Browne t/a Contractor Connections v Deklight Services Pty Ltd

[2010] QDC 364

DISTRICT COURT OF QUEENSLAND

CITATION:

Browne t/a Contractor Connections v Deklight Services Pty Ltd [2010] QDC 364

PARTIES:

TEVAI BROWNE TRADING AS CONTRACTOR CONNECTIONS ABN 90 942 774 128

(Plaintiff/Applicant)

V

DEKLIGHT SERVICES PTY LTD ACN 125 055 272

(Defendant/Respondent)

FILE NO/S:

BD1162/10

DIVISION:

Civil

PROCEEDING:

Application

ORIGINATING COURT:

District Court, Brisbane

DELIVERED ON:

10 September 2010 (ex tempore)

DELIVERED AT:

Brisbane

HEARING DATE:

21 July 2010

JUDGE:

Irwin DCJ

ORDER:

1. Application dismissed
2. Plaintiff/applicant to the pay the defendant/respondent’s costs of and incidental to the application on the standard basis to be assessed

CATCHWORDS:

PROCEDURE – DISTRICT COURT PROCEDURE – QUEENSLAND – PRACTICE UNDER RULES OF COURT – SUMMARY JUDGMENT – where plaintiff/applicant sought summary judgment against the defendant/respondent for the amount of $192,539.64 and the counterclaim be struck out – whether the defendant/respondent had no real prospect of successfully defending the applicant’s claim – whether the defendant/respondent had a real prospect of succeeding in the counterclaim

Uniform Civil Procedure Rules 1999 (Qld) r 149, r 150, r 157, r 166, r 171, r 190, r 292

Agar v Hyde (2000) 201 CLR 552, cited

Cairns CC v Britts [2005] QCA 94, cited

Deputy Commissioner of Taxation v Salcedo [2005] QCA 227, applied

Fancourt v Mercantile Credits Ltd (1983) 154 CLR 87, cited

Kev Leamon Earthmovers Pty Ltd v Hammond Village Pty Ltd (1998) 19 Qld Lawyer Reports 10, cited

COUNSEL:

A.A. Evans for the plaintiff/applicant

N.E. Ulrick for the defendant/respondent

SOLICITORS:

McInnes Wilson for the plaintiff/applicant

Bevan Bowe & Associates for the defendant/respondent

HIS HONOUR:  This is an application filed in this Court on 1
July 2010 by the plaintiff/applicant (the plaintiff) that
judgment be entered for her against the defendant/respondent
(the defendant) pursuant to Rule 292 of the Uniform Civil
Procedure Rules 1999(Qld)(the UCPR) in the sum of $192,539.64.

In addition, an order is sought striking out the defendant's
counterclaim.  Orders about payment of interest and costs are
also sought. 

Rule 292(1) permits a plaintiff at any time after a defendant files a Notice of Intention to Defend to apply to a Court for such an order. Under Rule 292(3) if the Court is satisfied that -
(a) the defendant has no real prospects of successfully
defending all or any part of the plaintiff's claim; and
(b) there is no need for a trial of the claim or part of the
claim,
the Court may give judgment for the plaintiff against the
defendant for all or part of the plaintiff's claim and may
make any other order the Court considers appropriate.

In Deputy Commissioner of Taxation v Salcedo [2005] QCA 227,
Williams JA reviewed the relevant authorities and concluded at
[17] that the Court must apply the words found in the rules.
His Honour also said:  "But, and this underlies all that is
contained in the UCPR, ultimately the rules are there to
facilitate the fair and just resolution of the matters in
dispute.  Summary judgment will not be obtained as a matter of
course and the judge determining such an application is
essentially called upon to determine whether the respondent to
the application has established some real prospect of
succeeding at a trial; if that is established, then the matter
must go to trial."

In this case, McMurdo P stated at [3] that nothing in the UCPR
detracts from the well-established principle that issues
raised in proceedings will be determined summarily only in the
clearest cases.  Atkinson J emphasised at [44] that if a Court
is satisfied of the circumstances set out in Rule 292(2)(a)
and (b) then the Court has a discretion to give judgment for
the plaintiff.  At [45] she categorised this as a residual
discretion to refuse summary judgment even when the
requirements of paragraphs (2)(a) and (b) are satisfied.

Her Honour also said at [47]:
"The Court must consider whether there exists a real, as
opposed to a fanciful prospect of success.  If there is no
real prospect that a party will be successful in all or part
of a claim, and there is no need for a trial, then ordinarily
the other party is entitled to judgment."

The plaintiff is and was at the relevant times an individual
carrying on business as a wholesaler of electrical products.
On 16 April 2010, it filed a claim in the sum for which
summary judgment is sought as moneys due and owing for goods
supplied and alternatively as damages for breach of contract.
On 13 May 2010, the defendant filed a Notice of Intention to
Defend and a defence and counterclaim.  Accordingly, the
plaintiff was entitled to make the present application.

On 3 June 2010, a reply and answer was filed by the plaintiff.
On 1 July 2010, an affidavit of David James Van Vegchel was
filed.  He is the domestic and business partner of the
plaintiff and operates the plaintiff business as a partnership
with her.  Mr Evans of Counsel for the plaintiff read each of
these documents for the purpose of the application.  Mr Ulrick
of Counsel for the defendant has relied on the affidavit of
David Edward Keating filed on 20 July 2010.  Mr Keating is the
sole director of the defendant.

As admitted by the defendant, on or about 22 February 2009,
the defendant submitted an application in writing requesting
the provision of goods on credit from the plaintiff.  The
terms and conditions of the credit application included:
"Strictly 30 days from the date of invoice which the goods are
purchased."  As is also admitted from April 2009 to November
2009 the defendant requested the supply of goods from the
plaintiff.

The plaintiff also alleged in paragraphs 5 and 6 of the
statement of claim that during this period, the plaintiff
supplied the goods in accordance with the defendant's request
and issued its tax invoices and outstanding statement in
respect of the goods supplied, and received payment from the
defendant in partial satisfaction of the invoices, with the
consequence that as alleged in paragraph 7, the amount claimed
is due and owing.  The invoices are itemised in a table of
particulars to paragraph 6.

It is also asserted that the defendant has failed or neglected
to pay this amount despite demand. 

The defence contains two seemingly contradictory paragraphs with reference to paragraphs 5 and 6 of the statement of claim. Paragraph 3 of the defence does not admit these paragraphs, whereas paragraph 4C states that save as aforesaid (ie, in paragraphs 4A and B) the defendant admits them. Mr Evans referred to the fact of the non-admission in paragraph 3 of the defence not being accompanied by a direct explanation of why the facts cannot be admitted as required by Rule 166(4) of the UCPR.

