Jeffrey v Witherow - [2006] WASCA 4

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE COURT OF APPEAL (WA)

CITATION: JEFFREY -v- WITHEROW & ANOR [2006] WASCA 4

CORAM: STEYTLER P
MCLURE JA

HEARD: 10 NOVEMBER 2005

DELIVERED : 20 JANUARY 2006

FILE NO/S: CACV 143 of 2005

BETWEEN: JENNIFER ROSE JEFFREY
Appellant
AND
GREG WITHEROW
First Respondent
GEORGE CARTER
Second Respondent

ON APPEAL FROM:
Jurisdiction              :  DISTRICT COURT OF WESTERN AUSTRALIA
Coram  :FENBURY DCJ
File No  :CIV 2750 of 2002

Catchwords:

Practice and procedure - Application to amend pleading close to trial - Balance of justice favoured applicant - Scope and effect of O 20 r 2(2) and (3) - Applicability of Weldon and Neal principle

Legislation:

Rules of the Supreme Court (Vic), O 3 r 1, O 20 r 2

Rules of the Supreme Court (WA), O 20 r 2(2), (3), O 6 r 1, O 21 r 5(2), (5)
Rules of the Supreme Court 1964 (UK), O 20 r 4

Rules of the Supreme Court 1965 (UK), O 28 r 15(2)

Result:

Leave to appeal granted
Appeal allowed
Notice of Contention dismissed

Category: A

Representation:

Counsel:

Appellant:     Mr K J Bradford
First Respondent           :     Mr D Wallace
Second Respondent       :     Mr P D Quinlan

Solicitors:

Appellant:     Bradford & Co
First Respondent           :     Jarman McKenna
Second Respondent       :     Clayton Utz

Case(s) referred to in judgment(s):

Cargill v Bower (1878) 10 Ch D 502
Cellular Clothing Co Ltd v G White & Co Ltd (1952) 70 RPC 9
Commonwealth of Australia v Verwayen (1990) 170 CLR 394
Hall v Meyrick [1957] 2 QB 455
Harries v Ashford [1950] 1 All ER 427
Lewis v Durnford (1907) 24 TLR 64
Morgan v Banning (1999) 20 WAR 474
Renowden v McMullin (1970) 123 CLR 584
Tristram v Hyundai Automotive Distributors Australia Pty Ltd [2005] WASCA 168
Weldon v Neal [1887] 19 QBD 394
Wiltrading (WA) Pty Ltd v Lumley General Insurance Ltd (2005) 30 WAR 290

Case(s) also cited:

Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170
BHP Iron Ore Pty Ltd v Westraint Resources Pty Ltd [2002] WASCA 18
Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541
Clough & Rogers v Frog (1974) 48 ALJR 481
Cropper v Smith (1884) 26 Ch D 700
Decor Corp Pty Ltd v Dart Industries Inc (1991) 33 FCR 397
Ex parte Bucknell (1936) 56 CLR 221
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125
Grljusich & Anor v Grljusich, unreported; SCt of WA; Library No 930253; 6 May 1993
Hall Chadwick Corporation Finance (WA) Pty Ltd v Axiom Properties Ltd [2002] WASC 179
Johnson Tiles Pty Ltd v Esso Australia Ltd (2000) 104 FCR 564
Karsales (Harrow) Ltd v Wallis [1956] 2 ALL ER 866
Ketteman v Hansel Properties Ltd [1987] AC 189
Lever Brothers Ltd v Bell [1931] 1 KB 557
Rogers v Whitaker (1992) 175 CLR 479
Sali v SPC Ltd (1993) 67 ALJR 841
Selangor United Rubber Estates Ltd v Cradock [1965] Ch 896
State of Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146
Thackeray v Hardcastle (1999) 21 SR (WA) 337
Tony Sadler Pty Ltd v McLeod Nominees Pty Ltd (1994) 13 WAR 323
Tremeer v City of Stirling [2002] WASCA 281
Western Australia v Bond Corporation Holdings Ltd (1991) 5 WAR 40
Wilson v Metaxas [1989] WAR 285

