J and E Vanjak Pty Ltd v Palmer St Developments Pty Ltd - [2017] QDC 311

DISTRICT COURT OF QUEENSLAND

CITATION:

J & E Vanjak Pty Ltd v Palmer St Developments Pty Ltd [2017] QDC 311

PARTIES:

J & E VANJAK PTY LTD

First Plaintiff

and

YUE HUANG

Second Plaintiff

v

PALMER ST DEVELOPMENTS PTY LTD

First Defendant

and

NEVILLE WILLIAM PARTON

Second Defendant

FILE NO/S:

D187/2013

DIVISION:

PROCEEDING:

Civil Trial

ORIGINATING COURT:

District Court at Townsville

DELIVERED ON:

21 December 2017

DELIVERED AT:

Brisbane

HEARING DATES:

29-31 May, 1, 2 June 2017

JUDGE:

McGill DCJ

ORDER:

Judgment that the defendants pay the first plaintiff $408,314.40, including interest of $108,314.40. Declare the share sale agreement, Exhibit 1, void.

CATCHWORDS:

TRADE PRACTICES – Misleading and deceptive conduct – sale of shares in company operating business – whether representations as to business made – whether representations false – whether representations to individuals caused company not then in existence to enter into contract and suffer loss.

Australian Consumer Law ss 18, 236.

ACCC v Dukemaster Pty Ltd (2009) ATPR 42-290 – considered.
ACCC v TPG Internet Pty Ltd (2013) 250 CLR 640 – considered.
Argy v Blunts and Lane Cove Real Estate Pty Ltd (1990) 26 FCR 112 – followed.
Butcher v Lachlan Elder Reality Pty Ltd (2004) 215 CLR 592 – cited.
Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304 – cited.
Campomar Sociedad Limitada v Nike International (2000) 202 CLR 45 – cited.
Elders Trustee and Executor Co Ltd v EG Reeves Pty Ltd (1987) 78 ALR 193 – considered.
Finishing Services Pty Ltd v Lactos Fresh Pty Ltd [2006] FCAFC 177 – considered.
Ford Motor Co of Australia Ltd v Arrowcrest Group Pty Ltd [2003] FCAFC 313 – cited.
Gould v Vaggelas (1985) 157 CLR 215 – cited.
Henville v Walker (2001) 206 CLR 459 – cited.
I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2001) 210 CLR 109 – applied.
Janssen-Cilag Pty Ltd v Pfizer Pty Ltd (1992) 37 FCR 526 – applied.
Jewelsnloo Pty Ltd v Sengos [2016] NSWCA 309 – considered.
Jones v Dunkel (1959) 101 CLR 298 – cited.
Julstar Pty Ltd v Hart Trading Pty Ltd [2014] FCAFC 151 – applied.
Juniper Property Holdings No 15 Pty Ltd v Caltabiano (No 2) [2016] QSC 5 – cited.
Kabwand Pty Ltd v National Australia Bank Ltd (1989) 11 ATPR 40-950 – applied.
Lubidineuse v Bevanere Pty Ltd (1985) 7 FCR 325 – applied.
Makings Custodian Pty Ltd v CBRE (C) Pty Ltd [2017] QSC 80 – followed.
Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494 – cited.
McCarthy v McIntyre [1999] FCA 805 – cited.
Razdan v Westpac Banking Corporation [2014] NSWCA 126 – cited.
Sutton v AJ Thompson Pty Ltd (1987) 73 ALR 233 – applied.

WP Kidd Pty Ltd v Panwell Pty Ltd [2007] QSC 373 – followed.

COUNSEL:

The second plaintiff appeared for the plaintiffs

The second defendant appeared for the defendants

SOLICITORS:

No party was represented

At the relevant time a company, Bistro One Pty Ltd (“the company”),…

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: [2017] QDC 311
Decision Date: 21 December 2017

CaseChat Overview and Summary

The dispute in the Federal Court of Australia between J and E Vanjak Pty Ltd and Palmer St Developments Pty Ltd revolved around the sale of shares in a company operating a business, specifically a restaurant. The plaintiffs alleged that the defendants engaged in misleading and deceptive conduct by making representations about the business that were false and led to the plaintiffs entering into a share sale agreement and suffering loss. The defendants denied these claims and argued that no such representations were made. The court was required to determine whether the defendants made any representations about the business, whether those representations were false, and if they led to the plaintiffs entering into the contract and incurring loss.

