Reichenbach v Robson

4. That the amount standing to the credit $250,00.00 by Mr John Reichenbach to W & J Partners shall be treated as a contribution by him to the capital of the Partnership and Mr. Wayne Robson shall contribute $3,222,000.00 via finance as his share towards the capital of the partnership and purchase the property known as 841 Jeparit-Warracknabeal Road Jeparit Victoria 2423.

6. Mr. Wayne Robson agrees and is committed to pay the agreed Interest at the rate of 8% per year for a period of 5 years on the equity advanced by Mr Reichenbach, 1st Interest payments of $20,000.00 is due and payable on or before the I4th of February 2015 and each year thereafter until the 14th of February 2019 which is to be paid as directed by Mr. John Reichenbach or/on any other convenient or auspicious day as may be mutually agreed upon between the parties hereto from time to time.

9. That the amount of $50,000.00 will be repaid of the loan amount of $250,000.00 over the next 5 years is due and payable on the H11* of February 2015 and each year thereafter until the l4th of February 2019 to Mr. John Reichenbach and his nominated account.

10. The respective interests of Mr Robson and Mr Reichenbach shall be determined on the assumption that each party had contributed $250,000 each to the purchase of the Property and own the property 250,000 parts (Mr Robson) to 250,000 parts (Mr Reichenbach).

11. To the extent that Mr Robson has repaid any of the principal amount due pursuant to clause 9 above, then the respective interests will be adjusted accordingly. By way of example if Mr Robson has paid the first yearly interest amount of $20,000 pursuant to clause 6 above AND a further $50,000 payment pursuant to clause 9 above then the parties own the Property in the respective interests of 250,000 (Mr Robson) to 200,000 (Mr Reichenbach).

25. At the end of the investment term of 5 years subject to the repayment terms being complied with the property at 841 Jeparit-Warracknabeal Road Jeparit Victoria 3423 must be valued and any increase in value other than the purchase price Mr. Reichenbach retains his right to claim an agreed amount of percentage as to his initial investment amount of $250,000.00 as to Mr. Robson's investment amount of $322,000.00. The parties of the partnership must agree to such amount and Mr. Robson is obligated to pay Mr. Reichenbach the difference between the purchase price and the updated valuation within an agreed period of time.

1. In his defence, Robson alleges that the arrangement between the parties was that the payment constituted a loan which sum has been completely repaid with interest. He denies that the agreement was a partnership agreement. Therefore, Robson says that Reichenbach is not entitled to any interest in the property.
2. Under clause 3 of the Partnership Deed, provision was made for the parties to conduct a "cropping and sheep farming business". This clause provides the focus of the current application. Reichenbach says that this arrangement was never enacted and therefore claims that part of the Partnership Deed to have been abandoned by the parties.
3. Robson appears by his pleading to accept that this is the case: see paragraphs 26 and 32 of the Defence. His Counsel, Mr Harrison, confirmed in argument before me that "there is no partnership as alleged by the plaintiff or at all". That is, that the parties never operated the cropping and sheep farming business as was contemplated by clause 3.
4. Nevertheless, by the impugned paragraphs of his defence, Robson also alleges that a cropping and sheep farming business conducted by Reichenbach alone on a different property constituted a "competing business" to that contemplated by the partnership. He therefore claims that Reichenbach is obliged to account to the partnership for the profits made in that business.
5. Reichenbach says that in light of Robson's acceptance that the cropping and sheep farming business contemplated by the partnership deed was abandoned, Robson's claim for an account in respect of the separate business conducted by Reichenbach must fail. This is because, so it is said, absent a partnership business as contemplated by clause 3 of the Partnership Deed, no fiduciary obligations of the nature relied upon by Robson would arise in respect of any other alleged competing business. This necessarily means that no obligation could fall upon Reichenbach to account for the separate business.
6. As a consequence, Reichenbach says that those paragraphs in which Robson's claim is articulated, have no real prospects of success and should therefore be dismissed.
7. The second aspect of the summons seeks orders that further and better particulars be provided by Robson of paragraph 45 of his defence. In the course of argument Mr Harrison accepted that his client could and would provide particulars of this paragraph. I will make an order that he do so, however it will not be a self-executing order as the plaintiff has sought.

