Ramadan v ACN 098 408 176 Pty Ltd & Anor (No 3) - [2024] SASCA 19

SUPREME COURT OF SOUTH AUSTRALIA
(Court of Appeal: Civil)
RAMADAN v ACN 098 408 176 PTY LTD & ANOR (No 3)
[2024] SASCA 19
Judgment of the Court of Appeal
(The Honourable President Livesey, the Honourable Justice Doyle and the Honourable Justice Bleby)
5 March 2024
APPEAL AND NEW TRIAL - PROCEDURE - SOUTH AUSTRALIA - POWERS OF COURT - OTHER MATTERS
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - INTEREST ON COSTS
Following the delivery of reasons in Ramadan v ACN 098 408 176 Pty Ltd & Anor [2023] SASCA 91 and the consideration of further submissions and the subsequent delivery of further reasons in Ramadan v ACN 098 408 176 Pty Ltd & Anor (No 2) [2023] SASCA 91, the Court received and considered written submissions from the parties addressing the award of interest to be made.
The appellant’s contentions:
1.It was necessary for the Court to exercise its discretion afresh when determining the award of pre-judgment interest.
2. Interest should be calculated having regard to the dates when payments were made towards the obligations arising under the 2008 Loan and the rates specified over time for pre-judgment interest under the former rules of court. Interest should be awarded in the sum of $126,000 in addition to post-judgment interest, or $162,000.
The respondents’ contentions:
1.The appellant is bound by the manner in which she conducted her case at trial and on appeal.
2.There was no ground of appeal, nor any submission made on appeal, which challenged the award of lump sum interest made by the trial judge in the sum of $30,000.
3.However, the appellant has not personally been held out of her money because a significant portion of the damages award reflects payments made by her grandson in connection with a family arrangement and, at least to that extent, there should be no allowance for interest.

Held (the Court) awarding a lump sum in lieu of pre-judgment interest in favour of the appellant in the amount of $60,000, and determining that post-judgment interest will run on the entire judgment from 11 May 2021:
1.The judgment under appeal included a component for interest. That judgment must be set aside and a new judgment entered. It is not necessary for the appellant to identify error in connection with the award of interest in accord with House v King (1936) 55 CLR 499 as this Court must approach the question of interest afresh.
2.The applicable rules are the Uniform Civil Rules 2020 (SA), not the former rules. The approach of the trial judge and the conduct of the parties at trial and on appeal should be taken into consideration by this Court when determining interest afresh.
3.The purpose of an award of pre-judgment interest is to compensate an applicant for having been kept out of her award. The determination of an award of interest involves the exercise of an evaluative judgment akin to the exercise of a discretion. Some interest allowance should be made on the damages component reflecting the payments made on behalf of the appellant by her grandson. The exercise of discretion to proceed by way of a lump sum has not been challenged.
4.The lump sum award in lieu of interest under s 30C(3) of the Supreme Court Act 1935 (SA) should commence with the determination made by the trial judge and be increased to reflect the increase in damages. Observations made about post-judgment interest under s 114 of the Supreme Court Act 1935 (SA). Post-judgment interest on the whole award should run from the date of the earlier judgment, being 11 May 2021.

Supreme Court Act 1935 (SA) ss 30C(1), 30C(2), 30C(3), 114; Supreme Court Act 1867 s 33; Supreme Court Civil Supplementary Rules 2014 (SA) r 208; Uniform Civil Rules 2020 (SA) rr 1.4, 182.3, 185.1, referred to.
