Franks v Equitiloan Securities Pty Limited [2007] NSWSC 706

Franks v Equitiloan Securities Pty Limited [2007] NSWSC 706

Although the proposed amended cross-claim against Mr Franks was sufficiently arguable in principle, it would expose him for the first time to substantial personal liability and he had an arguable contention that an agreement or estoppel arising from prior negotiations and consent orders precluded that claim. Because that issue required time to investigate and might involve evidence from counsel or solicitors, the application for leave to amend the Cross-Claim and the trial should be adjourned. As both parties bore some responsibility for the late crystallisation of the issue, costs thrown away by the adjournment were reserved until the application for leave to amend was determined.

Jurisdiction
Australia
Judgment Date
11 April 2007
Procedural Posture
Equity Division Commercial Proceedings Involving Restitution Claims and a Cross Claim for Profit Share; Procedural Applications Concerning Amendment, Adjournment and Costs / Trial Commenced; Ex Tempore Ruling Adjourning the Hearing and Reserving Costs Pending Determination of Application for Leave to Amend
Outcome
Hearing adjourned; costs reserved to the hearing of the application for leave to amend; defendants granted leave to amend their Defence.
Legal Topics
['adjournment' 'leave to Amend Pleadings' 'cross Claim Against Assignee' 'deed of Company Arrangement' 'proof of Debt' 'costs Reserved']
['civil Procedure' 'equity' 'corporations' 'restitution'] ['adjournment' 'leave to Amend Pleadings' 'cross Claim Against Assignee' 'deed of Company Arrangement' 'proof of Debt' 'costs Reserved']

Case Brief

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Procedural Posture

Equity Division Commercial Proceedings Involving Restitution Claims and a Cross Claim for Profit Share; Procedural Applications Concerning Amendment, Adjournment and Costs / Trial Commenced; Ex Tempore Ruling Adjourning the Hearing and Reserving Costs Pending Determination of Application for Leave to Amend

Legal Issues

  1. 1 ['Whether the defendants should have leave to amend their Defence by filing the Proposed Second Amended Defence.' "Whether the cross-claimants' application for leave to amend the Cross-Claim by substituting Mr Franks personally for Windy Dropdown as Cross-Defendant should proceed immediately or be adjourned." 'Whether the proposed cross-claim against Mr Franks as assignee was sufficiently arguable to justify leave to amend, subject to discretionary considerations.' 'Whether Mr Franks required time to investigate and adduce evidence of an alleged agreement or estoppel precluding Equitiloan from asserting personal liability against him.' 'Who should bear the costs occasioned by the adjournment of the trial.']

Ratio Decidendi

Although the proposed amended cross-claim against Mr Franks was sufficiently arguable in principle, it would expose him for the first time to substantial personal liability and he had an arguable contention that an agreement or estoppel arising from prior negotiations and consent orders precluded that claim. Because that issue required time to investigate and might involve evidence from counsel or solicitors, the application for leave to amend the Cross-Claim and the trial should be adjourned. As both parties bore some responsibility for the late crystallisation of the issue, costs thrown away by the adjournment were reserved until the application for leave to amend was determined.

Court Disposition

Hearing adjourned; costs reserved to the hearing of the application for leave to amend; defendants granted leave to amend their Defence.

Orders

  • ['Leave granted to the Defendant to amend its Defence by filing the document marked Second Further Amended Defence, initialled by the judge and dated 11 April 2007.' 'The hearing of the application for leave to amend the Cross-Claim was adjourned.' 'The trial was adjourned.' 'Costs of and incidental to and thrown...