Stacey v Perkins

[2015] QDC 175

[2015] QDC 175

DISTRICT COURT OF QUEENSLAND

CIVIL JURISDICTION

JUDGE REID

No 3592 of 2014

PAUL DOUGLAS STACEY  Plaintiff

and

WILLIAM STEWART PERKINS and ANOTHER        Defendants

BRISBANE

10.58 AM, WEDNESDAY, 3 JUNE 2015

JUDGMENT

HIS HONOUR:   I have before me an application by the plaintiff for orders compelling the second defendant to perform disclosure in accordance with orders made by his Honour Judge Dorney QC on the 8^th of May and for consequential orders. 

The action by the plaintiff concerns a claimed entitlement to monies apparently on a commission basis associated with his involvement in the sale of shares by each of the first and second defendants to a third party.  On the 13^th of April 2015 the solicitors for the plaintiff wrote to the solicitors for the second defendant seeking, inter alia, disclosure of deeds, contracts, agreements, bank statements, receipts and financial statements for Smyth and Perkins Pty Ltd and Shamir Australia Pty Ltd and all other documents evidencing the consideration received from Shamir, Israel.

The letter referred to the share purchase agreement of the 1^st of August 2014 and in particular the provisions for deferred payment in respect of that consideration.  The parties agree that that deferred payment is dependent upon a somewhat complicated formula which, among other things, depends upon the financial performance of the companies I’ve referred to.  It seems to me in such circumstances that the bank statements, receipts and financial statements sought by the plaintiff are clearly relevant. 

For reasons set out in his detailed judgment of the 8^th of May 2015, his Honour Judge Dorney QC ordered: 

1. the plaintiff have leave to amend its claim and statement of claim as advised and file the same within 14 days of this order;

2. all amendments are to take effect on and from the 8^th of May 2015;

3. the second defendant give disclosure to the plaintiff pursuant to his duty to do so, pursuant to r 211 of the UCPR within seven days of this order;

4. His Honour also made orders in respect of further applications in respect of costs. 

Subsequent to that order, this application was brought on the 27^th of April because of alleged non-compliance by the second defendant with its obligation to disclose.  As a result of submissions made and discussion with counsel, I have come to the strong view that the approach of the second defendant to disclosure is entirely inadequate.  In particular, an affidavit of the second defendant sworn the 27^th of February 2015 appears on its face to consider only disclosure of documents associated with the negotiation and the agreement itself. 

The second defendant discloses that he maintain a spring back folder of all documents involved in negotiations and the agreement since 2008 but that since he moved residence in November 2013 he’s been unable to locate the spring back folder despite “turning my house upside down”.  Nowhere in the affidavit does he appear to address the further issue relating to the financial statements of he and the company which might be relevant to an assessment of that consideration and which might evidence payments made to him or to his former wife. 

In my opinion, it is also true that despite a request by the Plaintiff, the second defendant has not provided a list of documents, but merely asserts in affidavits and in letters that documents that had been provided. This includes a document headed “Shareholders’ Rights Agreement” which is undated and unsigned but which he says is “to my memory, exactly like the original document” and is all that he needed to disclose.  In my view, that’s clearly not the case and is an abdication of his obligation pursuant to the order of Judge Dorney. The documents requested in the letter of the 13^th of April clearly indicate that the documents that were ordered to be disclosed are significantly more extensive than those referred to in that short affidavit of the 27^th of February. 

I am sure that if his solicitor carefully explains to the second defendant the nature of the obligation in respect of disclosure that the second defendant will immediately see that there are other documents in his possession or under his control which ought be disclosed. It’s clear, in my view, that he ought provide a list of documents to the plaintiff in accordance with the order of Judge Dorney. 

In the circumstances I think it appropriate to make an order as per the draft which I have initialled.  In view of the fact that his Honour made those orders on the 8^th of May and that the second defendant failed to comply with those orders necessitating the bringing of this further application and in circumstances where the nature of disclosure was clearly identified by the plaintiff’s solicitors as early as the 13^th of April 2015 in the letter to which I have referred, I think it appropriate that an order be made with respect to costs on an indemnity basis. Accordingly, I’ve made an order as per draft, initialled by me and placed with the papers. 

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