counterclaim if

paragraph 14 means. There can be no doubt that in that Facts in defence paragraph itself there is no specific statement of the facts upon only availwhich the defendant relies for the relief which he claims. The able for rules bearing on the subject are rules 3 and 10 of Order XIX. [His Lordship read them.] The 10th rule, in my opinion, incorpomeans that the defendant must state specifically in his counter- rated. claim, or as the Master of the Rolls expressed it in Holloway v. York, in the body of the counter-claim, the facts upon which he relies for relief. A counter-claim is intended as a substitute for a cross-bill, and therefore the facts upon which reliance is placed should appear in the counter-claim itself. If paragraph 14 alone is looked at, it is not disputed that the facts relied on do not appear. But it is said that the whole document is a defence and counter-claim, that it is an amalgamation of the two things, that the whole of it must be looked at together. I think that such a mode of pleading is not sanctioned by the rules, and that it would be highly inconvenient. If it were permitted, the result would be that in every case of a counter-claim the pleader would omit to state the specific facts upon which he relies by way of counter-claim, and would take his chance of picking them out of the statement of defence at the trial."

In the later case of The Birmingham Estates Company v. Smith (13 Ch. D. 506; 49 L. J. Ch. 251; 42 L. T. 111; 28 W. R. 666), the authorities on the subject were reviewed by Jessel, M. R., and the rule laid down that in a counter-claim a defendant may refer to statements of facts in the pleadings on which he intends to rely, without setting them out again in full. In this case the plaintiffs' company brought an action to set aside a deed under which they were liable to pay a large sum of money. The defendant put in a statement of defence and counter-claim. The facts on which the defendant relied were set out in detail in the statement of defence. The counter-claim was in the following words :-" By way of counter-claim the defendant refers to the indenture of the 26th of June, 1876, in the pleadings mentioned, and to the 16th and 20th paragraphs of the statement of defence;" and then followed the prayer of the counter-claim. It was objected, upon the authority of Holloway v. York, and Crowe v. Barnicott, that the counter-claim was insufficiently pleaded.

Facts in defence only avail

able for the

counterclaim if incorporated.

In giving judgment, Jessel, M. R., said: "Then the plaintiff company object to the counter-claim, not because this is not a proper subject of counter-claim, which is a new objection, but because they say the defendant has no right to such relief, and he has not properly referred to the facts. Now, I did not decide, in Holloway v. York, that a counter-claim should do any more than state the facts properly on which the counterclaim was founded. I did not decide that they were to be stated all over again. A defendant bringing a counter-claim may say I rely on the facts stated in the 3rd, 4th, and 5th paragraphs of the statement of claim, and the 7th, 9th, and 11th paragraphs of the statement of defence.' He need not print them all over again; it is quite enough if he refers to them, and bases his counter-claim on the facts therein stated. That is what the defendant has done. He refers to the indenture of the 26th of June, 1876, 'in the pleadings mentioned,' and to certain paragraphs in the statement of defence, which is a very good and cheap way of stating his case, much better than setting it all out again; and then he counter-claims in the alternative for what he certainly would have been entitled to if he had not got judgment in the common law action, namely, for the money due to him under the indenture. That alternative would be the subject of demurrer, rather than of a motion to strike it out; but I think, looking at what has occurred, the right order to make is to strike out the counterclaim, and to make the costs costs in the action." See also Lees v. Patterson (7 Ch. D. 866; 47 L. J. Ch. 616; 38 L. T. 451; 26 W. R. 399).

It may be taken now as well settled that when the facts which support the counter-claim have already appeared in the defence, the proper course is for the defendant to incorporate them in the counter-claim by some general words, such as "the defendant repeats the allegations contained in paragraphs . . . . of the defence;" or "the defendant refers to the allegations in paragraphs. . . . of the defence." When the facts on which the defendant relies do not appear in the defence, as will generally be the case, he must then state them in the body of the counter-claim, with such particularity as may be necessary, but bearing in mind the rules against prolixity. A counter-claim is a statement of claim in a

cross action; and all the principles which have been laid down with regard to pleading facts in a statement of claim apply to the counter-claim.

SECTION IV.-REPLY.

The substance and form of the plaintiff's reply vary with the nature and form of the defence, and will differ accordingly as (1st) The defendant in his defence has merely denied the allegations in the claim, or set out new facts which the plaintiff in his turn merely wishes to deny; or (2nd) the defendant having set out new facts in his defence, the plaintiff wishes to set out new facts in answer; or (3rd) where the defendant has pleaded a counter-claim.

defence.

