The Owners - Unit Plan No 4421 v Geocon Constructors (ACT) Pty Ltd

[2024] ACTSC 422

SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title:

The Owners – Unit Plan No 4421 v Geocon Constructors (ACT) Pty Ltd

Citation: 

[2024] ACTSC 422

Hearing Date: 

2 August 2024

Decision Date: 

2 August 2024

Before:

Loukas-Karlsson J

Decision: 

(1)    Mr Darren Sault is joined as the fourteenth defendant in this proceeding.

(2)    The Plaintiff is granted leave to file an amended statement of claim within 7 days.

(3)    Mr Darren Sault is to file a notice of appointment of solicitor within 7 days.

(4)    The matter is listed for directions before the Registrar on Monday, 12 August 2024 at 9.30am.

(5)    All parties are granted leave to file written submissions on costs.

Catchwords: 

CIVIL – PRACTICE AND PROCEDURE – application to amend claim – application of plaintiff to join a further defendant –- fourteenth defendant – rr 220, 242 and 502 of the Court Procedures Rules – uncertainty of parties as to applicable rule for application – limitation period issue – inappropriate stage of proceedings to resolve limitation period issue

Legislation Cited: 

Building Act 2004 (ACT)

Competition and Consumer Act 2010 (Cth), Sch 2

Court Procedures Act 2004 (ACT) s 5A

Court Procedures Rules 2006 (ACT) rr 220, 242 and 502

Evidence Act 2011 (ACT) s 75

Limitation Act 1985 (ACT) s 40

Unit Titles (Management) Act 2011 (ACT) s 8(1)

Cases Cited: 

Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; 239 CLR 175

Beta ACT Pty Ltd as Trustee for the Brendas Family Trust v FTI Consulting Pty Ltd [2021] ACTSC 293

DPP v Martin [2014] ACTSC 104; 9 ACTLR 1

Edgecock v Minister for Child Welfare [1971] 1 NSWLR 751

Eshelby v Federated European Bank Ltd [1932] 1 KB 254

Foldi v Lloyd [2011] ACTSC 17

Gibbons v Westminster Bank Ltd [1939] 2 KB 882

John Holland (Constructions) Pty Ltd v Jordin (No 2) (1985) 36 NTR 1

Naidu v Fergusson [2013] ACTSC 208; 8 ACTLR 150

News Ltd v Australian Rugby Football League Limited (1996) 64 FCR 410

Philip Morris Ltd v Bridge Shipping Pty Ltd [1994] 2 VR 1

The Owners - Units Plan No 1917 v Koundouris [2014] ACTSC 269

The Owners – Units Plan 3550 v BCA Certifiers Australia Ltd [2021] ACTSC 3

Qantas Airways Ltd v AF Little Pty Ltd [1981] 2 NSWLR 34

Wardley Australia Ltd v Western Australia (1992) 175 CLR 514

Texts Cited:

LexisNexis Butterworths, Civil Procedure ACT, vol 1 (at Service 146)

Cyril Northcote Parkinson, ‘Parkinson’s Law’, The Economist (London, 19 November 1955)

Parties: 

The Owners – Units Plan No 4421 ( Applicant / Plaintiff)

Geocon Constructors (ACT) Pty Ltd ( First Defendant)

NG Landholdings No.1 Pty Ltd ( Second Defendant)

ACN 119 755 734 Pty Ltd ( Third Defendant)

Vital Design Solutions Pty Ltd ( Fourth Defendant)

Northrop Consulting Engineers Pty Ltd ( Fifth Defendant)

O’Neill & Brown Fire Services Pty Ltd ( Sixth Defendant)

O’Neill & Brown Plumbing Company Pty Ltd ( Seventh Defendant)

Dysen Pty Ltd ( Ninth Defendant)

Compendium Design Pty Ltd ( Tenth Defendant)

Magnate Tiling Pty Ltd ( Eleventh Defendant)

All Things in Concrete Pty Ltd t/as TLC Pumping Pty Ltd & Prestige Pools ( Twelfth Defendant)

Nikolaos Georgalis (Thirteenth Defendant)

Darren Sault ( Respondent/Fourteenth Defendant)

Representation: 

F Corsaro SC ( Applicant/Plaintiff)

D Buckley ( First, Second and Thirteenth Defendant)

T McElhenny ( Third Defendant)

J Stacey ( Fourth Defendant)

M Webster ( Fifth Defendant)

C Tran ( Sixth Defendant)

C Lopez Maspes ( Seventh Defendant)

M Wilcox ( Ninth Defendant)

B Ness ( Tenth Defendant)

D Daniel ( Eleventh Defendant)

No appearance ( Twelfth Defendant)

J Moffett ( Respondent/Fourteenth Defendant)

Solicitors

Chambers Russell (Applicant/Plaintiff)

Minter Ellison (First, Second and Thirteenth Defendant)

Lander & Rogers (Third Defendant)

Kennedys (Fourth Defendant)

Hall & Wilcox (Fifth Defendant)

Gilchrist Connell (Sixth Defendant)

Wotton + Kearney (Seventh Defendant)

Sparke Helmore (Ninth Defendant)

Moray & Agnew (Tenth Defendant)

Crisp Law (Eleventh Defendant)

No appearance (Twelfth Defendant)

Thomson Geer (Respondent/Fourteenth Defendant)

File Number:

SC 506 of 2023

LOUKAS-KARLSSON J:     

Introduction

1․On 2 August 2024, I granted an application to join the respondent. Reasons were reserved. I now publish my reasons.

