Solicitors:
Anne McDonald Lawyers (Plaintiff)
File Number(s): 2020/94610
[2]
JUDGMENT
Judgment for possession of land at Milbrodale owned by Mr and Mrs Brown was given in favour of Mr King in 2020 by Davies J, in circumstances where Mr and Mrs Brown's unrepaid borrowings had increased to "$2,314,093.43 (CAD $2,342,756.00)": King v Brown [2020] NSWSC 1010 at [1]-[5].
A dispute over calculation of what had to be repaid and a cross-claim brought by Mr and Mrs Brown were dealt with in King v Brown (No 2) [2021] NSWSC 1060. There I concluded that the amended cross-claim had to be dismissed and directed that final orders be formulated to reflect the conclusions which I had reached as to the disputed calculations. In King v Brown (No 3) [2021] NSWSC 1116 final orders were made in terms sought by Mr King, for reasons there given.
There was not then any suggestion that proceeds of sales, which had to be taken into account in the orders made, had been received.
Mr and Mrs Brown later appealed and Mr King sought an order for security for costs. His application was dismissed: Brown v King [2022] NSWCA 75. On the hearing of Mr King's motion he made a concession that while also not raised in the notice of appeal, the September 2021 orders had not accurately recorded the amounts Mr and Mrs Brown still owed him. That was because in the calculations considered in King v Brown (No.3), account had not been taken of the fact that by the time the orders were made, the proceeds of the sales had been received, but their receipt had not been disclosed.
In Brown v King Kirk JA observed that the problem Mr King raised was one which could be addressed by an application made to me, as the primary judge: at [47].
That application was later made by motion, supported by an affidavit sworn by Ms McDonald, Mr King's solicitor. There sought were orders under r 36.17 of the Uniform Civil Procedure Rules 2005 (NSW) and/or the Court's inherent jurisdiction, that the amounts of CAD2,134,924 in orders 1, 4 and 7 of the orders made on 2 September 2021, be reduced by CAD2,026.672.40 to CAD108,251.60.
Mr and Mrs Brown notified the Court that they did not propose to appear at or participate in the hearing of the motion, which thus proceeded ex-parte.
At the hearing the orders sought in the motion were amended in terms which were favourable to Mr and Mrs Brown. This was the result of further consideration of the relevant exchange rate, by reference to data published by the Reserve Bank, undertaken before the hearing, which Ms McDonald explained in a second affidavit.
The correction of the orders pressed was thus that the judgment for CAD2,134,924 made on 2 September 2021 in orders 1,4 and 7 be reduced by CAD2,030,903.90 to CAD104,020.10.
[3]
The orders pressed must be made
I am satisfied that the orders Mr King pressed must be made, unopposed as they were.
In her first affidavit Ms McDonald explained how the application came to be made. There she said that she was a sole practitioner with a busy practice, at the time that the orders pressed in 2021 were arrived at, while she was working from home under difficult conditions, without the assistance of her staff. Those conditions, she explained, were the result of restrictions which had been imposed as a consequence of the COVID-19 pandemic.
At that time Ms McDonald was also working on the settlement of the sales of the property and the business conducted there. She explained how the purchase price had to be adjusted on settlement in respect of various disbursements and settlement directions; how the orders which Mr King pursued were arrived at and settled with counsel; as well as how a 30 August 2021 certificate certifying what remained owing by Mr and Mrs Brown came to be signed by Mr King and provided to the Court, when the orders which he asked to have made were pursued in 2021.
Ms McDonald also explained that it was due to an inadvertent oversight on her part that she had omitted to draw to the attention of either counsel or the Court, that the sales of the business and property had completed on 26 August 2021, when the proceeds of the sales had been received. That should have been taken into account in the orders, but she had overlooked that necessity.
Ms McDonald attributed her oversight to all of the matters she explained she was then working on, under the difficult conditions she explained and the associated pressure of running her own practice and servicing all her clients during the COVID-19 lockdown.
Ms McDonald also said that she had not sought to mislead the Court. She proffered an apology to the Court, which I am satisfied should be accepted.
Further, Ms McDonald's explanation should not be doubted. Neither Mr nor Mrs Brown questioned her explanation that she made her admitted error at a time when she was busy working on complex matters under challenging conditions.
Neither Mr nor Mrs Brown appeared to challenge the calculation advanced by Mr King of what the orders which the Court made against them in 2021 should have provided for. Nor did they oppose the Court making the orders Mr King sought, nor suggest that the Court, as presently constituted, does not have jurisdiction or power to rectify the error in the orders which Mr King acknowledged by his motion, had been made.
Rule 36.17 empowers the Court to correct an error in an order arising from an accidental slip or omission, on application of a party such as Mr King, even after an order has been entered, as it has in this case. That rule is intended to permit corrections when there is no difference of opinion as to the error which has occurred. There is no difference between the parties in this case.
I am thus satisfied on the evidence that the circumstances fall into the class to which this jurisdiction is intended to apply and that on the evidence, justice requires that the orders pressed be made.
Even if the rule did not apply, I consider that this would be an appropriate case for the Court to exercise its inherent power to correct the error which has been made, that power extending to "an omission resulting from the inadvertence of a party's legal representative": L Shaddock & Associates Pty Ltd v Parramatta City Council (No 2) (1982) 151 CLR 590; [1982] HCA 59 at 594. This is such a case.
Mr and Mrs Brown cannot justly be deprived of account being taken of the proceeds of the sales received before the orders were made, in what they were ordered to pay Mr King in respect of their unpaid borrowings.
The orders which I will now make must thus take effect from the date of the original orders, that not affecting any third party.
[4]
Costs
It is also necessary to deal with the costs of the motion.
That was not addressed in the motion or the written submissions advanced for Mr King, who did not seek an order as to costs.
It was a matter which I raised at the hearing and was addressed after instructions were taken from Mr King.
In the circumstances it was plain that the costs of the motion pursued to rectify Ms McDonald's error could not justly be borne by Mr and Mrs Brown. That was accepted by Mr King, who properly did not seek any order against them.
The circumstances were such that a question arose as to whether the costs should be borne by Ms McDonald, there being no suggestion that Mr King had any involvement in or responsibility for her admitted error, which would not have occurred if proper attention had been paid to how the proposed orders had to be calculated, given the receipt of the proceeds of the sales.
Human error is understandable. Given the difficult conditions under which work had to be performed by members of the legal profession like Ms McDonald at times during the COVID-19 pandemic, that she made the error she explained can be accepted. But there were resulting unnecessary costs incurred, which must be dealt with by the Court.
Mr King did not, however, seek a costs order against Ms McDonald, who would have had to be heard if he did. In the result the appropriate costs order is that there be no order as to costs.
[5]
Orders
For these reasons I order that:
1. The judgment for CAD2,134,924 made on 2 September 2021 in orders 1, 4 and 7 be corrected by being reduced by CAD2,030,903.90 to CAD104,020.10, effective from the time that the orders were made.
2. There be no order as to the costs of the motion.
[6]
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Decision last updated: 17 October 2022