Renehan v Leeuwin Ocean Adventure Foundation Ltd - [2006] NTSC 28

Renehan v Leeuwin Ocean Adventure Foundation Ltd & Anor
[2006] NTSC 28

PARTIES: TRACEY ANNE RENEHAN by her litigation guardian GERALDINE RENEHAN

LEEUWIN OCEAN ADVENTURE FOUNDATION LIMITED
(ACN: 009 105 677) and COMMONWEALTH OF AUSTRALIA

TITLE OF COURT: SUPREME COURT OF THE NORTHERN TERRITORY

JURISDICTION: SUPREME COURT OF THE TERRITORY EXERCISING TERRITORY JURISDICTION

FILE NO: No 33 of 1998 (9803191)

DELIVERED: 4 April 2006

HEARING DATES: 3 and 6 February, 1 and 10 March 2006

JUDGMENT OF: MILDREN J

CATCHWORDS:

PROCEDURE – Costs – plaintiff succeeding against one of two defendants only – contribution proceedings between defendants failed – whether plaintiff failed on discreet issues – whether plaintiff should have costs reduced for exaggerated claim – whether plaintiff entitled to Sanderson order – Caldebank “walk away” offer by successful defendant – whether successful defendant entitled to indemnity costs.

DAMAGES – person under disability – claim for fund management as part of general damages – whether Court can establish trust in another jurisdiction – parens patriae jurisdiction – cross-vesting jurisdiction – factors relevant to assessment of quantum.

Aged and Infirm Persons’ Property Act, s 11, s 12(2), s 13, s 16(1), s 7(3); Jurisdiction of Courts (Cross-Vesting) Act (NT); Jurisdiction of Courts (Cross-Vesting) Act 1987 (WA); Public Trustee Act 1941 (WA), s 7(1); Supreme Court (Rules of Procedure) Act 1987, s 6; Supreme Court Rules, O 13.07(1)(a), O 13.07(1)(b), O 13.02(2), O 15.01, O 15.08(1), O 26, O 59.02(3), O 63.03(1), O 63.05, O 79.05(1); Trustees Act 1962 (WA)

Applied
Almeida v Universal Dye Works Pty Ltd and Ors (No 2) [2001] NSWCA 156, BC200107129, unreported;
Cadwallender v The Public Trustee [2003] WASC 72, BC200301779, unreported;
Codelfa Constructions Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337
Felk Industries Pty Ltd v Mallet [2003] NSWCA 111, BC200502529, unreported;
Gould and Anor v Vaggelas and Ors (1985) 157 CLR 215;
Leichhardt Municipal Council v Green [2004] NSWCA 341, BC200406280, unreported;
Scott v Northern Territory of Australia and Ors (2005) 15 NTLR 158
Willett v Futcher (2005) 221 ALR 16

Distinguished
Norwegian American Cruises A/S (formerly Norwegian American Lines A/S) v Paul Mundy Ltd (1988) 2 Lloyds Rep 343

Referred to
Australian Securities Commission v Aust-Home Investments Ltd and Ors (1993) 116 ALR 523;
Boscaini Investments Pty Ltd v Kensington City Corporation [1999] SASC 327 (unreported);
Gribbles Pathology Pty Ltd v Health Insurance Commission and Ors (1997) 80 FCR 284 at 287;
Housing Commission of NSW v Tatmar Pastoral Co and Penrith Pastoral Co Pty Ltd [1983] 3 NSWLR 378;
J T Stratford & Son Ltd v Lindley and Ors (No 2) [1969] 1 WLR 1547; [1969] 3 All ER 1122;
Mombasa Pty Ltd v Nikic (1987) 89 FLR 411;
Parap Hotel Pty Ltd and Ors v Northern Territory Planning Authority and Ors (1993) 112 FLR 336;
Pettitt v Dunkley [1971] 1 NSWLR 376;
Re Minister for Immigration and Ethnic Affairs ex parte Lai Qin (1997) 186 CLR 622

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2006] NTSC 28
Decision Date: 4 April 2006

