Lakatoi Universal Pty Ltd v La Walker

[2000] NSWSC 560

CITATION:	Lakatoi Universal Pty Ltd v LA Walker [2000] NSWSC 560
FILE NUMBER(S):	SC 50035/98
HEARING DATE(S):	13/06/00
JUDGMENT DATE:	21 June 2000
PARTIES :	Lakatoi Universal Pty Ltd & Ors v Langley Alexander Walker & Ors
JUDGMENT OF:	Einstein J

COUNSEL :	VRW Gray (Plaintiff) BR McClintock SC, R Hollo (Mr Walker) P Kerr (Walker Consolidated) RJ Powell (Remaining Defendants)
SOLICITORS:	Gye Associates (Plaintiff) Minter Ellison (Mr Walker) Allen Allen & Hemsley (Walker Consolidated) Perkes & Stone (Remaining Defendants)
CASES CITED:	Beswick v Beswick [1968] AC 58 Beocco Ltd v Alfa Laval Co Ltd [1995] QB 137 Coulton v Holcombe (1986) 16 CLR 1 Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 Vanderpitte v Preferred Accident Insurance Corporation of New York [1993] AC West v Houghton (1879) LR 4 CPD 197
DECISION:	Oral application dismissed.

THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION - COMMERCIAL LIST

EINSTEIN J

Wednesday 21 June 2000

50035/98 LAKATOI UNIVERSAL PTY LTD & ORS V LANGLEY ALEXANDER WALKER AND ORS.

JUDGMENT on the application to revisit the 1 June Judgment

Background to the 1 June 2000 judgment

1    An ex tempore Judgment was delivered in these proceedings on 1 June 2000 ["the June judgment"]. It was the fourth judgment delivered in a sequence of judgments generally explained in the first section of the June judgment. 2 The occasion for the delivery of the June judgment followed the giving of detailed submissions by Mr McClintock SC for Mr Walker on a number of issues. The issues are generally outlined in the June judgment. The submissions advanced by Mr McClintock extended to cover the assertion that the plaintiffs had never put their case on bases which were the subject of findings in the principal judgment delivered on 10 March 2000. They included a submission that the plaintiffs had never put the case on the basis found in the March judgment at paragraph 1443. They included a submission that practically speaking the plaintiff during the proceedings had abandoned any claim for damages against Mr Hogarth. Mr McClintock’s submissions included a detailed examination as to the approach taken by Mr Walker during earlier submissions and covered close questions of the manner in which the proceedings had been pleaded. 3    During the course of the submissions leading to the judgment an application was made by the plaintiffs for leave to further amend the fourth amended summons. Submissions were addressed to the Court by Mr Gray on behalf of the plaintiffs and by Mr McClintock in relation to this application. Mr Kerr, solicitor, appearing on this occasion for Walker Consolidated, opposed the application for leave to amend. Mr Powell of counsel appearing on this occasion for all defendants otherwise than Mr Walker and Walker Consolidated, also opposed the application for leave to amend. 4    The application for leave to amend was put as desirable, but not essential. The matter was put as regularizing the way in which the proceedings had been litigated as reflected in the findings in the March judgment. 5    The complex of matters raised by Mr McClintock SC in terms of the submissions as to findings in the March judgment said not to reflect the manner in which the proceedings had been litigated, submissions as to the submissions which had been advanced to the court during the proceedings proper, submissions as to the pleadings, submissions as to the reasons why Mr Walker had not taken the points now sought to be taken much earlier and submissions as to the agency and trust issues [dealt with and explained in the June judgment], meant that the June judgment covered a number of interrelated areas. It was necessary that those areas be examined so as to set the ground for an examination of both the application for leave to amend the fourth amended summons as well as to permit the substance of the matter to be dealt with.

Following the delivery of the 1 June judgment

6    At the conclusion of delivery of the June judgment Mr McClintock SC rose and submitted that he had been under the misunderstanding that the ex tempore Judgment would only deal with the application for leave to amend the summons and would not deal with the substantive issues which would arise if the application for leave to amend was granted. Mr McClintock’s submissions were transcribed. Counsel in another matter were awaiting the commencement of that matter at a time already late in the day.

