SIALEPIS v IRONAID PTY LTD & ORS SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL GLEESON CJ, HANDLEY and COLE JJA 25 November 1997 [1997] NSWCA 285 Gleeson CJ, Handley and Cole JJA Mr Jacobs QC, leading counsel for the appellant, applies to make a further amendment to the Further Amended Summons in this matter in terms of a document initialled by me, dated with today's date, and placed with the papers. The Court is of the view that the application to amend should be refused. What I am about to announce are our joint reasons for that refusal. We are in the course of hearing an appeal by Mrs Sialepis against an order made by Rolfe J in the Commercial Division dismissing, pursuant to the provisions of Ptl3 r6, her claim against three of eight defendants in certain proceedings in the Commercial Division. The three defendants in question are the respondents to this appeal. The proceedings are continuing against the other defendants and they have taken no part in the present appeal. At the risk of some oversimplification, it can be said, sufficiently for present purposes, that the structure of the claim being made by Mrs Sialepis against the three defendants with whom we are concerned is as follows. There are, broadly speaking, two principal aspects of the claim. The first aspect of the claim concerns a transaction in 1992 under which the Sialepis family home at Cronulla was mortgaged to the Westpac Bank. Mrs Sialepis owned a one third share in that house, and her husband and her mother-in-law respectively owned one third shares. In her claim against her husband, and against the bank, who are also defendants in these proceedings, she alleges that she signed a mortgage to the bank over the Cronulla property in 1992 as a result of certain misrepresentations that were made to her by her husband and an officer of the bank. It is unnecessary for present purposes to go into the detail of those alleged misrepresentations. There is no suggestion in the pleading that any of the respondents to this appeal had any involvement in that 1992 transaction. Indeed the corporate respondent to this appeal was not incorporated at the time. The second aspect of the claim made by Mrs Sialepis relates to an assignment in May 1995 by Westpac of certain mortgages held by Westpac over properties owned by Mr Sialepis and Sialepis Pty Ltd to secure debts to Westpac in a total of about $14,000,000. Those securities were assigned to Ironaid for a consideration of about $4,000,000. The appellant's explanation of why Westpac was content to assign the securities for only $4,000,000 is to be found in various allegations in the pleading which alleged financial difficulties under which Mr Sialepis and Sialepis Pty Ltd were labouring, in the words of the pleading "at all relevant times". It is alleged against Ironaid and Mr and Mrs Cosco, the directors of Ironaid, (those three being the respondents to this appeal), that the purpose and effect of the assignment of May 1995 from Westpac to Ironaid was to defeat a pending claim by Mrs Sialepis in the Family Court. That claim had been commenced in 2 UNREPORTED JUDGMENTS 1994. How the assignment might have defeated the claim is something of a mystery, but it is not necessary to go into that now. It should be mentioned at this stage that the Further Amended Summons which was before Rolfe J represented the sixth attempt by the legal representatives of Mrs Sialepis to formulate her claim against the present respondent. It is against that background that the seventh attempt represented by the proposed amendment with which this judgment is dealing, has been made. The proposed amendments, in effect, seek to introduce in relation to the Cronulla property a completely new allegation, which had not been mentioned in any of the pleadings to date, and which was not mentioned in the pleading being considered by Rolfe J. It is, in substance, an allegation to the effect that part of the purpose of the May 1995 transfer from Westpac to Ironaid was to cure the alleged defect in the 1992 mortgage over the Cronulla property, which was known to Ironaid and to Mr and Mrs Cosco. In support of the application to amend, Senior Counsel for the appellant has referred us to some of the evidence that was before Rolfe J relating to the circumstances of the May 1995 transfer and, in particular, he has referred us to correspondence which asserts, in general terms, that Mr Cosco was aware that there was litigation pending between Mrs Sialepis and her ex-husband, and that included in the matters in dispute was the Cronulla property. There is nothing in that material which shows or suggests that Mr Cosco knew of the matters alleged in the pleading to produce the consequence that the transaction between Westpac and the owners of the Cronulla property had been procured by misrepresentation. Nor is there anything in that letter to suggest that Mr Cosco knew or intended that the transfer of May 1995 would operate in some way to cure a defect in the 1992 transaction. These are proceedings which have already been protracted and expensive to all parties. The legal representatives of Mrs Sialepis have had repeated opportunities to formulate an intelligible, and at least superficially plausible claim, against the present three respondents. Now, in the course of the hearing of an appeal against an order dismissing the entire claim against the three respondents, an attempt is made for the first time to introduce a completely new basis, unsupported by the evidence, for a proposed challenge to one part of the May 1995 transaction. The view of the Court is that in all the circumstances of the case the application for amendment should be refused.