National Australia Bank Limited v Sawyers Holdings Pty Ltd

[2003] WADC 158

JURISDICTION     :   DISTRICT COURT OF WESTERN AUSTRALIA

IN CHAMBERS

LOCATION:   PERTH

CITATION:   NATIONAL AUSTRALIA BANK LIMITED -v- SAWYERS HOLDINGS PTY LTD [2003] WADC 158

CORAM:   DEPUTY REGISTRAR HARMAN

HEARD:   22 MAY 2003

DELIVERED          :   21 JULY 2003

FILE NO/S:   CIV 982 of 2002

BETWEEN:   NATIONAL AUSTRALIA BANK LIMITED

Plaintiff

AND

SAWYERS HOLDINGS PTY LTD
Defendant

Catchwords:

Practice - Western Australia - Practice under the Rules of the Supreme Court - Application to amend defence - Turns on own facts

Legislation:

Nil

Result:

Application dismissed

Representation:

Counsel:

Plaintiff:     Ms J E Bartlett

Defendant:     Mr B P Wheatley

Solicitors:

Plaintiff:     Jackson McDonald

Defendant:     Nicholson Clement

Case(s) referred to in judgment(s):

Nil

Case(s) also cited:

Beecham Group Ltd v Bristol-Myers Co [1979] VR 273

1. DEPUTY REGISTRAR HARMAN:  The plaintiff's claim is for damages for conversion of chattels acquired by the plaintiff as a consequence of the exercise its power under security provided by Palmprint Pty Ltd. 

2. By the application of the defendant filed 2 April 2003 it seeks to join its directors as further defendants to the action.  The existing and proposed defendants then seek to amend the defence and to add a counterclaim by the proposed defendants.

3. The onus in the application to amend is on the applicants.  The essential purpose of a pleading being to inform, the sufficiency of the proposed pleading ought to be the test of that application.

4. At par 2 the proposed defendants are described as the owners of the real estate identified by the plaintiff as the property upon which the chattels, were located on the material date. 

5. At par 6(a) Palmprint is identified as the tenant of the premises by which it is implicit that it took on the obligation to make good particular damage.  It is conceivable that the tenancy also founded the obligations the subject of the allegations in par 6(b) and par (c) to pay for the costs of storage of its assets and to remove its assets and rubbish.

6. On a broader analysis of the pleading at that point, I can understand why the proposed defendants as owners of the real estate may have the entitlements alleged to have been the subject of the pleaded waiver at par 6 but not so the existing defendant.  A fundamental difficulty that I have with the existing defendant's case is that if it had exercised the lien for which it claims how it would it be entitled to claim for storage.

7. By par 6 it is contended that the plaintiff owed the same obligations as the mortgagee of Palmprint.  There is no pleading of the basis of that allegation.  So far as I am aware it is not a matter of law that the mortgagee in possession owes any obligation to the a land owner on which its security is located to make good or remove rubbish and other materials from the premises. 

8. The defendants later contend at par 7 that the agreement pleaded at par 6 was concluded and at par 8A that at least the proposed defendants released the plaintiff from all such claims and reinstated the premises to its former condition.  At par 8B the defendants plead that they acted to their detriment and at par 9 that the plaintiff is estopped from claiming that the first defendant wrongfully converted Palmprint's assets. 

1. It is only in relation to a substantive case that the concept of waiver has any meaning.  It follows from that analysis that the deficiency in the pleading is significant.  In my opinion what is missing could not properly be described as a condition precedent but at best something implicit on the pleading.  As to whether the plaintiff is obliged to pay storage costs or remove the chattels in my opinion there ought to be a pleaded case. 

2. The second fundamental deficiency that I perceive in the pleading is the reference in par 9 to the first defendant's equitable lien as unpaid vendor.  Having listened to the submissions of the parties I accept that that allegation has got nothing to do with the transactions the subject of the pleadings but rather to a prior dealing between the defendant and Palmprint whereby Palmprint purchased the defendant's business.  There is no allegation of material fact upon which to found the allegation that the defendant was either an unpaid vendor or that it held an equitable lien. 

3. At par 10F, there is a relevant pleading, which refers to of the plaintiff's knowledge such as to constitute the plaintiff as occupying a position of advantage vis-à-vis the defendant.  In that context it is pleaded that the plaintiff loaned Palmprint the purchase price for the business.  That amount loaned appears to have been held by the plaintiff by some contractual arrangement with the proposed defendants.

4. In my opinion that is an insufficient pleading to justify the allegation that the defendant was an unpaid vendor.

5. At par 8A the defendants refer to the content of par 7B, as a representation.  Paragraph 7B is as follows:-

   "At the meeting referred to in paragraph 7 above, Mr Greg Daniel, a manager of the plaintiff represented to male second defendant, that the second defendants should request the plaintiff to pre-pay (sic) the term deposit for $100,000 and retire their guarantee."

6. In my opinion par 7B is not sufficiently pleaded as a representation. 

7. The defendants plead at par 8 that they did request the plaintiff to repay the term deposit and retire the guarantee in the names of the second defendants.  At par 8B they plead that they acted to their detriment in reliance upon the plaintiff's conduct described in par 8A. 

1. However no conduct of the plaintiff is either pleaded or particularised at par 8A.  And so it is, that it is difficult to follow whatever case the defendants seek to make founded upon that paragraph. 

2. The next significant proposed amendment at is at par 9 where the existing defendant claims an equitable lien as unpaid vendor.  It is proposed by the defendants that the equitable lien claimed would have the effect of estopping the plaintiff from claiming that the existing defendant wrongfully converted Palmprint's assets to its own use. It appears to me that if the defendants were correct in that assessment then it would have a significant impact upon the law with which I am familiar.  It may be that an equitable lien would take effect but not by estoppel.

3. The proposal to amend the pleading has an impact upon the application to join additional defendants.  I have no difficulty with the prospect that a party may be joined as plaintiff by counterclaim.  It is a matter of whether it is appropriate to allow for that prospect at this stage in the action.  The submissions at the hearing of the application did not extend beyond my reasons and in the circumstances perhaps it is not appropriate to take the matter any further. 

4. In my opinion the application at least in so far as it relates to the proposed amended pleading should be dismissed.