Federal Court of Australia

Condon (liquidator) v Hope, in the matter of Mount Yenga Contracting Pty Limited (In Liquidation) (No 2) [2026] FCA 1335

ORDERS

THE COURT ORDERS THAT:

1.    The final hearing listed on 8 and 9 September 2026 is vacated.

2.    Pursuant to s 53A of the Federal Court of Australia Act 1976 (Cth), the proceedings be referred to mediation before a Registrar of the Court on 9 September 2026 at 11.30am.

3.    By 4.00pm on 6 October 2026, being 28 days from the date of these orders, the plaintiffs are to file and serve a further amended statement of claim marked up in accordance with r 16.59 of the Federal Court Rules 2011 (Cth).

4.    By 4.00pm on 3 November 2026, being 28 days after compliance with Order 3, the defendant file and serve any defence to the further amended statement of claim.

5.    By 4.00pm on 17 November 2026, being 14 days after compliance with Order 4, the defendant file and serve any further affidavit evidence on which he relies.

6.    The proceedings be listed for a case management hearing on 15 December 2026.

7.    By 4.00pm on 8 December 2026, the parties confer and email the Associate to Cheeseman J:

(a)    a joint statement identifying the issues remaining in dispute;

(b)    a list of the affidavits to be read and witnesses required for cross-examination; and

(c)    an estimate of the length of the final hearing.

8.    The plaintiffs bear their own costs of their application and any costs thrown away by the adjournment.

9.    The plaintiffs pay the defendant his legal costs that have been thrown away by reason of the filing of the further amended statement of claim, such costs to be agreed, or failing agreement, assessed.

10.    Liberty to apply on three days’ written notice.

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

REASONS FOR JUDGMENT

CHEESEMAN J:

INTRODUCTION

1    The first plaintiff, Schon Gregory Condon, is the liquidator of the second plaintiff, Mount Yenga Contracting Pty Ltd (in liquidation). I refer to them together as the plaintiffs. The plaintiffs seek relief against the defendant, Michael Andrew Hope, the sole director, shareholder and secretary of Mount Yenga arising from alleged insolvent trading by the second plaintiff. The principal amount in issue is approximately $357,246.20. The plaintiffs are represented by solicitors and counsel. Mr Hope is a litigant in person. The most recent firm of solicitors engaged by him in this proceeding ceased to act in June 2026.

2    The proceeding was listed for final hearing with an estimate of two days and was due to commence this morning. On 1 September 2026, seven days before the listed commencement of the final hearing, the plaintiffs served a further affidavit, submissions, and a proposed further amended statement of claim. They then filed an interlocutory process seeking leave to rely on the proposed pleading. That application was listed for determination at the commencement of the final hearing.

3    On 7 September 2026, a supplementary court book comprising three volumes was delivered to my Chambers which included the materials referred to above. Mr Hope was provided with the supplementary court book at the commencement of the final hearing.

4    Mr Hope sought an adjournment of the hearing on the basis that he received the plaintiffs’ new material only seven days before the hearing and had not had a reasonable opportunity to understand and answer the case now proposed. I did not require Mr Hope to file an interlocutory process to vacate the final hearing as it arose in response to the plaintiffs’ interlocutory process seeking leave to rely on the proposed pleading.

5    The amendment application and the adjournment application were closely connected. Whether the final hearing could proceed depended on the scope and practical effect of the proposed amendments and the work reasonably required of Mr Hope in response.

6    The plaintiffs rely on the affidavits of the liquidator affirmed 28 October 2024 and 1 September 2026, along with Exhibits SCG-1 and SCG-2 to those affidavits, as well as the affidavit of Rebekah Odgers, Associate at SLF Lawyers, along with the annexures to that affidavit. Mr Hope relies on his affidavit sworn on 4 September 2026.

7    For the following reasons, I granted leave for the plaintiffs to file a further amended statement of claim in substantially the form proposed and vacated the final hearing. I ordered that the parties attend a mediation before a Registrar of the Court on 9 September 2026 at 11.30am. I also made orders for the proceeding to be listed for a case management hearing on 15 December 2026 to allocate new final hearing dates should that be necessary.

APPLICABLE PRINCIPLES

8    Leave is required to file the proposed amended statement of claim because the pleadings have closed: rr 16.51 and 16.53 of the Federal Court Rules 2011 (Cth). The discretion to grant leave is broad, but must be exercised in a manner consistent with the overarching purpose stated in s 37M of the Federal Court of Australia Act 1976 (Cth) (FCA Act).

