Leach v Ross - [2013] QSC 333

SUPREME COURT OF QUEENSLAND

CITATION:

Leach v Ross & Anor [2013] QSC 333

PARTIES:

CRAIG JOHN LEACH
(plaintiff)
v
PAUL MARK ROSS
(first defendant)
and
BABES IN PARADISE PTY LTD (ACN 118 024 052)
AS TRUSTEE OF THE BABES IN PARADISE TRUST
(second defendant)

FILE NO/S:

BS 5201 of 2010

DIVISION:

Trial

PROCEEDING:

Trial

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

10 December 2013

DELIVERED AT:

Brisbane

HEARING DATE:

31 July and 1, 2 and 7 August 2013

JUDGE:

Dalton J

ORDER:

Judgment for the plaintiff

CATCHWORDS:

CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – where the plaintiff wanted to open a brothel – where the Prostitution Licensing Authority (PLA) would not grant him a licence to run a brothel – whether the plaintiff and defendant owned the brothel business in equal shares

EQUITY – GENERAL PRINCIPLES – FIDUCIARY OBLIGATIONS – FIDUCIARY DUTY – where the plaintiff alleged that he and the defendant were prospective partners to run a brothel – where the defendant gave an undertaking to the PLA that the plaintiff would not play any part in the operation or management of the brothel – where no partnership between the plaintiff and defendant ever came into being – where entering into partnership depended on a contingency beyond agreement of the parties, being the granting of a licence by the PLA to the plaintiff– whether the defendant owed the plaintiff a fiduciary duty – whether the plaintiff breached such a duty by giving the undertaking to the PLA – whether the plaintiff is entitled to an account

Bell v Lever Bros. Ltd [1932] AC 161, 227
Chan v Zacharia (1983-1984) 154 CLR 178
Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41
Jones v Dunkel
Mackay v Dick (1881) 6 App Cas 251
M Young Legal Associates Ltd v Zahid [2006] 1 WLR 2562
News Limited and Ors v Australian Rugby Football League Ltd & Ors [1996] FCA 870
The Commercial Bank of Australia Ltd v G H Dean & Co Pty Ltd [1983] 2 Qd R 204
United Dominions Corporation Ltd v Brian Pty Ltd (1984‑1985) 157 CLR 1

COUNSEL:

P J Roney QC with B McGlade for the plaintiff
M R Bland for the defendants

SOLICITORS:

Lillas & Loel for the plaintiff
QBM Lawyers for the defendants

The plaintiff left the Federal Police force in 1997, involuntarily, because he had lost the confidence of the Commissioner. He began working as a builder in Sydney with his father as a partner but ran into dispute with his father, which later ended up in the Courts. After that relationship breakdown, he moved to the Gold Coast in 1999 and decided to open a brothel, having read in the newspapers that this was to become legal. He found premises he considered suitable and applied for a development application. This was refused. He challenged that decision in the Planning and Environment Court and lost. He found another premises – Upton Street – the premises the subject of this…

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 Leach v Ross

Details

AGLC: Leach v Ross & Anor [2013] QSC 333
Case: [2013] QSC 333
Decision Date: 10 December 2013

CaseChat Overview and Summary

In the matter of Leach v Ross, the plaintiff sought to establish a brothel but was unable to obtain a licence from the Prostitution Licensing Authority (PLA). The dispute centred on the ownership and management of the brothel business, with the plaintiff alleging an equal ownership arrangement with the defendant. The court was tasked with determining the existence of any partnership, the extent of fiduciary duties owed by the parties, and whether the plaintiff breached any such duties by giving an undertaking to the PLA that he would not be involved in the operation or management of the brothel.

The primary legal issue was whether a partnership existed between the plaintiff and the defendant, given that the formation of the partnership hinged on a contingency—the granting of a licence by the PLA to the plaintiff. The court had to examine if the defendant owed a fiduciary duty to the plaintiff and if the plaintiff breached any such duty by providing the undertaking to the PLA. Additionally, the court considered whether the plaintiff was entitled to an account due to any breach of fiduciary obligations.

The court found that, although there was no formal partnership, the parties intended to share the brothel business equally. The court held that the defendant did not owe a fiduciary duty to the plaintiff because no partnership existed. However, the plaintiff breached a duty of good faith by providing the undertaking to the PLA. The court found that the plaintiff's actions were reasonable given the circumstances and did not warrant an account. The court ultimately ruled in favour of the plaintiff.

The court's final order was a judgment in favour of the plaintiff.

Orders

Orders of the court

Judgment for the plaintiff

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Leach v Ross & Anor [2013] QSC 333
PARTIES:	CRAIG JOHN LEACH (plaintiff) v PAUL MARK ROSS (first defendant) and BABES IN PARADISE PTY LTD (ACN 118 024 052) AS TRUSTEE OF THE BABES IN PARADISE TRUST (second defendant)
FILE NO/S:	BS 5201 of 2010
DIVISION:	Trial
PROCEEDING:	Trial
ORIGINATING COURT:	Supreme Court at Brisbane
DELIVERED ON:	10 December 2013
DELIVERED AT:	Brisbane
HEARING DATE:	31 July and 1, 2 and 7 August 2013
JUDGE:	Dalton J
ORDER:	Judgment for the plaintiff
CATCHWORDS:	CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – where the plaintiff wanted to open a brothel – where the Prostitution Licensing Authority (PLA) would not grant him a licence to run a brothel – whether the plaintiff and defendant owned the brothel business in equal shares EQUITY – GENERAL PRINCIPLES – FIDUCIARY OBLIGATIONS – FIDUCIARY DUTY – where the plaintiff alleged that he and the defendant were prospective partners to run a brothel – where the defendant gave an undertaking to the PLA that the plaintiff would not play any part in the operation or management of the brothel – where no partnership between the plaintiff and defendant ever came into being – where entering into partnership depended on a contingency beyond agreement of the parties, being the granting of a licence by the PLA to the plaintiff– whether the defendant owed the plaintiff a fiduciary duty – whether the plaintiff breached such a duty by giving the undertaking to the PLA – whether the plaintiff is entitled to an account Bell v Lever Bros. Ltd [1932] AC 161, 227 Chan v Zacharia (1983-1984) 154 CLR 178 Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41 Jones v Dunkel Mackay v Dick (1881) 6 App Cas 251 M Young Legal Associates Ltd v Zahid [2006] 1 WLR 2562 News Limited and Ors v Australian Rugby Football League Ltd & Ors [1996] FCA 870 The Commercial Bank of Australia Ltd v G H Dean & Co Pty Ltd [1983] 2 Qd R 204 United Dominions Corporation Ltd v Brian Pty Ltd (1984‑1985) 157 CLR 1
COUNSEL:	P J Roney QC with B McGlade for the plaintiff M R Bland for the defendants
SOLICITORS:	Lillas & Loel for the plaintiff QBM Lawyers for the defendants