Wily v Rothschild [1999] NSWSC 920

New South Wales Supreme Court CITATION : Wily v Rothschild [1999] NSWSC 920 revised - 10/09/99 CURRENT JURISDICTION : Equity FILE NUMBER(S) : 2625 of 1996 HEARING DATE(S) : 31 August 1999 JUDGMENT DATE : 10 September 1999

High Jenner Wily in his capacity as Liquidator of AUR NL (In Liquidation) (First Plaintiff) PARTIES : AUR NL (In Liquidation) (Second Plaintiff) Rothschild Australia Limited (Defendant) JUDGMENT OF : Windeyer J at 1

COUNSEL : Mr. I.D. Faulkner (Plaintiffs) Mr. D.L. Williams (Defendant) SOLICITORS : Argle Partnership (Plaintiffs) Middleton Moore Bevins (Defendant) CATCHWORDS : PRACTICE AND PROCEDURE - amendment of statement of claim after hearing concluded. Amendment allowed ACTS CITED : Companies (New South Wales) Code ss368 Supreme Court Rules Pt20 r1, r4(5) DECISION : Amendment allowed

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IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

WINDEYER J

Friday 10 September 1999

2625/96 HUGH JENNER WILY in his capacity as Liquidator of AUR NL (IN LIQUIDATION), AUR NL (IN LIQUIDATION) v RAL AUSTRALIA

JUDGMENT on application to amend 1 By notice of motion filed in court on 24 August 1999 the plaintiff seeks leave to amend the statement of claim. 2 It is necessary to give some short history. By the original statement of claim the liquidator sought to set aside a particular transaction which took place on 3 July 1990 as being void against the liquidator pursuant to s368 of the Companies (New South Wales) Code as a transaction occurring after the commencement of the winding up of AUR NL (In Liquidation), that commencement being some time on 3 July 1990, when the summons for winding up was filed. The allegation in the statement of claim that this transaction took place after the commencement of the winding up was not admitted by the defendant in it defence. No attention was directed to this matter during the hearing and no evidence was adduced to establish that the impugned transaction took place after the commencement of the winding up. Neither counsel addressed this matter during closing submissions. When I was preparing my judgment I realised that there was no evidence which would establish the impugned transaction took place after the commencement of the winding up. I decided it was appropriate to relist the matter to ascertain whether or not this matter was really in issue because counsel for the defendant had never argued that the defendant must succeed because the plaintiff had not made out the pleaded case. The matter was relisted on 17 August when counsel for the defendant informed me that there was no admission and claimed that on that basis alone the defendant was entitled to succeed on this particular claim. While there can be no doubt that no argument was addressed to this matter, in my view that does not preclude the defendant from relying upon failure by the plaintiff to prove its pleaded case, that being the point of pleadings, unless there is some indication or some statement made that a particular matter is not in issue. It is for the party presenting a case to obtain any admission necessary or to prove the facts necessary to entitle it to the relief sought. 3 There was no application for amendment on 17 August but shortly thereafter the plaintiff filed the notice of motion the subject of these reasons which on the return day on 24 August was stood over until 31 August. The amendment then propounded by the plaintiff was to put forward an alternative claim, alleging that the transaction took place prior to the commencement of the winding up but was void against the liquidator as a preference. On 24 August, when the notice of motion was first returnable it was stated that there would be no application to adduce any additional evidence. The position then was on the pleading sought to be propounded that there were alternative claims and no evidence of the facts necessary to establish the claim one way or the other, namely whether the impugned transaction took place before or after the commencement of the winding up, although it was established the transactions took place on the same day. 4 After some discussion on 31 August it was accepted by counsel for the plaintiff that if an amendment were to be made it would require further redrafting. To avoid any further delay it was agreed that the plaintiff would prepare a new form of amended statement of claim, which would be deemed to be the document covered by the notice of motion and the defendant would prepare a defence to that document, and that both documents would be sent to me and marked as exhibits and I would prepare my judgment on the basis that the claim the plaintiff was making was to amend the statement of claim in accordance with the document which became an exhibit. In those circumstances I have marked the amended statement of claim as Exhibit Y and the proposed defence to that document as Exhibit Z. It was agreed that whether or not I allowed the amendment I should proceed to judgment in the substantive proceedings immediately upon determining the fate of the application for amendment. In other words there was to be no further evidence and no further argument. 5 The amendment sought to be made so far as is relevant pleads first that the transaction took place after the commencement of the winding up; second and in the alternative, that it took place prior to the commencement of the winding up and is void as a preference and thirdly, in the further alternative, that it took place on 3 July 1990 and whether occurring before or after the commencement of the winding up was void against the liquidator. 6 The question now is whether the amendment should be allowed. The impugned transaction took place on any basis on 3 July 1990. These proceedings were commenced by statement of claim filed on 2 July 1996, in other words one day before the limitation period expired. It follows that if the court is to allow the amendment, exercising its discretion in favour of the plaintiff, it does so in the circumstances where the amendment is sought after conclusion of the hearing and because I sought clarification as to whether there had been some concession, and secondly in circumstances where if the amendment were not allowed any claim would be barred by time, thus bringing into account the provisions of Pt 20 r4(5) and of course the general power of amendment under Pt 20 r1. 7 With some hesitation I have concluded that the amendment ought to be allowed. Although it is an amendment sought in the face of what would otherwise be defeat, it is I think clear and accepted that the plaintiff cannot establish on the evidence whether the impugned transaction took place before or after the commencement of the winding up, and neither can the court determine this on any probability basis on the evidence before it. I should say that I find this position most extraordinary because I have little doubt that access to the file in the winding up proceedings and access to records relating to the impugned transaction could establish which took place first. The plaintiff for whatever reason, and possibly to increase the chance of obtaining the amendment sought, has eschewed the opportunity to seek leave to adduce additional evidence. It follows from this that the defendant is not prejudiced through being unable to obtain evidence one way or the other. It further follows that it is only if the plaintiff's claim that it is entitled to recoup the moneys whether or not the transaction took place before or after the commencement of the winding up that is of real significance in dealing with the amendments sought. There is, of course, substantial prejudice to any party entitled to win on the pleadings as they stand being faced with an amendment which might give the plaintiff a possibility of success. On the other hand it does seem to me that the case falls within Pt 20 r4(5) because the facts are substantially the same, the only difference being a question of timing on a particular day. I also consider that some attention should be given to the fact that counsel for the defendant addressed no argument to the lack of proof, perhaps because it escaped his attention or perhaps because he decided to leave it to me and hope I picked it up. Parties who leave matters to chance in that way are, I think, more susceptible to a court allowing an amendment and I propose do so. 8 The orders are as follows