Actuarial Outlook Pty Ltd v Holmans Pty Ltd (No 2)

[2017] NSWSC 1732

Supreme Court

New South Wales

Medium Neutral Citation:	Actuarial Outlook Pty Ltd v Holmans Pty Ltd (No 2) [2017] NSWSC 1732
Hearing dates:	On the papers
Date of orders:	12 December 2017
Decision date:	12 December 2017
Jurisdiction:	Common Law
Before:	Adamson J
Decision:	(1) Order each party to pay its own costs of the plaintiff’s notice of motion filed 7 November 2017.
Catchwords:	COSTS – whether successful party ought have order for costs in favour – partial success – application under Uniform Civil Procedure Rules, r 42.34 must be made irrespective of attitude of other party – HELD – appropriate for each party to pay its own costs of the motion
Legislation Cited:	Civil Procedure Act 2005 (NSW), s 98 Uniform Civil Procedure Rules 2005 (NSW), rr 42.1, 42.34
Cases Cited:	Actuarial Outlook Pty Ltd v Holmans Pty Ltd [2017] NSWSC 1563
Category:	Costs
Parties:	Actuarial Outlook Pty Ltd as trustee for Dowsett Family Trust (ACN 118 035 608)(Plaintiff) Holmans Pty Ltd (ACN 108 110 667) (Defendant)
Representation:	Counsel: D Toomey SC/D Neggo (Plaintiff) C Bova/B Ng (Defendant)     Solicitors: Ironside & Shillington (Plaintiff) Lander & Rogers (Defendant)
File Number(s):	2015/145128

Judgment

1. On 17 November 2017 I ordered the defendant to pay the plaintiff’s costs of the proceedings up to 5 October 2017 and published reasons for my decision: Actuarial Outlook Pty Ltd v Holmans Pty Ltd [2017] NSWSC 1563. I made the following order with respect to the costs of the notice of motion filed on 7 November 2017:

“(2) Unless either party makes a different application in writing, with evidence relied on in support, to my Associate within 7 days, order the defendant to pay the plaintiff’s costs of the notice of motion filed on 7 November 2017.”

2. On 24 November 2017 the defendant applied for an order that the plaintiff pay the defendant’s costs of the motion; or, in the alternative, that each party should bear its own costs of the motion. On 1 December 2017 the plaintiff responded to the defendant’s application and confirmed that it sought an order that the defendant pay the plaintiff’s costs of the motion but that it did not press a claim for those costs on an indemnity basis.

3. The defendant submitted that the ordinary rule that costs follow the event was displaced in the present case. It contended that the plaintiff was obliged to bring the motion in any event since it was required to satisfy the Court under r 42.34 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) that the commencement and continuation of the proceedings in this Court was warranted before an order for the costs of the proceedings in its favour could be made. The defendant argued that, in these circumstances, the costs of the motion were required to be incurred by the plaintiff, irrespective of the defendant’s attitude to the motion. The defendant submitted that, in effect, the plaintiff was seeking an indulgence from this Court and therefore ought bear the costs of the application.

4. The defendant also submitted that it had not acted unreasonably in opposing the plaintiff’s motion for costs and that it had not read any evidence. It submitted that the appropriate exercise of this Court’s discretion under s 98 of the Civil Procedure Act 2005 (NSW) would be to order the plaintiff to pay the defendant’s costs of the motion.

5. In the alternative the defendant submitted that each party should pay its own costs of the motion. It submitted that there were two issues which required determination:

1. whether UCPR r 42.34 applied only to judgments obtained after contested hearings or to any judgment (the construction issue);

2. whether the commencement and continuation of the proceedings in this Court was warranted such as to make it appropriate that the defendant pay the plaintiff’s costs of the proceedings notwithstanding that the judgement sum was less than $500,000 (the discretionary issue).

6. The defendant submitted that, although it was unsuccessful on the discretionary issue, it succeeded on the construction issue and that, therefore, it was appropriate that each party be ordered to pay its own costs of the notice of motion.

7. The plaintiff contended that the application for costs was not properly characterised as an “indulgence” and that therefore the authorities which established that, as a matter of general principle, a party seeking an indulgence ought pay the costs of the other party were inapposite in the present case. It also submitted that the construction issue (in respect of which it was unsuccessful) was a discrete issue which did not significantly add to the time of the hearing of the motion. It argued that there was no reason to depart from the general principle that costs ought follow the event: UCPR r 42.1.

Consideration

8. Ordinarily the plaintiff would be entitled to its costs of the motion since it succeeded in obtaining the relief sought (its costs of the proceedings). However, it was unsuccessful on the construction issue. Further, while the plaintiff succeeded in persuading me that it was appropriate that the defendant be ordered to pay its costs of the proceedings notwithstanding that the judgment sum was less than $500,000, the costs incurred by the plaintiff in making that argument would have been incurred in any event even had the defendant not opposed the order. The plaintiff had a positive obligation to satisfy the Court of the matters set out in UCPR r 42.34 before a costs order could be made in its favour.

9. Although it was open to the defendant to submit to any order of the court save as to costs on the notice of motion (and thereby save its own costs of opposing it), the defendant’s decision to oppose the motion was vindicated, to some extent, by my acceptance of its arguments on the construction issue. Moreover, it was of assistance to the Court that there was a contradictor on the construction issue and, indeed, on the discretionary issue. While it may be accepted that the defendant’s opposition to the plaintiff’s application on the discretionary issue increased the length of the hearing time, the increase was not significant as the matter began at 10am and concluded in the course of the morning.

10. In these circumstances, I am persuaded by the defendant’s submissions on the alternative basis that the appropriate order is that each party bear its costs of the motion. These costs include the costs of the costs submissions.

Orders

11. For the reasons set out above, I make the following order:

1. Order each party to pay its own costs of the plaintiff’s notice of motion filed 7 November 2017.

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Decision last updated: 13 December 2017