Charles John RYMAN and Valmai RYMAN v SEYMOUR CBD PTY LTD - [1997] FCA 124 - FCA 1997 case summary — Zoe

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Charles John RYMAN and Valmai RYMAN v SEYMOUR CBD PTY LTD

[1997] FCA 124

Federal Court of Australia|1997-02-28|Before: Mason CJ, Dawson JJ, As Dixon J, Spender J

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At a glance

Source facts

Court

Federal Court of Australia

Decision date

1997-02-28

Before

Mason CJ, Dawson JJ, As Dixon J, Spender J

Source

Original judgment source is linked above.

Judgment (23 paragraphs)

[1]

" 2 (1) Where in any proceeding it appears to the Court that in relation to the proceeding generally or in relation to any claim for relief in the proceeding - (a) no reasonable cause of action is disclosed; (b) the proceeding is frivolous or vexatious; or (c) the proceeding is an abuse of the process of the Court,

[2]

the Court may order that the proceeding be stayed or dismissed generally or in relation to any claim for relief in the proceeding." It is contended on behalf of Seymour that the case for the applicants in the principal proceedings, Mr Charles John Ryman and Mrs Valmai Ryman ('the Rymans'), must fail as being inherently incredible. In considering this contention, it is necessary to refer in detail to the evidence before the court concerning the misrepresentations pleaded. In the alternative, it is contended on behalf of Seymour that the principal proceedings involve an abuse of process, because the evidence establishes that the proceedings were not brought by the Rymans to enforce or vindicate any rights which they may have. Rather, Seymour alleges that the proceedings were brought to pressure Seymour into delaying or deferring completion of the contract at the centre of the Rymans' statement of claim. There is no dispute about the principles to be applied concerning the summary termination of proceedings. In Webster v Lampard (1993) 177 CLR 598 at 602, Mason CJ, Deane and Dawson JJ said:

[3]

" It is important to note at the outset that the issue before the learned Master on the application for summary judgment was not whether Mr. and Mrs. Webster would probably succeed in their action against Sergeant Lampard. It was whether the material before the Master demonstrated that that action should not be permitted to go to trial in the ordinary way because it was apparent that it must fail. The power to order summary judgment must be exercised with 'exceptional caution:' General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) (1964), 112 C.L.R. 125, at p. 129 and 'should never be exercised unless it is clear that there is no real question to be tried' Fancourt v Mercantile Credits Ltd (1983), 154 C.L.R. 87, at p. 99. As Dixon J. commented in Dey. v Victorian Railways Commissioners (1949) 78 C.L.R. 62, at p. 91: ' A case must be very clear indeed to justify the summary intervention of the court to prevent a plaintiff submitting his case for determination in the appointed manner by the court with or without a jury. The fact that a transaction is intricate may not disentitle the court to examine a cause of action alleged to grow out of it for the purpose of seeing whether the proceeding amounts to an abuse of process or is vexatious. But once it appears that there is a real question to be determined whether of fact or law and that the rights of the parties depend upon it, then it is not competent for the court to dismiss the action as frivolous and vexatious and an abuse of process.' Nowhere is that need for exceptional caution more important than in a case where the ultimate outcome turns upon the resolution of some disputed issue or issues of fact. In such a case, it is essential that 'great care...be exercised to ensure that under the guise of achieving expeditious finality a plaintiff is not improperly deprived of his opportunity for the trial of his case by the appointed tribunal' General Steel Industries Inc. v. Commissioner for Railways (N.S.W.) (1964), 112 C.L.R., at p. 130; see also, Church of Scientology Inc. v Woodward (1982), 154 C.L.R. 25, at p. 31." In General Steel (supra), Barwick CJ said at 129:

[9]

