Laidlaw v Hillier Hewitt Elsley Pty Ltd [2007] NSWSC 808

New South Wales Supreme Court

CITATION : Laidlaw v Hillier Hewitt Elsley Pty Ltd [2007] NSWSC 808

HEARING DATE(S) : 20 July 2007

JUDGMENT DATE : 24 July 2007

JURISDICTION : Equity Division

JUDGMENT OF : Rein AJ

DECISION : See [12] and [13].

CATCHWORDS : Dissolution of partnership - Rate of interest to be applied to moneys held by one partner after dissolution and before accounts taken

Civil Procedure Act 2005, s 100 LEGISLATION CITED : Partnership Act 1892, s 42 Supreme Court Act 1970, s 95

Barfield v Loughborough (1872) LR 8 Ch App 1 CASES CITED : Bartels v Behm (1990) 19 NSWLR 257 Behm v Bartels (1988) 14 NSWLR 432 Cavasinni v Cavasinni [2007] NSWSC 619

Joanne Lee Laidlaw (Plaintiff) Hillier Hewitt Elsley Pty Ltd (First Defendant) PARTIES : Paul Joseph Hewitt (Second Defendant) Edwin Hillier (Third Defendant) Scott Peter Elsley (Fourth Defendant)

FILE NUMBER(S) : SC 5977/04

COUNSEL : P Bolster (Plaintiff) M Ashhurst (Defendants)

SOLICITORS : Verekers (Plaintiff) Hewitts (Defendants)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

Rein AJ

24 July 2007

5977/04 Laidlaw v Hillier Hewitt Elsley Pty Ltd & Ors JUDGMENT 1 HIS HONOUR: On 6 July 2007 I delivered judgment in this matter, and on 19 July 2007 I heard argument on the form of orders. I indicated to the parties my decision on matters remaining outstanding concerning costs and interest and ordered the parties to bring in short minutes. The parties returned on 20 July 2007 with short minutes of order in respect of which all but one ventilated a further issue, namely the rate of interest. 2 By reason of adjustments which were agreed during the hearing and one which was not agreed (the amount due Laidlaw for her share of plant and equipment) and as a consequence of the rejection of Laidlaw's claim for further adjustment in respect of goodwill, it is agreed that the amount due to be paid by Laidlaw is $38,000. It is accepted by the Company that it has had the benefit of the $38,000 since the dissolution of the partnership on 31 March 2004. It is accepted in the light of my ruling that interest is to be paid on the $36,000 from 31 March 2004 to date. The Company asserts that the rate of interest should be that specified in s 42 of the Partnership Act 1892 ie 6 per cent. 3 Laidlaw submits that interest should be determined by s 100 of the Civil Procedure Act 2005. There is agreement on the figure that each approach yields. 4 Counsel referred me to a number of cases and texts: Behm v Bartels (1988) 14 NSWLR 432 (Young J, as he then was) and on appeal Bartels v Behm (1990) 19 NSWLR 257; Cavasinni v Cavasinni [2007] NSWSC 619; Lindley on Partnership paras 20-31, 20-35; Halsburys Laws of England, Butterworths, 1994, 4th ed, paras 147-148. Mr Bolster also referred me to clause 21 of the Partnership Deed which prescribes that interest is payable in accordance with s 95 of the Supreme Court Act 1970 that however is from the date of default in payment of moneys due to outgoing partner pursuant to clause 21. He submits that that gives some indication of what was intended, but accepted that the clause was not directly relevant since Laidlaw was not an outgoing partner. 5 Section 42 of the Partnership Act 1892 is in the following terms: " 42 Right of outgoing partner in certain cases to share profits made after dissolution