Relisting on 2 June 2000

7    The matter was relisted on 2 June when I referred to the fact that after the judgment had been delivered on the previous day Mr McClintock had risen to submit that it had not occurred to him that the court would deal with the substance of the trust issue in giving its reasons, as opposed to dealing only with the application for leave to amend. I pointed out that at the time when I had delivered the judgment my view certainly was that the whole of the matter had been fully ventilated following Mr McClintock's initial advancing of detailed submissions on the orders earlier that week and then again on 11 June when Mr Gray had responded and when Mr McClintock had responded to Mr Gray. I stated that I believed that at one stage during his submissions, Mr McClintock had indicated in making a point about the trust question, that he wished to rely for his submission both in relation to the amendment and to the substantive point. I note the terms of paragraph 47 of the 1 June Judgment. I certainly had no belief that the Judgment was to be viewed as only given in relation to the application for leave to amend. 8    I then stated that because of the nature of the matter and the undesirability of even a suggestion that any party had been deprived of an opportunity to address detailed submissions on the substantive trust issue, it seemed to me appropriate that Mr McClintock be given an opportunity to place on the record any submissions that he wished to put, firstly on why those submissions should be entertained at all and secondly in terms of the detailed submissions sought to be put. I stated that the matter might then be placed in the list and Mr Gray given an opportunity, as appropriate and if appropriate, to respond. It was clear that the further submissions invited from counsel for Mr Walker were not only to cover the question of why further submissions should be entertained at all but were also to include the detailed submissions on the substantive issues sought to be put. 9    Mr McClintock made plain that it would be inappropriate for him to deal with anything beyond the points as to why submissions should be entertained at all and secondly the merits or the substance of the Beswick v Beswick [ie the trust] point. That was all that he would deal with. 10    Mr McClintock was given until 5.00pm on Wednesday 7 June 2000 to prepare and serve such submissions. The matter was relisted for Tuesday 13 June 2000.

The submissions received by 13 June 2000

11    By the time the matter came before the court at 10.00 am on 13 June 2000 submissions dated 7 June 2000 had been received from Mr McClintock SC on behalf of Mr Walker. submissions dated 13 June 2000 had also been received in response from Mr Gray representing the plaintiffs.

Mr Walker’s submissions

12    The position taken by Mr Walker in his submissions of 7 June was that it was impossible for those representing him adequately to put submissions in respect of the substantive amendment in the time available. The circumstances sought to be relied upon were said to include late notice of the amendments; the voluminous evidence admitted in the proceedings; the relatively complex issues raised by the amendments; the existing commitments of Mr Walker's legal advisers and the fact that Mr Walker’s present solicitors had filed a Notice of Change of Solicitor on 29 May 2000 due to the conflict of interest which the previous solicitors on the record had, in continuing to represent all defendants. 13    The submissions included a statement that Mr Walker sought orders directing the plaintiffs to file and serve a Fifth Amended Summons by 14 June 2000; directing the defendants to file and serve a defence to the Fifth Amended Summons by 20 June 2000; and directing that the proceedings be “listed for further hearing” at a time to be fixed by the court. The submissions included a statement that Mr Walker applied also for an order that the court withdraw the ex tempore reasons for judgment delivered on 1 June 2000. 14    The submissions did not do otherwise than assert that insofar as Mr Walker had had an opportunity to consider the recent amendments it was likely that his position would be as follows:

