Fisher J:

In this case I have somewhat regretfully come to the conclusion that the appeal must succeed for I find it impossible to hold that there is not a plausible dispute as to what the plaintiff is entitled to recover, or that there is not a triable issue to go before the Court, or that it would be possible to say, without going into the merits, that it is impossible that there should be a defence.

The cases cited seem to leave no doubt that for the purposes of Order XIV it is not permissible to go into the merits, except possibly as far as in certain cases to enable the Court to say positively that no defence is possible and also to make it clear that if there is a triable issue and a plausible dispute, and no impossibility of a defence the defendant is entitled to unconditional leave to defend. The regret I feel arises from the impression I cannot but gather from the learned Chief Justice's words that the proposed defence and counterclaim savoured of unsubstantiality and lack of ground, and that he therefore did not think it right to interfere with the Registrar's discretion in putting defendant on conditions. I think, however, that in the cases, that is not enough, and defendant must have leave to defend unconditionally.

The Appeal therefore succeeds, and the order will be that defendant should have unconditional leave to defend, and his costs of the appeal and of the hearing below.

JUDGMENT

Ebden J:

I differ from what I understand to be the view of the rest of the Court in that I do not think that the Judgment under Appeal should be disturbed. Counsel for Appellant who has put his case before us very clearly has pointed out, that the principle on which the Court acts, is that where Defendant can shew by affidavit that there is a bona fide triable issue he should be allowed to defend that issue unconditionally and that when once a reasonable ground of defence is shewn there is no power to go into the merits in considering leave to defend. Also that leave should be given when there is reasonable ground for enquiry on an account in order to ascertain the amount recoverable. But the defendant's affidavits must condescend upon particulars which must be sufficient to show a bona fide defence.

The Defendant in his affidavit complained the Plaintiff had rendered him no accounts of rents and income of the property from 5 January 1910 onward. But Plaintiff went into possession only in April 1911, the property having been till then in the hands of Messrs Powell & Co. the receivers appointed by the Court. If Defendant had anything to say about the accounts up to that date he should have called on the Receivers to vouch. When Plaintiff went into possession he continued the services of Messrs Powell & Co. as his agents to receive the rents and profits so that the accounts were kept by the same hand throughout on 25 November 1911 Plaintiff filed two sets of accounts one for the period of the Receivership for which he was not answerable and one for the seven months, April to October 1911, inclusive the period during which he had been in possession. Time was given to 8 December 1911 for Defendant to go into the account and on that day the Registrar made his order. If Defendant had any fault to find with the account he could have filed a further affidavit but he did not do so.

Moreover a counterclaim is not a defence though it may be of the nature of one and if Defendant was in earnest he might quite well have brought an action for accounts and have asked that the two suits should be consolidated.

It seems to me therefore as it did to the learned Chief Justice that the Registrar had probably or I might say presumably and with reason, come to the conclusion that the proposed counterclaim was unsubstantial and groundless or in other words that there was good ground for believing that the defence was a sham defence and that he was "prepared very nearly to give judgment for the Plaintiff" (Annual Practice 1912, vol 1, p. 1