Anna Carr as administratrix of the estate of Giuseppe Larussa v Larussa Pastoral Holdings Pty Ltd as former trustee of the Larussa Pastoral Trust [No 2]

[2020] WASC 77

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CIVIL

CITATION:   ANNA CARR as administratrix of the estate of GIUSEPPE LARUSSA -v- LARUSSA PASTORAL HOLDINGS PTY LTD as former trustee of THE LARUSSA PASTORAL TRUST [No 2] [2020] WASC 77

CORAM:   CURTHOYS J

HEARD:   23 DECEMBER 2019

DELIVERED          :   10 MARCH 2020

FILE NO/S:   CIV 2162 of 2016

BETWEEN:   ANNA CARR as administratrix of the estate of GIUSEPPE LARUSSA

Plaintiff

AND

LARUSSA PASTORAL HOLDINGS PTY LTD as former trustee of THE LARUSSA PASTORAL TRUST

First Defendant

LARUSSA CUSTODIAN SERVICES AUSTRALIA PTY LTD as trustee of THE LARUSSA PASTORAL TRUST

Second Defendant

TONY LARUSSA

Third Defendant

Catchwords:

Costs - Set-off - Different actions

Legislation:

Criminal Property Confiscation Act 2000 (WA)

Result:

Plaintiff to pay defendants' costs, otherwise adjourned

Representation:

Counsel:

Plaintiff	:	Mr S M Standing
First Defendant	:	Mr C G Juebner
Second Defendant	:	Mr C G Juebner
Third Defendant	:	Mr S K Wilson QC with him Mr B J Murphy

Solicitors:

Plaintiff	:	Friedman Lurie Singh & D'Angelo
First Defendant	:	Corporate Counsel Lawyers
Second Defendant	:	Corporate Counsel Lawyers
Third Defendant	:	Garde-Wilson Lawyers

Case(s) referred to in decision(s):

Aristocrat Technologies Australia Pty Ltd v Allam [2017] FCA 812

Larussa v Carr [2016] WASC 332

Miller v Director of Public Prosecutions (No 2) [2004] NSWCA 249

CURTHOYS J:

1. This decision relates to the appropriate costs orders arising from the primary decision in this matter.

2. The plaintiff was unsuccessful.  She accepts that she should pay the parties' costs.  She seeks a set-off in relation to the costs of the third defendant as a result of costs to which she is entitled in other proceedings in which she was successful:  CIV 1702 of 2015.

3. No set-off is sought against the first and second defendants.

4. The legal principles relating to a set-off of costs between parties in different actions are set out in his judgment of Perram J in Aristocrat Technologies Australia Pty Ltd v Allam [2017] FCA 812:

   11.As to the right to set off one costs judgment against another, the following propositions are relevant to this case.  First, at least in Australia it now appears to be settled that the jurisdiction being exercised neither arises from statutory nor equitable origins but is instead an exercise of the Court's inherent jurisdiction over its own suitors: see Wentworth v Wentworth (Unreported, Supreme Court of New South Wales, Young J, 12 December 1994) at 3-4 ('Wentworth'); Australian Beverage Distributors v Evans & Tate Premium Wines Pty Ltd [2006] NSWSC 560; (2006) 200 FLR 332 ('Australian Beverage Distributors') at 347; [68]-[70] per White J; Sivritas v Sivritas [2008] VSC 374; (2008) 23 VR 349 at 390 [22] per Kyrou J; Team Dynamik Racing Pty Ltd v Longhurst Racing Pty Ltd [2008] QSC 36 at p 9 per Fryberg J; Lahoud v Lahoud [2012] NSWSC 284 ('Lahoud') at [72]-[79] per Ward J. Australian Beverage Distributors was referred to by the New South Wales Court of Appeal as authority for this proposition without disapproval, although the Court's statement was not critical to the conclusion in the case: State of New South Wales v Hamad [2011] NSWCA 376 at [35]-[37] per Giles JA (Beazley and Whealy JJA agreeing). I proceed on the largely settled basis that the jurisdiction being exercised is inherent.

   12.Secondly, the set-off is available even where, as here, what is sought to be set off is an unliquidated costs order (i.e. Aristocrat's as yet untaxed costs against Mr Allam) against a liquidated costs judgment (i.e. Mr Allam's and Tonita's rights under the High Court's costs certificate against Aristocrat): see Lahoud at [82].

