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Walpole v J1-Plan Pty Ltd[2021] QDC 34

Walpole v J1-Plan Pty Ltd[2021] QDC 34

DISTRICT COURT OF QUEENSLAND

CITATION:

Walpole & Anor v J1-Plan Pty Ltd [2021] QDC 34

PARTIES:

GARY WALPOLE AND CHRISTINE WALPOLE
(Plaintiffs)

v

J1-PLAN PTY LTD (FORMERLY FINANCIAL TECHNOLOGY SECURITIES PTY LTD) (ACN 060 655 978)
(Defendant)

FILE NO/S:

3811 of 2018

DIVISION:

Civil

PROCEEDING:

Application

ORIGINATING COURT:

District Court, Brisbane

DELIVERED ON:

16 February 2021 (ex tempore)

DELIVERED AT:

Brisbane

HEARING DATE:

16 February 2021

JUDGE:

Kefford DCJ

ORDER:

I order that the Application be dismissed.

CATCHWORDS:

APPLICATION IN PENDING PROCEEDING – where the plaintiff’s statement of claim was filed on 24 October 2018 – where the defendant asserts that the loss was ascertainable on 20 September 2012 – where the plaintiff’s case is not limited to loss sustained as a consequence of following advice to take out a loan – whether there is an insurmountable limitation of actions defence – whether the plaintiff has no real prospect of succeeding on all or a part of the claim – whether it would be appropriate to exercise discretion to give summary judgment for the defendant

APPLICATION IN PENDING PROCEEDING – where the defendant sought alternative relief that the plaintiff’s amended statement of claim be struck out – where the application did not disclose the basis of the alternative relief – whether the application for alternative relief should be entertained

LEGISLATION:

Uniform Civil Procedure Rules 1999 (Qld), r 293

CASES:

Bankier v HAP2 Pty Ltd [2019] QSC 101

Deputy Commissioner of Taxation v Salcedo [2005] QCA 227; [2005] 2 Qd R 232

Wardley Australia Limited and Anor v Western Australia (1992) 172 CLR 514

COUNSEL:

A C Stumer for the applicant

J P Morris for the respondent

SOLICITORS:

Barry Nilsson for the applicant

Maurice Blackburn for the respondent

  1. [1]
    By its application filed on 18 December 2020, the defendant seeks summary judgment in respect of the whole of the claims against the defendant.  The basis for summary judgment is that there is an insurmountable limitation of actions defence to the causes of action in the statement of claim. 
  2. [2]
    The test for an application of this type is set out in rule 293 of the Uniform Civil Procedure Rules 1999.  It states:

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

  1. (2)
    If the court is satisfied-
  1. (a)
    the plaintiff has no real prospect on succeeding on all or a part of the plaintiff’s claim; and
  1. (b)
    there is no need for a trial of the claim or the part of the claim;

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

  1. [3]
    In Deputy Commissioner of Taxation v Salcedo [2005] QCA 227; [2005] 2 Qd R 232, Williams JA observed at 236 [17]:

“… 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 applicant has established some real prospect of succeeding at a trial;  if that is established then the matter must go to trial. …”

  1. [4]
    A real prospect of success should be contrasted with the prospect that is fanciful.  In Deputy Commissioner of Taxation v Salcedo [2005] QCA 227; [2005] 2 Qd R 232, McMurdo P observed at 233 [3]:

“Nothing in the UCPR, however, detracts from the well-established general principle that issues raised in proceedings will be determined summarily if only in the clearest of cases.  Gaudron, McHugh, Gummow and Hayne JJ said in Agar v Hyde recently cited with approval by Gleeson CJ, McHugh and Gummow JJ in Rich v CGU Insurance Limited:

“… Ordinarily, a party is not to be denied the opportunity to place his or her case before the court in the ordinary way, and after taking advantage of the usual interlocutory processes.  The test to be applied has been expressed in various ways, but all of the verbal formulae which have been used are intended to describe a high degree of certainty about the ultimate outcome of the proceeding if it were allowed to go to trial in the ordinary way.”

(footnotes omitted)

  1. [5]
    In Wardley Australia Limited and Anor v Western Australia (1992) 172 CLR 514, Mason CJ and Dawson, Gaudron and McHugh JJ observed at 533:

“We should, however, state in the plainest of terms that we regard it as undesirable that limitation questions of the kind under consideration should be decided in interlocutory proceedings in advance of the hearing of the action, except in the clearest of cases.  Generally speaking, in such proceedings, insufficient is known of the damage sustained by the plaintiff and of the circumstances in which it was sustained to justify a confident answer to the question.”

