GLEESON CJ, GAUDRON, GUMMOW, KIRBY, HAYNE AND CALLINAN JJ
ALEXANDER GARNET ROXBOROUGH & ORS APPELLANTS
AND
ROTHMANS OF PALL MALL AUSTRALIA LIMITED RESPONDENT
Roxborough v Rothmans of Pall Mall Australia Limited [2001] HCA 68 6 December 2001 S199/2000
ORDER
1. Appeal allowed with costs.
2.Set aside orders of the Full Court of the Federal Court made on 11 November 1999.
3. In place thereof, order that:
(a) the appeal to that Court be allowed with costs;
(b) the orders of Emmett J made on 18 February 1999 be set aside; and
(c) in place of the orders of Emmett J, there be:
(i)judgment entered for the first appellant in the sum of $14,377.33; for the second appellant for $11,017.12; for the third appellant for $18,521.99; for the fourth appellant for $31,716.32; for the fifth appellant for $15,622.98; for the sixth appellant for $35,877.19; and for the seventh appellant for $26,456.55;
(ii)an order that the respondent pay the appellants' costs of the action; and
(iii)liberty to apply to a Judge of the Federal Court for an order for interest under s 51A of the Federal Court of Australia Act 1976 (Cth).
On appeal from the Federal Court of Australia
Representation:
S J Gageler SC with R A Dick for the appellants (instructed by Glasheen & Quilty)
B W Walker SC with I M Jackman for the respondent (instructed by Clayton Utz)
Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.
CATCHWORDS
Roxborough v Rothmans of Pall Mall Australia Limited
Contract – Money had and received – Total failure of consideration – Contract between wholesaler and retailers – Wholesale cost included cost of goods plus tax identified as tobacco licence fee – Tax a distinct part of consideration paid by retailers – Tax held invalid so wholesaler not liable to pay tax collected from retailers – Retailers sought repayment of money for tax as a result of failure of consideration – Whether wholesaler had title to retain the money – Whether failure of the tax involved a failure of a distinct and severable part of the consideration.
Restitution – Recovery – Unjust enrichment – Contract between wholesaler and retailers – Wholesale cost included indirect tax held to be invalid – Whether wholesaler had a duty to make restitution to the retailers – Whether enrichment was at the expense of the retailers who had passed the tax on to consumers and the consumers were unlikely to claim the tax back – Whether unjust enrichment must be at the expense of the party seeking to recover – Whether passing on is a defence to a claim for recovery.
Contract – Implied terms – Test for implying a term – Contract between wholesaler and retailers – Wholesale cost included cost of goods plus tax – Tax held invalid – No express agreement about what would happen if the tax was held to be invalid – Whether such an…
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.
Continue reading Roxborough v Rothmans of Pall Mall Australia Ltd
Sign in free to access the full text
Details
AGLC
Roxborough v Rothmans of Pall Mall Australia Ltd [2001] HCA 68
Case
[2001] HCA 68
Decision Date
CaseChat Overview and Summary
The case of *Roxborough v Rothmans of Pall Mall Australia Ltd* involved a dispute between retailers (appellants) and a wholesaler, Rothmans (respondent). The retailers sought the repayment of money paid to Rothmans, which represented a tobacco licence fee that had been declared invalid. The wholesale cost of goods included this fee, and the retailers argued that because the fee was invalid, there had been a total failure of consideration for that portion of the payment, entitling them to recover the money. The matter was heard by the High Court of Australia.
The central legal issues before the High Court were whether the invalidity of the tobacco licence fee constituted a failure of a distinct and severable part of the consideration paid by the retailers, and consequently, whether Rothmans held the money received for the fee to the use of the retailers. The court also considered whether the retailers had suffered a loss that could be recovered, particularly in light of the fact that they had passed the cost of the invalid tax onto consumers, who were unlikely to claim it back. This raised questions about unjust enrichment and whether the enrichment must be directly at the expense of the party seeking recovery.
The High Court reasoned that the tobacco licence fee, although part of the overall wholesale price, was a distinct and severable component of the consideration. The invalidity of the fee meant that the purpose for which that specific part of the payment was made had failed. The court applied the principle that where a contract includes a payment for a specific purpose, and that purpose fails due to illegality or invalidity, the money paid for that purpose is recoverable under the action for money had and received, even if other parts of the contract remain valid. The court found that Rothmans had received the money for the invalid licence fee under circumstances where it was not entitled to retain it, and that the retailers had a right to recover it.
