Peter Stannard Homes Pty Ltd v Wishart - [2000] WADC 223

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
CHAMBERS

LOCATION: PERTH

CITATION: PETER STANNARD HOMES PTY LTD -v- WISHART & ANOR [2000] WADC 223

CORAM: FENBURY DCJ

HEARD: 26 MAY 2000

DELIVERED : 28 JUNE 2000

FILE NO/S: CIV 3360 of 1999

BETWEEN: PETER STANNARD HOMES PTY LTD
Plaintiff
AND
PETER WILLIAM WISHART
First Defendant
KEITH LESLIE TURNER
Second Defendant

Catchwords:

Appeal from Registrar's decision granting time to amend pleadings - Turns on own facts

Legislation:

Nil

Result:

Appeal dismissed

Representation:

Counsel:

Plaintiff:     Ms M J Watson
First Defendant             :     No Appearance
Second Defendant         :     Mr S D Pentony

Solicitors:

Plaintiff:     Hotchkin Hanly
First Defendant             :     Deacons Graham & James
Second Defendant         :     Ian Tait

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

Nil

Case(s) also cited:

Nil

FENBURY DCJ: This was an appeal by the second defendant Keith Leslie Turner against a decision of a Registrar of this Court delivered on 3 February 2000 granting the plaintiff company leave to amend its statement of claim in terms of a minute of proposed amended statement of claim filed the same date.
The second defendant says that the Registrar's order should be set aside and instead that specific paragraphs in the plaintiff's minute be struck out on the grounds that (1) they disclosed no reasonable cause of action; (2) they are scandalous, frivolous or vexatious; (3) they may prejudice, embarrass or delay the fair trial of the action, and/or (4) they are otherwise an abuse of process of the Court.
The second defendant is a director of a company known as the Turner Corporation WA Pty Ltd, called the company. It is asserted in the statement of claim that at a meeting on or about 23 May 1996 where representatives of the plaintiff company were present together with the first and second defendants, certain things were stated and assurances given by the defendants with a view to causing the plaintiff to contract with the company. During this meeting it is asserted that a representative of the plaintiff expressed concerns to the first and second defendants about the company's access to finance in respect of six proposed building contracts relating to homes that the plaintiff was to construct.
It is asserted on behalf of the plaintiff that both the first and second defendants made statements in the course of this meeting to the representatives of the plaintiff that can be characterised as being promissory in their effect that in turn then gave rise to the formation of a contract, collateral to the proposed building contracts pleaded in paragraph 4 of the statement of claim or as described in that paragraph. Thus the plaintiff brings its action against the first and second defendant personally because of the failure of the company to meet its debts to the plaintiff.
The first ground of appeal is in the following terms:
The learned Registrar erred by concluding that the second defendant's alleged representations pleaded in paragraphs 5 and 6 were promissory. The second defendant contends that the representations as pleaded were not promissory and therefore that the collateral contract plea does not disclose a reasonable cause of action and/or is embarrassing.
It seems to me that it could not be said that paragraphs 5 and 6 of the statement of claim are elegantly drafted, but if they are read together, although the language may not be clearly promissory in its terms, a reasonable and proper inference is that the plaintiff was alleging that it was being assured that the company will meet its obligations to the plaintiff and pay its debts when they fall due.
I think the statements attributed to the second defendant pleaded in paragraphs 5 and 6 can reasonably be understood to be intended to have promissory effect. The second defendant was a director of the company and it is implicit in what he stated to the plaintiff that he would see to it that the plaintiff was paid. As a director he must have had knowledge of the company's financial resources. I do not think there is any substance in the first ground of appeal.
The second ground of appeal asserts:
The learned Registrar erred by concluding the second defendant provided consideration to the plaintiff to support the collateral contract. The second defendant contends that the collateral contract plea does not disclose a reasonable cause of action and/or is embarrassing.
I think this ground of appeal falls away following my rejection of ground 1. It is arguable that the second defendant did provide consideration to the plaintiff in the form of his promissory statement sufficient such so as to support the existence of the collateral contract alleged.
Ground 3 says:
The learned Registrar erred in concluding paragraph 16 was not embarrassing. The second defendant contends that this paragraph should be struck out by virtue of the plaintiff's failure to plead a date or dates upon which it alleges the second defendant did not have the financial resources to complete the building contracts.
I cannot quite follow this ground of appeal. Paragraph 16 of the statement of claim, on a fair reading, seems to me to be saying that the company did not have the financial ability to make payments on the dates that it failed to pay in respect of each of the six building contracts. Those dates have been pleaded.
The fourth ground of appeal states:
The learned Registrar erred in concluding paragraph 20 was not embarrassing and/or disclosed a reasonable cause of action. The second defendant contends that this paragraph should be struck out by virtue of the plaintiff's failure to plead how it is alleged the second defendant reached any collateral contract.
It appears that in paragraph 20 reference to paragraph 16 has been overlooked. Once it is recognised that paragraph 16 is one of those paragraphs upon which the assertion is based that the second defendant has breached the collateral contract, then I think the paragraph is no longer embarrassing.
Grounds 5 and 6 of the grounds of appeal raise criticisms about the method of calculation of damages asserting that a contractual measure was inappropriate. That might be so if no collateral contract was being pleaded but having regard to my view that the pleading adequately complies with the requirement to set out material facts upon which an assertion that a collateral contract was created is valid, then a contractual measure of damage would seem to me to be appropriate.
In any event, I am not convinced that a contractual measure of damages would be inappropriate if there was no claim in contract. As counsel for the plaintiff asserted, it is for the Court to determine what is the appropriate measure of damages recoverable by a plaintiff who suffered loss and damage whether by way of breach of contract or by way of breach of statute.
In grounds of appeal 6 and 7 the defendants assert that the learned Registrar erred in failing to strike out paragraphs (a) and (b) of the prayer for relief. Counsel particularly focused on paragraph (b) in the claim for interest at the rate of 14 per cent pursuant to the building contract.
The terms of the building contracts were not pleaded in the statement of claim but I do not think that means, necessarily, that the prayer for relief is bad and should be struck out. I think it is again a matter for the trial Judge and, as an observation, it appears unlikely that the plaintiff will succeed in that claim without pleading the basis for it.
In my view this appeal should be dismissed with costs. Perhaps, in other words, I do not think the orders of the Registrar should be disturbed.