Landmark Operations Ltd v McKenzie
[2017] QDC 20
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- Unreported Judgment
- Landmark Operations Ltd v McKenzie[2017] QDC 20
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Landmark Operations Ltd v McKenzie[2017] QDC 20
Landmark Operations Ltd v McKenzie[2017] QDC 20
DISTRICT COURT OF QUEENSLAND
CITATION: | Landmark Operations Ltd v McKenzie [2017] QDC 20 |
PARTIES: | LANDMARK OPERATIONS LTD v GRAHAM ALEXANDER MCKENZIE |
FILE NO/S: | D282/2017 |
DIVISION: |
|
PROCEEDING: | Originating application |
ORIGINATING COURT: | District Court at Brisbane |
DELIVERED ON: | 8 February 2017 |
DELIVERED AT: | Brisbane |
HEARING DATE: | (application without oral hearing) |
JUDGE: | McGill SC DCJ |
ORDER: | Application adjourned. |
CATCHWORDS: | DISCOVERY AND INTERROGATORIES – Interrogatories – pre-proceeding interrogatories – whether jurisdiction to order – whether appropriate – whether another better mode of proof available. UCPR r 229(1)(b). Cape Australian Holdings Pty Ltd v Iannello [2009] FCA 709 – distinguished. Moneywood Pty Ltd v Salamon Nominees Pty Ltd (2001) 202 CLR 351 – cited. Moran v Hull [1967] 1 NSWR 723 – cited. Pacific Century Production Pty Ltd v Netafim Australia Pty Ltd [2004] 2 Qd R 422 – considered. Tremco Pty Ltd v Cadoe Pty Ltd [2013] QDC 273 – cited. Wilkinson v Wilkinson [2009] QSC 191 – considered. |
COUNSEL: | Neither party was represented by counsel |
SOLICITORS: | Thynne & Macartney for the applicant The respondent was not represented |
- [1]This is an application for leave to deliver interrogatories in the unusual situation where there is no proceeding pending between the parties, and where the interrogatories are sought to be delivered to help the applicant decide whether the respondent would be an appropriate party to a proposed proceeding. Such an application is within UCPR r 229(1)(b). Pursuant to r 230(1)(a) the order may be made on application without notice to another person, relevantly the respondent, and under subrule (1)(b), leave can be given only if I am satisfied there is not likely to be available to the applicant at the trial another reasonably simple and inexpensive way of proving the matter sought to be elicited by interrogatory. The application was accompanied by a draft of the proposed interrogatories.
- [2]For reasons I will set out later, there are difficulties with the proposed order and I am not, at this stage, prepared to make an order. I will however adjourn the application to a date to be fixed to enable the applicant to consider these reasons and to make further submissions or to put further material before the court.
Jurisdiction
- [3]On the face of it, r 229 gives the District Court power to make an order in a situation like this. However, the District Court as an inferior court only has jurisdiction in those matters conferred upon it by statute. There are a number of other relevant statutes which can give jurisdiction, but civil jurisdiction is mainly conferred on the District Court by the District Court of Queensland Act 1967 s 68. That section sets out a number of matters which the District Court has jurisdiction to hear and determine. The present application does not appear to come within any of them.
- [4]Ordinarily for the jurisdiction of the District Court to be properly invoked it is necessary for the plaintiff or applicant to claim some relief which is within s 68, unless some other specific statute is being relied upon. For example, an application in relation to the pre-litigation procedures under the Motor Accident Insurance Act 1994 s 50 can be brought in the District Court if the application is with respect to a claim that the court would have jurisdiction to hear and determine if a proceeding based on the claim had been brought: s 4, definition of “court”. But the mere fact that, if a proceeding were brought to recover the commission alleged by the applicant to be recoverable from the respondent, that claim would be one which could be brought in the District Court pursuant to s 68(1)(a) does not necessarily mean that the court has power prior to such a proceeding being commenced to make an order of this nature. This is an issue not dealt with in the submissions on behalf of the applicant, and I do not propose to make any decision about it without giving the applicant the opportunity to make any submissions about it.
Factual background
- [5]The applicant is a licensed real estate agent. On 19 November 2015 the respondent executed an appointment of the applicant as a real estate agent by signing a Form 6 under the Property Occupations Act 2014 in respect of certain freehold land which, as it happened, had considerable value. The agreement provided that the applicant was retained on an open listing, that is the agency was not exclusive, the appointment could be ended at any time by written notice, and “the agent is entitled to the agreed commission if he or she is the effective cause of sale”. On 31 May 2016 the applicant was sent an email by another real estate agent advising that it had been appointed pursuant to an exclusive agency, which the applicant treated as notice on behalf of the respondent terminating the open listing retainer under the Form 6.