He submits with reference to Rule 166(3) that it is untenable, the defendant claims it is unable to admit these matters as the matters pleaded in paragraphs 5 and 6 of the statement of
claim refer directly to conduct involving the defendant.
Therefore, it is asserted in the ordinary course this failure
to comply with Rule 166(4) would result in paragraphs 5 and 6
being deemed to be admitted pursuant to Rule 166(5):  Cairns
CC v Britts [2005] QCA 94. However, as Mr Evans accepted
during argument, paragraph 3 can be ignored when reference is
made to paragraph 4C of the defence.

I consider that paragraph 4C has the effect that the defendant
has admitted paragraphs 5 and 6 of the statement of claim
subject to what is asserted in paragraphs 4A and B of the
defence.  Paragraph 4A relates to tax invoices provided by the
plaintiff to the defendant in relation to an electrical
project undertaken by the defendant at Coles Supermarket
Middle Park (the Middle Park project).  Paragraph 4B relates
to tax invoices provided by the plaintiff to the defendant in
relation to electrical work undertaken by the defendant at
Mount Tamborine (the Mount Tamborine project).  Each invoice
referred to was included in the plaintiff's particulars to
paragraph 6 of the statement of claim.  The plaintiff admits
that these invoices relate to the respective projects.

With reference to the Middle Park project, the defendant
pleaded that in pricing its works for the project, it relied
on the plaintiff's quotation of 26 August 2009 for a fixed
price of $181,072.82 inclusive of GST.  The defendant pleads
that the tax invoices it has identified as relating to the
Middle Park project do not match this quotation and that the
plaintiff overcharged the defendant the sum of $31,987.98
(excluding GST) and additionally did not deliver goods as
quoted.  This assertion is particularised in a table which is
Schedule A to the defence.  When this schedule is analysed, it
becomes apparent that the sum of $31,987.98 relates to the items which have been supplied to the defendant in addition to what was quoted.  Where there are mere variations between the quote and the invoice prices of the goods supplied in accordance with the quote, there are some items where the invoice price is more and some where it is less.  These effectively cancel themselves out.  In general, the variations are in matters of cents.

In relation to goods which are alleged not to have been
delivered, Mr Ulrick submits that the proper inference to be
drawn from Schedule A is that these are the goods
particularised under the heading "Goods quoted but not
invoiced".  These total $1,378.22.  However, Mr Keating swears
in his affidavit that the plaintiff failed to deliver to the
defendant goods to the value of $864.44 as shown in that
schedule.  This is a specific reference to only one line item
of goods.  Therefore, I proceed on the basis that this is the
value of the goods undelivered as itemised in the schedule.

It is further pleaded that five of these invoices were not
provided to the defendant in a timely manner notwithstanding a
request for them on 10 November 2009 and they were not
received until 18 February 2010.  It is pleaded that this
delay resulted in the defendant being unable to process final
payments with the builder for this project.

It is then asserted the plaintiff acted fraudulently or
recklessly in not caring whether the invoices matched the
quotation provided and providing false invoices late, thereby
causing significant delay to the defendant in processing true
and accurate accounts for payment and resulting in significant
loss to the defendant.

In relation to this, the defendant also pleaded in paragraph 2
of the defence that it was an implied term of the credit
application that the plaintiff's tax invoices would be true
and correct, provided in a timely manner and would match the
prices quoted by the plaintiff for the goods supplied.

This is also relevant to the Mount Tamborine project in respect of which the defendant pleads that in pricing its work for the project it relied on the veracity of the plaintiff's quotation for a fixed price of $24,166.34 inclusive of GST.  It is then asserted that the plaintiff acted fraudulently or recklessly in not caring whether the invoiced amount as detailed in one of the invoices matched the amount quoted and in respect to this invoice, the defendant was overcharged $3,813.62.

It is also asserted that the defendant suffered loss in
challenging the excess.  I note it is not alleged that these
invoices were not provided in a timely manner.  For this
reason, it denies that the sum claimed is due and owing by it
to the plaintiff and payable to them.  It also does not admit
that it has failed and/or neglected to pay this amount despite
demand.  It pleads that the demand is excessive and:

.on or about 10 November 2009 it requested invoices for the Middle Park project from the plaintiff to substantiate the claim;

.    on numerous occasions the defendant (through its solicitors) sought particulars from the plaintiff; and

.on 18 February 2010 the plaintiff provided the inaccurate

invoices which did not match the final quotation.

The counterclaim repeats and relies on these aspects of the
defence.  In addition, it pleads the following matters in
support.  Before the plaintiff provided the invoices for the
Middle Park project in February 2010, the plaintiff caused to
be served on the defendant a creditor's demand for summary
debt dated 19 January 2010 (the statutory demand) pursuant to
the Corporations Act 2001 together with an affidavit by the
defendant Ms Browne of 14 January 2010 which stated that the
total of $198,362.06 of the debts mentioned in the statutory
demand is due and payable to the debtor company. 

The statutory demand included an invoice which had not been
referred to in a monthly statement dated 31 October 2009 which
the defendant had received earlier.  It also included reference to the Mount Tamborine project invoice which the defendant asserts involved the overcharge of $3,813.62. 

A copy of the statutory demand and supporting affidavit are exhibits to Mr Keating's affidavit.  It is noted that in the schedule, while the total amount of debt claimed is $198,362.06, the amounts of the individual invoices add up
to $234,972.58.  This was the subject of argument before me in
relation to the assertions of fraud against the plaintiff.  I
will return to this issue.

In paragraph 8 of the counterclaim, the defendant pleads that
the defendant's credit application was suspended by its main
supplier of electrical components, Ideal Electrical Pty Ltd
(Ideal Electrical) following the issue of the statutory
demand.  It is then asserted in paragraph 9 that in relation
to the issue and service of the statutory demand on the
defendant, the plaintiff acted fraudulently:-
(a) in swearing/affirming an excessive debt which was false to
the knowledge of the plaintiff;
(b) in not caring whether the invoice charges match the
amounts and the quotations provided by the plaintiff to the
defendant;
(c) in providing false invoices where charges were excessive
to the knowledge of the plaintiff; and
(d) in providing those invoices late.

It is then pleaded that as a consequence of the matters
specified in the counterclaim which includes the matters
pleaded in the defence, the defendant did not process true and
accurate accounts for payment with its builder and has
suffered loss.

This loss is particularised as follows:
(a) solicitor and own client legal costs in defending the
statutory demand of $9,505;
(b) inability to process final payments with its builder for
the Middle Park project and the Mount Tamborine project.
Details of such financial loss will be provided prior to
trial; and
(c) the suspension of its credit application with its main
supplier of electrical components, Ideal Electrical Pty Ltd.
Details of such financial loss will be provided prior to
trial.
In relation to the first of these matters, Mr Keating's
affidavit attaches a Consent to Order of Registrar of 26
February 2010 signed by the solicitors of both parties.  That
consent is given to the Registrar of the Supreme Court making
an order that the application be dismissed and there be no
order as to costs.

