Teo Tran t/as Canberra Direct and as Canberra Mailing v Calvista Australia Pty Ltd
[2010] ACTCA 5
•4 March 2010
TEO TRAN T/AS CANBERRA DIRECT AND AS CANBERRA MAILING v CALVISTA AUSTRALIA PTY LTD [2010] ACTCA 5 (4 March 2010)
APPEAL – application to adduce further evidence – expert evidence received after conclusion of hearing revealed witness suffered from dyslexia – whether evidence could be admitted at appeal – evidence not in admissible form – expert not made available for cross-examination – Court not satisfied that dyslexia affected witness’s ability to answer questions at trial – Court not satisfied that availability of the evidence at trial would have produced a different result – application dismissed.
APPEAL – whether Master erred in refusing application by the appellant to amend its defence – application made after conclusion of the hearing – whether amendment was in the interests of justice – amendment sought would have required rehearing and would have caused substantial injustice to plaintiff – injustice suffered could not have been overcome by costs order – no error found in refusal to grant amendment – appeal dismissed.
Court Procedures Rules 2006 (ACT), rr 502, 507, 5602, 5606
Supreme Court Act 1933 (ACT), s 37N(3)
Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175
CDJ v VAJ (1998) 197 CLR 172
Coulton v Holcombe (1986) 162 CLR 1
Council of the City of Greater Wollongong v Cowan (1955) 93 CLR 435
Equuscorp Pty Ltd (formerly Equus Financial Services Ltd) v Lah and Others [1999] ACTSC 87
House v The King (1936) 55 CLR 499
Londish and Others v Gulf Pacific Pty Limited (1993) 45 FCR 128
Makita (Australia) Pty Ltd v Sprowles (2001) 52 NSWLR 705
North Australian Aboriginal Legal Aid Service Incorporated v Liddle (1994) 118 FLR 109
Sobey v Nicol and Davies (2007) 245 ALR 389
The State of Queensland and Another v JL Holdings Pty Limited (1997) 189 CLR 146
ON APPEAL FROM THE MASTER OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
No. ACTCA 7 of 2008
No. SC 944 of 2005
Judges: Refshauge, Penfold and Cowdroy JJ
Court of Appeal of the Australian Capital Territory
Date: 4 March 2010
IN THE SUPREME COURT OF THE ) No. ACTCA 7 of 2008
) No. SC 944 of 2005
AUSTRALIAN CAPITAL TERRITORY )
)
COURT OF APPEAL )
ON APPEAL FROM THE MASTER OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
BETWEEN:TEO TRAN T/AS CANBERRA DIRECT AND AS CANBERRA MAILING
Appellant
AND:CALVISTA AUSTRALIA PTY LTD
Respondent
ORDER
Judges: Refshauge, Penfold and Cowdroy JJ
Date: 4 March 2010
Place: Canberra
THE COURT ORDERS THAT:
The appeal be dismissed.
The appellant pay the costs of the respondent.
IN THE SUPREME COURT OF THE ) No. ACTCA 7 of 2008
) No. SC 944 of 2005
AUSTRALIAN CAPITAL TERRITORY )
)
COURT OF APPEAL )
ON APPEAL FROM THE MASTER OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
BETWEEN:TEO TRAN T/AS CANBERRA DIRECT AND AS CANBERRA MAILING
Appellant
AND:CALVISTA AUSTRALIA PTY LTD
Respondent
Judges: Refshauge, Penfold and Cowdroy JJ
Date: 4 March 2010
Place: Canberra
REASONS FOR JUDGMENT
THE COURT:
APPLICATION TO ADDUCE FURTHER EVIDENCE
Before this Court is an appeal from the decision of Master Harper delivered on 7 March 2008 and an application to adduce further evidence. Before proceeding to determine the appeal, the Court will consider the application to adduce further evidence.
THE APPLICATION
The application to adduce further evidence is brought by Teo Tran trading as Canberra Direct and as Canberra Mailing (the appellant) pursuant to r 5602 and r 5606 of the Court Procedures Rules 2006 (ACT) (‘the Rules’) and s 37N(3) of the Supreme Court Act 1933 (ACT).
The application is supported by one affidavit sworn on 12 August 2008 by Thomas Arthur Royston, the second defendant in the proceedings before the Master (but not a party to the appeal), and two affidavits of Trevor Joseph Barker, solicitor for the appellant, sworn on 12 August 2008 and 22 April 2009.
