Endeavour Health Care Holdings Pty Ltd v Westpoint Financial Services Pty Ltd

[2004] WADC 83

JURISDICTION     :   DISTRICT COURT OF WESTERN AUSTRALIA

IN CHAMBERS

LOCATION:   PERTH

CITATION:   ENDEAVOUR HEALTH CARE HOLDINGS PTY LTD -v- WESTPOINT FINANCIAL SERVICES PTY LTD [2004] WADC 83

CORAM:   DEPUTY REGISTRAR HARMAN

HEARD:   1 APRIL 2004

DELIVERED          :   10 MAY 2004

FILE NO/S:   CIV 2340 of 2003

BETWEEN:   ENDEAVOUR HEALTH CARE HOLDINGS PTY LTD

Plaintiff

AND

WESTPOINT FINANCIAL SERVICES PTY LTD
Defendant

Catchwords:

Practice - Western Australia - Practice under the Rules of the Supreme Court of Western Australia - Application by the plaintiff for summary judgment

Legislation:

Nil

Result:

Application dismissed

Representation:

Counsel:

Plaintiff:     Mr A R Beech

Defendant:     Mr N D C Dillon

Solicitors:

Plaintiff:     Mallesons Stephen Jaques

Defendant:     Wojtowicz Kelly

Case(s) referred to in judgment(s):

Nil

Case(s) also cited:

Nil

1. DEPUTY REGISTRAR HARMAN:  The plaintiff's claim in the action is brought under an agreement between the parties whereby the plaintiff would purchase from the defendant property of significant value.  It was part of the agreement that following settlement the parties would adjust their financial relationship to reflect a final account prepared by the purchaser.  Ultimately the plaintiff produced such an account and on that basis has issued a demand for $193,000 which amount remains unpaid.

2. It has brought an application for a summary judgment.  The affidavit in support of that application introduces the agreement between the parties, the communications between them relating to the account and the demand.

3. The case presented by the plaintiff at the hearing was along the lines that the affidavit justified the terms of the pleading and that the onus passed to the defendant.  I accept that one may conclude that an evidentiary onus passes to the defendant however summary judgment is discretionary and it is for the applicant to persuade the Court that in that context it is appropriate to enter judgment.

4. The plaintiff's case depends upon the account forwarded to the defendant satisfying the terms of cl 3.4 of the Agreement for Purchase of Shares.  It provides as follows:

   "3.4Within three months following the Startune Completion, the Purchaser will cause to be prepared the Final Completion Accounts based on the agreed principles.  Immediately after the Final Completion Accounts become available, the parties will make an adjustment to reflect any differences between Liabilities disclosed in the Estimated Completion Accounts and the Final Completion Accounts.  The adjustment of the Startune Purchase Price required by this clause 3.4 shall be made in cash."

5. The issue raised by the defendant is as to how the parties would come to the point of making that adjustment.  At the very least the defendant contends that whatever is required to be undertaken for the purposes of cl 3.4 it is not sufficiently certain as to justify an exercise of discretion in favour of the plaintiff.

6. To some extent the defendant's case is supported the fact that for the purposes of the application the issues raised by the defendant in relation to the account have been conceded.  On the one hand that allows the plaintiff to proceed with the application to the extent that there is no dispute.  On the other, it indicates that at least the plaintiff recognises scope for lack of certainty in relation to any process of reconciliation and\or the value represented by the final account.

7. The proposition of the defendant is that the figures represented by the plaintiff have changed over time and that in not having access to the data from which the accounts were drawn the defendant is at a disadvantage.  Nonetheless, it has been able to raise issues that question a significant part of the amount claimed.  The defendant points to the prospect that the plaintiff's evidence lacks certainty in the form of a sufficient commitment to the process and the figures.  By its defence it proposes that there was an implied term that the account would be correct.

8. The fact that summary judgment is discretionary appears to be a consideration that is often overlooked.  Even in what may be characterised as a clear case there is no entitlement to judgment.

9. The words of cl 3.4 clearly contemplate that the adjustment would be made on the basis of at least mutual accommodation.  It does not provide how that would be achieved.  It is apparent that from the plaintiff's view the defendant has been dragging its feet in finalising a process that, it is also apparent, would be attended upon by some expedition.  From the defendant's view point it has proposed that an independent analyst be appointed and has also sought justification for the plaintiff's claim.

10. I accept that some 23 months is a significant period during which the defendant may have taken any number of courses in order to achieve resolution if it had any desire to do so.  It is conceivable that it had no desire to do so in light of the fact that the plaintiff was, not supporting a related enterprise in which the parties had proposed to engage, which the defendant contends would have conferred significant benefit on it and which was a related transaction.  I am not suggesting that the inaction may thereby be justified, simply conceivably, explained.

11. As I see the case the fundamental issue is whether under the agreement the plaintiff had a cause on which to bring the action.  That is, whether the plaintiff at the relevant time had an entitlement in relation to which it was entitled to issue a demand.  In my opinion it would be inappropriate to embark upon an investigation of the meaning of cl 3.4 without giving the parties the opportunity to present their cases in the usual manner.