Professional Services of Australia Pty Ltd v Computer Accounting and Tax Pty Ltd [No 2]
[2009] WASCA 183 (S)
•23 OCTOBER 2009
PROFESSIONAL SERVICES OF AUSTRALIA PTY LTD -v- COMPUTER ACCOUNTING AND TAX PTY LTD [No 2] [2009] WASCA 183 (S)
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2009] WASCA 183 (S) | |
| THE COURT OF APPEAL (WA) | |||
| Case No: | CACV:76/2008 | 22 JULY, 23 OCTOBER, 13 NOVEMBER 2009 AND ON THE PAPERS | |
| Coram: | MARTIN CJ BUSS JA NEWNES JA | 23/10/09 | |
| 7/12/09 | |||
| 11 | Judgment Part: | 1 of 1 | |
| Result: | Costs and other orders made | ||
| B | |||
| PDF Version |
| Parties: | PROFESSIONAL SERVICES OF AUSTRALIA PTY LTD MARTIN PAUL BANNING COMPUTER ACCOUNTING AND TAX PTY LTD |
Catchwords: | Costs Consent order Whether order should be revoked Whether various orders should be stayed pending application for special leave to High Court Appellants' costs of appeal where they have abandoned grounds of appeal |
Legislation: | Nil |
Case References: | Ansons Pty Ltd v Merlex Corporation Pty Ltd [2001] WASC 204 Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (No 1) (1986) 161 CLR 681 Kalavrouziotis v Howel (unreported, WASC, Library No 980428, 30 July 1998) Professional Services of Australia Pty Ltd v Computer Accounting and Tax Pty Ltd [No 2] [2009] WASCA 183 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA TITLE OF COURT : THE COURT OF APPEAL (WA) CITATION : PROFESSIONAL SERVICES OF AUSTRALIA PTY LTD -v- COMPUTER ACCOUNTING AND TAX PTY LTD [No 2] [2009] WASCA 183 (S) CORAM : MARTIN CJ
- BUSS JA
NEWNES JA
- ON THE PAPERS
DECISION : 7 DECEMBER 2009 FILE NO/S : CACV 76 of 2008 BETWEEN : PROFESSIONAL SERVICES OF AUSTRALIA PTY LTD
- First Appellant
MARTIN PAUL BANNING
Second Appellant
AND
COMPUTER ACCOUNTING AND TAX PTY LTD
Respondent
(Page 2)
ON APPEAL FROM:
Jurisdiction : SUPREME COURT OF WESTERN AUSTRALIA
Coram : SIMMONDS J
Citation : COMPUTER ACCOUNTING AND TAX PTY LTD -v- PROFESSIONAL SERVICES OF AUSTRALIA PTY LTD [2008] WASC 133
File No : CIV 2265 of 2006
Catchwords:
Costs - Consent order - Whether order should be revoked - Whether various orders should be stayed pending application for special leave to High Court - Appellants' costs of appeal where they have abandoned grounds of appeal
Legislation:
Nil
Result:
Costs and other orders made
Category: B
Representation:
Counsel:
First Appellant : Mr A Hershowitz
Second Appellant : Mr A Hershowitz
Respondent : Mr C P Stokes
Solicitors:
First Appellant : Holborn Lenhoff Massey
Second Appellant : Holborn Lenhoff Massey
Respondent : Chris Stokes & Associates
Case(s) referred to in judgment(s):
Ansons Pty Ltd v Merlex Corporation Pty Ltd [2001] WASC 204
Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (No 1) (1986) 161 CLR 681
Kalavrouziotis v Howel (unreported, WASC, Library No 980428, 30 July 1998)
Professional Services of Australia Pty Ltd v Computer Accounting and Tax Pty Ltd [No 2] [2009] WASCA 183
(Page 4)
1 JUDGMENT OF THE COURT: On 23 October 2009, this court published its reasons for concluding that the appeal should be allowed, and that part of the decision of the trial judge awarding the respondent damages in the sum of $675,078 together with interest thereon should be set aside, and further allowed by reducing the damages awarded by the trial judge for the loss on acquisition of the property the subject of the proceedings by $6,500, together with a corresponding reduction in the interest awarded on that sum (Professional Services of Australia Pty Ltd v Computer Accounting and Tax Pty Ltd [No 2] [2009] WASCA 183). The parties have been unable to agree as to the orders properly made to give effect to that conclusion, nor as to the orders appropriately made in consequence. Directions were made for the exchange of written submissions on those issues and for their determination on the papers. These reasons deal with those issues.
