The Nominal Defendant v Roxwood Downs Pty Ltd

[2025] NSWSC 537

Supreme Court

New South Wales

Medium Neutral Citation:

The Nominal Defendant v Roxwood Downs Pty Ltd [2025] NSWSC 537

Hearing dates:

21 May 2025

Date of orders:

28 May 2025

Decision date:

28 May 2025

Jurisdiction:

Common Law

Before:

Schmidt AJ

Decision:

(1)   Roxwood and the Council have leave to file their amended defences.

(2)   If either Roxwood or the Council wish to be heard against an order that they should bear the Nominal Defendant’s costs thrown away as the result of the leave they have been granted, they should approach within 7 days with short written submissions.

(3)   Otherwise the costs order will be that Roxwood and the Council should bear the Nominal Defendant’s costs thrown away as the result of the leave they have been granted.

(4)   The parties should confer about the further orders which Chen J should be asked to make as a result of the leave granted.

(5)   Leave granted to the First Defendant to file and serve an Amended Statement of Cross Claim (being the Third Cross-Claim in the proceedings) naming Certain Underwriters at Lloyds subscribing to contract B0723FN02483A16 as the Cross-Defendant to the Third Cross-Claim), by 4 June 2025.

(6)   Leave granted to the First Defendant to file a further amended statement of cross-claim (in relation to the first-cross claim) by 4 June 2025.

Catchwords:

CIVIL PROCEDURE – application for leave to amend defence – application to withdraw admissions claimed to be made as a result of a mistake and to plead further defences – where leave to amend will not result in delay, wasted costs, irreparable unfair prejudice or adjournment of trial – leave to withdraw admissions and amend defence granted

CIVIL PROCEDURE – application to amend cross claim – amendments not opposed from grant of leave – leave granted

Legislation Cited:

Civil Procedure Act 2005 (NSW)

Law Reform (Miscellaneous Provisions) Act 1946 (NSW)

Motor Accidents Compensation Act1999 (NSW)

Road Transport Act 2013 (NSW)

Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

Aon Risk Services Pty Ltd v Australian National University (2009) HCA 29: (2009) 239 CLR 175

Coopers Brewery Ltd v Panfida Foods Ltd (1992) 26 NSWLR 738

Drabsch [v Switzerland General Insurance Co Ltd (Supreme Court (NSW), 16 October 1996, unrep)

Kelly v Mina [2014] NSWCA 9

Khouri v National Australia Bank Ltd [2007] NSWSC 987

Maile v Rafiq [2005] NSWCA 410

Namberry Craft Pty Ltd v Watson [2011] VSC 136

Category:

Principal judgment

Parties:

The Nominal Defendant (Plaintiff)
Roxwood Downs P/L (First Defendant/First Cross-Claimant)
Lake Macquarie City Council (Second Defendant/Second Cross-Claimant)
Surf Life Saving New South Wales (Third Defendant/Third Cross-Claimant

Representation:

Counsel:
B Jones (Plaintiff)
E Anderson (First Defendant)
T Smartt (Second Defendant)

Solicitors:
Sparke Helmore (Plaintiff)
Taylor Splatt & Partners (First Defendant/First Cross-Claimant)
Moray & Agnew (Second Defendant/Second Cross-Claimant))
Barry Nilsson Lawyers (Third Defendant/Third Cross-Claimant)

File Number(s):

2022/348305

Publication restriction:

Nil

JUDGMENT

1. In 2022 the Nominal Defendant brought proceedings against Roxwood Downs Pty Ltd, the Council and the charity Surf Life Savings NSW, seeking recovery of payments it had made under the Motor Accidents Compensation Act 1989 (NSW), in relation to a March 2017 accident near Blacksmiths Beach in which a Mr Burge was injured by an all-terrain vehicle driven by a Mr Anderson.

2. The Council had permitted NSW Surf to conduct the NSW Surf Titles at the beach. The vehicle struck Mr Burge in or adjacent to a car park then open to and being used by the public. Mr Burge later successfully pursued a claim in respect of his injuries, the Nominal Defendant having made various admissions and agreed to settle his claim for $1,850,000 inclusive of legal costs. It also incurred costs and expenses of some $47,000 in investigating his claims and making the agreement.

3. It is common ground that at the time of the accident the vehicle was not registered under the Road Transport Act 2013 (NSW), nor insured for the purpose of the Motor Accidents Compensation Act1999 (NSW).

