Lee v Westpac Banking Corporation - [2015] FCA 467

FEDERAL COURT OF AUSTRALIA
Lee v Westpac Banking Corporation [2015] FCA 467

Citation: Lee v Westpac Banking Corporation [2015] FCA 467

Parties: JOHN CHARLES LEE and GLENDA MARIAN LEE v WESTPAC BANKING CORPORATION (ABN 33 007 457 141)

File number: QUD 211 of 2013

Judge: DOWSETT J

Date of judgment: 15 May 2015

Catchwords: PRACTICE AND PROCEDURE – interlocutory application for leave to file an amended statement of claim – requirements of pleadings as to condition of mind in r 16.43 of the Federal Court Rules 2011 – what a party pleading the imputed knowledge of a company must identify in its pleadings – whether proposed pleading is deficient – whether leave should be granted

Legislation: Australian Securities and Investments Commission Act 2001 (Cth)
Federal Court of Australia Act 1976 (Cth)
Federal Court Rules 2011 (Cth)
Trade Practices Act 1974 (Cth)

Cases cited: Australia Competition and Consumer Commission v April International Marketing Services Australia Pty Ltd [2007] ATPR ¶42-210
Australian Competition and Consumer Commission v Radio Rentals Ltd (2005) 146 FCR 292
Krakowski v Eurolynx Properties Ltd (1995) 183 CLR 563
Leinenga v Logan City Council [2006] QSC 294
Three Rivers District Council v Bank of England (No 3) [2001] 2 All ER 513

Date of hearing: 15 August 2014

Date of last submissions: 9 September 2014

Place: Brisbane

Division: GENERAL DIVISION

Category: Catchwords

Number of paragraphs: 62

Counsel for the Applicants: Ms J Lucy

Solicitor for the Applicants: Levitt Robinson

Counsel for the Respondent: Mr G Gibson QC with Mr G Beacham

Solicitor for the Respondent: King & Wood Mallesons

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY

GENERAL DIVISION

QUD 211 of 2013

BETWEEN:
JOHN CHARLES LEE
First Applicant

GLENDA MARIAN LEE
Second Applicant

AND:
WESTPAC BANKING CORPORATION (ABN 33 007 457 141)
Respondent

JUDGE:

DOWSETT J

DATE:

15 MAY 2015

PLACE:

BRISBANE

REASONS FOR JUDGMENT
THE GROUP

The applicants, as representative parties, bring these proceedings against the respondent (“Westpac”). The group members are former clients of Storm Financial Ltd (“Storm”) who:
(a)borrowed money from [Westpac] in the period between on or after 22 October 2004 and 31 October 2008 (the “Relevant Period”), or who increased their borrowings from Westpac during the Relevant Period, to invest in one or more of the Special Funds (as defined in paragraph 6 below); and
(b) suffered loss and damage as a result of:
(i)Storm’s breaches of contract as alleged in paragraphs 74 to 76 and 79 below; and, or alternatively
(ii)Storm’s misrepresentations pleaded in paragraphs 81 to 84 and 93 below; and
(c) have not settled with Westpac the claims the subject of these proceedings.
THE PROCEEDINGS
I am presently considering an application for leave to file a second amended statement of claim. The applicants’ claims arise out of dealings between them and Storm, and associated dealings between them and Westpac. Storm is presently in liquidation. It previously carried on a business which allegedly included the provision of financial advice. It also operated a number of investment funds (the “special…

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: [2015] FCA 467
Decision Date: 15 May 2015

CaseChat Overview and Summary

The case of Lee v Westpac Banking Corporation involved an application by the plaintiff, Lee, for leave to file an amended statement of claim against the defendant, Westpac Banking Corporation. The dispute centred on whether the plaintiff was granted leave to amend his statement of claim to include allegations regarding the imputed knowledge of the defendant. The matter was heard in the Federal Court of Australia.

The primary legal issue before the court was whether the plaintiff's proposed amended statement of claim sufficiently identified the condition of mind of the defendant's employees, as required by rule 16.43 of the Federal Court Rules 2011. The court had to determine if the plaintiff had correctly pleaded the imputed knowledge of the company and whether the proposed pleading was deficient. The court also needed to decide whether leave should be granted for the plaintiff to amend his statement of claim.

The court found that the plaintiff's proposed amended statement of claim did not sufficiently identify the condition of mind of the defendant's employees, as required by rule 16.43. The court held that the plaintiff had not identified what each relevant employee knew or ought to have known, which was necessary to properly plead the imputed knowledge of the company. The court concluded that the proposed pleading was deficient and denied the plaintiff's application for leave to file an amended statement of claim. The court reasoned that the plaintiff's proposed pleading failed to meet the requirements of the rules and did not provide sufficient detail to allow the defendant to respond effectively.

The court dismissed the plaintiff's application for leave to file an amended statement of claim. The plaintiff was not granted permission to amend his statement of claim to include the allegations regarding the imputed knowledge of the defendant. The court's decision was based on the finding that the plaintiff's proposed pleading was deficient in not identifying the condition of mind of the defendant's employees as required by rule 16.43 of the Federal Court Rules 2011.

Orders