O'Connell-Delaney Pty Ltd v Van Staden
[2012] QDC 153
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- Unreported Judgment
- O'Connell-Delaney Pty Ltd v Van Staden[2012] QDC 153
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O'Connell-Delaney Pty Ltd v Van Staden[2012] QDC 153
O'Connell-Delaney Pty Ltd v Van Staden[2012] QDC 153
DISTRICT COURT OF QUEENSLAND
CITATION: | O'Connell-Delaney Pty Ltd as trustee for The O'Connell-Delaney Family Trust v Van Staden & Ors [2012] QDC 153 |
PARTIES: | O'CONNELL-DELANEY PTY LTD (ACN 120 249 498) ATF THE O'CONNELL-DELANEY FAMILY TRUST (plaintiff) v JACOBUS FREDERIK VAN STADEN (first defendant) and JACOBUS FREDERIK VAN STADEN ATF THE VAN STADEN FAMILY TRUST (ABN 34 171 808 543) (second defendant) and RUDI INTERNATIONAL PTY LTD (ACN 104 101 617) (third defendant) and COMAX INTERNATIONAL PTY LTD (ACN 115 065 917) (fourth defendant) and COBUS FORBES INTERNATIONAL PTY LTD (ACN 147 939 295) (fifth defendant) |
FILE NO: | 4474/2011 |
DIVISION: | Civil |
PROCEEDING: | Application |
ORIGINATING COURT: | Brisbane |
DELIVERED ON: | 5 July 2012 (orders) 6 July 2012 (reasons) |
DELIVERED AT: | Brisbane |
HEARING DATE: | 5 July 2012 |
JUDGE: | Long SC, DCJ |
ORDER: |
|
CATCHWORDS: | CONTRACT – BREACH – DAMAGES – where the plaintiff seeks an assessment of damages pursuant to default judgments entered by the Registrar conditional on assessment of damages by the Court – where the defendants did not appear on the application – whether it is appropriate to hear evidence by affidavit – where damages assessed in accordance with the terms of the breached agreement, being an agreement in settlement of a dispute relating to a business venture. TRADE AND COMMERCE - MISLEADING AND DECEPTIVE CONDUCT – LOSS AND DAMAGE - where the plaintiff seeks an assessment of damages pursuant to default judgments entered by the Registrar – where the defendants did not appear on the application – whether it is appropriate to hear evidence by affidavit – where damages assessed under s 236 of schedule 2 to the Competition and Consumer Act 2010 (Cth), as an appropriate measure of putting the claimant into the position it would have been but for the contravening conduct. |
COUNSEL: | L. Clark on behalf of the applicant. No appearance on behalf of the respondents. |
SOLICITORS: | See Well Lawyers on behalf of the applicant. No appearance on behalf of the respondents. |
Introduction
- [1]On 5 July 2012 this matter came before the court for assessment of damages, consequently upon default judgments having issued against each of the first to fifth defendants, on 17 April 2012, conditional on damages being assessed by this court. The orders then made were that:
- The plaintiffs damages in respect of the default judgments issued by the Court against each of the first to fifth defendants on 17 April 2012 are assessed in the sum of $159,726.85 (inclusive of an amount of $13,932.30 as interest); and
- The plaintiff’s costs of the proceeding are fixed in the sum of $9,995.10.
- [2]By its claim and statement of claim[1], the plaintiff sought damages from each of the abovenamed defendants upon causes of action that included breach of contract (being an agreement called “the partnership cancellation agreement”) and for misleading and deceptive conduct contrary to the Competition and Consumer Act 2010 (Cth).
- [3]On the hearing, the plaintiff was granted leave to read and file an affidavit of service[2] in order to comply with UCPR 509(3). Despite the notification of the hearing date for the assessment of damages on the default judgments to each defendant, none of them appeared at the hearing.
