Il Forno Limited v Kleine

[2020] NZHC 1732

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2016-404-621

[2020] NZHC 1732

BETWEEN

IL FORNO LIMITED

Plaintiff

AND

DOUGLAS JAMES KLEINE

First defendant

AND

FLOW CONTROL LIMITED

Second defendant

AND

ANDREW MICHAEL KLEINE

Counterclaim defendant

Hearing:	16 July 2020
Appearances:	MJW Lenihan for the plaintiff and counterclaim defendant J G Ussher for the defendant and counterclaim plaintiff
Date of judgment:	16 July 2020

JUDGMENT OF JAGOSE J

This judgment was delivered by me on 16 July 2020 at 4.30pm.

Pursuant to Rule 11.5 of the High Court Rules

………………………… Registrar/Deputy Registrar

Counsel:

MJW Lenihan Barrister, Auckland J G Ussher Barrister, Auckland

IL FORNO LTD v KLEINE [2020] NZHC 1732 [16 July 2020]

[1]        At the close of the plaintiff’s case, Il Forno sought leave to amend its counterclaim defence.

[2]        The sought amendment was in response to the defendants’ counterclaim in quantum meruit, in  relation  to  which  they plead  “Flow  Control  [provided],  and Il Forno freely accepted provision of services including” some 25 particularised services (a) to (y). In response, Il Forno admitted the defendants “provided some services” including those particularised (a) and (b) by the defendants, and denied others including (k), (l), and (m).

[3]        Il Forno then additionally asserted particular of the services “were not requested by the plaintiff”. Il Forno now seeks to add (a) and (b) to that list, and omit (k), (l), and (m) from it.

Discussion

[4]        For good reason of focused trial preparation, amendment is prohibited after the close of pleadings without leave.1 Mr Lenihan did not seek to rely on HCR 7.7(2)(b)’s entitlement to amend after close of pleadings as “merely bring[ing] up to date the information before the court”. Thus I must be alive to anything in the sought amendment that changes the complexion of the case from that the defendants must meet.

[5]        To obtain leave, Il Forno needs to “surmount the three formidable hurdles of showing that the amendment is in the interests of justice and will not significantly prejudice defendants or cause significant delay”.2 On the first, Mr Lenihan the interests of justice favour having “the pleading align with the evidence”, and there is no

1      High Court Rules 2016 (“HCR”), r 7.7(1).

2      Elders Pastoral Ltd v Marr (1987) 2 PRNZ 383 (CA) at 385. The explanation in McGechan on Procedure (online looseleaf ed, Thomson Reuters) at [HR7.7.01] “[t]he test for an amendment to pleadings after the close of pleadings date is whether it is necessary to determine the real controversy between the parties and does not result in injustice to other parties or cause significant delay” is not consistent with the Court of Appeal’s judgment, which only allows “the Judge here was entitled to treat the amendments as more in the category of those clarifying issues in dispute than in the category of those introducing distinct matters for the first time” (at 385). The “real controversy between the parties” the High Court Rules' threshold for the court’s (and not a party’s) amendment to pleadings: HCR, r 1.9.

prejudice or delay.  Although  the  defendants  oppose  on  grounds  of  prejudice,  Mr Ussher could not identify any prejudice from the sought alignment.

[6]        The precise specification of services Il Forno says it did not request of the defendants lacks material substance in response to the assertion Flow Control provided and Il Forno “freely accepted” the particularised services, which Il Forno admits in part and otherwise denies. Il Forno admits the defendants provided (a) and (b), and denies they provided (k), (l), and (m), whether or not at its request. The parties’ respective cases are unchanged. From that perspective the amendment has no impact, and may have been open to being made without leave as ‘updating’.

Result

[7]        I allow the amendment as being in the interests of justice, without prejudice or delay.

Costs

[8]        In my preliminary view, Il Forno – although the successful party on the application – was seeking an indulgence, and therefore should not be entitled to its costs on the application. Any different view may be essayed on costs in the proceeding.

—Jagose J