Astral Land Pty Ltd v Golden Commercial Pty Ltd
[2012] WASC 274 (S)
ASTRAL LAND PTY LTD -v- GOLDEN COMMERCIAL PTY LTD [2012] WASC 274 (S)
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2012] WASC 274 (S) | |
| Case No: | CIV:2239/2011 | 7 NOVEMBER 2012 | |
| Coram: | KENNETH MARTIN J | 18/01/13 | |
| 13 | Judgment Part: | 1 of 1 | |
| Result: | Modified costs orders | ||
| B | |||
| PDF Version |
| Parties: | ASTRAL LAND PTY LTD GOLDEN COMMERCIAL PTY LTD LUAN MAY WONG LAKEBRIDGE HOLDINGS PTY LTD |
Catchwords: | Costs Special costs orders Costs thrown away Amendments Pleading issues |
Legislation: | Legal Practitioners (Supreme Court) (Contentious Business) Determination 2010 (WA) Rules of the Supreme Court 1971 (WA), O 66 r 3 |
Case References: | Astral Land Pty Ltd v Golden Commercial Pty Ltd [2012] WASC 274 Barclay Mowlem Construction Ltd v Dampier Port Authority [2006] WASC 281; (2006) 33 WAR 82 Major v Woodside Energy Ltd [No 3] [2009] WASC 246 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
GOLDEN COMMERCIAL PTY LTD
First Defendant
LUAN MAY WONG
Second Defendant
LAKEBRIDGE HOLDINGS PTY LTD
Third Defendant
Catchwords:
Costs - Special costs orders - Costs thrown away - Amendments - Pleading issues
Legislation:
Legal Practitioners (Supreme Court) (Contentious Business) Determination 2010 (WA)
Rules of the Supreme Court 1971 (WA), O 66 r 3
(Page 2)
Result:
Modified costs orders
Category: B
Representation:
Counsel:
Plaintiff : Mr S M Davies SC & Mr J D MacLaurin
First Defendant : Mr M L Bennett
Second Defendant : Mr M L Bennett
Third Defendant : Mr M L Bennett
Solicitors:
Plaintiff : DLA Piper Australia
First Defendant : Bennett & Co
Second Defendant : Bennett & Co
Third Defendant : Bennett & Co
Case(s) referred to in judgment(s):
Astral Land Pty Ltd v Golden Commercial Pty Ltd [2012] WASC 274
Barclay Mowlem Construction Ltd v Dampier Port Authority [2006] WASC 281; (2006) 33 WAR 82
Major v Woodside Energy Ltd [No 3] [2009] WASC 246
(Page 3)
1 KENNETH MARTIN J: A number of issues arise out of my reasons for decision delivered 31 July 2012 (Astral Land Pty Ltd v Golden Commercial Pty Ltd [2012] WASC 274), namely:
(a) Whether the costs associated with my determinations arising out of special appointments (heard 23 March and 14 June 2012) should 'lie in the cause of the action', in accord with the prima facie view I expressed at [64] - [66] in [2012] WASC 274. The defendants are content that costs be in the cause. However, the plaintiff (Astral), by its minute of 31 October 2012, contends that the defendants should pay the plaintiff's costs of the defendants' application for summary judgment and to strike out the statement of claim, including the special appointments on 23 March 2012 and 14 June 2012, to be taxed.
(b) What costs orders should be made as a consequence of order 5 in orders I made on 22 September 2011. The defendants have applied in respect of that order, and seek to have a taxation of their costs thrown away proceed before a Registrar of this court, with any taxed costs made payable forthwith and the scale limits otherwise applicable in a taxation - specifically items 10(a), 17, 24 and 33 in the Supreme Court Scale of Costs 2010, found within the Legal Practitioners (Supreme Court) (Contentious Business) Determination 2010 (WA) - be removed.
(c) The defendants seek special costs orders in respect of costs not already dealt with arising from the six iterations of the plaintiff's statement of claim. The first iteration was 3 August 2011. The most recent iteration, the plaintiff's 'Further Re-Amended Substituted Statement of Claim', is of 13 September 2012.
