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Apostolidis v Kalenik (No 2)

Apostolidis v Kalenik (No 2)

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Case Copied 28 October 2011 38 min read

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SUPREME COURT OF VICTORIA

COURT OF APPEAL

S APCI 2009 3882
IOANNIS (JOHN) APOSTOLIDIS	First Applicant/Appellant
DSK HOLDINGS PTY LTD (ACN 007 416 257)	Second Applicant/Appellant
AZURA PTY LTD (ACN 063 939 720)	Third Applicant/Appellant
YARRABEE INVESTMENTS PTY LTD (ACN 093 518 275)	Fourth Applicant/Appellant
v
ZORICA KALENIK	First Respondent
and
DEPUTY COMMISSIONER OF TAXATION (No 2)	Second Respondent
AND BETWEEN:
ZORICA KALENIK	Cross-Appellant
v
IOANNIS (JOHN) APOSTOLIDIS	First Cross-Respondent
DSK HOLDINGS PTY LTD (ACN 007 416 257)	Second Cross-Respondent
AZURA PTY LTD (ACN 063 939 720)	Third Cross-Respondent
YARRABEE INVESTMENTS PTY LTD (ACN 093 518 275)	Fourth Cross-Respondent
and
DEPUTY COMMISSIONER OF TAXATION (No 2)	Fifth Cross-Respondent

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JUDGES	NETTLE, ASHLEY and TATE JJA
WHERE HELD	MELBOURNE
DATE OF HEARING	13 October 2011
DATE OF JUDGMENT	28 October 2011
MEDIUM NEUTRAL CITATION	[2011] VSCA 329
JUDGMENTS APPEALED FROM	[2009] VSC 208; [2009] VSC 475 (Hargrave J)

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COSTS – Adjustment order under Part IX of the Property Law Act 1958 – Misconduct by both parties pre-trial and at trial – Respondent successful but lost on significant factual issues –Judge awarded respondent costs of pre-trial and 75 per cent of costs of trial – Whether exercise of costs discretion should be disturbed – Whether costs orders proportionate to success should usually apply to adjustment order proceedings – Baker v Towle (2008) 39 Fam LR 323, explained – Whether respondent achieved ‘substantial success’ – Whether respondent’s refusal of Calderbank offer unreasonable – Whether judge should have inspected respondent’s offer of compromise – Supreme Court (General Civil Procedure) Rules 2005, r 26.05(2) – Application for leave to appeal against costs orders refused.

COSTS – Costs of appeal and of cross-appeal – Each party successful – No order for costs.

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Appearances:	Counsel	Solicitors
For the Applicants/Appellants/ Cross-Respondents (First to Fourth)	Mr S K Wilson QC with Mr P G Little	David Tonkin & Associates
For the First Respondent/ Cross-Appellant	Mr P H Solomon SC with Ms M Wilkening-Le Brun	Dimos Lawyers
For the Second Respondent/ Fifth Cross-Respondent	Mr S A Linden	Australian Government Solicitor

NETTLE JA
ASHLEY JA
TATE JA:

Introduction

On 13 October 2011, this Court made orders allowing an appeal brought by the appellant, Ioannis Apostolidis (‘A’), against the respondent, Zorica Kalenik (‘K’), and allowing a cross-appeal by K against A.[1] The orders included the setting aside of the principal judgment below. We now consider the question of whether the costs ordered by the trial judge ought be disturbed and what costs ought be awarded in the appeal and cross-appeal. We also consider the question of whether the monies paid into court by A should be released to K.
[1]Apostolidis v Kalenik [2011] VSCA 307.

The appeal had been brought from three judgments given in the Common Law Division. The principal judgment determined the amount to be paid by A to K pursuant to Part IX of the Property Law Act 1958 (‘PLA’), by way of an adjustment of interests in relation to the…

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: [2011] VSCA 329
Decision Date: 28 October 2011

CaseChat Overview and Summary

The parties in the matter were Apostolidis and Kalenik, with the dispute primarily centred on an adjustment order under Part IX of the Property Law Act 1958. The case was heard in the Supreme Court of Victoria. The central issue before the court was the appropriate exercise of the discretion to award costs in the context of adjustment order proceedings, especially when both parties engaged in conduct deemed to be less than exemplary. The court was tasked with determining whether the costs awarded by the trial judge were proportionate to the respective successes of the parties, and if the refusal of a Calderbank offer was reasonable.

The court meticulously reviewed the conduct of both parties, noting significant misconduct both before and during the trial. Despite this, the respondent emerged victorious on substantial factual issues. The trial judge had awarded the respondent the costs associated with pre-trial proceedings and 75 per cent of the trial costs. The court found that the trial judge's exercise of discretion was sound, and the costs awarded were proportionate to the respondent’s success. The court further considered the principle that costs orders should usually align with the extent of the party's success, referencing the decision in Baker v Towle. The court also found that the refusal of the Calderbank offer was not unreasonable, and that the trial judge was not obligated to inspect the respondent’s offer of compromise as per the Supreme Court (General Civil Procedure) Rules 2005, r 26.05(2).

Ultimately, the court held that the trial judge's discretion in awarding costs was not an abuse and should not be disturbed. Additionally, the court dismissed the application for leave to appeal against the costs orders. In relation to the costs of the appeal and cross-appeal, as both parties achieved some success, no order for costs was made. The final orders affirmed the costs orders made by the trial judge and dismissed the application for leave to appeal.

Orders