Federal Court of Australia

General Trade Industries Pty Ltd (in liquidation) v AGL Energy Limited (No 3) [2024] FCA 492

ORDERS

THE COURT ORDERS THAT:

1.    The applicant is granted leave to amend its further amended originating application by filing the second further amended originating application exhibited to the affidavit of Harrison Humphries affirmed 5 February 2024 at exhibit “HJH-29”, excluding:

(a)    paragraphs 1, 5, 6, 7, and 8; and

(b)    the words “not less than” in paragraphs 2, 3 and 4.

2.    The applicant is granted leave to amend its further amended statement of claim by filing the second further amended statement of claim exhibited to the affidavit of Harrison Humphries affirmed 5 February 2024 at exhibit “HJH-30” excluding:

(a)    paragraphs 26A to 26F, 33(ae), 41A to 41K and 57A;

(b)    the words “not less than” in paragraphs 29, 32, 33(c)(iiiA), 33(ec), 41(c) and 67; and

(c)    Annexure A.

3.    On or before 21 May 2024, the applicant must file and serve the second further amended originating application and the second further amended statement of claim for which leave has been granted by Orders 1 and 2 above.

4.    On or before 11 June 2024, the respondent must file a defence to the second further amended statement of claim.

5.    The matter be listed for a case management hearing at 9:00 am on 20 June 2024.

6.    The applicant pay the respondent’s costs of the application, to be taxed if not agreed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

DERRINGTON J:

Introduction

1    The applicant, General Trade Industries Pty Ltd (in liquidation) (General Trade), seeks leave to further amend its originating application and statement of claim in this matter. Leave is sought in respect of the statement of claim because it has amended that document previously: see r 8.21 of the Federal Court Rules 2011 (Cth) (the Rules). Leave is otherwise required to make an amendment to the originating application: see rr 16.51 and 16.53 of the Rules.

2    The proposed amendments are extensive and whilst the respondent, AGL Energy Limited (AGL), does not oppose a substantial number of them, it does oppose certain ones which will have the effect of widening the dispute between the parties by substantially expanding the scope of existing claims or by adding new causes of action.

Background

3    The specific circumstances of the disputation between the parties need not be repeated. They are set out in an earlier judgment in General Trade Industries Pty Ltd (in liquidation) v AGL Energy Limited (No 2) [2023] FCA 556. However, in order to contextualise the areas of dispute, it is necessary to outline in brief terms the nature of the parties’ relationship.

4    On 20 December 2013, AGL and General Trade entered into a construction contract in the form of an amended version of the AS4000-1997 General Conditions of Contract. Pursuant to it, General Trade agreed to provide civil, electrical and mechanical works for the construction of gas retention facilities at AGL’s Wallumbilla LPG Plant and Silver Springs Plant. The contract was a fixed price contract with the amount payable by AGL being $12,005,579.46. That price was based on General Trade’s tender submission.

5    From the beginning of the contract, many variations to the scope of the contract works were required by AGL.

6    By mid-2014 the parties were in dispute. A period of negotiation followed, during which General Trade served AGL with a statutory demand in respect of amounts which it claimed were owing under the contract.

7    Subsequently, through their solicitors, the parties negotiated a settlement of General Trade’s claims, following which a “Deed of Release” was entered into on 13 August 2014 (the Deed). Relevantly, by the Deed:

(a)    AGL agreed to pay General Trade a further sum of $6,642,103, excluding GST, in full and final settlement of the dispute. That payment was in addition to some $20.8 million, excluding GST, which had already been paid under the contract;

(b)    AGL and General Trade acknowledged and agreed that the amount of $27.5 million constituted the full amount that General Trade was entitled to under or in connection with the contract for the work performed up to and including 31 July 2014. The Deed also indicated that General Trade would have no entitlement to any further payment under or in connection with the contract and AGL would have no further liability to General Trade other than as provided for in cl 1 of the Deed. That clause contained AGL’s payment obligations and an acknowledgment that the payment represented General Trade’s full entitlement; and

(c)    AGL and General Trade gave mutual releases (excluding cll 2A, 5, 29, 34.6 and 35 of the contract relating to warranties and defects, which the parties expressly agreed would continue to have effect).

8    The settlement sum was paid by AGL in accordance with the Deed.

9    In the current proceedings, General Trade claims payment of further amounts for work which it says was completed under the contract up until the date of the Deed, as well as for work which it says was completed after entry into the Deed.

