Bauskis & Anor v Liew

Disqualification Application 9Despite the plaintiff's non-attendance at the hearing and, for the sake of completeness I will address the matters set out in his submissions dated 12 September 2012 which seek my disqualification. The specific matters raised are as follows. 10The plaintiff complained about my conduct in the substantive hearing, in which I rejected an affidavit that he had sworn from being relied on. I referred to this in Bauskis No 1 at [5] where I summarise my reasons for doing so, namely that: "In the circumstances [the plaintiff's decision to serve the affidavit late was] equivalent to a deliberate decision by [the plaintiff] not to comply with a court order". More detailed reasons for the rejection of the affidavit were set out in my ex tempore reasons delivered on the first day of the hearing: Bauskis v Liew (unreported, 9 July 2012). Nothing in those reasons gives rise to any basis for my disqualification. 11I should note a submission that was made by counsel for the defendant concerning that affidavit today. The affidavit in question annexed schedules from the plaintiff's diaries which related to the construction of the dwellings on the two properties the subject of the joint venture between the plaintiff and the defendant. It emerged during the course of the hearing that those diaries were not, according to counsel for the defendant, the primary documents recording that work. Counsel for the defendant submits that the effect of the plaintiff's evidence was that the annexures to his affidavits had been reconstructed from other documents. At the end of the first day of the hearing, the plaintiff was provided with the opportunity to make them available but, on the second day of the hearing, he made clear he would not do so. I note that submission, but do not consider it necessary to express any view on it. 12The second matter relied on for the disqualification application is said to be my overlooking of the defendants' alleged failure to produce certain documents on subpoena. This contention is not developed. As best as I can ascertain, it appears to be a reference to some documents that the plaintiff had been seeking in order to verify the expenses said to have been incurred by the defendant in pursuing the development. In Bauskis No 1 at [46] I set out an extract from the plaintiff's affidavit where he stated that he was not interested in pursuing those documents. 13The third matter relied on is said to be my "overlooking the fraud committed by the defendant Mr Liew in not paying" the plaintiff's daughter for the purchase of the property as specified in the contract of sale for the property that was developed. The circumstances surrounding this are addressed at Bauskis No 1 at [61]-[66]. To the contrary, what emerged during the submissions was an acceptance by the defendant that an amount was payable in respect of the purchase price on the sale. This had emerged in submissions following an exchange between myself and counsel for the defendant. It occurred at a point in time when Mr Bauskis was not paying attention. 14The fourth matter listed in the submissions that is said to warrant my disqualification, is my alleged lack of knowledge of contract law, and my "temerity" in ruling that the parties' relationship was governed by the "Deed of Agreement". This is addressed in Bauskis No 1 at [34]-[41]. The contention involves no more than a dissatisfied litigant being unhappy with a court's ruling which he does not agree with. 15The fifth contention alleges that I denied the plaintiff a proper hearing, including denying adjournments, applications, and earlier request to disqualify myself. I describe the course of events at the hearing in Bauskis No 1 at [3]-[7]. The reasons for the denial of his adjournment application and the application to disqualify myself, are set out in my ex tempore reasons in Bauskis v Liew (unreported, 10 July 2012). In the end result, none of these matters warrant my disqualification and I decline to do so.

