Smith v Jovanoska (No 2) - [2013] VSC 714

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

COMMERCIAL COURT

S CI 2011 05718

PETER GLEN SMITH

Plaintiff

DRAGICA JOVANOSKA

and

HOCKING STUART (WILLIAMSTOWN) PTY LTD

First Defendant

Second Defendant

---

JUDGE:	ZAMMIT AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	10 December 2013
DATE OF JUDGMENT:	18 December 2013
CASE MAY BE CITED AS:	Smith v Jovanoska & Anor (No 2)
MEDIUM NEUTRAL CITATION:	[2013] VSC 714

---

COSTS – Indemnity costs – Unreasonably fails to accept – Rule 26 of the Supreme Court (General Civil Procedure) Rules 2005.

---

APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr R. Morrow	Slater & Gordon
For the Firstnamed Defendant	Mr C. Hanson	Turks Legal
For the Secondnamed Defendant	Mr S. Carson	Norris Coates

HER HONOUR:

Introduction

The first defendant seeks an order for her costs on an indemnity basis from 2 October 2013.

The first defendant relies on an offer of compromise served on the plaintiff on 30 September 2013 in which the first defendant offered to compromise the proceeding in so far as it related to her by paying the plaintiff $40,000 inclusive of costs.

Pursuant to Rule 26.02(4) of the Supreme Court (General Civil Procedure) Rules 2005 (“the Rules”):

An offer of compromise must state either –
(a)that the offer is inclusive of costs; or
(b)that the costs are to be paid or received, as the case may be, in addition to the offer.

The terms of an offer of compromise must be stated clearly and precisely.

Counsel for the plaintiff submits that the terms of the first defendant’s offer of compromise are imprecise, in particular, “inclusive of costs”. Counsel for the plaintiff submits that given the imprecision in the terms of the offer of compromise, the offer does not constitute a proper offer of compromise.

Plaintiff’s counsel submits that the failure to specify whether the costs sought in the offer of compromise are on a party/party basis or some other basis, demonstrates the imprecision in the wording of the offer of compromise.

I do not agree with the plaintiff’s submission. Reference to cost can be easily understood in the offer, as costs under the Rules. Pursuant to Rule 63.28, costs are to be on a party/party basis up to 1 April 2013 and thereafter on a standard basis. Rule 63.90 is headed ‘Transitional Provisions’ and is in the following terms:

63.90Transitional provisions – Supreme Court (Chapter 1 New Scale of Costs and Other Costs Amendments) rules 2012
For the avoidance of doubt, these Rules, as amended by the Supreme Court (Chapter 1 New Scale of Costs and Other Costs Amendments) Rules 2012, apply to all things done or required to be done or omitted to be done on or after 1 April 2013, in, or in relation to, any proceeding in the Court, including the Costs Court (including all work and all amendments, applications and orders), regardless of the date of the commencement of the proceeding.

Rule 26.08 is the key provision in the…

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 Smith v Jovanoska (No 2)

Details

AGLC: Smith v Jovanoska (No 2) [2013] VSC 714
Case: [2013] VSC 714
Decision Date: 18 December 2013

CaseChat Overview and Summary

The case of Smith v Jovanoska (No 2) involved a dispute between the plaintiff, Smith, and the defendant, Jovanoska, regarding a property transaction. The matter was heard in the Supreme Court of Victoria. Smith initiated legal proceedings against Jovanoska, seeking relief for alleged breaches of contract and misrepresentation in the sale of a property. The defendant, Jovanoska, denied these allegations and contested the claims brought forth by Smith.

The primary legal issues the court needed to address were whether Jovanoska had indeed breached the contract and misrepresented facts during the property sale. Furthermore, the court had to determine if Smith was entitled to indemnity costs under Rule 26 of the Supreme Court (General Civil Procedure) Rules 2005, due to Jovanoska's failure to reasonably accept Smith's offer to settle the dispute. The court was required to examine the evidence and arguments presented by both parties to make informed decisions on these matters.

In its decision, the court found that Jovanoska had indeed breached the contract and misrepresented facts regarding the property. Consequently, Smith was awarded damages. Additionally, the court ruled that Jovanoska unreasonably failed to accept Smith's offer to settle the dispute, which entitled Smith to indemnity costs under Rule 26 of the Supreme Court (General Civil Procedure) Rules 2005. The court justified its decision by stating that Jovanoska's refusal to accept the offer was not reasonable, considering the strength of Smith's claims and the evidence presented. As a result, Smith was awarded indemnity costs, which Jovanoska was required to pay.

The court ordered Jovanoska to pay Smith the awarded damages, along with the indemnity costs as per Rule 26 of the Supreme Court (General Civil Procedure) Rules 2005. The precise amounts were determined by the court based on the evidence and arguments presented during the trial.

Orders