1. The test to be applied in a summary judgment application was settled by the Court of Appeal in Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd[1] as follows:[2]

(a) The test for summary judgment under s 63 of the Civil Procedure Act 2010 is whether the respondent to the application for summary judgment has a "real" as opposed to "fanciful" chance of success;

(b) the test is to be applied by reference to its own language and without paraphrase or comparison with the "hopeless" or "bound to fail test" essayed in General Steel;

(c) it should be understood, however, that the test is to some degree a more liberal test than the "hopeless" or "bound to fail" test essayed in General Steel and, therefore, permits of the possibility that there might be cases, yet to be identified, in which it appears that, although the respondent's case is not hopeless or bound to fail, it does not have a real prospect of success;

(d) at the same time, it must be borne in mind that the power to terminate proceedings summarily should be exercised with caution and thus should not be exercised unless it is clear that there is no real question to be tried; and that is so regardless whether the application for summary judgment is made on the basis that the pleadings fail to disclose a reasonable cause of action (and the defect cannot be cured by amendment) or on the basis that the action is frivolous or vexatious or an abuse of process or where the application is supported by evidence.

1. The 'no real prospect of success' test was re-affirmed by the Court of Appeal in Mandie v Memart Nominees Pty Ltd.[3] Kyrou, Ferguson and McLeish JJA observed (omitting citations):

[42] The CP Act has changed the litigation landscape. One of the main purposes of that legislation is to reform practice and procedure in civil proceedings, including by reforming the law relating to summary judgment. More than ever, the focus is now pointedly on efficiency and cost-effectiveness, albeit that they are not the only, nor the predominant, considerations.

[45] According to Lysaght: a prospect which is not 'real' is 'fanciful'; although the 'no real prospect of success' test in s 63(1) of the CP Act is more liberal than the common law test of 'hopeless' or 'bound to fail', there may not be much difference between them in practice; and, properly understood, a real question to be tried is one which realistically might result in the respondent to an application for summary judgment succeeding in the proceeding.

1. The discretion of the Court to grant summary judgment under the Civil Procedure Act is subject to s 64 which provides that the Court may order that a civil proceeding proceed to trial if the court is satisfied that, despite there being no real prospect of success, the dispute is of such a nature that only a full hearing on the merits is appropriate.[4]
2. I also note that the High Court has emphasised that the power to order summary judgment must be exercised with caution:

"The exercise of powers to summarily terminate proceedings must always be attended with caution. That is so whether such disposition is sought on the basis that the pleadings fail to disclose a reasonable cause of action or on the basis that the action is frivolous or vexatious or an abuse of process The same applies where such a disposition is sought in a summary judgment application supported by evidence. As to the latter, this Court in Fancourt v Mercantile Credits Ltd said:

'The power to order summary or final judgment is one that should be exercised with great care and should never be exercised unless it is clear that there is no real question to be tried'[5]

1. Paragraphs 44, 68 - 71 and 72(b) and (c) (the Relevant Paragraphs) of Robson's defence, the subject of this summary judgment application, essentially plead a defence of set-off for any amount for which Reichenbach is found liable to account arising from his sheep farming and cropping business allegedly conducted in competition with that business of the alleged partnership. These paragraphs reference allegations at subparagraphs 26(m) - (p) of the Defence, that Reichenbach operated a business of the same nature as the partnership's sheep farming and cropping business and that he did so in competition with the partnership.