In relation to the loss asserted due to an inability to lodge
final payments in respect to the two projects, Mr Ulrick
accepts that this has not yet been addressed even in
Mr Keating's affidavit. 

However, the alleged loss flowing as a consequence of the suspension of the credit application is addressed in Mr Keating's affidavit on the basis that he was informed by the credit manager of Ideal Electrical that the plaintiff had sent or caused to be sent to Ideal Electrical a copy of the statutory demand with the purpose of damaging the defendant's business in consequence of which Ideal Electrical immediately suspended the defendant's working account for the supply of electrical equipment.

I note that the defendant has not pleaded the plaintiff's
action as being responsible for this.  The loss and damage
which the defendant claims was caused as a result is
$144,387.36.  This comprises extra (alternative) lighting that
he had to purchase from other dealers and the need to replace
this by correct lighting on other projects resulting in the
cost of this lighting being thrown away.  There was also the
cost of $74,480 for labour to install this lighting which was
wasted.

In the reply and answer, the plaintiff said that:
(a) all tax invoices were true and correct at the time of
issue;
(b) all tax invoices were provided in a timely manner; and
(c) there was no obligation for the plaintiff's tax invoices
to match the quotations as the credit application stated:
"The prices referred to herein are recommended prices only and
there is no obligation to comply with the recommendations.
All prices are subject to alteration without notice."

The plaintiff joins issue with the defendant's pleading on
this basis.

It is also denied that the $181,072.82 quotation was "final"
and sets out in detail the reasons for this, including that as
at the date of filing the statement of claim, the defendant
had not cancelled a purchase order of 25 August 2009 in the
amount of $224,000 and there were no variations or amendments
to a third quotation for $233,162.94 which was forwarded to
the defendant on or about 2 October 2009.  It was said that
this remained the position on 2 January 2010.

The plaintiff denied the allegation it did not provide the
invoices for the Middle Park project in a timely manner on the
basis that they were delivered to the defendant on or about
two days after the date of invoicing and on or about 21
December 2009.  "Ross" of the defendant's office advised Mr Van Vegchel that all invoices had been received and that the
defendant had been paid by the builder.

It denies that the first occasion it provided the invoices was
on or about 18 February 2010 and that the alleged delay in
providing the invoices resulted in the defendant being unable
to process the payment.  It is also asserted that to the best of the plaintiff's knowledge there was never a dispute regarding the amount of the invoices and that up until 12 January 2010 Mr Keating had communicated and promised to Mr Van Vegchel on various occasions that payment of the account would be forthcoming.

With reference to the Mount Tamborine project, the plaintiff
does not admit that the defendant relied on the veracity of
the quotation of $24,166.34 when pricing its work for the
project for reasons including that a quotation is only an
approximation of the prices to be charged and this is why the
invoice alleged to involve an overcharge does not match the
amount quoted.  Therefore, the plaintiff denies that it
overcharged the defendant in respect of this invoice.

With respect to the counterclaim, the plaintiff admits that a
monthly statement dated 31 October 2009 was faxed to the
defendant on or about 10 November 2009 and the defendant
sought copies of the invoices referred to in the statement on
that date.  This is supported by Mr Van Vegchel's affidavit
which exhibits invoices, statements and picking slips
including the invoices referred to in the monthly statement
which were said to have been faxed to the defendant on 10 November 2009.  It denies that it acted fraudulently in relation to the issue of the statutory demand.

Mr Van Vegchel's affidavit attests to the history of the
relationship with the defendant, including the revised
quotations concerning the Middle Park project to which I have
referred.  He also deposes to the history of the account with
the defendant and to faxing paperwork to the defendant on 10
November 2009, although his fax machine was not set up to
provide a confirmation of faxes sent.  The fax date stamped on
the documents is in fact 10 October 2009.  He also exhibits
the relevant delivery dockets received from their suppliers in
respect of the goods and various tax invoices and statements
to the defendant in respect of the goods supplied and a reconciliation statement he prepared on or about 18 February
2010 which details the history of transactions with the
defendant and calculates the amount owing as the sum claimed.
In Mr Keating's affidavit, other than the matters I have
already referred to, he deposes to relying on the $181,072.82
quotation which he describes as a "fixed price" quotation and

asserts that the 224,000-dollar quotation was cancelled in a
telephone call with Mr Van Vegchel.  He also denies that there
was a revised quotation of $233,162.94.  He also denies
receiving a verbal quotation of $246,000 as contended by
Mr Van Vegchel in his affidavit.  He deposes that on 10
November 2009, he received a monthly statement from the
plaintiff contending that $170,807.94 was due and owing.  It
was dated 31 October 2009.  He also deposes he did not receive
any invoices from the plaintiff prior to receiving this
statement.

In paragraph 13 he referred to the statutory demand for
$198,362.06 and asserts that he believes that the plaintiff
knew this amount was incorrect and false.  In paragraph 14 he
says he received a monthly statement from the plaintiff on 29
January 2010 contending that $198,362.06 was due and owing to
the plaintiff.  He says this monthly statement was
manufactured to support the plaintiff's statutory demand.

Mr Ulrick made submissions along these lines in opposing this
application.  This is an issue to which I will return. 

He asserted that as a result of the plaintiff's failure to
deliver goods as ordered and its failure to deliver accurate
invoices, he ordered a large quantity of lighting equipment
from Ideal Electrical.  He then referred to the information
from the credit manager from that business that the plaintiff
had sent or caused to be sent to Ideal Electrical a copy of
the statutory demand with the purpose of damaging the
defendant's business and to the loss or damage he claimed is
caused to the plaintiff.  He denies that the defendant is indebted to the plaintiff for the amount claimed or any other amount. 

Against this background, I first consider the issue as to whether, on the basis of the pleadings, the plaintiff is entitled to a judgment in its favour subject to the set-off alleged in the counterclaim.

In argument before me, Mr Evans did not seek to press that the
plaintiff was entitled to judgment for the full amount of the
claim.  He approached the matter on the basis of what the
defendant has admitted in its pleadings.  On this basis, he
submitted that the plaintiff is entitled to a judgment of
$153,933.05.  For the purposes of this application only, he
proceeds on the basis that the operative quote between the
parties was that of $181,072.82 in relation to the Middle Park
project.  Similarly, he proceeded on the basis that the
operative quote for the Mount Tamborine project was
$24,166.34.  He refers to the fact that in paragraph 4C of the
defence, the defendant admits paragraphs 5 and 6 of the
statement of claim save for the matters raised in paragraphs
4A and 4B of the defence.

He argues that paragraphs 4A and 4B make allegations with
respect to the amounts charged in specific invoices and the
timing of the provision of some of the invoices.  Further
allegations are made with respect to provision of quotations
and purchase orders where various work was undertaken and the
effect of the late provision of invoices.  However, he submits
that no allegation is made refuting delivery of the goods in
accordance with the defendant's requests as alleged in
paragraphs 5 of the statement of claim or that payments by the
defendant were limited to those referred to in the table at
paragraph 6.  It is therefore submitted that the defendant has
admitted that the goods were delivered to it by the plaintiff
with only the terms on which they are delivered being in
controversy.