10    AGL denies any liability to pay General Trade any further amounts.

11    The current proceedings were commenced on 12 August 2020.

The steps in the litigation

12    It is necessary to briefly recite the history of the current proceedings and, in particular, that relating to the amendments which General Trade has made to its pleadings over time.

13    The draft originating application and draft statement of claim in respect of which leave to amend is sought are the fourth versions of each of those documents. It is not unfair to observe that the relief sought by General Trade in these proceedings has not insubstantially vacillated over time. In particular, by the present application it seeks to include causes of action which it has previously sought and abandoned.

14    The initial statement of claim filed on 13 August 2020 was relatively brief, being only 13 pages in length. The allegations made therein advanced seven different claims for relief. The substance of General Trade’s case was that AGL had breached the contract by directing General Trade to leave the site; that AGL was estopped from asserting that the Deed had the effect of ending the contract because of submissions allegedly made in other proceedings in which AGL opposed General Trade’s application for the release of security bonds; that by refusing to pay General Trade for further work, AGL knew that General Trade would be rendered insolvent and intended to bring about that result; and that AGL’s conduct caused General Trade to lose its business opportunities and that the goodwill and value of it was destroyed.

15    On 29 October 2020, General Trade was required to pay $70,000 as security for costs and the proceedings were stayed pending the provision of that security. General Trade paid the security amount in mid-March 2021.

16    On 30 September 2021, leave was given for General Trade to file and serve an amended originating application and an amended statement of claim. As at that time, General Trade’s position was that the construction of the Deed was not in issue between the parties.

17    In late October 2021, General Trade filed the amended originating application and amended statement of claim. Those documents advanced claims which concerned, inter alia, the construction of the Deed, as well as a claim to recover an amount upon a quantum meruit. However, claims which had appeared in the first iteration of the statement of claim for unjust enrichment, an account of profits, misleading and deceptive conduct and loss of use of money, were removed.

18    On 3 November 2021, AGL’s solicitors wrote to General Trade’s solicitors indicating that the amended pleadings contained numerous deficiencies and invited the filing of a further amended pleading.

19    On 8 November 2021, General Trade’s solicitors indicated that they were in the process of engaging counsel and anticipated being in a position to deliver a further amended statement of claim, if required, by the end of that week.

20    On 25 November 2021, General Trade was given leave to file and serve a further amended originating application and further amended statement of claim by 11 February 2022. That leave was not opposed by AGL.

21    General Trade was granted three extensions of the time to deliver the amended documents, being until 11 April 2022, 12 May 2022 and then 1 June 2022. AGL consented to each of these extensions.

22    Ultimately, on 2 June 2022, it filed the further amended originating application and further amended statement of claim. That was some eight months after it had stated that it would engage counsel to consider the amendments.

23    Subsequent to the filing of those amended documents, further interlocutory steps, including an application by AGL for the provision of further security, occurred.

24    At the present stage of the proceedings, discovery has been completed by the parties. No orders have yet been made for the delivery of evidence.

25    On 1 November 2023, the solicitors for General Trade wrote to AGL’s solicitors proposing that General Trade be given leave to amend its further amended originating application and further amended statement of claim by consent. That was rejected by AGL.

26    On 2 November 2023, orders were made that General Trade file and serve any application for leave to amend by 24 November 2023.

27    On 24 November 2023, General Trade filed the application but did not deliver any affidavit in support or a draft pleading. It provided AGL with a draft second further amended statement of claim on 7 December 2023.

28    This latest draft of the pleading is some 55 pages in length, not including its annexures. Relevantly, it includes:

(a)    a plea of the existence of a collateral agreement and damages for its breach in the sum of $109,213.50 (being a new claim for extra work said to have been done prior to the execution of the Deed) and also in the sum of $1.195 million (in respect of work said to have been done after the Deed was entered into);

(b)    a claim for restitution on the basis of a quantum meruit for $4.314 million. This relates to work allegedly done prior to the date on which the Deed was entered into;

(c)    a claim for misleading or deceptive conduct arising from the making of representations which allegedly caused General Trade to enter into the Deed, and a corresponding claim for damages in the amount of $4.314 million;

(d)    relief in the nature of declarations that the Deed is void as a result of the alleged misleading or deceptive conduct or unconscionable conduct; and

(e)    an expansion of the quantum of its claim for damages by the insertion of the words, “not less than”, before each allegation of a specified figure for the quantum of relief. That relief was not persisted with on the hearing of the application.

