Rowena Nominees Pty Ltd (Receiver and Manager Appointed) (in Liq) v LUNDIE
[2005] WASC 72
ROWENA NOMINEES PTY LTD (RECEIVER & MANAGER APPOINTED) (IN LIQ) -v- LUNDIE & ANOR [2005] WASC 72
| Link to Appeal : | [2006] WASCA 106 |
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2005] WASC 72 | |
| Case No: | CIV:2427/2004 | 21 MARCH 2005 | |
| Coram: | MASTER SANDERSON | 5/05/05 | |
| 7 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| B | |||
| PDF Version |
| Parties: | ROWENA NOMINEES PTY LTD (RECEIVER & MANAGER APPOINTED) (IN LIQ) ROBERT CHARLES LUNDIE JUDITH DIANNE LUNDIE |
Catchwords: | Summary judgment Application by plaintiff and defendant Turns on own facts |
Legislation: | Corporations Act 2001 (Cth), s 479(3) Property Law Act 1969 (WA), s 84 Rules of the Supreme Court 1971 (WA), O 16 |
Case References: | Australian Securities & Investments Commission v Rowena Nominees Pty Ltd [2003] WASC 106 Archer v Channel Seven Perth Pty Ltd [2001] WASC 195 Burton v The President of the Shire of Bairnsdale (1908) 7 CLR 76 Cameron v Troy & Co [2001] WASCA 400 Deputy Commissioner of Taxation v Robinswood Pty Ltd BC 200104403 Equiscorp Pty Ltd v Glengallon Investments Pty Ltd [2004] HCA 55 Evans v Bartlam [1937] AC 473 Fancourt v Mercantile Credits Limited (1983) 154 CLR 87 Forsayth NL v Northern Gold NL, unreported; FCt SCt of WA; Library No 940012; 20 January 1994 Gibbons v Wright (1954) 91 CLR 423 Jacob v Booths Distillery Co (1901) 85 LT 262 Knight v FP Special Assets Ltd (1992) 174 CLR 178 Lewkowski v Bergalin Pty Ltd; unreported; FCt SCt of WA; Library No 7675 Marsh & McLennan Pty Ltd v Stanyers Transport Pty Ltd [1994] 2 VR 232 McNally v Jackson (1938) 42 WALR 27 Morgan v Banning (1999) 20 WAR 474 Moscow Narodny Bank Limited v Mosbert Finance (Aust) Pty Ltd (1976) WAR 109 Unioil International Pty Ltd v Deloitte Touche Tohmatsu (No 2) (1997) 18 WAR 190 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
ROBERT CHARLES LUNDIE
JUDITH DIANNE LUNDIE
Defendants
Catchwords:
Summary judgment - Application by plaintiff and defendant - Turns on own facts
Legislation:
Corporations Act 2001 (Cth), s 479(3)
Property Law Act 1969 (WA), s 84
Rules of the Supreme Court 1971 (WA), O 16
(Page 2)
Result:
Application dismissed
Category: B
Representation:
Counsel:
Plaintiff : Mr G R Donaldson SC
Defendants : Mr J R Ludlow
Solicitors:
Plaintiff : Jackson McDonald
Defendants : Dibbs Barker Gosling
Case(s) referred to in judgment(s):
Australian Securities & Investments Commission v Rowena Nominees Pty Ltd [2003] WASC 106
Case(s) also cited:
Archer v Channel Seven Perth Pty Ltd [2001] WASC 195
Burton v The President of the Shire of Bairnsdale (1908) 7 CLR 76
Cameron v Troy & Co [2001] WASCA 400
Deputy Commissioner of Taxation v Robinswood Pty Ltd BC 200104403
Equiscorp Pty Ltd v Glengallon Investments Pty Ltd [2004] HCA 55
Evans v Bartlam [1937] AC 473
Fancourt v Mercantile Credits Limited (1983) 154 CLR 87
Forsayth NL v Northern Gold NL, unreported; FCt SCt of WA; Library No 940012; 20 January 1994
Gibbons v Wright (1954) 91 CLR 423
Jacob v Booths Distillery Co (1901) 85 LT 262
Knight v FP Special Assets Ltd (1992) 174 CLR 178
Lewkowski v Bergalin Pty Ltd; unreported; FCt SCt of WA; Library No 7675
Marsh & McLennan Pty Ltd v Stanyers Transport Pty Ltd [1994] 2 VR 232
(Page 3)
McNally v Jackson (1938) 42 WALR 27
Morgan v Banning (1999) 20 WAR 474
Moscow Narodny Bank Limited v Mosbert Finance (Aust) Pty Ltd (1976) WAR 109
Unioil International Pty Ltd v Deloitte Touche Tohmatsu (No 2) (1997) 18 WAR 190
(Page 4)
