IL FORNO LTD v KLEINE [2020] NZHC 1732

IL FORNO LTD v KLEINE [2020] NZHC 1732 [16 July 2020]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2016-404-621[2020] NZHC 1732BETWEEN IL FORNO LIMITEDPlaintiffAND DOUGLAS JAMES KLEINEFirst defendantAND FLOW CONTROL LIMITEDSecond defendantAND ANDREW MICHAEL KLEINECounterclaim defendantHearing: 16 July 2020Appearances: MJW Lenihan for the plaintiff and counterclaim defendantJ G Ussher for the defendant and counterclaim plaintiffDate of judgment: 16 July 2020JUDGMENT OF JAGOSE JThis judgment was delivered by me on 16 July 2020 at 4.30pm.Pursuant to Rule 11.5 of the High Court RulesRegistrar/Deputy RegistrarCounsel:MJW Lenihan Barrister, AucklandJ G Ussher Barrister, Auckland[1] At the close of the plaintiff's case, Il Forno sought leave to amend itscounterclaim defence.[2] The sought amendment was in response to the defendants' counterclaim inquantum meruit, in relation to which they plead "Flow Control [provided], andIl Forno freely accepted provision of services including" some 25 particularisedservices (a) to (y). In response, Il Forno admitted the defendants "provided someservices" including those particularised (a) and (b) by the defendants, and deniedothers including (k), (l), and (m).[3] Il Forno then additionally asserted particular of the services "were notrequested by the plaintiff". Il Forno now seeks to add (a) and (b) to that list, and omit(k), (l), and (m) from it.Discussion[4] For good reason of focused trial preparation, amendment is prohibited after theclose of pleadings without leave.1 Mr Lenihan did not seek to rely on HCR 7.7(2)(b)'sentitlement to amend after close of pleadings as "merely bring[ing] up to date theinformation before the court". Thus I must be alive to anything in the soughtamendment that changes the complexion of the case from that the defendants mustmeet.[5] To obtain leave, Il Forno needs to "surmount the three formidable hurdles ofshowing that the amendment is in the interests of justice and will not significantlyprejudice defendants or cause significant delay".2 On the first, Mr Lenihan the interestsof justice favour having "the pleading align with the evidence", and there is no1 High Court Rules 2016 ("HCR"), r 7.7(1).2 Elders Pastoral Ltd v Marr (1987) 2 PRNZ 383 (CA) at 385. The explanation in McGechan onProcedure (online looseleaf ed, Thomson Reuters) at [HR7.7.01] "[t]he test for an amendment topleadings after the close of pleadings date is whether it is necessary to determine the realcontroversy between the parties and does not result in injustice to other parties or cause significantdelay" is not consistent with the Court of Appeal's judgment, which only allows "the Judge herewas entitled to treat the amendments as more in the category of those clarifying issues in disputethan in the category of those introducing distinct matters for the first time" (at 385). The "realcontroversy between the parties" the High Court Rules' threshold for the court's (and not a party's)amendment to pleadings: HCR, r 1.9.prejudice or delay. Although the defendants oppose on grounds of prejudice,Mr Ussher could not identify any prejudice from the sought alignment.[6] The precise specification of services Il Forno says it did not request of thedefendants lacks material substance in response to the assertion Flow Control providedand Il Forno "freely accepted" the particularised services, which Il Forno admits inpart and otherwise denies. Il Forno admits the defendants provided (a) and (b), anddenies they provided (k), (l), and (m), whether or not at its request. The parties'respective cases are unchanged. From that perspective the amendment has no impact,and may have been open to being made without leave as 'updating'.Result[7] I allow the amendment as being in the interests of justice, without prejudice ordelay.Costs[8] In my preliminary view, Il Forno – although the successful party on theapplication – was seeking an indulgence, and therefore should not be entitled to itscosts on the application. Any different view may be essayed on costs in the proceeding.—Jagose J