Red Stag Timber Limited v Juken New Zealand Limited

[2023] NZHC 2947

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2017-404-002753

[2023] NZHC 2947

BETWEEN

RED STAG TIMBER LIMITED

Plaintiff

AND

JUKEN NEW ZEALAND LIMITED

Defendant

Hearing:

16 October 2023

Appearances:

N Flanagan and E Watt for Plaintiff

A R Galbraith KC, C Bryant and G Luen for Defendant

Judgment:

20 October 2023

JUDGMENT OF VENNING J

This judgment was delivered by me on 20 October 2023 at 2.30 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

Solicitors:           Meredith Connell, Auckland

Hesketh Henry, Auckland Counsel:    A R Galbraith KC, Auckland

RED STAG TIMBER LTD v JUKEN NZ LTD [2023] NZHC 2947 [20 October 2023]

Introduction

[1]Juken New Zealand Limited (JNL) applies for orders:

(a)striking out Red Stag Timber Limited’s (Red Stag) seventh amended statement of claim (7ASOC), in whole or in part, for non-compliance;

(b)striking out those parts of the 7ASOC which are time barred;

(c)indemnity or increased costs; and

(d)if required, leave to file the application after the close of pleadings.

[2]Red Stag opposes the applications. It also seeks indemnity costs.

[3]        This is not the first time the Court has been asked to review Red Stag’s pleadings in light of the Court of Appeal judgment which ultimately made orders:1

[76] … [s]triking out those parts of the fourth amended statement of claim that seek relief in respect of representations and/or conduct by JNL prior to December 2012 and all claims (or any part thereof) based or relying on such allegations.

[4]        Within days of delivery of that decision, Red Stag filed its 5ASOC. It then subsequently filed its 6ASOC, together with an application for leave, which the Court and the parties used as a vehicle to determine whether the proposed amended pleading complied with the directions of the Court of Appeal.

[5]        This Court held the 6ASOC did not comply,2 and dismissed Red Stag’s application for leave to file the amended statement of claim in the form of the 6ASOC.

However, this Court went on to grant leave to Red Stag in the following terms:3

[46] Leave is granted to Red Stag to file an amended statement of claim on condition that amended statement of claim is not to refer to and/or rely on the pre-December 2012 conduct of JNL to support any claim for loss, including any loss claimed to have arisen after December 2012. Any losses claimed after December 2012 are to be based solely on conduct after December 2012.

1       Juken New Zealand Ltd v Red Stag Timber Ltd [2023] NZCA 242.

2      Red Stag Timber Ltd v Juken NZ Ltd [2023] NZHC 1979.

3      Red Stag Timber Ltd v Juken NZ Ltd, above n 2.

Red Stag may, however plead JNL’s conduct prior to December 2012 as background.

[6]        In response, Red Stag has filed the 7ASOC. JNL considers the 7ASOC still does not comply with the judgment of the Court of Appeal and subsequent decision of this Court and for that reason pursues the above orders.

Background

[7]        The factual background is well known to the parties. It is set out fully in the decision of the Court of Appeal and in summary form in the judgment of this Court on the application for leave to file the amended pleadings. It is unnecessary to repeat it on this application.

JNL’s position

[8]        JNL says the 7ASOC does not comply with either the Court of Appeal judgment or the judgment of this Court on the leave to file the amended pleadings because, inter alia:

(a)it maintains a claim for relief in respect of representations which include conduct in the period prior to December 2012;

(b)it relies in part on its interpretation of treatment requirements prior to December 2012;

(c)the claim for representations in the period prior to December 2012 underpins Red Stag’s quantum claim;

(d)Red Stag’s claim for damages as confirmed in the brief of evidence of James Mellsop is based on the counterfactual that JNL could not have entered the market in 2007 if it had not made the representations;

(e)Red Stag’s claim for relief based on JNL’s failure to make “corrective disclosure”, appears to be based on JNL’s conduct prior to December 2012;

(f)to the extent Red Stag seeks declaratory relief relating to pre-December 2012 conduct Red Stag’s claim for declaratory relief was struck out by the Court of Appeal and cannot be maintained;

(g)background or contextual facts should only be pleaded if it is not possible to understand the critical allegations without them. The matters pleaded by Red Stag as background are contentious and are not relevant to the claim.

