KPG Australia Pty Ltd v Hi-8 Group (Aust) Pty Ltd
[2001] WASC 341
KPG AUSTRALIA PTY LTD -v- HI-8 GROUP (AUST) PTY LTD [2001] WASC 341
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2001] WASC 341 | |
| Case No: | CIV:2372/2001 | 5 DECEMBER 2001 | |
| Coram: | MASTER SANDERSON | 14/12/01 | |
| 6 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| B | |||
| PDF Version |
| Parties: | KPG AUSTRALIA PTY LTD (ACN 052 101 381) HI-8 GROUP (AUST) PTY LTD (ACN 093 713 841) |
Catchwords: | Summary judgment Turns on own facts |
Legislation: | Nil |
Case References: | Nil Aequitas v AEFC (2001) 19 ACLC 1006 Attorney-General for Hong Kong v Reid [1994] 1 AC 324 Bank fur Gemeinwirtschaft v City of London Garages (1971) 1 All ER 541 Chasfield Pty Ltd v Taranto, unreported; SCt of Vic; 9 June 1988 Eng Mee Yong v V Letchumanan s/o Velayutham [1980] AC 331 General Credits (Finance) Pty Ltd v Shipton Holdings Pty Ltd, unreported; SCt of WA; Library No 2054; 19 May 1977 Hovenden & Sons v Millhoff (1900) 83 LT 41 Logicrose Ltd v Southend United FC Ltd [1988] 1 WLR 1257 Miles v Bull [1969] 1 QB 258 Moscow Narodny Bank Ltd v Mosbert Finance (Aust) Pty Ltd [1976] WAR 109 Panama & South Pacific Telegraph Company v India Rubber Gutta Percha & Telegraphs Works Co (1875) LR 10 Ch App 515 Re a Debtor [1927] 2 Ch 376 Taylor v Walker [1958] 1 Lloyd's Rep 490 Transval Lands Co v New Belgium (Transval) Land and Development Co [1914] 2 Ch 488 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
HI-8 GROUP (AUST) PTY LTD (ACN 093 713 841)
Defendant
Catchwords:
Summary judgment - Turns on own facts
Legislation:
Nil
Result:
Application dismissed
(Page 2)
Category: B
Representation:
Counsel:
Plaintiff : Mr P B O'Neal
Defendant : Mr C L Zelestis QC
Solicitors:
Plaintiff : Deacons
Defendant : Jackson McDonald
Case(s) referred to in judgment(s):
Nil
Case(s) also cited:
Aequitas v AEFC (2001) 19 ACLC 1006
Attorney-General for Hong Kong v Reid [1994] 1 AC 324
Bank fur Gemeinwirtschaft v City of London Garages (1971) 1 All ER 541
Chasfield Pty Ltd v Taranto, unreported; SCt of Vic; 9 June 1988
Eng Mee Yong v V Letchumanan s/o Velayutham [1980] AC 331
General Credits (Finance) Pty Ltd v Shipton Holdings Pty Ltd, unreported; SCt of WA; Library No 2054; 19 May 1977
Hovenden & Sons v Millhoff (1900) 83 LT 41
Logicrose Ltd v Southend United FC Ltd [1988] 1 WLR 1257
Miles v Bull [1969] 1 QB 258
Moscow Narodny Bank Ltd v Mosbert Finance (Aust) Pty Ltd [1976] WAR 109
Panama & South Pacific Telegraph Company v India Rubber Gutta Percha & Telegraphs Works Co (1875) LR 10 Ch App 515
Re a Debtor [1927] 2 Ch 376
Taylor v Walker [1958] 1 Lloyd's Rep 490
Transval Lands Co v New Belgium (Transval) Land and Development Co [1914] 2 Ch 488
(Page 3)
1 MASTER SANDERSON: This is the plaintiff's application for summary judgment. Given that I have concluded that the application ought be dismissed it is not appropriate that I provide detailed reasons which might suggest some findings as to the facts. However, in deference to the strong argument raised by the plaintiff it is appropriate that I briefly outline why I have reached the conclusion the application should fail.
2 The starting point is the amended statement of claim. After identifying the parties (par 1 and par 2) it is pleaded that at all material times the plaintiff was the registered proprietor of certain property at 4-16 Bennett Street, East Perth ("the property"). By par 4, par 5 and par 6 of the amended statement of claim it is pleaded that on 15 November 2000 the defendant entered into an offer and acceptance pursuant to which it committed to purchase the property. The purchase price was $3,700,000. Other relevant terms of the contract are pleaded. It is said (by par 7) that the defendant failed to complete the purchase, that a notice of demand was issued (par 8) and ignored (par 9) and that on 18 April 2001 the plaintiff terminated the contract (par 10). By par 11 through to par 14, it is pleaded that the plaintiff then sold the property for an amount less than the contract price and that as a consequence the plaintiff has suffered loss and damage. The amount of the plaintiff's claim is $561,641.79.
3 The application is supported by an affidavit of Peter Patrick William Ratty sworn 4 October 2001, which verifies the amended statement of claim as is required by O 14 r 2(1). The technical requirements of the summary judgment application have been met; there was no suggestion to the contrary by the defendant. On the face of it then, the plaintiff's claim appears straightforward and unanswerable. In fact, the defendant conceded that it was not in a position to establish that there was an issue or question in dispute which ought to be tried. Rather, it was submitted that there was "some other reason" to allow the action to proceed to trial: See O 14 r 3(1).