1. Reichenbach relied upon his own affidavit filed 30 July 2025. In that affidavit, he deposed to the following matters:

(a) Robson and Reichenbach never conducted themselves as if they were in a cropping and sheep farming partnership with each other;

(b) he has operated a cropping and hay-baling partnership (not involving sheep farming) with his wife on their own property (Glenlee Property);

(c) Robson has operated a cropping and sheep-farming partnership with his wife on the Property until he sold it in 2021 and since then at Meningie, South Australia;

(d) Robson and Reichenbach never carried on any sheep farming or cropping or activities in common;

(e) Robson and Reichenbach never shared with each other any information detailing their cropping or farming activities or shared profits or losses from their respective cropping or farming activities.

1. As a consequence of these matters he says that the claims made in the Relevant Paragraphs enjoy no reasonable prospects of success.
2. Robson filed no evidence on this application at all. The consequence of this is that Reichenbach's evidence as to the partnership not having conducted a sheep farming and cropping business stands uncontested.

1. Professor Finn, as his Honour Justice Finn was when he wrote his seminal work Fiduciary Obligations, (The Federation Press, republished 2016), in the chapter "Conflict of Duty and Interest", said this at paragraph 541:

The all-important matter is the undertaking actually given by the fiduciary. Until the scope and ambit of the duties assumed by the fiduciary have been ascertained - until the "subject matter over which the fiduciary obligations extend" has been defined - no question of conflict of duty and interest can arise. You must ascertain what the fiduciary has undertaken to do, before you can say he has permitted his interests to conflict with his undertaking. The whole purport of this rule can be expressed neatly in the ... formula: He who undertakes to act for another in a particular matter undertakes at the same time not to act for himself in the same matter. (footnotes omitted)

1. Professor Finn also said the following of fiduciary obligations at paragraph 545:

Where parties enter into partnership, or agree to work together for a designated purpose only, each assuming duties to the other to effect that purpose, then the courts will hold the parties rigidly to their undertaking. So it is long settled that a partner cannot, by any dealing on his own account, derive a profit from a transaction falling within the scope of the partnership business. His co-partners have the right to say that such a dealing was " ... part of the business for which the partnership was established, and ... to say that what you have been doing nominally for yourself ... was for the benefit of that partnership''. It is likewise with profit making opportunities falling within the designated objective of a joint venture.

In either case the all-important matter is defining the scope and ambit of the business relationship created between the parties. With partnerships the scope of the partnership business is determined"... by the character of the venture or undertaking for which the partnership exists, and this is to be ascertained, not merely from the express agreement of the parties, but also from the course of dealing actually pursued by the firm''.

1. It must be appreciated that Reichenbach differentiates between the sheep farming and cropping business contemplated to have been conducted by the partnership under clause 3 of the Deed and the partnership business of holding the land contemplated to be purchased under the Deed, as different businesses. He says that even though the sheep farming and cropping business did not take place, the partnership nevertheless operated in respect of the landholding.
2. Reichenbach submits that his uncontested evidence demonstrates that there was never any sheep farming or cropping business carried out by Reichenbach and Robson in common. He says that it follows that the Relevant Paragraphs of Robson's defence have no real prospects of success based on a number of points:

(a) Reichenbach's cropping and hay-baling business conducted in partnership with his wife on the Glenlee Property was conducted openly and, on numerous occasions, in the presence of Robson who never protested or complained of Reichenbach's right to do so.

(b) Robson should not be permitted to set up two inconsistent sets of facts in the alternative when one or the other must be known by the party pleading to be false. Robson's defence denies that he was carrying on a sheep farming and cropping business in common with Reichenbach, but at the same time sets up an alternative plea that he was doing so, and that Reichenbach breached the fiduciary duties owed by one partner to another by carrying on a competing business for the profits of which he must account. Reichenbach relies on Brailsford v Tobie[6] and Issitch v Worrell[7] in support of this proposition.

(c) Robson has admitted the abandonment of any partnership between the parties insofar as it relates to sheep farming or cropping: see paragraphs 26 and 32 of the Defence. Furthermore, Robson pleads a whole series of factual matters that he says gives rise to the conclusion that there was no such partnership business. He will no doubt give evidence of those matters at trial. It is difficult to understand how he can then set up a contrary case based on the proposition that there was such a partnership business conducted. This, when he knows it not to be true.

