Farah Custodians Pty Limited v Commissioner of Taxation (No 2)

Farah Custodians Pty Limited sought leave to amend its pleadings to include claims in negligence against the Commissioner of Taxation, which the Commissioner opposed. The court examined whether the Commissioner owed Farah a common law duty of care and if Farah could have suffered any loss or damage from the alleged breach of that duty. The Commissioner argued that Farah could not have suffered any loss upon which to base its claim in negligence, but the court found that Farah’s proposed negligence claim was reasonably arguable. The Commissioner also opposed the amendment on the basis that the negligence claim was not reasonably arguable, but the court found that Farah’s negligence claim, while novel, was at least reasonably arguable.

The court granted Farah leave to amend its pleadings, ordered the Commonwealth of Australia to be joined as the second respondent, and set out further steps for the case management. The court also ordered the parties to confer to reach agreement on further orders necessary to progress the matter, including any ongoing issues concerning discovery. This decision highlights the court's approach to interlocutory applications for leave to amend pleadings, particularly in complex cases involving novel claims in negligence against the Commissioner of Taxation.