[9]        JNL next says that Red Stag’s allegation in relation to the obligation to make “corrective disclosure” was first raised in the 7ASOC and is time barred as is Red Stag’s allegation at para 39 that, after December 2012 J-Frame did not comply with the relevant standard because it did not have (inter alia) complete sapwood penetration. That allegation was first made in the 5ASOC.

Red Stag’s position

[10]      Red Stag opposes the applications. It says that the 7ASOC complies with the Court of Appeal’s judgment and the subsequent judgment of this Court. It says this Court’s judgment allowed Red Stag to plead JNL’s conduct prior to 2012 as background or for the purposes of seeking a declaration and no parts of the 7ASOC are time barred pursuant to s 43A of the Fair Trading Act 1986 such that they should be struck out.

[11]      Red Stag says the allegations relating to “corrective disclosure” and complete sapwood penetration are not based on representations and conduct that occurred before 2012 and do not constitute fresh causes of action.

[12]      Red Stag also takes the point that leave was required for JNL’s application as a separate step prior to it being made and no such application was made.

Procedural issues

[13]      Red Stag’s claim against JNL has been on foot in one form or another since November 2017. The proceeding has a 10 week trial scheduled to commence in

February 2024. At present, Red Stag has an application for leave to appeal the Court of Appeal decision before the Supreme Court for decision. The parties accept that if the Supreme Court grants leave then the fixture for February 2024 will have to be vacated.

[14]      In the meantime the parties and this Court must continue on the basis the fixture in February 2024 will proceed. There are outstanding interlocutory applications which the Court has allocated a fixture for on 9 November 2023.

[15]      Despite the impending fixture in February the pleadings are not yet settled and JNL is yet to exchange its evidence. It is in both parties’ interests for there to be certainty around the pleadings to enable the parties to conclude their preparation for the trial in February. To that end and bearing in mind the aspirational objective of the rules is the just, speedy and inexpensive determination of the proceeding (regrettably the last two objectives at least are not often achieved) to the extent leave is required for JNL to bring the application leave is granted.

[16]      On my review of the pleadings there are three issues that require to be determined in relation to JNL’s challenge to the 7ASOC. They are:

(a)whether Red Stag may maintain its application for declarations regarding JNL’s conduct pre-December 2012;

(b)whether the pleading as to “corrective disclosure” and complete sapwood penetration are statute barred; and

(c)whether aspects of Red Stag’s pleadings go beyond background and/or contextual pleading and offend the general rules for pleading.

The declaration issue

[17]At para 56 of the 7ASOC Red Stag pleads:

As set out in Column C of Schedule 1, the Promotional Representations and Identification Representations (together, the Representations, which are relied upon prior to December 2012 only for background, including the fact of their

being made, and for the purposes of seeking the declarations pleaded) were false because at the relevant times:

…

[18]      Mr Galbraith KC submitted that it was not open to Red Stag to include a pleading seeking a declaration regarding the pre-December 2012 conduct by JNL. Such relief had been excluded by the Court of Appeal judgment.

[19]      Mr Flanagan submitted that the declarations were sought under the inherent jurisdiction of the Court and, if necessary, under the Declaratory Judgments Act 1908. As confirmed by the decision of Chambers J in Telecom Corp of New Zealand v Commerce Commission such declarations were not statute barred.4 Further, he relied on the judgment of this Court as leaving the matter open for determination at trial.

