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Garcia v Delfino

Garcia v Delfino

Case [2003] NSWSC 1001 5 November 2003

Jurisdiction

Account of Profits

Breach of Contract

Civil Litigation & Procedure

Partnership Law

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CITATION: Garcia v Delfino [2003] NSWSC 1001

HEARING DATE(S): 09/09/03, 10/09/03, 11/09/03, 24/09/03, 25/09/03

JUDGMENT DATE:
5 November 2003

JURISDICTION:
Equity Division

JUDGMENT OF: Barrett J

DECISION: Plaintiffs' notice of motion dismissed. First defendant's notice of motion dismissed.

CATCHWORDS: PROCEDURE - Supreme Court procedure - reference under Part 72 rule 13 - whether orders previously made were orders under Part 72 rule 13 - whether reports of accountant are capable of adoption by court - whether court may subject parties to regime in accountant's reports in exercise of inherent jurisdiction - PARTNERSHIP - dissolution - application by one partner for order that others account - whether grounds for account on wilful default bases shown - whether the particular order to account should be made

LEGISLATION CITED: Supreme Court Rules, Part 72 rules 2, 13

CASES CITED: Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199
Buckley v Bennell Design & Constructions Pty Ltd (1978) 140 CLR 1
Gava v Grljusich [1999] WASC 13
Landsal Pty Ltd v REI Building Society (1993) 113 ALR 643
Meehan v Glazier Holdings Pty Ltd (2002) 54 NSWLR 146
Najjar v Haines (1991) 25 NSWLR 224
Super Pty Ltd v SJP Formwork (Aust) Pty Ltd (1992) 29 NSWLR 549

PARTIES :
Daniel Garcia - First Plaintiff
Rubens Locaputo - Second Plaintiff
Locaputo-Garcia & Co Pty Ltd - Third Plaintiff
Daniel Delfino - First Defendant
D&D Property Investments Pty Limited - Second Defendant

FILE NUMBER(S): SC 3167/01

COUNSEL: Mr T A Hall - Plaintiffs
Mr A T McInnes QC/Mr H W D Stowe - Defendants

SOLICITORS: Norman Waterhouse Lawyers - Plaintiffs
Acuiti Legal - Defendants

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

BARRETT J

WEDNESDAY, 5 NOVEMBER 2003

3167/01 – DANIEL GARCIA & 2 ORS v DANIEL DELFINO & ANOR

JUDGMENT

1 On 10, 11, 24 and 25 September 2003, I heard two notices of motion, one filed by the plaintiffs and the other filed by the first defendant. The relief sought in the notices of motion will be better understood in the context of a description of the substantive proceedings.

2 The proceedings were commenced by summons filed on 20 June 2001. By that summons, the plaintiffs sought the appointment of a receiver and manager of the partnership business of Delfino & Delfino, solicitors, situated at Suit 1, 2 William Street, Fairfield, together with ancillary orders, including the usual order that an account be taken and inquiry held as to the dealings and transactions of the partners and the partnership and the assets and liabilities of the firm The first and second plaintiffs, Mr Garcia and Mr Locaputo, and the first defendant, Mr Delfino, had entered into partnership on 1 January 1999. Mr Delfino and his brother, both solicitors, had previously conducted a practice in partnership. Upon the withdrawal of the brother, Mr Delfino, Mr Garcia and Mr Locaputo became partners. Mr Garcia and Mr Locaputo are not solicitors. They are accountants. The partnership was thus of a…

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 Garcia v Delfino

Details

AGLC: Garcia v Delfino [2003] NSWSC 1001
Case: [2003] NSWSC 1001
Decision Date: 5 November 2003

CaseChat Overview and Summary

The case of Garcia v Delfino came before the court in relation to disputes concerning partnership dissolution and the orders that may be made following such dissolution. The applicants, Garcia and others, sought an order for the other partners, including Delfino, to account for partnership assets. The dispute arose from the dissolution of a partnership and involved questions about the scope of court orders and the applicability of accountant's reports in such cases. The Supreme Court was tasked with determining whether the orders previously made were under Part 72 rule 13, whether the reports of the accountant could be adopted by the court, and whether the court could exercise its inherent jurisdiction to subject the parties to the regime outlined in the accountant's reports. Additionally, the court had to decide whether the applicants had shown grounds for an account on the basis of wilful default and whether a specific order to account should be made.

The central legal issues addressed by the court involved the interpretation of court orders under Part 72 rule 13, the admissibility and adoption of accountant's reports, and the inherent jurisdiction of the court to enforce a specific regime in partnership dissolution cases. Furthermore, the court had to consider the evidence and arguments presented regarding wilful default and whether these justified an order for an account. The applicants contended that the orders previously made were indeed under Part 72 rule 13 and that the accountant's reports should be adopted. They also argued that the court could, under its inherent jurisdiction, subject the parties to the regime proposed in the accountant's reports. Delfino, on the other hand, challenged these assertions and argued against the adoption of the reports and the making of the specific order to account.

In its reasoning, the court clarified that the orders in question were not made under Part 72 rule 13 and that the reports of the accountant could not be adopted by the court. The court found that while it had inherent jurisdiction to address the dissolution of partnerships and order an account where necessary, it could not enforce the specific regime proposed by the accountant without proper orders. The court also concluded that the applicants had not demonstrated sufficient grounds for an account based on wilful default. Consequently, the court ruled against the making of the particular order to account.

As a result of the court's findings, the orders previously made were not upheld, and the specific order to account was not granted. The court's decision underscored the importance of proper legal procedures in partnership dissolution cases and the limited scope of inherent jurisdiction in adopting external reports. The final orders of the court reflected the court's determination that the applicants had not met the necessary criteria for the relief sought.

Orders