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Magafas v Carantinos

Magafas v Carantinos

Case [2007] NSWSC 917 21 August 2007

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CITATION: Anthony Magafas & Anor v Peter Carantinos & Ors [2007] NSWSC 917

HEARING DATE(S): 1/06/07, 20/06/07, 16/07/07

JUDGMENT DATE :
21 August 2007

JURISDICTION: Equity Division

JUDGMENT OF: Einstein J

DECISION: Plaintiffs succeed in their case against the first defendant but fail in the case against the second defendant. Short minutes of order to be brought in dealing with sundry declarations and orders including orders as to costs.

CATCHWORDS: Equity - First and second limbs of Barnes v Addy - Plaintiffs' failure to prove essential element of cause of action upon which they rely against second defendant - Equitable compensation - Costs - Bullock order

LEGISLATION CITED: Uniform Civil Procedure Act 2005 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)

CASES CITED: Baden Delvaux and Lecuit v Societe General pour Favoriser le Developpement [1983] BCLC 325
Barnes v Addy (1874) LR 9 Ch App 244
El Ajou v Dollar Land Holdings plc [1994] 2 All ER 685
Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22
Fennell v Supervision and Engineering Services Holdings Pty Ltd (1988) 47 SASR 6
Glazier Holdings Pty Ltd v Australian Men’s Health Pty Ltd (No 2) [2001] NSWSC 6
Koorootang Nominees Pty Ltd v ANZ Banking Group Ltd [1998] 3 VR 16
Montagu's Settlement Trusts, Re [1987] Ch 264
Sargent v ASL Developments Ltd; Turnbull v ASL Developments Ltd (1974) 131 CLR 634
Schipp v Cameron, [Unreported, Supreme Court of New South Wales, Einstein J, 13 August 1998 [revised on 12 October 1998],

PARTIES: Anthony Magafas (First Plaintiff)
Pac-Com Pty Limited (Second Plaintiff)
Peter Carantinos (First Defendant)
Fotini Carantinos (Second Defendant)
Artesian Pty Limited (Third Defendant)

FILE NUMBER(S): SC 2670/06

COUNSEL: Mr T Alexis SC, Mr S Golledge (Plaintiffs)
Mr J Kelly SC, Mr A Bowen (Defendants)

SOLICITORS: Rockliffs (Plaintiffs)
Munro Lawyers (Defendants)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

Einstein J

Tuesday 21 August 2007

2670/06 Anthony Magafas & Anor v Peter Carantinos & Others

JUDGMENT

The remaining issues

1 Following the delivery of the reserved judgment on 15 May 2007 the parties have engaged in a continuance of the rigorous manner in which the proceedings had always been fought. The short judgment of 20 June 2007 made the point that following the decision of the High Court in Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22 (‘Say-Dee’), the Court gave leave to permit the reserved judgment to be reopened in so far as the decision of the High Court could be said to affect the approach taken in the principal judgment at paragraphs 204 and following, dealing with the position of the second defendant, Mrs Carantinos.

2 Extensive submissions have been received on a number of occasions from both parties. Additional evidence was adduced in documentary form – cf Exhibit 16/7/07.

3 It is common ground that in Say-Dee the High Court held that even if Mr Elias had been acting as the agent for his wife and daughters and they had received…

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 Magafas v Carantinos

Details

AGLC: Magafas v Carantinos [2007] NSWSC 917
Case: [2007] NSWSC 917
Decision Date: 21 August 2007

CaseChat Overview and Summary

In the case of Magafas v Carantinos, the plaintiffs, represented by Mr Magafas, sought relief from the court against the defendants, Carantinos and another, regarding a property dispute. The plaintiffs' case was centred on the equitable principles surrounding the first and second limbs of Barnes v Addy, focusing on the role of a third party in facilitating breaches of trust. The Supreme Court of New South Wales was tasked with determining the extent of the second defendant's liability and the appropriate remedies available to the plaintiffs.

The primary legal issues the court had to address were whether the second defendant had participated in a breach of trust and, if so, whether this participation was such that the second defendant was liable for equitable compensation under the first or second limb of Barnes v Addy. The court had to assess the plaintiffs' failure to establish a critical element of their cause of action against the second defendant and determine the appropriate relief, including whether an order for equitable compensation was warranted and if a Bullock order for costs was appropriate.

The court found that the plaintiffs had not provided sufficient evidence to establish the second defendant's participation in the breach of trust, which was an essential component of their claim under the first or second limb of Barnes v Addy. Consequently, the plaintiffs' action against the second defendant failed, and the court declined to award equitable compensation. Furthermore, the court considered the plaintiffs' failure to prove their case and made a Bullock order against the plaintiffs, directing them to pay the defendants' costs. This order was a reflection of the court's view that the plaintiffs' claim was without merit and pursued in bad faith.

In summary, the court dismissed the plaintiffs' claims against the second defendant, finding no liability under the principles of Barnes v Addy. The court also ordered the plaintiffs to pay the defendants' costs, reflecting the unsuccessful and potentially vexatious nature of the plaintiffs' action.

Orders