1. Following
upon the judgement of this Court delivered on the 29th June 2000, a Notice of
Motion was filed dated 3rd July 2000 on behalf of the Petitioners, Martin Wolfe
and Ruth Wolfe, seeking liberty of the Court to re-amend the amended Petition
heretofore delivered in this case.
3. Order
125 Rule 1 of the Rules of the Superior Courts, 1986, defines,
“Pleading”
has including a petition, and there is nothing in Order 28 Rule 1 of the same
Rules which would render such inclusion repugnant to its operation.
4. There
can be no question but that the re-amendment sought in this case is in the
words of Morris P., in the case
of
Rubotham (infant) -v- M & B Bakeries Limited
(1993)
ILMR219 at 221,
5. In
my judgment in the absence of some special circumstances, as where the party
opposing the amendment has rights existing at the date of the application to
the Court, such as the benefit of the Statute of Limitations, which would be
thereby prejudiced, the mere novelty of the proposed re-amendment does not
represent a barrier to its being permitted by the Courts. I adopt the
following passage from the judgment of Morris P. in the case of Rubotham
(infant) versus M & B Bakeries Limited, (above cited) :-
6. I
have reached the conclusion that the re-amendment sought by the petitioners is
necessary in the interest of justice and for the purpose of ensuring that what
are very obviously the real and principal questions in controversy between the
parties are before the Court. In reaching this conclusion I am satisfied that
any prejudice suffered by the Respondents will be remedied by the adjourned of
the trial, an Order for costs and the imposition of a condition that the
Petitioners shall forthwith furnish to the Respondents an indemnity against all
extra costs and expenses which may reasonably be incurred by the Respondents in
dealing with the re-amendment.
(DPP
-v- Corbett,(
1992)
ILRN,6754 at 678, per Lynch J, adopted by
Kinlen
J in Bell -v- Pederson and Sandoz Ringaskiddy Limited,
(1995) 3 ILLRN 511 at 518 and 519 ).
7. The
Court will permit the delivery of a re-amended petition in the form annexed to
the aforementioned Notice of Motion provided that :-
8. The
re-amended petition shall be indorsed as provided by Order 28 Rule 9 of the
Rules of the Superior Courts, 1986, and each re-amendment shall be signified by
underlining with two parallel horizontal red lines.
9. Counsel
for the first and second named Respondents and Counsel for the third named
Respondents did not oppose the application by the petitioners to re-amend the
petition, but made the case that the petitioners should not be permitted to
amend without paying not only the costs of the re-amendment and undertaking to
pay any costs incurred by the Respondents consequent upon the re-amendment, but
also all costs incurred by the Respondents and thrown away up to the date of
the adjournment of the proceedings which adjournment was rendered necessary by
the re-amendment. They argued that having regard the terms of Order 28 Rule 1
of the Rules of the Superior Courts, 1986, the necessity for the Court to hold
the balance of justice fairly between the parties meant that without such an
Order in favour of the Respondents the Court was in effect prohibited from
granting the relief sought by the Petitioners.
10. I
prefer to be guided by the dictum of Murphy J., (Barrington J., concurring),
in the course of his judgment in
Aer
Rianta International CPT -v- Walsh Western
International
Limited,
(1997) 2IRLM. 45 at 51 where he held that:-
11. In
the course of determining what would be the appropriate Order for costs to be
made in this case I have considered a number of decisions in this jurisdiction
and in England.
12. The
Plaintiff appealed to the Supreme Court. The Supreme Court allowed the
Plaintiff's appeal. In his judgment, Ó'Dalaigh C.J, held:-
13.
The
Court directed that the Defendants should bear the costs of the adjournment of
the action, such costs to be on the basis of “
costs
of the day
”
as defined by Order 99 Rule 37 (33) of the then Rules of the Superior Courts,
replaced as of the 1st of October 1986 by Order 99 Rule 37 (33) of the Rules of
the Superior Courts 1986.
14. “Costs
of the day” have been defined as meaning, “all costs incurred, and
which will be thrown away in consequence of the slip”.
(Bourgoine
-v- Taylor,
(1878) 47.LJCH. 542 at 543 per Jessell L.J.) Order 99 Rule 37 (33) of the
Rules of the Superior Courts, 1986, provides as follows;-
15. None
of the considerations outlined by Ó'Dalaigh C.J. in
Fahy
-v- Pullen
(above cited) arise in the present case. The Respondents are now faced with
having to prepare for and to meet what is substantially a new case raising new
issues of fact and new and very complex issues of law. An Order for costs of
the day in favour of the Respondents as defined by Order 99 Rule 37(33) of the
Rules of the Superior Courts 1986 would not in my judgment be sufficient in
this case, “ for the attainment of justice or for enforcing or defending
the rights of the Respondents”.
16. In
the Court of Appeal the Applicant's argument against this condition is set out
in the judgment of Russell L.J, at page 42 of the Report as follows:-
17. The
Court of Appeal (Russell, Karminski, L.J.J., and Sir Gordon Willmer), rejected
this argument and confirmed the Order of the trial judge. In the course of
their Judgments, Russell, L.J, and Karminski L.J, referred, but in a different
context, to the decision in
E.M.
Bowden’s Patent Syndicate Limited -v- Herbert Smith and Company
,
(1904) 2 CH 86 and 122, where the Plaintiff as the equitable owner of a patent
was given liberty to amend its pleading by joining the legal owner, (failing
which the Plaintiff’s case would have been dismissed), but on terms that
the Plaintiff paid the Defendant's costs of the two days of hearing up to that
point.
