Investa Properties Pty Ltd v Nankervis

BETWEEN: INVESTA PROPERTIES PTY LTD (ACN 084 407 241)

OLIVER HUME SOUTH EAST QUEENSLAND PTY LTD (ACN 128 863 230)

JUDGE: COLLIER J DATE: 10 OCTOBER 2013 PLACE: BRISBANE

REASONS FOR JUDGMENT 1 Earlier in 2013 I refused the applicants leave to file an amended statement of claim in the form then presented to the Court: Investa Properties Pty Ltd v Nankervis (No 2) [2013] FCA 468. On 1 October 2013 the applicants returned to Court with an updated version of a draft statement of claim, the untracked version of which was marked as exhibit AB in this proceeding. They seek leave pursuant to r 16.53 of the Federal Court Rules 2011 (Cth) to file both this document as well as an amended originating application, the untracked version of which is annexed as TK-2 to the affidavit of Tean Kerr filed 2 October 2013. The second and fourth respondents oppose an order granting the applicants leave to file these documents. I note that the applicants and the third respondent have now settled the proceeding between them, and that the first respondent does not cavil with the current version of the draft statement of claim or the proposed amended originating application. 2 The substantive trial in this proceeding has been listed for June 2014. It follows that this is not a situation where an application to amend pleadings is made in circumstances where the management of this case and the management of other proceedings before the Court are affected (cf Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175). 3 As was the case in respect of the applicants' previous application to amend the statement of claim, the second and fourth respondents cavil with specific issues concerning the draft. Those issues may be summarised as being that, on the current state of the pleading: 1. The first applicant has no cause of action. 2. The applicants have not properly pleaded incorporation into the contract between the applicants and the second and fourth respondents of the code of conduct for agents as set out in the Property Agents and Motor Dealers (Real Estate Agency Practice Code of Conduct) Regulation 2001 (Qld) ("PAMDA Code of Conduct"). 3. The applicants have not properly pleaded the engagement of the fourth respondent as agent. 4. The applicants improperly seek duplication of remedies against the second and fourth respondents. 4 Further, the second and fourth respondents rely on the judgment in Investa Properties Pty Ltd v Nankervis (No 2) [2013] FCA 468 and submit that the draft currently before the Court replicates the same flaws as were addressed in that decision. 5 It was common ground at the hearing that, in considering an application for leave to amend a statement of claim on its merits, the Court should only deny the applicant the opportunity to prosecute its amended case where satisfied that the applicant has no reasonable prospects of success. 6 As it is clear that the four issues to which I have referred represent the only substantive objections of the second and fourth respondents to the draft statement of claim advanced by the applicants, I now turn to consideration of these issues.

1. The first applicant has no cause of action 7 In Investa Properties Pty Ltd v Nankervis (No 2) [2013] FCA 468 I found that the facts pleaded in the draft statement of claim before the Court did not support a claim that the first applicant was the active company in dealings with the second and fourth respondents. This was in circumstances where paragraphs 1 and 2 of the draft statement of claim, at that time, read:
   1. The First Applicant is and was at all material times: a. a duly incorporated company; b. able to sue in and by its corporate name and style; and c. engaged via its subsidiaries in the business of property development, operating development sites at Bellflower Road, Sippy Downs, Sunshine Coast, Queensland (the Bellflower Site) and Cardena Drive (off Augusta Parkway), Augustine Heights, Ipswich, Queensland (the Brentwood Site).
