Nectaria Nominees Pty Limited; Debra Nominees Pty Limited and Hawkesbury Nominees Pty Limited v Commonwealth of Australia [1992] ACTSC 128; (1992) 15 Atpr 41-208; (1992) 111 FLR 459 (21 December 1992)

SUPREME COURT OF THE ACT

NECTARIA NOMINEES PTY LIMITED; DEBRA NOMINEES PTY LIMITED and HAWKESBURY
NOMINEES PTY LIMITED v. COMMONWEALTH OF AUSTRALIA
No. SC 815 of 1990
Number of pages - 7
Practice and procedure
[1992] ACTSC 128; (1992) 15 ATPR 41-208
(1992) 111 FLR 459

COURT

IN THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Higgins J.(1)

CATCHWORDS

Practice and Procedure - Amendment of statement of claim - Whether proposed amendment constitutes a new cause of action which would otherwise be statute-barred - Rule in Weldon v Neal.

Trade Practices Act 1974 (Cth), ss.52, 53A, 82, 86

Rules of the Supreme Court, O.20 r.5(5)

Rules of the Supreme Court of the ACT, O.32, r.1

Weldon v Neal (1887) 19 QBD 394

Phillip and Anton Homes Pty Ltd v Commonwealth (1988) ATPR 49,040; (1988) ASC 57,828

Chatsworth Investments Ltd v Cussins (Contractors) Ltd [1972] UKHL 7; (1969) 1 WLR 1

Brickfield Properties Ltd v Newton (1971) 1 WLR 862

Rodriguez v R J Parker (Male) (1967) 1 QB 116

Mitchell v Harris Engineering Co Ltd (1967) 2 QB 703

State of Western Australia v Wardley Australia (1991) 30 FCR 245

Cockerill v Westpac Banking Corp (1991) 32 FCR 36

HEARING

CANBERRA, 2 and 3 December 1992
21:12:1992

Counsel for the Plaintiffs: Mr Steele

Instructing solicitors: Messrs Mallesons Stephen Jaques

Counsel for the Defendant: Mr Forest

Instructing solicitors: ACT Government Solicitor

ORDER

THE COURT ORDERS THAT:
1. Leave be granted to amend the Statement of Claim herein.

DECISION

HIGGINS J. This is an application by the plaintiffs to amend their statement of claim.

2. Three amendments were proposed. Of those, the first, to paragraph 7, is not opposed. On 3 December 1992 I gave leave to the plaintiffs to effect that amendment. The third, to add a paragraph 10A, was not opposed in substance. I granted leave to the plaintiffs to effect that amendment provided that paragraph 10A is reformulated.

3. The second amendment proposed, to paragraph 10, was strongly opposed. It seeks to insert further words as follows,
"In breach of s.52 and s.53A Trade Practices Act 1975 (sic) the

said representations were misleading or deceptive or likely to
mislead or deceive and were false and misleading."

4. The plaintiffs contend that this is not a substantive amendment. It merely alerts the defendant to the proposition that the material facts already asserted in paragraph 10 will support a claim pursuant to s.52 of the Trade Practices Act 1974 (Cth) ("TPA") as well as s.53A TPA. The defendant objects that the effect of the proposed amendment is to add a further cause of action which, if it were now to be sued upon, would be statute-barred. It submits that the "rule in Weldon v Neal" ((1887) 19 QBD 394) requires refusal of leave to amend.

5. The essence of a cause of action created by s.82 TPA is the suffering of damage. The damage complained of was sustained more than three years before the present amendment was proposed.

6. It is unnecessary to set out the facts alleged by the plaintiffs in detail. It purchased a Crown Lease ("the lease") of a block of land known as Block 23 Section 55 Belconnen, Australian Capital Territory ("the land") on 2 May 1988 for $2m. The sale was completed on 28 June 1988.

7. It is alleged that the documentation provided by the defendant before the lease was purchased effectively represented that there was no "fill" (that is, loose sub-surface materials) on the land. There was, in fact, extensive fill present on the land. That fill, in fact, caused considerable increase in the construction costs which otherwise would have been expected. It is further alleged that the National Capital Development Commission ("NCDC") (since abolished and its rights and liabilities assumed by the defendant) was aware of the "fill" on the land. The NCDC failed to convey that information to the relevant officers of the defendant. In any event, it is alleged, the NCDC was, for all relevant purposes, the agent of the defendant.

8. It is conceded that the additional works the plaintiffs had to carry out were completed by 8 July 1989. The cost of those works is the damage of which the plaintiffs complain.

9. If the misrepresentations alleged are characterised as "concerning ... the characteristics of the land ..." then s.53A will provide a basis for the remedy prescribed by s.82 TPA (see, for example, Phillip and Anton Homes Pty Ltd v Commonwealth (1988) ATPR 49,040; (1988) ASC 57,828). However, the defendant has indicated that it will rely on a ground of defence that if a misrepresentation was made, which it does not concede, it was a misrepresentation as to its state of knowledge as to the presence of fill on the land and not as to the characteristics of the land itself.

