Joe Berno v Green's Steel Construction Pty Ltd [1991] NTSC 4 | Case summary

The application is dismissed.
Defendant to pay the costs of the application both here and before the Master.

COURT IN THE SUPREME COURT OF THE NORTHERN TERRITORY OF AUSTRALIA Asche C.J.(1) CWDS Practice and Procedure - Application to amend name of party to proceedings - R.36.01 Supreme Court Rules - "pending proceeding" as defined R.1.01 - rule in Weldon v Neal - Statute of Limitations Practice and Procedure - Rule in Weldon v Neal - distinction between "mere misnomer" and "substitution or addition" of a different party - exception to rule in Weldon v Neal - genuine mistake in nomenclature - test to be applied Estoppol - Estoppel by conduct - Verwayen's case - degree of detriment to be established by party relying on estoppel - "a position of significant disadvantage" Waiver - As distinct from estoppel - Verwayen's case - change in relationship of parties - promises made within the adjudicative process - restrictive test Cases followed: The Commonwealth v Verwayen (1990) 64 ALJR 540 Cases applied: Davies v Elsby Brothers Ltd (1960) 3 All ER 672 HM Attorney-General for England v Sorati [1969] VicRp 11; (1969) VR 88 Metropolitan Oils Pty Ltd v Fortron Industrial Lubricants Pty Ltd (1986) 11 FCR 335 Rainbow Spray Irrigaton Pty Ltd v Hoette (1963) 80 WN (NSW) 142 Weldon v Neal (1887) 19 QBD 394 Cases referred to: Bradshaw v Hair Transplant Pty Ltd (1986) 13 FCR 1 Clarapede and Co v Commercial Union Association (1883) 32 WR 262 J. Robertson and Co Ltd (in Liquidation) v Ferguson Transformers Pty Ltd (1970) 44 ALJR 441 Kerrison v Martin and Heyward [1975] VicRp 40; (1975) VR 401 Lubovsky v Snelling (1944) 1 KB 44 Mabro v Eagle Star and British Dominions Insurance Co Ltd (1932) 1 KB 485 Vakauta v Kelly [1989] HCA 44; (1989) 167 CLR 568 Whittam v W.J. Daniel and Co Ltd (1961) 3 All ER 796 (1962) 1 QB 271 Wright v John Bagnall and Sons Ltd (1900) 2 QB 240 HRNG DARWIN #DATE 1:2:1991 Counsel for the Plaintiff: D. Trigg Solicitors for the Plaintiff: Cridlands Counsel for the Defendant: S. Southwood Solicitors for the Defendant: Ward Keller ORDER The orders will be:

The application is dismissed.
Defendant to pay the costs of the application both here and before the Master. JUDGE1 On 27 March 1985, a Writ with Statement of Claim annexed was issued in this court in the name of "Joe Berno" as plaintiff. The Statement of Claim alleges that on or about 20 November 1984 the defendant, a company duly incorporated in the Northern Territory, agreed to carry certain goods of the plaintiff from Gun Powder in the State of Queensland to Darwin in the Northern Territory for delivery to the plaintiff; that the defendant received the goods on or about 30 November 1984; that the trailer in which the goods were then transported overturned on the journey and the goods were damaged; that this was because of the negligence of the defendant; and the plaintiff sought damages for the replacement and repair of the goods.
The defendant entered an appearance on 16 April 1985 and a Defence was delivered on 11 March 1986. The defence alleged that the contract was for the carriage of specific goods but the plaintiff unilaterally varied the terms of the original contract by delivering to the defendant for carriage to Darwin goods of a different description and weight; that it was a specific term of the original contract that the plaintiff would bear the risk of loss in the transport of the goods and make his own arrangement for insurance to cover the risk. The defendant denied any liability under the original agreement and claimed that the damage was caused by the plaintiff's own act of negligently supervising the loading of the defendant's vehicle. The defendant counterclaimed for damages to the trailer and consequential damages to the defendant's business.
On 20 July 1986, a Reply and Defence to Counterclaim was filed denying the allegations in the Defence and alleging, if there was any variation of the agreement (which was denied), the defendant ratified any such variation. Discovery was given by the defendant on 15 August 1986. On all the documents to that date (15 August 1986) the plaintiff was described as "Joe Berno".
The case then seems to have "gone to sleep". Nothing seems to have been done to move it forward for the next 2 years. I am told that the solicitor in charge of the case in the firm of solicitors acting for the plaintiff left that firm, that the firm then amalgamated with another firm and it appears that somehow the matter was overlooked. This was unfortunate in any event; but particularly because the effect of the Statute of Limitations (the N.T. Limitation Act 1981) must now be considered in any application seeking amendment; and this is such an application.