   2. The Second Applicant (formerly known as Clarendon Residential Group Pty Ltd) a. is, and was at all material times, a wholly owned subsidiary of the First Applicant; b. was at all material times: i. the registered proprietor of the land the subject of these proceedings, and as such; ii. the entity that contracted with real estate agents in connection with the sales and marketing of the land the subject of these proceedings; and iii. the vendor in contracts of sale of the land the subject of these proceedings. 8 In the current draft statement of claim before the Court, the applicants now seek leave to plead as follows:
   3. The first applicant, Investa Properties Pty. Ltd., is and was at all material times: a. A duly incorporated company; and b. Able to sue in and by its corporate name and style. 1A. At all material times: a. Investa Properties was part of a group of companies known as the Investa Property Group, the ultimate holding company of which was Investa Property Group Holdings Pty. Ltd. b. Investa Properties acted as the land development division of the Investa Property Group (in which capacity it was also known and referred to as "Investa Land"). c. For the purposes of carrying out land development, Investa Properties: i. employed all staff of the Investa Property Group; ii. maintained offices and equipment; iii. engaged architects, planners, engineers, other professional consultants, builders and contractors; iv. provided or arranged finance for the purpose of acquiring and developing land; v. incorporated or acquired subsidiaries for the purposes of acquiring land at its direction, holding the legal title to land on its behalf, selling land at its direction, and remitting the proceeds of sale at its direction; and vi. through its directors, officers and employees, implemented the policy decisions of Investa Property Group Holdings Pty. Ltd. and made all managerial-level decisions relating to the acquisition, development and sale of land, 1B. At all material times, Investa Properties was engaged in the development of a site at Cardena Drive (off Augusta Parkway), Augustine Heights, Ipswich, Queensland (the Brentwood Site).
   4. The second applicant, Investa Residential Group Pty. Ltd. (formerly known as Clarendon Residential Group Pty. Ltd.): a. is, and was at all material times, part of the Investa Property Group; b. is, and was at all material times, a wholly owned subsidiary of Investa Properties; and c. was at all material times: i. the registered proprietor of the land the subject of these proceedings, holding that land at Investa Properties' direction; and as such, ii. the entity that, at the direction of Investa Properties, contracted with real estate agents in connection with the sales and marketing of the land the subject of these proceedings; and iii. the vendor, at the direction of Investa Properties, in the contracts of sale of the land the subject of these proceedings. 9 The respondents object to the applicants' claim that the first applicant was active in dealing with the second and fourth respondents (on the basis of a fiduciary relationship between the first applicant and the second or fourth respondents in relation to Lot 170) on the grounds that, in summary: The first applicant was not the registered proprietor of any of the subject lands, had no entitlement to any claim for profits or monies for breach of contract or for any other contravention in relation to the subject land. There continues to be no genuine attempt in new paragraphs 1, 1A, 1B and 2 to plead any proper basis for a claim being maintained by the first applicant in the current draft statement of claim. The proposed pleading is misleading in that it states that the second applicant was at all material times a wholly owned subsidiary of the first applicant. That this is not the case is demonstrated by the material already before the Court. While new factual allegations are made in the draft statement of claim, they do not alter the basic premise of the case sought to be run by the first applicant, which the Court has found is not capable of supporting the existence of a fiduciary duty owed to the first applicant by the second or fourth respondents. 10 In my view it is appropriate to grant the applicants leave to plead in terms of paragraphs 1, 1A, 1B and 2 of the draft statement of claim. 11 First, the fundamental question before the Court is whether the facts as pleaded can support the claim which is made. In this case the applicants have pleaded, in substantial terms in paragraphs 1, 1A, 1B and 2, facts supporting a claim by the first applicant that it was active in respect of relevant dealings with the respondents. 12 Second, the second and fourth respondents have submitted that the material before the Court does not support these pleadings. An inevitable feature of the present stage of this litigation is that the evidence has not yet closed. The issue of the role of the first applicant is clearly in dispute, however having pleaded a case the applicants ought not be denied the opportunity to support it with evidence. 13 Third, the grounds of objection advanced by the second and fourth respondents are in the nature of submissions which could be run at trial. It is premature and inappropriate to determine substantive issues at this stage of the proceeding and on such material as is before the Court. 14 Fourth, I am not satisfied that the applicants have no reasonable prospect of success in respect of this aspect of the claim. 15 Finally, the relevant pleadings before me in Investa Properties Pty Ltd v Nankervis (No 2) [2013] FCA 468 were of a completely different nature to those now sought to be advanced by the applicants. I am not satisfied that merely because I refused the applicants leave previously, they should be refused leave again, particularly in view of the manner in which the claim has now been framed.

