Chan v Trevor - [2005] WASC 276

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: CHAN -v- TREVOR & ANOR [2005] WASC 276

CORAM: SIMMONDS J

HEARD: 16 NOVEMBER 2005

DELIVERED : 15 DECEMBER 2005

FILE NO/S: CIV 2206 of 2001

BETWEEN: SENG FAI CHAN
Plaintiff
AND
DOUGLAS TREVOR
JOHANNA BEATRIX TREVOR
Defendants

Catchwords:

Practice and procedure - Application to amend statement of claim - Whether interests of justice preclude leave to amend statement of claim - Whether proceedings show flagrant disregard for case flow management - Turns on own facts

Defamation - Application to amend statement of claim - Whether imputations capable of being conveyed by words complained of - Whether pleadings repetitive and embarrassing - Turns on own facts

Legislation:

Nil

Result:

Application allowed

Category: B

Representation:

Counsel:

Plaintiff: Mr R J L McCormack
Defendants: Ms C Galati

Solicitors:

Plaintiff: Stables Scott
Defendants: Edwards Wallace

Case(s) referred to in judgment(s):

Chan v Trevor & Anor [2004] WASC 206
Chan v Trevor & Anor [2004] WASC 53
Jones v Skelton [1963] 1 WAR 1362
Lewis v Daily Telegraph Ltd (1964) AC 234
Mirror Newspapers Ltd v Harrison (1982) 149 CLR 293

Case(s) also cited:

Atkinson v Fitzwalter [1087] 1 All ER 483
Birmingham v West Australian Newspapers Ltd [1999] WASC 19
Capital and Counties Bank v George Henty & Sons [1882] 7 AC 741
Drummond-Jackson v British Medical Association [1970] 1 All ER 1094
Favell v Queensland Newspapers Pty Ltd (2005) 221 ALR 186
Hawkins v Clayton (1988) 164 CLR 539
Hooker Corp Ltd v Commonwealth (1986) 65 ACTR 32
Morford & Ors v Rigby & Anor [1998] EWCA Civ 263
Sinclair v James [1894] 3 Ch 557
Smith v Walker [1912] SC 224
Stokes v Cowan [2004] WASC 173
Taylor v Jecks (1993) 10 WAR 309
Tony Sadler Pty Ltd v McLeod Nominees Pty Ltd (1994) 13 WAR 323

SIMMONDS J:

Introduction

This is an application by the plaintiff for leave to amend his statement of claim. This is not his first such application. On the first, Chan v Trevor & Anor [2004] WASC 53, Newnes M granted leave in terms of a minute supplied, with certain exceptions. I call this decision "Chan No 1". Subsequently, the plaintiff lodged an amended substituted statement of claim. The defendants then applied to strike out certain paragraphs of that pleading, and in Chan v Trevor & Anor [2004] WASC 206 Newnes M struck out certain of the objected to paragraphs while allowing liberty to replead. I call this decision "Chan No 2". Subsequently, the plaintiff filed the present application in respect of what is the third form of his statement of claim. This third form is the Minute of Proposed Amended Substituted Statement of Claim, dated 1 December 2004, but filed 9 August 2005.
The defendants strongly resist the present application, on two bases. Firstly, they say the application is not in the interests of justice, and leave should not be granted. This is as the history of the matter shows the plaintiff's "flagrant" disregard of the principles of case flow management. Secondly, the defendants say leave should not be granted in respect of certain paragraphs of the proposed pleading, as those paragraphs are defective. This is in the sense that those paragraphs, if in filed pleadings, would be liable to be struck out under O 21.
In this decision I first consider the history of the underlying proceedings, so as to permit me to consider in particular the objection to leave being granted that rests on the interests of justice. I then consider the pleading issues.

