Legal Research
Cases
Klement v Pencoal Limited

Klement v Pencoal Limited

Case [1999] QSC 90 23 April 1999

Unconscionable Conduct

Type to search within this case.

IN THE SUPREME COURT
OF QUEENSLAND

No. 1469 of 1992

Brisbane
Before the Hon. Mr Justice Derrington
[Klement v Pencoal Limited & Ors ]
BETWEEN:
  KOLOMAN KLEMENT
  Plaintiff
AND:
  PENCOAL LIMITED
  First Defendant
AND:
  SOUTH BLACKWATER COAL LIMITED
  (ACN 011 026 154)
  Second Defendant
AND:
  IAN RUSSELL GOULD
  Third Defendant
AND:
  JOHN CHARLES CRIDLAND
  Fourth Defendant
AND:
  THEODORE PAUL LINDNER
  Fifth Defendant
REASONS FOR JUDGMENT - DERRINGTON J

Judgment delivered on 23 April 1999

The Claims

The plaintiff was the registered lessee with the fifth defendant as tenants in common in equal shares over the mining lease and an associated special lease and mining information which were the subject of an option agreement and a resulting sale to the first defendant who subsequently sold them to the second defendant, which is the current lessee. The plaintiff alleges that the signature on the respective documents of transfer to the first defendant which purported to be his are forgeries and that consequently the registration of the transfer of title and subsequent dealings are all invalid and ineffective to transfer his interest in such leases. Consequent upon this he claims that the second defendant holds one half of its interest in each of the leases on trust for him and seeks rectification of the registers. He also claims to have a similar half interest in the associated mining information.
The third and fourth defendants are the officers in charge of and having control of the respective registers on which the titles of the lessee are endorsed, and they have indicated their willingness to abide by the decision of the court without participation in the trial.
The plaintiff seeks damages against the first and fifth defendants for conversion of his interest in such property or alternatively that the first and second defendant be declared trustees for him in respect of their respective holding of what had been his title in this property, with consequential relief. He also asks for an account against the first, second and fifth defendants or alternatively as against the fifth defendant that he pay to the plaintiff a one half share in the sum of $1,010,000.00 received by him in respect of the option and subsequent sale of the property. He also asks for interest.
In the alternative, he claims against the first defendant for specific performance of any contract binding on him or in the alternative the sum of $500,000.00 and interest representing his one half share of the purchase money payable under such contract.
The fifth defendant counterclaims for his share of the proceeds of the sale of certain items of plant and equipment sold by the plaintiff under a joint venture between them. He further seeks a declaration that the plaintiff agreed to compromise any claim in respect of the proceeds of the sale of the said leases and associated property. He also asks for equitable compensation for breach of fiduciary duty and an account of their joint venture dealings.
The History and The…

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.

Continue reading Klement v Pencoal Limited

Details

AGLC: Klement v Pencoal Limited [1999] QSC 90
Case: [1999] QSC 90
Decision Date: 23 April 1999

CaseChat Overview and Summary

In the case of Klement v Pencoal Limited, the plaintiff Koloman Klement sued several defendants, including Pencoal Limited, for the fraudulent sale of mining leases and mining information. Klement claimed that his signature on the documents transferring the leases to Pencoal was forged and that the sale was invalid. Pencoal argued that Klement had authorised its agent, Lindner, to act on his behalf and that the sale was valid. The court had to determine whether Klement was bound by Lindner's actions and whether the sale was valid.

The court found that Lindner was Klement's agent with wide authority to conduct the transaction on his behalf. Klement had given Lindner an authority to act on his behalf, even if it was not a power of attorney. Klement had also intended for Lindner to present signed documents to Pencoal as part of the settlement. Therefore, the court held that Klement was bound by Lindner's actions, including the presentation of the forged transfer documents, and that the sale was valid.

Even if the court had not found that Klement authorised Lindner to present the forged documents, the court held that Klement was estopped from denying the validity of his signature or that Lindner had authority to act on his behalf. Klement knew of the forgery but did nothing to prevent it, and his inactivity amounted to ratification of Lindner's conduct.

As a result, the court dismissed Klement's claims against Pencoal and the other defendants. However, the court found that Klement was entitled to recover $723,881.00 from Lindner, representing Klement's half share of the proceeds of the sale, less expenses, and plus interest. The court reserved the question of costs for further argument and adjourned any further issues of accounts between Klement and Lindner.

Orders