Cash Resources Australia Pty Ltd v Factors (NSW) Pty Ltd & Anor [1991] QSC 257

10 IN THE SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION ~ 0 / cf { 'o/ I No. 1079 of 1990 BEFORE MR JUSTICE MACKENZIE BRISBANE, 19 AUGUST 1991 BEIWEEN: (Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Chief Court Reporter,Court Reporting Bureau.) CASH RESOURCES AUSTRALIA PTY. LTD. Plaintiff 10 20 20 30 -and- FACTORS (NSW) PTY. LTD. trading under the name style or firm of KEY FACTORS First Defendan -and- JOHN HARROP Dctfenda.n JUDGMENT HIS HONOUR: The plaintiff company appears to seek damages in respect of transactions which it entered into with the first defendant of which the second defendant is alleged to be the 30 40 agent. There is no appearance by either defendant. It is said 40 in the material that the company, the first defendant, would 50 60 not be represented at the matter today due to lack of funds. Solicitors who were previously employed by the second defendant have filed notice that they no longer act on behalf of the second defendant and that he was acting on his own behalf. The essence of the claim is a claim under the Trade Practices Act for misleading and deceptive conduct, and there i also a claim for fraudulent misrepresentation. The essence of the claim is that certain alleged debts factored by the first -Govt. Printer, Qld. 1 50 60 -- 1 of 3 -- 10 20 30 defendant which the plaintiff was induced to purchase following representations by the second defendant on behalf of the first defendant were not good and valid debts. With the exception of debts related to Christie's, it appears from the material that, by and large,they were simply not debts that were due and owing because companies which, on the face of the documents, were the recipients of goods said that they had not received such goods and denied liability on that basis. Christie's debts were debts owed by a firm which was associated with the mother of th person who was concerned with the organisation whose debts were factored. In respect of Christie's debts, the proposition is that as Mr Harrop was employed during the period around which the payment was made of moneys which were paid by the plaintiff to the first defendant as a consultant to the organisation whose debts were factored, then he must have been in a position to know of the financial position of Christie's which, at least by the end of 1989, had become unable to pay its debts. Mr Perry makes the point that the whole of the moneys were paid on the basis of the representations as to the recoverability of the debts as a whole. There is no evidence to the contrary 40 50 60 relating to the non-recoverability of the debts, and I will proceed on that basis. The amounts which are claimed are the amounts of the debts which are $129,211.73, and the second component, the costs associated with attempts to recover the moneys. That involved the plaintiff employing an investigative debt collecting organisation, accountants and a firm of solicitors. The moneys that were paid to the accountants included components which were related to their appointment as the plaintiff's agent unde security documents, and there is a component in that relating -Govt. Printer, Qld. C 2 10 30 50 60 -- 2 of 3 -- 10 to the conduct and/or the winding down of the business activities of the organisation. The total amount which in the absence of any evidence to the contrary I will accept is $114,946.30. The total claim is $244,158.03, and I will hold that that sum is -recoverable by the plaintiff. So far as the question of interest is concerned, Mr Perry submitted that I ought to adopt the alternative of splitting the components because of the different times at which they had arisen. He submitted that it was appropriate to make that split rather than simply to award interest from the date of 10 20 20 30 issue of the writ. There is some $20,000 difference in favour of his client if I adopted the former approach rather than the latter. I think in the circumstances of the case it is appropriate to make the calculation of interest on the basis that the amount on the debt should be computed separate from that of the component related to the recovery costs. Mr Perry has calculated certain sums of interest on the basis that an interest rate of 15 per cent should be allowed as from the date 14 August 1989 and 15 May 1990 respectively until today's date. He submitted that an interest rate of 15 per cent covering that 40 40 50 60 period would be appropriate. He submitted that being a commercial transaction, ,that rate of interest was appropriate. I think, having regard to the trend which interest rates have followed in the period over which the amounts have been calculated, 15 per cent, having regard to the way interest rate are applied in this Court, may be a little high, and I would be inclined to allow interest at 13~ per cent rather than 15 per cent. I allow interest in the sum of $55,150.4Q. I award the plaintiff costs, to be taxed. -Govt. Printer, Qld. 3 50 60 -- 3 of 3 --