(1) that he will deny the allegations in the last sentence of paragraph 27 (or paragraph 27A) of the Fourth Amended Summons
(2) that he will submit that Mr Hogarth did not expressly contract as trustee for anyone in the Heads of Agreement, nor is there a term in the Heads of Agreement that the benefit of any promise of Mr Walker is to vest in trust for the Plaintiff Corporations
(3) that he will submit that absent express terms, there must be clear or in the alternative some evidence of intention (inferred or imputed) to create a trust of the promisor's promise: see, for example, Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 147 per Deane J
(4) that he will submit that there is no evidence of intention on the part of Mr Hogarth (or Mr Walker, if it be relevant) that Mr Hogarth should hold on trust the benefit of the Heads of Agreement for each of Lakatoi, Ensile and Highfield Grove and that no such intention can be gleaned from the express terms of the Heads of Agreement. [In support of the submission Mr Walker points out that by their written submissions of 1 June 2000, the plaintiffs advanced their case on the basis that Mr Hogarth (not his companies) suffered loss by reason of the found breach of the Heads of Agreement. Mr Walker's submissions here refer inter alia to Trident at 121, per Mason CJ and Wilson J].
(5) that he will submit that Mr Hogarth is not entitled to more than nominal damages (assuming there is a found breach of the Heads of Agreement)
(6) in the alternative, if, which is denied, Mr Hogarth did hold in trust the benefit of the Heads of Agreement for the named corporate plaintiffs, then he will submit that any such trust came to an end or was terminated or revoked upon the execution of the HUTA to which Lakatoi and Ensile and, later, Highfield Grove, were a party
(7) further and in the alternative, if Mr Hogarth entered into the Heads of Agreement as trustee for the corporate plaintiffs (which is denied), then he will submit that equally Mr Walker entered into the Heads of Agreement as trustee for Walker Consolidated and is entitled to be indemnified by Walker Consolidated in his capacity as trustee

15    On the occasion when the matter came before the court on 12 June 2000, Mr McClintock SC further submitted from the bar table that I should disqualify myself from further hearing any aspect of the issues which had been before the court on 1 June on the basis of a reasonable apprehension of bias. The submission was that such a recusal was warranted by reason of the June judgment having included reasons dealing with the merits of the issue raised by the amendment without argument on the substantive aspect and was also warranted by reason of the fact that the so-called 'trust point' was raised during argument by the court. The submission was that such a recusal was also warranted by reason of the authorities referred to in the June judgment which, it was submitted, went beyond the authorities referred to in argument.

The Plaintiff’s submissions

16    Mr Gray of counsel for the plaintiffs submitted in his detailed written submissions inter alia as follows:

"The amendments which, on 1 June, the Court permitted the plaintiffs to make to the summons were merely to specify the relationships between the plaintiffs inter se and, consequentially, the prayer for relief. This specification and its consequence for any award of damages was inherent in the court's findings at paragraph 341 of the reasons for judgment published 10 March 2000.” [Submissions paragraph 23 ]
"The purpose of the amendments made on 1 June was to make explicit in the pleading the way the plaintiffs put their case on damages at the trial-which case Mr Walker answered at the trial." [Submissions paragraph 29]
"The plaintiffs have throughout the litigation conducted the case on the basis that Mr Hogarth had contractual rights against Mr Walker under the Heads of Agreement but have never contended that those rights would give cumulative entitlement to damages over and above the damages which Lakatoi, Ensile and Highfield Grove actually recover for breach by Walker Consolidated for breach of its obligations under the HUTA." [Submissions paragraph 30]

17 The plaintiffs submissions also draw attention to Part 40 Rule 1 of the Supreme Court rules which the plaintiffs submit and I accept, appears to deal explicitly with the situation which arose in this case in consequence of the courts judgment. This rule provides:

"The court may, at any stage of any proceedings, on the application of any party, give such judgment or make such order as the nature of the case requires, notwithstanding that the applicant does not make a claim for relief extending to that judgment or order in any originating process"

18    Insofar as Mr Walker's submissions had claimed an entitlement to plead to the new amendment, the plaintiffs did not question that entitlement.

