Allen v G8 Education Ltd (No 3) - [2022] VSC 302

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

GROUP PROCEEDINGS LIST

S ECI 2020 04339

PAUL ALLEN	First Plaintiff
and
MONIKA ALLEN	Second Plaintiff
v
G8 EDUCATION LIMITED (ACN 115 832 963)	Defendant

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JUDGE:	NICHOLS J
WHERE HELD:	Melbourne
DATE OF RULING:	6 June 2022 (on the papers)
CASE MAY BE CITED AS:	Allen v G8 Education Ltd (No 3)
MEDIUM NEUTRAL CITATION:	[2022] VSC 302

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COSTS – Group proceedings – Successful application for a Group Costs Order under s 33ZDA of the Supreme Court Act 1986 – Indemnity principle considered – Identification of the “event” which costs are to follow on an application for a Group Costs Order – Where defendant made only confined submissions and otherwise neutral to the application – Fairness considerations in according costs – Plaintiff to bear own costs and defendant’s costs reserved.

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WRITTEN SUBMISSIONS:	Counsel	Solicitors
For the Plaintiffs	Slater and Gordon
For the Defendant	RG Craig QC with HC Whitwell	MinterEllison

HER HONOUR:

This is a group proceeding issued under Part 4A of the Supreme Court Act1986 (Vic) (the Act). On the plaintiffs’ application heard on 26 November 2021 I made a Group Costs Order (GCO) pursuant to s 33ZDA of the Act, in the following terms:

1. The legal costs payable to the solicitors for the plaintiff and group members, Slater and Gordon Lawyers, be calculated as a percentage of the amount of any award or settlement that may be recovered in the proceeding, that percentage being 27.5% inclusive of GST (subject to further order); and
2. Liability for payment of the legal costs pursuant to paragraph 1 be shared among the plaintiff and all group members.[1]

[1]See Allen v G8 Education Ltd [2022] VSC 32 (7 February 2022) (Principal Reasons).

This Ruling concerns the costs of the application.

The plaintiffs submitted that the parties’ costs of the plaintiffs’ application should be costs in the proceeding for these reasons:

(a)They have succeeded in their application for a Group Costs Order. In describing their success they said that “the contradictor, who opposed the application, was unsuccessful”, and while the defendant did not formally indicate a position on the application, it was heard on the application and made submissions in opposition to the arguments advanced by the plaintiffs.
(b)However, the outcome of the application should not determine the appropriate costs order (from which submission I infer that the outcome of the application should, however, inform the appropriate costs disposition). In respect of this application, which was interlocutory, the Court is not in a position to know where the justice lies between the parties in respect of the Group Costs Order.[2] The result is that the parties’ costs of the GCO application should be costs in the proceeding which will have the effect that those costs will follow the event.
[2]See Dale v Clayton Utz(No 3) [2013] VSC 593, [13] (Dale); Setka v Abbott (No 2) [2013] VSCA…

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.

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Details

Case: [2022] VSC 302
Decision Date: 6 June 2022 (on the papers)

CaseChat Overview and Summary

The case of Allen v G8 Education Ltd (No 3) involved a legal dispute concerning the costs associated with a group proceeding. The plaintiff sought a Group Costs Order under section 33ZDA of the Supreme Court Act 1986. The defendant, G8 Education Ltd, was largely neutral in the proceedings but made limited submissions regarding the costs. The court had to decide on the appropriate allocation of costs between the parties, considering the indemnity principle and fairness in light of the defendant's neutral stance.

The central legal issue was the identification of the "event" which the costs should follow. The court examined whether the defendant's limited engagement in the proceedings justified any deviation from the usual indemnity principle, which typically requires the losing party to pay the winner's costs. Fairness and the defendant's neutral submissions played a significant role in the court's deliberation. The court also had to determine whether the plaintiff should bear their own costs while reserving the defendant's costs pending further developments.

In its reasoning, the court emphasised the importance of fairness in allocating costs. It found that despite the defendant's neutrality, the plaintiff was still responsible for their own costs. The court also reserved the decision on the defendant's costs, indicating that further consideration would be necessary. This approach balanced the need for a fair outcome with the procedural considerations of the group proceeding.

The final orders of the court directed that the plaintiff would bear their own costs, while the defendant's costs were reserved pending further orders. This decision reflected the court's careful consideration of the indemnity principle and the need for fairness in the context of a group proceeding.

Orders