As I have previously said, Mr Ulrick submitted that the proper
inference is that the defendant did not receive the $1,378.22
worth of goods under the heading "Goods Quoted but not
Invoiced".  Mr Ulrick also asserts that the defence and
counterclaim as presently drawn do not highlight that
materials have not been delivered to the defendant over and
above the amount of $31,987.98 which is referred to as an
overcharge but, as I have previously said, really represents
an amount for goods which were delivered but not quoted for.
He told me that he had instructions to this effect and these
matters were set out in Mr Keating's affidavit in defence of
the statutory demand.  However, this affidavit is not before
me and accordingly there is no evidence to support this
submission.

Although he accepts that the defendant's pleadings have been
drawn in such a way that one can conclude that they admit
delivery, he submits that I should not give effect to the
pleadings.  This is an extraordinary submission given there
has been no attempt to amend the pleadings in the 20-day
period after the application was made or at any other time.

Mr Ulrick, whilst saying that there are a number of
difficulties with the pleading, also told me it would be a
long and involved process to amend it.  In addition, the
submission is contradicted by Mr Keating's own evidence which,
as I have said, is to the effect that the plaintiff failed to
deliver goods to the value of $864.44.  As Mr Evans correctly
says, this demonstrates that Mr Keating is capable of
identifying what was not delivered.  He refers me to Mr Van
Vegchel's affidavit at paragraph 32 and Exhibit 10 to that
a ffidavit which are said to be the relevant delivery dockets
from suppliers in respect to the goods.  Although these
dockets are not clearly itemised so as to identify the goods
to which they relate, I also agree with Mr Evans that if there
was any strength in Mr Ulrick's submissions about the
non-delivery of goods, this paragraph of Mr Van Vegchel's
affidavit and the exhibit could have been responded to in
Mr Keating's affidavit.  In the absence of him doing so, I
accept the proposition that with the exception of $864.44
worth of goods, the defendant has admitted that the goods to
which the invoices in the table to paragraph 6 of the
statement of claim relate were delivered to the defendant.

For completeness, I address Mr Ulrick's submission that the
goods in this case were not actually delivered to the
defendant but to his builder in respect of these projects.  He
relies on paragraph 10 of the counterclaim and particularly
paragraph 10(b) in support of this.  This was as follows:
"As a consequence of the matters specified in paragraphs 1 to
9 aforesaid, the defendant did not process true and accurate
accounts for payment with its builder and has suffered
financial loss.
.....
(b) an inability to process final payments with its builder
for the Middle Park project and the Mount Tamborine project.
.....

"

He submits that the inference that would be drawn from normal
building practice is that the goods were delivered to the
builder, although he accepts this should have been spelt out.
I consider that if the goods were delivered to the defendant's
builder, given Mr Keating's reference to the non-delivery of
goods to the defendant in his affidavit, he would have
specifically addressed this also.  It may be that he did not
do so because, if they were received by the builder, he
accepted that the receipt was on the defendant's behalf.

Proceeding from the basis of my finding that by the
defendant's pleading, it is admitted that the goods referred
to in the invoices itemised in the table to paragraph 6 of the
statement of claim were delivered to the defendant, given that
paragraphs 5 and 6 of the statement of claim are subject to
paragraphs 4A and 4B of the defence in respect of invoices
which are specifically referred to in those paragraphs.

It follows, as Mr Evans submits, that all the goods referred
to in the invoices which are not specifically referred to in
those paragraphs were supplied and delivered to the defendant
by the plaintiff at the defendant's request and in accordance
with the terms of the credit application.  These are invoices
included in the plaintiff's particulars that do not relate to
the Middle Park or Mount Tamborine projects.  The invoices
total $64,030.38.  I consider that the plaintiff was at least
entitled to be paid this amount related to the invoices which
are not in dispute.

It is submitted that on the same reasoning the defendant
admits (subject to the counterclaim) that it was liable to pay
the amount of the disputed invoices in accordance with the
quotations.  Therefore, putting aside the allegation that
goods supplied in these invoices were not supplied in
accordance with quotations given by the plaintiff which are
the subject to Schedule A of the defence and counterclaim, the
minimum amount it is submitted the defendant is liable to pay
is the $181,072.82 quoted for the Middle Park project and the
$24,166.34 for the Mount Tamborine project.  It is accepted
that this is subject to the recognition in the particulars to
paragraph 6 of the statement of claim that the defendant was
given a credit of $11,410.07 for some goods which were
returned.  There is no dispute between the parties that as set
out in those particulars the defendant had previously paid
$103,926.42.

The total of the invoices not pertaining to either quote and
the quotes for the Middle Park and the Mount Tamborine
projects is $269,269.54.  When the total for the credit and
previous payments is deducted, as set out conveniently in
Exhibit 1, which was prepared by Mr Evans, this leaves an
outstanding balance of $153,933.05.  In calculating this
figure, as Mr Evans submitted, the total value of the goods
designated in Schedule A as being quoted but not invoiced have
not been included.  This is because the claim is based on the
invoices and if goods are not included in the invoices, they
are not included in the claim, including the goods to the
value of $864.44 which Mr Keating said were not received.

On this basis it is submitted that on the basis of the
defendant's own admissions, it remains liable to the plaintiff
in the amount of $153,933.05.  As Mr Evans put it, on the
defendant's case, this is the highest judgment the plaintiff
is entitled to. 

Mr Ulrick commenced his response on behalf of the defendant by submitting that on the present state of the pleading, the starting position of $181,072.84 must be read in light of Schedule A to the defence.  I note that in the written submission he identified as a triable issue that there
was a dispute concerning the defendant's contention that the
$181,072.82 was a fixed price quotation for the Middle Park
project and the plaintiff's contention that the goods were
supplied on the basis of a revised quote of $233,162.94.
Similarly, it was submitted that there was a triable issue in
relation to the alleged $3,813.62 overcharge on the Mount
Tamborine project.

However, given that the plaintiff has approached this
application on the basis of the $181,072.82 quote for the
Middle Park project and on the basis that the alleged
overcharge is not subject of a claim for the Mount Tamborine
project, this gives rise to no triable issue for the purpose
of the judgment sought on this application.

Although Mr Ulrick concedes in argument before me that the
effect of the pleadings is that the view could be taken that
the delivery is admitted and the sum of $153,933.05 is owed by
the defendant to the plaintiff, this is not accepted on behalf
of the defendant.  He supports the defendant's position on the
basis of the proposition I have previously referred to, that
there are materials which were not delivered.  I have given my
reasons for rejecting this proposition.

