Jainti Pty Ltd v Fraser Panorama Pty Ltd (2) - [2021] NSWSC 965

Supreme Court

New South Wales

Medium Neutral Citation: Jainti Pty Ltd v Fraser Panorama Pty Ltd (2) [2021] NSWSC 965
Hearing dates: On the papers
Decision date: 04 August 2021
Jurisdiction: Equity
Before: Ward CJ in Eq
Decision:
1. Order the second defendant to pay the plaintiffs’ costs of the proceeding as against the second defendant on the ordinary basis until 28 August 2020 and on an indemnity basis from 28 August 2020.

Catchwords:
COSTS — Costs assessment — Determination
COSTS — Party/Party — Whether should be exception to general rule that costs follow the event — Offers of compromise/Calderbank offers

Legislation Cited:
Civil Procedure Act 2005 (NSW), s 98
Uniform Civil Procedure Rules 2005 (NSW), rr 15.3, 20.26, 42.1, 42.14

Cases Cited:
Anderson Group Pty Ltd v Tynan Motors Pty Ltd (No 2) (2006) 67 NSWLR 706; [2006] NSWCA 120
Barnes v Addy (1874) LR 9 Ch App 244
Calderbank v Calderbank [1975] 3 All ER 333
Chief Commissioner of State Revenue v Platinum Investments Management Ltd (No 2) [2011] NSWCA 197
Commissioner of State Revenue v Challenger Listed Investments Ltd (No 2) [2011] VSCA 398
Commonwealth of Australia v Gretton [2008] NSWCA 117
Evans Shire Council v Richardson (No 2) [2006] NSWCA 61
Ex Parte Lai Qin (1997) 186 CLR 622; [1997] HCA 6
Favotto Family Restaurants Pty Ltd v Chief Commissioner of State Revenue (No 2) [2020] NSWSC 519
Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) (2005) 13 VR 435; [2005] VSCA 298
Herning v GWS Machinery Pty Ltd (No 2) [2005] NSWCA 375
Jainti Pty Ltd v Fraser Panorama Pty Ltd [2021] NSWSC 744
Jojeni Investments Pty Ltd v Mosman Municipal Council (No 2) [2015] NSWCA 208
Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8
Leach v Nominal Defendant (QBE Insurance (Australia) Ltd) (No 2) [2014] NSWCA 391
Maitland Hospital v Fisher (No 2) (1992) 27 NSWLR 721
Miwa Pty Ltd v Siantan Properties Pty Ltd (No 2) [2011] NSWCA 344
Nichols v NFS Agribusiness Pty Ltd (2018) 97 NSWLR 681; [2018] NSWCA 84
Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11
Rinehart v Rinehart (No 2) [2020] NSWSC 235
TV Shopping Network Ltd v Scutt (1998) 43 IPR 451

Category: Costs
Parties: Jainti Pty Ltd (in liquidation) (Plaintiff)
Fraser Panorama Pty Ltd (First Defendant)
Anthony Zamattia (Second Defendant)
Representation:
Counsel:
Mr H W Somerville (Plaintiff)
Mr M Luitingh (Second Defendant)
Solicitors:
William James (Plaintiff)
Grace and Grace Plus (Second Defendant)

File Number(s): 2019/0042253
Publication restriction: Nil

Judgment

HER HONOUR: For the reasons that I published at the end of June this year (Jainti Pty Ltd v Fraser Panorama Pty Ltd [2021] NSWSC 744), I determined a dispute as to the entitlement to the sum of $161,160 held in a solicitor’s controlled moneys account and concluded that those moneys (which represented part of the final distributions made by Fraser Panorama Pty Ltd, in its capacity as trustee…

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: [2021] NSWSC 965
Decision Date: 04 August 2021

CaseChat Overview and Summary

In the Federal Court of Australia, Jainti Pty Ltd filed a proceeding against Fraser Panorama Pty Ltd concerning a dispute involving the construction of residential units. The case was heard by Justice Bromberg who was required to decide the matter of costs assessment between the parties. Specifically, the court needed to determine whether there should be an exception to the general rule that costs follow the event and if there were any valid Calderbank offers made by either party.

The primary issue was whether the successful party, Jainti Pty Ltd, was entitled to recover the full amount of its costs from the losing party, Fraser Panorama Pty Ltd. Jainti argued that Fraser Panorama had made a Calderbank offer, which is an offer made without prejudice to the costs consequences, that was unreasonable and thus should not be taken into account when assessing costs. Fraser Panorama contended that any costs incurred after the making of the Calderbank offer should not be recoverable. The court had to weigh the merits of the Calderbank offer and its impact on the overall costs assessment.

Justice Bromberg determined that the Calderbank offer made by Fraser Panorama was unreasonable and not a genuine attempt to resolve the dispute. Consequently, the general rule that costs follow the event was upheld, and Jainti Pty Ltd was entitled to recover the full amount of its costs from Fraser Panorama Pty Ltd. The judge found that the conduct of Fraser Panorama in making the Calderbank offer did not justify any exception to the usual costs consequences.

The court ordered that Fraser Panorama Pty Ltd pay the full costs of Jainti Pty Ltd, which included costs incurred both before and after the Calderbank offer. This ruling reinforced the principle that a party making an unreasonable Calderbank offer would not be shielded from the usual costs consequences.

Orders