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11 Jul 2011
Appeal Status
Not appealed

Court declines leave to amend claim after judgment delivered

2011 case note - Court declines leave to amend claim after judgment delivered - judicial review, settlement, costs.

Dunphy & Ors v Commissioner of Inland Revenue

Income Tax Act 1976


An applicant unsuccessfully applied for leave to amend his claim after the judgment granting judicial review had been delivered and after the applicant and the Commissioner had settled all matters in relation to the proceeding.

Impact of decision

Beyond the specific circumstances of the case, this judgment confirms the conclusive nature of a settlement entered into by parties that settles all matters in a proceeding.


On 28 April 2010, Chisholm J granted three taxpayers applications for judicial review, directing the Commissioner of Inland Revenue ("the Commissioner") to reconsider those taxpayers' claims for tax refunds on the strength of the Privy Council's decision in Peterson v Commissioner of Inland Revenue [2006] 3 NZLR 433. The claims for refunds related to those taxpayers investments in the film Utu.

It was anticipated that the claims for refunds by the other applicants in the proceedings would be resolved in accordance with that judgment. However, in his judgment, Chisholm J reserved leave to any party to apply further "should clarification of any of these orders be required".

In a memorandum dated 18 May 2011, counsel for the applicants advised that all the applicants' claims had been resolved save for the claim of the fourth applicant, Mr Robert Maxwell. In respect of Mr Maxwell, counsel sought an order amending the statement of claim and, if that amendment was permitted, an order directing the Commissioner to reconsider Mr Maxwell's claim in light of it.

Specifically, counsel for the applicants sought to amend Appendix 4 of the amended statement of claim, changing the amount Mr Maxwell had invested in Utu from $20,000 (as currently pleaded) to $40,000 (the purported actual amount). It was noted that the $40,000 amount had been included in the initial statement of claim filed.

In a memorandum dated 27 May 2011, counsel for the Commissioner strongly opposed the application on the basis that, amongst other things, a settlement deed had been entered into which settles all matters between Mr Maxwell and the Commissioner in relation to the proceeding. Counsel further queried whether the application came within the reserved leave to apply for clarification of any of the orders in Chisholm J's substantive judgment of 28 April 2011.


Chisholm J dismissed the application finding that:

  • Assuming for the moment that there is jurisdiction to grant leave for the fourth applicant's [Mr Maxwell's] pleading to be amended at this late stage, I am not prepared to grant leave. The proposed amendment is not within the scope of the "clarification" leave reserved to the parties in the substantive judgment. More importantly, the parties appear to have settled all matters in relation to this proceeding.
    The application is dismissed. There will be an order for costs on the 2B scale against the fourth applicant in favour of the respondent [7].

His Honour assumed that the applicant did not intend to file any further documentation given the time that had passed since counsel for the Commissioner's memorandum had been filed.