JT Nominees Pty Ltd v Macks

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SUPREME COURT OF SOUTH AUSTRALIA

(Civil: Application)

JT NOMINEES PTY LTD v MACKS

[2007] SASC 151

Reasons for Decision of The Honourable Justice Bleby

2 May 2007

PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - PROCEDURE UNDER RULES OF COURT - SUMMARY JUDGMENT

Application by the defendant for summary judgment pursuant to rule 232(2)(b) of Supreme Court Rules 2006 – Interpretation of Rule 232(2)(b) and its predecessors – Meaning of “no reasonable basis for the (plaintiff’s) claim” – Consideration of authorities – Discussion of relevant considerations to determine whether summary judgment is appropriate – Held: appropriate case for summary determination.

EQUITY - GENERAL PRINCIPLES - ASSIGNMENTS IN EQUITY - WHAT AMOUNTS TO AN EQUITABLE ASSIGNMENT

Claim for a declaration that the plaintiff as assignee is entitled to the beneficial interest in a deceased estate – Beneficial interest vested after death of alleged assignor – Assignor’s estate bankrupt – Alternative claim for a declaration that trustee in bankruptcy holds the beneficial interest on constructive trust for the plaintiff – Agreement between alleged assignor and the plaintiff as security for liability of alleged assignor under alleged guarantee to the plaintiff – Whether agreement contemplates absolute assignment or assignment by way of charge – Nature of assignment by equitable charge – Whether agreement constitutes an immediate assignment or an agreement to assign – Whether agreement to assign vests beneficial interest in the plaintiff – Whether principle in Holroyd v Marshall applies – Whether consideration paid or provided – Held: no beneficial interest vested in the plaintiff – Claim dismissed.

Stamp Duties Act 1923 (SA), s 22; Supreme Court Civil Rules 2006 (SA), r 4, 104, 117, 117(2)(e), 118, 193, 232; Supreme Court Rules 1987 (SA), r 25, 46.18; Bankruptcy Act 1966 (Cth), s 249(3); Supreme Court Act 1935 (SA), s 23(1); Instruments Act 1958 (Vic), Part IX; Companies Act 1958 (Vic), s 72; Supreme Court Rules (1947) (SA), O 10, r 1, r 4, O 25, r 4; High Court Rules O 26, r 18; Uniform Civil Procedure Rules 1999 (Qld), r 292 and 293; Federal Court of Australia Act 1976 (Cth), s 31A; Judiciary Act 1903 (Cth), s 25A; Federal Magistrates Act 1999 (Cth), s 17A, referred to.
Holroyd v Marshall (1862) 10 HLC 91; 11 ER 999; Tailby v Official Receiver (1888) 13 AC 523; Re Row Dal Constructions Pty Ltd (In Liquidation) [1966] VR 249, applied.
General Steel Industries Inc v Commissioner for Railways (NSW) & Ors (1964) 112 CLR 125; Fancourt & Anor v Mercantile Credits Limited (1983) 154 CLR 87, distinguished.
Gray v Morris [2004] 2 QdR 118, not followed.
Chapman & Chapman v Australian Broadcasting Corporation (2000) 77 SASR 181; Bernstrom v National Australia Bank Limited [2003] 1 Qd R 469; Swain v Hillman [2001] 1 All ER 91; Deputy Commissioner for Taxation v Salcedo [2005] 2 QdR 232; The State of South Australia and the Australian Formula One Grand Prix Board v The Corporation of the Town of Hindmarsh, unreported,…

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Details
Case
[2007] SASC 151
Decision Date

CaseChat Overview and Summary

In the matter of JT Nominees Pty Ltd v Macks, the plaintiff, JT Nominees, sought a declaration that it was entitled to the beneficial interest in the estate of a deceased individual, following an alleged assignment. The defendant, Macks, applied for summary judgment, arguing that there was no reasonable basis for the plaintiff’s claim. The case was heard in the Supreme Court of South Australia, which was required to interpret Rule 232(2)(b) of the Supreme Court Rules 2006, concerning the conditions under which summary judgment could be granted. The court also had to determine whether the plaintiff had a valid equitable assignment of the beneficial interest in the estate.