(d) Whether additional paragraphs of the plaintiff's most recent pleading should be struck out. At [59] - [62] of [2012] WASC 274, I explained why par 105(d) of the plaintiff's statement of claim would be struck out. In accord with those reasons, the plaintiff removed par 105(d) from the next iteration of its statement of claim. The defendants then filed submissions on 22 October 2012 in support of an application to strike out the balance of the plaintiff's plea of unconscionability, which is to be found in pars 105 and 106 of the plaintiff's most recent statement of claim. The plaintiff filed written submissions in opposition on 29 October 2012. However, when the matter came on for oral
- argument on 7 November 2012 the defendants did not press any further challenges to pars 105 and 106.
Issue (a): Reserved costs of 31 July 2012 - Astral's costs or costs in the cause?
2 The defendants are content with an order that costs of the two special appointments be in the cause, in accord with the prima facie view I expressed in [2012] WASC 274 [64] - [66]. However, the plaintiff disagrees and challenges that prima facie view. This was the subject of the plaintiff's written submissions of 31 October 2012.
3 The plaintiff accepts that 'costs in the cause' is the usual order, in circumstances where an application for summary judgment is not successful. However, the plaintiff says the defendants had raised numerous other complaints about its statements of claim in the context of the foreshadowed strike out applications, and none of these challenges were advanced by the defendants in the end, causing the plaintiff to incur unnecessary costs in the process.
4 To advance these costs arguments, the plaintiff sought to have me trawl through the defendants' lengthy earlier written submissions of 3 November 2011, 1 February 2012 and 19 March 2012 in order to show how much unnecessary work was required by it in respect of responding to multiple pleading objection points that in the end it says were subsequently not pursued, let alone upheld by the court.
5 The plaintiff also says that a lot of the complaints raised in the defendants' written submissions were 'nitpicking' and oppressive by volume, in the sheer scale of grievances they sought to ventilate. The plaintiff says the defendants' approach to their pleading was inconsistent with the contemporary approach to resolving pleading disputes, as discussed by Martin CJ in Barclay Mowlem Construction Ltd v Dampier Port Authority [2006] WASC 281; (2006) 33 WAR 82.
6 Having considered the plaintiff's written submissions, augmented by senior counsel's oral submissions on 7 November 2012, I remain of the view that, in all the circumstances, the appropriate order is that the relevant costs should be in the cause.
7 I particularly reject the plaintiff's entreaty to trawl through lengthy prior written submissions with a view to conducting some sort of audit upon past arguments once ventilated, but ultimately not determined. That proposal is wasteful and ultimately, untenable.
(Page 5)
8 The plaintiff filed a long and extremely complex first statement of claim on 3 August 2011. It has since taken until 13 September 2012 for a viable pleading to emerge, after six attempts. Coming to grips with various evolving unmarked iterations and minutes of a statement of claim has been a painful process for all concerned, including the court. From time to time the plaintiff's statement of claim has contained errors which have been diverting and frustrating (see [2012] WASC 274 [5]).
9 Properly and very understandably in my assessment, at two special appointments prior to my 31 July 2012 reasons, counsel for the defendants sought to focus on major asserted pleading deficiencies, particularly in regard to the plaintiff's attempted plea of unconscionability, and on a fatal result (for the plaintiff) delivered by various release clauses found in three deeds of 29 May 2008. I evaluated those core arguments in [2012] WASC 274.
10 On 23 March 2012 Astral narrowly evaded the defendants' attack. I gave it leave at the end of that day's argument to verify its action by affidavit, to defend the summary judgment application brought against it by two of the defendants. Problems subsequently emerged over an attempted verification by the plaintiff.
11 Ultimately, I excised what I assessed as an untenable par 105(d) of the statement of claim (see [2012] WASC 274 [59] - [62]).
12 Although the defendants ultimately did not succeed on their summary judgment application, brought by reference to the effect of releases in three deeds, that release issue still remains fully alive for trial. I have not expressed final views about the fate of those release arguments.
