Gedala P/L and Doyle Properties P/L v Gusdote P/L

[2010] QSC 482

SUPREME COURT OF QUEENSLAND

CITATION:

Gedala P/L and Doyle Properties P/L v Gusdote P/L [2010] QSC 482

PARTIES:

GEDALA PTY LTD ACN 010 266 547

and

DOYLE PROPERTIES PTY LTD ACN 010 109 252
(plaintiffs)

v
GUSDOTE PTY LTD ACN 089 937 253
(respondent)

FILE NO/S:

BS 6722 of 2004

DIVISION:

Trial Division

PROCEEDING:

Trial

ORIGINATING COURT:

Supreme Court, Brisbane

DELIVERED EX TEMPORE ON:

26 November 2010

DELIVERED AT:

Brisbane

HEARING DATE:

26 November 2010

JUDGE:

Margaret Wilson J

ORDER:

The Court declares that:

1. The joint venture agreement entered into between the first plaintiff, second plaintiff and defendant on 18 July 2002 has been terminated by performance;
2. The defendant is and was, from 19 September 2003, obliged to contribute to the joint venture the sum of $769,038.66 together with interest from that date at the rate of 10% being the amount of $1,322,366.86; and
3. The first and second plaintiffs each held a legal and beneficial interest in the unit land to the extent of 50% each and are entitled to the proceeds of the sale of the land described as Lot 3 on SP 151678 ("the Unit Land").

Further, the Court orders that:

4.   The defendant pay to the first plaintiff the sum of $416,626.63 and to the second plaintiff the further sum of $416,626.63 in respect of claim and interest to the day of Judgment;

5.   The amount of $758,359.05, together with all accretions, held in the trust account of MacDonnells Law, solicitors for the plaintiffs, representing part of the proceeds of sale of the unit land, be released to the plaintiffs as follows:

a.   half to the first plaintiff; and

b.   half to the second plaintiff;

6.   The defendant’s counterclaim is dismissed; and

7.   The defendant pay the plaintiffs’ costs of and incidental of these proceedings, including reserved costs, on the standard basis to be agreed or, failing agreement, to be assessed.

CATCHWORDS:

REAL PROPERTY – GENERAL PRINCIPLES – proceeds of sale – where joint venture between plaintiffs and defendant for development of land – where land acquired in name of defendant – where defendant sold land to the plaintiffs – where plaintiffs sold land to unrelated third party – where defendant in voluntary administration – where administrator gave written consent to continuation of proceeding – where no appearance by administrator – where no appearance by anyone seeking to prosecute the counterclaim – whether plaintiffs established claim pursuant to Uniform Civil Procedure Rules 1999 (Qld) r 476 – whether plaintiffs entitled to net proceeds of sale

Uniform Civil Procedure Rules 1999 (Qld), r 476

COUNSEL:

AM Musgrave for the plaintiffs

No appearance by the defendant

SOLICITORS:

MacDonnells Law for the plaintiffs

No appearance by the defendant

HER HONOUR: The plaintiffs' claim arises out of a joint venture agreement between the plaintiffs and the defendant for the development of land comprising part of the Willows Golf Course at Thuringowa in North Queensland. There was no joint venture vehicle and the land was acquired in the name of the defendant.

The first plaintiff has at all material times been controlled by John Doyle and the second plaintiff by his brother Edward Doyle. They carry on business in partnership as Doyle Built Homes.

At all material times the defendant was controlled by Don Matheson. Recently it went into voluntary administration. The administrator has given his written consent to the continuation of this proceeding against the company. There was no appearance today by the administrator; nor was there an appearance by anyone seeking to prosecute the counterclaim.

Pursuant to Rule 476 of the Uniform Civil Procedure Rules 1999 (Qld) the plaintiffs must establish their claim, and they have done so by affidavit evidence. The plaintiffs are also entitled to an order dismissing the counterclaim against them.

Counsel took me through the affidavit evidence. It is clearly and adequately summarised in his written submissions, which I respectfully adopt. I am satisfied that the joint venture was for the development of stage 1 of the golf course. This was pursuant to a joint venture agreement made on or about 18 July 2002. Pursuant to that agreement stage 1 was subdivided into 33 lots, the last of them being sold in September 2003. Thereupon, the joint venture terminated.

There is another parcel of land referred to in the proceeding as "the unit land" or "stage 2 of the golf course development". The defendant contended that it came to be included within the scope of the joint venture. I think this is very doubtful, but even if that did happen, by 30 June 2003 it was no longer within the scope of the joint venture.

By a contract made on or about 14 July 2003 the defendant sold the unit land to the plaintiffs. That contract was completed and a transfer was registered on 1 August 2003.

While the joint venture subsisted, there were loan accounts in its books. At the time it came to an end in September 2003, the defendant owed the joint venture $769,038.66. The joint venture owed the plaintiffs $200,144 (i.e., $100,072 each).

The plaintiffs sold the unit land to an unrelated third party for $2.1 million. The transaction was settled on 10 September 2007, the net proceeds of sale being $1,980,195.22. The plaintiffs had agreed with the defendant to deposit one-third of the net proceeds in MacDonnells Law Trust Account, to be distributed in accordance with the consent of the plaintiffs and the defendant or an order of the Supreme Court.

Accordingly, $660,065.08 was deposited into that trust account. With interest, the amount of the deposit grew to $758,359.05. I am satisfied that the plaintiffs are entitled to those moneys in equal shares.

Counsel has prepared a draft judgment by which the Court makes certain declarations and orders with respect to the payment of moneys. I am prepared to make declarations and orders in terms of that draft, which I shall initial and have placed with the papers.