The central legal issue was the interpretation of Rule 232(2)(b) and whether it applied to the facts of this case, specifically if there was no reasonable basis for the plaintiff’s claim. The court needed to assess whether the plaintiff had a valid equitable assignment of the beneficial interest in the estate and whether the agreement between the alleged assignor and the plaintiff constituted an absolute assignment or an assignment by way of charge. Another issue was whether the principle in Holroyd v Marshall applied, and whether there was consideration for the alleged assignment.

The court found that the application for summary judgment was appropriate in this case. The interpretation of Rule 232(2)(b) was considered, along with relevant authorities. The court concluded that the plaintiff did not have a beneficial interest in the estate, as the agreement did not constitute an absolute assignment. The court also held that the agreement did not amount to an equitable assignment by way of charge, as there was no consideration provided for the assignment. Therefore, the plaintiff's claim for a declaration that it was entitled to the beneficial interest was dismissed.

The final orders of the court were that the defendant's application for summary judgment was granted, and the plaintiff's claim for a declaration that it was entitled to the beneficial interest in the estate was dismissed. The court found that there was no reasonable basis for the plaintiff’s claim, and accordingly, the action was disposed of summarily.

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

If that is the effect of the statement of claim there is no inconsistency with the present plaintiff’s defence pleaded in the other action. It is not necessary to refer to details, but those pleadings, insofar as they relate to dealings with the beneficial interest, are entirely consistent with the present statement of claim. In my opinion there is no substance in the defendant’s first alternative. I am therefore relieved of the need to decide whether only the pleading[5] or the whole action[6] should be struck out on that ground.[5] Rules 104 and 117.[6] Rules 117 and 193.The application for summary judgment That brings me to the principal relief claimed by the defendant, namely a claim for summary judgment pursuant to r 232(2)(b) of the 2006 Rules. Rule 232, although not in the same terms, is the successor in the 2006 Rules to r 25.02 (claim for summary judgment by a plaintiff) and r 25.04 (claim for summary judgment by a defendant) of the 1987 Rules. Those rules were in turn based on the provisions of O 10 r 1 of the Supreme Court Rules, as they were then known (“the 1947 Rules”). For an explanation of the differences see Settlement Wine Co Pty Ltd v National & General Insurance Co Ltd.[7][7] (1988) 143 LSJS 398, and on appeal, (1988) 146 LSJS 150. See also Lawrence v Griffiths & Anor (1987) 47 SASR 455. It is clear that the remedy of summary judgment is discretionary. Unlike rules which allow a pleading or proceedings to be struck out where a pleading discloses no reasonable cause of action, consideration of the application is not limited to the pleadings. The court must make an assessment of both matters of fact and of law. The application will usually be decided on affidavits and by reference to documents referred to in the pleadings, although in some cases it may be necessary or desirable to hear brief oral evidence. In this case, the plaintiff filed an affidavit exhibiting a copy of the agreement on which the plaintiff relies in the action and exhibiting the correspondence already referred to. The plaintiff did not seek to lead any other evidence of events relevant to what had been done under the agreement. The defendant did, but only as to the receipt and banking of the cheques representing the beneficial interest. Before turning to a consideration of the merits of the defendant’s application, it is necessary to consider the proper interpretation of r 232(2)(b) of the 2006 Rules.The interpretation of Rule 232(2)(b) The rule has its origin in O 10 of the 1947 Rules. Order 10 r 1 allowed a plaintiff or defendant to apply to a Judge for “any relief which he claims or to dispose of the action summarily”. No other criteria were specified. Under O 10 r 4 the court was able to make “an order that judgment be entered for the plaintiff or defendant (as the case may be) for the relief claimed, or such portion thereof, or such other relief or declaration as may be just, or otherwise disposing of the action, or of any issue or question in the action”.

Ratio Decidendi

Legal Principle Established

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