YAF Master v S&P Global, Inc (Applications for Leave)

YAF Master v S&P Global, Inc (Applications for Leave) [2025] FCA 333 is a Federal Court practice and procedure decision in a very large commercial case. The underlying proceedings concern ratings issued by S&P for structured finance products before the Global Financial Crisis, including collateral CDOs backed by residential mortgage-backed securities and a substantial proportion of subprime RMBS. The judgment says the ratings in issue were generated using S&P's LEVELS model, and that deceit is a central cause of action. It also records that the proceedings involve allegations of fraud against S&P.

But this judgment was not the final trial. The immediate issue was much narrower and very practical. The applicants wanted leave to amend parts of their amended statement of claim and to rely on further evidence shortly before a concurrent eight-week final hearing due to start on 30 June 2025. The application was filed on 1 April 2025, after a long period of case management and after earlier disputes about admissibility of evidence.

The timing mattered. The proceedings had been listed for final hearing in December 2023. There had already been orders about lay evidence, expert evidence and further particulars. In that setting, the Court had to decide whether the applicants should be allowed to reshape parts of their case and add further material so close to trial.

The judgment gives a useful procedural history. The Basis proceedings were commenced in February 2021. From the outset, the applicants pleaded a reliance and causation case built around their investment strategy, the role of Mr Stuart Fowler in investment decisions, and the way they said they relied on S&P's ratings. They also pleaded a counterfactual "no investment" case, alleging they would not have invested in the claim CDOs if they had known the ratings were not reliable, independent or based on reasonable grounds. In addition, they pleaded an "alternative investments" loss case, saying they lost the opportunity to invest the same sums in other interest-bearing investments.

That background became important because one of the recurring questions in the application was whether the proposed changes were truly new, or whether they were refinements of a case already on foot. The Court noted that the applicants had, from the commencement of the proceedings, been propounding a no investment case and an alternative investments case.

The judgment also refers to Mr Fowler's affidavit dated 23 November 2021. On the available text, he said that if he had known S&P was not independent, or that business considerations affected the ratings process, he could not and would not have relied on the ratings. He also said that if he had known all CDO ratings during the relevant period were affected by those issues, he would have stopped investing in CDOs until satisfied the issues were resolved, and would instead have pursued alternative investment opportunities or reallocated capital into other products such as CLOs, high yield bonds, convertible securities or hybrid securities.

Later, in July 2023, Lee J granted leave to amend pleadings despite objections from S&P that the amendments gave rise to a substantially different case. Other case management orders followed, including orders for consolidated particulars and additional outlines of lay evidence. The matter was listed for final hearing in late June 2025. The applicants did not file additional outlines of lay evidence by the extended date. Expert evidence was then served late in 2024, including technical reports and a loss report.

In February 2025, the Court heard S&P's application under s 192A of the Evidence Act. In the later reasons now under discussion, Shariff J explained that one reason for dismissing that earlier application was that the Court was not in a position to resolve substantial controversies about pleading points at that stage. The judge then alerted the applicants that, if they wished to seek further amendments or rely on further evidence in light of those pleading disputes, they would need either consent or leave. That set up the present application.

Not every proposed change was contested. S&P opposed some parts of the application and accepted or did not oppose others. The judgment identifies the disputed matters as whether the applicants should be granted leave to amend particulars at [341] of the amended statement of claim, amend [349.5]-[349.6], amend particulars at [422]-[425], and rely on the Fowler outline and the Woo affidavit.

The proposed amendment at [341] arose from a criticism S&P had made during the earlier admissibility application about parts of an expert report by Dr Youngblood. S&P said some opinions in that report were not relevant to the pleaded case. The applicants did not accept that criticism, but sought to amend the particulars at [341] to put the matter beyond doubt and ensure procedural fairness. S&P opposed that step, arguing the proposed particulars went beyond the factual premises already pleaded.

The proposed amendments at [349] were different. They concerned an Excel spreadsheet referred to in the pleadings as the November 2006 Subprime Trouble Spreadsheet. Existing allegations at [349.1] to [349.4] already asserted what the applicants said was demonstrated by data in that spreadsheet. The proposed additions at [349.5] to [349.8] sought to add further assertions said to be demonstrated by the same data. The judgment records that there was no dispute that these additional allegations were drawn from Dr Youngblood's first report.

S&P's position was that these allegations were new and would require substantial additional work to answer, including factual enquiries and consultation with lay and expert witnesses about events more than 20 years old. S&P relied on solicitor evidence saying that the work would be significant because the case involved a large body of technical documents and historical events requiring reconstruction.

The applicants responded that S&P had known of the specific allegations since service of Dr Youngblood's report in December 2024. S&P accepted it had known of them, but said it had consistently objected on the basis that they were outside the pleaded case and that it had no obligation to respond to irrelevant matters. S&P also argued there was no proper explanation for the delay in seeking the amendments.

The legal issue was whether the Court should grant leave for late pleading amendments and late evidence in complex litigation already set down for a lengthy final hearing. The judgment makes clear that amendments at this stage are not available as of right, even if a new claim is arguable. The Court applied the principles from Aon and related authorities, together with the overarching purpose in ss 37M and 37N of the Federal Court of Australia Act 1976 (Cth).