Background and the Interests of Justice Issue

The underlying proceedings are an action for defamation. The plaintiff is a legal practitioner. The plaintiff's action has a lengthy history characterised by significant delays. The decision of Newnes M in Chan No 1, (supra) delivered on 31 March 2004, following a hearing on 15 March 2004, sets out the history up to the hearing date, in considerable detail. That decision relieves me of the need to go into comparable detail for that period. I provide greater detail for the subsequent period when, regrettably, there have been further delays.
The plaintiff's action was commenced on 21 August 2001, and "for reasons that are not adequately explained" (Chan No 1, Newnes M at [2]) the writ was not served until 9 March 2002. It was followed by a statement of claim filed on 22 May 2002, claiming damages for libel in respect of a letter dated 25 February 1997 from the Legal Practitioners Complaints Committee. I refer to that body as the "Committee". I set the letter out in full as part of my reproduction of the proposed statement of claim below. The 22 May 2002 statement of claim pleaded that the letter was published some time between June and October 1997, by the defendants to another legal practitioner in a law firm, "and, by virtue of that publication two others in the recipient's firm" (Chan No 1, Newnes M, at [2]).
There was then an initial status conference, which the plaintiff did not attend, and a mediation conference, which his then solicitor attended, but he did not. Between the two, the defendants instructed solicitors who informed the plaintiff of various objections to his statement of claim. On 22 October 2002, approximately a month after the mediation conference, and following the failure of a promised amended statement of claim to appear within the promised period, or a subsequently consented to extension, the defendants filed an application to strike out the statement of claim.
On 6 March 2003, the plaintiff filed and served a minute of proposed substituted statement of claim. This was some three weeks after the due date set by an order at a status conference held on 28 January 2003. The defendants made objections to this proposed statement of claim. Following the failure of the plaintiff to file and serve a fresh minute of amended substituted statement of claim within either of the dates set by two further status conferences, an order was made that, unless by 4 June 2003 the plaintiff complied with the most recent order, his statement of claim should be struck out and his action dismissed. On 4 June 2003, the plaintiff filed an application for leave to file a substituted statement of claim.
Following the failure by the plaintiff to file and serve submissions and a list of authorities in support of the plaintiff's application of 4 June 2003 within either of the dates set by two further sets of orders, an order was made that, unless by 20 February 2004 the plaintiff filed those documents, his action would be dismissed. On 20 February 2004 the documents were filed.
To the point of the hearing before him on 15 March 2004 in Chan No 1, as Newnes M noted in his reasons, there had been a series of delays for which the plaintiff had proffered various reasons. The learned Master said this about those delays and those reasons ([16] – [18]):
"It is unnecessary for present purposes to canvass the litany of reasons offered by the plaintiff for the various delays. They include oversight or error, his urgent attendance on client matters, his solicitor's urgent attendance on other clients' matters and, predominantly, the illness of his solicitor.
Suffice it to say that whatever the merits of the explanations in respect of individual steps in the action - and a number of the delays remain unexplained - viewed as a whole there can be no reasonable excuse for the egregious delay that has occurred in prosecuting this action. The plaintiff has regularly been in default of orders of the court. On two separate occasions springing orders have been made against him. Apart from those springing orders (both of which were complied with on the last day) it is difficult to find a time limit with which the plaintiff has complied.
As a legal practitioner the plaintiff must have been well aware of his obligation as a plaintiff to comply with time limits and to prosecute the action with reasonable diligence. He must also have been aware that the fact his solicitor was ill for an extended period of time was not a reason to allow the action to languish but required him to engage other solicitors if the matter could not be properly progressed."
On 16 April 2004, following his decision in Chan No 1, Newnes M ordered that the plaintiff have leave to file and serve a substituted statement of claim in the form of the further minute of proposed substituted statement of claim filed on 6 February 2004, save for certain paragraphs, and with liberty to replead. He also ordered that, unless by 7 May 2004 the plaintiff filed and served a substituted statement of claim or amended substituted statement of claim, then the plaintiff's statement of claim would be struck out, his action dismissed, and judgment given for the defendants with costs.
On 3 May 2004, the plaintiff filed an amended substituted statement of claim. The defendants then applied to strike out certain paragraphs in this document, and this application was partially successful: Chan No 2 (supra). The decision was delivered on 22 September 2004.
On 6 October 2004 Newnes M extended the time within which the plaintiff was to file and serve an amended substituted statement of claim, to 1 November 2004. Counsel retained by the solicitor for the plaintiff was unable to settle the document by that date, owing to another matter in which he was involved being moved forward. By a facsimile dated 4 November 2004, the plaintiff's solicitor sought from the defendants' solicitor an extension of time to 12 November 2004. However, the defendants' solicitor replied by facsimile dated 9 November 2004 that their instructions were not to consent to any further extension of time, and they suggested that, if the proposed pleading was provided to them, they would provide comments.
Under cover of a letter dated 3 December 2004, the plaintiff's solicitors forwarded to the defendants' solicitors a Minute of Proposed Amended Substituted Statement of Claim dated 1 December 2004. This, it appears, is the document before me in this application. By facsimile dated 21 December 2004, the defendants' solicitors informed the plaintiff's solicitors they objected to certain paragraphs in that document.
