Daryanani v Kumar & Co (a Firm) & Anor

An appellate court will not interfere with refusal of an amendment where, after hearing the claimant’s evidence, the amended case is bound to fail. A claimant must also remain within the issues permitted by earlier procedural orders and cannot repeatedly shift the basis of the claim. Late material may properly be excluded where its provenance and circumstances are unexplained, it is irrelevant to the pleaded case, or its use would evade an existing restriction. Where the permitted pleading discloses no tenable cause of action, the claim may be struck out or dismissed.

The claimant sued his former solicitors and barrister, alleging that they negligently compromised earlier property litigation without proper authority or advice. During the trial, the claimant sought to amend his pleaded loss case. Lloyd J heard his evidence before refusing permission to amend, concluding that the proposed case had no realistic prospect of success, and struck out the action because the existing pleading was barred by an earlier order.

The claimant applied for permission to appeal. He alleged procedural irregularity, principally that the judge had wrongly refused to consider a late-produced page of correspondence said to support the prospects of success in the earlier litigation.

1. Application refused. Chadwick LJ held that there was no realistic prospect that the Court of Appeal would interfere with Lloyd J’s decision.
2. The judge was entitled to hear the claimant’s evidence before deciding whether to permit the proposed amendment. The proposed case depended on establishing that, absent the alleged negligence, the earlier action would have proceeded to trial and that the claimant would have obtained a substantially more favourable judgment. On the evidence, the claimant had lost no more than a fanciful or negligible chance of that outcome. The amended case was therefore bound to fail.
3. The original pleading could not succeed because the claimant was expressly debarred by Judge Hicks’s order from advancing the particular compromise or counterfactual settlement on which his pleaded financial loss depended. Having refused the amendment, Lloyd J was entitled to strike out or dismiss the action as disclosing no tenable cause of action within the permitted issues.
4. The judge was also entitled to refuse to consider the second page of the late-produced letter. Its provenance, recipient, circumstances and discovery were unexplained. It was not evidence of the result that would have followed a trial of the earlier action, and reliance on alternative settlement terms would have conflicted with the earlier procedural order.
5. The claimant had accepted that his revised case was based on success at trial rather than a further compromise. In those circumstances, the judge was entitled to prevent him from shifting ground again. Permission to appeal was refused.

• Court of Appeal (Civil Division): On 22 March 2001, permission to appeal from Lloyd J’s order was refused.
• Chancery Division: Lloyd J refused permission to amend after hearing the claimant’s evidence and struck out the action as bound to fail.
• High Court: His Honour Judge Hicks QC allowed an appeal from the Master’s summary dismissal order, but imposed restrictions on the allegations that could be pursued and directed transfer to the Chancery Division.
• Court of Appeal: On 12 December 2000, the defendants’ appeal against Judge Hicks QC’s order was dismissed.