The publication of reasons for decision on the appeal
2 The parties' legal representatives were provided with a copy of the reasons to be published on the appeal the day before those reasons were formally published in open court, in accordance with Practice Direction 8.1. At the time the reasons for decision were published in court on 23 October 2009, counsel for the appellants indicated that each of the parties had produced competing minutes in relation to the orders appropriately made, and proposed to tender them to the court. However, as only one member of the coram was present (the Chief Justice), that member indicated that in the absence of agreement between the parties it would be necessary to either reconstitute the coram to hear argument on issues that were in dispute, or set a timetable for the resolution of those disputes by a decision of the court to be determined on the papers. The parties agreed that the latter course should be followed. Before directions were made to that effect, counsel for the appellants proposed that certain orders on their minute were agreed, and could be made by consent. Counsel for the respondent agreed that the orders numbered 1, 2, 3 and 7 on the appellants' minute could be made by consent, and the Chief Justice pronounced orders in those terms. Those orders were:
1. The appeal against the judgment of his Honour Justice Simmonds given in favour of the respondent on 9 July 2008 be allowed.
2. Order 1 of the orders made by his Honour Justice Simmonds on 10 July 2008 is set aside.
3. In lieu of the order referred to in paragraph 2 hereof, it is ordered that:
- 1. The defendants do forthwith pay to the plaintiff:
1.1 The sum of $280,625.00 together with the sum of $87,370.48 being interest at the rate of 6 per cent per annum from 1 May 2003 to 9 July 2008, and thereafter $46.13 per day from 9 July 2008 to the date of payment.
1.2 The sum of $4,999.50 together with the sum of $1,444.24 being interest thereon at the rate of 6 per cent per annum from 15 September 2003 to 9 July 2008, and thereafter $0.82 per day from 9 July 2008 to the date of payment.
- 7. The amount of $38,000.00 paid into court by the appellants on 10 December 2008 as security for the respondent's costs of the appeal to be paid out of court to the appellant's solicitors forthwith.
3 Directions were made for the exchange of written submissions in relation to the matters that remained in contention.
4 An order in the terms pronounced by the Chief Justice was lodged for extraction. However, before the document had been extracted, a letter was received from a director of the respondent indicating that the respondent objected to orders being extracted in those terms, notwithstanding the fact that counsel on its behalf had consented to them being made. As the respondent remained represented by solicitors on the record, it was entirely inappropriate for the director of the respondent to communicate with the court in this way. In all events, in due course, the solicitors for the respondent advised the solicitors for the appellants that the respondent no longer consented to orders being made in terms of pars 3 and 7 of the appellants' minute. In relation to par 3, the reason advanced for the disputed minute is the assertion that interest had been wrongly calculated, and, in respect of the first amount for which judgment was to be entered, should be expressed as $60.49 per day from 9 July 2008 (not $46.13), and in respect of the second sum for which judgment is to be entered, should be expressed at the rate of $1.06 per day from 9 July 2008 to the date of payment (instead of $0.82 per day).
5 In relation to the order numbered 7 in the appellants' minute, which related to the payment out of court of funds lodged by the appellants by way of security for the respondent's costs of the appeal, the respondent purported to justify its withdrawal of consent to an order in those terms on the basis that an application for special leave to appeal was to be made to the High Court, with the result that the amount should remain as and by way of security until that application had been determined.
(Page 6)
6 Thereafter the appellants advised the court and solicitors for the respondent that they agreed with the proposed variation in relation to the amounts for which judgment was to be entered in respect of interest. However, the respondent did not consent to orders being made in the modified form. Accordingly, a further hearing before the Chief Justice was convened on 13 November 2009, at which directions were made for the exchange of written submissions on the expanded issues. We will deal with each of those issues in turn.
The interest on the amounts for which judgment is to be entered
7 There is no dispute as to the amounts for which judgment should be entered as a consequence of the allowance of the appeal. Nor is there any dispute between the parties as to the interest which should be paid on those amounts as and from 9 July 2008 until payment, although the appellants' original minute miscalculated that amount. There is no reason why orders should not be made in terms of the correct amount.
