Cam and Bear Pty Ltd v McGoldrick - [2016] NSWSC 1894

Supreme Court

New South Wales

Summary available
Amendment notes

Medium Neutral Citation: Cam & Bear Pty Ltd v McGoldrick [2016] NSWSC 1894
Hearing dates: 3 – 5 March 2015, 9 April 2015, 12, 25 June 2015, 24 July 2015
Date of orders: 03 May 2017
Decision date: 03 May 2017
Jurisdiction: Common Law
Before: Rothman J
Decision:
(1) Judgment for the defendant;

(2) The plaintiff shall pay the defendant’s costs of and incidental to the proceedings, not previously covered by a costs order;

(3) The parties have liberty, within seven days, to make application for a different or special order as to costs by submission of no more than three pages in length, accompanied by any document upon which the application relies that is not otherwise in evidence. Any party affected by such application may respond within a further seven days by submission of no more than three pages in length, accompanied by any other document not otherwise in evidence;
(4) Proceedings dismissed.
Catchwords:
NEGLIGENCE – breach of duty by auditor – discussion of duty of auditor to self-managed superannuation fund – causation – breach of duty did not occasion loss – action dismissed;
TRADE PRACTICES – misleading or deceptive conduct – audit certificate represents fair state of affairs reported in financial statements – misleading and/or deceptive – no loss occasioned by misrepresentation.
Legislation Cited: Australian Consumer Law (NSW)
Australian Securities and Investments Commission Act 2001 (Cth)
Civil Liability Act 2002 (NSW)
Fair Trading Act 1987 (NSW)
Superannuation Industry (Supervision) Act 1993 (Cth)
Cases Cited: Adeels Palace Pty Ltd v Moubarak; Adeels Palace Pty Ltd v Bou Najem (2009) 239 CLR 420; [2009] HCA 48
Chappel v Hart (1998) 195 CLR 232; [1998] HCA 55
Dovuro Pty Limited v Wilkins (2003) 215 CLR 317; [2003] HCA 51
New South Wales v Fahy (2007) 232 CLR 486; [2007] HCA 20
Podrebersek v Australian Iron & Steel Pty Ltd (1985) 59 ALJR 492; [1985] HCA 34
Rosenberg v Percival (2001) 205 CLR 434; [2001] HCA 18
Strong v Woolworths Ltd (2012) 246 CLR 182; [2012] HCA 5
Vairy v Wyong Shire Council (2005) 223 CLR 422; [2005] HCA 62
Category: Principal judgment
Parties: Cam & Bear Pty Ltd ACN 139 844 741 (Plaintiff)
John McGoldrick (Defendant)
Representation:
Counsel:
G Drew / C Lee(Plaintiff)
P A Horvath / N Oreb (Defendant)
Solicitors:
Licardy & Company Lawyers (Plaintiff)
Esplin Solicitors (Defendant)

File Number(s): 2013/40165

Judgment

By Statement of Claim, the plaintiff, Cam & Bear Pty Ltd (“Cam & Bear”) sues the defendant, John McGoldrick (“Mr McGoldrick”) for damages. Essentially, the plaintiff is the corporate trustee of the Lance Bear Pty Ltd Superannuation Fund (“the Fund”) of which Mr McGoldrick, a qualified accountant and member of the Institute of Chartered Accountants, practising amongst other things as an auditor, was the auditor for the financial years ending 30 June 2003, 2004, 2005, 2006, 2007 and 2008.
The plaintiff alleges that the defendant breached his duty of care and/or…

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.

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Details

Case: [2016] NSWSC 1894
Decision Date: 03 May 2017

CaseChat Overview and Summary

Cam and Bear Pty Ltd, a company, brought a claim against McGoldrick, an auditor, for negligence and misleading or deceptive conduct in relation to an audit certificate. The matter was heard in the Supreme Court of Victoria. The dispute centred around the auditor's duty to a self-managed superannuation fund and whether the auditor's actions led to any loss for the company.

The court was tasked with determining whether the auditor breached their duty of care owed to the company and if such a breach caused any loss. Additionally, the court needed to examine whether the audit certificate, which stated that the financial statements presented a fair view of the company's financial position, was misleading or deceptive and whether this led to any loss for the company.

The court found that the auditor did not breach their duty of care, as the auditor's actions did not result in any loss for the company. Furthermore, the court held that the audit certificate did not mislead or deceive anyone, as it accurately reflected the company's financial position as reported in the financial statements. Consequently, the court dismissed the claim. The court found no basis for the company's claims and ruled that the auditor's actions did not cause any loss, thus the company's claims were unsuccessful.

Orders