STEYTLER P: I have had the advantage of reading, in draft, the judgment of McLure JA. I agree with it. There is nothing I wish to add.
MCLURE JA: The appellant sought leave to appeal and to appeal from the decision of Fenbury DCJ made on 4 November 2005 refusing her application to amend her statement of claim in a medical negligence action against the first and second respondents, both of whom are orthopaedic surgeons. This Court heard the application on 10 November 2005. The hearing was expedited because the trial of action was listed for 14‑18 November 2005. The application was successful and at the conclusion of the hearing, this Court granted leave to amend the statement of claim. These are my reasons for joining in the decision.
The background is taken from the appellant's pleading. She suffered pain in both feet associated with rheumatoid arthritis. In November 1996, the first respondent conducted, inter alia, a bilateral fusion of the metatarsal phalangeal joint of the big toe on both feet ("first surgery"). The appellant continued to suffer ongoing bilateral feet pain following the first surgery. In September 1997, the first respondent performed, inter alia, what is described as a revision bilateral metatarsal phalangeal fusion ("second surgery"). As a result of continuing foot pain, the appellant consulted the second respondent. In June 1998, the second respondent removed screws inserted during the second surgery and performed a forefoot excision arthroplasty ("third surgery").
All of the surgery was unsuccessful. Subsequently the appellant's fourth toe on her right foot was amputated. Amputation of further toes remains a possibility.
The appellant's pleaded case against the first respondent was of a negligent failure to warn of the risk of failure of the first and second surgery and to advise of "reasonable and viable alternatives". The appellant also claims against the first respondent that he was negligent in his post‑operative examination and review. The claim against the second respondent was of a negligent failure to warn of the risks of the third surgery and a failure to advise of reasonable and viable alternatives to it.
The proposed amendment pursued before this Court related to the angulation of the appellant's big toe on each foot away from the midline towards the other toes, called a "hallux valgus". The appellant wished to contend that prior to and after the first and second surgery, the angulation of her big toes away from the midline was such as to require the first

respondent to measure and surgically correct it and to advise her accordingly.

The proposed claim against the second respondent is that he breached his duty to advise the appellant that correction of the hallux valgus was a reasonable and viable alternative treatment. However, the appellant claims the second respondent is responsible for her disabilities which include "[p]ressure on the toes adjacent to the great toe caused by the hallux valgus and resulting in disfigurement of the lateral toes". The clear implication is that the appellant would have accepted advice from the second respondent as to the correction of the hallux valgus.
I turn now to the history of the action. In 2002, the appellant retained a firm of solicitors, Bradford & Co, to advise her in relation to the unsuccessful surgical procedures carried out by the first and second respondent. Bradford & Co still represent the appellant. At some stage, they obtained an expert medical opinion from Mr G Slater, who advised on the basis of papers provided by the solicitors. Mr Slater is in the Eastern States and did not at any stage see the appellant.
The writ was issued in October 2002, the statement of claim filed in February 2004 and the action entered for trial on 21 May 2004. Sometime before July 2005, the solicitor then handling the matter for the appellant sought further expert advice from an orthopaedic surgeon practising in Perth, Mr D Williams. He provided a written report dated 17 October 2005. His report provides ample support for the proposed amendments. Its states that current x‑rays showed a hallux valgus angle of 48 degrees for the right big toe and a hallux valgus angle of 41 degrees for the left big toe. According to Dr Williams, the big toes should be fused with virtually straight alignment or a modest 10-15 degrees of hallux valgus. Further, in his opinion the best choice in management after the surgery by the first respondent was to obtain an appropriate alignment of the big toes.
A status conference was held on 12 October 2005. The appellant was represented at that conference by Mr Bradford, the sole principal of the law firm representing the appellant. By this stage, the solicitor who had briefed Dr Williams had left Mr Bradford's employ and an articled clerk had taken over her role. At the time of the status conference, Mr Bradford did not know that Mr Williams had been asked to advise on liability, causation and quantum.
On 19 October 2005 the appellant's solicitors notified the respondents' solicitors of the proposed amendments to the statement of claim to which the latter objected. On 25 October 2005 the appellant filed a chamber summons seeking leave to amend the statement of claim which was heard by Fenbury DCJ on 3 November 2005 and dismissed on 4 November 2005. The Judge provided oral reasons for his decision and a transcript of his remarks was not available at the time of the hearing before this Court. The second respondent had contended that the proposed amendments were statute‑barred, a submission that did not find favour with the Judge. In a notice of contention before this Court, the second respondent sought to uphold the decision on the ground that the proposed amendments raised a new cause of action that arose outside the relevant limitation period contrary to the rule in Weldon v Neal[1887] 19 QBD 394.

