Carbotech-Australia Pty Ltd v Yates

[2008] NSWSC 1150

CITATION:	Carbotech-Australia Pty Ltd v Yates [2008] NSWSC 1150
HEARING DATE(S):	10 October 2008
JURISDICTION:	Equity Division
JUDGMENT OF:	Brereton J
EX TEMPORE JUDGMENT DATE:	10 October 2008
DECISION:	Leave granted to amend Statement of Claim.
CATCHWORDS:	PROCEDURE – application to amend Statement of Claim – whether plaintiff has sufficiently particularised claim against defendants – where plaintiff endeavours to preserve ability to enlarge claim
CATEGORY:	Procedural and other rulings
PARTIES:	Carbotech-Australia Pty Ltd (P1) Ground Consolidation Pty Ltd (P2) Minova International Pty Ltd (P3) Ian Kenneth Yates (D1; XD1 in XC1; XD2 in XC2; XP1 in XC3) Donna Yates (D2; XD2 in XC1; XD3 in XC2; XP2 in XC3) Eligild Pty Ltd (D3; XD3 in XC1; XD4 in XC2; XP3 in XC3) Ron Godfrey Nielsen (D4; XD4 in XC1; XD5 in XC2; XP4 in XC3) SES Resources Pty Ltd (D5; XP1 in XC1; XD6 in XC2) SES 2005 Pty Ltd (D6; XP2 in XC1; XD7 in XC2) Wombat Holdings (NSW) Pty Ltd (D7; XD5 in XC1; XD8 in XC2; XP5 in XC3) Global Resins Pty Ltd (D8; XP3 in XC1; XD9 in XC2; XD3 in XC3) SES International Ltd (D9; XP4 in XC1; XD10 in XC2) Mark Weston (D10; XD6 in XC1; XD1 in XC2; XD6 in XC3) Era Polymers Pty Ltd (D11; XD7 in XC1; XP1 in XC2) Era Polymers Holdings Pty Ltd (D12; XD8 in XC1; XP2 in XC2) Geoffrey David Mellon (D13; XD9 in XC1; XD11 in XC2; XD9 in XC3) SES Holdings Plc (D15; XP5 in XC1; XD13 in XC2)
FILE NUMBER(S):	SC 3813/05
COUNSEL:	Mr W G Muddle SC w Mr S A Goodman & Mr J A Arnott (Ps) Mr I K Yates (in person) (D1-3) Mr A J Bulley w Mr C J M Palmer (D4, 7) Mr J K Kirk (D5, 6, 8, 9, 15) Mr C D Freeman (D11, 12)
SOLICITORS:	Clayton-Utz (Ps) Cameron & Myers (D4, 7) Allens Arthur Robinson (D5, 6, 8, 9, 15) Photios Vouroudis & Co (D11,12)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

BRERETON J

Friday 10 October 2008

3813/05 Carbotech-Australia Pty Limited & ors v Ian Kenneth Yates & ors

JUDGMENT (ex tempore – re application for leave to further amend the Statement of Claim)

1 HIS HONOUR: The plaintiffs seek leave to further amend the Statement of Claim in the form of a document entitled "Third Further Amended Statement of Clam" which I shall initial and date this day. The substance of the proposed amendments would be to include in Part 7 of the Statement of Claim claims against "the conspiring parties" for damages under (CTH) Corporations Act 2001, s 1317H – in addition to the claim under s 1324, which is already pleaded - on the basis that they were persons involved in contraventions of Corporations Act, s 182(1) - not only by Mr Yates, which is already pleaded, but also by Messrs Nielsen and Mellon.

2 The further amended summons, leave to file which was granted at the beginning of the hearing, already claims, in paragraph 5A, a declaration that the conspiring defendants have inter alia contravened s 182 as persons involved in contraventions by Mr Yates, Mr Nielsen and Mr Mellon. The allegation that would now be pleaded in paragraph 177, if amended, would simply allege the conclusion which is reflected in that claim in the further amended summons. It cannot, therefore, come as a serious surprise.