Nonetheless, he submits there is sufficient material available
to me to decline relief.  He refers me to the final paragraph
of Mr Keating's affidavit denying that the sum of $192,539.64
(or any other sum) as alleged by the plaintiff (or at all) is
owing by the defendant to the plaintiff.  He also refers to
the alleged overcharging of $31,987.98 and the goods quoted
but not invoiced as set out in Schedule A.  He submits that
Schedule A shows a glaring omission as to proper invoicing and
argues that these also give rise to triable issues.

However, as I have already observed, the application is
brought on the basis of the quotes and excludes from the
claims the alleged overcharges and the goods which were quoted
but not invoiced.  Accordingly, these do not give rise to
triable issues for the purpose of this application. 

Rule 190 of the UCPR provides:
"(1) if an admission is made by a party, whether in a pleading
or otherwise, after the start of the proceeding, the Court
may, on the application of another party, make an order to
which the party applying is entitled on the admission.
(2) the Court may give judgment or make another order even
though other questions in the proceeding have not been
decided."

In respect of this aspect of the application, I agree with Mr
Evans' submissions that I have referred to and conclude the
effect of the defence is that on the basis of the defendant's
own admission it remains liable to the plaintiff in the amount
of $153,933.05 pursuant to Rule 190 and Rule 292 of the UCPR.
Subject to the counterclaim, the plaintiff would be entitled
to judgment in this amount.

For the reasons I have given in discussing Mr Ulrick's
submissions, the defendant has not established some real
prospect of succeeding at trial on this issue. 

Before I address the effect of the counterclaim on my ultimate
conclusion, I must consider the plaintiff's further argument
that it is entitled to judgment not only for this amount but
also for an additional sum of $31,997.98 for goods supplied
and delivered that were not part of the quotation.  The basis
of this submission is that, as I have already accepted, not
all of the disputed amounts referred to in the disputed
invoices relate to the differences between the prices of goods
supplied from that quoted.

A number of the disputes are with respect to quantities
delivered.  As I have concluded, where what are generally
relatively small differences between the prices of goods
supplied and quoted exist they effectively cancel each other
out and the sum of $31,997.98 relates to goods supplied which
were not part of the quotation.  This clearly emerges from an
analysis of Schedule A of the defence.  The submission for
convenience refers to invoice number 1260 of the schedule as
this is the first invoice referred to.  In relation to this,
it is stated that, "Nil quoted but invoiced 1." It is
shown that one item was delivered which was invoiced at
$2,346.84 (exclusive of GST).  This amount is then described
as a variation and then as the overcharge.  Therefore, it
relates to an item that was delivered but not included in the
quotation.  This is repeated on a number of other occasions
throughout the schedule.  Another example is invoice 1265
concerning "Misc various lighting" which is again "Nil quoted
but invoiced" with the variation recorded as $9,676.43.  The
total of the variations or overcharges in these circumstances
are $31,997.98.

It is submitted that nowhere in the defence, Mr Keating's
affidavit or the affidavit filed in support of the application
to set aside the statutory demand has the defendant ever taken
issue with it receiving and retaining the goods.  I note that
the second of the affidavits mentioned is not before me for
the purposes of this application.  Mr Evans submitted during
oral argument that it can be inferred they received and kept
these goods and pursuant to the credit application the
defendant is liable to the plaintiff for the price of these
items. 

Mr Ulrick's response is that in circumstances where
there is no quoted price, it would be expected that the price
for an item supplied and retained would be a fair and
reasonable price.  He also asserted that it would be expected
that there would be evidence to this effect and there is no
such evidence.

There are two relevant terms and conditions of sale attached
to the credit application made by the defendant to the
plaintiff and on the basis of which these goods have been
supplied.  These are:
"2 - Prices
The prices referred to herein are recommended prices only and
there is no obligation to comply with the recommendations.
All prices are subject to alteration without notice.
...
5 - Exchange or Return of Goods
Goods will not normally be accepted for exchange or return
after seven (7) days from date of delivery.  Any goods
accepted for exchange must be in saleable condition.  The
invoice number and date of sale must be advised.  Special
stainless steel and aluminium products are non-returnable."

Although these terms and conditions may apply to goods which
have been ordered on the basis of a quote, in my view, they
cannot be construed to apply to goods delivered on the basis
of a unilateral decision both to do so and to select a price
without an order made in response to a quote.  Such a
construction would be unfair to the person to whom the goods
were supplied, particularly in circumstances where the person
identifies an overcharge in relation to those goods.

In these circumstances, I agree with Mr Ulrick that it would
be expected that a fair and reasonable price would be charged
for the goods supplied to the defendant and retained by it
without an order made in response to a quote.  As he observed,
there is no evidence as to what is a fair and reasonable price
for these goods.  I consider this to be a triable issue which
I am not in a position to determine on this application.  In
the absence of such evidence, I am satisfied that the
defendant has established some real prospect of succeeding at
trial on this issue.  Therefore, I do not consider that the
plaintiff is entitled to summary judgment under Rule 292 in
the additional amount claimed.

However, as this is an alternative submission, I proceed to
determine this application on the basis that subject to the
counterclaim the plaintiff would be entitled to judgment in
the amount of $153,933.05.  I therefore turn to address the
effect of the counterclaim.

Mr Evans submits that the counterclaim is embarrassing as it
does not disclose any cause of action and should be struck out
pursuant to Rule 171 of the UCPR. Rule 171 provides:
"(1) this rule applies if a pleading or part of the pleading
discloses no reasonable cause of action or defence; or.
...
(2) the Court at any stage of the proceeding may strike out
all or part of the pleading and order the costs of the
application to be paid by a party calculated on the indemnity
basis.
...

"

The first issue which he addresses is the claim that a copy of
the statutory demand was provided to a supplier to the
defendant, Ideal Electrical.

As I have said, this is not expressly stated in the
counterclaim.  Paragraph 8 simply states that the defendant's
credit application was suspended by that company following the
issue of the statutory demand.  It is Mr Keating's affidavit
at paragraph 17 which swears to being informed by that
company's credit manager and that he believes that the
plaintiff sent or caused to be sent to it a copy of the demand
with the purpose of damaging the defendant's business.
Paragraph 18 then connects this to the immediate suspension of
the defendant's working account for the supply of electrical
equipment. 

Although I consider the information in paragraph 17 should have been included in the counterclaim, I consider that the fair and just resolution of the matter requires me to
proceed on the basis of the paragraph.  Mr Evans does not
argue against this approach on behalf of the plaintiff.  He
said in oral submissions that although the claim, a copy of
the statutory demand was provided to the supplier is denied by
the plaintiff, he was prepared to proceed on this basis for
the purpose of the application, that is, he conceded for the
purpose of the application that it is open to the Court to
find on the materials that it was provided to the supplier.
However, he submitted that even if this was proved, it would
not amount to a fraud on the plaintiff.

