American Foods Pty Ltd v Davis & Anor

[2001] NSWCA 421

NEW SOUTH WALES COURT OF APPEAL

CITATION:      American Foods Pty Ltd v Davis & Anor [2001]  NSWCA 421

FILE NUMBER(S):
40258/01

HEARING DATE(S):            7 November 2001

JUDGMENT DATE: 07/11/2001

PARTIES:
American Foods Pty Ltd - Claimant
Anthony Martin Davis - First Opponent
Ian Robert Jones - Second Opponent

JUDGMENT OF:      Giles JA Rolfe AJA    

LOWER COURT JURISDICTION: District Court

LOWER COURT FILE NUMBER(S):        DC 5143/00

LOWER COURT JUDICIAL OFFICER:     Patten DCJ

COUNSEL:
M D Aldridge SC - Claimant
N/A - First Opponent
P J Brereton - Second Opponent

SOLICITORS:
John Cunningham - Claimant
Colin Biggers & Paisley - First Opponent
Corrs Chabmers Westgarth - Second Opponent

CATCHWORDS:
LEAVE TO APPEAL - no arguable error - no question of principle. ND

LEGISLATION CITED:

DECISION:
Application dismissed with costs.

JUDGMENT:

IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA  40258/01

DC 

GILES JA

ROLFE AJA

Wednesday 7 November 2001

AMERICAN FOODS PTY LTD v DAVIS & ANOR

Judgment

1. GILES JA:  This is an application for leave to appeal from the determination of a separate question by Patten DCJ.  The separate question was raised in proceedings by the client against its solicitors for negligence.  It was alleged that the solicitors failed to cause a limitations defence to be brought to a claim against the client.  The separate question was when the limitation period commenced to run for the claim against the client. 

2. Patten DCJ held that the claim against the client was a claim to indemnity, that the limitation period did not commence to run until the claimant had himself become out of pocket, and therefore that the limitation period did not commence to run until a late time such that a limitation defence was not available.

3. It was put to us that his Honour should have held that, by reason of letters of 17 March and 19 August 1988 between the client and the claimant against the client, the true claim against the client was a claim for damages for breach of contract consequent upon acceptance by the claimant of a repudiation by the client.  I do not think that there is a fairly arguable case of that.  It seems to me that the correspondence does not lend itself to that interpretation, and indeed some years later when the claimant through solicitors made his claim upon the client he did so expressly as a claim to indemnity under a contract for indemnity still on foot.  That is enough to call for refusal of leave.

4. However, the separate question was probably not the appropriate question.  The real issue was whether the solicitors should have caused the limitation defence to be brought, and that meant that it was necessary to look at the manner in which the claimant against the client put his case before the magistrate in the proceedings which led to judgment against the client.  It was submitted that, on looking at the manner the claimant put his case, it was a case of damages in the sense I have described, and not of indemnity.  I do not think that is the manner the case was put.  In the way the magistrate calculated interest on the amount involved there was some foundation for the view that the magistrate then saw the case as one of damages.  But it seems to me that, as the transcript shows, the magistrate went wrong at that point and was not saved from going wrong by the submissions of the parties.  Even as a fall-back position, not really arising in the application, in my opinion, there is no substance in the applicant’s arguments.

5. In my opinion there are insufficient grounds for the view that Patten DCJ was wrong in the answer to the question which he was asked to answer, and that the answer to a modified question which he should have been asked to answer would not lead to a different result.  I propose that the application be dismissed with costs.

6. ROLFE AJA:  I agree.

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LAST UPDATED:     22/11/2001