mdroth/huggingface-course_section-5_zst huggingface dataset:
Case: Stern v McArthur [1988] HCA 51 ; (1988) 165 CLR 489 
Outcome: referred to
Thus, whilst there is a promise in an executory contract to pay the balance of the purchase price on settlement, there is no "debt" ( McDonald v Dennys Lascelles ) and no "accrued liability on the part of the purchaser to make the payment" (see Mason CJ in Sunbird Plaza 166 CLR at 254), until completion. This is not to deny, however, that the purchaser's interests will be protected in equity consistent with the nature and extent of the terms of the contract of sale: Stern v McArthur [1988] HCA 51 ; (1988) 165 CLR 489 at 522-23, and that the promise can be otherwise seen as unqualified. 76 The Full Court rejected the argument. In so doing, it referred to and relied on the two passages from Raymor 24 FCR at 97 and 101, cited earlier. This was to support the conclusion that the entry into the obligation to pay for future goods was sufficient for there to be an incurring of the liability to pay for them, even if the obligation was defeasible. Coles Myer [1993] HCA 29 ; 176 CLR 640 was then referred to. At 47 FCR at 573-575 the Full Court expressed its reasons fully for coming to the view that there was an accrued obligation or present liability imposed by definite contractual commitment. The Court said that it was not necessary for the taxpayer to have an interest in the wool, though it was recognised that equity would give protection to the taxpayer's interests. Stern v McArthur [1988] HCA 51 ; 165 CLR 489 was referred to. The Court rejected the argument of the Commissioner based on the requirement of delivery to create a present and accrued liability to pay. It agreed with Lee J's analysis. The Full Court did conclude, however, with the following passage at 47 FCR at 575: In our view, much will depend upon the particular circumstances of the case at hand. If the defeasibility takes the form of a contingency such as drought or a similar frustrating event which ordinarily would be implied as a matter of business efficacy, it is difficult to argue that by reason of the existence of this contingency, no liability to pay the price has accrued. 81 A deduction is referable to the year in which the advantage it secures is enjoyed: Coles Myer 176 CLR at 665; and New Zealand Flax at 207-208. The advantage secured and enjoyed was the binding of the vendor to an unconditional contract (in the sense first discussed) creating contractual rights capable of protection by a court of equity conformable with their extent: Stern v McArthur. This occurred in the 1999 year of income.
Case: Walstern Pty Limited v Commissioner of Taxation [2003] FCA 1428 ; (2003) 138 FCR 1
Outcome: referred to
On the above conclusions, no question of penalty arises. I should, however, express my views. Mr Malouf was cross-examined with some vigour. I do not criticise counsel. The object was, amongst others, to show that Mr Malouf entered the scheme without giving proper consideration to the issues that might bear upon the taxation treatment and his returns. I disagree. The Commissioner was responsible for the ruling which clearly made the outgoing on revenue account. Well-known junior counsel skilled in the revenue field gave a considered and careful advice. It did not touch the corporations aspects of the scheme which led to the winding up of the scheme; but those issues are not determinative of the liability. Taking into account s 226G of the 1936 Act (for the 2000 year of income) and s 284-90(1) item 3 of Part 4-25 of the Taxation Administration Act (for the 2001 year of income) and the cognate principles in Walstern Pty Limited v Commissioner of Taxation [2003] FCA 1428 ; (2003) 138 FCR 1 , in my view a penalty was not legally warranted. Mr Malouf exhibited sufficient care and displayed no impropriety. 83 For the above reasons the decision of the Commissioner disallowing the objection will be set aside. No order for costs is necessary as the proceeding had test case funding. I will provide the parties with an opportunity to agree precise consequential orders dealing with the taxpayer's assessment, if that be thought necessary or appropriate. I certify that the preceding eighty-three (83) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Allsop. Associate: Dated: 22 April 2008 Counsel for the Applicant: Mr D E Russell QC, with Mr D K L Raphael and Ms A Ketas Solicitor for the Applicant: Gibsons Lawyers Counsel for the Respondent: Mr J W deWijn QC with Mr F O'Loughlin Solicitor for the Respondent: Australian Government Solicitor Date of Hearing: 24 and 25 September 2007 Date of Judgment: 22 April 2008 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2008/497.html
Case: Woolcombers (WA) Pty Limited v Commissioner of Taxation [1993] ATC 4 ,342
Outcome: discussed
In particular, reliance was placed on the judgments of Lee J at first instance and of the Full Court in the Woolcombers case : Woolcombers (WA) Pty Limited v Commissioner of Taxation [1993] HCA 69 ; 93 ATC 4 ,342 (Lee J) and Commissioner of Taxation v Woolcombers (WA) Pty Limited [1993] FCA 631 ; (1993) 47 FCR 561 (Full Court) and on the Full Court judgment in Commissioner of Taxation v Raymor (NSW) Pty Limited [1990] FCA 193 ; (1990) 24 FCR 90.
