WILLIAMS v WILLIAMS SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL MEAGHER, SAMUELS and PRIESTLEY JJA 15 March 1989, 15 March 1989 [1989] NSWCA 236 Contract — sale of shares — shares held by third party — whether alleged contract supported by consideration. ORDERS 1. Appeal dismissed with costs. Meagher JA In this matter the plaintiff is the father of the defendant and hassought in his statement of claim to seek certain relief based on the sale of a share in a company. The share was not registered in the name of the son, the defendant in the case, but was in the name of a third party. That claim as originally framed asked for declarations that the share in question was held on trust for the plaintiff father. Evidence was given at the trial which indicated that in fact the share had been settled, (if it matters, by the plaintiff himself) on a trust for certain infants, who were not parties to the litigation. This morning Mr Palmer, for the appellant plaintiff, very properly agreed that the sort of relief sought in the statement of claim could not proceed in the absence of the trustee and of the beneficiaries under that trust. However, he has suggested that an agreement of a kind rather different from that alleged in the statement of claim should be found by this Court. After some discussions, he again very properly withdrew that submission and urged the Court to deal with the matter solely on the basis on which it is pleaded in paragraph 3 of the statement of claim. Paragraph 3 of the statement of claim alleged that in or about March 1979 there was an agreement between the plaintiff, the father, and the defendant, the son, that the plaintiff would purchase the share in question, which was then standing in the name of two other persons, and that the plaintiff father would pay to those persons sufficient monies to repay the amount standing to their credit in a loan account. That was the submission which this Court said it would hear. There is certainly evidence, which Mr Palmer refers to, which justifies the claim set out in paragraph 3 of the statement of claim. The facts disclosed that the defendant son was initially contemplating purchasing the share in question, but that the son said to his father, "I can't buy him out. Will you buy him out?" Then in the same or slightly later conversation, it was agreed, according to the plaintiff, that "I would go ahead and provide the money and he would set up the arrangement in Morton and Harris office with Mr Elvy. The loan account I knew to be $71,499.00". The plaintiff in evidence later summarised the contemplated transaction in these terms, that he was to give Mr Svenson his money for his share. That evidence, as I say, amply demonstrates that there was, as his Honour found, an agreement between both parties that one of them would purchase the share from a third person. His Honour, not surprisingly in the light of that evidence, in effect found that the facts alleged by the plaintiff were made out; but not surprisingly, in view of the way the matter was pleaded, his Honour was compelled to find that the agreement relied on in paragraph 3 of the statement of claim was a non binding agreement. There was, as his Honour pointed out, no consideration flowing to or from the defendant; 2 UNREPORTED JUDGMENTS there was a mere acknowledgement by the defendant that the plaintiff would negotiate and enter into a contract for sale with a third party. If one asks what promise the defendant was alleged to have made, there simply does not seem to have been any. It is beside the point that there would be considerable satisfaction to the defendant if the plaintiff did what he promised to do, namely, enter into a contract with a third party; but there can, in those circumstances, be no valid reply to the fact that neither on the pleadings nor on the evidence, nor on the findings of his Honour, was there any consideration for the agreement alleged. In my view, therefore, the appeal should be dismissed with costs. The order of the Court is, the appeal is dismissed with costs. Counsel for the Appellant: Mr GA Palmer QC and GC Lindsay Solicitors for the Appellant: Lakos Buntman Counsel for the Respondent: JS Van Aalst Solicitors for the Respondent: Cutler, Hughes and Harris