AIP Property Holdings Pty Ltd v Fellowship of the Esoteric School of Higher Learning Ltd

The case of AIP Property Holdings Pty Ltd v Fellowship of the Esoteric School of Higher Learning Ltd was heard in the Supreme Court of New South Wales. The dispute centred around the withdrawal of a caveat by the respondent, the Fellowship of the Esoteric School of Higher Learning Ltd, against a property owned by the applicant, AIP Property Holdings Pty Ltd. The applicant sought an order for the respondent to pay its costs after successfully applying to have the caveat withdrawn, arguing that the usual rule that costs follow the event should apply.

The primary legal issue the court had to address was whether the usual rule that costs follow the event should be applied when a party successfully applies to withdraw a caveat. The applicant contended that the respondent's application to withdraw the caveat was vexatious and that, as a result, the usual rule should be departed from, and the respondent should be ordered to pay the applicant's costs. The respondent argued that the usual rule should apply, and since the caveat had been withdrawn, the respondent should not be ordered to pay the applicant's costs.

The court found that the application to withdraw the caveat was not vexatious. It held that the respondent was not abusing the process of the court and that the caveat had been withdrawn because the respondent was no longer claiming an interest in the property. The court emphasised that there was no issue of principle involved in applying the usual rule that costs follow the event. Consequently, the court ordered that the respondent pay the applicant's costs of the application to withdraw the caveat. The court found no merit in the applicant's argument that the usual rule should not apply in this case.