13 The plaintiff's present invitation to me to revisit voluminous conferral correspondence, written submissions or the like, leading up to two special appointments, so as to evaluate pleading grievances never argued, raises the intolerable, not to mention wasteful, prospect of asking the court to consider subsidiary grievances that in the end were outside the focus of the core arguments dealt with by each application. The insatiable resourcing demands of 21st century litigation now compel courts to strongly encourage parties to jettison their peripheral arguments and to focus upon the significant issues. That is what I ascertain the defendants to have done in this case. A sensible and modern-day approach to advocacy must be promoted, not punished.
(Page 6)
14 In my view, justice will be done here by an order for costs to lie in the ultimate cause of the action. The consequence will be that the side ultimately successful at trial would then receive its costs of these applications. Since there has obviously been a measure of success and failure on both sides upon these applications, that eventual costs resolution is the most appropriate.
15 Accordingly, I propose to order in terms:
The costs of the defendants' application for summary judgment; alternatively, to strike out, in part, the amended substituted statement of claim of 20 March 2012, including the costs of the special appointments on 23 March and 14 June 2012, shall be in the cause.
Issue (b): Costs thrown away as ordered in favour of the defendants on 22 September 2011
16 It is necessary to sketch out the procedural history to a greater extent before resolving this issue. Mr Lias Aripin is the defendant to Ms Luan (Mimi) Wong's defamation action CIV 1550 of 2011, commenced 30 March 2011 and managed in my CMC List.
17 The Golden Commercial action CIV 2239 of 2011 and the Wellington Parkland action CIV 2518 of 2011 have also been case managed in my CMC List, in conjunction with the earlier defamation action. The Golden Commercial action was commenced on 12 July 2011 and the Wellington Parkland action on 16 August 2011.
18 Astral Land Pty Ltd, the plaintiff in both CIV 2239 and CIV 2518 of 2011, is a corporation controlled by Mr Lias Aripin. Both actions have been commenced in retaliation against Ms Wong's defamation action, with a view to providing a sustainable basis for pleas of justification now seen in the defamation action. There has been little secret made of this motivation by counsel for Astral and Mr Lias Aripin. There are some serious contentions of fraud in Astral's pleadings made against Ms Wong and the defendant corporations associated with her under the tort of deceit, plus satellite causes of action said to arise out of the parties' previous investment dealings.
19 Allegations of fraud are serious and must be formulated clearly, coherently and with proper particulars. Much of the pleading contention to date between the parties arises from Astral and Mr Aripin seeking to raise an array of diverse asserted causes of action.
(Page 7)
20 On my assessment, the defendants then responded, understandably, by seeking to hold Astral to a proper and coherent pleading for what are very serious allegations.
21 On 1 September 2011, I made orders striking out the reference to fraud in par 45 of Astral's first statement of claim, on the basis the pleas were embarrassing, or an abuse of process. I allowed Astral until midday on 19 September 2011 to file an amended statement of claim. I listed the matter for further directions on 22 September 2011. I also awarded the defendants their costs of that directions hearing, which I fixed.
22 Thereafter, Astral did not comply with my direction concerning its filing of an amended statement of claim by 19 September 2011. There ensued a passing dialogue between the parties' respective solicitors over this. The defendants were insisting upon strict compliance. Astral was contending it needed more time. No order had been made extending Astral's 19 September 2011 pleading deadline, prior to its expiry.
23 When the matter returned to me on 22 September 2011, with the plaintiff then in default, I made orders allowing the plaintiff to apply for leave to join an additional party pursuant to Rules of the Supreme Court 1971 (WA), O 18 r 6, by 28 September 2011, and for the plaintiff to file and serve an amended writ of summons and statement of claim (with references to fraud removed, as I had ordered on 1 September 2011, but which had not then been complied with). I also made the order:
On the basis that the allegations of fraud in the plaintiff's writ of summons and statement of claim are marked out and shown as struck out and amended under order 2 hereof by reason of the Court's orders of 1 September 2011, the orders made on 1 September 2011 be and are hereby varied such that [Astral] shall now file and serve any minute of proposed re-amended writ of summons and minute of proposed re-amended statement of claim by 3 October 2011.
