LINDSAY J: The central question in these proceedings is whether, upon an objective assessment of the evidence, the plaintiff and the first defendant (at any time between January and October 2011 or thereabouts) reached a concluded agreement for the plaintiff to buy, and for the first defendant to sell, 49% of the share capital in the second defendant. The basic principles (summarised in Mushroom Composters Pty Ltd v IS & DE Robertson Pty Ltd [2015] NSWCA 1 at [59]-[63] and Masters v Cameron (1954) 91 CLR 353 at 360-362) are not in dispute.
The second defendant is a company of which the first defendant is and was at all material times the sole shareholder and director, and through which (in association with other companies owned or controlled by him, particularly Wearnes International Holdings Ltd) he conducted, or proposed to conduct, a business of importing from China, and supplying to customers in Australia, stationery and school uniforms. It no longer trades. It remains a corporate manifestation of the first defendant, but merely a shadow.
The active parties in the proceedings are the plaintiff (a Chinese national) and the first defendant (an Australian citizen). The second defendant took no part in the proceedings independently of the first defendant.
During the course of the final submissions, at the instigation of the first defendant, the parties agreed that orders disposing of the proceedings should include an order joining the second defendant (in the principal proceedings and on the cross-claim) in order to dispose of any formal objection that it is a necessary party to the proceedings. Through senior counsel acting for the first defendant, the second defendant consented to its joinder, appeared in the proceedings and submitted to the orders of the court.
There is no harm in this as a means of aiding the determination of all questions in dispute between the plaintiff and the first defendant, and binding the second defendant to the outcome; but, in reality, no substantive relief is claimed against or by the second defendant and, in my assessment, any dealings between the parties were dealings between the plaintiff and the first defendant.
It does not follow from the fact that shares in the second defendant were the subject, or the intended subject, of such dealings that the second defendant is a necessary party to a determination of disputation about the nature and legal consequences of those dealings. Potential for confusion lay in the form of draft contracts exchanged (in April and May 2011) between the plaintiff and the first defendant (or their solicitors) which named the second defendant as a party, and in the first defendant's intermingling of the affairs of his companies and himself; but the essential character of any agreement at issue is an agreement between the plaintiff and the first defendant for the sale, and purchase, of shares in the second defendant.
For the sake of convenience, I refer to the second defendant by that designation, though the order for its joinder is made only in the Court's final orders.
If the court finds that there was a concluded agreement for the sale and purchase of shares, it is common ground that that agreement constituted a contract. By a cross claim, the defendants seek an order that "the contract" be specifically performed (Turner v Bladin (1951) 82 CLR 463 at 472-473) and, further or alternatively, damages.
If the court finds that there was no contract:
(a) the plaintiff seeks to recover, in restitution, as moneys had and received, a total sum of approximately $282,000 paid by him to the first defendant, in anticipation of a contract being made, as "instalments" of an agreed purchase price (representing payments totalling about $212,000 of an agreed purchase price of $294,000) for shares and $70,000 paid as a contribution to the cost of the first defendant's purchase of stock.
(b) the first defendant contends, first, that the plaintiff is bound by an estoppel (the elements of which, the parties agree, are those identified by Brennan J in Waltons Stores (Interstate) Limited v Maher (1988) 164 CLR 387 at 428-429) that precludes him from denying the absence of a contract.
(c) alternatively, the first defendant contends that he is entitled to resist the plaintiff's restitutionary claim on the basis of a "change of position" defence governed by principles enunciated in Australian Financial Services and Leasing Pty Ltd v Hills Industries Ltd (2014) 253 CLR 560.
The plaintiff contends that he is entitled to recovery of his money on the basis that there has been a total failure of consideration in that he has, in fact, received no part of benefits bargained for under any agreement made with the first defendant: David Securities Pty Limited v Commonwealth Bank of Australia (1992) 175 CLR 353 at 382-383; Baltic Shipping Company v Dillon (1993) 176 CLR 344 at 350-351B; Roxburgh v Rothmans of Pall Mall Australia Limited (2001) 208 CLR 516 at 555-558; Equuscorp Pty Limited versus Haxton (2012) 246 CLR 498 at 517-518 and 545.
Negotiations between the plaintiff (represented from time to time by his wife, Ms Li) and the first defendant occupied the period between May 2010 and October 2011 or thereabouts.
