Kim v Lee & Ors (No 3)

The trial of this action commenced yesterday. The matter had been set down for five days. Shortly before 11.30am today, at the conclusion of the oral evidence, the plaintiff sought the leave of the Court to file an amended statement of claim.

The claim thus far is in the alternative. First, there is a claim for a declaration that an agreement was made between the plaintiff and the first and third to thirty-second defendants for a settlement of defamation proceedings pending in the District Court. Alternatively, a declaration is sought that an agreement was made between the plaintiff and the third defendant for the settlement of the District Court proceedings.

Again, in the alternative, a declaration is sought that, at a later date, an agreement in like terms was made between the plaintiff and the second defendant as agent for the first and third to thirty-second defendants and, alternatively to that claim, a declaration that an agreement was made between the plaintiff and the second defendant for the settlement of the District Court proceedings.

What is now sought to be introduced is a claim for damages for breach of warranty in two respects. It is sought to insert par 2A seeking damages for breach of warranty given by the third defendant to the plaintiff that the third defendant had authority to bind the first defendant to an agreement to settle the District Court proceedings and, with respect to the second defendant, what is now sought in par 4A are damages for breach of warranty given by the second defendant to the plaintiff that the second defendant had authority to bind the first defendant to an agreement to settle the District Court proceedings.

It is submitted by Mr Cotman SC, who appears for all defendants, that, if the amendments are allowed, a conflict will arise between the third defendant with respect to the first amendment and the second defendant with respect to the second amendment as against the other defendants. This will require separate representation of those defendants.

It is also pointed out by Mr Cotman that he limited his cross-examination of the plaintiff's witnesses to the alternative claims and steered away from the claims with respect to the third defendant binding the other defendants, on the one hand, and the second defendant binding the other defendants, on the other. That is because material in the affidavit of the plaintiff, that might have grounded those causes of action, was struck out.

When it comes to dealing with an application such as this, Queensland v J L Holdings Pty Ltd (1996-1997) 189 CLR 146 is authority for the proposition that one must deal with the justice of the case. In that case the High Court held that the judge at first instance, who had considered case management principles, should not have allowed those matters to outweigh her assessment of the interests of justice between the parties.

Under the Civil Procedure Act 2005, s 57 the Court may now take account of management principles, but justice between the parties is still an important factor.

The situation that arose in J L Holdings is materially different from that in the instant circumstances. There, the parties were engaged in a long running commercial dispute concerning a lease to develop certain land. The estimated length of the trial was four months. After a number of interlocutory hearings and several amendments to the defence, the defendants applied again to amend their defence. All but one of those amendments was allowed. The Judge refused leave to add a defence that, although arguable, was likely to result in the vacation of the dates that had been fixed for the trial six months ahead. The Judge considered that maintaining that date was a more pressing consideration than a party's right to present a further defence.

In the instant circumstances, the application for amendment is sought at what might be imagined to be the close of the plaintiff's case.

The High Court held that justice between the parties demanded that the amendment be allowed where a party is permitted to raise an arguable defence provided any prejudice to other parties can be compensated by costs.

In the instant circumstances, it does not seem to me that the prejudice to which I have referred can be compensated by costs. And there is the further prejudice that will be suffered by the defendants in that, if the matter is to be adjourned, my diary is such that the resumed hearing would not take place until August or September 2007. Memories have already been demonstrated in cross-examination to be failing and a further adjournment of that order is likely to exacerbate that situation.

While I am of the view that the claims for breach of warranty of authority are arguable, I am also of the view that the justice of the matter demands that the amendment be refused. At this late juncture the prejudice likely to be suffered by the defendants cannot be compensated by an order for costs in their favour.

I therefore decline to give leave to file in Court the amended statement of claim.