Hayer v Hayer

Permission to amend a defence at a very late stage is governed by fairness to both parties. A judge who raises a possible point may ask whether a party wishes to pursue it, but must leave that choice to the parties and remain outside the arena. The court must consider the amendment afresh, including its lateness, explanation, evidential foundation, costs and the opponent’s need to investigate and answer it. If permission is granted, the opposing party must have a fair opportunity to cross-examine existing witnesses and adduce relevant evidence. An alternative case that a document was forged and, if signed, was procured by undue influence is not automatically barred by election, although its evidential weakness may justify refusal. The approach in Swain-Mason v Wills and Reed [2011] 1 WLR 2735 was applied.

The appellant claimed an order for the sale of a property which had been transferred to the respondent in 1996. A trust deed purported to give the appellant and respondent equal interests. The respondent’s pleaded case was that his signature on the trust deed was forged.

During closing submissions at trial, the judge raised concerns about whether the respondent had understood the transaction and might have acted under his father’s undue influence. The respondent then applied to amend his defence to plead undue influence, while maintaining the forgery case. The judge permitted the amendment but refused the appellant an adjournment to cross-examine further or adduce evidence. He subsequently set aside the trust deed.

The appeal concerned whether the amendment should have been allowed and whether the appellant should have been given an opportunity to meet the new case.

Appeal allowed. Arden LJ gave the leading judgment, with Richards and Patten LJJ agreeing.

1. A judge may raise a possible issue and ask whether a party wishes to advance a new case. The choice must remain entirely with the parties. The judge must not suggest that a particular case ought to be run or descend into the arena. The judge must remain outside it to preserve impartiality.
2. When the judge has prompted a proposed amendment, the court must consider independently whether it is in the interests of both parties and is a proper exercise of discretion. The judge must not assume that the point identified is necessarily a good one.
3. The undue-influence amendment introduced a new case. The appellant was entitled to test the evidence of witnesses already called, including the solicitor and the alleged influencer, and to consider further factual and valuation evidence. The judge was not entitled to determine in advance that further evidence could have no value or that a fair trial was impossible.
4. The approach to very late amendments in Swain-Mason v Wills and Reed [2011] 1 WLR 2735 required a balance between the parties. Relevant matters included the lateness of the application, the absence of a satisfactory explanation, the need for an adjournment and further evidence, the costs and strain of continued litigation, and the evidential basis for the new case. Those matters were relevant not only to an adjournment but also to permission to amend.
5. Maintaining a forgery case did not amount to an election preventing an alternative case that, if the document was signed, it was procured by undue influence. Undue influence could in principle be established by inference without express evidence. In this case, however, the absence of evidence that the alleged influencer instructed the execution, the respondent’s refusal to support the alternative case, and the unexplained tactical lateness made the case neither obvious nor easy.
6. The discretion was re-exercised against permission to amend. Ground 1 succeeded and ground 2 also succeeded if necessary. The remaining grounds were not considered.

• Court of Appeal (Civil Division): [2012] EWCA Civ 257. Appeal allowed. Permission to amend the defence was set aside; ground 2 was also accepted if necessary.
• Central London Civil Justice Centre: The trial judge permitted a late amendment pleading undue influence, refused an adjournment for the appellant to meet that case, and set aside the trust deed.