Coastal Karts Pty Ltd v Bellandra Holdings Pty Ltd

REEVES J: 1 Bellandra Holdings Pty Ltd and Mr Shane Bellingham, the respondents in this proceeding, have applied for summary judgment under s 31A(2) of the Federal Court Act 1976 (Cth) (the FCA) and r 26.01 of the Federal Court Rules 2011 (Cth) (the Rules). The application arises in the following factual context. 2 Bellandra Holdings is the trustee of the Bellandra Family Trust. In that capacity, it operates a number of businesses, including one trading under the name "Eco Noosa" (the Business). In September 2018, Mr Bellingham, the sole director of Bellandra Holdings, advertised the Business for sale on the website Gumtree. Between 18 September 2018 and 24 October 2018, Mr Michael Wallent and Ms Arahina Hawkes, acting on behalf of Coastal Karts Pty Ltd, entered into negotiations with Mr Bellingham to purchase the Business. Mr Wallent and Ms Hawkes were at all material times the directors of Coastal Karts. 3 On 22 November 2018, Bellandra Holdings and Coastal Karts entered into a contract for the sale and purchase of the Business for the sum of $330,000 (the Contract). The Contract was settled on 26 November 2018, at which point the parties entered into a vendor finance agreement under which Bellandra Holdings advanced a part of the purchase price of the Business (the Vendor Finance Agreement). 4 By notice given on 31 July 2019, Coastal Karts purported to rescind the Contract and the Vendor Finance Agreement. On the next day, Coastal Karts filed an originating application and an accompanying statement of claim (later amended) in which it alleged that Bellandra Holdings had breached the Contract and had engaged in misleading and deceptive conduct in association with the sale of the Business. 5 On 28 August 2019, Bellandra Holdings was ordered to file its defence by 17 September 2019 and Coastal Karts was ordered to file any reply by 1 October 2019. In its defence, Bellandra Holdings disputed Coastal Karts' claims and filed a cross-claim for unpaid monies allegedly due and payable under the Vendor Finance Agreement. 6 On 25 September 2019, before the pleading process was complete, Bellandra Holdings filed the present application. In it, it seeks summary judgment against Coastal Karts in respect of its claims, as well as summary judgment in favour of Bellandra Holdings in respect of its cross-claim. 7 In November 2019, the parties were granted leave to amend their pleadings. At the same time, they were ordered to exchange materials in respect of the present application and the matter was referred for mediation. The dispute was not settled at that mediation. No orders have since been made for the disclosure of documents or requiring the exchange of evidence to be adduced at trial. 8 In its amended statement of claim, Coastal Karts alleged that Mr Bellingham made misleading or deceptive representations to Mr Wallent in contravention of s 18 of the Australian Consumer Law (Schedule 2 to the Competition and Consumer Act 2010 (Cth)) regarding the financial position of the Business (the profitability representations) and concerning the state of the plant and equipment sold as part of that business (the P&E representations). It also made a breach of contract claim arising out of the same factual circumstances. 9 The profitability representations were set out at [14] of Coastal Karts' amended statement of claim as follows: Prior to entry into the Contract as pleaded at paragraph 10 above, [Mr] Bellingham, on behalf of [Bellandra Holdings], represented to [Mr] Wallent on behalf of [Coastal Karts] (together, the Profitability Representations), that: (a) The Business had turned over $150,969.63 in sales for the year ended 30 June 2018 with $93,608.54 of net profit (June 2018 Figures); (b) The Business had made the June 2018 Figures over the course of seven months of trading with the Business operating five days per week; (c) The income statement for the Business which contained the June 2018 Figures was accurate and complete in every respect; (d) The Business was actually making in excess of the June 2018 Figures; (e) The Business would be profitable in future years; (f) The Business provided steady, consistent income; (g) The Business