Daily Banking: Thursday, 14 May 2015 View in browser

A daily Bulletin listing our choice of Decisions of Superior Courts of Australia.

Daily Banking

Executive Summary (One Minute Read)
Selig v Wealthsure Pty Ltd (HCA) - corporations - proportionate liability regime in Div 2A Corporations Act 2001 (Cth) limited to claims of misleading or deceptive conduct based on contravention of s1041H - appeal allowed - costs ordered against non-party professional indemnity insurer
Delaney v Winn (NSWCA) - negligence - no breach of duty of care or negligence by building inspector - appeal dismissed
Yarraford Pastoral Co Pty Ltd v Lewington (NSWSC) - Local Court appeal against refusal to award damages for use or possession of excavator - appeal dismissed
Sugar Australia Pty Ltd v Lend Lease Services Pty Ltd (VSCA) - building contract - balance of convenience did not support injunction restraining resource to bank guarantees - appeal allowed
Central Cleaning Supplies (Aust) Pty Ltd v Elkerton (VSCA) - contract - securities - supplier of cleaning equipment entitled to enforce retention of title clause - appeal allowed
Brisbane City Council v Newton (QCA) - security for costs - application for leave to appeal from termination of residential tenancy agreement and issue of warrant of possession - security for costs granted
Johnson v Hallam (WASC) - contract - no concluded agreement for purchase of property by tenant from owner - summary judgment for owner
Summaries With Link (Five Minute Read)
Selig v Wealthsure Pty Ltd [2015] HCA 18
High Court of Australia
French CJ; Kiefel, Bell, Gageler & Keane JJ
Corporations - appellants invested in “Ponzi scheme” on second respondent’s advice - second respondent was  representative of first respondent - appellants lost initial investment and suffered loss -  appellants claimed first and second respondents contravened various provisions of Corporations Act 2001 and Australian Securities and Investments Commission Act 2001 - first and second respondents submitted that Div 2 Corporations Act and corresponding provisions of ASIC Act limited their liability to proportion of appellants’ loss and damage - whether Div 2A limited in its application to claims based on contraventions of s 1041H - held: ‘apportionable claim’ for purposes of Div 2A was a claim based on contravention of s1041H Corporations Act - proportionate liability regime did not apply to other statutory or common law causes of action - reasoning applied equally to analogue provisions of ASIC Act - costs awarded against first respondent’s professional indemnity insurer - insurer had conduct of defence at trial and decided to appeal to Court below -  decision to appeal meant money which it would have been obliged to pay appellants was diverted to meet insurer’s legal costs - insurer had acted for itself in seeking to better position by bringing appeal - no reason it should be regarded as immune from costs order - appeal allowed.
Delaney v Winn [2015] NSWCA 124
Court of Appeal of New South Wales
Ward, Emmett & Gleeson JJA
Negligence - prior to purchase of home appellants obtained property inspection report including report on property’s condition based on visual inspection carried out by respondent building consultant - respondent attended site meeting with first appellant and father at which respondent advised on engagement of structural engineer concerning retaining wall showing evidence of movement - after rain first appellant found “new looking” cracking - another building inspector and engineer assessed condition of dwelling as below average - property sold for amount less than what appellants paid - appellants sued respondent seeking damages and equitable compensation - primary judge found building consultant had not breached duty of care to carry out pre-purchase property inspection in compliance with Australian Standard and had not provided negligent advice - ss5D & 16 Civil Liability Act 2002 - held: primary judge did not err in not articulating or finding duty of care for which appellants had not contended in pleadings or otherwise - primary judge did not err in conclusions on expert evidence or credit findings - no error in conclusion respondent’s inspection and advice did not fall below standard expected of reasonably competent building inspector - appeal dismissed.
Yarraford Pastoral Co Pty Ltd v Lewington [2015] NSWSC 522
Supreme Court of New South Wales
Beech-Jones J
Damages - use or possession of excavator - Local Court upheld part of claim by plaintiff against defendant for damages for use or possession of its “Bobcat” - appeal concerned rejection of claim for damages for use or possession of its excavator - plaintiff contended presiding magistrate’s reasons rejecting claim were so inadequate as to amount to an error of law - s42 Fair Trading Act 1987 - ss39 to 41 Local Court Act 2007 - held: Magistrate discharged obligation to give reasons for primary findings of fact - appeal dismissed.
Sugar Australia Pty Ltd v Lend Lease Services Pty Ltd [2015] VSCA 98
Court of Appeal of Victoria
Osborn, Ferguson & Kaye JJ
Building contracts - dispute concerning performance of contract works - appeal against decision granting interlocutory injunction restraining recourse to two bank guarantees which builder had provided to an owner under building contract - whether proprietor acting reasonably in seeking recourse to security - held: primary judge erred in failing to reach concluded view as to correct construction of clause governing availability of recourse to security - balance of convenience did not support grant of injunction - appeal allowed.
Central Cleaning Supplies (Aust) Pty Ltd v Elkerton [2015] VSCA 92
Court of Appeal of Victoria
Maxwell P, Tate & Beach JJA
Contract - securities - appellant supplied cleaning equipment - company (Swan) was customer - appellant supplied cleaning equipment to Swan - appellant invoiced Swan for each supply of equipment - invoice contained retention of title (ROT) clause - Swan went into liquidation - respondent was liquidator - there were unpaid invoices for equipment supplied - appellant sought to enforce  ROT clause - liquidator resisted claim - appellant did not register security interest in respect of any of the equipment supplied - claim to recover equipment could only succeed if its interest was covered by transitional provisions of  Personal Property Securities Act 2009 - whether appellant’s security interest in equipment supplied after 30 January 2012 was ‘provided for’ by arrangement entered into between appellant and Swan in September 2009 for  supply of equipment 30 day credit - held: primary judge erred in holding credit arrangement did not ‘provide for’ granting of the security interests in the future - terms on which appellant agreed  to provide credit to Swan included provision for ROT clause as standard term of each future supply of equipment - appeal allowed.
Brisbane City Council v Newton [2015] QCA 069
Court of Appeal of Queensland
Holmes JA
Security for costs - Council sought security for costs of  application for leave to appeal against decision of Appeal Division of Queensland Civil and Administrative Tribunal to confirm QCAT’s decision to terminate residential tenancy agreement between parties and issue warrant of possession - held: applicant impecunious - order for security would have stifling effect on litigation - no prejudice in delay - applicant had lost case at two levels of Tribunal - prospects of showing substantial injustice or any important question of law were slight - no prospect of Council recovering costs should applicant fail - justice of case required order for security for costs.
Johnson v Hallam [2015] WASC 149
Supreme Court of Western Australia
Master Gething
Summary judgment - contract - owners of property leased property  to tenants - tenants in default of lease - tenant claimed he and owner agreed to forgive tenants’  obligations to pay arrears of rent provided tenant submitted to owner an offer in writing to purchase property - tenant claimed he submitted offer but owner refused to complete transaction in breach of agreement - tenant claimed damages for loss of opportunity to exploit intellectual property rights - owner claimed there was no agreement, and counterclaimed for arrears and possession - owner sought summary judgment - held: parties did not enter concluded agreement for sale of property - summary judgment ordered in favour of owner against tenant’s claim