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  • Unreported Judgment

Geju Pty Ltd v Central Highlands Regional Council

 

[2016] QSC 159

 

SUPREME COURT OF QUEENSLAND

 

PARTIES:

FILE NO/S:

Trial Division

PROCEEDING:

Application

ORIGINATING COURT:

DELIVERED ON:

21 July 2016

DELIVERED AT:

Rockhampton

HEARING DATE:

18 July 2016

JUDGE:

McMeekin J

ORDERS:

  1. The Defendant is not permitted to adduce in evidence the report of Mr William Purcell dated 27 June 2016.
  2. Paragraphs 7(c)(vi)(D), 7(c)(viii) and 11A(c)(ii) of the Amended Defence filed 1 July 2016 be struck out to the extent that the paragraphs plead what a prudent solicitor would have done.
  3. Paragraphs 13(bb), 13(f)(iv) and 13(f)(v) of the Amended Defence filed 1 July 2016 be struck out.
  4. The Defendant file and serve a Further Amended Defence conforming with these reasons and orders by 4pm on 22 July 2016.
  5. The Defendant pay the Plaintiff’s costs of and incidental to this application.
  6. The parties have liberty to apply on matters arising out of these reasons on the giving of two business days’ notice to the other.

CATCHWORDS:

PROCEDURE – SUPREME COURT PROCEDURE – QUEENSLAND – PROCEDURE UNDER UNIFORM CIVIL PROCEDURE RULES AND PREDECESSORS – AMENDMENT – where the applicant applies to have certain amendments to the defence disallowed – where the applicant applies to obtain orders precluding the defendant relying on two expert reports – where there has not been compliance with the rules and practice direction for experts - whether the applicant will suffer prejudice – whether the amendments are embarrassing or have a tendency to prejudice or delay the fair trial of the proceeding

Civil Liability Act 2003 (Qld)

Uniform Civil Procedure Rules 1999 (Qld), r 171, r 379

Allstate Life Insurance Co v Australian and New Zealand Banking Group Ltd (No 6) (1996) 137 ALR 138

AON Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175

Midland Bank Trust Co Ltd v Hett, Stubbs & Kemp [1979] Ch 384

O’Brien v Gillespie & Ors (1997) 41 NSWLR 549

Permanent Trustee Australia Ltd v Boulton (1994) 33 NSWLR 735

Westpac Banking Corporation v Jamieson [2015] QCA 50

Yam Seng Pte Ltd v International Trade Corporation Ltd [2013] EWHC 111

COUNSEL:

C Heyworth-Smith QC for the applicant

A Duffy QC the respondent

SOLICITORS:

Macrossan and Amiet Solicitors for the applicant

King & Company Solicitors for the respondent

  1. McMeekin J: The plaintiff, Geju Pty Ltd, applies to have certain amendments to the Defence disallowed and to obtain orders precluding the defendant relying on two expert reports.
  1. There are proceedings pending between the parties. The matter is set for trial commencing 1 August next, that is in two weeks’ time. The proceedings concern a land transaction. The plaintiff purchased certain land in 2008. It claims that it did so in reliance on a town planning certificate issued by the local council, the defendant, Central Highlands Regional Council, which certificate Geju claims was defective. Geju’s case is that the certificate showed the relevant land as zoned “industrial” whereas it was in fact zoned “rural”. The Council says that it is not liable for various reasons but that if it fails in that defence then the solicitor who then acted for Geju is also liable, that the liability is a proportionate one under the Civil Liability Act 2003 (Qld), and that the apportionment between the co-defendants should be 90/10 against the solicitors.
  1. Geju sued the solicitors acting and those proceedings have compromised recently – on 21 June 2016.
  1. The current disputes turn to a degree on the construction put on orders made on 30 May 2016.
  1. I then ordered, over the defendant’s objection, that the matter be listed for the callover for the next sittings in Mackay commencing on 25 July, that the parties “have leave to call their expert witnesses ‘without prejudice’ to any objection to the admissibility of that evidence on grounds other than non-compliance with Chapter 11 Part 5 of the Uniform Civil Procedure Rules 1999 (Qld) (UCPR) and Practice Direction No 2 of 2005” (para 5 of the Orders), that the parties have leave to call their experts by telephone (para 6), that the defendant serve any expert report it proposed to rely on by 24 June (para 7), and file and serve any amended defence by 1 July (para 8). Finally I ordered that “any application for the appointment of a joint expert solicitor be filed and served by 4pm on 3 June 2016” (para 13 of the Orders).