Case: APF Properties Pty Ltd v Kestrel Holdings Pty Ltd (No 2) [2007] FCA 1561
Outcome: cited
The substantive judgment in this proceeding was handed down on 15 November 2007: APF Properties Pty Ltd v Kestrel Holdings Pty Ltd (No 2) [2007] FCA 1561. Further argument has now been heard as to the amount for which judgment should be entered and the question of costs. 2 I have found that the applicant is entitled to judgment against the first and second respondents (the Robinsons) and the fourth respondent (Mantach) for damages being the difference between the price paid for Broadmoor and Lower Wilmot and the true value of those properties at the time of purchase, together with certain expenses and interest. The Robinsons were the vendors of the properties and Mantach was a valuer which provided a valuation on which the applicant purchaser relied. 3 It was accepted, at least implicitly, at the substantive hearing that if the applicant paid too much for the property it followed that it borrowed too much and the damages should include interest paid on the excess borrowing.
Case: King v Yurisich (No 2) [2007] FCAFC 51
Outcome: cited
In arguing against giving the offer any costs consequence Mr Cawthorn SC for Mantach, supported by Mr Ayliffe for the Robinsons, contended that the form of offer required all of the respondents to accept it. Contrary to O 23 r 2(2) it did not specify separately the offer made to each party. It was not possible for Mantach alone (or as Mr Ayliffe says, the Robinsons alone) to accept the offer in accordance with its terms. Reference was made to the decision of the Full Court of this Court in King v Yurisich (No 2) [2007] FCAFC 51 at [11] where their Honours said: There does not appear to be any basis under the terms of O 23 for the proposition that an offer made to all respondents can be accepted only by one. The fund made an offer which required all four respondents to whom it was made to accept its terms. If one respondent failed to accept, the fact that the other three had sought to would not have been a compliance with the terms of the offer. Moreover, in those circumstances there would be nothing which the respondents who wanted to accept the offer could do to comply with its terms. If the fund were correct in its construction of O 23, this would mean that any respondent who had wanted to accept the offer but was unable to persuade the others to do so, would be responsible for the payment of costs on an indemnity basis notwithstanding that respondent's attempt to satisfy the offer so far as it could. Given that the obliging respondent had no power to compel the others to act reasonably or to accept the offer, the consequence would be unacceptably harsh. Reference was also made to the decision of Byrne J in the Supreme Court of Victoria in Aquatec-Maxcon Pty Ltd v Barwon Water Authority (No 3) [2006] VSC 270 at [20] - [21] . 18 However, it is not necessary to decide whether King prevents such a conclusion. Even if the offer did not comply with Order 23, it was nevertheless not a nullity. The making and non-acceptance of it are facts which happened and which are relevant to the exercise of the discretion as to costs. The only difference is that if Order 23 does not apply there is no presumptive entitlement to indemnity costs: MGICA (1992) Pty Ltd v Kenny &amp; Good Pty Ltd (No 2) (1996) 70 FCR 236 at 240. 21 Recently a Full Court of the Federal Court in WSA Online Limited v Arms (No 2) [2006] FCAFC 108 said at [16], citing MGCIA : A Calderbank offer does not carry the same presumptive entitlement to indemnity costs, but the public policy of encouraging settlement of litigation should nevertheless lead the Court to make an order for indemnity costs where a Calderbank offer has been made in terms which are clear and where it is appropriate to do so. It is worth noting that one of the aspects of the offer being considered in WSA Online was that it was made to a number of parties and one of them could not accept it independently without the agreement of others. Nevertheless the Full Court said at [18] this "was not a matter which conclusively operates against the costs order sought". In King at [8] the later Full Court cited WSA Online with no suggestion of disapproval.