Chakravarti v Advertiser Newspapers Ltd (1998) 72 SASR 361; Chakravarti v Advertiser Newspapers Ltd (1996) 65 SASR 527; Conroy’s Smallgoods Pty Ltd v Channel Seven Adelaide Pty Ltd (2007) 97 SASR 14; Gould v Vaggelas (1985) 157 CLR 215; Grincelis v House (2000) 201 CLR 321; Haines v Bendall (1991) 172 CLR 60; House v The King (1936) 55 CLR 499; Landmark Operations Limited v J Tiver Nominees Pty Ltd & Ors (No 3) [2009] SASC 329; MBP (SA) Pty Ltd v Gogic (1991) 171 CLR 657; Mercantile Credits Ltd v Buckeridge [1986] WAR 149; Nicholson v Nicholson (No 2) (1995) 20 MVR 186; Nicol v Allyacht Spars (1988) 165 CLR 306; Nitrate Producers SS Co Ltd v Short Bros Ltd [1922] All ER 710; Osborne v Kelly (1999) 75 SASR 392; Poniatowska v Channel Seven Sydney Pty Ltd (No 3) [2020] SASCFC 37; Ramadan v ACN 098 408 176 Pty Ltd & Anor [2023] SASCA 91; Ramadan v ACN 098 408 176 Pty Ltd & Anor (No 2) [2024] SASCA 6; Reis v Carling (1908) 5 CLR 673; Screenco Pty Ltd v RL Dew Pty Ltd (2003) 58 NSWLR 720; Selecta Homes and Building Company Pty Ltd v Advertiser-News Weekend Publishing Company Pty Ltd (2001) 79 SASR 451; Trevorrow v State of South Australia (No 6) [2008] SASC 4; Thompson v Faraonio (1979) 24 ALR 1; Wheeler v Page (1982) 31 SASR 1, considered.

RAMADAN v ACN 098 408 176 PTY LTD & ANOR (No 3)
[2024] SASCA 19
Court of Appeal – Civil: Livesey P, Doyle and Bleby JJA
THE COURT:
Introduction

On 31 August 2023, this Court determined that the appellant succeeded on one of her two grounds of appeal and that the respondents failed on their two grounds of cross-appeal.[1] The Court gave the parties an opportunity to put submissions on whether there was an alternative damages case available, notwithstanding that the appellant failed on her claim for damages based on her loss of the survivorship interest in the Woodville property under appeal ground 2.
[1] Ramadan v ACN 098 408 176 Pty Ltd & Anor [2023] SASCA 91. In these reasons, as with the primary reasons, reference will continue to be made to “the respondents” even though only the second respondent appeared.
Following the receipt of further submissions, this Court provided further reasons addressing a number of matters including the rejection of the claim that there was an alternative damages case available to the appellant under appeal ground 2. The Court invited the parties to agree the question of interest.[2] The parties were unable to agree the proper allowance for interest and, during February 2024, the Court received further written submissions from the parties. These reasons address the award of interest which will be made.
[2] Ramadan v ACN 098 408 176 Pty Ltd & Anor (No 2) [2024] SASCA 6.
The case for the appellant on interest
The appellant contends that it is necessary for the Court to exercise its discretion afresh when determining the award of pre-judgment interest having regard to the dates when payments were made towards the obligations arising under the 2008 Loan and the rates specified for pre-judgment interest under the relevant rules of court.
The appellant seeks an award in respect of interest totalling just over $126,000 to 11 May 2021, when judgment was entered by the trial judge. Thereafter, the appellant seeks post-judgment interest on that amount. Alternatively, the appellant seeks pre-judgment interest calculated to the date of any final orders made by this Court, which the appellant calculates at just under $162,000.
The case for the respondents on interest
The respondents contend that the appellant is bound by the manner in which she conducted her case at trial and on appeal. It is submitted that there was no ground of appeal, nor any submission made on appeal, which challenged the award of lump sum interest made by the trial judge.
In the exercise of his discretion, the trial judge awarded interest by way of a lump sum in the amount of $30,000. As the appellant’s damages recovery has been doubled, it is contended that the appropriate allowance for interest should likewise be increased.
The respondents contend that it is relevant that a significant portion of the damages award was paid by the appellant’s grandson pursuant to a family arrangement, not by her. The respondents contend that, in those circumstances and at least to that extent, the appellant has not personally been held out of her money and that this must be reflected in the interest award which is made.
