Mitchell v Pacific Dawn Pty Ltd - [2003] QSC 86

SUPREME COURT OF QUEENSLAND

CITATION:

Mitchell v Pacific Dawn P/L [2003] QSC 086

PARTIES:

BRUCE JOSEPH MITCHELL
(plaintiff)
v
PACIFIC DAWN PTY LTD ACN 070 358 280
(defendant)

FILE NO/S:

S 3872 of 2001

DIVISION:

Trial Division

PROCEEDING:

Application

DELIVERED ON:

4 April 2003

DELIVERED AT:

Brisbane

HEARING DATE:

19, 20, 21 August, 27 September 2002

JUDGE:

B W Ambrose J

ORDER:

I answer question 3(a) as follows –
The meeting of 22 December 2000 did result in an agreement between the plaintiff and the defendant in the terms alleged in paragraphs 13 to 16 of the defence and in respect of this agreement, consideration (albeit minimal) did pass from the defendant to the plaintiff.The consideration passing from the defendant to the plaintiff was the reduction of the retention fund to 2.5% of the plaintiff’s certified entitlements under the contract (from either 8% or 4%) to be held by or on behalf of the defendant to meet rectification costs. The agreement was legally binding upon the plaintiff subject to his right to repudiate it on the grounds of unconscionable conduct and economic duress exercised upon him by the defendant with the assistance of its architect to persuade him to make that agreement.

I answer question 3(b) as follows –
The compromise agreement of 22 December 2000 was entered into as a consequence of the unconscionable conduct and economic duress brought to bear by the defendant with the assistance of his architect upon the plaintiff and consequently it is unenforceable by the defendant as alleged in para 13 of the reply.

CATCHWORDS:

BUILDING AND CONSTRUCTION CONTRACTS – Recovery of monies – application to determine separately two questions arising on the pleadings – whether building contract varied by further agreement – whether consideration passed from defendant to the plaintiff – whether binding contract formed – whether agreement obtained by defendant through economic duress and unconscionable conduct

Foakes v Beer (1884) 9 AC 605, considered
Musumeci & Anor v Winadell Pty Ltd (1994) 34 NSWLR 723, followed
Stilk v Myrick (1809) 170 ER 1168, considered
Williams v Roffey Bros & Nicholls (Contractors) Ltd [1991] 1 QB 1, considered

COUNSEL:

P J Dunning for the plaintiff
S R Lumb for the defendant

SOLICITORS:

Primrose Couper Cronin Rudkin for the plaintiff
Lethbridge Hogan O’Hanlon for the defendant

AMBROSE J: This is an application to determine separately two questions arising on the pleadings delivered between the parties.

On 1 May 2001 the plaintiff delivered a statement of claim claiming the sum of $341,638.49 due under a building contract between him and the defendant pursuant to which he constructed a multi-storey commercial/residential building at High Street, Toowong.

By defence filed 12 June 2001 the defendant denied indebtedness and pleaded in paras 13, 14, 15 and 16 of the defence that on 22 December 2000 the plaintiff and defendant agreed to compromise their positions by way of settlement whereunder inter alia the plaintiff agreed to accept the sum of approximately $273,000 in final settlement…

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 Mitchell v Pacific Dawn Pty Ltd

Details

AGLC: Mitchell v Pacific Dawn Pty Ltd [2003] QSC 86
Case: [2003] QSC 86
Decision Date: 4 April 2003

CaseChat Overview and Summary

In Mitchell v Pacific Dawn Pty Ltd, the plaintiff, Mitchell, sought to recover monies from the defendant, Pacific Dawn Pty Ltd, in relation to a building contract. The dispute arose from an agreement between the parties concerning the terms of a contract, specifically whether the contract had been varied and whether consideration had passed from the defendant to the plaintiff. The case was heard in the Supreme Court of New South Wales. The court was tasked with determining whether a binding contract was formed between the parties and whether the agreement was obtained through economic duress and unconscionable conduct.

The court considered whether the meeting on 22 December 2000 resulted in an agreement between the parties and if so, whether consideration passed from the defendant to the plaintiff. The court found that an agreement was indeed reached, with consideration taking the form of a reduction in the retention fund. The court also examined whether the agreement was influenced by economic duress and unconscionable conduct, which would render the agreement unenforceable. The court concluded that the agreement was a consequence of such conduct and was therefore unenforceable by the defendant.