Mr Purcell’s report

  1. The plaintiff objects to the defendant leading evidence from a Mr Purcell, an experienced solicitor, who has provided a report to the defendant’s side concerning the practices that Mr Purcell maintains a prudent and diligent solicitor would have adopted if confronted with the town planning certificate that the Council issued here.
  1. There are several grounds argued. One is that the contents of the report are inadmissible, it being contended that Mr Purcell does not restrict his opinion to what is arguably able to be received (see Permanent Trustee Australia Ltd v Boulton (1994) 33 NSWLR 735 at 738 per Young J) but trespasses into areas where he is effectively swearing the ultimate issue as to what amounts to negligence by a solicitor. Ms Heyworth-Smith of Queens Counsel who appeared for Geju cited Allstate Life Insurance Co v Australian and New Zealand Banking Group Ltd (No 6) (1996) 137 ALR 138; O’Brien v Gillespie & Ors (1997) 41 NSWLR 549; Midland Bank Trust Co Ltd v Hett, Stubbs & Kemp [1979] Ch 384 in support of her submission. To a degree there is force in the argument but in my view the assessment of that should be left to trial when the facts and issues are more clearly spelt out.
  1. There is however a more fundamental concern. When the matter was last before me on 30 May there was substantial discussion about the defendant’s then proposal to call evidence from Mr Purcell. I pointed out in argument then that the rules and Practice Direction relating to the receipt of expert evidence (PD No 2 of 2005) had not been complied with and expressed the view that this was a “classic” case in which a single expert should be appointed by the Court, if indeed there was a need for such evidence. In the course of my formal reasons I said this in relation to evidence from a solicitor:

“What is clear is that if the solicitors have decided that such an opinion is relevant to the issues, then they [are] require[d] by the practice direction to raise the matter with each of the parties and determine whether the appointment of a single expert would be appropriate, and indeed there would need to be good reason why an appointment of such an expert would not be appropriate.  The rules then lay down a procedure to be followed, which would include bringing before the court the names of three appropriate experts, and a decision could be made.  None of that has happened here.”[1]

  1. I later said in relation to a draft set of orders that had been advanced:

“The parties are agreed on a series of orders and I’ve been supplied with two drafts, but paragraphs 1 to 7 are agreed.  The only adjustment I would make to that is that I’m not prepared to give the defendant permission to call, as an expert witness, a named solicitor, and it may be the defendant might need to seek another valuer if Mr Brett can’t get on with the job.  So for the moment, it seems to me that paragraph 5 of the draft probably is an unwise order to make so far as the valuer is concerned, and I decline to make it in relation to the solicitor.

The first contentious order is at paragraph 8, the plaintiff suggests that the defendant be in a position to serve an amended defence by 10 June and supply the expert report it proposes to rely on by 15 June.  I gather the defendant’s position is that they need a valuation report before they can amend their defence.  The only alteration to the plaintiff’s pleading has been in relation to damages, and that amended pleading was supplied on the 6th of April.  So the defendant’s well out of time in responding to that amended defence and should have provided an expert report long ago. 

What I propose to do is to give the defendant’s until 4 pm on the 24th of June to supply or to provide any expert report that it intends to rely upon at trial to the other parties, that it have until 4 pm on the 1st of July to amend its defence as it sees fit, that the plaintiff have a week after that to provide a reply, if it sees the need, that the matter be set for trial for the sittings commencing 25 July. 

