Federal Court of Australia

Altrad Australia Pty Ltd v Dropulich [2025] FCA 342

ORDERS

THE COURT ORDERS THAT:

Identification of issues, pleadings and strike-out

1.    The Federal Court (Corporations) Rules 2000 (Cth) not apply and only the Federal Court Rules 2011 (Cth) apply to the proceeding.

2.    The originating application filed 5 December 2024 stand as the originating process in the proceeding.

3.    The identification of the issues in this proceeding be on pleadings.

4.    The minute of proposed further amended statement of claim filed 26 March 2025 stand as the statement of claim in the proceeding and, otherwise, the interlocutory application for leave to further amend the statement of claim filed 26 March 2025 be dismissed with no order as to costs.

5.    The minutes of proposed orders filed by the first and third respondent on 14 March 2025 be treated as applications to strike-out the statement of claim referred to in paragraph 4 of these orders under r 16.21 of the Federal Court Rules.

6.    The applications referred to in paragraph 5 of these orders be dismissed.

7.    The first and third respondents pay the applicants’ costs of the applications referred to in paragraph 5 of these orders and costs of the case management hearing on 2 April 2025 to be taxed if not agreed.

8.    By 4.30pm (AWST) on 17 April 2025 the applicants file and serve their statement of claim in the form of the minute of proposed further amended statement of claim filed on 26 March 2025.

9.    By 4.30pm (AWST) on 8 May 2025 the respondents file and serve their defences.

10.    By 4.30pm (AWST) on 22 May 2025 the applicants file and serve any replies to the defences.

Discovery

11.    By 4.30pm (AWST) on 19 June 2025 the parties give standard discovery.

12.    By 4.30pm (AWST) on 24 April 2025:

(a)    the parties file an agreed protocol for the exchange and discovery of electronic documents and any discovery plan; or failing agreement,

(b)    the applicants file the protocol and any discovery plan to which they are prepared to agree and the respondents, each or together, file a protocol and discovery plan to which they are prepared to agree marked up to identify the differences between the applicants’ proposal and the respondents’ proposal(s); and

(c)    each party file and serve a short written outline of submissions (limited to three pages) in support of that party's proposal and opposition to the other party’s proposal.

Expert evidence

13.    By 4.30pm (AWST) on 19 June 2025 the applicants file and serve a draft expert brief for each person the applicants intend calling to give expert evidence at the trial on particular issues.

14.    The applicants’ draft expert brief is to include the following:

(a)    a list of the assumptions that each witness is to be instructed to make in the preparation of the expert evidence;

(b)    a list of the documents or other material each witness will be requested to consider in the preparation of the expert evidence; and

(c)    a list of the questions upon which each witness will be requested to opine in the expert evidence.

15.    By 4.30pm (AWST) on 10 July 2025 each respondent file and serve a draft expert brief for each person that respondent intends calling to give expert evidence at the trial on particular issues.

16.    Any respondent draft expert brief filed and served in accordance with paragraph 15 of these orders must include the information referred to in paragraph 14 and, if and to the extent that it is different from a draft expert brief of the applicants, mark-up the part(s) where the respondent expert brief differs from that of the applicants’ draft brief.

Interlocutory disputes

17. Except in cases of urgency or with leave of the Court, paragraphs 18 to 21 of these orders are to apply to any interlocutory process filed in the proceedings and, in particular, a party is not to file any interlocutory process unless that party has first complied with paragraph 18 of these orders.

18.    If any interlocutory dispute arises between any of the parties, their respective legal representatives are to confer in-person (or by telephone or video-link) and attempt to resolve the dispute within three business days of the dispute arising.

19.    If the dispute has not been resolved after the parties’ legal representatives have conferred in an attempt to resolve it, the party seeking the interlocutory order may then file an interlocutory process.

20.    The party seeking the interlocutory order must file and serve with the interlocutory process:

(a)    a short note (no more than 2 pages) stating:

(i)    that parties have conferred in accordance with paragraph 18 of these orders;

(ii)    the matters the subject of the interlocutory process that are agreed or that are not in issue or dispute between the parties; and

(iii)    the matters the subject of the interlocutory process that remain in issue or are in dispute between the parties,

and

(b)    a short outline of submissions (no more than 5 pages) in support of the application.

21.    If the party seeking the interlocutory order has complied with paragraphs 18 and 20 of these orders, the party opposing the interlocutory order is to file and serve a short outline of submissions (no more than 5 pages) in opposition to the application.