An in-principle agreement for the sale and purchase of 49% of the shares in the second defendant was made at a meeting held, in Sydney, in January 2011. That agreement was oral, but reached by reference to a "PowerPoint presentation" made by the first defendant, in the course of which it was agreed between the plaintiff, his wife and the first defendant (through an interpreter) that each party would obtain legal advice, moving towards execution of a written contract through the medium of solicitors, before any transfer of shares.
The PowerPoint presentation prepared by the first defendant contemplated the payment of $294,000 for the shares by three instalments. The first instalment was described as an "initial deposit" of $50,000. The second instalment, of $194,000, was described as payable "[once] Contracts are signed & Shares are Transferred". The third instalment, of $50,000, was to be payable "[within] 45 Days from Contract signing & Share Transfer".
In his discussion with the plaintiff and the plaintiff's wife at their January 2011 meeting, the first defendant encouraged them to take a printed version of his PowerPoint presentation to a solicitor as a foundation for consideration of a written contract to be signed after they had attained legal advice.
Under the heading "Business Operation", after a list of points made about the prospective operation of the second defendant under the joint ownership of the plaintiff and the first defendant (intended, I infer, to provide to the plaintiff comfort that the affairs of the second defendant would be conducted in accordance with sound legal, accounting and regulatory principles), the presentation incorporated a statement to the effect that the contract to be prepared for the parties' execution would include "[whatever] else the Lawyers see fit and proper as this contract will protect both parties equally".
Between January and October 2011 the parties, through solicitors and personally, engaged in inconclusive, ongoing negotiations about the content of the written contract to be signed. Throughout that time, the plaintiff was represented by a solicitor. The first defendant, having initiated the process of negotiations through a solicitor, appears to have dispensed with the services of his solicitor. He appears, also, to have become exasperated by the process of negotiating contract terms.
So much so that, when the plaintiff changed solicitors and his new solicitor (not without sound professional reasons) suggested, in October 2011, that the parties' draft contract should be substantially re-drafted, the first defendant terminated negotiations, bringing the process of contract negotiations, substantially, to an end.
The process of contract negotiations was accompanied by persistent demands made by the first defendant that the plaintiff pay instalments of the purchase price for shares in the second defendant, and contribute to the cost of his acquisition of stock, as a demonstration of good faith. So it was that, between 18 February 2011 and 17 June 2011 the plaintiff paid to the first defendant a total of $281,995.
$15,000 was paid on 18 February 2011. Another $45,000 was paid on 14 March 2011. On 4 May 2011 $36,985 was paid by instalments of $31,985 and $5000. On 9 May 2011 $13,010 was paid by instalments of $5000, $5000 and $3010. On 10 May 2011 $70,000 (arguably referable to stock acquisition rather than an instalment of purchase money) was paid. On 11 May 2011 $5000 was paid. On 16 May 2011 $10,000, by two instalments of $5000, was paid. On 17 May 2011 a further $5000 was paid. On 20 June 2011 $82,000 was paid.
In and after August 2011, the plaintiff resisted payment of a final instalment of $82,000 demanded by the first defendant by reference to draft Share Sale Agreements. Had he paid that amount he would have paid the whole of the prospective purchase price of shares in the second defendant, plus a $70,000 contribution towards stock acquisition. He refused to make the final payment unless and until a contract was signed. The first defendant refused to sign any contract unless and until all payments earlier contemplated were made.
The first defendant relied heavily on the fact of the plaintiff's payments having been made, claiming that, on the plaintiff making his first payment on 18 February 2011, the parties became contractually bound to complete the share sale contemplated in their oral discussions based on his PowerPoint presentation.
There was a broad correspondence between the plaintiff's payments and the instalment time line proposed in draft Share Sale Agreements, the first of which was prepared by the first defendant's solicitor. A variety of drafts exchanged hands. A draft dated "April 2011" provided (in part, retrospectively) for payments to be made on 18 February 2011 ($15,000), 1 March 2011 ($45,000), 3 May 2011 ($70,000), 17 June 2011 ($82,000) and 17 August 2011 ($82,000). This timetable constituted a variation of a draft dated "March 2011" that nevertheless provided for instalments to be paid between 18 February 2011 and 15 August 2011. A later draft dated "May 2011" varied the April timeline by substituting "10 May 2011" for "3 May 2011". The April and May drafts (but not the March draft) provided for the plaintiff to pay the first defendant $70,000 for "future stock orders" on execution of the contract.
