O'Malley Nominees Pty Ltd v Shawtec Pty Ltd - [2010] WADC 2

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS

LOCATION: PERTH

CITATION: O'MALLEY NOMINEES PTY LTD -v- SHAWTEC PTY LTD & ORS [2010] WADC 2

CORAM: MARTINO DCJ

HEARD: 14 JANUARY 2010

DELIVERED : 14 JANUARY 2010

FILE NO/S: CIV 1163 of 2004

BETWEEN: O'MALLEY NOMINEES PTY LTD (ACN 008 782 821)
Plaintiff
AND
SHAWTEC PTY LTD (ACN 070 514 966)
First Defendant
MICHAEL JOHN SHAW
LAURENCE DAVID SHAW
Second Defendants

Catchwords:

Practice and procedure - Application to amend writ of summons and statement of claim - Considerations of delay and expense

Legislation:

Nil

Result:

Application allowed in part

Representation:

Counsel:

Plaintiff:     Mr A J N Aristei
First Defendant             :     Mr A R MacPherson
Second Defendants       :     Mr A R MacPherson

Solicitors:

Plaintiff:     Irwin Legal
First Defendant             :     Hotchkin Hanly
Second Defendants       :     Hotchkin Hanly

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

Aon Risk Services Australia Ltd v Australian National University (2009) 258 ALR 14
Morgan v Banning (1999) 20 WAR 474
Stone James v Pioneer Concrete (WA) Pty Ltd [1985] WAR 233

MARTINO DCJ: This action was commenced in the Supreme Court on 24 March 2003. The writ of summons by which the action was commenced was endorsed with a four page indorsement of claim in which the plaintiff, O'Malley Nominees, as landlord, claimed from the first defendant, Shawtec, as tenant and the second defendants, Mr and Mrs Shaw, as guarantors of Shawtec's obligations under the lease, possession of three units in Guthrie Street, Osborne Park, arrears of outgoings, rent or alternatively mesne profits and damages for breach of contract. The action was transferred to this court on 21 November 2003. By that time Shawtec had vacated the premises at the end of the lease period on 30 June 2003 and so the claim for possession was no longer being pursued.
On 13 December 2004 O'Malley Nominees filed and served its statement of claim. It is a 20 page document in which O'Malley Nominees claims unpaid outgoings, interest on any unpaid rent and outgoings, mesne profits, damages for breaches of covenants, damages for wrongful termination or repudiation of leases and interest. The statement of claim was signed by Mr A J Aristei, who continues to act as counsel for O'Malley Nominees.
On 13 May 2009 O'Malley Nominees applied for leave to amend its statement of claim. The amendments for which leave was sought were substantial. They were, in summary, to plead:
a.that a deed of renewal of sub-lease incorporated the terms of the initial sub-lease, as well as the original lease, and that Shawtec had breached a term of the initial sub-lease;
b.additional breaches of the original lease in failing to comply with obligations to maintain the leased premises;
c.additional breaches of the original lease in failing to comply with all relevant laws;
d.that there were amendments made to a lease of one of the units by discussions and correspondence that took place in September 2000;
e.that O'Malley Nominees had taken steps to mitigate its loss arising from Shawtec's failing to maintain the premises;
f.that Shawtec had breached an essential term or covenant of the leases and to claim damages for the breach and that the breach resulted in O'Malley Nominees' lawful termination of the leases; and
g.that Shawtec had engaged in unconscionable conduct and to claim damages and declaratory relief pursuant to s 82 and s 87 of the Trade Practices Act 1974.
On 11 August 2009 O'Malley Nominees applied for leave to amend the writ of summons by adding to it claims for damages for wrongful repudiation or alternatively breaches of an essential term of the lease, damages and declaratory relief pursuant to s 82 and s 87 of the Trade Practices Act 1974 and damages for breaches of covenants.
On 3 September 2009 O'Malley Nominees filed an affidavit sworn on that day by John Goldthorpe, a director of O'Malley Nominees, in support of the applications for leave to amend the writ and the statement of claim. In that affidavit Mr Goldthorpe deposed that the original statement of claim was drafted by his previous solicitors, that to the best of Mr Goldthorpe's recollection he raised with the principal of his previous solicitors the type of matters for which leave to amend is sought and that during Mr Goldthorpe's recent preparation of the matter for trial he was informed by his solicitors or counsel that a substantial part of the matters now sought to be included in the proposed amended statement of claim were not included.
O'Malley Nominees's applications were heard by Principal Registrar Gething on 15 October and 2 November 2009. On 11 November 2009 the Principal Registrar delivered reasons for his decision to allow some only of the amendments sought. The amendments allowed were, in summary, the pleading that Shawtec had breached an essential term or covenant of the leases, to claim damages for the breach and that the breach resulted in O'Malley Nominees' lawful termination of the leases and appropriate minor clarifying or typographical amendments.
O'Malley Nominees appeals against that decision. The appeal is a new hearing of the original applications. O'Malley Nominees does not pursue all of the amendments that it proposed to make. The application now concerns only the proposed amendments to plead:
a.that a deed of renewal of sub-lease incorporated the terms of the initial sub-lease, as well as original lease, and that Shawtec had breached a term of the initial sub-lease;
b.additional breaches of the original lease in failing to comply with all relevant laws; and
c.that there were amendments made to a lease of one of the units by discussions and correspondence that took place in September 2000.
O'Malley Nominees has not filed fresh minutes of proposed amended writ of summons or statement of claim.
The principals upon which the applications are to be considered are set out in Aon Risk Services Australia Ltd v Australian National University (2009) 258 ALR 14, in particular at [111] to [113].
The delay in seeking to make these proposed amendments is very substantial. There is no adequate explanation for the delay. In particular, there is no evidence that any new material has become available to O'Malley Nominees to cause the applications to amend and there is no explanation in evidence of why the application is made when the counsel who signed the original statement of claim continues to act as counsel for O'Malley Nominees.
The amendments allowed by the Principal Registrar were, effectively, to allow O'Malley Nominees to amend the writ and the statement of claim to express more clearly claims that existed in the original documents. They are within scope of the causes of action in the original indorsement, having regard to the way that the indorsement is to be considered in light of authorities such as Stone James v Pioneer Concrete (WA) Pty Ltd [1985] WAR 233 and Morgan v Banning (1999) 20 WAR 474. In my view it is appropriate to allow those amendments. The other amendments that O'Malley Nominees applies for, if allowed, would cause additional delay and expense to the parties and to the court. The time has come where this action should be brought to a conclusion. By reason of the extent of the proposed amendments, the delay in applying for them, the failure to provide an adequate explanation for the delay and the additional delay and expense that would be caused to the parties and the court if the amendments were allowed I have decided that I should exercise my discretion to refuse leave to make those amendments.
The applications to amend, other than the amendments allowed by the decision of the Principal Registrar, are refused.
The orders I propose to make are:
1.The plaintiff have leave to amend the writ of summons and the statement of claim in the terms allowed by the Principal Registrar on 11 November 2009;
2.The applications for leave to amend the writ of summons and the statement of claim are otherwise dismissed;
3.The plaintiff pay the costs of the application and of the appeal to be taxed;
4.The action be listed for a case management directions hearing before the Principal Registrar.