   13.Thirdly, the power to order a set-off of costs is certainly discretionary whether the jurisdiction is, as it appears to be, inherent or even if, less likely, it is equitable in nature. Regardless of where individual authorities have ended up on the source of the jurisdiction, they speak with one voice for the proposition that a discretion is involved in its exercise: see, for example in the United Kingdom, Currie; Lockley v National Blood Transfusion Service [1992] 1 WLR 492 ('Lockley') at 497 per Scott LJ; Brookes v Harris [1995] 1 WLR 918 at 925 per Ferris J. In Australia, the discretion is to be exercised 'according to what is equitable in the particular circumstances': Miller v Director of Public Prosecutions (No. 2) [2004] NSWCA 249 ('Miller') at [27] per Young CJ in Eq. And, at least where costs are sought to be set off against costs, this is likely to involve the same kinds of considerations as those which apply under the Court's general discretion to award costs. This may be what Scott LJ said in Lockley at 497. Certainly, that is how Ward J read Lockley in Lahoud and I am inclined to agree with her Honour's parsing of this passage. But even if that is not precisely what Scott LJ said (and one must admit a degree of ambiguity in his Lordship's otherwise limpid prose), it is difficult to see why the discretionary inputs into the question of a costs set-off should differ from those which apply to costs generally. Without becoming enmeshed in the theological niceties of the nature of the discretion, there is much to be said, with respect, for the views of Beazley JA in Miller at [13], who said that the discretion is a broad one under which a variety of factors may be taken into account, including 'the public interest, the efficient administration of justice, and the conduct of the parties'.

   14.Fourthly, the jurisdiction to set off costs awards extends to costs awarded in different proceedings (as here, where one set of costs orders is in one court and one set is in another): Miller at [23] per Young CJ in Eq referring to his Honour's own judgment in Wentworth. It also permits, in an appropriate case, set-off between different parties. Authority for this proposition is scarcer. Young CJ in Eq thought the proposition to be correct in Miller (at [24]) and Fryberg J exercised just such a jurisdiction in Team Dynamik Racing Pty Ltd v Longhurst Racing Pty Ltd [2008] QSC 36 at pp 9-10. In Flinn v Flinn [1999] VSCA 109; [1999] 3 VR 712 at 761 the Victorian Court of Appeal achieved a similar outcome. From a theoretical perspective, it seems to me, as indeed it seemed to Fryberg J, that the jurisdiction is similar to the jurisdiction of a court to order costs against a third party. As indicated above, the principles governing the exercise of the discretion to order a set-off are analogous to those governing the costs discretion itself. If so, there is no reason to think that, in an appropriate case, the Court might not order a set-off even though there was no precise identity of the parties. Further, there is no reason to think that the Court could not, for the purposes of achieving a just set-off, notionally apportion a jointly held right.

1. In CIV 1702 of 2015 Tony Larussa sought proof in solemn form of his father's will.  Justice Chaney found that the father's will had been revoked (see Larussa v Carr [2016] WASC 332). The court ordered that the plaintiff in that action (Tony Larussa) pay the defendants' costs (Anna Carr and others) (Affidavit of Darren Singh DS1). Those costs have been taxed (see DS2).

2. The nature of Anna Carr's proceedings in this action, which alleged undue influence and unconscionable conduct are plainly very different.  Although there were some common factual issues, this is not a case where the two separate sets of proceedings are based on the same factual matrix (see for example Miller v Director of Public Prosecutions (No 2) [2004] NSWCA 249 at [25] per Young CJ in Equity). I have reservations as to whether a set-off is appropriate when there is a different factual matrix between the two cases.

3. I have had regard to Anna Carr's difficulties in recovering costs pursuant to the order of Chaney J.  However, the fact that a party has difficulty in recovering costs cannot of itself justify a set-off.  It is a factor to be considered in whether a set-off should be ordered.

4. A bankruptcy notice has been issued by Anna Carr.  However, whether Tony Larussa is bankrupt or not has not been determined.  This is because of the issue of a freezing notice against him under the Criminal Property Confiscation Act on 19 August 2017.  That remains unresolved.

5. Tony Larussa has submitted that no set-off can be ordered pending the resolution of the freezing notice.

6. In my opinion Tony Larussa's costs should be taxed.  However, payment of those costs by Anna Carr should be stayed pending the resolution of the Criminal Property Confiscation Act 2000 (WA).

7. If Tony Larussa's assets are confiscated he will effectively be bankrupt.  This will have a significant effect on whether a set-off should be ordered.

8. In her minute of orders Anna Carr has sought orders in relation to her costs in other proceedings.  It is for the plaintiff to pursue those costs if she wishes.  I am not prepared to make orders directing her to do so.  The minute also seeks orders in relation to the defendants' taxation of costs.  The defendants' bill of costs in this action should progress in the normal manner.  It is not necessary to make orders requiring them to file a bill within any particular period.

9. The question of a set-off can be determined once those proceedings are finally resolved.

Orders

1. The plaintiff do pay the first and second defendants' costs of these proceedings to be taxed as one bill.

2. The plaintiff do pay the third defendants costs of these proceedings to be taxed.

3. The payment of the third defendants' costs by the plaintiff in these proceedings be stayed until further order of this Court.

4. There be liberty to apply.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

MDM

Associate to the Honourable Justice Curthoys

9 MARCH 2020