Alkan v Martin College Pty Ltd [2004] FCA 828

FEDERAL COURT OF AUSTRALIA

Alkan v Martin College Pty Ltd [2004] FCA 828 HAKAN ALKAN v MARTIN COLLEGE PTY LTD Q 53 OF 2004 DOWSETT J 1 JUNE 2004 BRISBANE

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY Q 53 OF 2004

BETWEEN: HAKAN ALKAN

APPLICANT

AND: MARTIN COLLEGE PTY LTD

RESPONDENT

JUDGE: DOWSETT J

DATE OF ORDER: 1 JUNE 2004

WHERE MADE: BRISBANE

THE COURT ORDERS THAT: 1. The application be dismissed. 2. The applicant pay the respondent's costs of the proceedings, including reserved costs. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY Q 53 OF 2004

BETWEEN: HAKAN ALKAN

APPLICANT

AND: MARTIN COLLEGE PTY LTD

RESPONDENT

JUDGE: DOWSETT J

DATE: 1 JUNE 2004

PLACE: BRISBANE

REASONS FOR JUDGMENT 1 This is an application pursuant to O 15A r 6 for discovery in advance of proceedings. The application arises out of dealings between the present applicant and a company, Adnam Pty Ltd ("Adnam"), a subsidiary of Ariadne Australia Limited, which led to the grant of a lease by Adnam to Alkan Investments Pty Ltd ("Alkan") over commercial premises in a Brisbane building (the "building"). The present applicant was a director and shareholder of Alkan. In about October 2001, representatives of Adnam disclosed to the applicant a letter dated 8 August 2001 from the present respondent, apparently written to an officer of Adnam. It seems that the respondent conducted educational activities in other parts of the building. In the letter, the writer said: 'I am more than happy to provide the following information to you regarding the operations of the College in our beautiful new Campus at 119 Charlotte Street, Brisbane. Please be aware the nature of this information I am providing you is commercially sensitive.' 2 The letter goes on to supply information concerning the operating times of its educational activities, the numbers of students, their demographic make-up, and college programs. These matters were of interest to Alkan and the applicant as Alkan proposed to operate a sandwich bar or similar operation in the building. Alkan has gone into liquidation, and I infer that the present applicant attributes its financial difficulties to its having entered into the lease with Adnam in reliance upon the letter of 8 August 2001 from the respondent. 3 The applicant asserts that he and his father, who were the directors and shareholders of Alkan, caused it to lease the premises, personally guaranteed funds advanced to it and invested money in it. He claims to be entitled to damages pursuant to the Trade Practices Act 1974 (Cth) for breach of s 52, read with s 51A, damages for fraudulent misrepresentation and/or damages in equity. 4 Order 15A r 6 provides: 'Where – (a) there is reasonable cause to believe that the applicant has or may have the right to obtain relief in the Court from a person whose description has been ascertained; (b) after making all reasonable inquiries, the applicant has not sufficient information to enable a decision to be made whether to commence a proceeding in the Court to obtain that relief; and (c) there is reasonable cause to believe that that person has or is likely to have or has had or is likely to have had possession of any document relating to the question whether the applicant has the right to obtain the relief and that inspection of the document by the applicant would assist in making the decision; the Court may order that that person shall make discovery to the applicant of any document of the kind described in paragraph (c).' 5 Paragraph 6(a) requires that an applicant have or 'may have' the right to obtain relief in the Court. Paragraph 6(c) requires that there be reasonable cause to believe that the prospective respondent has, or is likely to have, or has had or is likely to have had, possession of a document relating to the applicant's entitlement to relief, and that inspection of the document by the applicant will assist in making the decision to sue. Clearly, the respondent would have documents relating to student numbers at the relevant time. However, much of that information is already available to the applicant. It is, in my view, most unlikely that precise figures would be necessary or desirable in order to enable him to make a decision as to whether or not to commence these proceedings. It is theoretically possible that the respondent has, or may have had possession of documents disclosing the circumstances in which the letter was written. However there is no suggestion that it was written in response to any correspondence received from Adnam and no reason to believe that there are any such documents. 6 However there are, to my mind, two more fundamental questions which should be addressed. Firstly, it is by no means clear to me that the applicant or his father is an appropriate applicant for the relief sought. Prima facie, one would expect that the claim should be by the liquidator of Alkan. The decision of the High Court in Gould v Vaggelas (1985) 157 CLR 215 provides some support for the proposition that the present applicant may claim in certain circumstances but, as was demonstrated by the Full Court in Harris v Milfull (2002) 43 ACSR 542, the matter is complex. However I would not be inclined to dispose of the application upon the basis that the applicant has no claim. 7 The second matter of concern is the basis upon which it is said that the respondent can be made responsible for the disclosure of the content of the letter of 8 August 2001 to the applicant, his father or to Alkan. As I have said, the letter was said to be 'commercially sensitive', which I take to be an invitation to exercise care in the use to which it is put. It cannot be said that the subject matter would only be of interest to a landlord for use in attracting tenants. It seems much more likely to me that the information was obtained for the purpose of use in connection with management of the building. The letter does not refer to any earlier correspondence which might disclose the reason which underlay the writing of the letter. As far as I can see, there is no reason to believe that it was written with the expectation that it would be passed on to third parties. In those circumstances, I cannot see how it can be said that the applicant has, or may have the right to obtain relief against the respondent. To meet that test, there would, in my view, have to be some reason to believe that the letter was provided with the expectation that it would be passed on to third parties who were potential tenants. I see no justification for that conclusion. 8 In any event, it seems to me that the true claim, if any, should be mounted against Adnam as the corporation which made the relevant representation. It may be that in such proceedings, it will emerge that Adnam had passed on representations made by the present respondent, or that the respondent was aware of the purpose for which the letter of 8 August 2001 was required by Adnam. It may then be appropriate to consider joining the present respondent as a respondent in those proceedings. For the moment, I cannot see any basis for the relief sought. The application will be dismissed. The applicant is to pay the respondent's costs of the proceedings, including reserved costs. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dowsett.

Associate:

Dated: 28 June 2004 Solicitor for the Applicant: Ms R Black

Counsel for the Respondent: Mr P Tucker

Solicitor for the Respondent: Hunt & Hunt Lawyers

Date of Hearing: 1 June 2004

Date of Judgment: 1 June 2004