SCHUTZ MOTION TO FILE FOURTH FURTHER AMENDED STATEMENT OF CLAIM
11 Subsequent to the hearing, on 17 August 2011 consent orders were made in relation to the proposed amended pleadings. The orders provided for VIP to notify Schutz and the Court on whether they would consent to the amended pleadings. VIP did not consent to the amendments.
12 The substance of the amendment proposed by Schutz in the proposed amended pleading relates to the claim, by Schutz, for removal of VIP's ECODRUM trademark from the Register of Trademarks.
13 By para 74G of the third further amended statement of claim for Schutz, there is a plea referring to the manufacture of the Schutz drum container products in various countries since in or around 2001 and the promotion of those products under the ECODRUM trademark owned by Schutz GMBH. It reads as follows:
74G Since January 2001, Schütz Germany has by itself, its licensees and subsidiaries, manufactured ECODRUM Products in Germany, Norway, England, Ireland, the United States, Argentina, Mexico and Australia, and promoted and sold ECODRUM Products worldwide.
14 As is made clear in the seventh affidavit of Mr Steven Johnston, sworn on 2 June 2011 (the 7th Johnston affidavit) (at [32]), that the reference to 'Australia' in para 74G was included in that paragraph in error. It does not accord with the true factual history of the manufacture and sale of Schutz drum container products in Australia. Accordingly, the proposed amendment simply corrects that error and proposes to add para 74GA and para 74GB so as to clarify the position. Those paragraphs are in these terms:
74GA Since in or around July 2003, Schütz Australia has promoted and sold in Australia drum containers manufactured by Schütz Germany for use in the transport and storage of non-dangerous and dangerous goods under the Schütz Mark.
74GB Since in or around October 2006, Schütz Australia has manufactured, promoted and sold 220L closed head drum containers in Australia for use in the transport and storage of non-dangerous and dangerous goods under the Schütz Mark.
15 In exchanges prior to the hearing, VIP raised objections to the proposed amendments contending that the amendments proposed amounted to withdrawal of an admission to the effect that Schutz promoted and sold ECODRUM products in Australia from 2001.
16 Under the Federal Court Rules (FCR) applicable at the time this interlocutory dispute was argued, the power of the Court to grant leave to withdraw an admission was contained in O 18 r 1(2) FCR. Relevantly to this proposed amendment, to withdraw an admission an applicant is required to satisfy the Court that an error or mistake has been demonstrated; there is a sensible explanation for the making of the admission based on evidence of a solid and substantial character; and no injustice will be occasioned by withdrawal of the admission other than hardship by delay or cost which can be accommodated by an appropriate order for costs: Murran Investments Pty Ltd v Aromatic Beauty Products Pty Ltd (2000) 191 ALR 579 (at [45]).
17 VIP argues that the withdrawal of the admission of use of the ECODRUM trademark in Australia is surprising in circumstances where the remainder of Schutz' pleading, such as para 74N and para 75S of the third further amended statement of claim, continues to positively assert that Schutz has used the ECODRUM trademark in respect of its drum containers in various jurisdictions around the world since 2001. Further, in relation to claims by Schutz that VIP's predecessor wrongly obtained the mark from Schutz, VIP argues that it is particularly difficult to reconcile the denial of the use of the ECODRUM trademark in Australia with the assertion by Schutz of a s 52 TPA claim, presumably based on its reputation in Australia and in respect of that name. VIP points to the fact that Schutz' use of the ECODRUM trademark is further confirmed by the evidence which has been filed by VIP relating, for example, to the use on its website in Australia.
18 VIP contends that Schutz has provided no adequate explanation as to whether the admission as to the use of the ECODRUM trademark in Australia was by mistake. VIP argues that the evidence of Mr Johnston is limited only to the issue of the change of date of commencement of manufacture and sale of the products in Australia. In relation to the issue of the use of the ECODRUM trademark, Mr Johnston makes no more than a bare assertion that Schutz has sold relevant products under the 'Schutz' trademark.
19 Schutz argues that the amendment does not constitute withdrawal of any admission because the 'bundled up' plea in para 74G was not clear in any event.
20 Secondly, and perhaps more importantly, Schutz argues correctly that the purpose of the pleadings is to define the issues between the parties. The purpose will only be achieved if the plea at para 74G is amended to reflect the actual or true factual position. Schutz relies upon the observations by Bowen LJ in Smith v Cropper (t/a HS Cropper & Co) (1884) LR 26 Ch D 700 (at 710-711) (also noted with approval in Celestino, R. v. Celestino, A [1990] FCA 449) where Bowen LJ said:
… that the object of Courts is to decide the rights of the parties, and not to punish them for mistakes they make in the conduct of their cases by deciding otherwise than in accordance with their rights. Speaking for myself, and in conformity with what I have heard laid down by the other division of the Court of Appeal and by myself as a member of it, I know of no kind of error or mistake which, if not fraudulent or intended to overreach, the Court ought not to correct, if it can be done without injustice to the other party. Courts do not exist for the sake of discipline, but for the sake of deciding matters in controversy, and I do not regard such amendment as a matter of favour or of grace. Order XXVIII. rule 1, of the Rules of 1883, which follows previous legislation on the subject, says that, "All such amendments shall be made as may be necessary for the purpose of determining the real questions in controversy between the parties." It seems to me that as soon as it appears that the way in which a party has framed his case will not lead to a decision of the real matter in controversy, it is as much a matter of right on his part to have it corrected, if it can be done without injustice, as anything else in the case is a matter of right.
21 The observations by Bowen LJ in a succinct manner conform with what was said in Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175, as long as the expression 'without injustice' is understood to include the injustice that may be occasioned by unnecessary delay and the consequential cost. There is, in my view, no basis at present for a conclusion that the amendment would give rise to any real injustice. As observed in the authorities discussed above and more recently by Flick J in AMI Australia Holdings Pty Ltd v Bade Medical Institute (Aust) Pty Ltd (No 2) (2009) 262 ALR 458 (at [50]), the central principle applying to the discretion to grant leave to amend is to do justice between the parties.
22 To the contrary, I accept the submissions from Schutz that the amendment is appropriate as it has been established that the inclusion of the reference to Australia in para 74G was in error. The error was detected shortly prior to the motion being pursued and the amendment sought promptly after it was detected; the sole purpose of the amendment is to correct the factual error; the proceedings are not so far advanced that the amendment will cause any real disruption to the programming of the matter to trial. It is by no means apparent that VIP will suffer any real prejudice by reason of the amendments.
23 The amendment is permitted. Schutz should pay any costs thrown away by reason of the amendment.