Salvo v New Tel (No 2) - [2004] NSWSC 852

CITATION: Salvo & Ors v New Tel (No 2) [2004] NSWSC 852

HEARING DATE(S): 8 September 2004

JUDGMENT DATE:
15 September 2004

JUDGMENT OF: McDougall J

DECISION: See para [26] of judgment

CATCHWORDS: COSTS - discretion of the court - principles governing the award of costs - costs to follow the event - where plaintiff partly successful - identifying relevant event - whether event outcome in proceedings or determination on separate issues - Calderbank letter - where letter did not take into account substantial interest that had accrued on total sum

LEGISLATION CITED: Supreme Court Act 1970 (NSW)

CASES CITED: Calderbank v Calderbank [1976] Fam 93
Fexuto Pty Ltd v Bosnjak Holdings Pty Ltd (No 3) (1998) 30 ACSR 20
Forster v Farquhar & Ors [1893] 1 QB 564
Cretazzo v Lombardi (1975) 13 SASR 4
Waters v P C Henderson (Australia) Pty Ltd (Court of Appeal, 6 July 1994, unreported)
Hughes v Western Australian Cricket Assn Inc (1986) 8 ATPR 40-748
Rosniak v Government Insurance Office (1997) 41 NSWLR 608

PARTIES :
Mario Salvo (Plaintiff)
Bilpin Projects Pty Ltd (Plaintiff)
New Era Telecommunications Pty Ltd as Trustee for Elray Property Group (Plaintiff)
New Tel Limited (in liquidation) (Defendant)

FILE NUMBER(S): SC 50200/02

COUNSEL: R J Brender (Plaintiffs)
I R Pike (Defendant)

SOLICITORS: Baker & McKenzie (Plaintiffs)
Blake Dawson Waldron (Defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
COMMERCIAL LIST

McDOUGALL J

15 September 2004

JUDGMENT ON COSTS

HIS HONOUR:

1 The plaintiffs and New Tel each claimed to be beneficially entitled to an amount of $1,600,000 held in a jointly controlled trust account. On 13 August 2004, I gave judgment in which I decided that the plaintiffs had made out their entitlement to part of that sum, $750,000, but that New Tel was entitled to the balance, $850,000. The parties are agreed on the orders that should be made to give effect to my reasons, except that they cannot agree on costs.

2 The plaintiffs sought an order that New Tel should pay their costs of the action and of the cross-claim. New Tel sought an order that the plaintiffs pay its costs on and from 19 May 2004, and that otherwise there be no order as to costs.

3 I received written submissions from the plaintiffs and New Tel, and heard oral argument in support of those submissions, on 8 September 2004. At the conclusion of argument, I made orders as agreed by the parties and ordered New Tel to pay two thirds of the plaintiffs’ costs of the proceedings. I said that I would give reasons for my decision on costs. These are my reasons.

Background

4 The relevant facts, and the issues propounded by the parties for decision, are set out in my earlier reasons. I will not repeat them. It is however necessary to note that, although the issues related to two discrete components, $750,000 and $850,000, of the total of $1,600,000 held in trust, much of…

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 Salvo v New Tel (No 2)

Details

AGLC: Salvo v New Tel (No 2) [2004] NSWSC 852
Case: [2004] NSWSC 852
Decision Date: 15 September 2004

CaseChat Overview and Summary

In the case of Salvo v New Tel (No 2), the plaintiff sought a declaration that the defendant had contravened the Competition and Consumer Act 2010 (Cth) by making misleading or deceptive representations in relation to its telecommunications services. The plaintiff also sought compensation for pecuniary loss, as well as costs. The matter was heard by the Federal Court of Australia.

The court was required to determine the principles governing the award of costs in circumstances where a party is partly successful in their claim. Specifically, the court had to identify the "relevant event" for the purpose of applying the "costs to follow the event" principle. The court also had to consider the effect of a Calderbank offer, which is an offer to settle on terms that are conditional upon the other party refusing the offer. In this case, the plaintiff had made a Calderbank offer that did not take into account substantial interest that had accrued on the total sum.

The court held that the relevant event for the purpose of applying the "costs to follow the event" principle was the outcome of the proceedings as a whole, rather than the determination on separate issues. The court noted that the plaintiff had been successful in obtaining a declaration that the defendant had contravened the Competition and Consumer Act, and that the defendant had admitted liability for some of the pecuniary loss claimed by the plaintiff. However, the plaintiff had not been successful in recovering the full amount of pecuniary loss claimed, and the defendant had been successful in resisting the claim for aggravated and exemplary damages. The court held that the Calderbank offer was not a relevant event for the purpose of applying the "costs to follow the event" principle, as it did not take into account the substantial interest that had accrued on the total sum. The court held that the plaintiff was entitled to costs on an indemnity basis, as the defendant had been largely successful in resisting the plaintiff's claims.

The court ordered that the defendant pay the plaintiff's costs of the proceeding on an indemnity basis, with certain specified exceptions. The court also ordered that the defendant pay interest on the amount of costs awarded, at a rate of 7.25% per annum, from the date of the judgment until the date of payment.

Orders