[20]In its decision on the previous application for leave, this Court noted:5

[17] … The issue of the declarations and other challenges can  be  determined at trial.

but later went on to say:

[44]  For present purposes and absent further detailed argument on the point I leave open the issue of whether Red Stag can pursue the declarations sought. What Red Stag cannot do however, is claim for losses occurring after December 2012 that are based on representations and conduct that occurred before December 2012.

[21]      To the extent that this Court’s decision on the matter has muddied the water on this issue that is regrettable. However, I do note that the focus of the hearing before the Court at that time was understandably on Red Stag’s claim for financial loss and compensation for pre-December 2012 conduct. At [40]–[42] for example, the focus was on the losses Red Stag was claiming. Earlier, this Court had dealt with the Telecom case in the following way which confirms the focus was on the losses claimed by Red Stag:6

[38] The Telecom case relied on by Mr Flanagan does not assist Red Stag. That aspect of the case primarily involved consideration of whether a

4      Telecom Corp of New Zealand v Commerce Commission [2012] NZCA 278.

5      Red Stag Timber Ltd v Juken NZ Ltd, above n 2.

6      Red Stag Timber Ltd v Juken NZ Ltd, above n 2.

declaration could be available. In his decision Chambers J made it clear that a declaration could, in some circumstances, be available in the inherent jurisdiction of the Court. But relevantly, at an early stage Chambers J had noted the claim for damages was not available as the Commission acknowledged it could seek penalties only with respect to conduct within the last three years because of the limitation provision in s 80(5) of the Commerce Act 1986.

[22]      However, the issue of whether Red Stag may seek, by way of relief, a declaration that JNL’s conduct pre-December 2012 breached the Fair Trading Act 1986 (FTA) is now directly before this Court. For the reasons given above I consider it is necessary to deal with it in order to clarify and settle the pleading issue.

[23]      As noted, Mr Flanagan accepted that the declarations were sought in the inherent jurisdiction of the Court (and possibly under the Declaratory Judgments Act). That was a proper concession as the declarations sought do not comfortably fit within the type of declarations that the Court can make under s 43(3) of the FTA, nor can Red Stag itself apply for the type of declarations that the Commission could apply for under s 46I of the FTA. If the declarations were sought under s 43(3) they would, in any event, be statute barred in relation to pre-December 2012 conduct: s 43A.

[24]      Of course I accept the force of Chambers J’s reasoning in the Telecom case in which His Honour confirmed that, in the exercise of its inherent jurisdiction, the Court could make a declaration notwithstanding that a statutory basis for declaration may be barred by limitation provisions. However, there is an important distinguishing feature of that case which is absent from the present. It is, that in the Telecom case, as Chambers J noted, the declarations were sought by the Commerce Commission in the public interest.7

[25]      Further, in X and Y v Chief Executive of Oranga Tamariki,8 the Court of Appeal, while accepting that the discretion to grant declaratory relief is not generally time barred, noted that where a corresponding claim for compensation cannot proceed, the reasons barring the compensation claim can be important considerations when assessing whether a claim for declaration should proceed or whether relief should be granted. It also confirmed the Courts will be slow to permit such claims.

7      Telecom Corp of New Zealand v Commerce Commission, above n 4, at [321].

8      X and Y v Chief Executive of Oranga Tamariki [2023] 2 NZLR 261.

[26]      Despite what Red Stag may say, there is no public interest pursued in the present case. Red Stag is not a public regulatory authority. It is a commercial competitor of JNL. At the heart of Red Stag’s claim is its claim for the losses caused to it by JNL’s breaches of the FTA. The declarations sought very much form part of the relief claimed. They are the first step in the process of Red Stag’s claim for its loss. That is apparent from the form of the relief sought in the 7ASOC. For example, the claim for breach of s 9 of the FTA concludes:

Accordingly, the plaintiff seeks:

(a)A declaration that the conduct pleaded … is conduct that constitutes or would constitute a contravention of section 9 of the [FTA].

(b)An order pursuant to section 43(3)(f) directing that [JNL] pay to Red Stag the amount of the Loss.

