Bartier Perry Pty Ltd v Paltos [2021] NSWCA 158

Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Bartier Perry Pty Ltd v Paltos [2021] NSWCA 158 Hearing dates: 6–7 April 2021; last written submissions 5 July 2021 Date of orders: 3 August 2021 Decision date: 03 August 2021 Before: Payne JA at [1]; White JA at [261]; McCallum JA at [262] Decision: (1) Bartier Perry's motion dated 19 March 2021 seeking to lead fresh evidence is dismissed; (2) Appeal allowed; (3) Set aside orders 2 and 5 made by Rothman J on 1 December 2020 (including the undertaking offered as a condition of making order 2) and in lieu thereof order: (a) Bartier Perry to pay damages to Mr Paltos in the amount of $942,777; (b) Bartier Perry to pay Mr Paltos' costs of the proceedings on the ordinary basis; (4) No order as to costs of the appeal with the intention that the parties pay their own costs of the appeal; (5) Cross-appeal dismissed; (6) Cross-appellant to pay the costs of the cross-respondent of the cross-appeal. Catchwords: NEGLIGENCE – professional negligence – solicitors – where appellant law firm was retained to advise the respondent as to his rights in a family law partnership – whether appellant failed to give competent advice to the respondent about the manner and circumstances of the exercise of a put option granted by a put and call option agreement forming part of the partnership documents – breach of retainer and concurrent duty of care NEGLIGENCE – professional negligence – causation – factual causation – where respondent would have exercised put option had he been properly advised of his rights – where failure to give competent advice caused loss CONSUMER LAW – misleading or deceptive conduct – professional advice – where a dangerously incomplete statement of the respondent's rights was misleading and deceptive in that it was apt to mislead the respondent into believing that his legal rights were ineffective CONTRACTS – implied terms – terms implied in law – necessity CONTRACTS – implied terms – terms implied in fact – necessary to give business efficacy CONTRACTS – construction – interpretation – calculation of purchase price under formula prescribed in a put and call option agreement APPEALS – damages – where primary judge awarded damages and required an undertaking as to repayment pending the outcome of related proceedings – whether primary judge erred in not assessing damages on a lump sum basis once and for all – whether this Court should itself determine the damages payable on a lump sum basis – approach for correct assessment of damages Legislation Cited: Civil Liability Act 2002 (NSW), ss 5D, 5E Civil Procedure Act 2005 (NSW), ss 56, 98, Part 6 Competition and Consumer Act 2010 (Cth), s 82, Sch 2 ss 18, 236 Evidence Act 1995 (NSW), s 91 Income Tax Assessment Act 1997 (Cth), s 118-37 Partnership Act 1890 (UK), s 38 Supreme Court Act 1970 (NSW), ss 23, 63, 75A Taxation Administration Act 1953 (Cth), Part IVC Trade Practices Act 1974 (Cth), s 82 Uniform Civil Procedure Rules 2005 (NSW), rr 42.1, 51.53 Cases Cited: Adeels Palace Pty Ltd v Moubarak (2009) 239 CLR 420; [2009] HCA 48 Arundell v Bell (1883) 52 L J Ch 537 Australian Executor Trustees (SA) Ltd v Kerr [2021] NSWCA 5 Blatch v Archer (1774) 1 Cowper 63; (1774) 98 ER 969 Bostik Australia Pty Ltd v Liddiard (No 2) [2009] NSWCA 304 BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266; [1977] UKPCHCA 