It appears that the next event in these proceedings was a facsimile dated 27 April 2005 in which the plaintiff's solicitors informed the defendants' solicitors that the former did not concede the objections of the latter. The delay was explained to me in terms of the plaintiff's solicitors having taken annual leave, in combination with the pressure on them of other work, and pressure on counsel of his other work.
On 4 May 2005, the present application was filed, and this was followed by the filing, on 9 August 2005, of the Minute of Proposed Amended Substituted Statement of Claim referred to. It is not clear to me why the application and the minute were not together from the outset, nor why there was a delay in filing the minute. The application was of course necessary because an amended statement of claim was not filed as provided for in the order of Newnes M of 6 October 2004.
It would appear that delays after May 2005 until today are due in large part to difficulties in the availability of counsel, and I put those delays to one side, except to say this. Delays of that sort are one of the hazards of litigation that make important prompt compliance with the demands of case flow management.
On any view the pattern of events since the underlying proceedings were commenced, including the period since the delivery of the decision in Chan No 1, is of concern. The plaintiff had had his attention directed to concerns with delay in that decision. Explanations for the delay offered to me must be viewed in the context of the concerns so expressed. As will become apparent, the objected to paragraphs of the minute would not have come as a surprise to the plaintiff, nor it seems to me would it have been a difficult matter for the plaintiff to determine his position on those paragraphs. This is because, as will become apparent, they had been in issue in one form or another in both Chan No 1 and Chan No 2.
At the same time, I cannot conclude from the explanatory material before me that the plaintiff through his solicitors has acted in "flagrant" disregard of case flow management. There was a change of counsel for the plaintiff not long before the hearing in Chan No 1, as the decision of Newnes M indicates. The plaintiff changed his solicitors after Chan No 1. The initial efforts to advance the litigation were made that culminated in the amended substituted statement of claim filed 3 May 2004, and represented an improvement on what had been produced previously. I am also prepared to conclude that there was an improvement represented by the efforts to deal with the consequences of the inability to meet the 1 November 2004 deadline for an amended statement of claim to respond to Chan No 2.
The delay between the provision of a further statement of claim to the defendants' solicitors in early December 2004 and the date of filing the present application, 4 May 2005, remains of some concern, however. There is something in that delay of a repetition in a pattern of a loss of sight of the dictates of case flow management when other matters obtrude. This is of concern, given the plaintiff is himself a legal practitioner.
The approach to taking these matters into account in determining whether to grant leave to amend pleadings is most helpfully summarised by Newnes M in Chan No 1 at [10] as follows:
"The plaintiff now seeks leave to file a substituted statement of claim. The defendants say the application should be refused in light of the inordinate delay by the plaintiff and the prejudice the defendants would suffer. Counsel for the defendants referred to Tony Sadler Pty Ltd v McLeod Nominees Pty Ltd (1994) 13 WAR 323 as authority for the proposition that principles of case flow management under O 1 r 4A and r 4B should be taken into account by the Court in exercising a discretion to grant leave to amend a pleading. Counsel acknowledged, however, that that case must be read in light of the decision of the High Court in State of Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146 where it was held that case management principles could not be used to prevent a party from litigating an issue which was fairly arguable and that a party should be permitted to raise an arguable case provided any prejudice to the other party could be compensated by costs."
As will become apparent below, the plaintiff has advanced significantly further in pleading an arguable case. This factor weighs strongly in favour of not refusing a grant of leave on the basis put forward by the defendants. There is, however, the matter of prejudice to the defendants that must also be considered.
As to prejudice, there was evidence put before Newnes M for the purposes of Chan No 1 that continuation of the action was producing harmful levels of stress for the male defendant, and anxiety for the female defendant that was aggravating a number of her medical conditions. No further such material was filed. As in Chan No 1, there was no indication that the proposed amendments would (apart from the pleading issues they raise) themselves prejudice the defendants in any specific way. Of course, there is general prejudice to the defendants that may be seen to arise from delay in reaching pleadings for which they can assemble a response, such as justification or qualified privilege if open. However, pleadings in the respects objected to in the present application have been in issue, albeit in previous and disapproved of forms, in Chan No 1 and Chan No 2. Bearing that in mind, the matters of general prejudice referred to must be balanced against the interests of the plaintiff to which I have referred.
While the question is a close one, and the delay since the events of early December 2004 is a matter I have specially noted, I conclude that I should not in all the circumstances I have described dismiss the application for leave on the basis of the interests of justice. At the same time, I consider any further delays for which the plaintiff might be responsible not adequately explained in terms other than those proffered to date would pose significant risks for the continuation of the plaintiff's action, either at all, or in a form of their choosing. The plaintiff needs to take careful account of those risks.
This takes me to the pleading issues.