The proceedings commenced before Master Harper on 22 May 2007. Mr Royston, who was employed by the appellant, gave evidence on 4 and 5 July 2007. His Honour delivered judgment on 7 March 2008 in which his Honour found against the first defendant. On 2 April 2008 a Notice of Appeal was filed.
On the prompting of the appellant’s legal counsel during May and June 2008 Mr Royston consulted his general practitioner Dr Craig Smee, and was then referred to Dr Collin Andrews, a neurologist, and to Mr Tom Sutton, a psychologist. Dr Andrews diagnosed Mr Royston as suffering from dyslexia.
On 28 August 2008 an Amended Notice of Appeal was filed. Such notice informed Calvista Australia Pty Ltd (the respondent) that the appellant would seek to place before this Court fresh evidence concerning the medical condition of Mr Royston. The appellant relied upon the medical reports of Dr Andrews, dated 20 June 2008, and of Mr Sutton, dated 10 July 2008 (‘the fresh evidence’). The grounds of appeal were also amended to include the following submission:
xiii. The Learned Master erred in finding that the evidence of Mr. Royston was “unsatisfactory to the extent that [he] would be disinclined to believe any evidence [Mr Royston] gave [in] his own interests unless it was independently corroborated” by reason of the fact that the Learned Master was unaware – as was Mr. Royston – that Mr. Royston’s demeanour and answers were conditioned by an undiagnosed medical/neurological condition which prevented him from understanding questions put to him and prevented him from responding to questions in a meaningful and appropriate manner.
The application to adduce the fresh evidence about Mr Royston’s medical condition is based upon the submission that Mr Royston’s medical condition had the consequence that he was unable to follow some of the questions asked of him during the hearing before Master Harper. As a result Mr Royston was unable to provide answers to such questions. In his affidavit sworn in support of the application Mr Royston deposed:
When I was giving evidence in this matter I found the questions I was being asked confusing. I was unable to follow some of them so I couldn’t answer them.
The appellant submits that in consequence of Mr Royston’s inability to answer questions, Master Harper found Mr Royston to be an “unsatisfactory oral witness” and an “unconvincing witness” and made the following observation:
I found the evidence Ms Tran [sic] unconvincing, and that of Mr Royston unsatisfactory to the extent that I would be disinclined to believe any evidence he gave in his own interests unless it was independently corroborated.
The Master’s findings about Mr Royston’s evidence are said to have been significant in his decision against the appellant. The appellant submits that as Mr Royston was the only witness of the appellant who could provide evidence of the purported oral terms of the agreement in the trial, “judgment for the respondent was all but inevitable” following the rejection of his evidence.
The appellant relies upon various extracts from the transcript of the hearing before Master Harper in support of its submission that Mr Royston was having difficulties in answering questions. Reliance is also placed upon two incidents on the second day of Mr Royston’s evidence. The first incident relied upon was the grant of an adjournment during the second day of Mr Royston’s cross-examination in view of his apparent distress. The second incident occurred later on the same day when Mr Royston, also during his cross-examination, sought medical assistance from an ambulance officer before he proceeded to answer further questions.
The appellant also relied upon the evidence of Dr Andrews contained in reports provided on 8, 16 May and 20 June 2008 together with the report of Mr Sutton of 10 July 2008. The appellant submits that the previously undiagnosed condition of dyslexia affected Mr Royston’s ability to comprehend and answer long questions and accordingly to respond appropriately.
FINDING
The respondent objected to the admission of the medical reports and relied upon the principle that evidence of an expert must be provided to the Court in admissible form: see Makita (Australia) Pty Ltd v Sprowles (2001) 52 NSWLR 705 especially at 729-731. The manner in which the expert evidence of Dr Andrews and Mr Sutton has been placed before the Court is less than satisfactory in several respects. The appellant should have provided sworn affidavits from the expert witnesses attaching their reports rather than merely presenting the Court with the medical reports attached to an affidavit sworn by the appellant’s solicitor. Nor has either expert been made available for cross-examination.
We also observe that the opinions of the medical experts have been given in response to a series of identical questions which were provided to each of them. The answers given by each expert are thus constrained by the questions asked of them. Nevertheless, for present purposes, we consider it preferable to assume that the evidence supporting the application is admissible, and to deal with the application to adduce fresh evidence on its merits.