Revival occurred on 13 February 1989 when a list of discoverable documents was filed on the plaintiff's behalf. The heading remained the same and this document commenced with the words "I, Joe Berno, the abovenamed say as follows ..." (emphasis added). The expression "the abovenamed" can only refer to the heading "Joe Berno Plaintiff". 6. Some time in about October 1989 it appears that the solicitor now acting for the plaintiff discovered or was told that the plaintiff in fact should have been "Berno Brothers Pty Ltd". From the instruction he then received it seems that the allegation was that the contract made on or about 20 November 1984 was made between a company "Berno Brothers Pty Ltd" and the defendant. Some support for this comes from a document in the defendant's possession which came into existence on or about 20 November 1984, that is at the time Mr Berno had a conversation with Mr Green, a director of the defendant, relating to the carriage of goods. The document reads, so far as relevant: "This is to certify that Berno Brothers and Green's Steel Constructions have an agreement to transport for Berno Brothers the undermentioned equipment from Gun Powder to Darwin at the cost of the agreed price of ... $4000 to be paid for C.O.D. 2 x Payloaders 1 x Forklift 5 x Drums (Spare Parts) 1 x 4 tonne Weighbridge 2 x Rolls Wire Cable 3 x Switchboards Approximate Weight ...... 47 Tonne Signed J Berno Witnesses (sic) by M. I. Wright." 7. I should add, that the defendant made discovery of this document as early as 15 August 1986. Either it was not examined by the plaintiff's solicitor for some three years or its significance was not noted until about October 1989. 8. The solicitor now acting for the plaintiff took steps to have the necessary amendment made to the name of the plaintiff. He communicated by telephone and then in writing to the defendant's solicitor. By letter of 11 October 1989, he advised that it was intended to make the amendment. He delivered interrogatories to the defendant's solicitor on or about 28 October 1989 in the heading of which the plaintiff was described as "Berno Brothers Pty Ltd". On 28 February 1990 he received the answers from the defendant in which that heading was adopted. On 1 May 1990 he received a Certificate of Readiness from the defendant's solicitor in which the same heading appeared. On 2 May 1990 he telephoned the defendant's solicitor and told him that an application would be made to amend the plaintiff's name. The defendant's solicitor said that the defendant would consent to this. The defendant's solicitor reaffirmed the defendant's consent in two further telephone conversations. Acting on this assurance the plaintiff's solicitor filed an interlocutory summons on 10 September 1990 seeking that the name of the plaintiff be amended to "Berno Brothers Pty Ltd". He sent a letter to the defendant's solicitor confirming that, because the defendant's solicitor had agreed to consent to the amendment, no affidavit in support of the Summons would be filed. The defendant's solicitor advised the plaintiff's solicitor on the day before the Summons was listed before the Master that either he or someone from his office could attend on the following day and consent to the application. However, on the morning of 13 September 1990 when the application was listed before the Master, the defendant's solicitor telephoned the plaintiff's solicitor and advised that he now could not consent to the application. 9. As a result, the application before the Master was adjourned. 10. I accept the recital of these events as given by the plaintiff's solicitor in an affidavit sworn by him on 10 October 1990. The defendant's solicitor has had ample opportunity to deny them and has not done so. 11. By the time the matter came before me, as a defended matter, further affidavits had been filed which made confusion worse confounded. Firstly, it now appears that there never was a "Joe Berno" in these proceedings. The person who negotiated the agreement now deposes that his name is "Ermenegildo Berno", though he is known as "Jack" Berno. He says further, that he is the managing director of Berno Brothers Pty Ltd which has always operated under that name and not in the business name of Berno Brothers. He says he is not fluent in the English language but was the one who dealt with the defendant at the time of the agreement, and he says that he believes that