The Pleading Issues

For this purpose I need to set out the relevant parts of the pleadings. They are the paragraphs below:
"2.On a date unknown but between June and October 1997, the defendants published to:
2.1Carmel Galati ('Ms Galati'), a solicitor employed by Freehill Hollingdale & Page ('Freehills'); and/or
2.2William George Groves ('Mr Groves'), a partner of Freehills,
a copy of a letter of and concerning the plaintiff from Mrs V Seymour, Legal Officer, The Legal Practitioners Complaints Committee ('Committee') to Mr S F Chan dated 25 February 1997 in the following terms ('the letter'):
'Dear Mr Chan
Complaint: Ms J Trevor
The Legal Practitioners Complaints Committee considered this matter at a recent meeting.
The Committee considered the first complaint which was that you failed to advise Ms Trevor in 1983 that she was signing a mortgage document and failed to advise her of the amount of the loan secured by the mortgage for which she was liable.
The Committee found that the matters occurred some 14 years ago, and it would therefore be too difficult for the Committee to investigate the matter any further.
The Committee considered the second complaint that you provided Ms Trevor with a contract of sale and the transfer of land and led her to believe that the purchase price was $75,000 when in fact it was $100,000, and that you again told her in 1995 that the sale price was $75,000.
The Committee considered the transcript of the tape recording made of the conversation in 1995, which indicates that you were confirming the sale price was $75,000.
The Committee resolved that further investigation needs to be undertaken in respect of this matter and, in particular, a copy of the cheque for $100,000 needs to be obtained from you. Also, the documentation and bank statements relating to the moneys which Ms Trevor received, being her half share of the sale price, need to be obtained from her.
The Committee considered the third complaint which was that you failed to register the transfer of land in 1992 and failed to advise Ms Trevor of this, and also failed to discharge the old mortgage and register the new one.
The Committee considered that you were defacto acting for both parties, even if only on an informal basis, and it appeared that Ms Trevor was not advised that the transfer was not to be registered at the time of sale.
The Committee resolved to further consider this complaint once the investigation referred to in respect of the second complaint had been completed.
The Committee considered the fourth complaint which was that you advised Ms Trevor in writing in February 1996 that she no longer had an interest in the property when in fact her name is still on the title as registered proprietor and there is still a mortgage in place for which she is liable.
The Committee considered this letter to be misleading and considered that you had not been frank with Ms Trevor as to the true position, with the result that she had been misled as to the status of the sale of the property.
The Committee resolved to further consider this matter once the other investigations have been completed.
I therefore request that you obtain a copy of the original cheque from the bank and provide a copy to this office within 14 days.
Yours faithfully'
('the words complained of').
3.The words complained of meant and were understood to mean in their ordinary and natural meaning that:
3.1the plaintiff had deceived a client, namely Ms Trevor, in inducing her to believe that the purchase price of land was $75,000 when in fact it was $100,000 in a land transaction in which she was a party.
3.2the plaintiff was negligent in failing to register a transfer of land.
3.3the plaintiff was negligent in failing to advise his client, Ms Trevor, that he had failed to register a transfer of land.
3.4the plaintiff was negligent in failing to discharge the old mortgage and register the new one.
3.5the plaintiff misled his client, Ms Trevor, by advising her in writing that she no longer had an interest in a property when in fact her name was still on the title as registered proprietor and that there was still a mortgage in place for which the client was liable.
4.In consequence of the publication of the words complained of, the plaintiff has been injured in his character, credit and professional reputation and has been brought into public odium and contempt and has suffered distress and humiliation.
5.By reason of the following facts, matters and circumstances, the plaintiff claims exemplary damages against the defendants:
5.1The defendants published the words complained of knowing and intending that the words would have the tendency to reflect adversely on the plaintiff's professional reputation and credit.
PARTICULARS
The defendants' knowledge and intention is to be inferred from the fact that the words complained of are clear and unequivocal in their meaning.
5.2The defendants published the words complained of knowing and intending that the words bore, or were likely to bear, or that there was a risk that they would bear, the imputations pleaded in paragraph 3 hereof.
PARTICULARS
The plaintiff repeats the particulars to paragraph 5.1 hereof.
5.3The defendants published the words complained of knowing that the words complained of and the imputations were false or with reckless disregard as to whether they were true or false.
5.4At the time of publication of the words complained of, the defendants had in their possession a further letter from the Law Complaints Officer of The Legal Practitioners Complaints Committee dated 27 May 1997 which, in effect, advised that the complaints made by Ms Trevor had been considered by the Committee and that the Committee had not found the plaintiff guilty of any unprofessional conduct.
5.5The defendants published the words complained of out of spite and ill will to the plaintiff."

The changes from the previous filed statement of claim are principally to narrow the pleaded scope of publication and to separate out imputations in relation to the third complaint. These imputations are pars 3.2, 3.3 and 3.4, and are the only parts of the pleading with which issue is taken by the defendants.
The earliest form of the pleading in this respect was struck out in Chan No 1, on the basis it was embarrassing as rolling up a number of distinct imputations into one pleading (Newnes M, at [48] and [49]). The following form of the pleading was also struck out, in Chan No 2, because of its uncertain, confusing and embarrassing form (Newnes M at [27] – [32]). The matter of whether the Committee's letter was capable of bearing the imputations pleaded is expressly reserved in the latter decision (Newnes M at [33] and [34]).
The defendants' objections to pars 3.2, 3.3 and 3.4 rest on two bases. One basis is that the imputations pleaded are not reasonably capable of being conveyed by the Committee's letter. The other basis is that imputations of negligence are repeated twice, in pars 3.2 and 3.3, making those imputations embarrassing.
I deal with those bases separately.