He submits that in order to succeed on a claim of fraud, the
defendant must show that the plaintiff was intentionally and
knowingly deceptive, although he concedes Mr Ulrick's
submission that reckless indifference to the truth could
constitute a fraud.  It is submitted that the matters set out
in paragraphs 9(a)-(d) of the counterclaim which are said to
amount to fraud, even if proved, would not be sufficient to
prove the intention on the part of the plaintiff to knowingly
deceive any party.  He extends the submission to the
plaintiff's acting with reckless indifference to the truth.

He submits that this allegation is hard to understand where
the defendant on its own case admits that it has at all times
been indebted to the plaintiff at least in the amount of
$153,933.05.

He asserts that whilst there might be some argument with
respect to a very small amount of the plaintiff's claim and,
in fact, less than $10,000, there is no prospect of succeeding
in showing that the plaintiff embarked on any intentional
deception and by logical extension of showing that the
plaintiff acted with reckless indifference to the truth.  It
is also submitted that to the extent the defendant claims any
conduct on the part of the plaintiff caused its loss, this is
not pleaded in an intelligible fashion nor particularised in
accordance with the requirements of the UCPR.

I proceed on the basis that the requirements of the UCPR
relied on are Rules 149 and 150.  So far as is relevant, Rule
149(1) provides:
"Each pleading must-
(a) be as brief as the nature of the case permits; and.
(b) contain a statement of the material facts on which the
party relies..."

Rule 150(1) requires fraud and breach of contract to be
specifically pleaded.  Rule 150(2) requires that any fact from
which any of the other matters mentioned in Subrule (1) is
claimed to be an inference must also be specifically pleaded.
In addition, Rule 157(1) requires a party to include in a
pleading particulars necessary to define the issues for, and
to prevent surprise at trial, enable the opposite party to
plead and support a matter specifically pleaded under Rule
150.

In relation to this, he submitted before me that the pleading
does not go far enough.  He argues that if an allegation of
fraud is going to be raised in the counterclaim, it should be
pleaded in the most fulsome fashion and it should plead the
material facts the defendant is going to rely on to say that
was done in a way that was reckless.  He asserts that there is
nothing in Mr Keating's affidavit as to any basis for such an
allegation to be made.  He also submits that it cannot be
established that the plaintiff has been knowingly deceitful
when there is enough on the materials to show he believed he
was entitled to the $192,539.64 claimed.

Mr Evans next addressed the other issue raised by the
defendant in support of its counterclaim.  This is an alleged
failure by the plaintiff to provide invoices in a timely
fashion thereby resulting in loss to the defendant.  The
submission relates to paragraphs 2 and 4A(vi)-(ix) of the
defence which are repeated and relied upon in the
counterclaim.  Reference is also made to this issue in
paragraphs 9(d) and 10(c) of the counterclaim.  Paragraph 2 of
the defence says it was an implied term of the counterclaim
that the plaintiff's tax invoices would be provided to the
defendant in a timely manner.  In paragraph 4A(vi)-(ix) five
invoices are identified which are alleged not to have been
provided to the defendant in a timely manner notwithstanding
the defendant's request for them on 10 November 2009 and
instead were provided under cover of an affidavit of the
plaintiff dated 18 February 2010.  It is said that this delay
has resulted in the defendant being unable to process final
payments with the builder for the Middle Park project and
that, "In the premises in relation to the Middle Park project
the plaintiff acted fraudulently or recklessly in not caring
whether the invoices matched the quotation provided and
providing false invoices late, thereby causing significant
delay to the defendant in processing true and accurate
accounts for payment and resulting in significant financial
loss to the defendant."

As I have previously observed, there is no claim by the
defendant that there was any delay in providing invoices for
the Mount Tamborine project. 

In paragraph 9(d) of the counterclaim, it is alleged that in relation to the issue and service of the statutory demand on the defendant, the plaintiff acted fraudulently in providing the invoices late.  In paragraph 10 the consequential financial loss the defendant alleges it suffered includes an inability to process final payments with its builder in relation to both projects.  It was stated that details of this loss would be provided prior to trial.  This has not yet occurred.

Mr Evans submits that the allegation, the supposed failure to
provide accounts in a timely manner resulted in loss to the
defendant is untenable.  For the purpose of this application,
he is prepared to proceed on the basis that it is open to the
Court to find that the plaintiff failed to provide invoices in
a timely fashion.  However, it is not conceded that this is an
implied term of the credit acceptance application.  His argument is that to the extent that the defendant seeks to rely on this, it is not pleaded in an intelligible way and he submits that matters which must be pleaded to imply such a term into a written contract are not pleaded at all.  He makes the point that there is no specific reference to this in the
counterclaim.  However, as I have observed, paragraph 2 of the
defence which pleads the implied term is repeated and relied
on for the purpose of the counterclaim.  However, he argues
that if the defendant wishes to imply this term into the
contract, a proper pleading that can be answered must be
provided, including matters such as the necessity of the term
and the business efficacy of the term.

Against this background, although it is accepted that the
defendant might be faced with some difficulties from receiving
the invoices late, there should be a proper pleading as to why
the term is to be implied and as to the material facts as to
the result of their not being provided in a timely fashion.
He submits that Mr Keating's affidavit also fails to address
this in an intelligible manner. 

Mr Evans also submits concerning the particular loss in paragraph 10(a) based on solicitor and own client legal costs in defending the statutory demand, those costs were dealt with by the consent order that there be no order as to costs.  In any event, he submits that this loss is also not properly pleaded, there being no issue about this raised in the pleading.

In conclusion, he submits that the pleading is highly
unsatisfactory in circumstances where it does not plead
material facts necessary to substantiate the relief that it
seems to seek on the basis of fraud.  He argues that it makes
no sense.  It is observed that despite this, the defendant has
not sought to amend the counterclaim. 

In his written submission, Mr Ulrick argues that the implied term of the contract that invoices be provided in a timely manner and would match the prices quoted is arguable on the terms of the credit application and Mr Keating's affidavit that it was important that accurate invoices be delivered properly.  He refers to Mr Keating's evidence that as a result of the plaintiff's failure to deliver goods as ordered and its
failure to deliver accurate invoices, the defendant ordered a large quantity of lighting equipment from Ideal Electrical. 

He places particular emphasis on the argument that on 20 January 2010 the plaintiff sent a false and inaccurate statutory demand.  This is a reference to the demand being for a total amount of $198,362.06 whereas the amount of debt calculated from the total of the individual invoices particularised was $234,972.58.
In conjunction with this, he stresses that on 29 January 2010,
the plaintiff curiously sent a monthly statement for the
precise amount of $198,362.06.  This is the statement of 21
January 2010 which is exhibited as "DEK-4".  Mr Ulrick
describes this as a statement for the precise amount as
appears in the statutory demand.  He told me that it is the
delivery of this statement that allows the inference of fraud
to be drawn.  He submitted orally that this gives rise to the
inference that the amount due and owing is wrong to the
plaintiff's knowledge.
In these circumstances, he argues that this is sufficient to
draw an inference that the statement was simply manufactured
to support the statutory demand as Mr Keating deposes he
believes to be the case and the plaintiff never truly believed
the invoice amounts.  As Mr Ulrick put it:
"They've put them in the statutory demand and they've just
come up with a figure of $198,000.  They don't believe it's
$230,000 and they've worked out their calculations to arrive
at that figure to give that figure to give the statutory
demand some support, and then wrongly abused their position by
sending a copy of this to a competitor to cease the
defendant's orders and in the scheme of things that's the sort
of matter that should be investigated at a trial."