- [4]
Basis of the assessment
- [5]As the plaintiff’s claim was for unliquidated damages, the default judgments were issued conditionally upon the assessment of damages by this court. The default judgments establish each defendant’s liability to pay damages to the plaintiff in an amount to be assessed and by the making of default in defending, each defendant is taken to admit the allegations as to liability made in the plaintiff’s statement of claim.[5]
- [6]The relevant circumstances or facts are conveniently summarised in the following extract from the plaintiff’s outline of submissions[6]:
“6. In or about September 2010, during discussions between representatives of the plaintiff and Mr Van Staden in September 2010, Mr Van Staden offered the plaintiff an opportunity to purchase a one half share in his service station business for the sum of $250,000.
- 7.During the discussions, Mr Van Staden made a number of representations to the plaintiff including the following:
- (a)That the service station had previously had a fuel supply contract with Mobil Oil;
- (b)That he was negotiating with BP Australia in order to conclude a new fuel supply contract;
- (c)That he was also negotiating with a Hungry Jacks’ franchisor to put a Hungry Jacks store at the same location as the service station; and
- (d)That if the plaintiff purchased the one half share, it could expect to receive substantial profit and future income (as set out in more detail at sub-paragraph 3(e)-(k) of the statement of claim).
- 8.At the time of those representations, Mr Staden was trustee of his family trust and a director of the third, fourth and fifth defendants and the representations were made on their behalf.
- 9.It was intended that the third defendant, Rudi International Pty Ltd, would be the company through which the intended partnership would operate.
- 10.The fifth defendant Cobus Forbes International, was at material times the freehold owner of the land on which the service station is located as well as the owner of the service station business.
- 11.The fourth defendant Comax International, held a leasehold interest from the fifth defendant in the service station.
- 12.On or about 28 January 2011, the plaintiff entered into an agreement with the first defendant, for and on behalf of the second defendant. The agreement had terms that included:
- (a)That the plaintiff would pay to the first defendant the sum of $250,000; and
- (b)That the partnership would be operated by the third defendant.
- 13.The partnership agreement was entered into by the first defendant for and on behalf of himself and the second to fifth defendants.
- 14.Following entry into the partnership agreement, in the period November 2010 to February 2011, the plaintiff paid the sum of $150,000 as follows:
- (a)$110,000 to the fourth defendant;
- (b)$10,000 to the first defendant; and
- (c)$30,000 to the fourth defendant.
- 15.Following payment of these sums, the representations made by the first defendant referred to above were shown to be false.
- 16.On 25 July 2011, the plaintiff entered into a further agreement with the first defendant called the partnership cancellation agreement.
- 17.The partnership cancellation agreement was entered into by the first defendant for and on behalf of himself and the second to fifth defendants.
- 18.By that agreement, the first defendant agreed to pay to the plaintiff $159,294.55.
- 19.A first instalment of $7,500 was to be paid by 26 July 2011.
- 20.A second and final instalment of $151,794.55 was to be paid by 31 August 2011.
- 21.On 7 September 2011 the plaintiff was paid by the first defendant the sum of $13,500.
- 22.No further payment has been made to the plaintiff by the first defendant or the second to fifth defendants.”
- [7]Against this background it is necessary to understand that it was specifically alleged in the statement of claim that at all material times the first defendant acted for and on behalf of himself and each of the second to fifth defendants, as entities that were necessarily interested in and to be involved in the performance of the partnership agreement. During the relevant period the first defendant was the only director and shareholder of the third and fourth defendants.[7] The only additional shareholding is in the fourth defendant by the third defendant.[8] Until 4 January 2011 the first defendant was the only director of the fifth defendant and until a change of membership recorded with effect from 27 January 2011, also the only shareholder.[9]
- [8]As contended by the plaintiff, the general rule at common law is that damages for breach of contract are to be awarded on the basis of placing the claimant in the same position as if the contract had been performed.[10]
- [9]Whilst it is contended that the allegation in the Statement of Claim that at all material times the first defendant acted for and on behalf of himself and each of the second to fifth defendants and the consideration that each were entities that were necessarily interested in and to be involved in the performance of the partnership agreement, was a sufficient basis for concluding that the third, fourth and fifth defendant were also bound by the partnership separation agreement notwithstanding that none of these defendants were expressly referred to in that agreement and did not execute it, the liability of these defendants, as established by the default judgment entered against each of them, also includes that pursuant to s 236 of schedule 2 to the Competition and Consumer Act 2010 (Cth), which relevantly provides:
“(1)If:
- (a)A person (the claimant) suffers loss or damage because of the conduct of another person; and
- (b)The conduct contravened a provision of chapter 2 or 3;
- (c)The claimant may recover the amount of loss or damage against that person or against any person involved in the contravention.”
