Orix Australia Corporation Ltd v Moody Kiddell & Partners P/L & 7 Ors [2005] NSWSC 1209

New South Wales Supreme Court

CITATION : Orix Australia Corporation Ltd v Moody Kiddell & Partners P/L & 7 Ors [2005] NSWSC 1209

HEARING DATE(S) : 2-6/05/05, 22/09/05, 17-20/10/05

JUDGMENT DATE : 30 November 2005

JURISDICTION : Equity Division

JUDGMENT OF : White J

DECISION : See para 177 of judgment.

CATCHWORDS : TRADE PRACTICES – Misleading or deceptive conduct – Fraudulent scheme raising finance through a purported hire purchase of non-existent cranes – Where finance was arranged through defendant finance broker – Where application for finance prepared by broker – Application forms represented that the funds were to be used to buy cranes – Plaintiff did not rely on broker to verify information - Claim by plaintiff finance company that defendant finance broker knew or had reason to suspect that the information supplied by applicant was false – Whether conduct by defendant amounted to endorsing the false information provided by the applicant or otherwise warranting its correctness – Held that although broker did more than merely pass on the information, it did not endorse or adopt it - broker had reasonable grounds for making the representations and did not engage in misleading or deceptive conduct - TRUSTS – Claim that director of company which supplied invoices for the fictitious cranes knowingly assisted in the company's breach of trust – Where director knew that company did not have and would not acquire title to the cranes prior to invoicing the finance company – Held that money received by the company from the plaintiff was held on trust – Company paid money into its bank account which was in credit and later paid moneys to applicant for finance – Held that director liable to pay equitable compensation for knowingly or dishonestly assisting company's breach of trust - RESTITUTION – Claim that brokerage was paid under a mistake of fact because the cranes did not exist – Alternative claim that there had been a total failure of consideration on the part of the broker – Brokerage contract construed – Held that introducing business which resulted in finance contracts being entered into was consideration – Judgment in favour of broker.