McKeith v Royal Bank of Scotland Group PLC;; Royal Bank of Scotland Group PLC v James (No 2) [2016] NSWCA 260

Court of Appeal Supreme Court New South Wales Medium Neutral Citation: McKeith v Royal Bank of Scotland Group PLC;; Royal Bank of Scotland Group PLC v James (No 2) [2016] NSWCA 260 Hearing dates: On the papers Decision date: 14 September 2016 Before: Macfarlan JA at [1]; Tobias AJA at [2]; Emmett AJA at [87] Decision: Case number 113597 of 2015 (the James appeal) 1. Appeal allowed in part. 2. The order made by McDougall J on 27 March 2015 directing judgment for the Respondent against the Third Appellant in the amount of $2,932,692.31 together with pre-judgment interest in the amount of $1,490,149.15 be set aside. 3. In lieu thereof judgment be entered in favour of the Respondent against the First Appellant in the amount of $432,692.31 together with pre-judgment interest in the amount of $140,220.32. 4. The Respondent make further restitution to the Third Appellant in the amount of $82,607.88 noting that the Respondent on 1 April 2016 made restitution to the Third Appellant in the amount of $2,367,380.88. 5. The Respondent to pay to the Third Appellant interest on the restitutionary amount of $2,449,988.70 from 5 May 2015 to 1 April 2016 at the rate of 6 per cent per annum and on the further amount of $82,607.88 from 1 April 2016 to the date of payment of that amount at the rate of 6 per cent per annum. 6. The costs orders made on 22 July 2015 by McDougall J be set aside and in lieu thereof: a. the Appellants pay the Respondent's costs of the proceedings at first instance on an ordinary basis up to and including 26 April 2012; and b. the Respondent pay the Appellants' costs of the proceedings at first instance on an indemnity basis after 26 April 2012. 7. The Respondent pay 50 per cent of the Appellants' costs of their appeal on the ordinary basis. 8. The parties cooperate in recovering from the Australian Taxation Office (ATO) the amount of $1,225,000.00 in tax paid to the ATO by the First Appellant in respect of the amount of $2,500,000.00 ordered to be paid to the Respondent by McDougall J including, if necessary, by: a. the expeditious filing by the Respondent of his income tax return for the year ended 30 June 2015 claiming that income tax amount as a credit; and b. the payment of that amount by the Respondent to the Third Appellant upon receipt by him of a Notice of Assessment confirming that amount as a credit against his income tax. 9. Liberty to apply within seven days of the making of these orders for the purpose of correcting any error therein or omission therefrom which is inconsistent with this judgment.