If there is to be an application for an– appointment of a single expert in relation to the conveyancing practice, then I direct that that application be filed and served by 4 pm this Friday.  I will hear that application next week at a convenient time to the parties.” (my emphasis)[2]

  1. Hence when I referred to “paragraphs 1 to 7” being “agreed” I could not possibly be taken to mean that Geju had agreed to the inclusion of an order that the Council “have leave to call [the expert solicitor] without prejudice to any objection to the admissibility of that evidence on grounds other than non-compliance with Chapter 11 Part 5 of the UCPR and Practice Direction No 2 of 2005” as appears in paragraph 5 of those orders. The debate that had preceded the reasons and the reasons themselves made plain that I was not prepared to make that order. I deleted from the proffered draft the reference to the solicitor that occurred in paragraph 5. And the whole point of the last mentioned order above - that any application for the appointment of a joint expert be made by 3 June 2016 – was to have the Council comply with the rules and practice direction if it wished to have evidence of an expert solicitor before the court. No application was made.
  1. The defendant now asserts that it understood my orders of 30 May permitted the defendant to proceed with the arranging of Mr Purcell’s evidence without any need to consult with the plaintiff’s side about the appointment of an expert and without any need to make application to the Court for the appointment of an expert as the rules and the practice direction require and as indeed my order required. Nothing said at the 30 May hearing justifies that view. Given the discussion that took place that preceded my reasons and then my reasons I cannot see how the defendant took the view that they were being given permission to ignore the practice direction and rules. My view was precisely to the contrary.
  1. The orders concerning the calling of expert witnesses that were made related, as appears from the discussion that preceded the making of the orders, to the calling of valuation evidence – the defendant having not obtained expert valuation evidence by then. The plaintiff’s stance was that it would not take objection to the lateness of the valuation evidence, effectively as the price of obtaining a trial this year. It might be said that neither side paid any heed to the expert evidence rules in relation to the obtaining of the valuers’ evidence. However the parties had proceeded by agreement to that point – a mediation had been adjourned the previous November to enable Geju to obtain a valuation report. The approach I took on 30 May was that practically speaking it was too late to do anything about that and each side would call their experts as they saw fit.
  1. I see no reason to depart from the stance I took on 30 May. The defendant had the opportunity to apply for an expert solicitor to be appointed and declined to do so. There is no satisfactory explanation proffered for the ignoring of the rules and practice direction. Unless and until the defendant complies with those rules and practice direction I will not receive Mr Purcell’s evidence. It may be that if the rule was complied with the defendant could persuade me that Mr Purcell’s evidence nonetheless should be received but that point will not be reached until a single expert is appointed and heard.

The Valuer’s evidence

  1. There are three objections taken to the valuer’s report. The first is that the provision of the report was late, not in accordance with my order of 30 May and contrary to rule 5 of the UCPR. The second is that the defendant’s conduct was “delinquent” in relation to the provision of the report. The third is that aspects of the report are inadmissible.
  1. As to the alleged inadmissibility of aspects of the report, that might well be so but I consider those matters are best left for trial. A complaint was made that the valuer has not disclosed the assumptions upon which his opinion proceeds. Mr Duffy disputed the point but undertook to provide a statement of the assumptions relied on. That adequately meets the complaint.
  1. The complaint about the conduct of the defendant is that despite the solicitors receiving the report of the valuer on 17 June and my order requiring that expert reports be provided by 24 June the report was not in fact provided until 27 June.
  1. The defendant’s solicitors sought from Geju’s solicitors the indulgence of an extra day in the provision of an expert report - singular. They did not disclose that they were already in possession of the valuer’s report. They did not disclose that they were awaiting a report from a solicitor. They did not disclose that in seeking the extension it was the solicitor, not the valuer, who needed the weekend to complete his work. Had they made full disclosure of these matters then no extension would have been agreed. The conduct of the solicitors is to be deprecated. It comes very close to sharp practise.
  1. The end result is that the valuer’s report was provided a few days after it had been ordered to be provided. Geju does not claim any prejudice arises from that delay – in fact as mentioned the solicitor for Geju was prepared to accept the delay as reasonable, not realising of course that he was being misled. In the absence of prejudice to Geju I am not prepared to accede to the orders sought.