The judgment summarises the relevant considerations in a practical way. They include the nature and importance of the amendment, the extent of delay and associated costs, the prejudice that may be assumed or shown, the explanation for delay, the parties' earlier choices in the litigation, the detriment to other litigants, and the risk of loss of public confidence if courts too readily accept late applications without adequate justification. The Court also accepted that the same considerations, especially the imperatives of ss 37M and 37N, were relevant to whether a party should be permitted to rely on late-served evidence.

S&P also argued that delay itself may make amendment inappropriate, and that there can be presumptive prejudice where delay is likely to have caused deterioration in recollection and ability to give evidence. That point had particular force here because the events in issue were said to have occurred around 20 years earlier and the proceedings involved allegations of fraud. Shariff J accepted that those considerations were relevant to the exercise of discretion.

For business readers, this part of the judgment is the core lesson. Courts do not look only at whether a proposed amendment might help identify the true controversy. They also look at timing, fairness, cost, disruption, and whether the party seeking the change has properly explained why it was not raised earlier.

On the available text, Shariff J allowed the application only in limited respects. The judge said leave should be granted to amend the amended statement of claim at [349.5]-[349.6]. The judge also said leave should be granted for the applicants to rely on the Fowler outline and to amend particulars at [422]-[425] so they could refer to that outline, subject to a condition that the applicants produce relevant documents requested by S&P within a short period of about seven days. Otherwise, leave was refused for the balance of the disputed matters.

The judgment gives a clear example of the Court's reasoning on the proposed amendment to particulars at [341]. Shariff J was not persuaded to grant leave. The reason was not simply lateness. The judge considered that, even if the particulars were amended, the real dispute would remain. There would still be an argument at trial about whether parts of Dr Youngblood's opinions fell within the parameters of the existing pleaded case and the factual premises already pleaded. In other words, the amendment would not usefully resolve the controversy. The parties already knew each other's positions, and the Court would still have to decide the scope of the pleaded case at trial.

The Court took a different view about the proposed amendments at [349]. Although there had been no explanation for the delay, the judge said it could readily be inferred that the amendments arose because Dr Youngblood, in analysing the November 2006 Subprime Trouble Spreadsheet, identified additional matters that in his opinion were demonstrated by the data. The Court carefully examined S&P's evidence of prejudice, but noted that the solicitor evidence addressed prejudice across several proposed amendments together and did not distinguish the specific prejudice said to arise from the amendments at [349.5]-[349.8]. On the available text, that lack of specificity mattered to the Court's assessment.

The available text cuts off before the full reasoning is reproduced, so the complete treatment of every disputed item is not visible here. Even so, the extract clearly supports the overall conclusion that the Court adopted a selective approach: it permitted some targeted changes and evidence, but refused the broader balance of the application.

Most businesses will never be involved in a Federal Court dispute about pre-GFC structured finance products. But the procedural lesson is highly transferable. If your company is in litigation, your pleadings, witness evidence and expert evidence need to line up early. Courts expect parties to identify their real case in time for the other side to respond properly. They are much less sympathetic when a party tries to sharpen, expand or repair its case close to trial.

This is especially important in disputes involving old events, technical systems, allegations of dishonesty, or large document sets. In those cases, a late amendment can force the other side to revisit years of material, locate or re-brief witnesses, and ask experts to deal with new factual propositions. That is exactly the kind of prejudice and disruption courts take seriously.

The decision also shows that not every late amendment will fail. A targeted amendment tied to material already in play may still be allowed, particularly if the prejudice evidence is too general or does not clearly isolate the burden caused by that specific amendment. But that is not something a business should rely on. The safer course is to treat pleadings as a controlled project, not a rolling draft.

If you are running litigation, practical discipline matters. Keep a clear chronology. Map each pleaded allegation to documents and witnesses. Check whether expert reports go beyond the current pleadings. If they do, decide quickly whether the pleading should be amended. And if a new issue emerges after an evidentiary dispute, do not assume the court will let you fix it later without consequence.

The judgment is dated 9 April 2025. It records that the interlocutory application was filed on 1 April 2025 and heard on 4 April 2025. The concurrent final hearing in the Basis and Vale proceedings was due to commence on 30 June 2025 and run for eight weeks. The orders section reproduced in the available text directs the parties to provide consent or competing short minutes of order by 5 pm on 11 April 2025 reflecting the reasons.

Because the available text is incomplete, this page should be updated if the full judgment or entered orders reveal further detail about the final form of the orders or later procedural developments.

This page is based on the Federal Court decision YAF Master v S&P Global, Inc (Applications for Leave) [2025] FCA 333, delivered by Shariff J on 9 April 2025. The available text confirms the case was a practice and procedure ruling on applications to amend pleadings and rely on further evidence in complex litigation listed for an eight-week final hearing.

The available text is truncated. It provides enough material to explain the procedural setting, the governing principles, and the limited outcome recorded by the Court, but not enough to reproduce every aspect of the reasoning in full. Readers should check the complete judgment and any entered orders for the exact final position.