Queensland Judgments
Authorised Reports & Unreported Judgments
  • sclq logo
  1. Caselaw
  2. QDC
  3. 2000
  4. Rushton (Qld) Pty Ltd v Rushton (NSW) Pty Ltd - [2000] QDC 334

Authorised Reports & Unreported Judgments
Exit Distraction Free Reading Mode
  • Unreported Judgment

Rushton (Qld) Pty Ltd v Rushton (NSW) Pty Ltd[2000] QDC 334

Rushton (Qld) Pty Ltd v Rushton (NSW) Pty Ltd[2000] QDC 334

DISTRICT COURT OF QUEENSLAND

CITATION:

Rushton (Qld) P/L v Rushton [2000] QDC 334

PARTIES:

RUSHTON (QLD) PTY LTD

ACN 079 140 364

Plaintiff

-v-

RUSHTON (NSW) PTY LTD

ACN 079 164 202

Defendant

FILE NO/S:

D5024 OF 1999

DIVISION:

District Court

PROCEEDING:

Civil Jurisdiction

ORIGINATING COURT:

Brisbane

DELIVERED ON:

7 December 2000

DELIVERED AT:

Brisbane

HEARING DATE:

6 and 7 December 2000

JUDGE:

ORDER:

Judge Forde

APPLICATION TO FURTHER AMEND THE AMENDED DEFENCE IS REFUSED.  THAT THE DEFENDANT DO PAY THE PLAINTIFF’S COSTS OCCASIONED BY THE APPLICATION AND THE DELAY OF THE COMMENCEMENT OF THE TRIAL TO BE ASSESSED.

CATCHWORDS:

Uniform Civil Procedure Rules (UCPR) rule 5

Rigato Farms Pty. Ltd. V. Ridolfi Appeal No. 11448 of 1999;  unreported; 28th July, 2000; QCA.

Queensland v J.L. Holdings Pty. Ltd. (1996-1997) 189 CLR 146

Codelfa Constructions Pty. Ltd. V. State Rail Authority of NSW (1982) 149 CLR 337 at 352

Nemeth v Bayswater Road Pty. Ltd. (1988) 2 Qd.R. 406.

Cohen v McWilliam (1995) 38 NSWLR 476

COUNSEL:

Mr L.D. Bowden for the plaintiff

Mr A.M. Daubney S.C. for the defendant

SOLICITORS:

Bennett & Philp for the plaintiff

Macrossans for the defendant

Introduction

  1. [1]
    This is an application to further amend the Amended Defence filed on 14th June 2000.  In this action, the plaintiff, Rushton (Qld) Pty Ltd. claims the sum of $170,869.45 being monies due and payable by the defendant, Rushton (NSW) Pty. Ltd.  for work and labour done and materials supplied.  The claim is made pursuant to a document entitled “Rushton Group Equity Holders Agreement” (hereinafter called the “Equity Holders Agreement”.  The plaintiff and the defendant carried on the business of providing valuation services to the public. The parties agreed to participate in a co-ordinated national valuation services business using the name “Rushton” in order to provide valuation services across Australia and in Papua New Guinea. 
  1. [2]
    One purpose of the Equity Holders Agreement was that the relevant parties to same would refer valuation work originating within their particular state or territory to a party to the Agreement who was authorised by it to provide valuation services within its area. Clause 14 of the said Equity Holders Agreement provided as follows:

“14. Interstate Work and sharing of resources

14.1 The Group Partners and the Licensees agree:

  1. (1)
    that any work within a Territory is to be undertaken by the person holding the Name Licence for that Territory subject to the exceptions set out in the clause;
  1. (2)
    that a fee equal to 10% of the amount billed for work performed by a Licensee will be payable to the person who introduces the work where RGPL (Rushton Group Pty. Ltd.) or another Group Partner or Trading Licensee introduces work to be carried out in another Licensee’s Territory.” 
  1. [3]
    The parties to the Equity Holders Agreement included the plaintiff and the defendant, their partners and other entities from other states, and Michael Holzberger and Peter George Rogan, the principals of the plaintiff and the defendant respectively. Mr. Holzberger entered into the said Agreement both as a shareholder in RGPL and in his personal capacity. Mr. Rogan entered into the said Agreement in his capacity as trustee of the Peter George Rogan Trust and in his personal capacity.