(c)Interest.

(d)Costs.

[27]      The loss claimed in (b) under s 43(3)(f) of the FTA is dependent on the finding, confirmed by the declaration, of a contravention of s 9 of the FTA. The declaration is intrinsically linked to the relief. It provides a springboard for the further relief claim under s 43(3)(f) of loss. That format is repeated throughout the remaining causes of action.

[28]      Next, and in any event as Mr Galbraith submitted, whatever this Court said in its previous decision about the issue of declaration being determined at trial, (which will be the case for post-December 2012 conduct), this Court cannot override the effect or impact of the Court of Appeal decision. The Court of Appeal said:9

[72] In the absence of agreement, we consider the appropriate course is to allow the appeal on the basis of the relief claimed, albeit in a slightly modified form. Consistently with the reasoning set out above, we consider the appropriate form of relief is to strike out those parts of the amended statement of claim that seek relief in respect of representations and/or conduct by JNL prior to December 2012 and all claims (or any part thereof) based upon or relying on such allegations.

9      Juken New Zealand Ltd v Red Stag Timber Ltd, above n 1.

[29]      For the above reasons the current application for declarations form part of the relief sought by Red Stag and, as such, fall within the bar created by the Court of Appeal decision.

[30]      The short point is that the effect of the Court of Appeal decision is that Red Stag may not pursue, as part of its application for relief, declarations that JNL’s conduct pre-December 2012 was in breach of the FTA.

[31]      I have considered the impact of this decision on Red Stag, given the previous decision of this Court, which had proposed the matter be left open. However, as noted, Red Stag currently has an application for leave before the Supreme Court. Mr Flanagan and Ms Watt confirmed that the issue of the availability of declaratory relief was expressly raised in the application for leave. Ultimately the issue will be determined by that Court.

[32]      I conclude that Red Stag is prevented by the decision of the Court of Appeal from pursuing a declaration (even under the inherent jurisdiction of the Court) for representations or conduct by JNL prior to December 2012. Any pleading or claim seeking such declaratory relief prior to December 2012 is struck out.

Fresh causes of action?

[33]      As noted, in its application JNL takes issue with para 39 of the 7ASOC and also the inclusion of the “corrective disclosure” pleading.

[34]      The relevant principles as to when an amendment to a statement of claim may constitute a fresh cause of action were summarised in Transpower New Zealand Limited v Todd Energy Limited as follows:10

[61]      The relevant principles as to when a cause of action is fresh are summarised in the Ophthalmological case at [22] - [24] as follows:

(a)A cause of action is a factual situation the existence of which entitles one person to obtain a legal remedy against another (Letang v Cooper);

10     Transpower New Zealand Limited v Todd Energy Limited [2007] NZCA 302 at [61] (footnotes omitted).

(b)Only material facts are taken into account and the selection of those facts “is made at the highest level of abstraction” (Paragon Finance plc v D B Thakerar & Co (a firm));

(c)The test of whether an amended pleading is “fresh” is whether it is something “essentially different” (Chilcott v Goss citing Smith v Wilkins & Davies Construction Co Ltd). Whether there is such a change is a question of degree. The change in character could be brought about by alterations in matters of law, or of fact, or both; and

(d)A plaintiff will not be permitted, after the period of limitations has run, to set up a new case “varying so substantially” from the previous pleadings that it would involve investigation of factual or legal matters, or both, “different from what have already been raised and of which no fair warning has been given” (Chilcott at 273 noting that this test from Harris v Raggatt per Sholl J was adopted in Gabites v Australasian T & G Mutual Life Assurance Society Ltd).

[35]      The new paragraph inserted in the 5ASOC and repeated in the 7ASOC that JNL takes issue with is:11

39In the alternative, and as further pleaded in Column B of Schedule 1, in order to comply with H1.2 for both Interior Framing and Exterior Framing, LVL was and is required to have Complete Sapwood Penetration.

