Frith-Brown v Roberts Limited
[2019] TASSC 49
•20 December 2019
[2019] TASSC 49
COURT: SUPREME COURT OF TASMANIA
CITATION: Frith-Brown v Roberts Limited [2019] TASSC 49
PARTIES: FRITH-BROWN, Sanders Moen
FRITH-BROWN, Sanders Moen as executor
of the estate of the late Valerie Ruth James
v
ROBERTS LIMITED
FILE NO: 522/2013
JUDGMENT
APPEALED FROM: Roberts Ltd v Frith-Brown [2019] TASSC 29
DELIVERED ON: 20 December 2019
DELIVERED AT: Hobart
HEARING DATES: 5 – 6 December 2019
JUDGMENT OF: Wood J
CATCHWORDS:
Appeal and New Trial – Appeal – General principles – Interference with discretion of court below – Particular cases – Control over proceedings – Other cases – Where leave to amend statement of claim granted – Whether new cause of action or new case pleaded – Assertion of failure to consider specific and general prejudice – No error shown in exercise of discretion to allow amendment.
Supreme Court Civil Procedure Act 1932 (Tas), s 45(1).
Sale of Goods Act1896 (Tas) s 13(2).
Supreme Court Rules 2000 (Tas), r 427.
Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541; Ritchie & Parker Alfred Green & Co v Gornalle [2000] TASSC 8; Aon Risk Services Australia Limited v Australian National University [2009] HCA 27, 176 CLR 175; Prince Alfred College v ACD [2016] HCA 37, 258 CLR 134, referred to.
Aust Dig Appeal and New Trial [59]
REPRESENTATION:
Counsel:
Appellants: K Read SC and D Deller
Respondent: L Sealy SC and T Cox
Solicitors:
Appellants: Fitzgerald and Browne Lawyers
Respondent: Simmons Wolfhagen
Judgment Number: [2019] TASSC 49
Number of paragraphs: 142
Serial No 49/2019
File No 522/2013
SANDERS MOEN FRITH-BROWN, SANDERS MOEN FRITH-BROWN
as executor of the estate of the late VALERIE RUTH JAMES
v ROBERTS LIMITED
REASONS FOR JUDGMENT WOOD J
20 December 2019
1 This is an appeal from a decision of Holt AsJ delivered on 10 July 2019 granting Roberts Limited leave to amend its statement of claim. The proceedings concern the supply by Roberts Limited, the plaintiff and respondent in this appeal, of goods and services to Mr Sanders Moen Frith-Brown and Dr Valerie Ruth James and a debt arising. They are the original defendants to the proceedings before Holt AsJ, noting that the proceedings were amended after the death of Dr Valerie James in 2014.
2 It is uncontroversial that between 2003 and 2008 Mr Sanders Frith-Brown and Dr Valerie James operated a farm at Toom's Lake Road, Ross known as "Mount Morriston" and between 2005 and 2008 Mr Frith-Brown operated a farm at Ellendale Road, Ouse known as Norley. Roberts supplied rural goods and services to both farms on credit. It was alleged in the statement of claim dated 20 February 2014 that Roberts had a credit contract with Dr James for the supply of goods and services with respect to the farm at Ross, and a credit contract with Mr Frith-Brown for the supply of goods and services for the farm at Ouse. By April 2008, the debit balance on the accounts was $830,745.96. It was alleged that on 2 April 2008, the defendants agreed with Roberts that they would pay the accounts less a $200,000 credit to be provided by Roberts. There was a subsequent agreement made 7 April 2008 that the starting amount payable be increased from $830,745.96 to $832,226.07. It is further alleged by the plaintiff that the defendants have not paid anything off the debit balance of the accounts.
The history of the pleadings
3 The court proceedings commenced over 10 years ago.
4 In August 2008, Roberts issued two writs against Mr Sanders Frith-Brown and Dr Valerie James individually as defendants and discontinued the action approximately a year later. Those writs were replaced in 2009 with a single action against both defendants. The endorsement of claim described the claim as $630,745.96 for the balance of monies due under an agreement dated 2 April 2008 wherein the defendants agreed to pay that amount in settlement of credit facilities. A statement of claim was filed.
5 Another action issued in June 2013 against both defendants, claiming $830,745.96 in debt, or in the alternative $630,745.96, and in the alternative, accounts stated in those sums and further, in the alternative, damages arising from agreements involving credit arrangements.
6 A statement of claim dated 20 February 2014 was filed. On 11 March 2014, the court ordered by consent that the proceedings be consolidated and that the February 2014 statement of claim be treated as the statement of claim in the consolidated proceeding. This statement of claim was ultimately the subject of the order under appeal in July this year granting Roberts leave to amend.
7 Since February 2014, the statement of claim has been amended a number of times. In April 2019, the court, by consent, made an order deleting specific paragraphs. Counsel are agreed that I should regard the amended version of the statement of claim, as it stood at that time, as the current or extant version at the time of the proceedings before the Associate Judge. Unfortunately, the version for consideration may not have been identified with clarity before the Associate Judge and it seems his Honour may have overlooked the most recent amendments to the statement of claim. The version of the statement of claim set out by his Honour in his reasons is not the extant version and significant parts redacted by formal amendment in April 2019 are not reflected in that version.. While it is not suggested by counsel that that had particular significance for his Honour's decision or the disposition of this appeal, it will be seen from my reasons that it may have had significance in at least one respect.
The extant statement of claim
8 The key parts of the statement of claim before Holt AsJ in its form at the time of the proceedings before his Honour are as follows:
"1 The plaintiff ('Roberts') is, and was at all material times, a company registered pursuant to the provisions of the Corporations Act 2001 (Cth) and capable of suing in its own name.
2 Since in or about 2005, the firstnamed defendant ('Frith-Brown') was the registered proprietor of a property situate at Ellendale Road, Ouse in Tasmania and known as 'Norley' from which he operated a farming business.
3 At all material times:
(a) the secondnamed defendant ('James') has been the registered proprietor of a property situate at Tooms Lake Road, Ross in Tasmania and known as 'Mount Morriston'; and
(b) Firth-Brown and James operated a farming business at Mount Morriston.
4 From 2003 to in or about October 2007, Ray Peters acted as the agent of the defendants and had ostensible authority to purchase goods and services on credit from Roberts on the defendants' behalf in relation to the farming businesses operated from Mount Morriston and Norley, arising out of:
(a) ...
(b) ...
(c) ...
(d) ...
(e) ...
5 From in or about October 2007 to in or about August 2008, Peter Cush acted as the agent of the defendants and had ostensible authority to purchase goods and services on credit from Roberts on the defendants' behalf in relation to the farming businesses operated from Mount Morriston and Norley, arising out of:
(a) ...
(b) ...
(c) ...
(d) ...
6 In or about March 2003, Frith-Brown and James entered into a contract for the purposes of facilitating the purchase of goods and services on credit from Roberts, for which they would be jointly and severally liable (the 'First Credit Contract'), which was partly written and partly to be implied.
PARTICULARS OF THE FRIST CREDIT CONTRACT
....
9 On or about 1 November 2005, Firth-Brown entered into a further contract with Roberts, which was partly written and partly to be implied by the actions of Roberts
and which contained, amongst others, all the terms referred to in paragraph 7(a), save that those terms only relate to Frith-Brown, and provide an interest rate of 16.05% as the interest rate for the equivalent of the term referred to in paragraph 7(a)(ii)(the 'Second Credit Contract').
PARTICULARS OF THE SECOND CREDIT CONTRACT
...
12 For the purposes of facilitating the First Credit Contract and the Second Credit Contract, Roberts opened various internal accounts (the 'Initial Accounts') on its electronic systems in the names of Frith-Brown and James, being:
(a) ...
(b) ...
(c) ...
13 Between March 2003 and August 2008, inclusive, pursuant to the terms of the First Credit Contract and the Second Credit Contract, Roberts performed services on behalf of, and supplied goods to, Frith-Brown and James at the request, variously, of:
(a) Frith-Brown;
(b) James;
(c) Ray Peters; and
(d) Peter Cush
For which amounts in respect of each service performed and good [sic] supplied were recorded to the Initial Accounts and Frith-Brown and James were invoiced some of which invoices were paid.
PARTICULARS OF INVOICES
...
PARTICULARS OF GOODS AND SERVICES
The goods and services, and the amounts recorded in respect of them, are listed on invoices which were supplied to Frith-Brown and James between March 2003 and August 2008, inclusive, copies of which are available for inspection at the offices of Roberts' legal practitioners by prior arrangement.
14 By an agreement made on or about 9 November 2007 between Roberts and Frith-Brown at Norley (the 'November Agreement') Roberts and Frith-Brown agreed that:
(a) ...
(b) ...
(c) in relation to the Initial Accounts, the outstanding balances of which as at 31 October 2007 collectively amounted to $959,635.00, a new 'Norley irrigation' account would be established and all transactions for Norley irrigation works which had previously been recorded on the account opened in Frith-Brown's name pursuant to the Second Credit Contract would be transferred to the new irrigation account, and all interest previously charged on invoices issued for that amount would be credited accordingly;
...
PARTICULARS OF THE NOVEMBER AGREEMENT
...
15 Between 12 November 2007 and 9 January 2008, pursuant to the November Agreement, Roberts:
(a) undertook and completed the works required by the terms of the November Agreement;(b) moved $350,589.23 then owing to the 'Sanders Frith-Brown MERCH A/c, No 537842' account, in respect of the Norley irrigation works referred to in paragraph 14, to a separate non-interest-bearing account, being 'Sanders Frith-Brown FERT A/C, No 554997' (the 'New Account') as required by the term of the November Agreement pleaded at paragraph 14(c) and which Roberts had created for that purpose; and
(c) provided an interest-credit on the Initial Accounts, in respect of the transactions which formed the subject of the November Agreement, of $20,157.62.
16 Subsequent to the November Agreement, and pursuant to the First Credit Contract and/or the Second Credit Contract Frith-Brown and James continued to purchase goods and services on credit from Roberts, and Roberts :
(a) deducted sums on Frith-Brown and James' behalves, from the Initial Accounts and the New Account (jointly, the 'Accounts'); and
(b) continued to invoice Frith-Brown and James in respect of the Accounts.
PARTICULARS OF ADDITIONAL ITEMS AND DEDUCTIONS
The additional items and deductions are particularised in the document attached to this statement of claim and marked 'A'.
17 As at 2 April 2008, the amounts debited to the Accounts comprised $830,745.96, distributed as follows:
(a) Valerie R James – MERCH ONLY, No 533605, $339,387.42;
(b) Sanders Frith-Brown – MERCH A/C, No 537842, $140,287.56;
(c) Sanders Frith-Brown – MERCH A/C, No 538992, $481.75; and
(d) Sanders Frith-Brown – FERT A/C, No 554997, $350,589.23.
PARTICULARS OF $830,745.96 BALANCE
...
18 On or about 2 April 2008, Roberts, Frith-Brown and James entered into an agreement (the 'April Agreement').
PARTICULARS OF APRIL AGREEMENT
The April Agreement was hand-written, dated 2 April 2008 and signed by Frith-Brown and James, and Tony Roberts and Colin Bell on behalf of Roberts and a copy of the April Agreement is available for inspection at the offices of Roberts' legal practitioners by prior appointment.
19 There were express terms of the April Agreement, amongst others, to the following effect:
(a) Frith-Brown and James would pay the balance of the Accounts, as they would stand after the $200,000.00 credit referred to in paragraph 19(c), on or before 9 April 2008;
(b) Roberts would move the Mount Morriston pivot, which comprised part of irrigation works which Roberts had previously carried out at Mount Morriston, to a site which had been agreed at Norley;
(c) Roberts would pay into, or credit to, those of the Accounts which related to the property known as 'Norley', the sum of $200,000.00;
(d) Robert would undertake the filling of two irrigation channels, and supply a contractor to work on another irrigation channel for a period of five days, at Norley;
(e) Roberts would use 'filled-in channel bridges' for any pivot crossings required at Norley; and
(f) Roberts would provide labour to check that any water winch travellers bought from Roberts were operating and provide up to $10,000.00 of parts to make the same work, if they were inoperative.
