If Fred has said X in his defence, then you are entitled to proceed on the basis that he means X. If he wishes to change that defence, he will have to seek permission of the court to amend his defence. You will be entitled to explain the consequences (including cost consequences) for you. If (big if) the Court allows an amendment, it may do so on condition that certain terms are met - these may be adjournment, payment of costs etc.
These things may not simply be sprung by one party on the other.
Isn't Fred the director of his company. If he is present, then, in practice, so is the company.