On 23 August 2024, reasons for judgment were published and orders were made in this matter (see Christer Nominees Pty Ltd v Calabria Community Club Ltd [2024] NSWSC 1071). The Court gave judgment for the plaintiff in the amount of $419,137.08 and directions were made for the parties to seek to agree interest.
On 30 August 2024, the plaintiff filed a notice of motion in which it sought to amend the judgment amount, so that it would read $1,328,274.31 plus interest. The plaintiff relied upon rr 36.16 and 36.17 of the Uniform Civil Procedure Rules 2005 (NSW). The plaintiff also sought an order that the defendant pay its costs of the notice of motion on an indemnity basis.
The plaintiff's concern is that the judgment amount is insufficient when the Court's intention was to order that it receive all outstanding commission fees. According to correspondence annexed to an affidavit dated 30 August 2024 by the plaintiff's instructing solicitor, Mr Daniel Paske, the plaintiff contends the proper amount to be $1,279,274.15. This amount is said to represent the commission agreed by the defendant to be payable on the outstanding commission. The plaintiff sought the defendant's consent to having the judgment amount corrected.
The defendant declined to give its consent, contending that the slip rule was inapplicable because the Court had consciously and deliberately rejected the figure the plaintiff contended to be correct and had adopted a different figure.
The defendant did not otherwise dispute the accuracy of the figure sought by the plaintiff in the letter dated 23 August 2024, although it was initially suggested that the invoices inadequately supported that figure. Incidentally, the figure identified in that letter differs from the amount specified in the notice of motion, a matter which was pointed out in the hearing this morning.
For the following reasons, I reject the defendant's position.
I consider that the Court has power to correct the figure under r 36.16(3A), which empowers the Court to vary or set aside an order where an amendment is sought within 14 days of the order having been formally entered and on application by a party. I consider that these requirements have been met here.
Christer Nominees Pty Ltd v Calabria Community Club Ltd [2024] NSWSC 1142 | Case summary | Zoe
I also accept the need, as Mr Finnane of counsel, who appeared today for the defendant, pointed out, that the power should be exercised with caution. In my view it is proper that it be exercised in an appropriate case where an order has been affected by some "irregularity".
It is well-settled that such an irregularity includes a situation where the Court has proceeded on a "misapprehension of the facts". As the Court of Appeal said in Power v Deputy Commissioner of Taxation (No 2) [2014] NSWCA 77 at [3]:
There is no doubt that the Court has power to re-open a judgment or order to reconsider a point. It may do so if it is convinced that, in the earlier consideration of the point, it has proceeded on a misapprehension as to the facts or the law, or there is some matter calling for review, or the interests of justice so require. However, a heavy burden rests upon the applicant for re-opening to show that such an exceptional course is required, on the assumption that there has been no fault on the part of the applicant (see De L v Director-General, NSW Department of Community Services (No 2) (1997) 190 CLR 207 at 215). The Commissioner has not suggested that there has been any fault on the part of Mr Power that would preclude his making this application.
This is a case where the Court has proceeded on a misapprehension as to the facts. I consider that it is also in the interests of justice that the Court's clear intention be reflected in the judgment amount.
As is made clear in the earlier reasons for judgment at [76], the Court considered that the amount claimed by the plaintiff was that recorded in Mr Willis' affidavit at [127], where he deposed that the total amount claimed for outstanding commission fees was $419,137.08. This gave rise to a misapprehension as to the facts on the part of the Court.
The plaintiff must accept some responsibility for what has occurred. It left it to the very end of the previous oral hearing, and after it had completed its reply, to provide what counsel described as an "aide memoire" which it was said would assist the Court with "mathematical issues" regarding the amount of the claim. The Court declined to accept the aide memoire, stating that it was for the parties to "work out interest and the like".
The plaintiff's post-hearing correspondence with the defendant concerning the Court's misapprehension is also far from clear. In its solicitor's letter dated 23 August 2024, the plaintiff initially contended that the correct amount of outstanding commission is $1,652,976.50 which, together with GST in the amount of $165,297.65, brought the total amount payable to $1,818,274.15. The letter then added that, taking into account the $490,000 previously paid by the defendant, the outstanding commission was $1,328,274.15 including GST.
In support of that claim the letter referred to part of the exhibit in Mr Willis' affidavit dated 21 July 2023, which appeared in the Court Book at page 654. The difficulty, however, is that a final figure of $1,328,274.15 does not appear in that document. Instead, a final figure of $1,508,481.82 is identified.
To compound the confusion, the plaintiff's letter dated 23 August 2024 then claims that the judgment amount should be corrected to $1,279,274.15 which, as noted above, was said to represent the commission already agreed by the defendant to be payable and the interest on the outstanding commission.
The reference to an agreed figure appears to be a reference to a figure identified in a document styled "Memorandum of Agreed and Disputed Facts". That document was never tendered in evidence (see [15] of the original reasons for judgment concerning the figure which appears in [1.9] of that Memorandum).
These discrepancies were raised by the Court at the hearing of the motion this morning. Mr Wallis, who appeared for the plaintiff, confirmed that the amount that was claimed by the plaintiff in the notice of motion should be amended in a minor way such that the figure read $1,328,274.15. He also ultimately contended, and I accept, that the invoices that were adduced in evidence at the previous hearing support the plaintiff's contention that that is the proper amount of outstanding commission fees.
