Oldendorff Carriers GmbH & Co. KG v Tharmalingam

• Jurisdiction: Australia Federal only
• Judge: RARES J
• Judgment Date: 18 December 2019
• Neutral Citation: [2019] FCA 2020
• Date: 18 December 2019
• Court: Federal Court

FEDERAL COURT OF AUSTRALIA

Oldendorff Carriers GmbH & Co. KG v Tharmalingam [2019] FCA 2020

File number:	NSD 121 of 2018
Judge:	RARES J
Date of judgment:	18 December 2019
Catchwords:	PRACTICE AND PROCEDURE - referee - application for adoption of referees’report under s 54A of the Federal Court of Australia Act 1976 (Cth) - where no reason to not adopt referees’assessment of damages and costs ; COSTS - pre-judgment interest on foreign currency amount under s 51A of the Federal Court of Australia Act 1976 (Cth) - assessment of appropriate rate of pre-judgment interest to apply where judgment sum in United States dollars - where award of pre-judgment interest is compensatory in nature
Legislation:	Competition and Consumer Act 2010, Sch 2 (Australian Consumer Law) ss 18, 236 Federal Court of Australia Act 1976 (Cth) ss 37M, 39, 51A, 54A Federal Court Rules 2011 rr 5.21, 5.23, 11.02, 16.02-16.08, 28.65, 28.66, 28.67
Cases cited:	Ahmad v Minister for Immigration and Border Protection [2018] FCAFC 199 Buckley v Bennell Design & Constructions Pty Limited (1978) 140 CLR 1 Chocolate Factory Apartments v Westpoint Finance [2005] NSWSC 784 CPB Contractors Pty Limited v Celsus Pty Limited (No 2) (2018) 364 ALR 129 Optiver Australia Pty Limited v Tibra Trading Pty Limited (2012) 203 FCR 520 Suzlon Energy Ltd v Bangad (No 2) [2014] FCA 1173
Date of hearing:	14 November 2019
Date of last evidence:	28 November 2019
Registry:	New South Wales
Division:	General Division
National Practice Area:	Admiralty and Maritime
Category:	Catchwords
Number of paragraphs:	34
Counsel for the Applicant:	Ms C O Gleeson
Solicitor for the Applicant:	HFW Australia
Counsel for the Respondents:	The Respondents did not appear

ORDERS

		NSD 121 of 2018
BETWEEN:	OLDENDORFF CARRIERS GMBH & CO. KG Applicant
AND:	SHANKARALINGAM THARMALINGAM First Respondent ; BATTELLE HOLDINGS PTY LTD Second Respondent

JUDGE:	RARES J
DATE OF ORDER:	18 December 2019

THE COURT ORDERS THAT:

1. The respondents pay the applicant USD1,830,408.68 (inclusive of prejudgment interest up to 28 November 2019 of USD271,161.93) pursuant to s 51A of the Federal Court of Australia Act 1976 (Cth).

2. The respondents pay the applicant’s costs of AUD32,678.

3. Interest on so much of the judgment sum in order 1 as is unpaid accrue at the published official maximum target (interest) rates set by the Federal Reserve Bank of New York of the United States of America plus 3.106% during any period or periods while it remains unpaid.

4. Orders 1, 2 and 3 take effect as and from 28 November 2019.

5. The time in which the respondents may file a notice of appeal be extended to 28 days after today.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

(REVISED FROM THE TRANSCRIPT)

RARES J:

1. This is an application to adopt the report of the two referees, who are judicial registrars of the Court whom I appointed, pursuant to s 54A of the Federal Court of Australia Act 1976 (Cth) (the Federal Court Act), on 7 November 2018, to determine the quantum of the claims of the applicant, Oldendorff Carriers GmbH & Co KG, for damages in its originating application and for the costs of the proceeding.

2. I made the order for the reference in consequence of my determining on 7 June 2018 that there be judgment in favour of Oldendorff in accordance with r 5.21 of the Federal Court Rules 2011, and that its damages be assessed in accordance with r 5.23(2)(d) and (e). The two respondents, Shankaralingam Tharmalingam and Battelle Holdings Pty Ltd, had defaulted in complying with several orders to file and serve their defences in the form required by rr 16.02 to 16.08 and, if it intended to appear, for Battelle to file and serve a notice of address for service pursuant to r 11.02 (so that a lawyer, as opposed to Mr Tharmalingam personally, acted for it). I made orders initially on 22 March 2018 but subsequently varied the orders on more than one occasion to extend the time by which the respondents had to comply with them. The last extension gave the respondents until 31 May 2018 to comply.

The referees’ report

3. The referees reported on 19 June 2019 that, in accordance with r 28.66(b), in their opinion:

• Oldendorff was entitled to USD1,559,246.75 in damages for Battelle’s breach of the charterparty between them dated 21 August 2015, and or the respondents’ misleading or deceptive conduct in contravention of s 18 of the Australian Consumer Law in Sch 2 of the Competition and Consumer Act 2010 (Cth); and

• Oldendorff’s costs of the proceeding be assessed in the amount of AUD32,678.

4. Oldendorff claimed in its statement of claim that it had relied on representations that the respondents made when entering into the charterparty and subsequently. The charterparty was on the Americanized Welsh Coal Charter form (amended in 1979) for the charter of Tao Hua Hai to lift a cargo of coal from Newcastle, New South Wales, to the port of Krishnapatnam, India, on the basis of a freight rate of USD9.50 per metric ton. As noted in cl 1 of the charterparty, the ship’s capacity was between 108,000 and 118,800 metric tons.

5. In the event, Battelle was unable to arrange for the carriage of any cargo on the ship. The pleading in the statement of claim the subject of the default judgment alleged that:

• Mr Tharmalingam, on each of his own and or Battelle’s behalf, continued to represent to Oldendorff that it should not terminate the charterparty after it had delivered the ship into Battelle’s service at Newcastle on 8 September 2015 because Battelle would perform and would be able to meet its obligations to pay the freight under the charterparty;

• after 8 September 2015, the ship remained ready and able to load the cargo until Oldendorff terminated the charterparty on 1 December 2015 and fixed the ship on that day on another charter; and

• Oldendorff had relied on the representations, had lost the opportunity to terminate the charterparty earlier than 1 December 2015 and refix the ship, and had incurred expense in daily hire costs, operational expenses and the cost of bunkers while she waited at Newcastle.

6. On 22 October 2019, I fixed the hearing of the application to adopt the report for today and directed that if the respondents wished to oppose its adoption, they file and serve any written submissions and any affidavits upon which they proposed to rely on or before 31 October 2019, and that Oldendorff file and serve any written submissions in response and any affidavits on which it proposed to rely on or before 8 November 2019.

The principles

7. A purpose of the Court adopting the separate mode of trial of a proceeding, or one or more issues in a proceeding, by using a referee is to achieve what is now expressed in the overarching purpose in s 37M of the Federal Court Act, namely to facilitate the just resolution of the dispute according to law, as quickly, inexpensively and efficiently as possible: see, e.g., Optiver Australia Pty Limited v Tibra Trading Pty Limited (2012) 203 FCR 520 at 530-532 [33]-[41], where I discussed the principles. In CPB Contractors Pty Limited v Celsus Pty Limited (No 2) (2018) 364 ALR 129 at 145-147 [67]-[71], Lee J also discussed the principles and adopted expressly what McDougall J had said in Chocolate Factory Apartments v Westpoint Finance [2005] NSWSC 784 at [7]. There, McDougall J synthesised the principles that had emerged...