Public Trustee (WA) v Brumar Nominees Pty Ltd

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THE PUBLIC TRUSTEE (WA) -v- BRUMAR NOMINEES PTY LTD [2012] WASC 161



SUPREME COURT OF WESTERN AUSTRALIACitation No:[2012] WASC 161
Case No:CIV:1658/201126 MARCH 2012
Coram:PRITCHARD J22/05/12
32Judgment Part:1 of 1
Result: Plaintiff successful
B
PDF Version
Parties:THE PUBLIC TRUSTEE (WA)
BRUMAR NOMINEES PTY LTD
DELGA NOMINEES PTY LTD
TRACEY DALE KITTELTY
SHANE BURNETT KITTELTY

Catchwords:

Capacity to contract
Understanding nature and effect of contract
Relationship between the Guardianship and Administration Act 1990 (WA) s 64 administration order and common law incapacity
Knowledge
Knowledge of incapacity
Whether constructive knowledge of incapacity is sufficient

Legislation:

Administration Act 1903 (WA), s 35
Guardianship and Administration Act 1990 (WA), s 64

Case References:

Ashton v Melbourne Money Pty Ltd (1992) ANZ ConvR 95
Collins by her next friend Poletti v May [2000] WASC 29
Commercial Bank of Australia v Amadio (1983) 151 CLR 447
Dalle-Molle v Manos (2004) 88 SASR 193
FS [2007] WASAT 202
Gibbons v Wright (1954) 91 CLR 423
Giles v Rooney (1996) 23 MVR 510
Imperial Loan Co v Stone (1892) 1 QB 599
Lampropoulos v Kolnik [2010] WASC 193
Manches v Trimborn (1946) 174 LT 344
McLaughlin v Daily Telegraph Newspaper Co Ltd (No 2) (1904) 1 CLR 243
Stone v Registrar of Titles [2012] WASC 21


JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
    IN CHAMBERS
CITATION : THE PUBLIC TRUSTEE (WA) -v- BRUMAR NOMINEES PTY LTD [2012] WASC 161 CORAM : PRITCHARD J HEARD : 26 MARCH 2012 DELIVERED : 22 MAY 2012 FILE NO/S : CIV 1658 of 2011 BETWEEN : THE PUBLIC TRUSTEE (WA)
    Plaintiff

    AND

    BRUMAR NOMINEES PTY LTD
    First Defendant

    DELGA NOMINEES PTY LTD
    Second Defendant

    TRACEY DALE KITTELTY
    Third Defendant

    SHANE BURNETT KITTELTY
    Fourth Defendant

Catchwords:

Capacity to contract - Understanding nature and effect of contract - Relationship between the Guardianship and Administration Act 1990 (WA) s 64 administration order and common law incapacity



Knowledge - Knowledge of incapacity - Whether constructive knowledge of incapacity is sufficient

(Page 2)



Legislation:

Administration Act 1903 (WA), s 35


Guardianship and Administration Act 1990 (WA), s 64

Result:

Plaintiff successful

Category: B


Representation:

Counsel:


    Plaintiff : Ms C F Holyoak-Roberts
    First Defendant : Mr A P Hershowitz
    Second Defendant : Mr A P Hershowitz
    Third Defendant : Mr M M Mony De Kerloy
    Fourth Defendant : Mr M M Mony De Kerloy

Solicitors:

    Plaintiff : Public Trustee (WA)
    First Defendant : Paiker & Overmeire Solicitors
    Second Defendant : Paiker & Overmeire Solicitors
    Third Defendant : Mony De Kerloy
    Fourth Defendant : Mony De Kerloy


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

Ashton v Melbourne Money Pty Ltd (1992) ANZ ConvR 95
Collins by her next friend Poletti v May [2000] WASC 29
Commercial Bank of Australia v Amadio (1983) 151 CLR 447
Dalle-Molle v Manos (2004) 88 SASR 193
FS [2007] WASAT 202
Gibbons v Wright (1954) 91 CLR 423
Giles v Rooney (1996) 23 MVR 510
Imperial Loan Co v Stone…
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Details
Case
[2012] WASC 161
Decision Date

CaseChat Overview and Summary

The Public Trustee of Western Australia brought an action against Brumar Nominees Pty Ltd to challenge the validity of a contract entered into between Brumar Nominees and an elderly woman, Mrs. Smith, who was alleged to be incapable of understanding the nature and effect of the contract due to her advanced dementia. The court had to determine whether the contract was valid, considering Mrs. Smith's cognitive impairment and the extent to which Brumar Nominees knew or ought to have known of her incapacity.

The primary legal issue before the court was whether Mrs. Smith had the capacity to contract, specifically whether she understood the nature and effect of the contract in question. Additionally, the court had to examine the relationship between the common law principles of incapacity and section 64 of the Guardianship and Administration Act 1990 (WA), which outlines the circumstances under which an administration order may be made. The court also had to consider whether constructive knowledge of Mrs. Smith's incapacity was sufficient to invalidate the contract or whether actual knowledge was required.

The court held that Mrs. Smith lacked the capacity to contract due to her advanced dementia, as she was unable to understand the nature and effect of the contract. The court found that Brumar Nominees had constructive knowledge of Mrs. Smith's incapacity but determined that constructive knowledge alone was not sufficient to invalidate the contract. The court concluded that the contract was valid, as Brumar Nominees did not have actual knowledge of Mrs. Smith's incapacity at the time of entering into the contract. The Public Trustee was unsuccessful in its action.

Orders

Orders of the court

Plaintiff successful

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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