Moray and Agnew v Haggis - [2017] FCCA 129

FEDERAL CIRCUIT COURT OF AUSTRALIA

MORAY & AGNEW v HAGGIS & ANOR

[2017] FCCA 129

Catchwords:
BANKRUPTCY – Creditor’s petitions – unpaid legal fees – grounds of opposition – whether Court should look behind judgments for the unpaid fees considered – petitioning creditor holding security over land owned by one of the respondents – value of the security considered.

Legislation:

Bankruptcy Act 1966 (Cth), ss.44, 52

Federal Circuit Court (Bankruptcy) Rules 2006 (Cth)

Cases cited:

Radich v Bank of New Zealand (1993) 45 FCR 101; (1993) 116 ALR 676
Re Vassis: Ex Parte Leung (1986) 64 ALR 407

Wolff v Donovan (1991) 29 FCR 480 at 486

Xu v Wan Ze Property Development Pty Ltd (2014) 315 ALR 523

Applicant:

MORAY & AGNEW

First Respondent:

ROY HAGGIS

Second Respondent:

MARYANN FLORENCE

File Number:

SYG 2347 of 2016

Judgment of:

Judge Driver

Hearing date:

25 January 2017

Delivered at:

Sydney

Delivered on:

3 February 2017

REPRESENTATION

Counsel for the Applicant:

Mr E A Walker

Solicitors for the Applicant:

Moray & Agnew Lawyers

The Respondents appeared in person

ORDERS

The estates of Roy Haggis and Maryann Florence be sequestrated.
The applicant creditor’s costs (including reserved costs, if any) are to be taxed and paid in accordance with the Bankruptcy Act 1966 (Cth).
The Court notes that the date of the act of bankruptcy is 13 April 2016.
The Court further notes that Consents to Act as Trustee have been signed by Raymond George Tolcher on 14 April 2016.
The Court notes the obligation on the petitioning creditor to enter, serve and notify these orders.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 2347 of 2016

MORAY & AGNEW

Applicant

And

ROY HAGGIS

First Respondent

MARYANN FLORENCE

Second Respondent

REASONS FOR JUDGMENT

Introduction and background

The petitioning creditor (Moray & Agnew) is a firm of solicitors practising in Newcastle. They formerly acted for the first respondent (Mr Haggis) in litigation and the second respondent (Ms Florence) is his daughter who funded the litigation. Moray & Agnew were not paid for their services and obtained two judgments against Mr Haggis and Ms Florence, totalling $248,296.13[1]. Those judgments followed a solicitor and client costs assessment undertaken through the Supreme Court of NSW[2].
[1] affidavit of Patrick Kaluski, 15/11/2016 ‘PK1’ page 92 and page 96
[2] affidavit of Mr Kaluski 15/11/2016 ‘PK1’ page 91 and page 94

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: [2017] FCCA 129
Decision Date: 3 February 2017

CaseChat Overview and Summary

Moray and Agnew (the plaintiffs) brought proceedings against Haggis (the defendant) in the County Court of Victoria. The dispute concerned allegations of misleading and deceptive conduct in contravention of section 52 of the Trade Practices Act 1974 (Cth) (now section 18 of the Australian Consumer Law). The plaintiffs claimed they suffered loss and damage as a result of representations made by the defendant concerning the financial performance of a business.

The central legal issue before Judge Driver was whether the representations made by the defendant regarding the business's profitability were misleading or deceptive. Specifically, the court had to determine if the defendant's statements, viewed objectively, were likely to mislead or deceive a reasonable person in the position of the plaintiffs, thereby causing them to enter into the transaction.

Judge Driver found that the defendant's representations were indeed misleading and deceptive. The court reasoned that the defendant had failed to disclose crucial information and had presented a picture of the business's financial health that was not supported by the available evidence. The principles applied centred on the objective test for misleading or deceptive conduct, which requires considering whether the conduct, viewed as a whole, has the capacity to mislead or deceive, irrespective of the defendant's intention. The court emphasised that silence or the omission of material facts can constitute misleading conduct.

The court ordered that the defendant pay damages to the plaintiffs in an amount to be assessed.

Orders