Coral Bay Beach House Estate Developments Pty Ltd v Barfield
[2016] WADC 54
•19 APRIL 2016
CORAL BAY BEACH HOUSE ESTATE DEVELOPMENTS PTY LTD -v- BARFIELD [2016] WADC 54
| DISTRICT COURT OF WESTERN AUSTRALIA | Citation No: | [2016] WADC 54 | |
| Case No: | CIV:3971/2015 | 30 MARCH 2016 | |
| Coram: | DEPUTY REGISTRAR HEWITT | 19/04/16 | |
| PERTH | |||
| 6 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| PDF Version |
| Parties: | CORAL BAY BEACH HOUSE ESTATE DEVELOPMENTS PTY LTD DONALD HORACE BARFIELD |
Catchwords: | Practice and procedure Summary judgment application Turns on its own facts |
Legislation: | Nil |
Case References: | Nil |
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
- IN CIVIL
- Plaintiff
AND
DONALD HORACE BARFIELD
Defendant
Catchwords:
Practice and procedure - Summary judgment application - Turns on its own facts
Legislation:
Nil
Result:
Application dismissed
Representation:
Counsel:
Plaintiff : Mr R Rowick
Defendant : Dr J T Schoombee
Solicitors:
Plaintiff : Richard Rowick
Defendant : Sonia Edwards Legal
Case(s) referred to in judgment(s):
1 DEPUTY REGISTRAR HEWITT: In this matter the plaintiff, the defendant and a number of others hold leasehold interests in lots at a development called Beach House Estate in Coral Bay in the Exmouth area of Western Australia.
2 It was the wish of the various leaseholders to obtain certificates of title for the land which they occupied. As a consequence of that desire a Supreme Court action was commenced by one of the lessees namely Dr Ben Williams. That action was settled and as a consequence of that settlement Dr Williams was authorised to proceed with the relevant subdivision of the land and he did so using the services of a company Coral Bay Beach House Estate Developments Pty Ltd. Subsequently there was further friction with the lessor leading to another Supreme Court action and another settlement. That settlement imposed a condition upon the subdivision of the land namely that each of the relevant owners would execute a deed poll in the form exhibited to the deed of settlement the effect of which was to provide some protection to the lessor. The deed of settlement made the execution of these documents a condition precedent to the deed of settlement itself.
3 At an earlier stage in 2012, relying on the authority which had been granted to him in the first settlement, Dr Williams engaged the services of Coral Bay Beach House Estate Pty Ltd to undertake the necessary subdivision and matters related to that subdivision and to take contributions from the various lessees to fund that process. Each of the lessees entered a deed with the company which formalised the arrangements for the contribution of each towards the expenses of the subdivision. That document forms the basis upon which the plaintiff has brought this action. In its essence the action alleges that the defendant has failed to pay his contribution towards the subdivision of costs and that is the basis upon which he is sued. Since the writ was issued the defendant has paid the capital sum pursued by the plaintiff in the writ and two other amounts in addition part of which at least is said to be a contribution towards interest payable as a consequence of late payment.
4 Certain matters are clear and not in dispute. The first matter which is clear is that the relevant deed requiring the plaintiff to make certain payments exists and was executed by all the relevant parties. It is also clear that the plaintiff did not pay various levies which he was required to pay by the plaintiff until a date after the commencement of this action. The real issues which are raised for determination are:
1. Whether the plaintiff is the correct plaintiff, the proposition being that the correct plaintiff should be Dr Williams;