2. The applicants have not properly pleaded incorporation into the contract of the PAMDA Code of Conduct 16 In Investa Properties Pty Ltd v Nankervis (No 2) [2013] FCA 468 the applicants pleaded in paragraph 31 of the (then) draft statement of claim: 31. The following term was an express term of the Agent Agreements (Agent Agreements Express Terms): When performing this service, the agent must comply with the code of conduct for agents as set out in the Property Agents and Motor Dealers (Real Estate Agency Practice Code of Conduct) Regulations 2001 (Qld). 17 In relation to this paragraph I observed as follows: [61] In my view it is at least an arguable proposition that, by course of conduct between the relevant applicant and the fourth respondent involving execution of PAMDA form 22a documents, the notation after the signature clause could have been incorporated into the contract between them such that the provisions of the Code of Conduct also became terms of the contract of appointment. However at present the draft statement of claim does not plead facts supporting such an allegation. The applicants will need to amend paragraph 31 should they decide to pursue such an allegation. 18 Relevantly, in paragraphs 102A-102G of the draft statement of claim before the Court the applicants now plead as follows: 102A. By the agreement alleged in paragraph 26A above, Investa Residential Group appointed Oliver Hume SEQ as real estate agent, and Oliver Hume SEQ agreed to provide real estate agent services, in connection with the sale and marketing of Lot 191. 102B. The agreement alleged in paragraph 26A above contained the following notice: When performing this service, the agent must comply with the code of conduct for agents as set out in the Property Agents and Motor Dealers (Real Estate Agency Practice Code of Conduct) Regulation 2001 (Qld). 102C. The notice was positioned on the same page as, and immediately after, the space provided for the real estate agent's signature, so as to bring it to the attention of the person signing the agreement before he or she signed it. 102D. Barclay, on behalf of Oliver Hume SEQ, signed the agreement in the space provided for the real estate agent's signature. 102E. The agreement was in a standard prescribed form. Barclay had signed other agreements in this form many times previously, and was familiar with its terms, including the notice. Particulars (i) Form 22a Appointment of real estate agent (sales and purchases) has been an approved form under the Property Agents and Motor Dealers Act 2000 since 1 July 2001. (ii) From 15 March 2004, Barclay was employed by Oliver Hume SEQ as its Sales Manager. (iii) Barclay was a licenced real estate agent pursuant to the PAMD Act: A. From 19 March 2004 until 19 March 2007, Barclay was a real estate agent principal. B. From 19 March 2004, or alternatively from 19 March 2007, until 19 March 2010, Barclay was a real estate agent employed. (iv) Barclay was nominated as the officer in effective control of Oliver Hume SEQ's Corporate Licence from 2006. (v) From 11 December 2007 until 14 April 2011, Barclay was authorised by Oliver Hume SEQ to sign documents on its behalf including PAMD Act forms. (vi) From 11 December 2007 Barclay was the only director of Oliver Hume SEQ resident in Queensland. (vii) On 30 September 2008, Barclay executed on behalf of Oliver Hume SEQ the form 22a alleged in paragraph 26 above. 102F. The notice was sufficiently brought to Barclay's attention before he signed the agreement. 102G. Because of the facts alleged in paragraphs 102B to 102F above: (i) The terms of the notice were incorporated into the agreement as a contractual term; and accordingly, (ii) The agreement contained an express term to the effect that, when performing the services that the agreement provided for, Oliver Hume SEQ must comply with the code of conduct for agents as set out in the Property Agents and Motor Dealers (Real Estate Agency Practice Code of Conduct) Regulation. 