Esanda Finance Corporation Limited v Meehan & Anor

Case •

[2008] QDC 318

•

19 November 2008

DISTRICT COURT OF QUEENSLAND

CITATION:

Esanda Finance Corporation Limited v Meehan & Anor [2008] QDC 318

PARTIES:

ESANDA FINANCE CORPORATION LIMITED ABN 64 004 346 043
(Plaintiff)

And

DAVID JOHN MEEHAN
(First Defendant)

And

JOHN THOMAS DOLAN
(Second Defendant)

FILE NO/S:

1861/08

DIVISION:

Civil

PROCEEDING:

Application

ORIGINATING COURT:

District Court

DELIVERED ON:

19 November 2008

DELIVERED AT:

Brisbane

HEARING DATE:

13 October 2008

JUDGE:

Devereaux SC DCJ

ORDER:

1.          Proceeding transferred to the Southport registry of the District Court.

2.          The costs of the parties to this application be costs in the cause.

CATCHWORDS:

PROCEDURE – application to transfer proceeding –claim against first defendant for money owing under a chattel mortgage -  claims against second defendant for return of money paid at first defendant’s direction under chattel mortgage – where neither defendant lives or carries on business in Brisbane district - whether any claim arises in the Brisbane district - whether proceeding correctly commenced in Brisbane registry.

PROCEDURE – application to transfer proceeding – claim against first defendant for money owing under a chattel mortgage -  claims against second defendant for return of money paid at first defendant’s direction under chattel mortgage - where neither defendant lives or carries on business in Brisbane district - where first defendant bankrupt – where no cause of action against second defendant arises in Brisbane district.

Uniform Civil Procedure Rules r44, r35, r65, r72, r45,
Bankruptcy Act 1966 (Cth)
Sale of Goods Act 1896 s20, s21

Clarke v Clarke [1905] QWN 11
Collier v Liebrecht [1983] 2 Qd R 726
The King v. Stipendiary Magistrate at Biloela and Kallis, ex parte Savas [1944] St.R.Qd. 68
The King v. Magistrates Court at Mount Isa and Rappensburg, ex parte Owens [1951] St.R.Qd. 14
Comber v. Leyland [1898] AC 524
Pilcher v Logan  (1914) 15 SR NSW 24

COUNSEL:

F. Forde (Counsel) for respondent
K. Magee (Counsel) for applicant

SOLICITORS:

Deacons for the respondent
Robins Watson Solicitors for the applicant

  1. The applicant, Mr Dolan, agreed to sell a stretch limousine to Mr Meehan (the first defendant).  Mr Meehan sought and was granted finance, subject to a chattel mortgage, from ESANDA Finance Corporation Limited to pay for the car.  Apparently at Mr Meehan’s direction, Esanda paid $74,500 to Mr Dolan’s account.  But Mr Meehan did not pay the remainder of the purchase price and so the sale of the car did not proceed. 

  1. Esanda sued the first defendant for money due and owing under the chattel mortgage.  Esanda also sued Mr Dolan (as second defendant), in the same proceeding, for the return of the $74,500 either as money had and received, or money by which he has been unjustly enriched or as damages for breach of trust.

  1. Mr Dolan has applied for orders that the proceeding be dismissed or transferred to the Southport registry of the court, pursuant to Rule 44 of the Uniform Civil Procedure Rules, principally because it has been commenced in the wrong district.

The proceedings

  1. Esanda’s statement of claim, filed on 9 July 2008, alleges that on or about 3 March 2006, at the request of the first defendant, it “advanced” the sum of $74,500 to the applicant under the terms of a chattel mortgage dated 6 February 2006.

  1. It appears the first defendant has not filed a notice of intention to defend.

  1. The applicant, on 10 September 2008, filed a “Conditional notice of intention to defend” disputing the jurisdiction of the court to entertain the claim against him without his consent because the proceeding should have been commenced in the Southport registry.

  1. That pleading is taken to be an objection, under UCPR r44, which relevantly provides:

Objection to court
(1) A defendant ….. may object to the starting of a
proceeding other than in the correct district under division 2—

(a) for a proceeding started by claim—only if the objection is included in the defendant’s notice of intention to defend; or
(b) …..

(2) ……

(3) The objection is taken to be an application.

(4) The court may make any of the following orders on an application or objection under this rule—

(a) an order dismissing—

(i) the application or objection; or

(ii) the proceeding;

(b) an order transferring the proceeding to another court.

