JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: BEECK -v- KOHLEN [2013] WASC 166
CORAM: ALLANSON J
HEARD: 12-15 FEBRUARY 2013
DELIVERED : 9 MAY 2013
FILE NO/S: CIV 1467 of 2011
BETWEEN: MARTIN HARRY BEECK
Plaintiff
AND
PETER JOSEPH KOHLEN
First DefendantSUSAN KAY FLEMING
Second Defendant
Catchwords:
Contract for the sale of land - Offer and acceptance - Whether finance clause applicable - What constitutes a reasonable time - Turns on own facts
Contract for sale of land - Specific performance
Contract for sale of land not a lot - Clause 13 of REIWA General Conditions - Election, waiver and estoppel - Turns on own facts
Fiduciary relationship - Architectural designer and client - Agent for limited purposes - Turns on own facts
Legislation:
Strata Titles Act 1985 (WA)
Town Planning and Development Act 1928 (WA)
Result:
Application for specific performance dismissed
Category: B
Representation:
Counsel:
Plaintiff: Mr G J Carter
First Defendant : Mr A J Musikanth
Second Defendant : Mr A J Musikanth
Solicitors:
Plaintiff: Optima Legal
First Defendant : Macdonald Rudder
Second Defendant : Macdonald Rudder
Case(s) referred to in judgment(s):
Aequitas Ltd v Sparad No 100 Pty Ltd (formerly Australian European Finance Corp Ltd) [2001] NSWSC 14; (2001) 19 ACLC 1006
Australian Broadcasting Commission v Australasian Performing Right Association Ltd [1973] HCA 36; (1973) 129 CLR 99
Birtchnell v Equity Trustees, Executors and Agency Co Ltd [1929] HCA 24; (1929) 42 CLR 384
Breen v Williams [1996] HCA 57; (1996) 186 CLR 71
Codelfa Construction Pty Ltd v State Rail Authority of NSW [1982] HCA 24; (1982) 149 CLR 337
Commonwealth Bank of Australia v Smith [1991] FCA 375; (1991) 42 FCR 390
Commonwealth of Australia v Spotless Catering Services Ltd [2000] WASCA 302
Daly v Sydney Stock Exchange Ltd [1986] HCA 25; (1986) 160 CLR 371
Grundt v Great Boulder Pty Gold Mines Ltd [1937] HCA 58; (1937) 59 CLR 641
Hospital Products Ltd v United States Surgical Corporation [1984] HCA 64; (1984) 156 CLR 41
John Alexander's Clubs Pty Ltd v White City Tennis Club Ltd [2010] HCA 19; (2010) 241 CLR 1
Khoury v Government Insurance Office of New South Wales [1984] HCA 55; (1984) 165 CLR 622
Legione v Hateley [1983] HCA 11; (1983) 152 CLR 406
Perri v Coolangatta Investments Pty Ltd [1982] HCA 29; (1982) 149 CLR 537
Pilmer v The Duke Group Ltd (in liq) [2001] HCA 31; (2001) 207 CLR 165
Sargent v ASL Developments Ltd [1974] HCA 40; (1974) 131 CLR 634
Sequel Drill & Blast Pty Ltd v Whitsunday Crushers Pty Ltd [2009] QCA 218
Thompson v Palmer [1933] HCA 61; (1933) 49 CLR 507
United Dominions Corporation Ltd v Brian Pty Ltd [1985] HCA 49; (1985) 157 CLR 1
ALLANSON J: In February 2006, Peter Joseph Kohlen and Susan Kay Fleming agreed to sell a commercial unit on land they owned to Martin…
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- AGLC
- Beeck v Kohlen [2013] WASC 166
- Case
- [2013] WASC 166
- Decision Date
CaseChat Overview and Summary
The legal issues before the court included determining whether a fiduciary relationship existed between Mr Beeck and the Kohlens, and if so, whether it extended to the sale of a specific unit within the property development. The court was also required to interpret a finance clause within the contract and ascertain whether it applied to the sale of a particular unit. Furthermore, the court needed to decide if the time taken to accept an offer was reasonable, a determination that was to be made on the facts of the case.