The amount paid into court by the appellants as security for the respondent's costs of the appeal
8 As has been noted, the respondent by its counsel consented to an order that the amount paid by the appellants into court by way of security for the respondent's costs of appeal be paid out to the appellants. It seems a fair inference from the events which took place at the time that order was made by consent, including in particular the apparent provision of instructions to counsel by a representative of the respondent during the course of that hearing, that an officer or officers of the respondent were present in court during the course of that hearing. In those circumstances it would be exceptional indeed for the court to revoke an order made by consent (Ansons Pty Ltd v Merlex Corporation Pty Ltd [2001] WASC 204 at [49]). However, it is unnecessary to consider the principles relating to the revocation of orders made by consent in this case, because there is plainly no basis upon which such a course should be followed.
9 The position adopted by the respondent confuses the making of an order, and an application for a stay of orders made pending appeal. When a court from which an appeal lies pronounces orders, it will generally be appropriate for that court to pronounce all orders appropriately made to finally dispose of the case, even when an appeal is foreshadowed. The obvious advantage of this general practice is that it enables the appellate court to dispose of all matters when the matter comes before it, rather than leave the issues to be resolved in each of two courts.
(Page 7)
10 The question of whether an order pronounced by a court in the disposition of a case before it should be stayed pending the determination of an appeal from that decision is an entirely different question. There are, of course, various principles governing the question of whether a stay should be granted. Amongst them is the principle that where the appeal lies from an intermediate appellate court to the High Court of Australia by special leave, an application for a stay should first be made to the court from which the appeal lies (Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (No 1) (1986) 161 CLR 681, 684). In Jennings, Brennan J noted at 684:
A stay to preserve the subject-matter of litigation pending an application for special leave to appeal is an extraordinary jurisdiction and exceptional circumstances must be shown before its exercise is warranted. If an order for a stay is made, the respondent is kept out of the benefit of the order of the court in which the matter is pending until the hearing of the application for special leave to appeal.
11 Although the position of the respondent in relation to these matters is not pellucidly clear from the various positions it has adopted, it seems that in addition to opposing the making of orders for the payment out of the funds paid into court by the appellants by way of security for the costs of the appeal, the respondent also seeks a stay of that order. That stay is sought apparently by reference to certain provisions in a Deed of Company Arrangement and assertions in respect of outstanding costs orders. However, neither the Deed of Company Arrangement, nor the assertions in respect of outstanding costs orders have been put in evidence before this court. There is a further assertion that both appellants are insolvent. That assertion is said to be justified by an affidavit of Graeme Trevor Lean dated 10 October 2009 filed in CIV 2265 of 2006. There is no such affidavit. There is an affidavit of Mr Lean sworn 10 September 2009. Mr Lean is a court-appointed receiver in respect of the one share of the second appellant in Banning Holdings Pty Ltd. The assertions made in that affidavit do not bear upon the solvency of either appellant.
12 In summary, no reason has been advanced which would justify revoking the order made by consent to the effect that the appellants be paid out the amount which they paid into court by way of security for the respondent's costs of the appeal, the appellants having been substantially successful in that appeal. In relation to the assertion that such an order should be stayed, there is currently no evidence before the court establishing the exceptional circumstances necessary to justify the grant of a stay. This is not to say that such evidence could not be adduced. In the circumstances of this case, the interests of justice justify allowing the
(Page 8)
- respondent liberty to apply generally, which would enable an application for a stay to be brought on proper grounds and supported by evidence.
Repayment of part of the judgment sum
13 The appellants eventually satisfied the judgment entered at first instance, by payments made on 2 June and 5 June 2009. Because of the allowance of the appeal, and the reduction in the judgment entered, they are entitled to a refund of the moneys overpaid, together with interest. There is no dispute between the parties as to the amounts involved.
14 However, the respondent opposes orders being made to require repayment of those amounts essentially for the same reasons the order releasing the amount paid by the appellants as security for the costs of the appeal was opposed - namely, on the basis that an application for special leave to appeal to the High Court is to be made, and assertions in respect of the financial position of the appellants which are not sustained by any evidence. Again the respondent's position confuses the question of whether orders should be made with the distinct question of whether there should be a stay of those orders pending an application for special leave to appeal. There is no reason why orders should not be made quantifying the obligation of the respondent to repay the amounts overpaid by the appellants. The question of whether or not those orders should be stayed is a separate question. There is no evidence before the court that would justify any orders of that kind.
