Lesso Building Material Trading (Sydney) Pty Ltd v PDM Stone Pty Ltd [2019] NSWSC 1160

Supreme Court New South Wales

Medium Neutral Citation: Lesso Building Material Trading (Sydney) Pty Ltd v PDM Stone Pty Ltd [2019] NSWSC 1160 Hearing dates: 4 September 2019 Date of orders: 06 September 2019 Decision date: 06 September 2019 Jurisdiction: Common Law Before: Harrison J Decision: (1) Strike out the defence of the second defendant filed on 28 March 2019. (2) Grant leave to the second defendant, if so advised, to file an amended defence within 21 days of the date of these reasons for judgment. (3) Order the second defendant to pay the plaintiff's costs of and incidental to its notice of motion filed on 21 August 2019. Catchwords: PRACTICE AND PROCEDURE – whether defence should be struck out – defence struck out Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW), rr 12.7(2), 14.28, 15.1(1) Cases Cited: Lesso Building Material Trading (Sydney) Pty Ltd v PSM Stone Pty Ltd [2019] NSWSC 1008 Category: Procedural and other rulings Parties: Lesso Building Material Trading (Sydney) Pty Ltd (Plaintiff) PDM Stone Pty Ltd (Defendant) Representation: Solicitors: Colin Biggers & Paisley (Plaintiff) File Number(s): 2019/54162 Publication restriction: Nil

Judgment 1. HIS HONOUR: By notice of motion filed on 21 August 2019, the plaintiff seeks orders, among others, pursuant to UCPR 12.7(2) that the second defendant's defence be struck out for want of due despatch or alternatively pursuant to UCPR 14.28 upon the basis that it discloses no reasonable defence, has a tendency to cause prejudice, embarrassment or delay in the proceedings or is otherwise an abuse of process. 2. By its statement of claim, the plaintiff sues the second defendant as the guarantor of all amounts owing to the plaintiff by the first defendant. Paragraph 5 of the statement of claim is as follows: Guarantee and indemnity 5 On or about 23 November 2016, Lesso and Mr Baygan entered into a guarantee and indemnity pursuant to which Mr Baygan guaranteed the payment of all amounts owing to Lesso by PDM [Stone Pty Ltd], including under the Credit Agreement (Guarantee and Indemnity). Particulars The Guarantee is in writing, forms part of the Credit Account Form and has been signed by Mr Baygan. 1. The second defendant by his defence filed on 28 March 2019 has admitted that he executed documents that in terms required him to guarantee the obligations of the first defendant but he has otherwise denied that he is indebted to the plaintiff. The defence gives little indication of the basis for the denials with the exception of paragraphs 4, 5 and 38, which are in the following terms: 4. The second defendant admits that at an unknown time an undated agreement was executed on behalf of the first defendant however denies the balance of the paragraph. 5. The second defendant admits that at an unknown time he executed an agreement purporting to be a credit account however denies the balance of the paragraph. The first defendant and the second defendant rely on a unilateral termination of credit facilities and/or a unilateral variation of credit facilities which of itself renders the guarantee and indemnity given by the second defendant as void. 38. The first defendant and the second defendant otherwise rely in full on the statement of cross claim as to an offsetting liability owed by, inter alia, the plaintiff to the first defendant. 1. The cross claim was summarily dismissed on 5 August 2019: see Lesso Building Material Trading (Sydney) Pty Ltd v PSM Stone Pty Ltd [2019] NSWSC 1008. 2. UCPR 15.1(1) provides as follows: "15.1 Pleadings must give all necessary particulars (1) Subject to this Part, a pleading must give such particulars of any claim, defence or other matter pleaded by the party as are necessary to enable the opposite party to identify the case that the pleading requires him or her to meet." 1. The defence of the second defendant consists of either bare denials that are unparticularised and unexplained or assertions of some unilateral variation or termination of credit facilities, whatever those references might mean. It is not clear from the terms of the second defendant's defence that they have any meaning at all. 2. The plaintiff has quite properly conceded that the Court might in ordinary circumstances be disinclined to strike out a defence for want of particulars if the deficiency could possibly be corrected by an appropriately framed request from the plaintiff that they be supplied. However, in the particular circumstances of this case, the defence is entirely deficient and liable to be struck out forthwith. If the second defendant wished to assert that his prima facie liability arising from his execution of the guarantee had in some fashion been overtaken by events, including an agreement to vary the terms of the guarantee, or some other condition or event that rendered the guarantee unenforceable or void, as he generally asserts, it should have been made plain in the terms of the defence. 3. The defence in its present form discloses no reasonable defence beyond a plea of the general issue. It is embarrassing and clearly has a tendency to cause delay. It should be struck out. 4. I make the following orders: 1. Strike out the defence of the second defendant filed on 28 March 2019. 2. Grant leave to the second defendant, if so advised, to file an amended defence within 21 days of the date of these reasons for judgment. 3. Order the second defendant to pay the plaintiff's costs of and incidental to its notice of motion filed on 21 August 2019.

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