- [6]Before that had happened, the applicant had identified a prospective purchaser of the land who was apparently introduced to the owner as a prospective purchaser.[1]On 15 December 2015 the agent met the prospective purchaser and together they inspected the relevant land. Subsequently, the agent provided the prospective purchaser with detailed information about the property, and on 22 January 2016 the prospective purchaser made an offer to purchase it for $8,500,000, which was communicated to the respondent and rejected by him. Further negotiation between the applicant and the prospective purchaser occurred, and the latter made a second offer to pay $9,000,000 for the property including certain chattels. That was communicated to the respondent who also rejected this offer, but gave instructions to make a counter-offer to the prospective purchaser.
- [7]Before that could be done, the prospective purchaser suffered an accident at home for which he required hospitalisation and surgery, which led to the suspension of negotiations with him. That I infer remained the case at the time when the plaintiff’s agency was terminated. A title search of the relevant land shows that a sale of it to a company associated with the prospective purchaser was completed on 11 July 2016, for a price which was slightly higher than the counter-offer referred to earlier; the applicant does not know the terms of that sale, other than the price. On 8 November 2016, the applicant, by its general counsel, wrote to the respondent asserting an entitlement to commission on the basis that the applicant introduced the purchaser to the respondent, and had progressed negotiations between the parties until they came to an end because of the prospective purchaser’s accident. It was asserted that the applicant was an effective cause of the subsequent sale, and payment of commission was demanded, otherwise the applicant would commence proceedings to recover it. There is no reference in the affidavit to any reply having been received to this letter.
Relevant law
- [8]The fact that the sale eventuated in the present case after the agency of the applicant was terminated, and after another agent had become involved, does not necessarily mean that the applicant is not entitled to commission; it depends on whether the applicant was an effective cause of the sale which ultimately resulted. See for example Moneywood Pty Ltd v Salamon Nominees Pty Ltd (2001) 202 CLR 351. There are many other cases which provide specific examples where courts have decided whether or not the action of the agent in first introducing the purchaser to the vendor and encouraging the purchaser’s interest meant that the agent was an effective cause of the sale which ultimately eventuated.
- [9]Rule 229 was considered in the context of pre-litigation interrogatories in Pacific Century Production Pty Ltd v Netafim Australia Pty Ltd [2004] 2 Qd R 422. In that case Douglas J discussed the history of the rule and similar rules in other jurisdictions, and ordered that the plaintiff have leave to deliver interrogatories to a prospective additional party to proceedings which had already been commenced. The person from whom the information was sought would not speak to the plaintiff or its solicitors about the matter [8], and indeed was involved in separate litigation with the plaintiff in the Magistrates Court in relation to wrongful dismissal: [7]. There was evidence that that person was the only person familiar with what had passed between the plaintiff and the existing defendant, which had filed a defence asserting that there had been things said to it by this person on behalf of the plaintiff which meant the defendant was not liable to the plaintiff in the existing proceeding.
- [10]Douglas J rejected an argument that interrogatories should not be delivered because an alternative way of proving the same matter would be to call the person concerned as a witness at the trial: [12]. His Honour held that in this context interrogatories could properly be used as a “fishing expedition”: [15]. He held that the power in the rule was one designed to enable identity and information discovery by the use of interrogatories: [22]. I note that in that matter the person to whom it was proposed to deliver the interrogatories was served and appeared and made submissions, which were ultimately rejected.
- [11]His Honour also made an order for pre-litigation interrogatories in Wilkinson v Wilkinson [2009] QSC 191. That was a matter where a previous dispute had been settled by an agreement between the parties, who were mother and daughter, but the applicant was concerned about whether the respondent had actually complied with her obligations under the settlement agreement. This was something which she could ascertain only from the respondent. Correspondence had failed to produce all of the information sought, and the applicant’s solicitors had even provided a draft set of interrogatories, which were not answered voluntarily by the respondent. In those circumstances an order was made, Douglas J accepting that the applicant needed the information sought in the interrogatories to determine whether to commence proceedings for breach of the settlement agreement.
- [12]The solicitors for the applicant also drew to my attention Cape Australian Holdings Pty Ltd v Iannello [2009] FCA 709, where an application under similar rules in the Federal Court was dismissed. In that matter the application failed on the basis that the applicant’s evidence did not show reasonable cause to believe that the applicant may have a right to obtain relief against the respondent in the way it claimed. The case turned on its particular facts, and it also seems to me that the relevant Federal Court rules are somewhat different. I was also referred to Tremco Pty Ltd v Cadoe Pty Ltd [2013] QDC 273, where another judge granted leave to deliver interrogatories inter partes on an ex parte application on the papers. Given the terms of r 230(1)(a), I accept that the application can properly be brought in this way.
