Helms Plumbing v Coulson (No. 2)
[2015] VCC 1879
•17 December 2015.
| IN THE COUNTY COURT OF VICTORIA | Revised Not Restricted Suitable for Publication |
AT MELBOURNE
COMMERCIAL DIVISION
GENERAL CASES LIST
Case No. CI-14-02123
| HELMS PLUMBING PTY LTD | Plaintiff |
| v | |
| KEITH EDWARD COULSON and GLENIS HELEN COULSON | First Defendant Second Defendant |
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JUDGE: | HIS HONOUR JUDGE COSGRAVE | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 22, 23, 24 July, 27, 28, 29, 30 July, 3, 4 August, and 4 December 2015 (final written submissions received 11 December 2015) | |
DATE OF JUDGMENT: | 17 December 2015. | |
CASE MAY BE CITED AS: | HELMS PLUMBING V COULSON & ANOR (No. 2) | |
MEDIUM NEUTRAL CITATION: | [2015] VCC 1879 | |
REASONS FOR JUDGMENT
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Subject: PRACTICE AND PROCEDURE; COSTS
Catchwords: PRACTICE AND PROCEDURE – amendment of reasons – whether court can amend reasons for judgment before final orders – whether could should exercise discretion to amend reasons – slip rule
COSTS – whether plaintiff entitled to costs on an indemnity basis – whether plaintiff acted unreasonably in rejecting pre-litigation offer – whether court should order costs in accordance with agreements between the parties – whether court should discount any costs order for partial success by defendants
Cases Cited:BHP Billiton Olympic Dam Corporation Pty Ltd v Steuler Industriewerke GmbH (No 3) [2012] VSC 414; Fletcher Construction Australia Ltd v Lines MacFarlane & Marshall Pty Ltd (2001) 4 VR 28; GT Corporation Pty Ltd v Amare Safety Pty Ltd [2008] VSC 296; Latoudis v Casey (1990) 170 CLR 534; Norbis v Norbis (1986) 161 CLR 513; Oshlack v Richmond River Council (1998) 193 CLR 72; Sherpa v Anderson (Unreported, Supreme Court of New South Wales, Young J, 14 October 1993); Whild v GE Mortgage Solutions Ltd (No 2) [2012] VSC 322.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr D McAloon | Meerkin & Apel |
| For the Defendant | Mr J Mattin Mr H Forrester | Robertson Legal |
HIS HONOUR:
1 I handed down reasons for judgment in this matter on 13 November 2015 so that the parties could consider them before making submissions on the final orders to be made and costs. At that time, I ordered the parties to file and serve outlines of submissions and affidavit material upon which they sought to rely in relation to the issues of final orders and costs. I adjourned the matter for further hearing to 4 December 2015.
2 These reasons should be read in conjunction with the earlier reasons. I adopt here the same terminology and defined terms as appeared in the earlier reasons.
3 On 4 December 2015, the plaintiff submitted that there was a problem with an aspect of the reasons handed down on 13 November 2015 and that I should amend the reasons to remedy the problem before making final orders.
4 The plaintiff’s submissions concerned the amounts said to be owing under the defendants’ counterclaim which were set-off against the judgment amount.
5 In the reasons, I found that the amount of $290,537.42 owed by the defendants to Helms was reduced by the sum of $80,000 for amounts owing by Helms to the defendants under the alleged joint venture agreement and sub-contracting jobs. I also found that, in respect of these jobs, the first defendant owed the plaintiff the sum of $30,000. However, at [164] I found that this amount was not recoverable by Helms as Helms “made no relevant claim such as an alleged breach of contract or quantum meruit”.