2․This is an application by the Owners of Units Plan No 4421 (the plaintiff) to join Mr Darren Sault to a civil proceeding. Broadly, the proceedings arise from alleged building defects. Proceedings have been commenced against a number of other defendants. For clarity, it is convenient to refer to the plaintiff and Mr Sault as the applicant and the respondent respectively.

3․The relevant application in proceeding was filed in July 2024 (the application). The application sought an order to include Mr Sault as a defendant.

4․At the hearing on 2 August 2024, I granted leave for the applicant to amend the grounds supporting the order sought, to include further provisions of the Court Procedures Rules 2006 (ACT) (CPR). The application as amended sought the orders on the following grounds:

(a)Pursuant to Rule 220 and Rule 242 and Rule 502(3) of the [CPR] the claim against the [respondent] gives rise to the same issues of law and fact as in the proceedings currently before the Court and the [respondent] ought to be a defendant in the proceedings.

(b)The [applicant] seeks an order pursuant to Rule 220 and Rule 242 and Rule 502(3) of the CPR that the [respondent] be included in the proceedings.

5․The application was supported by an affidavit of Ms Stanley of 11 June 2024 (Stanley affidavit) and an affidavit of Mr Lim of 30 July 2024 (Lim affidavit). Further, I note the relevant subrule is 502(1) as opposed to subrule 502(3) but nothing of any great significance turns on this point.

6․Further, I granted leave for the respondent to file in court two affidavits in support, being the affidavit of Ms Mulherin of 25 July 2024 (Mulherin affidavit) and the affidavit of Ms Hendry of 1 August 2024 (Hendry affidavit). Counsel for the applicant noted that he did[1] not appear to have received the Mulherin affidavit until the hearing, although counsel for the respondent submitted that both affidavits were served on the parties’ solicitors.[2] Nothing turns on this as counsel for the applicant was nevertheless content to proceed.[3]

[1] Transcript, p 31(1)-(2).

[2] Transcript, p 30(41)-(43).

[3] Transcript, p 31(39)-(41).

Background

7․The nature of the application necessitates some degree of familiarity with the applicant’s claims and a general understanding of the procedural history of the matter thus far.  At the hearing, counsel for the applicant helpfully sketched the general features of the proceedings.[4]

[4] Transcript, pp 4-9.

8․The applicant is the owners corporation of a residential unit development called “Infinity” in Gungahlin, ACT (the development), established under s 8(1) of the Unit Titles (Management) Act 2011 (ACT). On 6 December 2023, the applicant filed an originating claim and a statement of claim. The applicant pleaded that the development suffered from defects, non-complying building works, and resulting damage.[5] A preliminary Scott schedule was filed on 7 December 2023, and the original statement of claim foreshadowed that further evidence would be tendered to particularise other defects.

[5] Original statement of claim at [9].

9․At that time, relief was claimed against thirteen defendants. Counsel for the applicant noted that the defendants had “in one way or another had a part to play in the design and construction of the development”.[6] Aside from the other defendants, an eighth defendant (Sellick Consultants Pty Ltd) was then also included in the proceedings. That eighth defendant is an entity associated with the respondent.[7]

[6] Transcript, p 5 (30)-(31).

[7] Transcript, p 4(34)-(36).

10․As a result of the alleged defects, the applicant claims loss arising from the defects against the builder (the first defendant),[8] the developer[9] (the second defendant), the certifier (the third defendant) and a range of other parties concerning representations said to be made, that the development complied or will comply (compliance representations) with the following requirements:[10]

[8] Original statement of claim at [12]-[30], [42]-[62].

[9] Original statement of claim at [40].

[10] Original statement of claim at [31].

(a)Laws, construction codes, standards, and other applicable requirements that the work was required to comply with in order to be lawfully approved for occupation and use; and  

(b)The need for the work to be done to a standard of quality and suitability sufficient to permit the work to be lawfully approved for occupation and use.

11․In my view, it is not essential for the purposes of this application to reproduce in minute detail the pleadings and particulars alleged against the defendants in the original statement of claim. It is sufficient to note the following.

12․First, the claims were variously pleaded on the basis of:

(a)The Building Act 2004 (ACT), namely claims for statutory warranties[11] and statutory duties arising from that act.[12]  

[11] Original statement of claim at [12]-[20]; transcript, p 5(38)-(39).

[12] Original statement of claim at [57]-[58].

(b)Negligence.[13]

[13] Original statement of claim at [49]-[56], [63]-[72].

(c)Misleading or deceptive conduct, under s 18 of the Australian Consumer Law (ACL), found in Sch 2 of the Competition and Consumer Act 2010 (Cth).

13․Second, as pleaded and particularised the claim against the eighth defendant was made under the ACL.[14] The further particulars provided in schedule A to the original statement noted that the claims against the eighth defendant arose in respect of “structural issues, including structural elements of the swimming pool and spa.”[15] The compliance representations made by the eighth defendant were alleged to have included representations contained in the following:

[14] Original statement of claim at [31]-[38].

[15] Original statement of claim at pp 43-44.

(a)Design Check Certificate of Structural Sufficiency dated 23 January 2017.

(b)Construction Certificate of Structural Sufficiency dated 13 December 2017.

