Kelen v Vitaman Pty Limited - [2010] NSWSC 328

CITATION: Kelen v Vitaman Pty Limited & Ors [2010] NSWSC 328

HEARING DATE(S): 3 March 2010

JUDGMENT DATE :
28 April 2010

JUDGMENT OF: Schmidt J

DECISION: 1. Leave to appeal is granted.
2. The appeal is upheld and the Local Court decisions are set aside.
3. The parties are to recalculate the sum owed to the plaintiff, in accordance with the conclusions reached in this judgment.
4 . The defendants are to bear two thirds of the plaintiff’s costs in the Local Court proceedings, as agreed or assessed.
5. The parties are to file short minutes to reflect the conclusions reached.

CATCHWORDS: APPEAL - leave to appeal against Local Court decisions - leave to appeal granted - loans advanced to defendant company on the security of personal guarantees provided by directors - calculation of moneys outstanding under loan - whether deduction of $10,000 discount agreed - calculation of prejudgment interest - award of $10,000 damages under cross claim - denial of natural justice - award of damages and prejudgment interest - contradicted findings in first judgment - unexplained departures from conclusions reached in first judgment - costs - unexplained departures from general rule - plaintiff's success in proceedings overlooked - both plaintiff and defendants partially successful - just cost order that defendants bear two thirds of plaintiff's costs - appeal upheld - Local Court decision set aside - costs

LEGISLATION CITED: Civil Procedure Act 2005
Local Courts Act 2007
Supreme Court Act 1970
Trade Practices Act 1974 (Cth)
Uniform Civil Procedure Rules 2005

CATEGORY: Principal judgment

CASES CITED: Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175
Autodesk Inc v Dyason (No 2) [1993] HCA 6; (1993) 176 CLR 300
Bell v Veigel [2008] NSWCA 36
Burwood Municipal Council v Harvey (1995) 86 LGERA 389
Coulton v Holcombe [1986] HCA 33; 162 CLR 1
Degmam Pty Ltd v Wright [1983] 2 NSWLR 348
Foakes v Beer (1884) 9 App Cas 605
Guardian Mortgages v Miller [2004] NSWSC 1236; (2004) 12 BPR 22,833
Liverpool City Council v Altaf Laskar [2010] NSWCA 52
Marks v GIO Holdings Ltd [1998] HCA 69; (1998) 196 CLR 494
Sasterawan v Morris [2008] NSWCA 70)
Suttor v Gundowda Pty Limited [1950] HCA 35; (1950) 81 CLR 418
Sydney South West Area Health Service v MD [2009] NSWCA 343; (2009) 260 ALR 702
Takemura v National Australia Bank Ltd [2003] NSWSC 339; (2003) 11 BPR 21,185
The Great Fingall Consolidated Ltd v Sheehan [1905] HCA 43; (1905) 3 CLR 176
Zheng v Cai [2009] HCA 52; (2009) 239 CLR 446
Todorovic v Moussa [2001] NSWCA 419; (2001) 53 NSWLR 463

PARTIES: Ronald Harry Kelen (Plaintiff)
Vitaman Pty Limited (First Defendant)
Clare Eileen Matthews (Second Defendant)
Glenn Alan Kiddell (Third Defendant)

FILE NUMBER(S): SC 2009/13752

COUNSEL: Mr RD Marshall, counsel (Plaintiff)
Mr RA Parsons, counsel (Defendants)

SOLICITORS: Matthew Grew Solicitor (Plaintiff)
CLS Legal (Defendants)

LOWER COURT…

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: [2010] NSWSC 328
Decision Date: 28 April 2010

CaseChat Overview and Summary

In the case of Kelen v Vitaman Pty Limited, the plaintiff sought leave to appeal against decisions made by the Local Court. The dispute involved loans advanced to the defendant company, secured by personal guarantees provided by the company's directors. The primary legal issues the court had to address were the calculation of moneys outstanding under the loan agreements, whether a $10,000 discount had been agreed upon, the calculation of prejudgment interest, and the award of damages and prejudgment interest under a cross-claim. Additionally, the court examined whether the findings in the first judgment had been contradicted, and if there had been unexplained departures from the conclusions reached in the first judgment.

The court found that the Local Court had made findings that were contradicted by the evidence and had made unexplained departures from the conclusions reached in the first judgment. The court noted that the award of damages and prejudgment interest was not supported by the evidence and that the award of $10,000 damages under the cross-claim was not justified. The court also found that the Local Court had failed to consider natural justice in its decision-making. Furthermore, the court determined that the Local Court had made an unjust cost order by not taking into account the plaintiff's success in the proceedings and by not allocating costs fairly between the parties.

The appeal was upheld, and the Local Court's decision was set aside. The court ordered that the defendants bear two-thirds of the plaintiff's costs. The detailed reasoning and analysis by the court highlight the importance of evidence-based decision-making and adherence to natural justice principles in legal proceedings. The final orders reflect the court's consideration of the overall fairness and just resolution of the dispute.

Orders