Murray v Duddy [2008] NSWCA 207 | Case summary

29 AUGUST 2008 Wendy Jill MURRAY v Eric Keith DUDDY JUDGMENT 1 ALLSOP P: This is an appeal from orders made by an Associate Judge of the Court in the Common Law Division ordering that there be a verdict and judgment for the defendant. The plaintiff (the appellant in this Court) was ordered to pay the defendant's costs as agreed or assessed. 2 The matter has a long history. A judge of the Court (Shaw J), after a hearing lasting 15 days, dismissed the appellant's claims. See Kyabram Property Investments Pty Ltd v Murray; Murray v Duddy [2004] NSWSC 298. Those orders were set aside by this Court on the basis of inadequacy of reasons by the original trial judge. See Murray v Duddy [2005] NSWCA 55. The matter was remitted to the Common Law Division for re-hearing. Between 3 and 13 April 2006, over nine days, the primary judge (Harrison AsJ) re-heard the case. Judgment was delivered 2 August 2006. See Murray v Duddy [2006] NSWSC 761. 3 An appeal was brought from the orders made on 2 August 2006 and that appeal was called on for hearing in this Court before Ipp JA, Basten JA and Hoeben J on 3 September 2007. On that day, the appellant was unrepresented and applied for an adjournment. An adjournment was granted, but the appellant was ordered to pay the costs thrown away as a result of the adjournment. 4 The appeal was relisted for hearing on 17 July 2008. After appeal books were prepared which contained submissions of the appellant signed by her and submissions of the respondent, the appellant filed further submissions on 11 February 2008. 5 The matter came before the Registrar of the Court of Appeal after February. There can be no doubt that the appellant was fully aware of the date fixed for hearing of her appeal. 6 When the appeal was called on for hearing on 17 July 2008 there was no appearance by or on behalf of the appellant. The matter was called outside the Court. 7 Mr Burchett appeared for the respondent to the appeal. With leave he filed in Court and read an affidavit of Duncan Cameron MacLean, his instructing solicitor. The affidavit contained information concerning the attitude of the appellant to these proceedings. The appellant had made clear to Mr MacLean on Wednesday 16 July that she did not intend to appear in Court on 17 July. She was asked by Mr MacLean whether she was abandoning the appeal to which she said "No". She refused to tell Mr MacLean whether she was applying for an adjournment and said words to the effect "I will look to my position in due course". Mr MacLean then told the appellant that he was booked to come to Sydney on the afternoon flight and he thought he was entitled to know what her position was. Later on Wednesday 16 July 2008, Mr MacLean sent a letter to the appellant at a facsimile number that she had provided to him stating, in the clearest of terms, that he was attending court for the appeal the following day and any adjournment application would be firmly resisted. The letter also warned the appellant that if she did not appear she ran the risk of her appeal being dismissed. 8 Later on Wednesday 16 July, Mr MacLean spoke to the Registrar of the Court of Appeal who told him that Mr Donnelly, an erstwhile legal representative of the appellant, had told the Registrar that he had given the appellant some advice and that he was "not in" the matter. Mr MacLean sent another letter to the appellant. This letter once again forewarned the appellant that the respondent would seek an order that the appeal be dismissed with costs if there was no appearance by or on behalf of the appellant. 9 Mr Burchett, who appeared for the respondent, asked that the matter be dismissed for want of prosecution. After some discussion, the Court indicated to Mr Burchett that given the lack of clarity in the position of the appellant, it could conceivably be thought that the delivery of the further written submissions in February and the rejection of the proposition that the appellant was abandoning the appeal meant that the appellant was making a request for the matter to be dealt with on the papers. Mr Burchett did not object to the Court dealing with the appeal on the papers, that is, on the submissions presently before the Court. To the extent that it could be the position that the appellant was implicitly seeking an adjournment, such application would be and is refused. The above history and the appellant's disregard for the time and costs of others revealed by her non-appearance are sufficient reason for that course. 10 Mr Burchett handed up to the Court a page which had not been included in the Appeal Book which was page 6 of his client's affidavit which commenced at page 152 of Volume 1 of the Appeal Book. The affidavit was dated 8 August 2002. 11 The amended statement of claim, upon which the primary judge decided the case, was filed in court on 3 April 2006. In this document, the plaintiff claimed over $2 million arising out of her purchasing land at the request of the respondent in circumstances which I will describe. In short, the appellant claimed an indemnity as an agent or damages for repudiation of the agency agreement under which she, as agent, at the request of the respondent as principal, committed herself to the purchase of a rural property previously owned and worked by the respondent which was being sold in a mortgagee sale by Westpac Banking Corporation. 