Devon v Capital Finance Australia Ltd - [2014] FCA 1363

FEDERAL COURT OF AUSTRALIA
Devon v Capital Finance Australia Ltd [2014] FCA 1363

Citation: Devon v Capital Finance Australia Ltd [2014] FCA 1363

Parties: KATHLEEN LINDA DEVON v CAPITAL FINANCE AUSTRALIA LTD, AKYMAN INVESTMENTS PTY LTD and MARK NICOLAU

File number(s): VID 312 of 2014

Judge(s): DAVIES J

Date of judgment: 12 December 2014

Catchwords: PRACTICE AND PROCEDURE – Application for summary dismissal under r 26.01(1) of the Federal Court Rules 2011 (Cth) – whether claims were an abuse of process – whether principles of Anshun estoppel apply

Legislation: Competition and Consumer Act 2010 (Cth) Sch 2 ss 18 and 87
Corporations Act 2001 (Cth) s 1041H
Australian Securities and Investments Commission Act 2001 (Cth) ss 12DA, 12GM
Goods Act 1958 (Vic) ss 16, 17, 18, 19, 41
Federal Court Rules 2011 (Cth) r 26.01(1)

Cases cited: Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589; [1981] HCA 45
Wong v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 146 FCR 10; [2004] FCAFC 242
Young v Murphy (1994) 13 ACSR 722
Collie (As Trustee for the Terracol Trust) v Merlaw Nominees Pty Ltd [1998] VSC 203
Propell National Valuers (WA) Pty Ltd v Australian Executor Trustees Limited [2012] FCAFC 31
Macchia v Nilant (Trustee) [2006] FCA 213

Date of hearing: 28 November 2014

Place: Melbourne

Division: GENERAL DIVISION

Category: Catchwords

Number of paragraphs: 16

Counsel for the Applicant: The applicant’s husband, Mr Devon, appeared on behalf of the applicant, with leave

Counsel for the Respondents: Mr M Koroneos

Solicitor for the Respondents: Koroneos Lawyers

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

GENERAL DIVISION

VID 312 of 2014

BETWEEN:
KATHLEEN LINDA DEVON
Applicant

AND:
CAPITAL FINANCE AUSTRALIA LTD
First Respondent

AKYMAN INVESTMENTS PTY LTD
Second Respondent

MARK NICOLAU
Third Respondent

JUDGE:

DAVIES J

DATE OF ORDER:

12 DECEMBER 2014

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT:
1.The proceeding against the first respondent be dismissed pursuant to r 26.01(1) of the Federal Court Rules 2011 (Cth).
2.The applicant pay the first respondent’s costs of the proceeding, including all reserved costs, such costs to be taxed in default of agreement.
3.The applicant’s application for leave to issue a subpoena to the third respondent is refused.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

GENERAL DIVISION

VID 312 of 2014

BETWEEN:
KATHLEEN LINDA DEVON
Applicant

AND:
CAPITAL FINANCE AUSTRALIA LTD
First Respondent

AKYMAN INVESTMENTS PTY LTD
Second Respondent

MARK NICOLAU
Third Respondent

JUDGE:

DAVIES J

DATE:

12 DECEMBER 2014

PLACE:

MELBOURNE

REASONS FOR JUDGMENT

The first respondent (“Capital Finance”) has applied to dismiss the claims made by the applicant (“Mrs Devon”) against it in this proceeding: (1) as an abuse of process on the ground that the principles of Anshun estoppel apply with respect to those claims; (2) on the ground that Mrs Devon does not have standing to sue on those claims.…

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: [2014] FCA 1363
Decision Date: 12 December 2014

CaseChat Overview and Summary

Devon v Capital Finance Australia Ltd concerned a legal dispute between Mrs Devon and Capital Finance Australia Ltd, with Akyman and Mr Nicolau also involved. The case originated from a County Court decision in 2013, where judgment was given in favour of Capital Finance against Mrs Devon for a sum of $118,975.61, which included the principal amount and interest. Mrs Devon appealed the County Court's decision to the Supreme Court of Victoria, which dismissed her appeal in April 2014. Subsequently, in June 2014, Mrs Devon initiated proceedings in the Federal Court of Australia against Capital Finance, Akyman, and Mr Nicolau. Her claims were based on several allegations, including breach of contract, breach of duty, representation, estoppel, and false and misleading conduct under various Australian laws.

The primary legal issues before the court were whether Mrs Devon's claims were an abuse of process and whether the principles of Anshun estoppel applied to prevent her from raising certain matters in the Federal Court proceedings. The court had to determine whether Mrs Devon's claims were an abuse of the court's process and if she was estopped from pursuing certain allegations that she had already litigated or could have litigated in the County Court proceedings. The court also needed to decide if the Anshun estoppel principles, which prevent a party from relitigating an issue that could have been raised in a prior proceeding, were applicable to the claims made by Mrs Devon.

In resolving these issues, the court found that Mrs Devon's claims were indeed an abuse of process. It held that the matters she sought to raise in the Federal Court had already been decided or were available to be raised in the County Court proceedings. The court further determined that the principles of Anshun estoppel applied, barring Mrs Devon from re-litigating these claims. Consequently, the court dismissed the proceeding against the first respondent and ordered Mrs Devon to pay Capital Finance's costs of the proceeding. Additionally, Mrs Devon's application for leave to issue a subpoena to the third respondent was refused.

In summary, the Federal Court of Australia dismissed Mrs Devon's claims against Capital Finance, finding them to be an abuse of process and applying the principles of Anshun estoppel. The court ordered Mrs Devon to pay Capital Finance's costs and refused her application for leave to issue a subpoena to Mr Nicolau.

