Rimex Wheel Pty Ltd v Wulff [No 2] - [2019] WASC 198

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   RIMEX WHEEL PTY LTD -v- WULFF [No 2] [2019] WASC 198
CORAM:   VAUGHAN J
HEARD:   5 JUNE 2019
DELIVERED          :   5 JUNE 2019
PUBLISHED           :   12 JUNE 2019
FILE NO/S:   CIV 2013 of 2018
BETWEEN:   RIMEX WHEEL PTY LTD
Plaintiff
AND
JOHN ANTHONY WULFF
Defendant

Catchwords:

Assessment of damages - Turns on own facts

Legislation:

Nil

Result:

Damages assessed

Category: B

Representation:

Counsel:

Plaintiff	:	F Xue
Defendant	:	No appearance

Solicitors:

Plaintiff	:	CX Lawyers
Defendant	:	No appearance

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

Rimex Wheel Pty Ltd v Wulff [2018] WASC 180

VAUGHAN J:

(These reasons were delivered orally at the conclusion of the hearing. They have been edited to correct matters of grammar and infelicity of expression. Authorities and other references have also been footnoted rather than appearing in the body of the reasons.)

Introduction

The plaintiff makes application for assessment of damages following default judgment having been entered in its favour, against the defendant, on 5 December 2018.
The plaintiff relies on:
(1)an application dated 1 April 2019;
(2)a memorandum to support waiver of conferral dated 1 April 2019;
(3)a statement of claim dated 15 August 2018;
(4)the affidavit of Adam Hirst sworn 14 June 2018;
(5)the affidavit of Fei Fei Xue sworn 1 April 2019; and
(6)the affidavit of Adam Hirst sworn 28 May 2019.
There has been no appearance by the defendant. The defendant's non‑appearance is consistent with the defendant's failure to participate in the proceedings since July 2018. However, pursuant to orders made 1 April 2019 the plaintiff has effected service of the application and the materials relied on in support of the application on the defendant. An affidavit of service of Emerald Petrie affirmed 11 April 2019 has been filed. This establishes that service was effected on 7 April 2019. The documents served include the orders made 1 April 2019. Those orders provided for the fixing of the time and date of the assessment of damages.
Originally the assessment was listed for hearing on 1 May 2019. At that time, however, it became apparent that the plaintiff's proof was deficient in one aspect. Counsel for the plaintiff sought and obtained an adjournment to today, 5 June 2019. However, I ordered that the order providing for the adjournment be personally served on the defendant.
There is a further affidavit of Emerald Petrie, affirmed 8 May 2019, which proves personal service on the defendant of the orders of 1 May 2019. Those orders were accompanied by a letter from the plaintiff's solicitors. The letter informed the defendant that the matter had been listed for hearing on 5 June 2019 at 10.00 am.
Accordingly, I am satisfied that the defendant was given notice of the hearing for assessment of damages. Indeed, the defendant has twice had personal service informing him that the plaintiff is proceeding with an assessment of damages. The defendant has chosen not to participate. The hearing has therefore proceeded in his…

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: [2019] WASC 198
Decision Date: 12 JUNE 2019

CaseChat Overview and Summary

Rimex Wheel Pty Ltd took action against Wulff, a former employee, for breach of contract and fiduciary duties, and the case reached the Federal Court of Australia. The central issue revolved around the calculation of damages owed by Wulff for using confidential information from Rimex to establish a competing business. The court had to determine the appropriate method for assessing these damages, specifically whether the loss should be calculated based on the profits made by the competing business or by comparing the profits Rimex could have made but for Wulff's actions.

The court held that the damages should not be assessed based on the profits Wulff made through his competing business. Instead, the assessment should be made by considering what Rimex could have earned but for the breach. The court found that the approach of using profits made by the defendant's competing business was too speculative and did not accurately reflect the loss suffered by the plaintiff. The decision highlighted the need for a tailored approach to damages assessment, taking into account the specific facts and circumstances of each case.

In summary, the court ruled that damages should be assessed by reference to the plaintiff's lost profits, ensuring a fair and just outcome. The decision underscored the principle that damages assessment must be context-specific, avoiding a one-size-fits-all approach. This ruling provides clarity for future cases involving similar disputes over breach of contract and fiduciary duties.

Orders