State Bank of New South Wales v Commonwealth Savings Bank of Australia

[1985] FCA 695

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Applicant

5 June, 1985

Today I heard the further evidence which the State Ea-:<

sought to lead i n the form of affidavits from Richard Louis f4orath and

John Anthony U'Neill, and there was ora l evidence qiven by Er. Molrath.

I Reed not refer to the evidence i n detail; i t m y be b r i e f l y

summarised by saying that the vidence was to the effect that if

judgment were entered for the State Bank in +,he arr,ount clairned of Some

$13,779,801.13, thec the State Bank would either place those funds on

deposit in the short-term money markets or repay borrowings by it from

t hose markets in each case f o r a sl-mrt t e r n , and thereaf t r - r use the

funds to facilitate loans and for other fixmcial purposes to benefit

customers. The S t a t e Sank's case is that it would lose the interest

that it-; would otherwise earn fron thcse moneys by placicg them i r ~ t h e

short-term niclney markets, or lose the saving that w m l d %cc,rze to it if it were to use the funds for-repayment of bcrr6wings from the short-term noney markets.

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in addition, the evidence is to the effect that if the State

Bank had access to the moneys claimed by it, this would enable it, in

view of whht are called the Reserve Sank of Australia's guidelines, t.2

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State	E.Zink	in consequence of i t s being denied the rnoneys claimed
wccld	mean

an6 earning a s s e t s to the value of

course, would De c7,etrimtnt additional to the

deprivation of the	oppcr tunl ty to earn	the	fnterest	on the investments
in the short term.

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I have taken those matters into account but it does not lead

me t o take a different course t o t h a t which I foreshadowed on 28 May

There has heen discussion on short minutes of order which

have been handed up by counsel f o r the State Bank. The discussion

relates broadly to fou r m i n points. First, whether, as the State

Bank urges, the applicstion by the C S 3 tc- amend i t s defence ar,d

cross-claim by raising what I have described in my earlier reascns a s

the induceme:-lt argument should be deferreci until 17 June this year;

second, whether an undertaking should be p r o f f e r e d by the CSB or a term imposed in effect requiring it t o submit to an order that the

i Court may consider just f o r pa57ment of compecsation to the applicant of an amount t o be assessed by the Court in consequence of the grmtinq of leave tc amend the defence to raise a set-off if,

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set-off are deferred and all cjther p r i o r issues a r e first determined

both at first instance and, if necessary, on zppcal.

In my view, the ccurse that I had earlier fores'nadowed.on 28

May 1935 of allowing all of the zmendments sought should nevertheless

Se followed, I think it is f a i r that an undertaking be proffered or,

fa i l ing that, a term be imposed relatinq to the payment of

coxpensation along the iines t o which I have referred.

Further, I t h i n k i t ric;ht t3at t h e r e be ev idence from the CSB

i n support of the claim by it as to the quantum of damages recoversble

by it for alleged inducement to breach of contract.

The issue of a s p l i t triai is m e that cannot be deait with

today f o r a variety of reasons which I rieed n o t traverse; naturally

the CSB will need to consider it and to give its counsel instructions. . . It is a course which has some initial attraction although I must confess it i s an application that I rarefy favour. At first olance in

/	a case such as this, there may be much to commend it, but I have no
final view on the matter.

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