Brown v Cornwell [2002] NSWSC 302

New South Wales Supreme Court

CITATION : Brown v Cornwell [2002] NSWSC 302 CURRENT JURISDICTION: Common Law FILE NUMBER(S) : SC 13900/01 HEARING DATE(S) : Monday 18 March 2002 JUDGMENT DATE : 18 March 2002

PARTIES : Allan John Brown v Brian Ernest Cornwell (in practice as Cornwell Solicitors & Advocates) JUDGMENT OF : Michael Grove J at 1

LOWER COURT Local Court JURISDICTION : LOWER COURT 879/2000 FILE NUMBER(S) : LOWER COURT C.A. Elliott, LCM JUDICIAL OFFICER :

COUNSEL : G. Carolan (Plaintiff) S.A. Kerr with M. Sneddon (Defendant) SOLICITORS : Turnbull Hill (Plaintiff) Colin Biggers & Paisley (Defendant) CATCHWORDS : LOCAL COURT - CIVIL CLAIM - COMMON MONEY COUNT - FACTUAL FINDINGS BY MAGISTRATE - NO ERROR IN RESULT DECISION : Summons dismissed with costs

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

MICHAEL GROVE J

Monday 18 March 2002

13900/01 - ALLAN JOHN BROWN v BRIAN ERNEST CORNWELL (in practice as CORNWELL SOLICITORS & ADVOCATES)

JUDGMENT

1 HIS HONOUR: This is a summons seeking relief in connection with the decision of the Magistrate presiding at the Local Court in Toronto on 29 November 2001. 2 There was before that Court a claim by the plaintiff expressed as a common money count seeking payment of the sum of $37,000 for money had and received. 3 By way of background, it can be mentioned that the plaintiff was a builder and became involved in arrangements with a company called Natcat Pty Ltd and a man called Humphries who was connected with that corporation. 4 The defendant in the proceedings is a solicitor who was retained not by the plaintiff but by the latter. I mention in passing that the defendant had established a family trust in connection with the proposed development of land owned by Natcat Pty Ltd upon which it was proposed, apparently, to construct some six home units. It is not necessary for present purposes to distinguish between Mr Humphries, his company and his family trust. 5 The negotiations between the plaintiff and the person and entities that I have mentioned led to the drafting of a joint venture agreement. This was, in due course, executed by the plaintiff but a counterpart was apparently not executed by Mr Humphries or the trust or the corporation. 6 The money was paid into the defendant's trust account in two parcels: the first of $20,000 and the second of $17,000. How those particular amounts came to be paid is fairly plain from the terms of the proposed joint venture agreement. I say "proposed" because it is the contention of the plaintiff that such agreement was never concluded. 7 The error contended to have been made by the Magistrate was in his adverting to provisions of the agreement and using that as a basis for his finding that there should be judgment for the defendant. The particular provisions in the document set out that the plaintiff agreed to pay a deposit of $20,000 which would be immediately released, in effect, to the Humphries' interests and a further provision that another $17,000 be contributed towards development costs. The project eventually failed. 8 By consent I have had placed before me statements which were used as evidence in the Local Court and also a transcript of some oral evidence there given. It is plain that the defendant in due course, has disbursed the sum of $37,000 in accordance with the instructions of Natcat Pty Ltd. That he did so is hardly surprising, having regard to the terms of the respective receipts, both of which reveal that the money was received on the account of Natcat Pty Ltd described in the first receipt as "deposit" and the second as "settlement moneys". 9 The argument on behalf of the plaintiff was formulated along the lines of asserting that as there was no evidence of a concluded joint venture agreement, then it was erroneous for the Magistrate to determine the case on the basis of its provisions and, further, that in the absence of such agreement the defendant must have been held to have been holding the money on behalf of the plaintiff. 10 My jurisdiction is limited to intervention in relation to legal error. There was a finding by the Magistrate that there was no exchange of the joint venture agreement nor, indeed, in its terms was there any requirement for such. 11 I recognise that the reference may be regarded as putting the cart before the horse but it suffices, in my view, to observe that an agreement of the nature of that proposed does not oblige reduction to writing and there was powerful evidence that the plaintiff regarded the agreement as evidencing the arrangements between himself and Natcat Pty Ltd and Mr Humphries in that his own solicitor dispatched the executed copy, together with one of the cheques for the amounts that I have mentioned. But, even if there were any doubt about that, the plaintiff's own evidence is confirmatory of the circumstance that the defendant was not holding the money on behalf of the plaintiff. 12 In quite candid testimony he testified before the Magistrate that the money was in accordance with the agreement to go to Natcat Pty Ltd. He recognised that his negotiations were with Mr Humphries and finally he gave this evidence: "Q. You knew that you were never giving the money to Mr Cornwell, correct? That's correct, I gave it to Natcat."