HIS HONOUR: This is the third and, barring any further vexing issue, likely the final judgment in this matter. It deals with a claim for interest on a judgment sum.
On 5 October 2023, I delivered my first reasons for judgment in this matter (see Wang v Yu [2023] NSWSC 1182 (principal judgment)). These reasons assume a familiarity with the principal judgment and will adopt its nomenclature and abbreviations. Relevantly, the principal judgment made findings in favour of Mr Yu against each of Dr Wang for $200,000 and Mr Yang for $10,000 on the cross-claim. I requested the parties to prepare orders to give effect to the findings in the proceedings and cross-claim, as well as costs.
Mr Yu's cross-claim, filed on 15 April 2021, sought judgment against both cross‑defendants in the sum of $210,000, and additionally sought relief for interest pursuant to s 100 of the Civil Procedure Act 2005 (NSW).
Notwithstanding that, the forms of short minutes of order which Mr Yu (by his solicitors) on 23 November 2023, 15 December 2023 and 20 December 2023 proposed be made in addressing the cross-claim did not seek pre-judgment interest against Dr Wang and Mr Yang in respect of the judgment amounts against them.
On 20 December 2023, I made orders dealing with the substantive claims for relief in the proceedings consequential upon the principal judgment, and I reserved my decision on the question of costs. The orders made included orders for judgments in favour of Mr Yu against each of Dr Wang for $200,000 and Mr Yang for $10,000.
On 17 January 2024, I delivered reasons for judgment and made final orders dealing with costs, including set off costs: see Wang v Yu (No 2) [2024] NSWSC 4 (costs judgment).
On 12 February 2024, my Associate received an email from Lucia Naim, a solicitor in the firm of solicitors acting for Mr Yu. The email raised, for the first time, that the orders on 20 December 2023 and at the time of the costs judgment had not dealt with pre-judgment interest.
On 13 February 2024, my Associate, on my behalf, sent an email to the practitioners and to Dr Wang (who had relevantly been unrepresented by legal representatives since at least late November 2023, though she had attended or appeared in her own interests) noting that, in the absence of consent of the other parties, any application in respect of pre-judgment interest would need to be the subject of a formal application rather than being dealt with in chambers.
On 14 February 2024, Ms Naim sent an email to my Associate attaching a draft form of notice of motion, an affidavit of Mr Kammoun affirmed 14 February 2024 and an outline of written submissions.
The notice of motion relevantly sought an order pursuant to r 36.17 of the Uniform Civil Procedure Rules 2005 (NSW) (slip rule) that there be included in Order 2 made by the Court on 20 December 2023 a provision for pre-judgment interest in the sum of $84,542.14 or, alternatively, $29,583.66 on the judgment amount of $200,000 payable by Dr Wang.
No similar relief was then sought, or is now sought, in respect of the judgment amount against Mr Yang.
On 16 February 2024, I listed the matter for mention at 9:00am on 22 February 2024. Ms Sidey, the solicitor for Mr Yang, sought to be excused from attendance on that mention in the context in which no relief was being sought against her client. I excused her attendance and have also excused any subsequent attendance on behalf of Mr Yang.
On 22 February 2024, Mr Kammoun, solicitor, appeared on behalf of Mr Yu. There was no attendance by or on behalf of Dr Wang, notwithstanding that she had been notified of the listing. I took the precaution of having Dr Wang called outside court on that occasion, but there was no appearance by her.
So that I could understand the precise basis for the relief being sought, I requested Mr Kammoun to outline the nature of the claim and the basis for it. I did that expressly on the basis that I was not then hearing the notice of motion, but rather simply seeking to understand the basis for the relief proposed by Mr Kammoun.
I then made orders granting leave to Mr Yu to file and serve a notice of motion in the form of the draft that had been provided, or in a form amended to include any basis for relief other than pursuant to the slip rule, and directed that such notice of motion be returnable before me at 9:00am on 29 February 2024. I directed that Mr Kammoun arrange for service on Dr Wang of the notice of motion, as well as any affidavits in support of the notice of motion, any submissions, any relevant case extracts and a copy of the orders by 4:00pm that day. I then stood the matter over to today for hearing of the notice of motion.
