JUDGE:	VICKERY J
WHERE HELD:	Melbourne
DATE OF HEARING:	31 August–2 September, 3 September and 9 September 2015
DATE OF JUDGMENT:	18 December 2015
CASE MAY BE CITED AS:	1165 Stud Road v Power & Ors (No 2)
MEDIUM NEUTRAL CITATION:	[2015] VSC 735

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COSTS – Non-party cost applications – Alleged breaches of overarching obligations under Civil Procedure Act 2010 (Vic) – Section 29 applications – Section 30 time limit not observed – Whether proceeding ‘finalized’ for the purposes of s 30 – Section 29 application statute barred - No jurisdiction to make a s 29 order – Inherent jurisdiction of the Court to make a non-party costs order – Section 24 Supreme Court Act 1986 – Knight v FP Special Assets Limited (1992) 174 CLR 178 considered and applied against one non-party – Rule 63.23 Supreme Court (General Civil Procedure) Rules2005 (Vic) considered but not applied – Principles of Flower & Hart (a firm) v White Industries (Qld) Pty Ltd (1999) 87 FCR 134 on indemnity costs applied against one non-party.

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APPEARANCES:	Counsel	Solicitors
For the Third Defendant	Mr O’Bryan SC Mr C Truong	Arnold Bloch Leibler
For the First and Second non-party respondents to the Third Defendant’s summons	Mr M Clarke	Ms Michelle HM Ong
For the Third non-party respondent to the Third Defendant’s summons	Mr S Pitt	R B Flinders

HIS HONOUR:

The Third Defendant, Palms Court Management Pty Ltd (“Palms”), makes application for costs against non-parties in this proceeding brought by the Plaintiff, 1165 Stud Road (the “Proceeding”).

In particular, Palms, by its summons filed 22 December 2014, makes application to the Court for costs orders jointly and severally, and on an indemnity basis (the “Costs Applications”), against each of the following non-party respondents (the “Respondents” or the “Non-party Respondents”):

(a)John Gdanski (“Gdanski”) (a former director and solicitor acting for the Plaintiff, 1165 Stud Road Pty Ltd (In Liquidation)) (the “Plaintiff” or “1165 Stud Road”);
(b)Renato Chilelli (“Chilelli”) (a former director of the Plaintiff, 1165 Stud Road); and
(c)Rockwell Bates Pty Ltd (“Rockwell Olivier”) (an incorporated law practice trading as “Rockwell Olivier”).

The Costs Applications are made by Palms:

(a)against Gdanski on the basis of alleged breaches of the Civil Procedure Act 2010 (Vic) (the “CPA”), r 63.23 of the Supreme Court (General Civil Procedure) Rules2005 (Vic) (the “Supreme Court Rules”) and in the Court’s inherent jurisdiction;

(b) against Chilelli on the basis of the Court’s inherent jurisdiction;
(c)against Rockwell Olivier on the basis of alleged breaches of the CPA, r 63.23 of the Supreme Court Rules and the Court’s inherent jurisdiction, and
(d)against all Non-party Respondents on an indemnity basis pursuant to the principles expressed in Flower & Hart (a firm) v White Industries (Qld) Pty…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading 1165 Stud Road v Power (No 2)

Details

AGLC: 1165 Stud Road v Power (No 2) [2015] VSC 735
Case: [2015] VSC 735
Decision Date: 18 December 2015

CaseChat Overview and Summary

The case of 1165 Stud Road v Power (No 2) involved the applicants, 1165 Stud Road, and the defendant, Power, with the non-party being a law firm, which had been involved in legal proceedings with Power. The dispute was regarding an application for costs against the non-party law firm, which had allegedly breached its overarching obligations under the Civil Procedure Act 2010 (Vic). The matter was heard in the Supreme Court of Victoria.

The primary legal issue that the court had to decide was whether it had jurisdiction to make a costs order against the non-party law firm under section 29 of the Civil Procedure Act 2010 (Vic), given that the application was made outside the 30-day time limit specified in section 30. The court also had to determine whether the proceeding had been 'finalised' for the purposes of section 30 and whether the non-party cost application was statute-barred. Additionally, the court needed to assess whether it had the inherent jurisdiction to make a non-party costs order and if the principles of indemnity costs applied to the non-party in this case.

The court held that it did not have jurisdiction to make a section 29 order against the non-party law firm as the application was made beyond the 30-day time limit, and the proceeding had not been 'finalised' for the purposes of section 30. However, the court found that it did have the inherent jurisdiction to make a non-party costs order. The court applied the principles of indemnity costs, as established in Flower & Hart (a firm) v White Industries (Qld) Pty Ltd, against the non-party law firm. The court also considered the relevant provisions of the Supreme Court Act 1986 and the Supreme Court (General Civil Procedure) Rules 2005 (Vic) but did not apply them in this case.

As a result, the court ordered the non-party law firm to pay the costs of the application in accordance with the principles of indemnity costs. This decision was based on the inherent jurisdiction of the Supreme Court and the application of the principles established in Flower & Hart (a firm) v White Industries (Qld) Pty Ltd.

Orders