Argo International Pty Ltd v ECQAS Pty Ltd
[2014] QCAT 184
•9 May 2014
| CITATION: | ARGO International Pty Ltd v ECQAS Pty Ltd & Ors [2014] QCAT 184 |
| PARTIES: | ARGO International Pty Ltd (Applicant) |
| v | |
| ECQAS Pty Ltd (First Respondent) Graham Douglas Favell (Second Respondent) Scott Martell Robinson (Third Respondent) |
| APPLICATION NUMBER: | MCD57/14 |
| MATTER TYPE: | Other minor civil dispute matters |
| HEARING DATE: | 24 February 2014 |
| HEARD AT: | Southport |
| DECISION OF: | Adjudicator Trueman |
| DELIVERED ON: | 9 May 2014 |
| DELIVERED AT: | Southport |
ORDERS MADE: | 1. The respondents pay to the Applicant the sum of $2,932.20 within seven days. |
| CATCHWORDS : | Minor civil debt – alleged fraudulent share transaction – seeking refund of monies paid – whether share transfer and sale was a sham – whether misleading and deceptive conduct – where Respondent filed a Response but did not appear Queensland Civil and Administrative Tribunal Act 2009 |
APPEARANCES and REPRESENTATION (if any):
| APPLICANT: | Mr Peter Rohan & Mrs Colleen Rohan (Directors) |
| RESPONDENT: | No appearance |
REASONS FOR DECISION
Mr and Mrs Rohan are Directors of the company ARGO International. In a series of unfortunate events Mr and Mrs Rohan were induced to purchase shares in the company of ECQAS Pty Ltd, (ACN 156 045 788) a company that has as its Directors Mr Favell and Mr Robinson. Mr and Mrs Rohan allege that Mr Favell and Mr Robinson advised them that the ‘company owned valuable intellectual property and a world patented invention’.
Mr Rohan said he was offered the option to purchase 2,000,000 shares at a cost of one cent and he paid $2,000.00 to them and costs of the purchase of $734.00.
Mr Rohan provided evidence of the payment from his Heritage Bank account to ECQAS and the deposit of $2,734.00 made on 24 April 2012.
Mr and Mrs Rohan seek orders that the respondents reimburse the sum of $2,734.00 plus costs. They filed this claim and others relating to the same parties, in Coolangatta on 28 October 2013. The respondents requested that all matters be transferred to Southport as the respondents claimed that the Southport courthouse was better suited to Mr Robinson who is confined to a wheel chair. The other claims, numbers 58/14 and 59/14 were all heard at Southport on 24 February 2014.
Mr Rohan said he later discovered a tangled web of lies and deceit by Mr Favell and Mr Robinson and that he has not received any shares in the company and that he seeks to be reimbursed the money he paid to the Directors and ECQAS.
Mr Favell and Mr Robinson have had involvement in the proceedings. In so far as they requested a transfer of the matters from Coolangatta to Southport. They have sought adjournments and requests to appear by telephone due to alleged overseas travel.
Mr Favell filed a response on 12 November 2013. Mr Robinson did not file any response at all.
Mr Favell seeks orders that the claim be dismissed as he states that neither he or Mr Robinson or ECQAS Pty Ltd sold shares to Argo International.
Mr Favell claims in his defence that the monies received from ARGO International as paid directly to ECQAS Pty Ltd and they were paid as ‘administration costs to administrate the transaction between the Adaline Trust and Argo International Pty Ltd’.
Mr Favell also alleges in his defence that the shares were obtained by Argo International and ‘were transferred from the Adaline Trust as per ASIC records’. Mr Favell did not attach any evidence to his response to the claim to support his allegations.
EVIDENCE
Mr Rohan stated that his company had invested $100,000.00 in a company called Edwards Information Broadcast Pty Ltd (“Edwards”) which purported to hold a worldwide patented invention for cell broadcast by mobile phone.
Mr Rohan said he received a telephone call on 14 April 2012 from Mr Favell advising him and his wife that he had information regarding Edwards. He said he later met with Mr Favell and Mr Robinson who advised him and his wife that they had formed a new company called ECQAS Pty Ltd in partnership with Edwards. He said that Mr Favell and Mr Robinson alleged that ECQAS had purchased the licence of the worldwide patent, owned by Edwards and that ARGO had not been moved across with the other shareholders. Mr Rohan said he was surprised by that information.
