Schweitzer v Kronen Verwaltungs GmbH [1998] VSC 190

Schweitzer v Kronen Verwaltungs GmbH [1998] VSC 190 - VSC 1998 case summary — Zoe

[36]

The plaintiff has deposed in her affidavit that moneys due to her and Ebner under the agreement from or about 26 October 1991 were paid on occasions into a bank account in Germany and on other occasions into a bank account in Melbourne. The plaintiff has deposed that despite the arrangement whereby moneys were paid into an account in Melbourne and of other occasions into an account in Germany, the principal obligation of the defendants in respect of the moneys payable in Australian dollars was to make these payments to the account held by herself and her husband at the bank at Melbourne which she opened in October 1990 when the interest under the agreement was transferred from Logenstone Corporation Pty Ltd. Other than asserting this fact the plaintiff provides no evidence from which it can be concluded or inferred that the principal obligation contended for by her was in fact the case. It is to be noted that in correspondence signed by Ebner in October 1988 and addressed to Igedo, the letterhead contains the name Logenstone Corporation Pty Ltd as well as the name Logenstone Corporation and was signed by Ebner under the typed name Logenstone Corporation. It is further to be noted that in a faxed letter dated 26 May 1993 addressed to Igedo and signed by Ebner above the typed name Logenstone Corporation there appears to be the image of two business cards stating that Ebner is the managing director and that the plaintiff is a director of Logenstone Corporation. Further, notwithstanding the assertion of Ebner and the plaintiff as to the transfer of the interest in the agreement from Logenstone Corporation Pty Ltd to a business Logenstone Corporation, invoices addressed to Igedo in May, July and August 1991 were stated to be from Logenstone Corporation Pty Ltd. Further, an invoice directed to Igedo on 6 May 1993 for services alleged to have been rendered during the period 7 February 1993 to 6 May 1993 and again an invoice on 6 August 1993 addressed to Igedo for services alleged to be rendered from 1 July 1993 to 6 August 1993 were each stated to be from Logenstone Corporation Pty Ltd.

[46]

The next claim made by the plaintiff is for $65,589.60 for the "cost charges and expenses in relation to the proposed Igedo press conference in Australia". This is particularised in paragraph 18C of the further amended statement of claim. In Ebner's affidavit the claim identified under this head is quantified in a total sum of $29,986. In Ebner's affidavit, he has deposed that the time spent on this work was a total of 216 hours. However, as particularised in the further amended statement of claim, it is alleged that the times occupied in this work is more than double that time, being 442 hours. The claim of the plaintiff has in its origins a letter from Ebner to Igedo dated 10 July 1992 and a response to that letter from Igedo dated 23 July 1992. In that latter letter Igedo referred to the suggestion of Ebner that it conduct a press conference in Australia and stated that Igedo would be grateful if Ebner would inform it of cities in his opinion which should be taken into account and to forward quotations for functions so that they could make a final decision. On 9 September 1992 Ebner communicated with Igedo providing to it basic cost figures provided by the Hilton Hotel, Sydney and Melbourne. No press conference was forthcoming as Igedo decided not to proceed. In his letter to Igedo dated 9 September 1992, Ebner stated, "Please let us know if we can be of any further assistance in this matter". There appears to be no further response to that. In the affidavit of Wright as confirmed by Kronen, it is deposed that Igedo paid to Logenstone Corporation Pty Ltd DM5,000 per month agency fee as well as reimbursing it for expenses pursuant to the agreement and that neither Logenstone Corporation Pty Ltd or its servants or agents informed Igedo that such enquiries for the arrangement of a press conference were to be for remuneration in excess of entitlements under the agency agreement. The particularisation of this claim in paragraph 22 of the affidavit of Ebner, on its face, makes the claim grossly inflated and disproportionate to any evidence supporting work performed in respect of this matter. It is to be noted that notwithstanding the closing statement in the letter of Ebner dated 9 September 1992 in his affidavit he identifies and particularises the work being performed until February 1993.

[47]

The next claim made by the plaintiff and in paragraph 18D of the further amended statement of claim is for $475,170.35 for "cost charges and expenses in relation to establishing markets for end of season garments in Australia". In his affidavit sworn on 17 June 1994 the claim as identified and deposed to amounted to $245,229. Other than the statement of the plaintiff previously referred to, there is no explanation forthcoming from the plaintiff as to this vast difference for the basis of the same. Under the further amended statement of claim the claim is for 3,372 hours of work performed. However, Ebner has deposed that the time spent on this work was 1,700 hours. This claim along with the others is also contested by Igedo. In his affidavit, Wright has deposed that in or about March 1990 there were discussions held in Dusseldorf between the plaintiff and Ebner on behalf of Logenstone Corporation Pty Ltd and Kronen regarding the possibility of marketing and selling end of northern hemisphere season garments in Australia, and that it was agreed that the possibility would be investigated without committing Igedo financially. These facts have been confirmed by Kronen in his affidavit. He has further deposed that this matter was solely for the benefit of Logenstone Corporation Pty Ltd and that it wanted to develop that line of business and Igedo assisted Logenstone Corporation Pty Ltd and introduced it to a manufacturer. It is deposed by Ebner that in March 1993 Kronen was advised that a substantial amount of time and considerable expenses had been expended in performing this task for them and that Kronen said that he was disappointed that all the effort had been allowed to go to waste and accepted substantial responsibility for failing to co-ordinate the project and oversee the relationship more directly and that at that time it was made clear to Schweitzer that they should cease their further involvement. Kronen, in his affidavit, denies that such conversation took place. The claim under this head as identified and particularised by Ebner in his affidavit is a claim for services performed during the period March 1990 to February 1993 and involves a claim for 1,720 hours work at $125 per hour. By reference to the correspondence placed before the court the subject of this claim and its contents, the amount of hours claimed to have been occupied by the plaintiff and Ebner on this activity seem to be out of all proportion. It is further deposed by Wright in his affidavit and confirmed by Kronen in his affidavit that neither the plaintiff or Ebner in their capacity as officers and directors of Logenstone Corporation Pty Ltd or on their own behalf at any stage sought from or discussed with Kronen or Igedo payment or any remuneration in respect of this claim but rather the first time that a claim was made for remuneration and refund of expenses under this head was following service of the writ and the statement of the claim upon them.

