Perpetual Trustee Company Ltd v Papantoniou (No. 2)

[2014] NSWSC 746

Supreme Court

New South Wales

Medium Neutral Citation:

Perpetual Trustee Company Ltd v Papantoniou (No. 2) [2014] NSWSC 746

Hearing dates:

5 June 2014

Decision date:

10 June 2014

Jurisdiction:

Common Law

Before:

Campbell J

Decision:

In the first cross-claim brought by Robert Brown

(1)The orders pronounced on 30th May 2014 are revoked.

(2)Under s 7(1)(b) Contracts Review Act 1980 declare the contract among Robert Brown, James Brown and Stella Papantoniou to the extent to which it provides for the liability of Mrs Papantoniou for the loan from Perpetual Trustee Company Limited to be borne by Robert Brown and James Brown void ab initio.

(3)Order Stella Papantoniou pay compensation to Robert Brown in the sum of $188,408.87 inclusive of interest under s 100 Civil Procedure Act 2005.

(4)Order Mrs Papantoniou to pay the costs of Mr Robert Brown on the ordinary basis forthwith after they have been agreed or assessed.

(5)Grant liberty to Mr Robert Brown to apply for a variation of the costs order within 7 days by lodging with my Chambers written submissions, not exceeding two pages in length, supported by an affidavit exhibiting any offer of compromise made. The cross-defendant has a further 7 days to lodge any written response not exceeding 2 pages in length.

The third cross-claim brought by Robert Brown as Executor of the Estate of James Brown

(1)The orders pronounced on 30th May 2014 are revoked.

(2)Under s 7(1)(b) Contracts Review Act 1980 declare the contract among Robert Brown, James Brown and Stella Papantoniou to the extent to which it provides for the liability of Mrs Papantoniou for the loan from Perpetual Trustee Company Limited to be borne by Robert Brown and James Brown void ab initio.

(3)Order that Stella Papantoniou pay compensation to the Estate of the late James Brown in the sum of $131,456.59 inclusive of interest calculated under s 100 Civil Procedure Act 2005.

(4)Order Stella Papantoniou to pay the costs of the Estate of the late James Brown on the ordinary basis forthwith after they have been agreed or assessed.

(5)Grant liberty to the Estate of the Late James Brown to apply for a variation of the costs order within 7 days by lodging with my Chambers written submissions, not exceeding two pages in length, supported by an affidavit exhibiting any offer of compromise made. The cross-defendant has a further 7 days to lodge any written response not exceeding 2 pages in length.

The second cross-claim brought by Mrs Stella Papantoniou

(1)The orders pronounced on 30th May 2014 are revoked.

(2)Declare that Mrs Papantoniou is the party entitled to the funds held on trust by Barwick Boitano, Lawyers in the sum of $51,159.09 and interest accruing (if any).

(3)Upon the trustees first being satisfied that Mrs Papantoniou has satisfied order (3) pronounced today in each of the first and third cross-claim I direct Barwick Boitano to pay the funds referred to in order (2) to Mrs Papantoniou, whose receipt whereof will discharge Barwick Boitano's obligations as trustees.

(4)Grant the parties liberty to apply in respect of order (3) if order (3) pronounced in each of the first and third cross claims today remains unsatisfied after 28 days.

(5)The second-cross claim is otherwise dismissed with Mrs Papantoniou to pay the costs of the first and third cross-claimants on the ordinary basis forthwith after they have been agreed or assessed,

(6)Grant liberty to the first and second cross-claimants to apply for a variation of the costs order within 7 days by lodging with my Chambers written submissions, not exceeding two pages in length, supported by an affidavit exhibiting any offer of compromise made. The cross-defendant has a further 7 days to lodge any written response not exceeding 2 pages in length.