10. It is to meet that proposed contention that the plaintiffs now seek to amend paragraph 10. It does not wish to be precluded from arguing that, even if the misrepresentation is confined to the state of knowledge of the defendant (by its agent, the NCDC), it would be, at least, conduct that is, in trade or commerce, misleading or deceptive, or likely to mislead or deceive, contrary to s.52 TPA.

11. It may well be that the defendant's contention creates a distinction without a difference. However, for the purpose of considering the proposed amendment I will assume that the defendant's contention would be seriously arguable.

12. I note that the Rules of Court were amended in England in 1962 to enable amendments to add a "new" cause of action after the expiration of the relevant limitation period (see Rules of the Supreme Court O.20 r.5(5)). That Rule provides that such amendments may be allowed only where the proposed "new" cause of action arises out of the same, or substantially the same, set of facts as had already been alleged (see, for example, Chatsworth Investments Ltd v Cussins (Contractors) Ltd [1972] UKHL 7; (1969) 1 WLR 1; Brickfield Properties Ltd v Newton (1971) 1 WLR 862). The amendment proposed in this case would, undoubtedly, be allowable under that Rule. The amendment seeks to add no new fact but merely to call in aid the more general provisions of s.52 TPA in addition to the provisions of s.53A TPA. The Rule was unsuccessfully attacked as ultra vires. It was objected that it altered substantive rights, not merely practice and procedure. That view was firmly rejected (see Rodriguez v R J Parker (Male) (1967) 1 QB 116; Mitchell v Harris Engineering Co Ltd (1967) 2 QB 703).

13. The so-called "rule in Weldon v Neal" was considered by the Full Court of the Federal Court in State of Western Australia v Wardley Australia (1991) 30 FCR 245. Spender, Gummow and Lee JJ. pointed out that, whatever that "rule" prohibits or permits, the rule-making power of the court does not extend to authorise the introduction of a new cause of action when Parliament has laid down an absolute time bar against the bringing of such an action after its expiry. Their Honours adopted the view, however, that a "new" cause of action is not introduced if the same or substantially the same set of facts are relied on. Merely adding reference to a different rule of law or legislative provision is not to plead a "new" cause of action.

14. The defendant's contention in this case is that having expressly invoked s.53A TPA the plaintiffs have confined their cause of action, through s.86 TPA, to that particular provision. To now invoke the more general s.52 TPA is, to the extent it covers representations outside s.53A, to introduce a "new" cause of action within the meaning of the rule in Weldon v Neal.

15. I do not accept that contention.

16. It seems to me to be inconsistent with Wardley's case, (see p 267 in particular).

17. The Full Court in Wardley's case focussed on the factual basis for the claims to relief rather than the legislative provision or rule of law asserted to be invoked thereby. This, it seems to me, significantly qualifies the limitations previously considered to flow from Weldon v Neal. It follows also that the term "new cause of action" in the English O.20 r.5(5) is to be regarded as similarly qualified. This was recognised by Pincus J in Cockerill v Westpac Banking Corp (1991) 32 FCR 36. Referring to Wardley, his Honour said,

(38) "But for that authority, one might have experienced some
difficulty in accepting the view that the terms of s 77(i) of the
Constitution (Cth) or those of s 86(1) of the Trade Practices Act
were, in so far as the former uses the word "matters" and the
latter the word "matter", intended to say anything about time
limitations. As to s 86(1), I would, were the matter res
integra, have had difficulty in accepting that the presence of s
86(1) was truly intended to qualify the operation of s 82(2);
the latter provision requires an action for damages in reliance
on, for example, s 52 of the Act to be commenced within three
years after the date on which the cause of action accrued. In my
opinion, however, the proper course is to follow the view
expressed by the Full Court, from which it would seem to follow
that not only the rule in Weldon v Neal (supra), but also the
cognate rule relating to joinder of parties, is inapplicable in a
case such as this. That is, once it is accepted that limitation
provisions are complied with by the timely institution of a suit
relating to an identifiable matter, it would seem to follow that
elaborations of the matter by the making of additional claims, or
claims by or against additional parties, within its scope, are
unaffected by time limitation provisions."

18. It seems to me that, effectively, Wardley has declared that O.32 r.1 of the Rules of this Court embrace, with the qualification mentioned as to the meaning of the term "new cause of action", the substantive change effected by O.20 Rule 5(5) of the English Rules. The qualification is that if the "same facts or substantially the same facts" are relied on, the pleading will not be regarded as raising a "new" cause of action so far as the rule in Weldon v Neal is concerned.

19. It follows that, in conformity with Wardley's case, the amendment sought to paragraph 10 is permissible. There is no discernible prejudice to the defendant in now permitting that amendment. I grant leave to make it.

20. I will hear the parties as to further directions and costs.