Hollins v Qbit Trading Pty Ltd - [2020] WADC 7

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION:   PERTH
CITATION:   HOLLINS -v- QBIT TRADING PTY LTD [2020] WADC 7
CORAM:   PRINCIPAL REGISTRAR MELVILLE
HEARD:   13 DECEMBER 2019
DELIVERED          :   16 JANUARY 2020
FILE NO/S:   CIV 2036 of 2019
BETWEEN:   CRAIG ANTHONY HOLLINS
Plaintiff
AND
QBIT TRADING PTY LTD
First Defendant
UPTIME COMPUTER MANAGEMENT PTY LTD
Second Defendant
DAVID MUSARRA
Third Defendant
FABIO SUFFELL
Fourth Defendant

Catchwords:

Application to strike out statement of claim - Duties to unrepresented litigant - Lifting the corporate veil

Legislation:

Rules of the Supreme Court 1971 (WA)

Result:

Plaintiff refused leave to file the proposed statement of claim

Representation:

Counsel:

Plaintiff	:	In Person
First Defendant	:	Mr C S Williams
Second Defendant	:	Mr C S Williams
Third Defendant	:	Mr C S Williams
Fourth Defendant	:	Mr C S Williams

Solicitors:

Plaintiff	:	Not applicable
First Defendant	:	Solomon Brothers
Second Defendant	:	Solomon Brothers
Third Defendant	:	Solomon Brothers
Fourth Defendant	:	Solomon Brothers

Case(s) referred to in decision(s):

Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union of Workers - Western Australian Branch v Bell-A-Bike Rottnest Pty Ltd [2005] WASCA 157
Bertola v Australian and New Zealand Banking Group Ltd [2016] WASC 165
Day v William Hill (Park Lane) Ltd [1949] 1KB 632
Morgan v 45 Flers Avenue Pty Ltd (1986) 10 ACLR 692
Mutual Life & Citizens Assurance Co Ltd v Evatt (1970) 122 CLR 628
Prest v Petrodel Resources Ltd [2013] UKSC 34
Southern Wine Corporations Pty Ltd (in liq) v Frankland River Olive Co Ltd [2005] WASCA 236

PRINCIPAL REGISTRAR MELVILLE:

Background

On 4 June 2019 the plaintiff commenced proceedings against the four defendants by way of a generally indorsed writ of summons. On 24 June 2019 the plaintiff filed a statement of claim and on 5 July 2019 the third and fourth defendants applied to the court by way of chamber summons seeking an order that the statement of claim be struck out. On 12 July 2019 Registrar Hewitt ordered that the first and second defendants be joined as applicants to the application to strike out the statement of claim, that the name of the first defendant be amended to QBit Trading Pty Ltd and that the name of the second defendant be amended to Uptime Computer Management Pty Ltd.
The summons failed to comply with the Rules of the Supreme Court1971 (WA) (RSC) at O 20 r 19(3)(b). However, the plaintiff has not taken issue with this and it is apparent from the outline of submissions filed by the defendants in support of their application that application is made on the basis:
1.The issues raised in the statement of claim have already been decided against the plaintiff in Supreme Court action 2945 of 2015 and that therefore the plaintiff is barred from now bringing same issues before this court by reason of the doctrine of res judicata, cause of action estoppel, issue estoppel and/or Anshun estoppel.
2.That the statement of claim fails to…

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

Case: [2020] WADC 7
Decision Date: 16 JANUARY 2020

CaseChat Overview and Summary

In Hollins v Qbit Trading Pty Ltd, the applicant sought leave to file an amended statement of claim against the respondent. The applicant's claim involved several causes of action, including the repayment of money and compensation for the termination of employment. The primary legal issues in the case involved whether the court should permit the filing of the amended statement of claim and whether certain affidavit evidence could be considered in the context of the application to strike out.

The court considered the admissibility of affidavit material in the context of an application to strike out. It noted that generally, affidavit evidence is not admissible on the basis that the pleading does not disclose a cause of action. However, affidavit evidence may be considered if it supports other grounds for striking out the claim, such as those outlined in RSC O 20 r 19(1). In this case, the affidavit included emails and documents that were referenced in the proposed amended statement of claim, which the court deemed permissible.

The court concluded that the proposed statement of claim did not adequately disclose a cause of action, particularly regarding the claim for compensation for unlawful termination of employment. The statement of claim lacked particulars required by the pleading rules, such as those necessary to establish the claim for termination of employment. The court also noted the absence of a Trust Deed, which was referenced in the business succession agreement but not provided. These deficiencies meant that the plaintiff's claims were not sufficiently particularised.

Accordingly, the court dismissed the application to file the amended statement of claim. The court ordered that the application be struck out on the basis that the pleading did not disclose a cause of action and lacked the necessary particulars.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

Generally affidavit material is not admissible on an application to strike out on the basis the pleading does not disclose a cause of action.[1] However, a document referred to in a pleading may be placed before the court by way of an affidavit.[2] Affidavit evidence is otherwise admissible to support an application strike out on the other grounds set out in RSC O 20 r 19(1).[1] RSC O 20 r 19(1)(a).[2] Southern Wine Corporations Pty Ltd (in liq) v Frankland River Olive Co Ltd [2005] WASCA 236 [51]; Day v William Hill (Park Lane) Ltd [1949] 1KB 632 [639]. This affidavit annexes a series of emails whereby the plaintiff provided to the defendants' solicitors various iterations of an amended statement of claim attempting to address issues of concern that had been raised previously by the defendants' solicitors between the period 18 September 2019 and 18 October 2019. It also annexes a copy of the 'business succession agreement' referred to in the final version of the statement of claim for which the plaintiff now seeks leave to file ('the BSA'). The special conditions of the BSA at item 14 of sch 1 provide:The Trustee and the Trust deed forms part of this agreement and a copy of which is now annexed to the Fourth Schedule (the 'Trust Deed').However, no such Trust Deed is annexed to the Fourth Schedule. This affidavit again annexes a series of email communications between the parties between the period 6 December 2019 and 12 December 2019. It also annexes at page 24 the current version of the statement of claim the plaintiff now seeks leave to file dated 3 December 2019. The proposed statement of claim seeks to plead four causes of action constituted by or in relation to:(a)the repayment of $171.60 taken from the plaintiff's personal Lotterywest account by the third and fourth defendants;(b)$50,000 by way of compensation for the unlawful termination of his employment contract by the first and second defendants;(c)the repayment of $75,104.50 being the balance of monies allegedly loaned by the plaintiff to the first defendant; and(d)the sum of $474,814.33 being the difference between a fair valuation of the Hollins Family Pty Ltd interest in the Qbit Trading Trust and what in fact the defendants paid for it. In his prayer for relief the plaintiff seeks orders for payments of the above amounts and alternatively;(a)specific performance; and(b)damages to be assessed. By the RSC O 20 r 8 the statement of claim is required to contain, and contain only, a statement in a summary form of the material facts, the material facts being those facts essential to establishing the cause of action. Rule 8(2) goes on to provide that the effect of any document referred to in the pleading must, if material, be briefly stated. Whilst the pleading rules require the pleading in summary form of material facts, given the purpose served by the rules of pleading and the requirement to file a statement of claim, the pleading must nevertheless contain the necessary particulars of any claim so as to enable the reader, and in this case the defendants, to understand the nature of the case being brought against them. Order 20 r 13 provides, without prejudice to the generality of the above:Where a party pleading alleges any condition of the mind of any person, whether any disorder or disability of mind or any malice, fraudulent intention or other condition of mind, except knowledge, particulars of the facts on which the party relies must be pleaded.