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

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2012] WASC 161
Case No:	CIV:1658/2011	Heard:	26 MARCH 2012
Coram:	PRITCHARD J	Delivered:	22/05/12
No of pages:	32	Judgment Part:	1 of 1
Result:	Plaintiff successful
Category:	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…

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.

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Details

Case: [2012] WASC 161
Decision Date: 22/05/2012

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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