Principles relevant to amendments

29    Rule 8.21 of the Rules provides:

8.21    Amendment generally

(1)    An applicant may apply to the Court for leave to amend an originating application for any reason, including:

…

(g)    to add or substitute a new claim for relief, or a new foundation in law for a claim for relief, that arises:

(i)    out of the same facts or substantially the same facts as those already pleaded to support an existing claim for relief by the applicant; or

(ii)    in whole or in part, out of facts or matters that have occurred or arisen since the start of the proceeding.

(2)    An applicant may apply to the Court for leave to amend an originating application in accordance with paragraph (1)(c), (d), (e) or subparagraph (g)(i) even if the application is made after the end of any relevant period of limitation applying at the date the proceeding was started.

(3)    However, an applicant must not apply to amend an originating application in accordance with subparagraph (1)(g)(ii) after the time within which any statute that limits the time within which a proceeding may be started has expired.

(Notes omitted).

30    Rule 16.53 provides:

16.53    Application for leave to amend

(1)    Unless rule 16.51 applies, a party must apply for the leave of the Court to amend a pleading.

(2)    A party may apply under subrule (1) for leave to amend a pleading to add or substitute a new claim for relief, or a new foundation in law for a claim for relief that arises out of the same facts or substantially the same facts as those already pleaded to support an existing claim for relief by the party, even if the application is made after the end of any relevant period of limitation applying at the date the proceeding was started.

…

31    It seems to be well accepted that the Rules permit the Court to allow amendments to an originating application and statement of claim in respect of claims arising out of the same facts or substantially the same facts as those already pleaded, even where that will have the effect of extending the period of limitation in respect of such claims: see Voxson Pty Ltd v Telstra Corporation Ltd (No 7) (2017) 343 ALR 681; McGraw-Hill Financial Inc v Clurname Pty Ltd (2017) 123 ACSR 467, 474 [23].

32    On the other hand, it has been held that if the relevant period of limitation had expired at the date the proceeding was started, leave should not be granted on the basis that the new claims for relief arise out of the same or substantially the same facts because, in those circumstances, that cause of action is obviously futile and the Court should not allow hopeless amendments: Global Brand Marketing Inc v Cube Footwear Pty Ltd (2005) 66 IPR 19, 23 [12]; Plaintiff P1/2003 v Ruddock (2007) 157 FCR 518, 524 – 525 [12] – [15]; see also Caason Investments Pty Ltd v Cao (2015) 236 FCR 322, 326 [21].

33    Whilst the power to grant or refuse an application to amend under rr 8.21(1) and 16.53 is discretionary, that discretion must involve the consideration of the overarching purpose of the Rules set out in s 37M of the Federal Court of Australia Act 1976 (Cth) (Federal Court Act). It provides:

37M    The overarching purpose of civil practice and procedure provisions

(1)    The overarching purpose of the civil practice and procedure provisions is to facilitate the just resolution of disputes:

(a)    according to law; and

(b)    as quickly, inexpensively and efficiently as possible.

(2)    Without limiting the generality of subsection (1), the overarching purpose includes the following objectives:

(a)    the just determination of all proceedings before the Court;

(b)    the efficient use of the judicial and administrative resources available for the purposes of the Court;

(c)    the efficient disposal of the Court’s overall caseload;

(d)    the disposal of all proceedings in a timely manner;

(e)    the resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute.

(3)    The civil practice and procedure provisions must be interpreted and applied, and any power conferred or duty imposed by them (including the power to make Rules of Court) must be exercised or carried out, in the way that best promotes the overarching purpose.

(4)    The civil practice and procedure provisions are the following, so far as they apply in relation to civil proceedings:

(a)    the Rules of Court made under this Act;

(b)    any other provision made by or under this Act or any other Act with respect to the practice and procedure of the Court.

(Emphasis in original).

34    The obligations imposed upon litigants by s 37N of the Federal Court Act are also relevant:

37N    Parties to act consistently with the overarching purpose

(1)    The parties to a civil proceeding before the Court must conduct the proceeding (including negotiations for settlement of the dispute to which the proceeding relates) in a way that is consistent with the overarching purpose.

(2)    A party’s lawyer must, in the conduct of a civil proceeding before the Court (including negotiations for settlement) on the party’s behalf:

(a)    take account of the duty imposed on the party by subsection (1); and

(b)     assist the party to comply with the duty.