Background

  1. [4]
    Mr. Holzberger and Mr. Rogan were the principals involved in the negotiations both for the Equity Holders Agreement and also the subsequent agreement to sell  certain interests of Mr. Holzberger’s companies including the plaintiff to certain entities in which Mr. Rogan had an interest. The latter agreement was called the Sale of Business Interests Agreement (the “Sale Agreement”) and is dated 22nd October, 1999.  The defendant was not a signatory to the said Sale Agreement.  The purpose of the said Sale Agreement was to terminate the Equity Holders Agreement and to dismantle the national valuation service structure which had been set up by that initial agreement.  It was dated 1st September, 1997.
  1. [5]
    Pursuant to the Equity Holders Agreement, the plaintiff at the request of the defendant, performed valuation services for various of the defendant’s clients. The relevant invoices appear in paragraph 3 of the Statement of Claim. The total of the invoiced amounts was $170,869.45. In its proposed further amended defence (Annexure A to these reasons), the defendant admits that the invoiced amounts were net of the 10% fee to which the defendant was entitled pursuant to clause 14.1(2) of the Equity Holders Agreement. There is a dispute as to what the daily rate was in relation to invoice 4831. The invoices were dated from July to October, 1999, and rendered to the defendant after 30th June, 1999.
  1. [6]
    The said Sale Agreement provided as follows:

“4. Purchase Price

4.1 Amount

The price payable for the Interests is $1,450,000.

4.2 Acknowledgment

The parties acknowledge the following:

  1. (a)
    the Purchase Price includes all amounts owed or owing by the Partnerships and the Companies to the Sellers for the period up to 30 June 1999, and, subject to Completion, the Sellers have no further entitlement to any distribution, profit or loss, claim or dividend of whatsoever kind from any of the Partnerships and Companies for the period ending 30 June 1999 or for the period up to and including Completion;
  1. (b)
    the Purchase Price includes all debts owing for the period ending 30 June 1999 by the Partnerships and Companies to any member of the Sellers and the Sellers shall have no further claim in relation to these debts;
  1. (c)
    the Purchase Price includes all or any of the assets (including the goodwill of Rushton Group Partnership but expressly excluding any goodwill associated with the trading of the Business in Queensland and Papua New Guinea) of the Partnerships and Companies and is also in consideration of the transfer of the Business Name under clause 9; and
  1. (d)
    prior to Completion all trading between the parties shall be performed in accordance with the Equity Holders Agreement.”
  1. [7]
    The plaintiff in its Statement of Claim contends as follows:
  1. “7.
  1. a)
    The Sale Agreement relevantly provided that any amounts due by the Plaintiff to the Defendant or vice versa in respect of the interstate referral work and the billing for the same as provided for by clause 14.1(1) of the Equity Holders Agreement and which sums were due for payment (ie had been invoiced) up to and including 30 June 1999 would be waived;
  2. b)
    The Sale Agreement did not provide for any such waiver of the liability for amounts invoiced by the Plaintiff to the Defendant at any time after 30 June 1999 pursuant to clause 4.1 (1) of the Equity Holders Agreement.
  1. 8.The Sale Agreement was completed on or about 6 December, 1999.
  2. 9.
  1. a)
    Subsequent to the entering into of the Sale Agreement, the Plaintiff by Mr Holzberger and the Defendant by Mr Rogan agreed to vary the Equity Holders Agreement so that the Plaintiff would withhold seeking payment of any of the amounts invoiced by it to the Defendant post 30 June 1999 and pursuant to clause 14.1(1) of the Equity Holders Agreement until such time as the Sale Agreement had been completed;
  2. b)
    The agreement referred to in paragraph 9(a) was:
  1. i)
    oral;
  2. ii)
    made between Mr. Holzberger and Mr Rogan on behalf of the Plaintiff and the Defendant respectively;
  3. iii)
    made during the course of a meeting between Mr Holzberger and Mr Rogan at the Grand Chancellor Hotel in Hobart, Tasmania and which took place on or about 24 October 1999
  1. 10.
  1. a)
    As pleaded in paragraph 3 above, the Plaintiff has rendered invoices to the Defendant for valuation work after 30 June 1999; and
  2. b)
    As pleaded in paragraph 8 above, the Sale Agreement was completed on or about 6 December, 1999.
  1. 11.In the premises (and particularly given the completion of the Sale Agreement) the invoiced amounts pleaded in paragraph 3 above became due and payable by the Defendant to the Plaintiff immediately following the completion of the Settlement Agreement (i.e. on 7 December 1999).”
  1. [8]
    The plaintiff alleges in paragraph 6 of its Statement of Claim that an agreement was reached on 22 October 1999 as evidenced by the Sale Agreement. In Annexure “A” the defendants pleads in response:             

