Touch for Health Pty Ltd as Trustee for Knight Superannuation Fund v The Property Mentors Australia Pty Ltd
[2022] FCA 77
•7 February 2022
FEDERAL COURT OF AUSTRALIA
Touch for Health Pty Ltd as Trustee for Knight Superannuation Fund v The Property Mentors Australia Pty Ltd [2022] FCA 77
File number: VID 301 of 2021 Judgment of: SNADEN J Date of judgment: 7 February 2022 Catchwords: PRACTICE AND PROCEDURE – concise statements – orders made that the matter proceed by concise statement – respondents contend that the applicant’s concise statement lacks sufficient clarity to enable them to understand the case that they must meet at trial – whether the matter should proceed by way of concise statement or formal pleadings – appropriate to proceed by way of concise statement – applicants granted leave to amend concise statement Legislation: Australian Securities and Investments Commission Act 2001 (Cth) Division: General Division Registry: Victoria National Practice Area: Commercial and Corporations Sub-area: Regulator and Consumer Protection Number of paragraphs: 11 Date of hearing: 7 February 2022 Counsel for the Applicants: Mr S Rubenstein Solicitor for the Applicants: DSA Law Counsel for the First and Third Respondents: Mr D Harrison Solicitor for the First and Third Respondents: Patrick & Associates Counsel for the Second Respondent: Ms A Caruthers Solicitor for the Second Respondent: Pearce Webster Dugdales Counsel for the Fourth Respondent: The Fourth Respondent did not appear ORDERS
VID 301 of 2021 BETWEEN: TOUCH FOR HEALTH PTY LTD AS TRUSTEE FOR KNIGHT SUPERANNUATION FUND
First Applicant
BRIAN KNIGHT
Second Applicant
CLAIRE KNIGHT (and others named in the Schedule)
Third Applicant
AND: THE PROPERTY MENTORS AUSTRALIA PTY LTD
First Respondent
MATTHEW BATEMAN
Second Respondent
LUKE HARRIS (and others named in the Schedule)
Third Respondent
ORDER MADE BY:
SNADEN J
DATE OF ORDER:
7 FEBRUARY 2022
THE COURT ORDERS THAT:
1.The applicants have leave to file an amended concise statement by no later than 4:00pm on Monday, 28 February 2022.
2.The respondents file and serve concise responses or, in the case of the second respondent, an amended concise response to, the applicants’ amended concise statement by no later than 4:00pm on Monday, 21 March 2022.
3.The respondents file and serve any application or applications to bring any cross-claim for contribution or indemnity by 4:00pm on Monday, 21 March 2022.
4.The proceeding be listed for further case management on a date to be advised.
5.Costs be reserved.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
SNADEN J:
The first to third respondents move the court for orders that the present matter proceed upon pleadings, rather than upon concise statements, as is presently envisaged. The matter concerns claims relating to a failed property investment scheme, the details of which needn’t here be rehearsed. The respondents (including the fourth respondent) are said to have engaged, in relation to that scheme, in conduct that was negligent, misleading or deceptive, and contrary to certain requirements of the Australian Securities and Investments Commission Act 2001 (Cth). The applicants seek to recover the $500,000.00 that they invested in the scheme, together with other ancillary relief.
The issue of pleadings arose for debate at a case management hearing conducted on Monday, 7 February 2022. At the conclusion of that hearing, the court made various orders and undertook to publish brief reasons in relation to them. These reasons discharge that promise. It should be noted that the fourth respondent has not filed an appearance and is yet to assume any role in the litigation. That being so, references hereafter to “the respondents” should be understood as references to the first, second and third respondents.
Central to the respondents’ present claim for pleadings is the notion that the applicants’ concise statement of 3 June 2021 (hereafter, the “Concise Statement”) fails to advance claims against them in terms that are sufficiently clear. By their brief written submissions in favour of the matter progressing upon pleadings, the respondents identified a number of respects in which they claim that matters are alleged against them without appropriate clarity. It is convenient to address each in turn.