(3)     The Court or a Judge may, for the purpose of enabling a party to comply with the duty imposed by subsection (1), require the party’s lawyer to give the party an estimate of:

(a)     the likely duration of the proceeding or part of the proceeding; and

(b)     the likely amount of costs that the party will have to pay in connection with the proceeding or part of the proceeding, including:

(i)     the costs that the lawyer will charge to the party; and

(ii)     any other costs that the party will have to pay in the event that the party is unsuccessful in the proceeding or part of the proceeding.

(4)     In exercising the discretion to award costs in a civil proceeding, the Court or a Judge must take account of any failure to comply with the duty imposed by subsection (1) or (2).

(5)     If the Court or a Judge orders a lawyer to bear costs personally because of a failure to comply with the duty imposed by subsection (2), the lawyer must not recover the costs from his or her client.

35    It is generally accepted that, on an application for leave to amend, the onus is on the party seeking the amendments to persuade the Court that leave should be given: Dye v Commonwealth Securities Limited [2010] FCAFC 118 [17]. It is also accepted that the principles relevant to such applications are those which were referred to in Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 (Aon). They include:

(a)    the nature and importance of the amendment to the party applying for it: Aon at 214 [102];

(b)    the extent of the delay and the costs associated with the amendment: Aon at 214 [102];

(c)    the prejudice that might be assumed to follow from the amendment, and that which is shown: Aon at 182 [5] and 214 [100], [102];

(d)    the explanation for any delay in applying for leave to amend: Aon at 215 [102] – [103] and 216 [108];

(e)    the parties’ choices to date in the litigation and the consequences of those choices: Aon at 217 [112];

(f)    the detriment to other litigants in the Court: Aon at 211 [93], 212 [95] and 217 – 218 [114]; and

(g)    the potential loss of public confidence in the legal system which can arise where a court is seen to accede to applications made without adequate explanation or justification: Aon at 182 [5], 189 [24] and 192 [30].

36    Necessarily, the weight to be accorded to each consideration in any particular case, either individually or in combination with others, and the outcome of the balancing process may vary according to the particular facts and circumstances of the case at hand: Cement Australia Pty Ltd v Australian Competition and Consumer Commission (2010) 187 FCR 261, 275 – 276 [51].

AGL’s opposition to the amendments

37    AGL opposed the making of the amendments on several grounds. Some relied upon propositions relating to the making of amendments generally and others concerned matters specific to the particular proposed amendment. It is appropriate to begin by considering the broader grounds of opposition, a number of which relied for support upon the observations of the Full Court in Tamaya Resources Ltd v Deloitte Touche Tohmatsu (2016) 332 ALR 199 (Tamaya v Deloitte Touche).

Lack of explanation for delay and adequate time to plead

38    A significant issue in this case is the lack of any explanation for the delay in bringing forth the claims sought to be made in the amendments which are opposed. This factor has long been regarded as an important issue on any application for leave: see Tamaya v Deloitte Touche at 218 [101] – [103].

39    The proceedings were commenced on 12 August 2020, which is more than three and a half years ago, and there have been three earlier iterations of the statement of claim. It necessarily follows that the delay in advancing the claims now sought to be brought is substantial and General Trade has not provided any explanation for it. A very short statement in an affidavit made by Mr Humphries, the solicitor for General Trade, indicated that barristers engaged for General Trade had reviewed the pleadings and recommended that the amendments be made. He deposed also that the need for the amendments became apparent to him during the process of preparing particulars of the further amended statement of claim pursuant to a request from AGL.

40    Those statements are insufficient. They do not indicate why the claims which are now sought to be advanced were not made earlier in the proceedings, whether they had come to light previously, and whether any previous decision had been made that they should not have been brought at an earlier time. This is particularly important where some of the claims in respect of which leave is now sought have appeared in earlier versions of the pleading, but were then deleted. That fact is evidence of some prior forensic decision to jettison certain claims on the basis that they were regarded as not worth pursuing. That similar claims are now sought to be made suggests the existence of some other forensic decision which is inconsistent with the first. It follows that General Trade has previously had the opportunity to fully consider those claims in detail and, that being the case, a good reason would usually be required to justify giving leave to raise them now. If, for instance, there was an indication that the proposed amendments had arisen out of facts which have only recently been discovered, some lenience might have been shown. However, the above matters indicate that the relevant facts, and the availability of the causes of action have been known to General Trade from a very early time and possibly from the commencement of the action.

41    It is also relevant that General Trade’s solicitors have previously indicated that earlier iterations of the pleading had been prepared with the assistance of counsel. That allays any suggestion that General Trade has not had the opportunity to be adequately advised about the claims which were available to it and those which it should seek to vindicate.

