Mesana Pty Ltd v Zamia Investments Pty Ltd (No 2)

[2010] QSC 451

SUPREME COURT OF QUEENSLAND

CITATION:

Mesana Pty Ltd v Zamia Investments Pty Ltd and Anor (No 2) [2010] QSC 451

PARTIES:

MESANA PTY LTD (ACN 106 499 727)
(Plaintiff)

v

ZAMIA INVESTMENTS PTY LTD (ACN 010 304 677)
(First Defendant)

and

ROBERT ARTHUR MICHAEL ASHLEY and DOROTHY JEAN ASHLEY
(Second Defendants)

FILE NO/S:

BS1628 of 2006

DIVISION:

Trial Division

PROCEEDING:

Claim

ORIGINATING COURT:

Supreme Court of Queensland

DELIVERED ON:

1 December 2010

DELIVERED AT:

Brisbane

HEARING DATE:

Written submissions

JUDGE:

Boddice J

ORDER:

The first defendant pay to the plaintiff the sum of $840,296.48.1.   

The second defendants pay to the plaintiff the sum of $734,105.04.2.   

The first and second defendants pay the plaintiff’s costs of and incidental to the proceeding, including all reserve costs, such costs to be agreed, or failing agreement, to be assessed on the standard basis.3.   

CATCHWORDS:

PROCEDURE – COSTS –NATURE OF PROCEEDINGS –
CONTRACTS – CLAIM FOR RECOVERY OF DEBT –   where judgment was entered for the plaintiff against the first and second defendants in respect of moneys due and owing under a loan agreement and other facilities – where significant periods of delay – whether the plaintiff is entitled to recover interest

COUNSEL:

JW Peden for the plaintiff

C Wilson for the first and second defendants

SOLICITORS:

Gadens Lawyers for the plaintiff

Courtice Neilsen Lawyers for the first and second defendants

1. On 17 November 2010, I ordered that judgment be entered in favour of the plaintiff against the first defendant in respect of moneys due and owing under a fixed rate interest only loan and a cheque facility, and against the second defendants pursuant to guarantees. 

1. The defendants submit the plaintiff ought not to recover interest for the entire claimed period having regard to three significant periods of delay:

(a)        A delay of one year and ten months after assignment of the debts before making demand for repayment.

(b)        A delay of six months after making demand for repayment before proceedings commenced.

(c)        A period of two years and two months between disclosure and the taking of a further step in the proceedings.

The defendants submit interest should not be allowed for these periods absent a sufficient explanation for the delay.  They rely on a number of authorities in support of this contention.[1] 

[1]Serisier Investments Pty Ltd v English [1989] 1 Qd R 678, 679; Interchase Corporation Limited (in liq) v Grosvenor Hill (Qld) Pty Ltd (No 3) [2003] 1 Qd R 26 at 53 [61]; White Industries Qld Pty Ltd v Flower & Hart (No 2) (2000) 177 ALR 567 at [30]-[37]; Zipside Pty Ltd v Anscor Pty Ltd [2000] QCA 395 at [11].

1. The plaintiff submits there is no basis to deny interest in relation to the fixed rate interest only loan and the guarantees as those claims are made at the rate stipulated in the relevant contracts, and the statutory discretion to award interest under s 47 of the Supreme Court Act 1995 applies only where there is no contractual provision.  Further, there is no basis to deny interest on the cheque facility as whatever delay there may have been, the defendants have had the benefit of the funds for the entire period and have adduced no evidence of any prejudice. 

1. Having considered the submissions of the parties and the relevant authorities, I am satisfied it is appropriate for the plaintiff to recover interest for the entire period.  The defendants have had the benefit of the use of the funds over that period.  Further, there is no suggestion the defendants placed the plaintiff on notice at any time during that period that ongoing delay in recovery of the sums would result in prejudice to the defendants.  There is also no suggestion any relevant offers to settle were made in the intervening period. 

1. Those factors, together with the fact that the moneys owing under the fixed rate interest only loan are claimed pursuant to the terms of that loan, as are the sums claimed pursuant to the guarantees, render it appropriate the plaintiff recover the sums claimed by it by way of interest.  The factors identified in [5] also render it appropriate that the plaintiff recover the sums claimed by it by way of interest in respect of the cheque account facility. 

1. I order:

1.          The first defendant pay to the plaintiff the sum of $840,296.48.

2.          The second defendants pay to the plaintiff the sum of $734,105.04.

3.          The first and second defendants pay the plaintiff’s costs of and incidental to the proceeding, including all reserve costs, such costs to be agreed, or failing agreement, to be assessed on the standard basis.