Parsons v Momovivo (HK) Ltd - [2020] WASC 75

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   PARSONS -v- MOMOVIVO (HK) LTD [2020] WASC 75
CORAM:   ACTING MASTER WHITBY
HEARD:   18 FEBRUARY 2020
DELIVERED          :   11 MARCH 2020
FILE NO/S:   CIV 1475 of 2019
BETWEEN:   KERRY GEORGE PARSONS
Plaintiff
AND
MOMOVIVO (HK) LTD
First Defendant
SUREFOOT SYSTEMS INTERNATIONAL LTD
Second Defendant

Catchwords:

Summary judgment - Serious question to be tried - Whether concluded contract - Formal contract not executed - Authority of solicitor negotiating on behalf of client

Legislation:

Rules of the Supreme Court 1971 (WA)

Result:

Plaintiff's application for summary judgment against the first defendant be dismissed

Category: B

Representation:

Counsel:

Plaintiff	:	J P Cook
First Defendant	:	T Masson
Second Defendant	:	T Masson

Solicitors:

Plaintiff	:	Mendelawitz Morton Commercial Lawyers
First Defendant	:	Ensign Legal
Second Defendant	:	Ensign Legal

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

Agar v Hyde (2000) 201 CLR 552
Fancourt v Mercantile Credits Ltd (1983) 154 CLR 87
Field Camp Services Pty Ltd v Site Accommodation Pty Ltd [No 2] [2012] WASCA 27
Pavlovic v Universal Music Australia Pty Ltd [2015] NSWCA 313
Re Crowe Consulting Pty Ltd [2019] NSWSC 1414
Webster v Lampard (1993) 177 CLR 598
Westpac Banking Corporation v Anderson [2017] WASC 106

ACTING MASTER WHITBY:

This is the plaintiff's application by chamber summons for summary judgment pursuant to O 14 of the Rules of the Supreme Court 1971 (WA). The plaintiff seeks the following orders:
(a)a declaration that the Agreement (as defined in the statement of claim) is a binding contract comprised of the terms contained within the instruments entitled respectively as 'Share Purchase Agreement', 'Licence Agreement' and 'Royalty Agreement';
(b)a declaration that the first defendant repudiated the Agreement;
(c)a declaration that the plaintiff is entitled to affirm the Agreement and pursue the performance thereof in accordance with its terms; and
(d)the first defendant pay the plaintiff's costs to be taxed.

The evidence

The plaintiff relies on the following affidavits:
(a)Affidavit of Kerry George Parsons sworn 11 November 2019 (First Parsons Affidavit);
(b)Affidavit of Kerry George Parsons sworn 20 January 2020 (Second Parsons Affidavit); and
(c)Affidavit of Mark Mendelawitz sworn 21 January 2020 (Mendelawitz Affidavit).
The first defendant relies on the following affidavits:
(a)Affidavit of Gary Stephen Gale sworn 20 December 2019 (Gale Affidavit); and
(b)Affidavit of Ivan Oshry sworn 7 February 2020 (Oshry Affidavit).
At the hearing of this application I ruled on objections to the Gale Affidavit and the Oshry Affidavit.
I struck out the following from:
5.1the Gale Affidavit:
(a)pars 18 to 23(inclusive);
(b)the words 'were to' in the first sentence of, the second and third sentences of par 30;
(c)pars 31 and 32;
(d)the words 'Consistent with the parties mutual understanding' and 'indicating that the solicitors had reached an in‑principle agreement' in par 36;
(e)the second sentence of par 40;
(f)par 42;
(g)the second sentence of par 48; and
(h)pars 52 to 68,
5.2the Oshry Affidavit:
(a)par 8; and
(b)par 10.
Save for those struck…

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: [2020] WASC 75
Decision Date: 11 MARCH 2020

CaseChat Overview and Summary

In Parsons v Momovivo (HK) Ltd, the plaintiff sought summary judgment against the defendant, a Hong Kong company, for breach of contract. The dispute centred around whether a binding contract had been concluded between the parties, particularly given that no formal contract had been executed. The matter was heard in the Federal Court of Australia.

The central legal issues the court had to address were whether the conduct of the parties demonstrated the formation of a binding contract and whether the solicitor who negotiated on behalf of the plaintiff had the necessary authority to bind the plaintiff to any agreement. Specifically, the court needed to determine whether the solicitor's conduct could be imputed to the plaintiff as an act of apparent authority.

The court found that there was a serious question to be tried regarding whether a binding contract had been formed. It was determined that the conduct of the parties, including negotiations and correspondence, suggested an intention to be legally bound, but the lack of a formal executed contract created doubt. Furthermore, the court held that the solicitor did not have actual or apparent authority to enter into a binding agreement on behalf of the plaintiff without proper instructions. This conclusion was based on the absence of clear evidence that the solicitor had the requisite authority to bind the plaintiff in the manner alleged.

The court ultimately ruled that the plaintiff had not demonstrated that there was no real prospect of success on the claim for breach of contract, given the unresolved issues regarding the existence of the contract and the authority of the solicitor. Consequently, the plaintiff's application for summary judgment was dismissed.

Orders