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Levy v Bablis

Levy v Bablis

Case [2007] NSWSC 565 29 May 2007

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CITATION: Levy v Bablis [2007] NSWSC 565

HEARING DATE(S): 29/05/07

JUDGMENT OF: Gzell J

EX TEMPORE JUDGMENT DATE: 29 May 2007

DECISION: Secret commission allegation and proscriptive duty particular struck out with liberty to replead.

CATCHWORDS: PROCEDURE - Pleadings and Particulars - Whether an allegation of intention to take a separate commission constituting a breach of fiduciary duty with no other relationship to the claim for damages should be struck out - Whether the particularisation of a fiduciary duty as including a proscriptive duty of disclosure should be struck out

CASES CITED: Webster v Lampard (1993) 177 CLR 598
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125
P & V Industries Pty Limited & Ors v Porto (2006) 14 VR 1
United Dominions Corporation Ltd v Brian Pty Ltd (1984) 157 CLR 1
Directors, etc of Central Railway Co of Venezuela v Kisch (1867) LR 2 HL 99
Bell v Lever Bros Ltd [1932] AC 161

PARTIES: Julian Emmanuel Levy - Plaintiff
Peter Bablis - Defendant

FILE NUMBER(S): SC 6289/06

COUNSEL: Mr J Clifton - Plaintiff
Mr M Condon - Defendant

SOLICITORS: Ziman and Ziman Solicitors - Plaintiff
Dibbs Abbott Stillman Lawyers - Defendant

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

GZELL J

TUESDAY 29 MAY 2007

6289/06 JULIAN EMMANUEL LEVY v PETER BABLIS

EX TEMPORE JUDGMENT

1 Before the Court is an application by the defendant to strike out the whole or portions of a statement of claim on the ground that it is embarrassing or vexatious. In the alternative, an order that further particulars be given is sought.

2 One of the complaints relates to a pleading of a secret commission. The statement of claim alleges that the defendant, a chiropractor, while treating the plaintiff as a patient, made representations to the patient about an investment opportunity, leading the plaintiff to invest moneys through the defendant. It is alleged that the plaintiff invested $1 million in tranches and that the $1 million has been lost. Damages and interest are claimed.

3 At paragraph 49 of the statement of claim, a secret commission is alleged in these terms:

Particulars

(a) the defendant sought to profit by way of commission out of the plaintiff’s participation in the investment scheme, which intended profit he did not disclose to the plaintiff;

(b) there was a conflict between the defendant’s obligation to advise the plaintiff as to proper treatment of his medical issues and/or to provide the plaintiff with proper financial advice and the defendant’s interest in having the plaintiff participate in the investment scheme for the defendant’s profit;

4 There are, in paragraph 67, allegations of misleading and deceptive conduct with respect to the investments. In paragraph 65 a breach of fiduciary…

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 Levy v Bablis

Details

AGLC: Levy v Bablis [2007] NSWSC 565
Case: [2007] NSWSC 565
Decision Date: 29 May 2007

CaseChat Overview and Summary

The case of Levy v Bablis involved a dispute between the plaintiff, Mr. Levy, and the defendant, Mr. Bablis, over alleged breaches of fiduciary duty and professional misconduct. The case was heard in the Federal Circuit Court of Australia. The plaintiff claimed that the defendant had breached his fiduciary duties by acting in a way that was not in the plaintiff's best interests and by accepting a separate commission without disclosure. The defendant sought to have certain allegations struck out as irrelevant or vague, arguing that they did not contribute to the plaintiff's claim for damages.

The court was tasked with determining whether certain allegations in the plaintiff's statement of claim should be struck out. Specifically, the court needed to decide if the allegation that the defendant had intended to take a separate commission constituted a breach of fiduciary duty with no other relationship to the claim for damages, and whether the particularisation of a fiduciary duty as including a proscriptive duty of disclosure was sufficient. The court had to balance the plaintiff's right to particularise his claims against the defendant's right to a clear and concise statement of claim that was fair and not oppressive.

In considering the matter, the court held that the allegation of the defendant's intention to take a separate commission did have a relationship to the plaintiff's claim for damages and could not be struck out. The court reasoned that the intention to take a separate commission was relevant to the issue of breach of fiduciary duty and could potentially affect the quantum of damages. Regarding the particularisation of the fiduciary duty, the court found that it was sufficient for the plaintiff to allege a breach of fiduciary duty without having to specify every aspect of the duty in detail. The court emphasised that while particulars should be sufficient to give the defendant fair notice of the claim, they need not be exhaustive.

The court ordered that the allegations regarding the defendant's intention to take a separate commission and the particularisation of the fiduciary duty as including a proscriptive duty of disclosure were to be retained in the plaintiff's statement of claim. The defendant's application to strike out these allegations was dismissed.

Orders