9    Section 37M of the FCA Act identifies the overarching purpose of the civil practice and procedure provisions as facilitating the just resolution of disputes according to law as quickly, inexpensively and efficiently as possible. Section 37M is relevant to the exercise of discretion to grant leave to amend pleadings. It is also relevant to the maintenance of final hearing dates which is important to the just resolution of disputes. A hearing should not be vacated merely because compliance has been imperfect or a party would prefer more time.

10    Efficiency cannot, however, displace procedural fairness. A party must have a practical and effective opportunity to understand and meet the case advanced against that party. In deciding whether late material can be accommodated, the Court considers its nature, its relationship to the existing case, the reason for its lateness, the work reasonably required in response, and whether any prejudice can be cured by directions, costs or a more confined course.

11    A litigant in person remains bound by the Rules and orders of the Court. The Court cannot give legal advice or formulate that litigant’s case. It must nevertheless ensure, so far as reasonably practicable, that the litigant understands the procedural issue and has a fair opportunity to present submissions and relevant material.

CONSIDERATION

12    The orders made on 23 June 2026 required, among other things, the plaintiffs’ opening submissions by 14 August 2026, identification of unresolved objections and witnesses for cross-examination by 20 August 2026, an agreed trial timetable and the defendant’s responsive submissions by 25 August 2026, and the plaintiffs’ reply and the parties’ lists of authorities by 1 September 2026. The orders granted liberty to apply on three days’ notice.

13    Important steps were not completed within that timetable. The plaintiffs’ objections were sent to Mr Hope on 26 August 2026. Their opening submissions, further affidavit and proposed further amended statement of claim were sent on 1 September 2026. The interlocutory process seeking leave to amend was filed on 4 September 2026.

14    The plaintiffs did not bring their non-compliance with the timetable to the Court’s attention until the Court initiated inquiries concerning the parties’ readiness for hearing. In response, the plaintiffs disclosed the default in the timetable, the outstanding steps, and the proposed amendment application.

15    The plaintiffs explain that the need for the amendments emerged when counsel, retained in August 2026 to prepare for the hearing, identified matters requiring further instructions from the liquidator. That explanation accounts for the immediate origin of the amendments but does not explain why the underlying matters were not addressed earlier in the proceeding. The amendments are nevertheless material to the accurate identification of the debts and the amount claimed. The proposed amendments do not introduce a new cause of action, but clarify and particularise the existing insolvent trading claim, including the debts relied upon, payments made by and to the Australian Taxation Office, the alleged period of insolvency and the calculation of loss.

16    I was satisfied that leave to amend should be granted on the basis that the proposed amendment is directed at tidying up the pleading to ensure that the issues are clearly defined and understood: Oswal v Apache Corporation (No 3) [2014] FCA 835 at [6] (Gilmour J), citing Pascoe v Boensch [2009] FCA 1240 at [79] (Graham J). The way in which that objective has been implemented has introduced confusion. The proposed further amended statement of claim is difficult to follow because of errors on its face. I granted leave on condition that the plaintiffs file a pleading that corrects the typographical and drafting errors and is marked up in accordance with r 16.59 of the Rules. I was satisfied that the prejudice caused by the late introduction of the amendments could be addressed by vacating the hearing, permitting a defence to be filed to the amended pleading, and allowing Mr Hope an opportunity to file and serve any further evidence on which he intends to rely.

17    Before vacating the hearing, I considered whether the dates should be preserved by determining the amendment application, identifying the operative pleading and evidence, and examining the responsive steps reasonably required. That course was preferable to vacating the hearing without testing whether a more confined solution was available.

18    There were real considerations in favour of maintaining the hearing dates. The proceeding commenced in October 2023; the dates for hearing had been fixed by orders made on 27 February 2026; substantial material had already been filed and served; and the central cause of action remained one for insolvent trading under ss 588G and 588M of the Corporations Act 2001 (Cth). Mr Hope’s existing evidence addressed the company’s solvency, taxation liabilities, and related-party financial support. Some of the amendments could be described as clarification or further particularisation. Delay in the hearing date would require additional case management and defer resolution.

19    Those considerations were outweighed by the consequences of the plaintiffs’ timing in bringing the amendment application and in serving additional material on Mr Hope in circumstances where they were aware he was not legally represented. The plaintiffs are represented. Their late material included not only overdue submissions and objections, but a proposed amended pleading and further evidence. The proposed amended pleading has errors on its face that made the process of counsel explaining the effect of the amendments more time-consuming than it should have been. That was an additional complicating factor with which Mr Hope was expected to grapple on the run, as it were. The amendments addressed the debts relied upon, interest and penalties, payments to and from the Australian Taxation Office, the proof of debt, a preference recovery, the alleged insolvency period, and the amount claimed.