Mr Royston’s affidavit discloses that he was “always aware” that he had difficulty in answering oral questions but did not know the reason for such difficulty until his condition was diagnosed by Dr Andrews and Mr Sutton. Such evidence is supported by Dr Andrews who, in diagnosing the condition of dyslexia, opined that Mr Royston had probably had the condition for most of his life. Dr Andrews considered that such condition impaired Mr Royston’s ability to give evidence and believed that such impairment was between moderate and severe. His report of 8 May 2008 indicates that Mr Royston had a “similar problem in court 14 years prior to that”. The reference to “that” is to the incident on 5 July 2007 when Mr Royston was distressed. Dr Andrews prescribed no treatment for Mr Royston’s condition and concluded:
He functions quite well provided he compensates for his long-standing underlying deficit.
In his report of 10 July 2008 Mr Sutton states that Mr Royston’s problem is of a long-standing nature and that Mr Royston is highly intelligent and is likely to have worked out “compensatory strategies to some degree, to get his literacy levels to functional levels”.
As to the likelihood that Mr Royston would have difficulty in answering questions in cross-examination, Mr Sutton said:
…in my view, if any question held more than one part, then yes. If the focus of questioning changed rapidly or repeatedly, then yes. If any strand of questioning required him to focus on an earlier part whilst retaining the latter part, again, yes. Any dual tasking (reading and listening at the same time) would be significantly slowed. He is likely to have become flustered, which would further exacerbate the working memory problem (as anxiety is disruptive of this). Questions need to be highly succinct, and the subject matter of the question told to him so that he can keep that in mind whilst listening to the words. The test data is consistent across tasks and shows he performs in these areas no better than 0.4% to 9% of his age group.
The medical evidence is accordingly unanimous that Mr Royston would experience difficulty in answering long questions, although it also suggests that Mr Royston is able to compensate for such difficulty.
During the second day of Mr Royston’s cross-examination before the Master it became apparent that he was suffering some form of difficulty. His Honour asked Mr Royston whether he was feeling unwell and the transcript records “(witness distressed)”. Accordingly an adjournment was granted and the hearing resumed after approximately five minutes, when the Master asked Mr Royston if he was able to continue. Mr Royston acknowledged that he was able to continue. There was no request by his legal advisers, who were also acting for the appellant, for an adjournment of proceedings even though the evidence suggests that they were aware that Mr Royston experienced difficulty in answering long questions. Mr Sutton’s report sets out a history obtained from Mr Royston. The report states:
He says he had warned the lawyers he was unable to answer ‘long’ questions without having them broken in simpler constituents.
The appellant has referred the Court to various answers to questions provided by Mr Royston from which it is said the Court can infer that Mr Royston was suffering from an inability to comprehend the question. We have considered such passages, which include Mr Royston’s statement made during the cross-examination when he said:
I’ve got a problem with big questions – long questions. I can’t remember the first half of what’s been said.
In answer to several of the questions asked of him, it is apparent that Mr Royston, in providing his answer, questioned the cross-examiner to clarify the precise question that was being asked of him. In other instances Mr Royston made it plain that he could not remember the first sentence of the question. Towards the end of the second day of the hearing, at approximately 3:14 pm, when questions were asked implying that Mr Royston had never made any complaint about alleged breaches of the agreement between the appellant and the plaintiff, he responded:
I’ve got a small problem. The – the guy from the ambulance told me to try and get my questions shorter. I somehow have got some chemical imbalance and I can’t remember when you said it long like that, I can’t remember the first half.
While some of the answers given by Mr Royston indicate that he required the question to be restated, there is no instance from which we could infer that Mr Royston’s responses were based upon any misunderstanding of the questions asked of him or that he did not intend to provide the answers so provided. Further, it is not part of the appellant’s appeal that Mr Royston did not understand questions or has given evidence that he did not intend to give. In these circumstances we infer that there is no claim that Mr Royston was incapable of providing answers and there is no evidence that this in fact was the case.
The appellant relies upon the principles referred to in Council of the City of Greater Wollongong v Cowan (1955) 93 CLR 435 per Dixon CJ at 444 wherein his Honour referred to the circumstances in which a new trial should be ordered, namely a miscarriage because of “misdirection, misreception of evidence, wrongful rejection of evidence or other error”.