12 The appellant's case was that she purchased the land in question as the respondent's agent, committed herself to the funding of it, effected that purchase and subjected herself to liabilities on account of costs, interest and penalty interest and the purchase price less credit for the ultimate sale of the land. The appellant also claimed that the respondent had engaged in fraudulent conduct in what he said to her about the availability of finance to him to put the appellant in a position of being able to pay for the land. 13 The appellant is the adult niece of the respondent, who is an elderly man. The respondent is the appellant's father's brother. In 1967, the appellant married Mr Robert Murray. They have been involved in the management of farming properties in Western Australia and New South Wales for most of their marriage. In 1991, the appellant inherited a property and at about that time she and her husband moved from Western Australia to Boala in New South Wales. The precise background of the appellant and the respondent is not immediately relevant except that they were both members of an established farming family in New South Wales with long experience of rural properties, rural affairs and farming. 14 The structure of the case was as I have earlier generally identified. The appellant pleaded an agency relationship and a contract of agency. The appellant claimed that prior to the settlement of the purchase of the property the respondent had repudiated his undertaking and the contract of agency by stating that he would not and could not fund the purchase. Further, at the time of making the relevant representations that finance had been approved and that he would provide the purchase money for the completion of the property, it was said that he made such representations knowing that they were untrue or alternatively with reckless indifference as to whether they were true or false. Thus the misrepresentation case was one structured as a fraud case. No pleading of trust of the land was made. 15 The primary judge in a careful judgment, if I may respectfully say, dealt with the matter substantially in a chronological fashion moving through the events in question and carefully examining and weighing the competing versions of events. This was not an easy task. One of the difficulties was that by the time the matter was re-heard before the primary judge, Mr Duddy was 79 years old and was not in a position to give any form of reliable evidence. He was called into the witness box and in the few answers that he gave the primary judge formed the definite view that Mr Duddy did not have any useful recollection of the events. The primary judge therefore had to rely upon his previous affidavit evidence that was admitted into evidence and his previous transcript. 16 Mrs Jill Duddy, (the appellant's mother and the respondent's sister-in-law) had also furnished an affidavit and had been cross-examined during the first trial. Mrs Jill Duddy was to give evidence at the trial before the primary judge, but her husband (that is the appellant's father) had died a few days before the trial commenced and Mrs Duddy was unable to give evidence at the trial. Her affidavit and cross-examination were also in evidence. 17 The other important matter to note at the outset is that the primary judge made clear her views as to the evidence of the appellant which was given orally before her and which was the subject of cross-examination, over four days. The primary judge said, after she had carefully observed the appellant, that her Honour concluded that the appellant had become an advocate for her own case and did not feel constrained merely to answer questions but volunteered information that she thought would bolster her case. The primary judge came to the view that the appellant had tailored her evidence to portray herself in the best possible light, and that where there were contemporaneous notes or other documentation in existence and their contents conflicted with the appellant's evidence she preferred that documentation. The primary judge also commented adversely on the appellant's conduct in, effectively, threatening two witnesses. 18 The property in question was called "West Garawan". There was another small property related to its purchase, called "Square Bush". Both properties were in the Gunnedah/Quirindi area of New South Wales. 19 There was no dispute that prior to 9 May 1997 the respondent asked the appellant to bid for him at the auction of "West Garawan". Nor was there any dispute that prior to the auction the respondent had, by words and conduct, represented to the appellant that he had finance available to purchase the property from the appellant after she had settled. 20 The appellant attended the auction. Just prior to its commencement she made certain public statements which would seem to have assisted in dampening the enthusiasm of other bidders. In any event, "West Garawan" was knocked down to the appellant for $1.8 million. The evidence disclosed that the mortgagee, Wespac Banking Corporation, had turned down offers before auction of $2.1 million and $2.4 million. The primary judge found that the appellant was aware of these pre-auction offers and that the appellant was aware that the price she had paid for the property was a very good one indeed. 21 The auction took place on Friday 9 May 1997. The respective versions of events between the appellant and other witnesses diverge insofar as they concern events after the auction. 22 The primary judge dealt with the matter chronologically and examined the evidence in a meticulous way. It is unnecessary to recount in detail all the considerations reflected in the primary judge's reasoning. The following is a summary of the primary judge's fundamental findings. 