The Amendments – para 7 and 11A

  1. The principal ground argued was that of irrevocable prejudice. The concern expressed was that the amendments were first notified when Geju had already compromised its claim against the solicitor defendant and the amendments went to the question of apportionability of liability between the Council and the solicitor defendant. Mr Duffy met this argument by expressly disclaiming any intention of relying on the amendments in relation to the apportionability question.
  1. This then raises the question of the point of the amendments. Mr Duffy submitted that their sole import was on the question of reliance on the allegedly defective certificate. The relevant paragraphs are para 7(c)(vi)(D) and (viii) and para 11A(c) of the Amended Defence. It now provides as follows, with the amendments underlined:

7(c) [The Defendant] says further, and in the alternative, that if the Plaintiff did rely on the contents of the Certificate in determining to proceed with the purchase of the Property (which is not admitted), such reliance was not reasonable in circumstances where:

(vi) a reasonable purchaser of commercial premises, or alternatively a prudent solicitor (that is, a reasonably competent solicitor acting prudently and diligently) acting on behalf of such a purchaser undertaking appropriate due diligence:

(D) would have carried out searches in relation to the Property, including town planning searches and enquiries, which would have shown the true position in relation to the zoning and permitted use of property;

7(c)(viii) a prudent solicitor acting on behalf of such a purchaser would have advised the purchaser:

(A) that limited planning certificates contained limited information and the Plaintiff ought not to obtain such a certificate; and

(B) that the Certificate was unreliable and that further enquiries were warranted;

11A The Defendant denies the allegations in paragraph 16A of the Amended Statement of Claim, because:

(c) it was not reasonable for the Defendant to expect that reliance would be placed on such a certificate:

(i) in circumstances such as those referred to in paragraphs 4(e) and 7 of this Amended defence;

(ii) in the absence of other searches and enquiries, such as those referred to in paragraph 7(c)(vi) of this Amended Defence.

  1. In my opinion the proposed amendments to para 7 are embarrassing and have a tendency to prejudice or delay the fair trial of the proceeding (see r 171 UCPR). That is so because they raise a false issue. The question of the reasonableness of Geju’s reliance is not determined on hypotheses that did not happen (that is that a hypothetical solicitor would have done certain things) but on the facts as they pertained at the time. It is one thing to assert that on the facts as they pertained a reasonable purchaser would have carried out searches. I do not know the relevant facts here but if a solicitor was acting then the essential argument will be whether Geju acted reasonably in relying on a solicitor to carry out relevant searches. But the amended case seeks to plead that Geju ought to have received certain advices from their solicitors and acted unreasonably because they did not receive those advices. That with respect makes no sense at all. A person does not act unreasonably because someone else failed to do something. If such a case is to be made out then it must be that the relevant person ought to have appreciated that the third person had failed to act appropriately and then acted unreasonably in themselves not responding to that failure appropriately. The unstated assumption behind the pleading is that a reasonable purchaser would have appreciated the inadequacies of their solicitor’s conduct. That is the real issue requiring determination. But that point is not pleaded.
  1. I see no difficulty with the amendments made to para 11A(c) once the offending passages of the amendments are deleted, save that there is no point to para 11A(c)(ii) as the searches referred to there will not be in the pleading.
  1. I strike out the amendments to paragraphs 7(c)(vi) and (viii) (to the extent that the paragraphs plead what a prudent solicitor would have done) and para 11A(c)(ii).

Amendments – para 13(bb)

  1. Para 13(bb) has been added. It reads:

(bb) [The Defendant] says that even if, contrary to the Defendant’s contentions, the matters alleged in the Amended Statement of Claim were true, and if the Plaintiff had purchased a property other than the Property, the Plaintiff would have suffered a loss similar to that claimed by the Plaintiff, due to the significant decrease in property values consequent upon the downturn in the mining industry in that area