it was known to the defendant that it was dealing with Berno Brothers Pty Ltd. He relies upon the written agreement I have already set out. 12. Secondly, Mr Green, a director of the defendant, swears positively that he was the person who dealt with Mr Berno, that he dealt with him personally and was never made aware that Mr Berno acted for Berno Brothers Pty Ltd either as agent or director. Furthermore, he says that he never told his secretary to draw the document up as between the defendant and "Berno Brothers" and does not know why that was done. 13. Thirdly, although he does not deny the matters deposed to in the affidavit of the plaintiff's solicitor, the defendant's solicitor says that, so far as filing answers to interrogatories with the amended heading, he did not give his secretary instructions to do this and that was a mistake. 14. It is tempting to be a little cynical about the use of secretarial scapegoats; but that is a comment which impinges on the issues themselves and may or may not have relevance in the ultimate determination of the action. However, in fairness to the defendant, it is not an unlikely scenario that Mr Green, having negotiated directly with Mr Berno, left the details to be drawn up by his secretary, and Mr Berno in Mr Green's absence told the secretary to use the expression "Berno Brothers". However it would be quite wrong for me to come to any conclusions about this until the evidence is heard. The only issue here is whether the applicant "Berno Brothers Pty Ltd" should have leave to amend the plaintiff's name from "Joe Berno" to "Berno Brothers Pty Ltd". 15. If the plaintiff becomes "Berno Brothers Pty Ltd" the defence will need to be substantially amended, since the allegation plainly made for the defendant is that at no time did it enter into an agreement with that entity. Equally, it would seem that the defendant, at some stage, may also have to seek amendments, since it now appears to have counterclaimed against a non-existent plaintiff. That application has not yet been made and the defendant no doubt awaits the result of these proceedings before deciding what action it should take. However, I think I should regard these matters as not material to the present issue. See Metropolitan Oils Pty Ltd v Fortron Industrial Lubricants Pty Ltd at 337 where Toohey J says: "The Court should not be invited to look at the implications of granting or refusing relief and then be asked to reason back to the character of the application that is being made. It is the character of the application that determines its implications." 16. Bearing in mind the fact that the limitation period has long expired, I turn to the law applicable in these proceedings. That law has since been amended but the amendments are so worded that this plaintiff cannot rely upon them. The position takes a little explaining. 17. For at least a century, and obviously as a result of the Judicature Act and the Rules made thereunder (see HEL Vol I pp 646-647: HEL Vol XV 128-130), the general approach to applications to amend originating documents and pleadings has been liberal. In Clarapede and Co v Commercial Union Association at 263, Brett M.R. made that clear: "However negligent or careless the first omission may have been, and however late the proposed amendment, the amendment should be allowed if it can be made without injustice to the other side. There is no injustice if the other side can be compensated by costs." R.36.01(1) of the present Rules continues that broad philosophy. 18. However, the oft-cited case of Weldon v Neal decided that there was an injustice to the other side if the amendment permitted the party amending to prejudice the rights of the opposite party as existing at the date of the amendment, i.e. by defeating the Statute of Limitations. Lord Esher M.R. said at 395: "If an amendment were allowed setting up a cause of action, which, if the writ were issued in respect thereof at the date of the amendment, would be barred by the Statute of Limitations it would be allowing the plaintiff to take advantage of her former writ to defeat the statute and taking away an existing right from the defendant, a proceeding which, as a general

Joe Berno v Green's Steel Construction Pty Ltd [1991] NTSC 4; 103 FLR 133

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Joe Berno v Green's Steel Construction Pty Ltd [1991] NTSC 4; 103 FLR 133 (1 February 1991)