19 In summary, the respondents submit: There has been no genuine attempt to rectify the defects of the previous draft statement of claim. The applicants have not included sufficient material facts and particulars to establish some type of course of conduct whereby the PAMDA notification was incorporated into the contract, but rather have made a series of bare assertions. Paragraph 102E pleads a conclusion rather than material facts properly supported by particulars. Any facts pursued at trial to support the various pleas - for example, that Mr Barclay had previously signed other agreements - must necessarily take the fourth respondent by surprise. At its highest the pleading is that the necessity for compliance by the real estate agent with the PAMDA Code of Conduct was part of the contract. The actual terms of the PAMDA Code of Conduct were not thereby incorporated into the contract between the parties. 20 In my view leave should be granted to the applicants to plead paragraphs 102A-102G. 21 First, as I have already noted, a key question for the Court is whether material facts are pleaded to support the allegations made. The pleadings must furnish a statement of the case sufficiently clear to allow the other party a fair opportunity to meet it, and define the issues for decision in the litigation (Gould and Birbeck and Bacon v Mount Oxide Mines Ltd (In liq) (1916) 22 CLR 490 at 517; Dare v Pulham (1982) 148 CLR 658 at 664). Inter alia, the applicants claim in paragraphs 102A-102G that the terms of the PAMDA Code of Conduct were incorporated into the relevant contract because: in the course of his employment Mr Barclay had signed other agreements in this form on previous occasions, and was familiar with its terms, including the notice relating to the PAMDA Code of Conduct. Mr Barclay was a senior employee of the fourth respondent, and had signed the relevant agreement on behalf of the fourth respondent. 22 These are clear allegations, which can be accepted or denied by the respondents. I am not satisfied that the applicants have no reasonable prospect of success in respect of this claim. 23 Second, I do not accept the submission of the respondents that the applicants have made no effort to amend this aspect of the draft statement of claim since delivery of judgment. New material facts have clearly been pleaded. Provided material facts are pleaded, it is not necessary for the Court to form a view whether paragraphs 102A-102G could have been more effectively drafted. The Court does not look for perfection in pleadings - only at whether material facts are pleaded to support relevant claims. 24 Third, it is not for the Court at this stage to assess the merits of these claims which, in my view, the respondents are inviting the Court to do. The merits of this proceeding are issues for the trial. 25 Fourth, whether the terms of the PAMDA Code of Conduct were actually incorporated into the contract invariably involves questions of mixed fact and law, including whether there had been a relevant course of conduct and whether the notation referring to the PAMDA Code of Conduct only was part of the contract or whether the actual terms were incorporated. Such complex questions are, again, issues for trial, provided material facts are pleaded to support the applicants' claims. 26 Fifth, it is premature for the fourth respondent to submit that facts pursued at trial will take it by surprise. This is because: Final evidence has not yet been filed in this proceeding, in circumstances where the pleadings have not closed. In any event, as is the case in any hearing, a party surprised with allegations not previously made or evidence not previously produced is entitled to make objections to admissibility. 27 Finally, I am not persuaded that paragraph 102E pleads merely a conclusion rather than material facts. Rather, the applicants plead material facts, which are then particularised. Again, it is not for the Court to comment on whether the drafting of paragraph 102E could bear improvement.