4. In these proceedings the Nominal Defendant claims that Roxwood owned the vehicle, which it had rented to the Council, who had provided it to be used by Surf Life Saving. It pursues all three defendants as being jointly or concurrently the owners of the vehicle under s 4 of the Motor Accidents Compensation Act, against whom it is entitled to recover what it paid Mr Burge: s 39.

5. The claims are defended and cross claims are also pursued.

6. This judgment deals with two motions. The first brought by Roxwood, which in essence sought leave to:

1. Withdraw admissions which it claims were made as the result of a mistake and to also amend its defence;

2. Amend a cross claim to name the correct insurer, and

3. Further amend its cross claim in order to also pursue damages for breach of contract and indemnity and/or contribution under s 5 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW).

7. The second motion was brought by the Council, which also seeks to withdraw admissions it had earlier made about the ownership of the vehicle.

8. The motions were supported by affidavits sworn by Mr Dewson, Roxwood’s director, Ms Humphreys-Grey, its solicitor and Ms Williams, the Council’s solicitor.

9. The leave sought to withdraw the admissions and amend the defences was opposed, despite it emerging that there was no issue that the vehicle had not been registered to Roxwood, but to another company.

10. Agreement was reached between the defendants about amendments to the cross claims, about which the Nominal Defendant did not wish to be heard and to which the proposed defendant insurer neither consented nor opposed. In those circumstances I am satisfied that the consent orders agreed should be made.

11. Regrettably other common ground was not reached. Remaining in issue was whether leave would be given to withdraw admissions and to amend the defences.

Ownership of the vehicle

12. There is no issue about the Court’s power to grant the leave sought to amend the pleadings, including as to admissions about ownership of the vehicle, or the applicable principles. Or that what is in issue must be approached in light of the applicable requirements of the Civil Procedure Act 2005 (NSW).

13. The statement of claim pleads that the vehicle was owned by Roxwood and provided to the Council under a February 2017 rental agreement between it and the Council. That was admitted by Roxwood and the Council also admitted Roxwood’s ownership but denied having rented it. By its amended defence Roxwood put ownership of the vehicle in issue, but in the alternative, if found to have owned the vehicle, admitted renting it to the Council.

14. Rule 12.6 of the Uniform Civil Procedure Rules 2005 (NSW) permits leave to be granted to withdraw admissions. It is ordinarily granted where it is shown that an admission was contrary to the actual facts: Maile v Rafiq [2005] NSWCA 410 at [77].

15. But where a party under no apparent disability makes a clear and distinct admission which is accepted by its opponent and acted upon, for reasons of policy and the due conduct of the business of the court, an application to withdraw the admission should not be freely granted: Coopers Brewery Ltd v Panfida Foods Ltd (1992) 26 NSWLR 738 discussed in Drabsch [v Switzerland General Insurance Co Ltd (Supreme Court (NSW), 16 October 1996, unrep). See also Khouri v National Australia Bank Ltd [2007] NSWSC 987. Some good reason why what was previously common ground or conceded should thus be provided.

16. Section 56 of the Civil Procedure Act must also be taken into account, it imposing a duty on the Court to seek to give effect to the overriding purpose there specified when it exercises its powers, namely, “to facilitate the just, quick and cheap resolution of the real issues in the proceedings”. Section 57 requires the Court to manage the proceedings having regard to specified objects, namely:

“(a) the just determination of the proceedings,

(b) the efficient disposal of the business of the court,

(c) the efficient use of available judicial and administrative resources,

(d) the timely disposal of the proceedings, and all other proceedings in the court, at a cost affordable by the respective parties.”

17. Section 58(1) requires the Court to “seek to act in accordance with the dictates of justice” in deciding whether to make any order in the management of proceedings, including any order for the amendment of a document. In doing so it must have regard to ss 56 and 57, and may also have regard to the matters specified in s 58(2)(b), to the extent they are relevant. They are:

“(i) the degree of difficulty or complexity to which the issues in the proceedings give rise,

(ii) the degree of expedition with which the respective parties have approached the proceedings, including the degree to which they have been timely in their interlocutory activities,

(iii) the degree to which any lack of expedition in approaching the proceedings has arisen from circumstances beyond the control of the respective parties,

(iv) the degree to which the respective parties have fulfilled their duties under section 56(3),

(v) the use that any party has made, or could have made, of any opportunity that has been available to the party in the course of the proceedings, whether under rules of court, the practice of the court or any direction of a procedural nature given in the proceedings,

(vi) the degree of injustice that would be suffered by the respective parties as a consequence of any order or direction,

(vii) such other matters as the court considers relevant in the circumstances of the case.”

