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  • Unreported Judgment

ABN Amro Morgans Ltd v Davies


[2009] QSC 18









No 9951 of 2008










..DATE 12/02/2009



HIS HONOUR:  The plaintiff seeks summary judgment from the defendant in respect of money owing to the plaintiff for the purchase on the instructions of the defendant of a number of share warrants on the stock market.


The defendant denies liability alleging that any agreement between her and the plaintiff was void or voidable. 


It is desirable to recount something of the history of the defendant in order to appreciate the defence which she postulates.  The background involves the town of Mackay which is where the defendant lived and worked and, in particular, where she worked in a dress shop owned by a partnership of herself and her mother.  She worked in businesses with her mother from 1984. 


In 2002 she commenced investing on the stock exchange.  Her brother was a stockbroker employed by Ord Minnett and it was on his advice that she decided to embark on that course.  She was, it seems, successful between when she started in 2002 with an initial investment of about $31,000 and 2008 her net worth on the stock exchange grew from $31,000 to about $1.25 million, measured as at December 2007.


During 2008 the value of her holdings declined radically because of an investment in a firm called Opes Prime which went into receivership.  She deposes that she was left with about $25,000 worth of shares.


In June 2008 her brother or his assistant contacted an officer of the plaintiff with a request that an account for the defendant be opened with the plaintiff.  As a result that officer sent, addressed to the defendant, through the email account which had been given to the plaintiff, a Financial Services Guide, a Standard Terms and Conditions booklet and a risk profile attached to the account opening application form.  That material was sent by email.


Ms Davies signed the application form and it was returned to the plaintiff on the 4th of June.  She also signed a Sophisticated Investor Application which required a Sophisticated Investor Accountant's Certificate.  Such a certificate was attached to the application signed by her accountant.  It confirmed that she had aggregate net assets of over $2.5 million.  She does not depose to her precise net assets but it seems that this figure was not correct.


On the 12th of August the plaintiff emailed an Australian Stock Exchange Warrant Client Agreement form to the defendant at the nominated email address.  On the following day (the plaintiff's affidavit says 13 June but it is evidently a mistake for 13 August), the plaintiff received the warrant agreement form signed by the defendant.


Subsequently various officers of the plaintiff were instructed, apparently through the defendant's brother or the secretary, to purchase share warrants covered by that warrant agreement form.  They did so.  It is unnecessary to list the warrants purchased.  They were purchased in September and it is notorious that the stock market was falling drastically in that month and that Lehman Brothers, a United States broking house collapsed.


The defendant in each case was telephoned by one of the plaintiff's officers and asked for confirmation of the order which had been received.  The plaintiff's officers all depose that she gave her confirmation of each order before the order was executed.  The defendant does not admit that she confirmed the orders but concedes that she received a number of phone calls and does not deny the plaintiff's allegations.


She admits also signing the other documents to which I have referred.  However, her evidence is that she was asked by her brother for consent to use her existing leveraged equities account which had been set up with Ord Minnett.  She says that subsequent to that request, which she orally granted, her brother's secretary brought her some documents to sign and that she signed them without reading them.  Those documents were the original application to the plaintiff for an account.


The defendant says she had no idea that an account was being opened with the plaintiff and did not ask her brother or his secretary to set up that account.  The defendant deposed that she understood that the secretary, at all material times, was acting on instructions from her brother and that she was not acting on instructions from the defendant.


She described signing the initial agreement in some detail but I do not think that is particularly relevant at the moment.  She conceded that her signature appeared at the bottom of the ASX Warrant Agreement.  She also conceded that that document was filled in, unlike some others, at the time she signed it.  She said that she did not read it and did not understand that by signing it she was declaring that she had received and read the booklet published by the Australian Stock Exchange.  In fact, she had not, she says, received that booklet and had never read it.


The document which she signed, that is the Warrant Client Agreement form, began with a declaration by the person signing it, "I have received and read a copy of the explanatory booklet issued by the Australian Stock Exchange Limited in respect of warrants."  Precisely what part of that sentence the defendant did not understand is unclear but probably the answer is all of it since she deposes that she did not read it.


That was the document which covered the trades which are the subject of the plaintiff's claim.  As to the trades themselves the defendant denies placing orders for them and I am prepared to act on the basis that that is the position; but she does not deny the evidence from the officers of the plaintiff that they telephoned her to confirm the instructions to buy the warrants.  She deposed, "I am unable to confirm or deny receiving the calls alleged by Ms McClimon-Smith because I am not able to remember whether they were made or not.  I did receive some calls from Ms McClimon-Smith asking me to confirm trades and I gave this confirmation because Griff" (that is her brother) "had told me to."


A similar position exists in relation to confirmation calls from other officers of the plaintiff.  Not until she received a letter from the plaintiff on the 26th of September did she realise that there was a problem, she says.  That letter was hand-delivered to her mother's dress shop.


The evidence clearly makes out the plaintiff's cause of action and the indebtedness for the defendant.  Mr Hanlon submitted that a triable issue was raised by the evidence to which I have referred.  He submitted that the fact that a number of the documents, relating to the opening of the account, were blank when signed by the defendant and that a guidance book was not ever received by her meant that either the contract was void or there was never a contract formed.  These results he expressed as either being founded on the doctrine of voidness for uncertainty or on the doctrine of non est factum.


