McGlone v Suncorp-Metway Ltd

Case [2015] QSC 352

SUPREME COURT OF QUEENSLAND

CITATION:

McGlone v Suncorp-Metway Ltd [2015] QSC 352

PARTIES:

JOHN ANDREW MCGLONE

(plaintiff)

v
SUNCORP-METWAY LTD
ABN 66 010 831 722

(defendant)

FILE NO:

SC No 7824 of 2015

DIVISION:

Trial Division

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

15 December 2015

DELIVERED AT:

Brisbane

HEARING DATE:

3 December 2015

JUDGE:

Flanagan J

ORDERS:

1.      Paragraphs [1] and [3] of the amended claim filed 27 February 2015 seeking damages for unconscionable conduct and exemplary damages be permanently stayed.

2.      The amended statement of claim filed 27 February 2015 be struck out. 

3.      Order 7 of the order of Justice Mullins made 5 February 2015 be vacated.

4.      In relation to the proceedings, including the defendant’s application filed 19 November 2015, there be no order as to costs.

CATCHWORDS:

PROCEDURE – SUPREME COURT PROCEDURE – QUEENSLAND – PROCEDURE UNDER UNIFORM CIVIL PROCEDURE RULES AND PREDECESSORS – STAYING PROCEEDINGS – where the defendant provided a line of credit to a company for the purchase of a business, to be operated by the plaintiff’s then wife, that was guaranteed and indemnified by the plaintiff and secured by an existing mortgage over the then marital home – where the plaintiff alleges that he signed the guarantee as a consequence of his then wife’s undue influence and that the defendant engaged in unconscionable conduct by providing the line of credit and subsequently increasing it – where the plaintiff’s marriage broke down and was the subject of proceedings in the Federal Magistrates Court and then an appeal to the Full Court of the Family Court – where the defendant seeks the claim be set aside as an abuse of process as it is an attempt to re-litigate an issue determined by the Federal Magistrates Court and creates the prospect of a result inconsistent with the Federal Magistrates Court – whether the claim should be stayed as an abuse of process or the pleading struck out as disclosing no reasonable cause of action and having a tendency to prejudice or delay the fair trial of the proceeding

PROCEDURE – SUPREME COURT PROCEDURE – QUEENSLAND – PROCEDURE UNDER UNIFORM CIVIL PROCEDURE RULES AND PREDECESSORS – OTHER MATTERS – where the defendant provided a line of credit to a company for the purchase of a business, to be operated by the plaintiff’s then wife, that was guaranteed and indemnified by the plaintiff and secured by an existing mortgage over the then marital home – where the plaintiff alleges that he signed the guarantee as a consequence of his then wife’s undue influence and that the defendant engaged in unconscionable conduct by providing the line of credit and subsequently increasing it – where the plaintiff’s marriage broke down and was the subject of proceedings in the Federal Magistrates Court and then an appeal to the Full Court of the Family Court – where the defendant seeks the claim be set aside as an abuse of process as it is an attempt to re-litigate…

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AGLC
McGlone v Suncorp-Metway Ltd [2015] QSC 352
Case
[2015] QSC 352
Decision Date

CaseChat Overview and Summary

The case of McGlone v Suncorp-Metway Ltd involves a dispute between the plaintiff, Mr. McGlone, and the defendant, Suncorp-Metway Ltd, over a line of credit provided by the defendant to a company, Homegate Pty Ltd, which was to be used by the plaintiff's then wife for the purchase of a business. The plaintiff signed a guarantee and indemnity for the obligations of Homegate under the line of credit, which was secured by a mortgage over the marital home. The plaintiff alleges that he was induced to sign the guarantee under undue influence from his then wife and that the defendant engaged in unconscionable conduct by providing the line of credit and subsequently increasing it. The defendant has applied for summary relief, seeking to set aside the plaintiff's amended claim and statement of claim as an abuse of process and to strike out the pleading as disclosing no reasonable cause of action and having a tendency to prejudice or delay the fair trial of the proceeding.

