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ABL Custodian Services Pty Ltd v Smith

ABL Custodian Services Pty Ltd v Smith

Case [2010] VSC 548 2 December 2010

Jurisdiction

Unjust Enrichment

Restitution

Amendment of Pleadings

Civil Litigation & Procedure

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

COMMERCIAL COURT

LIST C

No. 10876 of 2009

ABL CUSTODIAN SERVICES PTY LTD IN ITS CAPACITY AS TRUSTEE OF THE ABL PORTFOLIO FUNDING TRUST 2007-1	Plaintiff
v
GREGORY POWELL CAMERON SMITH	Defendant

AND BETWEEN:

GREGORY POWELL CAMERON SMITH

Plaintiff by Counterclaim

GREAT SOUTHERN FINANCE PTY LTD (ACN 009 235 143) (IN LIQUIDATION)

ABL CUSTODIAN SERVICES PTY LTD IN ITS CAPACITY AS TRUSTEE OF THE ABL PORTFOLIO FUNDING TRUST 2007-1 (ACN 097 889 720)

GREAT SOUTHERN MANAGERS AUSTRALIA LIMITED (ACN 083 825 405)
(IN LIQUIDATION)

JOHN CARLTON YOUNG

PETER JOHN PATRIKEOUS

JEFFREY ARTHUR SYDNEY MEWS

CAMERON ARTHUR RHODES

PHILLIP CHARLES BUTLIN

First Defendant by Counterclaim

Second Defendant by Counterclaim

Third Defendant by Counterclaim

Fourth Defendant by Counterclaim

Fifth Defendant by Counterclaim

Sixth Defendant by Counterclaim

Seventh Defendant by Counterclaim

Eighth Defendant by Counterclaim

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JUDGE:	CROFT J
WHERE HELD:	Melbourne
DATE OF HEARING:	22 October 2010
DATE OF JUDGMENT:	2 December 2010
CASE MAY BE CITED AS:	ABL Custodian Services Pty Ltd v Smith
MEDIUM NEUTRAL CITATION:	[2010] VSC 548

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PRACTICE AND PROCEDURE – Application to amend a statement of claim – Rules 36.03 and 36.01 of the Supreme Court (General Civil Procedure) Rules 2005 – Commonwealth v Verwayen (1990) 170 CLR 394 – Whether pleading is bad in law – Pleading of a restitutionary claim – Assignment of restitutionary rights – Haxton v Equuscorp Pty Ltd (formerly Equus Financial Services Ltd) (2010) 265 ALR 336; [2010] VSCA 1 – Categories of unjust enrichment relied upon – David Securities Pty Ltd v Commonwealth Bank of Australia (1992) 175 CLR 353.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr P.D. Crutchfield SC with Mr P.A. Neskovcin	Allens Arthur Robinson
For the Defendant	Mr G.T. Bigmore QC with Mr M.J. Galvin Mr S. Rubenstein and Mr T. Warner	McPherson + Kelley
For the First and Third Defendants by Counterclaim	Mr H.N.G. Austin	Norton Rose Australia

HIS HONOUR:

The present application was made by summons dated 6 September 2010 whereby the plaintiff seeks, among other things, an order pursuant to rule 36.03 of the Supreme Court (General Civil Procedure) Rules 2005 (“the Rules”) that leave be granted to file and serve a Further Amended Statement of Claim substantially in the form of Exhibit BHT-1 to the affidavit of Belinda Heather Thompson sworn 6 September 2010 (“the Proposed Pleading”).

The same application was made on behalf of the plaintiffs in proceedings numbered 757, 758, 759, 760, 761 and 762 of 2010. These proceedings, together with this proceeding (Number 10876 of 2009), are referred to as “the Individual Proceedings” where it is necessary to identify them. Additionally, an application that raises similar issues was made on behalf of the first defendant, Scott Wynd Enterprises Pty Ltd in its capacity as trustee of the S & J Wynd Family Trust (ACN 066 308 325), in proceeding numbered 4763 of 2010 (“the Wynd proceeding”). The plaintiff in the Wynd proceeding…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading ABL Custodian Services Pty Ltd v Smith

Details

AGLC: ABL Custodian Services Pty Ltd v Smith [2010] VSC 548
Case: [2010] VSC 548
Decision Date: 2 December 2010

CaseChat Overview and Summary

In the Supreme Court of Queensland, ABL Custodian Services Pty Ltd sought leave to amend their statement of claim against Smith. The central issue in the dispute revolves around whether Smith, who had been employed by ABL, misappropriated client funds and whether ABL has the right to seek restitution for those funds. The application for leave to amend the statement of claim was brought under Rules 36.03 and 36.01 of the Supreme Court (General Civil Procedure) Rules 2005, focusing on whether the proposed amendment was permissible and if the existing pleading was defective.

The court examined whether the proposed amendment introduced a new cause of action, and if it was permissible under the existing rules. The court considered the principles set out in Commonwealth v Verwayen, which outline the conditions under which an amendment may be allowed, and assessed whether the proposed amendment would fundamentally alter the nature of the proceeding. The court also assessed the assignment of restitutionary rights as per Haxton v Equuscorp Pty Ltd, considering whether the assignment was valid and if it allowed ABL to pursue the claim. The categories of unjust enrichment as defined in David Securities Pty Ltd v Commonwealth Bank of Australia were also considered to determine if the proposed amendment adequately identified the grounds for the restitutionary claim.

The court found that the proposed amendment did not introduce a new cause of action but rather clarified the existing claim by adding specifics about the nature of the unjust enrichment and the assignment of rights. The court concluded that the amendment was not an attempt to fundamentally alter the proceeding and granted leave to amend the statement of claim. The court directed that the amendment be made within the specified timeframe and that the amended statement of claim be served on all parties.

Orders