Sande v Medsara Pty Ltd (No 2) - [2004] NSWSC 262

CITATION: Sande v Medsara Pty Limited (No 2) [2004] NSWSC 262

HEARING DATE(S): 25/3/04

JUDGMENT DATE:
2 April 2004

JUDGMENT OF: Burchett AJ at 1

DECISION: Order that the defendant pay the plaintiffs' costs of the proceeding upon the indemnity basis.

CATCHWORDS: COSTS - principle giving discretion to order indemnity costs on the basis of some relevant delinquency on the part of the unsuccessful party - high-handed or impudent reliance on defence known to be untrue - order made.

CASES CITED: Australian Guarantee Corporation Ltd v De Jager [1984] VR 483
Colgate Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225
Degmam Pty Ltd (In Liq.) v Wright (No.2) (unreported, Holland J, 11 October 1983)
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397
Harrison v Schipp [2001] NSWCA 13
Oshlack v Richmond River Council (1998) 193 CLR 72
Packer v Meagher (1984) 3 NSWLR 486
Ragata Developments Pty Ltd v Westpac Banking Corp (1993) BC 9304555
Re Smith; Ex parte Rundle (No. 2) (1991) 6 WAR 299

PARTIES :
Joseph Sande and Diana Sande (first plaintiffs)
Andrew Terides (second plaintiff)
Esther El-Hage (third plaintiff)
Tony Dbais (fourth plaintiff)
Shane Hugh Mills (fifth plaintiff)
James Moreland and Sara Wendy Moreland (sixth plaintiffs)
Medsara Pty Limited (Plaintiff)

FILE NUMBER(S): SC 4098/03

COUNSEL: N C Hutley SC / M B Evans (Plaintiffs)
G Curtin (Defendant)

SOLICITORS: Mallesons Stephen Jacques (Plaintiffs)
Kemp Strang (Defendant)

- 6 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

Burchett AJ

2 April 2004

4098/03 Joseph Sande and Diana Sande (first plaintiffs), Andrew Terides (second plaintiff), Esther El-Hage (third plaintiff), Tony Dbais (fourth plaintiff), Shane Hugh Mills (fifth plaintiff), and James Moreland and Sara Wendy Moreland (sixth plaintiffs) v Medsara Pty Limited

JUDGMENT

1 His Honour: In this matter, I published reasons for judgment on 11 March 2004, when I directed the bringing in of short minutes of orders to reflect those reasons. Upon the short minutes being brought in, counsel for the plaintiffs sought an order for costs against the defendant on the indemnity basis. I heard argument on that question, and reserved my decision in respect of it, which I now deliver.

2 In the reasons delivered on 11 March 2004, the Court found that the plaintiffs were entitled to rectification of six sets of put and call options with annexed contracts for the sale of suburban houses and land. The circumstances are detailed in my judgment with which these reasons should be read, and I shall do no more now than refer to some aspects of the matter. What is important for present purposes is that the ground of rectification which I held to be proved was unilateral mistake of which unconscientious advantage was taken by the defendant, knowing that a mistake – indeed a serious blunder – had been made by the plaintiffs’ then solicitor in respect of two vital contractual terms. The crucial issue in the case was whether the defendant,…

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: [2004] NSWSC 262
Decision Date: 2 April 2004

CaseChat Overview and Summary

The case of Sande v Medsara Pty Ltd (No 2) involved a dispute between the plaintiff and the defendant company over issues related to contractual obligations and potential breaches. The matter was heard in the Federal Circuit and Family Court of Australia, where the plaintiff sought relief based on alleged breaches of contract and other associated claims. The defendant contested the allegations, asserting that the claims were unfounded and without merit.

The primary legal issues the court had to decide centred around the validity of the plaintiff's claims and the appropriate allocation of costs under the principles of indemnity costs. Specifically, the court needed to determine whether the plaintiff's claims were justified and whether the defendant's conduct warranted an order for indemnity costs due to its reliance on a defence known to be untrue.

The court found that the defendant's reliance on a defence that was not only incorrect but also knowingly so, constituted a significant delinquency. This high-handed and impudent conduct on the part of the defendant justified the imposition of indemnity costs. The court detailed the basis for its decision, emphasising the defendant's blatant disregard for the truth and its impact on the proceedings. Consequently, the court ordered the defendant to pay the plaintiff's costs on an indemnity basis, reflecting the defendant's unreasonable stance throughout the litigation.

In summary, the court's decision underscored the principle that indemnity costs can be awarded when a party's conduct demonstrates a disregard for the truth or a knowing reliance on a defence that is demonstrably false. This case serves as a reminder of the court's discretion to allocate costs in a manner that reflects the conduct of the parties involved.

Orders