Non-compliance with case management orders

22.    In the event of default by any party for five business days in complying with a case management order for the taking of any interlocutory step, the solicitor for the party in default is to submit to the solicitor for each other party a proposed revised timetable for the interlocutory steps outstanding. (If a party in default has previously defaulted, the period of five business days is reduced to two business days.)

23.    Upon receipt of the revised timetable, the solicitor for each party is, as soon as reasonably practicable, to inform that solicitor’s client:

(a)    of the existing timetable;

(b)    of the fact of the default; and

(c)    the proposed revised timetable,

and obtain the client's instructions as to whether the client consents to the proposed revised timetable.

24.    Upon receipt of the client's instructions, the solicitor for each party is, as soon as reasonably practicable, to inform the solicitors for the party in default of those instructions.

25.    If all parties consent to the proposed revised timetable, the party in default is to file a minute of consent orders with the Court and, pending the Court making the orders by consent, the interlocutory steps are to proceed in accordance with the agreed revised timetable.

26.    If not all parties consent to the proposed revised timetable, the solicitor for the party in default is, as soon as reasonably practicable, to request the matter be relisted for a case management hearing so that appropriate orders may then be made.

General

27.    By 4.30pm (AWST) on 17 April 2025 the parties give notice to the Court of their unavailable dates for a trial of up to 10 days for February, March, April, May and June 2026.

28.    The parties have liberty to apply on 48 hours’ written notice to re-list the case management hearing for such further or other directions or orders as may be requested.

29.    The case management hearing be re-listed at 9.15am (AWST) on 23 July 2025.

30.    No later than 4.30pm (AWST) on 18 July 2025 the parties file and serve an agreed or competing minute(s) of proposed orders for the remaining interlocutory steps in the proceeding together with a document indicating the number of lay and expert witnesses each party intends calling to give evidence at the trial.

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

REASONS FOR JUDGMENT

FEUTRILL J:

Introduction

1    These reasons concern applications to strike-out certain paragraphs of the statement of claim and case management of the proceeding. Before dealing with the strike-out applications, it is necessary to address regularising the proceeding because, as will be explained shortly, it was not initiated by the correct procedure.

2    The originating application together with a statement of claim was filed on 5 December 2024. An amended statement of claim was filed on 10 February 2025. At a case management hearing on 5 March 2025, it became clear that the first and third respondents considered certain paragraphs of the amended statement of claim should be struck out. As a consequence, orders were made directing the respondents to file minutes of proposed orders identifying the paragraphs to which objection was taken and the grounds of objection and written submissions in support of the proposed orders. The first and third respondents filed the relevant documents. In the meantime, the applicants filed an application for leave to further amend the statement of claim and written submissions in response to those of the first and third respondents.

3    It emerged from the procedure described in the preceding paragraph that the applicants should have commenced the proceeding under the Federal Court (Corporations) Rules 2000 (Cth) because the proceeding is under the Corporations Act 2001 (Cth) and Australian Securities and Investments Commission Act 2001 (Cth). However, it was common ground that the Corporations Rules are inapposite for determination of the issues that arise in the proceeding and it is appropriate that the matter proceed on pleadings. Therefore, I will make orders to the effect that the Corporations Rules do not apply and only the Federal Court Rules 2011 (Cth) apply to the proceeding, that the filed originating process stand as the originating process in the proceeding and that the issues in the proceeding be determined on pleadings.

4    A consequence of the matters referred to in the preceding paragraph is that the statement of claim and amended statement of claim were irregularly filed and, in effect, the applicants do not require leave to amend the statement of claim because the statements of claim they have filed should not have been accepted for filing due to the irregularity of the proceeding. To address this anomaly, I will make an order that the further amended statement of claim stand as the applicants’ statement of claim in the proceeding. I will then deal with the minutes of proposed orders as applications to strike out that statement of claim.

5    As the further amended statement of claim addresses certain of the first respondent’s complaints, the paragraphs the subject of the applications to strike-out are reduced to paras 8(b), 42 – 46 and 48 of the statement of claim. The asserted grounds for striking out these paragraphs were that they are evasive or ambiguous [r 16.21(1)(c)] and are likely to cause prejudice, embarrassment or delay in the proceeding [r 16.21(1)(d)]. Further, in the course of his oral submissions, counsel for the first respondent submitted that para 42 should also be struck out for failing to disclose any reasonably arguable cause of action [r 16.21(1)(e)].

