New South Wales
Court of Appeal
CITATION: Pegela Pty Ltd v Oates [2010] NSWCA 186 HEARING DATE(S): 27 April 2010
JUDGMENT DATE:
9 August 2010JUDGMENT OF: Allsop P at [1]; McColl JA at [22]; Young JA at [23] DECISION: (1) Appeal allowed.
(2) Judgment of the primary judge set aside.
(3) In lieu there be a verdict for the appellants for $91,000 plus interest.
(4) The respondents to pay the appellants' costs both here and at first instance, but with respect to the costs of the appeal have a certificate under the Suitors' Fund Act 1951 if qualified.CATCHWORDS: Appeal- Civil- whether leave to appeal required- District Court Act 1973, s 127(2)(c)- whether appeal involves $100,000 or more- realistic prospect of success. Contract- Formation of Contract- variation- relevance of subsequent conduct to formation of contract- agreement between parties to share in costs of litigation- initial discussion that appellants bound to pay 12% of the total costs- whether subsequent communications referring to 1/12th rate varied original agreement- whether subsequent conduct further varied any variation back to 12%- relevance of failure of appellant to give oral evidence regarding further variation- whether primary judge erred in holding respondents had overpaid based on binding 1/12 agreement- whether finding as to original agreement glaringly improbable- implied terms- whether implied term obvious, or necessary for the reasonable or effective operation of the contract- whether implied term that agreement net of GST. Procedure- Civil- whether account stated pleaded- whether case run at trial so as to require its consideration. LEGISLATION CITED: District Court Act 1973, s 127(2)(c)
Supreme Court Act 1970, s 101(2)CATEGORY: Principal judgment CASES CITED: Agricultural and Rural Finance Pty Ltd v Gardiner [2008] HCA 57; 238 CLR 570
Associated Alloys Pty Ltd v ACN 001 452 106 Pty Ltd (in liq) [2000] HCA 25; 205 CLR 588
BP Refinery (Westernport) Pty Ltd v President, Councillors and Ratepayers of the Shire of Hastings [1977] UKPCHCA 1; 180 CLR 266
Brambles Holdings Limited v Bathurst City Council [2001] NSWCA 61; 53 NSWLR 153
Breen v Williams [1966] HCA 57; 186 CLR 71
Byrne v Australian Airlines Ltd [1995] HCA 24; 185 CLR 410
Dovuro Pty Ltd v Wilkins [2003] HCA 51; 215 CLR 317
Eastern Express Pty Ltd v General Newspapers Pty Ltd (1992) 35 FCR 43
Federal Commissioner of Taxation v Sara Lee Household & Bodycare (Australia) Pty Ltd [2000] HCA 35; 201 CLR 520
Film Bars Pty Ltd v Pacific Film Laboratories Pty Ltd (1979) 1 BPR 9251
Fox v Percy [2003] HCA 22; 214 CLR 118
Gillard v Hunter Screen Products (No 2) [2001] NSWCA 450
Hawkins v Clayton [1988] HCA 15; 64 CLR 539
Hospital Products Ltd v United States Surgical Corporation [1984] HCA 64; 156 CLR 41
In re Stock; Ex parte Amos (1986) 66 LJQB 140
Integrated Computer Services Pty Ltd v Digital Equipment Corp (Aust) Pty Ltd (1988) 5 BPR 11,110
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Details
- AGLC
- Pegela Pty Ltd v Oates [2010] NSWCA 186
- Case
- [2010] NSWCA 186
- Decision Date
CaseChat Overview and Summary
Pegela Pty Ltd (appellant) appealed to the Court of Appeal of New South Wales against a judgment of the primary judge in favour of Oates (respondent). The dispute concerned the interpretation of an agreement between the parties regarding the sharing of litigation costs, specifically whether the appellant was bound to pay 12% or 1/12th of the total costs. The primary judge had found that the parties had agreed to a 1/12th share, leading to a finding that the respondent had overpaid.
The Court of Appeal was required to determine whether leave to appeal was necessary under section 127(2)(c) of the *District Court Act 1973* (NSW), considering whether the appeal involved a sum of $100,000 or more and whether there was a realistic prospect of success. Further, the court had to consider whether the primary judge erred in finding that the parties had entered into a binding agreement for a 1/12th share of costs, and whether subsequent conduct or communications varied this agreement, or indeed varied it back to the initially discussed 12% share. The court also considered whether an implied term that the agreement was net of GST was present and whether an "account stated" had been pleaded or run at trial.
The Court of Appeal found that leave to appeal was not required as the appeal involved a sum exceeding $100,000 and had a realistic prospect of success. The court reasoned that the primary judge's finding of a binding 1/12th agreement was not supported by the evidence and was, in fact, "glaringly improbable" given the initial discussions and subsequent conduct. The court concluded that the parties had not effectively varied the original agreement to a 1/12th share, and that the appellant's liability was indeed 12% of the total costs. The court also found that the primary judge erred in holding that the respondents had overpaid.
Consequently, the Court of Appeal allowed the appeal, set aside the judgment of the primary judge, and entered a verdict for the appellants for $91,000 plus interest. The respondents were ordered to pay the appellants' costs both at first instance and on appeal, with a potential certificate under the *Suitors' Fund Act 1951* for the appeal costs if qualified.
The Court of Appeal was required to determine whether leave to appeal was necessary under section 127(2)(c) of the *District Court Act 1973* (NSW), considering whether the appeal involved a sum of $100,000 or more and whether there was a realistic prospect of success. Further, the court had to consider whether the primary judge erred in finding that the parties had entered into a binding agreement for a 1/12th share of costs, and whether subsequent conduct or communications varied this agreement, or indeed varied it back to the initially discussed 12% share. The court also considered whether an implied term that the agreement was net of GST was present and whether an "account stated" had been pleaded or run at trial.
The Court of Appeal found that leave to appeal was not required as the appeal involved a sum exceeding $100,000 and had a realistic prospect of success. The court reasoned that the primary judge's finding of a binding 1/12th agreement was not supported by the evidence and was, in fact, "glaringly improbable" given the initial discussions and subsequent conduct. The court concluded that the parties had not effectively varied the original agreement to a 1/12th share, and that the appellant's liability was indeed 12% of the total costs. The court also found that the primary judge erred in holding that the respondents had overpaid.
Consequently, the Court of Appeal allowed the appeal, set aside the judgment of the primary judge, and entered a verdict for the appellants for $91,000 plus interest. The respondents were ordered to pay the appellants' costs both at first instance and on appeal, with a potential certificate under the *Suitors' Fund Act 1951* for the appeal costs if qualified.
Orders
Orders of the court
(1) Appeal allowed.
(2) Judgment of the primary judge set aside.
(3) In lieu there be a verdict for the appellants for $91,000 plus interest.
(4) The respondents to pay the appellants' costs both here and at first instance, but with respect to the costs of the appeal have a certificate under the Suitors' Fund Act 1951 if qualified.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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