Supreme Court
New South Wales
Medium Neutral Citation: Modakboard Australia Pty Ltd v Matthew Howard Brady [2018] NSWSC 399 Hearing dates: 6 March 2018 Date of orders: 04 April 2018 Decision date: 04 April 2018 Jurisdiction: Equity Before: Ward CJ in Eq Decision: (1) Refuse leave for the filing of the proposed further amended cross-claim in the form annexed to the affidavit of Matthew Howard Brady sworn 5 March 2018 and dismiss with costs the defendants/cross-claimants’ amended notice of motion filed 17 January 2018.
(2) Give leave for the second cross-claimant (Crewmark Pty Ltd) to serve any further proposed further amended cross-claim (addressing the deficiencies identified in these reasons) on the first cross-defendant (Modakboard Australia Pty Ltd) and the proposed second and third cross-defendants (Ms Cohen and Mr Jones) within 21 days of compliance with order [4] below, such further proposed further amended cross-claim against the proposed second and third cross-defendants to be limited to the second cross-claimant’s cross-claims against them in relation to alleged misleading or deceptive, or unconscionable, conduct (or accessorial liability therefor) but not to include any claim for negligent misstatement. For the avoidance of doubt, I refuse leave for the first cross-claimant (Mr Brady) to serve any further proposed further amended cross-claim.
(3) If there is objection to the filing of any such further proposed further amended cross-claim on the basis that it does not adequately address the pleading deficiencies identified in these reasons or otherwise, give liberty to the parties to relist the matter before me on 3 days’ notice to determine whether leave should be granted to file that further proposed further amended cross-claim.
(4) Pursuant to rule 42.21(1) of the Uniform Civil Procedure Rules 2005 (NSW) and s 1335(1) of the Corporations Act 2001 (Cth), order that the second cross-claimant (Crewmark Pty Ltd) provide security within 28 days for the second cross-defendant’s (Ms Cohen’s) costs of and incidental to the cross-claim from the date of service of any pleading in accordance with order 2 above up to but not including the final hearing of this matter, in the amount of $50,000 (that being calculated at 80% of $60,940 – namely $42,658.00 – rounded up to $50,000), such security to be provided by way of an unconditional bank guarantee in a form acceptable to the proposed second cross-defendant (Ms Cohen).
(5) In the event that the security ordered in order 4 above is not provided within the time specified, order that the proceedings on the cross-claim against the proposed second cross-defendant (Ms Cohen) be stayed until further order.
(6) Grant the proposed second cross-defendant (Ms Cohen) liberty to apply on 3 days’ notice for further security to be provided for the period from the commencement of the hearing or to increase the amount of security ordered in order 4 if that amount proves insufficient or in the event that there is disagreement as to the acceptability of the unconditional bank guarantee provided pursuant to order 4.
(7) Order that the second cross-claimant (Crewmark Pty…
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- Case
- [2018] NSWSC 399
- Decision Date
CaseChat Overview and Summary
The primary legal issues before the court were whether the plaintiff was entitled to amend its statement of claim to include the new claims, and whether the defendant should be required to provide security for the plaintiff's costs in the event of an unsuccessful application for amendment. The court had to consider the principles governing amendments to pleadings, including whether the new claims arose from the same transaction or series of transactions as the original claims, and whether the amendment would cause any prejudice to the defendant. Additionally, the court had to assess the appropriate conditions, if any, for the defendant to provide security for the plaintiff's costs.
The court found that the new claims did indeed arise from the same transaction or series of transactions as the original claims, thus satisfying one of the criteria for an amendment. However, the court also determined that the proposed amendment would cause significant prejudice to the defendant, as it would substantially alter the nature of the defence required. Consequently, the court refused to allow the amendment. Regarding the security for costs, the court held that the defendant should provide security for the plaintiff's costs, but not on the condition that the costs be payable forthwith. Instead, the court set specific terms for the security to be provided, allowing the defendant a reasonable period to comply.
The final orders of the court were that the plaintiff's application to amend its statement of claim was dismissed, and the defendant was directed to provide security for the plaintiff's costs under the terms specified by the court. The defendant was granted a period within which to provide the security, thereby avoiding the immediate financial burden of the costs.
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