Dealing with the matter sought to be raised

19    I have given close consideration to the whole of the events outlined above conscious as I am of the critical necessity to ensure that each party has a proper opportunity to address before reasons for judgment on any application are handed down. That close consideration has extended, of course, to the submissions of Mr McClintock that he was caught unawares in terms of the courts intent to deliver a judgment dealing not only with the pleading question but also with the questions of substance on all matters argued. 20    At one stage during the course of his oral submissions of 1 June, Mr McClintock used the word "substantive" in dealing with the trust issue. He stated inter alia:

"Your Honour the difficulty with the trust point is this; I have to say that it had not occurred to me that it could be put on that basis in the circumstances, that’s no doubt a deficiency on my part because of course one is familiar with cases such as Beswick v Beswick and so one. In the time available I have sent for and had brought up, Ford and Lee on Trusts and paragraph 4100 deals with that kind of trust.
I was reminded, your Honour, that it is not simply a matter of contract for which a benefit is to be given to another person. I would wish to rely, your Honour [on] what was said in both respects in relation to the amendment and in relation to the substantive point to what was said by the House of Lords or Privy Council, I should say in Vandepitte vs Preferred Accident Insurance Corporation of New York [1993] AC at page 70….” [Mr McClintock then went on to refer in some detail to a section within paragraph 4100 of the text] [emphasis added]

[Transcript of 1 June page 31]