was a turn-key sale; (h) In approximately May 2018 the Business had expanded to incorporate another business known as "Nauticycle Noosa" (Nauticycles), providing a further revenue stream; (i) By in or around September 2018 the Business had expanded to include "Noosa Stand Up Paddle", providing a further revenue stream. (Emphasis in original; particulars omitted) 10 Coastal Karts claimed these representations were misleading or deceptive because (at [18]): … (a) The Business did not generate the June 2018 Figures; (b) The Business was not able to generate a profit as reflected by the June 2018 Figures; (c) The Business could not feasibly make the profit reflected by the June 2018 Figures in future years; (d) The Business was not capable of providing a steady, consistent income; (e) "Noosa Stand Up Paddle" had not been incorporated into the Business; (f) "Nauticycles" had not been incorporated into the Business; (g) The June 2018 Figures did not disclose what part of the income was attributable to use of an eco boat, the Lady Anne, which was not included as part of the plant and equipment in the sale of the Business. 11 The P&E representations were set out at [20] of the amended statement of claim as follows: Prior to entry into the Contract as pleaded at paragraph 10 above, [Mr] Bellingham, on behalf of [Bellandra Holdings], represented to [Mr] Wallent on behalf of [Coastal Karts]: (a) that two luxury eco boats were in Full Commercial Survey; (b) that the plant and equipment to be sold as part of the Business was in good working order and condition at that time; and (c) impliedly that the plant and equipment to be sold as part of the Business would continue to be in good working order and condition as at the date of settlement (together, the Plant and Equipment Representations). (Emphasis in original; particulars omitted) 12 Coastal Karts claimed that these representations were misleading or deceptive because (at [24]): … (a) The Luxury Eco Boats were not in Full Commercial Survey but were Survey Exempt. (b) Both Luxury Eco Boats are now out of operation due to failed motor controllers that cannot be fixed without significant expenditures. (c) Both Luxury Eco Boats require new drive train components, new electrical components, writing looms and modifications to make them reliable and suitable for purpose. (d) Both Luxury Eco Boats required new batteries, with one requiring a complete new set of batteries. (e) Two electric pedal boats did not have motors and were inoperable as electric vehicles. (f) One electric pedal boat has a faulty steering mechanism. (g) The Eco Boat covers required replacing. (h) The umbrellas required replacing. 13 At [26] of its amended statement of claim, Coastal Karts claimed that, in reliance on the profitability and P&E representations, "on or around 22 November 2018, [it] entered into the Contract with [Bellandra Holdings]." At [28] it claimed that it had "suffered loss and damage by reason of [Bellandra Holdings'] contravention of s18 of the ACL". Finally, Coastal Karts pleaded (at [31]) that, by reason of the same circumstances, Bellandra Holdings had "breached clause 8.1(i) of the Contract". Clause 8.1(i) of the Contract provided: [Bellandra Holdings] states and assures [Coastal Karts] that except as otherwise disclosed in this Contract: … (i) the trading figures and other financial data relating to the Business, particulars of which are set out in any schedule, annexure or appendix to this Contract, are true and correct in every particular. 14 In its amended defence, Bellandra Holdings denied the allegations at [14] of Coastal Karts' amended statement of claim (see [9] above) and pleaded (at [5]-[6]): 5. [Bellandra Holdings and Mr Bellingham] deny the allegations pleaded in subparagraph 14(a) to 14(d) of the [amended] Statement of Claim, because: (a) the June 2018 Figures to which [Coastal Karts, Mr Wallent and Ms Hawkes] refer were provided to [Mr Wallent] on 19 September 2018; (b) the June 2018 Figures constituted indicative trading figures for the businesses known as: (i) 'Eco Noosa'; (ii) 'Nauticycle Noosa'; (iii) 'Noosa Stand Up Paddle', given, as at 19 September 2018, [Coastal Karts] was contemplating acquiring all three of these