Approbating and reprobating, the first defendant increasingly refused to sign any written contract unless and until he was paid the whole of the purchase price of the shares; he retained all the share capital of the second defendant for his own use; he remained the sole director of the second defendant; and, from time to time, he threatened both to forfeit all money paid by the plaintiff, and to sue the plaintiff for damages, should the plaintiff not pay the "outstanding balance" of the purchase price for shares in the second defendant as and when demanded.
From a legal perspective, the first defendant's demands may not have been uniformly consistent but, from a commercial perspective, their consistency dwelt in his desire to have his cake and to eat it too.
In my assessment, the plaintiff and his wife did not commit the plaintiff to anything that, construed objectively and in all the circumstances of the case, could reasonably be taken as an agreement on the part of the plaintiff to be immediately bound to a contract or to abandon the parties' agreement that there would be no contract at all unless and until they both signed a written agreement with the benefit of legal advice. Taken out of context, snippets of evidence can be found to suggest otherwise; but context is important.
The context in which the parties' negotiations took place favoured pursuit of a process governed by an agreement (which, I find, objectively, the parties made) that they would not be contractually bound unless and until they signed a written contract prepared by solicitors, with each party able to obtain independent legal advice. This was for the protection of both parties and, at least initially, but not consistently thereafter, perceived by the first defendant to be so.
The parties were separated by significant language and cultural differences. The plaintiff and his wife spoke no English. Though married to a Chinese woman, and experienced in trade with China, the first defendant did not speak Chinese. Both sides required an interpreter for all written and oral communication. The plaintiff and his wife needed the assurance of a written contract because they saw themselves as investing in an Australian business in aid of applications for their immigration to Australia. They needed to satisfy the Australian Government of the terms of their investment and their commitment to its ongoing viability. They needed the ground rules of a prospective, ongoing business relationship to be clearly laid out before they bound their fate to a contract.
The closest the parties came to a concluded agreement occurred on 10 May 2011 when the then solicitor for the plaintiff sent an email to the first defendant, notifying him of Mrs Li's agreement to a drafting amendment earlier sought by him, and recording that "Mrs Li [who, it might be accepted, acted as agent for the plaintiff] advised that she will make the transfer [of $70,000 demanded by the first defendant] this afternoon once you accept the amendment agreement and confirm that the agreement is effective as at 10 May 2011". On that same day Mrs Li transferred $70,000 to the first defendant on the plaintiff's account.
The conjunction of this email and that payment is misleading. The parties were never ad idem as to the terms of their proposed contract. Although they met, in China, on 10 May 2011 they did so without reference to the email. Moreover, as it was written in English (not comprehensible to the plaintiff or his wife) they were not cognisant of it.
Be that as it may, the solicitor's email was written expressly in the context of a need for a written confirmation by the first defendant of the terms of the parties' putative "agreement" and execution of a contract document, at the office of the solicitor of the plaintiff, upon the first defendant's return to Sydney.
No written confirmation of any agreement was forthcoming in any event. By an email dated 10 May 2011, the first defendant responded to the plaintiff's solicitor's email in terms that expressly declined to sign any agreement without the first defendant obtaining legal advice, sought additional amendments to the latest draft, and demanded full payment of the purchase price for shares in the second defendant as a precondition of his execution of any contract.
This was the high point of the parties' negotiations. The first defendant continued to press for drafting amendments. Through solicitors, the plaintiff continued to press the first defendant to sign a contract. And the first defendant continued to demand the payment of money as a precondition to his signing any contract.
Several emails to this effect were exchanged in August 2011, at a time when, it seems, the plaintiff and his wife became more insistent that a contract be signed before the payment of any further money to the first defendant. On the first defendant's presumptive timeline for the payment of instalments, a final instalment (of $82,000) was "payable" on 17 August 2011. It was not made.
In September 2011 the plaintiff and his wife looked around for a new solicitor.
In mid October 2011, the first defendant (not for the first time) threatened the plaintiff and his wife with legal action. A face to face meeting, in Sydney, on 19 October 2011 resolved nothing. When the plaintiff's new (and current) solicitor emailed him, the first defendant was unresponsive. By 28 October 2011 the parties' relationship had broken down completely. The first defendant, that day, emailed the plaintiff's new solicitor with a declaration of a refusal "to participate or even think about further negotiations".
