Hawes v Dean - [2013] NSWSC 745

Supreme Court

New South Wales

Medium Neutral Citation: Hawes & anor v Dean & ors [2013] NSWSC 745
Hearing dates: 22 - 24 May 2012
Decision date: 12 June 2013
Jurisdiction: Equity Division
Before: Brereton J
Decision:
Direct that the parties bring in short minutes to give effect to this judgment, at which time the formalities attending the winding up application, any outstanding questions of quantification, costs, and any consequential matters, can be dealt with.

Catchwords:
EQUITY - Contribution - where each of two joint borrowers gives separate mortgage over separately owned parcel of land and one (plaintiff) discharges joint debt - whether right to contribution excluded by terms of deed by which parties separated their interests, whereby defendant transferred its property to plaintiff and plaintiff undertook to procure release of guarantees of defendant's debt - whether implicit that defendant would transfer its property unencumbered - where two properties secure joint debt - whether properties contribute rateably

EQUITY - Rectification - where plaintiff and defendant had equal interests in joint venture - where separation of interests proceeded on conventional basis of equality of distribution of assets and liabilities - where deed of separation mistakenly fails to give effect to that conventional basis

CORPORATIONS - External administration - winding-up - just and equitable ground
CONTRACTS - Interpretation - no question of principle.
Legislation Cited: (CTH) Corporations Act 2001, s 237
Cases Cited: Aldrich v Cooper (1803) 8 Ves 382; (1803) 32 ER 402
Re Best; Parker v Best [1924] 1 Ch 42, 44
Texts Cited: Young, Croft & Smith, On Equity
Category: Principal judgment
Parties: David Richard Hawes (first plaintiff)
Hawes Investments Pty Ltd (second plaintiff)
Trevor Laurence Dean (first defendant)
T&B Dean Investments Pty Ltd (second defendant)
Hawden Property Group Pty Ltd (third defendant)
Hawden Constructions Pty Ltd (fourth defendant)
Gallwey Pty Ltd (fifth defendant)
Representation: Counsel:
GM McGrath - plaintiffs
JE Lazarus - first, second & fifth defendants
Solicitors:
Staunton & Thompson - plaintiffs
JT Law - first, second & fifth defendants

File Number(s): 2009/ 290891

Judgment

Between 1988 and 2005, the first plaintiff and first-cross defendant David Richard Hawes, and the first defendant and first cross-claimant Trevor Laurence Dean, together engaged in approximately fifteen property development projects. They had no overarching partnership or joint venture agreement, and undertook each project as a discrete venture, utilising a variety of corporate and trust structures. One such structure was the fifth defendant Gallwey Pty Limited, in which their interests were held respectively by the second plaintiff Hawes Investments Pty Limited as the trustee of the Hawes Family Trust, and the second defendant T & B Dean Investments Pty Limited as trustee of the Dean Family Trust. For convenience and without intending any disrespect, I refer compendiously to the Hawes interests as "Hawes", and to the Dean interests as "Dean".

In 2004 to 2005, Mr Hawes and Mr Dean decided to go their separate ways. To assist in the disentanglement of their affairs, they engaged the help of their accountants, Rhodes Docherty…

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 Hawes v Dean

Details

AGLC: Hawes v Dean [2013] NSWSC 745
Case: [2013] NSWSC 745
Decision Date: 12 June 2013

CaseChat Overview and Summary

The case of Hawes v Dean involved a dispute between two parties, each of whom had a joint interest in a debt secured by separate mortgages over their individually owned properties. The plaintiff discharged the joint debt but sought contribution from the defendant, who had transferred their property to the plaintiff under a deed. The High Court of Australia was tasked with determining whether the terms of the deed precluded the plaintiff's right to contribution and if the properties contributed rateably to the joint debt.

The central legal issues were whether the deed's terms excluded the plaintiff's right to contribution, and if the two properties contributed equally to the joint debt. Additionally, the court considered whether the deed of separation mistakenly failed to reflect the conventional basis of an equal distribution of assets and liabilities between the parties.

The court found that the terms of the deed did not preclude the plaintiff's right to contribution, as there was no explicit or implicit term suggesting that the defendant would transfer their property unencumbered. The court also ruled that the properties contributed rateably to the joint debt, as they both secured the same debt. Regarding the rectification of the deed, the court concluded that the separation of interests was intended to be conventional and equal, but the deed did not accurately reflect this intention. Therefore, the deed could be rectified to better align with the parties' intentions.

The final orders included rectification of the deed to reflect the equal distribution of assets and liabilities and allowed the plaintiff to seek contribution from the defendant for the discharged joint debt.

Orders