Court of Appeal
Supreme Court
New South Wales
- Amendment notes
Medium Neutral Citation: BB Australia Pty Ltd v Danset Pty Ltd [2018] NSWCA 101 Hearing dates: 1 May 2018 Decision date: 16 May 2018 Before: Meagher JA at [1];
Barrett AJA at [2];
Simpson AJA at [71]Decision: 1 Appeal dismissed.
2 Cross appeal dismissed.
3 That BB Australia Pty Ltd pay the costs of all other parties to the proceedings in this Court.Catchwords: CONTRACT – particular parties – franchisee and franchisor - where franchise agreement breached by denying franchisor the opportunity to exercise option to purchase business assets – where assets sold to a third party without franchisor knowledge – whether franchisor suffered loss – where resultant loss equal to the difference between the price paid by the third party and the price to be paid under exercise of option – no such difference proved.
EQUITY – equitable remedies – account of profits – equitable compensation - where deceit and fraud by the franchisee – where third party induced breach - whether assets held on trust for the franchisor – whether otherwise the franchisor had an equitable interest in the business assets – no trust established – no fiduciary duty shown – no basis for award of account of profits or equitable compensation.
PROCEDURE – where certain claims reserved by trial judge for future consideration – whether Court of Appeal should determine those claims.Legislation Cited: A New Tax System (Goods and Services Tax) Act 1999 (Cth)
Supreme Court Act 1970 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)Cases Cited: Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170; [1981] HCA 39
Attorney General v Blake [2001] 1 AC 268; [2000] UKHL 45
BB Australia Pty Ltd v Bytan Pty Ltd [2012] VSC 171
BB Australia Pty Ltd v Constanti [2017] VSC 114
Black v S Freedman & Co (1910) 12 CLR 105; [1910] HCA 58
Browning v Brachers [2005] EWCA Civ 753; [2005] PNLR 44
Bunny Industries Ltd v FSW Enterprises Pty Ltd [1982] Qd R 712
Chan v Cresdon Pty Ltd (1989) 168 CLR 242; [1989] HCA 63
Chang v Registrar of Titles (1976) 137 CLR 177; [1976] HCA 1
Commissioner of Taxes (Q) v Camphin (1937) 57 CLR 127; [1937] HCA 30
Duncuft v Albrecht (1841) 12 Sim 189; 59 ER 1104
Englewood Properties Ltd v Patel [2005] 1 WLR 1961; [2005] EWHC 188 (Ch)
Fink v Fink (1946) 74 CLR 127; [1943] HCA 54
Fistar v Riverwood Legion and Community Club Ltd (2016) 91 NSWLR 732; [2016] NSWCA 81
General Tire & Rubber Co Ltd v Firestone Tyre & Rubber Co Ltd (No 2) [1975] 1 WLR 819
Goldsbrough Mort & Co Ltd v Quinn (1910) 10 CLR 674; [1910] HCA 20
House v The King (1936) 55 CLR 499; [1936] HCA 40
Howe v Teefy (1927) 27 SR (NSW) 301
Kern Corporation Ltd v Walter Reid…
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- Case
- [2018] NSWCA 101
- Decision Date
CaseChat Overview and Summary
The Court of Appeal was required to determine whether the franchisor had suffered a loss due to the franchisee's actions, and if so, the quantum of that loss. Specifically, the court considered whether the resultant loss was equal to the difference between the price paid by the third party and the price stipulated in the option to purchase. Furthermore, the court had to consider claims relating to deceit and fraud by the franchisee, and whether the third party had been induced to breach the contract. The court also had to determine if the assets were held on trust for the franchisor, or if the franchisor had an equitable interest in the business assets, which would form a basis for an award of an account of profits or equitable compensation. Finally, the court considered whether certain claims reserved by the trial judge for future consideration should be determined by the Court of Appeal.
The Court of Appeal found that no such difference in price, as alleged by the franchisor, had been proven. The court also determined that no trust was established and no fiduciary duty was shown, meaning there was no basis for an award of an account of profits or equitable compensation. The court concluded that the franchisor had not established that it suffered a loss. Consequently, the appeal and cross-appeal were dismissed.
The orders of the Court of Appeal were that the appeal be dismissed, the cross-appeal be dismissed, and that BB Australia Pty Ltd pay the costs of all other parties to the proceedings in the Court of Appeal.
Orders
Orders of the court
1 Appeal dismissed.
2 Cross appeal dismissed.
3 That BB Australia Pty Ltd pay the costs of all other parties to the proceedings in this Court.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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