CPL Ltd v CPL Opco (Trinidad) Ltd

Permission to join a party and amend pleadings should be refused where the proposed claim would not survive strike-out or summary judgment. Where the proposed party is foreign, that threshold reflects the merits standard applicable to service out of the jurisdiction.

Very late amendments require the court to balance the applicant’s potential injustice against prejudice to the opposing party, other litigants and the efficient use of court resources. The court must consider the strength of the new case, the explanation for delay, the consequences of losing a fixed trial date, wasted work and the practical adequacy of costs as compensation.

The claimant sought to join Hastings, the indirect parent company of the existing defendant, and to amend its particulars of claim shortly before a seven-day trial. The proposed claim alleged that Hastings had made an oral promise to share primary liability for the defendant’s payment obligations, or had assumed such liability through its conduct in paying invoices.

The existing defendant disputed the amount claimed and alleged settlement. The application raised the arguability of the proposed claim, the lateness of the application and the balance of prejudice, including the risk that the fixed trial date would be lost.

1. Joinder threshold. The court held that the applicable test was the test for amendment generally. Joinder should not be permitted where the proposed claim would not survive strike-out or summary judgment, since permitting such a claim would waste court and party resources. In the case of a foreign proposed party, this reflected the merits threshold for service out of the jurisdiction.
2. Arguability of the proposed claim. The formal SPA and Participation Agreement made an additional oral agreement less likely, particularly because the latter contained a mechanism for requiring a guarantee. They did not, however, make the alleged oral promise wholly implausible or suitable for summary determination. Whether the promise was made, and whether the alleged speaker had authority, were fact-sensitive issues requiring disclosure and cross-examination.
3. Pleading defects. The oral-promise claim had a real prospect of success, subject to providing further particulars of the words alleged and pleading the consideration said to have been provided by entering into the Participation Agreement. The allegation that the collateral contract was formed merely by Hastings paying invoices was hopeless, because the payments were equally consistent with voluntary discharge of the defendant’s liabilities. The alternative allegation that the payments evidenced an existing collateral agreement was sustainable if properly pleaded.
4. Lateness and prejudice. The principles stated in Quah Su-Ling v Goldman Sachs International [2015] EWHC 759 (Comm) were adopted. The claimant’s explanation for delay was weak, but the application was made three months before trial, the proposed issues were limited, and Hastings’ conduct had delayed the application. Relitigating substantially the same matters in separate proceedings would waste resources. Those unusual circumstances shifted the balance in favour of joinder despite the lateness.
5. Order. Hastings was joined as a defendant. Amendment was permitted in respect of paragraphs 25 to 28 of the draft re-amended particulars, subject to the qualifications concerning particularisation and consideration. The allegation based on the formation of a collateral contract solely through invoice payments was not permitted.

First-instance application in the High Court (Chancery Division). No appellate history is stated in the judgment.