Judgment - ex tempore (aPPLICATION for dismissal for want of evidence)
By her Further Amended Statement of Claim filed today, by leave, the Plaintiff, Ms Romona Kraissa claims damages for breach of contract, or alternatively repayment of certain monies allegedly paid to the Defendants, Mr Steve Choukair and Mr Mohamad Choukair and other relief. This is the second day of the hearing and two affidavits of Ms Kraissa have been read and two affidavits of her brother have also been read. Both Ms Kraissa and her brother have been cross-examined. Ms Painter, who appears for Ms Kraissa, has closed her case.
Mr Chan, who appears for the Defendants, then sought a judgment for want of evidence under r 29.10 of the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR") which provides, in the relevant circumstances, that the Defendants may apply to the Court to give judgment either generally or in any claim for relief on the ground that, on the evidence given, a judgment for the Plaintiff could not be supported. That application may be made, as it has been here, at any time after the conclusion of the evidence of the Plaintiff in her case in chief. Rule 29.10(3) in turn provides that the Court may not give judgment under the rule unless, in this case, the Defendants satisfied the Court that, on the evidence given, judgment for the Plaintiff could not be supported. The application brought by the Defendants in turn has consequences for their ability to lead evidence, except by leave of the Court.
The application brought by the Defendants under UCPR r 29.10 is analogous to a "no case" submission at general law, which could be made on the basis that the evidence was insufficient or so unsatisfactory that the Court could not act upon it, or where a case could not be established as a matter of law: Union Bank of Australia Ltd v Puddy [1949] VLR 242 at 244. In dealing with the application, the Court must determine whether the evidence is reasonably capable of satisfying it, as a tribunal of fact, that the matters sought to be proved have been established. In doing so, the Court is not of course, finding those matters, as it would in a final judgment, but merely finding that the evidence led would be capable of satisfying it of those matters.
The matters that need to be established in such an application were in turn summarised by Hamilton J in Australian Securities and Investments Commission v Sydney Investment House Equities Pty Ltd [2008] NSWSC 814, by reference to r 29.10 of the UCPR. His Honour refers to earlier decisions at an appellant level which have considered the sufficiency of evidence in respect of such an application. His Honour noted, by reference to that authority, that the test to be adopted is that of a, "jury basis," namely whether a verdict by a jury based on the relevant evidence would, if challenged, necessarily be set aside. His Honour also noted, again by reference to authority, that the test applicable in an application of this kind is whether a finding in the plaintiff's favour could be made on the evidence as it stood, not whether or not it should be made. His Honour also referred to the relevance of an assessment of the quality of evidence in such an application, recognising that a jury might, for example, give greater weight to some aspects of evidence than others, or give lesser weight to particular concessions, and that a trial judge would ordinarily have to regard evidence as uncontradicted in determining whether there is a case to go to the jury, unless it is withdrawn in the course of a party's evidence.
His Honour summarised the position, in an application under UCPR r 29.10, as directed to the question whether there could be a determination in the plaintiff's favour on the evidence, taking the evidence at its highest, and not a question whether there should be judgment upon the evidence in that situation.
With that background, the Plaintiff's case, and Mr Chan's submissions in respect of the application for judgment for want of evidence under UCPR r 29.10, each focus upon dealings in respect of two entities, Hair Industrie Penrith Pty Ltd (deregistered) ("HIP") and Hair Industrie Merrylands Pty Ltd ("HIM"). Mr Chan contends that the evidence in respect of both companies could not satisfy the Court, as a matter of evidence, or as a matter of law, as to the Plaintiff's case for breach of contract or for recovery of the amounts claimed. I had indicated, after hearing argument in the matter, that I was not satisfied that I could properly give judgment for want of evidence in favour of the Defendants in this application. These are my reasons for holding that view.
Mr Chan submitted, in respect of both companies, that the Plaintiff could not establish breach of contract, the terms of which are broadly admitted in respect of HIP, with some qualifications to which the Defendants rely in their affirmative case, and which are in contest in respect of HIM. Mr Chan submitted that the Plaintiff could not show the amount of profits of the companies or the amount which she had actually received, and referred to aspects of the evidence in that regard. Mr Chan made the further submission in respect of HIM that the Court could not be satisfied as to the existence of the relevant contract and, in particular, that Ms Kraissa's claim that she had paid $25,000 in cash to one of the Defendants, without a receipt or other documentation, in respect of the contract to acquire an interest in HIM, was so incredible that it could not possibly be accepted.
Ms Painter, who appears for Ms Kraissa, responds that the Plaintiff can at least show a breach of contract as to HIP since, even on the position accepted in the pleadings, the Defendants had paid Ms Kraissa only a share of cash takings of the business and not a share in takings received by other means, particularly by EFTPOS, a matter to which the Defendants seek to respond in the pleadings by asserting a term of the contract that provided for such payment from dividends, which are also not shown to have been paid. Ms Painter pointed to evidence of EFTPOS takings in respect of one of the companies over part of the period, amounting, it appears, to approximately half of the takings of the company. So far as HIM is concerned, Ms Painter submitted that the application for judgment for want of evidence must fail because, as Mr Chan had accepted in the course of submissions, if a contract existed in the terms alleged by Ms Kraissa, then it had at least been breached by the failure to issue shares to her and, Ms Painter contended, also by the failure to pay her a share of non-cash takings of the business.
