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Balanced Securities v Thomas

Balanced Securities v Thomas

Case [2010] QDC 337 3 September 2010

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DISTRICT COURT OF QUEENSLAND

CITATION:

Balanced Securities v Thomas [2010] QDC 337

PARTIES:

BALANCED SECURITIES LIMITED
(ACN 083 514 685)
(Plaintiff)

v

DAVID LIONEL THOMAS
(Defendant)

FILE NO/S:

1453 of 2010

DIVISION:

Civil jurisdiction

PROCEEDING:

Application for summary judgment

ORIGINATING COURT:

Brisbane

DELIVERED ON:

3 September 2010

DELIVERED AT:

Brisbane

HEARING DATE:

27 August 2010

JUDGE:

Dorney QC, DCJ

ORDERS:

The judgment of the court is that the defendant pay to the plaintiff the amount of $113,515.37.1.

The plaintiff has liberty to apply to seek interest on the judgment sum by 4:00pm on 7 September 2010 and the defendant has liberty to respond by submissions filed by 4:00pm on 10 September 2010.2.

The defendant’s application is dismissed.      3.

The parties have liberty to file submissions with respect to costs by 4pm on 10 September 2010.      4.

CATCHWORDS:

SUMMARY JUDGEMENT – where both plaintiff and defendant seek summary judgement – whether “indemnifier’s exception” applies to guarantee – whether “third party” guarantor (as alter ego of company) bound by decision against company principal, even if exception does not apply – whether guarantee extends to default assessed costs of earlier decision – whether service of costs statement should be ordered anyway as a matter of fairness.

Uniform Civil Procedure Rules 1999 rr 292, 293, 371, 705

420093 BC Ltd v Bank of Montreal (1995) 128 DLR (4^th) 488 (Alberta CA)

Abigroup Ltd v Sandtara Pty Ltd [2002] NSWCA 45

Belton v Carlow County Council (1987) 1 IR 172

Champerslife Pty Ltd v Manojlovski & Anor [2010] NSWCA 33

Chan v Cresdon Pty Ltd (1989) 168 CLR 242

Clambake Pty Ltd v Tipperary Projects Pty Ltd [No 5] [2009] WASC 141

Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337

Darlington Futures Ltd v Dalco Australia Pty Ltd (1986) 161 CLR 500

Deen-Wilcox (as liquidator of SJP Formwork (NSW) Pty Ltd (in liq)) & Anor v Commissioner of Taxation (No 2) (2004) 49 ACSR 325

Duffield v Scott (1789) 3 Term Rep 374

Glenwood Homes Pty Ltd v Eberhard & Ors [2008] QSC 192

Hall v Commissioner of Taxation (2004) 51 ACSR 173

Harris v Commissioner for Taxation [2006] 2 Qd R 445

Jeans v Bruce [2004] NSWSC 539

National Bank of Nigeria Ltd v Awolesi [1964] 1 WLR 1131

National Bank of New Zealand v West [1978] 2 NZLR 451

Neumann Contractors Pty Ltd v Traspunt No 5 Pty Ltd [2010] QCA 119

Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589

Ramsay v Pigram (1968) 118 CLR 271

Re Clark’s Refrigerated Transport [1982] VR 989

Royal Botanic Gardens and Domain Trust v South Sydney City Council (2002) 240 CLR 45

Salomon v Salomon [1897] AC 22

Sunbird Plaza Pty Ltd v Moloney (1988) 166 CLR 245

Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165

Trawl Industries of Australia Pty Ltdv Effem Foods Pty Ltd (1992) 36 FCR 406

COUNSEL:

P. Travis for the…

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 Balanced Securities v Thomas

Details

AGLC: Balanced Securities v Thomas [2010] QDC 337
Case: [2010] QDC 337
Decision Date: 3 September 2010

CaseChat Overview and Summary

Balanced Securities sought summary judgment against Thomas, the guarantor of a debt owed by a company, on the basis of a signed guarantee. Thomas cross-claimed for summary judgment, arguing that he was not liable under the guarantee due to an “indemnifier’s exception” and that he was not bound by a prior decision against the company. The dispute also included whether the guarantee extended to the costs of the earlier decision and whether a costs statement should be served for fairness.