" ...the present proceeding is an abuse of process not only because it is 'foredoomed to fail'. Quite apart from its merits or prospects of success, the claim is an abuse of process because it is brought as a means of obtaining some advantage for which such proceedings are not designed or some collateral advantage beyond what the law offers: Williams v Spautz (1992) 174 CLR 509; Goldsmith v Sperrings Ltd [1977] 1 WLR 478; [1977] 2 All ER 566; Packer v Meagher [1984] 3 NSWLR 486 at 492; Re Majory; Ex parte a Debtor [1955] Ch 600; Grainger v Hill (1838) 4 Bing (NC) 212; 132 ER 769." The statement of claim which is the subject of attack in the present motion is disarmingly orthodox. The applicants plead that by an instrument in writing dated 21 April 1994, they agreed to purchase a proposed lot, being a three bedroom apartment in 'Admiralty Towers' from Seymour for the sum of $545,000.00. The Rymans allege that in negotiations in contemplation of such an agreement, one Michelle Harris, ('Ms Harris') who was a real estate agent with L J Hooker Brisbane Project Marketing, (the real estate company retained by Seymour as its agent to sell the apartment development, 'Admiralty Towers'), made certain oral representations to the Rymans; namely, that upon completion of construction, the three bedroom apartments in 'Admiralty Towers' would rent for the sum of $1,000.00 per week and that all lots or proposed lots in the development had been sold except for two three bedroom apartments. The conversation is said to have taken place at the site office of L J Hooker on or about 6 November 1993. It is said that there were no reasonable grounds for making the representation as to rental and that the representation as to sales was false. The applicants plead that in reliance upon those representations, they signed the agreement dated 21 April 1994 and provided bank guarantees in the sum of $54,500.00. The Rymans claim that by letter from their solicitors dated 29 July 1996, they rescinded the agreement.

[19]

" The acquisition of a unit in Admiralty Towers II was independent of this transaction." In the light of the authorities to which I have referred, I am very conscious that if there is any dispute of fact relevant to the existence of a claim which the applicants wish to make, I ought not to entertain any application for the summary termination of the principal proceedings. Here, in my opinion, the position is that notwithstanding the terms of the applicants' statement of claim, the uncontradicted evidence is that on 6 November 1993 the Rymans agreed to purchase a two bedroom unit, Unit 72, on the 11th floor of Admiralty Towers I. Next, the evidence, not denied, is that on 6 January 1994 the Rymans told Ms Harris that they wanted to purchase Unit 119, a three bedroom unit on the 19th level of Admiralty Towers I and that they intended to live in that unit. On 11 January 1994, the Rymans informed Ms Harris that they wished to purchase another three-bedroom unit, this time in Admiralty Towers II, but that they could only proceed with that purchase if Seymour would be prepared to rescind the contract of sale for the two-bedroom unit in Admiralty Towers I. The question whether the statement of claim is frivolous or vexatious as disclosing no real cause of action is not answered simply by looking at the terms of the statement of claim in a factual vacuum. If, notwithstanding what appears in the pleading, the uncontradicted facts are contrary to those which are pleaded, justice dictates that reality, or substance, should triumph over form. In the present application, I am not attempting to make any assessment of credibility but dealing only with evidence which is not in dispute or which is not challenged. On that basis, I am satisfied that the proceedings should be struck out pursuant to O 20 r 2. Of the two representations alleged, that concerning the non-availability of two bedroom units is demonstrably false. It could not have been made. I do not, however, take into account the effect of that conclusion on the reliability or credit of Mr Ryman for the purposes of considering other issues. On the day of the second alleged representation concerning rental income for the three bedroom units, (the making of which is denied in the sworn affidavit of Ms Harris), the Rymans had in fact agreed to purchase a two bedroom unit. In relation to the later decision to agree to purchase a three bedroom unit, Unit 119, the subject of the statement of claim, the uncontradicted evidence of Ms Harris is that the Rymans, at the time of communication of the decision to purchase that unit, indicated that they intended to live in the unit. I accept that there might have been some transferred relevance for that later decision in whatever may have been said on 6 November 1993. However, in light of the statement made by the Rymans of their intention to live in Unit 119, any representation by Ms Harris about the rental income of three bedroom units could not have been a causative factor in their decision to enter into the contract to purchase Unit 119; that decision was made some time in 1994 in consequence of an agreement to rescind the contract for Unit 72 . I am conscious that there have been suggestions that the role of courts in dismissing matters in a summary way for want of merit should be widened. The rules in the Federal jurisdiction, however, despite such suggestions, are benevolent in the extreme, and it is only in the clearest case that one ought to determine that proceedings should be summarily dismissed. On the material before me, I am of the view that it would be manifestly unfair to the respondent to permit the bald allegations contained in the statement of claim to continue in the face of the admitted or uncontradicted evidence led before me. The administration of justice, in my view, would be brought into disrepute by countenancing what in my considered assessment is a 'try on' dressed up as an arguable case. The second basis for dismissing the application asserts that these proceedings were initiated, not for the "protection or vindication of particular legal rights or immunities, the maintenance or affection of particular legal relationships, and the imposition or enforcement of particular legal penalties, liabilities and obligations", (adopting the words of Brennan J in Williams v Spautz (supra) at 532), but for the collateral purpose of pressuring the vendor under the contract to grant an extension of time for completion. The contract to purchase Unit 119, a three bedroom unit in 'Admiralty Towers I' is dated 21 April 1994. On 1 December 1995, the Rymans' then solicitors, Astills, wrote to the solicitors for Seymour seeking a variation to the contract in respect of Unit 119 as follows:

[23]

" On instructions from our clients, we have issued an Application out of the Federal Court of Australia, Brisbane District Registry for appropriate relief. A copy of the Application with the annexed Statement of Claim will be served on you in due course. We have been instructed to seek from you an undertaking that your client will not make demand under the bank guarantees provided by our client pending determination of the Federal Court proceedings. We have also been instructed to seek from your client an undertaking that you will not cause the trustee and stakeholder (under the Contract) to make such demand under the bank guarantee. Should such an undertaking not be provided by 4.30pm, Monday, 29 July 1996 we will proceed for interlocutory relief before the Federal Court immediately." At 4.00pm that afternoon, Seymour's solicitors were served with a document which bore a filing stamp "Registrar in Bankruptcy State of Queensland 29 July 1996". That statement of claim recited in paragraph 9(b) that the respondent had failed or refused to give the undertaking referred to in the letter of rescission. In fact, that statement of claim had been stamped by an officer of the Court on 29 July 1996 with an incorrect stamp and delivered to the articled clerk of the Rymans' solicitors who, in turn, had served that document that afternoon. On 31 July 1996, a solicitor for the Rymans attended at Seymour's solicitors' office but the Rymans did not settle and it is agreed that the Rymans did not have arrangements in place to settle on 31 July 1996. A properly stamped copy of the statement of claim bearing the filing date of 1 August 1996 was served on the solicitors for Seymour on 13 August 1996. Quite independently of my view expressed earlier, that the proceedings are without any merit and bound to fail, I am satisfied that in this case the proceedings initiated by the Rymans in this court had the predominant purpose of seeking to achieve the attempts that otherwise had been unsuccessful in pressuring Seymour into delaying or deferring completion of the contract. This conclusion is supported by the consideration that the first time that complaints of misrepresentations were particularised was in the letter of 29 July 1996, just two days before the contract was due to settle and after an application for a further postponement of settlement had been refused. The second of the claimed representations is manifestly untenable in that contrary to Mr Ryman's recollection, he had, on 6 November 1993, agreed with his wife to purchase a two bedroom unit, Unit 72. The representation concerning rental (raised for the first time at deathknock) is quite inconsistent as an inducing factor, with the unchallenged evidence that the Rymans wished to live in Unit 119. The offer to "attempt to settle the potential litigation" with Seymour is nothing more than an attempt to secure an extension of time from them on the same terms as the previous six months extension. On this ground also I would dismiss the principal proceedings by the Rymans. I will hear the parties on costs. I certify that this and the preceding nineteen (19) pages are a true copy of the reasons for judgment herein of the Honourable Justice Spender. Associate Date: 28 February 1997 Counsel for the applicant : Mr H B Fraser QC instructed by : Burns Jameson Counsel for the respondent : Mr P A Keane QC with Mr A M Daubney instructed by : Stubbs Barbeler Grant Date of hearing : 24 September 1996