First, it is said that the applicants’ Concise Statement alleges that the first respondent offered to provide certain services to the applicants but does not identify how or by whom that offer was made. I reject the respondents’ criticisms. The matters alleged are sufficiently addressed in the Concise Statement. No doubt they will be elaborated upon in the evidence. There is no prospect that anybody might be taken by surprise once the matter progresses to trial.
Second, it is said that the Concise Statement alleges that the respondents recommended that the applicants commit to certain investments but does not identify how those recommendations were made (including whether they were made by each of the respondents separately or together). Again, I reject that criticism. The allegation is sufficiently clear and the prospect that any of the respondents might genuinely be prejudiced at the trial is remote, to say the least.
Third, it is said that the Concise Statement impermissibly conflates the publishing of certain information by the first respondent with conduct of the second and third respondents. The respondents complain that they cannot understand how it will be put that that information amounted to conduct alleged as against each of the second and third respondents. There is substance to this complaint; but not to a point that the matter can’t fairly proceed without formalised pleadings. It is clear enough that the applicants allege that the representations contained within the publication referred to (or that arise from it) are representations that should be understood to have been made not merely by the first respondent but by the other respondents as well. That, though, is a conclusion that rests upon the establishment of other facts to which the Concise Statement makes no reference (for example, it might be—as the court was told—that the published information was sent to them by one or both of the second and third respondents, or that they otherwise each engaged in some kind of marketing activity to that end). Although the deficiency should be corrected, it is not a matter that warrants an order for more formalised pleadings. It can (and should) be addressed just as easily within an amended concise statement.
At this point, I might pause to note a matter that counsel for the applicants stressed at the hearing of 7 February 2022: namely, that the representations upon which the applicants claim to have relied (and in respect of which the claims of statutory misfeasance are put) all arise on the strength of documents with which the applicants were provided. That is not a reality that emerges as clearly from the Concise Statement as it could.
Fourth, the respondents complain that the Concise Statement does not identify how the representations upon which the applicants claim to have relied arose from the conduct that is alleged against them. Again, that is not a matter that warrants pleadings. If the facts said to have given rise to the representations that are in issue did not, in truth, do so, then the claims advanced against the respondents in that regard will fail. That is not reason in itself to order that the matter proceed upon formal pleadings.
Fifth, the respondents complain that the Concise Statement advances an alternative claim that the second and third respondents are liable as accessories to contraventions by the first respondent of certain statutory injunctions; but does not attribute to them any conduct or allege the possession of any relevant state or states of mind in that regard. They maintain that they cannot know how it is that the applicants might seek to constitute the second and third respondents as accessories to those contraventions without first knowing those matters. Again, there is substance to that complaint but it does not warrant the relief for which the respondents press. The applicants should identify in their concise statement facts that, if proved, would suffice to constitute the second and third respondents as accessories to the alleged contraventions (specifically, the conduct that implicates each of them in those contraventions, and the facts that establish—or from which the court could infer—the state or states of mind by reason of which that implication is said to arise).
Although no doubt important to the parties, the claim advanced against the respondents in this matter is of modest quantum. The matter is of a kind that naturally lends itself to concise statements. Undoubtedly, the claims against the respondents could be more clearly put; but that is not reason enough to require a more formal process of pleading. No relief in that nature is appropriate. Instead, the applicants should have an opportunity to reflect upon the observations contained herein and to file an amended concise statement. Thereafter, the respondents should respond in the usual way.
There shall be orders to that effect.
I certify that the preceding eleven (11) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Snaden. Associate:
Dated: 7 February 2022
SCHEDULE OF PARTIES
VID 301 of 2021 Applicants
Fourth Applicant:
SCOOB PTY LTD AS TRUSTEE FOR THE SEGUI FAMILY TRUST
Fifth Applicant:
RICHARD IGNATIUS AND JENNIFER KAYE SEGUI AS TRUSTEES FOR THE SEGUI FAMILY TRUST
Sixth Applicant:
DW SUPER FUND PTY LTD AS TRUSTEE FOR THE DW SUPER FUND
Seventh Applicant:
DW ASSETS PTY LTD AS TRUSTEE FOR DW TRUST
Respondents
Fourth Respondent:
DAVLYN PROPERTY PTY LTD AS TRUSTEE FOR THE SECRET HARBOUR UNIT TRUST
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