20 By subsequent agreement between Frith-Brown and James and Roberts made on or about 7 April 2008 (the 'Second April Agreement') either:
(a) the parties entered into a further agreement; or
(b) in the alternative, the April Agreement was varied, which agreement either had express terms, or varied the April Agreement's express terms, to the effect that:
(c) as to the terms listed at paragraphs 19(a) and 19(c), Frith-Brown and James were to pay $632,226.07 (being $832,226.07 less $200,000.00) on or before 11 April 2008,
and on receipt of that money Roberts would credit the Norley account with the sum of $200,000.00;(d) as to the term listed at paragraph 19(b), Roberts was to move, at its cost, a five span centre pivot nominated by Frith-Brown and James from Mount Morriston to Norley and install the pivot on or before 30 June 2008;
(e) as to the term listed at paragraph 19(d), Roberts would fill with soil, at its cost, the lower of the two new irrigation channels and supply a contractor for five working days to work on the upper channel as required, under the direction of Frith-Brown and James;
(f) as to the term listed at paragraph 19(e), any channel bridges removed from the lower channel would be used on the centre pivot installation as required; and
(g) as to the term listed at paragraph 19(f), Roberts would provide all labour required to check all water winch travellers bought ex-hire from Roberts (approximately 24) to ensure they were operational by 30 June 2008 and would provide parts to repair those travellers if required, up to a maximum value of $10,000.00.
21 Frith-Brown and James did not pay to Roberts:
(a) $632,226.07; or
(b) in the alternative, $832,226.07;
and have not paid any of those sums, nor any part of those sums, to Roberts.
22 In the premises, Frith-Brown and James have breached, and continue to breach, the:
(a) terms of the First Credit Contract pleaded at paragraph 7(a)(i);
(b) terms of the November Agreement pleaded at paragraph 14(d) and 14(e);(c) term of the April Agreement pleaded at paragraph 19(a);
(d) term of the Second April Agreement pleaded at paragraph 20(c); and
(e) the April Agreement, as varied by the Second April Agreement, in the alternative to paragraph 22(d),
and Frith-Brown has breached the term of the Second Credit Contract identical to that pleaded in the First Credit Contract at paragraph 7(a)(i).23 In the premises:
(a) Frith-Brown and James are jointly and severally indebted to Roberts:
(i) in respect of the First Credit Contract, in the sum of $339,387.42 together with interest on that sum as set out on the table attached and marked 'C'; or(ii)
further, or in the alternative, in respect of the April Agreement and the Second April Agreement, in the sum of:A $832,226.07; or
B in the alternative, $632,226.07,
(b) Frith-Brown is indebted to Roberts:
(iii) in respect of the Second Credit Contract in the sum of $491,358.54, together with interest on that sum as set out on the table attached and marked 'D'; or
(iv) further, or in the alternative, in respect of the NovemberAgreement, in the sum of$588,888.15,
and interest continues to accrue on the First Credit Contract and the Second Credit Contract at the rates listed in the tables marked 'C' and 'D', respectively, in accordance with the clause of the First Credit Contract pleaded at 7(a)(ii), and the term of the Second Credit Contract which is identical to that pleaded at paragraph 7(a)(ii), save that it referred to Frith-Brown alone and specified an interest rate of 16.05%.24
Further, or in the alternative, in the premises Roberts claims from Frith-Brown and James the balance of $632,226.07 due from the accounts stated between them in the Second April Agreement....
AND ROBERTS CLAIMS AGAINST FRITH-BROWN AND JAMES
A $832,226.07;
B in the alternative to A, $632,226.07;
C further to B, $339,387.42
D interest on the sum listed in C in accordance with the table referred to in paragraph 23;
E damages; andF costs to be taxed,
AND AS AGAINST FRITH-BROWN
G in the alternative to B, $588,888.15;
H $491,358.54;
I damages;
J costs to be taxed; and
K interest on the sum listed in H in accordance with the table referred to in paragraph 23."
The proposed amendments
9 The proposed statement of claim (dated 22 May 2019) is set out in the reasons of the Associate Judge and is as follows:
"1 The Plaintiff ('Roberts') is and was at all material times a corporation registered pursuant to the provisions of the Corporations Act 2001 (Cth) and carrying on the business of (inter alia) a supplier of irrigation and rural merchandise and related services.
2 At all material times since in or about 2005, the firstnamed defendant ('Frith-Brown') operated a farming business on and from a property situated at Ellendale Road, Ouse in Tasmania and commonly known as 'Norley'.
3 At all material times since in or about 2003, Valerie Ruth James ('James') and Frith-Brown operated a farming business on and from a property situated at Toom's Lake Road, Ross in Tasmania and commonly known as 'Mount Morriston'.
4 On divers dates between 7 June 2007 and on or before 31 January 2008 Roberts at the request of Frith-Brown sold and delivered rural merchandise and supplied various related services to Frith-Brown at Norley upon credit.
Particulars
Particulars of the said merchandise and services exceed three folios and have previously been provided to the defendants.
5 On divers dates between 7 June 2007 and on or before 3 March 2008 Roberts at the request of James sold and delivered rural merchandise to James at Mount Morriston upon credit.
Particulars
Particulars of the said merchandise exceed three folios and have previously been provided to the defendants.
6 It was a term implied by law of the agreements pursuant to which the rural merchandise and services were delivered and supplied to Frith-Brown and James as alleged in paragraphs 4 and 5 hereof that Frith-Brown and James would each pay the reasonable value thereof.
7 The aforesaid dealings between the plaintiff and Frith-Brown and James resulted in debts, claims and demands by the plaintiff of the one part and by the Frith-Brown and James of the other part each against the other.
Particulars of Debts, Claims and Demands
(a) Roberts claimed $830,745.96 as debts due and owing by Frith-Brown and James;
(b) Frith-Brown claimed that within the period November 2006 to March 2008 Roberts had purported to charge Frith-Brown for goods sold and delivered and services supplied which Frith-Brown claimed Roberts had not, in fact, sold and delivered or supplied for his benefit;
(c) Frith-Brown further claimed that Roberts had failed to carry out services in a workman like manner; and
(d) James claimed that within the period February 2003 to April 2008 Roberts had purported to charge James for goods sold and delivered and services supplied which James claimed Roberts had not, in fact, sold and delivered or supplied for her benefit.
8 On or about 2 April 2008 an account was stated between Roberts of the one part and Frith-Brown and James of the other part, in respect of the said debts claims and demands and the balance of the said account, namely $630,745.96 was then agreed between the parties to be jointly and severally due from Frith-Brown and James to Roberts and payable on or before 9 April 2008.
Particulars of Account Stated
The said account was stated and agreed and evidenced in writing and signed by each of Frith-Brown and James at the conclusion of a meeting which took place on 2 April 2008 at Mount Morriston in Tasmania between Mr Tony Roberts and Mr Colin Bell as servants or agents of Roberts and Frith-Brown and James.
9 Frith-Brown, James and the secondnamed defendant have and each of them has failed or refused and continue to fail or refuse to pay the said sum of $630,745.96 or any part thereof.
10 In the alternative, Roberts refers to and repeats paragraph 4 hereof and says that Frith-Brown is truly indebted to Roberts in the sum of $488,330.46 being the outstanding balance of the reasonable value of the merchandise and services supplied as aforesaid which sum has been due and payable by Frith-Brown since not later than 2 April 2008.
11 Further, Roberts refers to and repeats paragraph 5 hereof and says that James is truly indebted to Roberts in the sum of $298,131.28 being the outstanding balance of the reasonable value of the merchandise supplied as aforesaid which sum has been due and payable by James since not later than 2 April 2008.
12 Frith-Brown has failed or refused and continues to fail and refuse to pay the sum of $488,330.46 or any part thereof.
13 James and the secondnamed defendant have failed or refused and continue to fail and refuse to pay the sum of $298,131.28 or any part thereof.
AND the Plaintiff claims
The sum of $630,745.96 as money due on an account stated.
Alternatively, the sum of $488,330.46 against Frith-Brown, the sum of $298,131.28 against the secondnamed defendant."
The decision of Holt AsJ
10 The defendants opposed the making of the order granting leave to amend the statement of claim on the grounds summarised by Holt AsJ as follows:
"(1) A cause of action is not disclosed.
(2) There is a lack of clarity.
(3) Allowing the amendment would be prejudicial to the defendants.
(4) Allowing the amendment would be to permit an abuse of process."
11 His Honour considered the submissions and reached the following conclusions:
"[70] The proposed pleading reintroduces a previously abandoned claim in debt for an account stated on 2 April 2008. I have found that a fair trial can still occur on this claim. Further, the proposed pleading now properly characterises the claim for payment for the supply of services and goods. The allegations in respect of the latter claim have been refined and I have concluded that such refinement, if allowed, will not diminish the chances of a fair trial.
[71] I have not accepted the defendants' argument presented to date that the proposed plea fails to disclose causes of action or lacks clarity to the extent that allowing it would tend to prejudice or delay the fair trial of the proceedings.
[72] I do not consider that refusing leave to amend on the grounds of oppression or abuse of process is necessary or desirable. An application for dismissal or a permanent stay is pending and it will be heard and determined in due course.
[73] In considering whether to grant leave I take into account case management principles directed to efficiency including the use of court time, but noting that this proceeding has never reached a stage where it is anywhere near ready for trial.
[74] Rule 427(1) calls for a discretionary judgment and the onus is on the plaintiff. I have been positively persuaded that the justice of the case lies with granting leave to make the amendment sought."
12 His Honour gave leave to amend the statement of claim by substituting an earlier proposed version with the proposed statement of claim dated 22 May 2019. He gave the defendants liberty to apply to strike out the statement of claim to address possible problems that his Honour had raised in his reasons regarding the statement of claim.
The appeal and issues arising
13 The appellants have appealed the decision of the Associate Judge on the following grounds:
"1 Erred in that he failed to find for the purposes of r 427(2A) in respect of the proposed causes of action under the Sale of Goods Act 1896 that the relevant limitation period had expired after the day on which the proceedings had commenced. He failed to find in respect to the proposed causes of action under the Sale of Goods Act 1896 that r 427(2A) applied to those causes of action.
2 Erred in that he failed to find for the purposes of r 427(2A) in respect of the proposed causes of action in indebitatus assumpsit for provision of services that the relevant limitation period had expired after the day on which the proceedings had commenced. He failed to find in respect to the proposed causes of action for provision of services that r 427(2A) applied to those causes of action.
3 Erred in characterising the proposed causes of action for provision of services as actions in indebitatus assumpsit when they are claims in quantum meruit where the relevant limitation period had expired after the day on which the proceedings had commenced. As such his Honour had to consider these claims under r 427(2A).
4 Erred in his determination under r 427(2A) that the defendants would not as a result of the grant of leave be prejudiced in the conduct of their defence in a way that could not be fairly met by an adjournment, an award of costs or otherwise.
5 Erred in granting leave to the plaintiff under r 427(1) to substitute the proposed Statement of Claim dated 22 May 2019 in the exercise of that discretion he failed to take into account:
a factors of oppression and the abuse of process [68,69];
b the letter dated 2 April 2008 and its potential discordance with the plea at para 8 of the proposed Statement of Claim [34];
c the fact that there were possible omissions in the proposed Statement of Claim [24,25,26];
d the fact that the proposed Statement of Claim did not contain the necessary plea that a price had not been agreed;
e case management principles;
f the fact that the proposed Statement of Claim comprised causes of actions which were statute barred;
g the fact that the plaintiff was attempting to introduce a cause of action in quantum meruit, which cause of action was statute barred;
h the fact that all causes of actions in the proposed Statement of Claim were pleaded on the basis of 'multiple agreements';
i that the proposed Statement of Claim was embarrassing."