18. In Kelly v Mina [2014] NSWCA 9 it was held that as well as these statutory provisions account must be taken of “a combination of factors identified by the High Court in Aon Risk Services Pty Ltd v Australian National University (2009) HCA 29: (2009) 239 CLR 175 and usefully summarised by Vickery J in Namberry Craft Pty Ltd v Watson [2011] VSC 136 (at [38])”: at [47]. Namely:

"(a) Whether there will be substantial delay caused by the amendment;

(b) The extent of wasted costs that will be incurred;

(c) Whether there is an irreparable element of unfair prejudice caused by the amendment, arising, for example, by inconvenience and stress caused to individuals or inordinate pressures placed upon corporations, which cannot be adequately compensated for, whatever costs may be awarded;

(d) Concerns of case management arising from the stage in the proceeding when the amendment is sought, including the fact that the time of the court is a publicly funded resource, and whether the grant of the amendment will result in inefficiencies arising from the vacation or adjournment of trials;

(e) Whether the grant of the amendment will lessen public confidence in the judicial system; and

(f) Whether a satisfactory explanation has been given for seeking the amendment at the stage when it is sought."

19. The question of the exercise of the Court’s discretion to grant the leave sought arises to be considered in circumstances where the statement of claim did not give particulars of the vehicle’s registration, even though it was identified in various documents, including a police report.

20. Roxwood entered its defence, admitting ownership of the vehicle, in December 2022, in circumstances where it had rented the Council three vehicles for use at the Titles. Documents later established the registration number of the vehicle involved in the accident, which had been registered to Colour Run Pty Ltd, not Roxwood. Its case is that it never owned the vehicle involved in the accident, but had rented vehicles with different registration numbers to the Council.

21. Roxwood filed its amended defence in February 2023, denying that it was the owner of the vehicle and in the event that it was found that it had been the owner and that the vehicle had been uninsured, making admissions both as to its ownership and the lease of the vehicle to the Council.

22. In its March 2023 defence, the Council admitted Roxwood’s ownership of the vehicle, but denied that it had rented that vehicle.

23. Despite ongoing discussions, amendment of the defences was not consented to.

24. Roxwood and the Council contended that the leave they required would be granted, the parties having been aware of the issue about ownership since February 2023 and justice not permitting the hearing to proceed on mistaken admissions. To unjustly proceed on a false factual substratum would be contrary to the intent of the Civil Procedure Act 2005 (NSW).

25. The Nominal Defendant argued that:

1. There was no evidence which explained the circumstances in which the defences were filed, instructions were given or which established that any mistake had been made;

2. Its case does not turn on the registration number of the vehicle, but photographs of it in situ after the accident which show that it was decked in “Patons” livery, that being Roxwood’s trading name, about which Mr Burge would also be called to give evidence and a director of Patons having subsequently provided the service records of the ATV involved in the accident;

3. The Council filed its defence knowing that Roxwood denied ownership of the vehicle and it could not reasonably have expected that some two years later, leave to withdraw the Council’s admissions would be pursued;

4. Evidence about ownership of the vehicle will be judged by reference to the parties’ ability to produce it;

5. What Roxwood now seeks to plead also raises defences not earlier relied on, without any explanation, absent which the leave sought should not be granted; and

6. If it was granted the Nominal Defendant had to be given further time to adduce evidence about the new matters Roxwood raised, in circumstances where the relevant events occurred more than 8 years ago, that strongly favouring the rejection of the application.

26. The Nominal Defendant also contended that neither defendant should be permitted to withdraw their admissions or amend their pleadings for purely strategic reasons. And that the proposed amendments had not all been pleaded in accordance with the requirements of the Rules, necessary particulars not having been given.

27. I am satisfied that the evidence establishes that Roxwood’s original defence was entered on the mistaken assumption that the vehicle involved in the accident was one of those it had hired to the Council. The error came to light when particulars of the vehicle were sought and the Nominal Defendant provided the registration number.

