El-Hanania v Vella (No.4)
[2020] FCCA 265
•14 February 2020
FEDERAL CIRCUIT COURT OF AUSTRALIA
| EL-HANANIA v VELLA (No.4) | [2020] FCCA 265 |
| Catchwords: LEGAL PRACTITIONERS – COSTS – Lawyer of client retained money purportedly on account of the costs of providing legal services to the client that exceeded the amount for which those legal costs had been determined as recorded in a costs certificate (overpayment) issued under Legal Profession Act 2004 (NSW) (2004 LP Act) – whether the preconditions for recovering the overpayment as a debt under s.368(4) of the 2004 LP Act satisfied – preconditions satisfied – judgment for the client against the lawyer granted in the amount of the overpayment together with interest on that amount. |
| Legislation: Bankruptcy Act 1966 (Cth), ss.30(1)(b), 40(1)(g), 41, 41(6A) Judiciary Act 1903 (Cth), s.79(1) |
| Cases cited: Baxter v Obacelo Pty Ltd [2001] HCA 66; (2001) 205 CLR 635 El-Hanania v Vella [2019] FCCA 1555 El-Hanania v Vella (No.2) [2019] FCCA 2907 El-Hanania v Vella (No.3) [2019] FCCA 3287 Haines v Welch (1868) L.R., 4, C.P., 91 Oliveri v Stafford (1989) 24 FCR 413 Philip Morris Inc v Adam P Brown Male Fashions Pty Ltd (1981) 148 CLR 457 Rana v Google Inc [2017] FCAFC 156 Re Wakim [1999] HCA 27; (1999) 198 CLR 511 Taylor v Vivacity Engineering Pty Ltd [2019] FCCA 1751 |
| Applicant: | SABA EL-HANANIA |
| Respondent: | ALON JOSEPH VELLA |
| File Number: | SYG 2258 of 2018 |
| Judgment of: | Judge Manousaridis |
| Hearing date: | 6 February 2020 |
| Date of Last Submission: | 7 February 2020 |
| Delivered at: | Sydney |
| Delivered on: | 14 February 2020 |
REPRESENTATION
| No appearance by or on behalf of the Applicant |
| Solicitors for the Respondent: | Mr T Wallace of Sewell & Kettle Lawyers |
JUDGMENT
The applicant, Saba El-Hanania, pay to the respondent, Alon Joseph Vella, $252,835.83
ORDERS
Bankruptcy notice no. BN226177 issued on 26 July 2018 on the application of the respondent, Alon Joseph Vella, and served on the applicant, Saba El-Hanania, is set aside.
Other than the costs the applicant, Saba El-Hanania, on 3 October 2019 was ordered to pay to the respondent, Alon Joseph Vella, each party bear his own costs.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 2258 of 2018
| SABA EL-HANANIA |
Applicant
And
| ALON JOSEPH VELLA |
Respondent
REASONS FOR JUDGMENT
Introduction
On 15 November 2019 I published reasons for judgment (earlier reasons) on the basis of which I made a declaration that a bankruptcy notice that had been issued on the application of the respondent, Mr Vella, and served on the applicant, Mr El-Hanania, is liable to be set aside.[1] I also made directions that the parties file written submissions in relation to the following two questions:
a)Question 1: Does the Federal Circuit Court of Australia (Court) have jurisdiction to determine in the proceeding constituted by the application to set aside the Bankruptcy Notice whether the $212,765.37 for which the Judgment was given, apart from the Judgment, nevertheless represents a debt within the meaning of s.368(4) of the Legal Profession Act 2004 (NSW) (2004 LP Act) and, if it so determines, give judgment in the amount of the debt?[2]
b)Question 2: Assuming (a) is answered the affirmative, does the $212,765.37 for which the Judgment was given, apart from the Judgment, nevertheless represent a debt for the purposes of s.368(4) of the 2004 LP Act and, if so, is it open to the Court to direct the entry of judgment in the amount of the debt, together with interest?
