Downing v MNSBJ Pty Ltd - [2018] QCA 223

SUPREME COURT OF QUEENSLAND

CITATION:

Downing v MNSBJ Pty Ltd & Ors [2018] QCA 223

PARTIES:

ARTHUR CHARLES DOWNING
(appellant)
v
MNSBJ PTY LTD
ACN 144 779 448
(first respondent)
FRESH WATER FROFFERS PTY LTD
ACN 169 204 933
(second respondent)
JOHN SULLIVAN
(third respondent)
NICHOLAS JOEL GIBBIE
(fourth respondent)
TAMMIE ANNE GIBBIE
(fifth respondent)
GILES IVOR WAKFIELD
(sixth respondent)

FILE NO/S:

Appeal No 3317 of 2017
DC No 3903 of 2016

DIVISION:

Court of Appeal

PROCEEDING:

General Civil Appeal

ORIGINATING COURT:

District Court at Brisbane – Unreported, 9 March 2017 (Reid DCJ)

DELIVERED ON:

18 September 2018

DELIVERED AT:

Brisbane

HEARING DATE:

28 March 2018

JUDGES:

Sofronoff P and Douglas and Flanagan JJ

ORDERS:

1.   Allow the appeal.

2.   Set aside the orders made by the trial judge on 9 March 2017.

3.   Dismiss the respondents’ application filed 23 February 2017.

4.   Order that Proceeding DC 3903/16 be transferred to the Supreme Court and placed on the self-represented litigants list.

5.   No order as to the costs of the proceedings before the trial judge.

6.   No order as to the costs of the appeal.

CATCHWORDS:

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – ENDING PROCEEDINGS EARLY – SUMMARY DISPOSAL – SETTING ASIDE – where the respondents owned shares in the appellant’s company – where the appellant entered into a deed to repurchase those shares – where the appellant did not perform the deed – where the respondents sought summary judgment for specific performance of the deed – where the trial judge gave summary judgment – where the appellant sought to set aside that judgment – where the appellant had pleaded certain defences – whether there was a real as opposed to a fanciful prospect of success of those defences

Deputy Commissioner of Taxation v Salcedo [2005] 2 Qd R 232; [2005] QCA 227, cited
Dupois v Queensland Television Ltd & Ors[2015] QCA 160, cited
MNSBJ Pty Ltd v Downing[2017] QCA 141, followed
Queensland University of Technology v Project Constructions (Aust) Pty Ltd (in liq) [2003] 1 Qd R 259; [2002] QCA 224, applied

COUNSEL:

The appellant appeared on his own behalf
J C Faulkner for the respondent

SOLICITORS:

The appellant appeared on his own behalf
Mathews Hunt Legal for the respondent

SOFRONOFF P: I agree with the reasons for judgment of Douglas J.
DOUGLAS J: This is an appeal from an order made in the District Court granting summary judgment in favour of the respondents against the appellant for specific performance of a share sale and purchase deed entered into by the parties in or about September 2015. The appellant submits that the learned District Court judge failed to adequately investigate certain factual issues. The respondent submits that the factual issues were adequately investigated, but even if they were not, they have no bearing on the resolution of this matter.
Background
The appellant is associated with two companies, Australia Pacific Investments Pty Ltd (“API”) and Sunshine Surf Park Pty Ltd (“SSP”).…

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 Downing v MNSBJ Pty Ltd

Details

AGLC: Downing v MNSBJ Pty Ltd [2018] QCA 223
Case: [2018] QCA 223
Decision Date: 18 September 2018

CaseChat Overview and Summary

The case of Downing v MNSBJ Pty Ltd involved a dispute between the parties regarding the enforcement of a deed to repurchase shares in the appellant's company. The respondents, who owned shares in the appellant’s company, had sought summary judgment for specific performance of the deed after the appellant failed to perform it. The trial judge granted the respondents’ application for summary judgment. The appellant then sought to set aside the summary judgment on the basis that there was a real prospect of success of certain defences that had been pleaded. The Queensland Court of Appeal considered whether the appellant had demonstrated a real as opposed to a fanciful prospect of success of those defences.

The central legal issue was whether the appellant had demonstrated a real prospect of successfully defending against the respondents’ application for summary judgment. The Court of Appeal needed to determine whether the defences pleaded by the appellant were sufficient to create a real prospect of success, as opposed to a mere fanciful one. The defences included allegations of misleading and deceptive conduct, the existence of a collateral contract, and a breach of fiduciary duty. The Court of Appeal needed to assess whether these defences, if proven, could effectively counter the respondents’ claim for specific performance.

The Court of Appeal held that the appellant had demonstrated a real prospect of successfully defending the claim. The Court noted that the facts pleaded arguably raised at least three answers to the respondents’ claim: misleading and deceptive conduct by the respondents, the existence of a collateral contract, and a breach of fiduciary duty. The Court also considered that there were other potential arguments related to the proper construction of the obligations under the deed. The Court of Appeal concluded that these defences, if proven, were sufficient to create a real prospect of success. Therefore, the appeal was allowed, the orders made by the trial judge were set aside, and the matter was transferred to the Supreme Court for further proceedings.

