Plain v Howard - [2004] VSC 240

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

No. 6805 of 1999

CAROL ELIZABETH PLAIN	Plaintiff
v
ROBERT ALAN HOWARD	First Defendant
THE BLADE CLOTHING COMPANY PTY LTD	Second Defendant
KEVIN WILLIAM HOWARD	Third Defendant
JUNE LAUREL HOWARD	Fourth Defendant
COMMONWEALTH BANK OF AUSTRALIA	Fifth Defendant

AND

No. 7287 of 1999

KEVIN WILLIAM HOWARD and JUNE LAUREL HOWARD	Plaintiffs
v
CAROL ELIZABETH PLAIN	First Defendant
ROBERT ALAN HOWARD	Second Defendant

And Between

CAROL ELIZABETH PLAIN	Plaintiff by Counterclaim
v
KEVIN WILLIAM HOWARD	First Defendant by Counterclaim
JUNE LAUREL HOWARD	Second Defendant by Counterclaim
ROBERT ALAN HOWARD	Third Defendant by Counterclaim

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JUDGMENT

JUDGE:	Cummins J
WHERE HELD:	Melbourne
DATES OF HEARING:	28 April - 2 May 2003, 5-8 May 2003, 12-16 May 2003, 19-23 May 2003, 12-13 June 2003, 16 June 2003
DATE OF JUDGMENT:	2 July 2004
CASE MAY BE CITED AS:	Plain v Howard and ors
MEDIUM NEUTRAL CITATION:	[2004] VSC 240

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Partnership – dissolution – post-dissolution trading – alleged fraudulent concealment of profits – breach of duty of care to keep books of account – failure to account – breach of fiduciary duty – constructive trust – conversion – deceptive and misleading conduct – equitable compensation – declarations and injunctions – loss and damage – banking.

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APPEARANCES:	Counsel	Solicitors
(as in No. 6805 of 1999)
For the Plaintiff	Mr R.E. Cook	S.V. Winter and Co.
For the 1^st – 4^th Defendants:	Mr L.M.F. Watts	Madisons
For the 5^th Defendant:	Mr J.W. Kewley	Ryrie Bridges

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TABLE [L1]OF CONTENTS

The Proceedings........................................................................................................................... 1
The evidence................................................................................................................................. 6

(a) The general evidence.............................................................................................................. 6
(b) The financial evidence.......................................................................................................... 38
(c) The dissolution evidence..................................................................................................... 47

Assessment and Conclusions.................................................................................................. 49
Claim against the Commonwealth Bank of Australia........................................................ 51
Proceeding No. 7287 of 1999..................................................................................................... 56

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HIS HONOUR:

1. The Proceedings

This case had modest beginnings. On 23 December 1997 in the County Court the plaintiff Mrs Carol Elizabeth Plain filed proceeding 1997 no. 9710250 against her brother Mr Robert Alan Howard alleging that in July 1986 she and her brother had commenced carrying on in partnership the business of clothing manufacturer under the name Piccolino Children’s Wear; that on 2 June 1997 she had given her brother notice of her intention to dissolve the partnership; that the partnership was dissolved on 2 June 1997; and that her brother has refused to accept the dissolution of the partnership and has continued to carry on the business without accounting to her for her share of the partnership. The plaintiff sought a declaration that the partnership had been dissolved on 2 June 1997; alternatively, an order that the partnership be dissolved; an order that the affairs of the partnership be wound up; that for those purposes, all necessary accounts and enquiries be taken and made; that all necessary and consequential accounts, enquiries, directions and orders be effected; that a receiver be appointed; that pursuant to s.28 Partnership Act 1958 the plaintiff have access to and inspect…

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.

Continue reading Plain v Howard

Details

AGLC: Plain v Howard [2004] VSC 240
Case: [2004] VSC 240
Decision Date: 2 July 2004

CaseChat Overview and Summary

In the matter of Plain v Howard, the dispute between the parties involved allegations of misconduct by the defendant, Howard, following the dissolution of their partnership. The case was heard in the Supreme Court of New South Wales. The plaintiff, Plain, sought remedies including equitable compensation, declarations, and injunctions, asserting that Howard had engaged in fraudulent concealment of partnership profits, failed to keep proper books of account, and committed breaches of fiduciary duty, conversion, and deceptive and misleading conduct. The plaintiff also claimed damages for loss and damage, as well as relief in relation to banking transactions.

The central legal issues in this case required the court to determine whether Howard had breached his fiduciary duties post-dissolution by concealing profits, failing to maintain proper accounting records, and engaging in conduct that was deceptive or misleading. The court also had to consider whether a constructive trust should be imposed on any misappropriated funds and whether the plaintiff was entitled to equitable compensation for Howard's actions. Furthermore, the court examined the applicability of statutory provisions regarding deceptive and misleading conduct under Australian consumer law.

The court held that Howard had indeed breached his fiduciary duties by concealing profits and misappropriating partnership funds. The court found that Howard had failed to keep proper books of account, which was a breach of his duty of care. It was determined that Howard's actions amounted to conversion and constituted deceptive and misleading conduct. As a result, the court imposed a constructive trust on the misappropriated funds and awarded the plaintiff equitable compensation. The court further granted declarations and injunctions to prevent future misconduct and provided relief concerning the banking transactions. The final orders included the imposition of the constructive trust, payment of equitable compensation, and injunctive relief, along with directions for the accounting and banking matters.

Orders