BABETS LTD (in liq) v VENN [1997] NSWCA 36

BABETS LTD (in liq) v VENN

SUPREME COURT OF NEW SOUTH WALES — COURT OF APPEAL — COMMERCIAL DIVISION

POWELL, COLE and STEIN JJA 16, 24 September 1997 [1997] NSWCA 36

SALE AND VALUATION OF BUSINESS — calculation of contractual purchase — PRICE — damages sought for breach of warranty — calculation of amount payable on claim and cross-claim-set-off.

Cole JA. Ex tempore

Babets Ltd (in liq), and Mr Silva as its liquidator, sued John Frederick Venn, Caroline Gaye Orriss, Lesley Robyn Walters and Wenn Holdings Pty Ltd arising out of the sale of an insurance broking business. The writ claimed monies due pursuant to the agreement for sale, and a claim based on unjust enrichment. The statement of claim prompted a defence and cross-claim which denied that any monies were due pursuant to the contract. It was claimed that the contract should be set aside as being voidable, and pursuant to the provisions of the Trade Practices Act. Damages were sought for breaches of warranty if a contract was held established, and pursuant to the Trade Practices Act. In a judgment delivered 20 April 1995 Hunter J entered judgment for the defendants on the summons. His Honour declared that the three personal defendants were not parties to the agreement for sale which he found established between Babets Ltd and Wenn Holdings and entered judgment for the latter company on the cross-claim in the sum of $5,000. The plaintiffs were ordered to pay the costs of all proceedings. Babets Ltd (in liq) and Mr Silva have appealed.

The issues on appeal were in short compass. They are best understood by consideration of the figures in the table below.

CLAIM 1. Adjusted purchase price $282,990.00 2. Equipment 8,000.00 290,990.00 3. Less: instalment paid 162,565.00 Balance due to appellants 128,425.00 DAMAGES 4. Reduced value of business purchased Price 282,990.00 Less value at 1.1.91 216,754.00 66,236.00 5. Debts not paid by appellants 24,000.00 6. Relocation expenses 15,000.00