Guoyi Su v The Star Entertainment Group Limited

[2021] NSWSC 243

Supreme Court

New South Wales

Medium Neutral Citation:

Guoyi Su v The Star Entertainment Group Limited [2021] NSWSC 243

Hearing dates:

8 March 2021

Date of orders:

16 March 2021

Decision date:

16 March 2021

Jurisdiction:

Common Law

Before:

Lonergan J

Decision:

The plaintiff has leave to file and rely upon the Amended Statement of Claim in the form annexed to the Amended Notice of Motion filed 2 March 2021.

Catchwords:

CIVIL PROCEDURE – pleadings – amendment – application for leave to amend statement of claim – early in proceedings - application granted

Legislation Cited:

Casino Control Act 1992 (NSW)

Civil Procedure Act 2005 (NSW), ss 56, 57, 58, 64

Uniform Civil Procedure Rules 2005 (NSW), rr 14.17, 19.1

Cases Cited:

Aon Risk Services Limited v Australian National University (2009) 239 CLR 175 [2009] HCA 27

Duke Group Ltd v Arthur Young (No 2) 1991 55 SASR 24

Category:

Procedural rulings

Parties:

Guoyi Su (Plaintiff)
The Star Entertainment Group Limited (Defendant)

Representation:

Counsel:
S Gray (Plaintiff)
D Wong (Defendant)

Solicitors:
Dixon Holmes Lawyers (Plaintiff)
King & Wood Mallesons (Defendant)

File Number(s):

2020/236163

Publication restriction:

Nil

Judgment

1. By Statement of Claim filed on 13 August 2020, the plaintiff, Mr Su, alleges that the defendant, The Star Entertainment Group Limited (SEGL) breached its gambling contract with him and failed to pay to him $13,853,500 that he won playing Baccarat at the Star Casino over a 7 day period in January 2020.

2. Correspondence between the solicitors acting for the parties ensued, and Mr Su now seeks leave to file a further Statement of Claim adding another corporate entity, The Star Pty Limited, as second defendant and pleading some additional material facts to underpin the case against SEGL.

3. Listed for hearing before me as duty judge was both the Notice of Motion to amend the Statement of Claim and a Notice of Motion filed by SEGL on 10 December 2020 seeking that the Statement of Claim be struck out and/or dismissal of the proceedings.

4. The wildly optimistic timeframe given to the Registrar for dealing with these two motions was 1 hour. It was agreed by counsel Mr Gray for Mr Su and Mr Wong for SEGL (and The Star Pty Limited) that the application to amend should be heard and determined first.

5. For the reasons that follow, I have determined that the plaintiff’s application to amend should be granted.

The affidavit evidence

6. Mr Su relied upon three affidavits of his solicitor, Donald Junn, affirmed on 17 December 2020, 21 December 2020 and 2 March 2021.

7. The 17 December 2020 affidavit annexed letters, apparently on SEGL letterhead, which Mr Su says confirms his winnings in January 2020, and correspondence received from SEGL’s in-house counsel and solicitors. Given the contents of the letters from the in-house counsel and solicitor, an amended statement of claim was prepared adding “The Star Pty Limited” to the proceeding. That iteration has been superseded by the current version.

8. The affidavit of Mr Junn of 21 December 2020 annexed letters on SEGL letterhead from 2017 and 2019 regarding winnings and a telegraphic transfer transmitting winnings of $3,240,000 on 24 August 2019 headed “TSEG”.

9. The affidavit of 2 March 2021 annexed a photocopy of 3 cheques produced in answer to a Notice to Produce directed to SEGL that on the face of them are “winnings” from “The Star”.

10. SEGL relied upon an affidavit of Ms Saville, the partner with conduct of the proceedings. That affidavit annexed an ASIC search of the corporate entities affiliated with Star Casino, (of which there are many), the casino licence issued to the putative second defendant and various correspondence.

Factual background

11. According to Mr Su, he had in the past gambled on a number of occasions at the Star Casino and had been issued with a letter on SEGL letterhead to confirm his winnings at the Star Casino. A cheque and telegraphic transfer of the winnings then followed a few days later.

12. Mr Su claims that he won the following money (in Australian dollars) playing Baccarat at the Casino in January 2020: on 15 to 16 January, $3,188,500; on 18 January, $4,070,500 and on 19 to 20 January, $3,590,000, and on 20 January, $3,000,000.

13. Mr Su says that he was issued with written and signed acknowledgements from SEGL that confirmed the winnings. Three of these letters all dated 20 January 2020, were signed by a Ben Huang, described in the letter as “Cash Services HD Duty Manager, The Star Sydney” with a phone number provided and the letterhead “The Star” in the top left corner.