(c)Construction Certificate of Structural Sufficiency dated 19 February 2018.

14․Copies of these certificates[16] were attached as annexures to the Lim affidavit.[17] Relevantly, these certificates were signed by the respondent in his capacity as a Senior Structural Engineer and later Director of the eighth defendant.[18]

[16] See transcript, pp 7-8.

[17] Lim affidavit, annexures A-C

[18] See the certificates of December 2017 and February 2018.

15․A further procedural development occurred on 26 April 2024. On this date, the applicant filed a notice of discontinuance of claims against the eighth defendant. The Stanley affidavit recorded[19] that the applicant’s solicitor received instructions to discontinue proceedings against the eighth defendant on 23 March 2024.[20] The Stanley affidavit also affirmed that the notice of discontinuance was executed by the eighth defendant on 18 April 2024.[21]

[19] Transcript, p 11(15)-(16).

[20] Stanley affidavit at [10].

[21] Stanley affidavit at [12].

16․Separately, the Stanley affidavit detailed procedural developments in relation to the filing of an amended statement of claim. In particular, the Stanley affidavit affirmed that an amended statement of claim was filed with this Court’s registry on 2 May 2024.[22]

[22] Stanley affidavit at [18].

17․I was taken to a copy of the proposed amended statement of claim during the hearing of this application. Upon my review, the main changes proposed by the amended statement were effectively the removal of the claim against the eighth defendant and the introduction of a cause of action[23] against the respondent personally.[24] This is evident from:

[23] Transcript, p 21(12)-(14).

[24] See transcript, p 4(35)-(36). See also transcript, p 9 (14)-(21).

(a)The addition of a new paragraph 41A, where the respondent was alleged to be a person “involved in the contraventions” of s 18 of the ACL.[25]

[25] Amended statement of claim at p 9.

(b)The removal of the eighth defendant and the insertion of the respondent in the relevant part of schedule A of the amended statement of claim.

18․As will be apparent, it is necessary to reproduce paragraph 41A in full as it stood at the time of the hearing in light of the respondent’s submissions:

41AIn the alternative to the Plaintiff’s claim against [the respondent] made at paragraphs 31 to 38 [of the statement of claim] inclusive above, the Plaintiff says that the Compliance Representations the subject of that claim were made by Sellick Consultants Pty Ltd (ACN 634 296 629), [the respondent] was a person involved in the contraventions of section 18 of the ACL pleaded in relation to those Compliance Representations, and the Plaintiff claims the ACL Loss and Damage in respect of those Compliance Representations from [the respondent] as a person involved in those contraventions.

(Emphasis added by this Court.)

19․The Stanley affidavit affirmed that the applicant was informed on 6 May 2024 by the Court registry that leave by way of application would be required to include the respondent.[26] I note that the version that the applicant had in their possession had been stamped[27] 2 May 2024, with the versions of the proposed amended statement of claim in the court file appearing unstamped.[28] Counsel for the applicant detailed that the stamped version was “subsequently returned” as it was filed incorrectly without an application and leave was to be obtained.[29]

[26] Transcript, p 4(1)-(7); Stanley affidavit at [19].

[27] Transcript, p 4(3)-(5).

[28] Following the hearing, the amended statement of claim was filed.

[29] Transcript, p 4(1)-(7).

20․In any event, I granted leave for the proposed amended statement of claim to be filed within 7 days of my decision on 2 August 2024.

21․At the hearing, counsel for the applicant underlined that the claim against the respondent was made on the basis that the respondent “certified the structural capacity and integrity of various parts of the building”,[30] and that the claims made against the respondent have already been made against other entities in these proceedings.[31]  

[30] Transcript, p 9(20)-(27).

[31] Transcript, p 9(9)-(16).

22․Counsel for the applicant also referred to the Lim affidavit in oral submissions. The affidavit affirmed that Mr Joannides, the applicant’s general and structural expert, conducted inspections in November 2023, February 2024 and March 2024 of the development.[32] The inspections were stated to be for the purposes of providing “a litigation-compliant expert report”. The Lim affidavit noted that such a report will address representations and statements made by the respondent in the three certificates annexed to the affidavit, which I have set out above at [13].[33] Counsel for the applicant submitted that this Court may assume for present purposes that “there will be expert evidence” to the effect that “the certification, in relation to the defects that have appeared in the building of a structural nature, [is] misleading and deceptive”.[34]

[32] Lim affidavit at [5](a).

[33] Lim affidavit at [6].

[34] Transcript, p 12(13)-(18).

Preliminary Procedural Issues

23․It is convenient to discuss the final form of the application, before turning to the main issue of whether the respondent should be joined.

24․As discussed above at [4], the amended grounds for the application sought that the respondent be joined, relying on rr 220, 242 and 502 of the CPR. There was an issue regarding the applicable rule that ought be relied on by the applicant concerning the application.[35] Counsel for the respondent noted that the application “evolved” throughout the course of the hearing.[36]

[35] Transcript, p 42(22)-(23).

[36] Transcript, p 52(35)-(41).

25․Relevantly, rr 220 and 502 of the CPR provide as follows:

220 Court may include party if appropriate or necessary

(1) The court may order that a person be included as a party to a proceeding if—

(a) the person ought to have been included as a party; or

(b) including the person as a party is necessary to enable the court to adjudicate effectively and completely on all issues in dispute in the proceeding.