21    The argument which took place on 11 June was sound recorded. The argument was followed after a short break by a delivery of the ex tempore judgment. 22    In the written submissions put forward on behalf of Mr Walker complaint is made of the fact that in the course of the judgment which was delivered, the court referred to certain authorities which had not been mentioned by any counsel in argument. Beswick v Beswick had however been briefly referred to by Mr Gray earlier in the week when Mr McClintock first outlined his overall points. A close examination of the precise submissions advanced by Mr McClintock in relation to the trust point reveals that he referred, as earlier indicated, to the line of cases exemplified by Beswick v Beswick, to paragraph 4100 of Ford and Lee, to an extract appearing on page 9 of the text explaining Vandepitte v Preferred Accident Insurance Corporation and to a quotation from the judgment of Lord Green MR in Re Schebsman [1944] Ch 83 at 89 to the effect that it had come to be accepted that '[I]t is not legitimate to import into the contract the idea of a trust when the parties have given no indication that such was their intention’. Mr McClintock also read from the text at page 9 the statement that it became necessary for the intention to be affirmatively proved and using the text, cited as authority for that proposition, West v Houghton (1879) LR 4 CPD 197 at 203. Mr McClintock specifically referred to the finding of the Privy Council in Vandepitte being an insurance case, that there was no evidence that the father intended, when taking out the policy, to contract as trustee for his daughter. At this stage Mr McClintock was obviously reading the last section of the Vandepitte discussion to be found at page 9 within paragraph 4100 of Ford and Lee ‘Principles of the Law of Trusts’. 23 On the question of the readiness of Mr Walker's new counsel to deal with all matters going to the so-called privity point first raised on 29 May, to my mind it was incumbent upon Mr Walker's new legal representatives to be in a position to fully litigate that matter on that day and later on 1 June when the matter was to be before the court in terms of hearing further submissions. It is a not infrequent experience in commercial litigation for counsel to be obliged at reasonably short notice to deal with complex legal issues including issues which they may not have been perceived as likely to arise. Experienced counsel such as Mr McClintock are well aware of this fact. And I have no doubt but that Mr McClintock, had he been of the view that further time was needed for him to be able to research and deal with the trust point in the manner in which it arose during the argument, could and would have sought an adjournment to permit that research to be carried out. As I understand Mr McClintock's present submissions, they are to the effect [or to be read as having the effect], that he saw this as unnecessary because and only because, he believed that the court was only then dealing with the application for leave to amend. But the application for leave to amend was integrally, as it seems to me, related to the point of substance. 24 In any event, and notwithstanding my own surprise at hearing that Mr McClintock had not anticipated that the judgment to be delivered would deal with all aspects of the matter and bearing in mind the complexity of the matter generally, it seemed to me important that the court give to Mr Walker yet a further opportunity to address whatever detailed submissions could be addressed on the trust point and at the same time as producing those submissions, be permitted to address on why those more detailed submissions should be permitted to be made. In that environment it would be possible it seemed to me, for the court to be properly seized of the whole of what Mr Walker wished to suggest as submissions which could and should have been taken into account prior to the delivery of judgment on the substantive issue. In this sense the court would be able to fairly adjudicate as between the parties what should be the fate of Mr Walker's application for the interlocutory judgment or part of it to be withdrawn or revoked. [Although Mr Walker's written submissions in terms seeks a withdrawal of the June judgment, I have interpreted the application as seeking a withdrawal of only so much of that judgment as dealt with the substantive issue, it being common ground as I understand it that the sections of the judgment dealing with the application for leave to amend were expected and could remain]. 25    As would have been seen from the above chronology Mr Walker's submissions are that he did not have sufficient time even after the matter was raised on 2 June to prepare submissions on the substantive point by 5.00 pm on 7 June. That allowed a period of five and a half days for preparation of those submissions. But the matter does not end there. I infer from the fact that when the matter was before the court and listed for 'submissions' on 13 June, Mr McClintock did not seek then to indicate that submissions on the point of substance were by then available, that even by that date the proposition contended for in the written submissions of insufficient time to prepare, was still pressed. By now some ten and a half days had expired since the court on 2 June had indicated that further submissions should be presented. These matters confirm to me that in every sense Mr Walker has had a proper and sufficient opportunity to closely examine the trust point but has not seen fit to do otherwise than indicate a likely position. To my mind this is not good enough in these proceedings at this point in time and bearing in mind the chronology and bearing in mind the nature of the issue. 26    Of special importance in adjudicating upon the whole of this exercise are the matters which were so carefully and thoroughly explained in the June judgment. On a number of occasions in that judgment the court made the point that whilst it was not strictly necessary for the plaintiffs to seek or for the court to grant leave to make the subject amendments, the course of granting the leave to amend was simply taken in order to ensure that the record recorded the manner in which the parties had litigated the proceedings. A close reading the June judgment makes plain that the holding is that bearing in mind the manner in which the proceedings were actually litigated, there is now and at this stage no entitlement in any of the defendants to seek to submit that the pleadings were defective in the manner suggested in Mr McClintock's submissions. Hence the whole question of the amendment was dealt with in terms of the arguable but by no means certain, desirability of correcting the record to ensure that the formal pleading correctly reflected the manner in which the proceedings were actually litigated. This is a far cry as it seems to me from the situation which sometimes may occur in the course of contested proceedings where, during the course of the hearing, an amendment is allowed which permits the case to take a new direction. This is not what has occurred here. 27    As clearly stated in the June judgment what is being dealt with involves an actual finding in the 5 Volume March judgment. At paragraph 341 in that judgment the court inferred that the personal signatories to the Heads of Agreement signed in a representative capacity intending to generally represent their respective relevant corporate interests. If there was any substance in the contention that this finding was not open to the court on the pleadings and having regard to the manner in which the proceedings were litigated, then this is a matter to be dealt with on appeal, should there be an appeal from the judgment. And all that the June judgment did was, as a matter of more abundant caution only, to ensure that this finding was properly reflected in the pleadings. So that Mr McClintock’s submissions suggesting that an entirely new area has now arisen for examination and litigation is simply misconceived. 28    Mr Walker stood by whilst the whole of the evidence was adduced, through the whole of the submissions which predated the delivery of the March judgment, through the whole of the submissions which predated the delivery of the 25 May judgment, never once by his then legal representatives, submitting that on the pleadings, Lakatoi and Ensile not having been parties to the Heads of Agreement, could not make any claim against him for damages for breach of the best endeavours obligation owed to Mr Hogarth by Mr Walker. Mr Walker's contention that it was unnecessary for any such submission to be advanced because the pleadings did not cover such a case simply cannot stand in the light of the way in which the proceedings were litigated. 29    The way in which the parties litigated the proceedings involved a necessary acceptance by all parties:

