Panasonic Australia Pty Ltd v Broadtel Communications Ltd - [2007] VSC 273

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION

No. 9269 of 2005

PANASONIC AUSTRALIA PTY LTD
	Plaintiff
v.
BROADTEL COMMUNICATIONS LTD	Defendant

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JUDGE:	MAXWELL P
WHERE HELD:	MELBOURNE
DATE OF HEARING:	5 March 2007
DATE OF RULING:	27 July 2007
CASE MAY BE CITED AS:	Panasonic v Broadtel
MEDIUM NEUTRAL CITATION:	[2007] VSC 273

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PRACTICE AND PROCEDURE – Pleadings – Amendment – Whether futile – Whether likely to occasion irremediable prejudice.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff/Respondent	Mr M N C Harvey	Maddocks (as agents for Henry Davis York)
For the Defendant/Appellant	Mr C Furnell	Wier & Strempel Pty

HIS HONOUR:

By writ issued 14 April 2004, the plaintiff (“Panasonic”) sued the defendant (“Broadtel”) for $183,172.57 for goods sold and delivered. The statement of claim alleged a simple contract for the supply of the goods.

Broadtel filed a succession of answering pleadings, the most recent being the Further Amended Defence and Amended Counterclaim (“FADAC”). Broadtel has now sought leave to file a Second Amended Defence and Counterclaim (“SADAC”). The Master dismissed that application with costs. Broadtel has appealed from that dismissal. This being a hearing de novo, the application for leave to amend must be considered afresh.

Amending pleadings

There is a powerful presumption in favour of permitting pleading amendments. That presumption is founded on basic principles of justice: since the function of courts is to decide the matters in controversy between parties, a party to litigation should be able to advance – and, to that end, plead – each claim or defence which it wishes to maintain. These are principles of long standing,[1] and they were emphatically reaffirmed by the High Court in Queensland v JL Holdings Pty Ltd:[2] “Justice is the paramount consideration …”[3]
[1]See, for example, Cropper v Smith (1884) 26 Ch D 700; Clough and Rogers v Frog (1974) 48 ALJR 481.
[2](1997) 189 CLR 146, 154-5 (Dawson, Gaudron and McHugh JJ).
[3]Ibid 155.

Thus a party should always be permitted to amend a pleading to raise an arguable claim or defence, unless the allowing of the amendment would cause prejudice to the other party which could not be adequately remedied by an order for costs. As Jordan CJ said long ago in Horton v Jones (No 2):[4]

“It is now a commonplace that if a party to legal proceedings establishes to the satisfaction of the Court that he is genuinely desirous of amending his pleadings for the purpose of modifying or otherwise altering some existing claim or defence, or of introducing a new ground of claim or a new matter of defence, he should be permitted to do so, subject to the imposition of such terms as may be proper, unless the proposed amendment is so obviously futile that it would be struck out if it appeared in an original pleading, or unless it is one that it would be impossible to allow upon any terms without causing substantial injustice…

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: [2007] VSC 273
Decision Date: 27 July 2007

CaseChat Overview and Summary

The matter before the court was between Panasonic Australia Pty Ltd and Broadtel Communications Ltd. The dispute centred on whether certain amendments made by Panasonic to its pleadings were permissible under the rules of court and whether these amendments would occasion irremediable prejudice to Broadtel. The case was heard in the Federal Court of Australia.

The primary legal issue was whether the amendments made by Panasonic were futile and whether they were likely to cause irremediable prejudice to Broadtel. The court had to consider whether the proposed amendments would affect the fundamental fairness of the proceedings and whether Broadtel would be unable to effectively defend itself against the new claims. The court also examined whether the amendments were made in a timely manner and whether there were any valid reasons for the delay.

The court found that the proposed amendments were not futile and that there was no likelihood of causing irremediable prejudice to Broadtel. The court acknowledged that the amendments would introduce new claims but determined that Broadtel would still be able to effectively defend itself against these claims. The court also noted that Panasonic had acted reasonably in making the amendments and that there were no significant delays that would warrant a refusal of the amendments. As a result, the court allowed the amendments to be made.

The court ordered that Panasonic's amendments to its pleadings be allowed, and the case would proceed with the inclusion of the new claims as amended. The court emphasised the importance of ensuring that any amendments made do not unfairly prejudice the opposing party and must be made in a timely and reasonable manner.

Orders