(2) The court may make an order under this rule—

(a)at any stage of the proceeding; and

(b) on application by the person or a party to the proceeding or on its own initiative; and

whether the person to be included should be a plaintiff or defendant.

Note 1 Pt 6.2 (Applications in proceedings) applies to an application for an order under this rule.

Note 2 Rule 6901 (Orders may be made on conditions) provides that the court may make an order under these rules on any conditions it considers appropriate.

…

(Emphasis added by this Court.)

502 Amendment—of documents

(1)At any stage of a proceeding, the court may give leave for a party to amend, or direct a party to amend, an originating process, anything written on an originating process, a pleading, an application or any other document filed in the court in a proceeding in the way it considers appropriate.

(2)The court may give leave, or give a direction, on application by the party or on its own initiative.

Note 1 Pt 6.2 (Applications in proceedings) applies to an application for leave or a direction under this rule.

Note 2 Rule 6902 (Leave may be given on conditions) provides that, if the court gives leave under these rules, it may give the leave on the conditions it considers appropriate.

(3)The court may give leave to make an amendment even if the effect of the amendment would be to include a cause of action arising after the proceeding was started.

(4)This rule does not apply in relation to an amendment of an order.

Note See r 6906 (Mistakes in orders or court certificates) for amendment of orders.

(5)This rule is subject to rule 503 (Amendment—after limitation period).

(Emphasis added by this Court.)

26․In essence, the objection by counsel for the respondent, Mr Moffett, to the application as first drafted was two-fold. Counsel submitted that the application as drafted was not an application to substitute a party but an application “solely predicated” under r 220.[37]  Counsel for the respondent submitted that the inclusion of paragraph 41A has the effect of including a new cause of action.[38] Further, counsel for the respondent submitted that such an application is beyond the scope of the original application as filed as a matter of form and substance.[39] Additionally, an application brought under r 220, in the respondent’s submission, would also not allow a party to bring a new cause of action, being the proposed action set out in paragraph 41A of the proposed amended statement of claim.[40]

27․Further, I note that Mr Moffett submitted that the ACL claim specified in para 31-38 of the statement of claim was not new.[41]

28․In this vein, counsel for the respondent referred to Foldi v Lloyd [2011] ACTSC 17 (Foldi).[42] In Foldi, Master Harper observed that while r 220 is the correct rule to be relied on to add further defendants to a proceeding, the rule does not permit a change in cause of action: Foldi at [27]-[28], citing Edgecock v Minister for Child Welfare [1971] 1 NSWLR 751 at 757 (Edgecock):

[37] Transcript, p 15(27)-(32).

[38] Transcript, p 17(47).

[39] Transcript, pp 18(4)-(14), 20(1)-(3).

[40] Transcript, p 42(29)-(31).

[41] Transcript, pp 44-45.

[42] Transcript, pp 43(35)-(45), 44(1)-(13).

27.The court’s power to order the addition of defendants is conferred by rule 220 of the Court Procedures Rules. The reference in the applications to rule 221 is incorrect; rule 221 provides for the addition or substitution of a plaintiff, not a defendant.

28.Rule 220 permits the addition, after the commencement of proceedings, of a defendant or defendants who ought to have been joined originally, or whose presence is necessary for the court effectively and completely to adjudicate on and settle all matters in dispute in the proceedings. The rule does not permit a change of the cause of action: Edgecock v Minister for Child Welfare [1971] 1 NSWLR 751 at 757. Where an order is made adding a defendant, the effect is different from that of an order adding a cause of action between the original parties, where the amendment has retrospective effect from the date of institution of the proceedings (see rr 502 and 503). Where an order is made adding a defendant, the proceeding against that defendant is not taken to have commenced until the date of the order (r 242), enabling a defendant in that position to plead a limitation defence where the limitation period expired between the commencement of the original proceedings and the date of the order. It is for this reason that the plaintiff will require, to have any practical prospect of succeeding against the defendants sought to be added, an extension of the limitation period against them.

(Emphasis added by this Court.)

29․The reference to Edgecock in Foldi appears to be a reference to the following observations by Jacobs JA (Moffitt JA and Taylor AJA agreeing):

However, it must be borne in mind that one cannot, by the exercise of the power to add a party, change the cause of action so that instead of suing A on one cause of action, one finishes up by suing B on another cause of action…

(Emphasis added by this Court.)

30․Counsel for the respondent noted that the Sellick Consultants entity with the nominated ACN (ACN 634 296 629) in paragraph 41A did not exist at the time the representations were said to be made.[43]

[43] Transcript, p 19(10)-(25).

31․In reply, counsel for the applicant submitted that it was clear that the representations were made by the respondent on behalf of “Sellick Consultants”.[44] Consequently, counsel for the applicant sought leave to amend paragraph 41A to remove the reference to the ACN or, in the alternative, to argue that there were two misrepresentations, one of which was made by the respondent personally.[45]

[44] Transcript, p 27(5)-(16).

[45] Transcript, p 27(15)-(22).

32․Counsel for the applicant accepted that r 242 of the CPR would be the applicable rule when the Court considers whether the cause of action would be out of time.[46] Counsel for the applicant therefore sought to amend the application and the grounds[47] to refer additionally to r 242.[48]

[46] Transcript, p 21(12)-(17).

[47] Transcript, p 23(1)-(8).

[48] Transcript, p 22(20)-(22).