Applicable Pleading Principles: Imputations Not Capable of Being Conveyed

There is a very useful statement of the general principles applicable to this basis for the defendants' objections contained in Chan No 1, Newnes M, at [36] – [38], which I set out below:
"The principles to be applied on an application of this sort are relatively well established. The Court will not grant leave to amend a pleading into a form which is liable to be struck out: Atkinson v Fitzwater [1987] 1 All ER 483, Sinclair v James [1894] 3 Ch 554. Imputations will be struck out at this stage if they are plainly incapable of being conveyed by the words complained of: Gumina v Williams (No 1) (1990) 3 WAR 342 at 346; Taylor v Jecks (1993) 10 WAR 309 at 319. In determining whether the defamatory imputations alleged are capable of being conveyed by the words complained of the usual starting-point is the well-known passage from the judgment of the Privy Council in Jones v Skelton [1963] 1 WLR 1362 at 1370 - 1371:
'In deciding whether words are capable of conveying a defamatory meaning the court will reject those meanings which can only emerge as the product of some strained or forced or utterly unreasonable interpretation. In Capital and Counties Bank v George Henty & Sons [1882] 7 AC 741, 745 Lord Selborne LC said:
"The test, according to the authorities, is, whether under the circumstances in which the writing was published, reasonable men, to whom the publication was made, would be likely to understand it in a libellous sense."
The ordinary and natural meaning of words may be either the literal meaning or it may be an implied or inferred or an indirect meaning: any meaning that does not require the support of extrinsic facts passing beyond general knowledge but is a meaning which is capable of being detected in the language used can be a part of the ordinary and natural meaning of words. See Lewis v Daily Telegraph Ltd [1963] 2 WLR 1063; [1963] 2 All ER 151 HL(E). The ordinary and natural meaning may therefore include any implication or inference which a reasonable reader guided not by any special but only by general knowledge and not fettered by any strict legal rules of construction would draw from the words. The test of reasonableness guides and directs the court in its function of deciding whether it is open to a jury in any particular case to hold that reasonable persons would understand the words complained of in a defamatory sense.'
There is, however, an important distinction to be drawn between a person's understanding of a publication and judgments or conclusions which that person may arrive at as a result of his or her own beliefs and prejudices. In that respect, Mason J said in Mirror Newspapers Ltd v Harrison (1982) 149 CLR 293 at 301:
'It is one thing to say that a statement is capable of bearing an imputation defamatory of the plaintiff because the ordinary reasonable reader would understand it in that sense, drawing on their own knowledge and experience of human affairs in order to reach that result. It is quite another thing to say that a statement is capable of bearing such an imputation merely because it excites in some readers a belief or prejudice from which they proceed to arrive at a conclusion unfavourable to the plaintiff. The defamatory quality of the published material is to be determined by the first, not by the second, proposition.'
In that case, it was held that a newspaper report which does no more than state that a person has been arrested and charged with a criminal offence is not capable of bearing the imputation that he is guilty or probably guilty of that offence."
It was suggested to me that the ordinary reasonable reader in this case should be understood in the context of the limited publication pleaded, to two legal practitioners. The standard, it was suggested, should be that of the ordinary reasonable legal practitioner. There is support for such an approach, it was submitted, to be found in some English authorities collected and discussed in "Gatley On Libel and Slander", 10th ed London, Sweet & Maxwell, 2004 at [2.12]. I was invited to apply this test, sometimes called the "target audience" test, to the suggested imputations.
However, to the extent the submission was an invitation to conclude that, whatever an ordinary reasonable person would understand of the letter, I should consider only what an ordinary reasonable legal practitioner would understand of it, I note the reservations expressed about the "target audience" test in Gatley, at [2.10], and in [2.12] note 19, opening words. The test is not easy to reconcile with the requirement of defamation law that "an imputation must tend to lower the defendant the claimant in the estimation of right‑thinking members of society generally" (Gatley, at [2.10], emphasis in the original). There is here no question of the statements being made in a form which would require a reader with special skills of some kind to understand them in the sense complained of, on which there is recognised authority: (see Gatley, at [2.13]).
