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  • Unreported Judgment

Farzan Fur Pty Ltd v Tabrizi

 

[2010] QSC 25

 

SUPREME COURT OF QUEENSLAND

 

CITATION:

Farzan Fur Pty Ltd  & Ors v Tabrizi;

Tabrizi & Anor v Farzon Fur Pty Ltd & Ors [2010] QSC 25

PARTIES:

FARZAN FUR PTY LTD ACN 101 559 513
(first plaintiff)
and
PARIS (QLD) PTY LTD ACN 102 522 494
(second plaintiff)
and
ABBAS FIROUZ-ABADI
(third plaintiff)
v
MOHAMMAD TABRIZI
(defendant)
AND BY COUNTER-CLAIM
MOHAMMAD TABRIZI
(first plaintiff by counter-claim)
and
TABRIZI PROPERTY GROUP ACN 069 620 515
(second plaintiff by counter-claim)
v
FARZAN FUR PTY LTD ACN 101 559 513
(first defendant by counter-claim)
and
PARIS (QLD) PTY LTD ACN 102 522 494
(second defendant by counter-claim)
and
ABBAS FIROUZ-ABADI
(third defendant by counter-claim)

FILE NO:

BS3143 of 2006

DIVISION:

Trial Division

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court of Queensland

DELIVERED ON:

9 February 2010

DELIVERED AT:

Brisbane 

HEARING DATE:

3 August 2009

JUDGE:

Daubney J

ORDER:

1.I will hear the parties as to the orders necessary to perfect this judgment, and as to interests and costs.

CATCHWORDS:

PROCEDURE – SUPREME COURT PROCEDURE – QUEENSLAND – PROCEDURE UNDER RULES OF COURT – SUMMARY JUDGMENT – where there are a number of interlocutory applications before the court – where the plaintiffs entered into a written “commercial cost plus contract” by which the defendant agreed to construct a residential building – where the terms of the contract allowed the defendant to engage subcontractors – where under the contract the defendant would issue a fortnightly or monthly cost statement to the plaintiffs listing which amounts were to be paid – where defendant submitted documents purporting to be tax invoices – where the plaintiff, believing the invoices and representations to be true, paid the monies to the defendant – where it is alleged the defendant knew these representations to be false and untrue – where the defendant claims for his actual expenditure or a reasonable sum for the work done - whether the defendant has satisfied that he has a real prospect of establishing the actual costs pleaded – whether summary judgment should be entered in favour of the plaintiff

Uniform Civil Procedure Rules 1999 (Qld) r 292

Bolton Properties Pty Ltd v JK Investments (Australia) Pty Ltd [2009] QCA 135, cited

David Securities Pty Ltd v Commonwealth Bank of Australia (1992) 175 CLR 353; [1992] HCA 48, applied

Mahesan v Malaysia Housing Society [1979] AC 374, applied
Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221; [1987] HCA 5, distinguished

COUNSEL:

PW Hackett for the first, second and third plaintiffs

C Wilson for the defendant

SOLICITORS:

Wilson Lawyers for the first, second and third plaintiffs

Herbert Geer for the defendant

  1. There are a number of interlocutory applications before me in this proceeding, the principal of which is the plaintiffs’ application for summary judgment.

The pleaded cases

  1. The case pleaded by the plaintiffs against the defendant can be summarised as follows:

(a)In August 2003, the plaintiffs entered into a written “commercial cost plus contract” (“the contract”) by which the defendant agreed to construct a residential building at 65 Berwick Street, Fortitude Valley;

(b)The terms of the contract allowed for the defendant to engage subcontractors to carry out any parts of the work;

(c)Under the contract, the defendant would issue a fortnightly or monthly cost statement to the plaintiffs listing:

(i)all payments made by the defendant;

(ii)invoices received by the defendant from subcontractors and others, and

(iii)delivery slips received by the defendant

which amounts were to be paid by the plaintiffs to the defendant;

(d)On various dates, the defendant submitted documents purporting to be tax invoices from a subcontractor, Atlantic Contractors Pty Ltd (“Atlantic Contractors”), totalling $183,000.  The defendant thereby represented that he had received these tax invoices from Atlantic Contractors, and the plaintiff, believing the representations and the tax invoices to be true, paid the $183,000 to the defendant.  In fact, the tax invoices were false and the defendant had not received them from Atlantic Contractors.  It is alleged that the defendant knew the representations to be false and untrue.  It is said that, by reason of these matters, “the plaintiffs have been deprived of the said monies and have suffered loss and damage in the sum of $183,000”.