14 In order to succeed on this appeal, the appellants have to show that the Associate Judge made an error: Supreme Court Civil Procedure Act 1932, s 45(1).
15 The first two grounds are somewhat ambiguous and suggest that his Honour overlooked making a finding about the relevant limitation period and when it expired. Rather, it is plain from the argument that there is no issue about when the limitation period had expired and the alleged error is that his Honour should have found, in relation to the proposed amendments, that they amounted to new claims or causes of action and that therefore r 427(2A) had application. Additionally it is contended that his Honour erred by characterising the proposed causes of action for provision of services as actions in indebitatus assumpsit when they are claims in quantum meruit.
16 There are a number of issues that arise under the first three grounds:
• The effect and operation of r 427(2A).
• The nature of the proposed amendments and whether they introduced a new cause of action, or if they had been brought as new proceedings, would have been statute barred.
• The elements of the causes of action pleaded in the proposed amended statement of claim and whether the essential facts with respect to those elements were pleaded in the current version of the statement of claim.
• The correct characterisation of the cause of action for provision of services.
17 It is convenient to consider the effect and operation of r 427(2A) as a preliminary issue before consideration of each of the grounds of appeal.
The effect of r 427(2A)
18 The relevant rule is r 427 in the Supreme Court Rules 2000. The relevant parts of the rule are as follows:
"427 Amendment of endorsement or pleadings
(1) At any time before judgment, the Court or a judge may grant leave to a party to amend any process or pleading in such a manner and on such terms as may be just.
(2) Subject to subrule (3) , the pleadings may be amended as necessary for the purpose of determining the real questions in controversy between the parties.
(2A) The Court or judge, despite the expiry of any relevant limitation period after the day on which proceedings commenced, may grant leave under subrule (1) if it is satisfied that any other party to the proceedings would not, as a result of granting leave, be prejudiced in the conduct of his or her claim or defence in a way that could not be fairly met by an adjournment, an award of costs or otherwise."
19 It is uncontroversial, as noted by the learned Associate Judge at [11] of his reasons for judgment, that: "Sub-rule (2A) was introduced to ameliorate the rigidity inherent in the rule of practice referred to in Weldon v Neal (1887) 19 QBD 394. That rule being that new claims could not be introduced by amendment after the expiry of a limitation period except, perhaps, in very peculiar circumstances."
20 The learned Associate Judge made other observations about how the first three sub-rules operate:
"[6] The distinction between subrr (1) and (2) of r 427 is that subr (2) only applies to amendments which are necessary for the purpose of determining the real questions in controversy. It does not apply to other types of amendment including amendments designed to set up a new case.
[7] Although, necessary amendments, like other amendments, are now discretionary the fact that the two kinds of amendment are dealt with in separate subrules indicates that different considerations apply.
[8] The subr (2) type discretion was considered in Commonwealth v Verwayen [1990] HCA 39; (1990) 170 CLR 394, where Dawson J said at 456:
'The rules of court have always provided that leave to amend pleadings may be given for the purpose of determining the real question in controversy between the parties ... and an amendment should ordinarily be allowed if any harm arising from so doing can be compensated for by the imposition of terms upon the party asking for the amendment: ...'
[9] There is no modern practice that amendments which are not necessary for the purpose of determining the real questions in controversy will generally be allowed. In Aon, Gummow, Hayne, Crennan, Kiefel and Bell JJ said at [111]–[112]:
'An application for leave to amend a pleading should not be approached on the basis that a party is entitled to raise an arguable claim, subject to payment of costs by way of compensation. There is no such entitlement. All matters relevant to the exercise of the power to permit amendment should be weighed. The fact of substantial delay and wasted costs, the concerns of case management, will assume importance on an application for leave to amend. Statements in J L Holdings which suggest only a limited application for case management do not rest upon a principle which has been carefully worked out in a significant succession of cases. On the contrary, the statements are not consonant with this Court's earlier recognition of the effects of delay, not only upon the parties to the proceedings in question, but upon the court and other litigants. Such statements should not be applied in the future.
A party has the right to bring proceedings. Parties have choices as to what claims are to be made and how they are to be framed. But limits will be placed upon their ability to effect changes to their pleadings, particularly if litigation is advanced. ...'
[10] Further, where an amendment seeks to introduce a new claim after a limitation period has expired, r 427(2A) mandates that the discretion to permit the amendment is not enlivened unless the Court or judge '... is satisfied that any other party to the proceedings would not, as a result of granting leave, be prejudiced in the conduct of his or her claim or defence in a way that could not be fairly met by an adjournment, an award of costs or otherwise'.
[11] …
[12] As subr (2A) is concerned with the bringing of claims after a limitation period has expired, the cases regarding the discretion to extend time under limitation legislation provide guidance as to the interpretation to be given to the rule. Upon an application for an extension of time a significant factor in the consideration is the issue of whether the delay would cost the defendant a fair trial. Hill v IlukaCorporation Ltd [2002] TASSC 113. As to the meaning of prejudice in a limitation of actions context 'the real question is whether the delay has made the chances of a fair trial unlikely'. Brisbane South Regional Health Authority v Taylor [1996] HCA 25; (1996) 186 CLR 541 at 550. The rule is remedial and so should be given a beneficial interpretation. I interpret the reference in the rule to prejudice in the conduct of the claim or defence to be a reference to material prejudice in the sense that by reason of the delay the chances of a fair trial have become unlikely."
21 The contentions of the parties do not suggest that the learned Associate Judge erred in his construction of the relevant aspects of r 427(2A). Counsel's submissions in their short-hand form referred to a "new cause of action" as required by or contemplated by r 427(2A). It must be remembered that r 427(2A) does not expressly refer to a "new cause of action", and the sub-rule does not expressly limit its application to amendments that have that effect. Indeed, taken in isolation, the words of subr (2A) could be interpreted to cover any amendment "despite the expiry of the limitation period". An interpretation of subr (2A) that it applies to amendments that introduce a new cause of action takes account of considerations beyond the text of subr (2A) such as the structure of the rule generally, the factors adverted to by the Associate Judge and the historical context of the amendments to the rule in its present form.
22 Other than noting that the trigger for the application of subr (2A) of a "new cause of action" is not expressly set out in subr (2A), the interpretation of subr (2A) is not contentious. It is common ground that an amendment that introduced a new cause of action would invoke the stringent requirements in subr (2A) and that otherwise, the more general discretion in subr (1) would apply.
23 At the hearing and on appeal, the appellants contended that the claims in the proposed statement of claim were "new" claims or causes of action, which triggered r 427(2A), and they would be prejudiced in the conduct of their defence in a way that could not "fairly be met by an adjournment, an award of costs or otherwise".
24 Having regard to the fact, as noted by the Associate Judge, that subr (2A) is concerned with the bringing of claims after a limitation period has expired, the cases regarding the discretion to extend time under limitation legislation provide guidance as to the interpretation of the rule. Clearly, we are concerned with amendments that pre subr (2A) would have been regarded as offending the rule in Weldon v Neal as introducing a "new cause of action in a technical sense".
25 In Ritchie & Parker Alfred Green & Co v Gornalle [2000] TASSC 8, the scope of the rule in Weldon v Neal was considered and Cox CJ at [3] identified two propositions as reflecting the approach of the courts in applying the rule: "an amendment will normally be refused if it introduces a new cause of action in a technical sense, or if, though not doing so, it introduces such significantly different facts that the defendant for reasons other than the loss of a right to plead the relevant Limitation Act would be prejudiced by the amendment". See also, Wright J at [12]. As for the second proposition involving a "new case", Wright J referred to a "fresh set of facts or ideas, or involves a fundamental departure from the existing claim."
26 For the purpose of considering the appellants' argument I will proceed on the basis that subr (2A) is not confined to amendments which seek to set up a new cause of action which would be statute barred, but also amendments that fall within the second proposition in Ritchie & Parker. I note that this approach seems to coincide with the view taken by Holt AsJ. The Associate Judge discussed Weldon v Neal and noted the authority of Ritchie & Parker:
"[53] The rule was introduced in 2003 to ameliorate the rigidity inherent in the practice known as the rule in Weldon v Neal (1887) 19 QBD 394 by which proposed pleading amendments introducing new causes of action outside prescribed limitation periods were, except perhaps in very peculiar circumstances, to be disallowed. For the purpose of the rule in Weldon v Neal, new causes of action were regarded as being introduced where a new cause arose in the technical sense. The rule might also apply where, although the legal characterisation of the cause of action remains the same, the proposed new pleading seeks to introduce a fresh set of facts or ideas involving a fundamental departure from the existing claim. See Ritchie & Parker Alfred Green & Co v Gornalle [2000] TASSC 8. An assessment of whether a new cause of action in the technical sense is being introduced does not involve ascertainment of what the pleader had in mind at the time. What matters is not the intention of the pleader, but whether the facts alleged, if substantiated, would afford an opportunity for the relief claimed to be granted. See Agtrack (NT) Pty Ltd v Hatfield [2005] HCA 38; (2005) 223 CLR 251 and Air Link Pty Ltd v Paterson [2005] HCA 39; (2005) 223 CLR 283."
27 As submitted by the respondent, r 227 does not require that names of causes of action be expressly stated in the pleadings identifying a claim under the Sale of Goods Act 1896 (Tas) or a claim in indebitatus assumpsit or a claim in negligence. What is required is that material facts be pleaded giving rise to the causes of action relied upon. The failure to use the legal expressions does not mean that the pleading is bad.
Ground 1 – a new cause of action for goods
28 Ground 1 concerns the claim in respect of goods. The proposed statement of claim includes claims in respect of "rural merchandise" alleged to have been sold and delivered by the plaintiff pursuant to unspecified "agreements" per pars 4 – 6 of the statement of claim. These claims are governed by the Sale of Goods Act.
29 As for whether the proposed amendments disclosed a cause of action, his Honour considered whether the material facts had been pleaded with respect to the claims for the supply of services and goods, and the claim for account stated.
30 In relation to the claim for the supply of goods, his Honour referred to the Sale of Goods Act, s 13(2) which provides that "where the price is not determined the buyer must pay a reasonable price. What is a reasonable price is a question of fact dependent on the circumstances of each particular case."
31 His Honour analysed the essential elements of a complete cause of action in the case of supply of goods as well as services at [23]:
"[23] It follows from the general law (in the case of the supply of services) and from the Act (in the case of the supply of goods) that where price has been left indeterminate and an action is to be brought for payment that the essential elements are firstly request (in the case of goods), secondly supply, thirdly acceptance (in the case of services) and fourthly demand (in the case of services). In my view, these elements, with the exception of acceptance, are sufficiently encompassed in the proposed statement of claim at pars 4, 5, 7, 10, 11, 12 and 13 so as to formulate complete causes of action in debt and under the Act."
32 His Honour made some obiter remarks about other "potential problems" with the proposed statement of claim:
"[25] There may also be a problem arising from the failure to plead that payment for goods was due on a date certain. The Sale of Goods Act, s 53, provides:
'53 Action for price
(1) Where under a contract of sale the property in the goods has passed to the buyer, and the buyer wrongfully neglects or refuses to pay for the goods according to the terms of the contract, the seller may maintain an action against him for the price of the goods.
(2) Where under a contract of sale the price is payable on a day certain irrespective of delivery, and the buyer wrongfully neglects or refuses to pay such price, the seller may maintain an action for the price, although the property in the goods has not passed, and the goods have not been appropriated to the contract.'