Costs of the appeal
15 The appellants seek an order that their costs of the appeal be paid by the respondent. The respondent opposes that order on the basis that the appellants were not wholly successful in the appeal. Although the oral argument on the hearing of the appeal was essentially directed to the issues upon which the appellants were successful, the grounds of appeal which were filed and supported by written submissions, identified a number of discrete issues which were abandoned at the commencement of the oral hearing. Prior to their abandonment, the respondent had been put to expense in preparing written submissions in opposition to those grounds.
16 There is no inflexible rule that an appellant will be deprived of the full costs of their appeal if substantially successful because he or she did not succeed on some grounds - see Kalavrouziotis v Howel (unreported, WASC, Library No 980428, 30 July 1998). Generally the court will assess the extent to which the discrete issues upon which the substantially
(Page 9)
- successful party lost added to the costs of the litigation in order to assess whether some adjustment of the usual costs order is appropriate.
17 In this case, the appellants advanced a number of grounds of appeal which were quite separate and distinct to the grounds upon which they were ultimately successful. Although those grounds were abandoned at the commencement of the hearing, the respondent would no doubt have incurred costs in responding to those grounds. In our view, it is appropriate in this case to reduce the costs to be awarded to the appellants to reflect the costs incurred by the respondent responding to the grounds which were abandoned. Those costs are best reflected by ordering that the respondent pay 80% of the appellants' taxed costs of the appeal.
Costs of the proceedings at first instance
18 The appellants seek an order setting aside the orders for costs made by the trial judge, and remitting the matter to him for further consideration in light of the judgment of this court. The respondent seeks orders varying the orders made by the trial judge in certain particulars.
19 The trial judge made orders apportioning the costs between the parties to the trial based on a number of considerations. Certain special costs orders were made which could well be affected by the reasons of this court. The usual practice when issues of this kind arise is to remit the matter to the trial judge, who is in the best position to evaluate the appropriate order for the costs of the trial, having presided over it. There is no reason why that practice should not be followed in this case.
The costs of resolving the issues relating to the orders properly made on the appeal
20 The appellants seek an order for indemnity costs in respect of the costs incurred by them in resolving these various costs issues. They make that application on the basis of the unreasonable position adopted by the respondent, in purporting to resile from orders that were made by consent. In our view, the respondent has acted unreasonably in relation to these matters. Despite the amounts involved not being contentious, and the need for orders to reflect the reasons of this court being obvious, after initially consenting to some appropriate orders, the respondent purported to withdraw that consent, and then opposed the making of orders on grounds which were confused and unsupported by evidence. The appellants should not be out of pocket as a consequence of the respondent's unreasonable behaviour, and accordingly we will order that such part of the appellants' costs of the appeal as relate to the resolution of
(Page 10)
- issues with respect to the orders to be made on the appeal be taxed on an indemnity basis, in that the appellants are to be awarded all costs reasonably incurred and which are reasonable in amount in respect of those issues.
Conclusion
21 In addition to orders 1, 2 and 7 pronounced on 23 October 2009, allowing the appeal, setting aside the judgment of the trial judge and ordering the payment out of court of the $38,000, the following orders are made:
3. In lieu of order 1 of the orders made by the trial judge it is ordered that:
1. The defendants do pay to the plaintiff:
1.1 the sum of $280,625.00 together with the sum of $87,370.48 being interest at the rate of 6 per cent per annum from 1 May 2003 to 9 July 2008, and thereafter $60.49 per day from 9 July 2008 to the date of payment.
1.2 the sum of $4,999.50 together with the sum of $1,444.24 being interest thereon at the rate of 6 per cent per annum from 15 September 2003 to 9 July 2008, and thereafter $1.06 per day from 9 July 2008 to the date of payment.
5. The respondent do pay to the appellants the sum of $59,634.27 plus interest at 6 per cent per annum from 5 June 2009 until 23 October 2009 in the sum of $1,372.41 plus further interest at 6 per cent per annum from 23 October 2009, being $9.80 per day to the date of payment.
6. The respondent do pay to the appellants 80% of their taxed costs of the appeal, save that in respect of the appellants' costs of the issues relating to the orders to be made upon publication of the court's reasons, the respondent do pay the entirety of the appellants' costs to be taxed on an indemnity basis, in that the appellants are to be awarded all costs reasonably incurred which are reasonable in amount.
(Page 11)
- …
8. The costs orders made on 6 May 2009 by the trial judge be set aside and the question of the costs of the trial be remitted to the trial judge for reconsideration in light of the reasons of this court.
9. Liberty to apply within 14 days in relation to whether there should be a stay of any of orders 4, 5 and 7.
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