Shandong Delisi Food Co Ltd v Yolarno Pty Ltd (No 2) - [2022] NSWSC 85

Supreme Court

New South Wales

Medium Neutral Citation: Shandong Delisi Food Co Ltd v Yolarno Pty Ltd (No 2) [2022] NSWSC 85
Hearing dates: 7 February 2022
Date of orders: 7 February 2022
Decision date: 07 February 2022
Jurisdiction: Equity - Commercial List
Before: Parker J
Decision:
See [25]

Catchwords:
COSTS – indemnity costs – formal offer of compromise by plaintiff bettered in judgment – presumptive entitlement to indemnity costs – commercial claim – “modest” degree of compromise – construction arguments in support of claim not explained – no sufficient reason to depart from presumptive entitlement

Legislation Cited:
Uniform Civil Procedure Rules 2005 (NSW) r 42.14

Cases Cited:
Mega-top Cargo Pty Ltd v Moneytech Services Pty Ltd [2016] NSWCA 3
Mendonca v Tonna (No 3) [2020] NSWCA 332
Taheri v Vitek [2014] NSWCA 344

Category: Costs
Parties: Shandong Delisi Food Co Limited (Plaintiff)
Yolarno Pty Limited (Defendant)
Representation:
Counsel:
S H Hartford Davis/C Marshall (Plaintiff)
S Nixon SC/H Atkin (Defendant)
Solicitors:
Corrs Chambers Westgarth (Plaintiff)
King & Wood Mallesons (Defendant)

File Number(s): 2020/106935
Publication restriction: Nil

Judgment – EX TEMPORE

Revised from transcript; issued 9 February 2022

On 17 January I delivered my substantive judgment in this matter: Shandong Delisi Food Co Ltd v Yolarno Pty Ltd [2022] NSWSC 17. This judgment concerns the consequential orders to be made in light of the conclusions which I reached. It assumes familiarity with my January judgment and uses the same abbreviations as I used in that judgment.
I found Delisi entitled to judgment for the amount of the Advanced Payment (principal amount $6 million). The parties agree that, including interest, the amount due is $7,697,409.97. There will be judgment in favour of Delisi for that amount.
As I recorded in my January judgment a cross-claim had earlier been filed but the parties agree that the cross-claim should be dismissed with no order as to costs. I will proceed to make that order as well. The parties also agree that the security lodged by Delisi for Yolarno's costs should be paid out.
There was a last-minute dispute before me about whether there should be an interim stay of the judgment to allow Yolarno to lodge its appeal and make an application to the Court of Appeal for a stay pending the hearing of the appeal. The question was whether, as a condition of such an interim stay, the judgment debt should be paid into Court.
Following some debate, counsel for Delisi accepted that a two-week interim stay would not cause his client any prejudice. I therefore propose to accede to the defendant's request. There will be an unconditional stay for two weeks which will be sufficient time for Yolarno to approach the Court of Appeal about extension.
The substantive dispute between the parties is about the costs of Delisi's claim. The parties agree that Delisi is entitled to costs of its claim, at least on the ordinary basis. Delisi claims costs on an indemnity basis from 20 April 2021 onwards. This claim…

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 Shandong Delisi Food Co Ltd v Yolarno Pty Ltd (No 2)

Details

AGLC: Shandong Delisi Food Co Ltd v Yolarno Pty Ltd (No 2) [2022] NSWSC 85
Case: [2022] NSWSC 85
Decision Date: 07 February 2022

CaseChat Overview and Summary

In the case of Shandong Delisi Food Co Ltd v Yolarno Pty Ltd (No 2), the plaintiff, Shandong Delisi Food Co Ltd, sought recovery of indemnity costs against the defendant, Yolarno Pty Ltd, following a successful claim. The plaintiff had made a formal offer of compromise, which was subsequently bettered in the judgment. The primary legal issue before the court was whether the plaintiff had a presumptive entitlement to indemnity costs, given the modest degree of compromise and the absence of adequate explanations for certain construction arguments in support of the claim.

The court considered the nature of the claim, which was commercial in character, and the degree to which the plaintiff's offer of compromise was bettered. It noted that while the degree of compromise was modest, there were no sufficient reasons to depart from the presumptive entitlement to indemnity costs. The plaintiff's failure to adequately explain certain construction arguments in support of its claim did not, in the court's view, negate its presumptive entitlement to indemnity costs. The court held that the plaintiff was entitled to indemnity costs from the defendant.

No further orders were made by the court beyond the determination of the indemnity costs. The court's decision affirmed the presumptive entitlement to indemnity costs in cases where the degree of compromise is modest and there are no compelling reasons to deviate from the usual rule.

Orders