The High Court has given a sharp and very clear message that late in the day amendments to pleadings at commencement of a trial or close to trial require the exercise of the discretion by the primary judge to take into account what the Chief Justice described as the “irreparable element of unfair prejudice in unnecessarily delaying proceedings”.

Late in the day amendments to pleadings will now be a risk management issue in the conduct of litigation. If you need to amend in the six months prior to trial it will be an increasingly greater risk the later in time the application is made.

All judgments of the Court supported the observations of the Chief Justice that the time of the Court is a publicly funded resource. Inefficiencies in the use of that resource arising from the vacation or adjournment of trials are to be taken into account. So too is the need to maintain public confidence in the judicial system. Delays and costs are undesirable and delay has deleterious effects, not only upon a party to the proceedings in question, but to other litigants.

To the extent that the previous decision of the Court in Queensland v JL Holdings Pty Ltd [1997] supported the proposition that case management considerations and questions of proper use of Court resources are to be discounted and given little weight, those comments should no longer be regarded as authoritative.

Gummow, Hayne, Crennan, Kiefel and Bell JJ in a joint judgment ruled that an application for leave to amend a pleading should not be approached on the basis that a party is entitled to raise an arguable claim subject to payment of costs by way of compensation. There is no such entitlement. All matters relevant to the exercise of the power to permit amendment should be weighed. Taking into account substantial delay and wasted costs, the concerns of case management will assume importance on an application for leave to amend.

The joint judgment refers to limits that will be placed upon the ability to effect changes to pleadings, particularly if litigation is advanced. The days of the permissive practices of the past are long gone. The resolution of disputes serves the public as a whole not merely the parties to the proceedings.

The objectives of the case management rules as to timely disposal of cases and the limitation of costs are to be applied in considering an application for amendment. It was significant that the effect of its delay in applying would be that a trial date of four weeks was lost and litigation substantially recommenced. A just resolution of the claim necessarily had to have regard to the position of the defendant in defending it. An assumption that costs will always be a sufficient compensation for the prejudice caused by amendment is not reflected in Rule 21.

Heydon J was also critical of the primary judge Gray J in the delay in giving judgment on the application to amend. Ten months elapsed. “Unless there is some good explanation for that delay which has not been revealed to this Court, it is deplorable . . . ten months is an excessive period of reservation, even for the most complex of trials or appeals . . ., the delay in giving judgment in this case is alien to every axiom of modern litigation. It is particularly inappropriate in commercial litigation . . . what is the point of expediting interlocutory steps and fixing early trial hearings if judgments, particularly interlocutory judgments, are not “relatively speedy”?”.

Aon Risk Services Australia Ltd v Australian National University (2009) HCA 27 (5 August 2009)