23 By the evening of 9 May the appellant had decided to retain the property for herself. It is clear that she had decided that she at least wanted some control over the property to try and prevent the respondent getting into further difficulty. That desire for limited control had been articulated by the appellant to her own solicitor in the afternoon of 9 May. The primary judge found that by the evening of 9 May the appellant had decided to keep the property for herself. Her mother's evidence, which was accepted, was consistent with a communication to that effect. There was some contrary evidence in relation to this from the appellant's husband, but his regularly kept diary did not support the proposition that his wife continued to maintain that she had bought the property for her uncle (the respondent). To the contrary, the objective evidence left by Mr Murray in his diary was consistent with his wife having formed the view that she would keep the property for herself. This finding was confirmed when the primary judge dealt with the evidence concerning Monday 12 May. 24 There was a clear conflict of evidence between the appellant and a Mr Leece about a conversation on 12 May. Mr Leece gave evidence at both trials and was cross-examined before the primary judge. According to him, the appellant made it plain to him that she intended to keep the property for herself and needed to arrange finance in that regard. The evidence of Mr Leece was accepted in preference to that of the appellant. This resolution of the conflicting evidence of Mr Leece and the appellant was based in significant part on the advantage the primary judge had of viewing the evidence and the witnesses as well as her Honour's deep immersion in the facts of the case. 25 There was another conflict of evidence about events of 12 May dealt with by the primary judge. The appellant asserted a conversation with the respondent in which the respondent had stated that he had effectively tricked her into bidding and that she was now forced to enter a partnership with him. The respondent denied this conversation. The primary judge made a finding that the conversation did not take place. 26 The primary judge then dealt with various aspects of the conflicting evidence as her Honour moved through the month of May into June. During that analysis, the primary judge was able to conclude, with some confidence, that by 12 May the appellant had started taking steps not only to effect the finance of the property on her own behalf or for herself and her husband as partners, but also that the appellant had sought to find someone to lease or share farm "West Garawan" once the purchase of the property was completed. 27 The primary judge found, having examined all the evidence about the steps being taken by the appellant and her husband and persons on their behalf, that by 25 May 1997 the appellant and her husband definitely regarded "West Garawan" as their property not the respondent's. 28 On the findings of the primary judge, some time in June, either 2 June or by 20 June, the respondent was aware that the appellant was keeping the properties for herself or on behalf of a partnership with her husband. Completion of the properties took place in July. 29 The primary judge first dealt with the principal/agency claim. On the findings made by the primary judge, her Honour concluded that by 9 May 1997 the appellant was acting inconsistently with the agency arrangement and all that flowed thereafter was either conduct undertaken after the termination of the agency relationship or conduct undertaken that was inconsistent with the agency obligation or relationship. 30 As to the contract claim, the primary judge concluded that the respondent had at no time repudiated his obligations under the contract. Her Honour also found that the appellant had, by her conduct made known to the respondent, repudiated the contract, which, effectively, in all the circumstances, had been accepted by the respondent from approximately 20 June 1997. The repudiation was the effective communication of a decision the appellant had made to keep the properties and pay for them herself. 31 As to the misrepresentation claim, the primary judge concluded that at all relevant times, the respondent had believed that he had the finance available to purchase the property. The primary judge concluded that the respondent had represented that he had finance available but concluded that at the time of making the statement he believed it to be true. 32 There were eight grounds of appeal. The first ground was that her Honour erred in finding that the respondent believed that he had access to $2 million dollars for the purchase of the two properties. The finding of the primary judge was supported by evidence. The respondent had procured letters of offer of finance totalling $1.7 million, acceptable by signing them and paying certain fees within seven days. Both the respondent and his accountant, Mr Leece, gave evidence that upon their understanding of the loan agreement, the loan moneys were available to facilitate the purchase. There is some evidence to the contrary by an officer of the lender called by the appellant, a Mr Bishop. This evidence was dealt with by the primary judge by her acceptance of the evidence of the respondent and Mr Leece that they thought the finance was available. It is unnecessary to traverse all the matters raised by the respondent in his submissions. It is sufficient to conclude that the finding was clearly open to the learned primary judge. The primary judge had the advantage of a number of days at the hearing absorbing all the evidence and considering the advantage of the trial judge in that regard: State Rail Authority (NSW) v Earthline Constructions Pty Ltd (1999) 73 ALJR 306; see generally Branir Pty Limited v Owston Nominees (No 2) Pty Limited (2001) 117 FCR 424 at 435-436[24], I am not able to conclude that there was any error in the conclusion of the primary judge in this regard. The submissions of the appellant do not assist in isolating any particular error in this respect which might lead to a conclusion that the primary judge fell into error. The submissions of the appellant were largely a recitation of the evidence given by and on her behalf, much of which was rejected by the primary judge. 