[48]

The next head of claim made by the plaintiff is that under paragraph 18E of the further amended statement of claim, "cost charges and expenses in relation to establishing the Igedo Travel Service in Australia". Under this head the plaintiff claims $81,524.85. In the affidavit of Ebner the claim made under this head was for $36,180. Again no explanation was forthcoming on these proceedings as to the vastly increased amount of the claim and how it differed from that previously identified other than the plaintiff's general assertion. The time frame in respect of which this claim for services and expenses as deposed to by Ebner is between 30 April 1992 and September 1992. As appears from the affidavit of Wright, as confirmed in the relevant respect by Kronen in his affidavit, by a newsletter dated 24 April 1992 despatched by Igedo to all its overseas agents, including Logenstone Corporation Pty Ltd, it informed them of its intention to set up "Igedo Travel Service" with the agency "Hartmann incoming and incentive service". The circular provided an interim list of travel agents co-operating with Hartmann, pending finalisation of a binding agreement with Hartmann for the "Igedo Travel Service". The newsletter sought from each overseas agent a recommendation for a travel agent on the list co-operating with Hartmann or any other travel agent to organise overseas travel to the 1993 fashion fairs within each overseas agent's area on or before 12 May 1992. On 30 April 1992 Ebner, in a faxed letter to Igedo, acknowledged receipt of the circular and stated, "With your approval we will approach a number of good and credible Australian travel agencies and ask them to give us their written submissions for providing our Igedo visitors with suitable travel packages." On 4 May 1992 Igedo communicated by fax with the plaintiff and Ebner advising that the travel service contract had to be signed the following day and advising what the package offered in 1993 would include. On 28 May 1992 the plaintiff, on letter head "Logenstone Corporation Pty Ltd" advised Igedo that they had sent out briefs to a selection of travel agents (14 in all) with an invitation to submit their proposals to become involved with the new Igedo Travel Service. As deposed by Wright, thereafter Logenstone Corporation Pty Ltd did not forward any other memorandum to Igedo concerning the "Igedo Travel Service". Again, it is deposed that the defendants became aware for the first time of this claim following service of the writ and statement of claim. In his affidavit, Ebner has deposed that the representatives of Igedo with whom the plaintiffs were associated and from whom they obtained instructions to carry out the work the subject of this claim were a Mrs Bergmann and a Mrs Kaczorowski. In his affidavit, Kronen has deposed that he has been informed by each of those two persons and believes that they did not give approval sought by Logenstone Corporation Pty Ltd in its fax dated 30 April 1992, that other than the information sought in a fax from Logenstone Corporation Pty Ltd by Igedo in its fax dated 4 May 1992 they did not make any further request in connection with the travel service and that prior to 12 May 1992, being the date by which overseas agents were to provide a list of travel agencies, no response had been received from Logenstone Corporation Pty Ltd. He deposes further that he has been informed by such persons and believes that they did not authorise the forwarding of the brief referred to in the letter dated 28 May 1992 from Logenstone Corporation Pty Ltd to Igedo and further, they did not receive any other information in connection with forwarding of briefs to travel operators as asserted. It is again clear that Igedo substantially and on a factual basis joined issue with the plaintiff's claim under this head and denies her entitlement to any sum claimed with respect to it.

[50]

The final claim made by the plaintiff is that identified in particular A of paragraph 18 of the further amended statement of claim is a claim for $37,538.08 for "unpaid invoices". Ebner, in his affidavit, exhibits the invoices referred to in this paragraph. It is to be noted that the first invoice dated 6 August 1993 is from Logenstone Corporation Pty Ltd and bears the common seal of that company. The services rendered and amounts claimed in that invoice are for the period from 1 July 1993 to 6 August 1993. In his affidavit, Kronen has deposed that in relation to the claim for $14,720 being the subject of the invoice dated 6 August 1993, despite several requests for evidence of expenditure there identified, such details have not been supplied by the plaintiff. In the affidavit of Kronen he has deposed that amount referred to in Exhibit SMW10 were paid by Igedo without having received evidence that the debts had been properly incurred or without Igedo's prior agreement to pay the expenses. One such amount was that for the expenses allegedly incurred during period 1 July 1993 to 6 August 1993 and being the amount previously referred to of $14,720. By his affidavit, Wright has deposed, which Kronen has confirmed, that the expenses allegedly incurred by the plaintiff during the period from 7 August 1993 to 6 November 1993 were incurred without the defendants' consent or approval and following termination of the agreement. It is to be observed that the letter enclosing the invoice dated 6 August 1993 for $14,720 requested payment of that invoice into a German bank account. This contradicts the contention that moneys for work performed were to be paid in Victoria, and that by Igedo failing to so pay there is breach of the implied agreement giving rise to a claim on a quantum meruit, which is able to support service out of Australia under Rule 7.01(g). The assertion by the plaintiff that the principal obligation of the defendants was to pay moneys due into a bank account in Melbourne, is not evidence of that fact as contended for.

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Judgment (64 paragraphs)

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