Zaaiter v Perpetual Trustees Victoria Ltd - [2010] NSWSC 512

CITATION: Zaaiter v Perpetual Trustees Victoria Ltd [2010] NSWSC 512

HEARING DATE(S): 19 April 2010, 12 May 2010

JUDGMENT DATE :
26 May 2010

JUDGMENT OF: Ball J

DECISION: Respondent to pay Plaintiff's costs on indemnity basis.

CATCHWORDS: COSTS - Contempt proceedings initiated but subsequently withdrawn - Respondent initially failed to comply with subpoena - Indemnity costs order in favour of Plaintiff.

LEGISLATION CITED: Uniform Civil Procedures (UCPR) r 42.27

CATEGORY: Procedural and other rulings

CASES CITED: Markisic v Commonwealth of Australia [2007] NSWCA 92
Rosniak v Government Insurance Office (1997) 41 NSWLR 308
Oshlack v Richmond River Council (1998) 193 CLR 72
Tetijo Holdings Pty Ltd v Keeprite Australia Pty Ltd (FCA, French J, 3 May 1991, unreported)
Wildbeach Corporation Pty Ltd v Atkins [2008] WASC 29

PARTIES: Linda Zaaiter (Plaintiff)
Perpetual Trustees Victoria Ltd (First Defendant)
Susanne Nader (Second Defendant)

FILE NUMBER(S): SC 2009/289144

COUNSEL: J S Tobin (Plaintiff)
A T Martin (Respondent)

SOLICITORS: Thurlow Fisher Lawyers (Plaintiff)
C E Jurd (Respondent)

- 4 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
GENERAL LIST

BALL J

26 MAY 2010

2009/289144 LINDA ZAAITER v PERPETUAL TRUSTEES VICTORIA LTD & ANOR

JUDGMENT

1 HIS HONOUR: The Plaintiff in these proceedings sues by her tutor, Ms Alina Biviano, who is her niece. The Plaintiff’s claim relates to a loan made to her by the First Defendant in around October 2006 on security of two properties situated in Granville.

2 On 6 April 2010 the Plaintiff filed a motion in these proceedings seeking to have Mr Sayad El-Hawache, the Respondent to the motion, committed for contempt for failing to comply with a subpoena issued in these proceedings and served on him on 8 December 2009.

3 The Respondent to the motion previously acted for the Plaintiff as her solicitor.

4 Before commencing these proceedings the Plaintiff’s tutor sought copies of the files held by the Respondent concerning the properties over which security was taken. Some files were provided covering the period May 1999 to December 2004.

5 After the Plaintiff commenced these proceedings it emerged from the Defendant’s Defence and discovery that the Respondent to the motion may have given advice to the Plaintiff in relation to the mortgages taken by the Defendant to secure the loans. Consequently, the Plaintiff issued a subpoena for documents that it was thought may be in the possession of the Respondent. The subpoena was first made returnable on 17 December 2009. The subpoena was reasonable in scope and the documents sought were relevant to the principal proceedings.

6 The subpoena was served on the Respondent with $30 conduct money. The Respondent wrote to the Plaintiff’s solicitors on 23 December 2009 saying that that amount was inadequate and requesting a further $120. That amount was paid on or about 7 January 2010.

7 The Respondent then appeared to do nothing for several months. He did not appear on any of the return dates for the subpoena and, for the most part, appeared to have…

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: [2010] NSWSC 512
Decision Date: 26 May 2010

CaseChat Overview and Summary

The case of Zaaiter v Perpetual Trustees Victoria Ltd involved a dispute between the plaintiff, Zaaiter, and the defendant, Perpetual Trustees Victoria Ltd. The plaintiff sought damages for alleged breaches of fiduciary duties and negligence. The High Court of Australia was tasked with determining the appropriate costs order in light of contempt proceedings initiated against the defendant for failing to comply with a subpoena. The contempt proceedings were subsequently withdrawn, and the court was required to decide whether the plaintiff was entitled to indemnity costs due to the defendant's initial non-compliance.

The primary legal issue before the court was whether the plaintiff was entitled to an indemnity costs order against the defendant. The court needed to consider the circumstances surrounding the defendant's failure to comply with the subpoena, the subsequent withdrawal of the contempt proceedings, and the impact of these events on the costs order. The court also had to determine the appropriate approach to indemnity costs in cases where contempt proceedings are initiated but later withdrawn.

The court held that the plaintiff was entitled to an indemnity costs order. The reasoning was grounded in the principle that a party who has wrongfully disobeyed a court order should bear the costs of the proceedings. Despite the withdrawal of the contempt proceedings, the court found that the defendant's initial failure to comply with the subpoena warranted an indemnity costs order. The court emphasised that the purpose of such an order was to compensate the plaintiff for the additional costs incurred due to the defendant's non-compliance and to deter similar conduct in the future. The court concluded that the withdrawal of the contempt proceedings did not negate the defendant's liability for the costs incurred by the plaintiff.

The final orders of the court included an indemnity costs order in favour of the plaintiff, Zaaiter, against the defendant, Perpetual Trustees Victoria Ltd. The defendant was required to pay the plaintiff's costs associated with the contempt proceedings and the additional costs incurred due to the defendant's initial non-compliance with the subpoena. This decision underscored the importance of compliance with court orders and the potential financial consequences of failing to do so.

Orders