The court considered whether the “indemnifier’s exception” applied to the guarantee and if Thomas, as a guarantor who was also the alter ego of the company, was bound by the earlier decision against the company. Additionally, the court examined whether the guarantee encompassed the assessed costs from the earlier decision and whether a costs statement should be issued to ensure fairness. The court held that the “indemnifier’s exception” did not apply, and Thomas, despite being an alter ego of the company, was not bound by the earlier decision. The guarantee did not extend to the costs of the earlier decision, but the court found it fair to order the service of a costs statement. Consequently, Thomas was ordered to pay the principal amount of the debt, and the court dismissed his application for summary judgment.

The court ordered Thomas to pay the principal sum of $113,515.37 to Balanced Securities. The plaintiff was granted liberty to apply for interest on the judgment sum by a specified deadline, with Thomas permitted to respond. Thomas's application for summary judgment was dismissed. The parties were given liberty to file submissions regarding costs by a set deadline.

The court made final orders that Thomas pay the specified amount to Balanced Securities, allowed for applications regarding interest and costs, and dismissed Thomas's application for summary judgment. The court also provided deadlines for the parties to file submissions on these matters.

Orders

Orders of the court

The judgment of the court is that the defendant pay to the plaintiff the amount of $113,515.37.1.

The plaintiff has liberty to apply to seek interest on the judgment sum by 4:00pm on 7 September 2010 and the defendant has liberty to respond by submissions filed by 4:00pm on 10 September 2010.2.

The defendant’s application is dismissed. 3.

The parties have liberty to file submissions with respect to costs by 4pm on 10 September 2010. 4.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

Citations

AGLC Citation

Balanced Securities v Thomas [2010] QDC 337

Most Recent Citation

Homai Kermani v Westpac Banking Corporation [2010] VSC 556

Cases citing this decision · 1 of 1 shown

Homai Kermani v Westpac Banking Corporation
[2010] VSC 556 Para 1

…. [42] Johnson v Gore Wood & Co (a firm) [2002] 2 AC 1 ; Champerslife Pty Ltd v Manojlovski (2010) 75 NSWLR 245; Balanced Securities Ltd v Thomas [2010] QDC 337.…

View all 1 citing cases →

Cases cited in this decision · 26 of 26 shown

Neumann Contractors Pty Ltd v Traspunt No 5 Pty Ltd
[2010] QCA 119 Para 1

…udgment in such circumstances, I have undertaken the task: see the observations by Muir JA in Neumann Contractors Pty Ltd v Traspunt No 5 Pty Ltd [2010] QCA 119 at [82].…
Champerslife Pty Ltd v Manojlovski
[2010] NSWCA 33 Para 1

…other case but that, since dicta had already been offered, felt compelled to add his own observations: see Champerslife Pty Ltd v Manojlovski & Anor [2010] NSWCA 33 at [102]-[103]. It must also be remarked that what was under consideration was not any issue of indemnifier’s exception but rather what was called th…
Joelco Pty Ltd v Balanced Securities Limited
[2009] QSC 304 Para 1

…tember 2009, it was ordered that indemnity costs, rather than standard basis costs, be paid: see Joelco Pty Ltd v Balanced Securities Limited [2009] QSC 304. Costs were then assessed in the sum of $113, 515.37; and by court order of 6 May 2010 Joelco was ordered to pay the present plaintiff that sum.…
Joelco Pty Ltd v Balanced Securities Limited
[2009] QSC 236 Para 1

…asis, and that liberty be reserved to the parties to make additional submissions in writing: see Joelco Pty Ltd v Balanced Securities Limited [2009] QSC 236. As a result of that liberty, on 23 September 2009, it was ordered that indemnity costs, rather than standard basis costs, be paid: see Joelco Pty Ltd v Bala…
Clambake Pty Ltd v Tipperary Projects Pty Ltd [No 5]
[2009] WASC 141 Para 1

