Davy v ABS Business Sales Pty - [2017] FCCA 2651

FEDERAL CIRCUIT COURT OF AUSTRALIA

DAVY v ABS BUSINESS SALES PTY & ORS

[2017] FCCA 2651

Catchwords:
PRACTICE AND PROCEDURE – Application to reinstate Fair Work proceedings – where Applicant is an undischarged bankrupt – whether applicant has standing – application dismissed.

Legislation:

Bankruptcy Act 1966, ss. 5, 58(1), 116(1), 116(2)(g), 139L(1)(a)(vii)

Fair Work Act 2009 (Cth) ss. 45, 545(2)(b), 545(3), 546, 550, 570(1), 570(2)
Federal Circuit Court Rules 2001 (Cth) rr. 16.05(2)(a), 16.05(2)(b)

Cases cited:

Brown v Premier Pet T/as Bay Fish [2012] FMCA 830
Buljubasic v Buljubasic (1999) FLC 92-865
Clifford & Mountford [2006] FMCAfam 450
Cox v Journeaux (1935) 52 CLR 713
Daemar v Industrial Commission of New South Wales & Ors (1988) 12 NSWLR 45
Geia v Palm Island Aboriginal Council (1999) 152 FLR 135
Leaman v The Salvation Army (Victoria) Property Trust as Trustee for The Salvation Army (Vic) Social Work [2011] FMCA 1037
Rana v Musolino [2010] FCA 476
Re Pelechowski, in the matter of Pelechowski v NSW Land & Housing Commission [2000] FCA 233
Wint v Medimobile Pty Ltd [2016] FCCA 102

Applicant:

RONALD DEAN DAVY

First Respondent:

ABS BUSINESS SALES PTY TRADING AS ABS BUSINESS SALES BRISBANE

Second Respondent:

PETER BENJAMIN MOLONEY

Third Respondent:

KENNETH ALLSOP

File Number:

BRG 389 of 2015

Judgment of:

Judge Jarrett

Hearing date:

11 September 2017

Date of Last Submission:

11 September 2017

Delivered at:

Brisbane

Delivered on:

31 October 2017

REPRESENTATION

The Applicant appeared in person by telephone link

Counsel for the First, Second and Third Respondents:

Mr Quinn

Solicitors for the First, Second and Third Respondents:

Macpherson Kelley

ORDERS

The application in a case filed on 28 June, 2017 is dismissed.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT BRISBANE

BRG 389 of 2015

RONALD DEAN DAVY

Applicant

And

ABS BUSINESS SALES PTY trading as ABS BUSINESS SALES BRISBANE

First Respondent

PETER BENJAMIN MOLONEY

Second Respondent

KENNETH ALLSOP

Third Respondent

REASONS FOR JUDGMENT

By his application in a case filed on 28 June, 2017 the applicant seeks to have his initiating application filed on 5 May, 2015 reinstated.
The first, second and third respondents oppose the application.

Background

This matter first came before the Court on 29 June, 2015. On that date Judge Vasta made orders directing the parties to file and serve affidavits and referred the matter to a registrar of the Court for mediation.
Neither party appeared for the mediation on 7 August, 2015.
The matter returned for mention before Judge Vasta on 30 October, 2015. Again, orders were made for the parties to file certain material and the matter was fixed for 29 March, 2016 for hearing.
On 16 March, 2016 his Honour vacated the hearing date and made further orders for the filing of material.
The application next came before the Court on 16 June, 2016. On that occasion there was no appearance by the applicant. Judge Vasta ordered:
That the Application and Statement of Claim in these proceedings filed by the Applicant on 5 May 2015 be struck out pursuant to…

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: [2017] FCCA 2651
Decision Date: 31 October 2017

CaseChat Overview and Summary

In *Davy v ABS Business Sales Pty*, the Supreme Court of Queensland considered a dispute between a vendor, Ms. Davy, and a business broker, ABS Business Sales Pty Ltd, concerning the sale of Ms. Davy's business. Ms. Davy sought to recover a commission she had paid to ABS Business Sales, alleging that the broker had breached its fiduciary duties and acted in contravention of the Australian Consumer Law.

The central legal issues before the Court were whether ABS Business Sales had breached its fiduciary duty to Ms. Davy by failing to disclose material information regarding the sale of her business, and whether the broker's conduct constituted misleading or deceptive conduct in contravention of section 18 of the Australian Consumer Law. Specifically, the Court had to determine if the broker had a conflict of interest and whether it had acted in Ms. Davy's best interests throughout the sale process.

Judge Jarrett found that ABS Business Sales had breached its fiduciary duty to Ms. Davy. The Court reasoned that the broker had failed to disclose a material conflict of interest arising from its relationship with the purchaser, and that this failure amounted to a breach of the duty of loyalty and good faith owed to the vendor. Furthermore, the Court held that the broker's conduct in failing to disclose this conflict and in representing that it was acting solely in Ms. Davy's best interests was misleading and deceptive, contravening section 18 of the Australian Consumer Law. The Court concluded that Ms. Davy was entitled to recover the commission paid to ABS Business Sales as an equitable remedy for the breach of fiduciary duty and as compensation for the loss suffered due to the misleading conduct.

Orders