(a) that a success by the group of plaintiffs of their claims to breaches of the best endeavours covenants in the Heads of Agreement and in the HUTA would result in an award of damages in favour of the corporate plaintiffs or some of them
(b) that the precise legal vehicle by which such an award would be made was not to be in issue

30    Hence it was simply not open to Mr Walker, following the handing down the 5 Volume March judgment and following also the handing down the May judgment, to seek to raise an entirely new point not previously litigated. 31    Had it been that the way in which the parties litigated the proceedings did not involve any such a necessary acceptance of the above described matters, then it may have been open to Mr Walker, following the handing down of the 5 Volume March judgment and following the handing down of the May judgment, to seek to raise what I have referred to as the breach of privity point. 32    There is no excuse for Mr Walker not to have raised prior to the handing down of the 5 Volume March judgment or particularly at the point in time when submissions were being taken from Mr Gray and Mr Officer QC as to the orders to be made, the. breach of privity point. The fact that Mr Walker was, when those submissions were being advanced, being represented by the same set of counsel as had represented all defendants through the proceedings, provides no excuse for Mr Walker not having sought to take this point. It was open to Mr Officer QC for example to submit that:

(a) on the pleadings it was Mr Hogarth who was the only plaintiff who could personally receive an award of damages suffered by reason of Mr Walker's breach of the Heads of Agreement
(b) Mr Hogarth had not proved that he personally had suffered any form of loss at all by reason of Mr Walker's breach of the Heads of Agreement

