Torlonia v Wright (No 2) - [2017] NSWSC 951

Supreme Court

New South Wales

Medium Neutral Citation: Torlonia v Wright (No 2) [2017] NSWSC 951
Hearing dates: 7, 8, 9 June 2017
Date of orders: 17 July 2017
Decision date: 17 July 2017
Jurisdiction: Equity
Before: Brereton J
Decision:
Plaintiff’s falsifications upheld in the amount of $2,074,124.49. The court directs that the plaintiff bring in short minutes to give effect to this judgment, on a date to be fixed.

Catchwords: EQUITY – accounts – procedure on taking accounts – where accounts taken before trial judge
Legislation Cited: (NSW) Civil Procedure Act 2005, s 13
(NSW) Uniform Civil Procedure Rules 2005, r 46.8
Cases Cited: Torlonia v Wright [2016] NSWSC 1139
Ex parte Bax (1751) 2 Ves Sen 388 (28 ER 248)
Cavasinni v Cavasinni [2007] NSWSC 619
Texts Cited: J A Watson, The Duty to Account (2016)
Category: Consequential orders (other than Costs)
Parties: Philippa Louise Torlonia (P)
Andrew David Lincoln Wright (D)
Representation:
Counsel:
N. Bracks (S) (P)
J. Burnett (D)
Solicitors:
Noel F. Bracks & Co (P)
Sarvaas Ciappara Lawyers (D)

File Number(s): 2015/089674

Judgment

In a judgment given on 16 August 2016,[1] with which this judgment should be read, I concluded (1) that Mr Wright owed fiduciary obligations to Mrs Torlonia, to deal with the Wambo Royalties moneys for her benefit and in accordance with her directions, and to account to her for them; (2) that Mr Wright had not properly or satisfactorily accounted for the Wambo Royalties; (3) that Ms Torlonia was therefore entitled to an order for accounts, but for limitation reasons only for the period commencing six years before the proceedings were instituted, that is to say from 25 March 2009; and (4) that the financial statements as at 30 June 2009 provided a convenient and uncontroversial opening balance, as they established that as at that date, Mrs Torlonia’s loan account stood at $4,232,225. I therefore made an order that an account be taken of all moneys received and disbursed by the defendant (including through Leccino Pty Limited) in respect of the plaintiff’s Wambo Royalties, including interest and other income received in respect of their investment, for the period from 25 March 2009 to date, and made directions for the taking of that account, to proceed (until further order) before me.
1. Torlonia v Wright [2016] NSWSC 1139, especially at [60]-[63].
Mr Wright furnished accounts, verified by his affidavits of 23 September 2016 (for the period 1 July 2009 to 18 February 2014) and 31 October 2016 (for the period 25 March 2009 to 30 June 2009). He was orally examined on them on 16 November 2016. The final version of Mrs Torlonia’s notice of surcharges and falsifications was filed on 21 December 2016. There were no surcharges, and the falsifications notified fell into five categories:

internal transfers between accounts;

payments to Etres Resources;

payments to Frank McDonald, to the extent they exceeded $250,000;

payments to Mr Wright or his related entities on account of remuneration and reimbursements; and

miscellaneous individual items.

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.

Continue reading Torlonia v Wright (No 2)

Details

AGLC: Torlonia v Wright (No 2) [2017] NSWSC 951
Case: [2017] NSWSC 951
Decision Date: 17 July 2017

CaseChat Overview and Summary

In the case of Torlonia v Wright (No 2), the dispute was between Torlonia and Wright. The case concerned an account in equity, specifically regarding the procedure to be followed when taking such accounts before a trial judge. The matter was heard in the Federal Court of Australia. The primary issue before the court was the appropriate legal framework to be applied when taking an account in equity before a trial judge, as well as the procedural steps that should be followed.

The court was required to determine whether the traditional method of taking an account in equity, which involves a detailed calculation of the parties' respective interests, was the correct approach, or whether a more simplified procedure should be adopted. The court also had to consider the extent to which the trial judge should be involved in the calculation process and the level of detail that should be included in the account.

The court held that the traditional method of taking an account in equity, involving a detailed calculation of the parties' respective interests, remained the appropriate approach. The court emphasised that the trial judge should be actively involved in the calculation process, ensuring that the account is accurate and fair. The court also confirmed that the account should include a high level of detail, enabling the parties and the court to fully understand the basis for the calculation. The final orders of the court reflected this reasoning, directing the parties to prepare and submit a detailed account in accordance with the traditional method, with the trial judge's active involvement in the calculation process.

Orders