[26] Another potential problem is that the proposed statement of claim contains no plea to connect the persons ordering the services and goods with Frith-Brown and James in the event that the services and goods were ordered by farm managers (as alleged in the existing statement of claim) rather than Frith-Brown and James directly (as appears to be the claim in the proposed new plea)."
33 His Honour went on to note at [27]:
"[27] These possible omissions were not the subject of argument before me. It is accordingly inappropriate that I should deal with them now. If leave to amend is granted and the proposed statement of claim filed and delivered I shall reserve leave to the defendants to apply to have the statement of claim, insofar as it concerns the supply of services and goods, struck out."
34 His Honour held that the balance of the proposed claim, namely the claims for the value of services and goods supplied, was in the existing statement of claim:
"[51] The proposed new statement of claim proceeds on the proper legal bases for these claims, whereas the 2014 pleading was lengthy and confusing. Much of the confusion arose from the fact that the 2014 pleading of these claims was based in the law of contract rather than formulated as an action based in indebitatus assumpsit and under the provisions of the Sale of Goods Act.
[52] The fact that the legal characterisation of the claim has altered and that the allegations of fact have been reformulated does not necessarily mean that the claim for the value of the services and goods supplied is a new claim attracting the operation of r 427(2A).
…
[54] The existing statement of claim, although clearly designed to formulate a claim based in contract for the recovery of the value of services and goods supplied, does not, in my opinion, by reformulation based on indebitatus assumpsit and the Sale of Goods Act create a new causes of action in the technical sense. The essence of the claim remaining as a claim for the value of services and goods supplied.
[55] The result is that the proposed reintroduction of the 2 April 2008 debt claim based on an account stated attaches the operation of r 427(2A), but the proposed plea claiming the value of services and goods supplied does not."
35 It is submitted on appeal that the conclusion of the Associate Judge that the claims in the proposed statement of claim based on the Sale of Goods Act did not create a new cause of action was erroneous for the following reasons:
• The proper characterisation of the February 2014 statement of claim in relation to "goods" supplied by the plaintiff is that they are common law contract claims for debt arising under or damages for breach of the First Credit Contract and/or the Second Credit Contract, and not a claim for the value of goods supplied: pars 22 and 23 of the original statement of claim.
• The contracts pleaded in the current statement of claim are different to the "agreements" pleaded in the proposed amendments.
• The terms of the contracts in the current statement of claim are different to the terms of the "agreements" pleaded in par 6 of the proposed amendments. The current statement of claim pleads that the goods were supplied pursuant to the terms of the credit contracts and that there were express and implied terms that the plaintiff was entitled to invoice the defendants (see pars 6 – 10 of the statement of claim). By contrast, the proposed amended statement of claim pleads that it was a "term implied by law of the agreements" pursuant to which the goods were delivered that the defendant Mr Frith-Brown would pay the reasonable value thereof (see par 6 of the proposed statement of claim).
• The proper characterisation of the claims in relation to "goods" or "rural merchandise" supplied by the plaintiff in the proposed statement of claim is that those claims are claims for payment of a reasonable price for the goods pursuant to s 13 of the Sale of Goods Act. Accordingly the claims in the proposed amended statement of claim have a different legal characterisation and set up a new cause of action and the essence of the claim is different.
• The facts pleaded in the current statement of claim were deficient and would not have sustained a cause of action under s 13 of the Sale of Goods Act because there was no plea:
a That the price of goods was not fixed by the contract of sale, left to be fixed in manner agreed or determined by the course of dealing between the parties;
b That the defendants, as the buyers, must pay a reasonable price as required by s13 of the Sale of Goods Act;
or
c As to the reasonable price of the goods which the defendants, as the buyers must pay.
36 There was a further submission that counsel for the plaintiff during an interlocutory hearing on 3 April 2019 abandoned all claims pleaded in the statement of claim, other than the claim for an account stated on 7 April 2008. The appellants did not rely upon this argument at the hearing of the appeal. I do not need to consider it; at most counsel made an ambiguous concession which could not be regarded as binding. There was no assertion by the appellants of estoppel.
37 The respondent's submission was that no new "cause of action" was sought to be pleaded. It was highlighted that the endorsement of the writ maintained a claim for "debt" for the provision of goods and the supply of services. This was the essence of the claim in the amendment. It was also highlighted that a claim for a debt (ie, money due) is a liquidated claim, but that is not to say that the amount claimed in the writ or statement of claim must be the same amount ultimately found by a court to be due and owing.
38 It was submitted that the statement of claim in its current form claimed money due for the goods and services delivered and supplied. Paragraph 13 of the statement of claim, pleaded the material facts, now relied upon, although it also referred to credit contracts, the breach of which the respondent no longer relies on. The proposed amendments did no more than plead the essential facts with greater clarity.
39 It was submitted on behalf of the respondent that the respondent did not seek to plead a "new case" for a debt for the provision of goods and supply of services, varying so substantially from what had previously been set up that it would require the investigations referred to above. The claim is and always has been for the price of goods and services supplied and delivered and the appellants have previously met that claim in their defence.
40 While it was submitted by the respondent that the Associate Judge was correct to conclude that the claims for goods and services were not new causes of action, it was contended that the Associate Judge made errors in identifying two potential problems regarding the claim for the supply of goods at [25] and [26] of his reasons. The first potential problem identified was that the proposed statement of claim failed to plead that payment for goods was due on a date certain when a date certain (2 April 2008) was expressly pleaded at pars 10 and 11 of the proposed statement of claim. Those paragraphs assert that the "sum has been due and payable by [the defendants] not later than 2 April 2008."
41 A further potential problem with the proposed amended statement of claim was said by Holt AsJ to be that it contained no plea of agency for goods and services. It was submitted that it was speculation by the learned Associate Judge that the goods and services may have been ordered by agents of the defendants, based no doubt on previous versions of the statement of claim. It was argued, in any event, that a plea of agency is not an essential material fact that must be pleaded.
42 The respondent's purpose in identifying these errors was so that in the event that I uphold the appeal and exercise my discretion with respect to the determination of the application, they would be taken into consideration. In other words, because the identification of the so-called problems was erroneous, the "problems" cannot support any argument that the pleadings were embarrassing or deficient.
43 The respondent referred to the learned Associate Judge's analysis in his reasons at [23] of the essential elements of a claim in the case of supply of services and in the case of supply of goods under the Act. It can be seen that his Honour identified the essential elements as request and supply. It was contended that the essential elements in the case of both goods and services, where price has been left indeterminate, are request, supply and demand. If no price has been agreed then there needs to be an indication of the amount claimed.
44 For the purpose of ascertaining whether there is a new cause of action, it is necessary to compare the statement of claim as it was in its current form before the Associate Judge with the proposed amendments to see if the essential facts of the claim pressed in the proposal for supply of goods under the Sale of GoodsAct appear in the current version. References in the current statement of claim to the credit contracts which have no place in the proposed amended statement of claim were highlighted by the appellants and also at [13] of his Honour's reasons:
"[13] The current statement of claim, which is dated 20 February 2014, includes the following allegations. Between 2003 and 2008 Frith-Brown and James operated a farm at Ross and between 2005 and 2008 Frith-Brown also operated a farm at Ouse. Mr Ray Peters was the manager of the farms until about October 2007, after which Mr Peter Cush became the manager of the farms. From 2003 Frith-Brown and James had a credit contract with Roberts, a supplier of rural goods and services, with respect to the farm at Ross. From 2005 Frith-Brown had a credit contract with Roberts with respect to supply of goods and services to the farm at Ouse. Each of the credit contracts contained a provision that property in goods supplied shall not pass until payment (the credit contracts have been inspected by me and contain this provision) and that payment was to be made by the end of the next calendar month following the month in which delivery occurred. Goods and services for the farms were ordered from Roberts by the manager of the farms. By April 2008 the debit balance on the accounts was $830,745.96. On 2 April 2008 Frith-Brown and James agreed with Roberts that they would pay the accounts less a $200,000 credit to be provided by Roberts. By a subsequent agreement made 7 April 2008 the starting amount payable was increased from $830,745.96 to $832,226.07. Frith-Brown and James have not paid anything off the debit balance of the accounts."
45 It was emphasised by the appellants that the original claim was for damages for breach of contract involving two credit contracts. The way in which the sale of goods and services were put was under the credit contracts and until the amendments made by consent in April 2019, grounded a claim for damages. It can be seen from the current version before the learned Associate Judge that the claim for damages was no longer pursued.
46 It was argued that the pleadings as a cause of action under the Sale of Goods Act were deficient. If there is no agreement for the price, and that appears to be the case here, it needs to be pleaded that the agreement is to pay a reasonable price and also that the goods were delivered. The extant statement of claim does not include a plea of an agreement to sell, a plea in relation to price or liability to pay a reasonable price, or a plea as to delivery. Further, these pleas are not all included in the proposed amended statement of claim.
47 It was argued for the respondent that the essential elements with respect to the claim for goods are found in the statement of claim at par 13.
48 I agree with the respondent's contention that the essential facts of request, supply and demand were pleaded in par 13 of the extant statement of claim. In relation to demand, request for payment in the form of invoices is pleaded. Invoices are widely recognised as being a demand for payment.
49 The contention was that the extant statement of claim before the Associate Judge was a claim for damages for breach of contract, not one under the Sale of Goods Act. However, the reference to the First and Second Contract in par 13 of that statement of claim does not necessarily define the nature of the case. The credit contracts are superfluous facts to the claim in its proposed clarified form. Just because a fact is pleaded does not mean that it is an essential fact.
50 The submission that the claim in the version of the statement of claim before the Associate Judge was tied to the credit contracts and was a claim for damages for breach of contract, loses force due to the amendment that had been made by consent in April, redacting aspects of the statement of claim, including the claim for damages.
51 I reject the argument that the proposed amended statement of claim introduces a new cause of action or a new case.
52 I can detect no error in the learned Associate Judge's determination that the proposed amendments did not introduce a new cause of action.
Grounds 2 and 3 – a new cause of action for services
53 Grounds 2 and 3 concern the plaintiff's claim in respect of "services" alleged to have been provided by the plaintiff.
54 It is convenient to first consider ground 3, regarding the way in which the Associate Judge characterised this claim.
55 The Associate Judge concluded that where services are supplied to and accepted by a defendant in circumstances where the remuneration has been left indeterminate by the parties, an actionable claim in indebitatus assumpsit arises:
"[21] An actionable claim in indebitatus assumpsit arises where services are supplied to and accepted by a defendant in circumstances where the remuneration has been left indeterminate by the parties. The claim is for debt and not for damages. The supplier could make demand for what he deserves (as a liquidated amount) and if the demand be too much the amount would be abridged in the discretion of the jury. The action is not based on a contract or on an implied contract, but on a right to restitution based on unjust enrichment. See Pavey and Matthews Pty Ltd v Paul [1987] HCA 5; (1987) 162 CLR 221."
56 It is submitted that as a claim relating to services and given that the parties failed to agree the price payable for the services, the law is that the claim is an action for restitution on a quantum meruit.
57 It was submitted that the learned Associate Judge's reasoning was erroneous. In Pavey and Matthews Pty Ltd v Paul (1987) 162 CLR 221, the High Court at 227, per Mason and Wilson JJ and at 246-257 per Deane J, rejected the implied contract theory which the action of indebitatus assumpsit rested upon and replaced the theory with the concept of unjust enrichment. It was submitted that since Pavey andMatthews, the only available cause of action in relation to services, there being no valid and enforceable contract because the price was not agreed, is an action in restitution for quantum meruit. The appellants referred to more recent High Court decisions affirming this position: Equuscorp Pty Ltd v Haxton [2012] HCA 7, 246 CLR 498 at [29]; Mann v Paterson [2019] HCA 32, 93 ALJR 1164.
