IDDQD Limited v Codeberry Limited & Anor

An appellate court reviewing refusal of permission to amend under Civil Procedure Rules 1998, r 17.3, should interfere only for a recognised error in the discretionary exercise, procedural unfairness or a plainly wrong decision. The court must balance the merits and importance of the proposed case against delay, prejudice, disruption, resource implications and the risk to the trial date.

Defences of estoppel, waiver and laches require an adequately pleaded and evidentially supported factual basis. Estoppel requires, at least, a representation, reasonable reliance, action on that reliance and resulting detriment or unconscionability. Detrimental reliance is usually an essential ingredient of laches. Bare allegations and evidence showing only a claimant’s failure to pursue an audit do not satisfy those requirements.

The defendants appealed from Master Pester’s refusal on 21 January 2025 to permit amendments to their Defence adding estoppel, waiver, consent and laches defences. The underlying claim concerned alleged breaches of contract and infringement of database right and copyright arising from the defendants’ search and verification services.

The proposed case relied on the claimant’s alleged knowledge of the defendants’ activities, its failure to act before February 2023, and the defendants’ continued investment and failure to obtain a commercial licence. The issues were whether the evidence and pleading disclosed a properly arguable defence and whether the Master had wrongly assessed lateness, prejudice and trial disruption.

1. The appeal was dismissed. The Master had made no error of law and had exercised his discretion correctly.

2. Under Civil Procedure Rules 1998, r 17.3, the discretion to permit amendment is broad but must be exercised in accordance with the overriding objective. Relevant considerations included the strength and coherence of the proposed case, compliance with procedural obligations, the timing and explanation for delay, prejudice, resource implications and the risk to the trial date. An appellate court’s role is limited to reviewing the exercise of discretion for recognised error, procedural unfairness, failure to consider relevant matters, consideration of irrelevant matters or a plainly wrong conclusion.

3. The defendants’ evidence did not support the proposed defences. The claimant’s request to audit and its failure to pursue the audit were not a representation. The evidence showed only the defendant’s interpretation of events and did not establish reliance on a representation or action taken upon such reliance.

4. The pleading was also deficient. Estoppel required a representation, reasonable reliance, action on that reliance and resulting unfair detriment. The pleaded facts did not show a belief that the defendants were entitled to continue their conduct without interference. Continued investment and failure to obtain a licence were at least equally consistent with a decision to continue infringing while hoping to avoid enforcement.

5. Laches is less structured than estoppel, but reliance cannot simply be ignored. In the ordinary case, some detrimental reliance is an essential ingredient of the equitable balance of justice. The evidence and pleading disclosed no real prospect of a successful laches defence.

6. The application was issued at the last permitted moment despite the defendants’ earlier knowledge of the relevant matters. Further disclosure, evidence and pleading would have been required, creating unrealistic and inappropriate disruption to the imminent trial. The importance of the proposed defences, including their potential to provide a complete defence, had been taken into account but did not outweigh the other factors.

• High Court (Chancery Division): The appeal from Master Pester’s order dated 21 January 2025 was dismissed. Permission to appeal had been granted by Meade J on 14 March 2025.