I consider that on an application of the sort before me, I should not conclude the pleading of an imputation should be struck out because an ordinary reasonable person would, but an ordinary reasonable legal practitioner would not, see the publication conveying that imputation. Nor, in the final analysis, was it apparent to me that, in the pleaded circumstances of this case, the application of the target audience approach suggested would lead to a different result.
I now take the paragraphs of the proposed amended substituted statement of claim objected to separately.
Paragraph 3.2 is an imputation as to negligence and failing to register a transfer of land. Here it should be noted the Committee's letter, after reciting the complaint including this matter, referred to the fact that the Committee "considered that you were defacto acting for both parties, even if only on an informal basis, and it appeared that Ms Trevor was not advised that the transfer was not to be registered at the time of sale". This was preliminary to indicating the Committee's resolve "to further consider" the complaint once "investigation" of a previous complaint was completed.
I understood the substance of the objection of the defendants to this paragraph was that it was squarely within the principle associated with Mirror Newspapers Ltd v Harrison (1982) 149 CLR 293 as described by Newnes M in Chan No 1 at [38], a paragraph I quoted above. The defendants also reminded me that there was no reference, in the present context or elsewhere in the letter, to negligence.
However, I consider that there is more here than simply an indication that a complaint was received and was to be further considered. Whether or not an imputation of negligence would be plainly incapable of being conveyed where only those two aspects were referred to is something I return to in connection with par 3.4 below. In the case of the statement of the complaint to which par 3.2 relates, it is important to note additional matter represented by the quoted passage, in my view. With that, it appears to me that the imputation pleaded is not plainly incapable of being conveyed. I note for this purpose, as well the terms of the complaint as referred to in the letter, of a failure (to register a transfer), that it is referred to as made to a body whose name conveys a concern with complaints concerning lawyers. I further note that the imputation that there had been a failure to register the transfer, was an imputation that could readily be drawn from the reference to a failure to advise the client that the transfer was not to be registered at the time of sale. There was also the indication that the matter was one the Committee would "further consider". I also note the view referred to with approval in the judgment of Mason J in Mirror Newspapers (supra) at 303, that language suggesting a criminal charge was "well founded" would "carry the further imputation of guilt".
Paragraph 3.3 is the imputation as to negligence in failing to advise the named client that the plaintiff had failed to register a transfer of land. Here on the passage in the Committee's letter I have just quoted, and the considerations I have just rehearsed, I have come to the same conclusion as to par 3.2. If anything, the matter is, in light of the quoted passage, even clearer.
Paragraph 3.4 is the imputation as to negligence in failing to discharge an old mortgage and register a new one, apparently arising out of the same transaction as the transfer of land. Here there is no further language in the letter indicating the Committee's view of the matter, other than that it had "resolved to further consider" it (as part of the complaint that took in the other two matters, in pars 3.2 and 3.3, as pleaded). This it appears to me is directly within the principle in Mirror Newspapers, (supra), referred to by Newnes M at [38] in Chan No 1, above, unless there are grounds to distinguish this case.
