Dillon v De King [1993] QSC 74

TRANSCRIPT fJF PROCEEDINGS (Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Director~ State Reporting Bureau.) SUPREME COURT OF QUEENSLN~D CIVIL JURISDICTION j RYAN J No 630 of 1991 BARBARA NOEL DILLON and RODNEY JOHN DE KING BRISBANE .. DATE 25/03/93 JUDGMENT Plaintiff Defendant 1 4th Floor, The Law Courts, George Street, Brisbane, Q. 4000 Telephone: (07) 227 4360. Facsimile: (07) 227 5532 -- 1 of 10 -- 250393 tgc (Ryan J) HIS HONOUR: Before giving my judgment in this matter, I "1 should mention that when I reviewed the papers I came to the conclusion that the offers whYch purported to be under Order 26 were, in fact, not offers to settle within the sense of Order 26 because they did not specify a period during which the offer was valid for acceptance. I have treated them therefore as informal offers only in the same way as the letter of 22 December 1992. That point was not argued before me. Do either of you gentlemen wish to argue it now? HIS HONOUR: The order I make is that the defendant pay the plaintiff's costs of and incidental to the action including reserved costs to be taxed. I publish my reasons. JUDGMENT 2 10 20 30 40 50 60 -- 2 of 10 -- ---------------- TRANSCRIPT OF PRO(~EEDINGS (Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Director, State Reporting Bureau.) REVISC:D COPiC.:3 ;SSUED Stat:~ SUPREME COUR'I' OF QUEENSLAND CIVIL JURISDICTION RYAN J No 630 of 1991 BARBARA NOEL DILLON Plaintiff and RODNEY JOHN DE KING Defendant BRISBANE .. DATE 16/03/93 ORDER 1 " I*WM 4th Floor, The Law Courts, George Street, Brisbane, Q. 4000 Telephone: (07) 227 4360. Facsimile: (07) 227 55.32 -- 3 of 10 -- 160393 jjh (Ryan J) HIS HONOUR: I make the following orders: 1 That the partnership constituted between the plaintiff and the defendant and trading under the names and styles of Mela Systems of Australia, Melabalm, Melacorp of Australia and Australis Pharmaceuticals Inc USA be dissolved. 2 That the affairs of the partnership be wound up. 3 For the purposes aforesaid that all necessary accounts and inquiries be taken and made. 4 That the defendant deliver to the plaintiff a certain diamond and gold ring and a certain gold and sard onyx ring or if either of them has been lost all his right, title an interest in the insurance claim in respect thereto. 5 That the defendant withdraws his counterclaim. 6 I reserve the question of costs. ORDER 2 10 20 30 40 50 60 -- 4 of 10 -- IN THE SUPREME COURT OF QUEENSLAND Before Mr. Justice K.W. Ryan [Re: Dillon & Others] BETWEEN: BARBARA NOEL DILLON RODNEY JOHN DE KING REASONS FOR JUDGMENT - RYAN J. Judgment delivered 25/03/1993 No. 630 of 1991 Plaintiff Defendant Appearances: Mr. A. Daubney for the Plaintiff Solicitors: Hearing Date: Mr. W. Rosen (Solicitor) for the Defendant Michell Sillar Nicholsons for the Plaintiff Rosen Lawyers for the Defendant 16 March 1993 -- 5 of 10 -- IN THE SUPREME COURT OF QUEENSLAND Before Mr. Justice K.W. Ryan [Re: Dillon & Others] BETWEEN: BARBARA NOEL DILLON AND: RODNEY JOHN DE KING REASONS FOR JUDGMENT- RYAN J. Judgment delivered 25/03/1993 No. 630 of 1991 Plaintiff Defendant On 16 March 1993 I made an order in this action dissolving the partnership between the plaintiff and defendant and also certain consequential orders. These orders were made without opposition by the defendant. The only question that remains for consideration is the issue of costs. The action was commenced on 10 April 1991. The plaintiff claimed an order that the partnership constituted between the plaintiff and defendant be dissolved and consequential orders. Alternatively, she claimed a declaration that the defendant held on trust for her the assets and undertakings of businesses conducted by the defendant, and a declaration that the defendant -- 6 of 10 -- 2 held on trust for the plaintiff certain specified property. An appearance was entered by the defendant on 15 April 1991. On 10 April 1991 a notice of motion had been filed for an order that pending the trial of the action the defendant be restrained from dealing with any of the property or assets of the business conducted by the defendant under the names or styles Melacorp of Australia, Melasystems of Australia or Australia Pharamaceuticals Inc. On 17 April 1991 the defendant filed an affidavit in relation to the notice of motion, in which he claimed that the plaintiff had pestered him to allow her to invest in his business, and that he specifically set up the investment by her as an investment and not as any form of partnership and/or joint venture or equity participation. On 18 April 1991 an order was made by de Jersey J. restraining the defendant pending