Zinjune Pty Ltd v Coglan[2007] QDC 144

DISTRICT COURT OF QUEENSLAND

1. [1]
   The defendants have applied for summary judgment pursuant to r 293 Uniform Civil Procedure Rules 1999 (UCPR).  The application requires a consideration of whether:

1. (a)
   the plaintiff has no real prospect of succeeding on all or a part of its claim; and

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

2. [2]
   In Deputy Commissioner of Taxation v Salcedo^[1] Williams JA said:

“That review of the authorities clearly establishes to my mind that there has been a significant change brought about by the implementation of r. 292 and r. 293 of the UCPR.  The test for summary judgment is different, and the court must apply the words found in the rule.  To use other language to define the test (as was contended for in this case by counsel for the appellant relying on the reasoning of Chesterman J. in Gray v. Morris) only diverts the decision-maker from the relevant considerations.  But, and this underlies all that is contained in the UCPR, ultimately the rules are there to facilitate the fair and just resolution of the matters in dispute.  Summary judgment will not be obtained as a matter of course and the judge determining such an application is essentially called upon to determine whether the respondent to the application has established some real prospect of succeeding at a trial; if that is established then the matter must go to trial.  In my view, the observations on summary judgment made by the judges of the High Court in Fancourt v. Mercantile Credits Ltd (1983) 154 CLR 87 at 99 are not incompatible with that application of r. 292 and r. 293; what is important is that in following the broad principle laid down by their Honours the test as defined by the rules is applied.”^[2]

3. [3]
   By claim filed 19 January 2005, the plaintiff claims damages of $200,000 for:

• Breaches of ss 52 and 53 Trade Practices Act 1974 (“TPA”)

• Negligence or negligent mis-statement

• Breach of contract

4. [4]
   There is an alternative claim for specific performance.

5. [5]
   The relevant factual background is not in dispute. In or about June 2003 the defendants marketed and offered for sale proposed allotments in the Golden Sands Beach Estate at Moore Park. The proposed allotments were contained in drawing number 15535^[3].  It was a requirement of s 8 Land Sales Act 1984 (“LSA”) that there be in existence an approval of the engineering drawings and specifications for the works required by the conditions of the approval for the proposed subdivision.  It is common ground that such an approval did not exist in or about June 2003 when the plaintiff, as purchaser, “entered upon” the contracts.  The defendants, as sellers, executed contracts on 18 July 2003 for the sale of Lots 53 and 54.  It is common ground that contracts did not then come into existence because s 8(2) LSA renders such contracts void because there was not then, in existence, an approval of the engineering drawings and specifications for the works required by the conditions of the approval for the proposed subdivision.

6. [6]
   The contracts contained a condition that the plan of subdivision creating the proposed Lots 53 and 54 be registered by 18 January 2004. It is common ground that the plan for reconfiguration was not registered by that date. By letter dated 20 January 2004 the defendants, as sellers, purported to terminate the contract.

7. [7]
   The nature of the plaintiff’s claim pursuant to the TPA is that:

• By sending proposed contracts for the sale of land by mail to the plaintiff, the defendants made certain representations that are outlined in para 12 of the statement of claim.  The plaintiff relies upon the use of the postal service so as to engage the operation of the TPA against the defendants, who are individuals.  Otherwise the relevant provisions of the TPA apply only to corporations^[4].

• The plaintiff relied upon those representations and entered into the contracts (para 13(a) statement of claim).

• The representations were misleading and contravened the TPA.

• The plaintiff thereby suffered loss because they did not obtain the anticipated or actual increase in the value of the land.

8. [8]
   Mr Lilley SC for the defendants submits that the mere posting of an unexecuted contract is no more than a representation of a present intention to consider an offer to purchase.  He submits that the representations relate to a present state of mind as to a legal entitlement when the contracts were submitted.

