Paton v Reck

[1999] QCA 517

SUPREME COURT OF QUEENSLAND

CITATION:	Paton & Anor v Reck & Ors [1999] QCA 517
PARTIES:	HECTOR ROBERT PATON and NANCY ANN PATON (plaintiffs/respondents) v FREDERICK GEORGE RECK, DELMA FAY RECK, ARTHUR LESLIE RECK and FE SUGABO RECK (defendants/appellants)
FILE NO/S:	Appeal No 319 of 1999 DC No 68 of 1996
DIVISION:	Court of Appeal
PROCEEDING:	General Civil Appeal
ORIGINATING COURT:	District Court at Bundaberg
DELIVERED ON:	17 December 1999
DELIVERED AT:	Brisbane
HEARING DATE:	23 July 1999
JUDGES:	McMurdo P, Davies JA and White J Joint reasons for judgment of Davies JA and White J; separate reasons of McMurdo P concurring as to the order made.
ORDER:	Appeal dismissed with costs
CATCHWORDS:	PARTNERSHIP – RIGHTS AND DUTIES OF PARTNERS INTER SE – FIDUCIARY RELATIONSHIP – appeal against declaration that sum be held on constructive trust to account to partnership – prawn farming partnership in abeyance but not dissolved – land owning partners sold property – whether benefit received by virtue of non- transferable aquaculture permit – whether breach of fiduciary duty and unconscionable conduct – whether liable to account to partners
Birtchnell v Equity Trustees Executors and Agency Co Ltd (1929) 42 CLR 384, applied Chan v Zacharia (1984) 154 CLR 178, discussed Harvey v Harvey (1970) 120 CLR 529, distinguished In re Coomber; Coomber v Coomber [1911] 1 Ch 723, distinguished Muschinski v Dodds (1985) 160 CLR 583, applied Warman International Ltd v Dwyer (1995) 182 CLR 544, discussed
Baumgartner v Baumgartner (1987) 164 CLR 137, applied DEALINGS WITH PARTNERSHIP PROPERTY – whether partnership's prawn farming activities and approvals, although not transferable, increased the value of the property – whether equitable for land owning partners to retain whole benefit of increased value upon sale of the property
PARTNERSHIP – RIGHTS AND DUTIES OF PARTNERS INTER SE – EQUITABLE REMEDIES AND RELIEF – ACCOUNTS – whether trial judge erred in assessment of quantum of profit to be brought to account
Partnership Act 1891, s 32
Ravinder Rohini Pty Ltd v Krizaic (1991) 30 FCR 300, discussed Warman International v Dwyer (1995) 182 CLR 544, applied
COUNSEL:	Mr J C Bell QC, with him Mr R P S Jackson, for the appellants Mr D B Fraser QC, with him Mr T C Somers, for the respondents
SOLICITORS:	Hopgood Ganim for the appellants Macdonald & Michel for the respondents

1. McMURDO P: This is an appeal in respect of a declaration made in the District Court that the male appellants hold the sum of $130,000 on a constructive trust to account to the partnership established under a deed of partnership between the appellants and respondents.

   The facts

2. The male appellants owned a 144ha farm on the bank of Littabella Creek, north of Bundaberg, where they carried on small crop farming. The male respondent had been a truck driver and had business dealings with the appellants. He became interested in prawn farming and discussed it with the appellants; the result was the formation and operation…