Later that afternoon, Dr Wang sent an email to my Associate and to the other legal representatives. The email did not address why she had failed to appear that morning. Rather, the email stated:
Dear All
I have a medical appointment on 29 Feb 2024 which was booked one month ago and I could not afford to reschedule. I need to apply for an online hearing.
Kind regards,
Lu
On 23 February 2024, Ms Naim provided to my Associate, by email, a sealed copy of the notice of motion and the associated documents relied upon. Later on 23 February 2024, at my request my Associate sent an email to the practitioners and Dr Wang indicating that I had considered the email of Dr Wang and stating that the listing of the notice of motion would remain at 9:00am on 29 February 2024, however, I would provide an AVL link to enable Dr Wang to attend remotely.
On 26 February 2024, my Associate provided the practitioners and Dr Wang with an AVL link and other information to enable them to join via telephone, if need be. Dr Wang sent an email to my Associate on that day thanking her for her email, thereby acknowledging receipt.
This morning on the listing of the motion, Mr Lonergan of counsel appeared for Mr Yu. Mr Kammoun, Mr Yu's instructing solicitor, appeared by AVL.
Dr Wang was not physically in the courtroom and, accordingly, I had the matter called outside court. Dr Wang did not appear in response to the call outside the court. I indicated to the parties that I would arrange for my Associate to monitor the AVL, and to alert me if at any stage Dr Wang attempted to appear or connect by AVL. As I am delivering these reasons for judgment, the position is that my Associate has indicated that Dr Wang has not attempted to connect by AVL.
On the hearing of the application, I have been assisted by Mr Kammoun's outline of submissions and have also been assisted by Mr Lonergan in relation to a number of aspects of the matter.
[3]
Extent of the slip rule
The slip rule is in the following terms:
36.17 Correction of judgment or order ("slip rule")
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 of its own motion, may, at any time, correct the mistake or error.
Many instances of the slip rule arise from circumstances in which the judicial officer has made a clerical mistake.
The wording of the rule, whilst predicated on a clerical mistake or error arising from an accidental slip or omission being made, does not, at least directly, set out any requirement in relation to who has made the error.
In this case, the error has been made on the part of the legal practitioners for Mr Yu.
I am satisfied that the application of the slip rule is not confined to situations giving effect to the intention of the judge at the time that the Court's order was made or judgment was given, but relevantly extends to permit the correction of an order where the omission results from the inadvertence of a party's legal representatives and, specifically, extends to a situation in which there is an application to vary orders by the inclusion of interest in the judgment: see, for example, L Shaddock & Associates Pty Ltd v Parramatta City Council (No 2) (1982) 151 CLR 590 at 594-595 per Mason ACJ, Wilson and Deane JJ; [1982] HCA 59, citing Fritz v Hobson (1880) 14 Ch D 542 at 561-562; see also Roads and Traffic Authority of NSW v Palmer (No 2) [2005] NSWCA 140 at [25] per Giles JA (Spigelman CJ and Handley JA agreeing); Elyard Corporation Pty Ltd v DDB Needham Sydney Pty Ltd (1995) 61 FCR 385 at 391 per Lockhart J (Black CJ agreeing).
[4]
The application for interest
The terms of s 100 of the Civil Procedure Act 2005 (NSW) relevantly are as follows:
100 Interest up to judgment
(1) In proceedings for the recovery of money (including any debt or damages or the value of any goods), the court may include interest in the amount for which judgment is given, the interest to be calculated at such rate as the court thinks fit -
(a) on the whole or any part of the money, and
(b) for the whole or any part of the period from the time the cause of action arose until the time the judgment takes effect.
(2) In proceedings for the recovery of a debt or damages in which payment of the whole or a part of the debt or damages has been made after the proceedings commenced but before, or without, judgment being given, the court may include interest in the amount for which judgment is given, the interest to be calculated at such rate as the court thinks fit -
(a) on the whole or any part of the money paid, and
(b) for the whole or any part of the period from the time the cause of action arose until the time the money was paid.
