Gadens Lawyers Sydney Pty Limited v Symond [2015] NSWCA 50

Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Gadens Lawyers Sydney Pty Limited v Symond [2015] NSWCA 50 Hearing dates: 18, 19 August 2014 Decision date: 17 March 2015 Before: McColl JA, Gleeson JA, Tobias AJA Decision: (1)Appeal allowed in part.

(2)Order that the judgment for the respondent in the amount of $4,979,800 made by Beech-Jones J on 31 October 2013 be set aside and in lieu thereof there be judgment for the respondent in the amount of $3,397,911.

(3)Order that the appellant pay 75 per cent of the respondent's costs of the appeal.

(4)Order that the cross-appeal filed on behalf of the respondent be dismissed with costs.

(5)Order that the respondent repay to the appellant the sum of $1,581,889.

(6)Declare that the respondent is obliged to pay to the appellant interest calculated in accordance with the rates prescribed by Uniform Civil Procedure Rules 2005 (NSW), r 36.7(1), from the date of payment of so much of the judgment debt as exceeded $3,397,911.

(7)Liberty to apply for further relief. Catchwords: DAMAGES – measurement of loss or damages – tax consequences of restructure – whether primary judge erred in the relevant comparison in determining loss – difference in tax consequences of restructure as implemented compared to structure that respondent would have pursued "but for" the negligent advice – difference between respondent's financial position under the restructure and the "but for" scenario – benefit of restructure as implemented – whether benefit from paying dividends later under the restructure rather than earlier under the "but for" scenario is permanent or temporary – measurement of benefit – valuation of deduction in franking credits from franking account – whether primary judge erred in evaluating the loss to the respondent due to the forfeiture of franking credits INTEREST – recoverable pre-judgment interest – character of benefits of restructure and actual payments made on settlement due to negligent advice APPEAL – new point of appeal not relied upon at trial – whether appellant bound by conduct of case at trial Legislation Cited: Civil Procedure Act 2005 (NSW) s 100 Income Tax Assessment Act 1936 (Cth) Div 7A, s 109C Income Tax Assessment Act 1997 (Cth) s 200.15 Trade Practices Act 1974 (Cth) s 52 Cases Cited: Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 [2014] HCA 36 Commonwealth of Australia v Amann Aviation Pty Ltd [1991] HCA 54; 174 CLR 64 D'Orta -Ekenaike v Victoria Legal Aid [2005] HCA 12; 223 CLR 1 Heydon v NRMA Ltd (No 2) [2001] NSWCA 445; 53 NSWLR 600 Johnson v Perez [1988] HCA 64; 166 CLR 351 Mamo v Surace [2014] NSWCA 58; 86 NSWLR 275 Metwally v University of Wollongong [1985] HCA 28; 60 ALR 68 Mills v Commissioner of Taxation (2011) 198 FCR 89 Mills v Commissioner of Taxation [2012] HCA 51; (2012) 250 CLR 171 Multicon Engineering Pty Ltd v Federal Airports Corporation (1997) 47 NSWLR 631 Murphy v Overton Investments Pty Ltd [2004] HCA 3; 216 CLR 388 Ng v Filmlock Pty Ltd [2014] NSWCA 389 Sellars v Adelaide Petroleum NL [1994] HCA 4; (1994) 179 CLR 332 Suttor v Gundowda Pty Ltd [1950] HCA 35; 81 CLR 418 Symond v Gadens Lawyers Pty Ltd (No 2) [2013] NSWSC 1578 Symond v Gadens Lawyers Sydney Pty Ltd [2013] NSWSC 955 Wardley Australia Ltd v Western Australia [1992] HCA 55; 175 CLR 51 Water Board v Moustakas [1988] HCA 12; 180 CLR 491 Category: Principal judgment Parties: Gadens Lawyers Sydney Pty Limited (Appellant) John Joseph Symond (Respondent) Representation: Counsel: J de Wijn QC / D McInerney (Appellant) AJ Payne SC / JO Hmelnitsky SC / MS Symon (Respondent)