Francine* was employed as a book keeper by a sole trader concreting business in Tasmania. Francine’s employer was looking to expand his business when he came across a spray paving licensing opportunity with ‘We-Spray-U’* , based in Adelaide. We-Spray-U (WSU) marketed ‘packages’ which are said to include confidential business and technical material, training, on-going support and equipment in relation to concrete decorating and resurfacing.
Francine, on behalf of her employer, contacted WSU and spoke to a salesperson about purchasing a package. Discussions went on for several months during which time Francine was the primary contact person for her boss. Eventually, Francine’s employer signed a contract with WSU.
On the same date, Francine’s employer signed a vendor finance agreement with WSU. Francine, believing that she was witnessing the agreement, unwittingly signed as ‘Investor 2’, however, she never intended to be a party to the contract (and, in fact, did not sign the main contract).
Francine’s employer came to Adelaide to attend WSU’s training. However, he quickly became dissatisfied with the training and the parties mutually terminated the contract. The next day, WSU sent a notice purporting to ‘rescind’ the termination. Within days, WSU assigned the alleged debt to ‘B-Grade Collections’ (B-grade)*, a debt recovery company. B-grade issued proceedings in the Adelaide Magistrates’ Court against Francine and her employer seeking damages for the full contract sum (around $40,000).
Francine received some initial advice from legal aid in Tasmania, however, she needed lawyers in Adelaide. JusticeNet referred this matter to Rachel Teh from Gilchrist Connell who agreed to provide advice and representation. The matter did not settle before trial and Michael Burnett of Bar Chambers agreed to act as trial counsel.
At trial it was revealed that B-grade’s case on the construction of the contracts and why the termination was ineffective was wholly unsatisfactory, much less, why Francine should have been a party to the proceedings in the first place.
During the lunch adjournment B-grade agreed to a dismissal of the proceedings against Francine with no costs. Our thanks to Rachel Teh from Gilchrist Connell and Michael Burnett of Bar Chambers for helping Francine defend this action. As a single mother in receipt of government benefits, with two young sons, one of whom is autistic, a judgment debt against her, in these circumstances would have been devastating for her and her young family.