(3) This section -
(a) does not authorise the giving of interest on any interest awarded under this section, and
(b) does not authorise the giving of interest on a debt in respect of any period for which interest is payable as of right, whether by virtue of an agreement or otherwise, and
(c) does not authorise the giving of interest in any proceedings for the recovery of money in which the amount claimed is less than such amount as may be prescribed by the uniform rules, and
(d) does not affect the damages recoverable for the dishonour of a bill of exchange.
…
Statutory provisions allowing for the award of interest are to be construed according to their terms. However, as a general proposition, it is clear that the use of the permissive verb "may" in legislation giving power to Courts to award interest, phrased in discretionary terms, has been consistently construed by Courts in a manner suggesting that the circumstances in which an award of interest may be refused are rare and "almost invariably" interest is to be allowed when claimed: Falkner v Bourke (1990) 19 NSWLR 574 at 576A-C per Priestley JA. The decision of the High Court in Ruby v Marsh (1975) 132 CLR 642 at 644; [1975] HCA 32, construing in that case the then relevant Victorian provisions addressing interest, gives general support for that approach.
As the award of interest is essentially compensatory, the defendant's conduct in contesting the proceedings (whether or not reasonable and diligent) does not ordinarily provide a proper basis for either making or refusing an award of interest: e.g. Batchelor v Burke (1981) 148 CLR 448 at 455 per Gibbs CJ; [1981] HCA 30.
[5]
Clerical error explained - oversight by legal representatives
The omission to seek interest at the hearing on 20 December 2023 has been explained by Mr Kammoun as being an oversight, an inadvertence on the part of himself and counsel. Mr Kammoun's affidavit, affirmed on 14 February 2024, explains the context for that oversight. I am satisfied that the oversight and inadvertence constitutes a "clerical mistake, or an error arising from an accidental slip or omission" leading to the failure of Mr Yu's legal representatives to seek orders for pre-judgment interest at the time of proposing the short minutes of order, and when I dealt with the matter on 20 December 2023.
Mr Yu's legal representatives submit, and I accept, that at all material times it was the intention of Mr Yu to seek interest on the sum of $200,000 against Dr Wang in the event that he was successful in obtaining a judgment for a monetary amount. This is evident from the claim for relief in the cross‑claim.
But for the inadvertence, I am satisfied that an application would have been made for pre-judgment interest on the sum of $200,000 at the time of making the orders on 20 December 2023.
[6]
Discretion - no factors mitigating against claim for interest
No reason, let alone any compelling reason, has been given as to why interest should not be now included.
The inadvertence was discovered within a relatively short time after the judgment. I note that the judgment was given on 20 December 2023, which was after the formal court term had ended last year, and was entered in that respect during the period of vacation. I accept Mr Kammoun's evidence that he immediately brought the omission to the Court's attention, and to Dr Wang's attention, upon discovery of the omission.
I accept that Mr Yu has not engaged in any conduct which would disentitle him from claiming or seeking pre-judgment interest.
[7]
Principle informing the choice of date from which interest is calculated
What is the appropriate date or dates from which pre-judgment interest is to be calculated?
Mr Yu's representatives submitted that the pre-judgment interest on the judgment sum of $200,000, up to 20 December 2023, should be calculated from the dates that the monies were given by Mr Yu to Dr Wang. Mr Kammoun, in his written outline of submissions, referenced findings that I had made that the $200,000 sum was paid subsequent upon Dr Wang and Mr Yang pressing Mr Yu for payment and that the payments were made in a context in which Mr Yu was still scared of Mr Yang and fearful of the threats he had made: principal judgment at [576], [577].
An alternative submission was put that the Court should order the payment of interest from the date that Mr Yu avoided the deed, which calculation of interest would, according to Mr Kammoun, be in the amount of $29,584.66 (though stated as $29,583.66 in the notice of motion).
In further elaboration of his submissions, Mr Kammoun cited the case of Maskell v Horner [1915] 3 KB 106 for the proposition that, in a case of economic duress, the cause of action arises at the time that the money is advanced, as opposed to a later point of time. In the principal judgment I did actually make reference to that decision (albeit for a different proposition). Mr Kammoun also referred to commentary in Halsbury's Laws of Australia, 110 - Contract [110-5690] Payments made under compulsion.