[36]      JNL argues that this new pleading amounts to a new, unheralded and fresh cause of action. It submits that Red Stag has maintained, since commencing the proceeding on 17 November 2017, that after December 2012 LVL had to be treated with the glueline treatment to be labelled H1.2. It could have but did not amend its pleading previously. JNL submits that it should not be required, this close to trial, to deal with interlocutory matters that will arise out of the proposed amendment. JNL suggests that the 5ASOC which first introduced para 39 failed to comply with the Court of Appeal’s order and was effectively an abuse. It should be treated as a nullity.

[37]      I do not accept the submission for JNL that the 5ASOC should be treated as a nullity. It was open to Red Stag to file the 5ASOC prior to the close of pleading date. The fact that it did not address the Court of Appeal decision, which had only been delivered a matter of days before that date, was addressed by the filing of the 6ASOC,

11     LVL is a type of engineered wood product made from wood veneer peeled from a log and glued together in layers.

which became the subject of the application for leave. Red Stag’s actions in relation to the 5ASOC fall well short of being an abuse of process so as to render it a nullity.

[38]      As to whether the pleading at para 39 introduces a fresh cause of action, the first point is that the causes of action and relief claimed remain unchanged. They remain based on breaches of the relevant provisions of the FTA. The relevant overall pleading is that from December 2012 JNL’s LVL failed to comply with H1.2. As Mr Flanagan submitted, the allegation raised in the paragraph in question is, as confirmed in the introductory words to the paragraph, an alternative to the pleading at para 38, namely as to the standards Red Stag says JNL’s LVL was required to meet to comply with H1.2 from December 2012. Paragraph 39 sets out an alternative way JNL says it did not comply. It is a further particular rather than an additional cause of action. The underlying claim is not essentially different. Nor can it be said to vary substantially from previous pleadings. It may require some further investigation of factual (and perhaps, some limited legal) matters but overall the issue will be whether JNL’s LVL complied with the relevant standard from December 2012. The nature of the claim has not changed.

[39]      In its application JNL also took issue with the “corrective disclosure” pleading. Mr Galbraith submitted that, if what was alleged was an obligation on behalf of JNL to make corrective disclosure after December 2012, it was illogical because Red Stag’s claim was that from December 2012 JNL continued to make representations that its timber complied with the standards which were false and in breach of the FTA. On the other hand, if it was suggested the “corrective disclosure” could effectively be read back so that from December 2012 and later there was an obligation to correct representations made prior to December 2012 it offended and breached the previous ruling of the Court of Appeal and was also contrary to authority.

[40]     The authorities Mr Galbraith relied on were the cases of Gosper v Re Licensing (NZ) Ltd, and Jalla v Shell International Trading and Shipping Co Ltd.12 In Gosper

12     Gosper v Re Licensing (NZ) Ltd [1998] 3 NZLR 580; and Jalla v Shell International Trading and Shipping Co Ltd [2023] UKSC 16.

the Court of Appeal rejected the submission that the continuing effect of the misrepresentation in the valuation:13

[w]hich had earlier occurred and became actionable can somehow be converted into a further actionable wrong simply because its original falsity is not corrected.

[41]      While the Court of Appeal in Gosper accepted the proposition that, in some circumstances, silence can constitute misrepresentation or misleading conduct the Court considered it had no application to that case.

