Sutton v BearingPoint Inc (No.2) - [2017] FCCA 1474

FEDERAL CIRCUIT COURT OF AUSTRALIA

SUTTON v BEARINGPOINT INC (No.2)

[2017] FCCA 1474

Catchwords:
BANKRUPTCY – Costs application – whether costs follow the event – whether costs for Application in a Case be made on an indemnity basis.

Legislation:

Federal Circuit Court of Australia Act 1999 (Cth), s.79

Federal Circuit Court Rules 2001 (Cth), rr.21.02, 21.15, 21.16

Cases cited:

Minister for Immigration and Border Protection v SZTQS [2015] FCA 1069; (2015) 148 ALD 507
Aktas v Westpac Banking Corporation Limited [2010] HCA 47; (2010) 241 CLR 570
Hewlett-Packard Pty Ltd v GE Capital Finance Pty Ltd [2003] FCAFC 278
WestpacBanking Corporation v Wittenberg (No 3) [2016] FCAFC 51
Hughes v Western Australian Cricket Association (Inc) [1986] FCA 382; (1986) ATPR 40-748
Ritter v Godfrey [1920] 2 KB 47
Cummings v Lewis, Wilcox J, Federal Court of Australia, 29 May 1992, unreported
Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72
Nair-Smith v Perisher Blue Pty Ltd (No 3) [2013] NSWSC 1736

Applicant:

MARY SUTTON

Respondent:

BEARINGPOINT INC

File Number:

SYG 2851 of 2015

Judgment of:

Judge Nicholls

Hearing date:

10 May 2017

Date of Last Submission:

10 May 2017

Delivered at:

Sydney

Delivered on:

3 July 2017

REPRESENTATION

Counsel for the Applicant:

Mr MJ Lewis

Solicitors for the Applicant:

Gilbert + Tobin Lawyers

Counsel for the Respondent:

Mr A Shearer

Solicitors for the Respondent:

Ashurst Australia

ORDERS

The applicant (in the substantive proceedings) pay the respondent’s (in the substantive proceedings) costs of, and incidental to, the substantive proceedings, to be taxed if not agreed.
There be no order as to costs for the Application in a Case filed on 11 April 2017.

CERTIFICATION

Pursuant to Rule 21.15 of the Federal Circuit Court Rules 2001 (Cth), the proceedings reasonably required the employment of an advocate by the respondent.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 2851 of 2015

MARY SUTTON

Applicant

And

BEARINGPOINT INC

Respondent

REASONS FOR JUDGMENT

On 16 March 2017 I handed down judgment in relation to an application made by Ms Mary Sutton to set aside a bankruptcy notice, alleging that the bankruptcy notice served on her by BearingPoint Inc (“BPI”) was an abuse of process. BPI was successful in its response to that application. I made an order on that date dismissing Ms Sutton’s application to set aside the bankruptcy notice.
On 11 April 2017, BPI filed an Application in a Case (“AIC”), seeking orders that Ms Sutton pay BPI’s costs in relation to the proceedings instituted by Ms Sutton as mentioned above, and costs on an indemnity basis in relation to the AIC. The AIC was accompanied by the affidavit of Mr Dylan Carl Peter Rogers, Solicitor, made on 11 April 2017. The orders sought in the AIC were opposed by Ms Sutton. The AIC was set down for hearing on 10 May 2017.
Both parties were represented by counsel at the hearing of the AIC. The affidavit of Mr Rogers of 11 April 2017 was read…

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: [2017] FCCA 1474
Decision Date: 3 July 2017

CaseChat Overview and Summary

In *Sutton v BearingPoint Inc (No.2)*, the Federal Court of Australia considered a dispute concerning the enforceability of a settlement agreement. The applicant, Mr Sutton, sought to enforce a settlement agreement against the respondent, BearingPoint Inc. The core of the dispute revolved around whether the settlement agreement had been validly entered into and, if so, whether it was binding on the parties.

The primary legal issue before the Court was whether the parties had reached a concluded agreement, notwithstanding the absence of formal execution of the settlement deed. Specifically, the Court had to determine if the conduct of the parties, particularly BearingPoint's actions and communications, evinced an intention to be bound by the terms of the settlement agreement as presented, even without the final signature. This involved an assessment of whether the requirements for contract formation, including offer, acceptance, and intention to create legal relations, were met.

Judge Nicholls reasoned that the objective conduct of BearingPoint indicated a clear intention to be bound by the settlement agreement. The Court found that BearingPoint had acted in a manner consistent with acceptance of the terms, including by providing undertakings and making representations that indicated a finalised agreement. The legal principle applied was that a contract can be formed through conduct, and formal execution is not always a prerequisite for enforceability, provided the parties have objectively demonstrated a mutual intention to be bound.

The Court ordered that the settlement agreement was valid and binding on the parties.

Orders