The legal issues in this case revolve around whether the plaintiff's claims should be stayed as an abuse of process or struck out as disclosing no reasonable cause of action. The defendant argues that the plaintiff's claims are an attempt to re-litigate issues that have already been determined by the Federal Magistrates Court and the Full Court of the Family Court in relation to the breakdown of the plaintiff's marriage. The defendant further argues that the plaintiff's claims are an abuse of process and create the prospect of a result inconsistent with the Federal Magistrates Court's decision. The court must consider whether the plaintiff's claims are an abuse of process and whether they disclose a reasonable cause of action.

The court found that the plaintiff's claims should be stayed as an abuse of process and struck out. The court held that the plaintiff's claims were an attempt to re-litigate issues that have already been determined by the Federal Magistrates Court and the Full Court of the Family Court. The court found that the plaintiff's claims were an abuse of process and created the prospect of a result inconsistent with the Federal Magistrates Court's decision. The court held that the plaintiff's claims disclosed no reasonable cause of action and had a tendency to prejudice or delay the fair trial of the proceeding. The court made orders staying paragraphs [1] and [3] of the amended claim filed 27 February 2015 seeking damages for unconscionable conduct and exemplary damages, striking out the amended statement of claim filed 27 February 2015, vacating Order 7 of the order of Justice Mullins made 5 February 2015, and making no order as to costs.

Orders

Orders of the court

1. Paragraphs [1] and [3] of the amended claim filed 27 February 2015 seeking damages for unconscionable conduct and exemplary damages be permanently stayed.

2. The amended statement of claim filed 27 February 2015 be struck out.

3. Order 7 of the order of Justice Mullins made 5 February 2015 be vacated.

4. In relation to the proceedings, including the defendant’s application filed 19 November 2015, there be no order as to costs.

Background

Background to the litigation

The defendant, Suncorp-Metway Ltd, seeks summary relief in respect of the plaintiff’s amended claim and amended statement of claim. The primary relief sought is that the amended claim be set aside pursuant to r 16 of the Uniform Civil Procedure Rules 1999 (Qld) as an abuse of process.Background On or about 21 August 2008 the defendant entered into an agreement with Homegate Pty Ltd (“Homegate”) for a small business line of credit in the sum of $100,000. These funds were used to purchase a café/homewares retail business in Mooloolaba Queensland to be conducted by the plaintiff’s then wife. On 22 August 2008 the plaintiff signed a deed of guarantee and indemnity with the defendant guaranteeing the obligations of Homegate under the line of credit. As part of the guarantee the plaintiff allowed an existing mortgage over the marital home at Castaways Beach to be taken as security to support the line of credit. In his amended statement of claim the plaintiff pleads that he signed the guarantee not of his own freewill but because of undue influence from his wife. He also pleads that the defendant engaged in unconscionable conduct in providing the line of credit and subsequently increasing it from $100,000 to $150,000. The plaintiff further alleges that in exercising its power of sale in respect of the marital home the defendant breached s 85 of the Property Law Act 1974 (Qld). From an examination of the amended claim and the amended statement of claim the plaintiff does not appear to claim any relief in respect of the undue influence allegations. These allegations were not pleaded in the plaintiff’s original statement of claim. The claims in relation to damages for unconscionable conduct and damages for alleged breaches of s 85 of the Property Law Act were previously pleaded in the plaintiff’s original statement of claim. By orders made 5 February 2015, Mullins J struck out the original statement of claim and granted the plaintiff leave to re-plead. Pursuant to this grant of leave the plaintiff has sought to add allegations of undue influence and to re-plead, with some immaterial changes, the same claims in respect of unconscionable conduct and breaches of s 85 of the Property Law Act. Abuse of process By this application the defendant seeks to shut the plaintiff out from continuing his proceeding. The defendant carries the onus of satisfying the Court that there is an abuse of process. This onus has been described as “a heavy one”.[1] In Spencer v Commonwealth the High Court stated:[2]“The exercise of powers to summarily terminate proceedings must always be attended with caution. That is so where such disposition is sought on the basis that the pleadings fail to disclose a reasonable course of action or on the basis that the action is frivolous or vexatious or an abuse of process.” (citations omitted)[1] Williams v Spautz (1992) 174 CLR 509, 529 (Mason CJ, Dawson, Toohey and McHugh JJ); O’Shane v Harbour Radio Pty Ltd (2013) 85 NSWLR 698, 724 [111].[2] Spencer v Commonwealth of Australia (2010) 241 CLR 118, 131 [24] (French CJ and Gummow J).

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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