Pope & Ors v Harris Orchard

Case [2010] SASC 354

SUPREME COURT OF SOUTH AUSTRALIA

(Miscellaneous Appeal: Civil)

POPE & ORS v HARRIS ORCHARD

[2010] SASC 354

Judgment of The Honourable Justice White

23 December 2010

PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - PROCEDURE UNDER RULES OF COURT - PLEADINGS - GENERALLY

PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - PROCEDURE UNDER RULES OF COURT - AMENDMENT

The defendants to an action alleging breaches of trust obligations brought a third party cross-action against a firm of accountants, alleging that they had breached a series of duties owed to them - the defendants sought permission to file an amended statement of claim against the third parties - a master refused permission to amend on the basis of deficiencies in the pleading and because the proposed amended statement of claim was vague, embarrasing and vexatious.

Held:  appeal dismissed - the proposed amended statement of claim did not comply with the pleading requirements of the Supreme Court Civil Rules 2006 (SA).

Supreme Court Civil Rules 2006 (SA) r 98, r 99, r 101, referred to.
Holcon Australia Pty Ltd v Corporation of the Town of Walkerville [2007] SASC 437; Williams v Australian Telecommunications Commission (1988) 52 SASR 215; Marini v MLH Insurance Brokers Pty Ltd [2004] SASC 400; Duke Group Ltd (in liq) v Arthur Young (1991) 4 ACSR 355, considered.

POPE & ORS v HARRIS ORCHARD
[2010] SASC 354

Appeal from a Master

  1. WHITE J: The defendants appeal against a master’s refusal to grant them permission to amend the statement of claim by which they seek relief from third parties.

  2. The plaintiff’s action was commenced on 5 September 2006, and these proceedings are accordingly governed by the Supreme Court Civil Rules 2006. The plaintiff’s summons was accompanied by a statement of claim which has not since been amended.  Each of the defendants filed defences to the plaintiff’s statement of claim on 2 March 2007, and amended defences on 5 June 2007.

  3. The defendants issued a third party notice with an accompanying statement of claim on 13 July 2007.  The third parties filed a defence on 20 September 2007.  The period of three years which has elapsed since then appears to have been occupied principally with attempts by the defendants to get their third party pleading into proper form.  A master rejected one application to amend the third party statement of claim on 29 May 2008, and rejected a further application on 28 June 2010.  The defendants’ present appeal is against the latter decision.

    The Plaintiff’s Claim

  4. It is appropriate to commence by noting the matters alleged by the plaintiff against the defendants.

  5. The plaintiff is the son of the first defendant (Des Pope) and the brother of the third, fourth and fifth defendants (Danielle, Dale and Deanna).  Members of the Pope Family have interests in, or control, a number of companies and trusts referred to collectively as “the Pope Group”.  Des Pope is said to be the controlling mind of the Pope Group.

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AGLC
Pope & Ors v Harris Orchard [2010] SASC 354
Case
[2010] SASC 354
Decision Date

CaseChat Overview and Summary

The defendants, Pope and others, sought permission to amend their statement of claim against a firm of accountants, Harris Orchard, in a case heard in the Supreme Court of South Australia. The defendants, who were also defendants in an action brought by OE & DR Pope Pty Ltd, brought a third party cross-action against Harris Orchard, alleging breaches of trust obligations and professional duties. The defendants sought to amend their statement of claim to include additional allegations against Harris Orchard, but a Master refused permission, finding the pleading to be vague, embarrassing, and vexatious. The defendants appealed the Master's decision. The court had to decide whether the defendants' proposed amended statement of claim was sufficiently clear and specific to warrant permission to amend, and whether the third parties, Harris Orchard, would suffer any prejudice if the amendment was allowed. The court also had to consider whether the defendants had the primary responsibility of ensuring that their pleading was compliant with the Rules. The court dismissed the appeal and remitted the matter to the Master for further consideration. The court found that the defendants' proposed amended statement of claim was inadequately pleaded, and that the expression "at all times material to this action" introduced vagueness and uncertainty. The court emphasised that the defendants had the primary responsibility of establishing that their proposed pleading was compliant with the Rules, and that non-compliance may be excused only if the third parties would not suffer any detriment. The court considered that the defendants should commence their pleading against the third parties afresh, after identifying the particular loss or detriment in respect of which they seek relief, the manner in which they assert that loss or detriment results from some action or omission of the third parties, the elements of each cause of action upon which they rely, and the material facts which must be proved in order to establish those causes of action. The court also noted that the third parties had asserted uncertainty as to the precise basis of the defendants' claims, and that this was a factor to be considered in determining whether permission to amend should be granted. The court will hear the parties as to costs.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

