Muller & McIntosh (as joint & several liquidators of Arafura Equities P/L (in liq)) v. Academic Systems P/L

[2007] QCA 256

SUPREME COURT OF QUEENSLAND

CITATION:

Muller & McIntosh (as joint & several liquidators of Arafura Equities P/L (in liq)) v Academic Systems P/L [2007]
QCA 256

PARTIES:

GINETTE MULLER and LACHLAN MCINTOSH as joint and several liquidators of ARAFURA EQUITIES PTY LTD (in liquidation) ACN 083 542 929
(applicants/appellants)
v
ACADEMIC SYSTEMS PTY LTD ACN 060 989 442
(respondent)

FILE NO/S:

Appeal No 3994 of 2007
DC No 2666 of 2006

DIVISION:

Court of Appeal

PROCEEDING:

General Civil Appeal – Further Order

ORIGINATING COURT:

District Court at Brisbane

DELIVERED ON:

10 August 2007

DELIVERED AT:

Brisbane

HEARING DATE:

Heard on the papers

JUDGES:

Williams JA, White and Atkinson JJ
Separate reasons for judgment of each member of the Court, each concurring as to the order made

ORDER:

That paragraph 7 of the orders pronounced in this matter on 13 July 2007 be amended to read:
"7. The respondent pay the appellants' costs of and incidental to the proceedings in the District Court assessed on an indemnity basis and of this appeal to be assessed."

CATCHWORDS:

PROCEDURE – COSTS – DEPARTING FROM THE GENERAL RULE – ORDER FOR COSTS ON INDEMNITY BASIS – where judgment given in appellants' favour – where respondent ordered to pay costs of District Court proceedings to be assessed – where leave granted to make written submissions on the issue of costs – where appellant made an offer to settle prior to commencing proceedings – where appellant obtained judgment on appeal that was "no less favourable than the offer to settle" – whether costs should be awarded on an indemnity basis

Uniform Civil Procedure Rules 1999 (Qld), r 360

Calderbank v Calderbank [1976] Fam 93, cited

SOLICITORS:

Holman Webb Layers for the appellant
No submissions on behalf of the respondent

1. WILLIAMS JA: On 13 July 2007 the Court pronounced judgment, allowing the appeal, and making a series of orders in favour of the appellants.  At that time the order was made that the respondent pay the costs of the appellants of and incidental to the proceedings in the District Court and of the appeal to be assessed.

1. On that day the parties were given leave to make written submissions with respect to whether the costs of the appellants should be payable on an indemnity basis. 

1. The Court has received written submissions on that topic from the appellants, but no submissions have been received by or on behalf of the respondent. 

1. The submissions on behalf of the appellants includes a letter dated 13 September 2006 from the solicitors for the appellants to the solicitors for the respondent.  Relevantly it stated:

"Our client is prepared to resolve this unfair preference claim on the following basis:

1.             Your client pays to our client the sum of $75,000.00 (inclusive of GST) for claim, costs and interest within 14 days of the acceptance of this offer;

2.             The offer, if accepted, will be in full and final satisfaction of our client's claim;"

1. The letter made it clear that it was an offer made pursuant to Chapter 9 Part 5 of the Uniform Civil Procedure Rules 1999 (Qld) ("UCPR") and the principle derived from Calderbank v Calderbank [1976] Fam 93.

1. On the same day as that letter was sent the proceedings were commenced in the District Court.  The offer was not accepted and the matter proceeded to trial.  The trial was heard in the District Court at Brisbane on 22 January 2007. 

1. The order of the Court of Appeal effectively ordered the respondent to pay to the appellants the sum of $83,000 together with interest plus costs. Clearly the appellant obtained a judgment that was "no less favourable than the offer to settle" contained in the letter of 13 September 2006 and in consequence, by operation of r 360 of the UCPR, the Court must order the respondent to pay the costs of the appellants calculated on the indemnity basis unless the respondent shows it is appropriate in the circumstances to make some other order. The respondent has not done so, and in consequence the appellants are entitled to costs on an indemnity basis.

1. The appellants have sought an order that "the respondent pay the appellants' costs of and incidental to the District Court proceedings on an indemnity basis."  The appellants have established an entitlement to that order and in consequence there should be added to paragraph 7 of the order made on 13 July 2007 a provision that the costs of proceedings in the District Court be assessed on an indemnity basis.  In consequence paragraph 7 of the order as pronounced should be amended to read: 

"7.The respondent pay the appellants' costs of and incidental to the proceedings in the District Court assessed on an indemnity basis and of this appeal to be assessed."

1. WHITE J: I agree with Williams JA.

1. ATKINSON J: I agree with Williams JA.