In CDJ v VAJ (1998) 197 CLR 172, however, the High Court held (at 198) that, “[t]o regard Wollongong Corporation … as defining the jurisdiction or controlling the discretion to admit evidence in statutory appeals is erroneous”. The provisions for appeal to this court are relevantly identical to those considered by the High Court in that case.
See also Sobey v Nicol and Davies (2007) 245 ALR 389 where the Full Court of the Federal Court (consisting of Branson, Lindgren and Besanko JJ) held (at 403) that “the circumstances in which further evidence may be received in this court on appeal are not limited by the principles laid down in authorities such as Greater Wollongong City Council v Cowan (1955) 93 CLR 435 …”. As the statutory provision for appeals to this Court are relevantly identical to those which regulate appeals in the Federal Court, the same position applies.
The Court in Sobey v Nicol and Davies also (at 403-404) cited with approval the observation of Gibbs CJ and Wilson, Brennan and Dawson JJ in Coulton v Holcombe (1986) 162 CLR 1 at 7:
It is fundamental to the due administration of justice that the substantial issues between the parties are ordinarily settled at the trial. If it were not so the main arena for the settlement of disputes would move from the court of first instance to the appellate court, tending to reduce the proceedings in the former court to little more than a preliminary skirmish.
The High Court held in CDJ v VAJ (at 200-204) that the power to admit further evidence was discretionary and that a critical factor was “the subject matter of the proceedings with which the appeal [was] concerned”. Further, “factors such as finality, discoverability of the evidence and its likely effect on the orders made are usually relevant to the exercise of the discretion”.
The High Court accepted that it was not an unfettered discretion, but the discretion will be exercised where “that evidence, if accepted, would demonstrate that the order under appeal is erroneous. The power exists to facilitate the avoidance of errors which cannot be otherwise remedied by the application of the conventional appellate procedures”.
The High Court continued:
Ordinarily, where it is alleged that the admission of new evidence requires a new trial, justice will not be served unless the Full Court is satisfied that the further evidence would have produced a different result if it had been available at the trial. Without that condition being satisfied, it could seldom, if ever, be in the interests of justice to deprive the respondent of the benefit of the orders made by the trial judge and put that person to the expense, inconvenience and worry of a new trial.
The High Court suggested that evidence which is not in dispute and which a court can evaluate and take into account without the necessity of a rehearing will be readily admitted. The discretion must, of course, be exercised judicially. That the evidence has been deliberately withheld will ordinarily weigh heavily against the exercise of the discretion to admit it.
It is clear from these authorities that relevant factors to be considered when an application is made to receive further evidence on appeal include:
· the reasons why the further evidence was not adduced at trial;
· the steps taken or which could have been taken to have the further evidence available at trial; and
· whether the admission of the further evidence would have had an effect on the outcome of the trial.
The Court observes that although the precise identification of the disability of Mr Royston, namely dyslexia, may not have been known until June 2008, Mr Royston was already aware, prior to the hearing, that he had difficulty in answering long questions. This fact was also known to his legal advisers since Mr Royston had provided notification to them of this fact. Such fact was also known by the Court, because Mr Royston alerted those questioning him that he had difficulty answering certain questions. Thus, it seems that the only reason why evidence of Mr Royston’s diagnosis was not adduced at trial was that a proper medical diagnosis of his recognised disability had not been sought, and there has been no suggestion that there was before the trial any obstacle to seeking such a diagnosis.
As to whether admitting the further evidence would have affected the outcome of the trial, we are not satisfied that Mr Royston was unable to cope with the questions asked of him and to provide answers to them. A reading of the transcript reveals that Mr Royston was able to answer the questions asked of him. Where Mr Royston was experiencing difficulty with answering a long question, he made such difficulty known.
Apart from those instances when Mr Royston made comment that he was experiencing such problems, there is no other occasion when we can discern from the transcript that he was experiencing difficulty in answering questions. We therefore conclude that the medical evidence sought to be placed before the Court by way of fresh evidence did not affect Mr Royston’s ability to provide answers to the questions asked of him. Critically, as has already been referred to, we observe that it is not suggested that any answers Mr Royston gave were erroneous or that he sought to withdraw or add to his testimony. It follows that it simply could not be said that the fresh evidence would, if it had been adduced at first instance, have led to the opposite result, even ignoring the shortcomings in the form of the evidence and related questions concerning its admissibility.
