Mirzikinian v Tom & Bill Waterhouse Pty Ltd

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NEW SOUTH WALES COURT OF APPEAL

CITATION:
Mirzikinian v Tom & Bill Waterhouse Pty Ltd [2009] NSWCA 296
This decision has been amended. Please see the end of the judgment for a list of the amendments.

FILE NUMBER(S):
40010/09

HEARING DATE(S):
28 August 2009

JUDGMENT DATE:
8 October 2009

PARTIES:
Warwick Mirzikinian (Appellant)
Tom & Bill Waterhouse Pty Ltd (Respondent)

JUDGMENT OF:
Ipp JA Tobias JA McColl JA   

LOWER COURT JURISDICTION:
District Court

LOWER COURT FILE NUMBER(S):
DC 3914/07

LOWER COURT JUDICIAL OFFICER:
Elkaim DCJ

LOWER COURT DATE OF DECISION:
11 November 2008

COUNSEL:
D Pritchard SC; J P Donohoe (Appellant)
R Dubler SC; T Maltz (Respondent)

SOLICITORS:
Pattin Bell Davey Lawyers (Appellant)
JBT Lawyers (Respondent)

CATCHWORDS:
DEED – delivery - whether a document (the Deed) was delivered as a deed – whether the appellant intended to execute the Deed as his deed – circumstances establish the appellant intended to execute the Deed as his deed
DEED – escrow – whether the appellant delivered the Deed in escrow – acknowledgement of indebtedness and undertaking to pay given unconditionally – whether the Deed may be construed to ascertain whether it was delivered, implicitly, in escrow – whether grantee of a deed may sue grantor even though grantee did not execute the deed and the deed contained cross-covenants- whether an agreement means that a deed has been delivered in escrow is to be determined by the express terms of the agreement - circumstances establish the Deed was not delivered in escrow
DEED – escrow - escrow conditions fulfilled – whether the appellant had revoked the Deed by making a counter-offer before the service of the statement of claim – not open to appellant to revoke the Deed – whether the Deed had expired before the conditions were fulfilled- mere lapse of time before execution of the Deed by the respondent did not allow appellant to renounce it
DEED – whether the Deed was illegal – respondent not licensed when performing book keeping services - whether the debts incurred illegally– Deed silent on the identity of bookmaker – nothing in Deed inconsistent with the services having been performed by a person whose claim had been assigned to the respondent

LEGISLATION CITED:
District Court Act 1973, s 127(2)(d)
Supreme Court Act 1970, s 75(10)
Unlawful Gambling Act 1998, s 56

CATEGORY:
Principal judgment

CASES CITED:
Alan Estates Ltd v WG Stores Ltd [1982] Ch 511
Ansett Transport Industries (Operations) Pty Ltd v Comptroller of Stamps (Vic) [1985] VR 70
Beesley v Hallwood Estates Ltd [1961] Ch 105
Bower v Burdekin (1843) 11 M&W 128
Commissioner of Taxation v Taylor (1929) 42 CLR 80
Dakin v Trustees Executors & Agency Co Ltd [1920] VLR 427
Doe d Garnons v Knight (1826) 108 ER 250
Hewlett-Packard v Exeed [2004] FCA 135; (2004 48 ACSR 71
Hooker Industrial Developments Pty Ltd v Trustees of the Christian Bros [1977] 2 NSWLR 109
In re Carile [1920] VLR 427
Kingston v Ambrian Investment Company Ltd [1975] 1 WLR;…

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Details
Case
[2009] NSWCA 296
Decision Date

CaseChat Overview and Summary

The appeal concerned a dispute between Mirzikinian (the appellant) and Tom & Bill Waterhouse Pty Ltd (the respondent) regarding a deed that acknowledged an indebtedness of $250,000. The appellant had placed bets with Mr. Waterhouse, who was a licensed bookmaker, and incurred this debt. The appellant argued that the deed was not validly delivered, was delivered in escrow, or was illegal. The case was heard in the Court of Appeal of the Supreme Court of New South Wales.

The primary legal issues before the court were whether the deed was validly delivered as a deed, whether it was delivered in escrow, and whether the deed was illegal. Specifically, the court had to determine if the appellant intended to execute the deed as his deed, if the acknowledgment of indebtedness and undertaking to pay were unconditional, and if the deed could be construed as having been delivered in escrow. The court also considered whether the respondent, who was not licensed when performing bookkeeping services, rendered the debts incurred illegal, and whether the deed had expired or been revoked by the appellant before its conditions were fulfilled.