Case: Aquatec-Maxcon Pty Ltd v Barwon Water Authority (No 3) [2006] VSC 270
Outcome: cited
In arguing against giving the offer any costs consequence Mr Cawthorn SC for Mantach, supported by Mr Ayliffe for the Robinsons, contended that the form of offer required all of the respondents to accept it. Contrary to O 23 r 2(2) it did not specify separately the offer made to each party. It was not possible for Mantach alone (or as Mr Ayliffe says, the Robinsons alone) to accept the offer in accordance with its terms. Reference was made to the decision of the Full Court of this Court in King v Yurisich (No 2) [2007] FCAFC 51 at [11] where their Honours said: There does not appear to be any basis under the terms of O 23 for the proposition that an offer made to all respondents can be accepted only by one. The fund made an offer which required all four respondents to whom it was made to accept its terms. If one respondent failed to accept, the fact that the other three had sought to would not have been a compliance with the terms of the offer. Moreover, in those circumstances there would be nothing which the respondents who wanted to accept the offer could do to comply with its terms. If the fund were correct in its construction of O 23, this would mean that any respondent who had wanted to accept the offer but was unable to persuade the others to do so, would be responsible for the payment of costs on an indemnity basis notwithstanding that respondent's attempt to satisfy the offer so far as it could. Given that the obliging respondent had no power to compel the others to act reasonably or to accept the offer, the consequence would be unacceptably harsh. Reference was also made to the decision of Byrne J in the Supreme Court of Victoria in Aquatec-Maxcon Pty Ltd v Barwon Water Authority (No 3) [2006] VSC 270 at [20] - [21] .
Case: MGICA Pty Ltd v Kenny &amp; Good Pty Ltd (No 2) (1996) 70 FCR 236
Outcome: cited
However, it is not necessary to decide whether King prevents such a conclusion. Even if the offer did not comply with Order 23, it was nevertheless not a nullity. The making and non-acceptance of it are facts which happened and which are relevant to the exercise of the discretion as to costs. The only difference is that if Order 23 does not apply there is no presumptive entitlement to indemnity costs: MGICA (1992) Pty Ltd v Kenny &amp; Good Pty Ltd (No 2) (1996) 70 FCR 236 at 240. 19 In MGICA there was no Order 23 offer but there had been a Calderbank letter which Lindgren J at 238 accepted as relevant. His Honour pointed out that s 43, and perhaps also 23, of the Federal Court of Australia Act 1976 (Cth) empower the Court to award costs on an indemnity basis. The discretion must of course be exercised judicially. His Honour at 239 reviewed a number of single instance Federal Court decisions and in particular John S Hayes &amp; Associates Pty Ltd v Kimberly-Clark Australia Pty Ltd (1994) 52 FCR 201 at 204-206 and Sanko Steamship Co Ltd v Sumitomo Australia Ltd (unreported, 7 February 1996). In these cases indemnity costs were refused because, although the offeree achieved a worse result at judgment, it could not be said that there was "no chance of success" ( John S Hayes at 206) or that in not accepting the offer the offeree's conduct was "plainly unreasonable" ( Sanko at 9). 23 In the final analysis the award of indemnity costs remains a matter of discretion. In MGICA Lindgren J said at 238 that the obligation to exercise the discretion judicially ... does not mean, and it is wrong to think, that the law requires that the discretion be exercised in a certain way in a particular case because of the presence or absence of factors which may have been persuasive in an earlier case. How the discretion is to be exercised in a particular case depends on all relevant circumstances of that case . (Emphasis in original)
Case: John S Hayes &amp; Associates Pty Ltd v Kimberly-Clark Australia Pty Ltd (1994) 52 FCR 201