42    A further factor which exacerbates the absence of any explanation for the delay in this case is that General Trade has had more than a sufficient opportunity to plead its case. It has had multiple attempts to plead over an extended period and it is not suggested that there existed any inhibitions on it from doing so.

43    It is a matter of curiosity that, though the interlocutory stages of these proceedings have shown that General Trade, which is in liquidation, has a paucity of funds it might apply to the furtherance of the action, it did not raise that as a reason for its inability or omission to bring the propounded claims earlier.

44    In these circumstances, the unexplained delay in pleading the claims which are now sought to be advanced, and in respect of which General Trade has had an adequate time to plead, is a significant factor in the exercise of the discretion and a major hurdle to the granting of leave.

Nature and importance of the amendments

45    In neither the evidence nor the submissions was any explanation provided as to the nature and importance of the proposed amendments: see Tamaya v Deloitte Touche at 214 – 216 [79] – [88].

46    Whilst it is not necessary for there to be evidence of the importance of a proposed amendment where its import is not self-evident, it would be of assistance were some evidence to be adduced as to why a certain amendment is relevant in the particular circumstances of the case.

47    In the present matter, it is fair to observe that the proposed amendments are, prima facie, sound in the sense that they seem to advance an arguable case. It was not suggested otherwise. However, the new claims sought to be added effectively duplicate the damages claims already in existence. One might infer that what is sought to be achieved by the application is to buttress the existing claims with alternatives as a matter of precaution. That, however, is speculation and it remains unclear why the amendments are needed. It was not said that the action would fail or be at risk of failing if they were not allowed.

48    In the result, it has not been demonstrated that the proposed new claims are sufficiently important to General Trade’s case or that they have some particular value, so as to justify their addition to the present proceedings.

Irrecoverable costs

49    An unusual feature of this case is that General Trade is in liquidation and has no funds. It is, as has been found in the course of previous interlocutory applications, unlikely to be able to meet an order for costs should that be so ordered. In the ordinary course, where a party seeks to amend their pleading, the opposite party’s prejudice is alleviated, to an extent, by the order that it receive payment of the costs occasioned by the amendment and any costs thrown away. Here, that prejudice is unlikely to be alleviated. The costs of responding to the amended pleading in this case would be not insubstantial, although I do not accept that they would reach anything near the figure suggested in the evidence. Nevertheless, AGL would not recover these costs even if it was successful in the action.

50    It is also noted that General Trade made no offer to ensure that AGL is not out of pocket by reason of having to respond to any amended pleading.

51    It follows that the irrevocable prejudice which might be suffered by AGL as a result of granting leave to amend is a further substantial impediment to granting leave in this case.

Inevitable impact of delays and prejudice

52    The prejudice which a party might suffer by the other’s making of an amendment is an important factor in the exercise of the Court’s discretion: see Tamaya v Deloitte Touche at 216 – 217 [89] – [94].

53    In this case, some of the events which are the subject of the proposed amendments occurred between nine and eleven years ago. In particular, the proposed amendments seek to rely upon the content of certain conversations from that time. This has a number of consequences. First, there may well be persons who might have been able to give evidence in relation to those conversations who cannot now be located. There is a real risk that at least some of those named in the pleading as having attended the meetings have changed their employment and moved away. Secondly, it is relevant that the passage of time will likely have impacted the recollection of persons who may be potential witnesses in relation to the factual issues now sought to be raised. In relation to this, the question is what would be the witnesses’ likely state of recollection if the amendments were allowed. It is not merely a matter of asking the degree to which their recollection will have faded since the commencement of the action, some three and a half years ago. The principal prejudice to be examined is not the prejudice occasioned by the procedural delay in bringing forth the amendments, although that is relevant. It is the prejudice that the amendments will themselves occasion if granted: Tamaya v Deloitte Touche at 216 [91]. On that metric, it is highly likely that the recollection of any person who participated in, or was privy to, the conversations on which General Trade now seek to rely, will have faded substantially, if not totally. That would be particularly so if they have not hitherto been asked to consider those conversations.

54    These circumstances further weigh against allowing the proposed amendments. If they were allowed, there is a real risk that AGL would suffer irreparable prejudice by being unable to meet the allegations against it by the evidence of persons who may have been able to provide assistance had the claims been brought earlier.