In my judgment there is nothing uncertain about the relevant documents.  They were, in fact, in the case of the earlier documents completed before being sent to the plaintiff and the inference is that they were completed by the defendant's brother or the secretary.


It seems to me that it matters little since the earlier documents are not crucial to the present claim.  If they were, I would not be satisfied that there is any possibility of a defence of non est factum being made out.  That is perfectly clear from the cases to which Mr Newton SC referred me, Sunbird Plaza Proprietary Limited v Boheto Proprietary Limited [1983] Queensland Reports 248, Petalin v Cullen (1975) 132 CLR 355 and Equuscorp Proprietary Limited v Glengallen Investments (2004) 218 CLR 471.


The unavailability of the defence of non est factum is, in my judgment, so obvious as to render the citation of particular passages superfluous.  No other ground of voidness was suggested.


Mr Hanlon also suggested that voidability might be established if the matter went to trial on the basis that there may be unconscionability disclosed.  The difficulty with that submission is that there is simply no evidence at all to suggest that the plaintiff had anything to do with the placing of these orders.  There is not the slightest scrap of evidence to suggest anything unconscionable on the part of the plaintiff.


Summary judgment cannot be resisted by speculation.  The argument seemed to address the behaviour of a number of people and some evidence was adduced which was gained by the inspection of documents in the possession of third parties.


The defendant says, for example, that she never gave instructions for her accountants to send the plaintiff the accountancy certificate necessary to support the application to which I referred earlier but it is clear that the accountants did so.


Be that as it may, however wrongful their conduct might have been as against the defendant, it can in no way be attributed to the plaintiff.  The defence contains an allegation that the defendant's brother and his secretary were acting as agents for the plaintiff, but again there is not the slightest evidence of that and counsel, quite rightly, abandoned that submission in the course of the hearing.


The reality of the matter is that as far as the warrants are concerned, the defendant signed the document which had been filled in, without reading it, which established the general terms of the agreement and before each order was placed confirmed her instructions to place it.


Nothing casts any doubt on any of that and nothing is raised in the defendant's evidence which would suggest a defence to that claim.  In my judgment the plaintiff has clearly established that the defendant has no real prospect of successfully defending the claim. 


In the alternative it was submitted that I should either hold that there was a need for a trial of the claim within the sense of rule 292(2)(b) or that even if I were otherwise minded, I should, in the exercise of my discretion, still not give summary judgment.


The precise basis for this was unclear.  It seemed to found upon the fact that the defendant claims to have been done ill by everyone in sight:  her brother, his secretary, her accountant, her former solicitors and allegedly, the plaintiff.  I say "allegedly" because as I have said, there is no evidence of it and no reason to think that such evidence might exist.


Nonetheless, it was submitted that the need for the trial arose because of a need to have disclosure of documents from the plaintiff.  The history of the matter is worth bearing in mind in that context.


The defendant was served with the claim and statement of claim and an amended statement of claim on the 16th of October 2008.  On the 17th of November she filed a defence which contained simply a single paragraph, in effect, not admitting the claim.


That defence was filed on her behalf by solicitors then instructed for her.  A further amended statement of claim was filed and served by the plaintiff on the 5th of December but that did not raise any transaction which had not been pleaded in earlier versions of the statement of claim.  The application for summary judgment had been served three days earlier.  Since then the application has come before the Court and been adjourned on four occasions in order to permit the defendant to file and serve further material.


I accept the plaintiff's submission that the defendant has had abundant time to put any evidence before the Court which might show that there is a need for a trial of the claim.  She simply has not done so.  I think it most improbable that disclosure from the plaintiff would adduce anything which would advance her case and she has had disclosure of documents from her accountant and from Macquarie Banking Group, one of the companies which was involved in the placement of the orders for warrants with the defendant's brother.  There is no reason to suppose that any further delay will achieve anything for the defendant.


The plaintiff is not required to be kept out of judgment because the defendant speculates that she might wish to add further parties by way of third party proceedings although it was submitted that that was something to which consideration was being given.


I think I can infer from the absence of any sort of defence in the first notice of defence filed in November last year, that in the month or so which was available for filing that defence, the defendant was unable to put material before her then solicitors which would found an arguable defence.


I see no reason to conclude that there is a need for a trial and no matters which would give rise to the exercise of my discretion adversely to the plaintiff.


The quantum of the plaintiff's claim is not challenged.  The issues are not particularly complex.  In my judgment the plaintiff is entitled to avoid the trial and to have judgment now. 




HIS HONOUR:  I give judgment for the plaintiff for $1,855,814.20 and interest under the Supreme Court Act of 1995 of $71,690.36 and costs to be assessed.




HIS HONOUR:  I vary the restraining order made this morning by deleting the words, "Until the trial of this proceeding or such earlier order" and inserting in lieu, "until 5 p.m. on 13 February 2009."  I adjourn the application to the 13th of February 2009.



Editorial Notes

  • Published Case Name:

    ABN Amro Morgans Ltd v Davies

  • Shortened Case Name:

    ABN Amro Morgans Ltd v Davies

  • MNC:

    [2009] QSC 18

  • Court:


  • Judge(s):

    Fryberg J

  • Date:

    12 Feb 2009

Litigation History

No Litigation History

Appeal Status

No Status