  1. [6]
    The onus is on the applicant defendant to satisfy the court that there is no prospect of success or no need for a trial.  The defendant’s case for summary judgment hinges on its characterisation of the pleadings.  It asserts that the loss was ascertainable on 20 September 2012 when the plaintiff received a statement of advice recommending that investments be sold because the value of the investments was $240,237 less than money owed under loan facilities.  The defendant says it is at that point on 20 September 2012 that the loss was ascertained or ascertainable.  On that basis, it says the plaintiff’s statement of claim filed on the 24 October 2018 is out of time.  The defendant says it was filed more than six years after the date on which the causes of action accrued.
  2. [7]
    The defendant acknowledges that for the purpose of its summary judgment application, the critical question is the date on which each cause of action accrued.  Causes of action in negligence and for statutory misleading or deceptive conduct accrue at the time that loss is suffered, provided the damage is more than negligible and the loss measurable. 
  3. [8]
    The defendant accepts that in cases involving losses suffered due to deficient financial advice there can often be difficult factual questions about the point of time when the investment strategy adopted has resulted in actual as opposed to prospective loss.  It submits that the present case is not such a case. 
  4. [9]
    The defendant points to the plaintiff’s allegations that their net debt after sale of investments constituted a loss.  It submits that it was clear from no later than 20 September 2012 that the amount of the plaintiff’s debt incurred for investment purposes substantially exceeded the value of investments.  The defendant submits that from no later than that time, the plaintiff’s loss was ascertained or ascertainable and the cause of action had accrued.
  5. [10]
    The defendant’s submissions ignore that the plaintiff’s case is not one limited to loss sustained as a consequence of following advice to take out a loan.  The plaintiff’s case is much more nuanced.  It takes issue with the advice to take out a loan, but also takes issue with the nature of the investments that it was advised to pursue.  The plaintiff’s case includes an allegation that the initial advice was defective.  It was said to be defective for numerous reasons, not limited to the exposure of the plaintiff to significant and increasing financial liabilities
  6. [11]
    The bases upon which the initial advice was said to be defective include that the defendant’s advice recommended an investment strategy that:
    1. (a)
      involved investment entirely in the Australian equity market;
    2. (b)
      exposed the plaintiffs to significant risk and exposure in the event of a depressed market;
    3. (c)
      recommended investments that were significantly in excess of the plaintiff’s savings and disposable annual income;
    4. (d)
      failed to provide any or any adequate risk management strategy to protect the plaintiffs in a depressed market;
    5. (e)
      required the commitment of almost all of the plaintiff’s disposable annual income to future investment without any or adequate risk management provisions;
    6. (f)
      was high risk considered suitable to investors seeking high returns, growth and income and willing to risk capital investment to achieve the same.
  7. [12]
    The plaintiff’s case is also one that it was not suitable for balanced investors.  The amended statement of claim includes allegations about what the plaintiff says a reasonably competent provider of financial advice in the position of the defendant would have advised.  However, the plaintiff’s case is not limited to an allegation of loss that is contingent upon the court accepting its alternative initial advice allegations.  This is apparent from paragraph 50 of the amended statement of claim. 
  8. [13]
    Mr Stumer, Counsel for the defendant, accepted that, were the matter to proceed to trial, the trial judge would not be obliged to accept all of the plaintiff’s case.  He acknowledged that it is possible that a court might accept part only of the allegations made by the plaintiff and that, in doing so, conclude that loss has been suffered at a different time than that alleged by the defendant.
  9. [14]
    Given that, the question of when the loss was ascertained or ascertainable is a complex question.  This is not a case that could be described as a clear case about the operation of limitation periods.  In Bankier v HAP2 Pty Ltd [2019] QSC 101, at paragraphs 197 to 199 Martin J warned about the complexity of this nature of matter. 
  10. [15]
    In the circumstances, I am not persuaded that this is an appropriate case to exercise my discretion to give summary judgement for the defendant against the plaintiff.  The application filed by the defendant on the 18th of December 2020 sought alternative relief, namely:

“Alternatively to order 1, the plaintiff’s amended statement of claim filed on 12 March 2020 be struck out pursuant to Rule 171 of the Uniform Civil Procedure Rules.”

  1. [16]
    The application did not disclose the basis of the alternative relief.  It only indicated that at the hearing of the application, the applicant intended to rely on an affidavit of Jordan Farr, which was yet to be sworn.  Counsel for the defendant acknowledged that the affidavit was provided late.  The plaintiff submits that the application for alternative relief should not be entertained today.  They submit that the application was deficient in failing to disclose the basis for the strikeout application, given the affidavit was not provided as required under the rules.  I accept that the defendant’s application for alternative relief should be dismissed on that basis.
  2. [17]
    The application is dismissed.
Close

Editorial Notes

  • Published Case Name:

    Walpole & Anor v J1-Plan Pty Ltd

  • Shortened Case Name:

    Walpole v J1-Plan Pty Ltd

  • MNC:

    [2021] QDC 34

  • Court:

    QDC

  • Judge(s):

    Kefford DCJ

  • Date:

    16 Feb 2021

Appeal Status

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