[1] El-Hanania v Vella (No.3) [2019] FCCA 3287. These reasons for judgment assume familiarity with my earlier judgment.
[2] The “Bankruptcy Notice” and “Judgment” to which Question 1 refer are the “Bankruptcy Notice” and “Judgment” identified and in the declaration I made on 15 November 2019.
The $212,765.37 (Agreed Amount) referred to in the Questions is the amount Mr Vella and Mr El-Hanania agreed represented the difference between money Mr El-Hanania retained from money he held in trust for Mr Vella purportedly on account of Mr El-Hanania’s costs of acting for Mr Vella in what, in the earlier reasons, I referred to as the “PI claim”, and the $44,452.85 a costs assessor determined as the fair and reasonable amount of the costs of the work Mr El-Hanania performed.[3] The determination of the costs assessor is recorded in a document titled “Certificate of Determination of Costs” issued on 11 September 2017 (Costs Certificate).[4] The Costs Certificate was issued pursuant, or purportedly pursuant, to s.368(1) of the 2004 LP Act.
[3] El-Hanania v Vella (No.3) [2019] FCCA 3287, at [33]
[4] El-Hanania v Vella (No.3) [2019] FCCA 3287, at [11]. In that paragraph I said that the Costs Certificate was issued on 10 October 2017. That is incorrect. The Costs Certificate was issued on 11 September 2017 and was sent to the parties on 10 October 2017.
The parties filed and served written submissions, and the matter came before me on 20 December 2019. On that day I set the matter down for further hearing at 2:15 pm on 6 February 2020. At the appointed time and day Mr Vella appeared by his lawyer, Mr Wallace. Mr El-Hanania, however, did not appear. I proceeded to hear the matter.
Mr Wallace filed in Court an application in a case seeking an order that Mr El-Hanania pay to Mr Vella the Agreed Amount together with interest. I reserved judgment, and listed the matter for judgment at 9:30 am on 14 February 2020. I gave Mr Wallace liberty to provide me through my associate a short note stating the amount of interest Mr Vella would be claiming up to and including 14 February 2020, and setting out the calculations of the interest Mr Vella claims.
Parties’ submissions and issues arising
In his written submissions Mr Vella submits this Court has jurisdiction to determine whether the Agreed Amount represents a “debt” within the meaning of s.368(4) of the 2004 LP Act; that the Agreed Amount represents a “debt” within the meaning of that provision; and that judgment should be entered against Mr El-Hanania in the sum of the Agreed Amount, together with interest.
In relation to Question 1, Mr El-Hanania, in his written submissions, submits this Court does not have jurisdiction to enter judgment for the agreed amount because Mr Vella “has not issued the Statement of claim [sic] as required by section 368(4)” of the 2004 LP Act. Mr El-Hanania, in effect, submits that the “debt” to which s.368(4) of the 2004 LP Act applies can only be recovered by Mr Vella commencing fresh proceedings by way of statement of claim; and that is because the person against whom a debt under s.368(4) of the 2004 LP Act may be recovered must be given an opportunity to raise a defence. Mr El-Hanania submits this Court cannot of its own motion enter judgment.
Mr El-Hanania purports to answer Question 2 by submitting it is the same as Question 1, and, for that reason, is to be answered in the same way: Mr Vella “[m]ust issue a statement of claim so that the defendant has the opportunity to answer to the statement of claim”.[5] Mr El-Hanania does not submit he has a defence to Mr Vella’s being entitled to recover as a debt the Agreed Amount. Mr El-Hanania only refers to the possibility of a defence without identifying the nature of the defence he submits he may have.
[5] Applicant’s Outline of Submissions filed 17 December 2019, [8]
The following questions, therefore, arise:
a)Does the right to recover a debt to which s.368(4) of the 2004 LP Act apply depend on its being recovered by means of a statement of claim?
b)However (a) is answered, does this Court have jurisdiction to determine Question 1?
c)Assuming (a) is answered in the negative, and (b) is answered in the affirmative, what is the answer to Question 2?