6    For the reasons that follow, the applications to strike-out should be dismissed with costs.

Applicable principles

7    The principles applicable to applications to strike-out pleadings are well established and need not be restated at any length. The relevant question for the purposes of the applications before me is whether the statement of claim (the pleaded material facts and particulars) meet the basic requirement of stating the applicants’ case with sufficient clarity to allow the respondents a fair opportunity to meet it. The answer to that question is influenced by s 37M of the Federal Court of Australia Act 1976 (Cth) and an understanding that contemporary case management will involve pre-trial exchanges of witness statements, expert evidence and lists of the documents upon which the parties intend to rely at trial. In these circumstances, the prospect of ‘surprise’ or ‘trial by ambush’ is quite unlikely. As I have previously said, having regard to these matters, the relevant question may be answered at the threshold by asking whether a lawyer looking at the pleading, genuinely interested in knowing what issues are to be tried and the case that has to be met, would have any difficulty in ascertaining those matters: Austin Engineering Ltd v Podulova (No 3) [2024] FCA 1001 at [46]; Barclay Mowlem Construction Ltd v Dampier Port Authority [2006] WASC 281; 33 WAR 82 at [10] (Martin CJ). Nevertheless, well established as they are, having regard to the nature of the objections taken to the statement of claim and the manner in which the arguments were presented, it is useful to elaborate on certain of the relevant principles.

8    As already mentioned, the first and third respondents invoke rr 16.21(1)(c), 16.21(1)(d) and 16.21(1)(e) as grounds for objecting to the statement of claim. As to r 16.21(1)(d), a pleading is likely to cause prejudice or embarrassment if it is susceptible to various meanings, contains inconsistent allegations, includes various alternatives which are confusingly intermixed, contains irrelevant allegations or includes defects which result in it being unintelligible, ambiguous or vague or too general. Such a pleading could equally be characterised as evasive or ambiguous for the purposes of r 16.21(1)(c). As to r 16.21(1)(e), a reasonable cause of action is a cause of action that has some prospects of success having regard to the allegations pleaded. A pleading may be struck out for disclosing no reasonable cause of action if, accepting all material facts pleaded as true and that on all other points (except points of law) the pleading is unassailable, it would not be open to the party upon the pleading to prove facts at trial that would constitute a cause of action. However, a cause of action cannot be struck out merely on the basis that it appears to be weak. Inevitably there is overlap between the grounds in rr 16.21(c), 16.21(d) and 16.21(e): e.g., Pigozzo v Mineral Resources Ltd [2022] FCA 1166 at [25(8)], [25(11)], [25(12)], [25(13)] (Feutrill J) and the authorities there cited.

9    As a focus of the objection to para 48 of the statement of claim centred on an assertion of an absence of pleaded material facts, it is also useful to re-state the purpose and differences between material facts, particulars and evidence.

10    Rule 16.02(1) of the Rules provides:

(1)    A pleading must:

…

(b)    be as brief as the nature of the case permits; and

(c)    identify the issues that the party wants the Court to resolve; and

(d)    state the material facts on which a party relies that are necessary to give the opposing party fair notice of the case to be made against that party at trial, but not the evidence by which the material facts are to be proved; and

(e)    state the provisions of any statute relied on; and

(f)    state the specific relief sought or claimed.

(Emphasis added.)

11    Rule 16.41 provides that a party must state in a pleading particulars of each claim pleaded. Rules 16.42 – 16.44 require certain particulars to be given relating to fraud, misrepresentation etc., conditions of mind and damages. Rule 16.45 provides that if a pleading does not give a party fair notice of the case to be made against that party at trial and, as a result, that party may be prejudiced in the conduct of that party’s case, the party may apply to the Court for an order that the pleading party serve on the party particulars of the claim or a statement of the nature of the case relied on.

12    Facts are ‘material’ if they are necessary for the purpose of formulating a complete cause of action. Although also a statement of facts, and not evidence, the function of particulars is different. As r 16.45 suggests, the function of particulars is to ‘fill in the picture of the [applicants’] cause of action with information sufficiently detailed to put the [respondents] on [their] guard as to the case that [they have] to meet and to enable [them] to prepare for trial.’ Particulars are not used to fill in gaps in the material facts. Yet, in practice, it is not always easy to distinguish between a fact that is material and a particular piece of information which it is necessary to give a respondent in order to inform the respondent of the case to be met: Bruce v Odhams Press Ltd [1936] 1 KB 697 at 712-713. Apart from cases where the parties choose to disregard the pleadings and fight the case on issues chosen at trial, the relief which may be granted to a party must be founded on the pleadings. The pleadings (material facts and particulars) define the issues for decision in the litigation and thereby enable the relevance and admissibility of evidence to be determined at trial, but, nevertheless, particulars may be amended after the evidence at trial has closed: Dare v Pulham [1982] HCA 70; 148 CLR 658 at 664. While particulars define the issues and the scope of evidence, they are not the evidence or a description of the evidence by which the facts alleged are to be proved.

