J.L. Holdings v The State of Queensland

[1995] FCA 899

CATCHWORDS

PRACTICE AND PROCEDURE - defence - leave to amend defence - complex issues of law and fact raised - amendments may involve joinder of further parties - prejudice to applicant

Land Act 1962 s 343(1), 345, 355

JL Holdings Pty Ltd v The State of Queensland and Anor
No SG1 of 1994

Kiefel J  Brisbane 3 November 1995

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION  No. SG 1 of 1994
BETWEEN:

J L HOLDINGS PTY LTD

Applicant

AND:

THE STATE OF QUEENSLAND

First Respondent

AND:

SOUTH BANK CORPORATION

Second Respondent

JUDGE MAKING ORDER:    Kiefel J.

DATE OF ORDER:                 3 November 1995

WHERE MADE:  Brisbane

MINUTES OF ORDERS

THE COURT ORDERS THAT:

NOTE:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION  No. SG 1 of 1994

BETWEEN:

J.L. HOLDINGS PTY LTD

Applicant

AND:

THE STATE OF QUEENSLAND

First Respondent

AND:

SOUTH BANK CORPORATION

Second Respondent

CORAM:Kiefel J.

DATE:3 November 1995

PLACE:Brisbane

REASONS FOR JUDGMENT

The respondents seek leave to amend their defence in three respects:

1. by adding an allegation that there was no valid application for a lease to be approved under s.343 Land Act 1962 (Qld);

2. by adding an allegation that the applicant altered or abandoned its proposal;

3. by pleading an indemnity given by s.355 Land Act with respect to the acts of the Minister in good faith and pursuant to that legislation.

It is the first of these amendments which has caused me some concern and this arises because of the potential for prejudice to the applicant.  The allegation is that a particular of the application for approval required by s.343(1) of the Land Act, namely the purpose to which the rent to be paid was to be applied, was not provided.  The effect then contended for is that there was then no application to which either approval or later endorsement by the Minister could be given, the latter point arising because of the terms of s.345.  The first impression one has of this new allegation is that it is somewhat technical and from what I know of the facts at present it seems the parties acted upon the basis that a lease may be approved and that it was approved.  The central issue in the action to date has been concerned with the Minister's refusal to endorse approval, an act said by the respondents to be distinct from and additional to approval itself. 

The respondents have, since 27 June 1994, when they filed their amended defence pursuant to leave granted by Cooper J. (and which was intended to clarify what was and was not in issue) maintained a non-admission in the pleading to the allegation of approval in fact.  They made it plain however in later submissions that it was not to be a live issue and could not, in the face of documentation, be so.  It is not suggested that there is any impropriety on the part of the respondents in seeking to raise the matter now, although the lack of explanation for it is pointed to.  Mr Morrison QC for the respondents explains, by reference to his instructing solicitor's affidavit, that a different view of the legal position now prevails.  This background and explanation does not furnish strong ground for leave at a late stage of proceedings, disclosing as it does only a change of mind.  It is difficult to infer that the point is essential to the respondent's case and indeed
that view has obviously not been held for some time.  At most it furnishes an additional area for argument, which is not inextricably linked with the respondent's case otherwise and the facts upon which it depends.  And it is an argument which would likely be met with cross-allegations relying on the respondent's conduct as disentitling them to raise the point.  If it raised only matters which could be dealt with in legal argument, I would have little difficulty with it.  But, it seems to me, it has the potential to require a substantial plea to it by way of reply and it may involve the joinder of another party which would delay the hearing of this matter.  The applicant may be required to address, by way of reply, whether the first respondent can be estopped from raising this plea having regard to its conduct at the time.  Whilst much of what the first respondent and its officers have done in connection with the applicant's proposal and lease has been the subject of extensive pleading, the applicant would need to specify which of it was relied upon in this respect.  By itself the matter may raise fairly complex issues of fact and law.  The party which may need to be joined is the Brisbane City Council.  It was that local Authority, and not the applicant, who furnished the information required by s.343 and it was that Authority who stood in the relationship of potential lessor to the applicant, as trustee of the land in question.  The applicant says it would wish, if leave to amend was granted, to claim damages for negligence against the Council and it has not been suggested that such a course is not, as a matter of law, open to it.  It was submitted by the applicant that it would now be statute barred from bringing such a claim but I am not persuaded this is correct, since it assumes that damage was occasioned when the information was first furnished and when it seems to me there was nothing to prevent it being supplemented or indeed a fresh application being made.  Rather the question of leave seems to me to depend upon the effect of the likely joinder of another party at this point.  The respondents filed their first defence on 23 May 1994.  There have been a number of directions hearings since then and interlocutory motions with respect to the applicant's statement of claim and with respect to discovery said to be necessary to conclude the pleadings.  One of those applications squarely raised the issue as to approval the subject of a non-admission and whilst, for the purpose of that application, the respondents were held to that non-admission, there was no suggestion then that this point would be raised and the submissions by Counsel were to the effect that it would not remain as an issue, although steps were not taken then and there to achieve that result. 

The pleadings are now at the stage where they are subject to final review, a process largely now complete and to be concluded in the New Year when damages can be fully particularised.  Discovery is complete.  Some witness statements have already been delivered and expert statements will be in the next month or so.  If a further party is joined many months may be lost in the process of pleadings and discovery, even taking into account the time necessary to conclude the existing pleadings.  By early in the New Year the proceedings will be substantially ready for hearing and a joinder would postpone that as the matter would not in the normal course be considered for the allocation of hearing dates until it reaches that state of preparedness overall.  In these circumstances, and having regard to the delay in raising the point, I consider it would be unfair to the applicant to delay its hearing.  I therefore refuse leave to amend to raise this allegation. 

The balance of the matters sought to be raised by amendment do not however have the same effect on the proceedings.  Whether the applicant altered or abandoned its proposal is more a matter of argument upon documents which are likely in any event to be tendered in evidence.  And, whilst reliance upon any indemnity provided by s.355 ought to have been promptly pleaded, the question as to whether the Minister acted in good faith, which is central to it, has already been raised on the pleadings.  Insofar as the respondents may carry the onus of establishing good faith they have undertaken to furnish further particulars of it.  I would grant leave to the respondents to amend their defence to raise their plea.

Counsel for the applicant might prepare Minutes of Order.

I certify that this and the preceding four pages are a true copy of the reasons for judgment herein of the Honourable Justice Kiefel.

Associate

Date:3 November 1995

Counsel for the applicant:  Mr T Gray QC and Mr T Matthews

Solicitors for the applicant:  Minter Ellison Baker O'Loughlin

Counsel for the respondents:  Mr P Morrison QC

Solicitors for the respondents:                  Crown Solicitor

Date of Hearing:  31 October 1995

Place of Hearing:  Brisbane

Date of Judgment:  3 November 1995