Toprise Fashions Ltd v Nik Nak Clothing Co Ltd & Ors

Summary judgment may be granted where a defence has no realistic prospect of success. The court must avoid a mini-trial, but need not accept factual assertions contradicted by contemporaneous documents. It must also consider evidence reasonably expected to be available at trial and should hesitate where fuller investigation could affect the outcome.

An allegation of fraud, without a properly pleaded and evidenced positive case, does not by itself prevent summary judgment. An implied term concerning the types of goods delivered may be arguable even where the contract regulates sorting by colour and size. The issue may nevertheless be resolved summarily where documentary evidence conclusively contradicts the alleged loss.

The claimant sought summary judgment for unpaid invoices arising from garment transactions with the defendants. The defendants alleged that one defendant acted as agent for Ya Ya Clothing, that goods supplied for Ya Ya and Wiener International were delivered in mixed orders, that delivery was late, and that samples were supplied pursuant to a trade practice without charge. They also raised an inadequately supported allegation concerning the origin and shipment of the goods.

The application concerned nine invoices. The court had to decide whether the pleaded defences and counterclaims had a realistic prospect of success or required trial.

1. Summary judgment test. The court adopted the principles summarised in Federal Republic of Nigeria v Santolina Investment Corp [2007] EWHC 437 (Ch). A defence must be realistic and carry some degree of conviction. The court must not conduct a mini-trial, but may reject factual assertions which have no real substance, particularly where contemporaneous documents contradict them. It must consider evidence reasonably expected to be available at trial. It should hesitate where fuller investigation might alter the evidence or outcome. Fraud is a relevant factor, but an unsupported allegation does not create an absolute bar.
2. Agency. The documents showed that Nik Nak placed orders in its own name, was invoiced as purchaser, invoiced Ya Ya as its customer, and had previously paid the claimant. Ya Ya’s records also contradicted the evidence that it had not paid. The agency defence therefore had no realistic prospect of success.
3. Mixed orders for Ya Ya. The pleaded implied term was vague, but the evidence made an implied term concerning different types of goods arguable. The contractual reference to unassorted cartons did not necessarily exclude such a term. However, documentary evidence showed that Ya Ya accepted the goods and paid Nik Nak’s invoices in full. The defence and counterclaim consequently had no realistic prospect of success.
4. Samples. An email stating that Nik Nak would pay for samples, together with the absence of particulars or evidence supporting the alleged contrary trade custom, justified judgment for the claimant on the sample invoices.
5. Wiener invoices. The evidence that Wiener had found different garments mixed in boxes and had passed a substantial charge to Nik Nak raised matters requiring factual investigation. Summary judgment was therefore inappropriate on those invoices.
6. The application was granted for the Ya Ya invoices, totalling US$427,363, and the sample invoices, totalling US$4,791. It was refused for the Wiener invoices.