Dr N Kalokerinos Pty Ltd v Jain

Background

1. At first instance in NCAT, Mr Jain also brought proceedings claiming damages in respect of a breach of the retail lease by DNK as lessor. He was unsuccessful in those proceedings, and the Senior Member ordered the proceedings be dismissed and directed or ordered that he pay the costs of DNK as agreed or assessed.
2. In the proceedings brought by DNK, Senior Member Bluth made the following orders: "1. [Jain] is to pay [DNK] the sum of $60,025.34 and interest pursuant to section 72(1)(a) of the Retail Leases Act 1994 (NSW). 2. DNK is entitled to claim the bond of $5,200 and any accrued interest held by the Rental Bond Board and Mr Jain is to sign all necessary release documents to assist the applicant in claiming the bond. 3. Jain is to pay the costs of DNK as agreed or assessed."
3. Mr Jain successfully appealed to the Appeal Panel of NCAT, who published its judgment on 30 May 2023. So far as his own application was concerned, Mr Jain was awarded nominal damages, the Appeal Panel being unsatisfied that the evidence permitted any greater award. In relation to the appeal from Senior Member Bluth's judgment in COM 22/02033, the Appeal Panel varied the orders pronounced by Senior Member Bluth: the order for damages was reduced to a sum of $18,318.25, Order 2 was undisturbed, and no order was made in relation to the costs of the appeal.
4. DNK by summons sought leave to appeal to this Court under s 83 of the Civil and Administrative Tribunals Act 2013 (NSW). Mr Jain cross-appealed and by his cross-summons of 21 July 2023, inter alia, sought an order in relation to proceedings COM 22/02033 in the following terms: "1. The respondent is to pay the applicant the sum of $4,034.53 and interest pursuant s 72(1)(a) of the Retail Leases Act 1994 less any amounts paid by the Rental Bond Board."
5. Two things are obvious. One is that Mr Jain was seeking another substantial reduction in the damages to which DNK was entitled, but was also, by necessary implication, challenging Senior Member Bluth's Order 2 in respect of the rental bond.
6. As I have said, in the event, that cross-appeal was successful and I made orders in favour of Mr Jain substantially reducing the damages awarded by the Appeal Panel to the sum of, on my calculations, $4,134.53. I did not make any order in respect of the rental bond that had been paid to DNK in accordance with Senior Member Bluth's Order 2 and, as I have been instructed by the argument of counsel on the hearing today, the provisions of the Retail Leases Act 1994 (NSW).

Slip Rule

1. Rule 36.17 UCPR provides: "If there is a clerical mistake, or an error arising from an accidental slip or omission, in a judgment or order, or in a certificate, the court, on the application of any party or on its own motion, may, at any time, correct the mistake or error."
2. I interpolate, in considering whether to exercise the power conferred upon me by this rule, in common with all other powers conferred under the Civil Procedure Act 2005 (NSW) or the UCPR, I am required to give effect to the overriding dictates of s 56 Civil Procedure Act: see for example National Australia Bank v Satchithanantham [2012] NSWSC 1474 at [15].
3. The crux of Mr Jain's application is that the orders, as they currently stand, work an injustice in that they would allow DNK to retain the bond, and also to enforce Senior Member Bluth's Order 1 as varied by me. Ms Lim of counsel, who appears for Mr Jain, presses upon me that this may be contrary to the express provisions of s 16I of the Retail Leases Act. I interpolate, if this is so, then one wonders why an application is being made under the slip rule.
4. DNK contends that the slip rule does not apply. Mr Vuu of counsel, who appears for DNK argues that, while mentioned in the cross-summons, no mention of Order 2 made by the Senior Member was raised in either written or oral submissions before me. He refers to R v Birks (1990) 19 NSWLR 677 to emphasise that a party is bound by the conduct of his or her legal representatives and submits that there can be no serious suggestion that Mr Jain had been deprived of a fair opportunity in this Court to challenge expressly Order 2. He also argues that there was no slip; rather, this application is an afterthought. In this regard he refers to R v Agritraders Ltd [1983] QB 464 at pp 470-1.
5. Ms Lim argues that there was a slip. She accepts that she omitted or overlooked mentioning Order 2 in the course of written or oral submissions but relies upon the cross-summons and the considerations referred to by the High Court of Australia in L Shaddock & Associates Pty Limited v Council of the City of Parramatta (No 2) (1982) 151 CLR 590; [1982] HCA 59. I commended counsel on her frankness in relation to the matter. I should also say that the formulation of the orders in the cross-summons were overlooked by me at the time I prepared my judgment.

