Faitrouni v El Omar - [1999] NSWSC 84

CITATION: Faitrouni v El Omar [1999] NSWSC 84

CURRENT JURISDICTION:

FILE NUMBER(S): 2588/96

HEARING DATE(S): 10 February 1999

JUDGMENT DATE:
10 February 1999

PARTIES :

Abdull Sattar Faitrouni v Ibraham El Omar

JUDGMENT OF: Windeyer J at 1

COUNSEL : Mr. A. Clout (Plaintiff)
Ms J Needham (Defendant)

SOLICITORS: Johnston & Vaughan (Plaintiff)
Robinson Creais (Defendant)

CATCHWORDS:

DECISION: Claim for order for accounts dismissed. Balance of plaintiff's claim dismissed

1 HIS HONOUR: This is an action arising out of a partnership which was carried on from 1 June 1986 between the plaintiff and the defendant for the specific purpose of importing tiles from Lebanon into Australia for sale in Australia.
2 The action has by an earlier order proceeded on pleadings, but as a result of consent orders made earlier today to a large extent the issues which might have been seen to arise on those pleadings no longer arise.
3 Under those consent orders, I made declarations that a partnership existed between the plaintiff and the defendant for this specific purpose; that the partners were entitled to share in the profits and obliged to share in the losses in equal shares; that upon dissolution of the partnership the partners were entitled, if there were sufficient funds available, to be repaid their capital contributions prior to any balance being distributed to them in equal shares; and finally, that the partnership was dissolved on 1 January 1990.
4 On this latter matter it is clear that the purpose of the partnership at that date came to an end subject to any question of final accounting. As a result of those declarations, the only question which remained for determination by me was whether or not there should be an order for accounts which would be taken before the Master, the accounts, of course, being consequent upon the dissolution of the partnership. In general a partner is entitled to an order for accounts upon dissolution and it was not suggested otherwise by counsel for the defendant. The grounds upon which an order was opposed were, first, that applying the Limitation Act by analogy the time for bringing the action for accounts had passed; and secondly, that the plaintiff's claim should be disallowed by reason of laches.
5 This action was commenced by summons filed on 29 June 1996 which is, of course, more than six years after the date upon which the partnership was dissolved. It follows from this that if this were a claim for an account at law it would be barred by Section 15 of the Limitation Act 1969. While counsel for the defendant did argue that Section 15 applied, I do not think this argument was pressed very strongly and I think it relevant to state that a defence based on Section 15 has never been pleaded. However, while no application has been made to mount the defence, I think it right to say that I am of the clear view that an action for accounts of a partnership…

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 Faitrouni v El Omar

Details

AGLC: Faitrouni v El Omar [1999] NSWSC 84
Case: [1999] NSWSC 84
Decision Date: 10 February 1999

CaseChat Overview and Summary

The case of Faitrouni v El Omar [1999] NSWSC 84 involved a dispute between Abdull Sattar Faitrouni and Ibraham El Omar, which originated from a partnership that had been established on 1 June 1986. The partnership's purpose was to import tiles from Lebanon into Australia for sale. The partnership dissolved on 1 January 1990, but the plaintiff, Faitrouni, sought an order for accounts upon dissolution, which the defendant, El Omar, opposed. The case was heard by Windeyer J on 10 February 1999.

The court had to determine whether Faitrouni was entitled to an order for accounts following the partnership's dissolution. The primary legal issues were whether the claim for accounts was barred by the Limitation Act 1969 and whether the plaintiff's claim should be disallowed by reason of laches. The court examined whether the action for accounts was a claim at law or in equity and, if in equity, whether the same limitation period applied. Additionally, the court considered if the delay in bringing the action had prejudiced the defendant, thus making it inequitable to allow the claim.

Windeyer J held that an action for accounts of a partnership is a claim in equity rather than at law, and therefore, the Limitation Act 1969 did not apply. The court concluded that the same limitation period should be applied by analogy to a claim for accounts in equity. Since Faitrouni commenced the action more than six years after the dissolution, the claim for accounts was dismissed. The court also found that the defendant's claim of laches was not sustainable as there was no evidence of prejudice or disadvantage to the defendant due to the delay.

The court dismissed Faitrouni's claim for an order for accounts and also dismissed the balance of the plaintiff's claim. The court ordered Faitrouni to pay the defendant's costs, following the principle that costs usually follow the event.

Orders