2. If interest is payable at what rate is it payable;
3. Has the defendant succeeded in limiting his potential contribution to a total of $340,000; and
4. Whether the plaintiff is entitled to damages.
5 The first contention is that the plaintiff is not the proper plaintiff. In my view that contention founders on the basis that the defendant has executed a deed promising to pay the monies which were from time to time levied against him those being a proportion of the total monies pooled by the plaintiff for the purposes I have described. In my view the deed makes it perfectly clear that the plaintiff is a proper plaintiff. True it is that the plaintiff is acting in a role assigned to him by Dr Williams. Nonetheless in carrying out those tasks the plaintiff has entered a binding agreement with all of the lessees of the relevant lots. The terms of the agreement make it clear that the company is entitled to enforce the terms of agreement. In that regard I refer to cl 20.4 of the agreement which is in the following terms:
Each Shareholder acknowledges and agrees that any breach of the Funding Obligation by a Shareholder ('Defaulting Shareholder') will cause loss or damage to the Company and each and every other Shareholder. ('Non-Defaulting Shareholder'), and accordingly, any breach of the funding obligation may be enforced (or damages sought) by the Company or the non-defaulting Shareholder by legal action against the defaulting Shareholder. This right is an addition to any other right that the Company or a Shareholder may have under this Agreement.
6 Additionally it seems to me that the defendant has lost any opportunity to run this argument since he has paid the amount of contributions the subject of the plaintiff's action together with some contribution towards interest on those sums. In my view the defendant is estopped from asserting, having made those payments, that in truth the plaintiff has no right to enforce the payment of the monies or to recover interest in respect of non-payment.
7 The next issue is the question of interest. Under the terms of the agreement 'interest rate' means a rate of interest per annum which is 3 percentage points higher than the rate expressed as a percentage per annum charged by the Commonwealth Bank of Australia on overdraft accounts in excess of $100,000. Evidence has been advanced in support of the application which supports the proposition that the interest claimed of 11.88%, although an approximation, is such that the court can be confident that the figure is lower than that which might be obtained if the information were analysed on a day by day basis. That is certainly true if the interest rate quoted is an appropriate interest rate. The contention is that it is not. The evidence establishes that the interest rate is a corporate business rate on overdraft accounts. There is nothing in the document which mentions anything about corporate interest rates. Overdraft accounts exist in many forms and I would have thought as a matter of interpretation the interest rate should be the lowest interest rate which is offered by the Commonwealth Bank of Australia on overdrafts in excess of $100,000, provided however, that no special conditions are attached to the accounts such as provision of a mortgage or other form of security or something of that kind. It may of course not be possible to procure an overdraft without the provision of some security, there is no evidence before me on that score. I therefore take the point that there is some doubt as to whether or not the interests rates sought to be applied by the plaintiff is in fact the correct interest rate but I additionally note that the defendant has paid sums over and above the levied contributions and those sums together fall only marginally short of the interest which is claimed by the plaintiff. On the question of interest I consider that there is a triable issue. The evidence which is presented is not comprehensive and not necessarily correct.
8 The next issue which is raised concerns the execution of a deed poll by the defendant. The defendant contends that he executed that deed poll, which as far as I can see he was not obliged to do, on the basis that his liability under the subdivision arrangements would not exceed $340,000 ($170,000 for each lot). That condition was made known to the solicitor acting for the plaintiff (and also Dr Williams) by a letter dated 23 April 2015 which was delivered at the same time as the executed deed poll. Having received the executed deed poll together with the relevant letter it seems to me the plaintiff could only use it (as it has done) on the terms upon which it was given. That was the matter for the decision of the plaintiff and indirectly Dr Williams. By using the deed poll to satisfy the condition precedent of the agreement which was entered between Dr Williams and the lessor of the land I think it an arguable proposition that both are bound to honour the terms upon which the document was made available. To simply ignore the terms upon which the deed poll was made available in my view would grant a remedy to the defendant however that is not relevant in the present circumstances because by his actions the defendant has conceded that if interest is properly payable it would be over and above the cap which he contends is in place. Whilst therefore the existence of a cap may well be a defence to further levies it is not a defence to the present claim.
9 The final matter which arises is the plaintiff's claim for damages. As I have earlier indicated the plaintiff is entitled to bring an action against a defaulting lessee for failing to pay a levy imposed upon him where that failure has created damage. The statement of claim claims damages but the statement of claim is completely silent as to what those damages might comprise. The materials within the affidavit in support suggests that they might be for legal fees but that is hardly relevant. Before a summary judgment can be granted it is necessary for a proper pleading to exist. In this case no such pleading exists. Therefore no summary judgment is available on the issue of damages whether to be assessed or otherwise.
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