(d) Reichenbach submits that it is clear that the abandonment must have taken effect immediately following the execution of the written agreement based on the matters pleaded at paragraph 26 of Robson's defence. This is reinforced by the plea at paragraph 32 of the Defence that by reason of those matters, if there ever was a partnership, it was abandoned by the parties.

(e) Mr Harrison baulked at the proposition that there was in his client's pleading any temporal fixation of the abandonment. He seemed to be reserving to his client the ability to argue that the partnership in this respect may have subsisted for some time and then came to an end. I do not accept that this is a reasonable reading of paragraphs 26 and 32 of the Defence. The matters referred to in paragraph 26 are stated in unqualified form. The only reasonable reading of them is that the relevant business never commenced. This was reinforced by his submission to me that "there is no partnership as alleged by the plaintiff or at all".

(f) Reichenbach filed a Notice of Admission by which he partially admitted paragraph 32 of Robson's Defence to the extent it alleges that the sheep farming and cropping business contemplated by the Partnership Deed was abandoned.

(g) Based on that admission, Reichenbach submits that an admission of fact alleged in the pleading of the opposing party removes the fact from the arena of controversy and no evidence relating to it will be admitted at trial. He says that as the primary defence of abandonment is admitted, there can no longer be any room for an alternative case.

1. By contrast Mr Harrison submitted that the Partnership Deed upon which the plaintiff relies only contemplates one field activity for the partnership to be engaged in. That is the sheep farming and cropping activity referred to in clause 3 of the Deed. While he accepted that that business was never caried out and, as he pleads was abandoned, he nevertheless maintained that some fiduciary obligation arose which prevented Reichenbach from operating a "competing business" of that description. I reject both of those propositions.
2. The clauses of the partnership deed set out at paragraph ‎5 above make clear that one of the activities of the partnership was to hold the land together and regulated how their respective partnership shares were to be calculated and dealt with. As articulated by Professor Finn, that the partnership held the land does not impose any fiduciary obligation on Reichenbach as one partner not to conduct his own separate cropping business on his own nearby farm. Similarly, that separate business cannot be classified as a "competing business" to that of the partnership when it is common ground that the partnership abandoned any such business.
3. It is also common ground that Robson occupied the land concerned and carried out on his own behalf a sheep farming and cropping business. This inferentially supports the proposition that there was no fiduciary obligation on Reichenbach not to do the same on his own property.
4. Mr Harrison sought to draw support from the reference to paragraphs 7 and 14 of the Partnership Deed in paragraph 26 of the plaintiff's Reply. These do not assist him. Upon a proper reading of those clauses, the obligations referred to are referable to the landholding partnership relied upon by Reichenbach and not the sheep farming and cropping business that the parties agree had been abandoned. In any event, I would read the reference to those clauses in the Reply to be confined by the Notice of Admission filed by Reichenbach that the sheep farming and cropping business was abandoned.
5. Having regard to those matters there are no grounds for Robson to claim a breach of a fiduciary duty owed to him by Reichenbach in respect of that business.
6. I consider this aspect of the defence to enjoy no reasonable prospects of success and the claims set out in the relevant paragraphs will be dismissed.

1. For the reasons I have stated above, the Court will order that there be summary judgment in favour of Reichenbach in respect of the defences articulated in paragraphs 44, 68 - 71, and 72(b) and (c) of Robson's defence.
2. I will hear the parties on costs.

I certify that these 12 pages are a true copy of the judgment of His Honour Judge Wise delivered on 12 September 2025

[1] [2013] VSCA 158.

[3] [2016] VSCA 4 at [40].

[4] Civil Procedure Act 2010, s 64(b).

[5] Spencer v Commonwealth [2010] HCA 28; (2010) 241 CLR 118 at 132 at [24].

[6] (1889) 10 ALT 194.

[7] (2000) 173 ALR 586.