One suggested ground pressed on me can be immediately put to one side, in my view. This ground rested on the point left open in Mirror Newspapers by Gibbs CJ (at 295) and Brennan J (at 304), and found by Mason J (at 301), that a statement that police had arrested and charged a person with an offence is capable of bearing the imputation that they have reasonable cause for doing so. It is in fact suggested in Gatley (supra) at [3.26] that the law has now reached the point foreshadowed by Mason J in Mirror Newspapers. This ground also rested on the suggestion in Gatley, at [3.26] note 64 that words like those were capable of bearing the imputation in a case like this one that the Committee suspected the applicant of negligence in the respect indicated.
The answer to this ground is that neither of the suggested imputations is in fact pleaded. Nor it seems to me is there any other language, like that for pars 3.2 and 3.3, to suggest that the Committee had such a suspicion or that they had a reasonable foundation which might carry "the further imputation of guilt" referred to by Mason J in Mirror Newspapers (supra) at 303.
It was further put to me that the imputation pleaded in par 3.4 is not plainly incapable of being born by the words of the letter as a whole, to which might be added what was in the later letter from the Committee as pleaded in par 5.4 of the minute of proposed amended statement of claim dated 1 December 2004. That letter, as pleaded, informed Ms Trevor that in effect the Committee had considered her complaints and had "not found the plaintiff guilty of any unprofessional conduct".
It is indeed the case that, in determining what imputation words are capable of bearing, they must be considered in their broader context: Gatley (supra) at [3.28]. The context here refers to the other language accompanying the words complained of and the time when, and the place where, the words were published: Gatley at [3.29].
Counsel for the applicant pressed on me that the context of note here is the listing of four complaints, three of which are to be investigated or further considered, and the other of which is not to be investigated because of the age of the matters concerned. The language of the complaints is that of failure to act or advise or misleading or deceiving a client, and there are, for some of the complaints or parts of them, some preliminary views expressed. These, it was said, were capable of colouring all of the references to the conduct complained of.
I disagree. The letter of the Committee of 25 February 1997 is a report to Mr Chan on the Committee's consideration of four complaints, each of which is separately treated. The language used to describe the complaints differs, as does the description of what (if anything) the Committee said about them. The action to be taken on them is not to be concurrent. These matters are as much a part of the context as those pressed on me by counsel for the applicant. Overall, I do not consider the rest of the letter has the effect contended for. I note of course that in this area it is "the broad impression conveyed by the libel" that "has to be considered" and "not the meaning of each word under analysis": Lewis v Daily Telegraph Ltd (1964) AC 234, per Lord Devlin at 285, quoted with approval by Brennan J in Mirror Newspapers (supra) at 304. However, so approaching the matter, as I have done, produces the conclusion I have referred to.
However, the reference to the second letter of the Committee appears to have been for the purposes of reminding me that the context also included the time and source of supply of the first letter. The time was "a date unknown between June and October 1997", and the source was the complainant, as pleaded. This would have tended to suggest enquiries were ongoing, when of course (as pleaded) they had been resolved. This in my view is the only possible relevance of the second letter for my purposes.
However, I do not consider this, either on its own or considered with the other language of the first letter, has the effect contended for following the approach in Lewis (supra). It seems to me that the timing and source aspects are of too ambiguous a character for the purpose contended. I presume that the purpose contended is to suggest that the Committee had not, despite the passage of at least four months, been able to conclude its investigation, which tended to confirm the applicant's guilt of negligence. The delay's implications in relation to the imputation pleaded appeared to me to lie in the realm of conjecture, "a strained or forced or utterly unreasonable interpretation" which the courts reject in this area of law: Jones v Skelton [1963] 1 WAR 1362, at 1370, PC; and Mirror Newspapers, (supra) per Mason J at 301, from which Newnes M quoted in Chan No 1, in the passage I set out above. I also note Gatley at [3.23].
Thus, I would not grant leave to amend in respect of par 3.4 of the Minute of the Proposed Amended Substituted Statement of Claim of 1 December 2004.

