Thumbiran v Silver Chef Rentals Pty Ltd - [2021] NSWSC 1300

Supreme Court

New South Wales

Medium Neutral Citation: Thumbiran v Silver Chef Rentals Pty Ltd [2021] NSWSC 1300
Hearing dates: On the papers
Decision date: 13 October 2021
Jurisdiction: Equity - Commercial List
Before: Ball J
Decision:
(1) The proceeding be dismissed.
(2) The plaintiffs pay the defendants’ costs of the proceeding on an indemnity basis.

Catchwords:
CIVIL PROCEDURE — Pleadings — Fraud — Res judicata and issue estoppel — whether proceedings should be struck out under rule 14.28 of the Uniform Civil Procedure Rules 2005 (NSW) or dismissed as an abuse of process on the ground that they raise issues dealt with in prior proceedings

Legislation Cited:
Civil Procedure Act 2005 (NSW)
Real Property Act 1900 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:
Colgate Palmolive Co v Cussons Pty Limited (1993) 46 FCR 225
HIH Casualty and General Insurance v Chase Manhattan Bank [2003] 2 Lloyd’s Rep 61
Leichhardt Municipal Council v Green [2004] NSWCA 341
Silver Chef Rentals Pty Ltd v Thumbiran [2020] NSWSC 605
Takhar v Gracefield Developments Limited [2019] UKSC 13
Wentworth v Rogers (No 5) (1986) 6 NSWLR 534

Category: Procedural rulings
Parties: Trevelyn Thumbiran (First Plaintiff)
Absolute Pump Services Pty Ltd (Second Plaintiff)
Silver Chef Rentals Pty Ltd (First Defendant)
Donny’s Pizzeria Pty Ltd (Second Defendant)
Antonio Andrea Telese (Third Defendant)
Representation:
Counsel:
G Lucarelli (Plaintiffs)
J Baird (First Defendant)
Solicitors:
City Legal (Plaintiffs)
SLF Lawyers (First Defendant)
Mathas Law (Second & Third Defendants)

File Number(s): 2021/217789

Judgment

By a notice of motion filed on 23 August 2021, the first defendant, Silver Chef Rentals Pty Ltd (SCR), seeks an order that this proceeding be struck out under r 14.28 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) or be dismissed as an abuse of process. UCPR r 14.28 gives the Court power to strike out a pleading that (a) discloses no reasonable cause of action, (b) has a tendency to cause prejudice, embarrassment or delay in the proceedings, or (c) is otherwise an abuse of the process of the court.
In order to understand the application, it is necessary to say something about the history of the dispute between the parties and the nature of the claim in this proceeding.
On or about 11 May 2018, SCR entered into two equipment rental agreements with Donny’s Pizzeria Pty Ltd, the second defendant. Donny’s Pizzeria’s obligations under the agreements were guaranteed by the third defendant, Mr Antonio Telese, and the second plaintiff, Absolute Pump Services Pty Ltd (APS). It appears that APS is controlled by the first plaintiff, Mr Trevelyn Thumbiran, and that through that company Mr Thumbiran held a 25 percent interest in Donny’s Pizzeria at the time the rental agreements were signed.
SCR also claims that Mr Thumbiran personally guaranteed Donny’s Pizzeria’s obligations under the rental agreements pursuant to a letter agreement between them and that he gave security for that guarantee. Relevantly, the security consisted of charges over Mr Thumbiran’s interest in a number…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2021] NSWSC 1300
Decision Date: 13 October 2021

CaseChat Overview and Summary

In the matter of Thumbiran versus Silver Chef Rentals Pty Ltd, the plaintiff sought damages for alleged fraudulent misrepresentation in a business transaction. The case was heard in the Supreme Court of New South Wales. The plaintiff claimed that the defendant had made false representations regarding the profitability of a food service business, leading to the plaintiff entering into a lease agreement that was ultimately detrimental to his financial interests. The defendant, on the other hand, argued that the plaintiff's claims were precluded by prior proceedings and that the current litigation amounted to an abuse of process.

The legal issues before the court encompassed the applicability of res judicata and issue estoppel to the plaintiff's claims. Specifically, the court had to determine whether the plaintiff's claims were substantially the same as those raised in previous litigation and whether pursuing them now would constitute an abuse of the judicial process. Additionally, the court needed to assess whether the plaintiff's case should be struck out under the Uniform Civil Procedure Rules 2005 (NSW) due to the presence of fraud allegations.

In its judgment, the court held that the plaintiff's claims were indeed precluded by prior proceedings. It found that the issues raised in the current litigation were substantially the same as those adjudicated upon in the previous case, thus satisfying the criteria for res judicata. The court also concluded that the plaintiff's attempt to re-litigate these issues constituted an abuse of process. Consequently, the court ordered the proceedings to be dismissed. The court further found that the fraud allegations did not provide a basis to deviate from the application of res judicata and issue estoppel. The dismissal was final and without leave to amend or re-file.

Orders