Stanberg Pty Ltd v Tabibi

Case [2012] SASC 187

SUPREME COURT OF SOUTH AUSTRALIA

(Appeal from a Master: Civil)

STANBERG PTY LTD v TABIBI

[2012] SASC 187

Judgment of The Honourable Justice Peek

18 October 2012

PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - JURISDICTION AND GENERALLY

PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - PROCEDURE UNDER RULES OF COURT - MASTERS

APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - RIGHT OF APPEAL - WHEN APPEAL LIES - FROM INTERLOCUTORY DECISIONS - LEAVE TO APPEAL

PROCEDURE - JUDGMENTS AND ORDERS - IN GENERAL - CLASSIFICATION - FINAL AND INTERLOCUTORY

Appeal from a Master of the Supreme Court - the plaintiff/appellant operated a restaurant with the defendant/respondent under a written partnership agreement - after the breakdown of the partnership, the appellant surcharged the draft accounts to claim a debit against the respondent of $45,848.00 - it was alleged that the respondent had misappropriated this amount from the takings of the partnership - the defendant disputed this surcharge - the Master rejected the appellant's claim after hearing detailed evidence from the parties.

Whether the reasons and orders of the Master constituted an interlocutory judgment against which the appellant had a right of appeal - whether a single Judge of the Supreme Court was the correct forum for hearing the appeal - whether leave to appeal was required.

Held: The reasons and orders of the Master constituted an interlocutory "judgment" within the meaning of ss 50(1) and (2), Supreme Court Act 1935 (SA) - the Master in delivering the orders and reasons had performed a judicial act which decided a question raised for decision in the proceedings - the matter of the surcharge was only one aspect of the proceedings before the Master, the principal cause being the overall partnership dispute, and therefore the judgment was interlocutory in nature - leave to appeal to the single Judge is not required.

EVIDENCE - BURDEN OF PROOF, PRESUMPTIONS, AND WEIGHT AND SUFFICIENCY OF EVIDENCE - GENERALLY - SUFFICIENCY

EVIDENCE - BURDEN OF PROOF, PRESUMPTIONS, AND WEIGHT AND SUFFICIENCY OF EVIDENCE - GENERALLY - ONUS OF PROOF - GENERAL RULE

Whether the decision of the Master rejecting the appellant’s claim was contrary to the evidence and/or the Master failed to properly consider relevant matters - whether the Master should have found that the respondent had misappropriated particular amounts of money and awarded the appellant the total of those amounts - whether the Master failed to properly approach, or apply, the correct onus or standard of proof - whether the Master should have found that the respondent had misappropriated some amounts of money and made a general award of damages in favour of the appellant.

Held: Appeal dismissed - the Master's finding that it was not established that the respondent had misappropriated the amount of the surcharge was correct - it was not established that the Master failed to appreciate, understand or have proper regard to the matters referred to by the appellant - the Master did not err in finding that…

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Stanberg Pty Ltd v Tabibi [2012] SASC 187
Case
[2012] SASC 187
Decision Date

CaseChat Overview and Summary

In the matter of Stanberg Pty Ltd v Tabibi, the appellant, Stanberg Pty Ltd, a company that operated a restaurant with the respondent, Tabibi, under a partnership agreement, sought to surcharge the draft accounts to claim a debit of $45,848.00 against the respondent, alleging misappropriation from the partnership's takings. The respondent disputed this claim, and the case was heard by a Master of the Supreme Court of South Australia, who rejected the appellant's claim. The appellant appealed this decision to a single Judge of the Supreme Court, challenging both the interlocutory nature of the Master's judgment and the correctness of the Master's findings.

The court examined whether the Master's reasons and orders constituted an interlocutory judgment, which would allow for an appeal, and if so, whether leave to appeal was necessary. The court determined that the Master's judgment was indeed interlocutory as it pertained to only one aspect of the broader partnership dispute. Consequently, the appeal was deemed permissible without the requirement for leave. The court further assessed the Master's decision on the evidence presented, particularly whether the Master erred in not finding that the respondent had misappropriated funds, and whether the Master applied the correct standard of proof. The court found that the Master's decision was not contrary to the evidence and that the Master had correctly applied the necessary standard of proof, which did not mandate a finding of misappropriation on a balance of probabilities.

The appeal was ultimately dismissed. The court upheld the Master's findings, confirming that there was insufficient evidence to establish that the respondent misappropriated any part of the alleged amount. The Master's approach to the burden of proof was also deemed appropriate, as the court found that the Master did not err in declining to award damages to the appellant. The decision underscores the importance of clear and cogent proof in matters of misappropriation, and the court's affirmation of the Master's findings signifies that the respondent's actions did not meet the required standard of proof. The court's ruling also clarified the procedural aspects of appeals from Masters' decisions, emphasizing the interlocutory nature of certain judgments and the conditions under which such appeals may proceed.

