Capitalink Pty Ltd v Withnall

Capitalink Pty Ltd appealed to the Court of Appeal of New South Wales against a decision of Abadee DCJ concerning a breach of contract. The dispute centred on whether Capitalink had suffered or would suffer losses as a result of the breach, particularly in relation to costs incurred in rectifying the breach, some of which were paid by associated family companies and a real estate agent.

The Court of Appeal was required to determine whether Capitalink had adequately proven its losses, given that certain rectification costs were initially borne by family companies. This involved considering whether Capitalink had a legal obligation to reimburse these companies, thereby establishing that it had incurred losses. The court also had to assess the evidentiary basis for such an obligation, including whether a promise to repay could be implied from the circumstances and the available documentary evidence, and whether the principals of the family companies needed to give evidence. Furthermore, the court considered whether an argument raised on appeal was permissible, given that the trial may have proceeded, in part, outside the strict confines of the pleadings.

The Court of Appeal reasoned that while some costs were paid by third parties, the evidence, including documentary evidence and inferences drawn from the conduct of the parties, supported the conclusion that Capitalink was legally obliged to reimburse the family companies. The court found that the payments made by the real estate agent from a trust account in Capitalink's name also constituted losses incurred by Capitalink. The court allowed the appeal in part, finding that Capitalink had proven a portion of its claimed losses.

Consequently, the Court of Appeal set aside the original orders and entered judgment for Capitalink Pty Ltd in the sum of $133,160.51, plus interest, and ordered that the respondent pay Capitalink's costs of the appeal and the proceedings at first instance.