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Zeke Services Pty Ltd v Traffic Technologies Ltd

Zeke Services Pty Ltd v Traffic Technologies Ltd

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SUPREME COURT OF QUEENSLAND

CITATION:

Zeke Services Pty Ltd & Anor v Traffic Technologies Ltd & Anor [2005] QSC 135

PARTIES:

ZEKE SERVICES PTY LTD ACN 104 705 606 as trustee of the ZEKE DISCRETIONARY TRUST
(first plaintiff)
and
ADAM PETER GEANEY
(second plaintiff)
v
TRAFFIC TECHNOLOGIES LTD ACN 080 415 407
(first defendant)
and
CONSTANTINE ANDREW SCRINIS
(second defendant)

FILE NO:

BS 2612 of 2005

DIVISION:

Trial

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court

DELIVERED ON:

20 May 2005

DELIVERED AT:

Brisbane

HEARING DATE:

27 April 2005

JUDGE:

Chesterman J

ORDER:

Both applications be dismissed with costs to be assessed on the standard basis.

CATCHWORDS:

CONTRACTS – PARTICULAR PARTIES – VENDOR AND PURCHASER – GUARANTEES CONTAINED IN CONTRACTS AND COLLATERAL PROMISES – where the plaintiffs agreed to sell their shares in ‘the company’ to the defendants who were to pay by way of instalments, the first of which was duly paid – where the defendants alleged breaches of certain warranties under the share sale agreement – where the total of the warranty claims exceeded the amount of the second instalment and the first defendant paid that amount into its solicitors’ trust account and sought the appointment of an expert pursuant to the agreement – whether the plaintiffs action against the defendants claiming the balance of the purchase price and seeking damages for breach of contract and a declaration that the relevant clause of the share sale agreement was void as being against public policy should succeed – whether the defendants’ cross-application seeking a stay of the action on the ground that the agreement provided a mechanism of resolution in the circumstances of the dispute or, alternatively, that the proceedings be transferred to the Supreme Court of Victoria, should succeed.

Jurisdiction of Court (Cross-vesting) Act 1987 (Qld)

Baber v Kenwood Manufacturing Co Ltd (1978) 1 LLR 179, cited;
Badgin Nominees Pty Ltd v Oneida Ltd & Anor [1998] VSC 118; 18 December 1998, cited;
Baulderstone Hornibrook Engineering Pty Ltd v Kayah Holdings Pty Ltd (CIV1742/1996); 2 December 1997, discussed;
Channel Tunnel Group Ltd & Anor v Balfour Beatty Construction Ltd & Ors [1993] AC 334, cited;
Cott UK Ltd v FE Barber Ltd (1997) 3 All ER 540, discussed;
Dobbs v National Bank of Australasia Ltd (1934) 53 CLR 643, cited;
Huddart Parker v The Ship Mill Hill and Her Cargo (1950) 81 CLR 502, cited;
In Re An Arbitration Between Dawdy and Hartcup (1885) 15 QBD 426, cited;
Lee v The Showmen’s Guild of Great Britain [1952] 2 QB 329, cited;
Legal & General Life of Australia Ltd v A Hudson Pty Ltd (1985) 1 NSWLR 314, cited;
Racecourse Betting Control Board v Secretary for Air [1944] Ch 114, cited;
Strategic Publishing Group Pty Ltd v John Fairfax Publications Pty Ltd [2003] NSWSC 1134; 4 December 2003, cited;
The Heart Research Institute Ltd v Psiron Ltd [2002] NSWSC 646; 25 July 2002, discussed;
The South Australian Railways Commissioner v Egan (1973-1974)

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: [2005] QSC 135
Decision Date: 20 May 2005

CaseChat Overview and Summary

Zeke Services Pty Ltd brought an action against Traffic Technologies Ltd, alleging breaches of warranties contained within a share sale agreement. The plaintiffs claimed the balance of the purchase price, damages for breach of contract, and a declaration that a specific clause in the share sale agreement was void as being against public policy. The defendants, in turn, sought a stay of the proceedings, arguing that the share sale agreement provided an exclusive mechanism for dispute resolution, or alternatively, that the matter should be transferred to the Supreme Court of Victoria.

