Macquarie Publications Pty Ltd v Coles Supermarkets Australia Pty Ltd

1. [1]

   These proceedings were commenced on 31 October 2019.

2. [2]

   There has been some delay as a result of an unsuccessful attempt by the parties to resolve their differences at a mediation held on 6 February 2020.

3. [3]

   On 6 May 2020 directions were made for the parties to serve their lay and expert evidence. All lay evidence has now been served. The plaintiff, Macquarie Publications Pty Ltd, has served expert evidence, but only on the question of liability, notwithstanding the fact that the 6 May 2020 order specified “any” expert evidence. The defendant, Coles Supermarkets Australia Pty Limited is due to serve its expert evidence by 14 August 2020.

4. [4]

   Now, by notice of motion filed on 30 June 2020, Macquarie seeks an order pursuant to r 28.2 of the Uniform Civil Procedure Rules 2005 (NSW) that “the questions of liability be heard and determined in advance and separately from the question of damages”. In effect, Macquarie seeks to defer preparing and serving its expert evidence on quantum until it knows whether it has succeeded against Coles on liability.

5. [5]

   I am not persuaded to make the order sought by Macquarie.

Background

1. [6]

   Macquarie is the owner of premises in Five Dock within which Coles conducts a supermarket business.

2. [7]

   The premises include a basement car park.

3. [8]

   Clause 13(b) of the relevant lease [1] provides that:

4. [9]

   There is a dispute between Macquarie and Coles as to the amount of a reasonable charge or car parking fee for car park stays of more than 60 minutes in duration.

5. [10]

   On 7 August 2018 Macquarie sent Coles a proposal to impose charges for parking beyond 60 minutes (“the August 2018 Proposal”).

6. [11]

   Coles contends that it is unreasonable to levy any charge or car park fee for car park stays exceeding 60 minutes in duration but less than two hours, and that Macquarie’s proposed car parking fee for stays over two hours is excessive.

7. [12]

   At present, no charge or car parking fee is levied for car park stays exceeding 60 minutes. The parties have not been able to agree on a reasonable charge or fee.

8. [13]

   In those circumstances, in these proceedings Macquarie seeks declarations that:

9. [14]

   Macquarie also claims damages for the revenue it would otherwise have received had it been able to impose a charge, to which Coles acting reasonably agreed, for stays beyond 60 minutes.

10. [15]

    Macquarie accepts that damages recovered by it for lost revenue to date are likely to be relatively modest. However, as the lease has the potential to run for a further 56 years, the question has obvious significance in the long term.

11. [16]

    Macquarie’s expert evidence adduced thus far is directed at what a reasonable car parking charge would be at the moment.

12. [17]

    It includes evidence to the effect that some 85% of users of the car park stay for less than 60 minutes.

13. [18]

    To establish what damage it has suffered by reason of not having received car parking charges for stays over 60 minutes, Macquarie will need to establish what pattern of car parking use would have occurred had car park users been obliged to pay for parking beyond 60 minutes. It seems unlikely that imposition of a charge would have caused more persons to use the car park beyond 60 minutes than has occurred to date when there has been no charge. The effect of imposing a charge will presumably involve consideration of such matters as alternative parking opportunities in the vicinity, both on street and otherwise and the cost of such opportunities. In those circumstances I think the matter is likely to be more complex than simply multiplying current use numbers by whatever figure, if any, as is determined to be the figure to which Coles, acting reasonably, should have agreed. [2]

14. [19]

    In substance, Macquarie’s position was that the question of damages should be deferred because:

    1. (1)

       both parties will incur expense adducing on damages;

    2. (2)

       in light of the relatively modest amounts likely to be involved, it is likely that, assuming Macquarie succeeds on liability, the parties will agree on quantum;

    3. (3)

       the issues of liability and quantum are distinct.

Applicable legal principles

1. [20]

   The applicable legal principles are well known. They were recently summarised by Ball J in Arch Underwriting Agency (Australia) Pty Ltd v Lexon Insurance Pte Ltd [3] as follows:

This case

1. [21]

   I accept that both parties will incur further costs to address Macquarie’s damages claim and that the issues of liability and quantum will involve different, albeit related, expert inquiries.

2. [22]

   I do not accept Coles’ submission that the quantum of damages ultimately recoverable by Macquarie is likely to cast light on whether Coles’ refusal to accept Macquarie’s August 2018 Proposal was or was not reasonable. The latter question will turn on a number of matters, including the Court’s conclusion as to what car parking charge was at the relevant time reasonable for stays over 60 minutes, the course of negotiations between Macquarie and Coles and, possibly, the proper construction of cl 13(b) of the lease.

3. [23]

   However, I think it entirely speculative to suppose that acceding to the course proposed by Macquarie ultimately will result in a saving of time or cost.

4. [24]

   Of course, if Macquarie loses on liability, questions of quantum will not arise. But that is so in every case where a plaintiff fails.

5. [25]

   If Macquarie succeeds, and were quantum severed to be heard later, Macquarie would have to “satisfy Coles in any settlement discussions of the amount claimed”. [9] There appears to be a at least a reasonable prospect that this would involve Macquarie having to adduce the expert evidence that it is hoping to avoid by bringing this application.

6. [26]

   There has already been unsuccessful mediation. Coles’ solicitor has, in his affidavit, expressed doubt that quantum would be agreed. If agreement could not be reached, severing quantum from liability is likely to increase, not save costs.

7. [27]

   And Macquarie has left in until very late in the day to bring this application.

Conclusion

1. [28]

   Overall, I am not persuaded that Macquarie has sustained the onus of showing that severance of issues in this case is appropriate.

2. [29]

   I order that the plaintiff’s notice of motion of 30 June 2020 is dismissed with costs.

3. [30]

   I note that the matter is currently listed for directions on 21 August 2020.