Inefficiency in the conduct of the litigation

55    AGL further submitted that the manner in which General Trade has conducted the litigation weighs against granting leave to make further amendments. This submission is directed to the overall justice of allowing the amendments; in particular, it directs attention to the prior conduct of the litigation as an indication of how the litigation will be conducted in the future. On this issue, one assessment involves ascertaining whether allowing the amendments would permit the proceedings to be conducted in a manner which is not “as quickly, inexpensively and efficiently as possible”: see Tamaya v Deloitte Touche at 217 – 218 [96] – [100].

56    General Trade advanced a claim for misleading or deceptive conduct in the first iteration of the statement of claim and then abandoned it, but now seeks to resurrect it. It has done the same with certain aspects of its quantum meruit claims. Further, it had previously indicated that the construction of the Deed was not in issue before the Court and yet now that emerges as a factor in the proposed amendments. This vacillation in the nature of the claims advanced has not been explained and nor has it been justified. There is, therefore, force in the submission that to allow the proposed amendments would have the consequence of permitting the litigation to be conducted in a manner inconsistent with ss 37M and 37N of the Federal Court Act.

57    The question of whether General Trade is acting consistently with the requirements of ss 37M and 37N requires an assessment of the issues raised previously and, in particular, the lateness of the amendments and whether the applicant has had more than a sufficient opportunity in which to plead its case: see Tamaya v Deloitte Touche at 218 [101] – [103]. On a consideration of those matters, the manner of the prosecution of General Trade’s case has been sporadic at best and desultory at worst, although that observation should be tempered by the knowledge that it is somewhat bereft of funds which necessarily impedes its ability to progress the litigation with any great speed.

58    Nevertheless, parties are not entitled to litigate at their leisure. Whilst they are to have a fair and reasonable opportunity to plead their case, it is not limitless. Here, where General Trade has amended its pleadings on a number of previous occasions, it cannot be said that it has not had that opportunity. To accord it yet a further chance to plead would be an unreasonable indulgence in the circumstances of this case, particularly in the absence of any relevant explanation as indicated above.

59    It was also submitted that if the proposed amendments were made it will require further discovery and whilst that is true, it is difficult to gauge its extent. It otherwise cannot be doubted that allowing the amendments would also require further pleadings and necessarily delay the hearing of the matter, though that circumstance would have greater impact were it not for the fact that AGL did not oppose numerous other amendments which will cause the matter to be delayed in any event.

60    Overall, the manner in which the litigation has been conducted to date has the consequence that, were the proposed amendments to be allowed, the prescripts of ss 37M and 37N would not be met. That weighs heavily against granting leave.

The proximity of the matter to trial

61    One factor that favours the grant of leave to amend is that the matter has proceeded so slowly that it is far from ready for trial. No trial date has been set and directions have not yet been made for the exchange of evidence: see Tamaya v Deloitte Touche at 219 – 220 [104] – [113]. Had the matter been ready for trial and set down for hearing, that would have rendered it almost impossible to grant leave. However, the converse does not mean that the discretion should be exercised in General Trade’s favour. In this case, where there are significant factors weighing against granting leave, the fact that the matter is not ready for trial does not have any significant impact.

Conclusion on general considerations

62    The foregoing analysis necessitates, at a general level, that the discretion to grant leave be refused in this case. The amendments are substantive and seek to raise factual matters which occurred nearly a decade ago, in circumstances where there is little likelihood that any person involved in the events would have any recollection of them. If the amendments were allowed, it would put AGL at a significant disadvantage in defending the claims raised. General Trade has had more than a sufficient opportunity to plead its case and no explanation has been provided for the circumstances in which it now seeks to advance new claims. Further, the relative importance of the proposed new claims was not self-evident and nor was it explained. It may simply be that they are intended to buttress the existing claims out of a heightened sense of caution. In the particular circumstances of this case, it is likely that AGL will suffer irreparable damage if leave is granted because it will never be able to recover the additional costs to which it will be put, even if it succeeds in the action. Conversely, General Trade faces no such difficulties if it is successful. To allow the proposed amendments will inevitably further delay this litigation which has, to date, not been conducted with due speed or efficiency. No doubt that has been partly caused by a lack of funds and, although that might be a reason, it does not excuse it. In these circumstances, and even though the matter is neither set down for trial nor have directions been made for the exchange of evidence, General Trade has not established that the discretion to give leave to make the proposed amendments should be exercised in its favour.

The specific amendments

63    It is appropriate to now turn to the specific amendments which are sought and opposed for the purposes of ascertaining whether their particular characteristics might relevantly affect the exercise of the discretion.