Recovery of debt under s.368(4) of the 2004 LP Act
The means by which a debt can be recovered under s.368(4) of the 2004 LP Act turns on the proper construction of that subsection. The starting point is the text of s.368(4), which provides:
In the case of an amount of costs that has been paid, the amount (if any) by which the amount paid exceeds the amount specified in any such certificate may be recovered as a debt in a court of competent jurisdiction.
“Any such certificate” is a reference to the certificate mentioned in s.368(1) of the 2004 LP Act, which provides:
On making a determination of costs referred to in Subdivision 2 or 3 of this Division, a costs assessor is to issue a certificate that sets out the determination.
Thus s.368(4) of the 2004 LP Act is engaged if:
a)a costs assessor has made a determination of costs of the sort referred to in Subdivision 2 or 3 of “this Division”, that is, of Division 11 of Part 3.2 of the 2004 LP Act;
b)the costs assessor has issued a certificate under s.368(1) that sets out the costs assessor’s determination;
c)an amount of costs has been paid; and
d)the amount of costs that has been paid exceeds the amount specified in the costs certificate.
When engaged, the difference between what has been paid and the amount specified in the certificate (overpayment) “may be recovered as a debt in a court of competent jurisdiction”. The word “recover” is of ancient usage in the common law. Its core meaning is “obtaining any thing by judgment or trial of Law”,[6] or enforcing a legal right “by action”. While, however, “in strict legal language” “recover” might mean “recover by action”, by the middle of the nineteenth century “recover” was “often used in the larger sense of obtaining in any legal manner”.[7]
[6] Jacob, G., The Law Dictionary, P Byrne, Philadelphia, 1811, Vol V, page 401
[7] Haines v Welch (1868) L.R., 4, C.P., 91, at page 93
The expression “may be recovered as a debt” in s.368(4) of the 2004 LP Act, therefore, is to be understood as conferring on a person who has made an overpayment the right to apply in a court of competent jurisdiction for judgment against the lawyer who has been overpaid in an amount equal to the overpayment. It creates a statutory cause of action in debt, the elements of which are those I have identified in paragraph 11 of these reasons. Subsection 368(4) of the 2004 LP Act, however, does not prescribe the means by which such right may be exercised; it assumes that the right to apply for such judgment is to be exercised according to the rules of procedure of the competent court in which the person entitled to recover the overpayment elects to recover it.
I therefore do not accept Mr El-Hanania’s submission that s.368(4) of the 2004 LP Act requires that overpayments must be recovered by the filing of a statement of claim. The judgment for overpayments to which s.368(4) of the 2004 LP Act applies may be recovered in the manner permitted by the rules of the competent court in which the person entitled to recover the overpayment elects to recover it.
Jurisdiction to entertain recovery of overpayment
The exercise of jurisdiction by this Court is limited to the grants of jurisdiction Parliament confers on it under laws validly made under s.77(i) of the Constitution. The Court does not have general jurisdiction to entertain actions of debt and, for that reason, the Court would not have jurisdiction to entertain an action under s.368(4) of the 2004 LP Act for the recovery of an overpayment if that were the only claim for relief that was attempted to be brought before it. The Court, however, will have jurisdiction to entertain a claim for relief for which it might not otherwise have jurisdiction if such claim for relief forms part of a “matter” in relation to which the Court does have jurisdiction.