For the plaintiff's part, at about the same time as the first defendant became unresponsive, he despaired of ever procuring a signed contract from the first defendant; he felt excluded from any participation in the business conducted by the first defendant by reference to the second defendant; he questioned the bona fides, or accuracy, of the first defendant's earlier assurances that the second defendant had a viable business; and, having obtained a temporary residence visa, he doubted the utility of continuing to press the first defendant for execution of a written contract.
On 19 December 2011 the first defendant sent the plaintiff a "final demand for payment" incorporating a series of other demands, and suggesting that the plaintiff might acquire the whole of the second defendant. Expressed in terms of a demand or offer, it was, in substance, an empty gesture, an abandonment of the earlier proposed co-operative venture.
This development reflects, at least in part, the collapse, in October 2011, of the school related stationery and uniform business that the first defendant had been attempting to build up since 2009, before incorporation of the second defendant on 5 February 2010. The one substantial group of customers with whom the defendants had earlier transacted business (Assyrian Schools) declined to accept a quotation for further supplies.
The fact remains, the parties at no time agreed upon the terms of a contract, let alone signed a written contract, before their ongoing negotiations, and their business relationship, broke down entirely.
Towards the end of 2011, the first defendant broke off communications with the plaintiff. On 25 July 2012 the plaintiff's solicitor sent him a letter of demand that culminated in the commencement of proceedings.
The parties' debate about whether or not the plaintiff and the first defendant were bound by contract focused largely on the analysis of "conditional agreements" found in Masters v Cameron (1954) 91 CLR 353 at 360-362, supplemented by an ancillary allusion to Baulkham Hills Private Hospital Pty Limited v GR Securities Pty Limited (1986) 40 NSWLR 622 at 628D-G.
Within that frame of reference, the plaintiff contended that this case falls within the third category identified in Masters v Cameron: the intention of the parties, he contended, was not to make a concluded bargain at all, unless and until they executed a formal contract. The first defendant contended for the first of the Masters v Cameron categories: the parties reached finality in arranging all the terms of their bargain and, he said, intended (in February 2011) to be immediately bound to the performance of those terms, but at the same time proposed to have the terms restated in a form which would be full or more precise, not different in effect.
On my findings, the plaintiff's characterisation of the facts is the correct one.
This case is not unlike those in which parties agree that they will not be bound by a contract unless and until there is an exchange of contract counterparts through the agency of solicitors (Allen v Carbone (1975) 132 CLR 528; Sindel v Georgiou (1984) 154 CLR 661; Eccles v Bryant and Pollock [1948] Ch 93) although, here, the critical event was the "signing" a written contract prepared by lawyers rather than an "exchange" of contracts.
The parties' contract debate also traversed cases such as Brogden v Metropolitan Railway Co (1877) 2 App Cas 666 and Empirnall Holdings Pty Limited v Machon Paull Partners Pty Limited (1988) 14 NSWLR 523 upon an exploration whether, notwithstanding non-execution of a written agreement earlier contemplated as the form of contract, a contract could be inferred from conduct, consistent with the form of written contract, falling short of formal execution of it.
In this context, the first defendant relied heavily upon the plaintiff's acquiescence in the payment of instalments of an agreed purchase price. The instalments were not paid precisely within the timetable contemplated by the in-principle agreement said by the first defendant to have emerged from his PowerPoint presentation of January 2011. They were closer to schedules of instalments for which draft Share Sale Agreements provided in April and May 2011 and to which the plaintiff generally adhered. Nevertheless, the first defendant at no time transferred shares to the plaintiff as had been contemplated by both parties, he retained sole ownership and operational control of the second defendant, negotiations for a written contract were ongoing, and payments made by the plaintiff to the first defendant were expressions of commercial good faith on the part of the plaintiff rather than compliance with any contractual obligation.
In a marginal note with which the first defendant annotated a copy of the April 2011 draft Share Sale Agreement, he recorded against the instalment schedule the following comment (with emphasis added):
"The delay in payment has caused my company to delay the process of ordering our new product and the local purchasing of the required product at heavy cost therefore.
If payments are not made on May 3rd then I have no alternative but to seek compensation for all the loses [sic] that I have incurred.
Showing good faith by the purchaser these payments must be made even if the contract are [sic] not finalised."
In the context of the dealings between the plaintiff and the first defendant, I take the first defendant's reference to "good faith" as corroborative of the evidence of the plaintiff and his wife to the effect that all payments made by the plaintiff were "good faith" payments, title to which was contingent upon a written contract being signed. I accept their evidence, expressed with substantial consistency, on a point of particular, fundamental importance to their planning to migrate to Australia.
