Connections Total Fitness for the Family Pty Limited v Selkirk Pastoral Co Pty Limited [2014] NSWSC 184

Supreme Court New South Wales

Medium Neutral Citation: Connections Total Fitness for the Family Pty Limited v Selkirk Pastoral Co Pty Limited [2014] NSWSC 184 Hearing dates: 3, 4 & 5 March 2014 Decision date: 14 March 2014 Jurisdiction: Equity Division Before: Slattery J Decision: Declaration made that the defendant purchased the first plaintiff's business in May 2013. Declaration that the defendant is liable to indemnify the plaintiffs in respect of the debt obligations of the first plaintiff excluding related-party obligations. Order for an enquiry as to the non related-party debt obligations of the first plaintiff. Catchwords: CONTRACT - general principles - lessor (the defendant) takes over the leased premises from a tenant (the first plaintiff) - whether as the price of acquiring the business the landlord has agreed to acquire the tenant's business conducted on the leased premises - whether the landlord has agreed to indemnify the directors of the tenant company (the second and third plaintiffs) in respect of the whole of the debt obligations of the tenant, or merely in respect of the external (non related-party) debt obligations of the tenant - whether declaratory relief appropriate - inquiry as to the extent of the debt obligations of the first plaintiff. Cases Cited: Air Great Lakes Pty Ltd v KS Easter (Holdings) Pty Ltd (1985) 2 NSWLR 309 Andara Transport Pty Ltd v Brambles (2004) 217 CLR 424 Associated Newspapers Ltd v Bancks (1951) 83 CLR 322 Bank of Australasia v Palmer [1897] AC 540 BHP Refinery (Westernport) Pty Ltd v Hastings Shire Council (1977) 180 CLR 266 Brambles Holdings Limited v Bathurst City Council (2001) 53 NSWLR 153 Hewitt v Debus (2004) 54 NSWLR 617 Heyman v Darwins Ltd [1942] AC 356 Hillas & Co Ltd v Archos Ltd (1932) 147 Lt 503 Hoyt's Pty Ltd v Spencer (1919) 27 CLR 133 James Miller & Partners Ltd v Witworth Street Estates (Manchester) Ltd [1970] AC 583 Port Sudan Cotton Co v Govindaswany Chettian & Sons (1977) 2 Lloyd's Rep. 5 Prints for Pleasure Ltd v Oswald-Sealy (Overseas) Ltd [1968] 3 NSWR 761 Sargent v ASL Developments Ltd (1974) 131 CLR 634 Subdivisions Limited v Payne [1934] SASR 214 Tramways Advertising Pty Ltd v Luna Park (NSW) Ltd (1938) 38 SR (NSW) 632 Texts Cited: Contract Law in Australia, 5th edition, Carter, Peden and Tolhurst, (2012) at [12-08] Category: Principal judgment Parties: First Plaintiff: Connections Total Fitness for the Family Pty Limited (ACN 134 011 091) Second Plaintiff: Connections Health Clubs of Australia Pty Limited (ACN 134 010 656) Third Plaintiff: Peter Sheehy Fourth Plaintiff: David Wright Defendant/Cross-Claimant: Selkirk Pastoral Co Pty Limited (ACN 085 917 059) Representation: Counsel: Plaintiffs: A. Braham SC; A.D. Crossland Defendant: A.G. Martin Solicitors: Plaintiffs: Karen Watson, Meehans Solicitors Defendant: Geoff Lloyd, Caldwell, Martin, Cox Solicitors File Number(s): 2013/169953 Publication restriction: No