Case: Aon Risk Services Australia Limited v Australian National University [2009] HCA 27
Outcome: followed
in Aon Risk Services Australia Limited v Australian National University [2009] HCA 27, the High Court revisited the question of late applications for amendment of pleadings, and the relevance to such applications of the powers and principles of case-management. The High Court reversed the order of the primary judge allowing the plaintiff to make substantial amendments to its claim at the start of the trial. At [92], Gummow, Hayne, Crennan, Kiefel and Bell JJ referred to the fact that case-management "is now an accepted aspect of the system of civil justice administered by courts in Australia." At [98], their Honours said with reference to the rule of Court conferring case-management powers on the Supreme Court of the Australian Capital Territory: Of course, a just resolution of proceedings remains the paramount purpose of r 21; but what is a "just resolution" is to be understood in light of the purposes and objectives stated. Speed and efficiency, in the sense of minimum delay and expense, are seen as essential to a just resolution of proceedings. This should not detract from a proper opportunity being given to the parties to plead their case, but it suggests that limits may be placed upon re-pleading, when delay and cost are taken into account. The Rule's reference to the need to minimise costs implies that an order for costs may not always provide sufficient compensation and therefore achieve a just resolution. It cannot therefore be said that a just resolution requires that a party be permitted to raise any arguable case at any point in the proceedings, on payment of costs. At [111], their Honours concluded: An application for leave to amend a pleading should not be approached on the basis that a party is entitled to raise an arguable claim, subject to payment of costs by way of compensation. There is no such entitlement. All matters relevant to the exercise of the power to permit an amendment should be weighed. The fact of substantial delay and wasted costs, the concerns of case management, will assume importance on an application for leave to amend. Statements in JL Holdings which suggest only a limited application for case management do not rest upon a principle which has been carefully worked out in a significant succession of cases. On the contrary, the statements are not consonant with this Court's earlier recognition of the effects of delay, not only upon the parties to the proceedings in question, but upon the court and other litigants. Such statements should not be applied in the future. The present case is not one concerning a late application for amendment of pleadings. In many senses, it is more serious. It is a case of repeated refusals, not merely failures, to comply with orders of the court requiring the appellants to make discovery of documents and to allow Ms Wang's solicitor to inspect their discovered documents. Mr Lee had persisted with a demand for payment as a pre-condition for providing inspection of documents, despite advice from his own solicitor that this was not a course open to him. Even in the face of deadlines specified by the federal magistrate for the performance of obligations under earlier orders, Mr Lee proposed leisurely timetables for the performance of those obligations and a further adjournment of the trial, which had already been adjourned once. The circumstances in which the appellants had ceased to be represented by their solicitor were never revealed, making it more difficult for them to rely on lack of representation as a factor justifying the adjournment of the trial. It is significant that, despite the lack of representation and Mr Lee's difficulty with English, the two affidavits of 7 and 9 April demonstrated to the federal magistrate that Mr Lee had access to someone who was sufficiently fluent in English, and had sufficient understanding of the court processes, to produce affidavits in something close to the proper form. It would have been open to the federal magistrate to reach the conclusion that Mr Lee was attempting to postpone an inevitable judgment against the appellants on Ms Wang's claim, and that the need to visit his father in China was raised as part of such an attempt. The fact that the federal magistrate was kinder to Mr Lee than he needed to be, by not making such a finding, should not lead to a successful appeal from the exercise of the federal magistrate's discretion. If the powers given by rules of court to give judgment against a defaulting party were never to be exercised, because of a supposed principle that judgment for a large sum of money should not be given without a trial, the grants of express powers by rules would be hollow. Case-management would be deprived of its only real sanction against a party who, while resisting a claim for a substantial sum of money, defaults persistently in complying with orders of a Court. The framers of rr 13.03A and 13.03B of the Federal Magistrates Court Rules cannot have intended that those rules should be subject to such a principle that would enable a party against whom a substantial monetary claim is made to defend that claim by failing persistently to take steps necessary to bring the claim on for trial. Any principle derived from Freeman is much more limited than that suggested by counsel for the appellants. Freeman is best regarded as turning on its particular circumstances, and as belonging to an era before the broad adoption of case-management principles. As the recent judgment in Aon shows, case-management principles have assumed a greater importance than they were thought to have had, even as recently as 1997, when JL Holdings was decided. It is clear from the second passage I have quoted from Aon in [36] above that the principle stated in JL Holdings should no longer be followed. If there remains a narrower principle derived from Freeman than that suggested by counsel for the appellants, such a principle could not be applicable in the present case. There is no injustice in judgment for a large sum of money against Heng V and Mr Lee, having regard to Mr Lee's apparent determination not to comply with repeated orders requiring him to produce for inspection all of the appellants' discoverable documents. Conclusion