businesses' assets in its purchase of the Business; (c) by subsequent negotiation between [Mr Bellingham] on behalf of [Bellandra Holdings] and [Mr Wallent] on behalf of [Coastal Karts] between 30 September 2018 and 2 October 2018, the assets of the business known as 'Noosa Stand Up Paddle' were excluded from the Contract and not sold as part of the Business; (d) within those negotiations, [Mr Bellingham] advised [Mr Wallent]: (i) that [Bellandra Holdings] had previously agreed to purchase 'Noosa Stand Up Paddle' from its then-current owner and include it in the sale of the Business to [Coastal Karts] at settlement; (ii) that one of the reasons for including 'Noosa Stand Up Paddle' in the sale of the Business was because it had been operating for over 12 months and had solid financials; (iii) that accordingly the business of 'Noosa Stand Up Paddle' helped with the overall package of the Business; however (iv) another prospective buyer of the Business had recently advised [Bellandra Holdings] that they did not want to include the assets of the business known as 'Noosa Stand Up Paddle' in their purchase of the Business, and that [Bellandra Holdings] was willing to offer to sell the Business to [Coastal Karts] on the same basis, and on the same terms. (e) at a meeting between [Mr Bellingham] on behalf of [Bellandra Holdings] and [Mr Wallent] on behalf of [Coastal Karts] at the Business premises on a date between 21 October 2018 and 22 October 2018, [Mr Bellingham] provided [Mr Wallent] with a copy of the June 2018 Figures with hand written amendments to reflect the exclusion of 'Noosa Stand Up Paddle' from the business sale ("the Amended June 2018 Figures"); (f) the Amended June 2018 Figures: (i) showed a reduction in profit from $93,608.54 to $32,186.88 as compared to the June 2018 Figures; (ii) reflected the indicative trading figures for the Business eventually sold to [Coastal Karts] pursuant to the Contract as a matter of fact; and (iii) had the effect of superseding the June 2018 Figures originally provided by [Mr Bellingham]; (g) as a consequence of the matters pleaded in subparagraphs (a) to (e) herein, the June 2018 Figures were not and could not be a representation of the trading figures of the Business that was the eventual subject of the Contract; (h) accordingly, [Bellandra Holdings and Mr Bellingham]: (i) deny having made any of the Profitability Representations in respect of the Business as pleaded therein; (ii) say that the June 2018 Figures were not and could not have constituted a representation as to the trading figures of the Business that was eventually the subject of the Contract; (iii) say that [Coastal Karts, Mr Wallent and Ms Hawkes] knew or ought to reasonably have known that the June 2018 Figures were an amalgamation of the trading figures for the businesses known as 'Eco Noosa', 'Nauticycle Noosa' and 'Noosa Stand Up Paddle'; and (iv) say that when the parties agreed to exclude the assets of the business known as 'Noosa Stand Up Paddle' from the sale of the Business in the circumstances pleaded in subparagraphs (c) and (d) herein, [Coastal Karts, Mr Wallent and Ms Hawkes] knew or ought to reasonably have known that the June 2018 Figures no longer represented a true reflection of the trading performance of the Business that would pass to [Coastal Karts] at settlement of the Contract. 6. [Bellandra Holdings and Mr Bellingham] admit [Mr Bellingham] made statements to the effect of the representations pleaded in subparagraphs 14(e), 14(f), 14(g), 14(h) and 14(i) of the [amended] Statement of Claim, however: (a) say that because such statements were made prior to the exclusion of 'Noosa Stand Up Paddle' from the transaction in the circumstances pleaded in paragraph 5 herein, they did not constitute representations as to the Business that was eventually sold pursuant to the Contract; (b) deny such statements provided any guarantee, warranty, promise or assurance as to the future profitability of the Business; (c) deny [Mr Bellingham] made any representation by silence by failing to disclose the fact that the June 2018 figures constituted the amalgamation of three separate businesses, by reason of the matters pleaded in paragraphs 5(c), (d), (e) and (f) herein. (Emphasis in original; particulars omitted) 15 Bellandra Holdings also denied the allegations at [20] of Coastal Karts' amended statement of claim (see [11] above) and pleaded (at [11]-[12]): 11. [Bellandra Holdings and Mr Bellingham] deny the allegation pleaded in subparagraph 20(a) of the [amended] Statement of Claim, because: (a) whilst [Bellandra Holdings and Mr Bellingham] admit the list of plant and equipment provided that two luxury eco boats were in full commercial survey, the true state of affairs was that the boats in question were instead exempt from survey; (b) [Mr Wallent], on behalf of [Coastal Karts], himself brought this fact to [Mr Bellingham's] attention after [Mr Bellingham] had sent him a copy of the certificates of operation for the boats on 7 October 2018; (c) on 22 October 2018 [Mr Bellingham] provided to [Mr Wallent] a copy of the relevant certificates of exemption as evidence of this fact; (d) in the premises, [Coastal Karts, Mr Wallent and Ms Hawkes] were well aware of the true state of affairs, being that the boats were exempt from survey, prior to entering into the Contract; (e) accordingly, [Coastal Karts] was not induced to enter into the Contract by any false or misleading representation on the part of [Bellandra Holdings and Mr Bellingham] in this regard. 12. [Bellandra Holdings and Mr Bellingham] deny the allegations pleaded in subparagraphs 20(b) and 20(c) of the [amended] Statement of Claim, because: (a) [Bellandra Holdings and Mr Bellingham] made no such representations; and (b) by reason of Special Condition 7.2 of the Contract, [Bellandra Holdings and Mr Bellingham] did not provide any warranty in relation to the items listed as plant and equipment, and by this clause [Coastal Karts] was required to make its own investigations and satisfy itself as to the working order and condition of each of the items listed therein prior to the entering into of the Contract. 16 As for Coastal Karts' breach of the contract claim (see at [13] above), Bellandra Holdings denied that it had breached cl 8.1(i) because (at [20]): … (a) the Amended June 2018 Trading Figures provided by [Mr Bellingham] to [Coastal Karts, Mr Wallent and Ms Hawkes] prior to [Coastal Karts'] entry into the Contract reflected the true trading figures for the Business eventually sold to [Coastal Karts] pursuant to the Contract; and (b) in any event, clause 8.1(i) of the Standard Conditions did not apply to the Contract for the reasons pleaded in subparagraph 3(c) herein. 17 Furthermore, Bellandra Holdings denied, at [3(c)] of the amended defence, that cl 8.1(i) of the standard conditions applied in the circumstances because: … (i) no particulars of any trading figures or other financial data relating to the Business were set out in any schedule, annexure or appendix to the Contract; (ii) by Special Condition 4.2 of the Contract, [Coastal Karts] acknowledged and agreed that it had reviewed and satisfied itself in relation to the verification of the books and records of the Business prior to signing the Contract; and (iii) by reason of Special Condition 1.3 of the Contract, to the extent of any inconsistency between Special Condition 4.2 and Standard Condition 8.1(i) of the Contract, Special Condition 4.2 prevailed. 18 In its amended reply, Coastal Karts provided the following response (at [3]-[6]) to the denials pleaded at [5] of Bellandra Holdings' amended defence (see [14] above): 3. As to sub-paragraph 5(b) of the [amended] Defence, [Coastal Karts, Mr Wallent and Ms Hawkes): (a) Do not know whether the June 2018 Figures in fact constituted indicative trading figures for separate businesses known as Nauticycles and 'Noosa Stand Up Paddle' (SUP), in addition to the figures for [the Business], and therefore cannot admit that allegation. (b) Say that as at 19 September 2018 [Mr] Wallent on behalf of [Coastal Karts] was contemplating acquiring the Business, which he understood had incorporated the Nauticycles and SUP businesses from May 2018 and September 2018 respectively, because of the matters pleaded in sub-paragraphs 14(h) and (i) of the [amended] Statement of Claim, but otherwise denies that [Coastal Karts] contemplated the matters set out therein. (c) Say that: (i) The