Harmosse Pty Ltd v Mobil Oil Australia Ltd [2000] FCA 349

FEDERAL COURT OF AUSTRALIA

Haramosse Pty Ltd v Mobil Oil Australia Ltd [2000] FCA 349

HARAMOSSE PTY LTD & ANOR v MOBIL OIL AUSTRALIA LIMITED NO. T31 OF 1999 HEEREY J 21 MARCH 2000 HOBART

IN THE FEDERAL COURT OF AUSTRALIA

TASMANIA DISTRICT REGISTRY T31 OF 1999

BETWEEN: HARAMOSSE PTY LTD (ACN 009 536 074)

First Applicant

MARTIN ARTHUR ARNOLD

Second Applicant

AND: MOBIL OIL AUSTRALIA LIMITED (ACN 004 052 984)

Respondent

JUDGE: HEEREY J

DATE OF ORDER: 21 MARCH 2000

WHERE MADE: HOBART

THE COURT ORDERS THAT: 1. The application is dismissed. 2. The applicants pay the respondent's costs of the motion dated 17 March 2000 and the costs of the proceeding including reserved costs, such costs to be taxed in default of agreement. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

TASMANIA DISTRICT REGISTRY T31 OF 1999

BETWEEN: HARAMOSSE PTY LTD (ACN 009 536 074)

First Applicant

MARTIN ARTHUR ARNOLD

Second Applicant

AND: MOBIL OIL AUSTRALIA LIMITED (ACN 004 052 984)

Respondent

JUDGE: HEEREY J

DATE: 21 MARCH 2000

PLACE: HOBART

EX TEMPORE REASONS FOR JUDGMENT 1 The respondent by a notice of motion dated 17 March 2000 seeks orders (1) that paragraphs 4 to 18 of the applicants' statement of claim be struck out pursuant to O 11, r 16(b); (2) further or alternatively that the applicants' statement of claim be struck out pursuant to O 11, r 16(a); (3) further or alternatively that the applicants' application be dismissed on the ground that (a) no reasonable cause of action is disclose; (b) the proceeding is frivolous or vexatious. 2 On 18 January 2000 I dismissed the applicants' application for an interlocutory injunction. The reasons I gave on that occasion are to be treated as incorporated in these present reasons and I shall not repeat them. The applicants say that they have accepted the repudiation of the agreement to grant a retail area franchise and their claim is now confined to damages for breach of that agreement. I note however that the present statement of claim which was filed on 1 February 2000 on its face does not allege that the repudiation was accepted. 3 Even though this is the third statement of claim, were it a matter of defective pleading the Court would ordinarily give the applicants leave to state their case properly in a further pleading. However, the present motion by the respondent attacks not merely the form of the statement of claim as a matter of adequate pleading but the substantive merits of the claim. It is said that no reasonable cause of action is disclosed and that the Court should exercise its power to grant summary judgment. It is accepted by the respondent of course that summary judgment is reserved for cases which are hopeless and have no prospect of success and that this is a high standard. 4 The applicants' case necessarily depends on establishing that there was a binding contract for the grant of a retail franchise agreement. In my reasons for the refusal of an interlocutory injunction I have pointed out the major problems involved in the applicants' case. In particular, there was the letter of 22 September 1997 which in its terms was expressed to be conditional on negotiation and execution of a final agreements but in any event specified payment of an up-front franchise fee of $200,000 within 60 days. The evidence was undisputed that that money was not paid. 5 Counsel for the applicants was unable to put forward any argument which might have led to a conclusion different from that expressed in my reasons of 18 January. Counsel said that it was still the applicants' contention that there has been an agreement and that evidence could be given to support that contention; but the nature of that evidence was not disclosed and on the face of the material to which I have already referred it seems inherently unlikely that such evidence would be available. 6 In fairness to counsel for the applicants it is to be noted that his instructions may not always have been as full as they should have been. In particular, it was not until the hearing of the interlocutory injunction application that counsel became aware that the applicants had subsequently entered into a commission agency agreement. 7 For the reasons I have mentioned I am satisfied that no good purpose would be served in continuance of this proceeding and that the applicants have no prospects of success. It would be doing them no favour to allow the matter to proceed and it would be a cause of unnecessary and unwarranted expense for the respondent. So I will order that the application be dismissed. 8 I will order the applicants pay the respondent's costs of the motion dated 17 March 2000 and the costs of the proceeding to be taxed including reserve costs.