Furthermore, given that Mr Royston’s difficulties had been brought to the attention of the Master, there is no reason to believe that the Master, in making his finding about Mr Royston’s credibility, was influenced by the aspects of Mr Royston’s manner of giving evidence that arose from those difficulties.
For the above reasons we are satisfied that the application to adduce further evidence should be dismissed with costs.
THE APPEAL
The appellant appeals from the judgment of Master Harper delivered on 7 March 2008 in which the Master ordered that judgment be entered for the plaintiff (respondent) against the first defendant (appellant) in the sum of $736,951.29; that judgment be entered for the second defendant (Mr Royston); and that the counter claim by the first defendant be dismissed.
The Amended Notice of Appeal raises numerous grounds of appeal, several of which were not pressed at the hearing. At this point there are only two grounds of appeal relied upon by the appellant.
The first ground relates to the refusal of the Master to permit the appellant to amend its defence, following the conclusion of the hearing, to allege that the respondent should have been found to have been in breach of its contract with the appellant because of a failure to wholly fulfil orders for the supply of films.
The second ground claimed that the Master had erred in finding that the respondent had “acted reasonably in its attempts to mitigate its loss”.
AMENDMENT TO THE PLEADINGS
The hearing before the Master concluded on 5 July 2007. Approximately six weeks after the trial had concluded, namely on 17 August 2007, the appellant by application dated 7 August 2007 applied to Master Harper to amend its defence. Such application was made pursuant to r 502 of the Rules which authorises the Court to grant leave to amend any pleadings at any “stage of a proceeding”. Rule 507 of the Rules was also relied upon and such provision authorises leave to be granted to amend pleadings after the close of pleadings.
The proposed amendment to the defence would have led, if granted, to the addition of a paragraph in the amended defence as follows:
The defendants further say that only approximately 56% of Private Brand VHS tapes ordered by him [sic] were delivered by the plaintiff. This constitutes a repudiation of any agreement between the plaintiff and the first defendant, or alternatively a fundamental breach of any such agreement. The plaintiff terminated the agreement on 23 May 2005. The plaintiff is thereby estopped from relying on any later alleged breach by the defendants, or alternatively it would be inequitable for the plaintiffs to rely on any such alleged breach.
The appellant submits that it is a fundamental principle of justice that leave should be granted to amend a pleading where it is necessary in order for the Court to adjudicate upon the real issue between the parties and that even after the close of evidence and following reservation of judgment, leave may be granted. The appellant submits that there are authorities to support such a proposition and relies upon Londish and Others v Gulf Pacific Pty Limited (1993) 45 FCR 128 at 139-144; North Australian Aboriginal Legal Aid Service Incorporated v Liddle (1994) 118 FLR 109 at 119-120; The State of Queensland and Another v JL Holdings Pty Limited (1997) 189 CLR 146 at 154-155 (Dawson, Gaudron and McHugh JJ) and at 164-170, 172 (Kirby J); and Equuscorp Pty Ltd (formerly Equus Financial Services Ltd) v Lah and Others [1999] ACTSC 87 at [11]-[13].
The appellant submits that the Rules of the Court are designed to ensure that justice is done as between the parties and that his Honour erred in refusing the amendment because of his failure to consider that the interests of justice required that he allow the appellant to amend the pleadings. It is submitted that it was necessary for such amendment to have been allowed so that the issues between the parties could be determined. It is claimed that there was no prejudice to the respondent in allowing the amendment since evidence in support of the ground had been led at the trial and that the proposed amendment merely raised, by way of pleadings, matters that had been dealt with by the evidence. Secondly, the appellant submits that any prejudice to the respondent by reason of the grant of the amendment could have been remedied by an order for costs or an order permitting the respondent to file a reply. Thirdly, it is submitted that his Honour “misconceived the matter and his discretion miscarried”.
Finding
Pursuant to r 502 and r 507 of the Rules the decision by Master Harper to refuse to permit an amendment of the defence was made in the exercise of his discretion. In accordance with the principle in House v The King (1936) 55 CLR 499 at 504-505 it must be shown that there has been some error made in the exercise of that discretion before an appeal will be allowed from it. Such errors will include acting upon a wrong principle; allowing extraneous or irrelevant matters to affect the decision; mistaking the facts; and failing to take into account a material consideration. If such factors exist the decision ought be reviewed. Alternatively if it is found that the method by which the decision was reached is not clear or that it is unreasonable or plainly unjust on the facts, the Court may review the decision. As was observed by the High Court in that decision at 504-505:
It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course.