The determination of the pre-judgment interest award
The order made by the primary judge was that judgment be entered in favour of the appellant in the amount of $152,502, inclusive of interest. That reflected a damages component of $122,502 and, as earlier mentioned, a lump sum award in respect of interest of $30,000. The effect of the determination made by this Court is that the earlier judgment must be set aside, the appellant’s damages allowance doubled to $245,004, which sum is in addition to interest, and a new judgment entered.[3]
[3] Ramadan v ACN 098 408 176 Pty Ltd & Anor [2023] SASCA 91, [209].
Pursuant to s 30C(1) of the Supreme Court Act 1935 (SA), the court will include in a judgment concerning an award of damages, compensation or any other pecuniary amount, an award of interest “unless good cause is shown to the contrary”. By s 30C(2) interest is to be determined at a rate which is fixed by the court and for a period which is fixed by the court. The period is, unless the court otherwise determines, “when the liability to pay the amount of the claim fell due to the date of judgment”. Interest is payable, in accordance with the court’s determination, in respect of the whole or part of the amount for which judgment is given.
Importantly, however, where a party is entitled to interest under s 30C, by s 30C(3) the court may, in the exercise of its discretion, “and without proceeding to calculate the interest to which that party may be entitled in accordance with subsection (2) of this section, award a lump sum in lieu of that interest”.
Before the trial judge and this Court, the appellant contended that the applicable rules were the Supreme Court Civil Supplementary Rules 2014 (SA). In that respect, it is pertinent to observe that the appellant at trial pressed for a single rate of interest over the entire award for the period 2008 to 2020. By contrast, the appellant now contends there are various applicable rates of interest and that the award must be calculated by reference to the rate applicable at the time of each monthly repayment made under the 2008 Loan. Detailed schedules have been supplied.
In the course of his reasons delivered on 11 May 2021, the trial judge found that r 182.3 of the Uniform Civil Rules 2020 (SA) governed the action, not r 208 of the Supreme Court Civil Supplementary Rules 2014 (SA). Whilst not made explicit, it is clear that his Honour had in mind r 1.4 of the Uniform Civil Rules 2020 (SA), which commenced operation on 18 May 2020.[4] Sub-rule 1.4(1) provides:
(1)     Unless the Court otherwise orders—
(a)     these Rules apply to—
(i)    a proceeding commenced; and
(ii)     a step in a proceeding taken,
on or after the commencement date; and
(b)     the Previous Rules continue to govern a step in a proceeding taken before the commencement date.
[4]     South Australian Government Gazette, 18 May 2020, page 1425.
As the trial judge was addressing costs and interest claims made during May 2021, after the commencement date of 18 May 2020, it was appropriate to regard each of these as a “step in a proceeding taken … after the commencement date”. It follows that the appellant’s reliance on the earlier rules must be rejected.
Speaking generally, where the appeal court finds error in the assessment of damages and substitutes a different award, the earlier judgment is set aside, including any interest component included in the judgment under appeal. It follows that it is usually necessary to reconsider any award of interest forming part of the judgment when determining what substituted judgment should be entered on appeal.[5] It is necessary that this Court approach the question of interest afresh. It is not necessary for the appellant to identify error in accord with House v The King.[6]
[5] Conroy’s Smallgoods Pty Ltd v Channel Seven Adelaide Pty Ltd (2007) 97 SASR 14, [273] (Perry J); Chakravarti v Advertiser Newspapers Ltd (1996) 65 SASR 527; Chakravarti v Advertiser Newspapers Ltd (1998) 72 SASR 361, 370.
[6] House v The King (1936) 55 CLR 499, 504-505 (Dixon, Evatt and McTiernan JJ).
Whilst it is necessary to determine the award of interest afresh, that is not to say that the approach taken by the trial judge is irrelevant. Similarly, the approach taken by the parties before the trial judge is not irrelevant either. No considered criticism has been made of his Honour’s reliance upon the Uniform Civil Rules (2020) (SA), nor of his exercise of discretion to proceed by way of a lump sum award in lieu of interest. The conduct of the parties at trial and on appeal should be taken into consideration by this Court when determining interest.