  1. Ms Heyworth-Smith submitted that the effect of the pleading was to assert against Geju that the damages should be reduced by reason of a loss based on an unpleaded and unparticularised alternative hypothetical transaction. She pointed out that unless the defendant established “first, that the Applicant would have entered into an alternative transaction, specifying the transaction with a reasonable degree of certainty; secondly, that the alternative transaction probably would have been loss-making; thirdly, the amount of that loss,” then there can be no reduction of the award citing Yam Seng Pte Ltd v International Trade Corporation Ltd [2013] EWHC 111 per Leggatt J. That being the onus then the defendant, it was submitted, needed to plead the particulars of this alternative transaction to prevent the plaintiff being taken by surprise and to enable the plaintiff to meet the case against it.
  1. Mr Duffy disclaimed any intention of attempting to prove that the plaintiff would have entered into any particular alternative transaction. Nonetheless he said the defendant was entitled to plead as it has.
  1. It is now accepted that a defendant in a misrepresentation case is entitled to allege and prove that had the plaintiff not entered into the impugned transaction it was probable that he would have entered into another transaction and suffered loss which goes in diminution of the award: Westpac Banking Corporation v Jamieson [2015] QCA 50 at [142]-[155] per Applegarth J (McMurdo P and Morrison JA concurring). Applegarth J cited with approval the remarks of Leggatt J in Yam Seng that I have referred to above. Morrison JA made the following, pertinent remarks with which I respectfully agree: [22]

Secondly, policy and pragmatic considerations applicable to the administration of justice would, in my view, dictate that a defendant cannot invoke the legal principle outside the confines of a properly pleaded case. The evidential burden and level of proof required, as referred to by Leggatt J in Yam Seng Pte Ltd v International Trade Corporation Ltd highlight the fact that excursions into this area must be controlled in a principled way so that parties’ resources are not wasted on speculative allegations in an attempt to extract documentary proof of some alternative transaction. Nor should the court’s time be wasted on speculative pursuits. Any such contention would have to be pleaded with specificity and proven rigorously, as Yam Seng suggests.

  1. In my view the complaint made by the plaintiff is a good one. In the absence of any specificity in the pleading Geju cannot meet the case brought against it. In the absence of some pleading of the actual transaction that the Council said Geju would have entered into no comparison can be made between this transaction and the claimed alternative. The comparative qualities of the two parcels of land, the availability of the alternative land and the price at which it could be purchased as well as its probable drop in value because of the mining downturn all need to be determined. All that will require preparation and evidence. There can be no such preparation without a much more precise pleading.
  1. This case can be compared to the facts in Jamieson and Yam Seng. In the former case the claimant had been in the habit for years of reducing income tax by borrowing substantial sums and entering into agribusiness type investments. That was the substance of the transaction on which he sued. It was pleaded against him (and accepted as probable) that he would have again done so, that is pursued a tax minimisation agribusiness scheme, had he not entered into the subject transaction and that he would have suffered significant losses which could be reasonably accurately determined. In Yam Seng the contracts involved the marketing of certain merchandise associated with a football club. It was pleaded that had the subject transaction not been entered into the claimant would have entered into similar arrangements as it in fact had done. As it happens the claim failed as the prospective loss could not be determined. But the contract that would have been entered into could be identified with some particularity. In each of Jamieson and Yam Seng the alternative contract could be pleaded with specificity. The facts here are quite different. The purchase of a block of land involves the acquisition of something that is considered unique. The plea that the plaintiff would have suffered some similar loss as resulted here because the plaintiff would have bought some other unspecified land had the subject transaction not gone ahead involves mere speculation. If that is all that the defendant proposes to prove then it cannot succeed in producing any reduction in damages.
  1. I order that para 13(bb) be struck out.

Para 13(f)(iv) and (v)

  1. The paragraphs read:

13(f) [The Defendant] says further that the Plaintiff has failed to mitigate its loss in:

(iv) failing to enact the approved Material Change of Use to use the Property for industrial purposes prior to 24 August 2011; and

(v) further and alternatively, failing to make application to the Defendant to approve the use of the Property for industrial purposes;

