Silver v Dome Resources NL [2006] NSWSC 189

New South Wales Supreme Court

CITATION : Silver v Dome Resources NL [2006] NSWSC 189

HEARING DATE(S) : 6 March 2006

JUDGMENT DATE : 6 March 2006

JURISDICTION : Equity

JUDGMENT OF : Hamilton J

DECISION : Reversion to abandoned causes of action and further amendment of statement of claim allowed.

CATCHWORDS : PROCEDURE [101] - Supreme Court procedure - Practice under Uniform Civil Procedure Rules - Amendment - Relevant considerations - Whether dictates of justice may best be satisfied by allowing or refusing amendment.

CASES CITED : Silver v Dome Resources NL [2006] NSWSC 26

Michael Bernard Silver (P1 & XD1) PARTIES : Fair Choice Limited (P2 & XD2) Dome Resources NL (D1 & XC1) Durban Roodepoort Deep Limited (D2 & XC2)

FILE NUMBER(S) : SC 2586/01

COUNSEL : J E Thomson (Ps & XDs) T G R Parker SC (Ds & XCs)

SOLICITORS : Bull, Son & Schmidt (Ps & XDs) Allens Arthur Robinson (Ds & XCs)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

HAMILTON J

MONDAY, 6 MARCH 2006

2586/01 MICHAEL BERNARD SILVER & ANOR v DOME RESOURCES NL & ORS JUDGMENT 1 HIS HONOUR: This case has followed a tortuous course, particularly as to pleadings. There have been a number of applications for late amendment of pleadings and it has been necessary to consider earlier and it is now necessary to consider again whether the dictates of justice are best satisfied by granting or refusing these late amendments. 2 The last occasion I had to do so was in a judgement delivered on 3 February this year (Silver v Dome Resources NL [2006] NSWSC 26 ("my judgment")), where I dealt with the defendants' entitlement to rely on three different contentions by way of defence; whether or not amendments to pleadings were necessary; and whether, if so, they ought to be allowed. 3 The instance most relevant to the present matter is argument (1) referred to in [3] of my judgment. This has been called "the privity argument". It is an argument that judgment could not be entered in the second plaintiff's favour in respect of any breach by the defendants of their obligations under the retirement deeds because the second plaintiff (and its predecessor in title) were not parties to those deeds. 4 I ruled that this was an argument of law that was open without having been adverted to in the defendants' pleadings. I ruled in [12] of my judgment that argument (1) should not be precluded because no relevant prejudice to the plaintiffs was shown. 5 Application is now made by the plaintiffs, as a result of that ruling, to rely upon three causes of action which they abandoned during the course of the trial, one in estoppel and two arising out of the provisions of the Trade Practices Act 1974 (Cth) ("the TPA"). The plaintiffs also apply to make a further amendment to their amended statement of claim. 6 The plaintiffs abandoned the three causes of action in open court on 5 May 2005. The present application is supported by an affidavit of the plaintiffs' solicitor, Mr Marucci, who deposes that when the defendants' reliance on the privity argument was announced in open court by Mr Parker, of Senior Counsel for the defendants, on 14 September 2005 during the course of oral submissions, that was the first time that the argument had been raised in the proceedings on the defendants' behalf. The defendants served written submissions on 27 September 2005 which, in paragraphs 89A to 89D, set out and formalised those submissions. The plaintiffs adverted in their further written submissions of 8 November 2005 to the fact that the decision not to pursue the abandoned causes of action was influenced by the defendants' failure to raise the privity argument up to the time they were abandoned and it was also foreshadowed in those submissions that, if the privity argument is permitted, the reinstatement of the abandoned claims would probably require an application further to amend the pleadings. 7 I have set the above matters out by way of background, perhaps in more detail than is strictly necessary, because Mr Parker concedes that, in all the circumstances, the plaintiffs ought be allowed to reinstate the abandoned causes of action. However, the delivery of judgment is rendered necessary by the fact that, despite the fact that he does not object to the resurrection of the causes of action, he does object to the amendments now sought. The basis on which he objects to those amendments is that he submits that, in the case of each of the causes of action, the representation now sought to be relied on is different from the representation relied on in relation to the causes of action as originally pleaded. 8 This is quite clear in the case of the TPA causes of action, where previously the plaintiffs relied on oral representations made before the execution of the deeds, whereas they now rely upon representations made in the deeds themselves. The substitution of representations is not quite so clear in the case of the cause of action in estoppel, by reason of the language used. But it may well be that the same is true there, because the representation in the pleading in its original form was certainly alleged to have been made before the entry into the deed, rather than upon it being entered into. 9 Here (and this is to be contrasted with what I said about the defendants' course of action in [14] of my judgment), evidence has been given of the plaintiffs' lawyers' course of action that is relevant to the application. It does appear that no consideration was given to the form of the pleading in this regard until the privity argument was announced by Mr Parker on 14 September 2005. However, it was only when that occurred and the potential need to revert to these causes of action arose, that the form of the pleading was considered. 10 I have been told that this amendment will not lead to the plaintiffs seeking to add to their evidence. However, the defendants, whose counsel had carried out some cross examination on the subject matter of reliance, relating to the causes of action based on representations, will feel the need to cross examine the first plaintiff further, should the amendment be allowed in this form. 11 Mr Silver is now resident in London but further cross examination, which should not be too lengthy, can be afforded by video link. 12 Mr Parker presses that the change in course that will be effected, if the amendment is allowed, ought not be permitted at this stage of the proceedings. He draws my attention to my own remarks about lateness in my judgment. They are certainly not irrelevant and the decision is a close one. However, I bear in mind that evidence has been laid before me that suggests that the plaintiffs' course was shaped by the lack of adversion by the defendants to the privity point until late in the case. It was only after this that attention was refocused on the abandoned causes of action and their form. 13 The representations now to be relied on, although different from those earlier pleaded, are not material new to the case. They are contained in the deeds sued upon and the extension of the hearing will be only by cross examination of one witness, who is a party and who is readily available, albeit by video link. This is all in a context where the revival of the abandoned causes of actions is not opposed, although, as I have made plain, the allowance of the amendment is strongly objected to. 14 The conclusion I have come to is that the dictates of justice will be best served in this instance by permitting the amendments sought. I grant leave to the plaintiffs to file in court a further amended statement of claim. An affidavit verifying it should be brought forward in due course. I order that the plaintiffs pay the defendants' costs thrown away by the amendment.