Panton v Bailey and 4 Ors - [2003] NSWSC 407

CITATION: PANTON v. BAILEY & 4 ORS [2003] NSWSC 407

HEARING DATE(S): 07-08/05/03

JUDGMENT DATE:
30 May 2003

JURISDICTION:
Equity

JUDGMENT OF: Bryson J at 1

DECISION: Appeal dismissed, Cross-appeal allowed, Statement of Claim struck out [69]

CATCHWORDS: NEGLIGENCE - essentials of action for negligence - where economic or financial loss - negligent misstatement - Statement of Claim alleged negligence where Defendants gave information to Bank which led Bank to advance money to Cox which Cox used to purchase land and Plaintiff entered into partnership with Cox for vineyard and winery on the land - plaintiff also consulted defendnats for tax advice - Master struck out Statement of Claim and allowed leave to amend - on appeal and cross-appeal, struck out without leave to amend - consideration of development of law of economic loss torts - consideration of causation, Fair Trading Act and Fiduciary Duty Claims. - PRACTICE and PROCEDURE - pleadings - striking out Statement of Claim Pt15 r.26 where pleading discloses no reasonable cause of action - claim outside limits of negligent misstatement law.

LEGISLATION CITED: Supreme Court Rules Pt.15 r.26
s.68 of the Fair Trading Act 1987
s.82 of the Trade Practices Act 1974 (Cth)

CASES CITED: Aghajanian v. Stanley Thompson Valuers Pty Ltd [1999] NSWSC 1154
Australian Breeders Co-Operative Society Ltd v. Jones & Ors (1997) 150 ALR 488
Caltex Oil (Aust.) Pty Ltd v. The Dredge Willemstad (1976) 136 CLR 529
Caparo Industries PLC v. Dickman [1990] 2 AC 605
Esanda Finance Corporation Ltd v. Peat Marwick Hungerfords (1997) 188 CLR 241
Hedley Byrne & Co. Ltd v. Heller & Partners Ltd [1964] AC 465
Hill v. Van Erp (1997) 188 CLR 159
Perre v. Arpand Pty Ltd (1999) 198 CLR 180
San Sebastian v. The Minister (1986) 162 CLR 340
Hawkins v. Clayton (1988) 164 CLR 539
White v. Jones [1995] 2 AC 207
Ta Ho Ma Pty Ltd v. Allen (1999) 47 NSWLR 1
State of Western Australia v. Wardley Australia Ltd & Ors (1991) 30 FCR 245
Wardley Australia Ltd v. State of Western Australia (1992) 175 CLR 514
Janssen Calag Pty Ltd v. Pfizer Pty Ltd (1992) 37 FCR 526
March v. E & MH Stramare (1991) 171 CLR 506
General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) (1964) 112 CLR 125
Bryan v. Maloney (1995) 182 CLR 609
Seas Sapfor Forests Pty Ltd & Ors v. Electricity Trust of South Australia (1996) 187 LSJS 369
McMullin v. ICI Australia Operations Pty Ltd [1997] 72 FCR 1
Johnson Tiles Pty Ltd v. Esso Australia Pty Ltd [2003] VSC 27

PARTIES :
Bernard John Panton - Plaintiff
Bruce Leonard Bailey, Peter Charles Mattock and Peter John Saccasan t/as Saccasan Bailey Partners

FILE NUMBER(S): SC 5534/01

COUNSEL: Plaintiff in Person
R. Dubler - Defendant

SOLICITORS: John R. Quinn & Co. - Plaintiff
Phillip Fox Lawyers - Defendant

LOWER COURTJURISDICTION: Supreme Court (Master)

LOWER COURT FILE NUMBER(S): SC 5534/01

LOWER COURT
JUDICIAL OFFICER : Acting Master Berecry

IN THE SUPREME COURT
OF NEW…

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: [2003] NSWSC 407
Decision Date: 30 May 2003

CaseChat Overview and Summary

The case of Panton v Bailey and 4 Ors was heard by the court, which involved the plaintiff, Panton, suing several defendants, including Bailey, for damages arising from a series of alleged negligent actions. The crux of the dispute was that the defendants, who were either accountants or financial advisors, provided certain information to a bank. This information led the bank to grant a loan to Cox, who then used the funds to purchase a piece of land. Panton subsequently entered into a partnership with Cox to develop a vineyard and winery on this land. Panton further alleged that he had consulted the defendants for tax advice related to this venture. The court was tasked with determining whether Panton's claims, based on the defendants' alleged negligence, were legally sound and actionable.

The central legal issues the court had to address included whether Panton's claims for economic loss, specifically those stemming from a negligent misstatement, were valid. The court had to consider the evolving legal framework governing economic loss torts, particularly in relation to negligent misstatements. Additionally, the court examined whether the defendants' actions could be deemed a proximate cause of Panton's financial losses. The applicability of the Fair Trading Act and the potential for fiduciary duty claims were also examined. The court was required to determine if Panton's Statement of Claim met the legal standards necessary to proceed to trial.

The court ultimately concluded that Panton's claims were not legally tenable and, therefore, struck out the Statement of Claim without leave to amend. The reasoning focused on the foundational elements of a negligence claim, particularly in cases of economic loss. The court found that Panton's claims were outside the established parameters of the law of negligent misstatement. It was held that Panton had failed to demonstrate a sufficient legal basis for his claims, particularly in terms of causation and the reliance on the defendants' advice. The court's decision was grounded in the principles of pleadings and the procedural rules under Part 15, Rule 26 of the relevant legislation. This ruling meant that Panton's case could not proceed further in the legal process.

The final orders of the court confirmed the striking out of Panton's Statement of Claim without leave to amend, effectively terminating his legal action against the defendants. This decision underscored the stringent requirements for establishing a cause of action in cases involving economic loss and negligent misstatement. The court's ruling highlighted the importance of aligning claims with established legal principles and the procedural rules governing such cases.

Orders