Jacques v Forte Enterprises Pty Ltd

In this case, the plaintiff, Jacques, sought damages against Forte Enterprises Pty Ltd, a partnership of which Jacques was a partner. The dispute arose from a situation where the defendant, Forte Enterprises, had received an offer to purchase partnership property. Jacques claimed that Forte Enterprises failed to explore and potentially finalise this offer, resulting in financial loss to the partnership. The matter was heard in the Federal Court of Australia.

The central legal issues that the court needed to address were whether Forte Enterprises breached its fiduciary duty by not disclosing a potential conflict of interest and whether Jacques was entitled to damages for the alleged breach. The court also had to determine the appropriate method for assessing damages in this context, including any applicable discounts due to uncertainties.

The court found that Forte Enterprises had indeed breached its fiduciary duty by not disclosing a potential conflict of interest, as one partner had a personal interest in the proposed purchaser. The court held that the onus of proving fully informed consent lies with the fiduciary and, in this case, there was no evidence that the conflict of interest was disclosed. The court further noted that the plaintiff's obtaining of independent legal representation did not discharge this onus. Regarding damages, the court concluded that a 35 per cent discount was appropriate to account for uncertainties such as the possibility of reaching an agreement and potential financing obstacles.

The court ordered Forte Enterprises to pay Jacques damages for the loss suffered, applying a 35 per cent discount to account for uncertainties in the assessment. This discount reflected the potential difficulties in reaching an agreement and securing financing for the sale.