Birdanco Nominees Pty Ltd v Money

[2010] VCC 1566

IN THE COUNTY COURT OF VICTORIA Revised

(Not) Restricted

AT MELBOURNE
COMMERCIAL LIST

EXPEDITED CASES DIVISION

Case No. CI-10-00958

BIRDANCO NOMINEES PTY LTD	Plaintiff
v.
LIAM PAUL MONEY	Defendant

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JUDGE:	His Honour Judge Anderson
WHERE HELD:	Melbourne
DATE OF HEARING:	10 November 2010
DATE OF JUDGMENT:	10 November 2010 (revised 12 November 2010)
CASE MAY BE CITED AS:	Birdanco Nominees Pty Ltd v. Money
MEDIUM NEUTRAL CITATION:	[2010] VCC 1566

REASONS FOR JUDGMENT

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Catchwords:  Practice and procedure – Costs – Plaintiff’s claim dismissed –
Defendant’s offer of compromise ineffective in the circumstances –
Treated as “Calderbank” offer – Not “unreasonably refused” –
Defendant unsuccessful on certain defences – Inappropriate to reduce
defendant’s costs on this basis – Certification of counsel’s fees – Daily
brief fee with one day for preparation – Notice to admit – Appropriate to
“otherwise order” – Order 63A.18 County Court Rules of Civil
Procedure 2008.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr M.G. Rinaldi	Russell Kennedy
For the Defendant	Mr D.V. Aghion	Sackville Wilks
HIS HONOUR:

5

1           I gave judgment in this matter yesterday. I must now determine questions of costs. There are two issues:

a.	The effect of an offer of compromise made by the defendant’s solicitors on 25 June 2010;
b.	whether the defendant’s costs should be reduced because he was unsuccessful on a number of issues that were raised by way of defence.

2           The offer of compromise was to pay the sum of $10,000 to compromise the proceeding. The offer was not accepted. The offer of compromise was made pursuant to the Rules. The Rules do not, however, contemplate the situation where a plaintiff is unsuccessful altogether.

3           This is a matter that was dealt with by Byrne J in Foster v Galea [2008] VSC 331. In that case, an unaccepted offer of compromise was treated as a Calderbank offer. I consider that is the appropriate approach to take in this case. If the defendant’s offer is treated as a Calderbank offer, it is appropriate to consider the test enunciated in Hazeldene’s Chicken Farm Pty Ltd v Victorian Workcover Authority (No. 2) [2005] VSCA 298 and particularly whether it was unreasonable for the plaintiff to have rejected the offer, taking into account the factors set out by the Court of Appeal at paragraph 25 of the judgment. The relevant factors in the present case are the extent of the compromise offered and the offeree’s prospects of success, assessed as at the date of the offer.

4           The plaintiff’s claim was for approximately $200,000. At the hearing, quantum was conceded at the sum of $188,000. An offer of $10,000 in those circumstances, was a very small proportion of the plaintiff’s claim, and the offer was made at a time when some costs would have been incurred by the plaintiff. It would be difficult, in my view, to conclude that the rejection of the offer by the plaintiff was unreasonable, particularly in this case, as there were a number of previous decisions of courts where similar restraint clauses used by the plaintiff or predecessors of the plaintiff had been considered to be enforceable.

The defendant was successful on the principal issues in the case, the interpretation of clause, and the question of whether the liquidated damages clause was a genuine pre-estimate of the plaintiff’s loss. The defendant did not succeed on issues of duress, the issue of the plaintiff’s willingness or ability to continue to perform services and an issue of waiver or election. I consider, in the present case, that there was sufficient basis in relation to, particularly the first two of these three issues, for the defendant to have pursued them at the trial and no deduction or allowance to the plaintiff should be made in respect of his lack of success on those issues.

6           Plaintiff’s counsel, Mr Rinaldi, has indicated that an analysis of the transcript shows that approximately a quarter of the time spent on evidence at the trial was devoted to witnesses who primarily gave evidence about issues, in respect of which the defendant was unsuccessful. It is also apparent that much of the evidence contained in the expert report of Mr Lipson was not accepted. I consider, however, that in the context of this proceeding, a case which was disposed of in five sitting days, that it would be inappropriate to deprive the successful defendant of any costs as a result of its lack of success on these issues, or the fact that time was taken during the hearing exploring those issues.

7           It is necessary for me to certify counsel’s fees. I will certify counsel’s daily brief fee for each day of the trial, and I will make the ordinary allowance of one day’s preparation at the daily brief fee. In a case of this nature, I would have been inclined to allow a second day’s preparation, but I consider that in this case it is not appropriate to do so, primarily as I consider that some small allowance should be made for the additional time that was taken in the trial for the issues in respect of which the defendant was unsuccessful. For this reason, it would be inappropriate to allow greater preparation time than is ordinarily ordered.

8           I will order as follows:

1	The proceeding is dismissed.
2	The plaintiff must pay the defendant’s costs to be taxed on a party party basis on Scale D.
3	Certify counsel’s brief fee as follows:

i.         $2,500 for counsel’s brief to attend the mediation;

ii.        $3,800 for one day’s trial preparation;

iii.       $3,800 per day for the five days of the trial;

iv.       $1,900 for the appearances to hear judgment and the appearance today.

4           No costs shall be payable in respect of the disputing of facts which the defendant was requested to admit in the notice to admit dated 11 October 2010.

9           The residual issues relating to the plaintiff’s Notice to Admit which remained the subject of non-admissions, were relatively minor matters. It would probably cost far more to determine the question of whether the plaintiff had incurred additional costs as a result of the non-admissions than would be justified in the circumstances. For this reason, I consider it appropriate to “otherwise order” for the purposes of Rule 63A.18.

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Certificate

I certify that these 3 pages are a true copy of the reasons for decision of His Honour Judge

Anderson delivered on 10 November 2010 and revised on 12 November 2010.

Dated: 12 November 2010

Caroline Dawes

Associate to His Honour Judge Anderson