14. The fourth letter is dated 22 January 2020 and is headed “Confirmation of Winnings” and was signed by “Queenie Lau, Cash Services Supervisor” at “The Star Sydney”. That letter, at least the copy in the court book, as well as The Star insignia in the top left, has in the bottom left corner, “The Star Entertainment Group Ltd” followed by the ABN 85 149 629 023.

15. On the strength of these letters, the solicitor for the plaintiff forwarded a letter to “The Proper Officer” at SEGL on 27 July 2020, claiming the winnings, enclosing the four letters and advising that proceedings will be commenced if the winnings are not paid.

16. In a letter dated 3 August 2020, Oliver Wight, General Counsel at SEGL forwarded a letter to the solicitor for the plaintiff rejecting the position set out in the July letter and stating that the “winnings letters”, which he described as the “rated winnings letters”, are “not evidence of amounts owed by The Star Sydney or the Casino to Mr Su. All those letters accomplish is to confirm relevant rated winnings as observed by Casino staff during the course of play”. He explained that “only the exchange of gaming chips will determine the outcome of the rebate program play, not the rated winnings”. The letter goes on to explain that the “gaming chips need to be exchanged at the cage or cashier window for cash or a cheque”.

17. The letter also asserts that Mr Su was:

“… a participant on junket rebate programs with a third party junket operator. On a junket rebate program, the casino’s relationship is with the relevant junket operator and not directly with the junket participants. The junket operator (or a designated representative on behalf of the junket operator) exchanges the gaming chips with the casino and receives any payment due in exchange for the gaming chips after play has ended. Mr Su, as a junket participant, receives gaming chips from, and returns gaming chips at the end of the play to, the junket operator (or the designated representative). Mr Su’s relationship is with the relevant junket operator and not with the casino.

According to the casino’s records, it settled the relevant junket rebate programs on which Mr Su participated as a junket participant (and in respect of which the Rated Winnings Letters were issued) with the relevant junket operator in accordance with their terms”.

18. The initiating Statement of Claim was filed on 13 August 2020.

19. King Wood Mallesons, apparently retained by SEGL (but also instructing Mr Wong of counsel today in respect of the putative second defendant), in response to the Statement of Claim, forwarded a letter to Mr Su’s solicitors on 11 September 2020. It was asserted under the heading “Wrong Defendant” that, as a “threshold matter”, SEGL does not operate the Casino known as the Star. The Casino operator licensed under the Casino Control Act1992 (NSW) is The Star Pty Limited, a wholly owned subsidiary of SEGL. The letter goes on to assert that on that basis, SEGL is not the proper defendant in the proceedings and the claim against SEGL is liable to be summarily dismissed.

20. The letter goes on to suggest that the proceedings should be discontinued and that SEGL will consent to a discontinuance, provided that Mr Su pays SEGL’s costs.

21. What follows in that letter is a request for particulars such as would normally be sent in proceedings where a party was preparing to file a Defence. Some of the issues raised in those requests have in effect been answered by evidence relied on by Mr Su in this notice of motion and the further material facts set out in the proposed amended statement of claim.

22. A Defence was filed on 15 September 2020. The Defence denies liability, denies that the Casino known as The Star is owned or operated by SEGL and says that the operator of the Casino known as The Star is “The Star Pty Limited”, described as a “wholly owned subsidiary of the defendant”.

23. An application to amend the Statement of Claim was filed on 17 December 2020, and there was a further iteration of the Statement of Claim at that time, superseded by the current version.

Principles and statutory framework

24. The power to grant leave to amend is discretionary. Section 64 of the Civil Procedure Act 2005 (NSW) provides:

64   Amendment of documents generally

(1)  At any stage of proceedings, the court may order—

(a)  that any document in the proceedings be amended, or

(b)  that leave be granted to a party to amend any document in the proceedings.

(2) Subject to section 58, all necessary amendments are to be made for the purpose of determining the real questions raised by or otherwise depending on the proceedings, correcting any defect or error in the proceedings and avoiding multiplicity of proceedings.

(3)  An order under this section may be made even if the amendment would have the effect of adding or substituting a cause of action that has arisen after the commencement of the proceedings but, in that case, the date of commencement of the proceedings, in relation to that cause of action, is, subject to section 65, taken to be the date on which the amendment is made.

…

25. The Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”) also makes provision for amendment in rr 14.17 and 19.1:

14.17   New matter may be raised in pleading

A party may plead any matter even if the matter has arisen after the commencement of the proceedings.

19.1   Amending a statement of claim

(1)  A plaintiff may, without leave, amend a statement of claim once within 28 days after the date on which it was filed, but, unless the court otherwise orders, may not amend it after a date has been fixed for trial.

(2)  If a plaintiff amends his or her statement of claim under subrule (1) after the defendant has filed a defence, the defendant may amend his or her defence at any time within 14 days after service of the amended statement of claim.

