ROY v MADDOCKS and ANOR [1998] NSWCA 198

ROY v MADDOCKS SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

MASON P, PRIESTLEY and SHELLER JJA 23 March 1998

[1998] NSWCA 198

Mason P Mr John Roy and his late brother, Leslie, were equal partners in a business from 1926 to 1992. The business began to be scaled down after 1971.

Proceedings were brought by John against Leslie's estate, Leslie having died in late 1992, for various orders including an order claiming an interest in a property at Canyon Lea and orders relating to the dissolution of the partnership between the two brothers.

Those proceedings were heard in the Equity Division, ultimately by Hulme J. Hulme J dismissed John Roy's claim to an interest in the Canyon Lea property. He made a declaration that the partnership between the brothers was dissolved on 10 July 1992. He left open the prospect of ordering accounts and the matter was stood over on a number of occasions. John was ordered to file affidavits, which he did, which were considered by the Judge. Ultimately, however, on 22 September 1995 his Honour held that it would be impossible to determine the respective interests of the partners in the remaining assets and liabilities of the partnership. Accordingly, he held that no order for the taking of the partnership accounts should be made.

Mr Roy appealed and the appeal was heard by the Court of Appeal comprising Handley JA, Powell JA and Cole JA. In a reserved judgment given by Handley JA, with the concurrence of the other two judges, the appeal was dismissed.

Handley JA noted the submission by John Roy that the result of the earlier orders in the Court meant that Leslie Roy finished up with more than his equal share of the partnership assets. However, his Honour held that the Court cannot know what the true position is between the two brothers without the taking of the accounts of the partnership; this was an application of well-established principles of partnership law. His Honour, noting that it had become impossible for those partnership accounts to be taken and that this had been acknowledged, reluctantly dismissed the appeal.