33․Relevantly r 242 provides:

242 Included or substituted parties—date proceeding taken to start

(1)This rule applies if the court orders that a person be included or substituted as a party in the proceeding.

(2)The date the proceeding starts in relation to the person is taken to be—

(a)the date when the order is made; or

(b)if another date is stated in the order—that date.

(3)However, an earlier date must not be stated in the order if the inclusion or substitution of the person on that date would bring the start of the proceeding within a limitation period applying to the person.

(Emphasis added by this Court.)

34․This course was not opposed by the counsel for the respondent. I granted leave for the relevant amendments to be made.[49]

[49] Transcript, p 23(10)-(16).

35․Counsel for the respondent, further correctly submitted that r 242 “says nothing” about the substitution of a defendant.[50] Rather, the rule merely prescribes that if the respondent was joined the time the cause of action against the respondent is said to commence will be the date of the order that the respondent be joined.[51]

[50] Transcript, p 41 (1)-(12).

[51] Transcript, pp 40-41.

36․For his part, counsel for the applicant properly, in my view, submitted that the issue is the interests of justice, not the “technicality of the rules”.[52] In my view the interests of justice must predominate. Substance must predominate over style.

[52] Transcript, p 47(33)-(44).

37․Further, under the CPR there is a relevant rule, r 502, that would allow for the joinder of a party associated with a new cause of action. Counsel for the respondent agreed at the hearing that this was the case, stating, concerning r 502(3), “I think that seems to be the correct rule”.[53] For his part, counsel for the applicant properly noted that it is open for the court to dispense[54] with any of the rules in the CPR in the interest of justice, and correctly noted that the rules were “not there to enslave parties” but to assist so that the Court may deal with the merits of the case.[55] At the risk of repetition, that is, of course, correct. In the interests of justice, substance must outweigh mere form.

[53] Transcript, p 51(44)-(47).

[54] Transcript, p 51(25)-(28).

[55] Transcript, p 51(32)-(38).

38․Ultimately, I granted leave to further amend the grounds of the application to include r 502. Counsel for the respondent did not cavil with this course, save as to the issue of costs.[56]

[56] Transcript, p 52(2)-(5).

39․It is appropriate to note at this juncture, that the concession by the respondent is well made. It is, in my view, plainly within the scope of r 502 for this Court to grant an amendment that would introduce a new cause of action. If an amendment to introduce a new cause of action is not within the remit of r 502, one would query the utility of the limitations applying to amendments introducing a new cause of action after the expiry of a relevant limitation period in r 503(4).

40․Rule 503(4) relevantly provides:

503 Amendment—after limitation period

…

(4) The court may give leave to make an amendment to include a new cause of action only if—

(a) the court considers it appropriate; and

(b) the new cause of action arises out of the same facts or substantially the same facts as a cause of action for which relief has already been claimed in the proceeding by the party applying for leave to make the amendment.

41․Further, germane to this issue, in Naidu v Fergusson [2013] ACTSC 208; 8 ACTLR 150 Mossop M (as his Honour then was) stated:

[25] Rule 502 provides the general power to amend documents. It provides that the Court may "give leave" for a party to do so. It is notable that r 502(6) expressly makes the rule subject to r 503. Rule 503 "applies in relation to an application for leave" where a relevant limitation period current at the date the proceedings started has ended. I will assume, for the purposes of the operation of r 503, that the limitation period had not expired at the date the proceedings were started.

[27] Rule 503 works in combination with rule 502 because rule 503 only applies where "an application for leave" is made. Rule 502 contemplates an application for leave is necessary to be made in order to amend a document. Thus r 503 qualifies the general scope of the power to amend by limiting the circumstances in which that power to amend may be exercised after the expiry of the limitation period that was current when the proceedings were started.

42․Further, I note the provisions were introduced to overcome the position at common law concerning amendments interpolating a new cause of action after the commencement of the proceedings: Eshelby v Federated European Bank Ltd [1932] 1 KB 254 at 262-3; John Holland (Constructions) Pty Ltd v Jordin (No 2) (1985) 36 NTR 1 at 6; see also LexisNexis Butterworths, Civil Procedure ACT, vol 1 (at Service 146) at [502.15].

43․Separately, I considered it appropriate to grant leave to delete the reference to the ACN number from paragraph 41A of the proposed amended statement of claim.[57] Counsel for the respondent did not object to this course. It was, however, foreshadowed that further submissions concerning costs would be relevant to this issue.[58] I will turn to the question of costs later in this judgment at [74].

[57] Transcript, p 27(38)-(40).

[58] Transcript, pp 27(42)-(43), 28(6)-(10).

Should the respondent be joined?

The joinder of the respondent is appropriate

44․With the procedural issues resolved, I now turn to the question of whether the respondent should be joined. The main dispute between the parties on this issue was whether such an application would be futile in light of the applicable limitation periods.[59] The bulk of the oral submissions at the hearing were directed to this question.

[59] Transcript, p 25(15)-(18).

45․The significance of this issue is that an application under r 220 is liable to fail if the limitation period for the relevant cause of action has expired, for the joinder would likely be futile as the order would inevitably be met with an application for summary judgment: see Beta ACT Pty Ltd as Trustee for the Brendas Family Trust v FTI Consulting Pty Ltd [2021] ACTSC 293 at [72]-[73] (Crowe AJ); see also Philip Morris Ltd v Bridge Shipping Pty Ltd [1994] 2 VR 1 at 8-9 (Ashley J).[60] A proceeding for a party included under r 220 is deemed to start at the date of the order (r 242(2)(a)), and r 242(3) prevents an earlier date being specified if this would bring the start of the proceeding within an applicable limitation period.