Consideration
- [13]It was submitted for the applicant that the information sought by it was targeted and narrow in scope, and was information which was perhaps solely within the possession of the respondent. It was submitted that what was not known was the extent of the work done by the other agent after its engagement to facilitate the sale, the difference between the terms of sale negotiated by the applicant and the final sale that occurred, and whether the second agent separately sourced the same proposed purchaser, or whether it was informed by the respondent of his identity. One can see that all of these things would be relevant to the question of whether the applicant was an effective cause of the sale ultimately made by the respondent.
- [14]In relation to the first of them, however, the respondent is not the obvious source of information about what work the second agent did; the obvious source of information, particularly information which was not hearsay, is the second agent. The respondent can hardly be interrogated about everything this new agent did with a view to achieving a sale. There is one question in the draft interrogatories as follows:
“To the best of your knowledge, on or after the Ray White appointment date, what work was undertaken by Ray White to negotiate the terms of the contract to sell Junction Park as referred to in question 1?”
- [15]It occurs to me that there may be more involved in bringing about a sale than simply negotiating the terms of the contract.[2]The real difficulty here is that it may well be only the second agent who is in a position to prove the facts which would tend to show that the work done by the second agent was of such importance in bringing about the sale that ultimately occurred that the applicant could not be said to have been an effective cause of that sale, notwithstanding the initial introduction.
- [16]As to the second point, the difficulty here is that in substance what is sought is a copy of the contract of sale, which undoubtedly would have been in writing. The correct way to show what the terms of that contract were is to produce a copy of the contract, not to seek secondary evidence of its contents.
- [17]As to the third point, I can understand the applicant being concerned that, if the proposed purchaser was independently identified by the second agent as a prospective purchaser and contacted for that reason, the argument that the introduction of that proposed purchaser to the respondent was an effective cause of the sale that ultimately resulted is considerably weakened, if it does not disappear. It would therefore certainly be useful to know if the respondent provided the second agent with the identity of the prospective purchaser, though it occurs to me that it may be that the prospective purchaser got in touch with the new agent because, as a result of the earlier work by the applicant, he was interested in purchasing the property, and it was this which led to the sale which was completed, a situation where there would be at least an arguable case that the applicant was the effective cause of that sale. In those circumstances, it is an oversimplification to say that it all turns on whether the prospective purchaser’s identity was disclosed by the respondent to the second agent.
- [18]There is another matter which concerns me. In each of the two Supreme Court matters to which I have referred it appears that, prior to the application being made, there was an attempt to elicit the relevant information voluntarily from the respondent.[3]Apart from the rather aggressive letter of demand, there is no evidence of correspondence between the applicant and the respondent seeking the provision of this information voluntarily, and in those circumstances it is difficult for the applicant to show that there is not likely to be available another reasonably simple and inexpensive way of proving the matters sought to be elicited, namely by simply asking the respondent what the situation was.
- [19]Another matter which seems to me not to be dealt with by the present affidavit material is whether another reasonably simple and inexpensive way of proving the matters sought to be elicited is simply asking the second agent. It may be, of course, that the second agent will not talk to the first agent, but there is no evidence of that.
- [20]Leaving aside the question of jurisdiction, it seems to me that these other matters raise concerns about the appropriateness of making an order in the terms sought. However, I do not propose at this stage to dismiss the application; rather, I will adjourn it to a date to be fixed, and invite the applicant to consider placing further submissions before me, and perhaps further material, before a final decision on the application is made. At this stage therefore I will simply adjourn the application to a date to be fixed, and provide these reasons to this applicant.
Footnotes
[1] The affidavit of the applicant’s solicitor uses the expression “sought to introduce that purchaser to” the respondent. He was not clear whether there was a physical meeting between the prospective purchaser and the respondent, or indeed whether the respondent was told of the prospective purchaser’s identity at this time, but I assume that at least the latter occurred.
[2] For example, the second agent may have been instrumental in arranging finance which enabled the contract of purchase to go ahead: Moran v Hull [1967] 1 NSWR 723.
[3] In the first case it is not entirely clear that there was correspondence specifically relating to the proposed interrogatories; the respondent’s willingness to communicate with the applicant may have ceased before the point arose. Nevertheless, it appears that there had been attempts to obtain information from him voluntarily, which he rebuffed.