Slip rule decision

1. To Shaddock (No 2) one might add a reference to Agritraders Limited. In the passage to which Mr Vuu referred, the Court of Appeal said: "...we have no reason to doubt that the inherent jurisdiction of this court would enable us to reconsider an order for costs, so as to enlarge it in some particular way, if we were satisfied that the omission to make the material application was due to a genuine accidental omission on the part of counsel."
2. I am satisfied that the slip rule applies in this case. As White J (as his Honour then was) observed in J Aron Corporation v Newmont Yandal Operations Pty Limited [2006] NSWSC 849; (2006) FLR 359 at [61], the Court's jurisdiction under r 36.17 exists (at [61]): "...even where the Court has acted deliberately and without error in framing its order on the basis of the case presented to it but there is an omission resulting from the inadvertence of a party's legal representative in not raising a point at the hearing." His Honour made reference to Shaddock (No 2). His Honour's judgment was approved on appeal in Newmont Yandal Operations Pty Limited v J Aron Corporation (2007) 70 NSWLR 411; [2007] NSWCA 195 by the whole court constituted by Spigelman CJ, Santow and Handley JJA.
3. By reference to these authorities, the candid statement of counsel and my own part in the oversight and having regard to Mr Jain's substantial success in these proceedings, I am satisfied that the failure to draw the need to address Order 2 to my attention is the type of mistake, accidental slip or omission which r 36.17 is designed to address. I am satisfied that ordinarily some correction should be made in the interests of justice and in compliance with the proper exercise of the r 36.17 power. The question is what order should be made.
4. I confess to having been a little slow to catch on to certain matters put to me during the course of argument. It seems, however, to be common ground between counsel that the force and legal effect of s 16I Retail Leases Act, notwithstanding my failure to vary or alter Order 2 pronounced by Senior Member Bluth, is that the payment of the bond to DNK operates, to that extent, in satisfaction of the judgment pronounced at first instance as varied by me on appeal.
5. What s 16I(1) makes clear is that the secretary of the Rental Bond Board is obliged, on being served with, or obtaining, a copy of the orders of NCAT, to pay out the amount of money held by the board on deposit in respect of the subject lease "as if the secretary were the person obliged to pay under the judgment or order". Section 16I(3) provides: "For all purposes, money paid out by the Secretary under subsection (1) is taken to be money paid by the person against whom the judgment was obtained, or the order was made." It is quite clear that the receipt of the amount of the bond by DNK, by force of those provisions, is received in satisfaction of order 1 in COM 22/02033 as varied by me by Order 5 I pronounced on 23 August 2024.
6. As I have said, I was somewhat slow on the uptake. At the very heel of the hunt, when I expressed my concern about the form of the orders proposed by the notice of motion filed on 24 October 2024, I was informed that all that was sought was a notation to the effect that DNK had received the sum of $5,200 plus interest on 6 January 2023 lest there be some ambiguity in respect of Order 1 as varied by me and Order 2 as originally pronounced by Senior Member Bluth at first instance. When I raised with her what appeared to be the insufficiency of the proposed order, Ms Lim frankly told me that no order for restitution was sought as to any excess. In effect, I was told by learned counsel from the bar table that any right to recovery of the undoubted overpayment was abandoned or waived by Mr Jain.
7. That being so causes me to consider whether it is necessary for me to pronounce any further order or to act upon my findings to actually correct any order I pronounced. The legal effect of my decision in relation to COM 22/02033 is that, when Order 1 as varied by me is read with original Order 2, which is unaltered, together, there is no scope for ambiguity given what counsel have demonstrated by reference to the legal effect of s 16I of the Retail Leases Act. It seems to me that the section speaks for itself and operates by its own force; no order is required to carry it into effect. Perhaps this is what counsel were attempting to impress upon me at the start of the argument but were unable to penetrate my obtuseness.
8. Upon reflection, while I am satisfied that, as I have said, r 36.17 UCPR is properly engaged, I am not satisfied that there is any legal utility in me correcting the orders, given that no order for restitution is sought for the overpayment, as it has been abandoned. Accordingly, there is no practical injustice, which was my primary concern, that needs to be remedied by correction under the slip rule. As I have said, as varied by me, the orders of Senior Member Bluth are quite clear, and the legal effect of s 16I Retail Leases Act is also pellucidly clear. In the exercise of my discretion, I decline to make an order under r 36.17 UCPR.

