FEDERAL COURT OF AUSTRALIA
Ringrow Pty Limited v BP Australia Pty Limited
[2006] FCA 1446COSTS – legal costs – whether successful party in litigation able to recover costs as damages under contractual arrangements – effect of curial costs order – interpretation of contractual indemnity - where issues litigated at trial and on appeal differ
CONTRACTS – general contractual principles – construction and interpretation of contracts – interpretation of indemnity providing for recovery of costs
Held – cross-claimant entitled to recovery of costs of defending and cross-claiming in proceedings in Federal Court but not the costs of appeals in the Full Federal Court and High Court; costs recoverable on an indemnity basis and recovery limited to costs incurred ‘properly and in good faith’
Andar Transport Pty Ltd v Brambles Ltd (2004) 217 CLR 424 followed
Ankar Pty Ltd v National Westminster Finance (Australia) Ltd (1987) 162 CLR 549 applied
Cotterell v Stratton (1872) LR 8 Ch App 295 applied
Dryden v Frost (1838) 3 My & Cr 670 at 675 considered
Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79 cited
Elders Trustee & Executor Co Ltd v EG Reeves Pty Ltd (1998) 84 ALR 734 considered
Elders Trustees & Executor to Ltd v Eagle Star Nominees Ltd (1986) 4 BPR 9205 applied
Gomba Holdings (UK) Ltd v Minories Finance Ltd (No 2) [1993] Ch 171 discussed and applied
Maggbury Pty Ltd v Hafele Australia Pty Ltd (2001) 210 CLR 181 applied
Maher v Network Finance Ltd (1986) 4 NSWLR 694 considered
McCann v Switzerland Insurance Australia Ltd (2000) 203 CLR 579 cited
National Provincial Bank of England v Games (1886) 31 Ch D 582 applied
Pan Australia Shipping Pty Ltd v The Ship ‘Comandate’ (No 2) [2006] FCA 1112 considered
Port of Melbourne Authority v Anshun Pty Limited (1981) 147 CLR 589 applied
Potter v Dickenson (1905) 2 CLR 668 considered
Re Shanahan (1941) 58 WN (NSW) 132 considered
Ringrow Pty Ltd v BP Australia Pty Ltd (2004) 209 ALR 32 discussed and explained
Ringrow Pty Ltd v BP Australia Pty Ltd (2005) 222 ALR 306 discussed and explained
Ringrow Pty Ltd v BP Australia Pty Ltd [2003] FCA 1466 considered
Sandtara Pty Ltd v Australian European Finance Corporation Ltd (1990) 20 NSWLR 82 applied
Skalkos v T&S Recoveries Pty Ltd (2004) 65 NSWLR 151 citedWilkie v Gordian Runoff Ltd (2005) 221 CLR 522 cited
RINGROW PTY LIMITED AND ORS v BP AUSTRALIA PTY LIMITED
NSD 766 OF 2006RARES J
7 NOVEMBER 2006
SYDNEY
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
NSD 766 OF 2006
BETWEEN:
RINGROW PTY LIMITED
First ApplicantULTIMATE FUEL PTY LIMITED
Second ApplicantNADER-ONE PTY LIMITED
Third ApplicantJOSEPH NADER
Fourth ApplicantRICHARD NADER
Fifth ApplicantZIAD NADER
Sixth ApplicantROCHELLE NADER
Seventh ApplicantJOSEPH PETER AYOUB
Eighth ApplicantAND:
BP AUSTRALIA PTY LIMITED
Respondent
JUDGE:
RARES J
DATE OF ORDER:
7 NOVEMBER 2006
WHERE MADE:
SYDNEY
THE COURT:
Answers the questions asked…
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- Case
- [2006] FCA 1446
- Decision Date
CaseChat Overview and Summary
The court needed to decide several specific legal questions. Firstly, it had to determine if BP was estopped from claiming costs from Ringrow due to prior cost orders made by the Federal Court. Secondly, the court needed to clarify the scope and limits of the indemnity obligations under clauses A14.2(f) and A16.9(a) of the BP Lansvale POSA. This included whether Ringrow was liable for all costs incurred by BP in specific proceedings and the exercise and execution of the BP Lansvale Option, and if these costs were limited to those that were properly, reasonably, and properly incurred. Additionally, the court had to ascertain if certain individuals, Richard Nader and Rochelle Nader, were also liable to BP under the indemnity provisions of the contract.
The court ruled that BP was not estopped from claiming costs from Ringrow due to the prior Federal Court orders. Regarding the indemnity obligations, the court found that Ringrow was liable to indemnify BP for all costs incurred in specified legal proceedings and in exercising the BP Lansvale Option, provided these costs were properly and reasonably incurred. The court also concluded that Richard Nader and Rochelle Nader were liable to BP under the indemnity provisions of the contract. These findings led to the determination of the categories of costs and the limits of indemnity under the contract.
The final orders of the court directed Ringrow to indemnify BP for the specified costs, subject to the conditions of proper and reasonable incurance. Additionally, Richard Nader and Rochelle Nader were directed to compensate BP for any amounts Ringrow was liable to pay under the indemnity clauses.
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Background
Background to the litigation
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Evidence Before The Court
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Ratio Decidendi
Legal Principle Established
Established by: RARES J
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