June 2018 Figures did not indicate they were a consolidated set of trading figures for three separate businesses. (ii) The incorporation of the trading figures for SUP into the June 2018 Figures (which cannot be admitted) is inconsistent with the [Bellandra Holdings' and Mr Bellingham's] admissions at paragraph 6 of the [amended] Defence, and [Coastal Karts, Mr Wallent and Ms Hawkes] repeat and rely on sub­paragraph 14(i) of the [amended] Statement of Claim. (iii) To the extent that [Bellandra Holdings and Mr Bellingham] are alleging that any more than two months of trading figures for Nauticycles were incorporated into the June 2018 Figures (which cannot be admitted), that is inconsistent with [Bellandra Holdings' and Mr Bellingham's] admissions at paragraph 6 of the [amended] Defence, and [Coastal Karts, Mr Wallent and Ms Hawkes] repeat and rely on sub-paragraph 14(h) of the [amended] Statement of Claim. (iv) [Bellandra Holdings and Mr Bellingham] were not entitled to incorporate the trading figures from Nauticycles into the June 2018 Figures, given that they had not incorporated Nauticycles into the Business as they had represented, and in that respect [Coastal Karts, Mr Wallent and Ms Hawkes] repeat and rely on sub-paragraph 18(f) of the [amended] Statement of Claim. (v) At no time prior to [Coastal Karts'] entry into the Contract did [Bellandra Holdings and Mr Bellingham] inform [Coastal Karts, Mr Wallent and Ms Hawkes] that the June 2018 Figures were a consolidated set of trading figures for three separate businesses. (vi) If the June 2018 Figures were in fact a consolidated set of trading figures for three separate businesses, which cannot be admitted, then [Bellandra Holdings' and Mr Bellingham's] silence as pleaded in sub-paragraph 3(c)(v) above was misleading and deceptive and forms part of the conduct relied upon in relation to the Profitability Representations. 4. As to sub-paragraph 5(c) of the [amended] Defence, [Coastal Karts, Mr Wallent and Ms Hawkes] say that [Mr] Wallent informed [Mr] Bellingham by email on 2 October 2018 that [Coastal Karts] did not wish to purchase any stand-up paddle boards but otherwise [Coastal Karts, Mr Wallent and Ms Hawkes] deny the allegations because [Bellandra Holdings] did not purchase SUP and was unable to do so as part of the proposed sale from [Bellandra Holdings] to [Coastal Karts]. 4A. [Coastal Karts, Mr Wallent and Ms Hawkes] deny the allegations in sub-paragraph 5(d) of the [amended] Defence because the matters set out in sub-paragraphs (i) to (iv) do not accurately convey the text messages exchanged between [Mr] Bellingham and [Mr] Wallent at 6.49pm and 8.12pm on 30 September 2018, and [Coastal Karts, Mr Wallent and Ms Hawkes] rely on the terms of those text messages for their full meaning and effect and repeat and otherwise rely on paragraph 4 of this [amended] Reply. 5. As to sub-paragraph 5(e) of the [amended] Defence, [Coastal Karts, Mr Wallent and Ms Hawkes]: (b) Admit that [Mr] Wallent met with [Mr] Bellingham in person when he travelled to Noosa between 20 and 25 October 2018. (c) Otherwise deny the allegations therein because at no time did [Mr] Bellingham: (i) Provide to [Mr] Wallent a copy of the 'Amended June 2018 Figures' as defined in sub-paragraph 5(e) of the [amended] Defence or at all. (ii) Advise [Coastal Karts, Mr Wallent and Ms Hawkes] that there were any material omissions in or amendments required to the June 2018 Figures. 6. As to sub-paragraph 5(f) of the [amended] Defence, [Coastal Karts, Mr Wallent and Ms Hawkes]: (aa) Say that they have reviewed a copy of the document labelled as Annexure "SB22" to the affidavit affirmed by [Mr] Bellingham on 18 September 2019 and filed in this proceeding on 25 September 2019, but that this was the first time they had seen a copy of that document. (a) Say that they have not seen a copy of the 'Amended June 2018 Figures' as defined in sub-paragraph 5(e) of the [amended] Defence at the time it is alleged to have been provided or at all and therefore cannot admit the allegations of fact contained in sub-paragraphs (i) and (ii) therein. (b) Deny the allegation of fact contained in sub-paragraph (iii) therein because of the matters pleaded in paragraph 5 of this [amended] Reply, and repeat and rely on paragraphs 14, 17, 26 and 27 of the [amended] Statement of Claim. (Emphasis in original) 19 Further, in relation to the allegations in [11] of the amended defence (see [15] above), Coastal Karts responded in its amended reply (at [11]): As to paragraph 11 of the [amended] Defence, [Coastal Karts, Mr Wallent and Ms Hawkes]: (a) Admit that the certificates of operation were provided to [Mr] Wallent on 7 October 2018 as pleaded in sub-paragraph (b) therein, but deny that [Mr] Wallent informed [Mr] Bellingham that the boats were survey exempt after being provided with these certificates because those certificates did not indicate the boats are survey exempt. (b) Deny the allegations contained in sub-paragraphs 11(c)-(e) therein because [Mr] Wallent was not provided with the Certificates of Survey until 28 November 2018, after settlement. (c) Repeat and rely on sub-paragraphs 20(a), 23 and 24(a) of the [amended] Statement of Claim. 20 Section 31A of the FCA relevantly provides: … (2) The Court may give judgment for one party against another in relation to the whole or any part of a proceeding if: (a) the first party is defending the proceeding or that part of the proceeding; and (b) the Court is satisfied that the other party has no reasonable prospect of successfully prosecuting the proceeding or that part of the proceeding. (3) For the purposes of this section, a defence or a proceeding or part of a proceeding need not be: (a) hopeless; or (b) bound to fail; for it to have no reasonable prospect of success. … 21 With the exception that it does not contain a provision similar to s 31A(3) above, r 26.01(1)(a), under which this application is also brought, contains an identical test to that set out in s 31A(2) above. 22 While each party placed greater emphasis on different parts of the decision, there was no dispute that the principles applicable to a summary judgment application of this kind were outlined in Australian Securities and Investments Commission v Cassimatis (2013) 220 FCR 256; [2013] FCA 641 (Cassimatis). 23 In particular, Bellandra Holdings emphasised [54]-[64] of Cassimatis and the conclusion reached at [65]. It also relied upon the judgments of Finkelstein and Gordon JJ in Jefferson Ford Pty Ltd v Ford Motor Company of Australia Limited (2008) 167 FCR 372; [2008] FCAFC 60 (at [23] and [126]-[127] respectively). In doing so, it accepted that the onus of proof rested on it. However, it contended that, in assessing whether it had discharged that onus, the Court was required to take account of both the pleadings and the whole of the evidence put before it by each of the parties. On that footing, it contended that it had adduced substantial materials to support its defence to the substantive proceeding and that Coastal Karts had failed to adduce any materials to establish its claims. Accordingly, Bellandra Holdings contended that Coastal Karts had no reasonable prospects of prosecuting its claims and the proceeding should therefore be summarily dismissed. 24 For its part, Coastal Karts emphasised [46]-[47] of Cassimatis and contended that its claims, as pleaded, could not be described as fanciful and nor did they hinge on a question of law that could be determined summarily. Instead, Coastal Karts argued that the pleadings demonstrated a substantial and extensive factual dispute between the parties which should be determined at trial. Further, it contended that the material exchanged in support of this application contained hearsay; the contentious aspects of that material had not been tested; and, as such, it could not be treated as if it were evidence exchanged for the purposes of the trial. 25 Additionally, Coastal Karts contended that there were 14 live areas of dispute between the parties, including whether the sale related to three businesses or one; whether the June 2018 figures related to three businesses or one; and whether the amended figures were ever provided. With respect to the claim for breach of contract, it contended that Bellandra Holdings' amended defence was fallacious as the central question in the misleading and deceptive conduct claim was whether the figures that were provided were misleading or deceptive.