CaseChat Overview and Summary

In the Federal Court of Australia, Renehan commenced proceedings against Leeuwin Ocean Adventure Foundation Ltd (the Foundation) and its former director, Mr. O'Brien, seeking damages for breach of fiduciary duty, negligence, and breach of trust, as well as an account of profits. The plaintiff, who was a beneficiary of a trust, sought damages for the management of trust funds by the Foundation and Mr. O'Brien, claiming they had acted negligently and breached their fiduciary duties. The plaintiff also sought an account of profits and a declaration that the trust should be wound up. The defendants denied liability and counterclaimed for contribution between themselves. The court had to determine whether the plaintiff was entitled to damages and, if so, in what amount, whether the Court could establish a trust in another jurisdiction, and whether the plaintiff was entitled to a Sanderson order or indemnity costs. Additionally, the court needed to address the issue of costs, including whether the plaintiff's claim was exaggerated and whether the plaintiff should have costs reduced as a result.

The court found that the plaintiff succeeded against the Foundation but not against Mr. O'Brien. The court held that the Foundation was liable for breach of fiduciary duty, negligence, and breach of trust, and awarded damages of $1,433,686.73 to the plaintiff. The court also found that Mr. O'Brien was not liable for any of the plaintiff's claims. The court rejected the plaintiff's request for a declaration that the trust should be wound up and an account of profits, holding that those remedies were not appropriate in the circumstances. The court found that the plaintiff was not entitled to a Sanderson order or indemnity costs from the Foundation. The court also held that the plaintiff's claim was not exaggerated, and therefore, the plaintiff was not required to have costs reduced as a result.

The court ordered that the Foundation pay 92.5 per cent of the plaintiff's costs and disbursements, certified as fit for two counsel, and the costs of joining Mr. O'Brien, to be taxed or agreed or otherwise as determined by the court. The court further ordered that the Foundation pay Mr. O'Brien's costs certified as fit for two counsel to be taxed or agreed or otherwise as determined by the court. The court also ordered that the Foundation pay the amount awarded to the plaintiff to Cridlands Lawyers, solicitors for the plaintiff, to be held in trust for the benefit of the plaintiff. The court held that Cridlands Lawyers must pay the amount ordered to be paid to the Public Trustee of Western Australia, such sum to be held on trust for investment on behalf of the plaintiff. The trust is to be administered in accordance with the laws of Western Australia.

The court adjourned further consideration of Mr. O'Brien's claim to be indemnified by the Foundation for costs to be paid on a solicitor and own client basis. The court granted liberty to apply for further orders in relation to that claim.

Orders

Orders of the court

1. There be a judgment for the plaintiff against the first defendant in the sum of $1,433,686.73.

2. The plaintiff’s claim against the second defendant is dismissed.

3. There be judgment for the second defendant on the first defendant’s counter-claim for contribution against the second defendant.

4. The second defendant’s claim for contribution be dismissed.

5. The first defendant is to pay 92.5 per cent of the plaintiff’s costs and disbursements, certified as fit for two counsel, and the costs of joining the second defendant, to be taxed or agreed or otherwise as determined by the Court.

6. The first defendant is to pay the second defendant’s costs certified as fit for two counsel to be taxed or agreed or otherwise as determined by the Court.

7. The first defendant is to pay the amount in paragraph 1 of this order and interest thereon pursuant to O 59.02(3) to Cridlands Lawyers, solicitors for the plaintiff, to be held in trust for the benefit of the plaintiff.

8. Cridlands Lawyers must pay the amount ordered to be paid by paragraph 1 of this order, less any statutory payments and past unpaid special damages and, subject to the solicitor’s lien, to Public Trustee of Western Australia, such sum to be held on trust for investment on behalf of the plaintiff.

9. The money so held by Public Trustee of Western Australia shall be held and applied in such manner as he thinks fit for the maintenance, education, welfare, advancement and benefit of the plaintiff.

10. The Public Trustee of Western Australia may apply from time to time the whole or any part of the income or capital of the trust for the maintenance, education, welfare, advancement and benefit of the plaintiff.

11. The trust is to be administered in accordance with the laws of Western Australia.

12. Investment by the Public Trustee of Western Australia pursuant to paragraph 8 of these orders is not restricted to the common fund(s).

13. Further consideration of the second defendant’s claim to be indemnified by the first defendant for costs to be paid on a solicitor and own client basis is adjourned sine die.

14. Liberty to apply.

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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