Amendment principles

The appellant was challenging an interlocutory order concerned with practice and procedure. Steytler P recently stated the relevant principles in Wiltrading (WA) Pty Ltd v Lumley General Insurance Ltd (2005) 30 WAR 290 at [27] as follows:
"… subject to the District Court Rules 1966 (WA) (including O 1 r 3(b) which provides that, unless the justice of the case otherwise requires, the Court will refuse an application made subsequent to the pre-trial conference for leave to amend pleadings which, if granted, would necessitate an adjournment of the trial), a trial Judge has a wide discretion on such questions as that of whether or not to grant an amendment … and it is 'appropriate that appellate courts should pay more than lip service to the primacy of the trial judge' in respect of them … It is not for an appellate court to interfere merely because it would have decided the matter differently. … Moreover, special restraint must be exercised when the interlocutory order challenged is one concerned with practice and procedure …"
Of particular significance in this case was that the respondents were unable to state to the Judge or to this Court that the grant of leave to amend would necessitate an adjournment of the trial. The most that could be said was that it may do so.
The first respondent's opposition to the application was not based on, or supported by, evidence of any particular prejudice. The second respondent relied on evidence of Mr E Panetta, a solicitor of the law firm acting for the second respondent. Mr Panetta deposed that the second respondent would be prejudiced because the appellant had lost or destroyed the relevant x-rays of her feet at the time of the surgery in 1996, 1997 and 1998, which prevented the full investigation of the nature and extent of the hallux valgus at the time of the consultation with the second respondent. There are a number of points to be made on that subject. First, and most importantly, it was accepted that the radiological films were not available at the time of commencement of the action. Accordingly, the delay in raising the issue is not the cause of any relevant prejudice. Secondly, there is contemporaneous documentary evidence on the subject. There is a radiological report of an x‑ray dated 9 June 1998 addressed to the second respondent that confirms a hallux valgus albeit not its degree. That matter is also the subject of a letter dated 25 October 1996 from the first respondent to an immunologist in which the first respondent records that the appellant's "great toe has a significant valgus deformity" and that the appellant requires "a fusion of the first metatarsophalangeal joint of her great toe to correct her hallux valgus".
It can be accepted that the second respondent requires further evidence from his experts, Mr Wren and Mr Hill. Indeed, the substance of their expert reports on the current pleadings were not filed and served until 6 and 18 October 2005, well after the action had been entered for trial. Mr Panetta deposes to the fact that on 19 and 24 October 2005 he provided relevant information to the second respondent's experts and requested a further report dealing with the foreshadowed amendments as a matter of urgency and at their earliest convenience respectively. At the time Mr Panetta swore his affidavit on 1 November 2005 he had had no response from either expert. There was no further information on this subject before the Judge or this Court. There was no evidence that the respondents' solicitors otherwise sought advice from the experts or their clients to enable them to assess whether an adjournment of the trial would be required.
The appellant's counsel deposed to the substance of the Judge's oral reasons for dismissing the application. It seems he relied on two matters, namely the unavailability of the x‑ray films obtained in 1996, 1997 and 1998 and the need for the appellant to be examined by the respondents' experts. These factors do not individually or collectively justify the refusal of leave. The delay in raising the claim did not occasion any prejudice resulting from the loss of the x‑ray film. Further, the need for the respondents' experts to examine the appellant, who made it clear she was available on short notice for such purpose, is of no significance unless it supports an inference that the trial dates would have to be vacated. The parties themselves were not in a position to advance a submission that an adjournment would be required and had not put themselves in a position to make a judgement on that subject (or sought an adjournment to enable them to do so). The respondents were in the best position to assess whether an adjournment would be required and, if so, to provide an adequate explanation and justification for that course. If there were impediments apart from the availability of the experts, it is to be expected that the respondents could provide instructions as to the impediments. Indeed, they could assist the solicitors to ascertain what they needed to know to meet the proposed amendments. Further, the new issue appears on the papers to be relatively narrow and confined. In those circumstances, an inference that the trial would have to be adjourned was not justified.
If the Court could properly be satisfied that the amendment would necessitate an adjournment then issues relating to the prejudice resulting from delay would need to be weighed in the balance. As the Court could not be so satisfied, delay can be put aside.
Based on the limited material before the Court, the proposed amendment prima facie adds significantly to the strength of the appellant's case. Further, the appellant, by her solicitors, provided an explanation for the delay in raising the issue the subject of the proposed amendments. The evidence discloses that the appellant's solicitors left themselves open to criticism in the conduct of the action but not so as to significantly affect the determination of where the justice of the case lay. On the material before the Judge and this Court, the justice of the case required that the appellant be given leave to amend her statement of claim.