4 In opposition to the application the defendant relied upon three affidavits of Gianfranco Rasile ("Rasile"), the first sworn 12 November 2001, the second sworn 23 November 2001 and the third sworn 3 December 2001. Rasile is an architect and was at all material times a director of the defendant. Also a director of the defendant at the relevant times was Francis Hon Meng Choy ("Choy"). Rasile and Choy had been involved with plans to develop certain property in the central Perth precinct and had consequently become acquainted. Rasile details their business relationship in par 1 through to par 30 of his first affidavit. I need not go into detail as to this relationship, save to note that the
(Page 4)
- defendant was incorporated on 7 August 2000 and both Rasile and Choy became directors. In early November 2000, Rasile says that Choy drew his attention to the property. Rasile says that Choy advised him that the property was for sale at between $4 million and $4,500,000, but he (Rasile) thought the property was worth perhaps $3 million. Choy was authorised to negotiate with the plaintiff on behalf of the defendant. Choy undertook these negotiations with one John Giovanni Abrusci ("Abrusci"), an officer of the plaintiff. It emerged that the plaintiff would accept no less than $3,700,000 for the property. At this point, Rasile and another director of the defendant instructed Choy that he was to have no further dealings with the plaintiff and Abrusci prior to Rasile, on behalf of the defendant, conducting final negotiations. In fact, it is clear that Choy and Abrusci did meet prior to negotiations taking place between Choy, Rasile and Abrusci which finally led to the offer and acceptance being signed. Subsequently, in December 2000 a finance clause which would have allowed the defendant to escape the contract was waived. Rasile says that this was done at the urging of Choy (see par 78 and par 81 of Rasile's first affidavit). Eventually the defendant was not able to obtain finance, could not remedy the default after it was served with notice by the plaintiff and the contract was terminated.
5 Rasile says that he is concerned that Choy may have received a secret commission from the plaintiff in relation to the purchase of the property by the defendant. In his first affidavit, he lays particular emphasis on the meeting which took place between Abrusci and Choy immediately prior to the meeting between Choy, Abrusci and Rasile where the offer and acceptance was signed. Although Rasile has no knowledge of what occurred at that meeting, he says that it was directly contrary to the instructions issued by the defendant to Choy and is highly suspicious. The defendant says it wants the opportunity to explore further and ascertain whether or not there was in fact some arrangement between the plaintiff and Choy which could amount to a secret commission. The plaintiff, for its part, denies that there was any secret commission and says that there was nothing sinister about the meeting between Choy and Abrusci. Furthermore, the plaintiff says that there is not a scintilla of evidence produced by the defendant which could give rise to any arguable defence. Counsel for the plaintiff conceded - and in my view correctly conceded - that if a secret commission was paid by the plaintiff to Choy, then the defendant may have a defence and a grant of summary judgment would not be appropriate. But counsel submitted, in the strongest terms, that there was nothing that could give rise to even a suspicion that a secret commission had been paid.
(Page 5)
6 If this was the end of the matter I would have been inclined to grant summary judgment. But there are two other matters of concern. The first relates to the way in which the plaintiff went about selling the property. In his affidavit of 22 November 2001, Abrusci says that the plaintiff acquired the property in or about August 1998. By June or July 2000 the plaintiff had decided that the property was surplus to its requirements. It commissioned Colliers Jardine (WA) Pty Ltd to prepare a market appraisal on the property. That they did - see annexure "JGA1". Colliers Jardine recommended an asking price for the property of $4.95 million. Abrusci says that Jeff Braddock, a representative of Colliers Jardine, told him that Colliers Jardine "considered that (the plaintiff) could obtain the asking price for (the property)": See par 11. It is difficult to see why, if the plaintiff wished to sell the property, it did not engage Colliers Jardine, a highly reputable firm of real estate agents, to undertake the sale. No explanation for the decision not to engage Colliers Jardine is provided in the plaintiff's affidavit material.
7 Not only that, on 21 July 2000 the plaintiff and Choy entered into what is described as a "marketing agreement" with respect to the property. This agreement appears as annexure "GR28" to the affidavit of Rasile sworn 23 November 2001. Essentially the marketing agreement commits the plaintiff to pay to Choy (or his company) a fee of $300,000 if the property was sold for $4 million and if the property was sold for more than $4 million, to pay to Choy half of any amount in excess of the $4 million. It is very difficult to understand why the plaintiff would have entered into such an arrangement with Choy.
8 A number of things ought be said about these matters to put them in perspective and so as not to unfairly state the plaintiff's position. Choy told Rasile of the existence of the marketing agreement and, at the time the purchase of the property was negotiated by Rasile on behalf of the defendant, he was fully aware of its terms. Given that the purchase price of the property was $3,700,000, Choy made nothing out of the sale pursuant to the marketing agreement. Moreover, as counsel for the plaintiff correctly pointed out, the plaintiff was free to sell the property for any amount and in any way that it saw fit. He submitted that no adverse inference should be drawn from the fact that the plaintiff had not engaged Colliers Jardine to sell the property. Counsel submitted that no explanation for that decision had been provided because none was required.
9 In all the circumstances of this case I am satisfied that it is proper to allow the defendant the opportunity to explore in more detail the
(Page 6)
- relationship between the plaintiff and Choy. I would accept that at present the defendant relies upon little more than suspicion but I am satisfied that the suspicion is not without foundation. The defendant should be granted unconditional leave to defend. Accordingly I would dismiss the plaintiff's chamber summons and order that costs of the application, including reserved costs, be costs in the cause.
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