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AIIB Pty Ltd v Beard

AIIB Pty Ltd v Beard

Case [2009] NSWSC 1001 24 September 2009

Contract Formation

Breach of Contract

Obligations of Confidence

Breach of Confidence

Contract Law

Equity

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CITATION: AIIB Pty Limited v Beard [2009] NSWSC 1001

HEARING DATE(S): 4, 5, 6 and 11 February and 16 July 2009

JUDGMENT DATE :
24 September 2009

JURISDICTION: Equity

JUDGMENT OF: Ward J

DECISION: As against first defendant, plaintiff to elect between account of profits and equitable compensation to be assessed on enquiry.
As against second defendant, enquiry as to damages ordered.
Claim dismissed against third defendant.
On cross-claim, first and second defendant ordered to indemnify third defendant.

CATCHWORDS: CONTRACTS - general contractual principles - offer and acceptance - whether contracts formed between plaintiff and first or second defendant - whether breach of confidentiality or non-solicitation provisions of contracts - held that contract formed between plaintiff and second defendant - held that second defendant had breached confidentiality and non-solicitation provisions of contract - EQUITY - general principles - obligations of confidence - whether first or second defendant owed equitable obligation of confidence to plaintiff - whether breach of obligation of confidence - whether third defendant liable as principal of first or second defendant or otherwise - held that first defendant owed and breached equitable obligation to plaintiff - held that third defendant not liable as principal as relevant acts outside scope of agency and s 917B Corporations Act inapplicable

LEGISLATION CITED: Corporations Act 2001
Uniform Civil Procedure Rules

CATEGORY: Principal judgment

CASES CITED: Blackburn, Low & Co v Vigors (1887) 12 App Cas 531
Coco v AN Clark (Engineers) Limited [1969] RFC 41
Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434
Deta Nominees Pty Limited v Viscount Plastic Products Pty Limited [1979] VR 167
El Ajou v Dollar Land Holdings Plc [1994] 2 All ER 685
Expectation Pty Limited v PRD Realty Pty Limited (2004) 140 FCR 17
Faccenda Chicken Limited v Fowler [1987] Ch 117
Film Bars Pty Limited v Pacific Film Laboratories Pty Limited (1979) 1 BPR 9251
Freeman & Lockyer (a firm) v Buckhurst Park Properties (Mangal) Limited [1964] 2 QB 480
Gurr v Robinson (unreported, 10 February 1986)
Hadid v Redpath (2001) 35 MVR 152
Halliday & Nicholas Insurance Brokers Pty Limited v Corsiatto [2001] NSWCA 188
In re Robinson’s Settlement: Gant v Hobbs [1912] 1 Ch 717
Laws Holdings Pty Limited v Short (1972) 46 ALJR 563
Mid-City Skin Cancer and Laser Centre Pty Limited v Zahedi-Anarak (2006) 67 NSWLR 569
Monie v Commonwealth of Australia (2005) 63 NSWLR 729
NAIS v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 228 CLR 470
Peter Pan Manufacturing Corp v Corsets Silhouette Limited [1964] 1 WLR 96
Pitcher v Langford (1991) 23 NSWLR 142
Robb v Green [1895] 2 QB 1
Sasson v Fahevu [1999] NSWCA 400
Southern Real Estate v Dellow (2003) 87 SASR 1
Talbot v General TV Corp Pty Limited [1980] VR 224
Vokes v Heather (1945) 62 RPC 135
Warman International Limited v Dwyer (1995) 182 CLR 574

TEXTS CITED: Meagher Gummow & Lehane's Equity Doctrines and Remedies

PARTIES: AIIB Pty Limited (Plaintiff)
Peter Beard (First…

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 AIIB Pty Ltd v Beard

Details

AGLC: AIIB Pty Limited v Beard [2009] NSWSC 1001
Case: [2009] NSWSC 1001
Decision Date: 24 September 2009

CaseChat Overview and Summary

AIIB Pty Ltd brought an action against Beard and two other defendants in the Federal Court of Australia, seeking damages for breaches of contract and equity. The plaintiff, AIIB, alleged that Beard, the first defendant, and his company, the second defendant, had breached contractual and equitable obligations of confidentiality and non-solicitation. The plaintiff claimed that Beard, having been employed by AIIB, subsequently engaged in activities that were in breach of the agreements he had entered into with AIIB. AIIB further alleged that the third defendant, a company, was liable as the principal of the first and second defendants, or otherwise.

The court was required to determine whether contracts had been formed between AIIB and Beard or between AIIB and the second defendant, and whether Beard or the second defendant had breached the confidentiality and non-solicitation provisions of those contracts. The court also had to decide whether Beard or the second defendant owed an equitable obligation of confidence to AIIB, and whether that obligation had been breached. Finally, the court had to determine whether the third defendant was liable as the principal of the first or second defendant or otherwise.

The court held that a contract had been formed between AIIB and the second defendant, and that Beard had breached the confidentiality and non-solicitation provisions of that contract. The court found that Beard, as an individual, owed an equitable obligation of confidence to AIIB, which he had breached. The court held that the third defendant was not liable as the principal of the first or second defendant, as the relevant acts were outside the scope of the agency and section 917B of the Corporations Act was inapplicable.

The court awarded damages to AIIB against the first and second defendants for breach of contract and equity, and dismissed the claim against the third defendant. The precise amount of damages was to be determined at a later date.

Orders