Have you ever, be it as a lawyer or a client, encountered scenario where at the stage where the pleadings have been closed (close of pleadings) and the matter has already entered the stage close to pre-trial case management or trial, you suddenly found a new claim, cause of action, defence, fact, evidence or statement that was not pleaded before in either Statement of Claim, Statement of Defence and/or Reply to Defence? In this article, we are going to delve deep into the discussion whether we can amend the pleadings when the pleadings have been closed based on courts’ decisions from landmark cases as well as recent cases in Malaysia.
Generally, the application to amend pleadings is governed under Order 20 Rule 5 Rules of Court 2012: “… the Court may at any stage of the proceedings allow the plaintiff to amend his writ, or any party to amend his pleading, on such terms as to costs or otherwise as may be just …”
The trite law on the amendment of pleadings with the Court’s leave is governed by the landmark Federal Court’s decision in Yamaha Motor Co Ltd v. Yamaha Malaysia Sdn Bhd & Ors[i]. The Federal Court held that:
Under Order 20 of the Rules of the High Court 1980, which is equivalent to Order 28 Rules of Supreme Court, a Judge has a discretion to allow leave to amend pleadings. Like any other discretion, it must of course be exercised judicially (see Kam Hoy Trading v Kam Fatt Tin Mine [1963] MLJ 248. The general principle is that the court will allow such amendments as will cause no injustice to the other parties. Three basic questions should be considered to determine whether injustice would or would not result, (1) whether the application is bona fide; (2) whether the prejudice caused to the other side can be compensated by costs and (3) whether the amendments would not in effect turn the suit from one character into a suit of another and inconsistent character. (See Mallal’s Supreme Court Practice page 342). If the answers are in the affirmative, an application for amendment should be allowed at any stage of the proceedings particularly before trial, even if the effect of the amendment would be to add or substitute a new cause of action, provided the new cause of action arises out of the same facts or substantially the same facts as a cause of action in respect of which relief has already been claimed in the original statement of claim. (emphasis added)
Yamaha Motor case underlined three main questions for the applicant to prove which are:
1. Whether the application is made bona fide;
2. Whether the prejudice caused to the opponent can be compensated by costs; and
3. Whether the amendment would turn the suit from one character into a suit of another and inconsistent character.
In Alloy Consolidated Sdn Bhd & Anor v. Dato’ Dr Haji Adam Harun[ii], the Federal Court’s decision which was in affirmative with Yamaha Motor case held that the court may at any stage of the proceedings allow either party to amend his pleadings and the amendments shall be made as may be necessary for the purpose of determining the real question between the parties and the rule permits amendments at any stage and it does not matter whether the original omission arose from negligence or carelessness. However, such amendments are allowed only where there occasion no injury and cause no injustice to the opposite party or where they can be sufficiently compensated by costs.
In Suhaili bin Ismail v. Syarikat Sribima Sdn Bhd[iii], the Court of Appeal held that the amendment of pleadings could be applied and granted at any stage of the proceedings even after the close of pleadings and the judge was of the opinion that the proposed amendments were necessary so that all questions in controversy could be determined.
The amendment application is made bona fide and there is cogent and reasonable explanation in the delay of filing the amendment application
Further to the above trite principles in Yamaha Motor case, the Federal Court in Hong Leong Finance Bhd v. Low Thiam Hoe and Another Appeal[iv] had extended the principles to include ‘reasonable explanation for the delay in amending the pleadings’ to be stated in the affidavit:
[33] Having considered the facts and the circumstances of the present case, our views are as follows:
(a) when dealing with an application to amend the pleadings, which introduce a new case in the claim or defence, on the eve of the trial, the principles in Yamaha Motor are not the sole considerations;
(b) the principles in Yamaha Motor applies to cases where the application to amend the pleadings is made at an early stage of the proceedings;
(c) that there has to be a cogent and reasonable explanation in the applicant’s affidavit as to why the application was filed late;
(d) that the application to amend the pleadings is not a tactical manoeuvre;
(e) that the proposed amendment must disclose full particulars for the court to ascertain if there is a real prospect of success in proving the same; and
(f) that lateness in the application to amend the pleadings cannot necessarily be compensated by payment of costs.” (emphasis added)
In Tenaga Nasional Bhd v. Ice Man Sdn Bhd[v], the court held that the defendant’s application did not promote the speedy disposal of the case and was more of a tactical maneuver and by making the amendments at this late stage raised doubts about the bona fide of the application. A bona fide application would explain the reason for the delayed amendments and whether the proposed amendments had any prospect of success.