58 I do not see that the Associate Judge's characterisation of the cause of action for services has any implications for his decision or the application of r 427(2A). It was not a description that finds its way into the proposed statement of claim. It is not suggested that anything else turns on the description with respect to the elements of the cause of action for the claim concerning a "debt" arising from the supply of services. For example, it is not suggested that his Honour proceeded on the basis that the action involved a contract or an implied contract.
59 The error asserted in ground 3 is immaterial for the purpose of this appeal.
60 In relation to ground 2, the key question is whether the proposed statement of claim introduces a new claim regarding the provision of services.
61 The relevant paragraphs of the proposed amendments are pars 4 and 6, set out above at [9].
62 It is submitted for the appellants that these are "new" claims that have not previously been pleaded. As noted, a submission regarding a concession during submissions on 3 April 2019 as amounting to an abandonment of a pleading is not pressed on this appeal.
63 The key parts of his Honour's decision regarding the claim arising from services are as follows:
"[22] Prior to the decision in Pavey and Matthews, Australian courts had regarded the right to payment for services or goods where the price had been left indeterminate as arising from an implied contract. In the case of the supply of goods this misunderstanding appears to have been enshrined in the Sale of Goods Act 1896, s 13(2). Section 13 is as follows:
'13 Ascertainment of price
(1) The price in a contract of sale may be fixed by the contract or may be left to be fixed in manner thereby agreed, or may be determined by the course of dealing between the parties.
(2) Where the price is not determined in accordance with the foregoing provisions the buyer must pay a reasonable price. What is a reasonable price is a question of fact dependent on the circumstances of each particular case.'
[23] It follows from the general law (in the case of the supply of services) and from the Act (in the case of the supply of goods) that where price has been left indeterminate and an action is to be brought for payment that the essential elements are firstly request (in the case of goods), secondly supply, thirdly acceptance (in the case of services) and fourthly demand (in the case of services). In my view, these elements, with the exception of acceptance, are sufficiently encompassed in the proposed statement of claim at pars 4, 5, 7, 10, 11, 12 and 13 so as to formulate complete causes of action in debt and under the Act."
64 His Honour held that the reformulated claim did not amount to a new claim:
"[51] The proposed new statement of claim proceeds on the proper legal bases for these claims, whereas the 2014 pleading was lengthy and confusing. Much of the confusion arose from the fact that the 2014 pleading of these claims was based in the law of contract rather than formulated as an action based in indebitatus assumpsit and under the provisions of the Sale of Goods Act.
[52] The fact that the legal characterisation of the claim has altered and that the allegations of fact have been reformulated does not necessarily mean that the claim for the value of the services and goods supplied is a new claim attracting the operation of r 427(2A).
…
[54] The existing statement of claim, although clearly designed to formulate a claim based in contract for the recovery of the value of services and goods supplied, does not, in my opinion, by reformulation based on indebitatus assumpsit and the Sale of Goods Act create a new causes of action in the technical sense. The essence of the claim remaining as a claim for the value of services and goods supplied."
65 His Honour went on to conclude at [55] that the proposed plea claiming the value of services and goods supplied did not "attach" the operation of r 427(2A).
66 Aside from the Associate Judge's label of the proposed pleading as indebitatus assumpsit, what is the alleged error here?
67 Again, the appellants relied upon a comparison of the facts pleaded in the proposed statement of claim at pars 4 and 6 set out above with various paragraphs of the extant statement of claim, particularly par 13.
68 The respondent submitted that potential problems with the proposed pleadings identified by the Associate Judge were not problems at all. In relation to the so-called problem that acceptance was not pleaded and yet it was an essential element of the cause of action, it was submitted that it is not an essential element. There was reliance on Lumbers v W Cook Builders Pty Ltd (in liquidation) [2008] HCA 27, 232 CLR 635 at [79] per Gummow, Hayne, Crennan and Kiefel JJ. This argument was not contentious and it was accepted that the onus is cast on defendants to show services were not accepted. Further, it was submitted that the so-called potential problem with respect to the absence of a plea of agency for goods and services was not a problem at all for services just as it was not a problem for the pleadings regarding goods.
69 In relation to the reasoning that there was no new claim, the respondent submitted that the amendments did no more than re-plead the original claim for money due for goods and services delivered and supplied, with greater clarity. The particulars of the goods and services were provided in the form of tax invoices supplied to the appellants which included a description of the goods and services supplied and the price of those goods and services.
70 I reach the same conclusion with regard to the proposed amendments regarding services as I did for goods. Paragraph 13 pleads the material facts. While credit contracts are referred to, they are non-essential facts. The essential facts in a case where the price was indeterminate, are request (see Lumbers at [88]), supply and demand. While there must be acceptance, acceptance can be inferred from the absence of any indication by the putative defendant that the goods or services are not satisfactory. The essential facts have been pleaded in the extant statement of claim at par 13.
71 Having regard to the extant statement of claim and the claim for value of services supplied, and the facts pleaded, I cannot see error in the conclusion of the Associate Judge that the reformulated claim in the proposed amended statement of claim, however described, does not create a new cause of action. Accordingly, his Honour did not have to consider the claims of goods and services under r 427(2A).
Ground 4 – a new cause of action and the application of r 427(2A)
72 The Associate Judge determined that there was a new cause of action pleaded in relation to the claim for an account stated arising out of an agreement on 2 April 2008. His Honour evidently concluded that the claim for an account stated on 2 April was abandoned by amendments that had previously been made to the statement of claim, and this stance of abandonment was confirmed by counsel during an interlocutory hearing on 3 April 2019. The Associate Judge's reasons are as follows:
"[46] The statement of claim dated 20 February 2014, although reciting the alleged 2 April 2008 agreement and claiming damages for its breach contained no claim for debt based on that account stated. Instead reliance for the purpose of a claim in debt was placed on an allegation that there had been an agreement made 7 April 2014, whereby the amount owing on the account stated was claimed to be $632,226.07. This was the amount claimed in the claim for relief in the statement of claim…"
73 There is no contention that the reference to 7 April 2014 should be to 7 April 2008. His Honour then set out pars 18, 19, 20 and 22 of the statement of claim. The version of the statement of claim that the Associate Judge quoted was not the same as the current version that was in existence at the time of his Honour's consideration. The essential difference was that, in the version considered by the Associate Judge, there was a claim for damages, which had been deleted in the final version. This difference has significance given his Honour's remarks and that he regarded the recitation of the 2 April 2008 agreement as grounding a claim for damages for its breach.
74 At [47], the learned Associate Judge went on to state as follows:
"[47] On the hearing of the December 2018 amendment application on 3 April 2019 counsel for the plaintiff conceded that the claim in debt on an account stated on 2 April 2008 in the sum of $630,745.96 had been abandoned in favour of the new claim based on the 7 April 2008 agreement. The transcript from that day includes the following at 47–54: … [transcript set out] …"
75 At [48] and [49] his Honour stated:
"[48] On this point, counsel for the plaintiff, submitted that there had been no express and unequivocal election to abandon. However, the question of election does not arise as the defendants have not asserted that the claims cannot now be pursued because of a complete bar based on election.
[49] The claim in the now proposed statement of claim in the sum of $630,745.96 for debt based on an account stated, having previously been abandoned, is to be treated as a new claim proposed to be initiated in 2019 for a debt arising more than six years ago. The debt claim sought to be reinstated being outside the six year limitation period prescribed in the Limitation Act 1974, s 4(1)(a) attracts the operation of r 427(2A)."
76 It appears from [48] that the so-called concession was not treated by his Honour as binding.
77 The appellants rest their argument about ground 4 on the premise that the conclusion reached by his Honour that the claim for debt based on an account stated had previously been abandoned, was a correct conclusion and brought the proposed amendment into the territory of r 427(2A). The respondent argues that the conclusion was incorrect and r 427(2A) was not engaged. This question must be considered as a preliminary issue to the question of prejudice because the answer to the question will dictate whether we are concerned with prejudice under r 427(2A) or r 427(1).
78 The respondent contends that the conclusion was erroneous. The statement of claim before the Associate Judge pleaded the essential facts at pars 17, 18 and 19, giving rise to an account stated:
• That there was an aggregate balance owing on the appellants' accounts as at 2 April 2008 of $830,745.96 (par 17).
• By the 2 April agreement it was agreed that the appellants would pay the balance of the accounts (ie $830,745.76) less $200,000 (pars 18 and 19).
79 An account stated may take two forms, as explained by Viscount Cave in Camillo Tank Steamship Co Ltd v Alexandria Engineering Works (1921) 38 TLR 134 at 143 and Brennan J in Bank of New South Wales v Brown (1983) 151 CLR 514 at 535-536. Here we are concerned with the second of two forms of account stated described by Viscount Cave at 143 as follows:
"The expression 'account stated', as Mr Jowitt pointed out in his able argument, has more than one meaning. It sometimes means a claim to payment made by one party and admitted by the other to be correct. An account stated in this sense is no more than an admission of a debt out of court; and while it is no doubt cogent evidence against the admitting party, and throws upon him the burden of proving that the debt is not due, it may, like any other admission, be shown to have been made in error. This is the plain result of the authorities, such as Perry v Attwood (1856) 6 El & Bl 691 (119 ER 1021) and Laycock v Pickles (1863) 4 B & S 497 (122 ER 546). Where the transaction is of this character, it makes no difference whether the account is said to be stated or to be 'stated and agreed'; the so-called agreement is without consideration and amounts to no more than an admission. There is a second kind of account stated where the account contains items both of credit and debit, and the figures on both sides are adjusted between the parties and a balance struck. This is called by Mr. Justice Blackburn, in Laycock v Pickles (1863) 4 B &S 497, at p 506 (122 ER 546, at p 549) , a "real account stated", and he describes it as follows:
'There is a real account stated, called in old law an insimul computassent, that is to say, when several items of claim are brought into account on either side, and, being set against one another, a balance is struck, and the consideration for the payment of the balance is the discharge of the items on each side. It is then the same as if each item was paid and a discharge given for each, and in consideration of that discharge the balance was agreed to be due'."
80 It was submitted for the respondent that having regard to the pleadings, it is alleged that there is a failure to do that which was promised pursuant to either the 2 April agreement, the 7 April agreement, or another which was the product of amendments to either agreement. Then it is pleaded that "In the premises Frith-Brown and James are jointly and severally indebted to Roberts", and it was highlighted that this was not an assertion of being "liable in damages", but an assertion of being indebted. While the amounts claimed are the amounts pleaded in respect of the 7 April agreement, it is contended that that is a matter of mere particulars. Further, ultimately, the question of how much is owing is a matter of evidence. It was acknowledged that the form of pleading in par 22 and the use of the word "breach" in the context of an agreement sounds like a claim in damages. It was submitted that this is an inelegant way of saying they breached the contract by failing to do the only thing that they agreed to perform, that is to pay a sum of money, namely a fixed or calculable sum, and the pleading asserts they are in breach of that obligation.
81 It was submitted for the respondent that on any fair view of the discussion between counsel and the court at the interlocutory hearing in April 2019, it could not be said that the respondent expressly and unequivocally abandoned all causes of action other than the action for an account stated on 7 April 2008 or that the respondent had reached a final position with respect to any claim for an account stated. As previously noted, on this appeal the appellants do not argue to the contrary.
82 The appellants contend that there is a material change in the pleadings which enjoins r 427(2A) and that the new agreement is an agreement for a sum certain, while previously it was a matter of evidence, and ascertaining from the evidence, the balance owed. There was no other real development of this point. I fail to see the so-called material change. In the statement of claim before the Associate Judge, a sum certain was pleaded in relation to the two April agreements. While the sum certain in terms of the specific amount pleaded is to be sheeted back to the 7 April agreement, and the pleadings with respect to it, the 2 April agreement was pleaded and the amount claimed arising from the 2 April agreement was ascertainable within the terms of the statement of claim.