In giving his reasons for rejecting the application Master Harper noted the delay on the first defendant’s part in bringing the application. His Honour observed that two weeks after the submissions had been concluded the solicitors for the defendants made the application to deliver a further amended defence. Such application was supported by an affidavit sworn by Mr Barker. He deposed that he had originally been instructed that the plaintiff had delivered 94% of the tapes which had been ordered, such figure being calculated from the plaintiff’s invoices delivered with the tapes. However, he said that on 4 July 2007 (namely the second last day of the hearing), he had conferred with both defendants and counsel and in consequence found that only 56% of the ordered tapes had in fact been supplied. Mr Barker then submitted that the failure to deliver 44% of the tapes amounted to repudiation or a breach of the agreement between the plaintiff and the first defendant. Despite the fact that the hearing was then continuing, the suggestion that there was substantial shortfall in the number of delivered tapes was not raised before the Court, and the hearing proceeded upon the basis that the shortfall was de minimis.
The Master observed that no other evidence was filed, for example by Mr Royston, explaining why he did not raise the issue of the shortfall in orders earlier, and that although the case proceeded on the following day (namely 5 July 2007) no evidence was elicited from Mr Royston, who was still giving evidence in chief, to suggest that the issue raised by the proposed amendment would be raised.
Further, his Honour noted that such claim, namely that there was a shortfall of deliveries, was in contradiction to the way that the proceedings had been conducted by both parties and that therefore no such claim had ever been put to any of the witnesses of either the plaintiff or defendant. Consequently, as his Honour observed, and this has been accepted before this Court by the appellant’s counsel, allowing the proposed amendment of the defence would have required a complete rehearing.
No error in the exercise of discretion akin to those mentioned in House v The King has been identified by the appellant. Rather, the appellant relies on the argument that such amendment should be granted where it is in the interests of justice to do so. However, the authorities cited by the appellant in favour of this contention (mentioned at [42] above) do not suggest that such amendment is a matter of right, nor that there are no considerations that may disentitle a party seeking such amendment from being granted the required leave.
In particular, the authorities cited by the appellant highlight that such amendment should not be allowed where injustice would be caused to the other party and where there is some behaviour on the part of the party seeking amendment which should disentitle it from being able to amend its pleadings, keeping in mind that such refusal should not be used to punish the party seeking amendment.
There was clear evidence before the Master that allowing the amendment sought by the appellant would have caused substantial injustice to the respondent. As already stated, the amendment sought was completely at odds with the way the trial was conducted, and allowing the amendment would have effectively required a rehearing based upon an entirely different defence.
The appellant submits that such injustice could have been overcome by a costs order. However, that submission assumes that the only injustice that would result would be greater legal fees. Such submission ignores the injustice resulting from further delay and from the substantial inconvenience to the witnesses involved in the litigation in being brought back for further examination and cross-examination. Based upon a different defence, the proceedings might require entirely different evidence and submissions.
Further, there was evidence before the Master, as observed above, that the conduct of the appellant in seeking the amendment was less than satisfactory. Mr Royston informed his counsel, who was also acting for the appellant, of the allegation about the respondent’s failure to deliver a substantial minority of the videos ordered before his examination in chief had concluded, that is, on 4 July 2007. However, counsel for the appellant did not indicate that the allegation had been made known to the legal advisers, and did not seek to adduce such evidence from Mr Royston while the trial continued for its last day on 5 July 2007. Nor was the claim raised during the period for written submissions following the conclusion of the trial. Mr Royston gave no affidavit explaining why he only informed his counsel of such claim on 4 July 2007 and why the trial proceeded on the assumption that any shortfall of deliveries was de minimis.
The Court is empowered to amend a party’s pleading at any stage of the proceedings. However, the exercise of such power is entirely discretionary: see Londish v Gulf Pacific at 139-144. See also the decision of McHugh, Gummow and Callinan JJ in CDJ v VAJ at [104]-[105] and [149] relating to the provisions of s 93A(2) of the Family Law Act 1975 (Cth), and in Liddle at 118-121.