Orders

Orders of the court

1. The proceeding against the first respondent be dismissed pursuant to r 26.01(1) of the Federal Court Rules 2011 (Cth).

2. The applicant pay the first respondent’s costs of the proceeding, including all reserved costs, such costs to be taxed in default of agreement.

3. The applicant’s application for leave to issue a subpoena to the third respondent is refused.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

A trial was held in September 2013 and in October 2013 the County Court gave judgment for Capital Finance against Mrs Devon in the sum of $118,975,61, comprising the principle amount of $101,774.11 plus interest, and ordered Mrs Devon to pay Capital Finance’s costs. Mrs Devon appealed that decision to the Court of Appeal of the Supreme Court of Victoria which, in April 2014, dismissed her appeal. In June 2014, Mrs Devon commenced proceedings in the Federal Court of Australia against Capital Finance, Akyman and Mr Nicolau.FURTHER BACKGROUND In the County Court action, Mrs Devon’s third amended defence made several positive allegations against Capital Finance by way of defence to the debt claim against her based on the guarantee and indemnity. The allegations included that:(a)It was a term of the term purchase agreement that Capital Finance would not pay the settlement proceeds to Akyman until Melbourne South had approved the inspection and notified Capital Finance that the equipment was ready for collection (“the further term”);(b)The equipment to be supplied by Akyman was not fit for the purpose or of merchantable quality. The particulars included that Mr Devon had inspected the equipment at the offices of Akyman and discovered that the computer and other equipment being supplied was not new as agreed but second hand and in poor condition; and(c)By reason that the equipment to be supplied by Akyman was not fit for the purpose or of merchantable quality, Melbourne South cancelled the contract. These allegations founded claims by Mrs Devon by way of defence:(a)In breach of the further term, Capital Finance released the settlement sum to Akyman without advice from Melbourne South that the equipment was ready for collection (“the breach of contract claim”);(b)Capital Finance, in providing finance to Melbourne South, owed Mrs Devon a duty to take reasonable care in the provision of such services and in breach of its duties to her, Capital Finance released the settlement sum to Akyman: (1) without advising Melbourne South or her; (2) without obtaining written confirmation from Melbourne South that the goods were fit for the purpose or of merchantable quality; and (3) did not comply with the settlement checklist according to the conditions contained in the offer of finance by failing to receive payment of the initial instalment prior to settlement (“the breach of duty claim”);(c)Capital Finance represented to Mrs Devon that the settlement sum would only be released to Akyman upon advice from Melbourne South that the equipment was ready for collection (“the representation”), that Mrs Devon, induced by and in reliance on the representation continued to provide a guarantee and indemnity for and on behalf of Melbourne South and Capital Finance was estopped from claiming the settlement sum from Mrs Devon (“the estoppel claim”);(d)The offer by Melbourne South included the further term and Capital Finance’s acceptance of the term purchase agreement on some other basis did not constitute proper acceptance of that offer (“the no contract claim”); and(e)By reason of the representation Capital Finance engaged in conduct that was false and misleading in breach of s 18 of the Australian Consumer Law (Competition and Consumer Act 2010 (Cth) Sch 2) (“the Australian Consumer Law”), s 1041H of the Corporations Act 2001 (Cth) and s 12DA of the Australian Securities and Investments Commission Act 2001 (Cth) (“the ASIC Act”), and Mrs Devon was entitled to have the term purchase agreement declared void under s 87 of the Australian Consumer Law and s 12GM of the ASIC Act.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

Citation:	Devon v Capital Finance Australia Ltd [2014] FCA 1363
Parties:	KATHLEEN LINDA DEVON v CAPITAL FINANCE AUSTRALIA LTD, AKYMAN INVESTMENTS PTY LTD and MARK NICOLAU
File number(s):	VID 312 of 2014
Judge(s):	DAVIES J
Date of judgment:	12 December 2014
Catchwords:	PRACTICE AND PROCEDURE – Application for summary dismissal under r 26.01(1) of the Federal Court Rules 2011 (Cth) – whether claims were an abuse of process – whether principles of Anshun estoppel apply
Legislation:	Competition and Consumer Act 2010 (Cth) Sch 2 ss 18 and 87 Corporations Act 2001 (Cth) s 1041H Australian Securities and Investments Commission Act 2001 (Cth) ss 12DA, 12GM Goods Act 1958 (Vic) ss 16, 17, 18, 19, 41 Federal Court Rules 2011 (Cth) r 26.01(1)
Cases cited:	Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589; [1981] HCA 45 Wong v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 146 FCR 10; [2004] FCAFC 242 Young v Murphy (1994) 13 ACSR 722 Collie (As Trustee for the Terracol Trust) v Merlaw Nominees Pty Ltd [1998] VSC 203 Propell National Valuers (WA) Pty Ltd v Australian Executor Trustees Limited [2012] FCAFC 31 Macchia v Nilant (Trustee) [2006] FCA 213
Date of hearing:	28 November 2014
Place:	Melbourne
Division:	GENERAL DIVISION
Category:	Catchwords
Number of paragraphs:	16
Counsel for the Applicant:	The applicant’s husband, Mr Devon, appeared on behalf of the applicant, with leave
Counsel for the Respondents:	Mr M Koroneos
Solicitor for the Respondents:	Koroneos Lawyers

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION	VID 312 of 2014

JUDGE:	DAVIES J
DATE OF ORDER:	12 DECEMBER 2014
WHERE MADE:	MELBOURNE

JUDGE:	DAVIES J
DATE:	12 DECEMBER 2014
PLACE:	MELBOURNE