  1. The complaint is that the pleas leave unstated a host of assumptions that must first be established to result in any mitigation of loss. It is submitted that there is no pleading of what the consequences of enacting the Material Change of Use (MCU) referred to might be or of making an application for approval for use for industrial purposes, and how and to what extent either course of action would have mitigated the plaintiff’s loss. As to para 13(f)(iv) it is said that there ought to be a plea that the MCU was still valid, that Geju could still utilise it at the relevant date, and the precise industrial uses the MCU permitted given the conditions to which it was subject. It is said that the plaintiff is prejudiced by the late introduction of these issues into the matter particularly given their vagueness and lack of particularity.
  1. Mr Duffy responded by asserting that the plea was intended to say that the whole loss would have been avoided by pursuing either course. That is the plaintiff would have been in precisely the same position had it done either of these things as it would have been in had the certificate not been misleading as alleged.
  1. It is necessary here to consider the Court’s power to prevent the introduction of new issues at a late stage of the proceedings. The decision of the High Court in AON Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 was cited as relevant. That case was decided effectively on the basis that one party sought to amend at a very late stage without proffering any explanation for the delay in seeking to make the amendment, the need for it having been apparent at least a year before. In those circumstances the Court held that it would be unjust to permit that party to introduce a new issue on the third day of the trial (after the other had settled with two other parties) and so delay the trial.
  1. Geju submits on that authority that the failure to explain the late introduction of the material is a relevant factor. An inference can be drawn that the delay was deliberate and tactical. I gave the defendant leave to file an affidavit by the solicitor having the conduct of the matter to explain what had occurred. The deponent denies any tactical reason for the delay – new counsel was briefed and advised the need for amendments which were incorporated in the amended defence. There is no reason not to accept the explanation. It appears from the affidavit that Mr Duffy was the first counsel to consider the adequacy of the pleadings, the original defence having been drafted by the solicitors acting. Mr Holyoak of counsel had been briefed on 18 May with instructions to consider the pleadings but he had not attended to the brief by 30 May. His work load prevented him meeting the timetable I laid down on 30 May. Mr Duffy was then retained.
  1. I mention these matters because it shows that the defendant is in this position by reason of its own dilatory conduct. It was once the practise to have counsel settle pleadings in virtually every matter of significance. That practise has died out. I do not know why. Solicitors generally have never claimed to have expertise in drafting pleadings. Counsel do make that claim and generally do have that expertise. If parties decline to take advantage of that expertise and then leave it until very late in the proceedings to seek expert advice on whether their pleadings cover all relevant issues then they can expect little sympathy from the Court when seeking to amend close to trial.
  1. I turn now to my powers. Rule 379(1) UCPR provides that a party may apply to the Court to disallow all or part of any amendment. Rule 379(2) provides that the court can make any order it considers appropriate. The rule applies to amendments made without leave and before the filing of the request for trial date. Here the filing of that request was dispensed with by my orders of 30 May – I assume no request was signed by the defendant – effective on 15 July. The matter is a little out of the ordinary as I had clearly indicated that the matter would be listed for trial in the sittings commencing 25 July. There may have been no request for trial date filed but effectively I had determined to move past that step on 30 May.
  1. Obviously the discretion is very wide but must be exercised in the interests of justice.
  1. The defendant argues that they were entitled to make the amendments as I had given them leave to do so on 30 May. This is nonsense. No intention to make any such amendments were flagged on 30 May. The only matter raised was that the defendant would probably need to amend once the valuation report was to hand. That is why a direction was made to supply any amended defence by 1 July – to give the defendant time to obtain, very belatedly, its valuation report. Given the closeness of the expected trial date the lengthy delay was an indulgence. Had the defendant flagged an intention to raise new issues not arising out of new valuation evidence there would have been no such indulgence extended. A draft of the amendment proposed would have been required promptly.
  1. I turn then to matters relevant to the discretion. The amendment is very late. The matter is set for trial on 1 August. The first notice of the issue was given on 1 July. Complaint along the lines now argued before me was made by the plaintiff in correspondence of 7 July. No response was made to that complaint.
  1. To adequately prepare on the issues the plaintiff will need to call evidence from those familiar with planning and development applications in the relevant Council area. There will need to be inspections of the land. Questions of cost and delay in pursuing such applications will need to be addressed. Valuation opinions on the likely impact on the land value – at the time the applications could have been successfully implemented, assuming that much – will be required to see if the defendant’s assertions are correct. Once that work is done amendments will be required to the Reply. Only then will the parties know what is contested and what is not. Given the defendant’s protestations about the difficulty in obtaining its expert opinions I would think there is no prospect of the plaintiff being ready for trial on these issues in only two weeks. I am satisfied that the amendments involve significant prejudice to the plaintiff.
  1. If it be thought that the prejudice could be met by an order for an adjournment of the trial and for costs thrown away the approach taken in AON Risk Services becomes relevant. As well the whole point of the directions given on 30 May was to have the matter ready for trial by the upcoming sittings. As discussed then the prospective delay facing the plaintiff, given the demands on circuit sittings in Mackay, could well be approaching a year. Further, as already mentioned, here there was a mediation conducted and a case against solicitors settled on the basis of issues defined by pleadings. Now the defendant wishes to move the goal posts. It would be inherently unjust to let it do so. Orders for costs thrown away would not remedy that prejudice.
  1. In my view all relevant factors are against the allowing of the amendment. I order that paras 13(f)((iv) and (v) be struck out.

