VACAD Pty Ltd v Richard Nicholas Longley trading as Longley Architects and Associates - [2002] WADC 27

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS

LOCATION: PERTH

CITATION: VACAD PTY LTD & ANOR -v- RICHARD NICHOLAS LONGLEY trading as LONGLEY ARCHITECTS & ASSOCIATES & ORS [2002] WADC 27

CORAM: DEPUTY REGISTRAR HARMAN

HEARD: 21 JUNE 2001 & 15 JANUARY 2002

DELIVERED : 18 FEBRUARY 2002

FILE NO/S: CIV 21 of 1999

BETWEEN: VACAD PTY LTD (ACN 009 042 193)
First Plaintiff
SHARON LOIS JENNIFER PATTON
Second Plaintiff
AND
RICHARD NICHOLAS LONGLEY trading as LONGLEY ARCHITECTS & ASSOCIATES
First Defendant
FALVEY NOMINEES PTY LTD (ACN 008 775 915)
Second Defendant
PATRICK JOHN KENNY
Third Defendant
COLIN ARTHUR WILLIS
Fourth Defendant

Catchwords:

Practice - Western Australia - Practice under the Rules of the Supreme Court of Western Australia - Application to amend a pleading O 21 r 5(5) - Consideration of the facts - Contractual limitation - Case management

Legislation:

Nil

Result:

Dismissed

Representation:

Counsel:

First Plaintiff                  :     Mr A M Prime
Second Plaintiff             :     Mr A M Prime
First Defendant              :     Mr C D Raymond
Second Defendant         :     Mr K Prasad
Third Defendant            :     No appearance
Fourth Defendant           :     No appearance

Solicitors:

First Plaintiff                  :     McCallum Donovan Sweeney
Second Plaintiff             :     McCallum Donovan Sweeney
First Defendant              :     Pynt McKay
Second Defendant         :     Naveen Pillay
Third Defendant            :     Not applicable
Fourth Defendant           :     Not applicable

Case(s) referred to in judgment(s):

Nil

Case(s) also cited:

