Interchase Corporation Limited (in liq) v Grosvenor Hill Queensland) Pty Ltd

[4] Subsequently, the statement of claim was further amended on 4 July 2000 to raise further matters by way of defence to the Bank's claim for repayment of moneys advanced together with interest and recovery of possession of the land mortgaged to secure repayment by Mr Amos.

[5] The pleadings are voluminous and it is unnecessary for me to analysis the various assertions in the action Mr Amos pursued through extensive pleadings between November 1996 and July 2000.

[6] It suffices to say that on 17 July 2000, a mediation was held in the course of which Mr Amos and the Bank agreed to settle their dispute.

"2 Amos agrees to pay to the Bank $530,000.00 in the following instalments -

(a) Amos will also pay to the Bank the Bank's costs of the actions;

(b) The Bank's costs of the actions will be assessed by Monsour by a short form assessment on a solicitor and client basis (within the meaning of that phrase before the commencement of the Uniform Civil Procedure Rules); Monsour will be instructed to divide his assessment between costs incurred before 1 July 2000 and costs incurred thereafter;

(c) The short form assessment of the Bank's costs by Monsour will be binding on Amos and the Bank and neither Amos nor the Bank may appeal or otherwise challenge the assessment;

(d) Amos will pay to the Bank the amount of the assessment by the later of:

(i) 14 days from the date on which the assessment is notified to Amos' solicitors, Keller Nall & Brown; or

[8] Clause 5 of the agreement then sets out the rates of interest payable on the money if paid in accordance with the agreement and also provides for a default rate should the moneys not be paid by instalments as agreed.

"6 if Amos fails to make any of the payment referred to in clauses 2, 3 and 5 by the due times for payment then:

(a) Amos hereby irrevocably consents to the Bank entering judgment in the action for the sum outstanding on the date of entry of judgment and for recovery of possession of the land by filing the request for consent judgment which is attached to this agreement.

(b) Amos hereby irrevocably authorises Mallesons Stephen Jaques to insert the amounts in paragraph 1 of the judgment and the date of judgment."

"9 Each of Amos and the Bank hereby releases and discharges the other from all claims, costs, causes of action, debts, damages or demands of any nature other than liabilities arising under this agreement."

"10 The Bank will give Amos a discharge of the mortgages upon payment to the Bank of the last to be paid of the amounts referred to in clauses 2, 3 and 5 above."

[12] Clause 11 makes provision relating to discharge of mortgages held by the Bank should Amos re-finance his indebtedness or sell any of the properties subject to the mortgage.

(a) he has received legal advice about the terms of this agreement and

(d) Amos' obligations under this agreement are secured by the mortgages"

[14] Attached to the settlement agreement is a form of consent judgment, cl 1 of which is judgment for moneys owing for principal, costs, and interest and cl 2 of which is consent to delivery of possession of the mortgaged properties to the Bank. It was contended that judgment ought be given in favour of the Bank for recovery of possession rather than delivery of possession and there was no argument advanced at the contrary should there be no triable issue raised by the defendant on the Bank's application. Clause 3 of the consent order provides for payment of the Bank's costs on a solicitor and client (indemnity) basis.

[15] Initially, Mr Amos opposed the Bank's application for summary judgment on the settlement agreement on the grounds that it had been procured by or through the Bank's fraud. However, upon the hearing of the application, perhaps unsurprisingly, this assertion was abandoned and it was conceded that Mr Amos did not now assert that the agreement had been procured by the Bank's fraud.

[16] The following matters however were raised as triable issues -

(1) Certain of the allowances made Mr Monsour were not properly chargeable against Mr Amos. In particular experts had been retained by the Bank to prepare reports and make calculations based upon at least "four scenarios" raised upon the plaintiff's pleadings. These reports were never finalised or completed although it emerges that there must have been a good deal of discussion between the Bank and various accountants and other persons retained to prepare evidence for use upon the Trial. Unsurprisingly, when the action between Amos and the Bank was settled the persons involved were not further retained to complete their reports and advices. It was contended that Mr Monsour was wrong in making any allowance in respect of costs incurred by the Bank in commencing to have their statements-reports prepared in anticipation of trial on the basis that the Bank "did not rely on these reports and on the other hand seek to charge them to my client."

[17] In my view there is no substance in this contention. However quite apart from the correctness of this submission there is no doubt in my view that under clause 3(c) of the agreement to which I have referred it is not open either to the Bank or to Mr Amos to challenge the figure allowed by Mr Monsour.

[18] It was also contended on behalf of Mr Amos that the partly prepared statements-reports in respect of which costs were awarded ought to have been disclosed to him prior to the agreement being executed on 17 July 2000.

[19] It was contended that if aware of the various "scenarios" canvassed by the accountants retained by the Bank in anticipation of alternative findings of fact that might be made should the matter go to trial, Mr Amos would not or may not have agreed to pay the sum of $530,000.00 under clause 2 of the settlement agreement.

