Abignano Nominees Pty Ltd v Sheripeter Pty Ltd [2016] NSWSC 1378

Supreme Court New South Wales

Medium Neutral Citation: Abignano Nominees Pty Ltd v Sheripeter Pty Ltd [2016] NSWSC 1378 Hearing dates: 5-7 September 2016 Decision date: 30 September 2016 Jurisdiction: Equity Before: White J Decision: Plaintiff to bring in short minutes of order in accordance with reasons. Catchwords: PARTNERSHIP — Taking of account — Plaintiff and defendant entered into an oral partnership agreement for the acquisition and development of a property — Partners agreed to contribute equally to the costs of the purchase and development of the property — Partners agreed that they would be entitled to share in the profits equally — Partners entered into a partition agreement — Partners dispute how the costs, expenses and profits of the partnership should be accounted for and divided between the parties on the final accounting — Whether payments made during the course of the partnership constituted advances or contributions of capital — Payments better characterised as advances not contributions to capital — Whether the values of distributed units should be determined according to their true market value or the values assigned in the partition agreement — Written partition agreement not intended by the parties to be a complete record of their agreement — Parties agreed orally that the values of the units would be reassessed on a final accounting —Oral agreement not inconsistent with the terms of the written agreement —Values of the distributed units to be determined according to their true market value — Whether the account should recognise a liability of the partnership to the defendant's building company in respect of a margin on construction costs — The partners agreed that the builder would not be entitled to a margin on construction costs — No liability should be included on the taking of the account for a liability to pay a margin to the builder — Whether an adjustment is required in respect of the refund received by the defendant for GST paid by the partnership —Tax treatment of units distributed to individual partners does not affect an assessment of whether profits have been distributed equally — No adjustment to be made on the taking of accounts in respect of the GST issue identified by the plaintiff Legislation Cited: Partnership Act 1892 (NSW) Duties Act 1997 (NSW) A New Tax System (Goods and Services Tax) Act 1999 (Cth) Cases Cited: Maybury v Atlantic Union Co Ltd (1953) 89 CLR 507 Hoyt's Pty Ltd v Spencer (1919) 27 CLR 133 B & R Stevens Transport Pty Ltd v Burkitt [2016] NSWCA 259 Texts Cited: K L Fletcher, The Law of Partnership in Australia, (9th ed 2007, LawBook Co) R, l'Anson Banks, Lindley and Banks on Partnership, (19th ed 2010, Thomson Reuters) Category: Principal judgment Parties: Abignano Nominees Pty Ltd (Plaintiff) Sheripeter Pty Ltd (Defendant) Representation: Counsel: S A Wells (Plaintiff) R Weaver (Defendant)