1. In the cases which fall within the first of these three Reply classes, the plaintiff's course is very simple. In his reply he where plaintiff merely joins issue on the defence, or availing himself of merely Order XXVII., r. 13, he delivers no further pleading. In that denies case, "if the plaintiff does not deliver a reply, or any party does not deliver any subsequent pleading within the period allowed for that purpose, the pleadings shall be deemed to be closed at the expiration of that period, and all the material statements of fact in the pleading last delivered shall be deemed to have been denied and put in issue." Having told his own story once, the plaintiff is not bound to deal with each allegation in the defence, and it makes no difference that the defendant has introduced new facts into the case. The plaintiff need not deal specifically with them, but by a general joinder of issue he puts the defendant to proof of them. Rule 18 of Order XIX. expressly confers upon a plaintiff this right. It says: "Subject to the last preceding rule (which refers to the case of a counter-claim, to be presently dealt with), the plaintiff by his reply may join issue upon the defence, and each party in his pleading (if any), subsequent to reply, may join issue upon the previous pleading. Such joinder of issue shall operate as a denial of every materia allegation of fact in the pleading upon which issue is joined, but it may except any facts which the party may be willing to admit, and shall then operate as a denial of the facts not so admitted."

Reply where plaintiff

desires to

plead new facts.

Reply to

counterclaim.

See also Order XXVII., r. 13, already quoted; and Williamson v. The London and North Western Railway Company, 12 Ch. D. 787; 48 L. J. Ch. 559; 27 W. R. 724.

2. But where the defence is more than a mere denial of the statement of claim, and contains new facts, the plaintiff is entitled by his reply to specifically allege fresh facts in answer to them, provided that the fresh facts which he pleads are not inconsistent with those contained in the statement of claim. A plaintiff by his reply must not set up a new case or new claims. That can only be done, if at all, by amendment of the statement of claim. But, as we have already seen, in his claim he is not bound to anticipate the defence, and to allege facts to meet allegations which the defendant may make. (Hall v. Eve, quoted at pp. 46-49.) He can lie by until the defendant has pleaded his facts, and then suggest any new matter which affords an answer to them, provided always that it is not inconsistent with the case he made originally by his statement of claim. For instance, a plaintiff sues for damages caused by the personal negligence of the defendant. He has every reason to believe that the defendant will plead a release which he obtained by fraud. It would not be proper for the plaintiff in his statement of claim to allege that the defendant obtained a release from him by fraudulent misrepresentation. That would be anticipating a defence which possibly may not be set up. The proper course is for the plaintiff to briefly state his ground of action against the defendant, and when the latter in his defence pleads the release, to reply specially the fraud, which he contends invalidates it. In setting out the new facts on which he relies, the plaintiff must conform to the rules against prolixity, and must state them in as compendious a form as possible. (Williamson v. The London and North Western Railway Company, quoted supra.)

3. The third case is where a defendant has pleaded a counterclaim against the plaintiff. It was decided upon the Rules of 1875 that where a defendant filed a counter-claim, the reply could not join issue upon it generally, but must deal specifically with each material allegation. (Benbow v. Low, 13 Ch. D. 553; 49 L. J. Ch. 553 ; 42 L. T. 14; Green v. Sevin, 13 Ch. D. 589; 41 L. T. 724.) And now, by Order XXIII., r. 4, "where a counter-claim is pleaded, a reply thereto shall be

claim.

subject to the rules applicable to statements of defence." All Reply to the rules laid down in the last section as to framing defences counterapply therefore to a reply which is an answer to a counterclaim. So far as the reply is an answer to the defence merely, it will join issue, or plead new facts, or do both according to the principles stated in this section; and so far as it is an answer to the counter-claim, it will follow the rules applicable to pleading defences. In Hillman v. Mayhew (24 W. R. 485), Jessel, M. R., decided that where a defendant does not plead facts in support of his counter-claim, the plaintiff may join issue upon it generally. The effect of this is only that where a counter-claim is not properly pleaded, you need not properly deny it.

party.

But, in addition to a reply by a plaintiff, there may be a Reply by reply by a third party, who has been brought into the action a third by the counter-claim of the defendant. It seems clear that this reply must be more than a joinder of issue. As between himself and the defendant who brings him into the action the defence and counter-claim of the latter must be regarded as a statement of claim, and, though his answer is called a reply, it is, in effect, a defence, and must conform to the rules which regulate defences.

SECTION V.-JOINDER OF ISSUE.

beyond

"No pleading subsequent to reply other than a joinder of issue shall be pleaded without the leave of the Court or a judge, and then shall be pleaded only upon such terms as the Court or judge shall think fit." (Order XXIII., r. 2.) Where there is Where a no counter-claim, and the plaintiff does not wish to set up any pleading new facts, the reply is, properly, only a joinder of issue, or it reply would seem the party may take advantage of Order XXVII., necessary. r. 13, and deliver no pleading at all. But, where there is a counter-claim, the allegations in which must necessarily be specifically dealt with, or where the plaintiff wishes to set up new facts, the reply is more than a joinder of issue, and in that case a further pleading is necessary. Such further pleading must only be a joinder of issue, unless leave has been obtained to plead anything in addition. The cases will be rare where it