6 The plaintiff contended in substance that:
(a) at paragraphs [127]-[128] of the reasons, the sum of $80,000 is said to be owing by Helms to Dancol. As Dancol is in liquidation and is not a party to the proceedings, the plaintiff contends that if the amount is owing to Dancol, it ought not be recoverable by the defendants; and/ or
(b) if the amount of $30,000 is owing by the defendants to Coulson, it should be captured by the August Charge executed by both defendants and/or the December Charge executed by Coulson alone. Ex hypothesi, it is not necessary for Helms to seek to separately recover it via a claim based on a breach of contract of quantum meruit.
7 As a result, the plaintiff submits that the court should amend its reasons so that:
(a) if the sums of $80,000 and $30,000 are owed to and by Dancol respectively, no party should be entitled to set-off the claim as Dancol is not a party to the proceedings; or
(b) Helms is entitled to recover the amount of $30,000 from one or both defendants on the basis that this indebtedness was acknowledged and is comprised in the amounts said to be owing pursuant to the August Charge and December Charge respectively.
8 For their part, the defendants contended that the reasons raised no issues, and that the court should not amend or vary the reasons. Counsel for the defendants submitted that I was unable to amend my reasons once published and that the only option available for an aggrieved party is to appeal the decision.
9 The issues to address are:
(a) whether the court has the power to amend or revise the reasons; and
(b) if so, should it exercise the power in this case?
Does the court have the power to amend its reasons?
10 The case law makes clear that there is an important difference between a situation in which a judgment in the form of a court order has been finalised and authenticated and one in which that process has yet to be completed. In Fletcher Construction Australia Ltd v Lines MacFarlane & Marshall Pty Ltd,[1] the Victorian Court of Appeal said that the extent to which the court can alter reasons for judgment after they have been given can depend not only on whether the changes are sought to be made before or after the judgment has been entered, but also upon the nature and extent of the alterations. For sound reasons of policy, judges cannot make wholesale changes to their reasons after judgment has been handed down. But there is some scope to act in a manner consistent with the practical requirements of justice. Generally, a judgment is not relevantly finalised until it is entered in the records of the court. Until there is an authenticated order made and entered, the judge can recall the order and reasons and make a different order based on different reasons.[2] However, once the court has authenticated the order giving effect to the decision made, any correction can usually be made only by the Court of Appeal.
[1](2001) 4 VR 28.
[2]Ibid at [49] and the cases cited therein.
11 As Young J put it in Sherpa v Anderson:[3]
“… there is a great distinction between what occurs after a judgment is formally entered in the court record and what happens before that moment. Even after a judge has given his or her reasons for decision, the reasons may be reviewed and withdrawn if the order consequent upon the reasons has not been entered. Once the formal judgment has been entered, then apart from certain exceptional cases … , the judgment can only be amended if there is statutory authority for that amendment.”
[3]Unreported, Supreme Court of New South Wales, Young J, 14 October 1993 at 5.
12 Section 73 of the County Court Act 1958 (Vic) deals with the finality of judgments. In the commentary to this section, Williams’ Supreme Court Practice states:[4]
“A judgment or order of a court of compentent jurisdiction is binding upon the parties and must be obeyed. As a general rule, once a judgment or an order of the court has been authenticated, that is, perfected by being drawn up as the record of the court in the form which correctly expresses the intention with which it was made, the court has no jurisdiction to review, vary, or set it aside. A judgment or order to which objection is made on the ground that it was given or made in error can only be varied or set aside on appeal … in the County Court an appeal lies to the Court of Appeal in accordance with section 74. However, in the County Court (as in the Supreme Court) the court may in the exercise of its inherent jurisdiction or under rule 36.07 of the County Court Civil Procedure Rules 2008 amend a judgment or order which has been authenticated to correct a clerical mistake or error arising from an accidental slip or omission. This may be done in the proceeding in which the judgment was given or the order made.”
[4]Williams Supreme Court Practice at [1871.0]
13 The present case concerns a situation in which no orders have yet been formulated and there is no authenticated order. Accordingly, I consider that there is power to amend the reasons previously published to take account of the issues raised by Helms.
Should the court exercise its power to amend reasons?
