Leighton Contractors Pty Ltd v O'Carrigan - [2016] QSC 223

SUPREME COURT OF QUEENSLAND

CITATION:

Leighton Contractors Pty Ltd v O’Carrigan & Ors [2016] QSC 223

PARTIES:

LEIGHTON CONTRACTORS PTY LTD
ACN 000 893 667

(plaintiff)

v
DAMIAN VICTOR O’CARRIGAN
(first defendant)
JULIE DALE O’CARRIGAN
(second defendant)
JODY DALE O’CARRIGAN
(third defendant)
BELINDA JAYNE LEONARD
(fourth defendant)
BLAKRAYNE PASTORAL PTY LTD
ACN 103 102 656

(fifth defendant)

FILE NO/S:

Brisbane No 969 of 2013

DIVISION:

Trial Division

PROCEEDING:

Civil Trial

ORIGINATING COURT:

Supreme Court of Queensland at Brisbane

DELIVERED ON:

30 September 2016

DELIVERED AT:

Brisbane

HEARING DATE:

13 – 16, 24 June 2016

JUDGE:

Boddice J

ORDER:

I shall hear the parties as to the form of orders and costs.

CATCHWORDS:

EQUITY – TRUSTS AND TRUSTEES – FOLLOWING TRUST PROPERTY – GENERALLY – where the plaintiff is a large corporation primarily involved in the construction industry – where the first defendant was a senior employee of the plaintiff – where the first defendant was convicted of fraudulently obtaining in excess of $20 million from the plaintiff between 2000 and 2012 – where the first defendant’s fraud involved the creation of false invoices to the plaintiff from a business name owned by the first defendant, “Acorn Cottage” – where the invoices sent to the plaintiff were approved for payment by the first defendant in his senior management position and funds were subsequently paid to the accounts controlled by the first defendant – where the plaintiff alleges the funds misappropriated from it by the first defendant through the Acorn Cottage invoices were used to provide funds to the fourth defendant – where the plaintiff seeks recovery of those funds, which it is alleged were used by the fourth defendant to undertake improvements on a property at Mt Pleasant and to purchase plant and equipment, horses and other property – where the fourth defendant admits she received funds from the first defendant – where the question of whether the funds received by the fourth defendant were funds misappropriated from the plaintiff depends upon a tracing exercise – whether the plaintiff has proven the funds received by the fourth defendant from the first defendant were misappropriated funds

CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – FORMATION OF CONTRACTUAL RELATIONS – MATTERS NOT GIVING RISE TO BINDING CONTRACT – where the fourth defendant is an escort who was first engaged by the first defendant to provide sexual services in or about mid-2004 – where the first defendant paid the fourth defendant’s living and other expenses from late 2004 – where the payments only ceased when the first defendant’s fraud was discovered by the plaintiff in 2012 – where the fourth defendant alleges that in or about late 2004 she entered into an agreement with the first defendant whereby she agreed to provide, for reward, sexual services and advice and companionship on a professional basis, exclusively to the first defendant – where the fourth defendant alleges that between late 2004 and October 2012 she provided these services in accordance with the agreement, in exchange for which she…

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: [2016] QSC 223
Decision Date: 30 September 2016

CaseChat Overview and Summary

The case of Leighton Contractors Pty Ltd v O'Carrigan involves a large corporation in the construction industry, Leighton Contractors, which sued a former employee, O'Carrigan, and others, alleging misappropriation of funds. O'Carrigan, a senior employee, was convicted of fraudulently obtaining over $20 million from Leighton Contractors through false invoices sent from a business name he controlled. Leighton Contractors claims these funds were used by another defendant, Ms. Smith, to improve a property at Mt Pleasant and purchase assets. The court was tasked with determining whether the funds received by Ms. Smith were misappropriated, if Ms. Smith was a bona fide purchaser for value without notice, and if indefeasibility of title could be overcome.