The trial judge found that the appropriate rate for the determination of interest was 5 per cent under the current rules, not the rate of 6.8 per cent under the earlier rules. Moreover, the trial judge considered the relevant calculations had to be adjusted to reflect that the full amount of the appellant’s award was not owing for the entire period because it reflected payments made between 2009 and 2016. His Honour also took into account that the applicant had made payments exceeding $120,000, primarily from her pension and savings, and that her grandson had made payments on her behalf in amounts exceeding $117,000. The trial judge concluded:[7]
The provisions of s 30C of the Supreme Court Act permit the Court to award a lump sum in the exercise of its discretion. That can be done without the need to make a formal calculation. Having regard to the matters discussed above, I am satisfied that it is appropriate to award the applicant lump sum interest in the amount of $30,000.
[7] Ramadan v ACN 098 408 176 Pty Ltd & Anor, unreported decision delivered 11 May 2021, [14].
The purpose of an award of pre-judgment interest is to compensate an applicant for having been kept out of her award.[8] It may be accepted that the determination of an award of interest involves the exercise of an evaluative judgment akin to the exercise of a discretion.[9] Nonetheless, the Court must also be astute to ensure that an applicant is not over-compensated and artificial arguments should be avoided:[10]
It is undesirable that the question of interest should give rise to lengthy argument about the selection of a date which will fairly compensate a plaintiff. The power to award a lump sum would inject some flexibility into the process which would avoid artificial arguments over the choice of a date.
[8] Wheeler v Page (1982) 31 SASR 1, MBP (SA) Pty Ltd v Gogic (1991) 171 CLR 657, 663 and Haines v Bendall (1991) 172 CLR 60, 66.
[9] Trevorrow v State of South Australia (No 6) [2008] SASC 4, [12].
[10] Osborne v Kelly (1999) 75 SASR 392, [68] (Doyle CJ) (a case of interest on costs); Screenco Pty Ltd v RL Dew Pty Ltd (2003) 58 NSWLR 720, [41] (Handley JA).
In support of their proposition that matters that might be regarded as irrelevant to the assessment of damages may nevertheless be relevant to the appropriate award of interest, including whether the party claiming interest suffered a real and practical loss, the respondents relied upon Screenco Pty Ltd v RL Dew Pty Ltd.[11] On this basis, we accept that it was appropriate for the trial judge to take into account the practical reality that payments were made by the grandson when awarding interest. On the other hand, even though the appellant was not “out of pocket” to the extent of those payments, she has been kept out of her award which included an allowance for those payments. In a somewhat analogous context, interest has been awarded in respect of gratuitous services notwithstanding that the applicant in those cases is never “out of pocket”. Indeed, interest on damages for gratuitous services has been awarded at commercial rates, notwithstanding some misgivings expressed about that from time to time.[12] In the circumstances, some allowance should be made for the component reflected in the amounts paid by the appellant’s grandson.
[11] Screenco Pty Ltd v RL Dew Pty Ltd (2003) 58 NSWLR 720, [41]-[47] (Handley JA), [56] (Sheller JA), [90] (Tobias JA).
[12] Grincelis v House (2000) 201 CLR 321.
A further consideration concerns the period for which interest should be allowed. The appellant seeks a combination of pre-judgment and post-judgment interest. Obviously enough, the rate applicable to post-judgment interest is usually higher than that which is applicable to pre-judgment interest. That reflects the court’s disapproval of the failure by a respondent to meet the order for payment inherent in the judgment of the court.[13]
[13] The rate for post-judgment interest is set by r 185.1(1) of the Uniform Civil Rules 2020 (SA) at 6 per cent per annum. The post-judgment rate was described as a “higher rate to encourage prompt payment” in Poniatowska v Channel Seven Sydney Pty Ltd (No 3) [2020] SASCFC 37, [10] (Kourakis CJ, Blue and Nicholson JJ).
The orthodox approach is that the new judgment must take effect – or “speak” – from the date of the earlier judgment, being 11 May 2021.[14] On that approach pre-judgment interest is allowed to that date and, thereafter, a claim for post‑judgment interest arises under s 114 of the Supreme Court Act 1935 (SA).[15]
[14] Chakravarti v Advertiser Newspapers Ltd (1998) 72 SASR 361, 379 (Doyle CJ and Perry J), citing Nitrate Producers SS Co Ltd v Short Bros Ltd [1922] All ER 710, 712 (Lord Buckmaster), Nicol v Allyacht Spars (1988) 165 CLR 306, 311-312 (Mason CJ, Brennan, Dawson, Toohey, Gaudron JJ), Gould v Vaggelas (1985) 157 CLR 215, 274.