This application

  1. UCPR r35 relevantly provides:

(1) A person must start a proceeding before a court in 1 of the following districts—

(a)the district in which the defendant or respondent lives or carries on business;

(b)if there is more than 1 defendant or respondent—the district in which 1 or more of the defendants or respondents live or carry on business;

(c)if the parties to a proceeding to be started in ….the District Court consent in writing and file the consent with the registrar—

i.…..; or

ii.for the District Court—any district of the District Court;

(d)if a defendant has agreed or undertaken in writing to pay a debt or another amount at a particular place—the district in which the place is located;

(e)the district in which all or part of the claim or cause of action arose;

(f)if the proceeding is a claim for the recovery of possession of land—the district in which the land is located.

  1. The applicant swears: he lives at Currumbin Waters; his bank account, where Esanda paid the money, is at Elanora; the limousine has always been on the Gold Coast and the agreement was made in the Southport district.

  1. The claim is endorsed to be served on the first defendant at an address at Elanora and on the applicant an address at Currumbin. 

  1. So, the applicant submits, the proceeding was wrongly commenced in the Brisbane registry of the court because the applicant lives outside the Brisbane district (and, for that matter, so does the first defendant) and the cause of action as between the plaintiff and the applicant did not arise in the Brisbane district.  The last argument is as follows: the cause of action depends on the applicant having received money; money is not received until it is in the hands of the recipient[1]; the money was received in the applicant’s account which was held within the Southport district of the court; no other element of any of the asserted causes of action arose in the Brisbane district.

    [1]Pilcher v Logan  (1914) 15 SR NSW 24

  1. The respondent/plaintiff’s Counsel submits:

(a)that if any of the four claims arose in the Brisbane district the proceeding will have been commenced correctly; the chattel mortgage includes a term that money paid under the mortgage will be paid to Esanda “at Esanda’s address”; that address is disclosed at the top of the mortgage as Level 8, 324 Queen Street, Brisbane; therefore the claim against the 1st defendant is correctly commenced in Brisbane under r35(1)(d).

(b)that the action for money had and received involves the breach of an implied promise to pay money to the plaintiff; the plaintiff is in Brisbane; therefore the claim arose in Brisbane. 

  1. I am not satisfied the claim for money had and received arose in the Brisbane district. 

  1. The plaintiff’s Counsel referred to Clarke v Clarke [1905] QWN 11, where the plaintiff, living in Brisbane, through an agent instructed the defendant, in Maryborough, to sell a boat that was in Maryborough. The defendant sold the boat but did not remit the proceeds to the plaintiff. Mansfield DCJ held that the plaintiff’s action for money had and received was correctly commenced in Brisbane, because,

“in the absence of a special stipulation, or a course of practice to the contrary, the place for payment was Brisbane, and that non-payment was a breach of an implied promise to pay by the defendant, and was a “material point” in the cause of action”.

  1. At the hearing of the application I invited further submissions on the question where a claim for money had and received arises.  Counsel for the applicant filed further submissions including reference to Collier v Liebrecht [1983] 2 Qd R 726. In that case, the respondent, who carried on business in Cairns, commenced proceedings in the District Court at Cairns claiming the commission on the sale of a yacht. The owners did not live in Cairns. The only relevant document did not clearly specify a place for payment of the commission. Connolly J, with whom Douglas and Macrossan JJ agreed, said at 727-728,

“There are two decisions of this Court of long standing that the residence of the creditor in a Magistrates Court district is not sufficient to show that the plaintiff’s cause of action arose wholly or in any material point in that district, and it is obvious that the Magistrates Courts Rules and the District Court rule which I have already set out are in very similar terms. The decisions to which I refer are The King v. Stipendiary Magistrate at Biloela and Kallis, ex parte Savas [1944] St.R.Qd. 68 and The King v. Magistrates Court at Mount Isa and Rappensburg, ex parte Owens [1951] St.R.Qd. 14. In the former, Webb C.J. observed at p. 72:

‘Nothing was done or required to be done in this Magistrates Court’s district which it was necessary to prove in order to establish the claim.’

And Macrossan S.P.J. at p. 77 similarly said that:

‘… the failure of the defendant to do some act of performance of a contract is not a material part of a cause of action arising in a specified district unless failure of performance in that district is a fact which the plaintiff would have to prove wherever he might sue.’

We are bound by those two decisions which, in my view, are wholly consistent with the decision of the House of Lords in Comber v. Leyland[2] (supra).”

