Scott MacRae Investments Pty Limited & Anor v Baylily Pty Limited & Ors

By paragraph 11 of the amended response, PLP admits paragraph 20(a) and purports to deny paragraph 20(b). paragraph 11 responds to paragraph C20 of the amended summons (which makes allegations against PLP only and against no other party).

The purported denial is of no effect: in the (original) response paragraph 20(b) was admitted (see Commercial List response filed 28 August 2009, par 9(a)) and no leave has been granted (or sought) to withdraw the admission. In any event, it has been proved (Mr Mitchell's second affidavit, par 14(b)) (and whether PLP carried on the business as principal or contractor is not central (or essential) for the purpose of establishing the second claim). Again, the non-admissions of the other defendants are of no significance.

By paragraph 12 of the amended response, Baylily admits that at all times since about 28 March 2003 it has held its unit in the Pacific Lennox Unit Trust as trustee for the Scott MacRae Trust (and that the unit is trust property of the Scott MacRae Trust). This allegation (in paragraph C21) is made only against Baylily (and against no other party) and again the non-admissions of the other defendants are of no significance.

Paragraph 13 of the amended response responds to paragraph C22 (which repeats paragraphs C1 to C15). By paragraph 13, the defendants simply repeat their responses to paragraphs C1 to C15 above and, accordingly, nothing additional is raised.

By paragraph 14 of the amended response, each of Baylily and PLP admit the allegations in paragraph C21 'subject to the matters pleaded in paragraphs 4 and 5 above' (proof of the Deed of Change of Trustee and the SMI Board resolution). For the reasons submitted above, these have been proved. Again, the non-admissions of the other defendants are of no significance.

By paragraph 15(a) of the amended response, Baylily purports to answer paragraph C24. Paragraph 15(a) is not responsive to the allegation in paragraph C24, which is simply that, despite demand, Baylily has refused to transfer the unit in the Pacific Lennox Unit Trust to SMI.

However, Baylily admits that SMI is entitled to become the registered holder of the unit (subject, again, to proof of the Deed of Change of Trustee and the SMI Board resolution, which, for the reasons submitted above, have been proved). In any event, demand and failure to transfer the unit have been proved: Mr Mitchell's second affidavit, par 1(f); annexures 'A' (p 1), 'B' (pp 7, 8), 'C' (p 9).

Paragraph 15(a)(ii) is not responsive to any allegation made in paragraph C24 and, again, the allegation in paragraph C24 is made against Baylily only (and against no other party). Accordingly, the non-admissions of the other defendants are again of no significance.

There is also the evidence required by Rule 13.1(b) : Mr Mitchell's second affidavit, par 15. Decision 23 It is critical to appreciate that the power given to the court to grant judgment upon admissions is discretionary. However the Court is not bound to act upon them: see Termijtelen v Van Arkel [1974] 1 NSWLR 525, at 528F (per Hope JA), regard must be had "to all the circumstances of the case" (citing In re Wright), at 529A. Moreover, it will not permit the applicant to supplement those 'admissions' with evidence (Termijtelen at 528F, citing Wagstaff v Fitzpatrick (1922) 39 WN (NSW) 137). 24 The defendants have pressed upon the Court a finding that the admission referred to is not one which the Court is bound to accept as true. Their contention is that in fact it has not been proven and the knowledge of the relevant facts is not within that of Baylily or any other of the defendants. Their contention is that, at most, the admission was contingent upon an event which the plaintiffs have not seen fit to satisfy: the bringing forward of evidence to demonstrate the making of the appointment and the acceptance by SMI of the trusteeship. 25 The defendants' contention is further that the circumstances of the case, (especially the document in which the admissions are said to be found), indicate ambiguity and are in relation to matters (the making of declarations) upon which the Court must itself receive evidence. The proposition is that the plaintiffs claim to be in a position to prove their entitlements and do not resile (by the very structure of the Amended Motion, which includes resort to UCPR 13.1) from so doing. They contend that the plaintiffs should not be entitled to co-mingle their applications. 26 They further contend that on any view, the alleged admissions are insufficient to support the totality of the relief claimed in the Amended Notice of Motion. Decision 27 There is no doubt but that the decision on the plaintiffs' essential claims to relief is a difficult one in the current circumstances. There is a long line of authority in support of the proposition that declaratory relief is ordinarily granted as final relief in a proceeding. : In Warramunda Village Inc v Pryde [2001] FCA 61, (2001) 105 FCR 437, the Full Court of the Federal Court of Australia noted (at [8]):

The remedy of a declaration of right is ordinarily granted as final relief in a proceeding. It is intended to state the rights of the parties with respect to a particular matter with precision, and in a binding way. The remedy of a declaration is not an appropriate way of recording in a summary form, conclusions reached by the Court in reasons for judgment. This is even more strongly the case when the conclusion is not one from which any right or liability necessarily flows. The conditional concession 28 In relation to the conditional acceptance by the defendants that they will not contest that SMI is the trustee and will agree to orders (d), (e), and (f) sought in paragraph 1 of the plaintiffs' amended notice of motion, those orders will be made if the conditions are satisfied by the plaintiffs. 29 The principled exercise of the material discretion is for the court to formulate a separate question as a useful mechanism for finally disposing of all relevant issues arising as between the plaintiffs and the relevant defendants concerning the operation of the trust. This is an appropriate case in which the court should deal with the issues which arise in relation to paragraphs C1 to C24 separately from and before all other issues in the proceedings. 30 Whilst it is strictly unnecessary to go further and to deal with the application for summary judgment, is at least appropriate observe that the orders sought by the plaintiffs are properly characterised as final ones: see, for example 1(g) and (h) (considered in Meehan v Glazier Holdings Pty Limited (2002) 54 NSWLR 146, at [34] (per Giles JA; with whom Sheller JA and Beazley JA agreed). They correspond with the relief contained in the Amended Summons. Therefore, section 75 of the Evidence Act 1995 (NSW) has no application. The summary judgment application is also dismissed.

The way forward 31 The parties are required to bring in short minutes of order. The orders will require that the defendants pay the plaintiffs' costs of the motion on an indemnity basis. The making of costs orders is a discretionary one. The current circumstances at the least indicate the type of delinquency emanating from the defendants conduct as to warrant this order 32 I accept that the plaintiffs are entitled to the relief sought in prayers 1 (d), (e) and (f) of the amended summons.

Corrigendum In paragraph 32 replace the words "prayers 1 (a) - (e)" with the words "prayers (d), (e) and (f)" ***************

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.