The Court of Appeal, comprising Ipp, Tobias, and McColl JJA, dismissed the appeal. The court reasoned that the appellant's argument based on illegality failed, as there was nothing in the deed inconsistent with the services having been performed by a person whose claim had been assigned to the respondent. Furthermore, the court found that the circumstances established the deed was not delivered in escrow and that the appellant's acknowledgment of indebtedness and undertaking to pay were unconditional. The court also held that the appellant could not revoke the deed, and the mere lapse of time before the respondent's execution did not allow the appellant to renounce it.

Leave to appeal was granted, but the appeal was dismissed with costs. The $250,000 paid by the appellant into court as security for the judgment debt was ordered to be paid to the respondent, subject to a 14-day stay. The entitlement to interest on this sum was to be decided in the District Court.

Orders

Orders of the court

1. Leave to appeal granted

2. Appeal dismissed with costs

3. The $250,000 paid by the appellant into Court as security for the judgment debt be paid to the respondent, subject to this order being stayed for 14 days from the date on which this judgment is delivered.

4. Entitlement to interest on $250,000 to be decided in the District Court

Background

Background to the litigation

The appellant accepted, correctly, that it would be open to this Court to refuse leave to appeal or to dismiss the appeal on the grounds that the respondent was entitled to summary judgment based on its argument that the Deed was a deed. Were the Court to uphold the notice of contention, no substantial injustice would result from the judgment appealed from even though, notionally, the judgment might contain an error of principle. Were the Court to come to such a view, it would be empowered by s 75(10) of the Supreme Court Act 1970 to dismiss the appeal. That section provides that on appeal the court may make any order, “which the nature of the case requires”.The circumstances leading to the signing of the Deed and the subsequent relevant facts Over the period 9 September 2006 to 21 October 2006, the appellant placed a number of bets with Mr Waterhouse, in his personal capacity. Mr Waterhouse was a licensed bookmaker. Mr Waterhouse allowed the respondent credit facilities for making those bets. Elkaim DCJ found that, “over a period of time the [appellant], in effect, ran up a bill of $250,000”. The notice of appeal does not challenge these findings. From about October 2006, negotiations ensued between the appellant and representatives of Mr Waterhouse regarding payment of the $250,000. During the course of these negotiations the appellant sought “more time to pay”. Elkaim DCJ observed:“The [appellant] does not dispute that he placed the bets, nor that he ran up the debt. In fact, as I understand the submissions on his behalf, he does not dispute that he owes someone $250,000. He says, however, that he does not owe it to [the respondent]. He certainly has not paid $250,000 to whoever that someone is.”The notice of appeal does not challenge these findings. According to the appellant, on a date prior to 21 March 2007, he had a conversation with Louise to the following effect:“I said:I can’t settle the account immediately, I need some sort of arrangement to be put in place to give me time to pay. I can’t pay immediately, you kept increasing my credit so I could bet with you to recover my losses. I spoke to Tom and he is ok with a delayed payment as long as I pay interest.Louise said:Tom has no authority to agree to anything, Bill is the boss and he said he would not consider any proposal for payment unless it is signed and in writing from you. Anyway I think we could come and see you and organise something. I know you are betting with other people and we would like to settle this so you can bet with us again.” On 21 March 2007, the appellant met with Louise and Robert at a coffee shop in Sydney. The purpose of the meeting was to discuss the repayment of the appellant’s debt. According to the appellant, at that meeting he had a conversation as follows with Louise:“Louise said: As you know I have discussed your situation with Bill and he said he wouldn’t consider any proposal for repayment until he has something in writing, so we have prepared a document for you to sign so we can show him.I said: Ok that sounds fair enough.Robert said: He likes doing things the proper way.”

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

I would therefore hold that the appellant’s argument based on illegality fails.Conclusion I would uphold the application for leave to appeal but dismiss the appeal with costs. The appellant has paid $250,000 into court as security for the judgment debt. Mr Pritchard indicated that, in the event of the appeal failing, he would not oppose an order that the $250,000 be paid out to the respondent, subject to that order being stayed for 14 days. Accordingly I would order further that the $250,000 paid by the appellant into court as security for the judgment debt be paid to the respondent, subject to this order being stayed for 14 days from the date on which this judgment is delivered. No submissions were made about the interest that has accumulated on the $250,000 while it has been deposited with the Court. The entitlement to this interest should form part of the issues that remain to be decided in the District Court. TOBIAS JA: I agree with Ipp JA. McCOLL JA: I agree with Ipp JA.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.