Supreme Court New South Wales Medium Neutral Citation: Ahn v Toppro Pty Ltd [2014] NSWSC 1699 Hearing dates: Friday 28 November 2014 Date of orders: 28 November 2014 Decision date: 28 November 2014 Jurisdiction: Equity Division - Corporations List Before: Brereton J Decision: Amended statement of claim struck out Catchwords: PROCEDURE – pleading – documents – necessity to plead effect of document and not merely incorporate by reference Category: Procedural and other rulings Parties: Raphael Ahn (first plaintiff) Il Nam Yoo (second plaintiff) Toppro Pty Ltd (first defendant) Ok Ja Joo (second defendant) Jae Joo Kim (third defendant) Representation: Counsel: Mr T Bland (plaintiffs) Mr S O'Brien (first to third defendants) Solicitors: Strathfield Law (plaintiffs) Alpha Lawyers (first to third defendants) File Number(s): 2014/186025 Judgment (ex tempore) 1. HIS HONOUR: By interlocutory process filed on 21 November 2014, the second defendant Ok Ja Joo applies for an order joining Wealth Wisdom Investments Ltd as fourth defendant, and an order setting aside paras 1 through 8 of the plaintiffs' notice to produce of 10 November 2014. The plaintiffs do not oppose - although they do not consent - to an order that Wealth Wisdom Investments Ltd be joined and have leave to file a cross-claim. Accordingly, I will make that order. After the close of the defendants' submissions, the plaintiffs indicated that they did not press paras 1 through 8 of the notice to produce. Accordingly, I will order that those paragraphs be set aside. 2. In the course of preparing for the hearing, I have had cause to read the amended statement of claim filed 7 November 2014. It contains numerous deficiencies and difficulties. The cause of action on which the plaintiffs wish to rely is really a relatively simple one. As it seems to me, it boils down to this: first, that, as alleged in para 1, on or about 30 April 2012 the second plaintiff acquired all the shares in the first defendant Toppro; secondly, that, as alleged in para 13, in or about May 2013 the second plaintiff, upon the basis of certain representations made to him by one Joon Won Choi, who is not a party, executed a share transfer on the basis that it would be returned duly signed by a transferee with a payment of US$12,000; thirdly, as alleged in para 20, that the transfer was not completed within a reasonable time or at all and the second plaintiff formed the view that no sale was to proceed and, thereafter, in about December 2013 appointed the first plaintiff as a director; fourthly, that subsequently, the second defendant, who it now seems controls the proposed transferee Wealth Wisdom Investments Ltd, altered the identity of the transferee on the transfer and caused particulars of the transfer to be recorded by ASIC and subsequently sought to change the directors and take control of the company. 3. The plaintiff contends that the transfer is void. The defendants, at least as I understand their defence, say that they received a transfer executed by the plaintiffs partly in blank, which they completed as authorised and have now tendered the payment anticipated and that as a result one or other of Ok Ja Joo or Wealth Wisdom is entitled to be registered as shareholder. 4. Separately, the plaintiff claims in paras 38 and following that he was employed by the first defendant, that the first defendant repudiated the contract by dismissing him wrongfully, that he has accepted the repudiation and claims damages. 5. I have sought to summarise what I understand to be the complaint because, as it seems to me, the statement of claim presently contains many matters which are not material facts in the cause of action. In addition, it contains passages, for example, in para 14: "As if pleaded hereto in full for the full force effect and the unaltered share transfer document appended to this pleading." Not only is no document appended to the pleading, but that is an entirely impermissible way of pleading a document. To the extent that the terms of a document are relevant, the effect relied on must be pleaded in the pleading, and note merely incorporated by reference. 6. It should not be overlooked that there are similar problems with the defence. It is not clear whether it is pleaded that there was an agreement made in May 2012. If, as I think is intended, it is alleged that the signed transfer was handed over in escrow, the terms of the escrow are not pleaded with any clarity. Paragraph 36 simply alleges that on 3 September 2014 Alpha Lawyers presented a further amended version of the share transfer document, upon which further amendments had been made. The particulars thereto contain assertions which are not particulars of the allegation in para 36 but culminate in a claim for damages – arising on what cause of action, on what basis, and against whom, is entirely not apparent. 7. I think the best course is to strike out the statement of claim in toto, on the basis that it should be properly repleaded. 8. The Court therefore orders that: 1. Wealth Wisdom Investments Ltd be added as fourth defendant. 2. Paragraphs 1 through 8 of the plaintiffs' notice to produce dated 10 November 2014 be set aside. 3. The amended statement of claim be struck out, with leave to replead. 4. The fourth defendant have leave to file a cross-claim. 5. The plaintiff have leave to file a cross-claim by 15 December 2014. 6. The plaintiff file and serve any further amended statement of claim by 15 December 2014. 7. The proceedings be adjourned to 9 February 2015 at 10am in the Corporations Judge Directions List. 8. The plaintiff pay the defendants' costs of the interlocutory process and any costs thrown away by the further amendment of the statement of claim. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 05 February 2015