Special Order as to Costs

1. I turn then to the question of costs.
2. Although NCAT is not a "costs jurisdiction", given the provisions of s 60 of the Civil and Administrative Tribunal Act 2013 (NSW), Ms Lim drew to my attention paras [225]-[227] of the Appeal Panel's decision setting out the principles usually applied in NCAT in cases like that at hand (see [2023] NSWCATAP 141). Mr Vuu accepts that the principles, with respect to the Appeal Panel, are correctly stated in that passage.
3. The restrictions in s 60 are somewhat moderated by the provisions of r 38 of the Civil and Administrative Tribunal Rules 2014 (NSW), as explained in Vella v Mir (No 3) [2020] NSWCATAP 17 (at [28]-[31]). It is not necessary for me to set out that passage in full or at all as counsel are agreed that the effect of that decision is that the practice in the tribunal is that in cases to which r 38 applies, of which this is one, the approach of the courts of ordinary jurisdiction to the exercise of statutory powers to award costs is applied. This necessarily means that the principles governing Calderbank offers and their effect upon the power to exercise the cost discretion to make a special order as to costs are applicable.
4. It seems to me that the letter of 15 July 2022 is in an appropriate form to engage the discretion to make an order as to costs on a special basis: it is headed "Without prejudice save as to costs"; it refers to Calderbank v Calderbank; and sets out, in not inconsiderable detail, why the offer proposed is an appropriate and reasonable one which should be accepted by DNK. It also states, in clear terms, that if the offer is rejected "an application by our client for costs on the indemnity basis" will be made.
5. The offer was one of a gross sum of $8,200. That included the bond. Implicitly, the landlord's entitlement to the bond was, by the formulation of the offer, in clear terms, conceded. The net offer was an additional sum of $3,000, with each party to pay his or its own costs. That offer was rejected by letter dated 26 July 2022 when DNK, through its solicitors, made a competing Calderbank offer for a much handsomer figure.
6. The end result of this is that, given my Order 5 reducing the damages recoverable by DNK from Mr Jain to the sum of $4,134.53, the amount recovered by DNK is less than half of the offer. While a Calderbank letter does not have automatic consequences for costs, it seems to me, always accepting that a Calderbank offer may, not must, excite the exercise of discretion to award indemnity costs, that the offer, in the event, and it can only ever be adjudged in retrospect, was a reasonable one and it was unreasonable for DNK to reject it.
7. In the circumstances, I amend my orders pronounced on 23 August 2024 by adding Order 9 in the following terms: 1. "Pursuant to the liberty reserved by Order 8 hereof: Vary Order 3 pronounced by Senior Member Bluth on 13 December 2022 in proceedings COM 22/02033 by setting aside that order and substituting an order in the following terms: "DNK pay Mr Jain's costs of COM 22/02033 on an ordinary basis until 26 July 2022 and on the indemnity basis thereafter".
8. I will also correct Order 5 pronounced by me on 23 August 2024, under r 36.17 UCPR, by deleting the matter 020333 and substituting the matter 02033. I will also add: Costs order otherwise in accordance with the Orders pronounced by me on 23 August 2024.
9. As a final matter, Mr Vuu has asked for costs of today. He has asked for costs on the basis that it was not clear from Mr Jain's written submissions that the Shaddock (No 2) omission, I will put it, was relied upon. Moreover, Mr Vuu contends, reading the special costs sought, there was a degree of ambiguity involved, in as much as it seemed open ended, and that indemnity costs throughout, including before the Appeal Panel and in this Court, were sought.
10. He said had there been an appreciation that the only indemnity cost in front of Senior Member Bluth were sought, there would have been no dispute as to the indemnity costs. And indeed, that was consistent with the arguments he advanced before me, although if I can say, with respect, in his usual manner, very little quarter or ground from his starting point was given.
11. It seems to me that, although substantially Mr Jain has been successful on this application, given those matters on which he relies, the consideration that I exercised my residual discretion not to make an order under r 36.17. And although Ms Lim was successful in relation to the special order as to costs, I too laboured under the mistake engendered by the ambiguity, or apparent ambiguity, in which the prayer was framed until its limited scope was made clear by Ms Lim.
12. It seems to me that in the circumstances, balancing the relative success of Mr Jain against those considerations to which Mr Vuu draws attention, that the appropriate order is: "Each party to bear his or its own costs of Mr Jain's application and of today".

Orders

1. I make the following orders: 1. Add Order 9 pursuant to the liberty reserved by Order 8 hereof: (9) Vary Order 3 pronounced by Senior Member Bluth on 13 December 2022 in proceedings COM 22/02033 by setting aside Order 2 and substituting an order in the following terms: "Dr N Kalokerinos Pty Ltd is to pay Mr Jain's costs of COM 22/02033 on an ordinary basis until 26 July 2022 and on the indemnity basis thereafter". 2. Correct Order 5 pronounced by me on 23 August 2024 under r 36.17 Uniform Civil Procedure Rules 2005 (NSW) by deleting matter "22/020333" and substituting the matter "22/02033". 3. Cost orders otherwise in accordance with the orders pronounced by me on 23 August 2024. 4. Each party to bear his or its own costs of Mr Jain's application and of today.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 14 November 2024