The court found that no fiduciary relationship existed between Mr Beeck and the Kohlens in relation to the sale of the specific unit. While Mr Beeck had acted as an agent for the Kohlens in obtaining approval from the Town of Claremont, this was a limited role. The court held that fiduciary duties do not automatically arise from a professional relationship or from reliance on advice. The court also found that the finance clause did not apply to the sale of the specific unit and that the time taken to accept the offer was reasonable given the circumstances. The court ultimately rejected the claim for specific performance and dismissed the action.
The final orders of the court were that the defendants were not required to compensate the plaintiff for any loss suffered as a result of the breach of fiduciary duty, and the claim for specific performance was dismissed. The court found that the defendants were not liable for the plaintiff's losses and that the plaintiff's action was unsuccessful in its entirety.
Orders
Orders of the court
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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
A fiduciary relationship can also arise without the parties having reached agreement on the terms to govern their relationship: United Dominions Corporation Ltd v Brian Pty Ltd [1985] HCA 49; (1985) 157 CLR 1, 11 - 12. The existence and scope of the duty may derive from a course of dealing: the subject matter over which the fiduciary obligations extend 'is to be ascertained, not merely from the express agreement of the parties, whether embodied in written instruments or not, but also from the course of dealing actually pursued': Birtchnell v Equity Trustees, Executors and Agency Co Ltd [1929] HCA 24; (1929) 42 CLR 384, 408 The relationship between the plaintiff and the defendants may have included fiduciary obligations in relation to the dealings that Mr Beeck conducted with the Town of Claremont on the defendants' behalf. In those dealings, Mr Beeck was apparently acting as the defendants' agent. But that was a limited, self‑contained aspect of their relationship. In other aspects of his dealings with the defendants, the evidence does not show either an agreement that he would act on their behalf or in their interests, in the relevant sense, or a course of conduct in which he did so act. It is not enough that he was in a professional relationship with them in which he was providing services, including advice. Nor is it sufficient that they relied on his advice. There are many relationships where professional services include advice but which are not traditionally regarded as giving rise to fiduciary obligations. The relationship between architect and client is not one which falls within the recognised group of fiduciary relationships. It is possible that within the context of a relationship not commonly regarded as creating fiduciary obligations, one party may undertake or agree to act in a manner which, because of the relationship of confidence which exists between the parties, requires that party to subordinate his or her interests to the interests of the other. This may occur where one party is advising the other: in relation to banks and financial advisers see, for example, Commonwealth Bank of Australia v Smith [1991] FCA 375; (1991) 42 FCR 390, 391. See also Daly v Sydney Stock Exchange Ltd [1986] HCA 25; (1986) 160 CLR 371; Aequitas Ltd v Sparad No 100 Pty Ltd (formerly Australian European Finance Corp Ltd) [2001] NSWSC 14; (2001) 19 ACLC 1006, 1026 ‑ 1027. I can identify no special feature in the relationship between Mr Beeck and the defendants which would give it this character. First, while there was initially a suggestion that he would have equity in the project, that had fallen away by 2005. In his letter of 1 June 2005, Mr Beeck proposed only to defer taking fees until the project was underway. Even if there was an agreement that he would discount his fees, that would not amount to an undertaking to put the defendants' interests over his own. The defendants do not, in any case, rely on any such agreement. Second, the matters relied on by the defendants do not go to the essential elements that give rise to fiduciary obligations. Mr Beeck had acted as the defendants' agent in obtaining approval from the Town of Claremont, and he did provide advice on various matters from time to time. But I am satisfied that his agency was limited. He had in December 2003 given some estimates of anticipated times for various steps in the project, but not in circumstances where he could be regarded as advising in relation to the sale of the units in the project. He had not undertaken to advise with regard to the sale of the units generally, or commercial unit 3 specifically, and the defendants had not asked him to. His limited role in assisting in obtaining the appraisals by Mack Hall is irrelevant. None of the matters relied on by the defendants arising out of the course of their dealings with Mr Beeck fettered his freedom to contract in his own interests in buying commercial unit 3.