Applicable Pleading Principles: Imputations in 3.2 and 3.3 were Embarrassing

Counsel for the defendants submitted that these are repetitive or plead shades of the same meaning, as they go to the same form of pleaded misconduct (negligence) and to the same aspect (failure to register a transfer of land), of the same transaction. This would mean that the evidence required to justify each would not be "substantially different": see Newnes M in Chan No 1 at [39] and the authorities cited at the end of that paragraph. This would tend to "prejudice, embarrass or delay the fair trial of the action", the words of O 20 r 19(1)(c) on striking out pleadings as embarrassing.
I do not consider embarrassment would be produced by allowing a pleading of pars 3.2 and 3.3. There is indeed a common core to the foundation for the two imputations. There is, however, a distinctive difference between those imputations, going to the matter of what advice the applicant gave the complainant about the transfer in the transaction, as opposed to what the applicant did and did not do about that transfer. This would tend to require substantially different justificatory evidence in each case.
Accordingly I would not refuse leave on the embarrassment basis.

Result

I would thus grant the applicant leave to amend the statement of claim in terms of the Minute of Proposed Amended Substituted Statement of Claim dated 1 December 2004 and filed 9 August 2005, save as to par 3.4. I will hear from the parties as to the orders I should make including the order as to costs which should be fixed at the hearing in accordance with Practice Direction 5 of 2005.