(1) Subject to the leave referred to in [912], I propose to enter judgment in favour of the plaintiff against the second and fourth defendants in accordance with these reasons for judgment.
(2) The parties are to bring in Short Minutes of Order to give effect to this judgment and any agreed orders as to interest and costs.
(3) The proceedings will be re-listed on Tuesday, 20 May 2014 at 2.00pm for the purpose of orders (1) and (2) above.
Catchwords:
COMMON LAW - negligence - negligent misstatement by solicitor - misleading and deceptive conduct - breach of s 42 of the Fair Trading Act 1987 (NSW) - representations made concerning operation of an investment scheme and alleged safeguards in place for investors' funds - representations made by proponents of the investment scheme and their solicitor - absence of a disclaimer - defendant solicitor in making representations was not a mere conduit - continuing duty to inform the plaintiff prior to investment of funds in the scheme - failure to exercise reasonable care - failure by defendant solicitor to verify the accuracy of the representations - representations induced the plaintiff to make the investments - plaintiff's reliance on representations was reasonable - defendant solicitor owed a duty of care to the plaintiff - defendant solicitor drafted the investment contracts on behalf of both parties, provided services and, in securing investors' funds used for bridging finance to third parties, drafted and completed mortgages and caveats - defendant solicitor was available to answer plaintiff's questions in relation to the investments - professional negligence - implied retainer existed between the plaintiff and the defendant solicitor - breach of fiduciary duty - defence of contributory negligence not established - proportionate liability in accordance with Part 4 of the Civil Liability Act 2002 (NSW) - principles and approach in application of the statutory proportionate liability regime - causes of action in negligence, breach of s 42 of the Fair Trading Act 1987 (NSW) and breach of fiduciary duty predicated on and arising from failure of solicitor to take reasonable care - claim based thereon apportionable claim - assessment of respective degrees of responsibility of concurrent wrongdoers - apportionment of liability between concurrent wrongdoers - damages pursuant to s 1324(10) of the Corporations Act 2001 (Cth) only available where an injunction is actually sought
[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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AGLC
Polon v Dorian [2014] NSWSC 571
Case
[2014] NSWSC 571
Decision Date
CaseChat Overview and Summary
In the matter of Polon v Dorian, the plaintiff brought an action against the defendant, a solicitor, seeking damages for losses incurred through investments in an investment scheme. The plaintiff alleged that the defendant's representations concerning the operation of the investment scheme and the safeguards in place for the investors' funds were misleading and deceptive, constituting a breach of section 42 of the Fair Trading Act 1987 (NSW). The plaintiff claimed that the defendant's actions amounted to professional negligence, a breach of fiduciary duty, and misleading and deceptive conduct.
The court was tasked with determining whether the defendant solicitor owed a duty of care to the plaintiff, whether the defendant breached that duty, and if so, whether the plaintiff's reliance on the defendant's representations was reasonable. Additionally, the court had to assess the defendant's defence of contributory negligence and determine the appropriate apportionment of liability between the parties in accordance with the Civil Liability Act 2002 (NSW) and the principles established in relevant case law.
The court found that the defendant did owe a duty of care to the plaintiff, and that duty was breached when the defendant failed to exercise reasonable care in verifying the accuracy of the representations concerning the investment scheme. The plaintiff's reliance on these representations was deemed reasonable, and the court held that an implied retainer existed between the plaintiff and the defendant. Furthermore, the court rejected the defence of contributory negligence and found that the defendant's actions constituted a breach of fiduciary duty. The court applied the Civil Liability Act 2002 (NSW) to apportion the liability between the parties, and determined that damages pursuant to section 1324(10) of the Corporations Act 2001 (Cth) were only available if an injunction was actually sought.
In conclusion, the court awarded the plaintiff damages against the defendant, apportioning liability in accordance with the Civil Liability Act 2002 (NSW). The court found that the defendant was liable for the plaintiff's losses and that the statutory proportionate liability regime was applicable. The court also determined that the claim was an apportionable claim, and assessed the respective degrees of responsibility of the concurrent wrongdoers in accordance with the principles established in relevant case law.