Nil

DEPUTY REGISTRAR HARMAN: By the action the plaintiffs seek damages from the defendants. The first defendant was the second plaintiff's architect, the second defendant, the plaintiffs' builder. The plaintiffs have made application to amend the statement of claim. It is opposed by the defendants. The onus is upon the plaintiffs.
The defendants have raised a number of issues in relation to the proposed pleading. The methodology of the plaintiffs in seeking to file a substituted pleading also raises the prospect that if they fail in part the application will fail as a whole.
Evidently my observations to that effect at the conclusion of the first day of the hearing has precipitated the filing of a fresh minute in the form which would follow the process of amendment in the form countenanced by the rules. However the first defendant has demonstrated to my satisfaction that the two minutes could not be so reconciled. At the conclusion of the second hearing the plaintiffs both explicitly and implicitly conceded that there was some further amendment brought in by the second minute. The implicit concession was inherent in the plaintiffs' failure to address the balance of the points of difference identified by the first defendant. In any event the plaintiffs did not substantially address the new minute. They did not abandon the minute of substituted statement of claim.
At the conclusion of the second day of hearing I expressed my opinion that although in relation to discrete points I could follow the process of amendment now contemplated by the plaintiffs I would consider that the only comprehensive minute before me was the proposed substituted pleading. Although the applicants will ultimately bear the costs of the application, in my opinion there is a limit to the resources which the respondents should be expected to devote to the exercise of responding to an application to amend. In my opinion until the plaintiffs abandon the minute of substituted statement of claim it is unreasonable to expect the defendants to devote resources to analysing the later minute once it becomes evident that the minutes differ as to their content. Equally it is not for the court to have to evaluate the later proposal in order to determine the extent to which the proposal departs from the original.
In considering the merits of the application the significant issue is foreshadowed in the first defendant's defence. He pleads at par 19A that it was a term of the relevant agreement between the parties that any action by which a claim is advanced be brought no later than one year from the provision of the last services by the defendant under the agreement. It is common ground that if by the amendment the plaintiffs seek to introduce a new claim then the process of amendment would enable them to circumvent that limitation. The rules provide jurisdiction to allow for such a result if the new cause arises out of the same or substantially the same facts as the cause already pleaded. That jurisdiction is unfettered.
As presently pleaded the case is founded upon the contractual obligation of the first defendant to provide architectural services associated with the construction of a residence. Details of those services are provided at par 8 and include express terms that the defendant would "… prepare contract documents and assist in the execution of a building contract with a nominated builder for the construction of a two storey residence …" administer and supervise performance of that contract by the builder and obtain proof of insurance cover for the contractual obligations of the builder.
The pleading refers to a "nominated" builder without any suggestion either that it would be the architect who would confer that designation on any builder or the mechanism by which the designation would be conferred. In the absence of any pleading it is appropriate to consider that as much as the plaintiff may engage and pay for the services of an architect, she would also engage and pay for the services of a builder. At the very least it is for the plaintiffs to plead a case, if in that pleading they introduce language which suggests an act without identifying the actor it is not appropriate to assume that person to be the defendant. If I may illustrate the point, by the amendment the plaintiffs wish to now seek to plead that it was indeed the defendant who was to nominate suitable builders to tender for the work.
Arguably the plaintiffs seek to clarify the pleading. However the proposal seeks to establish an obligation beyond simply nominating a builder. The plaintiffs seek to contend for an obligation to ensure that the builders nominated by the defendant to tender were registered and competent. Further that he would evaluate the tenders and advise the second plaintiff of the most appropriate builder. It is only at that point that the plaintiffs would more or less seek to revert to the present pleading as to the defendant assisting with the execution of a building contract. Significantly the contractual obligation sought to be pleaded would extend the defendant's involvement in the process of the engagement of a builder to a time prior to that contemplated by the current pleading. I am not able to evaluate either what may have been the length of that period or the extent to which the defendant may have discharged that obligation over any period. Some six years have passed since that time and that period is sufficiently long to allow for the perception that what may have been only a matter of days is almost no time at all. In my opinion in considering an exercise of discretion it is not inappropriate to stand at the point where the defendant is "assist(ing) in the execution of a building contract with a nominated builder" and consider the additional period of time which the plaintiffs now seek to bring into the contest. That vantage point also gives a proper perspective to the context into which the plaintiffs seek to plead additional obligations upon breach of which they seek to recover for loss. I have already outlined the extent by which the plaintiffs seek to enhance their prospects of recovery. In my opinion the only common facts relate to the identity of the parties and their broad common intention as is evident in their execution of the agreement. There is some similarity in the facts that would support the proposed pleading and any investigation of the insurance cover held by the builder but ultimately the relevant facts are not similar. There is only broadly speaking some similarity in the processes in which the defendant was required to engage.
The additional obligations do not arise from the terms of the written agreement presently pleaded. It is proposed that they arise from a more broadly pleaded contract the relevant particulars of which are identified firstly as oral, having taken place at least three weeks prior to the execution of the written agreement, secondly in the form of a letter sent at or about that earlier time and thirdly, implied. In so far as the obligations are alleged to be other than implied, it is of interest but not strictly relevant to the application that the consideration for them is determined by the agreement as it is presently pleaded however they are not mentioned in that agreement. As to the allegation that the obligations arise from implication, it draws upon the totality of the pleaded relationship between the parties. The obligations are not the same as any obligation presently pleaded.
Moving on to consider the issue of breach of the proposed contractual obligations, in my opinion any such a breach occurred prior to or at least at the time of the selection of a builder by the second plaintiff. On the same analysis any such breach occurred at some time prior to the period encompassed by the claims which are currently the subject of the action.
Any assessment of the loss suffered as a consequence of breach of the obligations would proceed upon a different basis to an assessment of loss for breach of any obligation presently pleaded, even that which relates to the insurance cover of the builder.
The plaintiffs seek to raise further claims on the basis of both contract and tort at par 41. Those claims are founded upon an obligation to ascertain the authority of the third and fourth defendants to contractually bind the builder and to ensure that they were competent. Those additional cases may draw upon the terms of the agreement as presently pleaded between the second plaintiff and the first defendant. Be that as it may, in my opinion the fact that the parties entered into an agreement is but one fact which would support the case for amendment.
The issue also bears upon the other alleged breaches now sought to be advanced at par 26 in relation to what conceivably may be the performance by the first defendant of his obligations under the agreement as it is presently pleaded. The particulars of breach include a failure to estimate the building cost, to provide his own specifications, and the adoption of the builder's estimate and specifications, further that the first defendant's drawings and the specifications were in conflict. Further breaches are alleged at par 27 as to deficiencies in terms of the building contract. Each allegation of breach is new.
In each of the instances of breach which I have canvassed the breach complained of does not relate to the breaches the subject of the present pleading. In my opinion each proposed breach is of a different character to those presently pleaded. In each instance other than those in the last category the breach occurred at a time prior to the defendants engagement in the process of assisting in the execution of a building contract. In the instance of the last category they go beyond the process of building contract administration the subject of the current pleading.
In my opinion the new grounds for the defendants liability proposed by the plaintiffs do not arise on the same or similar facts as those the subject of contest in the action. It follows that there is no basis for the exercise of discretion in favour of the applicants.
If I have erred in my assessment of the proposed pleading then in considering the exercise of discretion I ought to be circumspect in exercising jurisdiction particularly where the parties have agreed that an action based upon a relevant cause be commenced expeditiously. It is not necessarily appropriate to consider the motivation of the parties in agreeing to that provision, however it obviously benefits the architect and may reflect how he has chosen to structure the operation of his business. It follows that the plaintiffs ought not be granted leave to amend to the extent that they seek to introduce new causes of action against the first defendant.
The second defendant also opposes the application. It was the builder engaged by the plaintiffs. The proposed amendments do not engage the issue of limitation. In order to seek to defeat the application the second defendant primarily seeks to rely upon the "principles" of case management. The defendant also presents a case along the lines that the amendment proposed is too late by some measure and that it will be prejudiced by the late application particularly in the context where the present case has been got up for trial. I apprehend that if the application was granted the defendant would need to undertake further proofing, that there may be further interlocutory proceedings and that the passing of time would impact upon the whole or parts of the work to be done in preparing for trial.
There are no principles which support case management. Case management is simply a strategy implemented by the court to some end or ends. It is difficult to conceive that case management could justify an exercise of discretion to refuse an application to amend a pleading. In this case the action has not been listed for trial.
I appreciate that the plaintiffs may have been tardy in taking action during the earlier interlocutory stages and whilst that may have drawn criticism and maybe cost consequences that is of no concern in a context where the plaintiffs seek to amend the case which they seek to put to trial. It was not contended by the second defendant that the court ought to consider issues which may arise in the context of a "want of prosecution" application. In any event there would be nothing to prevent the plaintiffs from commencing a fresh action on the terms now proposed.
Otherwise the second defendant sought to portray the plaintiffs' proposal as untenable but not on my understanding untenable as a pleading.
Accordingly to the extent that the respondents have addressed the application the first defendant is successful and the second, unsuccessful. As I have already indicated, by the application the plaintiffs sought to file a substituted pleading. As to part of that proposal the plaintiffs have been unsuccessful. I see no alternative to the dismissal of the application.