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McSeveny v Ultimate IP Holdings Pty Ltd

McSeveny v Ultimate IP Holdings Pty Ltd

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Case Copied 7 August 2018 51 min read

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Supreme Court

New South Wales

Medium Neutral Citation: McSeveny v Ultimate IP Holdings Pty Ltd [2018] NSWSC 1197
Hearing dates: 6 April 2018
Date of orders: 07 August 2018
Decision date: 07 August 2018
Jurisdiction: Common Law
Before: Davies J
Decision:
(1) Grant leave to the cross-claimants to amend the Amended First Cross-Claim filed 16 March 2017 by:

(a) adding as the third and fourth cross-claimants Timothy Hennessy and Paul McCloskey respectively;

(b) preparing a Further Amended Cross-Claim in accordance with these reasons for judgment;

(c) serving the Further Amended Cross-Claim on the solicitors for the plaintiff/cross-defendant by 27 August 2018.

(2) The solicitors for the plaintiff/cross-defendant are to inform the solicitors for the defendants/cross-claimants by 7 September 2018 if they agree with the form of the Further Amended Cross-Claim.

(3) If consent is given to the form of the Further Amended Cross-Claim the Further Amended Cross-Claim is to be filed and served by 11 September 2018;

(4) The defendants/cross-claimants are to pay the plaintiff/cross-defendant’s costs thrown away by reason of the amendments.
(5) Stand over the proceedings to 14 September 2018 to hear submissions on the costs of the Notice of Motion and any disputes concerning the form of the Further Amended Cross-Claim.
Catchwords:
CIVIL PROCEDURE – cross-claims – amendment – to set up cause of action barred by limitation period –cause of action conferred by Commonwealth statute – Australian Consumer Law ss 236, 237 – whether State statute permits amendment after expiry of limitation period – Civil Procedure Act 2005 (NSW) s 65

CIVIL PROCEDURE – cross-claims – amendment – claim of negligent misrepresentation – whether cross-claimant who obtained contractual warranties had requisite ‘vulnerability’ – whether claim futile – factual determination - inappropriate for interlocutory application – leave to amend granted

CIVIL PROCEDURE – parties – joinder – of cross-claimants – after expiration of limitation period – where no misnomer or misdescription of parties – date when addition takes effect – Civil Procedure Act 2005 (NSW) s 64 – UCPR rr 6.28, 19.2 – limitation period stayed where cross-claim made by persons party to the proceedings before expiration – Limitation Act 1969 (NSW) s 74
CIVIL PROCEDURE – cross-claims – amendment – whether amendments work prejudice to cross-defendant – no hearing date fixed – prejudice minimal
Legislation Cited: Competition and Consumer Act 2010 (Cth) Sch 2 – Australian Consumer Law ss 237, 239, 243
Civil Liability Act 2002 (NSW) Pt 4
Civil Procedure Act 2005 (NSW) ss 56-58, 64, 65
Fair Trading Act 1987 (NSW)
Limitation Act 1969 (NSW) s 74
Supreme Court Act 1970 (NSW) s 75
Trade Practices Act 1974 (Cth)
Uniform Civil Procedure Rules 2005 (NSW) rr 6.19, 6.24, 6.28, 19.2
Cases Cited: Agtrack (NT) Pty Ltd v Hatfield (2005) 223 CLR 251; [2005] HCA 38
Ahmed v Harbour Radio Pty Ltd [2010] NSWSC 676
Air Link Pty Limited v Paterson (No. 2) (2003) 58 NSWLR 388; [2003] NSWCA 251
Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2018] NSWSC 1197
Decision Date: 07 August 2018

CaseChat Overview and Summary

In McSeveny v Ultimate IP Holdings Pty Ltd, the dispute arose from an application for leave to amend a cross-claim, which was filed after the limitation period had expired. The cross-claimants sought to bring claims against the cross-defendants, including claims for negligent misrepresentation. The proceedings were before the Supreme Court of New South Wales, which needed to decide whether the cross-claimants could amend their pleadings to include these claims, which were barred by the limitation period.

The primary legal issues the court had to address included whether the statutory provisions under the Civil Procedure Act 2005 (NSW) and the Australian Consumer Law permitted the amendment of the cross-claim after the limitation period had expired. Additionally, the court had to determine if the cross-claimants had the requisite vulnerability to pursue a claim for negligent misrepresentation and whether permitting the amendments would prejudice the cross-defendants. The court considered the implications of the Limitation Act 1969 (NSW) and the rules under the Uniform Civil Procedure Rules 2005 (NSW) in its decision.

The court ruled that the statutory provisions allowed for amendments to be made despite the expiry of the limitation period, provided that the amendment did not prejudice the opposing party. The court found that the limitation period was stayed during the time the cross-claim was made by parties already involved in the proceedings. In regard to the cross-claimants’ vulnerability, the court held that this was a factual determination inappropriate for an interlocutory application. Consequently, the court granted leave for the cross-claimants to amend their pleadings to include the claims for negligent misrepresentation. The court also determined that the addition of the cross-claimants would not prejudice the cross-defendants, as no hearing date had been fixed, and the prejudice would be minimal.

The final orders included granting leave for the cross-claimants to amend their pleadings to include the claims for negligent misrepresentation and to join additional parties as cross-claimants. The court emphasised that the limitation period would remain stayed during the pendency of the cross-claim and would not prejudice the cross-defendants.

Orders