33    When the privity point was first sought to be taken by Mr McClintock it was entirely appropriate for Mr Walker to be held to the way in which he had litigated the proceedings. It was also appropriate for the plaintiffs to be permitted to amend so as to bring the pleadings into line with the way in which the proceedings had always been litigated. That form of amendment did not require it seems to me, any form of leave to permit the defendants to amend their defences. The approach taken by the defendants at all material times had been to litigate the proceedings on the basis that the precise legal vehicle by which an award of damages would be made in favour of the corporate plaintiffs was not in the issue. 34    On the issue of an amendment to the defences to deal with the amendments now allowed to the summons, I generally assumed for the purposes of the June judgment that the defendants sought to formally place in issue the allegations in paragraphs 27A of the amended summons. I did not and do not see it as necessary that this be achieved otherwise than notionally. Counsel who were in the proceedings during the course of the hearing proper will recall that in early March, the proceedings were relisted for the purpose of the court pointing out some other defects in the pleadings. The matter was referred to in the March judgment in paragraphs 1068-1070. On 2 March I simply dealt with the failure of the second further amended defence as filed on 17 November 1999 to plead at all to paragraph 31A of the Contentions by stating that the transcript would note that the defendants denied the allegations made in that paragraph. The same approach would seem to be the position here. On that earlier occasion also, the amendment to the pleadings was simply to correct the manner in which the proceedings had been litigated. No further submissions were taken. 35    And notwithstanding Mr Walker's written submission that "a further hearing" should now take place [ written submissions paragraph 14 (3)], the notion that such a further hearing should take place after a three-month trial and a full judgment on all matters litigated during that trial, suggests as the plaintiffs point out in their written submissions, "that Mr Walker is now seeking to depart fundamentally from the stance he has at all times hitherto taken in his defence of these proceedings”. [Plaintiffs written submissions paragraph 18] 36    The most significant principle which underpins the judgment delivered on 1 June and this judgment is the principle that the parties “must be bound by the conduct of their case at the trial” Coulton v Holcombe (1986) 16 CLR 1 at 11. 37 On the application that I recuse [that is to say permit the matter to be referred to another Judge to determine the merits of the matters raised before me on 1 June], in my view there is no substance in this application. Even had Mr Walker been prepared to put forward such submissions as he now says could and would have been relied upon on 1 June had he appreciated that the court was proposing to then deal with the substantive matter as part and parcel of the associated amendment issue, and had I as requested, seen fit to revoke so much of the 1 June judgment as went beyond the amendment issue, I would not even then have been prepared to accept the submission of reasonable apprehension of bias. These extremely close questions of what matters were litigated before me and of new representation of parties previously content to approach the case through the same representation, although seldom occurring, are part and parcel of the litigious process. The suggestion of a reasonable apprehension of bias grounded upon the proposition that a revocation of certain of the reasons in an interlocutory judgment would not permit a judge impartially to redetermine those issues after fuller argument, is rejected. And it is to be borne in mind that following Mr McClintock’s indication after the ex tempore judgment had been delivered, that he had not anticipated that more than the amendment application would be then determined, yet a further opportunity was made available by the court for the delivery of the suggested fuller submissions, but was not availed of. That invitation does not suggest it seems to me, anything like reasonable apprehension of bias, but rather the contrary. 38    In any event I have given close consideration to each of the matters set out in paragraphs 16 of Mr McClintock submissions. 39    As to the question of principle sought to be raised in paragraph 16 (3), the submission seeks to refer the court to the very same page of the judgment of Deane J in Trident which was cited in paragraph 49 of the June judgment. The proposition for which Mr Walker contends is in accordance with principle and is in accordance with the approach to principle specifically taken in the June judgment. It accords precisely with the manner in which the court treated with the question of principle in that judgment. 40    As to the matter raised in paragraph 16 (2), the June judgment is self-explanatory and dealt with this matter. But the June judgment went further and importantly dealt with the finding in the March judgment that the personal signatories to the Heads of Agreement signed in a representative capacity intending to generally represent their respective relevant corporate interests. The June judgment made the point that this finding clearly supported the proposition that Mr Hogarth held the benefit of Mr Walker's contractual covenants to use best endeavours, as trustee for those companies who were proven to be Mr Hogarth's relevant corporate interests having signed the HUTA . The June judgment made the point that the finding reflected the manner in which the proceedings were actually litigated. But there is a further matter which it also seems to me is here relevant. This is the fact that in Mr McClintock's submissions of 29 May specifically submitted [transcript page 21 line 56] that the finding as to representative capacity was correct. Hence Mr McClintock's latest submission would seem, to say the least, to seek not only to undermine this finding, but also to stand in apparent contradiction to his earlier submission. 41    As to the matter dealt with in paragraph 16 (4), the June judgment is again self-explanatory. I have reconsidered carefully the finding in paragraph 51 of the June judgment. Nothing in this paragraph of Mr McClintock’s submission would cause me to come to any different conclusions to those expressed in the June judgment. I note also that during the argument which took place on 1 June the point was made that it seemed patently clear that Mr Hogarth never intended to be a party to the joint venture when formally documented . So that there could not be a suggestion but that this area was generally raised for consideration or the subject of submissions and argument on the day. Here again, the finding in paragraph 341 of the March judgment, falls to be taken into account. 42    As to the matter dealt with in paragraph 16(5), this was the subject of address by Mr McClintock on 29 May. [The matter is to be found at transcript page 2 line 46, and is again referred to at page 16 line 20]. The whole of this suggested nominal damages issue was part and parcel of the 29 May and 1 June set of submissions by Mr McClintock, the essential approach being that Mr Hogarth had not proven that he personally had suffered any specific damage by reason of the breaches of the best endeavours covenant in the Heads of Agreement. 43    As to the matter dealt with in paragraph 16(6), Mr McClintock on 1 June in dealing with the trust point specifically referred to the proposition that any such trust would be concluded when the trust property was conveyed to the beneficiary. The submission was that if the trust approach was the correct analysis, the trust property was the benefit of the Heads of Agreement, and was conveyed when the HUTA came into existence. The submission was that this was not a matter of novation but was a termination of a trust to do a particular thing like a performance of the trust. Hence this matter was also referred to during the submissions. The proposition put forward by Mr McClintock is not one of substance. No basis is put forward to support the proposition. Mr Hogarth continued to hold the benefit of the Heads of Agreement upon trust for the corporate plaintiffs because the inter-relationship of benefits under both agreements makes it logical for the beneficial interest in such benefits to be vested in the same entities. 44    As to the matter dealt with in paragraph 16(7), this matter has a clear relevance to the earlier application made by Walker Consolidated for leave to file a cross claim. For generally the same reasons as given in relation to that application, this is a matter which was not litigated and requires to be litigated in separate proceedings. 45    As to the submission advanced on behalf of Mr Walker to the effect that he is irremediably prejudiced by the grant of the leave to amend, the submission is not one of substance. No or sufficient reasons are advanced to suggest any such prejudice. Additionally the plaintiffs have asserted that on 7 June 2000 the plaintiff's solicitors requested Mr Walker solicitors to elucidate inter alia what is alleged to be the "irremediable prejudice" referred to in his submissions. The plaintiff's solicitors have asserted that by letter dated 8 June Mr Walker solicitors refused to elucidate on this and other matters raised in the plaintiff's solicitors request. In those circumstances this submission advanced on behalf of Mr Walker is rejected. 46    Finally and of relevance to both this judgment and the 1 June judgment is the fact that if I be incorrect in any aspect of the Trust analysis and/or if I be incorrect in having permitted the subject amendments to the Summons, the reasoning which underpins the 1 June judgment would still give the plaintiffs an entitlement to the order which Mr McClintock had opposed at the commencement of his address. This was an order that Mr Walker and Walker Consolidated pay to:

Lakatoi $7681,162

Ensile $3,991,000

Highfield Grove $350,000

47    This order was appropriate regardless of what precise legal vehicle might have permitted the making of such an order. This order was so appropriate because of the way in which the parties litigated the proceedings. 48    Hence it may be said that in real sense nothing in the 1 June judgment could be said to have vitally affected or prejudiced the interests of Mr Walker. However the approach which the court took was in an endeavour to ensure that the appropriate legal analysis which it seemed to me reflected the way in which the manner had been litigated, was spelt out. Another approach may have been that it was unnecessary to spell out that legal analysis. 49    For those reasons the several matters the subject of Mr Walker’s above described applications are rejected.

Costs

50    Mr Walker also seeks to revisit the question of costs of the proceedings which had been dealt with in the reasons for judgment of 25 May 2000. 51    Mr Walker submits that in the event that the plaintiffs are successful in obtaining a monetary judgment against Mr Walker, such relief will only have been granted on the basis of the amendments sought and allowed on 1 June 2000. In those circumstances, Mr Walker submits that he is entitled to the costs of the action down to the date of the amendment. He seeks to rely upon the principle that as a general rule, where a plaintiff makes a late amendment, which substantially alters the case the defendant has to meet and without which the action will fail, the defendant is entitled to the costs of the action down to the date of the amendment: Beocco Ltd v Alfa Laval Co Ltd [1995] QB 137 at 154. 52 The submission is that the court has accepted that ultimately the heart of the dispute concerned whether the defendants had breached their obligations to the plaintiffs under the Heads of Agreement or under the HUTA in a way which caused the plaintiffs significant loss. The submission is that if the plaintiffs succeed in obtaining a monetary judgment against Mr Walker, it will only be on the basis of the recent amendment. Accordingly, Mr Walker asserts an entitlement to his costs up to and including 1 June 2000 53    For the reasons given earlier in this judgment, Mr Walker's contention that the plaintiffs will have succeeded in obtaining a money judgment against Mr Walker "only on the basis of the amendments sought and allowed on 1 June 2000" is simply incorrect. For the reasons given above the 1 June amendment was made in order to reflect the manner in which the proceedings had been litigated. In the circumstances I decline to permit Mr Walker to revisit the question of costs of the proceedings already dealt with. I reject the claim Mr Walker is entitled to the costs of the action down to the date of the amendment.

I certify that paragraphs 1 - 53
are a true copy of the reasons
for judgment herein of
the Hon. Justice Einstein
given on 21 June 2000

___________________
Susan Piggott
Associate
21 June 2000

Last Modified: 09/26/2000