Collateral agreement amendments: [26A] – [26D], [26F]

64    By these proposed amendments, General Trade seeks to raise the existence of an agreement which is said to be collateral to the Deed which was entered into on 13 August 2014. The proposed amendments allege that on 13 August 2014, prior to the execution of the Deed, during a meeting between Mr Pike, General Trade’s director, and Mr Robertson of AGL, discussions were had as to the effect of the Deed. Comments were also said to have been made about what would occur if the Deed was not signed. It is then pleaded that following that meeting, Mr Robertson of AGL sent Mr Pike two emails. The first indicated that AGL and the superintendent of the works would review any submission of extra work completed after 31 July 2014 in accordance with the terms and conditions of the contract, and the second indicated that AGL would raise a purchase order in the amount of $99,285 as payment for claimed extra work. Thereafter, the Deed was executed. On the basis of this alleged collateral contract, it is then said that it was breached by AGL’s failure to review subsequent submissions and pay $99,285 to General Trade for the claimed additional work.

65    The essential complaint about this plea is that, not only is it too late, but it would also require AGL to make enquiries of Mr Robertson in respect of communications which occurred ten years previously. There is much force in that submission. The new cause of action relies on the content of a conversation said to have occurred at that time, and the detriment which naturally flows from raising such matters so long after the event, looms large. Memories will have faded and witnesses may have disappeared.

66    In these circumstances, where the detriment to AGL would be so great, the particular nature of the plea does not sufficiently weigh in favour of granting leave.

The knowledge amendment: [33(ae)]

67    This proposed amendment concerns the addition of a subparagraph to an existing plea of unconscionable conduct. In particular, it is said that the circumstances of unconscionable conduct included the fact that AGL was aware, at the time of entering into the contract, that, in order to complete the project, General Trade would be required to complete works significantly beyond the scope of work specified in the contract. In part, what is relied upon is the contents of a meeting which occurred on 23 December 2013, where that recognition was discussed.

68    Unsurprisingly, the main complaint is that this proposed particular relates to matters which happened so long in the past that, even if AGL could locate the relevant persons involved, they are unlikely to have any sufficient recollection of those matters. The potential irredeemable prejudice to AGL is not overcome by any perceived importance to General Trade of adding this particular to the existing wide-ranging plea of unconscionable conduct.

69    There is nothing in this proposed amendment which alters the conclusion that flows from the general considerations discussed above.

First alternative quantum meruit amendments: [41A] – [41H]

70    By these amendments, General Trade seeks to raise a quantum meruit claim in the alternative to a claim already in existence that it is entitled to be paid in respect of variations to the contract. It is advanced on the assumption that the variations to the contract did not bind the parties. By the proposed claim it is said that the work was undertaken between 20 December 2013 and 4 April 2014, that the reasonable costs of that work is at least $4.314 million, and that the non-payment of that amount is unjust or unconscionable.

71    It is to be recognised that this claim relates to work agreed to be done and performed prior to the entry into of the Deed in August 2014, and there is a risk that any claim for payment might be barred by its terms.

72    The claim is described as the “first” alternative quantum meruit claim as the current iteration of the pleadings includes a further claim for quantum meruit in respect of works which were said to have been later carried out. The amount sought in that respect is $1.195 million, and that relates to demobilisation works, works following certain demobilisation directions, additional directed works and what are referred to as “MDR” works.

73    AGL opposed these proposed amendments specifically on the ground that the claim for quantum meruit was out of time as at the commencement of the proceedings on 13 August 2020. It was submitted on behalf of General Trade that the amendments should be allowed despite the apparent expiration of the relevant limitation period, because the limitation period operates as a defence rather than a bar on the making of the claim, and that is a matter to be determined on the pleadings. Though there was no indication of how the limitation defence might be defeated, there are possible justifications for allowing the amendment and waiting to see if an effective limitation defence is raised.

74    On the other hand, there is the extra consideration of both the unexplained lateness of the plea and the fact that an earlier claim for payment on a quantum meruit in respect of the works prior to entry into the Deed appeared in the amended statement of claim filed in October 2021, but was removed in the further amended statement of claim. No attempt has been made to explain the removal of the earlier plea and the present attempt to reinstate it. The absence of any relevant explanation in circumstances where General Trade has had more than a sufficient opportunity to plead its case is significant here. Again, the importance of the new claim for a quantum meruit was not explained.

75    In such circumstances, there is nothing particular in relation to the plea of quantum meruit which justifies its addition at this stage of the proceedings.