The above case (which deals with a matter in which the plaintiff, upon the demand of a defendant who was the owner of a market, paid tolls under threat of seizure of goods) and text citations do not precisely in terms support a proposition that it is appropriate to award interest in a case of economic duress from the time that the monies are paid. Nonetheless, I regard the proposition for which Mr Kammoun contended in his submissions, and for which Mr Lonergan supported, as being an appropriate principle on which to act for the purposes of this case, namely, that interest is payable on the amount recoverable at the times that the amounts were advanced by Mr Yu under the operative duress.
As a general proposition, it is said that "[p]ayments as the result of improper pressure are recoverable with interest from date of payment:" K Mason, JW Carter and GJ Tolhurst, Mason & Carter's Restitution Law in Australia (4th ed, 2021, LexisNexis) at [2816], citing Nixon v Furphy (1926) 26 SR (NSW) 409, Collector of Customs v Gaylor Pty Ltd (1995) 35 NSWLR 649; 127 ALR 641 which in turn affirmed Dahlia Mining Co Ltd v Collector of Customs (1989) 17 NSWLR 688 (Dahlia Mining).
While that proposition was, strictly speaking, in relation to an award of non-statutory interest, the award of interest in Dahlia Mining was made pursuant to s 94 of the Supreme Court Act 1970 (NSW) (being the predecessor to s 100 of the Civil Procedure Act 2005 (NSW)). In that case, Giles J held that, as the common law cause of action for money had and received arose when the payment (being a duty that was paid under protest) was made, the plaintiffs' entitlement to recover it existed from that time and, accordingly, they were entitled to recover interest under s 94 from that date: Dahlia Mining at 696.
[8]
Application of the principle
I made findings as to the points of time at which Mr Yu paid the sums of $100,000, $20,000, $50,000 and $20,000, comprising a total of $190,000: principal judgment at [570]. I did not make any precise finding as to how and when Mr Yu paid the additional sum of $10,000, which was paid to Dr Wang: principal judgment at [572]. However, I did find that a total amount of $200,000 had been paid by 28 June 2016 as referenced in the deed of that date: principal judgment at [576].
Mr Kammoun in his affidavit had calculated interest on the additional $10,000 amount, making up the $200,000, from 11 May 2016. There is some material in the evidence on the proceedings which indicates that Mr Yu had asserted that he had paid the sum of $200,000 to or for the benefit of Dr Wang (albeit describing it as a personal loan) from 11 May 2016. Even though the possibility exists that the amount of $10,000 was paid prior to the date of the deed I am satisfied that, in conformity with the findings that I have made in the principal judgment, the appropriate date for the calculation of interest on the $10,000 amount is the date of the deed, being 28 June 2016.
Mr Kammoun, during the hearing of the notice of motion, helpfully performed a recalculation of the pre-judgment interest on the respective sums totalling $200,000 up to 20 December 2023, arriving at the amount of interest in the sum of $84,470.12.
[9]
Costs
In relation to the question of costs, having regard to the nature of the application, I do not consider that it is appropriate for Dr Wang to be required to pay any costs in respect of the application. I consider that the appropriate order is that there be no order as to the costs of Mr Yu, to the intent that he will bear his own costs incidental to the notice of motion which was filed on 23 February 2024 and a draft of which was circulated on or about 14 February 2024.
Dr Wang has not appeared on the application and there is no indication given to the Court that Dr Wang has any current legal representatives. There is no reason to think that she has incurred any legal costs in respect of the application.
[10]
Conclusion
The outcome of the matter is that I make orders as follows:
1. Order nunc pro tunc that Order 2 made on 20 December 2023 be varied so that the order is as follows:
Orders judgment in favour of the Cross-Claimant against the First Cross‑Defendant on the Cross-Claim in the sum of $284,470.12.
1. Order that there be no order as to the costs of Mr Yu, to the intent that he will bear his own costs incidental to the notice of motion which was filed on 23 February 2024 and a draft of which was circulated on or about 14 February 2024.
2. Order that there be no order as to the costs of Dr Wang in respect of the notice of motion filed on 23 February 2024, to the intent that she bear her own costs incidental to the notice of motion.
[11]
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Decision last updated: 01 March 2024