Orders

Orders of the court

1. Allow the appeal.

2. Set aside the orders made by the trial judge on 9 March 2017.

3. Dismiss the respondents’ application filed 23 February 2017.

4. Order that Proceeding DC 3903/16 be transferred to the Supreme Court and placed on the self-represented litigants list.

5. No order as to the costs of the proceedings before the trial judge.

6. No order as to the costs of the appeal.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

It should be pointed out that Mr Downing was self-represented which may explain his failure to plead the defence more fully but, again, as Morrison JA pointed out, the defence did plead that the deeds were each one part of a suite of agreements which his Honour said might be seen to raise the contention that the deeds were in fact conditional upon one another, thus justifying rectification of them.[3][3]MNSBJ Pty Ltd v Downing [2017] QCA 141 at [18].Consideration The facts that had been pleaded very arguably raised at least three answers to the claim: misleading and deceptive conduct by the respondents, the existence of a collateral contract affecting the proper operation of the SSP deed, and a breach of fiduciary duty on the part of one co-venturer to another. There may be other arguments available related to the proper construction of the obligations arising under the SSP Deed when one considers the meaning of the words “Completion Date” in that deed, where there will never be a date on which Nurrowin acquired the land defined in that document by reference, arguably, to the option agreement.[4][4]See AR 304 and the transcript of the oral submissions at T1-32 to T1-34. His Honour did not determine those issues on the application before him but it seems to me that they were all sufficient to give rise to the conclusion that there was a real as opposed to a fanciful prospect of success of the defence.[5] In those circumstances, it was my view that the appeal should be allowed and that orders should also be made transferring this matter to the Supreme Court to be heard with the proceedings already initiated there.[5]See Queensland University of Technology v Project Constructions (Aust) Pty Ltd (in liq) [2003] 1 Qd R 259, 264-265 at [7]; Deputy Commissioner of Taxation v Salcedo [2005] 2 Qd R 232, 233 at [1], 234-236 at [11]-[14], 242 at [46]-[47]; Dupois v Queensland Television Ltd & Ors [2015] QCA 160 at [13]-[14].Orders That is why I joined in the orders made on 28 March 2018 to this effect:1.Allow the appeal;2.Set aside the orders made by Reid DCJ on 9 March 2017;3.Dismiss the respondents’ application filed 23 February 2017;4.Order that Proceeding DC 3903/16 be transferred to the Supreme Court and placed on the self-represented litigants list;5.No order as to the costs of the proceedings before Reid DCJ;6.No order as to the costs of the appeal. FLANAGAN J: I agree with the reasons of Douglas J.

CITATION:	Downing v MNSBJ Pty Ltd & Ors [2018] QCA 223
PARTIES:	ARTHUR CHARLES DOWNING (appellant) v MNSBJ PTY LTD ACN 144 779 448 (first respondent) FRESH WATER FROFFERS PTY LTD ACN 169 204 933 (second respondent) JOHN SULLIVAN (third respondent) NICHOLAS JOEL GIBBIE (fourth respondent) TAMMIE ANNE GIBBIE (fifth respondent) GILES IVOR WAKFIELD (sixth respondent)
FILE NO/S:	Appeal No 3317 of 2017 DC No 3903 of 2016
DIVISION:	Court of Appeal
PROCEEDING:	General Civil Appeal
ORIGINATING COURT:	District Court at Brisbane – Unreported, 9 March 2017 (Reid DCJ)
DELIVERED ON:	18 September 2018
DELIVERED AT:	Brisbane
HEARING DATE:	28 March 2018
JUDGES:	Sofronoff P and Douglas and Flanagan JJ
ORDERS:	1. Allow the appeal. 2. Set aside the orders made by the trial judge on 9 March 2017. 3. Dismiss the respondents’ application filed 23 February 2017. 4. Order that Proceeding DC 3903/16 be transferred to the Supreme Court and placed on the self-represented litigants list. 5. No order as to the costs of the proceedings before the trial judge. 6. No order as to the costs of the appeal.
CATCHWORDS:	PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – ENDING PROCEEDINGS EARLY – SUMMARY DISPOSAL – SETTING ASIDE – where the respondents owned shares in the appellant’s company – where the appellant entered into a deed to repurchase those shares – where the appellant did not perform the deed – where the respondents sought summary judgment for specific performance of the deed – where the trial judge gave summary judgment – where the appellant sought to set aside that judgment – where the appellant had pleaded certain defences – whether there was a real as opposed to a fanciful prospect of success of those defences Deputy Commissioner of Taxation v Salcedo [2005] 2 Qd R 232; [2005] QCA 227, cited Dupois v Queensland Television Ltd & Ors[2015] QCA 160, cited MNSBJ Pty Ltd v Downing[2017] QCA 141, followed Queensland University of Technology v Project Constructions (Aust) Pty Ltd (in liq) [2003] 1 Qd R 259; [2002] QCA 224, applied
COUNSEL:	The appellant appeared on his own behalf J C Faulkner for the respondent
SOLICITORS:	The appellant appeared on his own behalf Mathews Hunt Legal for the respondent