  “ As to paragraph 6 of the statement of claim:

  1. (a)
    The defendant admits that the discussions referred to in paragraph 5 of the statement of claim resulted in an agreement (“the Agreement”) between the plaintiff and the defendant;
  2. (b)
    The defendant denies that the Agreement is contained in the document entitled “Sale of Business Interests Agreement” on the grounds that:-
  1. (i)
    the defendant did not execute that document; and
  2. (ii)
    the Sale of Business Interests Agreement does not accurately record the Agreement in certain material respects.
  1. 6A.The Agreement was oral and was reached in the discussions constituted by the negotiations which took place at the offices of Freehill Hollingdale and page on 21 and 22 October 1999 between, inter alia, Peter Rogan, David Reichenberg, Sonya Kilkenny, Craig Finlayson and John Hutchinson (all of Freehill Hollingdale and Page) and Ian Hanley on behalf of the defendant, and Phillip Holzberger, Tony Bennett, (of Bennett and Philp) and Phillip Stewart on behalf of the plaintiff.
  2. 6B.The terms of the Agreement, so far as they are material , were as follows:
  1. (a)
    The defendant would perform any acts necessary to allow the Sale of Business Interests Agreement to be completed, including executing a deed of termination for the Equity Holders Agreement;
  2. (b)
    The purchase price paid by the Buyer ( as this term is defined in the Sale of Business Interests Agreement) under the Sale of Business Interests Agreement would include all work performed by the plaintiff for the defendant up to and including 30 June 1999, including un-invoiced  work in progress and invoiced work;
  3. (c)
    Upon completion of the Sale of Business Interests Agreement, the defendant would be released from any and all liability in respect of all work performed by the plaintiff for clients of the defendant up to and including 30 June 1999, including un-invoiced work in progress and invoiced work.”.