14 In its outline of submissions dated 2 December 2015, the plaintiff contended that the court should amend the reasons. The plaintiff submitted that the position as stated in paragraph 7(b) above was correct and that, accordingly, Helms is entitled to judgment in the sum of $240,537.42, comprising the further amount of $30,000 said to be owing by the Coulsons to Helms.
15 On 10 December 2015, the court emailed counsel for the plaintiff requesting a written memorandum explaining why the plaintiff contended that paragraph 7(b) is “correct”.[5]
[5]Also copying in counsel for the defendants, consistently with the court’s policy of communicating with parties to litigation.
16 By written memorandum dated 11 December 2015, the plaintiff submitted that the terms of the August Charge and/or the December should incorporate any indebtedness by Mr and Mrs Coulson, or Coulson alone, to Helms with respect to the joint jobs. In support of its submission, the plaintiff pointed to the following relevant factors:
(a) Recital B of the August Charge and December Charge records that Helms has “advanced funds to us, has waived financial entitlements and has incurred substantial costs”.
(b) the August Charge estimated the indebtedness secured by its execution as “$350,000 or thereabouts”, and the December Charge revised this estimate up to $436,985.09 plus interest. The plaintiff submits that amounts of this magnitude could only have been acknowledged if the defendant intended to include indebtedness arising out of the joint jobs. This is particularly so in circumstances where the amounts paid under the March Agreement totalled only $216,776.94.
(c) the December Charge was executed by Coulson after he was shown all the costings and amounts said to be owed by Coulson to Helms. The plaintiff contends that the parties intended for the August and December Charge to include the liability of Coulson for amounts owing under the joint jobs.
(d) the August Charge and/or December Charge was found to comprise other amounts owing by Coulson or the Coulsons to Helms, including interest charges[6] and the $5,000 loan to Coulson in about February 2012.[7] The plaintiff submits that there is no logical reason why the indebtedness with respect to the joint jobs should not also be captured by the August and/or December Charge.
[6]Reasons, [152].
[7]Reasons, [137].
17 It was seemingly not in dispute that the joint jobs were an arrangement between Helms and Coulson. The defendants’ counterclaim[8] alleges that the joint venture agreement was between the first defendant and the plaintiff and the trial was conducted on this basis.[9] The joint venture agreement was for the purpose of acquiring and operating the business then undertaken by Dancol. At the time of the alleged agreement in March 2012, Dancol was already in administration. I am satisfied that the reference to “Dancol” in paragraphs 127 and 128 of my reasons was a slip and should have referred to “Coulson”.
[8]CB36.
[9]Helms could not recover in this action money owing by Dancol: Dancol is not a party and, in any case, because it has now been wound up, Helms would require leave to proceed.
18 The language of the August Charge makes plain that the defendants are providing security in respect of:
“…all monies advanced by the Lender and also otherwise payable by us pursuant to or in respect of the Agreement and this Deed which are presently estimated at $350,000 or thereabouts”.
The December Charge is in like terms giving security in respect of:
“…all monies advanced by the Lender and also otherwise payable by us to or in respect of the Agreement and this Deed which are presently estimated at (sic) as of 3/12/2012 Keith and Glenis Coulson owe Helms … the sum of $436,955.98 …”.
19 In my earlier judgment I found that the August Charge provided security for various moneys advanced for or on behalf of the Coulsons, including the money paid to McDermott and the National Australia Bank, the $5,000 lent to Coulson in February 2012 to help keep Dancol out of liquidation and the amount of $63,308 guaranteed by the Coulsons. Helms argued that:
(a) the joint jobs undertaken by Helms and Coulson were:
(i) undertaken before the August Charge was executed;
(ii) contemplated by the March Agreement;
(b) any indebtedness of the Coulsons in connection with the joint jobs was an indebtedness which the Coulsons had to pay “pursuant to or in respect of the Agreement and the Deed” – in the same way as Coulson had to repay the $5,000 loan
Hence, Helms contended in effect that, to the extent that the judgment included one item but not another, there was an inconsistency of approach.