1 Bridge v Deacons [1984] AC 705 Burchell v Wilde [1900] 1 Ch 551 Byrne v Australian Airlines Ltd (1995) 185 CLR 410; [1995] HCA 24 Carazi Pty Ltd v Blow Dry Bar Franchising Pty Ltd (in liq) (No 2) [2015] NSWSC 108 Castlemaine Tooheys Ltd v Carlton & United Breweries Ltd (1987) 10 NSWLR 468 Commissioner of Taxation (Cth) v Murry (1998) 193 CLR 605; [1998] HCA 42 Commonwealth Bank of Australia v Barker (2014) 253 CLR 169; [2014] HCA 32 Commonwealth v Amman Aviation Pty Ltd (1991) 174 CLR 64; [1991] HCA 54 Council of The City of Botany Bay v Michos [2013] NSWCA 244 Doherty v Liverpool District Hospital (1991) 22 NSWLR 284 Doppstadt Australia Pty Ltd v Lovick & Son Developments Pty Ltd (No 2) [2014] NSWCA 219 E K Nominees Pty Ltd v Woolworths Ltd [2006] NSWSC 1172 Fexuto Pty Ltd v Bosnjak Holdings Pty Ltd (No 3) (1998) 30 ACSR 20 Fitch v Dewes [1921] 2 AC 158 Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 Geraghty v Minter (1979) 142 CLR 177; [1979] HCA 42 Great Wall Resources v O'Sullivan [2009] NSWCA 119 HTW Valuers (Central Qld) Pty Ltd v Astonland Pty Ltd (2004) 217 CLR 640; [2004] HCA 54 James v Surf Road Nominees Pty Ltd (No 2) [2005] NSWCA 296 Johnson v Perez (1988) 166 CLR 351; [1988] HCA 64 Kizbeau Pty Ltd v WG & B Pty Ltd (1995) 184 CLR 281; [1995] HCA 4 Liverpool City Council v Irwin [1977] AC 239 Malec v JC Hutton Pty Ltd (1990) 169 CLR 638; [1990] HCA 20 March v E & MH Stramare Pty Ltd (1991) 171 CLR 506; [1991] HCA 12 McAllister v Richmond Brewing Co (NSW) Pty Ltd (1942) 42 SR (NSW) 187 Mellersh v Keen (No 2) (1860) 28 Beav 453 Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd (1991) 33 FCR 1; [1991] FCA 758 Murphy v Overton Investments Pty Ltd (2004) 216 CLR 388; [2004] HCA 3 Old v McInnes and Hodgkinson [2011] NSWCA 410 Page v McKensey [1995] NSWCA 351 Page v McKensey (Supreme Court (NSW), Windeyer J, 17 December 1993, unrep) Paltos v Bartier Perry Pty Ltd [2020] NSWSC 705 Paltos v Bartier Perry Pty Ltd (No 2) [2020] NSWSC 1706 Pennant Hills Restaurants Pty Ltd v Barrell Insurances Pty Ltd (1981) 145 CLR 625; [1981] HCA 3 Polkinghorne v Holland (1934) 51 CLR 143; [1934] HCA 28 Potts v Miller (1940) 64 CLR 282; [1940] HCA 43 Rabelais Pty Ltd v Cameron (1995) 95 ATC 4552 Re David and Matthews [1899] 1 Ch 378 Ruthol Pty Ltd v Tricon (Australia) Pty Ltd [2005] NSWCA 443 Ryder v Frohlich [2004] NSWCA 472 Ryder v Frohlich [2006] NSWSC 833 Sellars v Adelaide Petroleum NL (1994) 179 CLR 332; [1994] HCA 4 Smith v Everett (1859) 27 Beav 446 Sobell v Boston [1975] 2 All ER 282 SRSC v Beaumont [2004] NSWSC 164 Thames Cruises Ltd v George Wheeler Launches Ltd [2003] EWHC 3093 Todorovic v Waller (1981) 150 CLR 402; [1981] HCA 72 Trego v Hunt [1895] 1 Ch 462 Turner v TR Nominees Pty Ltd (1995) 31 ATR 578 Tyco Australia Pty Ltd v Optus Networks Pty Ltd [2004] NSWCA 333 Unity Insurance Brokers Pty Ltd v Rocco Pezzano Pty Ltd (1998) 192 CLR 603; [1998] HCA 38 Walton v Illawarra [2011] NSWSC 1188; (2012) 28 BCL 202 Wardley Australia Ltd v Western Australia (1992) 175 CLR 514; [1992] HCA 55 Wilson v Williams (1892) 29 L R Ir 176 Texts Cited: R I Banks, Lindley & Banks on Partnership (20th ed, 2020, Thomson Reuters) Category: Principal judgment Parties: Bartier Perry Pty Ltd (Appellant) Dennis Paltos (Respondent) Representation: Counsel: J Emmett SC with H Grace (Appellant) I R Coleman SC with C D Freeman (Respondent)