Outcome: cited
In MGICA there was no Order 23 offer but there had been a Calderbank letter which Lindgren J at 238 accepted as relevant. His Honour pointed out that s 43, and perhaps also 23, of the Federal Court of Australia Act 1976 (Cth) empower the Court to award costs on an indemnity basis. The discretion must of course be exercised judicially. His Honour at 239 reviewed a number of single instance Federal Court decisions and in particular John S Hayes &amp; Associates Pty Ltd v Kimberly-Clark Australia Pty Ltd (1994) 52 FCR 201 at 204-206 and Sanko Steamship Co Ltd v Sumitomo Australia Ltd (unreported, 7 February 1996). In these cases indemnity costs were refused because, although the offeree achieved a worse result at judgment, it could not be said that there was "no chance of success" ( John S Hayes at 206) or that in not accepting the offer the offeree's conduct was "plainly unreasonable" ( Sanko at 9). 20 Lindgren J noted at 240 that a different approach was taken by Rolfe J in the Supreme Court of New South Wales in Multicon Engineering Pty Ltd v Federal Airports Corporation (1996) 138 ALR 425. Rolfe J expressed disagreement with John S Hayes and Sanko . His Honour took the view that non-acceptance of an offer which was better than the ultimate result itself prima facie demonstrated unreasonable conduct warranting indemnity costs. Lindgren J at 240 followed the two Federal Court decisions, although he thought that there were many cases, including the one before him, where the different approaches would not produce a different result.
Case: Sanko Steamship Co Ltd v Sumitomo Australia Ltd (unreported, 7 February 1996)
Outcome: cited
In MGICA there was no Order 23 offer but there had been a Calderbank letter which Lindgren J at 238 accepted as relevant. His Honour pointed out that s 43, and perhaps also 23, of the Federal Court of Australia Act 1976 (Cth) empower the Court to award costs on an indemnity basis. The discretion must of course be exercised judicially. His Honour at 239 reviewed a number of single instance Federal Court decisions and in particular John S Hayes &amp; Associates Pty Ltd v Kimberly-Clark Australia Pty Ltd (1994) 52 FCR 201 at 204-206 and Sanko Steamship Co Ltd v Sumitomo Australia Ltd (unreported, 7 February 1996). In these cases indemnity costs were refused because, although the offeree achieved a worse result at judgment, it could not be said that there was "no chance of success" ( John S Hayes at 206) or that in not accepting the offer the offeree's conduct was "plainly unreasonable" ( Sanko at 9). 20 Lindgren J noted at 240 that a different approach was taken by Rolfe J in the Supreme Court of New South Wales in Multicon Engineering Pty Ltd v Federal Airports Corporation (1996) 138 ALR 425. Rolfe J expressed disagreement with John S Hayes and Sanko . His Honour took the view that non-acceptance of an offer which was better than the ultimate result itself prima facie demonstrated unreasonable conduct warranting indemnity costs. Lindgren J at 240 followed the two Federal Court decisions, although he thought that there were many cases, including the one before him, where the different approaches would not produce a different result.
Case: Multicon Engineering Pty Ltd v Federal Airports Corporation (1996) 138 ALR 425
Outcome: cited
Lindgren J noted at 240 that a different approach was taken by Rolfe J in the Supreme Court of New South Wales in Multicon Engineering Pty Ltd v Federal Airports Corporation (1996) 138 ALR 425. Rolfe J expressed disagreement with John S Hayes and Sanko . His Honour took the view that non-acceptance of an offer which was better than the ultimate result itself prima facie demonstrated unreasonable conduct warranting indemnity costs. Lindgren J at 240 followed the two Federal Court decisions, although he thought that there were many cases, including the one before him, where the different approaches would not produce a different result.