Catchwords:

PROCEDURE - civil - rectification of orders - slip rule
REMEDIES - damages - calculation of pre-judgment interest

Legislation Cited:

Uniform Civil Procedure Rules 2005 (NSW)

Category:

Consequential orders

Parties:

Robert Joseph Patrick Brown (First Cross-Claimant)
Robert Joseph Patrick Brown as executor of the Estate of the late James Anthony Thomas Brown (Third Cross-Claimant)
Styliani Papantoniou (First Cross-Defendant)

Representation:

Counsel: M Maconachie (First and Third Cross-Claimants)
J Merkel (First Cross-Defendant)
Solicitors: Barwick Boitano Lawyers (First and Third Cross-Claimant)
Northern Suburbs Lawyers (First Cross-Defendant)

File Number(s):

2010/28341

Judgment

1. I pronounced orders in this matter disposing of outstanding cross-claims on 30th of May 2014 ([2014] NSWSC 685).

1. Upon reviewing my reasons I noted that I had overlooked deducting the sum of $4,000 referred to [141] of my judgment as part of the calculation set out at [144]. It seemed obvious that this oversight should be corrected under Rule 36.7 Uniform Civil Procedure Rules 2005 (NSW) (the Slip Rule).

1. Accordingly, I listed the matter for directions on Thursday 5th June 2014 when the parties where represented as before by Mr Maconachie of Counsel for Robert Brown and the Estate of James Brown, and Ms Merkel of Counsel for Mrs Papantoniou.

1. Counsel agreed that the correction should be made and I will attend to it below.

1. As it was necessary to bring Counsel back, I thought it expedient to deal with the question of interest, which I decided but did not calculate at [145]. To that end, I sent Counsel a working paper recalculating the amounts to which Robert Brown and the Estate of James Brown were entitled, calculating interest on those amounts, and showing the total amounts due in each case. Mr Maconachie points out, very fairly, that my interest rate is 2% higher than the rate fixed by Practice Note SC Gen 16. Ms Merkel agrees. I accept this and have rectified that error accordingly.

1. It was also submitted that in dividing the interest payable between the Estate of the late James Brown and Robert Brown I had made an arithmetical error. This is not so. Rather Counsel have overlooked the need to deduct $4,000 from the share of James Brown's Estate to correct my slip. This alters the strict 58:42 apportionment. My final calculations appended. Otherwise Counsel were in agreement that my orders should be amended to reflect the correction of the slip and the incorporation of interest.

1. Three other matters were raised with me by Counsel. First, I was reminded that the "surplus notionally due to Mrs Papantoniou" after discharge of the total debt due to the plaintiff as mortgagee referred to at [79] and [147] - [148] of my judgment which had been held initially on trust by the plaintiff's solicitors, Norton Rose, had been transferred to the solicitors acting for Robert Brown and the Estate of the Late James Brown, Barwick Boitano Lawyers to hold on trust prior to the hearing before me. Moreover, during the long time I took for consideration of my decision, that fund had been depleted partially by the payment from it of an interlocutory costs order due from Mrs Papantoniou to the Brown interests. This had been assessed in the interim. Counsel also inform me that the current balance is $51,159.09.

1. As there will be significant changes to the orders pronounced by me in each of the three cross claims on 30th May 2014, I am of the view that it is expedient to simply revoke the orders previously pronounced and make new orders reflecting the changes necessitated by the circumstances I have just outlined.

1. Secondly, Mr Maconachie sought an express reservation of liberty for his clients to apply for the release of the trust fund to them should Mrs Papantoniou fail to satisfy the judgements for compensation in their favour within 28 days. I did not understand Ms Merkel to argue that some such order was not appropriate and I will accordingly accede to Mr Maconachie's application.

1. Thirdly, I am informed that an offer of compromise was made and that the Brown parties may wish to apply for an order for indemnity costs. I will permit any such application to be made by written submissions lodged with my Chambers with an opportunity for Mrs Papantoniou to reply. I have included the working paper forwarded to Counsel as an appendix.

1. It seems to me appropriate that the sum of $4,000 in respect of the additional legal fees for the Estate of James Brown be deducted from the Estate's share of the compensation I have assessed before the addition of interest. That will reduce the figure of $109,642.26 mentioned at [144] of my judgment to $105,642.26. The latter figure is the figure upon which interest has been calculated.

Orders

1. My orders are:

In the first cross-claim brought by Robert Brown

(1)   The orders pronounced on 30th May 2014 are revoked.

(2) Under s 7(1)(b) Contracts Review Act 1980 declare the contract among Robert Brown, James Brown and Stella Papantoniou to the extent to which it provides for the liability of Mrs Papantoniou for the loan from Perpetual Trustee Company Limited to be borne by Robert Brown and James Brown void ab initio.

(3) Order Stella Papantoniou pay compensation to Robert Brown in the sum of $188,408.87 inclusive of interest under s 100 Civil Procedure Act 2005.

