision date: 26 October 2021
Jurisdiction: Common Law
Before: Johnson J
Decision:
The Second Defendant is granted leave to amend the Defence subject to conditions.

Catchwords:
CIVIL PROCEDURE – claim against guarantors under commercial loan agreement – late application by defendant to amend Defence – proposed amendment relying upon principles in Ankar Pty Ltd v National Westminster Finance (Australia) Pty Ltd (1987) 162 CLR 549; [1987] HCA 15 – plaintiff notified of amendment application on eve of hearing – late realisation by defendant that Ankar defence may be available – one letter in a sea of documents - application of ss 56-58, 64 Civil Procedure Act 2005 – belated application – consideration of dictates of justice – leave to amend granted on conditions

Legislation Cited:
Civil Procedure Act 2005

Cases Cited:
Ankar Pty Ltd v National Westminster Finance (Australia) Pty Ltd (1987) 162 CLR 549; [1987] HCA 15
Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175; [2009] HCA 27
Westpac Banking Corporation v Robinson (1993) 30 NSWLR 668

Texts Cited:
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Category: Procedural rulings
Parties: ATL (Australia) Pty Limited (Plaintiff)
Jinsong Cui (First Defendant)
Jeffrey Tse Hung Lee (Second Defendant)
Tse En Tang (Third Defendant)
Liang Zhao (Fourth Defendant)
Gondon HLHS Pty Ltd (Fifth Defendant)
HLHS Partners Epping Pty Ltd (Sixth Defendant)
Arise Building Pty Ltd (Seventh Defendant)
Tang Asset Management Pty Ltd (Eighth Defendant)
Lansha Asset Management Pty Ltd (Ninth Defendant)
Lee’s Asset Management Pty Ltd (Tenth Defendant)
Arise Group Pty Ltd (Eleventh Defendant)
Representation:
Counsel:
Mr AC Casselden SC; Mr WR Chan (Plaintiff)
Mr DA Smallbone (on amendment application); Mr JM Wheeldon (Second Defendant)
Mr M Wang, solicitor (Eleventh Defendant)
Solicitors:
Dentons (Plaintiff)
Accuro Maxwell (Second Defendant)
Juris Cor Legal (Eleventh Defendant)

File Number(s): 2018/393537
Publication restriction: ---

Judgment

JOHNSON J: By Notice of Motion dated 25 October 2021, the Second Defendant, Jeffrey Tse Hung Lee, seeks the leave of the Court to rely upon a draft Third Further Amended Defence (“the draft Amended Defence”) in proceedings commenced by the Plaintiff, ATL (Australia) Pty Limited.
By Statement of Claim filed on 21 December 2018, the Plaintiff seeks to recover a sum in excess of $13 million from 11 named Defendants.
On 11 November 2020, the proceedings were listed for hearing to commence yesterday, 25 October 2021, with a seven-day estimate.
By the time the hearing was called on yesterday, only two Defendants appeared to defend the Plaintiff's claim, the Second Defendant and the Eleventh Defendant, Arise Group Pty Ltd. With respect to other Defendants, default judgment has been obtained against some and a number of the individual Defendants are bankrupt. One other Defendant, being the Tenth Defendant, Lee’s Asset Management Pty Ltd, did not appear and the hearing of the Plaintiff's claim against that Defendant is to proceed by…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2021] NSWSC 1372
Decision Date: 26 October 2021

CaseChat Overview and Summary

The case of ATL (Australia) Pty Limited v Cui involved a commercial loan agreement where the plaintiff, ATL, sought a claim against the guarantors, including Cui. The dispute centred on the guarantors' liability under the agreement and the defendants' attempt to amend their defence late in the proceedings. The matter was heard in the Supreme Court of New South Wales. The defendants, including Cui, sought to amend their defence to rely on the principles established in the case of Ankar Pty Ltd v National Westminster Finance (Australia) Pty Ltd. The application to amend was made on the eve of the hearing, and the plaintiff was notified only shortly before the proceedings were to begin.

The primary legal issue before the court was whether the defendants should be permitted to amend their defence despite the late application. The court had to consider the provisions of sections 56-58 and 64 of the Civil Procedure Act 2005, which govern the amendment of pleadings. The court also needed to assess whether the proposed amendment was likely to succeed on its merits and whether allowing the amendment would cause injustice to the plaintiff. The court examined the Ankar principles, which provide a defence to guarantors in certain circumstances, and considered the circumstances surrounding the late application, including the plaintiff's notice of the amendment and the potential impact on the trial.

The court found that the application to amend was belated, but given the circumstances, it was appropriate to grant leave to amend on certain conditions. The court observed that the Ankar defence might have been available to the defendants and that one letter among many documents could not be the sole reason for the delay. The court applied the principles of fairness and justice, taking into account the overall context of the case and the potential merits of the proposed defence. Ultimately, the court granted leave to amend, subject to conditions that ensured the plaintiff would not be unfairly prejudiced by the delay. The court's decision balanced the need for procedural fairness with the imperative to reach a just outcome in the case.

Orders