Application to adjourn trial

  1. [9]
    This matter was set down for trial on 18th July, 2000, for five (5) days to commence on 4th December, 2000.  On 28th November, 2000, an application to adjourn the trial was refused.  The reasons appear in a judgment delivered on that day.  Messrs. Freehills had been acting for the defendant throughout  the case management of this action.  The case management had commenced on 8th May, 2000.  The defendant was granted leave to make substantial amendments to the defence on 7th June, 2000.  Those amendments appear in the document filed on 14th June, 2000.  That was the relevant pleading up until 5th December, 2000, when the defence sought to further amend the defence.  Some of the amendments have been referred to in paragraphs 6 and 6A above:  Annexure “A”. 
  1. [10]
    It was inferred in the reasons given on 28th November, 2000, that Freehills had not prepared the case in compliance with the orders made for delivery of affidavits by 1st December, 2000, as they had not been paid some $80,000.00 in fees.  The defendant had already paid some $50,000.000.  Mr. Rogan deposed in an affidavit sworn on 28th November, 2000, and 4th December, 2000, that:
  1. since 25th July, 2000 he had been concerned about the level of fees rendered by Freehills
  2. he had had discussions from two firms of solicitors in relation to this action (para 6), although he had approved the amended defence and counter claim.
  3. that all defences have not been raised.
  4. that he had been aware since late July that the matter was set down for trial for five days from 4th December.
  5. That some 12 witnesses would have to be called.  These witnesses included persons from both Freehills and the plaintiff’s present solicitors. The proposed further amended pleading was not available on 28th November.
  6. That from July, 2000 to October, 2000. He had had a number of conversations with his solicitors about whether the defence had been properly pleaded.
  7. Mr. Rogan alleged that Freehills had been dilatory in relation to the conduct of the defence.  There was a stand off as their fees had not been paid.
  8. Messrs. Minter Ellison were instructed to seek the adjournment on 28th November, and now the defendant is represented by Messrs Macrossans.
  9. The defendant is prepared to provide security for the plaintiff’s costs thrown away by the adjournment.
  1. [11]
    It is not suggested that the plaintiff has suffered some any prejudice save that it is being held out from having its case heard. Its witnesses are available and were ready to proceed on Monday, 4th December.  The defendant’s legal advisors were given time to draft the proposed amendment and allow the plaintiff to consider its position.  The plaintiff opposed the proposed further amendment to the pleading. 

Principles to be applied

  1. [12]
    Reference was made in the reasons given on 28th November, 2000, to the decision of the Queensland Court of Appeal in Rigato Farms Pty. Ltd. V. Ridolfi Appeal No. 11448 of 1999 an unreported decision given on 28th July, 2000.  That case involved an application to withdraw an admission of liability in a master servant action.  A notice to admit facts was given pursuant to rule 189 of the Uniform Civil Procedure Rules (UCPR).  There was a failure to respond by the defendant's then solicitors.  New solicitors were retained.  An application to withdraw the admission was made at the outset of the trial.  The application was refused.  The following principles can be gleaned from that decision:
  1. A judgment given on a practice and procedure application is of a discretionary character (p. 4)
  2. Parties do not have an inalienable right to a hearing of all issues on the merits.  Rule 5(3) confirms each party’s obligation to proceed expeditiously, or risk the sanctions which may include dismissal (rule 5(4)).
  3. If important provisions of the rules are ignored, the court cannot be expected to act indulgently and rectify omissions (p. 6).
  4. Rulings which reflect the philosophy of the UCPR and which may be robust should not be “subjected to a pedantic or overly intrusive re-examination” (p. 6).
  5. Where the detriment or prejudice is self induced, the party may not be entitled to relief (per Williams J at p. 8).
  1. [13]
    Reference had been made by the defendant’s then solicitor, Mr. McCormick, that the decision in Queensland v J.L. Holdings Pty. Ltd. (1996-1997) 189 CLR 146 was applicable.  In that case, the parties were also involved in a commercial dispute which was being case managed.  The trial was estimated to go for four (4) months.  There had been various interlocutory hearings and several amendments to the defence.  The judge who was case managing the action refused an amendment where it was likely that the trial date would be vacated if it were allowed.  It was held that while case management principles were a relevant consideration, they could not be used to prevent a party from litigating an issue which was fairly arguable.  It was further held that a party should be permitted to raise an arguable defence provided any prejudice to other parties could be compensated by costs.  The facts in that case were quite different to the present case.  The application to amend was made before a date was fixed for hearing (op. cit. p.154).  In the present case, the amendment was not formulated until the day after the trial was to commence.  The plaintiff advisors objected to the amendment as it would have necessitated an adjournment of the trial which had been fixed for five (5) months.  The nature of the amendment in J.L. Holdings, according to the applicant, was made to avoid taking the other side by surprise, even though it was apparent o the documents. 

