Bunt v Nati - [2012] FCA 1089

FEDERAL COURT OF AUSTRALIA
Bunt v Nati [2012] FCA 1089

Citation: Bunt v Nati [2012] FCA 1089

Parties: GREGORY JOHN BUNT v ROBERT NATI and YING JIA (JASON) DAI

File number: NSD 1633 of 2008

Judge: EMMETT J

Date of judgment: 6 September 2012

Legislation: Corporations Act 2001 (Cth) ss 601AB(3), 1274B(2)
Fair Trading Act 1987 (NSW)
Federal Court of Australia Act 1976 (Cth) s 51A
Trade Practices Act 1974 (Cth)

Cases cited: Kestrel Holdings Pty Limited v APF Properties Pty Limited (2009) 260 ALR 418
Management 3 Group Pty Limited v Lenny’s Commercial Kitchens Pty Limited (2012) 289 ALR 275

Date of hearing: 3 – 6 September 2012

Date of last submissions: 12 September 2012

Place: Sydney

Division: GENERAL DIVISION

Category: No catchwords

Number of paragraphs: 97

Counsel for the applicant: M Condon

Solicitor for the applicant: Price & Company

Counsel for the first respondent: B Guzzo

Solicitor for the first respondent: Doherty and Colleagues

Counsel for the second respondent: CM Lawrence

Solicitor for the second respondent: Ren Zhou Lawyers

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

GENERAL DIVISION

NSD 1633 of 2008

BETWEEN:
GREGORY JOHN BUNT
Applicant

AND:
ROBERT NATI
Respondent

JUDGE:

EMMETT J

DATE OF ORDER:

21 SEPTEMBER 2012

WHERE MADE:

SYDNEY

THE COURT:
1.ORDERS THAT, on the applicant’s claim founded on total failure of consideration:
1.1there be judgment in favour of the applicant against the first respondent in the sum of $573,809.02, which includes interest on the sum of $375,000 pursuant to s 51A of the Federal Court of Australia Act 1976, in the sum of $198,809.02, calculated up to and including 21 September 2012 as specified in Schedule 2;

1.2there be judgment in favour of the applicant against the second respondent in the sum of $573,809.02, which includes interest on the sum of $375,000 pursuant to s 51A of the Federal Court of Australia Act 1976, in the sum of $198,809.02, calculated up to and including 21 September 2012 as specified in Schedule 2.

2.NOTES THAT the obligations of the first respondent under order 1.1 above and the obligations of the second respondent under order 1.2 above are several.
3.ORDERS THAT the applicant’s amended application be otherwise dismissed.
4.ORDERS THAT that the first and second respondents pay the applicant’s costs of and incidental to the proceedings, including any reserved costs.

5.ORDERS THAT, pursuant to Rule 36.03(b) of the Federal Court Rules, any notice of appeal is to be filed on or before 31 October 2012.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

GENERAL DIVISION

NSD 1633 of 2008

BETWEEN:
GREGORY JOHN BUNT
Applicant

AND:
ROBERT NATI
Respondent

JUDGE:

EMMETT J

DATE:

6 SEPTEMBER 2012

PLACE:

SYDNEY

REASONS FOR JUDGMENT

This proceeding arises out of arrangements entered into between the applicant, Mr Gregory Bunt, on the one hand, and the first respondent, Mr Robert Nati,…

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 Bunt v Nati

Details

AGLC: Bunt v Nati [2012] FCA 1089
Case: [2012] FCA 1089
Decision Date: 6 September 2012

CaseChat Overview and Summary

This proceeding concerns arrangements entered into between the applicant, Mr Gregory Bunt, and the first and second respondents, Mr Robert Nati and Mr Jason Dai, in relation to the affairs of Rowa Australia Pty Limited (Rowa), which has since been deregistered. Mr Bunt alleges that he is entitled to a refund of $750,000 that he paid to Rowa in August 2004 on the basis that there was a total failure of consideration for the purchase of 20 per cent of the issued shares in Rowa. Alternatively, Mr Bunt claims that the first and second respondents engaged in misleading and deceptive conduct in contravention of the Trade Practices Act 1974 (Cth). The first and second respondents deny that they engaged in misleading and deceptive conduct and assert that there was no failure of consideration, in that they gave Mr Bunt a 20 per cent interest in Rowa. The first and second respondents rely on documents that purport to show that 25 shares were issued to Mr Bunt on 11 August 2004. There is, however, ample evidence to establish that the documents are false. There is no doubt that Mr Bunt paid $750,000 to Rowa in August 2004 as consideration for the acquisition of 20 per cent of the share capital of Rowa. No transfer or allotment of any kind was ever effected. It follows that, at the time of its deregistration, if there were a register of members, it would have shown that the only shareholders were Mr Nati and Mr Dai, and that each held one share. It follows, in my view, that while Mr Bunt paid $750,000 as consideration for the acquisition of 20 per cent of the share capital of Rowa, whether by way of transfer or by allotment, that consideration has failed totally. Mr Bunt is entitled to recover the sum of $750,000 paid by him to Rowa at the direction of Messrs Nati and Dai as consideration for the transfer of shares in Rowa. It is clear that, at the time when the payments were made, there had been no suggestion made of any allotment of shares. The payments must be treated as payments to Messrs Dai and Nati, which they directed to be paid to Rowa. Be that as it may, it follows that there should be judgment for Mr Bunt against each of Messrs Nati and Dai in the sum of $375,000. Judgment should be entered against each of Mr Nati and Mr Dai in the sum of $375,000 plus interest at the relevant rate under s 51A of the Federal Court of Australia Act 1976 (Cth), less one half of the sum of $186,164.47.

Orders