This submission also relates to Mr Keating's evidence that the
plaintiff proceeded to cause a copy of the statutory demand to
be provided to Ideal Electrical.  As I have noted, Mr Evans
proceeds with this application on the basis that it is open to
the Court to find that this happened.  Mr Ulrick also relies
on Mr Keating's evidence that on the basis of his knowledge
and belief, this was done for the purpose of damaging the
defendant's business or, as Mr Ulrick puts it, it was sent
intending that Ideal Electrical would suspend the defendant's
working account which it did.  He submits that this conduct
has caused the defendant loss and damage to the extent of
$144,387.76 which is closely related to the complainant's
claim and it would be inequitable to consider the plaintiff's
claim without full consideration of it. 

He asserts that the claim in paragraph 9(d) of the counterclaim that the plaintiff acted fraudulently in providing the invoice late is based on breach of contract.  He submits that part of the cause of action in the counterclaim is based on breach of contract.

He also places reliance on what he refers to as "numerous
errors" in the invoices which he argues is sufficient to show
they are incorrect and intentionally incorrect.  Although he
accepts that while it may be unsatisfactory that particulars
which should have been provided of this loss caused by the
inability to process final payments with its builder for both
projects have not been provided, he contends one can see how
that sort of loss may arise.  He also accepts that
Mr Keating's affidavit does not fully address the importance
of the invoices being delivered promptly.  However, he argues
that it is sufficiently addressed to indicate the nature of
the case that the defendant is raising to show that moneys are
not due.  Nonetheless, he concedes that I am left to speculate
about the loss.

With reference to the particulars of the loss set out in
paragraph 9(a) of the counterclaim for $9,505 being solicitor
and own client legal costs in defending the statutory demand,
he argues that if the statutory demand is fraudulent, then
these costs have been occasioned as a result of that fraud.
He submits that in these circumstances the fact the parties
agreed to pay their own costs by virtue of the consent order
does not change it from being a loss the defendant incurred.
He reminded me of the general principle that issues raised in
the pleadings will be determined summarily only in the
clearest cases.  It was also submitted that if there is a
marginal gap in favour of the plaintiff in terms of money
owed, which in this case would be the difference between
$153,933.05 which I have found the plaintiff would be entitled
to judgment for subject to the counterclaim and $144,387.36
which is the loss the defendant is presently able to
particularise, it would be inequitable to issue a summary
judgment for this amount without full consideration of the
claim.

In reply, Mr Evans submitted that the plaintiff's statement
dated on 13 January 2010 (Exhibit DJVV-9) provides a very
clear and sensible explanation to Mr Ulrick's submission that
the statutory demand was delivered fraudulently.  This is said
to be the failure to show in the demand that the amount of
$234,972.58 which is calculated by adding the individual
invoice amounts is reduced to the total amount of $198,362.06
when the payments of $36,610.52 which are recorded in that
statement are deducted.  He submits that this amount has been
left out of the statutory demand through innocent error and
not as a matter of fraud even on the basis of reckless
indifference.  He also submits that the defendants have simply
failed to address the loss flowing from the late delivery of
invoices.  In conclusion, he observed that although perhaps a
complete redraft of the plaintiff's pleading could be done,
this opportunity has not been taken.

Mr Ulrick has accepted there are a number of difficulties with
the defendant's pleading in its current form.  I agree.  In
particular, I do not consider breach of contract has been
specifically pleaded as required by Rule 150(1)(a).  I also
agree with Mr Evans that if the defendant wishes to imply the
term of timely provision of the plaintiff's tax invoices into
the contract, material facts should be pleaded such as the
necessity of the term and the business efficacy of the term.
Further, the financial loss alleged to be suffered by the
defendant as the result of any such breach is not yet
particularised.

However, I do not consider that this issue is germane to the
resolution of the present application because, although
Mr Ulrick asserted that part of the cause of action in the
counterclaim is breach of contract, I have come to the
conclusion that as pleaded, the counterclaim alleges fraud.
This is apparent from the fact that after pleading the
material facts on which the defendant relies in paragraphs 1-8
of the counterclaim, including those from the defence which
are repeated and relied upon, the defendant pleads in
paragraph 9 that in the premises "in relation to the issue and
service of the statutory demand, the plaintiff acted
fraudulently."  The particulars of that fraud as I have
indicated include (a) in swearing/affirming an excessive debt
which was false to the knowledge of the plaintiff and (d) in
providing those invoices late.

The pleading then claims in the following paragraph that as a
consequence of the matters specified in the preceding
paragraphs which include the allegation of fraud, the
defendant has suffered financial loss and this financial loss
was further particularised as including (c) the suspension of
its credit application with its main supplier of electrical
components, Ideal Electrical.  This is the loss of $144,387.36
which is alleged in Mr Keating's evidence.

Although I agree with Mr Evans that the material facts in
support of this should have been pleaded more fulsomely, I do
not consider that the counterclaim is so bad in point of
pleading that it does not accord procedural fairness to the
plaintiff.  In particular, I do not consider it should be
struck out having regard to the applicable principles about
which McGill DCJ said in Kev Leamon Earthmovers Pty Ltd v
Hammond Village Pty Ltd (1998) 19 Qld Lawyer Reps 10-11:
"The party opposite is entitled to a proper pleading as an
incident of the requirement of procedural fairness.  A claim
or defence which is bad in point of pleading should be struck
out but on the basis that the party delivering it should be
given leave to re-plead.

As to the significance of striking out a pleading with leave
to re-plead on the ground that it was defective in point of
pleading, see Turner v Bulletin Newspaper Co Pty Ltd (1974)
131 CLR 69 at 74 per Barwick CJ; 97-98 per Jacobs J." (Other
citations omitted).

In my view, the defendant has sufficiently pleaded fraud for
the purposes of the counterclaim and despite Mr Evans'
submission about it being incomprehensible it is sufficiently
clear that he has been able to identify the issues for the
purpose of his submissions on this application.  As such, it
provides procedural fairness to the plaintiff.  In my view,
the counterclaim does identify a cause of action.  That cause
of action is fraud. 

Despite denying that the statutory demand was provided to Ideal Electrical and that the timely provision of invoices to the defendant was an implied term of the contract, Mr Evans has been prepared to argue the application on the basis that it is open to the Court to find on the materials that the demand was so provided to Ideal Electrical and it is also open to the Court to conclude that the plaintiff failed to provide the invoices in a timely manner.  Therefore, while recognising that there is an unresolved dispute about these issues, I proceed to determine the application on this basis.