…’s counsel, in his oral argument, relied upon the Western Australian Supreme Court decision of Clambake Pty Ltd v Tipperary Projects Pty Ltd [No 5] [2009] WASC 141. There, EM Heenan J considered the issues of res judicata , issue estoppel, abuse of process and privity of interest. With respect to privity of intere…
Glenwood Homes P/L v Eberhard
[2008] QSC 192 Para 1

…eeding because of the particular circumstances of that proceeding itself. The decision of Dutney J in Glenwood Homes Pty Ltd v Eberhard & Ors [2008] QSC 192 illustrates this point. Dutney J held that the better view seemed to him to be to construe “a party” - there for the purposes of Rule 708(1)(a) - as applying…
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd
[2004] HCA 52 Para 1

…it an interpretation to be adopted by the court which was consistent with both Ankar and Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 (concerning the principle of objectivity by which the rights and liabilities of the parties to a contract are determined).…
Hall v Commissioner of Taxation
[2004] NSWSC 985 Para 1

…at third parties had been denied a right to make submissions at a time a consent order was made [see the reference to Hall v Commissioner of Taxation (2004) 51 ACSR 173]: at 451 [26]. As the following paragraph ([27]) shows, the conclusion was reached because there was “an implicit statutory direction that directors…
Jeans v Bruce
[2004] NSWSC 539 Para 1

…In his usual monumental way, Einstein J in Jeans v Bruce [2004] NSWSC 539 undertook an analysis of what was described as the “indemnifier’s exception” to the general rule that only parties and their privies are bound by a res judicata . Somewhat intriguingly, although it may have been a deliberate choice on his par…
Andar Transport Pty Ltd v Brambles Ltd
[2004] HCA 28 Para 1

…High Court in Ankar Pty Ltd v National Westminster Finance (Australia) Ltd (1987) 162 CLR 549, as confirmed in Andar Transport Pty Ltd v Brambles Ltd (2004) 217 CLR 424, are, at least initially, applicable.…
Dean-Willcocks Pty Ltd v Commissioner of Taxation (No 2)
[2004] NSWSC 286 Para 1

…ings: first, that Austin J in Deen-Wilcox (as liquidator of SJP Formwork (NSW) Pty Ltd (in liq)) & Anor v Commissioner of Taxation (No 2) (2004) 49 ACSR 325 observed that “direct statutory liability was of a kind that would normally provide a basis for the application of the rules of natural justice”; and, secondly,…
Abigroup Ltd v Sandtara Pty Ltd
[2002] NSWCA 45 Para 1

…by the defendant, is “independent of any contractual right to costs”. The proposition itself is undeniable (see Abigroup Ltd v Sandtara Pty Ltd [2002] NSWCA 45 at [9] and [12] per Stein JA, with whom Giles JA and Young CJ in Eq agreed): what is in contest is its relevance.…
Royal Botanic Gardens and Domain Trust v South Sydney City Council
[2002] HCA 5 Para 1

…In Royal Botanic Gardens and Domain Trust v South Sydney City Council (2002) 240 CLR 45, Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ approved the reference by Fitzgerald JA (below) to the well known passage of Mason J in Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337 a…
Trawl Industries of Australia Pty Ltd (In Liq) v Effem Foods Pty Ltd
[1992] FCA 377 Para 1

…basis is adopted: [370-371]. Also for present purposes, Einstein J, after reference to Trawl Industries of Australia Pty Ltd v Effem Foods Pty Ltd (1992) 36 FCR 406, and on appeal [at (1993) 43 FCR 510], held that, since the focus is on shared “legal interests”, rather than merely shared economic interests, the onl…
Ankar Pty Ltd v National Westminster Finance (Australia) Ltd
[1987] HCA 15 Para 1

