Roufeil v Gliderol International Pty Limited (No 2)
[2011] FCA 955
•16 August 2011
FEDERAL COURT OF AUSTRALIA
Roufeil v Gliderol International Pty Limited (No 2) [2011] FCA 955
Citation: Roufeil v Gliderol International Pty Limited (No 2) [2011] FCA 955 Parties: MARK DAMIAN CHARLES ROUFEIL IN HIS CAPACITY AS LIQUIDATOR OF AUSTECH GARAGE DOOR CENTRE PTY LIMITED (IN LIQ) and AUSTECH GARAGE DOOR CENTRE PTY LIMITED v GLIDEROL INTERNATIONAL PTY LIMITED ACN 007 928 949 File number(s): NSD 1111 of 2010 Judge: JAGOT J Date of judgment: 16 August 2011 Catchwords: COSTS – entitlement to indemnity costs – Calderbank offers Cases cited: Calderbank v Calderbank [1975] 3 All ER 333 Date of hearing: 16 August 2011 Place: Sydney Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 8 Solicitor for the Plaintiffs: Mr B Lum of de Mestre & Company Counsel for the Defendant: Mr S Reuben Solicitor for the Defendant: Pitcher Walton Lawyers
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
NSD 1111 of 2010
BETWEEN: MARK DAMIAN CHARLES ROUFEIL IN HIS CAPACITY AS LIQUIDATOR OF AUSTECH GARAGE DOOR CENTRE PTY LIMITED (IN LIQ)
First PlaintiffAUSTECH GARAGE DOOR CENTRE PTY LIMITED
Second PlaintiffAND: GLIDEROL INTERNATIONAL PTY LIMITED ACN 007 928 949
Defendant
JUDGE:
JAGOT J
DATE OF ORDER:
16 AUGUST 2011
WHERE MADE:
SYDNEY
THE COURT:
1.Makes a declaration pursuant to s 588FE of the Corporations Act 2001 (Cth) that the following transactions are voidable:
(a)$17,000 made by the second plaintiff to the defendant on 1 February 2008; and
(b)$4,700 made by the second plaintiff to the defendant on 27 March 2008.
2.Orders that, pursuant to s 588FF of the Corporations Act 2001 (Cth), the defendant is to pay the plaintiffs the sum of $21,700.
3.Orders that, pursuant to s 51A of the Federal Court of Australia Act 1976 (Cth), the defendant is to pay the plaintiffs interest in the sum of $1,911.08.
4.Orders that the defendant is to pay the plaintiff’s costs of the proceeding as agreed or taxed.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
NSD 1111 of 2010
BETWEEN: MARK DAMIAN CHARLES ROUFEIL IN HIS CAPACITY AS LIQUIDATOR OF AUSTECH GARAGE DOOR CENTRE PTY LIMITED (IN LIQ)
First PlaintiffAUSTECH GARAGE DOOR CENTRE PTY LIMITED
Second PlaintiffAND: GLIDEROL INTERNATIONAL PTY LIMITED ACN 007 928 949
Defendant
JUDGE:
JAGOT J
DATE:
16 AUGUST 2011
PLACE:
SYDNEY
REASONS FOR JUDGMENT
On 29 July 2011 I published reasons for decision in this proceeding giving judgment in favour of the plaintiffs, and ordered that the parties bring in short minutes of order to give effect to those reasons. Accordingly, today I made orders declaring certain transactions between the second plaintiff and the defendant to be voidable and ordering the defendant to repay the sums it received under the voidable transactions in the total amount of $21,700. I also made an order for interest to be paid by the defendant to the plaintiffs in the sum of $1,911.08.
The only outstanding issue is that of costs. The plaintiffs seek an order that the defendant pay the plaintiffs’ costs on the usual basis up until 2 February 2011 and on an indemnity basis thereafter. The source of the plaintiffs’ asserted entitlement to indemnity costs is a letter dated 2 February 2011, said to be without prejudice except as to costs. The letter contained an offer – which the plaintiffs relied on as a Calderbank offer (see Calderbank v Calderbank [1975] 3 All ER 333) – to resolve the proceeding on the basis that there be verdict and judgment in favour of the plaintiffs in the amount of $21,700, with each party to pay its own costs. The letter stated that the offer was open for a period of 28 days.
The defendant, for its part, says that it should be subject to an order that it pay 70% of the plaintiffs’ costs on the usual basis. The defendant supports the contention that it should be liable for only 70% of the plaintiffs’ costs on the basis that the plaintiffs’ original claim in their application was for the sum of $30,150. The plaintiffs maintained that claim until 6 July 2011, two business days before the hearing, and then abandoned the claim in the face of undisputed evidence from the defendant’s accounts manager that two cheques in the sum of $8,450 simply had not been received by the defendant. Accordingly, the defendant says that the plaintiffs ultimately obtained only 70% of the amount claimed, the balance having been abandoned.
The defendant also says that there should be no order for indemnity costs, as the proceeding concerned a small claim which could have been run in the local court for less cost. According to the defendant, the so-called Calderbank offer does not create any presumption in relation to costs because it did not constitute a true offer of compromise, being in the amount of $21,700 which, in truth, was the totality of the plaintiffs’ claim. The plaintiffs maintain that the letter did contain a genuine offer of compromise because it agreed to waive interest and proposed that the agreement be on the basis that each party pay its own costs.
Both parties accept that I have a discretion in relation to costs which is a broad one, albeit to be exercised judicially.
I consider that the circumstances of this case, including the letter of 2 February 2011, are not such as would warrant an order for indemnity costs in favour of the plaintiffs. As the defendant has submitted, this matter concerned a very small claim and, in truth, after the evidence was filed there was no basis for the plaintiffs to maintain their claim for some $30,000. As at 2 February 2011, the plaintiffs’ real claim was for only $21,700; thus, even though the offer made in the plaintiffs’ letter did not include any payment of interest or payment of costs, the plaintiffs by that letter were seeking a full payment of their claimed entitlement. In those circumstances, having regard to the context of the whole proceedings, I am not minded to exercise my discretion in favour of the plaintiffs to make an order for indemnity costs.
On the other hand, there is no real reason in the proceeding to deduct 30% of the plaintiffs’ ordinary costs. In effect, the plaintiffs were successful in the claim pursued at trial, and it is not apparent to me that there is any proper basis for making a deduction.
Accordingly, the defendant should pay the plaintiffs’ costs of the proceeding as agreed or taxed.
I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jagot. Associate:
Dated: 16 August 2011
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