The court had to decide if the funds Leighton Contractors sought to recover were indeed misappropriated and if they could be traced to Ms. Smith. It also needed to assess whether Ms. Smith, who was allegedly paid by O'Carrigan for services, could claim to be a bona fide purchaser for value, and if the nature of the services rendered could support the receipt of such funds. Finally, the court had to determine if the doctrine of indefeasibility of title would protect Ms. Smith's ownership of the property purchased with the alleged misappropriated funds.

The court found that Leighton Contractors had successfully traced the misappropriated funds to Ms. Smith, who could not claim to be a bona fide purchaser for value as she was aware of O'Carrigan's fraudulent activities. Consequently, the court held that indefeasibility of title did not bar Leighton Contractors from imposing a personal equity on Ms. Smith's property. This decision allows Leighton Contractors to recover the misappropriated funds used by Ms. Smith to purchase and improve the Mt Pleasant property.

The court will hear the parties regarding the form of orders and costs.

Orders

Orders of the court

I shall hear the parties as to the form of orders and costs.

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:	Leighton Contractors Pty Ltd v O’Carrigan & Ors [2016] QSC 223
PARTIES:	LEIGHTON CONTRACTORS PTY LTD ACN 000 893 667 (plaintiff) v DAMIAN VICTOR O’CARRIGAN (first defendant) JULIE DALE O’CARRIGAN (second defendant) JODY DALE O’CARRIGAN (third defendant) BELINDA JAYNE LEONARD (fourth defendant) BLAKRAYNE PASTORAL PTY LTD ACN 103 102 656 (fifth defendant)
FILE NO/S:	Brisbane No 969 of 2013
DIVISION:	Trial Division
PROCEEDING:	Civil Trial
ORIGINATING COURT:	Supreme Court of Queensland at Brisbane
DELIVERED ON:	30 September 2016
DELIVERED AT:	Brisbane
HEARING DATE:	13 – 16, 24 June 2016
JUDGE:	Boddice J
ORDER:	I shall hear the parties as to the form of orders and costs.
CATCHWORDS:	EQUITY – TRUSTS AND TRUSTEES – FOLLOWING TRUST PROPERTY – GENERALLY – where the plaintiff is a large corporation primarily involved in the construction industry – where the first defendant was a senior employee of the plaintiff – where the first defendant was convicted of fraudulently obtaining in excess of $20 million from the plaintiff between 2000 and 2012 – where the first defendant’s fraud involved the creation of false invoices to the plaintiff from a business name owned by the first defendant, “Acorn Cottage” – where the invoices sent to the plaintiff were approved for payment by the first defendant in his senior management position and funds were subsequently paid to the accounts controlled by the first defendant – where the plaintiff alleges the funds misappropriated from it by the first defendant through the Acorn Cottage invoices were used to provide funds to the fourth defendant – where the plaintiff seeks recovery of those funds, which it is alleged were used by the fourth defendant to undertake improvements on a property at Mt Pleasant and to purchase plant and equipment, horses and other property – where the fourth defendant admits she received funds from the first defendant – where the question of whether the funds received by the fourth defendant were funds misappropriated from the plaintiff depends upon a tracing exercise – whether the plaintiff has proven the funds received by the fourth defendant from the first defendant were misappropriated funds CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – FORMATION OF CONTRACTUAL RELATIONS – MATTERS NOT GIVING RISE TO BINDING CONTRACT – where the fourth defendant is an escort who was first engaged by the first defendant to provide sexual services in or about mid-2004 – where the first defendant paid the fourth defendant’s living and other expenses from late 2004 – where the payments only ceased when the first defendant’s fraud was discovered by the plaintiff in 2012 – where the fourth defendant alleges that in or about late 2004 she entered into an agreement with the first defendant whereby she agreed to provide, for reward, sexual services and advice and companionship on a professional basis, exclusively to the first defendant – where the fourth defendant alleges that between late 2004 and October 2012 she provided these services in accordance with the agreement, in exchange for which she…