Ann Street Mezzanine Pty Ltd v Beck
[2011] FCA 1328
•18 November 2011
FEDERAL COURT OF AUSTRALIA
Ann Street Mezzanine Pty Ltd v Beck [2011] FCA 1328
Citation: Ann Street Mezzanine Pty Ltd v Beck [2011] FCA 1328 Parties: ANN STREET MEZZANINE PTY LTD (IN LIQUIDATION) (ACN 102 854 866) v CEDRIC RICHARD PALMER BECK & ORS (ACCORDING TO ATTACHED SCHEDULE); NORMAN PHILLIP CAREY & ORS (ACCORDING TO ATTACHED SCHEDULE); FREEHILLS and AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION File number: VID 485 of 2008 Judge: KENNY J Date of judgment: 18 November 2011 Catchwords: PRACTICE AND PROCEDURE – application to set aside a subpoena – interlocutory application refused – costs – whether applicant’s costs of application should be borne by issuing party – Rule 24.22 of the Federal Court Rules 2011 inapplicable in the present case – no justification to depart from usual rule as to costs – applicant to pay respondent’s costs Legislation: Federal Court of Australia Act 1976 (Cth)
Federal Court Rules 2011 (Cth)Cases cited: A Pty Ltd v Z [2007] NSWSC 999
Darcey v Pre-Term Foundation Clinic [1983] 2 NSWLR 497
R v Barbaro (1992) 108 ACTR 1
Re Bauhaus Pyrmont Pty Ltd (in liq) (2006) 67 NSWLR 289
Ann Street Mezzanine Pty Ltd v Beck [2011] FCA 1304Date of submissions: 15 & 16 November 2011 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 7 Solicitor for Simon Andrew Read: Clayton Utz Counsel for the First Cross-Respondent: DA Klempfner Solicitor for the First Cross-Respondent: Monahan + Rowell
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
VID 485 of 2008
BETWEEN:
AND:
ANN STREET MEZZANINE PTY LTD (IN LIQUIDATION) (ACN 102 854 866)
PlaintiffCEDRIC RICHARD PALMER BECK & ORS (ACCORDING TO ATTACHED SCHEDULE)
DefendantsNORMAN PHILLIP CAREY & ORS (ACCORDING TO ATTACHED SCHEDULE)
Cross-ClaimantsFREEHILLS
First Cross-RespondentAUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION
Second Cross-Respondent
JUDGE:
KENNY J
DATE OF ORDER:
18 NOVEMBER 2011
WHERE MADE:
MELBOURNE
THE COURT ORDERS THAT:
1.Simon Andrew Read pay Freehills’ costs of and incidental to the interlocutory application to set aside the subpoena issued to Mr Read at the request of Freehills, which was filed on 11 November 2011.
Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION
VID 485 of 2008
BETWEEN:
AND:
ANN STREET MEZZANINE PTY LTD (IN LIQUIDATION) (ACN 102 854 866)
PlaintiffCEDRIC RICHARD PALMER BECK & ORS (ACCORDING TO ATTACHED SCHEDULE)
DefendantsNORMAN PHILLIP CAREY & ORS (ACCORDING TO ATTACHED SCHEDULE)
Cross-ClaimantsFREEHILLS
First Cross-RespondentAUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION
Second Cross-Respondent
JUDGE:
KENNY J
DATE:
18 NOVEMBER 2011
PLACE:
MELBOURNE
REASONS FOR JUDGMENT
By an interlocutory application filed on 11 November 2011, Simon Andrew Read unsuccessfully applied to set aside a subpoena issued to him at the request of Freehills.
On 15 November 2011, after delivery of interlocutory judgment refusing the application, Freehills sought its costs of and incidental to Mr Read’s interlocutory application. Mr Read has since sought an order that Freehills pay his costs.
Although s 43 of the Federal Court of Australia Act 1976 (Cth) confers a broad discretion on this Court with respect to costs, the exercise of the discretion is guided by settled principles. Generally, the discretion is exercised in favour of the successful party. Freehills submitted that there were no circumstances of an appropriate kind to justify a departure from the usual rule.
In support of Mr Read’s costs application, by letter dated 15 November 2011, Mr Read’s solicitors referred me to A Pty Ltd v Z [2007] NSWSC 999 (“A Pty Ltd v Z”), Darcey v Pre-Term Foundation Clinic [1983] 2 NSWLR 497, R v Barbaro (1992) 108 ACTR 1, and Re Bauhaus Pyrmont Pty Ltd (in liq) (2006) 67 NSWLR 289. None of these authorities support an award of costs in favour of Mr Read as opposed to Freehills in this case. In the same letter, Mr Read’s solicitors relied on numerous factors as supporting a costs award in favour of Mr Read, including the propriety of Mr Read’s conduct with respect to his application, the rule with respect to expert witnesses (as to which, see Ann Street Mezzanine Pty Ltd v Beck [2011] FCA 1304 at [9]), and that one of a number of factors bearing on the Court’s decision had not been drawn to Mr Read’s attention prior to the hearing. Furthermore, Mr Read’s solicitors asserted that, with respect to a subpoena, “[a]s a general rule, a party who causes a subpoena to be issued is ordinarily required to pay any legal expenses reasonably incurred by the recipient of the subpoena”.
The last-mentioned proposition is a reference to a power, which in this Court, is the subject of Rule 24.22 of the Federal Court Rules 2011 (Cth) (“the Rules”). In relation to subpoenas, pursuant to Rule 24.22(1) of the Rules, the Court has power to order the issuing party to pay an amount of any reasonable loss or expense incurred in complying with the subpoena. If an order is made under Rule 24.22(1), the Court must fix the amount or direct that it be fixed in accordance with the Court’s usual procedure in relation to costs: Rule 24.22(2). An amount fixed under Rule 24.22 is separate from and in addition to conduct money paid to the addressee and witness expenses payable to the addressee: Rule 24.22(3). Costs incurred in respect of an application to set aside a subpoena are not, however, fairly described as loss or expense incurred in complying with the subpoena: compare A Pty Ltd v Z at [48]-[49]. Rule 24.22 does not assist Mr Read with respect to the current costs issue.