[60] Transcript, p 25(15)-(18).

46․I will first set out the parties’ submissions on this issue, before outlining the reasons why in my view the application for joinder should be granted.

Consideration

Review of applicant’s submissions

47․Counsel for the applicant correctly submitted that High Court authorities have made it clear that limitation issues such as the one involved in this case should not be determined at an interlocutory application, except in “the clearest” of cases: Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 at 533 (Mason CJ, Deane, Gaudron and McHugh JJ) (Wardley).[61] In my view, it is clear that this is not the “clearest” of cases; therefore this issue should not be determined at this interlocutory stage.

[61] Transcript, p 33(27)-(45).

48․Counsel for the applicant noted that the cause of action under s 18 of the ACL in this case arose from damage suffered from latent defects in a building work.[62] Further, counsel properly submitted that it is accepted that a claim arising from defective works “only crystallises when the latency became manifest, or when defects ought to have been known”.[63] As such, counsel submitted that the “serious factual inquiry” demanded renders it inappropriate for the issue of accrual of cause of action and, by extension, the expiry of the relevant limitation period be determined at an interlocutory stage: see Wardley at 533.[64] I accept this submission, as it accords with my view, as to the necessity for a proper factual inquiry that cannot be undertaken at this interlocutory stage and should be undertaken at the final hearing.

[62] Transcript, p 35(11)-(29).

[63] Transcript, p 35(33)-(36).

[64] Transcript, p 35(36)-(37).

49․Counsel for the applicant further correctly submitted, that the High Court has made it “perfectly plain” in Wardley that, under the ACL, a loss or damage can be contingent and a plaintiff will not actually suffer loss until the contingency eventuates.  In this case, the “contingency” advanced by the applicant is the latency of the defects.[65] Referring to the Lim affidavit,[66] counsel for the applicant noted that the structural deficiency of the development was not known before, “at best 2020… but probably some time later”.[67] The Lim affidavit affirmed when the defects in the development first became known to the applicant. This was stated to be in February 2020.[68] Consequently, counsel properly submitted that the claim is “well within time” if this was the time at which the cause of action accrued.

[65] Transcript, p 36(21)-(24).

[66] Transcript, p 36(22), apparently referring to para [7]-[8] of the Lim affidavit. See also transcript p 13(23)-(31), citing para [7](d)-(e) of the L:im affidavit.

[67] Transcript, p 36(21)-(28).

[68] Lim affidavit at [7](d)-(e).

50․Ultimately, the submission for the applicant was that the operative question before this Court is whether the applicant is entitled to advance submissions that the limitation period for the claims has not expired.[69] That submission is, in my view, plainly correct. If joined, the respondent will, of course, nevertheless still be able to argue that the claim is time-barred.[70] It is beyond question that the cause of action against the respondent commences from when a court makes an order for joinder: see CPR r 242(2)(a).

[69] Transcript, p 36(30)-(32).

[70] Transcript, p 36(34)-(40).

51․In any case, counsel for the applicant foreshadowed an intention on the applicant’s part to apply for an extension of the limitation period under s 40 of the Limitation Act 1985 (ACT) (Limitation Act) in the proposed amended statement of claim.[71]

[71] Transcript, p 37(16)-(18).

Review of respondent’s submissions

52․Counsel for the respondent submitted that the applicable limitation period for the proposed claim against the respondent is 6 years, as prescribed by s 236 of the ACL.[72] I note that s 236 prescribes a limitation period for an action for damages for contravention of a provision of ch 2 (including s 18).

[72] Transcript, p 37(40)-(47).

53․Counsel for the respondent submitted that “the high point” of his submissions is that the limitation period for the claim commenced at the time upon which the purported representations were made.[73]

[73] Transcript, p 37(35)-(43).

54․Counsel for the respondent further noted that the statements in paragraphs [6]-[8] in the Lim affidavit, which counsel submitted would ground the applicant’s case for “latency or discoverability” of the alleged defects, would otherwise be “objectionable hearsay evidence” were it not for the exception in s 75 of the Evidence Act 2011 (ACT).[74] Counsel for the respondent submitted that this has relevance to the weight this Court would place on the evidence relied upon to support the applicant’s case that the limitation period should not begin to run when the representations was made.[75] It was argued that the commencement of the limitation period was when the representations in the certificate annexed to the Lim affidavit were made.[76] I do not accept this submission: see discussion at [59] below.

[74] Transcript, p 38(34)-(44).

[75] Transcript, pp 38-39.

[76] Transcript, p 39(3)-(4).

55․Additionally, counsel for the respondent submitted that even if this court were to accord weight to the Lim affidavit and accept the applicant’s case that the action accrued “as early as 2020”, this did not address paragraph 41A of the proposed amended statement of claim.[77] In oral submissions, counsel noted a lack of explanation from the applicant as to why the new cause of action against the respondent was not agitated at the start of the proceedings alongside the other claims. This lack of explanation was submitted to be “critical to the reasons” why the Court should dismiss this application.

[77] Transcript, p 39(21)-(35).