33 The second and third grounds complain about the finding of facts made about the appellant's intention to complete the purchase of the properties as principal rather than as agent as at 9 May, or alternatively, as at 12 May 1997. 34 These findings were made after a careful assessment of the evidence and an evaluation of the credit of the appellant. Nothing in the appellant's submissions leads me to conclude that there has been any error of the primary judge in drawing these conclusions. 35 The fourth ground of appeal was that the primary judge erred in that she failed to give any or proper weight to the respondent's asserted inability to provide funds for the purchase and to his disinclination to take any step in furtherance of the provision of money until he had reached a final agreement with Westpac. 36 The appellant's submissions do no more than recount evidence all of which was dealt with by the primary judge. I am not able to identify any error in the conclusion of the primary judge that in effect the respondent did not in any way repudiate the relationship of a principal and agent or the contract of agency. The particular matters referred to in the notice of appeal were part of the appellant's case all of which was considered by the primary judge. No relevant error has been demonstrated. 37 The fifth asserted error was that the primary judge erred in failing to give any or proper weight to the evidence of Mr Lyons, solicitor for the appellant, in relation to the appellant's statements to him on or about 13 May that she had purchased the properties on behalf of the respondent. 38 The primary judge gave careful consideration to Mr Lyons' evidence and dealt with it: see paragraphs 68-76 and 120 of her Honour's reasons. There is no substance to the complaint that the primary judge gave no proper weight to the evidence of Mr Lyons. 39 The sixth ground of appeal was that the primary judge erred in finding that the appellant's desire to ensure that a boundary adjustment between West Garawan and the property "Garawan" constituted an intention which was inconsistent with the appellant's agreement to purchase West Garawan on behalf of the respondent. 40 This individual factual matter was part of the primary judge's consideration of all of the circumstances attending the appellant's state of mind. The submissions of the appellant give no basis to conclude or infer that there was any error by the primary judge in using the question of the boundary adjustment as a relevant consideration in her overall assessment of the evidence as to the intention and conduct of the appellant. No error is shown. 41 Grounds seven and eight assert that the primary judge erred in concluding that the appellant's conduct brought an end to the principal and agent relationship. On the findings made by the primary judge, supported by her findings based on credit, as well as the detailed consideration of the evidence, the appellant had decided to keep the property for herself or the partnership she had with her husband and that this was made known to the respondent by 20 June 1997. Though the acceptance of such repudiatory conduct was not clear or express, it is evident that though the respondent was not happy with the state of affairs, effectively, he treated the agency relationship as at an end, the appellant and her husband keeping the land for themselves, the respondent abandoning his claims upon the appellant. No error in the primary judge's conclusions in this regard was disclosed in the submissions of the appellant. 42 On looking at the findings and considering the complaints about them I see no basis for concluding that there is any error in the reasons of the primary judge as asserted in the notice of appeal or written submissions. 43 It is also to be noted that from August 1997 until June 2001 the appellant made no claim upon the respondent in relation to the purchase. It was only after receipt of a notice of default by the lender that the appellant to use the words of the primary judge "was prompted to issue her own demand upon the [respondent] for the first time". 44 In the light of the notice of appeal and the contents of the written submissions put before the Court, I am of the view that there is no basis revealed in any of the material for any conclusion that the primary judge committed any error in reaching the conclusions to which she came in her judgment. In these circumstances the appeal should be dismissed with costs. 45 HODGSON JA: I agree with Allsop P. 46 BRERETON J: The appellant Wendy Jill Murray sued the respondent her uncle Eric Keith Duddy on three causes of action: first, for indemnity in respect of expenses and liabilities incurred by her in the course of acting as his agent upon the purchase of the West Garawan and Square Bush properties; secondly, for damages for breach of contractual arrangements between them to the effect that she would purchase the properties on his behalf and he would provide all the purchase moneys; and thirdly, for damages for an allegedly fraudulent misrepresentation that he had finance approved for the purchase of the properties. Although, in her Further Submissions on the appeal, she also complained that an allegedly false valuation of West Garawan obtained by the respondent in June 1996 had "not been properly dealt with", no case in respect of that valuation was pleaded.

Murray v Duddy

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Judgment (19 paragraphs)

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Cases Cited (7)