Citadel Financial Corporation Pty Ltd v Elite Highrise Services Pty Ltd
[2016] NSWSC 400
•07 April 2016
Supreme Court
New South Wales
Medium Neutral Citation: Citadel Financial Corporation Pty Ltd v Elite Highrise Services Pty Ltd [2016] NSWSC 400 Hearing dates: 07 April 2016 Date of orders: 07 April 2016 Decision date: 07 April 2016 Jurisdiction: Equity Before: Meagher JA Decision: 1. Judgment for Citadel Financial Corporation Pty Ltd against Elite Highrise Services Pty Ltd in the sum of $865,830.
2. Order Elite Highrise Services Pty Ltd pay Citadel Financial Corporation Pty Ltd’s costs of the proceedings.
3. Grant leave to Elite Highrise Services Pty Ltd to apply to vary order 2, that leave to be exercised within 7 days of the date of these orders.Catchwords: CONTRACT – sale of goods – where agreement to purchase scaffolding equipment at price per tonne and equipment delivered – part payment – claim to balance – no question of principle Legislation Cited: Civil Procedure Act 2005 (NSW), s 100 Category: Principal judgment Parties: Citadel Financial Corporation Pty Ltd (Plaintiff)
Elite Highrise Services Pty Ltd (Defendant)Representation: Counsel:
Solicitors:
H W Somerville (Plaintiff)
Submitting Appearance (Defendant)
Bridges Lawyers (Plaintiff)
Sewell & Kettle (Defendant)
File Number(s): 2013/372920
Judgment – EX TEMPORE
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HIS HONOUR: The plaintiff, Citadel, seeks to recover from the first defendant, Elite, monies alleged to be due under an agreement by which Citadel sold scaffolding equipment to Elite.
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The proceedings as originally constituted joined as second defendant Mr Cohen, who is a director of Elite. The claim against Mr Cohen has been discontinued.
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At some stage after the proceedings were commenced, receivers and managers were appointed to Elite by a secured creditor, CML Payroll Pty Ltd. On 8 July 2015, those receivers and managers filed a submitting appearance on behalf of Elite. In its terms that appearance submits to the making of all orders sought and the giving or entry of judgment in respect of all claims made, except as to costs.
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In support of its claim Citadel read and relies upon the affidavits of Mr Antonio Andrew Maiolo sworn 1 April 2016 and Mr Robert Mohamad Ali sworn 5 December 2014. In addition, the documents exhibited to Mr Maiolo's affidavit were tendered.
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I have read that evidence and make the following findings as to the matters relevant to Citadel's claim.
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In 2012 and 2013, Mr Maiolo was the director of Citadel and authorised to act on its behalf in negotiating for the sale of its scaffolding equipment. At some stage before February 2012, Citadel had carried on a scaffolding business which included the ownership of scaffolding equipment. Later in that year, it decided to sell that equipment. As at January 2013, Citadel owned approximately 3,900 tonnes of such equipment.
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Mr Cohen, in his capacity as a director of Elite, authorised Mr Ali to negotiate with Mr Maiolo for Elite to purchase some or all of that scaffolding equipment. There followed, in early 2013, a series of conversations between Mr Maiolo and Mr Ali concerning the basis on which Elite would purchase that equipment.
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The terms of the proposed arrangements changed over time. However, two matters remained fairly constant. The first was that Elite would purchase some or all of the scaffolding equipment. The second was that the price to be paid was $700 per tonne plus GST.
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In mid-February 2013, two payments, collectively described as a deposit for equipment to be provided, were made by Elite to Citadel. Those amounts totalled $250,000.
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Shortly after those payments were made, Elite attended Citadel's premises and took delivery of a quantity of scaffolding equipment. The exact weight of the equipment taken is not disclosed by the evidence. Subsequently, in March 2013, a request was made that Elite be permitted to take delivery of further equipment, and that occurred.
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Of the original 3,900 tonnes of scaffolding equipment which Citadel held as at January 2013, after account was taken of the equipment delivered to or taken by Elite, only 2,400 tonnes remained. Mr Maiolo says, and I accept, that during this period no part of the original quantity of equipment was sold to or removed by any other party. This permits a conclusion that the weight of the scaffolding equipment taken by and delivered to Elite in February and March 2013 was around 1,500 tonnes.
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The evidence also establishes that, notwithstanding requests for further payment or for the return of that equipment, Elite has made no further payments to Citadel beyond the $250,000 deposit.
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In these circumstances, the evidence justifies the conclusion that Elite is indebted to Citadel in an amount of $905,000, being 1,500 tonnes at $770 per tonne (including GST), less $250,000.
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However, as the amount pleaded and claimed in the Amended Summons and Amended Commercial List Statement is $865,830, the amount for which Citadel is entitled to have judgment is that lesser amount, in view of the fact that Elite is not present, has not been given notice of any amended and increased claim and filed its submitting appearance at a time when the lesser amount was claimed.
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Citadel also claims interest on that amount to the date of judgment under s 100 of the Civil Procedure Act 2005 (NSW).
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That section permits the Court to include interest in an amount for which judgment is given. However, it does not confer an automatic entitlement to interest. Whilst it may be accepted that in the absence of any more specific agreement Elite was liable to pay the unpaid purchase monies within a reasonable time, it necessarily remains the position that to be entitled to an award of interest under s 100, Citadel must also prove that it has in some way suffered a real and practical loss resulting from the delay in payment.
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In the present case, there is no evidence as to what Citadel would have done with the funds and whether they would have been used to repay debt, invested or dealt with in some other way in its business. Having regard to the somewhat unusual circumstances in which the agreement sued upon was made, the nature of those rather informal arrangements and the fact that they changed over time, I am not prepared, in the absence of any evidence, to infer that Citadel must have suffered some loss as a result of the delay in receiving payment of the monies which it claims.
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Accordingly, I make the following orders:
1. Judgment for Citadel Financial Corporation Pty Ltd against Elite Highrise Services Pty Ltd in the sum of $865,830.
2. Order Elite Highrise Services Pty Ltd pay Citadel Financial Corporation Pty Ltd’s costs of the proceedings.
3. Grant leave to Elite Highrise Services Pty Ltd to apply to vary order 2, that leave to be exercised within 7 days of the date of these orders.
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Decision last updated: 08 April 2016
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