20 Having reflected further on Helms’ contentions, I accept there was an inconsistency. As noted, both parties accepted that they worked together collaboratively on a number of projects using staff and resources of Helms and assets controlled by Coulson’s company.[10] The ultimate aim, which they discussed, was the sale to Helms of some or all of the assets and business of Dancol. Accordingly, I agree that, even though Helms made no express claims, for example, a breach of contract or quantum meruit, the moneys owing through the joint jobs were nonetheless covered under the terms of the security and should be taken into account. The words “pursuant to or in respect of” are words of substantial breadth. The nett result is to increase the debt owing to Helms by $30,000. I thus find that the defendants owe Helms the sum of $240,537.42.
[10]See, for example, paragraph 19 of the Reply and the basis on which they conducted the trial.
Costs
21 The plaintiff submitted that because it was successful in the proceeding, the usual costs order should apply – namely, that the defendants pay the plaintiff’s costs of the proceeding. Further, the plaintiff contends that the court should consider the terms of any agreements between the parties in exercising its discretion. Helms relies on the terms of March Agreement and of the MCP expressly incorporated into the Dover Court mortgage and the Whittlesea mortgages.
22 Clause 5 of the March Agreement states:
“Each party shall bear and pay its own legal and other costs of carrying out all of its respective obligations under this agreement save and except that the Borrowers shall pay the Lender’s costs of the preparation, execution and registration of the mortgage to the Lender and of this agreement on a full indemnity basis.”
The plaintiff submits that it is entitled to the costs of preparing, executing and registering the Dover Court and Whittlesea mortgages on a full indemnity basis.
23 Clause 39.1 of the MCP states:
“You must pay us on demand all reasonable enforcement expenses that we or a receiver or an attorney reasonably incur in enforcing or exercising rights after a breach of the mortgage occurs.”
Helms refers to the decision of Croft J in Whild v GE Mortgage Solutions Ltd (No 2)[11] in which His Honour considered a clause in substantially the same terms as clause 39.1. His Honour found that, although the clause intended a party to recover costs on a higher basis than party and party costs, the reference to costs being ‘reasonably’ incurred limited the recovery enjoyed by the mortgagee.
[11][2012] VSC 322.
24 As the court rules from 6 October 2014 no longer provide for taxation of costs on a solicitor and client basis, the plaintiff seeks its costs of the proceeding on a solicitor and client basis until that date, and on a standard basis thereafter.
25 Helms also drew the court’s attention to the fact that the Coulsons either failed to prove or abandoned various defences and had their counterclaim dismissed.
26 For their part, the defendants rely upon a pre-litigation offer of compromise sent to the plaintiff’s solicitor on 3 October 2013. That letter contained, inter alia, the following elements:
· the Dover Court property would be immediately placed on the market for sale.
· the offer to settle the dispute was $348,308, being an amount of $285,000 plus an additional sum of $63,308. This was said to represent a good offer.
· the payment of the $348,308 would occur upon settlement of the Dover Court property.
· the Coulsons intended both to defend any prospective proceedings and to counterclaim. The counterclaim was said to concern amounts which Helms did not pay to the Coulsons under the alleged joint venture agreement between the parties.
27 The defendants contend that the plaintiff acted unreasonably in rejecting that offer, and as a result, the appropriate order is that the plaintiff’s pay the defendants costs on an indemnity basis.
28 Alternatively, the defendants submit that if the court were to find that Helms was not unreasonable in rejecting the pre-litigation offer, the defendants ought not be ordered to pay the plaintiff’s costs on an indemnity basis as they were partly successful in their claim. To this end, they submit that they should be entitled to a reduction on any adverse costs order.
