Omniveta Australia Pty Ltd v Modern AZ Kitchens Pty Ltd [2015] NSWDC 431

District Court New South Wales

Medium Neutral Citation: Omniveta Australia Pty Ltd v Modern AZ Kitchens Pty Ltd [2015] NSWDC 431 Hearing dates: 13 October 2015 Date of orders: 13 October 2015 Decision date: 13 October 2015 Jurisdiction: Civil Before: P Taylor SC DCJ Decision: (1) Judgment in favour of the plaintiff against the second defendant in the sum of $211,306.03 (including $14,610.14 for interest). (2) The second defendant to pay the plaintiff's costs of, and incidental to, the assessment hearing. (3) Order that the exhibit be returned forthwith (and returned in court). Catchwords: DAMAGES – assessment of damages – misleading conduct – knowing involvement by director – factoring arrangement – invoices not genuine – proof of damage – value of judgment against company Legislation Cited: Uniform Civil Procedure Rules 2005, r 16.3, r 16.7, r 30.1, Form 39 Category: Principal judgment Parties: Omniveta Australia Pty Ltd ACN 160 834 579 (plaintiff) Modern AZ Kitchens Pty Ltd ACN 150 770 648 (first defendant) Aaron Alan Jackson (second defendant) Representation: Counsel: Mr J Stephens (plaintiff)

Solicitors: Whittens & McKeough (plaintiff) File Number(s): 2014/329028 Publication restriction: None

Judgment

THE CLAIM 1. Omniveta Australia Pty Ltd seeks an assessment of its damages arising from the involvement of the second defendant, Aaron Jackson, in the misleading conduct by his company, the first defendant, Modern AZ Kitchens Pty Ltd.

BACKGROUND 1. Omniveta is a factoring company. It entered into an agreement with Modern AZ Kitchens to purchase certain invoices by an advance of 85% of the value of the invoices of Modern AZ Kitchens. By the agreement, Modern AZ Kitchens warranted that the goods and services the subject of the invoices had been ordered by the customers, had been delivered or performed by Modern AZ Kitchens, and that there was no dispute in respect of the invoices. Any dispute by the customer as to liability created an entitlement in Omniveta under the agreement to recover from Modern AZ Kitchens the full amount of the relevant invoices. 2. By payment of a total sum of $196,695.89, Omniveta purchased invoices of Modern AZ Kitchens totalling $231,406.89. Omniveta received no funds from the customers. It commenced proceedings against Modern AZ Kitchens and Mr Jackson, the sole director and shareholder of Modern AZ Kitchens who signed the agreement. The verified statement of claim alleged that "there were no debts or contracts between Modern AZ Kitchens and any customers of Modern AZ Kitchens in the terms of the customer invoices" and "the customer invoices are valueless and...have always been valueless". 3. The claim against Modern AZ Kitchens was for a contractual debt and for breach of contract and misleading conduct in relation to the invoices. The claim against Mr Jackson was for knowing involvement in misleading conduct.