83 It can be plainly inferred from the statement of claim (pars 17, 18 and 19) before the Associate Judge that $630,745.76, was the sum certain claimed in relation to the 2 April agreement ie, the amount agreed as the balance $830,745.76, less $200,000. Further it is not the case that the appellants had the task of, or were confronting, the issue of ascertaining the balance; it was pleaded that the balance was agreed in the 2 April agreement. On a proper reading of that statement of claim, there is no question that it is pleaded that the amount claimed is a matter that was agreed rather than to be discerned by looking at the evidence.
84 The so-called material change does not exist.
85 Rule 427(2A) was not engaged. There was no new cause of action pleaded in the proposed amended statement of claim, the claim arising from the 2 April 2008 agreement had not been abandoned and there was no material change in the pleadings. The Associate Judge made an error in concluding that the pleading had been abandoned and that the sub-rule was engaged. The court still had to consider prejudice, but under r 427(1). While ground 4 of the appeal reflects the language of r 427(2A), the contentions in relation to ground 4 and prejudice can all be considered in the context of r 427(1), which invokes the court's general unfettered discretion involving consideration of all relevant factors including prejudice. I will proceed to consider the contentions regarding prejudice.
Ground 4: prejudice
86 The question that arises in respect of ground 4 is whether the defendants will, as a result of the grant of leave to amend, be prejudiced in the conduct of their defence. The Associate Judge addressed two arguments about prejudice raised by the defendants. The first was that the respondent had failed to satisfy the threshold requirement in r 427(2A). The other argument was that, because of the passage of time, the appellants' ability to meet the new pleading had been compromised. Particular emphasis was placed on the fact of the death of Dr James in 2014.
87 In relation to the first argument, the Associate Judge concluded that he was positively persuaded pursuant to r 427(2A) that a grant of leave would not prejudice the defendants in the conduct of their defence. On this matter, his Honour's reasons were as follows:
"[56] … The claim in debt based on the 2 April 2008 agreement was maintained from 2009 until the delivery of the February 2014 statement of claim. James did not die until 2014 and there has been no suggestion that Frith-Brown and James had not provided instructions to their solicitors as to facts which may be relevant on a construction point (if the agreement contains ambiguity) or that proof of such facts has become difficult or impossible. I infer and accordingly find from the previous existence of the claim and from the lack of evidence from the defendants indicating that delay has diminished their ability to defend the claim that the defendants will not be prejudiced in the conduct of their defence if leave to amend to include a debt claim based on the 2 April 2008 account stated plea is granted.
[57] Notwithstanding that I have found that r 427(2A) only applies to the claim on the account stated, the question of prejudice to the defendants, if leave to amend is to be granted, still arises for the purpose of considering the overall justice of whether to allow or disallow the proposed amendment of the claim for the recovery of the value of services and goods supplied.
[58] I will deal with prejudice in the context of whether a fair trial can proceed on the claims for the supply of services and goods and leave matters such as oppression and abuse of process for separate consideration later in these reasons.
[59] Although concerned with a presumption of prejudice where an extension of time is sought to permit a plaintiff to commence a claim outside a limitation period, I consider the analysis in Brisbane South Regional Health Authority v Taylor [1996] HCA 25, (1996) 186 CLR 541 to be apposite to my consideration of possible prejudice arising if leave to amend were granted in respect of the claim for the recovery of the value of services and goods supplied.
[60] In Taylor McHugh J said at 555:
'Legislatures enact limitation periods because they make a judgment, inter alia, that the chance of an unfair trial occurring after the limitation period has expired is sufficiently great to require the termination of the plaintiff's right of action at the end of that period. When a defendant is able to prove that he or she will not now be able to fairly defend him or herself or that there is a significant chance that this is so, the case is no longer one of presumptive prejudice. The defendant has then proved what the legislature merely presumed would be the case. Even on the hypothesis of presumptive prejudice, the legislature perceives that society is best served by barring the plaintiff's action. When actual prejudice of a significant kind is shown, it is hard to conclude that the legislature intended that the extension provision should trump the limitation period.'
[61] Although in dissent in the outcome, some general observations of Kirby J are not inconsistent with the views expressed by the other judges in Taylor. In particular, I refer to 566-567 where his Honour said:
'It will be rare that the passage of time does not cause at least some disadvantages to a prospective defendant (for example the erosion of memory; the loss of documents; and the death, departure or disappearance of witnesses). But precisely what that disadvantage is in a particular case is better determined on evidence than on the basis of judicial generalities about time, the importance of finality and the usual desirability of prompt action for the fair trial of contested issues.
It is always open to a proposed defendant, resisting an application for extension of time, to call evidence of any specific detriment it would suffer if an order were made. The appellant did so in the present case. If any such evidence is called, a court must consider it carefully in exercising its residual discretion. If a defendant does not call evidence, or calls evidence which is unpersuasive or insignificant, provided it is reasonable to infer that some evidence was available to it in the circumstances the defendant cannot complain if the court concludes that no particular prejudice, over and beyond the generalities, could have been established by it. This is simply another way of saying that, because a prospective defendant has an interest in keeping the limitation bar in place and in resisting an extension that lifts it, it may be inferred that he or she would ordinarily place before a court evidence of specific prejudice pertinent to the exercise of the court's discretion. If the prospective defendant does not do so, he or she cannot justly complain if the court infers, and then holds, that the defendant has failed to demonstrate such prejudice. This is not to shift the burden in the application from the applicant to the defendant. It is simply to recognise that the burden of persuading a court on the particular issue of specific prejudice lies on the party making any such suggestion. This is what is meant by the "evidentiary onus".'
[62] The question is whether a fair trial on the newly framed pleading can occur.
[63] I have already found that the defendants can still obtain a fair trial on the account stated claim. The claim for the reasonable value of services and goods supplied is in the existing pleading (albeit based in contract). In respect of this latter claim, the proposed new pleading better frames the claim. The basic factual allegations and possible areas of factual dispute have not been enlarged. This being so, and the defendants not having identified any specific prejudice, such as the unavailability of relevant business records or the unavailability of the farm managers to give evidence, I conclude, notwithstanding the death of James in 2014, that the chances of a fair trial would not be materially diminished by allowing the amendment."
88 Leaving to one side arguments before this Court that the proposed amended statement of claim introduced a new cause of action, now disposed of above, the appellants contended that the Associate Judge's reasons were erroneous for the following reasons:
• The learned Associate Judge erroneously failed to give any consideration to the prejudice resulting from Dr James' death in terms of her inability to provide instructions to her lawyers or give evidence at trial.
• His Honour failed to give any consideration to "presumptive" or "general" prejudice in relation to the claims.
• In reasoning that the defendants should have given evidence about specific prejudice including evidence that the defendants had not provided instructions to their solicitors as to relevant facts. His reasoning was contrary to decisions of the High Court in Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541; Prince Alfred College v ACD [2016] HCA 37, 258 CLR 134. As a consequence of these authorities, the party seeking leave to amend carries the onus of persuading the Court that it ought to exercise a discretion in the applicant's favour; there is only an evidentiary onus on the party resisting the grant of leave to raise any consideration telling against the exercise of the discretion; whether prejudice to the party resisting the application to amend is likely to thwart or prejudice a fair trial is to be answered by reference to the situation at the time of the application.
• The learned Associate Judge attached undue weight to what his Honour perceived to be a lack of evidence led by the defendants. In effect, he erroneously required the defendants to lead evidence to disprove prejudice when all that was required was that they lead sufficient evidence to raise an issue as to the existence of the fact of prejudice: Momcilovic v The Queen [2011] HCA 34, 245 CLR 1 at [467] and [665].
89 The respondent argued that the Associate Judge did take into account Dr James' death and it was an obvious fact that did not require mentioning that she could not provide instructions to her lawyers and give evidence at trial. The onus of persuasion carried by an applicant has been discharged in this case. This case is to be distinguished from other cases which were not commenced within time, and where the application was to extend time to commence a proceeding. Here, the reason that the application was made was apparent from the court proceedings. It was made in the face of an application to strike out the existing pleading, and when the applicant was confronted with problems associated with the existing statement of claim.
90 It was submitted that his Honour had regard to presumptive or general prejudice and whether a fair trial could proceed. At [64] of his Honour's reasons, not set out above, reasons given in the context of whether there was an abuse of process, his Honour acknowledged that the defendants had already been put to significant delay and the first defendant had been subjected to stress.
91 Further, it was submitted that the amendments did not result in prejudice or delay but rather, clarified the issues and was likely to bring the litigation to a conclusion sooner than if the amendments had not been made.
92 The arguments in reply identified specific prejudice. It was said that prejudice arises from the refined claim for services which would cast an onus on the defendants with respect to acceptance. This is a change which has developed since Dr James has died. Instructions cannot be taken from Dr James on that issue. There was also prejudice identified with respect to the claim of account stated with respect to the 2 April 2008 agreement and the change from a claim requiring consideration of the balance owed compared with a sum certain. I do not need to consider that argument as I have already disposed of it on the basis that there is no change to the pleadings in that respect.
93 The High Court case of Brisbane South Regional Health Authority v Taylor (above) was concerned with an exercise of discretion to order an extension of the limitation period under the Queensland Limitations of Actions Act 1974. The headnote provides references to the principles invoked by the appellants:
"Held, by Dawson, Toohey, McHigh and Gummow JJ, Kirby J dissenting, that an applicant for an extension of time under s 31(2) does not have a presumptive right to an order once the conditions in s 31(2)(a) and (b) have been satisfied. An applicant still bears the legal onus of showing that the justice of the case requires the discretion to be exercised favourably, and to do so must prove that an extension beyond the limitation period would not result in significant prejudice to the prospective defendant. Section 31(2) does not require a weighing process between the potential prejudice to the applicant and prospective defendant."
94 See also the judgment of Toohey and Gummow JJ at 547 and the judgment at 551 regarding what is known as "general prejudice" in the context to limitation periods.
95 In Prince Alfred College Incorporated v ADC (above), the High Court, constituted by a Full Bench of seven judges was again concerned with the exercise of discretion to order an extension of a limitation period. In that case, the plaintiff had been sexually abused in 1962 when he was 12 years of age and a boarder at an independent school. He subsequently developed a psychological injury. In 1997, he decided not to sue the school. He sued the person responsible for the abuse and those proceedings settled. In 2008, he commenced proceedings against the school alleging vicarious liability. By this time, a number of witnesses had died or were unable to give evidence and the psychologist whom the plaintiff had first consulted in 1996 had destroyed his notes.
96 In Prince Alfred, the High Court applied Brisbane South including passages from the judgments of McHugh and Kirby JJ, referred to by the Associate Judge. The judgment of French CJ, Kiefel, Bell, Keane and Nettle JJ at [99]-[100] referred to two fundamental propositions established by the High Court's decision in Brisbane South:
"First, an applicant for an extension of time must prove the facts which enliven the discretion to grant the extension and also show good reason for exercising the discretion in his or her favour. An extension of time is not a presumptive entitlement which arises upon satisfaction of the pre‑conditions that enliven the discretion. The onus of persuasion is upon the applicant for an extension of time. The exercise of the discretion to grant an extension of time must take account of the reasons for the limitation regime, and the discretionary nature of the decision to be made must be respected when conducting appellate review of a primary judge's decision. In Brisbane South Regional Health Authority v Taylor, McHugh J said:
'The enactment of time limitations has been driven by the general perception that "[w]here there is delay the whole quality of justice deteriorates".'