Legal principles
29 The court’s discretion in relation to costs is unfettered.[12] The court has the power to order costs on a standard basis, indemnity basis or any other basis as the court directs.[13] The discretion has to be exercised judicially and by reference to relevant considerations.[14] Over time, common practices or guidelines have developed in the exercise of the discretion[15] but the discretion remains absolute.[16] The purpose of an order for costs is to indemnify or compensate the party in whose favour it is made and not to punish the unsuccessful party.
[12]Latoudis v Casey (1990) 170 CLR 534, 537 cited with approval in Oshlack v Richmond River Council (1998) 193 CLR 72 at [34].
[13]County Court Civil Procedure Rules 2008, rule 63A.28
[14]Ibid.
[15]Oshlack v Richmond River Council (1998) 193 CLR 72 at [35].
[16]Ibid; Norbis v Norbis (1986) 161 CLR 513, 537.
30 There is a long established practice that, in the absence of good reason to the contrary, a successful party should receive its costs.[17] An offer of compromise[18] or a Calderbank letter, along with their subsequent rejection are but two, albeit important, circumstances to which the court may have regard in the exercise of its discretion.[19]
[17]Ritter v Godfrey [1920] 2 KB 47, 52.
[18]In accordance with O 26 of the County Court Civil Procedure Rules 2008.
[19]BHP Billiton Olympic Dam Corporation Pty Ltd v Steuler Industriewerke GmbH (No 3) [2012] VSC 414 at [59].
31 The judgment of Robson J in GT Corporation Pty Ltd v Amare Safety Pty Ltd[20] provides a comprehensive and useful summary of principles regarding costs generally and in particular where one party seeks to rely on the failures of another.
[20][2008] VSC 296 at [59].
32 The question of costs raises three issues:
(a) how effective is the Coulsons’ pre-litigation offer under rule 26.08.1?
(b) should Helms recover costs from the Coulsons in accordance with their agreement and the security held?
(c) should there be any recognition of the reduction in debt owing to Helms?
How effective is the Coulsons’ pre-litigation offer under rule 26.08.1?
33 Rule 26.08.1 of the County Court Civil Procedure Rules 2008 came into force on 7 October 2013. That rule is in the following terms:
“(1) If –
(a)a party, before a proceeding has commenced, has made an offer in writing to another party (whether or not expressed to be without prejudice) to compromise any claim made in the proceeding on the terms specified in the offer;
(b)the offer was open to be accepted for a reasonable time, but was not accepted; and
(c)the offeror obtains an order or judgment in respect of the claim no less favourable to the offeror than the terms of the offer –
the Court shall take those matters into account in determining what order for costs to make in respect of the costs proceeding.”
Because the offer was open, and subsequently rejected, at a time when this rule was in effect, I consider that I can take notice of the pre-litigation offer dated 3 October 2013.
34 In BHP Billiton Olympic Dam Corporation Pty Ltd v Steuler Industriewerke GmbH (No 3),[21] Habersberger J summarised the principles relevant in exercising the court’s discretion as follows:[22]
[21][2012] VSC 414.
[22]Ibid at [59]-[64].
“First, the fact that a less favourable result is achieved does not give rise to a presumption of a special costs order. The making of an offer and its rejection are “but two albeit important circumstances” to which the court will have regard in the exercise of its costs discretion.
Secondly, the competing policy objectives relevant to the exercise of the costs discretion are principally the desirability of promoting settlement and reducing litigation costs as against the undesirability of discouraging potential litigants from bringing their dispute to the courts.
Thirdly, the critical question is whether the rejection of the offer was unreasonable in the circumstances. As the Court of Appeal said in Hazeldene:
“In our view, these competing considerations can be sufficiently accommodated by applying a test of (un)reasonableness. The critical question is whether the rejection of the offer was unreasonable in the circumstances. We see no justification for a more stringent test such as “manifestly” or “plainly” unreasonable.”