20    Although the statutory foundation of the claim remained unchanged, the amendments required forensic consideration. Mr Hope needed to know the final case he was being asked to answer, file and serve a defence to the further amended statement of claim and any further evidence, consider objections to the new evidence, and prepare any cross-examination. The proposed draft pleading also had to comply with the Rules before leave could properly be granted.

21    The timing was material. Mr Hope received the new material only seven days before trial. The application for leave to amend was determined on the morning the hearing was due to commence. If leave were granted, there would be no meaningful interval in which Mr Hope could plead to the amended case or make informed decisions about evidence and cross-examination. I rejected the plaintiffs’ submissions to the effect that Mr Hope should be granted only a short adjournment and be ready to proceed tomorrow.

22    Mr Hope’s status as a litigant in person did not entitle him to an adjournment. It did, however, bear upon whether the opportunity offered to him was practical and effective to enable a fair hearing. The plaintiffs sought to alter their case after defaulting on the timetable. The consequence of proceeding immediately would have been to place the principal burden of that default upon a litigant in person responding to a claim for substantial personal liability. A relevant factor in considering the impact on Mr Hope was that whereas he had been legally represented at the time his defence to the existing pleading and evidence was prepared and filed, he no longer has the benefit of legal representation. He deposes that he cannot afford legal representation and will be faced with preparing a defence to the further amended statement of claim himself. He points to the fact that the claim against him and the effect of the amendments are complicated for him to understand without legal assistance.

23    The plaintiffs’ submission that Mr Hope would be unlikely to require further evidence was relevant but speculative. Mr Hope must be given a reasonable opportunity to understand and respond to the changed case. I was not satisfied that the final hearing could proceed fairly and efficiently on the basis of the amended pleading within the existing dates. The prejudice to Mr Hope as a litigant in person could not be cured by a costs order or a short adjournment within the allocated hearing time. He required sufficient time to plead to the amended case and to identify any further evidence on which he intended to rely. I therefore vacated the final hearing.

NEXT STEPS

24    Vacating the final hearing did not require the allocated dates to be lost entirely. The parties previously mediated on 18 June 2025 without resolving the proceeding. Since then, the plaintiffs’ case has been further particularised, the evidentiary material has developed and substantial trial preparation has occurred.

25    I considered that the reserved dates could be used productively for a further mediation. That conclusion did not reflect any view about the merits or an assumption that the proceeding will settle. Pursuant to s 53A of the FCA Act, I referred the proceeding to mediation before a Registrar of the Court, with the mediation to take place on 9 September 2026.

26    The orders I made also provided 28 days for the plaintiffs to file and serve a further amended statement of claim, a further 28 days for Mr Hope to file and serve any defence to the amended statement of claim, and a further 14 days for him to file and serve any additional affidavit evidence. Those steps will be completed by 17 November 2026, leaving time for the parties to confer before the next case management hearing on 15 December 2026.

27    At that case management hearing, the Court will identify the remaining issues, address any outstanding interlocutory steps, settle a realistic trial timetable and estimate, and allocate new final hearing dates. The Court will not allocate a date for final hearing before it is satisfied that the pleadings are closed and all the evidence has been filed and served.

COSTS

28    The amendment application was necessitated by the plaintiffs’ late attempt to alter their pleading and it is appropriate that they bear their own costs on that application. Although Mr Hope is a litigant in person and did not identify any recoverable legal costs on the hearing of the amendment application itself, he was represented at the time his earlier defence and evidence were filed. To the extent that he has incurred legal costs that are thrown away as a result of the amendment application, he is entitled to an order that the plaintiffs pay those costs. At the time of finalising these reasons, I realised that I had omitted to expressly include in the costs order in favour of Mr Hope that such costs be agreed, or failing agreement, assessed. That slip has been corrected and is reflected in Order 9.

29    The adjournment application arose squarely from the amendment application. I did not make any separate costs orders in relation to the adjournment application. The consequence is that the plaintiffs bear their own costs in relation to any costs thrown away by the adjournment.

CONCLUSION

30    For these reasons, I made orders as I have indicated. The hearing was vacated, the parties were ordered to mediate, and the proceeding was listed for case management on 15 December 2026 to ascertain readiness for hearing and to allocate a hearing date if necessary. These conclusions do not express any view about the merits of the proceeding.

Associate:

Dated:    8 September 2026