Bathurst CJ at [1]; McColl JA at [6]; Barrett JA at [7]
Decision:
1. Appeal allowed in part.
2. Set aside order (4) made in the Equity Division on 3 September 2013 and in lieu thereof make orders (4) and (4A) as follows:
"(4). Give judgment that the first cross-defendant David Richard Hawes and the second cross-defendant Glenside Group Pty Ltd pay the first cross-claimant Trevor Laurence Dean the sum of $357,188. (inclusive of interest to 14 August 2013), this judgment to take effect on 14 August 2013.
(4A) Give judgment that the second defendant Dean Investments Pty Ltd pay the second plaintiff Hawes Investments Pty Ltd the sum of $321,386.01 (inclusive of interest to 14 August 2013), this judgment to take effect on 14 August 2013."
3. Cross-appeal dismissed.
4. That the appellants pay two-thirds of the respondents' costs of the appeal.
5. That the respondents pay one-third of the appellants' costs of the appeal.
6. That the cross appellant pay the cross respondents' costs of the cross-appeal.
Catchwords:
CONTRACTS - general contractual principles - construction and interpretation of contracts - construing a commercial contract in its context - no matter of principle - PROCEDURE - set-off - equitable set-off - entitlement to money judgments established by one party against another party and by an associated entity of the second against an associated entity of the first - whether primary judge correctly allowed equitable set-off - need for one right to impeach the other - whether rights and their sources so closely connected that equitable set-off should be ordered - lack of mutuality and separateness of sources held to be such as not to permit set-off - COSTS - challenges to aspects of costs orders at first instance - no matter of principle
[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.
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AGLC
Hawes v Dean [2014] NSWCA 380
Case
[2014] NSWCA 380
Decision Date
CaseChat Overview and Summary
The dispute in *Hawes v Dean* concerned contractual entitlements and the application of equitable set-off. The parties involved were David Richard Hawes and Glenside Group Pty Ltd (appellants/cross-defendants), Trevor Laurence Dean (respondent/first cross-claimant), Dean Investments Pty Ltd (second defendant), and Hawes Investments Pty Ltd (second plaintiff). The case came before the New South Wales Court of Appeal, comprising Bathurst CJ, McColl and Barrett JJA.
The primary legal issues before the Court of Appeal were whether the primary judge had correctly allowed an equitable set-off between money judgments obtained by one party against another and by an associated entity of the second against an associated entity of the first. This involved determining whether the rights and their sources were sufficiently closely connected to permit equitable set-off, particularly in circumstances where there was a lack of mutuality and separateness of the sources of those rights. The court also considered challenges to aspects of costs orders made at first instance.
The Court of Appeal found that the primary judge had erred in allowing the equitable set-off. The court reasoned that for equitable set-off to be permitted, there needed to be a sufficient connection between the rights and their sources, and a lack of mutuality and the separateness of the sources of the rights in this case precluded such a set-off. The court allowed the appeal in part, setting aside the order for equitable set-off and substituting it with separate judgments for the amounts owed between the respective parties and their associated entities. The cross-appeal was dismissed.
Orders
Orders of the court
1. Appeal allowed in part.
2. Set aside order (4) made in the Equity Division on 3 September 2013 and in lieu thereof make orders (4) and (4A) as follows:
"(4). Give judgment that the first cross-defendant David Richard Hawes and the second cross-defendant Glenside Group Pty Ltd pay the first cross-claimant Trevor Laurence Dean the sum of $357,188. (inclusive of interest to 14 August 2013), this judgment to take effect on 14 August 2013.
(4A) Give judgment that the second defendant Dean Investments Pty Ltd pay the second plaintiff Hawes Investments Pty Ltd the sum of $321,386.01 (inclusive of interest to 14 August 2013), this judgment to take effect on 14 August 2013."
3. Cross-appeal dismissed.
4. That the appellants pay two-thirds of the respondents' costs of the appeal.
5. That the respondents pay one-third of the appellants' costs of the appeal.
6. That the cross appellant pay the cross respondents' costs of the cross-appeal.