Savannah v Cormick and Ors

[2001] VSC 456

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

PRACTICE COURT

No. 8292 of 2001

LINDSAY LOUIS SAVANNAH	Plaintiff
v.
ANTHONY WILLIAM CORMICK AND OTHERS	Defendants

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JUDGE:	BEACH, J
WHERE HELD:	MELBOURNE
DATE OF HEARING:	20 NOVEMBER 2001
DATE OF JUDGMENT:	20 NOVEMBER 2001
CASE MAY BE CITED AS:	SAVANNAH v. CORMICK & ORS.
MEDIUM NEUTRAL CITATION:	[2001] VSC 456

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CATCHWORDS:      Interlocutory injunction – Damages adequate compensation – Balance of convenience against grant of injunctive relief.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr. M. Mulvany	Bullards
For the Defendants	Mr. N. Wallace	Rosendorff Lawyers

HIS HONOUR:

1. This is the return of a summons filed in the court by the plaintiff on 13 November last whereby the plaintiff seeks certain interlocutory injunctive relief against the defendants.

1. The dispute between the parties arises from a partnership entered into by the plaintiff and the first and secondnamed defendants, initially discussed between the parties in about April 2000 and later evidenced by a partnership agreement executed by the plaintiff and the first and second defendants on or about 23 February 2001.

1. The first and second defendants are described in the partnership agreement as the senior partners;  the plaintiff is described as the junior partner. 

1. The partnership was established for the purpose of manufacturing, importing and selling Digital Set Top Boxes (the boxes) for use with television sets. 

1. The capital for the partnership was to be provided by the first and second defendants.  The plaintiff alleges that he was to provide his technical know-how.

1. Pursuant to the agreement the plaintiff was to be paid an annual salary of $65,000. 

1. Disputes arose between the plaintiff and the first and second defendants as to the conduct of the partnership and as to the contribution the plaintiff should make to the partnership. 

1. The plaintiff alleges that on 1 October 2001 the second defendant told him that he was required to provide capital of $225,000 to the business of the partnership and that unless he did so he was out of the partnership. 

1. The affidavit material filed in the court by the parties is voluminous.  No useful purpose would be served by detailing it in my reasons for judgment even if I had the time available to me to do so. 

1. Suffice it to say that there is a direct conflict in the account of matters given by the plaintiff on the one hand and the second defendant on the other, a conflict which can only be resolved at the trial of the proceeding. 

1. I am quite satisfied that there are serious issues to be determined in the proceeding, not the least of them being the terms of the initial agreement entered into by the plaintiff and the first and second defendants, the true role played by the plaintiff in the affairs of the partnership and the circumstances leading to the request by the second defendant that the plaintiff provide capital of $225,000 to the partnership.  That much is conceded by counsel for the defendants. 

1. The matter for me to determine therefore is where the balance of convenience lies.  Having considered that aspect of the matter, it is my opinion that the balance of convenience weighs against the grant of injunctive relief.  I say that for the following reasons.

1.        The first and second defendants have already contributed approximately $343,000 to the operations of the International Division of the business.  Any injunction of the type sought by the plaintiff may well have a catastrophic effect on the business.  It would seriously restrict the day-to-day operations of the business and could well cause the financiers who are assisting the defendants to finance the business to withdraw or refuse funding. 

2.        If the plaintiff is successful in his claim, it is my opinion that he would be adequately compensated by an appropriate award of damages.  In that regard the defendants through their counsel have undertaken to the court that pending the trial of this proceeding or further order they will (a) provide monthly written reports to the plaintiff detailing all purchases and sales of the subject Set Top Boxes and (b) maintain proper financial and accounting records relating to all transactions involving the Set-Top Boxes.

1. It is clear on any view of the matter that the trial of this proceeding has a degree of urgency about it.  I propose therefore to make interlocutory orders designed to bring the matter for trial as soon as possible. 

1. I make the following orders in the proceeding:

1.The plaintiff's summons filed in the court on 13 November 2001 is dismissed.

2.That the defendants deliver their defences and counterclaims, if any, on or before 30 November 2001.

3.That the plaintiff deliver his reply and defences to counter claims, if any, on or before 14 December 2001.

4.That the parties mutually give discovery to each other on or before 31 January 2002.

5.I refer the proceeding to the Listing Master to enable a trial date to be fixed for it after 31 January 2002.

6.        I reserve to the parties liberty to apply.

7.        I reserve the costs of the application.

8.I direct that this order be prepared by the solicitors for the defendants and within seven days brought to me for authentication.

9.I direct that a copy of the order be served on the associate to the Listing Master within seven days of its authentication.

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