Talacko v Talacko

[2009] VSC 579

IN THE SUPREME COURT OF VICTORIA	Not Restricted
AT MELBOURNE COMMON LAW DIVISION

No. 7393 of 1998

HELENA MARIE TALACKO, ALEXANDRA BENNETT,	Plaintiffs
MARTIN TALACKO, ROWENA TALACKO AND MARGARET HELEN TALACKO
v
JAN EMIL TALACKO	Defendant

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JUDGE:	KYROU J
WHERE HELD:	Melbourne
DATE OF HEARING:	8 December 2009
DATE OF JUDGMENT:	11 December 2009
CASE MAY BE CITED AS:	Talacko v Talacko
MEDIUM NEUTRAL CITATION:	[2009] VSC 579

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PRACTICE AND PROCEDURE – Award of interest consequent upon judgment for equitable compensation for breach of fiduciary duty – Principles for awarding interest – Supreme Court Act 1958, ss 58 and 60 – Inherent equitable jurisdiction to award interest – When an award of compound interest is appropriate – Choice of interest rate.

PRACTICE AND PROCEDURE – Award of costs on an indemnity basis – Principles for determining when appropriate – Whether contract requires payment of indemnity costs – Whether defendant’s conduct warrants an award of indemnity costs – Set-off for interlocutory costs awarded on a party and party basis.

PRACTICE AND PROCEDURE – Judgment in a foreign currency – Equitable compensation based on value of properties located overseas and net rental earned from those properties.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr S J Howells	Holding Redlich
with Ms L Kinda
For the Defendant	Mr D J Williams	Findlay Arthur Phillips

TABLE OF CONTENTS

Introduction and summary ..................................................................................................1
Judgment in the euro currency............................................................................................1

Interest .....................................................................................................................................2

Principles for awarding interest .....................................................................................2
How the amounts of $881,017 and €115,772 have been calculated ...........................5

Decision in relation to interest ........................................................................................6

Costs .......................................................................................................................................10

Principles in relation to costs ........................................................................................10
When will the Court depart from the usual costs order? .........................................12
When will the Court grant indemnity costs?..............................................................13
Decision in relation to costs...........................................................................................16
Set-off for costs already taxed and paid ......................................................................23

Reserved costs .................................................................................................................24

Proposed orders ...................................................................................................................25

HIS HONOUR:

Introduction and summary

1. On 24 November 2009, I delivered reasons for judgment (‘Substantive Judgment’)[1] in which I found that the defendant is liable to pay to the plaintiffs equitable compensation comprising:

   [1]              Talacko v Talacko [2009] VSC 533.

(a)	€8,839,244, representing two-thirds of the value of the interests in various properties in Europe that were restituted to him (‘Restituted Properties’) prior to the execution of the terms of settlement dated 23 February 2001 (‘Terms’);
(b)	$881,017, representing two-thirds of the net rental earned by the defendant from the Restituted Properties since 1993 (‘award of net rental’); and
(c)	€115,772, representing an allowance for the rent-free use by the defendant of an apartment in Haštalská 12, Prague, since 1992 (‘Haštalská 12 rent allowance’).

1. The plaintiffs have now applied for interest and costs, and for an order that judgment be expressed in euros rather than in Australian dollars.

2. For the reasons that follow, I have decided that judgment be expressed in euros and that the plaintiffs be awarded:

(a) simple interest at the rates prescribed from time to time under the Penalty Interest Rates Act 1983 (Vic) (‘PIRA’) in respect of the award of…