The court was tasked with determining whether the plaintiffs' action should proceed, and if so, whether the defendants’ application for a stay or transfer should be granted. The court considered the terms of the share sale agreement and the nature of the contractual dispute, including the existence and effectiveness of the agreement’s dispute resolution clause. The court also examined the public policy argument raised by the plaintiffs regarding the enforceability of the warranty clause.

The court found that the share sale agreement did not provide an exclusive mechanism for dispute resolution, and that the public policy argument did not render the warranty clause void. The court held that the plaintiffs' action should proceed, and dismissed both the stay application and the transfer application. The court ordered that both applications be dismissed, with costs to be assessed on the standard basis.

In summary, the court dismissed both the defendants’ application for a stay and their application for a transfer to the Supreme Court of Victoria, finding that the plaintiffs’ action against the defendants for breach of contract should proceed. The court ordered that both applications be dismissed, with costs to be assessed on the standard basis.

Orders

Orders of the court

Both applications be dismissed with costs to be assessed on the standard basis.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Zeke Services Pty Ltd & Anor v Traffic Technologies Ltd & Anor [2005] QSC 135
PARTIES:	ZEKE SERVICES PTY LTD ACN 104 705 606 as trustee of the ZEKE DISCRETIONARY TRUST (first plaintiff) and ADAM PETER GEANEY (second plaintiff) v TRAFFIC TECHNOLOGIES LTD ACN 080 415 407 (first defendant) and CONSTANTINE ANDREW SCRINIS (second defendant)
FILE NO:	BS 2612 of 2005
DIVISION:	Trial
PROCEEDING:	Application
ORIGINATING COURT:	Supreme Court
DELIVERED ON:	20 May 2005
DELIVERED AT:	Brisbane
HEARING DATE:	27 April 2005
JUDGE:	Chesterman J
ORDER:	Both applications be dismissed with costs to be assessed on the standard basis.
CATCHWORDS:	CONTRACTS – PARTICULAR PARTIES – VENDOR AND PURCHASER – GUARANTEES CONTAINED IN CONTRACTS AND COLLATERAL PROMISES – where the plaintiffs agreed to sell their shares in ‘the company’ to the defendants who were to pay by way of instalments, the first of which was duly paid – where the defendants alleged breaches of certain warranties under the share sale agreement – where the total of the warranty claims exceeded the amount of the second instalment and the first defendant paid that amount into its solicitors’ trust account and sought the appointment of an expert pursuant to the agreement – whether the plaintiffs action against the defendants claiming the balance of the purchase price and seeking damages for breach of contract and a declaration that the relevant clause of the share sale agreement was void as being against public policy should succeed – whether the defendants’ cross-application seeking a stay of the action on the ground that the agreement provided a mechanism of resolution in the circumstances of the dispute or, alternatively, that the proceedings be transferred to the Supreme Court of Victoria, should succeed. Jurisdiction of Court (Cross-vesting) Act 1987 (Qld) Baber v Kenwood Manufacturing Co Ltd (1978) 1 LLR 179, cited; Badgin Nominees Pty Ltd v Oneida Ltd & Anor [1998] VSC 118; 18 December 1998, cited; Baulderstone Hornibrook Engineering Pty Ltd v Kayah Holdings Pty Ltd (CIV1742/1996); 2 December 1997, discussed; Channel Tunnel Group Ltd & Anor v Balfour Beatty Construction Ltd & Ors [1993] AC 334, cited; Cott UK Ltd v FE Barber Ltd (1997) 3 All ER 540, discussed; Dobbs v National Bank of Australasia Ltd (1934) 53 CLR 643, cited; Huddart Parker v The Ship Mill Hill and Her Cargo (1950) 81 CLR 502, cited; In Re An Arbitration Between Dawdy and Hartcup (1885) 15 QBD 426, cited; Lee v The Showmen’s Guild of Great Britain [1952] 2 QB 329, cited; Legal & General Life of Australia Ltd v A Hudson Pty Ltd (1985) 1 NSWLR 314, cited; Racecourse Betting Control Board v Secretary for Air [1944] Ch 114, cited; Strategic Publishing Group Pty Ltd v John Fairfax Publications Pty Ltd [2003] NSWSC 1134; 4 December 2003, cited; The Heart Research Institute Ltd v Psiron Ltd [2002] NSWSC 646; 25 July 2002, discussed; The South Australian Railways Commissioner v Egan (1973-1974)