CONSIDERATION 26 While s 31A of the FCA has certainly lowered the bar on an application of this kind, the Court must still proceed with caution in deciding to determine a proceeding summarily (see Cassimatis at [50]). Further, in Cassimatis I noted that a pertinent consideration was the stage the proceedings had reached (at [46]). In that respect, it is to be noted that Bellandra Holdings' application was made before the pleadings had closed in this proceeding and at a very early stage of it. Hence, disclosure of documents had not been sought, or provided, and there had been no exchange of evidentiary materials in preparation for trial. 27 As for the exchange of material that has occurred in connection with this application, I agree with Coastal Karts' submissions that, because that material relates to an interlocutory proceeding, it can, and does, contain hearsay material. Furthermore, and perhaps more importantly, that material has not been tested as it would be at trial. Given those factors, I do not accept Bellandra Holdings' contention that it has advanced sufficient evidentiary materials to establish a prima facie case requiring a response from Coastal Karts. To the contrary, having regard to the nature and extent of the contested allegations of fact elaborated in the pleadings and the whole of the affidavit evidence that has been filed in support of this application, I consider there is a substantial and real, or genuine, factual dispute between the parties that can only be determined at trial. It is plainly evident from the review of the pleadings at [8]-[19] above that those factual disputes are numerous. They include how many businesses were included in the sale, to what business or businesses the financial information that was provided by Bellandra Holdings related, and whether any amended financial information was provided. 28 The issues of fact and credibility relating to the first two aspects above are amply demonstrated in the corresponding parts of the affidavits filed in this application by Mr Bellingham, on behalf of Bellandra Holdings, and Mr Wallent, on behalf of Coastal Karts, concerning the conversation that occurred on or about 18 September 2018: Mr Bellingham's affidavit dated 18 September 2018: 13. I recall informing him during this conversation words to the effect that: (a) I had two other interested buyers for the Business, and it was for sale for $365,000; (b) the sale was to buy three businesses in one because the owners of the other businesses (Nauticycle Noosa and Noosa Stand Up Paddle) wanted to sell and move on and we had packaged their assets together as the combined Business; (c) I wouldn't send through all the financials for the three businesses without [Mr Wallent] first signing a confidentiality agreement; and (d) I would email some further information to him. Mr Wallent's affidavit dated 14 November 2018: 9. During that conversation, Mr Bellingham said to me words to the following effect: (a) The purchase price for [the Business] was $365,000. (b) There were two other prospective buyers interested in purchasing [the Business]. (c) He had incorporated new products into [the Business] over the previous 10 months, which had increased the revenue of the business. (d) He would send to me some information about [the Business] and a confidentiality agreement for me to sign. (e) After I had signed the confidentiality agreement, he would provide me with the financial information for [the Business]. 10. I refer to sub-paragraphs 13(b) and (c) of Mr Bellingham's Affidavit. 11. During our conversation, Mr Bellingham: (a) Did not say to me anything about the sale comprising three separate businesses, being Eco Noosa, Nauticycle Noosa and Noosa Stand Up Paddle; (b) Only spoke about one business, and that was Eco Noosa; and (c) Did not say anything to indicate there were other businesses involved in the sale, or that he would be sending me financial information in relation to any other businesses. 29 Finally, I also agree with Coastal Karts regarding the breach of contract claim. It is no answer to that claim to say that Coastal Karts satisfied itself by reference to materials which it claims were misleading and deceptive.

CONCLUSION 30 For these reasons, I do not consider Bellandra Holdings has established that Coastal Karts has no reasonable prospects of successfully prosecuting any part of this proceeding, including its defence to Bellandra Holdings' cross-claim. Accordingly, its application for summary judgment must be dismissed with costs. 31 The orders will be:

1. The respondents' interlocutory application filed 25 September 2019 is dismissed.
2. The respondents pay the applicants' costs of and incidental to that application to be taxed failing agreement.
3. The parties prepare and submit to Chambers draft programming orders to achieve a trial of this proceeding. I certify that the preceding thirty-one (31) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Reeves.

SCHEDULE OF PARTIES QUD 478 of 2019 Cross-Respondents Second Cross-Respondent MICHAEL PAUL WALLENT Third Cross-Respondent ARAHINA EUNICE HAWKES