The undue delay in filing an application to amend pleadings was affirmed in Raphael Pura v Insas Bhd & Anor[vi] where the Court of Appeal in dismissing the appellant’s application to amend his defence held that there is a lack of bona fide on the part of the appellant where the application is made close to the trial dates and there was no cogent reasons for such delay in filing the application to amend such pleadings. The Court of Appeal further added that an application for amendment of pleadings is not as a matter of a right of a party but is left to the judicial discretion of the court depending on the circumstances of each case.
In another Court of Appeal case of Stadco Sdn Bhd v Woolley Development Sdn Bhd[vii], the Court in dismissing the application held that it would be prejudicial to the respondent if the proposal to amend were to be allowed at this very late stage of the proceedings and a litigant cannot be allowed to amend his pleading at anytime he likes at his whims and fancy.
The prejudice caused to the opponent can be compensated by costs
The court in ASM Development Sdn Bhd v. Hijjas Kasturi Associates Sdn Bhd[viii] had discussed on what amounts to prejudice to the opponent that cannot be compensated by costs. The court held that whether it would be unjust and prejudice to the opponent requires a balancing of applying party’s need to amend and the prejudiced to the opposing party’s interest. Prejudice in the context of amendment of pleadings is whether the defendant will or may have difficulty in defending the amended claim, specifically at the trial. For example, if reliance was made to the original claim and later it was amended, it would be more difficult for the defendant to defend the new claim.
"It should, however, be stressed that the proper test which the courts apply, is not whether in allowingthe amendment, it would cause injustice to the other party, but whether in the circumstances of the case, it is just to grant leave. In considering whether it is just to grant leave, the courts must necessarily consider the interests of both parties: whether injustice would be caused to theapplicant if leave is not allowed, and whether injustice would be caused to the defendant if leave is granted. Therefore, in exercising its discretion, the courts have to balance the prejudiced involved to both the parties in allowing or disallowing the amendment." [Emphasis added]
The amendment would turn the suit from one character into a suit of another and inconsistent character
In K Rajashekar a/l Kanapathy & Ors v Palm Court Condominium & Ors[x], the court in dismissing the plaintiff’s application to amend the statement of claim held that although the facts were already mentioned in the original statement of claim, they were not part of the factual structure on which the plaintiff’s cause of action was based and as such, it was held that such application if allowed, would turn the suit from one character into a suit of another character and inconsistent character. In this case, the original claim in the statement of claim is for damages for the actions of the joint management body in moving the main entrance while in the proposed amendments, the Plaintiff sought to have the tenancy agreements declared null and void based on the illegality of the partitions further claimed for restitution. The Court further held that the Plaintiff’s claim for damages would be converted into a claim for rescission of the agreements based on a completely different factual structure.
Conclusion
Although there are the three main questions in Yamaha Motor case as the tests for the applicant to prove to obtain leave to amend pleadings after close of pleadings, the cases have shown that it is a discretionary power to be exercised by the court according to the justice of the case albeit the amendment application was made late at the eleventh hour. The power of the court however is not to be exercised willy-nilly and it should still be guided in the exercise of the discretion by his assessment of where justice lies.
[i] [1983] 1 MLJ 213
[ii] [2011] 5 CLJ 705
[iii] [2015] 6 MLJ 556
[iv] [2016] 1 MLJ 301
[v] [2020] 6 CLJ 783
[vi] [2001] 1 MLJ 49
[vii] [2013] 6 MLJ 297
[viii] [2011] 6 MLJ 228
[ix] [1995] 1 CLJ 693
[x] [2014] 9 MLJ 297
Authored by Hussaini Rozi
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