Secondly, the purpose of the legislative conferral of the discretion is to ensure a fair trial on the merits of the case. The loss of evidence which will tend against the prospects of a fair trial will usually be a fatal deficit in an argument that good reason has been shown to exercise the discretion to grant an extension. As McHugh J pointed out in Brisbane South Regional Health Authority v Taylor, the justice of a plaintiff's claim is seldom likely to be strong enough to warrant a court reinstating a right of action against a defendant who, by reason of the delay, is unable fairly to defend itself or is otherwise prejudiced. His Honour had earlier observed that, in cases of long delay, prejudice may exist without the parties or anyone else realising that it exists." [Footnotes omitted.]
97 The case of Prince Alfred was concerned with specific prejudice. In Brisbane South, McHugh J having quoted "[w]here there is delay the whole quality of justice deteriorates." from R v Lawrence [1982] AC 510 at 517, per Lord Hailsham of Marylebone LC, went on to note:
"Sometimes the deterioration in quality is palpable, as in the case where a crucial witness is dead or an important document has been destroyed. But sometimes, perhaps more often than we realise, the deterioration in quality is not recognisable even by the parties. Prejudice may exist without the parties or anybody else realising that it exists. As the United States Supreme Court pointed out in Barker v Wingo, 'what has been forgotten can rarely be shown'. So, it must often happen that important, perhaps decisive, evidence has disappeared without anybody now 'knowing' that it ever existed. Similarly, it must often happen that time will diminish the significance of a known fact or circumstance because its relationship to the cause of action is no longer as apparent as it was when the cause of action arose. A verdict may appear well based on the evidence given in the proceedings, but, if the tribunal of fact had all the evidence concerning the matter, an opposite result may have ensued. The longer the delay in commencing proceedings, the more likely it is that the case will be decided on less evidence than was available to the parties at the time that the cause of action arose."
98 While we are not concerned with an application for an order extending a limitation period, the principles referred to above apply to this case and were treated by the Associate Judge as having application. Concerns with respect to general or presumptive prejudice, carry less force in a case of a recasting of a claim rather than the introduction of a new cause of action or a new case. It can be assumed that his Honour was mindful of disadvantage arising from general prejudice. General prejudice was referred to by McHugh and Kirby JJ in the passages his Honour quoted from. His Honour had regard to the overall justice of the case and the prospect of a fair trial: see [57] and [63]. General prejudice is a fundamental concept in the case management of litigation, and his Honour is a very experienced judicial officer of this Court in a specialty jurisdiction concerned with the efficient management of litigation.
99 I can see no error in the approach taken by the Associate Judge. His Honour considered the possibility of specific prejudice. In relation to the claim of account stated, his Honour noted at [56] that such a claim was extant at the time before and at Dr James' death. The possibility of specific prejudice is diminished further when it is borne in mind that this claim has not been abandoned as his Honour found.
100 The appellants argue on this appeal that the affidavit of Mr Dillon sworn on 1 September 2017 and filed by the plaintiff is evidence that relevant documents have been (or may have been) lost or destroyed by the plaintiff, or can no longer be accessed because the plaintiff's head office was relocated (likely after the commencement of these proceedings in 2009) and the plaintiff transitioned from one email program to another in 2016 (that is, during the course of these proceedings). This affidavit was filed but not in relation to any of the interlocutory applications before Holt AsJ, leading to the decision now under appeal. This affidavit is not part of the appeal book before me and it seems that the defendants' written or oral submissions before Holt AsJ did not draw it to his attention or rely upon it as raising specific prejudice. It was submitted before this Court that: "on the affidavit evidence of Mr Dillon, the defendants have satisfied the evidential burden of proof …", yet, as noted, the affidavit was not specifically relied upon in those proceedings before the Associate Judge.
101 Notwithstanding these matters, I have had regard to the affidavit for the purpose of considering the appellants' argument. The tenor of the affidavit is to explain why not all of the documents that had been in the plaintiff's possession, custody or control are available. The appellants do not now assert that any of these documents or categories of documents carry significance for their case. I consider that at most, the contents of the affidavit are illustrative of general prejudice arising from delay in these proceedings. Furthermore, the so-called prejudice has not been linked to the proposed amendments in the sense that there is no argument before this Court (or the learned Associate Judge) that documents assuming significance because of the proposed refinement to the pleadings may have been lost or destroyed.
102 The appellants assert in their arguments before this Court in reply, that there is also specific prejudice because it has recently emerged from the recasting of the claim that one of the issues is the element of "acceptance", and moreover, the appellants have the onus of proof with respect to it. Regardless of who bears the onus, if the cause of action has always been there in the pleadings, and "acceptance" is an element of this cause of action, then, on the material before his Honour, there was no foundation for an inference of specific prejudice. There may be prejudice arising from a misapprehension about the claim, but the appellants cannot expect the court to divine that, and if it is to be relied upon there would need to be some evidence about it. The court would not find such prejudice on the basis of a suggestion during submissions. Possibilities and speculation are not sufficient.
103 In relation to the claims regarding services and goods, it will be remembered that they were in the existing statement of claim. His Honour concluded that the proposed new statement of claim "better frames the claim". That conclusion is not challenged. It is reasonable to anticipate that the litigation may now proceed more efficiently. That is in the interests of all the parties and is a factor that weighs in favour of the amendment pursuant to r 427(1). His Honour stated that the defendants have not identified any specific prejudice such as the unavailability of relevant business records or unavailability of the farm managers to give evidence. It is not contended otherwise. His Honour did not overlook the death of Dr James in 2014 and specifically made reference to it. But that prejudice cannot be sheeted back to the proposed amendment as it is a prejudice that has been there since 2014. It was reasonable for his Honour to observe that the respondents to the application to amend had not raised any particular facts that may ground specific prejudice.
104 It is submitted that his Honour stated that the appellants were required to lead evidence to disprove prejudice when his Honour should have proceeded on the basis that all that was required was that they lead sufficient evidence to raise an issue as to the existence of the fact of prejudice (Momcilovic v The Queen (above) at [467] and [665]). I reject that characterisation of his Honour's approach. All his Honour did was point out a complete absence of suggestion of, (in the context of the claim for an account stated) and a failure to identify, specific prejudice (in relation to the claim regarding goods and services).
105 One of the appellants' arguments was that there needed to be evidence from the respondent, as the applicant for the order, explaining the application. But, as the respondent submitted in this Court, the genesis of the application to amend was plain from the history of the pleadings and interlocutory applications. It was an effort to refine existing pleadings and, as his Honour stated, the proposed new pleadings better framed the claim and the basic factual allegations and possible areas of dispute.
106 I can see no error in the conclusion that the chances of a fair trial would not be materially diminished by allowing the amendment. Ground 4 has not been made out.
Ground 5 – failure to take matters into account in exercising discretion under r 427(1)
107 Ground 5 asserts that the learned Associate Judge erred in the exercise of his discretion in determining to grant the application to amend the statement of claim by failing to take into account:
"a factors of oppression and the abuse of process;
b The letter dated 2 April 2008 and its potential discordance with the plea at para 8 of the proposed Statement of Claim;
c the fact that there were possible omissions in the proposed Statement of Claim;
d the fact that the proposed Statement of Claim did not contain the necessary plea that a price had not been agreed;
e case management principles;
f the fact that the proposed Statement of Claim comprised causes of actions which were statute barred;
g the fact that the plaintiff was attempting to introduce a cause of action in quantum meruit, which cause of action was statute barred;
h the fact that all causes of actions in the proposed Statement of Claim were pleaded on the basis of 'multiple agreements';
i that the proposed Statement of Claim was embarrassing."
108 The asserted errors in (f) and (g) fall away in light of the conclusion reached above that the proposed amendments did not introduce a new cause of action. The remaining asserted specific errors require consideration.
(a) failure to take into account factors of oppression and abuse of process
109 The appellants' grievance is that the learned Associate Judge did not address the contentions made before his Honour about abuse of process.
110 His Honour was faced with a number of interlocutory applications. One of them was the application to amend the statement of claim. There were cross-applications lodged by the appellants. One of those was an application filed 10 May 2019 for orders including the following:
"On the grounds that the plaintiff's claim is an abuse of process of the Court that the action be dismissed and that judgment be entered for the defendants on the plaintiff's action.
Alternatively, … on the grounds that the claim is an abuse of process of the Court that the plaintiff's action be permanently stayed."
111 As to this application for a stay of proceedings his Honour stated as follows:
"[68] The application is yet to be heard. At the time it is heard it should be known whether the statement of claim has been amended as now proposed, whether if amended it is liable to be struck out for the failure to plead the matters in respect of which I have expressed reservations earlier in these reasons and whether the plaintiff wishes to put forward yet another iteration of the statement of claim. I see no reason why a grant of leave to amend the plea would affect the defendants' prospects on a dismissal or stay application. The plaintiff, notwithstanding the pending stay application, asked me to deal with the amendment application first and having heard from the defendants I agreed to that course.
[69] The application for a stay based on an abuse of process is best considered independently of the present pleading application and so I will not withhold leave to amend, if otherwise appropriate, on abuse of process grounds."
112 In his conclusions his Honour stated:
"[72] I do not consider that refusing leave to amend on the grounds of oppression or abuse of process is necessary or desirable. An application for dismissal or a permanent stay is pending and it will be heard and determined in due course."
113 It was submitted that his Honour ought to have taken into account considerations that would bear on abuse of process and should not have put those to one side to deal with later. There was a complaint that the course taken has led to a fragmentation of proceedings. It must be noted at the outset of consideration of this asserted error, that the course taken of dealing with the amendment application first and the stay application later, was at the request of the respondent.
114 It was contended that regardless of the sequencing of the hearing of the applications, his Honour erred in not taking into account considerations relevant to an abuse of process in exercising his general discretion under r 427(1). Considerations referred to include the length of delay, protracted history of the proceedings, the prescribed time limit and the lack of explanation for the proposed amendment. Reliance was placed on a decision of the Full Court of Tasmania in Hill v Iluka [2002] TASSC 113 at [23]. That case was concerned with an application to extend a time limit and the exercise of a discretion pursuant to s 5(3) of the Limitation Act and the test as to whether it is just in the circumstances of the case to extend the time within which proceedings may be commenced. In that case, the Full Court regarded those considerations as relevant to that discretion. There was also reliance on the High Court decision of UBS AG v Tyne [2018] HCA 45, 92 ALJR 968 at [45]:
"To insist, for example, on 'inexcusable delay' as a precondition of the exercise of the power to stay proceedings as an abuse of process is to fail to appreciate that any substantial delay is apt to occasion an increase in the cost of justice and a decrease in the quality of justice. And other litigants are left in the queue awaiting justice."
115 It is not contentious that the broad considerations of abuse of process and oppression, and the specific factors identified in Iluka are relevant and ought to be taken into account in the exercise of a discretion pursuant to r 427(1).
116 It is the circumstances of this case which must be considered. The amendment was a refinement of an existing pleading and the context for the proposed amendment meant that an explanation was not called for or warranted. The factors of the length of delay and protracted history of the proceedings were taken into account by the Associate Judge. His Honour referred in [64] to the "unfortunate procedural history of the matter starting with writs having first been filed in 2008". His Honour added: "Self-evidently, the defendants have already been put to significant delay and expense" and that the first defendant "has been subjected to stress over the life of the litigation."