13    There is, no doubt, a tension between drawing a pleading that is as brief as the nature of the case permits and giving fair notice of the case that has to be met. While a party may desire unlimited information about an opposing party’s case, that party is entitled to no more information than that which is necessary to afford the party fair notice of the case to be met. It seems to me that many pleadings disputes, including the one at hand, could be avoided if parties appreciated and took heed of the difference between desire and entitlement.

The applicants’ claim in brief

14    The applicants allege that the first applicant (Altrad Australia) is a wholly owned subsidiary of the second applicant (Altrad). Altrad Australia acquired about 98% of the issued shares in the third applicant (Valmec) pursuant to a scheme of arrangement implemented under s 411 of the Corporations Act in October 2021.

15    The applicants alleged that the first respondent (Mr Dropulich) was the managing director of Valmec in the period preceding implementation of the scheme. The second respondent (Mr Zurhaar) was the non-executive chair of Valmec in that period. The third respondent (Mr Singh) was the company secretary and chief financial officer of Valmec in that period. That each of the respondents was also a qualified chartered accountant.

16    The applicants allege that the respondents made certain representations about Valmec’s earnings before interest, taxation, depreciation and amortisation (EBITDA) for the financial year ended 30 June 2021. The alleged representations were made before 30 June 2021 and, to that extent, were representations as to future matters and also were made after 30 June 2021 and, to that extent, were representations as to a then existing state of affairs.

17    The applicants allege that Altrad and Altrad Australia relied on the pre-30 June 2021 representations to calculate the offer price for the scheme and scheme consideration, enter into the scheme implementation deed and acquire the shares in Valmec. That Altrad Australia relied on the post-30 June 2021 representations to proceed with the scheme transaction and not terminate it in accordance with its terms, complete the transaction and pay the scheme consideration and Altrad relied on those representations to provide Altrad Australia with the funds for the scheme consideration.

18    With respect to the pre-30 June 2021 representations the applicants allege that these were representations as to future matters for which the respondents had no reasonable grounds and that the representations are taken to be misleading by s 12BB(1) of the ASIC Act. With respect to the post-30 June 2021 representations the applicants allege that these were false in that Valmec’s EBITDA was less than the amount represented ($12 million).

19    The applicants allege that the respondents engaged in conduct that was misleading or deceptive or was likely to mislead or deceive in contravention of s 1041H(1) of the Corporations Act or s 12DA(1) of the ASIC Act. Further, Altrad and (or) Altrad Australia suffered loss or damage in that each or both were induced to pay the scheme consideration that was more than the value of that consideration.

20    The applicants also allege that Valmec’s annual report, preliminary financial report and written records failed to give a true and fair view of Valmec’s financial position and performance in accordance with s 297 and s 286 of the Corporations Act and, thereby, Mr Dropulich and Mr Zurhaar contravened s 344(1) of the Corporations Act. The applicants claim a declaration to that effect under s 21 of the Federal Court Act, compensation pursuant to s 1317H of the Corporations Act, and damages pursuant to s 1041I of the Corporations Act or s 12GF of the ASIC Act.

The respondents’ objections

21    Mr Dropulich objects to paras 42, 45 and 46 of the statement of claim. Mr Singh also objects to these paragraphs and, in addition, objects to para 43 and para 44. Each objection is substantially the same and can be addressed by dealing with the objection to para 42.

22    Paragraph 42 pleads:

In the context of the circumstances pleaded in paragraphs 4, 6 and 8(b) above and by the conduct of Mr Dropulich and Mr Singh pleaded in paragraph 9 above, they each and together represented that Valmec's forecast normalised EBITDA for FY21 as at 2 June 2021 was $12,518,749.

23    Paragraph 4 and para 6 plead characteristics of Mr Dropulich and Mr Singh; namely their positions and qualifications as chartered accountants. Paragraph 8 pleads facts relating to due diligence including the establishment of a dataroom for Altrad’s information and review and face to face discussions with Mr Zurhaar, Mr Dropulich and Mr Singh to understand the content and context of the information provided. Specifically, para 8(b) (to which objection is also taken) pleads that Altrad commenced due diligence on Valmec that included ‘meetings and face to face discussions with Mr Zurhaar, Mr Dropulich, Mr Singh and Valmec’s advisors to understand the content and context of the information provided’.