Facts in present case

  1. [14]
    In the present case the proposed amendment is an attempt to avoid the parol evidence rule. The Sale Agreement was a document settled upon after extensive negotiations over some days between the parties and their legal representatives. In such cases, there is a presumption that the terms and conditions of the agreement are reflected in the written document: Nemeth v Bayswater Road Pty. Ltd. (1988) 2 Qd.R. 406, 417.  See also clause 20.12 of the Sales Agreement.  In this context, the statement in Cohen v McWilliam (1995) 38 NSWLR 476, 479G-480A is relevant. The defendant says that it was not a party to the Sales Agreement (Affidavit of Mr Holzberger sworn 30 November 2000 paras. 18, 24 and 40) and that a separate oral agreement was made between it and the plaintiff.  This amendment is separate from the alternative construction point urged by the plaintiff as the correct approach in the matter.  The plaintiff contends that the defendant is bound by the Sales Agreement as it received the benefit of same.  It is not necessary on this application to decide the main issue.  The question for determination is whether the defendant ought to be allowed to amend at this point in time.  The trial can commence today or tomorrow on the original pleadings as far as the plaintiff is concerned.
  1. [15]
    The defendant had had ample opportunity to settle its argument in relation to fees with its former solicitors, Freehills. I am satisfied that the fact that this case has not been prepared is that the defendant failed to provide the necessary funding. It was a conscious decision by the defendant which was self induced. There is no material before me which would suggest that the defendant was not in a position to provide such funding or to provide adequate security to its former solicitors. The plaintiff has provided detailed affidavit material pursuant to orders made by the court in order to shorten the hearing time. The defendant has chosen not to give effect to those orders made initially on 13th September, 2000. The time was extended to last Friday to suit the convenience of the defendant.  The defendant was given a further opportunity to rebut the inference which I drew on 28th November that the substantial reason for Freehills not preparing for trial was that the defendant had not paid the outstanding fees.  No further evidence was put before the court on that point except that the defendant now contends he raised questions in relation to the defence but no detail is given.
  1. [16]
    In the amended defence filed on 14th June, 2000, the defendant pleads the following:
  1. “7.
  1. a)
    The defendant denies each and every allegation in paragraph 7(a) on the basis that it is an inaccurate construction and says further that the Sale Agreement provided in clause 4.2 that:
  1. ‘(a)
    The Purchase Price includes all amounts owed or owing by the Partnerships and the Companies to the Sellers for the period up to 30 June 1999, and subject to Completion, the Sellers have no further entitlement to any distribution, profit or loss, claim or dividend of whatsoever kind from any of the Partnerships and Companies for the period ending 30 June 1999 or for the period up to and including Completion;
  2. (b)
    The Purchase Price includes all debts owing for the period ending 30 June 1999 by the Partnerships and Companies to any member of the Sellers and the Sellers shall have no further claim in relation to these debts.’
  1. 7.
  1. b)
    The defendant denies each and every allegation in paragraph 7(b) on the basis that it is an inaccurate construction and says further that the Sale Agreement provided that:
  1. (1)
    if and to the extent that there were any debts owing to the plaintiff at 30 June 1999 (which is denied) those debts were debts by reason of work in progress conducted by the plaintiff for, inter alia, the defendant which were to be satisfied, released and discharged upon payment of the purchase price by the entities described in the Sale Agreement as the Rogan Group to the plaintiff and other associated entities of the plaintiff, namely, Senmead Pty Ltd           and Philip Holzberger…”
  1. [17]
    Background evidence is admissible to establish the factual matrix of the Sales Agreement: Codelfa Constructions Pty. Ltd. v. State Rail Authority of NSW (1982) 149 CLR 337 at 352.  If objection is taken to other extrinsic evidence, then the appropriate course  may be to take the evidence subject to any objection as to what use should be made of it: Nemeth v Bayswater Road Pty. Ltd. (1988) 2 Qd.R. 406. The proposed further amendment relies on an oral agreement apart from the Sales Agreement.  It also in a more direct way states that the defendant was not a party to the Sales Agreement.  The plaintiff is prepared to meet that suggestion which was pleaded in a subtle way in paragraph 6 of the pleading filed in June.  If the substantial amendments in paragraphs 6,6A, 6B, 7 and 9 are allowed, the action cannot proceed as many more witnesses will have to be proofed and further discovery will be necessary on the part of the defendant.  The plaintiff has included the relevant background material in its affidavit material.  The background evidence can be explored, if necessary, by the defence.  The plaintiff’s primary position is that it is a case of the construction of clause 4 of the Sales Agreement.
  1. [18]
    As pointed out by counsel for the plaintiff in his written submissions delivered this morning, the defendant does not condescend to particulars and explain with any precision how it is that justice requires the amendments proposed. Mr. Bowden talks of the “withdrawal of the admission”. This may be a reference to that later pleading that the defendant denies it is a party to the Sales Agreement. However, as mentioned, that point was referred to in a subtle way in the original pleading. What is of greater importance, I find, is that the pleadings by the defendant seem to have evolved as time has passed. The present amendments have changed the nature of the defendant’s case substantially. The previous amendments may be relevant in the cross examination of the defence witnesses. It is not proposed to deal with that aspect in any detail in these reasons. What Mr. Bowden then submits is that the Mr. Rogan does not explain in any cogent way how it is that his previous solicitors misunderstood his instructions. Mr. Rogan does depose to the fact that he approved the amended pleadings (affidavit sworn 28th November, 2000, paragraph 7).  He submits that the material does not refer to any conversations with the necessary precision to justify or support the amendments now proposed.  I accept those submissions.  In light of the Rigato Farms  case, a failure to explain such matters is another factor to be taken into account (op. cit. pp. 5-6).
  1. [19]
    In light of the matters discussed, and applying the principles referred to in the Rigato Farms case, the application to further amend the Amended Defence filed on 14th June, 2000, is refused.  It is ordered that the defendant do pay the plaintiff’s costs occasioned by the application and the delay of the commencement of the trial to be assessed.
Close