(e)A similar claim is made in respect of the submission by the defendant to the plaintiffs of tax invoices purported to be issued by Tom Budsworth Plastering Pty Ltd totalling $161,833.  These invoices were false and, by pleas similar to those in respect of the Atlantic Contractors invoices, the plaintiffs claim that they have “been deprived of the said monies and have suffered loss and damage in the sum of $161,833”.

(f)It is pleaded, in the alternative, that the defendant has had and received the sum of $344,833 (being the sum of the Atlantic Contractors invoices and the Tom Budsworth invoices) to the use of the plaintiffs.

(g)There are two further claims by the plaintiffs, neither of which is in issue:

(i)a claim for $5,503.01 for QMBA Insurance paid by the plaintiffs in consequence of the delivery by the defendant of a costs statement on 1 July 2007 when that amount had actually formed part of a payment made to the defendant in July 2004;

(ii)similarly a claim for $3,711 for Harvey Norman which the plaintiffs paid after delivery of the November 2007 costs statement when that amount had also actually been previously paid to the defendant.

The defendant does not dispute that he is liable to account for these overpayments.

(h)The plaintiffs claim the following relief:

“1.The sum of $354,047.01 comprised of:

(a)$344,833 for deceit or, alternatively, being money payable by the defendant to the plaintiffs as money had and received by the defendant to the use of the plaintiffs.

(b)$9,214.01 for negligent misrepresentation or, alternatively, being money payable by the defendant to the plaintiffs as money had and received by the defendant to the use of the plaintiffs.

2.Interest pursuant to the Supreme Court Act 1995.

3.Costs.”

  1. In his third further amended defence (“the defence”), the defendant raises the following relevant matters:

(a)He pleads specific terms of the contract, including the “cost plus” provisions set out in clause 30 of the general conditions of the contract;

(b)He contends that, pursuant to Annexure D of the contract, each of the plaintiffs and Tabrizi Property Group Pty Ltd (“TPG”) entered into an agreement (“the project management agreement”) by which the plaintiffs appointed TPG as project manager for the project;

(c)The defendant says, in the alternative, that by the special conditions to the contract, the plaintiffs agreed to pay to the defendants a project management fee of 10 per cent profit of the development and sale of the units in the project;

(d)The defendant asserts that one Kevin Tabrizi “for and on behalf of TPG as agent for the defendant obtained quotations for the necessary formwork” to be used in the works under the contract.  Those quotations are particularised as:

-7 January 2004 Atlantic Contractors Pty Ltd              $215,000 plus GST

-4 January 2004Action Formwork                                   $184,000 plus GST

-Approx Feb 2004Frank Bermonte Formworking          $204,000 (inc GST)

(e)It is pleaded that the defendant “by its agent TPG” engaged subcontract labour and hired and purchased material for the formwork, paying a total of $96,722.99 for the labour and material.  The defendant pleads that he “consequentially was overpaid by the plaintiff in respect of the formwork in the amount of $86,277.01”, and says that the plaintiffs are entitled to a refund of that $86,277.01.

(f)The defendant then pleads that TPG, as agent for the defendant, caused the formwork to be completed, issued invoices in respect of the formwork, issued progress claims detailing the value of the formwork and details of money due to the defendant for the formwork.  It is said that on 11 December 2008 (well after these proceedings were commenced) the defendant issued amended progress claims for March, May, June, September and November 2004 and April 2005 and on 22 January 2009 served an amended final claim for the works under the contract which:

(i)amended details of the value of the formwork to accord with expert reports the defendant had obtained in these proceedings, and

(ii)amended details of the money due to the defendant in respect of the formwork.

(g)It is contended that, in respect of the defendant’s contractual entitlement to engage subcontractors, such subcontractors were engaged by TPG under its alleged project management agreement, or alternatively by TPG as agent for the defendant.

(h)The defendant admits issuing the Atlantic Contractors tax invoices to the plaintiffs, admits that the defendant thereby represented that he had received the invoices from Atlantic Contractors, and admits that these representations were false and untrue.  The defendant denies, however, that he made the representations knowing them to be false and untrue because the representations were made by Kevin Tabrizi (the defendant’s son) and the defendant did not know that Kevin was making the representations nor that the representations were known to be untrue by Kevin.