[2] [1898] AC 524

  1. In The King v S.M. at Biloela and Kallis [1944] St R Qd 68, a shopkeeper at Biloela sued an importer at Adelaide for the price paid for 20 boxes of cigarette papers that were not delivered to him. Webb CJ said, at [1944] St R Qd 71, the shopkeeper was -

“alleging in effect that [the importer] received the money for these twenty boxes, failed to send the twenty boxes, but still wrongfully retained the money for the twenty boxes.  If so, the wrong was committed outside Queensland and it was not converted into a breach of duty committed in Queensland by [the shopkeeper’s] action in electing to treat the price of the twenty boxes as a debt due to [him] and suing for it as money had and received.”

  1. That case was referred to in The King v Magistrates Court at Mt Isa and Rappensburg, Ex parte Owens [1951] St R Qd 14. Macrossan CJ, at 23, said:

“The cause of action was the receipt by the respondent of the prosecutor’s money at Charters Towers and the respondent’s failure to repay the money in circumstances where the law would impart an obligation to repay.”

  1. Macrossan CJ thought The King v SM at Bileola and Kallis was,

“clear authority that in an action for money had and received to the use of the plaintiff the fact that the plaintiff resides in a particular district does not, without more, make his cause of action one which arises in a material point in that district.”

  1. I conclude that no part of the plaintiff’s claim against the applicant arose in the Brisbane district.

  1. The next question is whether the respondent’s claim against the first defendant arose in the Brisbane district and whether, thereby, the proceeding is correctly commenced in the Brisbane registry of the court.

  1. The chattel mortgage is before the court as an attachment to the affidavit of member of the firm of solicitors for the plaintiff.  Clause 3 of the Terms and Conditions includes the following,

“(f) all money will be paid to Esanda at Esanda’s address disclosed in the Table or any other address that Esanda nominates to me.”

  1. At the top of the mortgage are the words:

“CHATTEL MORTGAGE 
To: Esanda Finance Corporation Limited …..
of Level 8, 324 Queen Street, Brisbane QLD 4000”

  1. In the circumstances, I accept the submission that the claim against the first defendant is correctly commenced in Brisbane under r35(1)(d).

  1. It seems to me the plaintiff correctly commenced its claims against the two defendants in the one proceeding because the various forms of relief sought “arise out of the same transaction or event or series of transactions or events” (UCPR r65(1))

  1. It follows that the proceeding, including the claim against the applicant, was correctly commenced in the Brisbane registry of the court.

  1. Nonetheless, I consider it appropriate to order, under r44(4)(b), that the proceeding be transferred to the Southport registry of the court.

  1. According to a letter sent by the plaintiff’s solicitors, “the proceedings against the first defendant have not been served.”  The solicitors assert that they were “instructed that the first defendant is now a bankrupt” and “accordingly the proceedings against him are stayed.”

  1. The first defendant has not filed notice of intention to defend.

  1. There is no material from which I can infer an intention on the part of the plaintiff to seek leave, under UCPR r72, to proceed against the first defendant. No material or argument was presented regarding the effect of the provisions of the Bankruptcy Act 1966 (Cth) on the claim against the first defendant.

  1. The practical position appears to be that the only claims likely to proceed are those against the applicant. As I have found, they do not arise in the Brisbane district of the court and no other part of r35 supports their commencement in this district.

  1. The applicant lives in the Southport district.  The money in dispute was paid in that district.  The agreement between the applicant and the first defendant, for the sale of the car, seems to have been made in the Southport district.  There might be a real and relevant question as to whether property in the car passed from the applicant to the first defendant.[3]  If so, the first defendant might be required to testify.  He resides in that district.  The travel expenses, such as there may be, of witnesses and legal representatives between Brisbane and the Southport district, may weigh more heavily on the applicant, an individual, than on the plaintiff, a corporation.

    [3] See Sale of Goods Act 1896 ss20,21

  1. Alternatively, for the reasons just stated, I conclude that the proceeding could be more conveniently and fairly dealt with in the court sitting at Southport, and order its transfer pursuant to UCPR r45, which provides:

Change of venue by court order
(1) This rule applies if at any time a court (the first court) is satisfied a proceeding pending in the first court can be more conveniently or fairly heard or dealt with in another court.
(2) The first court may order that the proceeding be sent for trial to or to be dealt with by the other court.

  1. The costs of each party to the application should be costs in the cause.

Orders

1.          Proceeding transferred to the Southport registry of the District Court.

2.          The costs of the parties to this application be costs in the cause.


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