Editorial Notes

  • Published Case Name:

    Rushton (Qld) P/L v Rushton

  • Shortened Case Name:

    Rushton (Qld) Pty Ltd v Rushton (NSW) Pty Ltd

  • MNC:

    [2000] QDC 334

  • Court:

    QDC

  • Judge(s):

    Forde DCJ

  • Date:

    07 Dec 2000

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited

Case NameFull CitationFrequency
Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 C.L R. 337
2 citations
Jump To
Cite 1 - (1982) 149 C.L R. 337
Cite 2 - (1982) 149 C.L R. 337
Cohen v McWilliam (1995) 38 NSWLR 476
2 citations
Jump To
Cite 1 - (1995) 38 NSWLR 476
Cite 2 - (1995) 38 NSWLR 476
Nemeth v Bayswater Road Pty Ltd [1988] 2 Qd R 406
3 citations
Jump To
Cite 1 - [1988] 2 Qd R 406
Cite 2 - [1988] 2 Qd R 406
Cite 3 - [1988] 2 Qd R 406
Ridolfi v Rigato Farms Pty Ltd[2001] 2 Qd R 455; [2000] QCA 292
2 citations
Jump To
Cite 1 - [2000] QCA 292
Cite 2 - [2000] QCA 292
State of Queensland v J L Holdings Pty Limited (1997) 189 CLR 146
1 citation
Jump To
Cite 1 - (1997) 189 CLR 146

Cases Citing

No judgments on Queensland Judgments cite this judgment.

1

Require Technical Assistance?

Message sent!

Thanks for reaching out! Someone from our team will get back to you soon.

Message not sent!

Something went wrong. Please try again.