“Matter”, when used in relation to the expression “arising under any laws made by the Parliament” in s.76(ii) of the Constitution, means a set of alleged facts that have such a degree of commonality as to give rise to one justiciable controversy, even though the one controversy may give rise to more than one claim for relief or defence, provided that at least one of the claims for relief or at least one defence is alleged to arise under a law of the Parliament. Different expressions have been used to describe the required degree of commonality among alleged facts before they can properly be characterised as giving rise to one justiciable controversy. An influential formulation is that given by Mason J (as his Honour then was) in Philip Morris Inc v Adam P Brown Male Fashions Pty Ltd, who referred to “common transactions and facts” arising “out of a common substratum of facts”.[8] Also influential is the following formulation given by Gummow and Hayne JJ in Re Wakim:[9]
What is a single controversy ‘‘depends on what the parties have done, the relationships between or among them and the laws which attach rights or liabilities to their conduct and relationships’’. There is but a single matter if different claims arise out of ‘‘common transactions and facts’’ or ‘‘a common substratum of facts’’, notwithstanding that the facts upon which the claims depend ‘‘do not wholly coincide’’. So, too, there is but one matter where different claims are so related that the determination of one is essential to the determination of the other, as, for example, in the case of third party proceedings or where there are alternative claims for the same damage and the determination of one will either render the other otiose or necessitate its determination. Conversely, claims which are ‘‘completely disparate’’, ‘‘completely separate and distinct’’ or ‘‘distinct and unrelated’’ are not part of the same matter.
Often, the conclusion that, if proceedings were tried in different courts, there could be conflicting findings made on one or more issues common to the two proceedings will indicate that there is a single matter. By contrast, if the several proceedings could not have been joined in one proceeding, it is difficult to see that they could be said to constitute a single matter.
[8] (1981) 148 CLR 457, at page 512
[9] [1999] HCA 27; (1999) 198 CLR 511, at [140]- [141] (references omitted)
In Rana v Google Inc the Full Federal Court provided the following explanation of “matter”:[10]
The “matter” is the justiciable controversy between the parties arising out of the substratum of facts and claims representing, or amounting to, the dispute or controversy between or amongst the parties. Where federal and non-federal claims comprise the same justiciable controversy, a court exercising federal jurisdiction will have jurisdiction to resolve the entire matter in the exercise of its federal jurisdiction.
[10] [2017] FCAFC 156, at [17]
Whether this Court has jurisdiction to determine a claim under s.368(4) of the 2004 LP Act for the recovery of the Agreed Amount as a debt depends, therefore, on, first, whether there is before the Court a claim for relief that is, or which may form part of, a “matter” in relation to which the Court has jurisdiction; and, second, whether Mr Vella’s claim for judgment under s.368(4) of the 2004 LP Act arises out of the same substratum of facts out of which the claim for relief in relation to which this Court has jurisdiction arises.
A single “matter”?
The claims that are before the Court include a claim Mr El-Hanania makes for setting aside the bankruptcy notice. The bankruptcy notice was issued under s.41 of the Bankruptcy Act 1966 (Cth) (Act). Subsection 27(1) of the Act confers concurrent “jurisdiction in bankruptcy” on this Court and on the Federal Court of Australia. Although the Act does not confer an express power on the Court to set aside a bankruptcy notice, the Court has power to do so. The principal source of power is s.30(1)(b) of the Act which provides that the Court may make “such orders (including declaratory orders and orders granting injunctions or other equitable remedies) as the Court considers necessary for the purposes of carrying out or giving effect to this Act in any such case or matter”.[11] Another source of power is s.41(6A) of the Act, which empowers the Court to extend the time for compliance with the requirements of a bankruptcy notice if, before the time for complying with those requirements, the debtor has, among other things, applied to set aside the bankruptcy notice. The power of the Court to extend the time for compliance with the requirements of a bankruptcy notice carries with it the power to set aside the bankruptcy notice itself.[12]
[11] Oliveri v Stafford (1989) 24 FCR 413 at page 430 (Gummow J)
[12] Re Sterling; Ex parte Esanda Ltd (1980) 44 FLR 125 at page 130 (Lockhart J)
Thus, there is before the Court a “matter” in relation to which this Court has jurisdiction that at the very least consists of a claim by Mr El-Hanania for an order that the bankruptcy notice issued against him be set aside. There is also before the Court, however, an application by Mr Vella under s.368(4) of the 2004 LP Act for the entry of judgment in the sum of the Agreed Amount, together with interest. Mr Vella first made this claim for relief when his lawyer filed his written submissions on 13 December 2019, after I had delivered my earlier reasons in which I concluded the bankruptcy notice is liable to be set aside. That by itself does not, however, deny the possibility that Mr Vella’s claim for judgment arises out of the same substratum of facts as that out of which Mr El-Hanania’s application to set aside the bankruptcy notice arises. A “matter” denotes a controversy arising out of the same, or substantially the same substratum of facts, not a proceeding; and, provided there is a controversy arising out of the same, or substantially the same substratum of facts, it does not matter when claims for relief based on that controversy are made in the one proceeding, or even if they are made in different proceedings. In any event, as will appear shortly, Mr Vella submitted before I delivered my earlier reasons that the Agreed Amount constituted a “debt” within the meaning of s.368(4) of the 2004 LP Act.
