Sonrich Super Pty Ltd as trustee for the Richardson Superannuation Fund v Place

[2020] FCCA 3099

FEDERAL CIRCUIT COURT OF AUSTRALIA

SONRICH SUPER PTY LTD AS TRUSTEE FOR THE RICHARDSON SUPERANNUATION FUND v PLACE & ORS [2020] FCCA 3099

Catchwords:
CONSUMER LAW – application for summary judgment – breach of rental agreement – misleading and deceptive conduct – whether applicant suffered loss and damage – summary judgment entered in favour of the applicant.

Legislation:

Competition and Consumer Act 2010 (Cth), s 138A

Federal Circuit Court of Australia Act 1999 (Cth), s 171A

Cases cited:

Spencer v Commonwealth of Australia [2010] HCA 28

Webster v Lampard [1993] HCA 57

Applicant: SONRICH SUPER PTY LTD AS TRUSTEE FOR THE RICHARDSON SUPERANNUATION FUND

First Respondent: JOANNE THERESE PLACE

Second Respondent: WA CRUSHING SERVICES PTY LTD

Third Respondent: BENEDICT SCOTT DIAMOND

File Number: PEG 140 of 2020

Judgment of: Judge Street

Hearing date: 13 November 2020

Date of Last Submission: 13 November 2020

Delivered at: Sydney

Delivered on: 13 November 2020

REPRESENTATION

Solicitors for the Applicant: Mr A Rumsley
Commercial Disputes Lawyer

Solicitors for the Respondents: Ms K McNally
McNally & Co Pty Ltd

DECLARATIONS

1. The applicant is entitled to summary judgment under s 17A of the Federal Circuit Court of Australia Act 1999 (Cth) that the applicant is the owner of the Kue Ken 1105 Jaw Crusher (serial number) 118MO11 as against the respondents.

ORDERS:

1. Summary judgment under s 17A of the Federal Circuit Court of Australia Act 1999 (Cth) is entered in favour of the applicant as against the second respondent in an amount to be determined after taking into account the sale of the Kue Ken 1105 Jaw Crusher (serial number) 118MO11 by the applicant.

2. Summary judgment under s 17A of the Federal Circuit Court of Australia Act 1999 (Cth) is entered in favour of the applicant as against the first respondent and the third respondent in the sum of $100,000.00.

3. The first respondent and the third respondent pay the applicant interest at the applicable prejudgment rate as if r 39.06 of the Federal Court Rules 2011 (Cth) applied from 2 June 2017 to date.

4. The applicant file and serve an affidavit within 1 month after the sale of the Kue Ken 1105 Jaw Crusher (serial number) 118MO11 identifying the sale price and the net proceeds which the Court will take into account in determining the quantum of the summary judgement entered against the second respondent the subject of order 1 above.

5. Upon filing and serving the affidavit in order 4 above, the applicant should request in open correspondence relisting of the matter before the Court and the Court will then take steps to have the matter relisted for the purpose of quantifying the summary judgment entered against the second respondent the subject of order 1 above.

6. Costs are reserved in respect of the summary judgment application.

Date of orders: 13 November 2020

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

PEG 140 of 2020

SONRICH SUPER PTY LTD AS TRUSTEE FOR THE RICHARDSON SUPERANNUATION FUND

Applicant

And

JOANNE THERESE PLACE

First Respondent

WA CRUSHING SERVICES PTY LTD

Second Respondent

BENEDICT SCOTT DIAMOND

Third Respondent

REASONS FOR JUDGMENT

1. These are proceedings within the Court’s jurisdiction under s 138A of the Competition and Consumer Law Act 2010 (Cth) in which the applicant, being a corporate trustee of a superannuation trust, seeks to recover moneys advanced, on the face of the statement of claim, under an agreement between the applicant and the second respondent in respect of a Kue Ken 1105 Jaw Crusher (serial number) 118MO11 (“Crusher”). The applicant also pleads misleading and deceptive conduct by the first respondent, being a director of the second respondent corporate entity, and the third respondent, being the first respondent’s partner.

