Woods v McKinlay (No 4) [2023] NSWSC 873

Woods v McKinlay (No 4) [2023] NSWSC 873

The $20,000 to cover potential tax liabilities is to be withheld solely from Antoinette's indexed capital contribution, consistent with the logic of tax credits being properly applied to capital contributions in a failed joint endeavour. Antoinette's amendment to the Statement of Claim rendered the cross-claim otiose; accordingly, Orlene and David are entitled to the costs of the cross-claim, but only those costs exclusively referable to it.

Parties
Plaintiff/cross Defendant: Antoinette Woods; First Defendant/first Cross Claimant: Orlene Bernadette McKinlay; Second Defendant/second Cross Claimant: David Matthew McKinlay
Jurisdiction
Australia
Judgment Date
25 July 2023
Procedural Posture
Equity / Costs and Consequential Orders After Primary and Accounting Judgment
Outcome
Orlene and David's application successful.
Legal Topics
Constructive Trusts, Joint Endeavour, Failed Joint Endeavour, Form of Relief, Division of Sale Proceeds, Tax Liabilities, Costs of Cross Claim
Equity Constructive Trusts Joint Endeavour Failed Joint Endeavour Form of Relief Division of Sale Proceeds Tax Liabilities Costs of Cross Claim

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Parties

Antoinette Woods

Plaintiff/cross Defendant

Orlene Bernadette McKinlay

First Defendant/first Cross Claimant

David Matthew McKinlay

Second Defendant/second Cross Claimant

Procedural Posture

Equity / Costs and Consequential Orders After Primary and Accounting Judgment

Legal Issues

  1. 1 How should the $20,000 withheld for tax liabilities from the sale proceeds be apportioned between the parties?
  2. 2 Who should bear the costs of the cross-claim given the amendment to the Statement of Claim rendered it otiose?

Ratio Decidendi

The $20,000 to cover potential tax liabilities is to be withheld solely from Antoinette's indexed capital contribution, consistent with the logic of tax credits being properly applied to capital contributions in a failed joint endeavour. Antoinette's amendment to the Statement of Claim rendered the cross-claim otiose; accordingly, Orlene and David are entitled to the costs of the cross-claim, but only those costs exclusively referable to it.

Court Disposition

Orlene and David's application successful.

Orders

  • Antoinette to pay Orlene and David's costs of the present application.
  • Antoinette to pay Orlene and David's costs of the cross-claim, limited to costs solely referable to the cross-claim.