trial from dealing with the property. In the affidavit made by the plaintiff in support of the motion, she did not assert that a partnership had been entered into by her and the defendant. A statement of claim was served upon the defendant on 7 June 1991, and a defence and counter-claim was filed on behalf of the defendant on 3 July 1991. In the statement of claim, it was alleged in paragraph 2 inter alia that in about November 1989 it was orally agreed between the plaintiff and defendant (a) that as from that time, ·the plaintiff would become fully involved with the defendant in the conduct and running of the business; (b) that the plaintiff would invest money in the business, and the defendant would match the plaintiff's investment by contributing -- 7 of 10 -- 3 to the business stock to a value equal to the plaintiff's cash investment; (c) that the parties would share equally in the profits from the business. In paragraph 3 it is alleged that in the premises, as from about November 1989 there existed a partnership between the plaintiff and the defendant with respect to the business. By the defence, the facts alleged in paragraphs 2 and 3 of the statement of claim are denied. On 22 December 1992, an offer to settle was received by the solicitors for the plaintiff from the solicitors for the defendant on terms that the plaintiff accept the transfer of the defendant's right, title and interest in the business to the plaintiff in full satisfaction and discharge of any claim she may have against the defendant arising out of the matters, the subject of the litigation, and that the parties bear their own legal costs of and incidental to the action. This offer was rejected on 18 January 1993. The letter of rejection stated that the plaintiff was willing to settle only on the basis that the defendant paid to the plaintiff the damages claimed on the face of the statement of claim plus her part and party costs. No damages had in fact been claimed on the face of the statement of claim. On 4 March 1993, an offer to settle in accordance with 0.26 was made by the defendant, and on 9 March 1993 by the plaintiff. These differed essentially in two respects. One was that the defendant proposed as an alternative to the winding up of the partnership that the defendant transfer to the plaintiff all his right, title and title in the assets of the business conducted by him. The other was that whereas the offer of the defendant -- 8 of 10 -- 4 was that each of the parties pay their own costs of and incidental to the proceedings, the offer of the plaintiff was that the defendant pay the plaintiff's costs, including reserved costs, of the action to be taxed. There was also some measure of disagreement in relation to delivery of certain rings, but this was a matter as to which the parties were substantially in agreement. I note that the letter of 22 December 1992 is not expressed to be an offer made in accordance with 0. 26, and that the offers of 4 March 1993 and 9 March 1993, though purporting to be made in accordance with 0. 26 do not specify a period during which the offer is open for acceptance. I am unable to regard these offers as "offers to settle" in the sense of 0. 26. This does not however have the effect that they may not be taken into account on the issue of costs. No question arises in this case as to the use of "without prejudice" letters on the issue of costs, since none of the letters was stated to be "without prejudice". But in my opinion regard can be had to informal offers to settle on the question of costs, though 0. 26 r. 9 will not be directly applicable. In this case, although the offer to settle made on 4 March 1993 was apparently framed in the light of the alternative claims made in the statement of claim, it is less favourable to the plaintiff than the terms of the order made by me on 16 March 1993, since it does not permit to the defendant the alternative of transferring to the plaintiff as his right, title and interest in the assets of the business conducted by the defendant. -- 9 of 10 -- 5 It was submitted for the defendant that I should limit the costs to those which the plaintiff would have recovered if the action had been brought in a District Court, on the basis of an opinion that the total value of the property in dispute between the parties did not exceed $200,000. But this is not an action to recover a debt or damages, and in my view 0. 91 r. 2 is inapplicable in these circumstances. In the circumstances, I consider that the order I should make is that the defendant pay the plaintiff's costs of and incidental to the action, including reserved costs, to be taxed. -- 10 of 10 --