(3)  A plaintiff’s right to make an amendment under subrule (1) is not affected by any amendment the plaintiff has made under rule 7.22.”

26. Leave to amend should be granted if the application is made in a timely manner and for a proper purpose: Aon Risk Services Limited v Australian National University (2009) 239 CLR 175 [2009] HCA 27.

27. The proposed amendment must be proper as to both substance and form and not liable to be struck out.

28. The amendment must not cause undue prejudice to the other party in the sense of consequence of the time and manner of the amendment, rather than the merits or otherwise of the matter(s) sought to be raised: Duke Group Ltd v Arthur Young (No 2) 1991 55 SASR 24.

29. The overriding purpose of the Civil Procedure Act, and the rules of Court (s 56), the objects of case management (s 57), as well as the dictates of justice (s 58), must all be considered when deciding whether to allow the amendment(s) sought.

30. Just, quick and cheap resolution of the real issues in dispute is not an illusory or aspirational statement and I must do what I can to make that a reality in the way I exercise my discretion in respect of this application.

31. The dictates of justice require weight to be given to the competing considerations of justice between the parties and the efficiency of judicial administration. As made clear in Aon Risk Services Limited v Australian National University (2009) 239 CLR 175 [2009] HCA 27 at [24] and [92] to [97], I must take into account the proper management and operation of the Court lists and the general desirability of efficiency in the conduct of the litigation.

Submissions

32. Mr Gray submitted on behalf of the plaintiff that the proceedings are at a formative stage, no evidence has yet been served and the only step taken by SEGL is to file a defence. It is currently unclear with whom the contract exists – with either proposed defendants, or both.

33. Mr Wong on behalf of the defendant submitted that given the licensing arrangements under the Casino Control Act, Mr Su’s contract to gamble can only have been a contract with The Star Pty Limited. SEGL did not and has never “operated” the Casino known as “The Star”; the Casino is operated by The Star Pty Limited. The basis for the allegations that SEGL is the “agent” of The Star Pty Limited is not pleaded or explained. Mr Wong submitted that there are no valid reasons as to why Mr Su maintains his case against SEGL and the case against SEGL should not have been certified by Mr Su’s solicitors as having reasonable prospects of success based on provable facts and a reasonably arguable view of the law.

34. Mr Wong took the position that the amended statement of claim should not be permitted to be filed whilst SEGL remains a nominated party.

Decision

35. It is very early days in this cause of action. Mr Su’s legal representatives have responded quickly and responsibly to issues raised by SEGL in its correspondence and has acted without delay.

36. It is understandable that those who act for Mr Su hold some reservations as to what they are being told about who is “licensed” to contract to gamble given what the “winnings letters” and the 2019 telegraphic transfer on their face show – that is that SEGL has some role in paying and/or acknowledging the winnings.

37. I do not agree that there has been “multiple wasted statements of claim” and that Mr Su’s lawyers have acted inconsistently with the requirements of s 56 of the Civil Procedure Act. There has been one abandoned iteration. Any “waste” associated with that can be dealt with by a costs order.

38. There is at this stage a level of opacity and ambiguity as to the corporate responsibilities and entities that operate the Star Casino. There is even wider potential ambiguity as to what comprises the relevant gambling “contracts”. That much is clear from the documents annexed to Mr Junn’s affidavits. It is worth observing that Mr Wight in his letter of 3 August 2020 does not refer to any corporate entities, but instead refers to the generic “the casino” and “the Star Sydney”.

39. It may ultimately be held to be inconclusive or not determinative of the issues at trial that letters were provided on SEGL letterhead confirming “winnings”, but this does not mean that Mr Su should be prevented on a pre-emptory basis, from making the allegations he does against SEGL. The “real issues” include the uncertainty regarding the corporate entities with which Mr Su gambled and the corporate entities that pay or should pay his winnings if there were in fact any to be paid.

40. His pleading is not confined to which entity “operated” or was “licensed” to provide gambling services in some strictly confined legalistic sense. His pleading is wider than that. The proposed amended statement of claim asserts facts he says are material to the position he wishes to advance against both defendants, because the indicia of responsibility and control – or “operation” – are mixed and unclear.

41. His assertions are not baseless, although they may need refinement as more becomes known by deployment of the usual available court processes.

42. Nothing tendered on this application by SEGL explains why letters confirming whatever it is that they confirm about “winnings” were provided to Mr Su on SEGL letterhead. Nothing has been volunteered in submissions to explain this and nor does it have to be, but in the absence of any such explanation, it is reasonable for Mr Su to leave SEGL as a party to the proceedings at this stage.

Orders

43. The plaintiff has leave to file and rely upon the Amended Statement of Claim in the form annexed to his Amended Notice of Motion filed 2 March 2021.

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Decision last updated: 22 March 2021