9. [9]
   Notwithstanding the thorough and helpful submissions of Mr Lilley SC, I am not persuaded that the plaintiff’s claim pursuant to the TPA is so untenable that it should be dismissed in a summary way.  However, I accept that the case as pleaded is unsatisfactory and I would strike out paras 2(d), 12(a), (c), (d) and (e), 14, 15, 16, 17 and 18 of the statement of claim.  I would allow the plaintiff 28 days to re-plead its claim pursuant to the TPA.
10. [10]
    The plaintiff’s claim for negligence contends that the defendants as sellers owed a duty to the plaintiff to exercise the reasonable care and skill of a land developer, particularly in relation to information and advice provided to persons in the position of the plaintiff.
11. [11]
    The statement of claim does not plead that the defendants gave any advice or information to the plaintiff.  It is not pleaded that the plaintiff relied on any information or advice given by the defendants.  All that is said is that the defendants’ agent posted unexecuted contracts to the plaintiff.
12. [12]
    The plaintiff’s claim is for pure economic loss.  Mr Lee for the plaintiff did not cite any authority to support the proposition that the defendants owed the plaintiff a duty of care to avoid economic loss.  There is no suggestion that the plaintiff was particularly vulnerable^[5].  Indeed para 5(c) of the statement of claim pleads that the plaintiff appointed a firm of solicitors to act on its behalf.
13. [13]
    The negligence claim cannot be sustained and must be dismissed.
14. [14]
    The plaintiff’s claim pleaded at para 22 of the statement of claim is that:

• The sellers obtained approval from the Burnett Shire Council of the engineering plans and drawings on or about 11 November 2003

• On and after 11 November 2003 the sellers were entitled at law to enter into valid contracts for the sale of the allotments.

• On or after 11 November 2003 the sellers and the plaintiff, by their conduct, and as a consequence of the silence and acquiescence of the parties, entered into further contracts for the sale of Lots 53 and 54 and adopted the terms and conditions set out in the contracts dated 18 July 2003.

15. [15]
    The contracts for the sale of Lots 53 and 54 dated 18 July 2003 were void^[6].  Mr Lilley SC relies upon the decision of White J in Re Rosemac Pty Ltd’s Caveat^[7] to support the contention that the void contract could not be revived.  Despite being afforded the opportunity to do so, Mr Lee for the plaintiff was unable to cite any authority to the contrary.

16. [16]
    There is no doubt that the decision of White J is correct.

17. [17]
    The plaintiff’s claim for damages for breach of contract must also be dismissed. It follows that the claim for specific performance must be dismissed.

18. [18]
    The plaintiff should pay the defendants’ costs to be assessed.

19. [19]
    It was agreed that in these circumstances the plaintiff’s application for disclosure should be dismissed.

20. [20]
    The orders are:

1. Defendants’ application for summary judgment in respect of plaintiff’s claim pursuant to the Trade Practices Act 1974 is dismissed.

2. Strike out paras 2(d), 12(a), (c), (d), (e), 14, 15, 16, 17 and 18 of the Statement of Claim.

3. Give the plaintiff 28 days to re-plead its claim pursuant to the Trade Practices Act 1974.

4. If the plaintiff does not re-plead its claim pursuant to the Trade Practices Act 1974 the defendant has liberty to apply.

5. The defendants’ application for summary judgment in respect of the plaintiff’s claim for negligence and breach of contract is granted.

6. The plaintiff’s claim for damages for negligence or negligent mis-statement is dismissed.

7. The plaintiff’s claim for damages for breach of contract, breach of warranty and breach of good faith is dismissed.

8. The plaintiff’s claim for specific performance is dismissed.

9. The plaintiff is to pay the defendants’ costs of the application and the defendants’ costs thrown away consequent upon the plaintiff having leave to re-plead.  The plaintiff is to pay the defendants’ costs of the proceeding in respect of the issues of negligence and breach of contract.

10. Plaintiff’s application for disclosure is dismissed with costs.