I next consider whether Mr Vella’s claim for judgment under s.368(4) of the 2004 LP Act arises out of the same or substantially the same substratum of facts as Mr El-Hanania’s claim for an order to set aside the bankruptcy notice. That is to be determined by reference to the grounds on which Mr El-Hanania sought to set aside the bankruptcy notice, and the submissions parties made in the course of the hearing. And here I need only refer to two things. The first is paragraph 4 of his amended application, which Mr El-Hanania claims:
An Order that the court is entitled to go behind any asserted final judgement [sic] or order recorded as being relied upon for the purpose of the issue of Bankruptcy Notice number BN 226177 issued 26 July 2018 to determine whether there is any underlying entitlement to the recorded final judgement [sic] or order relied upon.
The second is the following submissions Mr Vella, through his lawyer, made in his written submissions dated 13 November 2019 (emphasis added):[13]
[22] However, if the Court is minded to find that there is a substantial reason to go behind the Judgment, it is the submissions of the Respondent that the Court will find the existence of a costs assessment that states that the Applicant overcharged the Respondent for the legal services and has retained the benefit of what is owed, which amounts to a debt. . . . [25] The Respondent submits that there is no allegation of jurisdictional error, or any error for that matter, relied upon by the Applicant in respect of the costs determination. . . . [28] In the circumstances, there is a debt owing to the Respondent by the Applicant, being the total retained less the assessed amount. It is the submission of the Respondent that this debt exists independent of the Judgment and therefore, in truth and reality, there is a debt owing to the Respondent underpinning it.
[13] The Respondent’s Outline Submissions, [22], [25], [28]
In my opinion, Mr El-Hanania’s claim to set aside the bankruptcy notice, and Mr Vella’s claim for judgment under s.368(4) of the 2004 LP Act, arise out of the same, or substantially the same, substratum of facts. These are Mr El-Hanania retaining money purportedly on account of his legal costs; the facts leading to the issue of the Costs Certificate; the issue of the Costs Certificate; the entry of judgment on the basis of the registration of the Costs Certificate; the circumstances in which Mr El-Hanania and Mr Vella agreed to the Agreed Amount and the entry of judgment based on the Agreed Amount; and the issue of the bankruptcy notice against Mr El-Hanania on the basis of the judgment for the Agreed Amount. Mr El-Hanania relied on these facts to contend, first, that the judgment was not a judgment authorised by the 2004 LP Act and, therefore, a “judgment” or “order” within the meaning of s.40(1)(g) of the Act and, second, that there was no underlying entitlement to the judgment on the basis of which the bankruptcy notice was issued. Ground 4 of the amended application invites the Court to go behind the judgment and determine that question. Mr Vella, on the other hand, relies on the same facts for claiming judgment under s.368(4) of the 2004 LP Act.
The Court, therefore, has jurisdiction to determine whether the Agreed Amount represents a debt within the meaning of s.368(4) of the 2004 LP Act.[14]
[14] I have considered whether s.79(1) of the Judiciary Act 1903 (Cth) “picks up” s.368(4) of the 2004 LP Act, and I am in no doubt that it does. That means that s.368(4) of the 2004 LP Act is binding on this Court in relation to the matter I have found is before the Court. I have relied on my understanding of s.79(1) of the Judiciary Act 1903 (Cth) as set out in Taylor v Vivacity Engineering Pty Ltd [2019] FCCA 1751, at [54]-[58]
Power to enter judgment?
