Gartner v Ernst & Young (No 2)

In the matter of Gartner v Ernst & Young (No 2), the applicants, members of the Gartner Family Group, sought to amend their statement of claim to include allegations of breach of fiduciary duty and unconscionable conduct against the professional advisers, Ernst & Young. The court was tasked with deciding whether the proposed amendments to the statement of claim were permissible, specifically whether the allegations of fiduciary duty and unconscionable conduct were adequately pleaded and if the proposed amendments met the requirements for leave to amend under the rules of court.

The court considered the nature of the relationship between the professional advisers and the clients, and whether a fiduciary relationship existed. It also examined the nature of the alleged unconscionable conduct and the sufficiency of the particulars of loss. The court held that while the allegations were not sufficiently particularised, it was not necessary to strike out the proposed amendments outright. The court allowed the applicants to further amend their statement of claim, excluding certain paragraphs that did not adequately plead a cause of action, while permitting others to proceed pending further particulars and expert evidence.

The court's reasoning was that the proposed amendments, while not perfect, contained sufficient allegations to potentially establish a case of breach of fiduciary duty and unconscionable conduct. The court emphasised that the particulars of loss would likely become clearer as the litigation progressed and as the applicants provided more detailed evidence of their losses. The court also noted that separate trials might be required for different issues, and that the professional advisers would need a clearer pleading of loss to properly respond to the claims against them.

The final orders of the court allowed the applicants to amend their statement of claim as varied, excluding certain paragraphs, and directed the parties to proceed with the amended statement of claim subject to any further orders the court might make in the future.