3. The applicants have not properly pleaded the engagement of the fourth respondent as agent 28 The respondents object to paragraphs 162A-162G of the draft statement of claim, which provide as follows: LOT 170 BRENTWOOD SITE 162A. By letter of 16 July 2008, Investa Residential Group offered Oliver Hume SEQ the commission for the en globo sale of Lot 170 Brentwood Site (also known as "the Fossil Site"). Particulars (i) The letter is from Clarendon Residential Group - the former name of Investa Residential Group - over the signature of Nankervis as "Development Manager, Residential". (ii) The letter is addressed to the Oliver Hume Real Estate Group. (iii) Oliver Hume SEQ was the only member of the Oliver Hume Real Estate Group carrying on business as a real estate agency in Queensland, and as such, the only entity capable of receiving and acting upon such an offer. (iv) Accordingly, the letter must be taken to have been directed to Oliver Hume SEQ. 162B. Further and alternatively, by email of 27 November 2008, Nankervis, acting for either Investa Properties or Investa Residential Group or both of them, offered Oliver Hume SEQ, a commission for the en globo sale of the Fossil Site. 162C. Thereafter, Oliver Hume SEQ, by Barclay, provided services in connection with the sale and marketing of the Fossil Site. Particulars Of Services In Connection With The Sale And Marketing Of Lot 170 (i) Oliver Hume Real Estate Group - "Brentwood - Augusta Pkwy, Augustine Heights (Queensland) Market Analysis Report" dated 25 September 2008; (ii) email dated 25 November 2008 providing recommended pricing for the Brittains Road site; (iii) email dated 2 December 2008 from Barclay to Nankervis in relation to potential purchaser; (iv) email dated 2 December 2008 from Barclay to Nankervis and Gavin Stubbs providing an activity update concerning the Fossil Site, including an update concerning discussions with potential purchasers; (v) email dated 2 December 2008 from Barclay to a potential purchaser, David Tonuri, and Gavin Stubbs attaching various analyses, reports and valuations; (vi) email dated 2 December 2008 from Barclay confirming instructions from Nankervis on behalf of Investa Properties and Investa Residential Group; (vii) email exchanges between Barclay, Nankervis and Gavin Stubbs in relation to weekly reports provided by Barclay: i. 2 December 2008; ii. 8 December 2008 at 11:57 am; iii. 8 December 2008 at 12:27 pm; iv. 8 December 2008 at 12:35 pm; v. 15 December 2008; vi. 8 January 2009; vii. 12 January 2009; viii. 19 January 2009; ix. 22 January 2009; x. 23 January 2009; xi. 27 January 2009; (viii) email 12 December 2009 from Nankervis to Barclay in relation to the Adjoining Site; (ix) email 16 December 2008 from Nankervis to Barclay and potential purchaser, David Tonuri in relation to Earthworks Quantity Differences; (x) email 19 December 2008 from Barclay to potential purchaser, David Tonuri, and Nankervis attaching previous contract and other documents relating to Lot 170; (xi) email dated 20 January 2009 from Barclay to potential purchaser, David Tonuri, attaching an Amended Slope Plan Analysis; (xii) email dated 3 February 2009 from Barclay to potential purchaser, David Tonuri, and Nankervis; (xiii) email dated 12 February 2009 from Barclay to potential purchaser, David Tonuri, attaching Contract of Sale, Special Conditions and Put and Call Option; and (xiv) email dated 20 February 2009, from Nankervis to Barclay in relation to Details for Contract of Sale to Two Eight Two Nine Pty. Ltd. 162D. Further and alternatively, Oliver Hume SEQ and Barclay were in a position of confidence in relation to Investa Properties and Investa Residential Group in connection with the sale and marketing of the Fossil Site because: (a) Investa Residential Group engaged Oliver Hume SEQ, and thereby Barclay, to provide services to Investa Residential Group in connection with the sales and marketing of other lots in the Brentwood site; (b) pursuant to that engagement, Oliver Hume SEQ, by Barclay, provided services to Investa Properties and Investa Residential Group in connection with the sales and marketing of other lots in the Brentwood site; (c) while acting in the course of that engagement and otherwise because of it, Barclay and Oliver Hume SEQ acquired knowledge of the Fossil Site, including plans, approvals, reports and valuations relating to it and proposals affecting it; (d) while acting in the course of that engagement and otherwise because of it, Barclay and Oliver Hume SEQ also acquired knowledge of Investa Properties and Investa Residential Group's intentions and requirements in relation to the sale and marketing of the Fossil Site; (e) Barclay and Oliver Hume SEQ provided services in connection with the sale and marketing of the Fossil Site, particulars of which are given in paragraph 162C above; and (f) Investa Properties and Investa Residential Group, on the one hand, and Barclay and Oliver Hume SEQ, on the other, acted throughout on the basis that Barclay and Oliver Hume SEQ were acting in the interests of Investa Properties and Investa Residential Group in relation to the sales and marketing of the properties in the Brentwood site, including the Fossil Site. 162E. Because of facts alleged above, Oliver Hume SEQ had fiduciary obligations to Investa Properties and Investa