Khong v RENOV8WITHUS PTY LTD - [2022] WADC 36

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS

LOCATION:   PERTH
CITATION:   KHONG -v- RENOV8WITHUS PTY LTD [2022] WADC 36
CORAM:   DEPUTY REGISTRAR HEWITT
HEARD:   21 APRIL 2022
DELIVERED          :   5 MAY 2022
FILE NO/S:   CIV 3692 of 2019
BETWEEN:   SUET MEI KHONG
First Plaintiff

LI RU WONG
Second Plaintiff

AND

RENOV8WITHUS PTY LTD
First Defendant

PARAMJEET SINGH KHAIRA
Second Defendant

RENOV8WITHUS PTY LTD
PARAMJEET SINGH KHAIRA
Plaintiff by counterclaim

SUET MEI KHONG
LI RU WONG
Defendant by counterclaim

Catchwords:

Practice and procedure - Application to strike out defence and counterclaim - Turns on its own facts

Legislation:

Nil

Result:

Application dismissed

Representation:

Counsel:

First Plaintiff	:	Mr C G Thorpe
Second Plaintiff	:	Mr C G Thorpe
First Defendant	:	Mr P Mendelow
Second Defendant	:	Mr P Mendelow
Plaintiff by counterclaim	:	Mr P Mendelow
Defendant by counterclaim	:	Mr C G Thorpe

Solicitors:

First Plaintiff	:	Edwards Mac Scovell Legal
Second Plaintiff	:	Edwards Mac Scovell Legal
First Defendant	:	Williams & Hughes
Second Defendant	:	Williams & Hughes
Plaintiff by counterclaim	:	Williams & Hughes
Defendant by counterclaim	:	Edwards Mac Scovell Legal

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

Nil

DEPUTY REGISTRAR HEWITT:

The matter which is before me for determination in this case is the application by the plaintiffs seeking to strike out the defence which has been filed by the defendants in its entirety or alternatively to strike out certain nominated paragraphs of that defence. The paragraphs are so numerous that in effect the second alternative is the equivalent of the first.
In order to understand my decision it is necessary to know something of the circumstances which gave rise to this case. The plaintiffs are the owners of a piece of land who entered a contract on 26 June 2018 or thereabouts with the second defendant for the completion of eight partly constructed units on their property. It was the intention of the second defendant that payments which were made pursuant to the contract which he had entered would be paid to the first defendant. The building project was the subject of a finance agreement between the plaintiffs and a financier, and that financier raised an objection to paying progress payments to any party other than the party who had entered the contract, namely the second defendant.
It therefore followed that the contract could not be fulfilled until that obstacle was overcome and consequently a Mr G Wong approached the second defendant and proposed that the difficulty should be overcome by striking out the name of the second defendant on the contract and substituting the name of the first defendant in its place. That amendment was made and the contract so amended was presented to the plaintiffs who initialled the changes which had been made. There has been some contention as to whether that process created a novation, the argument being advanced by the plaintiffs was that a novation requires three parties and the process which I have described only involves two, namely…

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: [2022] WADC 36
Decision Date

CaseChat Overview and Summary

In the District Court of Western Australia, the plaintiffs, Suet Mei Khong and Li Ru Wong, sought to strike out the defence and counterclaim filed by the defendants, RENOV8WITHUS PTY LTD and Paramjit Singh Khaira. The plaintiffs sought to dismiss the defendants' defence in its entirety or alternatively to strike out certain paragraphs of that defence. The application was heard by Deputy Registrar Hewitt on 21 April 2022 and delivered on 5 May 2022.

The legal issues before the court were whether the plaintiffs' application to strike out the defence and counterclaim should be dismissed, and whether the defence and counterclaim were sufficient to inform the plaintiffs of the issues which the defence intended to raise so that the plaintiffs had a proper opportunity to understand that defence and respond to it. The court found that the defence and counterclaim were sufficient to inform the plaintiffs of the issues which the defence intended to raise and that it was not appropriate to strike out the defence and counterclaim in whole or in part.

The court found that the facts as pleaded in the defence were capable of supporting the conclusion that a novation took place. The court also found that the real issue in the case was whether the $300,000 paid to the first defendant was in fact a deposit on account of future monies payable or whether it was in fact payment for the allocation of shares to Mr G Wong. The court found that the pleading satisfied the requirement to inform the opposing party of the issues which the defence intended to raise so that the plaintiffs had a proper opportunity to understand that defence and respond to it.

The court dismissed the application to strike out the defence and counterclaim. The court found that if there were any deficiencies in the pleading, they could be cured by a request for particulars. The court certified that the preceding paragraphs comprise the reasons for decision of the District Court of Western Australia.

Orders