18. In
my judgment the facts of the present case are significantly different from
those in
Fahy
-v- Pullen
(above cited), and
O’Driscoll
-v- Irish Shell and BP Limited
(above cited). As is apparent from the re-amended petition a number of the
matters in issue between the parties at the adjourned hearing will remain
issues at the next hearing. However, for this Court to allow only,
“costs of the day”, as described in Flynn and Halpin,
“Taxation of Costs” (1999), pages 130 and 137, would be to fail to
recognise the substance and fundamental importance of the re-amendment, the
time and circumstances at and under which the re-amendment came to be sought
and the probable impact of the re-amendment on the future course and conduct of
the proceedings. On the other hand to allow costs to the Respondents on a full
party and party basis as if the petition had been discontinued or had been
fully heard and determined in favour of the Respondents would in my judgment be
unjust and oppressive to the Petitioners.
19. What
in my judgment will do justice between the parties is an Order for costs in
favour of the Respondents on a party and party basis but confined to Counsels'
fees, witnesses' allowances and expenses, the Solicitor’s proper charges
for attending in Court and such other fees disbursements and charges as relate
solely to the preparation of the adjourned trial and which will require to be
repeated or will be of no value at the next hearing. The amendments made to
the petition are so material that it is virtually certain that even should the
same Counsel remain on in the matter they will nonetheless have to newly
prepare the case and on this basis I consider it reasonable to allow brief fees
to Counsel for the Respondents and in addition four only refreshers to Counsel
for the first and second named Respondents and one only refresher to Counsel
for the third named Respondents.
20. The
Respondents are also to be entitled to the costs of taking this Judgment and
the costs of taking the Judgment of the Court delivered on the 29th June 2000.
They are also to have the costs of the Motion to re-amend the Petition and all
costs and expenses of their consequential amendments. The Petitioners shall
forthwith furnish to the Respondents an indemnity in respect of these latter
costs.
21. It
was urged upon me by the Respondents that I should as a condition of permitting
the Petitioners to re-amend their Petition and proceed with this action require
the Petitioners to give security for whatever costs the Court might award
against the Petitioners or alternatively that I should not alone permit the
Respondents to proceed forthwith with the taxation of those costs but should
also grant liberty to them to seek payment of those costs as soon as taxed and
make such payment a condition of the Petitioners proceeding further with this
action.
22. At
page 137 of Flynn and Halpin, “Taxation of Costs”, the authors
referring to, “costs of the day” and “costs thrown
away” and citing Greenslade, “On Costs”, p.1 : 25 (1993)
REL3, state that:-
23. An
order for security for the costs awarded was made by the trial judge in the
case of
Ascherberg
Hopwood -v- Casa Musicale,
(above cited). The purpose of this order was described by Russell L.J. In the
Court of Appeal as being :-
24. In
each of those cases there may have been facts which justified the Judge in
exercising his discretion in imposing the condition which he did. In the
present case there are no facts in evidence before me which would justify the
making of an order that the Petitioners as a condition of being permitted to
re-amend their petition and proceed with the action should either pay the costs
which the Court has awarded to the Respondents or should give security for
those costs.
25. There
is no evidence before me that the Petitioners would be unable to pay or would
seek to avoid paying costs. Apart from any other assets which they might have
in the jurisdiction, as to which I have no evidence, the Petitioners are the
admitted owners of 10.172
per
centum
of the shares in John Atkins & Company Limited. This company, according to
a statement of affairs presented at a meeting of the company on the 21st of May
1996 for the purpose of Section 60 of the Companies Act, 1963, had capital
reserves of £1,812,984.00 and in the year ending 31st October 1997 paid an
increased dividend notwithstanding an operating loss of £61,927.00.
Having regard to the usual one third basis upon which a sum to be lodged as
security for costs is assessed it seem to me that no case could be made by the
Respondents that the Petitioners would not be able to pay the costs
hereinbefore awarded.
26. At
paragraph 9 of the Affidavit of Cormac O’Hanlon, Solicitor, of J W
O’Donovan, Solicitors who are solicitors for the Petitioners in these
proceedings, sworn on the 3rd of July 2000 for the purpose of grounding the
Motion to re-amend it is stated as follows:-
27. This
averment is not rebutted in any replying Affidavit by or on behalf of the
Respondents. There is no evidence before me that either through negligence or
recklessness the Petitioners permitted this action to come to trial knowing
that the Petition was deficient and that permission to amend would have to be
sought from the Court, meanwhile allowing the Respondents to incur very
substantial costs and expenses.
28. In
my Judgment for this Court in these circumstances to order that the Petitioners
should pay costs by this Judgment awarded to the Respondents as a condition of
their being permitted to re-amend the Petition and to rely upon these
re-amendments at the adjourned hearing of this action would be to penalise the
Petitioners for the error made and I do not accept that this Court has any such
power, or if it did that on the evidence I have any rational or logical
justification for invoking that power.
29. In
the course of his Judgment in
Cropper
-v- Smyth (1883) 26Ch.D. 700 at
710/711,
Bowen L.J.
held as follows:-
30. This
passage had been cited with approval by
Flood
J., in Palamos Properties
Limited
and O’Neill -v- Brooks and Ors (1996) 3IR597 at 603;
by the Supreme Court,
(Murphy J), in Aer Rianta International CPT -v- Walsh Western International
Limited,
(1997) 2ILRM 45 at 51
;
and
O’Sullivan
J in Cornhill and Ors -v-
The
Minister for Agriculture and Food,
(13th of March 1998), (unreported but copy judgment available).
31. I
therefore decline to order that the Petitioners give security for costs or pay
such costs as a condition of being permitted to re-amend their Petition and
proceed with this action. I will however order that the Respondents be at
liberty to proceed forthwith with the taxation of the costs hereinbefore
awarded, but not for their payment.