Notice of contention

The limitation point was only pursued by the second respondent. Counsel for the second respondent conceded, correctly in my view, that the appellant's indorsement of claim on the writ was wide enough to encompass the proposed amendments. The indorsement is in terms:
"The plaintiff claims damages, interest and costs for personal injuries suffered by the plaintiff as a result of breach of duty and/or negligence and/or breach of contract by the first defendant and/or the second defendant … in relation to treatment the plaintiff underwent during the period 11 October 1996 to 10 June 1998."
The second respondent contended that the statement of claim had narrowed the ambit of the indorsement so as to correspond with the ambit of the statement of claim. He relied on Renowden v McMullin (1970) 123 CLR 584 for that submission. In that case, the plaintiff brought an action for damages against the defendants, members of a firm of accountants, who audited the plaintiff's books of account. The writ bore a general indorsement alleging breach of contract and breach of a duty of care. A statement of claim was subsequently delivered which made no claim based on breach of contract. More than six years after the events alleged to have given rise to the claims in question, the plaintiff sought leave to amend the statement of claim to include breach of contract. A majority (Kitto, Menzies and Owen JJ; Barwick CJ and McTiernan J dissenting) held that the causes of action on which a plaintiff relied were to be ascertained exclusively by reference to the statement of claim without regard to the indorsement on the writ. As the proposed amendments sought to raise a cause of action not mentioned in the statement of claim and which was statute‑barred, the amendment was not allowed. The decision of the majority was based on O 3 r 1 and O 20 r 2 of the Rules of the Supreme Court (Vic) ("Victorian Rules"). Order 3 r 1 of the Victorian Rules is similar to O 6 r 1 of the Rules of the Supreme Court (WA) ("WA Rules"). However, O 20 r 2 of the Victorian Rules is materially different from the Western Australian equivalent. Order 20 r 2 of the Victorian Rules provided:
"Whenever a statement of claim is delivered the plaintiff may therein alter, modify, or extend his claim without any amendment to the indorsement of the writ."
Order 20 r 2(2) and (3) of the WA Rules provide:
"(2)A Statement of Claim must not contain any allegation or claim in respect of a cause of action unless that cause of action is mentioned in the writ or arises from facts which are the same as, or include or form part of, facts giving rise to a cause of action so mentioned.
(3)Subject to paragraph (2) a plaintiff may in his Statement of Claim alter, modify or extend any claim made by him in the indorsement of the writ without amending the indorsement."
Unlike the Victorian Rule, O 20 r 2(2) and (3) of the WA Rules requires the statement of claim to have a relevant connection with the causes of action in the indorsement. The scope and effect of O 20 r 2 was considered in Tristram v Hyundai Automotive Distributors Australia Pty Ltd [2005] WASCA 168.
Owen J (with whom Kitto and Menzies JJ agreed) concluded (at p 608) that in light of O 20 r 2 of the Victorian Rules and a number of authorities to which he referred, it was only the statement of claim to which regard should be had in determining whether the new claim was statute‑barred.
The authorities to which Owen J referred include Cargill v Bower (1878) 10 Ch D 502, Lewis v Durnford (1907) 24 TLR 64, Harries v Ashford [1950] 1 All ER 427, Cellular Clothing Co Ltd v G White & Co Ltd (1952) 70 RPC 9 and Hall v Meyrick [1957] 2 QB 455. In Cargill v Bower the plaintiff indorsed in his writ a claim for rescission of a contract for shares and indemnity against future liability arising under it. Before filing his statement of claim in the action, the plaintiff appeared as a contributory on the hearing of a winding up petition of the company in which he held the shares. Later he filed his statement of claim in which he dropped all claim for relief in the nature of rescission of the contract and only sought relief in the nature of an indemnity. Afterwards, an application was made in the winding up to put the plaintiff on the list of contributories. He resisted the application and it was ordered to stand over until the trial of the action. The plaintiff then applied to amend the statement of claim to seek rescission of the contract. Fry J said at (p 509):
"Under these circumstances I think that I ought not to give leave to amend the statement of claim. It is not necessary for me to say whether the Plaintiff has finally elected to approbate the contract, but I think that he has by his conduct at any rate expressed an intention and desire to assert his claim to rescission of the contract only in the winding‑up proceedings. I therefore refuse to give leave to amend."