24    Paragraph 9 pleads:

After consulting with Mr Dropulich in relation to an excel spreadsheet titled "FY21 Forecast Position" (FY21 Forecast Spreadsheet) Mr Singh had prepared, on or around 2 June 2021 Mr Singh uploaded into the Dataroom Valmec's FY21 Forecast Spreadsheet which identified a forecast figure of $16,518,749 for earnings before interest, tax, depreciation and amortisation (EBITDA) for the financial year ending 30 June 2021 (FY21) and a Normalised EBITDA for FY21 of $12,518,749.

Particulars

Email from Mr Singh to Mr Dropulich on 2 June 2021 at 4:24 pm

Email from Mr Singh to Mr Dropulich on 2 June 2021 at 4:32 pm

Email from Mr Singh to Mr Dropulich on 2 June 2021 at 4:36 pm

Email from Mr Dropulich to Mr Singh on 2 June 2021 at 4:42 pm

Ansarada Project Ore Dataroom Log

25    Mr Dropulich tendered the emails particularised in that paragraph. There are three emails from Mr Singh to Mr Dropulich attaching spreadsheets addressing EBITDA for the financial year ended 30 June 2021. The last email is from Mr Dropulich to Mr Singh attaching the spreadsheet pleaded in the body of para 9. That spreadsheet records a normalised EBITDA of $12,518,749 after allowing for an item referred to as ‘EBITDA – John Holland Settlement (NET)’. As already mentioned, Mr Dropulich was Valmec’s managing director and Mr Singh was its CFO. Each was a chartered accountant.

26    Mr Dropulich submits that the pleading does not state what he is alleged to have said or done to support the conclusion that he made the representation. He submits that the formulation ‘each and together’ is rolled-up and makes multiple allegations that should be pleaded separately and it is unclear what is meant by ‘together’. Mr Dropulich also submits that the reference to para 8(b) is ambiguous and likely to cause embarrassment or delay at the trial of the proceeding. I disagree.

27    The formulation ‘each and together’ is not evasive, ambiguous or unclear. It is consistent with the admonition of brevity in r 16.02 of the Rules. It is unnecessary to plead out in a laborious and repetitive manner every permutation and combination of allegations that are straightforward such as the allegations in para 42. It is plain that what is alleged in para 42 is that Mr Dropulich made the representations or Mr Singh made the representations or both Mr Dropulich and Mr Singh made the representations. If that were not self-evident from the text of para 42, it is made abundantly clear from the context and facts pleaded in paras 4, 6, 8(b) and 9. The facts pleaded in para 9 describe how it is alleged that each of Mr Dropulich and Mr Singh separately and together made the representations. The context and emails particularised are sufficient to give rise to an inference that Mr Dropulich, as managing director, directly or indirectly instructed, approved or authorised Mr Singh, as CFO, to prepare or complete the document containing the representation and upload it into the dataroom knowing that it would be read and used by Altrad during the due diligence process. The facts pleaded describe how Mr Singh prepared and uploaded the document containing the representation into the dataroom. An inference also arises that the information conveyed by the document was the result of a collaboration between Mr Dropulich and Mr Singh. The reference to para 8(b) is plainly part of the context, along with para 4 and para 6, that supports the fact pleaded in para 42 to the effect that Mr Dropulich or Mr Singh or both made the representation through Mr Singh uploading the document into the dataroom. The respondents have fair notice of the case that has to be met.

28    Similar objections are taken to the use of the expression ‘each and together’ in para 43 and para 45 and ‘reliance upon the representations (or any one or combination of them)’ in para 44 and para 46. These should be rejected for the same reason that the various alternatives in the expression ‘each and together’ in para 42 are clear and brevity is to be preferred to prolixity.

29    Mr Dropulich and Mr Singh also object to para 48 of the statement of claim which is in the following terms.

The representations made by Mr Dropulich, Mr Zurhaar and Mr Singh pleaded in paragraphs 43 and 45 above were misleading in that those representations were false in that Valmec's EBITDA for FY21 was less than $12 million.

