Ronstan International Pty Ltd v Thomson [2002] VSCA 107

Court of Appeal (Vic)|2002-07-25|Before: BUCHANAN, CHERNOV and EAMES, JJ.A.

Judgment - Order for repayment of money paid pursuant to a judgment varied on appeal - Interest on sum overpaid - Rate of interest.

Costs - Partial success of appeal - Order for portion of costs.

On 8 August 2000 the appellant satisfied the judgment awarded by the trial judge by payment of the sum of $239,434.69 to the respondent. The appellant also paid $3,227.60 to the respondent for interest in respect of the period between the date of judgment and the date of payment. The judgment substituted by this Court was in the sum of $175,058.86.

Accordingly, the appellant is entitled to be repaid the sum of $64,375.83. The appellant seeks an order for repayment of that sum together with, the proportion of the additional interest in respect of the period after the judgment that was paid on the overpaid portion of the original judgment amount, which produces an amount of $65,221.44, and interest on those sums from 8 August 2000 until the date of repayment. The rate proposed by the appellant is 7% per annum.

It is well settled that a party who has satisfied a judgment for the payment of money is entitled by way of restitution on the reversal or variation of the judgment to repayment of the money paid, with interest.[1] The respondent has not advanced any argument against an order for repayment of the sum overpaid and interest thereon, but contends that the rate of interest should be 3.5% per annum. In support of the rate of 7% the appellant has referred to the fact that on 3 August 2000 the respondent deposed that he would apply the amount of the judgment in reduction of his debt to two banks. In support of the rate of 3.5% the respondent cites the rates declared by the Senior Master on Common Fund No. 1 for the years 1 June 2000, 1 June 2001 and 1 June 2002, which were 4% per annum, 4% per annum and 3% per annum respectively.

The juridical basis of the right to interest on moneys paid under judgments either reversed or set aside is the common law concept of unjust enrichment.[2] The purpose of the award is to restore to the successful appellant that which has been taken from him. It is not to restore him to his former position by awarding damages to compensate him for the loss flowing from the erroneous judgment. Apart from reference to an earlier affidavit in which the respondent deposed to his intended use of the fruits of judgment, the parties have not sought to lead evidence as to any return which the respondent may have achieved on the sum paid pursuant to the judgment. In any event we do not think such an enquiry is appropriate. Like Callaway, J.A. in Meerkin & Apel v. Rossett Pty. Ltd. (No. 2)[3], we will use our own experience and memory of rates during the relevant period to strike a rate which in our view does justice as between the parties in all the circumstances of the case. We propose to allow interest on $65,221.44 at 6% per annum for the period from 8 August 2000 until repayment of the sum overpaid.

In his written submissions the respondent submitted that the amount of the sum to be repaid by the respondent should be reduced to reflect the fact that the appellant paid $4,410.00 less than the amount of the invoice rendered by the respondent on 28 March 1995. In our view the submission seeks to agitate the correct amount of the set-off, a matter which has been determined after full argument.

As to costs, at the hearing of the appeal the respondent accepted that if the appellant was entitled to a set off, the amount of the set off was that contended for by the appellant. The error made in the calculation of the amount of the set off occupied no time during the hearing of the appeal. Nevertheless it was not until the hearing that the respondent conceded that the amount of the set off had been miscalculated. The appellant only redressed the error by appealing. Accordingly, although the appellant otherwise failed to establish any of the grounds of appeal, we think it appropriate that it should recover a proportion of its costs. We will order that the respondent pay 30% of the appellant's costs of the appeal.

The cross-appeal wholly failed. In our view the costs should follow the event. The respondent relied upon the fact that the trial judge did not apportion the costs although the respondent failed on the question of penalty. In our view different considerations apply on appeal. The cross-appeal was a discrete part of the proceeding. The Taxing Master can apportion the costs between appeal and cross-appeal. Accordingly, we will order that the respondent pay the appellant's costs of the cross-appeal.

[1] See The Commonwealth v. McCormack [1984] HCA 57; (1984) 155 C.L.R. 273; National Australia Bank Ltd. v. Bond Brewing Holdings Ltd. [1991] VicRp 31; [1991] 1 V.R. 386; Meerkin & Apel v. Rossett Pty.Ltd. (No. 2) [1999] VSCA 10; [1999] 2 V.R. 31.

[2] National Australia Bank Ltd. v. Bond Brewing Holdings Ltd. [1991] VicRp 31; [1991] 1 V.R. 386 at 597 per Brooking, J.; Heydon v. N.R.M.A. (No. 2) [2001] NSWCA 445 at [14] per Mason, P.

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