2. There has been an application filed for summary judgment by the applicant. The application for summary judgment is under s 17A of the Federal Circuit Court of Australia Act 1999 (Cth). The Court has taken into account the principles identified by the High Court of Australia in Spencer v Commonwealth of Australia [2010] HCA 28 in respect of the caution to be exercised in entering summary judgment, as well as the observations of the High Court of Australia in Webster v Lampard [1993] HCA 57.

3. The applicant has put into evidence an agreement which has a schedule that clearly identifies the parties to the agreement being the applicant and the second respondent. The agreement identifies an obligation for repayment by the second respondent of $100,000 and a further series of payments totalling $15,000.

4. Under the agreement, it is apparent that the applicant is the owner of the Crusher. The payments under that agreement that were intended by the second respondent have never been made.

5. The respondents have put on a defence seeking to take issue with the allegations of breach of contract and misleading and deceptive conduct.

6. The Court’s attention has been drawn to the other corporate entities that appear on the face of the hire agreement. Given the surrounding circumstances in which it is apparent that the payment of $100,000 was made by the applicant to the second respondent on 2 June 2017, the Court is satisfied that there is no reasonable argument other than that the party to the agreement is the second respondent. Further, it is apparent that the second respondent has failed to repay that amount.

7. The respondents submitted that there was a loan transaction between individuals having a relationship to the superannuation trust by reason of which it was alleged that there had been a payment of $50,000 that should be brought to account. On no view was that a payment of $50,000 to the applicant. Further, as the solicitor for the applicant has pointed out, that purports to be a loan transaction and does not give rise to any basis to reduce the amount currently sought to be recovered by the applicant in contract, which is the $100,000 plus the $15,000.

8. The applicant is entitled to a declaration as between the parties to the proceedings that it is the owner of the Crusher and, as against the second respondent, is entitled to summary judgment in an amount to be determined following the sale of the Crusher.

9. So far as the case concerns misleading and deceptive conduct, the statement of claim advances an allegation of misleading conduct in paragraph 14 that the second respondent was able to comply with its obligations under the agreement and was able to make the payment of rent and would continue to make payments under the agreement.

10. The Court’s attention has been drawn to the communications that suggest the agreement came into formal execution after the payment was made on 2 June 2017. The Court is satisfied, however, that it is patent that a representation was made to the effect of paragraph 14 of the statement of claim that the second respondent was able to repay its obligations under the agreement. It is also patent, given the invoice that was issued, that the first respondent was a party to that representation. That representation was clearly misleading in the circumstances where no such payments or repayments have been made.

11. It is also apparent from the evidence including the affidavit of the third respondent, that, although a bankrupt, he was a party to and engaged in the making of that representation. The third respondent was also a person who purported to sign the agreement on behalf of the second respondent.

12. There is no evidence to support the assertion that the third respondent did not have authority to execute the agreement on behalf of the second respondent. Notwithstanding the fact that the third respondent was a director, that does not mean that he did not purport to exercise such authority and the conduct of the second respondent is consistent with the ratification of that authority.

13. There is no reasonably arguable defence in respect of the misleading and deceptive conduct case advanced by the applicant against the respondents. The Court is satisfied that, by reason of that misleading and deceptive conduct by the respondents, the applicant suffered loss and damage.

14. The respondents submitted that the representation was not made in trade and commerce because it was not the case that the second respondent engaged in the business of financing or hiring machines. That submissions entirely fails to understand the breadth of the meaning of “trade and commerce”. There is no arguable case that the representation and the misleading conduct did not occur in trade and commerce.

15. The Court finds that, by reason of the misleading conduct by the first respondent and the third respondent, the applicant suffered a loss by reason of the payment of the $100,000 on 2 June 2017 and that the applicant is entitled to summary judgment against the first and third respondents in the sum of $100,000, together with interest to be paid from 2 June 2017.

I certify that the preceding fifteen (15) paragraphs are a true copy of the transcript of the published oral reasons for judgment of Judge Street delivered in open Court on 13 November 2020 and the parties were sent a sealed copy of the Court’s orders.

Associate:

Date: 10 December 2020