Remaining issues 16In Bauskis No 1 at [75], I identified the issues that were remaining in the proceedings from which I sought the parties' assistance: "In light of the conclusions I have reached, it will be necessary for the parties to provide supplementary submissions. They should address: (i) the calculation of the appropriate adjustment to be made in respect of GST; (ii) whether any further findings are necessary to determine that; (iii) whether Mr Liew should be required to provide some form of undertaking in relation to the payment of GST and, if so, the form of that undertaking; (iv) the final form of orders that I should make; (v) to the extent it may be relevant to those orders, the matters I have raised in [31] and [32] above; and (vi) costs." 17The matters raised in [31] and [32] as referred to in this passage, concerned some confusion on my part as to how the total sum that was paid into court of $204,163.89 could be reconciled with various settlement statements concerning the sale of the two properties. I have been advised from the bar table that the theory I enunciated at [31] concerning the outstanding amount of the deposit, is the basis for their reconciliation. It is not necessary for me to determine this matter. 18In relation to issues (i) and (ii) in Bauskis No 1 at [75], namely GST, the defendant submits that the proper amount to allow for GST is $62,745.45. This is based upon the total proceeds of sale being $950,200, and the finding in Bauskis No 1 at [65] that the purchase price was $260,000. I accept that submission and will make an allowance in the defendant's favour for that amount. 19This allowance is however conditional upon there being a proper accounting and payment of the GST figure. The defendant has indicated that an amount of $54,563.62 has already been paid for GST, but accepted that the relevant Business Activity Statement is not in evidence. I will impose as a condition of the payment out that the defendant proffers an undertaking that requires him to account to the Deputy Commissioner of Taxation for GST in respect of the sale of the properties for the amount that has been nominated, and to provide to the plaintiff copies of the Business Activity Statements concerning those payments. 20Otherwise, I will make orders for payment out of amounts representing the defendant's entitlement to rent being $23,850 (see Bauskis No 1 at [60]), and Mr Bauskis' initial contribution of land to the joint venture being $71,794.10 (see Bauskis No 1 at [61]-[66]) together with the interest components referable to those sums. This leaves a balance of $45,774.34 and the issue of costs. 21The defendant submits that overall they should have their costs of the proceedings on the basis that they have effectively been successful. Although one way of viewing the orders for payment out of the monies was that approximately half is to be paid to the plaintiff, and half to be paid to the defendant, I nevertheless agree with the defendant's submission. From the time just prior to the commencement of the proceedings up to and continuing through the hearing, Mr Bauskis sought to disavow any suggestion that he was in any form of joint venture with the defendant. Instead, he simply asserted that his company was entitled to invoice the defendant for $300,000, representing approximately $258,000 in labour and $42,000 in expenses. Those contentions occupied the bulk of the hearing. In my assessment, they represented a complete obstacle to any sensible resolution between the two parties of their positions. Mr Bauskis was wholly unsuccessful in those contentions. Accordingly, I consider it appropriate that the defendant obtain his costs of the proceedings. 22The defendant also seeks an order for indemnity costs arising out of a rejection of an offer made to the plaintiff on 8 May 2012. In a Calderbank letter sent that day, he offered to resolve the dispute by the plaintiff issuing a tax invoice for works in the amount of $140,000 which would be paid, and that he would retain the remainder. The plaintiff has done substantially worse than as stated in the letter. 23Nevertheless, I will not make an order for indemnity costs. The difficulty is that the offer was only open for three days until Friday, 11 May 2012. I am conscious that, even if the offer had been open for a longer period, it is extremely unlikely that the plaintiff would have accepted it, given the manner in which he conducted the proceedings. However, I think the offer needs to be considered on its terms stripped of a subjective analysis of the plaintiff's likely response. I would not describe the offer as unreasonable but I do not consider that an entitlement to indemnity costs would follow from the rejection of an offer made to an unrepresented litigant that only allows such a limited period of time to consider it. 24One further matter should be noted. The defendant sought to persuade me not to order the payment out of the balance of the amounts left over in the account, being $45,774.34, but to leave it in Court. In relation to the portion of that amount that would otherwise be payable to Mr Bauskis, the defendant proposes to have those monies paid out to them on account of their costs at a time when their costs have been assessed. The difficulty with that proposition is that it involves the Court granting the defendant security over those monies which the plaintiff is entitled to. I do not think it can do so. 25Accordingly: (1)Upon the undertaking of the defendant by his counsel to: (a)account to the Deputy Commissioner for Taxation for GST in respect of the sale of xx xxxxxxxxx xxxxxx, Canley Vale, and xxx xxxxxxxxx xxxxxx, Canley Vale, in the amount of $62,745.45; and (b)provide to the plaintiff copies of all Business Activity Statements concerning such payments; I order that the amount of $62,745.45 of the monies paid into court be paid out to the defendant, Nicholas Kon Ming Liew, together with 30.73 per cent of the interest earned on those monies. 26I further order that: (2)the amount of $46,737.17 of the monies paid into court be paid out to the defendant, Nicholas Kon Ming Liew, together with 22.895 per cent of the interest earned on those monies. (3)The amount of $94,681.27 of the monies paid into court be paid out to the first named plaintiff, John Peter Bauskis, together with 46.375 per cent for the interest earned on those monies. (4)The plaintiffs pay the defendant's costs of the proceedings. (5)The amended statement of claim be dismissed. (6)The amended cross claim be otherwise dismissed.

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