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Matheson Engineers Pty Ltd v EL Raghy

Matheson Engineers Pty Ltd v EL Raghy

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Case Copied 28 August 1992 10 min read

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Re: MATHESON ENGINEERS PTY LTD and EXEARNE PTY LTD
And: SAMI EL RAGHY; MICHAEL JOHN BRENZ KRIEWALDT and KEVIN BOND
Nos. WA G83 and 84 of 1992
FED No. 619
Practice and Procedure - Trade Practices
(1992) 37 FCR 6

COURT

IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
French J.(1)

CATCHWORDS

Practice and Procedure - pleading - statement of claim - misleading or deceptive conduct - negligence - knowing concern in contravention - failure to plead conduct said to constitute knowing concern - failure to plead basis for implied representations - failure to identify representations in respect of which s.51A invoked - failure to identify content of duty of care.

Trade Practices - misleading or deceptive conduct - contraventions of s.52 - whether must relate to persons in their capacity as consumers of services - accessorial liability - whether necessary to join primary contravenor in proceedings.

Trade Practices Act 1974 s.51A, s.52

Bevanere Pty Ltd v. Lubidineuse (1985) 7 FCR 325

Concrete Constructions (NSW) Pty Limited v. Nelson (1990) 169 CLR 594

Hornsby Building Information Centre Pty Ltd v. Sydney Building Information Centre Ltd (1978) 140 CLR 216

HEARING

PERTH

#DATE 28:8:1992

Counsel for the Applicants: Mr G. Taylor

Solicitors for the Applicants: Taylor Smart

Mr Sami El Raghy appeared in person.

Mr M.J.B. Kriewaldt appeared in person.

Counsel for Mr K. Bond: Mr S. Archer

Solicitors for Mr K. Bond: Clayton Utz

ORDER

THE COURT ORDERS THAT:

In WAG 83 of 1992

1. The statement of claim be struck out with leave to file a substituted statement of claim.

In WAG 84 of 1992

1. The statement of claim be struck out with leave to file a substituted statement of claim.

2. The applicants pay the second respondent's costs of the second respondent's motion filed 31 July 1992.

Note: Settlement and entry of Orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

In actions number WAG 83 and 84 of 1992 Matheson Engineers Pty Ltd and Exearne Pty Ltd claim damages against three former directors of a gold mining and mineral exploration company called Eon Metals NL. The causes of action relied upon are the negligence and alleged involvement of the directors in misleading or deceptive conduct on the part of Eon. The conduct complained of involves representations made by Eon in July 1989 which are said to have induced Matheson Engineers and Exearne to continue works that were undertaken for Eon in relation to the construction of a gold treatment plant at Wiluna in Western Australia. The directors now move to strike out the statements of claim. Mr Bond, who is the second named respondent in WAG 84 of 1992, was the only one of the directors to have legal representation and the principal submission in relation to the strike out motions were made on his behalf by his counsel, Mr Archer. The submissions were applicable in large measure to both statements of claim. They were adopted by the…

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: [1992] FCA 619
Decision Date: 28 AUGUST 1992

CaseChat Overview and Summary

Matheson Engineers Pty Ltd and EL Raghy appeared before the court in relation to two proceedings, WAG 83 of 1992 and WAG 84 of 1992. The plaintiffs, Matheson Engineers, sought damages for misleading and deceptive conduct and negligence, alleging that the defendant, EL Raghy, knowingly participated in a contravention. Matheson Engineers contended that EL Raghy failed to adequately plead the conduct which allegedly constituted the knowing concern, the basis for the implied representations, the representations in respect of which section 51A was invoked, and the content of the duty of care.

The court was required to determine whether the plaintiffs' statements of claim contained sufficient particulars to provide the defendants with a reasonable opportunity to respond to the claims. The court examined the adequacy of the pleadings, particularly focusing on the specificity of the allegations related to misleading and deceptive conduct and negligence.

The court found that the plaintiffs' statements of claim were deficient in several respects. The pleadings failed to provide sufficient detail about the conduct alleged to constitute the knowing concern in contravention, the basis for the implied representations, the specific representations in respect of which section 51A was invoked, and the content of the duty of care. The court concluded that the statements of claim did not meet the requirements of r 18 of the Federal Court Rules, as they did not provide enough particulars to enable the defendants to respond effectively. Consequently, the court struck out the statements of claim with leave to file substituted statements of claim.

The court ordered that the statements of claim be struck out with leave to file a substituted statement of claim in both proceedings. Additionally, the applicants were ordered to pay the second respondent's costs of the second respondent's motion filed on 31 July 1992. The settlement and entry of orders were to be dealt with in accordance with Order 36 of the Federal Court Rules.

Orders

Orders of the court

THE COURT ORDERS THAT:

In WAG 83 of 1992

1. The statement of claim be struck out with leave to file a substituted statement of claim.

In WAG 84 of 1992

1. The statement of claim be struck out with leave to file a substituted statement of claim.

2. The applicants pay the second respondent's costs of the second respondent's motion filed 31 July 1992.

Note: Settlement and entry of Orders is dealt with in Order 36 of the Federal Court Rules.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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