Particulars

Valmec's EBITDA for FY21 was no more than $$8,250,000 in circumstances where there were verifiable trade creditor liabilities at 30 Tune 2021 in the amount of at least $3,750,000 (ex GST) that were not reflected in the documents provided to Altrad and Altrad Australia prior to the Acquisition, in particular the FY21 Forecast Spreadsheet, CFO Report, the FY21 financial accounts pleaded at paragraph 20 above, the Appendix 4E Report and the Scheme Booklet.

Further particulars will be provided following the exchange of expert reports and prior to trial.

30    The objecting respondents submit that the plea that ‘EBITDA for FY21 was less than $12 million’ is conclusionary and obscures the real facts that need to be proved to establish the falsity of the representation about EBITDA. They submit that the particulars do not cure the defect and should be pleaded as material facts. They also complain that the particulars do not explain how the alleged existence of additional trade creditors has an equivalent impact on EBITDA. Mr Dropulich submits, in effect, that the alleged trade creditors should be pleaded as material facts along with when and in what circumstances the alleged liabilities were incurred or became payable. I do not accept any of these submissions.

31    Material facts are pleaded as a statement of the facts that the Court will be invited to find after hearing the evidence going to the elements of the cause of action that it is alleged entitles the applicants to the claimed relief. There may be many intermediate findings of fact that must be made in order to make relevant findings of the existence of a material fact that is an element of the cause of action. It is not usually reasonable or necessary to plead all the intermediate facts as material facts. Many, or possibly most, intermediate facts would normally form part of the particulars of the information by which the pleading party intends proving the material facts. In that sense, any material fact that depends upon intermediate findings or inferences drawn from other facts might be described as conclusionary. Put another way, to describe a material fact as conclusionary is not particularly helpful and does not make the fact pleaded objectionable in and of itself. As the applicants submit, the real issue is whether the material facts are pleaded at too great a level of generality for the opposing party to have fair notice of the case to be met or to expose the real issues that require determination in the proceeding.

32    It has long been an established rule of pleading that the question of the level of generality of the pleading must depend on the subject-matter of the pleading. As much certainty and particularity must be insisted on, both in pleading and in proof, as is reasonable, having regard to the circumstances and to the nature of the case in question. ‘To insist upon less would be to relax old and intelligible principles. To insist upon more would be the vainest pedantry’: Ratcliffe v Evans [1892] 2 QB 524 at 532-533. Except that striking the balance between principle and pedantry must now also take into account s 37M of the Federal Court Act and the modern case management techniques to which reference has been made earlier in these reasons, that ‘rule of pleading’ is as good now as it was in 1892.

33    The pleaded fact – that Valmec’s EBITDA for FY21 was less than $12 million – is a material fact. The particulars inform that EBITDA is alleged to have been no more than $8.25 million. The particulars inform that the difference between the represented EBITDA ($12 million) and the alleged EBITDA ($8.25 million) is an alleged understatement of trade creditors ($3.75 million). The pleaded material fact and particulars is sufficient to provide the respondents fair notice of the case that has to be met in circumstances in which there will be discovery, by which the applicants will have to discover the documents upon which they rely, and there will be an exchange of pre-trial expert evidence, that will deal with the alleged actual EBITDA for the financial year ended 30 June 2021. To insist upon pleading each underlying transaction alleged to comprise EBITDA or the understatement of trade creditors would be unreasonable and unnecessary pedantry. I also do not consider it necessary to require the fact of the total alleged understatement of trade creditors to be pleaded as a separate material fact so as to allow for that fact to be traversed or admitted. It is sufficient, in the circumstances of this case, for the parties to join issue at the level of the actual EBITDA of Valmec for the relevant financial year upon the footing and understanding that the applicants allege that the respondents misrepresented the true EBITDA due to a significant understatement of trade creditors.

Disposition

34    The applications to strike-out the identified paragraphs of the statement of claim must be dismissed with costs.

35    Having addressed the pleading dispute, it is appropriate to make consequential case management orders that were the subject of competing minutes of proposed orders at the case management hearing on 5 March 2025. These were the subject of oral submissions on 5 March 2025 and 2 April 2025.

36    I have taken the parties’ submissions into account and formed the view that orders should be made to progress the proceeding to the point at which pleadings have closed, discovery is completed, and the parties are in a position to brief expert witnesses. In the meantime, I intend provisionally listing the proceeding for trial in the first half of 2026. At the next case management hearing, the question of the most appropriate manner of dealing with expert, lay and documentary evidence will be addressed as will the timing of mediation and confirmation of the dates and length of trial.

Associate:

Dated:    10 April 2025