[15] Chakravarti v Advertiser Newspapers Ltd (1998) 72 SASR 361, 379-380 (Doyle CJ and Perry J). Cf, Poniatowska v Channel Seven Sydney Pty Ltd (No 3) [2020] SASCFC 37, [11]-[12] (Kourakis CJ, Blue and Nicholson JJ) where a different approach was taken because the claim failed at trial and the judgment only “spoke” from the date it was entered in the Full Court. There was no opportunity to pay the judgment before that date.
To conclude, no attempt has been made to challenge the approach taken by the trial judge to the determination of interest at the trial. The exercise of discretion to award a lump sum in lieu of interest has not been challenged, nor has it been explained why that approach should not now be taken. As might be obvious, his Honour had the carriage of the litigation for a considerable period and was well‑placed to assess the relevant considerations in the exercise of his broad discretion. The trial judge in this case was clearly concerned that the award of interest should not be permitted to over-compensate the applicant.
Accordingly, whilst an interest award should be made, the interests of justice and the circumstances of this case warrant an award being made on a lump sum basis in lieu of interest as the trial judge determined. As with lump sum cost orders, there will usually be a range of reasons warranting the exercise of discretion to award a lump sum in lieu of interest. They will include cases where the allowance is modest and straightforward, or where, as here, there are a range of factors which suggest that a strictly arithmetic calculation may not be appropriate. These included any delays encountered and the reasons for those delays, together with the approach taken by the parties to the conduct of the litigation generally.
And, as can be seen from the reasons of this Court and the trial judge, there were “family arrangements” entered into between the appellant and her family concerning the Woodville property and the required repayments which do not appear to have been fully revealed to the trial judge. That seems to have been regarded by the trial judge as a relevant factor to take into account which has not been challenged.

Finally, this is not a case in which it is appropriate to proceed other than on a broad basis when determining the award by way of a lump sum in lieu of interest.
This Court commences with the award made by the trial judge, adjusted to reflect the decision made by this Court to double the damages award under appeal ground 1. In all of the circumstances of this case, an appropriate lump sum award in lieu of interest to 11 May 2021 is, we think, the sum of $60,000.
Post-judgment interest
Usually, and subject only to whether a “period of grace” is permitted, the end of the period for which pre-judgment is interest is awarded marks the beginning of the period for which post-judgment interest is recovered.
At common law, a judgment did not carry interest. The right to post-judgment interest was first conferred by statute in England in 1837 and in South Australia by s 33 of the Supreme Court Act 1867. It is now addressed by s 114 of the Supreme Court Act 1935 (SA).[16] By s 114(1), the rate is as specified in the rules of court, and by s 114(2) post-judgment interest is computed “from the time specified in the judgment or order”.
[16] Landmark Operations Limited v J Tiver Nominees Pty Ltd & Ors (No 3) [2009] SASC 329, [7] (Judge Lunn), citing Reis v Carling (1908) 5 CLR 673, 676-678 (Griffiths CJ).
At the outset there are four relevant considerations. First, whilst we were told that the respondents paid the initial award of $152,502, inclusive of interest, into the Suitor’s Fund on 21 July 2022, we were not told whether this was pursuant to any arrangement entered into regarding satisfaction of the initial judgment which became due on 11 May 2021. The respondents consent to the payment out of that amount to the appellant, together with interest. Post-judgment interest on that portion, reduced by the interest earned in the Suitor’s Fund, [17] would usually run from 11 May 2021 until the appellant receives the judgment sum. Second, a proportion of the period between 11 May 2021 and the date of any order made by this Court should be attributed to the need to adjourn the first hearing date of the appeal in circumstances where we have intimated that the appellant should pay the costs thrown away associated with that adjournment. Ordinarily, interest should not run during that period. Third, and as a matter of practicality, it was not open to the respondents to meet the entirety of the judgment which will now be entered in the sum of $305,004, inclusive of interest of $60,000, until judgment is entered in this Court. That is to say, to award post-judgment interest over the whole judgment for the whole of the period might “lead to a situation where the respondent would be required to pay post-judgment interest at the higher rate over an appreciable period during which it had no realistic opportunity to discharge the judgment debt”.[18]
[17] Which may be treated as a form of part payment, Mercantile Credits Ltd v Buckeridge [1986] WAR 149.