There was a dispute between the parties as to what interest should be paid on the judgment amount. Two separate sheets were handed to the Court which reflect various possible scenarios relating to interest. In essence, the dispute between the parties boils down to the question whether interest should be paid on a simple or compound basis. The contractual source of the obligation to pay interest is to be found in cl 11.4 of both the agency agreements:
11.4 If either the Agent or the Principal fails to pay when due and payable an amount of money owing to it under this Agreement, then the party from whom money is owing must pay interest to the other party at the rate of 6 percent (6%) per annum plus any associated costs incurred to collect monies owing. Such interest will accrue on the amount overdue on a daily basis and will be payable in respect of the period from the date that such money is due and payable to the date of actual payment, and will be payable on demand.
I accept Mr Finnane's submission that the issue of what amount of interest is payable is to be determined as a matter of construction of the agency agreements and cl 11.4 in particular. I also accept Mr Finnane's submission that, properly construed, cl 11.4 provides that interest will accrue on a daily basis and that this is consistent with the notion of simple interest being the appropriate measure. Significantly, cl 11.4 does not say that interest will capitalise on a daily basis. I accept that a provision for daily accrual should not be read as meaning daily capitalisation. I do not accept the intermediate position advanced by the plaintiff as is reflected in sheet 2, which was handed to the Court, which is not supported by the terms of cl 11.4.
For all these reasons the Court will make the following orders:
1. Applying rule 36.16 of the Uniform Civil Procedure Rules 2005 (NSW), order (1) made 23 August 2024 is varied so as to read: "The plaintiff have judgment in the amount of $1,328,274.15, plus interest."
2. The amount of interest to which the plaintiff is entitled is $359,641.18.
After I delivered ex tempore reasons for judgment in respect of the plaintiff's notice of motion filed on 30 August 2024, two further applications were made orally. The first is an application by the defendant for a stay of 28 days of the orders relating to the plaintiff's notice of motion. In my respectful view, no sufficient basis has been demonstrated by the defendant to deny the plaintiff the fruits of its victory, and I decline to grant a stay (see Alexander v Cambridge Credit Corporation Ltd (receivers appointed) (1985) 2 NSWLR 685 at 693-695).
The second application is made by the plaintiff. It seeks an order for indemnity costs in respect of the primary proceeding. I interpolate here that, as I indicated this morning, there would be no order as to costs as to the plaintiff's notice of motion filed on 30 August 2024.
The application for indemnity costs applies to the previous proceeding. That application was said to be based on four matters. First, cl 11.4 of the agency agreements, which I have set out above in my ex tempore reasons for judgment. The second basis is the defendant's conduct in the proceedings. The third matter relied upon is a Calderbank offer which was made by the plaintiff under cover of a letter dated 6 March 2024 by its solicitors, Piper Alderman. The fourth matter is a second Calderbank offer, which was made by Piper Alderman under cover of a letter dated 25 July 2024. I shall deal with each of those four matters in turn.
As to cl 11.4, I do not accept that, properly construed, it entitles the plaintiff to receive an order of costs in the legal proceedings on an indemnity basis. Although cl 11.4 refers to a liability to pay any associated costs incurred to collect moneys that are owing, that falls far short of stating with any degree of clarity that such costs are to include legal costs, let alone legal costs on an indemnity basis.
Turning to the second matter, namely, the defendant's conduct of the proceedings, there are various aspects of that conduct that are relied upon as warranting indemnity costs. They include the fact that the defendant did not press its cross-claim, nor did it press all parts of its defence, nor did it read any of the affidavit material which it had filed. I have no doubt that those matters undoubtedly put pressure on the plaintiff's resources in order to respond to them.
Having said that, however, those decisions were forensic decisions taken by the defendant. I regard them as having been made in a bona fide and responsible way with a view to narrowing the issues in dispute between the parties. I do not regard the defendant's conduct of the proceedings to have been unreasonable or irresponsible in a way which would warrant a grant of indemnity costs.
Turning to the first of the Calderbank offers in the letter dated 6 March 2024, the defendant offered to compromise the proceedings by paying an amount of approximately $1.5 million. Apparently this was intended to include both interest and legal costs as is reflected in the fact that the offer contained an express provision that the settlement be on the basis that there be no order as to costs. Mr Finnane properly accepts that the plaintiff has enjoyed a higher success under the orders that I have made today than is reflected in this letter.
I accept Mr Finnane's submission that it was not unreasonable for the defendant to have rejected the offer. As the matters which have arisen today well illustrate, there were many aspects of the plaintiff's case which left something to be desired. That case, unfortunately, had several significant uncertainties insofar as the amount of damages or debt is concerned. I do not regard it as unreasonable for the defendant to have rejected that offer.
The same can be said in respect of the second Calderbank offer in Piper Alderman's letter dated 25 July 2024. The amount the subject of that offer is probably less than the plaintiff's ultimate success in the proceedings but in my view the defendant acted reasonably in rejecting that offer for similar reasons to those that I have given above concerning the first Calderbank offer.
For those reasons, I decline to make a special costs order in respect of the substantive proceedings. The orders which are made by the Court on 23 August 2024 concerning costs are costs payable on the ordinary basis.
[2]
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Decision last updated: 06 September 2024