It is noted by the minority in Renowden that leave to amend was refused because the plaintiff had in substance elected not to make the rescission claim in the action and that the case was decided as a matter of discretion and not by reference to the rules of court.
In Lewis v Durnford a writ was indorsed to claim liquidated damages for breach of a contract of service and an injunction to restrain the breach. The statement of claim sought only an injunction. The remedies claimed in the writ were inconsistent and the defendant argued that the claim for liquidated damages precluded the grant of an injunction. Swinfen Eady J said (at p 65):
"It was true the writ claimed both forms of remedy; but the claim endorsed thereon was superseded by the statement of claim, and under Order XX Rule 4, a plaintiff was entitled in his statement of claim to alter, modify or extend his claim without amending his writ. It has been held in 'Cargill v Bower' … that where a plaintiff in his statement of claim omits part of his claim, he will be deemed to have abandoned that part."
The minority in Renowden note that the plaintiff had elected between inconsistent remedies as he was entitled to do and that the observations on Cargill v Bower were not accurate. Order 20 r 2 of the Victorian Rules is in the same terms as the English Rules. Order 20 r 4 of the English Rules (which was in the same terms until 1964) provided:
"Whenever a statement of claim is delivered the plaintiff may therein alter, modify, or extend his claim without any amendment of the indorsement of the writ."
In Harries v Ashford the plaintiffs (W and another) in their indorsement sought damages in their capacity as purported administrators of the estate of W's deceased husband. W also claimed damages in her personal capacity under the fatal accidents legislation. In the statement of claim the plaintiffs only pursued the claim made in their capacity as administrators of the estate. Some time later, the plaintiffs applied to amend the statement of claim by substituting W's personal claim for the claim made by the plaintiffs in their capacity as administrators. The application was refused. In the lead judgment, Asquith LJ referred to Cargill v Bower and Lewis v Durnford, including the reference by Swinfen Eade J to O 20, r 4, and concluded that the proper course was not to allow the amendment.
In Cellular Clothing v White a writ was indorsed with a claim for an injunction for an infringement of a trademark and an injunction to restrain passing off. The plaintiff, believing itself not to have a case for infringement, deliberately chose to limit its statement of claim to passing off. An application to amend at a late stage in the proceedings was refused. Harman J said:
"It is very rare that one refuses leave to amend on terms, but here, as Mr Levy very candidly said, he decided, when he issued his statement of claim, to abandon infringement because he felt he had no case for it. Once abandoned, the claim remains abandoned, and it does not lie in the mouth of the plaintiff to say 'Now I should like to put it back again'. If it be as I think it probably is, a matter of discretion, I refuse leave, because the plaintiffs, having deliberately taken the course they did and announced to the world and to the defendants that the only particulars which they were going to rely upon were such and such, now sought to rely on other particulars altogether ... In my judgment, it would be quite wrong to allow an amendment of this sort under those circumstances."
In Hall v Meyrick the plaintiff pleaded in her statement of claim that she and her husband had jointly retained and employed the defendant as their solicitor to advise them in making mutual wills in contemplation of marriage. After the trial Judge had rejected the claim, he indicated that he would allow the plaintiff to amend to claim alternatively that there was a separate retainer of the defendant by the plaintiff. The defendant appealed on the ground that the trial Judge erred in granting leave to amend because it had the effect of depriving the defendant of the benefit of the statute of limitations. The Court upheld the appeal. Hodson LJ said (at p 476):