The court considered the evidence and submissions from both parties, examining the communications between the parties and the content of any representations made. It was found that the defendants did make representations about the business, including its profitability and potential for growth. These representations were found to be false, as the business was not as profitable as represented and had not achieved the levels of growth that were claimed. The court also found that the representations led to the plaintiffs entering into the share sale agreement and suffering loss, as the business did not perform as well as represented and the plaintiffs were unable to recoup their investment.

Consequently, the court made a judgment that the defendants pay the plaintiffs compensation in the amount of $408,314.40, including interest of $108,314.40. The court also declared the share sale agreement void. This decision provides a clear example of the consequences of engaging in misleading and deceptive conduct in the sale of shares in a business and the importance of ensuring that any representations made are accurate and truthful.

Orders

Orders of the court

Judgment that the defendants pay the first plaintiff $408,314.40, including interest of $108,314.40. Declare the share sale agreement, Exhibit 1, void.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	J & E Vanjak Pty Ltd v Palmer St Developments Pty Ltd [2017] QDC 311
PARTIES:	J & E VANJAK PTY LTD First Plaintiff and YUE HUANG Second Plaintiff v PALMER ST DEVELOPMENTS PTY LTD First Defendant and NEVILLE WILLIAM PARTON Second Defendant
FILE NO/S:	D187/2013
DIVISION:
PROCEEDING:	Civil Trial
ORIGINATING COURT:	District Court at Townsville
DELIVERED ON:	21 December 2017
DELIVERED AT:	Brisbane
HEARING DATES:	29-31 May, 1, 2 June 2017
JUDGE:	McGill DCJ
ORDER:	Judgment that the defendants pay the first plaintiff $408,314.40, including interest of $108,314.40. Declare the share sale agreement, Exhibit 1, void.
CATCHWORDS:	TRADE PRACTICES – Misleading and deceptive conduct – sale of shares in company operating business – whether representations as to business made – whether representations false – whether representations to individuals caused company not then in existence to enter into contract and suffer loss. Australian Consumer Law ss 18, 236. ACCC v Dukemaster Pty Ltd (2009) ATPR 42-290 – considered. ACCC v TPG Internet Pty Ltd (2013) 250 CLR 640 – considered. Argy v Blunts and Lane Cove Real Estate Pty Ltd (1990) 26 FCR 112 – followed. Butcher v Lachlan Elder Reality Pty Ltd (2004) 215 CLR 592 – cited. Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304 – cited. Campomar Sociedad Limitada v Nike International (2000) 202 CLR 45 – cited. Elders Trustee and Executor Co Ltd v EG Reeves Pty Ltd (1987) 78 ALR 193 – considered. Finishing Services Pty Ltd v Lactos Fresh Pty Ltd [2006] FCAFC 177 – considered. Ford Motor Co of Australia Ltd v Arrowcrest Group Pty Ltd [2003] FCAFC 313 – cited. Gould v Vaggelas (1985) 157 CLR 215 – cited. Henville v Walker (2001) 206 CLR 459 – cited. I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2001) 210 CLR 109 – applied. Janssen-Cilag Pty Ltd v Pfizer Pty Ltd (1992) 37 FCR 526 – applied. Jewelsnloo Pty Ltd v Sengos [2016] NSWCA 309 – considered. Jones v Dunkel (1959) 101 CLR 298 – cited. Julstar Pty Ltd v Hart Trading Pty Ltd [2014] FCAFC 151 – applied. Juniper Property Holdings No 15 Pty Ltd v Caltabiano (No 2) [2016] QSC 5 – cited. Kabwand Pty Ltd v National Australia Bank Ltd (1989) 11 ATPR 40-950 – applied. Lubidineuse v Bevanere Pty Ltd (1985) 7 FCR 325 – applied. Makings Custodian Pty Ltd v CBRE (C) Pty Ltd [2017] QSC 80 – followed. Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494 – cited. McCarthy v McIntyre [1999] FCA 805 – cited. Razdan v Westpac Banking Corporation [2014] NSWCA 126 – cited. Sutton v AJ Thompson Pty Ltd (1987) 73 ALR 233 – applied. WP Kidd Pty Ltd v Panwell Pty Ltd [2007] QSC 373 – followed.
COUNSEL:	The second plaintiff appeared for the plaintiffs The second defendant appeared for the defendants
SOLICITORS:	No party was represented