Broadlex Services v RCR Resolve FM - [2015] NSWSC 1668

Supreme Court

New South Wales

Medium Neutral Citation: Broadlex Services v RCR Resolve FM; (No 3) [2015] NSWSC 1668
Hearing dates: 7 September 2015, 8 September 2015, 9 September 2015, 10 September and 11 September 2015
Date of orders: 03 November 2015
Decision date: 03 November 2015
Jurisdiction: Equity - Commercial List
Before: McDougall J
Decision:
Defendant to pay 60% of plaintiff’s costs of the proceedings.

Catchwords: COSTS – claim and cross-claim – claimant in each succeeds – verdicts accordingly – judgment for plaintiff for balance after set-off – whether costs should follow each event and then be set off – where amount in issue was not large – where complexity of issues would necessitate a costly assessment – consequence that interests of justice favour a broad brush approach
Legislation Cited: Civil Procedure Act 2005 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited: Barescape Pty Limited v Bacchus Holdings Pty Limited (No 12) [2012] NSWSC 1591
McDonnell and East Limited v McGregor (1936) 56 CLR 50
Category: Costs
Parties: Broadlex Services Pty Ltd (Plaintiff / Cross-Defendant)
RCR Resolve FM Pty Ltd (Defendant / Cross-Claimant)
Representation:
Counsel:
R C Gration (Plaintiff / Cross-Defendant)
T J Breakspear (Defendant / Cross-Claimant)
Solicitors:
Johnson Winter & Slattery (Plaintiff / Cross-Defendant)
Kennedys (Defendant / Cross-Claimant)

File Number(s): 2014/69596

Judgment

HIS HONOUR: In these proceedings the plaintiff claimed payment of about $241,000 for services provided by it to the defendant. The defendant did not suggest that the services had not been provided, or that they had been performed inadequately. Rather, the defendant relied on a cross-claim, and defence by way of set-off.
To enable what follows to be understood, I set out paras 1 to 8 of my reasons given on 16 October 2015 [2015] NSWSC 1514:

1   HIS HONOUR:   The plaintiff (Broadlex) contracted with the defendant (Resolve) to supply cleaning services at the Villawood Immigration Detention Centre (VIDC) and a related “facility” known as Villawood Immigration Residential Housing (VIRH). It is common ground that Resolve has not paid Broadlex the value of some nine invoices for services, amounting in total to a little over $241,000.00. Resolve does not suggest that the services the subject of those invoices were not performed, or were not performed appropriately. It defends the claim by way of what might be called confession and avoidance, together with a claimed set off, and a cross-claim.
The issues
2   The real issues in dispute are, in substance:
(1)   on the proper construction of the contract made between Broadlex and Resolve, what services was Broadlex required to perform for the fixed remuneration payable to it?
(2)   If the contract is construed as Resolve submits, so that Broadlex was required to provide more services than it did (for reasons that will become apparent, I will call those the “extra charge services”), did the parties nonetheless conduct their relationship on the conventional basis that Broadlex should be paid additional remuneration for those services, so as to give rise to a conventional estoppel?
(3)   If…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2015] NSWSC 1668
Decision Date: 03 November 2015

CaseChat Overview and Summary

Broadlex Services, an Australian company, initiated legal proceedings against RCR Resolve FM, another Australian company, to recover unpaid invoices. The Federal Court of Australia was tasked with resolving this dispute, which involved both a claim and a cross-claim. Broadlex alleged that RCR Resolve FM had not paid for services rendered, while RCR Resolve FM countered that Broadlex had not fulfilled its contractual obligations. The court was required to determine the merits of both the claim and the cross-claim, and subsequently decide on the costs associated with each party's success in their respective claims.

The primary legal issue before the court was how to allocate costs between the parties. Both Broadlex and RCR Resolve FM had succeeded in part in their claims against each other. The court had to consider whether costs should be awarded in accordance with the outcome of each individual event or if a more general approach was appropriate. Additionally, the court needed to weigh the complexity and the relatively small financial stakes of the dispute against the potential costs of a detailed assessment of each event.

The court found that the interests of justice were best served by adopting a broad brush approach to the allocation of costs. Given the relatively small amount in dispute and the complexity of the issues, a detailed assessment of each event would be unnecessarily costly. Therefore, the court ruled that costs should follow the event and then be set off. The court determined that Broadlex was entitled to judgment for the balance after set-off, resulting in a final order in favour of Broadlex for the net amount due.

Orders