Pangas v Permanent Trustee Australia Limited [2000] NSWSC 140

Pangas v Permanent Trustee Australia Limited [2000] NSWSC 140

The mortgage clause requiring payment of legal costs, charges and expenses "on a full indemnity basis" did not justify the widest Part 52A r37(a) basis. The mortgagee could recover only costs and disbursements actually incurred and paid that were not unreasonably or improperly incurred and were not of an unreasonable amount. Because the accounts provided insufficient detail in some respects, the mortgagee had to further particularise them and produce relevant files and costs agreements to a referee, who would make a broad appraisal of challenged items rather than conduct a formal assessment.

Jurisdiction
Australia
Judgment Date
10 March 2000
Procedural Posture
Equity Proceedings Concerning Accounts Between Mortgagor and Mortgagee as to Mortgagee's Costs and Expenses / Judgment on Residual Issue After Consent Orders for Distribution of Sale Proceeds
Outcome
Mortgagee's costs to be further particularised and then appraised by a referee; costs of the present proceedings reserved pending the referee's report.
Legal Topics
["mortgagee's Costs on an Indemnity Basis" 'construction of Mortgage Costs Provisions' 'particularisation of Legal Costs' 'referral to Referee' 'assessment or Appraisal of Costs']
['civil Procedure' 'equity' 'mortgages' 'costs'] ["mortgagee's Costs on an Indemnity Basis" 'construction of Mortgage Costs Provisions' 'particularisation of Legal Costs' 'referral to Referee' 'assessment or Appraisal of Costs']

Case Brief

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Procedural Posture

Equity Proceedings Concerning Accounts Between Mortgagor and Mortgagee as to Mortgagee's Costs and Expenses / Judgment on Residual Issue After Consent Orders for Distribution of Sale Proceeds

Legal Issues

  1. 1 ['Whether the words in clause 2.3 of the mortgage, "on a full indemnity basis", entitled the mortgagee to recover costs on the widest basis in Part 52A r37(a) of the Supreme Court Rules or on a narrower indemnity basis excluding costs unreasonably or improperly incurred or of an unreasonable amount.' 'Whether the First Defendant mortgagee had provided sufficient substantiation of the basis and reasonableness of the costs, particularly legal costs, in the accounts in Annexure "E".' 'Whether the Third Plaintiff mortgagor was entitled to have the relevant legal costs, totalling $115,867.50, or insufficiently substantiated items, referred to an assessor acting as referee with further substantiation.']

Ratio Decidendi

The mortgage clause requiring payment of legal costs, charges and expenses "on a full indemnity basis" did not justify the widest Part 52A r37(a) basis. The mortgagee could recover only costs and disbursements actually incurred and paid that were not unreasonably or improperly incurred and were not of an unreasonable amount. Because the accounts provided insufficient detail in some respects, the mortgagee had to further particularise them and produce relevant files and costs agreements to a referee, who would make a broad appraisal of challenged items rather than conduct a formal assessment.

Court Disposition

Mortgagee's costs to be further particularised and then appraised by a referee; costs of the present proceedings reserved pending the referee's report.

Orders

  • ['The First Defendant should provide an affidavit by a responsible officer identifying the relevant mortgage power under which particular costs and expenses were incurred and verifying that the costs and expenses were actually incurred.' 'The First Defendant should provide details of the interest charged and the...