I next consider whether, assuming it has jurisdiction to determine whether the Agreed Amount represents a debt within the meaning of s.368(4) of the LP Act, the Court has the power to enter judgment for the Agreed Amount and interest. That is to be determined, in part, by various provisions of the Federal Circuit Court Act 1999 (Cth) (FCC Act) and the Federal Circuit Court Rules 2001 (Cth) (FCC Rules), and, in part, by the manner in which Mr Vella has applied for judgment. First, there is s.14 of the FCC Act, which provides:
In every matter before the Federal Circuit Court of Australia, the Federal Circuit Court of Australia must grant, either:
(a) absolutely; or
(b) on such terms and conditions as the Federal Circuit Court of Australia thinks just;
all remedies to which any of the parties appears to be entitled in respect of a legal or equitable claim properly brought forward by him or her in the matter, so that, as far as possible:
(c) all matters in controversy between the parties may be completely and finally determined; and
(d) all multiplicity of proceedings concerning any of those matters may be avoided.
Next, there is r.16.01 of the FCC Rules which provides:
The Court may, at any stage in a proceeding on the application of a party, give any judgment or make any order even if the claim was not made in an originating process.
Given I have found the Court has jurisdiction to determine an application under s.368(4) of the 2004 LP Act for the recovery of judgment for the Agreed Amount, s.14 of the FCC Act confers power to order judgment, assuming Mr Vella establishes the matters provided by s.368(4) of 2004 LP Act. I am also satisfied that Mr Vella has applied for such judgment. It is not necessary that Mr Vella make such application in an originating process. For that reason, although I granted Mr Wallace leave to file in court an application in a case, I do not consider it is necessary that Mr Vella file the application in a case with the Registry. I have, however, marked as “MFI1” the application in a case Mr Wallace handed up to me at the hearing on 6 February 2020.
Finally, there is the power to award interest. Subsection 76(2) of the FCC Act provides that an application may be made for interest under s.76(3). Subsection 76(3) provides that if an application is made for an order under s.76(2) of the FCC Act, and if the Court is not satisfied that good cause has been shown for not making an order for interest under s.76(3) of the FCC Act, the Court must either:
(c)order that there be included in the sum for which judgment is given interest at such rate as the Federal Circuit Court of Australia or the Judge thinks fit on the whole or any part of the money for the whole or any part of the period between:
(i) the date when the cause of action arose; and
(ii) the date as of which judgment is entered; or
(d)without proceeding to calculate interest in accordance with paragraph (c), order that there be included in the sum for which judgment is given a lump sum in lieu of any such interest.
Entitlement to recovery of Agreed Amount and interest
Whether Mr Vella is entitled to recover judgment for the Agreed Amount depends on whether the matters on which the engagement of s.368(4) of the 2004 LP Act depends, as I have identified them in paragraph 11 of these reasons, are satisfied. I find they are satisfied:
a)A costs assessor determined that $44,452.85 represents the fair and reasonable amount of the costs of the work Mr El-Hanania performed for acting for Mr Vella in the PI claim, and the costs assessor issued a costs certificate pursuant to s.368(1) of the 2004 LP Act recording his determination.[15]
b)The Costs Certificate is one that has been validly issued under s.368(1) of the 2004 LP Act, even though it contains two items of information that the subsection does not require, namely, “Note 2” which provides that the “costs applicant has previously paid the sum of $294,671.85”; and the purported direction that the “costs respondent is to pay to the costs applicant the sum of $250,219.24”. That Costs Certificate sets out that which s.368(1) of the 2004 LP Act requires it to set out, namely, the costs assessor’s determination. The additional information is irrelevant to the costs assessor’s determination.
c)Mr El-Hanania applied for a review of that determination, but, on 6 December 2017, the review panel affirmed the costs assessor’s determination.[16]
d)Mr El-Hanania has not claimed anywhere that the determination of the costs assessor is affected by jurisdictional error and, for that reason, is liable to be set aside or ignored as not recording a lawful determination.
e)Mr El-Hanania and Mr Vella have agreed that the difference between the amount Mr El-Hanania has withheld on account of his costs for acting for Mr Vella in the PI claim and the $44,452.85 the costs assessor determined was the fair and reasonable amount of the costs of that work is $212,765.37 (being the Agreed Amount).[17]
f)The Agreed Amount is the difference between the amount Mr Vella paid to Mr El-Hanania on account of his purported costs and the costs assessor’s determination of Mr El-Hanania’s costs set out in the Costs Certificate.