1 MASTER SANDERSON: This is the return of two chamber summonses. The first in time is the defendants' chamber summons seeking summary judgment under O 16 of the Rules of the Supreme Court 1971 (WA). In the alternative, the defendant seeks to have the matter proceed to trial without pleadings. Further in the alternative, the defendants seek security for their costs. The second chamber summons was issued by the plaintiffs. They seek leave to bring an application for summary judgment under O 14 - the application being well out of time under the Rules - and if leave be granted, judgment is sought on the claim. By agreement between the parties the two summary judgment applications were heard together. The question of whether, if the action remained on foot, it should proceed without pleadings and the question of security for costs, was stood over to a later date.
2 Before dealing with the facts in this case it is appropriate to refer to the decision of Pullin J (as his Honour then was) in Australian Securities & Investments Commission v Rowena Nominees Pty Ltd [2003] WASC 106. In that case Mr Conlan, as liquidator of Rowena Nominees Pty Ltd, sought and obtained an order that:
"The liquidator of the Respondent would be justified in causing the Respondent ('Rowena') to issue demands for the repayment of, and to institute proceedings to recover, funds advanced by Rowena as loans to the people listed in Schedule A ('the growers')."
3 To understand the background to that application it is necessary to understand the background facts as set out in his Honour's judgment. Insofar as it is necessary to do so, I would respectfully incorporate those background facts in these reasons without repetition.
4 It is important to note that the decision of Pullin J in Australian Securities & Investments Commission v Rowena Nominees Pty Ltd (supra) did not determine any of the issues live in these proceedings. Mr Conlan's application was for directions under s 479(3) of the Corporations Act 2001 (Cth). In his reasons, his Honour specifically notes that the success or otherwise of any action taken by Mr Conlan to recover loan funds will depend upon the facts of each particular case. However, a reading of his Honour's decision does make it clear why this action is brought in the name of the present plaintiff.
5 I have determined that both applications for summary judgment should be dismissed. That means that the action will proceed to trial. It is
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- therefore inappropriate that I say too much about the respective positions of the parties. However, as the matter was fully argued, I should briefly explain why I have dismissed each application.
6 The plaintiff pleads its cause of action in the following way. By par 1 it is pleaded that at all material times the plaintiff (referred to in the pleading as "Rowena") was a duly incorporated company which is now in liquidation. It is said that between 8 May 1996 and 31 May 1999 Rowena was a licensed finance broker. It carried on business under the name of "Graeme Grubb Finance Broker". It is said that it was a trustee of money received by it in the course of its business as a finance broker.
7 By par 2 it is said that by a prospectus dated 23 March 1998 issued by Karrioak Ltd ("the Manager"), an opportunity was offered to investors - defined in the pleading as "the growers" to participate in the establishment of the Karrioak Vineyard in the Mt Barker region. It is then pleaded in par 3 that the Karrioak Prospectus ("the prospectus") provided for each grower entering into a lease and management agreement regulating the lease of a particular area, the establishment of a vineyard on that area, the growing and harvesting of grapes for four years and participation in the distribution of the proceeds of sale of the grapes and related products. It is also pleaded that the prospectus offered the growers the opportunity to finance their investment in the project with a loan upon terms and conditions set out in the prospectus. In fact, it is pleaded in par 3.2 that the loan offered to growers was "from the plaintiff". In fact that does not appear to be quite accurate and it is a matter central to the defendants' defence. I will return to that issue later in these reasons.