In this instance the appellant sought to make out an entirely different basis for the proposed amended defence when compared to that raised and argued before the Master. In circumstances where the change in the appellant’s proposed conduct of the proceedings had not been satisfactorily explained, and where, if permitted, substantial inconvenience and delay would result, the Master was correct to refuse the appellant’s application: see Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 at [33], [90]-[93]. At [102] Gummow, Hayne, Crennan, Kiefel and Bell JJ said:
There may be cases where it may properly be concluded that a party has had sufficient opportunity to plead their case and that it is too late for a further amendment, having regard to the other party and other litigants awaiting trial dates. Rule 21 makes it plain that the extent and the effect of delay and costs are to be regarded as important considerations in the exercise of the court's discretion. Invariably the exercise of that discretion will require an explanation to be given where there is delay in applying for amendment.
Throughout the conduct of the pleadings and the hearing the appellant conducted its case upon the basis of a defence which is not only inconsistent with, but is diametrically opposed to, that which was sought to be raised by the amended defence. It is stretching credulity to suggest that the appellant merely made an innocent mistake in failing to raise such a radically different defence earlier.
The Court also considers that even if the proposed amended defence had merit (a question which is considered hereunder) the withholding of such defence is tantamount to improper concealment as referred to by Martin CJ in Liddle at 118-119 when his Honour said:
The pleading envisaged should have been allowed unless it appeared that injustice would thereby have been occasioned to the plaintiff, there being nothing to suggest fraud or improper concealment of the defence on the part of the defendant.
No question arises of “punishing” the appellant if this application is rejected (see JL Holdings Pty Limited at 155) since the Court is not satisfied that the appellant was labouring under any mistaken belief about any relevant matter.
Further, as became apparent during the hearing of the appeal, even if the amendment were allowed, the documentary evidence that there was in fact a shortfall of deliveries is threadbare and uncertain at best. Indeed, on the documents put before the Court of Appeal by the appellant, it appeared that there was virtually no shortfall of deliveries at all. Therefore, the oral evidence of Mr Royston would in a rehearing have been the only evidence that a shortfall of deliveries of approximately one half occurred. However, as mentioned at [8] above, the learned Master was disinclined to believe Mr Royston’s testimony absent corroborating evidence.
It follows that even if the Court were to ignore the substantial injustice that might result to the respondent were the amendment to be made, and the less than satisfactory behaviour of the appellant in seeking such amendment, the evidence as put before this Court simply does not support the claim that there was a meaningful shortfall in the delivery of VHS tapes. We consider that the proceedings before the Master were conducted upon the correct assumption that any shortfall in deliveries was de minimis.
Accordingly, the Court dismisses the challenge to the Master’s refusal of leave to amend the pleadings.
MITIGATION ISSUE
Findings
By the appellant’s counsel’s own admission, the defence to the statement of claim did not raise as an issue that the respondent had failed to mitigate its loss, no cross-examination had been directed to any of the witnesses for the respondent on this issue, and the appellant did not adduce any evidence before the Master that the respondent had failed to mitigate its loss. Therefore, there was no evidence before the Master on this issue because it was never raised as an issue. Nor is there any before this Court. The claim is accordingly without merit and is therefore dismissed.
GENERAL COMMENTS
The Court was in general not impressed by the conduct of the appellant’s case. Evidence sought to be adduced was not provided in the correct form. When this was pointed out at the beginning of the hearing, counsel for the appellant sought an adjournment to enable him to provide the material in admissible form. He then sought further adjournments as the hearing proceeded, in each case apparently to engage in preparatory work that should have been undertaken well before the hearing, the date for which had been set several months earlier. The appeal grounds arose either from investigations begun only after the notice of appeal had been lodged (namely Mr Royston’s medical consultations), or from claims that were initially made in an affidavit sworn in August 2007, several weeks after the end of the trial, and that had not apparently been the subject of any further effort (specifically, to generate from large volumes of business records any kind of meaningful information that could have been given in evidence) between the swearing of that affidavit in August 2007 and the hearing of the appeal in May 2009.
In short, the presentation of the appellant’s appeal ensured that to the extent that the appeal had any merit, it was not led before the Court in a convincing way.
I certify that the preceding sixty-three (63) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Court.
Associate:
Date: 4 March 2010
Counsel for the Appellant: Mr R Thomas
Solicitors for the Appellant: Trevor Barker & Associates
Counsel for the Respondent: Mr JM Hennessy
Solicitors for the Respondent: Clayton Utz
Date of hearing: 5-6 May 2009
Date of judgment: 4 March 2010
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