[42]      Mr Galbraith also relied on the following passage from Jalla v Shell International Trading and Shipping Co Ltd in which the Supreme Court noted:14

The second point is that it follows logically from the concept of a continuing cause of action that, if the limitation period is one of six years from the accrual of the cause of action, damages at common law for a continuing nuisance cannot be recovered for causes of action (i.e for past occurrences of the continuing nuisance) that accrued more than six years before the claim was commenced: …

[43]      Mr Flanagan confirmed that Red Stag accepts the validity of the above propositions. JNL relies on the following passage from the Court of Appeal decision in the James Hardie Industries Plc v White case:15

[100] Silence can, in certain contexts, amount to misrepresentation. The issue is whether, in the particular circumstances of marketing and supply of these products, the fact of JHI’s silence affirmatively conveyed a meaning which was misleading or deceptive. We accept that if the statements were those of JHI, then a failure to correct untrue or misleading statements could well amount to conduct falling within s 9. Moreover, if JHI had lent its reputation to the product claims (which it is arguable it had) it could be expected to correct any misrepresentation. We therefore see no reason to differ from the view of Peters J that this aspect of the FTA cause of action raises a serious issue to be tried.

[44]      Given that the claim for “corrective disclosure” must be limited to correcting representations made after December 2012, ultimately the pleading for “corrective disclosure” may add little to the claim as pleaded. Given the Court of Appeal decision in this case, it cannot be applied to pursue a claim for conduct or representations prior

13     Gosper v Re Licensing (NZ) Ltd, above n 12, at p 6.

14     Jalla v Shell International Trading and Shipping Co Ltd, above n 12, at [32].

15     James Hardie Industries Plc v White [2018] NZCA 580 (footnotes omitted).

to December 2012. At most, it is, perhaps, a different way of challenging the ongoing representations alleged from December 2012. As such it does not amount to a fresh cause of action.

[45]      It follows that JNL’s challenge to para 39 in the 7ASOC (and prior to that the 5ASOC), including the related particulars in the schedule and the reference to “corrective disclosure” on the basis they raise fresh causes of action must be dismissed.

Pleadings generally

[46]      Mr Galbraith referred the Court to a recent decision of the Court of Appeal of England and Wales (Civil Division) in BB v Doha Bank Ltd.16 The Court noted a number of propositions relevant to a submission the pleadings should be struck out because they were embarrassing (in the legal sense) and abusive:

37.The particulars of claim is the means by which the claimant sets out the facts on which they rely in order to establish the essential elements of the cause of action, so that the defendant knows the case that they have to meet. It will be embarrassing if it contains irrelevant matters, and may be struck out in whole or in part for that reason alone. As James LJ in Davy v Garrett (1878) LR 7 Ch D 473 said, at 483:

“… if the Defendant is embarrassed by the Plaintiff’s mode of stating his case he is entitled to be relieved from his difficulty. Now nothing is more embarrassing to a Defendant than a number of statements which may be irrelevant, and with which he therefore does not know what to do.”

38.In Tchenguiz v Grant Thornton LLP [2015] EWHC 405 (Comm); 1 All ER (Comm) 961 Leggatt J (as he then was) said this at [1]:

“Statements of case must be concise. They must plead only material facts, meaning those necessary for the purpose of formulating a cause of action or defence, and not background facts or evidence. Still less should they contain arguments, reasons or rhetoric. These basic rules were developed long ago and have stood the test of time because they serve the vital purpose of identifying the matters which each party will need to prove by evidence at trial.”

39.That summary of the basic principles of pleading was endorsed by Males J (as he then was) in Grove Park Properties Ltd v Royal Bank of Scotland plc [2018] EWHC 3521 (Comm) at [24]. He added:

16     BB v Doha Bank Ltd [2023] EWCA Civ 253.

“It is wrong in principle to plead matters which do not support or relate to any of the remedies sought and to plead immaterial matters with a view to obtaining more extensive disclosure than might otherwise be ordered: Charter UK Limited v Nationwide Building Society[2009] 1002 (TCC) at (the second) [15]. To do so is likely to complicate or confuse the fair conduct of proceedings.”

40.Those observations, with which I respectfully agree, were approved in this Court by Snowden LJ in Re Kings Solutions Group Ltd [2022] 2 BCLC 464. Applying them to the present case, all that the Claimants needed to establish to found their cause of action under Syrian law was that the Al Khayyat brothers transferred funds from accounts held by them or by entities associated with them at the Bank, or through other accounts at the Bank, to the al-Nusra Front, and that the Bank knew or ought to have known that the funds were intended for the al- Nusra Front.