Fourthly, a court considering submissions that the rejection of a Calderbank offer was unreasonable should ordinarily have regard at least to the following matters:
(a) the stage of the proceeding at which the offer was received;
(b) the time allowed for the offeree to consider the offer;
(c) the extent of the compromise offered;
(d)the offeree’s prospects of success, assessed as at the date of the offer;
(e) the clarity with which the terms of the offer were expressed; and
(f)whether the offer foreshadowed an application for indemnity costs in the event of the offeree rejecting it.
Fifthly, as the determination of whether it was unreasonable for the offeree to have rejected the offer is made “as at the time, or within a reasonably short time after, the offer” was made, the court should not too readily embrace submissions that it was inevitable that the proceedings would fail. As Hamilton J put it in Grynberg v Muller:
“These submissions focus the bright light of hindsight. Hindsight sings a siren song of which Judges must be cautious …”
Sixthly, the onus lies on the offeror to demonstrate the unreasonableness of the offeree’s rejection of the offer. This means that it is necessary to analyse what was proposed.”
35 In considering whether the plaintiff acted unreasonably in rejecting the defendants’ pre-litigation offer dated 3 October 2014, I have determined the following matters as relevant:
· As at 3 October 2013, Helms had the benefit of:
o the March Agreement;
o the August Charge acknowledging an indebtedness by the defendants to the plaintiff in the sum of $350,000 or thereabouts;
o the December Charge acknowledging an indebtedness by Coulson to the plaintiff in the sum of $436,455.89;
o the Dover Court mortgage securing an amount of $285,000;
o a mortgage over 12 and 14 St Rafael Place, Whittlesea, securing an amount of $200,000; and
o a mortgage over 22 St Rafael Place, Whittlesea, securing an amount of $50,000.
· The quantum of the claim, even after trial and the publishing of my reasons on 13 November 2015, remained undetermined. A precise quantification of the claim, particularly one well below what Helms appeared entitled to on the face of the mortgage documents, would have been significantly more difficult on 3 October 2013.
· The Coulsons appeared to acknowledge a prima facie indebtedness to Helms in the letter of $285,000.
· Helms was not aware of the nature of any defences to be made by the Coulsons. While the letter dated 3 October 2013 stated that the Coulsons intended to defend any foreshadowed proceedings, it did not descend into any particularity of the nature of that defence. The letter simply stated that the Coulsons intended to “raise various issues, such as the amount your client claims”.
· Helms had no detailed knowledge of any counterclaim to be made by the Coulsons. The letter stated that “our clients instruct us that your client is well aware that it has not accounted fully to them for various works undertaken, as a joint venture, which could cause your client to pay our clients’ monies after our client pays your client the $285,000”. This claim ultimately would reduce Helms’ judgment amount by $50,000. The lack of clarity surrounding the counterclaim is a factor which supports Helms’ reasonableness in rejecting the offer. Without the counterclaim, the principal judgment debt would be substantially closer to the offered amount.
· The letter dated 3 October 2013 did not expressly foreshadow that an application for indemnity costs would be made in the event of the offeree rejecting it. Except for the reference “without prejudice save as to costs”, the letter contained no warning that it was intended to be used as a Calderbank letter or some form of offer of compromise. This is not a strong point because experienced litigation solicitors recognise that the purpose of such a letter is to found an argument for the recovery of costs at a higher than usual level.
· The payment of $348,308 from the Coulsons to Helms appeared to be conditional upon the satisfactory sale of the Dover Court property. At paragraph 4, the letter states that “Our client’s instruct us … to settle this matter by paying your client ... the total being $348,308.00, upon the settlement of the 9 Dover Court, Diamond Creek Property” (sic) (emphasis added). Having regard to the language of the offer, Helms was reasonable to believe that the sale of the Dover Court property was a condition precedent to the making of an offer. Notwithstanding the terms of the letter, the defendants did not appear to be putting the Dover Court property on the market. Indeed, this failure was noted in the letter from Helms’ solicitors dated 7 November 2013 rejecting the offer. Even today the defendants have not sold and do not wish to sell the Dover Court property.