…cility Agreement containing the guarantee, the principles discussed by the High Court in Ankar Pty Ltd v National Westminster Finance (Australia) Ltd (1987) 162 CLR 549, as confirmed in Andar Transport Pty Ltd v Brambles Ltd (2004) 217 CLR 424, are, at least initially, applicable.…
Darlington Futures Ltd v Delco Australia Pty Ltd
[1986] HCA 82 Para 1

…pproach adopted by the High Court to the interpretation of both exclusion and limitation clauses. In Darlington Futures Ltd v Dalco Australia Pty Ltd (1986) 161 CLR 500, the High Court held that the interpretation of such a clause is to be determined by construing it according to its natural and ordinary meaning, rea…
Codelfa Construction Pty Ltd v State Rail Authority of New South Wales
[1982] HCA 24 Para 1

…the reference by Fitzgerald JA (below) to the well known passage of Mason J in Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337 at 352 respecting the admissibility of evidence of surrounding circumstances to assist in the “interpretation” of a written contract “if a language b…
Port of Melbourne Authority v Anshun Pty Ltd
[1981] HCA 45 Para 1

…d the application of the Anshun doctrine, derived from the reasons of Gibbs CJ, Mason and Aickin JJ in Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589. Allsop P made brief observations on the topic, limiting them to the proposition that, in an appropriate case (which might be thought to be unusual), i…
Ramsay v Pigram
[1968] HCA 34 Para 1

…he sole director and shareholder of a company did not give rise to privity of interest in the sense considered by the High Court in Ramsay v Pigram (1968) 118 CLR 271: at [64]. He further observed that while a person could be sole director and shareholder and the relevant company could be described as an alter ego, t…
Sunbird Plaza Pty Ltd v Maloney
[1988] HCA 11 Para 1

…unusual distinction (i.e. between an indemnity and a guarantee), it is clear, as the consideration in Andar of Sunbird Plaza Pty Ltd v Moloney (1988) 166 CLR 245 at 254 shows, that guarantee provisions and indemnity clauses differ in form and effect: at 436-437 [22]. As analysed by Mason CJ in Sunbird Plaza, a contr…
Chan v Cresdon Pty Ltd
[1989] HCA 63 Para 1

…atus of a provision in a guarantee should therefore be resolved in favour of the surety. As observed in Andar Transport , in Chan v Cresdon Pty Ltd (1989) 168 CLR 242, Mason CJ, Brennan, Deane and McHugh JJ described that statement – which was set out in Ankar at 561 – as evidencing a “settled principle governing the…
[1897] AC 22
[1897] AC 22 Para 1

…Carlow County Council (1987) 1 IR 172 at 181: at [68]. The reasons of Keane J referred to the settled law since the decision in Salomon v Salomon [1897] AC 22 that the company on the one hand and its shareholders on the other hand are separate and distinct legal entities, and that while the interests of the com…
Duffield v Scott
100 ER 628 Para 1

…party is estopped from saying that the defendant in the first action was not bound to pay the money (within the terms of the indemnity), relying upon Duffield v Scott (1789) 3 Term Rep 374 at 377. For present purposes, the text states that this type of case involves “an estoppel by representation”, because the indemnifyin…
Trawl Industries of Australia Pty Ltd v Effem Foods Pty Ltd
923 F 2d 245 Para 1

…r separate instruments, unless an estoppel by representation basis is adopted: [370-371]. Also for present purposes, Einstein J, after reference to Trawl Industries of Australia Pty Ltd v Effem Foods Pty Ltd (1992) 36 FCR 406, and on appeal [at (1993) 43 FCR 510], held that, since the focus is on shared “legal interests”, rather than merely shared economic interes…
[1978] 2 NZLR 451
[1978] 2 NZLR 451 Para 1

…Similarly, the decision of the New Zealand Court of Appeal in National Bank of New Zealand v West [1978] 2 NZLR 451 merely shows a court determining what in fact the parties agreed with respect to the guarantee in question.…
[1964] 1 WLR 1131
[1964] 1 WLR 1131 Para 1