[47]      While this Court endorses those general propositions, there is also established authority that the pleading of background facts and context can be permissible. In each case, it will be a question of balance and judgment.

[48]      In its application JNL says the following aspects of the 7ASOC do not comply with the Court of Appeal judgment:

(a)Red Stag claims relief in respect of the “Representations” (7ASOC at 90-92, 94-96, 98-100, 102-104).

(b)“Representations” is a defined term. It continues to include conduct in the period prior to December 2012 (7ASOC 51-52, 54-57 and Schedules 1 and 2).

(c)Red Stag says the Representations were false or misleading. It relies in part on its interpretation of treatment requirements prior to December 2012 (7ASOC 36-37, 39 and Schedules 1 and 2).

(d)Red Stag alleges that customers relied on the Representations when they recommended, sold or purchased J-Frame with the result that J- Frame obtained a market share at Red Stag’s expense (7ASOC 58-61, 63-75, 77-78, 82-88).

(e)The claim for Representations in the period prior to December 2012 underpins all of Red Stag’s quantum claim.

[49]      Representations is defined in para 56 of the 7ASOC to include the promotional representations and identification representations which appear in paras 52 and 55 respectively.

[50]      The introductory paragraphs of the 7ASOC up to and including para 35 can be seen as providing background and context. The first contentious allegations are at paras 36 and 37. They directly plead breaches of the relevant standards prior to December 2012. On the basis of the Court of Appeal’s decision, Red Stag cannot seek relief based on any representation by JNL before December 2012 regarding compliance with the standards. Whether JNL’s LVL complied with the applicable standards before December 2012 is simply not relevant. It is not an answer to suggest JNL need not respond to the pleading. If a pleaded matter is not denied, it is treated as admitted.17 If denied, then that would potentially lead to irrelevant and inadmissible evidence being led: s 7(2), Evidence Act 2006. Also, any limited probative value of such evidence by way of background would be outweighed by the risk it would needlessly prolong the proceeding: s 8(1)(b).

[51]      Red Stag could achieve its purpose by amending its pleading to allege that as at December 2012 JNL’s LVL did not comply with the applicable standards, because from that date, JNL was incorrectly, on Red Stag’s case, representing that it complied with the standards.

[52]      When read with para 51, para 52 incorporates representations prior to December 2012. Similarly, when para 55 is read with para 54 representations prior to December 2012 are apparently put in issue. However, given Mr Flanagan’s confirmation in his written submissions that Red Stag is prevented from seeking and accordingly it does not seek to recover losses incurred as a result of JNL’s conduct between 2007 and December 2012, the pleading can be seen as contextual. The focus of the evidence at trial will necessarily be on what representations JNL made after December 2012.

[53]      The position can be further clarified by an amendment to para 56 removing the reference to the declarations and confirming the relevant time period as from December 2012 as follows:

As set out in Column C of Schedule 1, the Promotional Representations and Identification Representations (together, the Representations, which are relied upon prior to December 2012 only for background, including the fact of their

17     High Court Rules 2016, r 5.48(3).

being made, and for the purposes of seeking the declarations pleaded) were false because at the relevant times from December 2012:

Particulars

[54]      The balance of the challenges to the pleading raised by Red Stag are also met by Mr Flanagan’s confirmation on behalf of Red Stag that it is only pursuing claims based on representations after December 2012 and the consequences of those representations.

Result/orders

[55]      The 7ASOC is to be amended in accordance with the above rulings/directions. Such amended 8ASOC is to be filed and served within 10 working days of delivery of this judgment and will form the basis of the applications for the further interlocutory applications to be heard on 9 November 2023.

Costs

[56]      Both parties have had a measure of success on this application. In the circumstances costs are to lie where they fall.

Venning J