(i)Notwithstanding this denial of knowing of the falsity of the untrue representations, the defendant admits that he made or caused the representations to be made in order to induce the plaintiffs to pay the sum of $183,000, but says:

(i)his actual expenditure was $96,722.99, which he says was a reasonable sum for the work done;

(ii)alternatively, $220,000 was a reasonable sum for the work done;

(iii)the defendant should be paid or credited for the value of the work done;

(iv)if the defendant is not paid for his actual expenditure and labour, the plaintiffs will be unjustly enriched to the value of the formwork.

(j)The upshot of the defendant’s plea in this regard is to admit that the plaintiffs have been deprived of the sum of $86,277.01.[1]

(k)In respect of the Tom Budsworth Plastering Pty Ltd invoices, the defendant:

(i)admits submitting the invoices to the plaintiffs;

(ii)says that “the contents of the invoices ... provided details of the value of the work carried out by the defendant up to and including the date TPG submitted its progress claim” and “provided details of all monies due to, or claimed by” the defendant arising out of or in connection with the contract, and further that the amount of the invoices represented a reasonable sum for the plastering work undertaken;

(iii)admits that the defendant, by submitting the Tom Budsworth Plastering Pty Ltd invoices, represented that he had received those invoices from Tom Budsworth Plastering Pty Ltd, admits in fact that he did not receive those invoices, says that the defendant incurred the cost of plastering work of $161,833, says that on 10 May 2006 Tom Budsworth Plastering Pty Ltd issued a tax invoice to TPG for $161,833 and that the plasterwork the subject of this invoice was completed for TPG as agent for the defendant under the alleged project management agreement;

(iv)despite effectively admitting the falsity of the representation, makes a similar plea as in respect of the Atlantic Contractors representations, namely that the representations were made by Kevin and that the defendant neither knew that the representations were being made nor that the representations were known to be untrue by Kevin;

(v)admits that the representation was made to induce payment, but contends that the $161,833 represented the defendant’s expenditure on plastering work undertaken by Tom Budsworth Plastering Pty Ltd or alternatively is a reasonable sum for the plastering work undertaken, and accordingly denies that the plaintiffs have been deprived of the $161,833.  It is further contended that if the defendant is not paid for his expenditure on the plastering work, or is required to repay the monies paid, the plaintiffs will be unjustly enriched to the value of $161,833.

(l)As already noted, the overpayments in respect of QMBA Insurance ($5,503.01) and Harvey Norman ($3,711) are effectively admitted.

  1. The defendant and TPG have counter-claimed against the plaintiffs for the balance of construction fees ($31,000) owing under the contract and for 10 per cent profit on the project ($131,720), and interest on those amounts, yielding a claim for $245,845.80. Alternatively, the defendant seeks to set off against that amount the sums totalling $95,491.02 which it effectively admits in the defence ($86,277.01 for formwork, $5,503.01 for QMBA Insurance and $3,711 for Harvey Norman).
  1. It is sufficient for present purposes to note that the plaintiffs have filed a reply and answer which alleges, inter alia:

(a)The alleged project management agreement with TPG was never entered into or, if it was, it is void or unenforceable because TPG was not registered under the Queensland Building Services Authority Act 1991 (“QBSA Act”) in November 2003;

(b)Neither the defendant nor TPG paid $96,722.99 for formwork and there is no evidence of such payment;

  1. Neither the defendant nor TPG incurred the expenditure referred to in the Tom Budsworth Plastering Pty Ltd invoices and there is no evidence of such payments having been made on account of plasterwork.

The application for summary judgment

  1. Uniform Civil Procedure Rule 292 provides:

292Summary judgment for plaintiff

(1)A plaintiff may, at any time after a defendant files a notice of intention to defend, apply to the court under this part for judgment against the defendant.

(2)If the court is satisfied that -

(a)the defendant has no real prospect of successfully defending all or a part of the plaintiff’s claim;  and

(b)there is no need for a trial of the claim or the part of the claim;

the court may give judgment for the plaintiff against the defendant for all or the part of the plaintiff’s claim and may make any other order the court considers appropriate.”