· The letter did not provide any details about the value or equity remaining in the Dover Court property. This is particularly relevant in circumstances where Helms’ mortgage over the Dover Court property was a second registered mortgage and Helms was not aware of the level of the secured indebtedness of the first mortgagee.
36 Having regard to the above, I find that Helms was not unreasonable in rejecting the pre-litigation offer of 3 October 2013.
Should Helms recover costs from the Coulsons in accordance with their agreement and the security held?
37 In Whild v GE Mortgage Solutions Ltd,[23] Croft J stated:[24]
[23](No 2) [2012] VSC 322.
[24]Ibid at [5].
“It is common ground that the terms of any agreement as to costs will inform the Court’s discretion as to the basis of taxation of costs and that the Court should ordinarily exercise its discretion in accordance with the agreement. It is clear on the authorities that whether the terms of any agreement as to costs entitle a party to more than party and party costs is ultimately a matter of construction. It is also clear that the terms of the agreement must provide in plain and unambiguous language that costs are to be paid on a special basis, otherwise costs should be awarded on a party and party basis only.”
The language of the clause considered by Croft J does not in any relevant way depart from clause upon which the plaintiff relies in this case. I have reproduced the clause, also contained in the MCP, in Whild v GE Mortgage Solutions Ltd for comparison:
“Enforcement expenses
6.6 When we ask, you must pay us the reasonable expenses we reasonably incur in enforcing this mortgage after you are in default (including in preserving and maintaining the property – such as by paying insurance, rates and taxes for the property). This applies to expenses we incur before or after taking action under 6.4”
38 His Honour considered the above clause and found that, despite the lack of an express reference to ‘solicitor and client costs’ in the relevant clause, the language of the (then) Order 63.30 supported the court finding that the mortgagee was entitled to recover its reasonable enforcement costs and expenses on a solicitor and client basis.
39 Due to the similarity between the two clauses, I consider that Whild v GE Mortgage Solutions Ltd constitutes persuasive authority to find that the plaintiff is entitled to recover its reasonable enforcement costs and expenses under the MCP on a solicitor and client basis. The new rule 63.30 modifies this to a standard basis from 6 October 2014.
40 Similarly, I consider the language contained in clause 5 of the March Agreement to be clear and unambiguous. The juxtaposition of the first part of the clause, that each party is responsible for their own costs in relation to their obligations under the agreement, only serves to reinforce this conclusion. As such, I find that the plaintiff is entitled to its costs on an indemnity basis in relation to the preparation, execution and registration of the Dover Court mortgage.
Should there be any recognition of the reduction in debt owing to Helms?
41 Although Helms has been successful to a substantial degree, the scale of success was rather less than the claim suggested. The writ claimed a debt of $574,572.69. Immediately before trial, with the advent of Blashki’s report, the debt became $352,752. After hearing extensive evidence from various witnesses, I have found that the amount owing to Helms is $240,537.42. This represents a substantial reduction in the defendants’ liability. It was not merely a procedural victory or one of negligible impact. Because of the effect which the reduction had and the time spent at trial dealing with the issue, I consider that it is appropriate to acknowledge this fact. This is best done by ordering that the Coulsons pay 85% of Helms’ costs of the litigation. This does not have operation with respect to the costs referred to in paragraph 40 above. In reaching this conclusion, I have not overlooked the defences abandoned by the Coulsons and the failure of their counterclaim. However, it was apparent from early in the trial that the Coulsons had narrowed their focus by not persisting with various defences and it is my assessment that significant time would not have been spent on those matters. In relation to the counterclaim, the conclusion adverse to the Coulsons flowed naturally from the evidence at trial and minimal time was spent on the counterclaim as a separate matter.
42 Helms is entitled to interest on the outstanding debt. The interest due is set firstly by the terms of the Dover Court mortgage and thereafter by statute.
43 I will hear the parties on the final form of orders.
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