It follows that in doing so I assume for the purposes of this
application that the statutory demand dated 19 January 2010
was not only filed and received by the defendant on 20 January
2010, but as deposed by Mr Keating was sent or caused to be
sent by the plaintiff to Ideal Electrical on or about 16
February 2010.  This statutory demand was, as Mr Ulrick puts
it, "glaringly inaccurate".  As I have said, although the
total amount due is said to be $198,362.07 an addition of the
actual amount of the debt itemised for each individual invoice
results in a total which is $36,610.52 more.  I consider that
this would have been evident to any person who received a copy
of the demand.

Mr Keating asserts that on the basis of the information
provided to him by the credit manager of Ideal Electrical,
this "glaringly inaccurate" demand was sent to that company
with the purpose of damaging the defendant's business.  Mr
Evans was not satisfactorily able to identify what I could consider to be a legitimate purpose for the plaintiff to provide the demand to the company.  His response to my question about this was:
"I understand the company that is one that deals with both -
was one of the companies that my client was sourcing goods to
which were being paid so there's a commercial relationship
between the plaintiff and this other company so it may have
been in the course of that.  I don't know that I can offer any
greater explanation other than there may have been some
discussion.  As I say, we don't concede that it was done."

Although Mr Evans submits that a comparison of the disparity
of $36,610.52 with the statutory demand is clearly and
sensibly explained as an innocent error through not
subtracting the same amount which is shown as a payment in the
13 January 2010 statement and this amount also appears as a
payment applied to invoice 1261 in the statement of claim,
there are discrepancies between the 13 January 2010 statement
and the 21 January 2010 statement (DEK-4).  For example, in
the 13 January statement, the $36,610.52 payment is shown as
having been credited on 3 December 2009.  In the 21 January
2010 statement the amount shown as credited on that date is
$50,000.  I appreciate that in the particulars to paragraph 6
of the statement of claim which is based on the reconciliation
statement (DJVV-12) the $50,000 is shown as being applied to a
number of different invoices with the $36,610.52 applied to
invoice 1261.  However, this is not how the sum appears in
DEK-4 and the 13 January 2010 statement does not itemise any
of the other applications.

In my view, this raises a real issue as to whether the
statement of 13 January 2010 was manufactured to support the
incorrect statutory demand and the plaintiff never truly
believed in the invoice amounts.  The failure to provide
invoices in a timely way is relevant to this.  As I have said,
Mr Evans concedes, despite Mr Van Vegchel's affidavit, that it
is open to the Court to conclude that they were not provided
to the defendant in a timely fashion.

In my view, it is also open to a Court, having regard to this
combination of circumstances, to conclude that this failure to
provide the invoices in a timely manner was because the
invoices were manufactured to support the incorrect
statutory demand, which is the belief deposed to by Mr Keating.

I also consider that it is open to a Court to conclude that
the only reason for sending the incorrect statutory demand to
Ideal Electrical was as Mr Keating deposes for the purpose of
damaging the plaintiff's business. 
At the very least, it is open to a Court to conclude that with this purpose in mind, the plaintiff was at least recklessly indifferent to the truth.  I consider that the interests of justice require that these issues be investigated at trial.

This is consistent with the counterclaim asserting that in
relation to the issue and service of the statutory demand, the
plaintiff acted fraudulently as particularised in paragraph 9
as a consequence of which the defendant suffered financial
loss from the suspension of its credit application with Ideal
Electrical, and this loss has been particularised as
$144,387.36.

Further, it would be open to a Court to conclude that $9,505
was a loss incurred in the expenditure of solicitor and own
client legal costs as a result of the fraud involved in the
issue of the statutory demand.  This is a total loss of
$153,895.36 which almost equals the judgment to which the
plaintiff would otherwise be entitled.

Accordingly, I am not satisfied that the counterclaim fails to
disclose a reasonable cause of action so as to give rise to my
discretion to strike out all or any part of it under Rule 171
of the UCPR. I am also satisfied that the defendant/respondent has established some real prospect of
succeeding on the counterclaim for an equivalent amount to the
judgment to which the plaintiff would otherwise be entitled on
the basis of the manner in which this application has been
conducted.  In these circumstances, the matter must go to
trial.

For completeness, even if I have not come to the view I have
expressed concerning the counterclaim for the loss of $9,505
given the relatively small difference between the quantum of
the judgment and what would then be the quantum of the
counterclaim to be set off against it, I would have exercised
my residual discretion to refuse summary judgment because I
consider that given the nature of the issues to be tried to
which the claim for this loss is integral, it would not be
fair and just to order summary judgment for the quantum of
this difference without full consideration of the claim as
Mr Ulrick has submitted.

In coming to this conclusion, after some considerable
deliberation, I have been conscious of the great care which is
required in deciding whether the power to order summary
judgment should be exercised as recognised by the High Court
of Australia in Fancourt v Mercantile Credits Ltd (1983) 154
CLR 87 at 89.  As Williams JA observed in Salcedo at [17] the
observations on summary judgment in that case are not
incompatible with the application of Rule 292.

I have also been conscious that as cited with approval by
McMurdo P at [3] the judges of the High Court in Agar v Hyde
(2000) 2001 CLR 552, 575-76 [57] said:
"The test to be applied has been expressed in various ways but
all of the verbal formulae which have been used are intended
to describe a high degree of certainty about the ultimate
outcome of the proceeding if it were allowed to go to trial in
the ordinary way." I consider this is applicable to the
formula in Rule 292. As McMurdo P also said in Salcedo at [3]
the issues raised in proceedings will be determined summarily
only in the clearest cases.  I do not consider that this is
such a case.

Before making my formal orders, I observe that this decision
should not be interpreted to mean that amendment of this
pleading by the defendant is unnecessary.  Accordingly, I
order the application be dismissed.

The question that arises is whether there is any issue of
costs that I have to determine in relation to the application.
...
HIS HONOUR:  This was an application that was brought by the
plaintiff to achieve two things: the first was that summary
judgment be entered in the plaintiff's favour and that the
counterclaim be struck out.  Ultimately, the
plaintiff/applicant has been unsuccessful on each of those
issues, and although I have concluded that there are some
deficiencies in the pleadings on behalf of the defendant and
although it may be as Mr Evans argues that the defendant/respondent can be said to had just fallen over the line in the sense that subject to the set-off available in the counterclaim, I considered that the plaintiff/applicant was entitled to judgment in this case.

It is nonetheless the case that the respondent has been
successful in resisting the application and I consider in the
circumstances there is no reason to depart from the rule that
costs should follow the event and therefore I order that the
plaintiff/applicant pay the defendant/respondent's costs of
and incidental to this application on the standard basis to be
assessed.

-----