  1. The discretion to give judgment for all or part of the plaintiffs’ claims only arises under this rule if the Court is satisfied of both of the matters mentioned in r 292(2)(a) and (b).  That involves considering, under r 292(2)(a), whether the defendant has no real prospect of successfully defending all or part of the plaintiff’s claim.  The appropriate inquiry in this respect is whether there exists a real, as opposed to a fanciful, prospect of success.[2]
  1. The claims in respect of the overpayments for the QMBA Insurance and Harvey Norman amounts are uncontroversially recoverable by the plaintiffs on conventional restitutionary grounds.
  1. In respect of the claims brought in consequence of the false Atlantic Contractors and Tom Budsworth Plastering Pty Ltd invoices, the plaintiffs cast their claims as being for damages for deceit or, alternatively, under the restitutionary rubric of monies had and received. It is clear that a claimant in the position of the present plaintiffs has alternative remedies against the defendant, namely to recover the amount of the monies paid pursuant to the false invoices by way of restitution for the defendant’s unjust enrichment, or to recover the loss sustained as damages for tort. The plaintiffs need not elect between these alternatives before the time has come for judgment to be entered in their favour in one or other of those causes of action.[3]
  1. The defendant, by his counsel, properly conceded that the fraudulent nature of the invoices originally delivered is not disputed. He contended, however, that what is in dispute, and the factor which militates against the grant of summary judgment, is that the quantum of the plaintiffs’ loss is in dispute.
  1. In respect of the claims brought in deceit, the defendant’s submissions are that:

(a)The measure of damages for deceit is the value transferred, less the value received;

(b)The plaintiffs, in fact, received the formwork and the plaster work which was the subject of the fraudulent invoices;

(c)The defendant engaged subcontract labour and purchased materials to undertake the formwork, and he incurred expenditure in relation to the plaster work;

(d)In any event, the plaintiffs’ loss is not established merely by there being an accounting for the amounts which the defendant expended in providing the formwork and plaster work, but rather what needs to be assessed is the difference between the amount paid by the plaintiffs pursuant to the fraudulent invoices and the value of the work supplied by the defendant and his subcontractors.

  1. Similarly, insofar as the plaintiffs found their claim as one for unjust enrichment, the defendant’s contention is that the amount, if any, by which the defendant has been unjustly enriched is determined by the difference between the amount paid under the false invoices and the value of the formwork and plaster work received by the plaintiffs.
  1. It needs to be recalled, however, that the relationship between the plaintiffs and the defendant, and the source of the defendant’s entitlement to be paid for the works provided, was the “cost plus” contract entered into between the parties in August 2003.  By clause 1(c) of the general conditions to that contract, the obligation on the plaintiffs was to pay “the Total Cost of the Works to the [defendant] in the manner and at the times stated in the Contract”.
  1. Clause 30.1 of the general conditions of the contract provided that the “Total Cost” consisted of the sum of the following, namely:

(a)The “Actual Cost of the Works”, and

(b)The “cost plus fee component in consideration of the performance by [the defendant] if providing services during the construction phase”.

  1. The items which constituted the Actual Cost of the Works were enumerated in clause 30.2 of the general conditions. Not surprisingly, they include the actual cost of all materials, supplies and equipment incorporated in the works, and the direct labour costs (labour employed specifically on or contracted for the works).
  1. The “cost plus fee” component was specified in item C.3 of the schedule to the contract as “$210,000 and 10% of profits”.
  1. It is unnecessary to labour the point by detailing at length the various items and components included in the definition of “Actual Cost of the Works”. What is clear is that the defendant’s contractual entitlement was to be paid those actual costs plus, ultimately and in accordance with the terms of the contract, the cost plus fee.
  1. Those considerations, in my view, must therefore inform the proper approach to assessing the plaintiffs’ entitlements to recover in respect of the false invoices. So, in respect of the tortious claim for deceit, the measure of damages, on first principles, is an award which serves to put the plaintiffs in the position they would have been if the fraudulent representations had not been made. True it is that, in general terms, this is often represented by the amount paid less the value of the goods received. But in a case such as the present, the inquiry for the purpose of putting the plaintiffs in the position they would have been if the fraudulent representations had not been made must be to ask what would the plaintiffs have been required to pay if, in the context of an ongoing building contract such as this, the proper rather than the false claims for payment had been made. The answer to that, by reference to the terms of the contract, is that the proper claims would have been for the actual cost of the works.
  1. Similarly, given the admittedly false invoices on which payment was made, there is a prima facie obligation on the part of the defendant to make restitution. It is then for the defendant to point to circumstances which the law recognises would make an order for restitution unjust:

“There can be no restitution in such circumstances because the law will not provide for recovery except when the enrichment is unjust.  It follows that the recipient of a payment, which is sought to be recovered on the ground of unjust enrichment, is entitled to raise by way of answer any matter or circumstance which shows that his or receipt (or retention) of the payment is not unjust.”[4]

  1. The question in the present case, then, would be whether, and to what extent, the defendant demonstrates that his retention of all or part of the monies paid pursuant to the false invoices is not unjust. The defendant’s submission in this regard, again, was that the measure of the amount which he should be entitled to retain has been “not unjust” is the value of the formwork and plaster work supplied. Reliance was placed in that regard on authorities such as Pavey & Matthews Pty Ltd v Paul,[5] in which Deane J observed, at 263, that the concept of monetary restitution involves the payment of an amount which constitutes, in all the relevant circumstances, fair and just compensation for the benefit or “enrichment” actually or constructively accepted, and that ordinarily, that will correspond to the fair value of the benefit provided.  However, this is not a case like Pavey & Matthews Pty Ltd v Paul in which there was, at law, no contract between the parties governing the defendant’s entitlement to be remunerated.  Rather, insofar as the plaintiffs’ claim is one for restitution, it is, to my mind, unarguable that the only amount for which the defendant could demonstrate an entitlement to retain as being “not unjust” is that which would properly have been payable to him as the actual cost of the works in accordance with the terms of the contract.
  1. Turning then to the claim in respect of the false Atlantic Contractors invoices, the defendant pleads, in paragraph 14 of his defence, and after admitting that the relevant Atlantic Contractors representations were made in order to induce the plaintiffs to pay the sum of $183,000 to the defendant, that the defendant:

“(b)Says that the defendant’s actual expenditure on formwork was $96,722.99, which was a reasonable sum for the work done;

(bb)Alternatively to subparagraph (b), says that $220,000 was a reasonable sum for the work done;

(c)Says further that the defendant should be paid or credited for the value of the work done;

(d)Says that, if the defendant is not paid for his actual expenditure and labour, the plaintiff will be unjustly enriched to the value of the formwork done.”

  1. In the course of argument, counsel for the defendant properly conceded that the attempt to raise some sort of quantum meruit offset in the form pleaded in subparagraph (bb) was untenable. For the reasons I have given above, subparagraph (c) represents the wrong test. Subparagraphs (b) and (d) together amount to the extent to which the defendant could avoid judgment for the amount of the false Atlantic Contractors invoices. It will immediately be noted, as appears from the summary of the pleadings above, that the defendant effectively admits that the plaintiffs have been deprived of the difference between the amount paid of $183,000 and the claimed actual expenditure of $96,722.99, being $86,277.01.
  1. For present purposes, the question is whether the defendant has satisfied me that he has a real, as opposed to a fanciful, prospect even of establishing that his actual expenditure was the amount he asserts, namely $96,722.99.
  1. On 19 March 2009, it was ordered that the evidence in chief in this proceeding of the trades and supply witnesses to be called by the defendant should be on affidavit. These affidavits were required to be filed and served by 1 May 2009. It was further directed that the defendant would not, without leave of the Court, otherwise be entitled at trial to lead any evidence from any trade and supply witnesses. Counsel for the plaintiffs has analysed the affidavits by the defendants’ trades and supply witnesses which have been filed and served in the proceeding, and contends that it is not possible to discern if these relate to formwork, apart from the title of the respective suppliers. He says, at best, that the invoices which appear to relate to formwork total only $71,933.28. It is also submitted that many of the amounts comprising the alleged actual expenditure on formwork have already been paid by the plaintiffs in prior progress claims.
  1. The defendant, however, on 23 January 2009, filed an affidavit by Mr Richard Alexander, an engineer, to which he exhibits reports that he has provided going to, inter alia, the claimed cost of formworks, supply and installation.  In reports dated 13 May 2008 and 17 June 2008, Mr Alexander outlines his review of invoices which had been provided to him in respect of the supply and installation of formwork in the project.  He expresses the view that the invoices provided to him typically cover the purchase and hire of the sort of equipment that would be used in connection with formwork.  Whilst he identifies actual and potential deficiencies in respect of the documentation that has been provided to him, he says that he has verified that all of the primary documents to which he has had regard have been paid, and that the invoices which he considers represent actual payment in connection with formwork total some $97,633.22. 
  1. In light of that evidence from Mr Alexander, which was not challenged before me, I do not consider that it could be said that the defendant’s prospects of defending this aspect of the claim, at least to the pleaded extent of $96,722.99, is fanciful. The material, in my view, reveals that the defence sought to be mounted in this regard actually exists. Whether that is proved and accepted at trial is another question.
  1. The case in respect of the false Tom Budsworth Plastering Pty Ltd invoices falls into a different category. In that regard, the defendant squarely asserts in paragraph 18(b) of the defence that he actually incurred the cost of plastering work in the total amount of $161,833. Further, in paragraph 21(c) of his defence, he further asserts that this payment represented:

“(i)the defendant’s expenditure on the plastering work undertaken by Tom Budsworth Plastering;

(ii)further, and in the alternative, a reasonable sum for the plastering work undertaken”.

  1. However, for the reasons I have previously given, the relevant question for present purposes is whether the defendant has demonstrated to me a real prospect of proving, as he pleads, that his actual expenditure on the plastering work was the asserted sum of $161,833.
  1. In this regard, there is an affidavit by Thomas David Budsworth, who deposes to being a plasterer who operates as a sole trader, and exhibits to his affidavit a copy of “the invoice for labour supplied in respect of building works carried out by me at 65 Berwick Street, Fortitude Valley, Brisbane, Queensland by way of contract with Tabrizi Property Group Pty Ltd”. 
  1. The copy of the tax invoice, which is dated 10 May 2006, is addressed to TPG and is specified to be from “Tom Budsworth”. Notably, there is no reference to “Tom Budsworth Plastering Pty Ltd”. Company searches show that no such entity exists. The invoice is said to be “for plaster work undertaken at 65 Berwick Street, Valley” and then records:

“$162,553 payment received in full

  • 11/2004  $110,000
  • 1/2005      $51,833
  • 4/2005           $720”
  1. The clear implication from this invoice is that the sum of $162,553 was paid for the plaster works by the tranches specified. The assertion that Budsworth had received payment of $110,000 in November 2004 and $51,833 in January 2005 had previously been made on the false Tom Budsworth Plastering Pty Ltd invoices and in correspondence from the defendant’s solicitors to the plaintiffs’ solicitors in February 2007 (undoubtedly on instructions).
  1. A review of the bank records of both the defendant and TPG, however, reveals these assertions to be palpably false. A cheque book stub for cheque number 401 drawn on the Bank of Queensland account in the name of the defendant and Kevin Tabrizi records a cheque dated 1 November 2004 payable to Tom Budsworth in the sum of $22,000 only (not $110,000). The bank statements reveal that this cheque for $22,000 was paid on 2 November 2004. A cheque to Budsworth drawn on that same account dated 11 January 2005 was also in the sum of $22,000 (not $51,833 as previously represented). That cheque was paid on 11 January 2005. There was, however, a cheque drawn on a National Australia Bank account in the name of the defendant and Manijeh Tabrizi dated 7 April 2005 in favour of “Tom Plastering” in the sum of $720.
  1. When these matters were raised with the defendant’s solicitors, they responded by a letter dated 17 April 2007 resiling from the previous assertions and asserting:

“In relation to our client’s payment of Tom Budsworth Plastering Pty Ltd’s (“Tom Budsworth”) invoice, we are instructed as follows:

  1. Bank of Queensland cheque no 481 in the amount of $22,000 was drawn in favour of Tom Budsworth on 11 January 2005;
  1. Bank of Queensland cheque no 401 in the amount of $22,000 was drawn in favour of Tom Budsworth on 1 November 2004;
  1. Bank of Queensland cheque no 266 in the amount of $100,000 was drawn in favour of “cash” on 2 August 2004.  Mr Kevin Tabrizi cashed this cheque and paid a portion of the $100,000 totalling $55,000 periodically to subcontractors of Tom Budsworth in part satisfaction of the remainder of its invoice;  and
  1. Our client transferred a 1994 Mercedes Benz (registration no 149GGT) (“the vehicle”) to the value of $45,000 to Tom Budsworth, again in part satisfaction of the remainder of its invoice.”
  1. Further investigations by the plaintiffs’ solicitors have turned up the documents lodged with Queensland Transport in relation to the transfer of vehicle registration in respect of Mercedes Benz registration number 149GGT. These reveal that the vehicle was transferred to Jade Budsworth, and that under the transfer application and the statutory declaration contained therein, the defendant declared that the vehicle had a “dutiable value” of $15,000.
  1. The best that the defendant’s evidence currently reaches is a hearsay affidavit by the defendant’s solicitor which advanced a further version of events, namely that an amount of $83,553 in cash was paid to subcontractors of Budsworth (as opposed to Budsworth himself as previously asserted) from the cash cheque of $100,000. No primary documents are produced in any way to substantiate this assertion.
  1. Acknowledging again that the question for present purposes is whether the defendant has satisfied me that he has a real prospect of establishing that the actual cost of the plaster works incurred by him were, as he pleads, a total of $161,833, it is clear that the defendant has failed to adduce any evidence which would satisfy me in that regard. The matters of fact to which I have just referred demonstrate, in my opinion, unreliability of evidence to such an extent that it could not be said that the defendant’s prospects of success on this aspect could be anything but fanciful.
  1. Accordingly, and subject to the observations which follow, there should be summary judgment for the plaintiffs in respect of the following parts of the claim:

(a)In respect of that part of the plaintiffs’ claim pursuant to false Atlantic Contractors invoices, the amount of $86,277.01;

(b)In respect of the false Tom Budsworth Plastering Pty Ltd invoices, the amount of $161,833;

(c)In respect of the QMBA Insurance overpayment, the sum of $5,503.01, and

(d)In respect of the Harvey Norman overpayment, the sum of $3,711.

The total is $257,324.02.

  1. The net effect of this judgment will be that, in respect of the plaintiffs’ claim, the only issue remaining for trial is whether the defendant satisfies the Court that its actual expenditure on formwork was the asserted sum of $96,722.99. To the extent that the defendant would otherwise seek to assert an entitlement to take account of the value of the works, as opposed to the amount of the actual expenditure, such claims are, for the reasons I have given above, not maintainable. Accordingly, as sought by the plaintiffs, the defendant’s pleading, to the extent that it avers an entitlement to be credited for the value of the formworks should be struck out.
  1. In respect of the defendant’s counter-claim, the plaintiffs admit that $31,000 of the construction fee has not been paid to the defendant. The plaintiffs set that amount off against their claim. In the context of the present application, it seems to me that the appropriate course is to order that the amount which will be entered by way of summary judgment be stayed to the extent of $31,000 to take account of that component of the counter-claim.
  1. Otherwise, the counter-claim consists of a claim by the defendant and Tabrizi Project Management Pty Ltd which turns on factual issues, principally whether a project management agreement was entered into, and if so, with which entity. The issues which arise on that contractual claim are clearly not amenable to determination in the present application, and will need to be tried in the ordinary course.
  1. Finally, the defendant has applied for the appointment of an expert to value the plaster work and formwork performed under the contract. If, as a matter of law, the remaining issues between the parties turned on questions of value, rather than actual cost of work, I may have been amenable to such a course being adopted. For the reasons I have given above, however, the question of value is not germane, and accordingly there is no point in acceding to the application that an expert valuer be appointed.
  1. Accordingly, there will be judgment for the plaintiffs in respect of those parts of their claims which I have identified above, and subject to the stay in respect of the $31,000. There will also need to be orders regularising the pleadings to take account of this judgment and to dismiss the defendant’s application for the appointment of an expert witness.
  1. I will hear the parties as to the orders necessary to perfect this judgment, and as to interest and costs.

Footnotes

[1] Wrongly calculated in para 16(b) of the defence as $81,176.88.

[2] Bolton Properties Pty Ltd v JK Investments (Australia) Pty Ltd [2009] QCA 135.

[3] Mahesan v Malaysia Housing Society [1979] AC 374 at 383.

[4] David Securities Pty Ltd v Commonwealth Bank of Australia [(1992) 175 CLR 353 per Mason CJ, Deane, Toohey, Gaudron & McHugh JJ at 379.

[5] (1987) 162 CLR 221.

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Editorial Notes

  • Published Case Name:

    Farzan Fur Pty Ltd & Ors v Tabrizi; Tabrizi & Anor v Farzon Fur Pty Ltd & Ors

  • Shortened Case Name:

    Farzan Fur Pty Ltd v Tabrizi

  • MNC:

    [2010] QSC 25

  • Court:

    QSC

  • Judge(s):

    Daubney J

  • Date:

    09 Feb 2010

Litigation History

No Litigation History

Appeal Status

No Status