I agree that this may be a matter which could be left to trial so that, subject to the trial Judge taking a contrary view, the defendants would be precluded from adducing evidence of any other matter to support the evidence of such a wide-ranging, and in some respects unusual, duty. However, the Master considered that [46] was inadequately pleaded. I agree with that conclusion and consider also that [48] suffers from the same defect.Conclusion For the reasons given above, I dismiss the appeal. I will remit the matter to the Master for him to determine whether the defendants should be given a further opportunity to put their statement of claim against the third parties into proper form. If the defendants are given that opportunity, it would be appropriate, in my respectful opinion, for them to commence their pleading against the third parties afresh. That should occur after the defendants have identified the particular loss or detriment in respect of which they seek relief from the third parties; the manner in which they assert that loss or detriment results from some action or omission of the third parties; the elements of each cause of action upon which they rely; and the material facts which must be proved in order to establish those causes of action. I will hear the parties as to costs.

Ratio Decidendi

Legal Principle Established

The defendants submitted that the third parties, although opposing the amendment, had not asserted that they would be prejudiced if it was allowed, or that they did not know the case which they had to meet. Whether or not this was so in the argument before the Master, I cannot say, but the third parties on the appeal did assert uncertainty as to the precise basis of the defendants’ claims. Further, the absence of prejudice is only one factor to be considered. The defendants have the primary responsibility of establishing that their proposed pleading is compliant with the Rules. If it is not, some non-compliance may be excused if the third parties would not suffer any detriment, but one does not start from the proposition that an amendment should be allowed unless the opposing party can identify some prejudice or detriment. Consideration of Appeal“At all Times Material” The Master considered that in the context of the defendants’ claim against the third parties, the use of the expression “at all times material to this action” as the preface to some 12 of the pleaded allegations introduced vagueness, embarrassment and vexation. He considered that the expression was capable of referring to some or all of the period commencing in 1974 and continuing until the present time. Given that the impugned conduct of the third parties was limited, and was said to have occurred at particular times, the Master considered that the defendants should be more specific. It is reasonable to suppose that the expression “at all times material to this action” is used with the same meaning each time it appears in the ASC. I note that in Action No SCCIV-01-1922, the plaintiff (OE & DR Pope Pty Ltd) is a member of the Pope Group and that the third parties to these proceedings are the defendants. The precise allegations made in Action No SCCIV-01-1922 are not presently material although they do have some similarities with the claims which the defendants make against the third parties in these proceedings. The solicitors for the defendants and third parties in these proceedings are the same as the respective solicitors for the plaintiff and defendants in Action No SCCIV-01-1922. In a decision published on 9 April 2009 in Action No SCCIV-01-1922, Judge Lunn refused to grant leave to OE & DR Pope Pty Ltd to amend their pleading while it used the expression “the times material to this action”. Judge Lunn said:The phrase “the times material to this action” as defined in paragraph 24 is embarrassing and vexatious in that it is ambiguous and too vague. It apparently could mean a time span from the earliest of the dates and events referred to in paragraphs 26-29 to the last of those dates and events. On the dates stated that is range between 1976-1996 and on the “times” or events referred to in those paragraphs the span could stretch from the inception of the trust as referred to in the preamble to paragraph 28 (which was 1974) to the commencement of this action as being the times when the defendant was aware of the dealings pleading in paragraph 29. Alternatively the phrase could mean only these times referred to and not those in between.The same observation may be made in respect of the ASC.