The High Court allowed the appeal, setting aside the orders of the Federal Court. It ordered that judgment be entered for each of the appellant retailers for specific sums representing the amounts paid for the invalid licence fee, and that Rothmans pay the appellants' costs of the action.
Orders
Orders of the court
1. Appeal allowed with costs.
2. Set aside orders of the Full Court of the Federal Court made on 11 November 1999.
3. In place thereof, order that:
(a) the appeal to that Court be allowed with costs;
(b) the orders of Emmett J made on 18 February 1999 be set aside; and
(c) in place of the orders of Emmett J, there be:
(i) judgment entered for the first appellant in the sum of $14,377.33; for the second appellant for $11,017.12; for the third appellant for $18,521.99; for the fourth appellant for $31,716.32; for the fifth appellant for $15,622.98; for the sixth appellant for $35,877.19; and for the seventh appellant for $26,456.55;
(ii) an order that the respondent pay the appellants' costs of the action; and
(iii) liberty to apply to a Judge of the Federal Court for an order for interest under s 51A of the Federal Court of Australia Act 1976 (Cth).
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
GLEESON CJ, GAUDRON AND HAYNE JJ
GUMMOW J
(dissent)
On the other hand, the action to recover the moneys sought by the appellants after the failure of the purpose of funding Rothmans to renew its licence may be illustrative of the gap-filling and auxiliary role of restitutionary remedies[83]. These remedies do not let matters lie where they would fall if the carriage of risk between the parties were left entirely within the limits of their contract. Hence there is some force in the statement by Laycock[84]:"The rules of restitution developed much like the rules of equity. Restitution arose to avoid unjust results in specific cases – as a series of innovations to fill gaps in the rest of the law."[83]Dietrich, Restitution: A New Perspective, (1998) at 29‑35; Grantham and Rickett, "On the Subsidiarity of Unjust Enrichment", (2001) 117 Law Quarterly Review 273 at 289‑293.[84]"The Scope and Significance of Restitution", (1989) 67 Texas Law Review 1277 at 1278.The decision in Moses v Macferlan That returns one to a consideration of the decision in Moses v Macferlan itself. What was decided in Moses v Macferlan[85]? Moses had owed Macferlan £26, did not pay him and Macferlan sued him. The claim went to arbitration and settlement was reached: Moses would pay £20 and indorse over to Macferlan four 30s promissory notes made by one Jacob to Moses; Macferlan would seek to collect on the bills from Jacob and, if he recovered the entire value of the notes, he would pay one-half of the costs of Moses of the earlier collection action against Moses; by written instrument, Macferlan indemnified Moses against any liability on the notes as an indorser and gave Moses a release.[85]What follows is drawn from the report (1760) 2 Burr 1005 [97 ER 676], together with an account of the case given by the New South Wales Full Court in Lyons v Hardy (1881) 2 NSWR (L) 369 at 372‑374, Keener, A Treatise on the Law of Quasi-Contracts, (1893) at 413‑415 and Oldham, The Mansfield Manuscripts, (1992), vol 1 at 169‑175. Macferlan was unable to collect on the notes and sued Moses in the local Court of Conscience, for the County of Middlesex, established by statute 23 Geo II c 33 (1750)[86]. Macferlan sued Moses on the promissory notes. It would appear that Moses might have enjoined that action by a suit in Chancery to enforce the indemnity agreement made with Macferlan and thereby have avoided the multiplicity of litigation that ensued. Moses failed to take any such steps. Further, Moses might have sued in a common law court on a special assumpsit to recover the damage suffered by reason of the breach by Macferlan of that agreement. Presumably the failure of Moses to seek injunctive relief would have provided no defence to his action at law. However, Moses did not bring such an action.[86]The statute was repealed by the County Courts Act 1846 (9 & 10 Vict c 95). The number of commissioners, who composed the bench, the mode of their selection and their qualifications for office varied from one court to the other: Winder, "The Courts of Requests", (1936) 52 Law Quarterly Review 369 at 375. In their fifth Report on the Practice and Proceedings of the Superior Courts of Common Law, (1833), (reprinted British Parliamentary Papers, Legal Administration General, vol 5), which dealt with provincial courts for the recovery of small debts, the Commissioners said (at 11) that the suspicions of Blackstone respecting the procedures of the Courts of Requests and Courts of Conscience had "not been removed by later experience".