Further, none of the other considerations mentioned by Mr Read warrant departure from the usual rule as to costs. No question of litigation propriety arises. The operation of the so-called expert witness rule has already been considered. So too have the factors relevant to its operation, and nothing pertaining to them leads me to conclude that Freehills should not have the costs of Mr Read’s interlocutory application. Freehills has reiterated that it will pay Mr Read’s reasonable expenses of preparing for and attending at trial in accordance with the general principles applying to costs of a subpoenaed person.
Accordingly, I would order that Mr Read pay Freehills’ costs of and incidental to Mr Read’s interlocutory application filed 11 November 2011.
I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kenny. Associate:
Dated: 18 November 2011
SCHEDULE OF PARTIES
ANN STREET MEZZANINE PTY LTD ( IN LIQUIDATION) (ACN 102 854 866) Plaintiff CEDRIC RICHARD PALMER BECK First Defendant JOHN NORMAN DIXON Second Defendant GRAEME JOHN RUNDLE Third Defendant NORMAN PHILLIP CAREY Fourth Defendant LYNETTE ROCHELLE SCHIFTAN Fifth Defendant NEEDLERS END NOMINEES PTY LTD (ACN 008 828 324) Sixth Defendant KEBBEL CAPITAL PTY LTD (ACN 106 196 481) Seventh Defendant
PALENTIA PTY LTD (ACN 099 289 326) Eighth Defendant
NORMAN PHILLIP CAREY First Cross-Claimant QUARTZ NOMINEES PTY LTD (ACN 008 859 103)
Second Cross-claimant HECA NOMINEES PTY LTD (ACN 053 581 874) Third Cross-claimant ACEBID PTY LTD (ACN 074 566 046) Fourth Cross-claimant ANDRIANNI PTY LTD (ACN 005 458 720) ATF THE ANDRIANNI TRUST Fifth Cross-claimant ANN STREET BRISBANE PTY LTD (ACN 101 943 711) ATF THE ANN STREET BRISBANE TRUST Sixth Cross-claimant BENNALONG HOLDINGS PTY LTD (ACN 008 741 008) Seventh Cross-claimant DOSIUS PTY LTD (ACN 009 449 450)
Eighth Cross-claimant EARLMIST PTY LTD (RECEIVER & MANAGER APPOINTED) (CONTROLLER APPOINTED) (ACN 069 056 926) ATF THE EARLMIST UNIT TRUST Ninth Cross-claimant
ETNAS PTY LTD (ACN 056 599 350) ATF THE ENTAS TRUST Tenth Cross-claimant HEALTHCARE PROPERTIES PTY LTD (ACN 074 501 955) ATF THE HEALTHCARE PROPERTIES TRUST Eleventh Cross-claimant HUNTINGDALE VILLAGE PTY LTD (RECEIVER & MANAGER APPOINTED) (ACN 085 048 531) ATF THE HUNTINGDALE VILLAGE UNIT TRUST Twelfth Cross-claimant JEVWOOD PTY LTD (ACN 074 525 321) Thirteenth Cross-claimant K.I.S. REALTY PTY LTD (ACN 100 871 314) Fourteenth Cross-claimant KEEP IT SIMPLE INVESTMENTS (GLOBAL) PTY LTD (ACN 100 871 270) Fifteenth Cross-claimant NORTH SYDNEY DEVELOPMENT PTY LTD (CONTROLLER APPOINTED) (ACN 107 037 838) ATF THE NORTH SYDNEY DEVELOPMENT TRUST Sixteenth Cross-claimant PAQUERO PTY LTD (ACN 003 530 556) Seventeenth Cross-claimant PARAGON APARTMENTS LTD (RECEIVER & MANAGER APPOINTED) (ACN 087 200 413) Eighteenth Cross-claimant RENAISSANCE MEZZANINE PTY LTD (ACN 110 978 491)
Nineteenth Cross-claimant ROMPRIDE PTY LTD (ACN 074 524 824) ATF THE ERLEY UNIT TRUST Twentieth Cross-claimant SCOTS CHURCH DEVELOPMENT LTD (RECEIVER & MANAGER APPOINTED) (ACN 091 686 323) Twenty-first Cross-claimant
SILKCHIME PTY LTD (RECEIVER & MANAGER APPOINTED) (ACN 066 849 429) ATF THE SILKCHIME UNIT TRUST Twenty-second Cross-claimant
VANNIN PTY LTD (RECEIVER & MANAGER APPOINTED) (ACN 067 610 271) ATF THE HAY FAMILY TRUST Twenty-third Cross-claimant
WARWICK ENTERTAINMENT CENTRE PTY LTD (RECEIVER & MANAGER APPOINTED) (ACN 054 246 918) ATF THE WARWICK ENTERTAINMENT CENTRE UNIT TRUST Twenty-forth Cross-claimant
WESTPOINT FINANCIAL SERVICES PTY LTD (ACN 074 148 324) Twenty-fifth Cross-claimant
WESTPOINT MANAGEMENT (CENTREWAYS) PTY LTD (ACN 082 349 068) ATF THE CENTREWAYS REFURBISHMENT SYNDICATION TRUST Twenty-sixth Cross-claimant
FREEHILLS First Cross-respondent AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION Second Cross-respondent COMMONWEALTH OF AUSTRALIA Third Cross-respondent
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