Case: WSA Online Limited v Arms (No 2) [2006] FCAFC 108
Outcome: cited
Recently a Full Court of the Federal Court in WSA Online Limited v Arms (No 2) [2006] FCAFC 108 said at [16], citing MGCIA : A Calderbank offer does not carry the same presumptive entitlement to indemnity costs, but the public policy of encouraging settlement of litigation should nevertheless lead the Court to make an order for indemnity costs where a Calderbank offer has been made in terms which are clear and where it is appropriate to do so. It is worth noting that one of the aspects of the offer being considered in WSA Online was that it was made to a number of parties and one of them could not accept it independently without the agreement of others. Nevertheless the Full Court said at [18] this "was not a matter which conclusively operates against the costs order sought". In King at [8] the later Full Court cited WSA Online with no suggestion of disapproval. 22 In this regard I note that prior to trial the applicant reached a compromise with the fifth respondent Harrison Humphreys Pty Ltd, a valuer against whom the applicant pleaded substantially the same case as it did against Mantach. The terms of that settlement are not known to the Court, and would not be relevant if they were. The point is, however, that it was possible for the applicant in the circumstances of the present case to settle with one of several respondents. Outside the specific requirements of Order 23 the Court is in the area of general discretion as to indemnity costs. The fact that, as a matter of contract law, an offer might not have been capable of acceptance by one respondent is not conclusive against an award of indemnity costs: WSA Online .
Case: Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225
Outcome: cited
The locus classicus on the subject is still the decision of Sheppard J in Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225. His Honour at 230 noted that the power to order such costs is not "to be circumscribed in any way" and, at 231, that the power "is not so circumscribed that an order of this character may be made only against an ethically or morally delinquent party". His Honour at 233 noted as one of the circumstances which have been thought to warrant the exercise of the discretion "an imprudent refusal of an offer to compromise". 25 In my opinion in the present case the refusal of the applicant's offer was imprudent. It was made when the parties' evidence, or at least the great bulk of it, was available in affidavit form. It would have been apparent to an objective observer that there was, at the lowest, a serious risk of a Court finding that there had been a gross misrepresentation as to the croppable areas of Broadmoor and Lower Wilmot and that this had led, along with other factors, to a gross over valuation, as demonstrated, apart from anything else, by the result of the subsequent sales. The objective observer would also have been aware that it would take a long and expensive trial for the applicant to run its case to judgment. 26 I will order that the Robinsons and Mantach pay the applicant's costs on a party and party basis up until 21 March 2007 (being 14 days from the date of the offer) and thereafter on an indemnity basis. 27 There is no opposition to an extension to 15 February 2008 of the time for filing and serving a notice of appeal. I certify that the preceding twenty-seven (27) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Heerey. Associate: Dated: 19 December 2007 Counsel for the Applicant: M E O'Farrell Solicitors for the Applicant: Ware &amp; Partners Counsel for the First and Second Respondents: W A Ayliffe Solicitors for the First and Second Respondents: Simmons Wolfhagen Counsel for the Fourth Respondent: P G Cawthorn SC and C Madder Solicitors for the Fourth Respondent: DLA Phillips Fox Date of Hearing: 13 December 2007 Date of Judgment: 19 December 2007 AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback URL: http://www.austlii.edu.au/au/cases/cth/FCA/2007/2016.html
Case: Hermitage Motel Pty Ltd v P. E. Kafka Pty Ltd [2008] FCA 442
Outcome: related
On 4 April 2008 I delivered reasons for judgment ( Hermitage Motel Pty Ltd v P. E. Kafka Pty Ltd [2008] FCA 442) and stood the matter over in order to enable the first applicant to bring in minutes of order to give effect to those reasons. Some issues need to be determined. 2 In principle, the respondents are entitled to costs occasioned by the claim of the second applicant which was not proceeded with. It seems to me that that is likely to be a very slim amount, but that is a matter for agreement, taxation or assessment. 3 The intertwined issues of costs of the adjournment, which took place on 27 November 2006, and the impact upon the running of interest are rather more difficult questions. The case as pleaded and represented by the evidence was a conventional purchase of a business induced by misleading representations, with the evidence on both sides valuing the property purchased at the time of completion. As with other cases in this Court, it is a case-managed proceeding. On the Friday before the hearing, counsel for the respondents raised the spectre of an argument that the proper measure of damage was the difference between the amount paid and the value of the motel at the time of trial, certainly not being the value of the motel at the time of completion. If correct, that would have meant that the applicants had no evidence as to the value at the time contended for. In those circumstances, the applicants sought an adjournment of the proceeding in order that they could meet that potential argument.