So far as the Defendants' judgment for judgment for want of evidence in respect of HIP is concerned, I am satisfied that application must fail. A contractual term that Ms Kraissa was to be paid one-third of the profits of HIP is pleaded and not contested, although the Defendants seek to establish additional terms in respect of the contract which might qualify the operation of that term. Ultimately, both parties appear to read "profits" as equivalent to "takings" or revenue of the companies, rather than as an accounting profit derived by calculating revenue less cost, and I will also proceed on that basis for the purposes of this judgment. I note that, if I did not do so, the alleged contracts would plainly have been breached, since there appears to be no suggestion that the accounting profits of the companies have ever been calculated or any payments made to Ms Kraissa by reference to them.
If a one-third share of the profits is understood, adopting the parties' approach, as amounting to a one-third share of the takings of the companies, then it seems to me that the evidence is capable of supporting the proposition that Ms Kraissa was not paid that share in respect of HIP, so far as she was not paid a share of non-cash takings of HIP. In making that observation, I do not, of course, reach any finding that such a breach is established, but merely that it could be established on the basis of the evidence that presently exists.
Mr Chan's submissions focused on gaps in the evidence as to the quantum of the amount that was due to Ms Kraissa, and that was in fact paid to her. However, it does not seem to me that establishing a breach of contract, or indeed the Plaintiff's success in the case, necessarily requires that she close all relevant gaps in the evidence as to the quantum of damages. If a breach of contract is established, by non-payment to Ms Kraissa of the relevant share of the non-cash takings of the business, then the Court is obliged to do the best it can to reach an assessment of damages, even if the plaintiff has failed to lead all of the evidence available, or the best evidence available, to support such an assessment: Commonwealth of Australia v Amann Aviation Pty Ltd [1991] HCA 84; (1991) 174 CLR 64 at 83, 125, 153. It seems to me that the evidence led in the Plaintiff's case as to the amount of EFTPOS takings, provides at least some basis for such an assessment, albeit a plainly imperfect one. Even if Ms Kraissa did not establish the quantum of her damages, she may nonetheless be entitled to nominal damages for breach of contract, and the Court could not dismiss proceedings, depriving her of that entitlement, where that was an open result on the evidence.
In the case of HIM, the position seems to me to be even clearer. Mr Chan ultimately accepted in submissions that the Defendants' claim for judgment for want of evidence in respect of HIM must turn on a conclusion that the evidence cannot establish the existence of a contract in respect of HIM. If a contract were established in the terms pleaded by the Plaintiff, then it was plainly breached by failure to issue a share in HIM to Ms Kraissa, as well as potentially by a failure to pay one-third of non-cash takings of HIM to Ms Kraissa. As I noted above, in that situation, the Court would again need to do the best it can to determine damages, or nominal damages might have to be awarded if the quantum of damages was not established.
It seems to me that the evidence is capable of supporting a conclusion that a contract existed in respect of HIM, although the Defendants, who have not led evidence at this point, contend to the contrary. Ms Kraissa gives evidence of relevant conversations and of the payment of $25,000 in cash, and her brother gives evidence of witnessing that payment. Mr Chan's strongest point in respect of this claim is that it is unlikely that the amount of $25,000 would have been paid in cash without documentation. Plainly, the payment of $25,000 in cash, without documentation, is imprudent, but history teaches that litigation in this Court arises, from time to time, from imprudent or highly imprudent transactions.
In the present case, it seems to me that there are matters which indicate that Ms Kraissa's evidence as to a cash payment is less incredible than it might otherwise appear, including the fact that the evidence suggests that her share of the takings of HIP was paid to her in cash, so that she would potentially have access to cash, and also that she left school at 14, and had worked with the Defendants for a period after she left school and claims to have trusted them, so dealings in cash and a lack of documentation are not entirely impossible. Again, in putting that view, I am not indicating that Ms Kraissa's evidence in that respect should be accepted, but merely that it could be accepted. It does not seem to me that a jury decision to accept Mr Kraissa's evidence in that respect would be set aside as plainly unreasonable, if the jury reasoned that, even if its members did not deal with large amounts of money in cash themselves, there were other persons within the community who did so. It seems to me that a tribunal of fact could properly accept that evidence, as to the existence of the contract, and Ms Kraissa's and her brother's evidence of payment and, as I have noted, if the contract existed, then a breach and damages, or nominal damages, might well follow.
I am therefore not satisfied, in respect of either the claim in respect of HIP or HIM, that judgment for Ms Kraissa could not be supported on the evidence given, as a matter of evidence or as a matter of law, whether for substantive or nominal damages for breach of contract. I would add that, so far as a restitutionary claim for the moneys paid is brought, I am not satisfied that such a claim could not succeed for the same reasons, although I am of course not reaching any findings as to whether it would succeed.
UCPR r 29.10(3) provides that, where I am not satisfied that judgment could not be supported, then I may not give judgment for the Defendants under that rule. The application for judgment for the Defendants under r 29.10 is therefore dismissed.
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Decision last updated: 25 September 2015