In answer to question 3(a), the court found that an agreement was formed at the meeting on 22 December 2000, with the defendant reducing the retention fund to 2.5% of the plaintiff's certified entitlements. This agreement was legally binding but subject to the plaintiff's right to repudiate it on the grounds of unconscionable conduct and economic duress. For question 3(b), the court determined that the compromise agreement was indeed entered into as a consequence of the unconscionable conduct and economic duress exercised by the defendant, and therefore it was unenforceable.

The final orders of the court were that the agreement formed on 22 December 2000 was binding but subject to the plaintiff's right to repudiate it, and that the compromise agreement was unenforceable due to the unconscionable conduct and economic duress exerted by the defendant.

Orders

Orders of the court

I answer question 3(a) as follows –

The meeting of 22 December 2000 did result in an agreement between the plaintiff and the defendant in the terms alleged in paragraphs 13 to 16 of the defence and in respect of this agreement, consideration (albeit minimal) did pass from the defendant to the plaintiff.The consideration passing from the defendant to the plaintiff was the reduction of the retention fund to 2.5% of the plaintiff’s certified entitlements under the contract (from either 8% or 4%) to be held by or on behalf of the defendant to meet rectification costs. The agreement was legally binding upon the plaintiff subject to his right to repudiate it on the grounds of unconscionable conduct and economic duress exercised upon him by the defendant with the assistance of its architect to persuade him to make that agreement.

I answer question 3(b) as follows –

The compromise agreement of 22 December 2000 was entered into as a consequence of the unconscionable conduct and economic duress brought to bear by the defendant with the assistance of his architect upon the plaintiff and consequently it is unenforceable by the defendant as alleged in para 13 of the reply.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Mitchell v Pacific Dawn P/L [2003] QSC 086
PARTIES:	BRUCE JOSEPH MITCHELL (plaintiff) v PACIFIC DAWN PTY LTD ACN 070 358 280 (defendant)
FILE NO/S:	S 3872 of 2001
DIVISION:	Trial Division
PROCEEDING:	Application
DELIVERED ON:	4 April 2003
DELIVERED AT:	Brisbane
HEARING DATE:	19, 20, 21 August, 27 September 2002
JUDGE:	B W Ambrose J
ORDER:	I answer question 3(a) as follows – The meeting of 22 December 2000 did result in an agreement between the plaintiff and the defendant in the terms alleged in paragraphs 13 to 16 of the defence and in respect of this agreement, consideration (albeit minimal) did pass from the defendant to the plaintiff.The consideration passing from the defendant to the plaintiff was the reduction of the retention fund to 2.5% of the plaintiff’s certified entitlements under the contract (from either 8% or 4%) to be held by or on behalf of the defendant to meet rectification costs. The agreement was legally binding upon the plaintiff subject to his right to repudiate it on the grounds of unconscionable conduct and economic duress exercised upon him by the defendant with the assistance of its architect to persuade him to make that agreement. I answer question 3(b) as follows – The compromise agreement of 22 December 2000 was entered into as a consequence of the unconscionable conduct and economic duress brought to bear by the defendant with the assistance of his architect upon the plaintiff and consequently it is unenforceable by the defendant as alleged in para 13 of the reply.
CATCHWORDS:	BUILDING AND CONSTRUCTION CONTRACTS – Recovery of monies – application to determine separately two questions arising on the pleadings – whether building contract varied by further agreement – whether consideration passed from defendant to the plaintiff – whether binding contract formed – whether agreement obtained by defendant through economic duress and unconscionable conduct Foakes v Beer (1884) 9 AC 605, considered Musumeci & Anor v Winadell Pty Ltd (1994) 34 NSWLR 723, followed Stilk v Myrick (1809) 170 ER 1168, considered Williams v Roffey Bros & Nicholls (Contractors) Ltd [1991] 1 QB 1, considered
COUNSEL:	P J Dunning for the plaintiff S R Lumb for the defendant
SOLICITORS:	Primrose Couper Cronin Rudkin for the plaintiff Lethbridge Hogan O’Hanlon for the defendant