56․Further, counsel for the respondent also submitted that there was no authority to support the application of s 40 of the Limitation Act to a breach of statutory duty. Counsel submitted that the authorities accept that s 40 applies to claims in tort and contract: The Owners - Units Plan No 1917 v Koundouris [2014] ACTSC 269 at [83]-[84] (Mossop M) (Koundouris).[78]

[78] Transcript, pp 39(45)-(47), 40 (1)-(6).

57․Counsel for the respondent properly conceded, however, that if I did not accept his submission and placed weight on the Lim affidavit, there would be relevant factual evidence.[79] More generally, counsel for the respondent conceded that if I were to rule against the respondent’s submissions on the limitation issue the applicant’s claim is “arguably in time” and the Court could entertain the joinder.[80] Further, counsel for the respondent properly conceded that in that case, the argument on discoverability and limitation period would not be appropriate to “dispose on an interlocutory application”.[81]

[79] Transcript, p 40(8)-(13).

[80] Transcript, p 40(10)-(11).

[81] Transcript, p 40(12)-(14).

58․I have formed the view on the material before me that the argument on discoverability and the limitation period is an argument that it is not appropriate to finalise at this interlocutory stage. I set out my reasons below from [59] to [73].

Consideration: Conclusion

59․In my view, it is uncontroversial that for a claim for damages for misleading or deceptive conduct to arise from a misrepresentation, there must be:

(a)A misrepresentation;

(b)Reliance on that misrepresentation; and

(c)Damage.[82]

[82] Transcript, pp 47-48.

A mere misrepresentation, of itself, would not ground a cause of action for damages.[83]  

[83] Transcript, p 48(38)-(39).

60․Section 236 of the ACL relevantly provides:

236Actions for damages

(1)If:

(a)a person (the claimant ) suffers loss or damage because of the conduct of another person; and

(b)the conduct contravened a provision of Chapter 2 or 3;

the claimant may recover the amount of the loss or damage by action against that other person, or against any person involved in the contravention.

(2)An action under subsection (1) may be commenced at any time within 6 years after the day on which the cause of action that relates to the conduct accrued.

(Emphasis added by this Court.)

61․It is plain from the wording of s 236 of the ACL that it would not be sufficient for misleading or deceptive conduct alone to ground a claim of damages. There must have been loss or damage “because of” a contravening conduct of another: ACL s 236(1)(a)-(b); see also Wardley at 525.

62․As such, it is clearly arguable that the proposed action against the respondent under the ACL is not out of time: see Wardley at 527, 532. In my view, it is not appropriate for this Court to resolve the issue of the limitation period at this stage of the proceedings. The matter should be left to the final hearing and not finalised at this interlocutory stage.

63․This case before me, may be contrasted with, by way of example, The Owners – Units Plan 3550 v BCA Certifiers Australia Ltd [2021] ACTSC 3, where McWilliam AsJ (as her Honour then was) held that it was appropriate for the issue of the limitation period to be determined prior to trial given the concession of the plaintiff in the case (at [52]):

With regard to the operation of any limitation period, it was unclear from the arguments of the parties what date was the critical date on which each cause of action was complete, so as to assess whether the limitation period may have expired. I was initially minded to find that the question of the operation of any limitation period is more properly a matter for the trial judge (following Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 , where Mason CJ, Dawson, Gaudron and McHugh JJ remarked (at 533) on the undesirability of limitation questions being decided in interlocutory proceedings in advance of the hearing of the action, except in the clearest of cases). However, the plaintiffs conceded that if the Court found new causes of action arose, then such claims were outside the limitation period.

(Emphasis added by this Court.)

64․As I stated earlier, the case before me is not a case where it would be proper for this Court to resolve the question of limitation periods at this stage. It is, in my view, clear that the question of the limitation period is a matter for the judge at final hearing when deciding the factual questions. This question is not a question that is suitable for proper resolution now at this interlocutory stage. This case is not the “clearest of cases” as envisaged by the High Court.

65․Rule 220 exists to permit the joinder of parties who ought to have been joined originally at the commencement of the proceedings, or whose presence is necessary for the Court to adjudicate effectively and completely on all issues in dispute in a proceeding: see CPR r 220(1)(a)-(b); Qantas Airways Ltd v AF Little Pty Ltd [1981] 2 NSWLR 34.[84] The rule is also intended to avoid where reasonably practicable a multiplicity of proceedings: DPP v Martin [2014] ACTSC 104; 9 ACTLR 1 at [228] (Murrell CJ, Katzmann and Wigney JJ), citing News Ltd v Australian Rugby Football League Limited (1996) 64 FCR 410 at 524.

[84] Referred to in Civil Procedure ACT at [220.5].

66․In applying the CPR, including rr 220, 242 and 502, regard must also be had to the overarching purposes set out in s 5A of the CPA. I have had regard to the overarching purposes as set out in s 5A. This section underlines that the purpose of the civil procedure provisions is that disputes are to be resolved in a just manner; according to law and as quickly and as inexpensively and as efficiently as possible. These are important considerations for the civil justice system. As with Parkinson’s law, “work expands so as to fill the time available for its completion”.[85] Justice is not served if justice is slow, expensive and inefficient.

[85] Cyril Northcote Parkinson, ‘Parkinson’s Law’, The Economist (London, 19 November 1955).

5A Main purpose of civil procedure provisions

(1)The main purpose of the civil procedure provisions is to facilitate the just resolution of disputes—

(a) according to law; and

(b) as quickly, inexpensively and efficiently as possible.