In cross-examination, the first defendant confirmed that in early May 2011 he pressed the plaintiff and the plaintiff's wife for further payments "as a show of good faith".
The nature of the parties' dealings led, naturally, to references to Brambles Holdings Limited v Bathurst City Council (2001) 53 NSWLR 153 and 0rmwave Pty Limited v Smith [2007] NSWCA 210 at [68]-75] because of difficulties involved in isolating any clear, identifiable offer and acceptance as constituting a contract.
Life is messy, not analytically convenient. In light of that reality, it is relevant to ask (as Heydon JA asked in Brambles Holdings Limited v Bathurst City Council at 179 [81]): in all the circumstances can an agreement be inferred? Has mutual assent been manifested? What would a reasonable person in the position of the plaintiff and a reasonable person in the position of the first defendant think as to whether there was a concluded bargain?
Taking into account all the surrounding circumstances (as contemplated by Universal Music Australia Pty Ltd v Pavlovic [2015] NSWSC 791 at [73]-[90], citing, inter alia, Australian Broadcasting Corporation v XIVTH Commonwealth Games Limited (1988) 18 NSWLR 540 at 548G-551D), these questions must, in my assessment, be answered in the negative, there was no concluded agreement. The parties made no contract although each had an intention that, at some stage, by means of a signed contract negotiated by solicitors, they would enter into contractual relations. In the event, that was not to be.
In the absence of a concluded agreement, there is no contract, notwithstanding that the first defendant, or the second defendant, may have taken steps in the conduct of their business in anticipation of a contract: Mushroom Composters Pty Ltd v IS & DE Robertson Pty Ltd [2015] NSWCA 1 at [63].
In the absence of a finding of contract, attention turns to the first defendant's contention that the plaintiff is bound by an estoppel to the same substantial effect as if the parties bound themselves in contract.
As is not uncommonly the case (TMA Australia Pty Ltd v Indect Electronics & Distribution GMBH [2014] NSWSC 409 at [87]), the parties agreed to litigate the question of estoppel by reference to the principles governing equitable estoppel formulated by Brennan J in Walton's Stores (Interstate) Limited v Maher (1988) 164 CLR 387 at 428-429.
Adapting his Honour's formulation to the present proceedings, the parties have accepted that, in order to make out a claim of equitable estoppel, the first defendant must prove that:
(a) the first defendant had assumed that a particular legal relationship existed between the plaintiff and himself or expected that a particular legal relationship would exist between them and, in the latter case, that the plaintiff would not be free to withdraw from the expected legal relationship;
(b) the plaintiff had induced the first defendant to adopt that assumption or expectation;
(c) the first defendant acted or abstained from acting in reliance on the assumption or expectation;
(d) the plaintiff knew or intended the first defendant to do so;
(e) the first defendant's action or inaction will occasion detriment if the assumption or expectation is not fulfilled; and
(f) the plaintiff has failed to act to avoid that detriment, whether by fulfilling the assumption or expectation or otherwise.
The first defendant's evidence of his subjective state of mind is capable, in parts, of sustaining a finding that he assumed that a contract existed between the parties in and from January or February 2011. However, he appears to have persuaded himself that, he having extracted payments from the plaintiff as a demonstration of the plaintiff's good faith, the parties were in a contractual relationship notwithstanding their explicit agreement that any contractual relationship between them would be dependent upon the execution of a written contract, and ongoing, ultimately inconclusive negotiations about the terms of such a contract.
Taken as a whole, and viewed through a prism of what is reasonable, the evidence does not support a finding that the first defendant assumed that a contract existed between the parties, or a finding that the plaintiff (either himself or by Ms Li acting as his agent) induced the first defendant to adopt such an assumption.
Nor am I satisfied that the first defendant acted, or abstained from acting, in reliance upon an assumption that a contract existed between the parties. Before and during, if not after, the plaintiff's negotiations with the first defendant, the first defendant (intermingling the affairs of himself, the second defendant and at least one other corporate vehicle through which he traded, Wearnes International Holdings Ltd) pursued opportunities to expand his business activities. He did that, I find, on his own initiative and for his own benefit, independently of any belief he held about the existing state of his contractual relationship with the plaintiff, extracting payments from the plaintiff as and when he could, and reserving to himself a right to disclaim any contract as and when it suited him to do so.
