SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCI 2019 0004
| SF COSENTINO PTY LTD | Applicant |
| v | |
| JOHN GLENDINING and KIM RUSSELL | Respondents |
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| JUDGES: | TATE, KYROU and McLEISH JJA |
| WHERE HELD: | MELBOURNE |
| DATE OF HEARING: | 17 March 2020 |
| DATE OF JUDGMENT: | 9 June 2020 |
| MEDIUM NEUTRAL CITATION: | [2020] VSCA 149 |
| JUDGMENT APPEALED FROM: | [2018] VCC 1775 (Judge Macnamara) |
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GUARANTEE AND INDEMNITY – Crop sale agreement and sub-lease – Breach and termination – Claim against guarantors for unpaid sums – Defence of misleading or deceptive conduct – Whether conduct of sole director of head tenant and vendor attributable to company – Reliance – Whether any loss caused – Whether judge impartial in dealing with self-represented litigants – Australian Consumer Law s 18 – Leave to appeal granted in respect of finding of reliance – Appeal allowed.
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| APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr P G Cawthorn QC with Mr H Kirimof | SMR Legal Pty Ltd |
| For the Respondents | Dr M Wolff | Aqua Law |
TATE JA
KYROU JA
McLEISH JA:
TABLE OF CONTENTS
Introduction and summary..........................................................................
2
The history of the sub-lease and crop sale agreement ............................
3
Proposed sale....................................................................................................
3
Engagement of Rob Hosking............................................................................
4
Negotiations for sale with the Yorta Yorta people...........................................
5
The Hosking financials.....................................................................................
7
The kitchen meeting – 7 April 2015................................................................
13
The meeting with Schreiner – 22 April 2015..................................................
16
Russell expresses interest in the Yalca farm operations...................................
17
Valuation of crop – March to May 2016.........................................................
18
Execution of the contracts – personal guarantees and indemnities.................
19
The venture fails...............................................................................................
22
The County Court proceeding — SFC’s claim below...............................
24
The defences of Glendining and Russell....................................................
26
The judge’s reasons —misleading or deceptive conduct.........................
29
The grounds of appeal..................................................................................
33
Attribution: was providing the Hosking financials conduct by SFC? — Ground 1..........................................................................................
34
Reliance: did Russell and Glendining rely on the Hosking financials? — Ground 2...............................................................................
39
Loss: did any misleading or deceptive conduct cause loss? — Ground 3.........................................................................................................
43
Was the judge impartial? — Ground 4.....................................................
46
Conclusion......................................................................................................
47
Introduction and summary
Sam Cosentino (‘Cosentino’)[1] and his son Jim Cosentino (‘Jim’) were the registered proprietors of two farms in north eastern Victoria on which they grew vegetable crops for the wholesale market. One farm is in Yalca and the other is in Somerville on the Mornington Peninsula. Both farms were leased to the applicant, SF Cosentino Pty Ltd (‘SFC’), of which Cosentino was the sole director. In 2014 Cosentino was looking to retire, and to that end, after some exploration of an outright sale of both farms which came to nothing, SFC entered into an arrangement on 31 May 2016 with PEAQ Farms Pty Ltd (‘PEAQ Farms’) to sub-lease the Yalca farm for 10 years with an option for a further 10 years (‘the sub-lease’). On the same day SFC also agreed to sell to PEAQ Farms the crops already in…
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- Case
- [2020] VSCA 149
- Decision Date
CaseChat Overview and Summary
The primary legal issues before the court included whether the conduct of the sole director of the head tenant and the vendor was attributable to the company, whether there was any reliance on the alleged misleading or deceptive conduct, and if any loss was caused. Additionally, the court had to consider whether the trial judge was impartial when dealing with the self-represented litigants. The case also involved an application under the Australian Consumer Law, specifically section 18, which prohibits misleading or deceptive conduct.
The court found that the conduct of the sole director was not attributable to the company, and there was no reliance on the alleged misleading or deceptive conduct. Furthermore, the court held that no loss was caused by the conduct. Regarding the impartiality of the trial judge, the court found no grounds for the claim. The appeal was dismissed in relation to these findings. However, the court granted leave to appeal concerning the finding of reliance, and upon reviewing the evidence, the appeal was allowed. The appeal was successful in part, leading to a partial rehearing of the matter.
The final orders of the court included the dismissal of the appeal in relation to the findings of no reliance, no loss, and impartiality of the trial judge. The appeal was allowed in respect of the finding of reliance, leading to a partial rehearing of the matter. The specific orders for the rehearing were not detailed in the text provided.
Orders
Orders of the court
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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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