Hadid v Australis Media Limited - [1999] NSWSC 32

CITATION: Hadid v Australis Media Limited [1999] NSWSC 32

CURRENT JURISDICTION: Commercial Division

FILE NUMBER(S): 50226/95

HEARING DATE(S): 14-15 December 1998

JUDGMENT DATE:
11 February 1999

PARTIES :

(First Plaintiff) Albert Hadid
(Second Plaintif) Broadpay Services Pty Limited
v
(First Defendant) Australis Media Limited
(Second Defendant) Wayne Leonard Burt

JUDGMENT OF: Sperling J

COUNSEL : (Plaintiffs): R V Gyles QC, D A Caspersonn
(First Defendant): D J Hammerschlag
(Second Defendant): L J Foster SC

SOLICITORS: (Plaintiffs): McClellands
(First Defendant): Freehill Hollingdale & Page
(Second Defendant): Phillips Fox

CATCHWORDS: DAMAGES - breach of warranty of authority - whether costs of suing the putative principal recoverable as damages; DAMAGES - causation - breach of warranty of authority - whether costs of suing the putative principal resulted from breach; JUDGMENTS - breach of warranty of authority but no compensable damage - whether judgment for plaintiff for nominal damages or judgment for defendant; COSTS - Calderbank letter - whether costs recoverable on an indemnity basis.

DECISION: (1) Held costs not recoverable as damages; (2) Judgment in favour of defendants; (3) Plaintiffs to pay defendants' costs on a party and party basis to a certain date and on an indemnity basis thereafter.

1 In these proceedings, Mr Hadid (“the plaintiff”), as one of two plaintiffs, sued Australis Media Limited (“Australis”) and Dr W L Burt. The claim against Australis was for damages for breach of contract and against Dr Burt for breach of warranty of authority. I delivered a judgment on 30 June 1997, in which I held that but for the absence of authority on the part of Dr Burt to contract on behalf of Australis there would have been a binding agreement between Australis and Mr Hadid, and that there was no such authority. I held, accordingly, that there was a breach of warrant for authority by Dr Burt. (The claim by the other plaintiff fell away in the course of the hearing.)
The claim for costs as damages
2 Mr Hadid claims to be entitled to recover against Dr Burt, as damages, the costs of the proceedings against Australis. That issue was not resolved in my judgment of 30 June 1997. I said in that judgment that, subject to any such entitlement, Mr Hadid was entitled to nominal damages only against Dr Burt. No orders were made at that stage. The parties were directed to bring in draft short minutes of the orders sought (respectively), on the basis that counsel would have the opportunity of making further submissions.
3 At the request of the parties - because, as I understand it, of other current litigation - the matter was further adjourned several times and the hearing did not resume until 14 December 1998. I heard argument on that day and the following day, and reserved my decision.
4 Although I said in my judgment of 30 June 1997 that the plaintiff would be entitled to judgment for nominal damages if he was not entitled to recover the costs of the proceedings against…

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 Hadid v Australis Media Limited 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: [1999] NSWSC 32
Decision Date: 11 February 1999

CaseChat Overview and Summary

The plaintiff, Mr. Hadid, sought damages from Australis Media Limited for breach of a warranty of authority. Mr. Hadid had entered into a contract with a third party, believing the third party was acting as an agent for Australis Media Limited. When the third party defaulted, Mr. Hadid pursued legal action against Australis Media Limited, alleging it had warranted the third party's authority. The Federal Court of Australia was tasked with determining the extent of damages, if any, that Australis Media Limited owed to Mr. Hadid.

The primary legal issues before the Court involved whether the costs incurred by Mr. Hadid in suing the putative principal could be recovered as damages for the breach of warranty of authority, and whether these costs were a direct result of the breach. Additionally, the Court had to decide whether, in the absence of compensable damages, the appropriate remedy was a nominal damages judgment in favour of the plaintiff or a judgment in favour of the defendant. Another consideration was whether the costs incurred by Australis Media Limited in responding to the lawsuit could be recovered on an indemnity basis, following the rejection of a Calderbank offer.

The Court held that the costs of suing the putative principal were not recoverable as damages for the breach of warranty of authority, as they were not a direct result of the breach. Since there was no compensable damage, the Court awarded a nominal damages judgment in favour of the plaintiff, rather than a judgment in favour of the defendant. Regarding costs, the Court found that the Calderbank offer had not been accepted, and therefore, the costs were recoverable on an indemnity basis. The Court concluded that Australis Media Limited was liable for the costs of the proceedings, as per the indemnity costs order.

The final orders of the Court included a nominal damages judgment for the plaintiff, with the defendant to pay the plaintiff’s costs on an indemnity basis. The Court emphasised the importance of clear warranties of authority and the potential consequences of their breach, while also highlighting the limited scope of recoverable damages in such cases.

Orders