Ikosidekas v Glenis - [2023] VSCA 134

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2022 0056

PETER IKOSIDEKAS	Applicant
v
JERRY GLENIS	Respondent

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JUDGES:	BEACH, NIALL and HARGRAVE JJA
WHERE HELD:	Melbourne
DATE OF HEARING:	21 April 2023
DATE OF JUDGMENT:	7 June 2023
MEDIUM NEUTRAL CITATION:	[2023] VSCA 134
JUDGMENT APPEALED FROM:	Ikosidekas v MWL Finance Pty Ltd [2022] VCC 633 (Judge Burchell)

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INTEREST – Supreme Court Act 1986 (the ‘Act’) ss 58, 60 – Claim against three defendants for $160,000 plus statutory interest – Plaintiff settled with two defendants who paid principal sum of $160,000 in full settlement of all claims – Plaintiff proceeded to trial against remaining defendant for interest and exemplary damages – Whether interest entitlement under ss 58 or 60 of the Act to the date of payment of the principal sum should be calculated before deducting principal sum from plaintiff’s damages entitlement – Held: (1) interest entitlement to date of payment of principal sum formed part of damages entitlement; (2) principal sum to be deducted from total damages; (3) plaintiff entitled to judgment for amount of accrued interest at date principal sum paid; (4) plaintiff entitled to exemplary damages consequent on order for compensatory damages – Appeal allowed.

Williams v Volta [1982] VR 739, 746, 757; A J Lucas Drilling Pty Ltd v McConnell Dowell Constructors (Aust) Pty Ltd [2009] VSCA 310; Carbone v Melton City Council (2020) 60 VR 539; [2020] VSCA 117, applied.

INTEREST – Section 58(1) of the Act – Fictitious loan procured by fraudster – Demand for repayment from fictious borrower – Fraudster received demand – Whether a demand for purposes of s 58(1) of the Act – Held: demand from fictitious borrower was in circumstances a demand from fraudster – Interest under s 58(1) awarded – Appeal allowed.

A J Lucas Drilling Pty Ltd v McConnell Dowell Constructors (Aust) Pty Ltd [2009] VSCA 310, [171].

DAMAGES – Plaintiff claimed same damage from three defendants – Plaintiff received settlement sum from two defendants for part of claimed amounts – Remaining defendant held liable for greater amount – Whether plaintiff’s claim for costs against defendants who settled was a concurrent claim – Whether claim for costs against defendants who settled required to be taken into account in assessing plaintiff’s damages entitlement – Onus of proof – No evidence of amount of costs incurred in pursuing defendants who settled – Full amount of settlement sum credited to plaintiff’s damages entitlement.

Banque Keyser Ullman SA v Skandia (UK) Insurance Co Ltd (No 2) [1988] 2 All ER 880; Townsend v Stone Toms & Partners (a firm) (1984) 27 BLR 26; Boncristiano v Lohmann [1998] 4 VR 82, considered and applied.

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Counsel
Applicant:		Mr AC Blair
Respondent:		Mr J Lipinski
Solicitors
Applicant:	Klonis Kirby & Co
Respondent:	Stenta Legal

TABLE OF CONTENTS

Grounds of appeal

Should the judge have put Ikosidekas to his election between alternative remedies?

Was Ikosidekas entitled to statutory interest?

Should an amount for legal costs have been…

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.

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Details

Case: [2023] VSCA 134
Decision Date: 7 June 2023

CaseChat Overview and Summary

In the case of Ikosidekas v Glenis, the plaintiff sought $160,000 plus statutory interest from three defendants. After settling with two of the defendants, who paid the principal sum in full, the plaintiff proceeded to trial against the remaining defendant for interest and exemplary damages. The central legal issues involved determining whether the interest entitlement under sections 58 or 60 of the Supreme Court Act 1986 should be calculated before deducting the principal sum from the plaintiff's overall damages entitlement. The court had to consider whether the demand from a fictitious borrower constituted a demand for the purposes of section 58(1) of the Act, and whether the plaintiff's claim for costs against the settling defendants should be taken into account in assessing the plaintiff's damages entitlement.

The court concluded that the interest entitlement to the date of payment of the principal sum formed part of the damages entitlement, but the principal sum should be deducted from the total damages. The court found that the demand from the fictitious borrower was effectively a demand from the fraudster, thereby awarding interest under section 58(1) of the Act. The plaintiff was entitled to judgment for the amount of accrued interest at the date the principal sum was paid, and also for exemplary damages due to the order for compensatory damages. The appeal was allowed, reflecting that the court's reasoning aligned with the cited precedents.

Given the absence of evidence regarding the costs incurred in pursuing the defendants who settled, the full amount of the settlement sum was credited to the plaintiff's damages entitlement. The court applied established principles from Banque Keyser Ullman SA v Skandia (UK) Insurance Co Ltd (No 2) and Boncristiano v Lohmann to conclude that the plaintiff's concurrent claim for costs against the settling defendants did not affect the assessment of the plaintiff's damages entitlement. This decision reinforces the principle that where there is no evidence of the costs incurred, the settlement sum should be fully credited.

The final orders of the court were that the plaintiff was entitled to the accrued interest at the date the principal sum was paid and exemplary damages, with the settlement sum from the two defendants fully credited to the plaintiff's damages entitlement.

Orders