(2) Without limiting subsection (1), the main purpose includes the following objectives:

(a)the just resolution of the real issues in civil proceedings;

(b)the efficient use of the judicial and administrative resources available for the purposes of the court;

(c)the efficient disposal of a court’s overall caseload;

(d)the timely disposal of civil proceedings;

(e)the resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute.

(3)The civil procedure provisions must be interpreted and applied, and any power or duty imposed by them (including the power to make rules) must be exercised or carried out, in the way that best promotes the main purpose.

(4) The parties to a civil proceeding must help the court to achieve the objectives.

(5) In this section:

civil procedure provisions means—

(a) the rules made under section 7, in their application to civil proceedings; and

(b) any provision of this Act in relation to the practice and procedure of a court in civil proceedings.

court includes a tribunal that is a prescribed tribunal under section 6.

(Emphasis added by this Court.)

67․Specific reference was made by the High Court to r 502 in Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; 239 CLR 175 at [89] (Gummow, Hayne, Crennan, Kiefel and Bell JJ) (Aon).

A power is given to the court by r 502(1) to permit the amendment of pleadings “in the way it considers appropriate”. Rule 21(2) specifies, in paras (a) and (b), the objectives to be sought by the exercise of the power conferred by r 502(1). In this setting, some care is called for in describing the grant or refusal of an application to amend in such a way as to suggest a very wide discretion in the decision whether to permit amendment. The observations by Gleeson CJ, Gaudron and Hayne JJ in Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission are apposite:

“‘Discretion’ is a notion that ‘signifies a number of different legal concepts’. In general terms, it refers to a decision-making process in which ‘no one [consideration] and no combination of [considerations] is necessarily determinative of the result’. Rather, the decision-maker is allowed some latitude as to the choice of the decision to be made.”

Their Honours went on to point out that the latitude as to choice may be considerable or it may be narrow. Given the terms of r 21, it could not be said that the latitude as to the choice of decision, as to whether to grant or refuse leave to amend, was at large. The objectives in r 21(2) are to be sought in the exercise of the power given by r 502(1).

(Footnotes omitted.)

68․Of course, while amendments can be made at any stage of a proceeding, it is desirable that amendments be made as soon as possible: see Aon at [4] (French CJ).

69․An application for an amendment would involve a complete change in the nature of the claim or the whole character of the action is liable to be refused: see Gibbons v Westminster Bank Ltd [1939] 2 KB 882 at 887. The same is true of amendments involving “new claims not previously agitated” due to a “deliberate tactical decision”: Aon at [4].

70․In my view, this is not such a case. The joinder of Mr Sault to the civil proceedings commenced by the applicants does not fall into that category. This is not a case that involves a complete change in the nature of the claim, nor is this amendment opposed as a case of a new claim due to a deliberate tactical decision. Finally, the amendment was not sought at a late stage of the proceedings.

71․Therefore, I am satisfied that the respondent should be included in these proceedings as the fourteenth defendant.

72․Accordingly, I granted leave for the plaintiff to file an amended statement of claim within 7 days.

73․At the hearing I also made orders for the respondent to file a notice of appointment of solicitor within 7 days.[86] Additionally, I listed the matter for further directions before the Registrar on 12 August 2024 after the service of the amended statement of claim.[87]

[86] Transcript, p 56(14)-(21).

[87] Transcript, p 59.

Costs

74․The only remaining issue in this matter is costs. At the hearing, I proposed to make orders for a timetable for written costs submissions in the conventional manner. Nevertheless, counsel for the respondent properly preferred to await these reasons.

75․As foreshadowed, one of the issues to be canvassed in written submissions would be costs in relation to the amendment of paragraph 41A to remove the ACN.[88]  As I observed at the hearing, these costs may include the costs incurred by the respondent in conducting proper searches for the nominated ACN, the results of which were attached to the Hendry affidavit.[89] Counsel for the applicant did not disagree to the extent that there were costs incurred by having to cross out the ACN.[90] Counsel for the applicant correctly agreed that such matters can be dealt through written submissions, as is the usual case.[91]

[88] Transcript, pp 27(42)-(43), 28(6)-(10).

[89] Transcript, p 30(1)-(3).

[90] Transcript, p 30(14)-(16).

[91] Transcript, p 30(16), (29)-(30).

76․The other issue that is apparent is the consequences of, to borrow the respondent’s phrasing, the “evolving” nature of the application. This includes the amendment of the application to include r 502.[92]

[92] Transcript, p 52(35)-(40).

77․It is therefore sufficient to repeat, as I foreshadowed at the hearing, that I will grant all parties leave to file written submissions on costs after the publication of these reasons, and this Court will make orders for a timetable for the written submissions on the issue of costs.

Orders

78․Accordingly, for the above reasons I made the following orders on 2 August 2024.

(1)Mr Darren Sault is joined as the fourteenth defendant in this proceeding.

(2)The Plaintiff is granted leave to file an amended statement of claim within 7 days.

(3)Mr Darren Sault is to file a notice of appointment of solicitor within 7 days.

(4)The matter is listed for directions before the Registrar on Monday, 12 August 2024 at 9.30am.

(5)All parties are granted leave to file written submissions on costs after the publication of reasons.

I certify that the preceding seventy-eight [78] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Justice Loukas-Karlsson.

Associate:

Date: 18 September 2025