Volvo Finance Australia Pty Limited v Waterfront Enterprises Pty. Ltd. (in liq) (No 3)

[2020] NSWSC 877

Supreme Court

New South Wales

Medium Neutral Citation:

Volvo Finance Australia Pty Limited v Waterfront Enterprises Pty. Ltd. (in liq) (No 3) [2020] NSWSC 877

Hearing dates:

25 June 2020

Date of orders:

25 June 2020

Decision date:

25 June 2020

Jurisdiction:

Common Law

Before:

Cavanagh J

Decision:

The fourth defendant is to pay the plaintiff's costs up to 26 September 2018 on an ordinary basis and as and from 27 September 2018 the fourth defendant is to pay the plaintiff's costs on an indemnity basis.

Catchwords:

COSTS — party/party — bases of quantification — indemnity basis — whether offers made in accordance with principles in Calderbank v Calderbank

Cases Cited:

Calderbank v Calderbank [1975] 2 All ER 333

Volvo Finance Australia Pty Limited v Waterfront Enterprises Pty. Ltd. (in liq) (No 2) [2020] NSWSC 262

Category:

Costs

Parties:

Volvo Finance Australia Pty Limited (Plaintiff)
Waterfront Enterprises Pty. Ltd. (in liquidation) (First Defendant)
Jason Paul Spencer (Second Defendant)
Waterfront Group Pty Ltd (in liquidation) (Third Defendant)
Barry Saad (Fourth Defendant)

Representation:

Counsel:
E Anderson (Plaintiff)
G Carolan (Fourth Defendant)

Solicitors:
Dowd & Co (Plaintiff)
MCK Lawyers (Fourth Defendant)

File Number(s):

2018/125351

Publication restriction:

None

REVISED EX TEMPORE Judgment

1. This matter comes before me today on the question of costs. As set out in my judgment of 20 March 2020, I found in favour of the plaintiff against the fourth defendant in the sum of $571,814. [1] I invited the parties to make submissions on costs.

   1. Volvo Finance Australia Pty Limited v Waterfront Enterprises Pty. Ltd. (in liq) (No 2) [2020] NSWSC 262.

2. The plaintiff seeks the following costs orders:

1. the fourth defendant to pay the plaintiff's costs on an ordinary basis up to and including 11 July 2018 and thereafter on an indemnity basis from 12 July 2018; or, in the alternative,

2. the fourth defendant to pay the plaintiff's costs on an ordinary basis up to and including 26 September 2018 and thereafter on an indemnity basis from 27 September 2018.

3. Mr Anderson of counsel again appears on behalf of the plaintiff and Mr Carolan of counsel again appears on behalf of the fourth defendant.

4. The reason that the plaintiff seeks indemnity costs either from 12 July 2018 or 27 September 2018 is that it says that it made offers in accordance with Calderbank v Calderbank [1975] 2 All ER 333 on 11 July 2018 and again on 26 September 2018.

5. The plaintiff also drew attention to a letter of 29 June 2018 said to be a third alternative offer in accordance with Calderbank v Calderbank.

6. Proceedings were originally commenced in the District Court. The proceedings were then moved to this Court. The plaintiff filed a summons essentially seeking orders for the possession of five Mack trucks and trailers and damages. As I detailed in the original judgment, the plaintiff commenced proceedings against four defendants but ultimately proceeded only against the fourth defendant.

7. The primary question of fact on the hearing was whether the fourth defendant had any or sufficient control or possession or dominion over the five vehicles at any relevant time between the time when they went missing from the premises of the fourth defendant's business and their recovery at later times in 2018 and 2019. I found in favour of the plaintiff on the basis that I was satisfied that the fourth defendant had such possession, control or dominion over the five vehicles at all relevant times.

8. The plaintiff relies on an affidavit of Bara Karlsdóttir, affirmed 4 June 2020, annexed to which is the relevant correspondence between the parties, being correspondence between June and September 2018 essentially relating to the giving up of the vehicles to the plaintiff.

