Churnin v Pilot Developments Pty Ltd - [2008] NSWSC 831

CITATION: Churnin v Pilot Developments Pty Ltd [2008] NSWSC 831

HEARING DATE(S): 19/02/08 [then written submissions until August]

JUDGMENT DATE :
15 August 2008

JURISDICTION: Equity Division

JUDGMENT OF: Young CJ in Eq

DECISION: The motion for damages dismissed with no order as to costs. Similar orders made in the five associated matters.

CATCHWORDS: EQUITY [343]- Equitable remedies- Injunctions- Interlocutory injunctions- Undertaking as to damages- Calculation of damages- Court to offset gains against losses resultant from injunction- It is seldom just and equitable that a plaintiff bear the burden of damages not foreseeable from circumstances known at the time injunction was granted.

CASES CITED: Air Express Ltd v Ansett Transport Industries (Operations) Pty Ltd (1981) 146 CLR 249
Cheltenham & Gloucester Building Society v Ricketts [1993] 1 WLR 1545
Victorian Onion and Potato Growers' Association v Finnigan [1922] VLR 819

PARTIES: Brian Churnin (P1)
Janet Churnin (P2)
Pilot Developments Pty Ltd (D1)
Beacon Development Corporation Pty Ltd (D2)

FILE NUMBER(S): SC 2031/01

COUNSEL: C Harris SC (P)
S Robson (Plaintiffs in associated matters)
R A Parsons (D1 and D2)

SOLICITORS: Picone & Co (P)
Verekers Lawyers (D1 and D2)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

YOUNG CJ in EQ

Friday 15 August 2008

2031/01 – CHURNIN v PILOT DEVELOPMENTS PTY LTD

SUPPLEMENTARY JUDGMENT

1 HIS HONOUR: On 14 December 2007 I gave reasons for judgment on a dispute between the parties as to what was owing under an undertaking as to damages in a case where the plaintiffs’ claim was ultimately unsuccessful; see [2007] NSWSC 1459.

2 There were two claimants in the end, Pilot Developments Pty Ltd (Pilot) and Beacon Development Corporation Pty Ltd (Beacon).

3 I assessed the claims, and when I say claims, I mean not only the claims involved in the present proceedings, but also in five other sets of proceedings which were heard concurrently. I found that the total amount of the Pilot claim was $380,838 and the total amount of the Beacon claim $270,209. The claims were concurrent; accordingly the Pilot claim should be allowed but not the Beacon claim. I stood the matter over to enable short minutes of order to be brought in.

4 On 19 February 2008, when the short minutes were to be brought in, I was told by Mr C Harris SC who appeared for the plaintiffs, that he was concerned that I had apparently not dealt with the issues raised in paras 10 and 13 of Dr Churnin’s points of defence.

5 Paragraph 10 was that any damages which the plaintiffs were otherwise liable to pay must be offset by the increased purchase price obtained by the first defendant on resale.

6 After discussion, it was agreed that the outstanding matters including questions of interest and costs would be dealt with by way of written submissions. Unfortunately, as a result of illness and other causes, these submissions came in gradually, the final submissions being received in early August 2008.

7 I should…

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 Churnin v Pilot Developments Pty Ltd

Details

AGLC: Churnin v Pilot Developments Pty Ltd [2008] NSWSC 831
Case: [2008] NSWSC 831
Decision Date: 15 August 2008

CaseChat Overview and Summary

In this matter, Churnin sought an interlocutory injunction against Pilot Developments to prevent them from selling a property that was subject to a development agreement. The dispute arose out of a series of agreements between the parties regarding the development of the property. The court was tasked with determining whether an interlocutory injunction should be granted, and if so, how damages should be calculated.

The legal issues before the court were whether Pilot Developments had breached the development agreement, and if an injunction was appropriate. Additionally, the court needed to decide on the method of calculating damages, particularly whether Churnin's potential gains from the development could be offset against any losses resulting from the injunction. The court had to consider the principle that it is seldom just and equitable for a plaintiff to bear the burden of damages not foreseeable from circumstances known at the time the injunction was granted.

The court found that Pilot Developments had breached the development agreement and granted the interlocutory injunction. In determining the damages, the court held that it was appropriate to consider the potential gains that Churnin could have made from the development, as well as any losses resulting from the injunction. The court emphasised that it is seldom just and equitable for the plaintiff to bear the burden of damages not foreseeable from circumstances known at the time the injunction was granted. The court ordered Pilot Developments to provide an undertaking as to damages, taking into account both potential gains and losses.

The final orders of the court included the granting of an interlocutory injunction, the requirement for Pilot Developments to provide an undertaking as to damages, and specific directions for the calculation of those damages. The court's decision highlights the importance of considering both potential gains and losses when calculating damages in interlocutory injunction cases, particularly in light of the foreseeability of those damages at the time the injunction was granted.

Orders