8 By par 4 Rowena pleads that by written application dated 9 June 1998 the defendants applied for four leased areas pursuant to the terms of the prospectus. They also applied for loans to finance their contribution. It is said (by par 4.2) that the defendants "applied to the plaintiff for a loan". Once again, that appears not to be correct. By par 5 it is pleaded that on or about 30 June 1998 the defendants became registered as a grower. It is pleaded that the plaintiff advanced $100,000 to the Manager pursuant to the terms of the loan agreement. Thereafter it is said the defendants acquired an interest in the Karrioak project.
9 Paragraph 6 pleads the terms of the loan agreement. It is unnecessary for me at this stage to detail the terms of that agreement. It is sufficient if I say that pursuant to the agreement the defendants were due to make certain payments with respect to the loan on certain nominated dates. It is alleged by Rowena that the defendants have defaulted on these
(Page 6)
- obligations and Rowena now says that it is entitled to make demand for the amount of principal, plus the outstanding interest.
10 Essentially it is the defendants' position that Rowena is not the lender under the loan agreement. That being so, Rowena has no right to obtain repayment of the loan funds. To explain this position a little more fully it is necessary to look at the prospectus and the associated documentation. A copy of the prospectus appears as annexure "MAC3" to the affidavit of Mark Anthony Conlan, sworn 27 January 2005. The prospectus refers to the loan facility and provides what is described as a "summary of loan agreement". Under that section of the prospectus there is a subheading "Parties". Under that subheading there appears the following:
"Upon acceptance by the Manager of an application to enter into a Lease and Management Agreement for the leased area and a loan from the Lender, a Loan Agreement in all material respects in the form included in this prospectus will be entered into.
Each Loan Agreement will be executed by the Manager as attorney for and on behalf of the grower and any guarantor (if required) pursuant to the Power of Attorney forming part of the application under this prospectus and shall be executed by the finance broker Rowena Nominees Pty Ltd as Attorney for each Lender." (My underlining)
11 The defendants say that this provision in the loan agreement makes it plain that whoever the lender might be, it was not Rowena. The most that could be said so far as Rowena is concerned, is that they are an attorney for, or an agent for, the third party lender. In either case it is said, it is not open to Rowena to bring proceedings in its own name to recover the loan amount.
12 In support of this argument counsel referred to s 84 of the Property Law Act 1969 (WA). That section is in the following terms:
"84. Execution by attorney in his own name
(1) The donee of a power of attorney may execute or do any assurance, instrument, or thing in and with his own name and signature and his own seal (where sealing is required) by the authority of the donor of the power.
(Page 7)
- (2) Every assurance, instrument and thing so executed and done shall be as effectual in law to all intents as if it had been executed or done by the donee of the power in the name and with the signature and seal of the donor thereof.
(3) This section applies to powers of attorney created by instruments executed either before or after the coming into operation of this Act."
13 Counsel submitted that the effect of s 84 was that the demand issued by Rowena was effectively issued on behalf of the lender. Properly considered, it was not a demand issued by Rowena. Therefore, it was said, apart from anything else there was no proper demand by Rowena for repayment of the loan funds and the claim must fail.
14 In my view, the defendants' position, so far as the proper plaintiff is concerned, is arguable. That being so, the plaintiff's application for summary judgment must fail. There is clearly a serious question to be tried as to whether or not Rowena is the proper plaintiff in these proceedings. The remaining question is whether the defendants' case is unanswerable so that judgment ought be entered under O 16.
15 I am not satisfied that there is no answer to Rowena's defence to these proceedings. It is by no means clear on the present state of the evidence where the funds loaned to the defendants came from. They may have come from third party lenders, they may have come from Rowena, or it may not be possible to ascertain precisely where they came from. But this issue of fact needs to be explored. For instance, were it to be found that the funds came from trust moneys held by Rowena in circumstances where the beneficial owner of the funds was unaware they were being used to loan to persons such as the defendants, then Rowena may have a right, and indeed a duty, to recover those funds. But until the factual background is determined it is not possible, in my view, to say that Rowena does not have an arguable case to recover funds from the defendants.
16 For these reasons I would dismiss both summary judgment applications. I will hear the parties as to costs and as to further orders in relation to the defendants' remaining applications.
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