3 The defendants - led by, but not limited to, the SES defendants - object that the proposed amended pleading does not sufficiently particularise the contraventions of s 182 alleged against Messrs Nielsen and Mellon. I am inclined to accept that the reference, in paragraph 177, to "the matters alleged in Part 3 above" is insufficient to particularise those contraventions, because a perusal of Part 3 does not readily disclose the contraventions alleged against each of those defendants. It may be too late now for the defendants to complain about the insufficiency, if it be that, of the allegations in respect of Mr Yates, because they have been on the record for many months with objection being raised only shortly before the commencement of the trial. But now that additional allegations of accessorial liability on the part of, inter alia, the SES defendants are made, in respect of contraventions by Mr Nielsen and Mr Mellon, there is force in the argument that the defendants are entitled to have the contraventions alleged against those gentlemen which are said to found accessorial liability, properly particularised.

4 In the flurry of correspondence which has ensued from the foreshadowing of this application, the plaintiffs’ solicitors Clayton Utz, in a letter of 10 October 2008, responding to a request, "In what respects and on what occasions is it alleged that each of Messrs Yates, Nielsen and Mellon improperly used their positions as alleged by paragraph 177", asserted that it should be apparent on the evidence, which they did not propose to rehearse, but proceeded "without being exhaustive" to summarise what was alleged.

5 It is, of course, not a sufficient answer to an objection to a pleading or a request for particulars that matters which ought to be pleaded or particularised are apparent on the evidence. And while it is, to a substantial extent, understandable that in a case of an alleged concealed fraud, the plaintiff will not be in a position fully to particularise everything that it might wish ultimately to rely upon, nonetheless it must particularise, as best it can, its case.

6 As I read the letter of 10 October 2008, its purport is to particularise, as best the plaintiff can, the allegations it makes in respect of Messrs Yates, Mellon and Weston, on which it relies to found a case of accessorial liability against inter alia the SES defendants, while seeking to preserve the ability to broaden those allegations as the case proceeds. If the letter of 10 October 2008 is treated as the particulars of the allegations in respect of Mr Nielsen and Mr Mellon for present purposes, then it seems to me that the amendments cannot be said to be embarrassing or prejudicial. Whether the plaintiff should be permitted hereafter to broaden those allegations will be a matter to be judged from time to time, depending on how the evidence emerges and depending on what, if any, prejudice is occasioned thereby.

7 So far as the claim for damages is concerned, the defendants object that the plaintiffs have not particularised with specificity the amount of damages they claim. That is so in respect of the present pleading, and I do not see that the proposed amendment makes the slightest difference to that.

8 But for this application, I would have been inclined to the view that the plaintiffs’ claim was for damages equivalent to the lost profits from the Springvale contract for a period of a year (from April 2005 until March 2006). The effect of this application has been, if anything, to put the defendants on notice of a potentially somewhat longer period of claim, extending until SES ceased to perform the Springvale contract in about June 2006. In my view, the defendants are entitled to proceed on the basis that, until or unless otherwise notified, the plaintiffs’ claim is for what they say it is “not less than”, namely the period during which SES Resources did work for Springvale, which is a period of about 15 months. Whether the plaintiffs ought to be permitted to enlarge that claim will again be a matter to be judged, if and when it arises, depending on the course of the trial.

9 At this stage, therefore, the letter of 10 October 2008 should be treated as the relevant particulars of the plaintiffs’ claim and, insofar as it seeks to preserve opportunities for expansion of the claim - whether of the allegations of contraventions, or of the claim for damages - it does no more than indicate that the plaintiffs might, at a later stage, if evidence emerges to justify it, seek to provide further particulars; whether in that event they should be permitted to rely on any such further particulars can be determined then.

10 On that approach, the presently proposed amendments, if permitted, will not occasion significant prejudice to the defendants. If any defendant asserts that Mr Mellon - or, for that matter, any other witness - ought be recalled for further cross-examination in the light of the amendments, then, without foreclosing argument on the topic, it is likely that such an application would receive a very favourable hearing, so long as some connection with the amendment can be demonstrated; indeed Mr Muddle SC for the plaintiffs has offered to recall Mr Mellon if required.

11 I grant leave to the plaintiff to further amend its statement of claim by filing a document in the form of that entitled Third Further Amended Statement of Claim, initialled by me, dated this day and placed with the papers.

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