I find that each of the payments made by the plaintiff to the first defendant (including the payment of $70,000 as a contribution to stock acquisition) was made, as the first defendant well knew, conditionally upon the parties signing a written contract, prepared via their respective solicitors.
The defendants have not made out the elements of an estoppel.
That being so, the cross claim must be dismissed and, subject to consideration of the first defendant's "change of position" defence, the plaintiff's claim for recovery of his money on an action for moneys had and received must succeed.
The plaintiff received no part of any benefit bargained for when, in January 2011, he agreed in principle to purchase 49% of the shares in the second defendant, when he subsequently paid instalments of purchase price as a demonstration of good faith or when, on a similar basis, he paid money as a contribution to the acquisition of stock: David Securities Pty Limited v Commonwealth of Australia (1992) 175 CLR 353 at 382-383. The first defendant continued his sole ownership and control of the second defendant, and any business nominally attributable to the second defendant, reserving to himself a right to sign a contract, or not, as it suited his own interests. He cannot, in good conscience, retain the benefit of the plaintiff's money.
The first defendant's "change of position" defence must fail, on my findings: that he received and spent money of the plaintiff in circumstances in which, viewed objectively, he must be taken to have understood that any entitlement he had to appropriate that money was contingent upon the execution by the parties of a written contract, which never occurred (and which, for his part, he ultimately declined to bring about).
His expenditure of money paid to him by the plaintiff is not, of itself, enough to establish the defence. He spent the money, on his own responsibility, in circumstances in which he held firmly to his sole ownership and control of the second defendant and, ultimately, declined to sign any written contract. He well knew, or ought to have known, that the plaintiff's payments were contingent upon the parties' execution of a written contract. He took a risk that he could develop a retail, as well as a wholesale, stationery and school uniform business as an adjunct to his earlier established furniture business. He endeavoured to do that with the plaintiff's money. It would be inequitable for the first defendant to retain the benefit of that money; there is nothing inequitable in the plaintiff's claim that it be repaid: Australian Financial Services And Leasing Pty Ltd v Hills Industries Limited (2014) 253 CLR 560 at 583 [27], 592 [65]-596 [77] and 625 [157]-626 [158].
For these reasons, I make the following orders and notations dispositive of the proceedings:
(1) Order that Office Deals Pty Ltd ACN 141870840 be joined as a party in these proceedings as a defendant and cross claimant.
(2) Order that the defendants be designated as follows:
(a) Robin Cohen is designated the first defendant.
(b) Office Deals Pty Ltd ACN 141870840 is designated the second defendant.
(3) Order that the cross claimants be designated as follows:
(a) Robin Cohen is designated the first cross claimant.
(b) Office Deals Pty Ltd ACN 141870840 is designated the second cross claimant.
(4) Order that any requirement that amended pleadings be filed, consequentially upon the joinder of Office Deals Pty Ltd, be dispensed with.
(5) Judgment for the plaintiff against the first defendant in the sum of $281,995, plus interest on that sum under the Civil Procedure Act 2005 NSW, s 100.
(6) Order that any claim for relief made by the plaintiff against the second defendant be dismissed.
(7) Reserve to the plaintiff liberty to apply for an order that interest under the Civil Procedure Act 2005, s 100 be quantified.
(8) Order that the cross claim be dismissed.
(9) Order that the first defendant/first cross claimant pay the plaintiff/cross defendant's costs of the proceedings.
(10) Reserve to the parties liberty to apply, by a notice of motion filed no later than seven days after the making of these orders, for an order that that costs order be discharged or varied.
If there is agreement about quantification of interest the agreed amount can be added to the judgment debt by orders made in chambers. If there is a contest, I will deal with it at a time convenient to the parties and the Court.
The order for costs here made follows the general rules that costs follow the event (Uniform Civil Procedure Rules 2005, rule 42.1) and that costs are assessed on the ordinary, rather than the indemnity, basis (UCPR rule 42.2), treating the second defendant's joinder as a formal expedient in aid of the substantive contest between the plaintiff and the first defendant. If there is any occasion to review this approach, it can be dealt with by a motion filed pursuant to the liberty to apply referred to that purpose.
[3]
Amendments
24 February 2016 - Amended citations of: Brambles on coverpage & in para 51; and reference to Heydon JA in para 51.
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Decision last updated: 24 February 2016