Clarke v Knobel

[2006] VSC 431

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

PRACTICE COURT

No. 9137 of 2004

ROGER STUART CLARKE	Plaintiff
v
MICHAEL  KNOBEL	Defendant

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JUDGE:	KAYE J
WHERE HELD:	Melbourne
DATE OF HEARING:	31 October 2006
DATE OF JUDGMENT:	31 October 2006
CASE MAY BE CITED AS:	Clarke v Knobel
MEDIUM NEUTRAL CITATION:	[2006] VSC 431

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PRACTICE – Application for summary judgment – Whether arguable defence – Whether contract made.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff/Respondent	Mr Pickering	Cornwall Stoddart
For the Defendant/Appellant	Mr Franzi	O’Haire Tanner Legal

HIS HONOUR:

1. This is an appeal from an order of Master Efthim made on 25 September in which the Master ordered that there be judgment for the plaintiff with damages to be assessed.  That order was made on a summons for final judgment brought in the proceedings by the plaintiff.

1. In the proceedings the plaintiff claims damages for breach of a contract of sale of land at 322 Cotham Road, Kew.  The contract bears the date 17 January 2003.  Under that contract the purchase price payable by the purchaser was $1.3 million, payable by a deposit bond of $100,000 by 20 January 2003 and the balance by 12 July 2003.  The defendant failed to pay the deposit and accordingly the contract in due course was terminated on 28 May 2003.  Subsequently the plaintiff re-sold the property for $930,000.  The plaintiff's claim for damages comprises, in the main, the difference between the contract price and the price achieved on the re-sale together with other costs and like matters.

1. The question which arises before me is whether the defendant has satisfied me that there is a question or questions in the proceeding which ought be tried pursuant to Order 22.06(1)(b) of the Rules of the Supreme Court.  In other words, the question is whether there is an arguable defence or an arguable response to the plaintiff's claim.  The authorities make it clear that the power to order summary or final judgment is one which must be exercised by the court with great care, and that it should never be exercised unless it is clear that there is no real question to be tried:  see Fancourt v Mercantile Credits Ltd;[1]  Duncan v Commonwealth Bank of Australia.[2] 

   [1](1983) 154 CLR 87 at 99.

   [2]Unreported, Court of Appeal, Victoria, Butterworth Cases 9605236, esp. at 8, per Winneke P.

1. In his answering material the defendant says that he is unable to recall signing the contract.  The defendant does not directly deny that he signed the contract, but he says he is unable to recall doing so and he attributes his lack of memory for that to the fact that at the time he was undergoing a lot of personal and business problems.  However, a report obtained on behalf of the defendant from Mr Neil Holland, a very experienced document examiner, has concluded that it is probable that the signatures on the contract are indeed the signatures of the defendant. 

1. Before me, Mr Franzi, who appeared on behalf of the defendant, submitted none the less that there is an arguable case which should go to trial on two main bases.  Firstly, he submitted that there is no evidence that a binding contract was entered into because there is no evidence that the contracts were exchanged between the parties.  Secondly, he has submitted that the report of Mr Holland shows that it is at least arguable that the contract has been fabricated.  As I understand what Mr Franzi was submitting, it is contended that there is an arguable case that parts of the contract have been inserted into it after the signature was put on it by the defendant, and that accordingly the contract relied on by the plaintiff is not the contract signed by the defendant.

1. In relation to the first matter, Mr Pickering, who appears on behalf of the plaintiff, has submitted that it is not always necessary that exchange of contracts occur.  In this case the plaintiff in his affidavit of 25 July 2006 has sworn at paragraph 5 that on 17 January 2003 he agreed to sell the property to the defendant for the sum of $1,300,000, and he has exhibited a true copy of the contract of sale.  That assertion is very much a matter of conclusion, but it has not been objected to.  In my view it is sufficient to encapsulate the making of a contract between the two parties;  in other words, to fulfil the requirements for a binding agreement.  Furthermore, at paragraph 15 of his affidavit, Mr Clarke has sworn that he is informed by his solicitor and believes that at 9.30 on 2 March 2003 the defendant telephoned the solicitors and stated that he wanted to proceed with the purchase of the property, he was not aware of the rescission, and that he asked for a further 24 hours to produce the deposit.  In my view, that telephone conversation is sufficient to constitute evidence of an admission by the defendant as to the making of the contract.  In his affidavit material the defendant has sworn that he does not recall that conversation but he does not deny, as I understand it, that it occurred. 

1. In those circumstances I do not consider that the first matter argued by Mr Franzi raises an arguable issue which is an issue to be tried in this case.

1. In relation to the second matter, Mr Franzi has relied on the report of Mr Holland.  In the course of that report Mr Holland has concluded on his examination of the contract that it in fact consists of photocopies taken from six separate documents and compiled together.  Mr Franzi drew my attention to page 5 of the contract, on which an old signature seems to have been photocopied on to the document.  Mr Franzi then took me to the conclusion of Mr Holland's report where, in paragraph 4(1), he states:  

"Although various pages of the contract Item 1 have come from other contracts and fitted into this contract and gives the appearance that the contract is false or fabricated, a complete examination of this document must be undertaken in my laboratory to determine whether or not this is a false or fabricated contract." 

Mr Franzi puts great emphasis on the reference by Mr Holland to the contract giving the appearance of being false or fabricated.  In response, Mr Pickering has drawn my attention, however, to the passage at page 2 of Mr Holland's report, at paragraph 2(b), where Mr Holland states:

"All pages of the contract are photocopies and some of these have original ink handwritten entries and signatures.  Each page has the same toner copier marks and some of these can be seen as the series of horizontal lines images 1, 5 and 6 near the base of each page.  This establishes that the pages of this contract have been produced on the same photocopier at the same time."

In my view, that passage undermines the part of the report relied on by Mr Franzi.  In other words, the evidence of Mr Holland is that all of the documents which are contained in the contract were produced on the same photocopier at the same time.  The passage at page 6 relied on by Mr Franzi means no more than the fact that there are six separate sources of the contract document may give the appearance to the document being false or fabricated, but that appearance, which is a matter of a layman's deduction, is subject to an examination which would need to be undertaken by the expert and has not been undertaken.  In those circumstances, I do not consider that the matters pointed to by Mr Franzi do give rise to a triable issue as to whether the document is indeed a fabrication.

1. For those reasons, I do not consider that the two matters relied upon by Mr Franzi do constitute a triable issue or an arguable defence on behalf of the defendant.  In reaching those conclusions I have borne in mind the principles which I have referred to earlier, namely, that the court does exercise its jurisdiction to enter final judgment with considerable care and only does so in cases which are clear.  The reason for that principle is long established.  These courts are courts in which matters between parties are tried, on oath, with both parties being subjected at trial to cross-examination.  Accordingly, courts are slow to enter judgment in cases other than where the issues are entirely clear. 

1. Bearing in mind that principle, I am none the less persuaded on the matters put before me that there is no arguable case on behalf of the defendant.  Accordingly, I conclude that the appropriate order is that the appeal from the order of Master Efthim made 25 September 2006 should be dismissed.

1. I order:

1.That the appeal by the defendant from the order of Master Efthim made 25 September 2006 be dismissed.

2.That the defendant pay the plaintiff's costs of the appeal including the costs which were reserved on 16 October 2006.

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