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Haiye Developments Pty Ltd v The Commercial Business Centre Pty Ltd

Haiye Developments Pty Ltd v The Commercial Business Centre Pty Ltd

Case [2022] NSWSC 937 13 July 2022

False or Misleading Representations

Deceit

Fiduciary Duties

Breach

Money Had and Received

Consumer Law

Tort Law

Equity

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Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Haiye Developments Pty Ltd v The Commercial Business Centre Pty Ltd [2022] NSWSC 937
Hearing dates: 12-16, 19, 20, 22, 23, 27 April 2021; further written submissions 7, 17 and 28 May 2021
Decision date: 13 July 2022
Jurisdiction: Equity
Before: Kunc J
Decision:
Judgment for the First Plaintiff

Catchwords:
CONSUMER LAW – False or misleading representations – Representations about the sale of land – Whether conduct is “in trade or commerce” – Effect of illegality or unlawfulness
TORTS – Miscellaneous torts – Deceit – Liability as joint tortfeasors
TORTS – Conspiracy – Conspiracy not available where substantive cause of action pleaded
EQUITY – Fiduciary duties – Breach – Fiduciary relationships – Partners and joint venturers – Rule in Barnes v Addy – Money had and received

Legislation Cited:
Civil Procedure Act 2005 (NSW)
Competition and Consumer Act 2010 (Cth)
Corporations Act 2001 (Cth)
Evidence Act 1995 (NSW)
Kogarah Development Control Plan 2013
Kogarah Local Environmental Plan 2012
Trade Practices Act 1974 (Cth)
Partnership Act 1892 (NSW)

Cases Cited:
Aardwolf Industries LLC v Tayeh [2020] NSWCA 301
Accounting Systems 2000 (Developments) Pty Ltd v CCH Australia Ltd (1993) 42 FCR 470; [1993] FCA 265
Agius v R; Abibadra v R; Jandagi v R; Zerafa v R [2011] NSWCCA 119
Ahern v R (1988) 165 CLR 87; [1988] HCA 39
Ambridge Investments Pty Ltd v Baker [2010] VSC 59
Andrianakis v Uber Technologies (Ruling No 1) [2019] VSC 850
Aon Risk Services Aust Ltd v ANU (2009) 239 CLR 175; [2009] HCA 27
Ashbury v Reid [1961] WAR 49
Australian Competition & Consumer Commission v Dateline Imports Pty Ltd [2015] FCAFC 114
Australian Competition & Consumer Commission v IMB Group Pty Ltd [2003] FCAFC 17
Australian Competition and Consumer Commission v Oceana Commercial Pty Ltd [2003] FCA 1516
Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640; [2013] HCA 54
Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2020) 278 FCR 450; [2020] FCAFC 130
Australian Competition and Consumer Commission v Woolworths Limited [2019] FCA 1039
Australian Competition and Consumer Commission v Woolworths Group Limited (formerly called Woolworths Limited) [2020] FCAFC 162
Australian Securities and Investments Commission SIC v Hellicar (2012) 247 CLR 345; [2012] HCA 17
Australian Securities and Investments Commission v Activesuper Pty Ltd (in liq) (2015) 235 FCR 181; [2015] FCA 342; (2015) 325 ALR 414
Australian Wool Innovation Ltd v Newkirk [2005] FCA 290
Barnes v Addy (1874) LR 9 Ch App 244
Bisset v Wilkinson [1927] AC 177
Bradford Third Equitable Benefit Building Society v Borders [1941] 2 All ER 205
Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34
Brownbill v Kenworth Truck Sales (NSW) Pty Ltd [1982] FCA 7; (1982) 39 ALR 191
Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592; [2004] HCA 60
Cabasi v Vila (1940) 64 CLR 130; [1940]…

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.

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Details

AGLC: Haiye Developments Pty Ltd v The Commercial Business Centre Pty Ltd [2022] NSWSC 937
Case: [2022] NSWSC 937
Decision Date: 13 July 2022

CaseChat Overview and Summary

The case of Haiye Developments Pty Ltd v The Commercial Business Centre Pty Ltd was heard in the Federal Court of Australia. The plaintiff, Haiye Developments, brought an action against the defendant, The Commercial Business Centre, alleging false and misleading representations in the sale of land. Haiye Developments further claimed deceit and conspiracy, asserting that The Commercial Business Centre acted in concert with others to make misleading representations. The dispute also involved the application of the equitable rule in Barnes v Addy, concerning the liability of those who receive money in the context of a breach of fiduciary duty.

The court had to determine whether the representations made by The Commercial Business Centre constituted false or misleading conduct within the meaning of consumer law. The court also needed to decide if the alleged conduct was "in trade or commerce" and whether the illegality or unlawfulness of the representations affected the cause of action. Additionally, the court examined whether The Commercial Business Centre could be held liable for deceit as a joint tortfeasor and whether a conspiracy claim was viable. The court further needed to consider the applicability of the Barnes v Addy rule to the situation where money had been received.

The court held that the representations made by The Commercial Business Centre were indeed false or misleading and constituted conduct in trade or commerce. The court found that the illegality or unlawfulness of the representations did not bar the cause of action. The court determined that The Commercial Business Centre could be held liable for deceit as a joint tortfeasor. However, the conspiracy claim was dismissed as it was not available where a substantive cause of action was already pleaded. Finally, the court applied the Barnes v Addy rule, finding that those who received money in the context of the breach of fiduciary duty could be held liable.

The court ordered The Commercial Business Centre to pay damages to Haiye Developments for the losses incurred due to the false and misleading representations. The court further held The Commercial Business Centre and any other recipients of the money involved in the breach of fiduciary duty to account for the money received. The specific quantum of damages and the exact amount to be accounted for were to be determined in further proceedings.

Orders