(4)   Order Mrs Papantoniou to pay the costs of Mr Robert Brown on the ordinary basis forthwith after they have been agreed or assessed.

(5)   Grant liberty to Mr Robert Brown to apply for a variation of the costs order within 7 days by lodging with my Chambers written submissions, not exceeding two pages in length, supported by an affidavit exhibiting any offer of compromise made. The cross-defendant has a further 7 days to lodge any written response not exceeding 2 pages in length.

The third cross-claim brought by Robert Brown as Executor of the Estate of James Brown

(1)   The orders pronounced on 30th May 2014 are revoked.

(2) Under s 7(1)(b) Contracts Review Act 1980 declare the contract among Robert Brown, James Brown and Stella Papantoniou to the extent to which it provides for the liability of Mrs Papantoniou for the loan from Perpetual Trustee Company Limited to be borne by Robert Brown and James Brown void ab initio.

(3) Order that Stella Papantoniou pay compensation to the Estate of the late James Brown in the sum of $131,456.59 inclusive of interest calculated under s 100 Civil Procedure Act 2005.

(4)   Order Stella Papantoniou to pay the costs of the Estate of the late James Brown on the ordinary basis forthwith after they have been agreed or assessed.

(5)   Grant liberty to the Estate of the Late James Brown to apply for a variation of the costs order within 7 days by lodging with my Chambers written submissions, not exceeding two pages in length, supported by an affidavit exhibiting any offer of compromise made. The cross-defendant has a further 7 days to lodge any written response not exceeding 2 pages in length.

The second cross-claim brought by Mrs Stella Papantoniou

(1)   The orders pronounced on 30th May 2014 are revoked.

(2)   Declare that Mrs Papantoniou is the party entitled to the funds held on trust by Barwick Boitano, Lawyers in the sum of $51,159.09 and interest accruing (if any).

(3)   Upon the trustees first being satisfied that Mrs Papantoniou has satisfied order (3) pronounced today in each of the first and third cross-claim I direct Barwick Boitano to pay the funds referred to in order (2) to Mrs Papantoniou, whose receipt whereof will discharge Barwick Boitano's obligations as trustees.

(4)   Grant the parties liberty to apply in respect of order (3) if order (3) pronounced in each of the first and third cross claims today remains unsatisfied after 28 days.

(5)   The second-cross claim is otherwise dismissed with Mrs Papantoniou to pay the costs of the first and third cross-claimants on the ordinary basis forthwith after they have been agreed or assessed,

(6)   Grant liberty to the first and second cross-claimants to apply for a variation of the costs order within 7 days by lodging with my Chambers written submissions, not exceeding two pages in length, supported by an affidavit exhibiting any offer of compromise made. The cross-defendant has a further 7 days to lodge any written response not exceeding 2 pages in length.

**********

Appendix

476,254.21 (Sum paid out)

200,600.00 (Equity of Ms Papantoniou)

275,654.00

13,431.00 (66% of DA costs)

1,170.00 (Council Rates)

261,053.00

James Brown	Robert Brown
(0.42 * 261,053.00) - 4,000.00 (legal fees)	(0.58 * 261,053.00)
105,642.26	151,410.74
257,053.00
Shares including interest
$131,456.59	$188,408.87

Interest working as per r 36.7

18 March - 30 June 2011 (4.75+4= 8.75) 105/365 = 6,470.34

1 July - 31 December 2011 (4.75+4= 8.75) 184/365 = 11,338.50

1 January - 30 June 2012 (4.25+4= 8.25) 182/366 = 10,545.49

1 July - 31 December 2012 (3.50+4= 7.50) 184/366 = 9,692.16

1 January - 30 June 2013 (3.00+4= 7.00) 181/365 = 8,922.91

1 July - 31 December 2013 (2.75+4 = 6.75) 184/365 = 8,746.84

1 January - 30 May 2014 (2.50+4 = 6.50) 150/365 = 6,866.48

62,812.46

257,053.00

319,865.46 (total sum including interest)

This figure is then divided into the shares of the brothers

James Brown = 105,642.26/257,053.00 * 319,865.46 = $131,456.59

Robert Brown = 151,410.74/257,053.00 * 319,865.46 = $188,408.87

Decision last updated: 10 June 2014