Residential Group while providing services in relation to Lot 170: (i) To act in good faith and with fidelity; (ii) To avoid and disclose to Investa Properties or to Investa Residential Group all actual or perceived conflicts of interest; (iii) To act in the best interests of Investa Properties and Investa Residential Group; (iv) To give Investa Properties and Investa Residential Group the full benefit of the knowledge and skill of its employees, and in particular, to pass on to Investa Properties or to Investa Residential Group all information that it or they had about the marketing and sale of the properties that were the subject of its appointment that might be relevant to the marketing and sale; (v) Not to profit from its position, and not to allow its employees to profit, other than by receiving remuneration in accordance with its appointment, without full disclosure to and the informed consent of Investa Properties and Investa Residential Group; and (vi) Not to assist: Any person with whom it or any of its employees was associated; or Any entity in which it, or any of its employees, or a person whom it or any of its employees was associated with or had an interest in; or Any person or entity from whom or from which it or any of its employees could expect a benefit, to purchase Lot 170, without full disclosure to and the informed consent of Investa Properties and Investa Residential Group. 162F. Further and alternatively, as is alleged in more detail in paragraphs 29 and 30 above, and in particular, in paragraph 29(f), Barclay: (a) Was employed to perform Oliver Hume SEQ's obligations as a real estate agent to Investa Properties and Investa Residential Group; and (b) As alleged in paragraph 162C above, was involved in a significant way in providing Oliver Hume SEQ's services to Investa Properties and Investa Residential Group in relation to Lot 170. 162G. Because of the facts alleged in paragraphs 162D and 162F above, Barclay had fiduciary obligations to Investa Properties and Investa Residential Group while providing services in relation to Lot 170: (i) To act in good faith and with fidelity; (ii) To avoid and to disclose to Investa Properties or to Investa Residential Group all actual or perceived conflicts of interest; (iii) To act in the best interests of Investa Properties and Investa Residential Group; (iv) To give Investa Properties and Investa Residential Group the full benefit of his knowledge and skill, and in particular, to pass on to Investa Properties or to Investa Residential Group all information that he had about the marketing and sale of the properties that were the subject of his employment that might be relevant to the marketing and sale; (v) Not profit from his position, other than by receiving remuneration in the course of his employment, without full disclosure to and the informed consent of and [sic] Investa Properties and Investa Residential Group; and (vi) Not to assist: • Any person with whom he was associated; or • Any entity in which he, or a person with whom he was associated, had an interest; or • Any person or entity from whom he could expect a benefit, to purchase Lot 170, without full disclosure to and the informed consent of Investa Properties and Investa Residential Group. 29 The second and fourth respondents object to these paragraphs of the draft statement of claim on the basis that, in summary, the applicants make reference in paragraph 162D to an "engagement" of the fourth respondent by the applicants in circumstances where, in Investa Properties Pty Ltd v Nankervis (No 2) [2013] FCA 468: the Court did not accept that any pleaded facts supported a claim that both applicants offered the fourth respondent and/or the second respondent the commission for the sale of Lot 170; and the Court found that only an appointment complying with the statutory requirements of s 134 of the Property Agents and Motor Dealers Act 2000 (Qld) would be effective. 30 The second and fourth respondents also submit that there is very little difference between paragraphs 162A-162E of the draft statement of claim currently before the Court, and paragraphs 36A-36H of the draft statement of claim the subject of previous decision by this Court. 31 While there is some similarity between the current paragraphs and paragraphs 36A-36H of the previous draft, I am satisfied that, in the draft statement of claim currently before the Court, the applicants have satisfactorily pleaded a case that, in reliance upon specified correspondence: the applicants offered the fourth respondent a commission for the sale of Lot 170; sales and marketing services were provided by the fourth respondent and the second respondent; and a position of confidence existed between the fourth and second respondents, and the applicants. 32 I consider that the reframing of this claim, the addition of further material facts, and the further particularisation of the facts pleaded, are adequate to support the allegations made. I also note that, earlier in this judgment, I have dealt with the issue of the first applicant maintaining a valid cause of action against the second and fourth respondents. 33 I am not satisfied that the applicants have no reasonable prospect of success in relation to this aspect of the claim. 34 In my view the applicants should be given leave to plead these paragraphs.