Mr Rohan said Mr Favell and Mr Robinson invited him to purchase shares in ECQAS for a total sum of $2,734.00 and that would ‘protect our original investment in EDWARDS’.
Mr Rohan said he arranged for the transfer of the money from his company ARGO to ECQAS and paid those funds. He said he also offered to assist Mr Robinson and Mr Favell with their business and worked in their printing and security System Company called Vubonic Pty Ltd.
Mr Rohan said that the owner of EDWARDS contacted him and confirmed that the agreement between ECQAS and EDWARDS regarding the licence for the patent was ‘worthless: and ECQAS did not own anything’ he said he realised he had been conned.
Mr Rohan provided evidence to the tribunal of ASIC business search for the Company ECQAS Pty Ltd. He said that the ASIC records are inaccurate and that Mr Robinson and Mr Favell have given false information to ASIC regarding their business dealings. He said that the address for the principal place of business is fake and that the business does not operate from the address provided as it is actually a ‘MBE postal address and not a physical address’.
Mr Rohan stated that Mr Favell has also recorded incorrect or misleading information in his other company searches by spelling his name as Graham Farell instead of Favell, and that he has provided an address for him as Director in Acacia Avenue in Robina that does not exist.
Mr Rohan said that he served the claims on Mr Favell and Mr Robinson and the Company and that they filed a response.
Mr Rohan claims that as he was misled into purchasing shares that were worthless in a worthless company that has no assets, he should be reimbursed the funds he paid.
THE LAW
Schedule 3 of the QCAT Act describes a minor civil debt, amongst other things, as ‘a claim to recover a debt or liquidated demand of money, with or without interest, of up to the prescribed amount ($25,000.00)’.
A debt or liquidated demand has been described as a sum of money that can be calculated by reference to a formula schedule or some other yardstick by which the debt or sum payable can be readily calculated.
FINDINGS
This is a minor civil debt matter as I find that the amount claimed by Mr Rohan is a liquidated claim for the refund of monies paid by him to ECQAS Pty Ltd after being induced with misleading and deceptive information given to him by Mr Favell and Mr Robinson.
I find that Mr Rohan has been conned in a web of lies and deceptive stories told to him by Mr Favell and Mr Robinson and that he was conned with promises of returns from a company that had no possibility of deliver such returns.
The trail of dealings on the court file seem to suggest that Mr Robinson and Mr Favell have done every thing they could to delay this matter being heard, from requesting a transfer from one registry to another, for requesting an adjournment without any evidence to support their request, (although granted) and filed a response seeking the claim be dismissed and then failed to appear at the hearing.
I am satisfied that both Mr Favell and Mr Robinson were sent Notices of hearing to attend the tribunal hearing as the address is the same one where they were served and consequently filed a response and corresponded with the registry regarding other interlocutory matters. That being said, I find that I am satisfied of service and I find that it is fair and equitable that the matter be heard and determined on an ex parte basis.
I have taken into account the evidence of the Mr and Mrs Rohan, the content of the evidence and exhibits provided to the tribunal, and I am satisfied an order should be made in favour of the applicant company.
As an aside I note that the evidence of the ASIC business search suggests that there were other investors who were involved in the ECQAS Pty Ltd Company investment, ranging in investors in various areas of Queensland including Nerang and Marcoola who may, like Mr Rohan, have been conned into investing into a company that is a sham, a company that has little value and no assets and unlikely possibility of any return on investment. This case may serves as a warning to naïve investors that they should obtain proper advice before investing in a company that they know little about and trusting Directors of so called companies, who have nothing to loose, and more to gain, by telling investors merely what they want to hear.
I note that although the Applicant company has been successful in their claim, I find from the evidence provided, they may have little likelihood of actually recovering the awarded funds from the respondents in this case.
I order as follows:
ORDER
1. THAT the Respondents must pay to the Applicant the sum of $2932.20 within seven days.
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