APD Technology Pty Ltd v Maximo Developments Pty Ltd (No 2)

Case [2021] FCA 858

FEDERAL COURT OF AUSTRALIA

APD Technology Pty Ltd v Maximo Developments Pty Ltd (No 2)

[2021] FCA 858

File number: NSD 2003 of 2018
Judge: STEWART J
Date of judgment: 27 July 2021
Catchwords: COSTS – whether successful party entitled to indemnity costs under r 25.14 of the Federal Court Rules 2011 (Cth) – whether security for costs should be released to costs creditors prior to quantification – whether costs order should be stayed pending appeal
Legislation: Federal Court Rules 2011 (Cth) rr 25.14, 40.12, 40.43
Cases cited:

APD Technology Pty Ltd v Maximo Developments Pty Ltd [2021] FCA 678

Royal v Nazloomian, in the matter of Royal [2019] FCA 555

Scott v Charitopoulos [2008] FCA 1914; 174 FCR 9
Date of hearing: Determined on the papers
Date of last submissions: 22 July 2021
Registry: New South Wales
Division General Division
National Practice Area: Commercial and Corporations
Sub-area:  Commercial Contracts, Banking, Finance and Insurance
Number of paragraphs: 19
Counsel for the Applicant: D E Grieve QC
Solicitor for the Applicant: RBHM Commercial Lawyers
Counsel for the First to Third Respondents and First to Third Cross-Claimants: D A Lloyd SC and L M Johnston
Solicitor for the First to Third Respondents and First to Third Cross-Claimants: Cochrane Leahy Litigation Pty Ltd
Counsel for the Fourth Respondent: A K Flecknoe-Brown
Solicitor for the Fourth Respondent: Barry.Nilsson. Lawyers
Solicitor for the Cross-Respondent: Clyde & Co

ORDERS

NSD 2003 of 2018
BETWEEN:

APD TECHNOLOGY PTY LTD (ACN 100 568 232)

Applicant
AND:

MAXIMO DEVELOPMENTS PTY LTD ACN 102 362 907 T/AS CENTURY 21 CENTRAL GC (ABN 18 655 110 086)

First Respondent

SASAN RAHMANI

Second Respondent

RITA RAHMANI (and another named in the Schedule)

Third Respondent
AND BETWEEN:

MAXIMO DEVELOPMENTS PTY LTD ACN 102 362 907 T/AS CENTURY 21 CENTRAL GC (ABN 18 655 110 086) (and others named in the Schedule)

First Cross-Claimant
AND:

HAMILTON UNDERWRITING LTD FOR AND ON BEHALF OF SYNDICATE 3334

Cross-Respondent

JUDGE:

STEWART J

DATE OF ORDER:

27 JULY 2021

THE COURT ORDERS THAT:

1.The applicant pay the first, second and third respondents’ costs on a party and party basis up until 11:00 am on 13 March 2020 and on an indemnity basis thereafter.

2.The applicant pay the fourth respondent’s costs of the proceeding.

3.The cross-respondent to the first, second and third cross-claimants’ cross-claim pay the cross-claimants’ costs of the cross-claim on a party and party basis up until 11:00 am on 13 March 2020 and on an indemnity basis thereafter.

4.The cross-respondent to the first, second and third cross-claimants’ cross-claim indemnify the cross-claimants for their defence costs under the policy of insurance in defending the proceeding brought by the applicant against the cross-claimants.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

STEWART J:

Introduction

  1. This judgment is on costs and the relief on the cross-claim following my judgment and publication of reasons in APD Technology Pty Ltd v Maximo Developments Pty Ltd [2021] FCA 678

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AGLC
APD Technology Pty Ltd v Maximo Developments Pty Ltd (No 2) [2021] FCA 858
Case
[2021] FCA 858
Decision Date

CaseChat Overview and Summary

The matter under consideration was APD Technology Pty Ltd v Maximo Developments Pty Ltd (No 2). The dispute centred on whether the successful party was entitled to indemnity costs under rule 25.14 of the Federal Court Rules 2011 (Cth). Additionally, the court had to decide if security for costs should be released to costs creditors prior to quantification and whether the costs order should be stayed pending appeal. The case involved several parties, including cross-claimants and a cross-respondent, with multiple claims and cross-claims at stake.

The primary legal issue was whether the successful party, APD, was entitled to indemnity costs under the relevant rules of the Federal Court. This involved determining whether the conditions for such costs were met, including the assessment of the proportionality and necessity of the costs incurred. Another significant issue was the timing and conditions under which security for costs should be released to creditors. The court also needed to decide whether the costs order should be stayed pending appeal, which would affect the immediate financial obligations of the parties involved.

The court concluded that it was premature to order the payment of security for costs to APD because the costs had not yet been quantified. As a result, the court found no basis for the relief sought by APD at that stage. The court also determined that there was no reason to stay the order for costs, which would involve quantifying the costs as its next step. Therefore, the application by APD was dismissed. The court reasoned that since the costs had not been quantified, there was no imminent payment that necessitated the immediate release of security for costs. Consequently, the court made orders in accordance with the reasons provided.

In summary, the court ordered that the applicant pay the first, second, and third respondents’ costs on a party and party basis up until a specific time and on an indemnity basis thereafter. The applicant was also ordered to pay the fourth respondent’s costs of the proceeding. Additionally, the cross-respondent to the first, second, and third cross-claimants’ cross-claim was directed to pay the cross-claimants’ costs of the cross-claim on a party and party basis up until the specified time and on an indemnity basis thereafter. Finally, the cross-respondent was to indemnify the cross-claimants for their defence costs under the policy of insurance in defending the proceeding brought by the applicant against the cross-claimants.

Orders

Orders of the court

1. The applicant pay the first, second and third respondents’ costs on a party and party basis up until 11:00 am on 13 March 2020 and on an indemnity basis thereafter.

2. The applicant pay the fourth respondent’s costs of the proceeding.

3. The cross-respondent to the first, second and third cross-claimants’ cross-claim pay the cross-claimants’ costs of the cross-claim on a party and party basis up until 11:00 am on 13 March 2020 and on an indemnity basis thereafter.

4. The cross-respondent to the first, second and third cross-claimants’ cross-claim indemnify the cross-claimants for their defence costs under the policy of insurance in defending the proceeding brought by the applicant against the cross-claimants.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

Given my conclusion that it is premature at this stage to order that the security for costs be paid to APD because the costs have not yet been quantified, it is also premature to deal with the relief sought by APD – since the costs have not yet been quantified there is no payment that is imminent and therefore there is no basis to the relief that is sought. There is certainly no reason why the order for costs, which will entail as its next step the quantification of costs, should be stayed at this stage. I therefore dismiss APD’s application.Conclusion I will make orders in accordance with the above reasons.

Ratio Decidendi

Legal Principle Established

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