Gigi Entertainment Pty Limited v Schmidt - [2010] NSWSC 906

CITATION: GIGI ENTERTAINMENT PTY LIMITED v SCHMIDT [2010] NSWSC 906

HEARING DATE(S): Wednesday 11 August 2010

JUDGMENT DATE :
16 August 2010

JURISDICTION: Common Law

JUDGMENT OF: Hall J at 1

DECISION: (1)That the report of Dr John M Hutcheson, Referee, dated 28 April 2010 be rejected insofar as it expresses an opinion as to the costs of rectifying any of the following items referred to in the Scott Schedule dated 6 May 2008:-
(a) item 8;
(b) items 32, 34, 49, 120 and 150;
(c) items 5, 39, 102, 108 and 109.
(2) That the following parts of the Referee’s report be rejected:-
(a) paragraphs 5(e), 64 to 66, 79(a)(i) and the row labelled “Supervisor for the Plaintiff” in the table behind Tab 3 (“Supervisor for the Plaintiff”);
(b) paragraphs 5(f), 46 to 48, 79(a)(ii) and the row labelled “Referee – 5.5% Reserve” in the table behind Tab 3 (“reserve for unknowns”);
(c) paragraphs 5(c), 58 to 60, 79(a)(iii), item 156 of Tab 2, Item 156 of Tab 3 (“preliminaries”).
(d) paragraphs 5(d), 61 to 63, 79(a)(iv), item 158 of Tab 2, item 158 of Tab 3 (“OH&P”).
(3) That, subject to order (4) of these order, the Referee’s report otherwise be adopted.
(4) These orders are without prejudice to the defendant’s right to make contentions at trial regarding any question of law arising in the proceedings (including any question relating to the proper construction of any document) whether or not that question was inquired into or reported on by the Referee.
(5) That the plaintiff’s notice of motion filed on 8 June 2010 be dismissed with costs.
(6) That the plaintiff pay the defendant’s costs of, and incidental to, the hearing on 11 August 2010.
(7) That the costs of the reference before the Referee be reserved.

CATCHWORDS: REFERENCE TO REFEREE – under Court order UCPR Part 20.14(1) – application by a party to proceedings opposing adoption of Referee’s report on certain matters – PROCEDURAL FAIRNESS – whether Referee utilised a report of an expert the parties had agreed would not be relied upon for purposes of the proceedings – the report, in breach of procedural fairness requirements, had been used as a “check” on cost of work – obligation of Referee to “determine” quantum of liability of lessee under a repair and maintenance provision – requires more than selecting or preferring one expert’s assessment over another – determining quantum requires examination and analysis of basis of relevant material – “quantum” refers to an amount of money payable in damages – not determining maximum allowances for items of work and does not permit indeterminate allowances being made for items of work such as unquantified provisional sums – duty to give reasons – a Referee must identify the basis for or provide an explanation for a particular allowance or assessment of loss and not merely prefer one expert assessment over another

CASES CITED: Strabak v Newton (Court of Appeal, unreported 18 July 1989 per Samuels JA)
Xuereb v Viola…

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.

Keep reading for free

Create a free CaseChat account to read Gigi Entertainment Pty Limited v Schmidt and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2010] NSWSC 906
Decision Date: 16 August 2010

CaseChat Overview and Summary

In the case of Gigi Entertainment Pty Limited v Schmidt, the dispute centred on the interpretation and application of a repair and maintenance provision within a lease agreement. The matter was heard in the Supreme Court of New South Wales. The primary issue before the court was whether the Referee, who had been appointed to determine the quantum of liability under the lease, had breached procedural fairness by using an expert's report that the parties had expressly agreed would not be relied upon in the proceedings.

The court had to decide if the Referee's use of the report, even as a "check" on the costs of work, constituted a breach of procedural fairness. Furthermore, the court needed to determine the scope of the Referee's obligation to "determine" the quantum of liability. The court clarified that determining the quantum required more than merely selecting or preferring one expert's assessment over another; it necessitated an examination and analysis of the basis of relevant material. The court also addressed whether the term "quantum" referred to an amount of money payable in damages, and whether it allowed for indeterminate allowances for items of work, such as unquantified provisional sums.

The Supreme Court found that the Referee had indeed breached procedural fairness by utilising the agreed-upon excluded report. The court held that determining the quantum of liability under the lease required more than merely choosing one expert's assessment over another. Instead, it demanded a thorough examination and analysis of the basis of the relevant material. The court emphasised the importance of the Referee providing reasons for any particular allowance or assessment of loss, rather than simply preferring one expert's assessment. The court's decision underscored the necessity for a Referee to adhere strictly to procedural fairness and to clearly explain the basis for their determinations.

The final orders of the court included a direction for the Referee to re-evaluate the quantum of liability, ensuring compliance with procedural fairness and a proper examination of the basis for any allowances or assessments of loss. The court also reiterated the importance of providing clear reasons for any determinations made.

Orders