In the matter of Treadtel International Pty Ltd (No 2)

Treadtel International Pty Ltd (No 2) involved the plaintiff, Mr. Steven Treadwell, who sought leave to amend his statement of claim to pursue relief under section 233 of the Corporations Act 2001. The plaintiff alleged that the second defendant held a share in the first defendant on trust for him, and sought to amend his statement of claim to assert his standing to sue on this basis. The primary legal issue was whether the plaintiff had standing to sue, given that he was not recorded as a member of the first defendant in its register of members. The court had to determine if the plaintiff could establish an alternative basis for standing, such as being a beneficiary of a trust concerning the shares held by the second defendant.

The Federal Court considered the principles governing applications for leave to amend pleadings, focusing on whether the plaintiff had an arguable case for standing. The court found that it was arguable that the plaintiff had standing to sue as a beneficiary of a trust in respect of the share held by the second defendant. Additionally, the second defendant had a conflict of interest and was unwilling to sue, which contributed to the exceptional circumstances justifying the amendment. The court concluded that the plaintiff's application was not too late and was not a result of a tactical decision but rather a response to the defences raised. The court granted leave to amend, subject to certain conditions.

The court imposed several conditions on the grant of leave to amend. The plaintiff was required to pay the costs occasioned by the amendment, including costs thrown away, and to discontinue related proceedings in Italy permanently. Additionally, the plaintiff had to pay the defendant’s costs of the Italian proceedings. The court did not order the plaintiff to pay additional security for costs. This decision underscored the importance of the timing and strategic considerations in applications for leave to amend, while also highlighting the court’s willingness to allow amendments in the interest of justice under certain circumstances.