This case is a strong reminder that transaction documents do not stop mattering after completion. A deed of indemnity, a deed of novation and later settlement offers became central to who paid the commercial bill years later. The live dispute was not just whether the receivers could recover $900,000. It was also who had to pay the legal costs of defending the Commonwealth claim and fighting the cross-claims.
The Court found that Thorn Australia's position on the novation and estoppel issues was without merit and that it should have appreciated the risk from the outset. Calderbank offers had spelt out why Thorn Australia was exposed. Because of that conduct, the Court ordered indemnity costs and made a Sanderson order shifting 1stCash's costs to Thorn Australia rather than leaving the receivers to pay costs for having sued the wrong party in the alternative.
For business owners, this is the contract-administration lesson. If a sale, refinance, restructuring or settlement transfers liabilities, the documents need to name the responsible party cleanly. If a party later denies liability despite the documents and the commercial history pointing the other way, cost exposure can become much larger than the original disputed payment. Keep novations, indemnities, settlement offers and board approvals together so the risk trail is obvious before a dispute reaches Court.