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

PEEK J
In a passage which is of great assistance as to the common law meaning of “judgment”, King CJ stated in Legal Practitioners Complaints Committee v A Practitioner:[1]A judgment or order is a judicial act which decides the question or one of the questions which is raised for decision in the particular proceedings then before the court or judge. The question decided may be the substantive question or one of the substantive questions raised in the action; or it may be the question or one of the questions raised in interlocutory proceedings taken in the course of the progress of the action. Judgments and orders on the one hand are to be distinguished from incidental rulings given in the course of hearing and determining such questions. Examples of such incidental rulings are those which relate to adjournments, the time and place of hearing, admissibility of evidence and the exclusion or otherwise of witnesses from the hearing, as well as decisions upon submissions as to matters of fact law or procedure made during the course of a hearing. Such incidental rulings are not judgments or orders and are therefore not appealable even by leave.Into which category does the learned judge’s decision as to the competency of the appeal, fall? In the generality of cases, a ruling that an appeal is competent or that the court or judge has jurisdiction to entertain the particular appeal or application before it, is an incidental ruling on a submission made in the course of the hearing and is not made the subject of a judgment or order. It is therefore not appealable. But it may be made the subject of a judgment or order. Whether that has occurred depends upon the treatment of the matter by the court or judge. In the present case, the learned judge expressly determined the question of competency as a preliminary point separate and distinct from the other issues which fell for determination on the appeal. His intention was to decide competency as a separate issue and to make his decision upon that issue the subject of a judgment or order. He emphasised that by giving leave to appeal and indicating that he was not seized of the appeal generally. The drawing up and sealing of the order on the basis of a certificate of the judge’s associate is not, of course, decisive, but it tends to confirm the status of the judge’s decision.(Emphasis added)[1] (1987) 46 SASR 126, 127-128. In my view, the Master here determined the matter of the surcharge as a preliminary or separate point in much the same way as occurred in Legal Practitioners Complaints Committee v A Practitioner.[2] The present matter involved:·the examination and cross-examination of a number of witnesses;·the receipt and consideration of a number of exhibits;·detailed consideration of opposing cases for the parties;·detailed findings of fact; ·findings of credibility;·the making of a decision in favour of the case for one party;·formulation of detailed reasons for that decision; and·the making of orders arising from the decision.[2] (1987) 46 SASR 126.

Ratio Decidendi

Legal Principle Established

Established by: PEEK J

It is therefore plain that his Honour was not satisfied that it was more likely than not that the defendant misappropriated funds from the appellant. Indeed, that is confirmed in the following paragraph [28] where his Honour considers the plaintiff’s submissions that a distinction could be drawn between groups of deletions in the “Exceptions Report” (the “bins” submission) and that the evidence established that the defendant must have misappropriated some particular amounts of money while only establishing that the defendant most likely misappropriated other sums. When his Honour states at paragraph [28] that “I do not accept these submissions”, his Honour clearly rejects both alternative submissions that the plaintiff had established either that the defendant “must have misappropriated them” or that he “most likely misappropriated them”. A consideration of authorities relevant to the appellant’s third contention As I understood counsel for the appellant, it was submitted that his Honour’s use of the word “likely” in paragraph [27][32] constituted a finding of “likelihood” which was in itself, or should have led to, a finding on the balance of probabilities that the defendant did in fact misappropriate unidentified parts of the $45,848.00.[32] Particularly in the passage, “[i]t is also likely that the defendant, possibly in concert with some employees, did misappropriate unidentified parts of the $45,848. However, there is also at least an equal reasonable possibility that some unidentified part of the $45,848 was misappropriated by a staff member without the involvement of the defendant”. I have endeavoured to explain why this is an incorrect construction of his Honour’s reasons taken as a whole and perhaps that is all that really needs to be said. However, the appellant’s assertion, vague as it is, that the Master “seems to have misapplied Briginshaw to somehow modify the standard of proof” makes some reference to the authorities appropriate.“Likely” and “more likely than not” The first rather obvious point to be taken from the authorities is that in normal parlance, and in the sense in which his Honour spoke in the present case, the word “likely” does not mean “more likely than not”. Rather, it simply means “a real or not remote chance or possibility”; any additional question of whether it is a likelihood of more or less than 50 per cent is a matter for further judgment in a particular case. Thus, in Sheen v Fields Pty Ltd,[33] legislation required that eye protection be provided where there was a “likelihood of injury” to the eyes of an employee and a question arose on the facts as to whether there was a “likelihood” of injury to the eyes of the appellant. Gibbs CJ stated:[34]In the Full Court it was held that “likelihood” in cl 21 means “something less than probability but more than a remote possibility”. I would accept that view. In other words, a likelihood is “a real or not remote chance or possibility regardless of whether it is less or more than 50 per cent”…[33] (1984) 51 ALR 345.[34] Ibid 348.