Misleading and deceptive conduct amendments: [26E], [41I] – [41K]

76    A further misleading and deceptive conduct claim is sought to be raised by these proposed amendments and it is made in the alternative to the collateral contract claim. It is alleged that Mr Robertson made misrepresentations to General Trade as to a future matter, being how AGL would deal with General Trade’s claims for future work, and that in reliance on that representation it entered into the Deed. It is said that had the representation not been made, General Trade would not have entered into the Deed and would have been entitled to recover a total of $31.814 million in respect of its performance of the work under the original contract. As a result, it claims it has suffered loss and damage in the amount of $4.314 million.

77    Again, complaint is made that General Trade pleaded a misleading or deceptive conduct claim in relation to this matter in the original statement of claim, subsequently removed it in the amended statement of claim, and now seeks to re-enliven it without any explanation. In the context of the general considerations referred to above, there is nothing in the nature of the proposed new cause of action for misleading or deceptive conduct which overcomes the fact that, were the amendment to be allowed at this point, it would have the effect of allowing General Trade to conduct the litigation in a manner contrary to the requirements of ss 37M and 37N of the Federal Court Act.

78    Again, there is nothing particular about the specifics of this claim which would justify the exercise of the Court’s discretion to give leave to raise it at this stage.

Payment claim 12 amendment: [57A]

79    By this amendment, General Trade alleges that AGL was obliged to pay payment claim 12 issued by General Trade because of the terms of the collateral agreement or, alternatively, because a new contract was formed in relation to it. Leave should be refused in respect of this amendment because, in part, it relies on the alternative collateral contract claim in respect of which leave has been denied. Secondly, it also relies on a further contract claim which is out of time and, importantly, General Trade has offered no explanation as to why it was not previously raised despite having had a surfeit of opportunity to do so.

80    There is nothing in this proposed claim which outweighs the general considerations referred to above. Leave in relation to it should also be refused.

Annexure A amendments

81    General Trade seeks to amend Annexure A to its pleading. That Annexure was originally a schedule identifying the variation work done, the value of the variation claims, and how they were said to be payable by AGL. The proposed amendment appears to seek to include all of General Trade’s variation claims made throughout the course of the contract, rather than those on which it had specifically relied previously.

82    AGL complained that this amendment appears to generate an expansion of General Trade’s case and that is the major opposition to it, though it is not precisely clear to which pleaded cause of action the proposed additions to Annexure A are directed.

83    As best as can be ascertained, it appears that General Trade is seeking to greatly expand its case to dispute every variation which occurred during the course of the contract. In that context, the lack of explanation of the relevance of the proposed amendment tells strongly against granting leave.

84    It was also submitted that the proposed new causes of action based on additional variations to the original contract do not arise out of the same or substantially the same facts as the old causes of action. That should be accepted. A claim based on one variation of a contract does not arise out of the same set of facts as a claim based upon another separate variation. That is so regardless of the fact that they may both relate to a series of variations to the same contract. The causes of action are separated by both time and substance.

85    As mentioned, it appears that by this proposed amendment, General Trade seeks to call into dispute each of the variations made over the course of the contract. It may be that it was for that reason, that it sought to broaden the quantum of its claims by adding the words “not less than” before the identified quantum of the claim where it appeared. That is the best complexion that can be put on the proposed amendment as the relevance of the list of variations in Annexure A to the several claims made in the proposed amended statement of claim, otherwise remains unclear.

86    Ultimately, the purpose of amending Annexure A was not adequately explained. As best as could be ascertained it was an attempt to expand the contract variation case in some ambiguous manner. There is nothing in the nature of this claim which weighs in favour of exercising the discretion to grant leave to allow its being included in the pleading.

Quantum of relief amendments

87    In numerous places in the pleading, amendments were sought to be made by inserting the words “not less than” in a number of places. This was apparently designed to give flexibility to the quantum of the relief which might be obtained. It was an inappropriate form of pleading and, as mentioned, leave to amend in that respect was rightly abandoned at the hearing. Nothing further needs to be said in respect of these amendments.

Conclusion

88    It follows that, to the extent to which the proposed amendments to the originating application and the statement of claim were opposed, they should not be allowed. To the extent to which they were not opposed, it is appropriate to allow them, even though they will cause some further delay to the progression of the proceedings.

89    To the extent to which the amendments are allowed they are identified in the orders at the commencement of these reasons.

90    As AGL was successful in defeating the amendments which it opposed, it should have its costs of the application.

Associate:    

Dated:    14 May 2024