Para 14(c) and (d).

  1. Paras 14(c) and (d) are as follows:

14. Further, or in the alternative, the Plaintiffs caused or contributed to their loss by reason of their own negligence under section 10 of the Law Reform Act 1995 (Qld), particulars of which are failing to take reasonable precautions, in the manner of a reasonably prudent purchaser of commercial premises, in the purchase of the Property, including:

(c) entering into a contract to purchase the Property at a price of $900,000.00, which was substantially in excess of the true value of the Property, namely $525,000.00;

(d) seeking to negotiate that terms be included in the contract for purchase of the Property to the effect that the Plaintiff could have terminated the contract if the zoning and permitted use of the Property did not permit the Plaintiff to use the Property as it intended.

  1. The complaint is that the amendments depend on valuation evidence, that evidence is fatally flawed by reason of the false assumptions on which it proceeds and hence there is no utility in allowing the amendment as there is no evidential basis for them.
  1. In my view it is premature to consider the validity of the assumptions underlying the valuer’s report. The attack made on it may well be repelled by evidence so validating the assumptions.
  1. The premise on which the trial was set down was that the plaintiff would cope with the defendant’s valuation evidence when it was to hand on the basis of the timetable laid down. So considerations of change of position and delay are not relevant here.
  1. I decline to strike out the amendments.

Summary

  1. Given the substantial success of the plaintiff on the matters argued the plaintiff should have its costs.
  1. The defendant should formalise the record with a further amended defence which conforms with these reasons and orders I am about to make.
  1. The orders are:
  1. The Defendant is not permitted to adduce in evidence the report of Mr William Purcell dated 27 June 2016.
  1. Paragraphs 7(c)(vi)(D), 7(c)(viii) and 11A(c)(ii) of the Amended Defence filed 1 July 2016 be struck out to the extent that the paragraphs plead what a prudent solicitor would have done.
  1. Paragraphs 13(bb), 13(f)(iv) and 13(f)(v) of the Amended Defence filed 1 July 2016 be struck out.
  1. The Defendant file and serve a Further Amended Defence conforming with these reasons and orders by 4pm on 22 July 2016.
  1. The Defendant pay the Plaintiff’s costs of and incidental to this application.
  1. The parties have liberty to apply on matters arising out of these reasons on the giving of two business days’ notice to the other.

Footnotes

[1] Page 3, Line 15-22

[2] Page 4, Line 25 – Page 5, Line 4

Close

Editorial Notes

  • Published Case Name:

    Geju Pty Ltd v Central Highlands Regional Council

  • Shortened Case Name:

    Geju Pty Ltd v Central Highlands Regional Council

  • MNC:

    [2016] QSC 159

  • Court:

    QSC

  • Judge(s):

    McMeekin J

  • Date:

    21 Jul 2016

Litigation History

Event Citation or File Date Notes
Primary Judgment [2016] QSC 159 21 Jul 2016 -

Appeal Status

No Status