Brien v Greenland [1999] QSC 391

State Reporting Bureau TRANSCRIPT OF PROCEEDINGS Copyright in this transcript is vested in the Crown, Copies thereof must not be made or sold without the written authority of the Director, State Reporting Bureau, REV!SED COPIES ISSUED i State Reporting Bureau Data:){; III / SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION /'1 DERRINGTON J No 7210 of 1996 GRAEME HARROLD BRIEN and PAULA THERESE GREENLAND ~_/ and ( \, PETER ANTHONY GREENLAND BRISBANE ,.DATE 14/09/99 JUDGMENT 1 ·1111 FIll",', Tile L:IW Courts, Gl'Orge Sln'cr, Brish:llIl', (). 41ltH) Plaintiff First Defendant Second Defendant Tdl!plllllll': (117) J.!47 4.1(11) Fax: (117) .1.!47 55.12 -- 1 of 7 -- 140999 kmk (Derrington J) HIS HONOUR: This is an application by the plaintiff against the first defendant as purchaser from him and mortgagor in respect of a part of the balance of purchase moneys relating to land sold by the plaintiff to the first defendant as to which the first defendant gave a mortgage back to the plaintiff. The plaintiff's action against the second defendant is as guarantor of the first defendant's indebtedness. The history is slightly complex but may be briefly explained. The plaintiff owned a largish block of land in Swann Road, st Lucia, which was in the course of subdivision but which had not yet been fully and formally subdivided at the relevant time. The plans were with the City ~ouncil which had placed some conditions upon subdivision and matters of that nature were being attended to by the surveyor. It is also suggested that there were some other conditions relating to arrangements with a neighbour about the provision of stormwater runoff through the neighbour'.s property. The defendants claim that the plaintiff's agent misrepresented the position in advertisements and otherwise by claiming that the land had been subdivided without indicating any qualifications of that statement. The contract was indeed entered into in such a way that the area of land was described by a description indicating two separate subdivisions. When it was discovered that the subdivisional procedures had not yet been finalised a 10 c: 30 ! 0 1 40 50 JUDGMENT 60 2 ---_... -----.----------.... _. -- 2 of 7 -- --I ) 140999 kmk (Derrington J) dispute arose between the parties who had separate solicitors. A compromise was reached whereby the sale was able to continue. The arrangement involved the first defendants giving the plaintiff a mortgage back for the balance of the 10 purchase money. That balance was defined by reference to the contingency whether the subdivision should be concluded at a time 12 months after the granting of the mortgage. If the subdivision were not concluded at that time other than by the default of the mortgagor, then the amount owing under 20 the mortgage was to be red~ced by $100,000. Quite plainly this was designed to compensate the mortgagor if, after a proper pursuit of the registration of the subdivision on her part, she were unsuccessful. 30 As it turns out, the subdivisional plan was not registered at the end of the 12 month period and there is a dispute as to whether or not that was due to the default of the mortgagor herself. At the date for payment of the money the 40 first defendant's agent, the second defendant, attended and offered to pay the total purchase price upon production by the plaintiff's solicitors of a registered subdivisional plan. When of course that could not be provided, the first defendant's agent then tendered the lower amount of money in 50 full discharge of the first defendant's obligation under the mortgage. The plaintiff's solicitors refused the first tender upon the JUDGMENT 60 3 -- 3 of 7 -- 140999 kmk (Derrington J) basis that the condition which was required could not be fulfilled because of the default of the first defendant. They also refused the second tender upon the basis that the plaintiff wished to retain his rights in respect of the additional $100,000, claiming he would be entitled on the basis that the absence of subdivision was due to the default 10 of the first defendant. The land was subsequently sold by the National Bank which held the first mortgage over the land from the first defendant and a sum of about $30,000 was paid to the plaintiff as the balance of the proceeds of the mortgagee sale and the payment out of the first mortgagee's debt and costs. The plaintiff then brought this action fo~ the full balance of the purchase money owing under the mortgage. This action was brought about three years ago and a statement of claim delivered but the parties entered into discussions in an attempt to compromise the arrangement ... Briefly, the nature of the discussions related to the first defendant's attempting to sell the land and payout the mortgages as the result. For that reason the plaintiff's conduct was reasonably deferred in an attempt to reach suitable settlement to all parties, a course of action which the Courts would always support and would not punish by refusing a plaintiff who was willing to try to negotiate a useful settlement that would avoid unnecessary costs by refusing summary judgment because of that delay. 30 OiI 40 ( -I \. ~I 50 JUDGMENT 60 4 -- 4 of 7 -- 140999 kmk (Derrington J) When the matter was finally taken out of the hands of both parties by the bank's sale of the land the matter had recommenced. The plaintiff has made an application for summary judgment. The first defendant has changed solicitors and produced a draft defence alleging further misrepresentation by the real estate agent at about the time 10 but shortly prior to the compromise of the dispute that was resolved by the granting of the mortgage. There is also a suggestion of some misrepresentation arising out of a statement made by the plaintiff's solicitor at the time concerning the state of the procedure for obtaining the Council's consent to the subdivision. There is no reason to remark upon the authenticity of that defence, though it should be noted that at that time the defendants were represented by their own solicitors who must have had access to the correct position relating to the plan at the time when they negotiated the compromise arrangement which may have saved their client $100,000. Be that as it may, the present application is for summary judgment and the plaintiff has limited that application today to the minimum amount which he says must be owing to him, that is the balance of purchase price less the $100,000 which was the amount of the reduction agreed to if the plan were not consented to at the end of the stated period and less a further amount for the sum received from the bank after the mortgagee sale. It is plain that that amount is owing because the defendant was at least prepared to offer 20 30 40 50 JUDGMENT 60 5 -- 5 of 7 -- 140999 kmk (Derrington J) it by way of tender at the time when the balance of moneys became payable, though the terms upon which that was offered would have required the plaintiff to abandon the balance of the claim. There seems to be nb good reason why the plaintiff should be 10 held out of his money that is plainly due whilst the parties then contest their respective claims~ the plaintiff for the balance of the purchase money which he says is due because the first defendant failed to take all proper steps to have the approval of the subdivision obtained, and the defendant may pursue her claim in respect of the alleged misrepresentation. A valuation has been produced suggesting that the amount of the loss that would have flowed frum misrepresentation was of the order of $300,000, but learned counsel for the first defendant rightly concedes that it is not formulated on a proper basis. The result is that there will be judgment for the plaintiff against the first defendant in the sum of $83,981.39. The questioo of costs of the application should be reserved and the balance of the claim should be made the subject of leave to defend. The action against the second defendant follows the same course. Learned counsel for the plaintiff sought judgment for the full amount claimed as the second defendant has not 30 o 40 o 50 JUDGMENT 60 6 -- 6 of 7 -- 140999 kmk (Derrington J) appeared here to contest the matter, but on the material available in the contest of the claim by the first defendant there is sufficient to indicate that at this stage, as there is still a contest as to what is owing under the primary debt, there should not be judgment in respect of the guarantee save to the extent of the amount of the judgment given against the first defendant. Consequently, there will be judgment for the plaintiff against the second defendant in the same amount and the costs of that, too, will be reserved. The remainder of the action against the second defendant will be deferred until the determination of the action against the first defendant. 10 20 30 40 50 JUDGMENT 60 7 -- 7 of 7 --