[18] Poniatowska v Channel Seven Sydney Pty Ltd (No 3) [2020] SASCFC 37, [12] (Kourakis CJ, Blue and Nicholson JJ).
Finally, post-judgment interest is usually recovered automatically and without the need for an order in accord with the terms of s 114 of the Supreme Court Act 1935 (SA).[19] Where a party seeks a date different to the date of final judgment, it is necessary for that party to make an application under s 114(2). In this case the respondents contend that no order should be made, with the result that post-judgment interest will only run from the date of this Court’s order. By contrast, the appellant contends that post-judgment interest should run from the date of the trial judge’s order.
[19] Poniatowska v Channel Seven Sydney Pty Ltd (No 3) [2020] SASCFC 37, [15] (Kourakis CJ, Blue and Nicholson JJ).
The usual practice is, as mentioned, that the substituted judgment operates from the date of the judgment at first instance. That was described by Doyle CJ and Perry J as “the practice of this Court” in Chakravarti v Advertiser Newspapers Ltd.[20] The position is different where no award was earlier made.[21] In this case it is appropriate that the usual practice be applied. Post-judgment interest should run from the date of the earlier judgment, being 11 May 2021.
[20] Chakravarti v Advertiser Newspapers Ltd (1998) 72 SASR 361, 380 (Doyle CJ and Perry J). See also Nicholson v Nicholson (No 2) (1995) 20 MVR 186, 189 (Kirby P, with whom Mahoney and Meagher JJA agreed). See also Selecta Homes and Building Company Pty Ltd v Advertiser-News Weekend Publishing Company Pty Ltd (2001) 79 SASR 451, [1] (Doyle CJ), [111]-[112], [120] (Lander J), [192] (Gray J). In Thompson v Faraonio (1979) 24 ALR 1, 8 (Privy Council) Lord Fraser of Tullybelton said, “The proper terminus ad quem for calculating interest is the date of the judgment of the court of first instance”.
[21] Poniatowska v Channel Seven Sydney Pty Ltd (No 3) [2020] SASCFC 37, [11]-[12] (Kourakis CJ, Blue and Nicholson JJ).
In addition to the considerations earlier outlined, which have been taken into account, three further points may be made. The first is that although the respondent was unaware of the extent of the increased award until it received the reasons of this Court, the appellant has been kept out of her award and would in any event be entitled to compensation for the delay to final payment with a corresponding increase in pre-judgment interest. Second, although there is a short period in which delay can be attributed to the appellant, the allowance to be made for that is, in overall terms, modest. Finally, and perhaps most importantly, it is appropriate to stand back and consider the allowance which is made for the delay in payment as a whole, whether the allowance be by way of pre-judgment or post-judgment interest. It must be remembered that these allowances must be approached broadly but judicially. Fairness in the circumstances of this case involves the balancing of competing interests. Whilst the respondents might question the date for post‑judgment interest, the appellant might well have questioned the approach to a lump sum in lieu of pre-judgment interest. Were the date for post-judgment interest to be adjusted, that may have warranted an adjustment to the approach taken by the trial judge to pre-judgment interest to 11 May 2021. As it is, when these allowances are considered as a whole they may be regarded as fair and reasonable.
Conclusion
There will be a lump sum award in lieu of pre-judgment interest in favour of the appellant in the sum of $60,000 to 11 May 2021. Post-judgment interest will run on the whole of the judgment from that date.
The parties must now bring in minutes of order reflecting the terms in which judgment should finally be entered. They have liberty to apply.