SANDONA v PERRE (No 2) - [2010] SADC 34

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
SANDONA v PERRE (No 2)
[2010] SADC 34
Judgment of His Honour Judge Barrett
15 March 2010
FAMILY LAW AND CHILD WELFARE - DE FACTO RELATIONSHIPS
Costs - Plaintiff seeks an order for costs - property adjustment proceedings in de facto relationship - Judgment for plaintiff in a sum larger than pre-trial offer but not significantly larger than offer during trial. Defendant always conceded plaintiff entitled to a property adjustment. Parties' evidence presented similarly. Ordinarily costs follow the event but in the circumstances of this case no order for costs.
Interest - Plaintiff's claim effectively for a monetary sum. Defendant had the benefit of plaintiff's contribution to the renovation of her house - plaintiff entitled to 5.6 per cent interest from completion of renovations to judgment. The average annual increase in the value of defendant's house was 5.6 per cent.
De Facto Relaltionships Act 1996 s 4(1); District Court Act 1991 s 39, referred to.
M, DA v P, N (No 2) [2008] SADC 180; Ewins v BHP Billiton Limited & Wallaby Grip Limited (No 2) [2005] SASC 164, considered.

SANDONA v PERRE (No 2)
[2010] SADC 34
Introduction

Judgment was delivered in this matter on 5 February 2010. The matter was adjourned to enable the parties to make submissions on the questions of interests and costs.
Trial
The trial concerned a property adjustment between the parties who had lived together but had not married. There were two main issues for consideration. First, the length of the relationship was in dispute. The plaintiff said the relationship lasted over 3 years, in which case the property adjustment was to be determined by reference to the De Facto Relationships Act 1996. The defendant said it lasted less than 3 years, in which case the Common Law would be applicable.
I accepted the plaintiff’s version of the facts where it differed from the defendant, but the resolution of this issue was largely an exercise in applying a legal descriptor to facts which were not widely at variance.
Second, the extent of the property adjustment was in dispute. During the 3 years that the parties co-habited they lived in the defendant’s house. The plaintiff sold his house. The plaintiff contributed some of his own money to the renovation of the defendant’s house. The defendant did not dispute that the plaintiff had made a contribution. She disputed the extent of it. In his pleadings the plaintiff sought approximately $39,000. At one stage in his evidence he claimed he had contributed $89,000. In her pleadings the defendant said the plaintiff contributed half the cost of the renovations which amounted to no more than $21,000. Hence his contribution was $10,500 (Judgment [50]).
I found neither party was able to give reliable evidence about the expenditure on labour and materials (Judgment [47]-[59]). Despite a degree of acrimony and exaggeration on the part by each party, I accepted generally that each was trying to be truthful. In the end I determined the matter by reference to bank records and evidence relating to those records (Judgment [69]-[72]). I found the only reliable evidence of valuation of the house was the valuation tendered by the plaintiff.
In the circumstances the evidence of each of the parties could be described in similar terms. I did not determine the factual disputes by preferring the evidence of one party over that of the other.
I concluded that the plaintiff had contributed $25,000 of his own money to the renovations. I found that that contribution improved the value of the house by $20,000 when the renovations were complete at the end of 2005. I have been told that before the trial the defendant offered $5,000. During the trial the she offered the plaintiff $15,000 in full settlement with each party bearing its own costs. That offer was rejected.
Interest
Section 39 of the District Court Act 1991 empowers the court to order pre-judgment interest:
39—Pre-judgment interest
(1)Unless good reason is shown to the contrary, the Court will, on the application of a party in whose favour a monetary judgment has been, or is to be, given include in the judgment an award of interest in accordance with this section.
(2)The interest—
(a)     will be calculated at a rate fixed by the Court; and
(b)     will be calculated in respect of a period fixed by the Court (which must, however, in the case of a judgment given on a liquidated claim, be the period running from when the liability to pay the amount of the claim fell due to the date of judgment unless the Court otherwise determines); and
(c)     is, in accordance with the Court's determination, payable in respect of the whole or part of the amount for which judgment is given.
(3)The Court may, without proceeding to calculate interest under subsection (2), award a lump sum instead of interest.
(4)This section does not—
(a)     authorise the award of interest on interest;
(b)     authorise the award of interest on exemplary or punitive damages;
(c)     affect damages for dishonour of a negotiable instrument;
(d)     authorise the award of interest (except by consent) on a sum for which judgment is given by consent;
(e)     limit or affect the operation of any other enactment or rule of law providing for the award of interest.
The plaintiff makes a claim for interest. I find there is no good reason not to grant interest. I must determine the period for which interest will be calculated and I must determine the rate.
I have found that the renovations were largely completed by the end of 2005. Although this is not a liquidated damages claim I fix the commencement of the entitlement to pre-judgment interest at December 2005. The evidence of the valuation lead me to conclude that the value of the house increased thereafter by 5.6 per cent per annum. That is a reasonable interest rate. Judgment was delivered on 5 February 2010. I will fix a lump sum of interest calculated from 31 December 2005 to 31 December 2008 at the rate of 5.6 per cent. I fix that sum at $5,600.
Costs
The plaintiff sought an order for costs. The defendant submitted that each party should bear his own costs. District Court Rule 6DCR 263(1) provides that “as a general rule, costs follow the event”. In the case of M, DA v P, N (No 2) [2008] SADC 180, Beazley DCJ considered authorities dealing with the principles applicable to determining costs including consideration of offers made in settlement. His Honour concluded that the principle is that costs follow the event.[1] In this case “the event” involves consideration of the adequacy of the defendant’s offer. Judge Beazley cited Doyle CJ in Ewins v BHP Billiton Limited & Wallaby Grip Limited (No 2) [2005] SASC 164 in which His Honour said:
His Honour in that decision, detailed the rationale for Rule 40.05, and made it clear that his dicta was no more than a general guide. In that case involving general damages His Honour said at [27]:
“I would conclude that the offer is adequate only if I was satisfied that on the material available to [the defendant] the offer was sufficient and that the amount awarded to [the plaintiff] exceeded the amount of the offer by an amount that could be attributed to factors that could not reasonably have been anticipated by [the defendant] when it made its offer. I regard that as one of the ordinary risks and contingencies of litigation, not as a factor in respect of which [the defendant] was at any disadvantage in its capacity as a defendant”.
[1] [16]-[17]
Applying that dictum I do not think that the difference between the offer made and the higher sum awarded could be attributed to factors that could not reasonably have been anticipated. On the other hand the difference between the two figures is very small and the defendant had all along acknowledged that the plaintiff had made a contribution to the renovation of her house which entitled him to a property adjustment. Further, I regarded the evidence of each of the parties in a similar light. Each was largely trying to tell the truth but neither was reliable when it came to giving evidence of expenditure on labour and materials. In those circumstances I decline to make an order for costs. Each party will bear his own costs.
Orders
The formal orders of the Court therefore are:
1. That the defendant pay to the plaintiff the sum of $25,600 inclusive of interest to the date of judgment.
2. Each party will bear its own costs.