4. The applicants improperly seek duplication of remedies against the second and fourth respondents 35 Finally, the second and fourth respondents submit that the draft statement of claim is fundamentally flawed because the relief claimed by the applicants offends the reflective loss rule. Specifically: Paragraphs 234 and 235 of the draft statement of claim read as follows: 234. At the election of Investa Properties and Investa Residential Group, Barclay must account as a defaulting fiduciary to Investa Properties and Investa Residential Group for either: (1) Any profit that he or any entity that was associated with him, or that he controlled, made or derived from the sale of Lot 170 to Two Eight Two Nine Pty. Ltd., or from the development or resale of Lot 170; or: (2) The value of Lot 170 at the time of sale. The value of the property was $3,000,000 but Investa Residential Group received only $1,454,545. 235. Alternatively, Barclay must give equitable compensation, in such form and in such amount as the Court in its discretion considers just, to Investa Properties and Investa Residential Group for the sale of Lot 170 at an undervalue. The loss claimed by the first applicant is the same loss as is claimed by the second applicant. In this case the first applicant is an indirect shareholder of the second applicant. Mr O'Brien for the second respondent directed my attention to comments of McPherson JA in Thomas v D'Arcy [2005] 1 Qd R 666 at [7] where his Honour - quoting Johnson v Gore Wood & Co [2002] 2 AC 1 - cited relevant principles as including: (1) Where a company suffers loss caused by a breach of duty owed to it, only the company may sue in respect of that loss. No action lies at the suit of a shareholder suing in that capacity and no other to make good a diminution in the value of the shareholder's shareholding where that merely reflects the loss suffered by the company… (2) … (3) Where a company suffers loss caused by a breach of duty to it, and a shareholder suffers a loss separate and distinct from that suffered by the company caused by breach of a duty independently owed to the shareholder, each may sue to recover the loss caused to it by beach of the duty owed to it but neither may recover the loss caused to the other by breach of the duty owed to that other…. 36 In Thomas v D'Arcy the defendants were principals in a firm of solicitors retained to advise a number of related corporations and a director of the holding company of the corporate group. Advice given by the defendants related to loans to one of the subsidiary companies in the group. The director commenced proceedings against the defendants for damages for, inter alia, negligence. The trial judge struck out part of the director's statement of claim on the basis that, in substance, the director sought damages for his loss resulting from diminution in the value of his shares due to actions of a receiver appointed to the corporate assets, in circumstances where the relevant company was the proper plaintiff. The Court of Appeal of Queensland dismissed the appeal. 37 In light of such authorities as Tang Man Sit v Capacious Investments Ltd [1996] 1 AC 514 and Warman International Ltd v Dwyer (1995) 182 CLR 544 the respondents do not cavil with the prospect of an election being made in respect of available remedies at an appropriate juncture. They do, however, submit that the position of the applicants in the case before me can be equated with the relevant parties in Thomas v D'Arcy. 38 I do not agree. The applicants have pleaded, inter alia, that they are jointly or alternatively entitled to compensation from the respondents. The facts are not, in my view, comparable with those in Thomas v D'Arcy where it was clear that, in summary, the relevant claim had been brought by the wrong party. I further accept the submissions of Mr Murr SC that any relief given by the Court in its equitable jurisdiction can be conditional so as to avoid duplication of remedy. In my view the manner in which relief is pleaded in this case is not a reason to refuse leave to the applicants to file the draft originating application and the draft statement of claim.

Conclusion 39 In the circumstances I consider the appropriate order is to grant leave to the applicants to file the draft amended originating application (changes to which reflect proposed amendments to the statement of claim) and the draft amended statement of claim currently before the Court. 40 Further, while the fourth respondent submitted that costs ought be reserved, I see no reason why costs ought not follow the event. The applicants are entitled to their costs from the second and fourth respondents of and incidental to the hearing of 1 October 2013. I certify that the preceding forty (40) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Collier.