[15] El-Hanania v Vella (No.3) [2019] FCCA 3287, at [11].
[16] El-Hanania v Vella (No.3) [2019] FCCA 3287, at [12]
[17] El-Hanania v Vella (No.3) [2019] FCCA 3287, at [33]
It follows that Mr Vella is entitled to recover the Agreed Amount under s.368(4) of the 2004 LP Act “as a debt in a court of competent jurisdiction” by applying for and obtaining a judgment in an amount equal to the Agreed Amount. Given that Mr Vella has so applied in this Court, and I have found the Court has jurisdiction to determine such application, judgment should be entered in favour of Mr Vella against Mr El-Hanania for an amount that at the very least consists of the Agreed Amount.
I am not satisfied that good cause has been shown for not making an order for interest under s.76(3) of the FCC Act. Mr Vella, therefore, is entitled to interest on the Agreed Amount. Mr Vella claims interest from 11 September 2017 (being the date on which the costs certificate was issued) up to 14 February 2020, which I have calculated as follows:
Period Start
Period End
Days
Interest rate
Amount
11/09/2017
31/12/2017
112
5.50%
$3,590.78
1/01/2017
30/06/2017
181
5.50%
$5,802.96
1/07/2017
31/12/2017
184
5.50%
$5,899.14
1/01/2018
30/06/2018
181
5.50%
$5,802.96
1/07/2018
31/12/2018
184
5.50%
$5,899.14
1/01/2019
30/06/2019
181
5.50%
$5,802.96
1/07/2019
31/12/2019
184
5.50%
$5,899.14
1/01/2020
14/02/2020
45
5.25%
$1,373.38
TOTAL
$40,070.46
I have calculated interest by applying the rates prescribed by the Interest on Judgments Practice Note (GPN-INT) issued by the Federal Court of Australia. That practice note provides for an interest rate of 4% above the cash rate or rates last published by the Reserve Bank of Australia for the six-month period preceding the period for which interest is to be calculated.
Disposition
I propose to order that the bankruptcy notice issued against Mr El-Hanania be set aside, and that Mr Vella have judgment against Mr El-Hanania in the amount of $252,835.83, being the sum of the Agreed Amount ($212,765.37) and interest ($40,070.46). The consequence of these orders, when made, will be that Mr Vella will have the benefit of two judgments against Mr El-Hanania, one being the judgment entered in the District Court on 31 May 2018, and the judgment that will be entered on the basis of these reasons. Given both judgments relate to the same underlying liability, however, the rule against double recovery will apply to them.[18]
17 As for the rule against double recovery, see Baxter v Obacelo Pty Ltd [2001] HCA 66; (2001) 205 CLR 635
As for costs, I propose to order that each party bear his own costs, other than the costs I ordered Mr El-Hanania pay on 3 October 2019.[19] Both parties had a measure of success. Mr El-Hanania succeeded in his application to set aside the bankruptcy notice. Mr Vella, on the other hand, succeeded in resisting Mr El-Hanania’s application under the slip rule to amend the Registrar’s orders made on 27 November 2018;[20] and he has succeeded in his claim for judgment for the Agreed Amount together with interest.
18 El-Hanania v Vella (No.2) [2019] FCCA 2907
19 El-Hanania v Vella [2019] FCCA 1555
I certify that the preceding thirty-four (34) paragraphs are a true copy of the reasons for judgment of Judge Manousaridis
Date: 14 February 2020
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