117 His Honour was alert to modern principles of case management and, of particular significance in the context of the appellants' argument, was alert to how oppression or an abuse of process might arise on an application to amend. His Honour referred to a recent High Court decision of Rozenblit v Vainer [2018] HCA 23, 262 CLR 478, which concerned the appropriateness of imposing a stay based upon an impecunious plaintiff's failure to pay costs previously ordered. At [65], his Honour referred in particular to the judgment of Keane J at [41] and [42]:
"[65] Rozenblit v Vainer [2018] HCA 23; (2018) 92 ALJR 600 concerned the appropriateness of imposing a stay based upon an impecunious plaintiff's failure to pay costs previously ordered. Keane J had occasion to consider how oppression or an abuse of process might arise on an application to amend and observed at [41] and [42]:
'41 It has long been accepted that an order for costs in favour of a party adversely affected by the manner in which litigation is conducted may be a necessary means of preventing injustice resulting from the consequences of incompetence or inefficiency falling short of deliberate harassment or the pursuit of a collateral purpose on the part of an opposing litigant. The decision of this Court in Aon Risk Services Australia Ltd v Australian National University was a reminder that inefficiency or incompetence in the conduct of litigation may unjustly burden the other parties to the litigation, and the administration of justice itself. That decision made it clear, to the extent that clarity was necessary, that orders for costs will not always be sufficient to prevent injustice occasioned by inefficiency or incompetence in the conduct of litigation. The broader point for which Aon Risk is presently relevant is that injustice in the conduct of litigation cannot be justified by invoking the interests of justice.
42 Litigation is sufficiently stressful and expensive for all concerned without the unnecessary aggravations of additional cost, stress, distraction and delay occasioned by inefficiency, incompetence or sheer disregard of the rules. To the extent that the contention advanced on behalf of Mr Rozenblit reflects an assumption that inefficiently or incompetently conducted litigation, and the waste in terms of time and money inflicted upon the other party or parties, is nevertheless consistent with the promotion of access to justice because the end may ultimately justify the means, that assumption must be rejected. Inefficient or incompetent conduct of litigation may cause injustice even if it is not intended to do so. Litigation that is conducted inefficiently, incompetently or in disregard of the rules by one party is no less oppressive to the other party because it is not intended to be oppressive. And it is no less oppressive because the litigant who engages in such conduct is impecunious'."
118 His Honour at [66] went on to note that the conduct of the litigation to date by the plaintiff had been inefficient and that the defendants have a viable basis for claiming that the litigation should now be put to an end. His Honour stated "However, the question of whether there ought to be a permanent stay or dismissal of the claims, in my view in the circumstances of this case, should be resolved on the hearing of an application for a stay and not on the hearing of this application to amend."
119 As I read his Honour's reasons, he was leaving the resolution of that application to a later date and particularly the larger issue of whether there had been an abuse of process, but not saying that sub-issues like delay and the history of the proceedings were immaterial to his discretion under r 427(1). It seems that he took them into account. There was no specific error in that approach.
120 If I am wrong in my reading of the Associate Judge's reasons and he was intending to leave all sub-issues pertaining to an abuse of process argument to a later day, then I would respectfully regard that as an incorrect approach. The delay and protracted history of the proceedings are factors which should have been taken into account. Overall, they weigh against an amendment. However, I would not interfere with the Associate Judge's discretion in the circumstances of this case if this is the only error. The exercise of discretion allowing the amendment was not unreasonable in the face of a proper consideration of delay and the protracted history of proceedings. There were other factors to consider which weighed in favour of the amendment. One of them was that the amendment refines and clarifies the pleadings and is likely to lead to efficiencies in the progress of the litigation, to the benefit of the parties.
(b) the letter dated 2 April 2008 and its potential discordance with the plea at par 8 of the proposed statement of claim
121 The argument with respect to this assertion of error referred to the fact that par 8 of the proposed statement of claim pleaded an account stated in the sum of $635,745.96 and particularises the account stated by reference to a document signed by the first defendant and Dr James. However, it is pointed out that there is an inconsistency in that the written document does not specify a balance of accounts and in fact states only "($) balance of accounts".
122 A document adverted to in the pleadings forms part of the pleading and may be read on a pleading application and so, taken into consideration for the purpose of the argument: Driveforce Pty Ltd v Gunns Ltd [2010] TASSC 23 at [8].
123 It was submitted that, given the inconsistency, the claim is untenable and has no prospect of success and should not have been left as an issue for trial.
124 There is only discordance if the document represents the entirety of the agreement. It will be a question for the trial whether there is other evidence of an agreement of a "sum certain".
125 At [34] his Honour stated:
"[34] Although the proposed statement of claim formulates a cause of action on an account stated, the defendants say that the claim is untenable as the document alleged to be the written record of the account stated does not contain reference to the specific sum of $630,745.96. The construction of the document, however, should be left to the trial for resolution after all of the evidence is in and detailed arguments have been presented."
126 I cannot see any error in treating this "discordance" as an issue for the trial or potentially, future applications such as a request for further particulars.
(c) the fact that there were possible omissions in the proposed statement of claim
127 These possible omissions were those identified by his Honour in his reasons at [24], [25] and [26]. These possible omissions were only "potential" problems that did not require determination. In any event, as noted above, they are not deficiencies in the proposed amended statement of claim. They are not problems, and any failure to have regard to them as problems weighing in favour of an exercise of discretion to disallow the amendment could not be an erroneous approach. There is no error here.
(d) the fact that the proposed statement of claim did not contain the necessary plea that a price had not been agreed.
128 The argument is that a pleading is deficient in the case of a sale of goods or supply of goods claim under the Sale of Goods Act where there is no averment that price is not agreed. If it is a case where there is no agreement for the price, as appears to be the case here, that absence of agreement needs to be pleaded as does the plaintiff's assertion that the obligation is to a pay a reasonable price. The respondent argued that a plaintiff is entitled to say there was an agreed price, by reference to invoices or, in the alternative, to say that there was not an agreed price and there is an entitlement to a fair market price. It was submitted for the respondent that the absence of a pleading that no price had been agreed is not the absence of a material fact which affects the validity of the pleading.
129 The appellants relied upon Bullen & Leake and Jacob's Precedents of Pleadings, 13th ed, precedent 540, for a form of pleading under s 8(2) of the Sale of Goods Act (UK) (equivalent to s 13 of the Tasmanian Sale of Goods Act). It was submitted for the respondent that price is a particular and need not be pleaded. It was pointed out that the Bullen & Leake precedents are useful examples but there will be other satisfactory and adequate ways of drafting pleadings. I would add that merely because an assertion of fact is included in a precedent, does not necessarily reflect binding authority that it is a material fact. Rather, the precedent may emerge from good practice and the desirability for clarity about the cause of action. Adopting the words of the preface to the 13th ed Bullen and Leake, and Jacob's Precedents of Pleadings: "The precedents, of course, are not authoritative but they nevertheless provide a practical and effective guide or model as to what is required in any particular case."
130 In light of the absence of authority for the proposition advanced by the appellants, I do not reach a determination that there was a failure to plead a material fact, namely that a price had not been agreed. This argument is best left for the trial when the court will no doubt hear comprehensive submissions and the material facts will fall for determination. Error has not been disclosed.
(e) failed to take into account case management principles
131 The appellants contend that the pleadings in the proposed amended statement of claim are deficient. The Associate Judge referred to some of the appellants' complaints about the pleadings and, without determining whether they were valid, treated them as capable of being adequately dealt with by case management orders relating to the delivery of particulars. A complaint by the appellants that the proposed plea lacked clarity was dealt with as follows by the Associate Judge:
"[38] The defendants have complained that the pleading on the causes of action for the price of services and goods supplied lacks clarity in that there is a failure to distinguish between services supplied and goods delivered. There is also the complaint, which I have already mentioned, that the pleading itself does not contain details of the individual transactions. These matters can be adequately dealt with by case management orders relating to the delivery of particulars and requiring the defendants to respond."
132 It is argued by the appellants that his Honour overlooked case management principles stated in Aon Risk Services Australia Limited v Australian National University [2009] HCA 27, 176 CLR 175. Principles referred to include:
"a Parties have choices as to what claims are to be made and how they are to be framed, but limits will be placed upon their ability to effect changes to their pleadings; that is why, in seeking the just resolution of the dispute, reference is made to parties having a sufficient opportunity to identify the issues they seek to agitate (p127);
b A party does not have an entitlement to amend a pleading, subject to payment of costs by way of compensation (p217)."
133 The learned Associate Judge did not hold that the complaints about the pleadings, referred to in [38] above, revealed material facts which had not been pleaded, or were embarrassing in the sense that they lacked specificity, were incomplete or lacked clarity, or would tend to prejudice or delay the fair trial of the proceeding. I conclude there was no error in his Honour's determination that information or details lacking about these matters could be dealt with by further particulars. As for whether his Honour erred by not mentioning case management principles, the simple answer to that is his Honour did mention them in [9] and [73] of his reasons set out above at [19] and [11]. In any event, his Honour did not need to. They did not arise in this context, given the nature of the information sought and the remedy available of "case management orders". Furthermore, these principles are so fundamental to his Honour's jurisdiction that it can be assumed his Honour was mindful of them, unless of course, the determination of the particular case indicates that those principles have been breached or overlooked. That is not the case here.
(h) the fact that all causes of actions in the proposed statement of claim were pleaded on the basis of "multiple agreements"
134 This asserted error arises from para 6 of the proposed amended pleading.
135 Presumably, "agreements" is a reference to the credit agreements which featured in the earlier statement of claim. The pleading omits any explanation of what the "agreements" are.
136 The proposed pleading lacks specificity and clarity evidenced by these questions: "What are the agreements? What are the terms? Are they oral or written?" Its compendious nature covering both goods and services, when goods and services were delivered to the first defendant but only goods were delivered to Dr James, adds to the difficulties.
137 Holt AsJ adverted to aspects of the arguments raised, such as the compendious nature of the pleading in that it did not distinguish between claims in respect of the supply of services and the claims in respect of the supply of goods. His Honour referred to the function of pleadings and particulars. In particular his Honour stated at [30]:
"… the fact that particulars are needed to fill in the picture of the plaintiff's causes of action with sufficiently detailed information to put the defendants on guard as to the case to be met and to enable them to prepare for trial does not mean that a pleading, which otherwise covers the elements necessary to formulate complete causes of action, is defective. Appropriately precise definition of the facts in dispute can be achieved by the use of case management rules."
138 I do not find error in the approach of Holt AsJ in determining that the deficiencies highlighted by the appellants with respect to the agreements can be cured by particulars.
failed to take into account that the proposed statement of claim was embarrassing.
139 An argument that the proposed amendments would result in a statement of claim that was lacking in clarity was dealt with by his Honour at [38] – [40] of his reasons, set out above. His Honour rejected arguments that various pleadings in the proposed statement of claim were deficient or lacking in clarity such as to warrant dismissing the application to amend. His Honour expressly concluded that the proposed statement of claim was not so lacking in clarity that it might be characterised as embarrassing or productive of prejudice or delay in the fair trial of a proceeding: [40]. Further, his Honour stated at [71]:
"[71] I have not accepted the defendants' argument presented to date that the proposed plea fails to disclose causes of action or lacks clarity to the extent that allowing it would tend to prejudice or delay the fair trial of the proceedings."
140 I have concluded that his Honour did not err in that regard. The argument that the statement of claim in particular respects was embarrassing was correctly rejected. This ground of appeal falls away.
Conclusion and order
141 I have adverted to the fact that if an error in respect to oppression and abuse of process considerations had been made, I would not interfere with the Associate Judge's exercise of discretion to allow the amendment. Having considered the remaining asserted errors, my view in that regard is confirmed. In the circumstances of this case, the conclusion that the amendment should be made, was available to his Honour as a proper exercise of discretion. His Honour was influenced by the fact that "the proposed pleading now properly characterises the claim for payment for the supply of services and goods. The allegations in respect of the latter claim have been refined and … that such refinement, if allowed, will not diminish the chances of a fair trial." Further, he was "positively persuaded that the justice of the case lies with granting leave to make the amendment sought". I would not interfere with the outcome unless it was not reasonably open to his Honour. The outcome and the various considerations at play indicate a proper exercise of discretion. Furthermore, it has not been shown that the order allowing the amendment was in terms that were unjust or, more generally, that such an order would produce injustice. I have not found error, but if I had found error on the point mentioned, I would leave the order intact.
142 For these reasons, an order will be made dismissing the appeal.
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