Vickers v Taccone [2005] NSWSC 578

New South Wales Supreme Court

CITATION : Vickers v Taccone [2005] NSWSC 578

HEARING DATE(S) : 8 June 2005

JUDGMENT DATE : 8 June 2005

JURISDICTION : Equity

JUDGMENT OF : Hamilton J

DECISION : Order in respect of possible capital gains tax liability refused.

CATCHWORDS : PROCEDURE [748] - Miscellaneous procedural matters - Declarations - Appropriate form of relief - Discretion of court - Other cases - Suit for damages for breach of contract for sale of land - Possible capital gains tax liability on judgment - Liability undetermined at date of hearing - Declaration sought that defendant indemnify plaintiff for any capital gains tax payable - No real possibility of capital gains tax liability demonstrated.

Duke Group Ltd (In Liquidation) v Pilmer (1999) 73 SASR 64 CASES CITED : Provan v HCL Real Estate Ltd (1992) 24 ATR 238; 9 BPR 16,895 Vickers v Taccone [2005] NSWSC 514

Graeme Arthur Vickers (P & XD) Augusta Taccone (1D & 1XC) PARTIES : Anthony Taccone (2D & 1XC) Geraway Pty Limited (3D & 2XC)

FILE NUMBER(S) : SC 5866/02

D Murray, Solicitor (P & XD) G Barry Hall (1 & 2Ds & 1XCs) COUNSEL : M Andrews, Solicitor (3D & 2XC)

Lane & Lane (P & XD) J P Lawyers (1 & 2Ds & 1XCs) SOLICITORS : Minter Ellison (3D & 2XC)

LOWER COURT JURISDICTION :

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

HAMILTON J

WEDNESDAY, 8 JUNE 2005

5866/02 GRAEME ARTHUR VICKERS v AUGUSTA TACCONE & ORS JUDGMENT 1 HIS HONOUR: In this matter, short minutes are laid before me this morning to permit orders to be made to give effect to the reasons for judgment I have delivered in these proceedings: Vickers v Taccone [2005] NSWSC 514. I do not propose to make orders for costs at the moment, and those orders will be excluded from the short minutes. 2 The only matter about which there has been controversy in court is whether an order can or may be made in the form sought by the plaintiff, that the first and second defendants are to pay any capital gains tax liability on the plaintiff as executor of the relevant estate, if it is claimed by the Commissioner of Taxation that there is such liability. 3 It is true, as Mr D Murray for the plaintiff has said this morning, that the inclusion of such a claim was opened at the commencement of the trial and mentioned during it. However, no argument was put to me at the trial by reference to the provisions of taxation law or evidence of any practice of the Taxation Commissioner or the view of any expert as to the likelihood and quantum of any capital gains tax, nor is any such detailed matter laid before me today. We are at the very heel of the hunt and I am not inclined to allow the matter to be stood over or protracted or reopened so as to permit such material to be brought forward at this very late stage. In fact no such application has actually been made. 4 Damages are generally ordered to be paid in a single lump sum for once and for all. No sum in relation to capital gains tax has been established as appropriate to be included in the damages. The possible alternative is that there should be a declaration that the first and second defendants are liable to the plaintiff for any sum subsequently assessed in this regard by the Commissioner of Taxation: Provan v HCL Real Estate Ltd (1992) 24 ATR 238; 9 BPR 16,895; Duke Group Ltd (In Liquidation) v Pilmer (1999) 73 SASR 64. That is based upon clause 9.3.1 of the contract, but, again, as I have already indicated, no material has been laid before me as to the likelihood of that liability arising, and I am far from certain that any liability could possibly arise. In those circumstances, I am not prepared to make any order in relationship to the payment of capital gains tax. 5 I have already indicated that I shall not today make orders as to costs. I shall shortly give directions as to how costs are to be dealt with. 6 As it is already after 10 o'clock and I have a trial scheduled to commence before me at 10, I shall not make orders at this moment but, having dealt with the matter of controversy that has been raised, I shall consider the form of the balance of the orders in private chambers and make orders later today.