"The writ as endorsed was for damages for negligence 'and failure to use reasonable skill and diligence as solicitor for the plaintiff'; but, when the statement of claim was delivered, the form of action was made plain, and according to the provisions of Ord. 20, r. 4, in my opinion, from that moment the statement of claim, and the statement of claim only, is the document to be looked at in order to see what it was that the plaintiff was claiming."
The Court, applying Weldon v Neal, held that the plaintiff would not be allowed to amend by asserting fresh claims in respect of causes of action which, having regard to the date of the issue of the writ, were statute‑barred. Hodson LJ regarded O 20 r 4 as the basis for the conclusion that only the statement of claim was relevant to the question of amendment.
I understand the reasoning of the majority in Renowden to be as follows: the Victorian Rules (and the English Rules in the cases relied on) permitted the statement of claim to enlarge or contract the scope of the indorsement without restriction and without requiring the indorsement to be amended; the statement of claim is the only relevant document when considering a proposed amendment; and if a statement of claim omits all mention of a cause of action or claim for relief stated in the writ, it will be deemed to have been abandoned.
The minority in Renowden had a different view as to the scope and effect of O 20 r 2 of the Victorian Rules. They said (at page 595) that the alteration, modification or extension of the claim permitted pursuant to O 20 r 2 of the Victorian Rules must remain within the area marked out by the indorsement. They continued:
"The basic nature of the claim in respect of which the action has been commenced may not be changed, however much room there is under the Rules for variation in the statements of facts or the extent of the remedy or relief sought."
In around 1964, O 20 r 4 of the English Rules was replaced by O 28 r 15(2) which is in materially the same terms as O 20 r 2(2) and (3) of the WA Rules. The minority in Renowden were of the view that O 20 r 2 ought to be construed in the same way as O 28 r 15(2) of the later English Rules. The minority concluded that because the proposed amendment to the statement of claim was within the range of the indorsement, it did not involve any deprivation of the defendant's accrued right under the statute of limitations and the rule in Weldon v Neal had no application.
The minority were also of the view that the authorities relied on by the majority in Renowden did not provide a sound foundation for the rule of deemed abandonment. Indeed, the purported source of the rule, Cargill vBower, is in essence a conclusion of election, waiver or estoppel of the kind considered by the High Court in the Commonwealth of Australia v Verwayen (1990) 170 CLR 394 where the issue was whether the defendant had elected not to rely on a limitation defence or had waived the right to do so or was estopped from relying on it. See also Wiltrading at [40] – [60] per Steytler P.
Even so, this Court is bound by the decision of the majority in Renowden unless it can be distinguished. In my view it can. The deemed abandonment principle is inextricably linked with O 20 r 2 of the Victorian Rules. The WA Rules are materially different in that they require a connection between the matters pleaded in the statement of claim and the indorsement. The terms of O 20 r 2(2) and (3) are consistent with the analysis and conclusions of the dissentients Barwick CJ and McTiernan J in Renowden at pp 594 and following. So too is the Full Court analysis and decision in Morgan v Banning (1999) 20 WAR 474. Accordingly, I concluded that the proposed amendments were within the scope of the indorsement and that there had been no deemed abandonment of so much (unspecified) of the indorsement as would exclude them. In those circumstances, it is unnecessary to determine whether O 21 r 5(2) and (5) apply to the proposed amendments.
It is for these reasons I granted leave to amend the statement of claim and dismissed the notice of contention.