- [10]That schedule, defined as the Australian Consumer Law in s 4 of that Act, is made referrable to contraventions, by corporations, such as that alleged here[11], by s 131 of that Act. Further, it has been recognised that the section is to be broadly construed and contains no stated limitation on the kinds of loss and damage that may be recovered under the section and that a recognised approach may be to award damages on the basis of putting a claimant in the position it would have been, but for the contravening conduct.[12]
- [11]Accordingly and although there may, in other circumstances, be a need to separately assess the damages under each cause of action, for the reasons that follow that is not practically necessary here.
Assessment
- [12]The damages for the breach of the partnership cancellation agreement are simply assessed by reference to what was agreed to be paid to the plaintiff pursuant to that agreement. That is the amount of $159,294.55, less the only amount paid subsequently to that agreement, being the amount of $13,500.00 paid on 7 September 2011, being an amount of $145,794.55.
- [13]Subject to the assessment of an appropriate allowance for damages by way of interest[13] that figure would also provide an appropriate point of reference (by way of assessment of the parties of an appropriate measure of damage) for the purposes of any damages that might be awarded pursuant to s 236 of the Competition and Consumer Act. This is because the effect of the partnership cancellation agreement was to put the applicant back into what was then considered to be its position but for the contravening conduct and because this was all that was sought by the applicant.
- [14]In the circumstances it is appropriate to also allow for interest, as claimed by the applicant, to the date of judgment, by reference to the rate provided under practice direction for default judgments and by reference to a period commencing with the first default under the partnership cancellation agreement[14] and taking account of the payment made on 7 September 2011. The appropriate calculation is set out in a schedule exhibited to the affidavit of Mr O'Connell[15] and amounts to $13,932.30.
- [15]Costs were sought in a fixed amount of $9,995.10 as set out in a schedule of fees that might reasonably have been assessed on the standard basis and as an exhibit to the affidavit of Ms Ryan.[16] The awarding of fixed costs is allowed under UCPR 685(2) and also encouraged in accordance with practice direction 3 of 2007. The materials provided in Ms Ryan’s affidavit indicate that the amount sought is a just amount and it is therefore appropriate to make the order sought.
Footnotes
[1] Filed on 7 November 2011.
[2] Affidavit of T Ahmajani, sworn 3 July 2012.
[3] See UCPR 390 and 367(3)(d).
[4] See Yuruga Nursery Pty Ltd v Australian Tree Management Ltd [2000] QSC 210 and Hunter v Kitagawa [2010] QDC 430.
[5]Parkville Court Pty Ltd v Salvaris [1975] VR 393 at 395; Watson Specialised Tooling Pty Ltd v Stevens [1991] 1 Qd R 85 at 93-4.
[6] Which are in turn referable to the evidence given and materials read on the assessment hearing.
[7] Affidavit of Paul Maurice O'Connell, sworn 4 July 2012, para 7 and 8, Exhibits “PMO-4” and “PMO-5”.
[8] Affidavit of Paul Maurice O'Connell, sworn 4 July 2012, Exhibit “PMO-5”.
[9] Affidavit of Paul Maurice O'Connell, sworn 4 July 2012, para 9, Exhibit “PMO-6”.
[10]Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64 at 80; Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494 at 503.
[11] As being a contravention of s 18 in Chapter 2 of Schedule 2, by misleading and deceptive conduct.
[12]Gates v City Mutual Life Assurance Society Limited (1986) 160 CLR 1; Murphy v Overton Investments Pty Ltd (2004) 216 CLR 388.
[13] See Hungerfords v Walker (1990) 171 CLR 125.
[14] Which required an amount of $7,500 to be paid on or before the close of business on 26 July 2011.
[15] Affidavit of P M O'Connell filed by leave on 5 July 2011; Exhibit PMO-11.
[16] Affidavit of A M Ryan filed by leave on 5 July 2011; Exhibit AMR-02.