[20] In my view, on the material, the various reports, calculations etc had been made as a consequence of discussions between the Bank and its accountants and other expert's upon forged handwriting, but no completed reports had ever been prepared and indeed none was ever made. The notations, drafts, statements, etc had obviously been prepared for the purpose of litigation and the communication of them to the Bank was privileged, albeit that had the reports ever been completed and become expert reports, they would have lost that privilege under the rules. In this respect I would adopt with respect the observations of Thomas J in Interchase Corporation Limited (in liq) v Grosvenor Hill (Queensland) Pty Ltd 1999 1 Qd R 141 at p 162 and those of Pincus JA at p 153.

[21] In spite of the clear wording of clause 3(c) of the agreement it is contended on behalf of Mr Amos that he is permitted to appeal to this court against the assessment of Mr Monsour asserting that he has wrongly allowed costs against Mr Amos. It is asserted on his behalf that this Court ought send the assessment back to Mr Monsour with directions that certain amounts which have been allowed not be allowed.

[22] The second contention raised on behalf of Mr Amos is that he is being "over charged by the Bank to the tune of $13,535.17".

[23] Subsequent to the agreement, apparently Mr Amos retained accountants to consider upon all the material which had apparently been assembled for the purpose of the mediation, and perhaps other material, whether indeed the Bank could contend that $530,000.00 was due to it upon 17 July 2000. The accountant retained by Mr Amos concluded that Mr Amos was indebted to the Bank on his calculations in the sum of $13,535.17 less than the $530,000.00 that he had agreed his indebtedness to be upon the mediation.

[24] In my view on the material there were clearly a number of possible outcomes of any trial of the action on the issues raised in the pleadings which must have been before the mediator. In my view, both parties were clearly bound under the terms of the agreement to accept that the sum of $530,000.00 was the sum which Mr Amos would pay to the Bank in settlement of the dispute between them. Had the matter gone to litigation the sum finally determined may well have been more than that sum or less than that sum. It is asserted on behalf of Mr Amos that he was "misled" by the Bank asserting that he owed it more than the sum which his accountant asserted was owing subsequent to the agreement being executed. Counsel for Mr Amos agreed that he really wished to go behind the agreement on the ground of what his accountant had advised him subsequent to the agreement being made. He asserts that Mr Amos was not "given the Bank's calculations" and that he should have been. He said the failure to provide him with the Bank's calculations prior to the execution of the agreement was a sufficient reason to set it aside.

[25] Mr Amos failed to comply with the time constraints of making the final payment under clause 2 of the agreement. He obtained extensions of time within which to make payment. However, an application for a further extension of time was refused by the Bank and then for the first time questions of fraud and improper assessment of costs were raised. Unsurprisingly, when payment of moneys due under the agreement was not effected within the extended time allowed by the Bank to comply with clause 2, the Bank attempted to register the consent judgment which was made part of the settlement agreement. However, solicitors for Mr Amos disputed the validity of this agreement and the Registrar declined to make the order to which the solicitors for Mr Amos had consented, which was annexed to and part of the settlement agreement.

[26] It is for this reason that the Bank applies for judgment in terms of that draft consent judgment. The Bank does not attempt to canvass the various matters raised in the voluminous pleadings which were exchanged between the parties prior to the settlement agreement being reached upon the mediation of 17 July 2000. The Bank simply seeks an order in terms of that consent order.

[27] At the hearing of the application reference was made to various of the "scenarios" upon which interest payments might be calculated. I do not propose to embark upon consideration of those matters. It suffices to say that on one of the four "scenarios" canvassed by accountants retained by the Bank as at 17 July it has been calculated that there was the sum of $528,433.00 owing for principal and interest.

[28] In my view, the appropriate time for Mr Amos to obtain accounting advice and to make calculations as to the amount of money owed to the Bank was prior to the execution of the settlement agreement. In my view, it is simply not open to him to place before this court calculations from an accountant made six months after the settlement agreement was reached showing that arguably something less than $530,000.00 was owing to the Bank.

[29] In my judgment Mr Amos has raised no triable issue as to the enforceability of the settlement agreement reached between him and the Bank on 17 July 2000. I therefore make the following orders -

(a) That Edward Amos pay to National Australia Bank the sum of $294,507.10.

(b) National Australia Bank recover possession from Edward Amos of the following properties:

(i) Lot 6 on Registered Plan No. 33864, being all the land comprised in volume 3187 Folio 179 in the County of Stanley, Parish of Toombul known as 830 Sandgate Road, Clayfield;

(ii) Lot 25 on Registered Plan No. 33643, being all of the land contained in Volume 1885 Folio 13, County of Stanley, Parish of Toombul known as 247 Lancaster Road, Ascot;

(iii) Lot 5 on Registered Plan No. 34738, being all the land contained in Volume 3090 Folio 183, County of Stanley, Parish of Toombul known as 118 Oriel Road, Clayfield; and

(iv) Lots 3 and 4 on Registered Plan No. 34378, being all the land contained in Volume 2348 Folio 149, County of Stanley, Parish of Toombul known as 116 Oriel Road, Clayfield.

[30] I order that Edward Amos, the plaintiff by claim and defendant by counterclaim, pay to National Australia Bank Limited its costs of and incidental to this application to be assessed on an indemnity basis.