28. The Nominal Defendant was informed of the mistaken admission soon afterwards and investigations were pursued which established that the vehicle had not been registered to Roxwood. Despite this, its amended defence oddly pleaded in the alternative, that if it was found to have owned the vehicle, then it having rented it to the Council was admitted. While for its part the Council admitted Roxwood’s ownership of the vehicle, but denied having rented it from Roxwood.

29. The defences are contradictory. Despite the parties’ communications, the Nominal Defendant refused to consent to the withdrawal of the admissions and their amendment. That necessitating the applications for the Court’s leave, which still did not generate the Nominal Defendant’s consent.

30. I consider that the proposed withdrawal of the admissions about ownership and the rental of the vehicle are not pursued for purely strategic reasons and that refusal to grant leave to amend does not appear to accord with the obligations imposed by s 56 of the Civil Procedure Act. Nor is that supported by the other considerations which arise under that Act, or those discussed in Aon.

31. That is because I cannot see that the grant of the Court’s leave to amend will result in any delay, that wasted costs are likely to be incurred, that there will be irreparable unfair prejudice caused by inconvenience and stress or the waste of court time or the vacation or adjournment of the trial. The grant of the amendment seems to me likely to increase, rather than lessen public confidence in the judicial system.

32. That is because the pleadings ought to reflect that the vehicle involved in the accident was not ever registered to Roxwood and that there is a real issue about Roxwood having rented it to the Council. If the disputed admissions are not permitted to be withdrawn and the defences amended, the risk is that the matter will go to trial on a mistaken factual basis.

33. Given the state of the current defences, that there will be real adverse consequences for the Nominal Defendant, is difficult to see. Neither defendants seek leave to lead further evidence and the Nominal Defendant has time to put on further evidence before the hearing, from the driver of the vehicle and the injured person for example, if that is required.

34. In the result I am satisfied that the leave sought in relation to the withdrawal of admissions and the resulting amendment of the defences must be given.

The pleading of further defences

35. Roxwood’s proposed amendments also seek to plead new defences, relying on s 39 of the Motor Accidents Compensation Act, as well as on terms of the rental agreement. The defence’s evidence has been served and Roxwood and the Council do not seek leave to lead more, if they are permitted to amend their pleadings.

36. The new defences turn on provisions of s 39 and the terms of the rental agreement which the parties will have to address in any event, given the claims advanced. Given the parties’ dealings with each other and the evidence which has already been served, I do not accept that the Nominal Defendant is taken by surprise by the amendments pursued.

37. It does appear that the amendments may result in the Nominal Defendant wishing to put on further evidence. But the hearing is not fixed until September, and the matter is listed before Chen J for further directions on Friday next, when any further timetabling can sensibly be dealt with, including as to the provision of any particulars and the service of further evidence.

38. It is thus not obvious that any delay will result from the grant of the leave to add the disputed defences. Wasted costs, which do not seem likely, can justly be dealt with by a costs thrown away order in favour of the Nominal Defendant.

39. I am thus satisfied that justice also requires that leave to pursue the other amendments to the defences should be given.

Costs

40. The usual order under the Rules is that costs follow the event, which on these motions is an order that the Nominal Defendant bear the costs of the motions. The Nominal Defendant contended, however, that in all of the circumstances even if the leave sought were granted, a costs order should be made in its favour.

41. If either Roxwood or the Council wish to be heard against an order that they should bear any of the Nominal Defendant’s costs thrown away as the result of the leave they have been granted, they should approach within 7 days with short written submissions.

Orders

42. For these reasons I order that:

1. Roxwood and the Council have leave to file their amended defences.

2. If either Roxwood or the Council wish to be heard against an order that they should bear the Nominal Defendant’s costs thrown away as the result of the leave they have been granted, they should approach within 7 days with short written submissions.

3. Otherwise the costs order will be that Roxwood and the Council should bear the Nominal Defendant’s costs thrown away as the result of the leave they have been granted.

4. The parties should confer about the further orders which Chen J should be asked to make as a result of the leave granted.

5. Leave granted to the First Defendant to file and serve an Amended Statement of Cross Claim (being the Third Cross-Claim in the proceedings) naming Certain Underwriters at Lloyds subscribing to contract B0723FN02483A16 as the Cross-Defendant to the Third Cross-Claim), by 4 June 2025.

1. Leave granted to the First Defendant to file a further amended statement of cross-claim (in relation to the first-cross claim) by 4 June 2025.

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Decision last updated: 28 May 2025