9. On 27 June 2018, the solicitors for the fourth defendant wrote to the solicitors for the plaintiff stating that the fourth defendant only had the Mack superliner and dog trailer (identified as Vehicle 5 in my judgment) in its possession. The fourth defendant offered to deliver that vehicle to the plaintiff and forego his company's entitlement to be paid for his services, being services which are again the subject of comment in my earlier judgment.

10. The plaintiff responded through its solicitors on 29 June 2018, offering to discontinue the proceedings on the basis that all five vehicles were delivered to the plaintiff within seven days. It suggested that the unsecured debt alleged to have been owed by Waterfront Enterprises was immaterial to the plaintiff's claim. The vehicles were not delivered up to the plaintiff during that period. The letter said nothing about the question of costs or any consequential orders.

11. Then, on 11 July 2018, the plaintiff, through its solicitors, again wrote to the solicitors for the fourth defendant. The offer is set out in the penultimate paragraph of the letter. Essentially, the plaintiff's solicitors said that they were instructed to seek recovery of the remaining four trucks and trailers from the fourth defendant or, alternatively, seek information leading to the recovery of those goods. It was said that should either the goods not be returned in full or information not be provided by the fourth defendant which leads to the return of the goods in full, then the solicitors will seek the plaintiff's instructions to proceed against the fourth defendant in a claim in detinue or conversion forthwith.

12. The terms of that offer are uncertain. The plaintiff was pursuing the fourth defendant on the basis that the fourth defendant had control or possession of the vehicles. On the other hand, it might be seen to be corresponding with the fourth defendant on the basis that he did not have possession of the vehicles. It does not seem to me that the terms of that offer necessarily specify what might happen to the proceedings should the fourth defendant have complied with the request of the plaintiff.

13. The fourth defendant did return Vehicle 5, albeit the fourth defendant has consistently maintained that Vehicle 5 was not in his personal possession but was in possession of his company, Truck Tech Pty Ltd.

14. In any event, on 26 September 2018, the plaintiff's solicitors wrote to the solicitors for the defendant in a letter headed "Without prejudice save as to costs". In that letter, reference was made to the defence filed by the fourth defendant and alleged deficiencies in that defence. Reference was also made to the evidence already served by the plaintiff contrary to the fourth defendant's position.

15. As the plaintiff's solicitors asserted, the plaintiff had served comprehensive affidavits setting out statements made by the fourth defendant that it had possession of all five vehicles. Again, I made a finding consistent with the proposition, that is, that the fourth defendant had possession of all five vehicles.

16. The offer made by the plaintiff on 26 September 2018 was that it would pay $50,000 to the fourth defendant for information leading to the successful recovery of the remaining four vehicles and upon the vehicles being successfully recovered, then the plaintiff would dismiss all proceedings against the fourth defendant with no order as to costs. The offer was said to be made in accordance with the principles detailed in Calderbank v Calderbank.

17. By the time of this offer, the fourth defendant had returned Vehicle 5. He was maintaining that he was not in possession, custody or control of the other four vehicles. Indeed, he was maintaining he had no knowledge as to their whereabouts. I have not accepted that position as set out in my judgment.

18. Whilst it might be viewed as somewhat unusual for the plaintiff to offer to pay money to the defendant, the offer must be viewed in the context of the subject matter of these proceedings. The plaintiff was entitled to possession of five very expensive commercial motor vehicles that had gone missing. The motor vehicles had a considerable value.

19. Plainly, the fourth defendant has achieved a worse result than this offer because he has been ordered to pay the sum of $571,814 to the plaintiff. By the terms of this offer, the fourth defendant was afforded an opportunity to resolve the proceedings. The offer is specific as to what would happen to the proceedings and what would happen in respect of costs.

20. In the circumstances, I accept that the plaintiff is entitled to indemnity costs from the date of that offer. The costs order I make is thus that the fourth defendant is to pay the plaintiff's costs up to 26 September 2018 on an ordinary basis and as and from 27 September 2018 the fourth defendant is to pay the plaintiff's costs on an indemnity basis.

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Endnote

Decision last updated: 08 July 2020