…he ones under present consideration, such as occurred in Re Clark’s Refrigerated Transport [1982] VR 989 and National Bank of Nigeria Ltd v Awolesi [1964] 1 WLR 1131, are of little specific assistance in a case such as this. In so far as they are of general assistance, they merely focus attention on what is the obje…

Legislation cited in this decision · 4

Uniform Civil Procedure Rules 1999 (Qld)
292, 293, 371, 705 5 mentions (from Para 1)
Corporations Act 2001 (Cth)
1 mention (from Para 1)
Supreme Court Act 1995 (Qld)
1 mention (from Para 1)
Trade Practices Act 1974 (Cth)
1 mention (from Para 1)

CITATION:	Balanced Securities v Thomas [2010] QDC 337
PARTIES:	BALANCED SECURITIES LIMITED (ACN 083 514 685) (Plaintiff) v DAVID LIONEL THOMAS (Defendant)
FILE NO/S:	1453 of 2010
DIVISION:	Civil jurisdiction
PROCEEDING:	Application for summary judgment
ORIGINATING COURT:	Brisbane
DELIVERED ON:	3 September 2010
DELIVERED AT:	Brisbane
HEARING DATE:	27 August 2010
JUDGE:	Dorney QC, DCJ
ORDERS:	The judgment of the court is that the defendant pay to the plaintiff the amount of $113,515.37.1. The plaintiff has liberty to apply to seek interest on the judgment sum by 4:00pm on 7 September 2010 and the defendant has liberty to respond by submissions filed by 4:00pm on 10 September 2010.2. The defendant’s application is dismissed. 3. The parties have liberty to file submissions with respect to costs by 4pm on 10 September 2010. 4.
CATCHWORDS:	SUMMARY JUDGEMENT – where both plaintiff and defendant seek summary judgement – whether “indemnifier’s exception” applies to guarantee – whether “third party” guarantor (as alter ego of company) bound by decision against company principal, even if exception does not apply – whether guarantee extends to default assessed costs of earlier decision – whether service of costs statement should be ordered anyway as a matter of fairness. Uniform Civil Procedure Rules 1999 rr 292, 293, 371, 705 420093 BC Ltd v Bank of Montreal (1995) 128 DLR (4^th) 488 (Alberta CA) Abigroup Ltd v Sandtara Pty Ltd [2002] NSWCA 45 Belton v Carlow County Council (1987) 1 IR 172 Champerslife Pty Ltd v Manojlovski & Anor [2010] NSWCA 33 Chan v Cresdon Pty Ltd (1989) 168 CLR 242 Clambake Pty Ltd v Tipperary Projects Pty Ltd [No 5] [2009] WASC 141 Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337 Darlington Futures Ltd v Dalco Australia Pty Ltd (1986) 161 CLR 500 Deen-Wilcox (as liquidator of SJP Formwork (NSW) Pty Ltd (in liq)) & Anor v Commissioner of Taxation (No 2) (2004) 49 ACSR 325 Duffield v Scott (1789) 3 Term Rep 374 Glenwood Homes Pty Ltd v Eberhard & Ors [2008] QSC 192 Hall v Commissioner of Taxation (2004) 51 ACSR 173 Harris v Commissioner for Taxation [2006] 2 Qd R 445 Jeans v Bruce [2004] NSWSC 539 National Bank of Nigeria Ltd v Awolesi [1964] 1 WLR 1131 National Bank of New Zealand v West [1978] 2 NZLR 451 Neumann Contractors Pty Ltd v Traspunt No 5 Pty Ltd [2010] QCA 119 Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 Ramsay v Pigram (1968) 118 CLR 271 Re Clark’s Refrigerated Transport [1982] VR 989 Royal Botanic Gardens and Domain Trust v South Sydney City Council (2002) 240 CLR 45 Salomon v Salomon [1897] AC 22 Sunbird Plaza Pty Ltd v Moloney (1988) 166 CLR 245 Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 Trawl Industries of Australia Pty Ltdv Effem Foods Pty Ltd (1992) 36 FCR 406
COUNSEL:	P. Travis for the…