Kanagaratnam v Ghaneshan

[2018] QDC 230

DISTRICT COURT OF QUEENSLAND

CITATION:

Kanagaratnam & another v Ghaneshan & another [2018] QDC 230

PARTIES:

NIRMALANANDAN SOMASUNDRAM KANAGARATNAM

and

RANI LAKSHANTHI JAYASINGHE

(applicants)

v

THARANGA GHANESHAN

(first respondent)

GHAJAN GHANESHAN

(second respondent)

FILE NO/S:

3642/18

DIVISION:

Civil

PROCEEDING:

Application

ORIGINATING COURT:

District Court

DELIVERED ON:

13 November 2018

DELIVERED AT:

Brisbane

HEARING DATE:

8 November 2018

JUDGE:

Richards DCJ

ORDER:

Application for stay is granted. The applicant is ordered to pay the respondents costs of and incidental to the application to be assessed unless otherwise agreed.

CATCHWORDS:

APPEAL AND NEW TRIAL – QUEENSLAND – STAY OF PROCEEDINGS – where the applicants loaned the respondents money through an oral agreement – where there is no agreement between the parties about the court or place in which the proceeding should be started - where the initial loan was made in Melbourne – where the applicants live in Queensland – whether the application should be stayed.  

COUNSEL:

JP Morris for the applicants 

Mr S Hogg for the respondents

SOLICITORS:

Johnsons Solicitors for the Applicants

George Liberogiannis & Associates for the respondents

1. The applicants seek judgment in respect of funds loaned to the respondents which have not been repaid.

1. In July 2013 the respondents, who were friends of the applicants, approached the applicants and asked whether they were willing to provide a loan to assist the respondents in their business. Initially they lent them $40,000 at an interest rate of 2 per cent per month.  The agreement was oral.  It was anticipated the loan would be repaid quickly.

1. Between 2013 and 2016 the respondents made regular interest payments and some capital repayments and they continued to request further loans.

1. By early 2018 the respondents owed the applicants $150,000. Interest payments were being made but the capital sum was not being reduced.  Discussions occurred between the applicants and the first respondent whereby it was decided that if they were to lend any more money there had to be a written agreement.

1. It is common ground that a no security loan agreement was entered into around 4 April 2018. 

1. The respondents went to the applicants’ lawyer’s office in Victoria and executed the agreement on 10 April 2018.

1. On or about 9 April 2018 the second respondent contacted the applicant and asked to borrow $90,000 to buy machinery for his business. He agreed to do so and lent him the money.  It was expected that the money would be paid back on a settlement of a property in Sri Lanka. 

1. On or about 25 June 2018 the first respondent contacted the applicant saying she urgently needed a short term loan of $10,000 for three days.  That money was provided.  It is accepted by the first respondent that she owes $40,000 and $10,000 to the applicant however, any further borrowings are denied.  This is despite the existence of the written agreement. It is suggested in the affidavit of the first respondent that the agreement annexed to the applicant’s affidavit may differ from that which they signed.

Application for stay

1. At the hearing of this matter oral application was made for a stay pursuant to s20 of the Service and Execution of Process Act 1992 (Cth) on the basis that the correct forum for this matter is Victoria. Section 20 of the Act states:

“…

(3)         The court may order that the proceeding be stayed if it is   satisfied that a court of another State that has jurisdiction to                determine all the matters in issue between the parties is the   appropriate court to determine those matters.

(4)         The matters that the court is to take into account in   determining whether that court of another State is the   appropriate court for the proceeding include:
             (a)       The places of residence of the parties and of the    witnesses likely to be called in the proceeding; and
             (b)       The place where the subject matter of the proceeding   is situated; and
             (c)       The financial circumstances of the parties, so far as    the court is aware of them; and

(d)  Any agreement between the parties about the court or place in which the proceeding should be instituted; and

(e)  The law that would be most appropriate to apply in the proceeding; and

(f)        Whether a related or similar proceeding has been    commenced against the person served or another   person;
But do not include the fact that the proceeding was commenced in the place of issue.”

1. In this case the transactions that resulted in the loan agreement of April 2018 took place over a number of years from mid to late 2013 to mid-2018.  The respondents were at all times resident in Melbourne.  The applicants lived in Melbourne from 2011 until sometime in 2014.  The first of the loans for $40,000 was negotiated through July and August 2013 and paid in early September 2013 so the whole transaction took place in Victoria.

1. On dates unknown between late 2013 and 2016 there were further borrowings.  It is unclear whether for some of that time the applicants were still in Victoria or whether they had moved by that stage to Queensland but the respondents remained in Victoria so that if funds were shifted from Queensland electronically either they were sent to Victoria by way of payment.  Ultimately the agreement was signed with Melbourne solicitors, drawn up by Melbourne solicitors, signed by the respondents with Melbourne solicitors.  The respondents are challenging that agreement so clearly those solicitors are likely to become involved in the dispute and will have to give evidence in a trial if it comes to that. 

1. It follows therefore that some of the witnesses will be in Queensland (the applicants), the respondents live in Melbourne and it is likely that at least one solicitor will be called from Victoria.  The place where at least the initial loan was made was in Melbourne. There may have been other loans conducted in Melbourne but thereafter once the applicants moved to Queensland negotiations took place between Victoria and Queensland. There is no evidence of the financial circumstances of the parties.  There is no agreement between the parties about the court or place in which the proceeding should be instituted. The law in relation to both the jurisdictions is the same.  There are no related or similar proceedings that have been commenced against the person served or another person.

1. In my view, there are obvious reasons why the matter could be heard in Queensland namely the presence of the applicants in Queensland, the fact that they conducted their business or the transactions out of Queensland, but there are equally reasons why the matter could be transferred to Victoria.  The fact that at least one of the loans occurred wholly within Victoria in my view tips the balance that the true forum is Victoria.

1. It is ordered that the application be stayed. The applicant is ordered to pay the respondents costs of and incidental to the application to be assessed unless otherwise agreed.