24 I re-listed the matter for further directions on 6 October 2011 in the CMC List. Concerning the present costs issue, I also ordered that
[t]he taxed costs of today's application be the defendants' in any event, and beyond that the plaintiff shall pay to the defendants their costs thrown away (if any) arising as a consequence of the plaintiff's failure to file and serve an amended writ of summons and amended statement of claim by 19 September 2011 (which costs are reserved and as to which the parties have liberty to apply).
(Page 8)
25 Pursuant to that liberty, the defendants now move for costs orders in terms of par 5 of a minute dated 24 October 2012. The order for costs thrown away having already been made on 22 September 2011, the defendants now seek:
(a) that they be at liberty to proceed with a taxation of a claim for costs thrown away arising out of the defaults of Astral, before a Registrar of this court;
(b) that it be ordered that any award of taxed costs ascertained under (a) be made payable forthwith; and
(c) allowance and scale limits be raised or removed in order to facilitate that taxation process.
26 I assess it as wholly appropriate that the relief as sought under (a) and (b) be granted. A more problematic question is whether it is appropriate, as sought by (c) above, that scale allowances be removed or raised?
27 A sub-issue arises here concerning a trip to Jakarta made by the defendants' legal advisors, in the period from 22 September 2011. The sub-issue is whether any legal costs have been wasted in relation to all or part of that trip. Astral does not accept there were wasted costs as a result of the Jakarta trip and the client meetings that took place. The defendants say their legal team departed for Jakarta on the morning of 22 September 2011, it being reasonable for them to expect they would then be in possession of Astral's amended statement of claim by reason of my orders of 1 September 2011, and also because a requested extension of time sought by Astral's legal advisors had been refused.
28 The defendants say (par 25 written submissions in relation to special costs dated 24 October 2012):
The trip was not confirmed until 19 September 2011. There was no reason, ahead of this time, to convey to solicitors for the plaintiff or the court that Bennett + Co were travelling to Jakarta.
29 As is apparent, I have already made the order awarding the defendants' costs thrown away (if any), arising out of the plaintiff's defaults by failing to serve an amended writ and an amended pleading by 19 September 2011. However, it is not possible or appropriate for me to determine at this point whether the defendants have or have not sustained any actual wasted legal costs by reason of Astral's default in complying with my directions and orders. On the face of it, the fact the defendants'
(Page 9)
- legal advisors travelled to Jakarta and there engaged in proofing sessions with representatives of the defendants to obtain instructions and prepare for the trial, would not of itself establish that any degree of wasted legal costs had necessarily been sustained in such an exercise. An award of legal costs 'thrown away' requires an identification of actual wasted legal costs proved as sustained by the party advancing the claim.
30 Nevertheless, the defendants only seek to have a future opportunity before a taxing officer of the court to prove that some wasted legal expenditure was sustained by the defendants by reason of the plaintiff's relevant defaults. They should be afforded that opportunity. A prospect of some wasted costs being sustained from these current circumstances does not present as wholly improbable. But it is a matter for evidence and proof. There should be the opportunity for the defendants to put proper materials before a taxing officer of this court to show the incurring of wholly wasted legal costs arising out of the defaults of Astral, as identified. In that process the defendants must surmount the requisite proof threshold. I express no present view about whether or not they will surmount that threshold.
31 As to the issue of allowances and scale limits being removed or varied for the defendants, I first observe that this is not a scenario of an award of indemnity costs to the defendants on a solicitor/client basis. Item 17 of the Supreme Court Scale of Costs 2010 (WA) sets the maximum allowance of 120 hours for a senior practitioner at an amount of $51,480. Any potential wasted getting up expenses ultimately proven by the defendants present as readily recoupable within that scale limit. There is nothing before me to indicate otherwise; likewise concerning any proven asserted wasted costs associated with conferral. Item 24(a) carrying a per hour allowance as to a potential quantum of hours does not require variation. Like considerations apply in respect of item 33 of the scale, if invoked.
32 Accordingly, I propose to order, pursuant to the liberty under order 5 of my orders of 22 September 2011, that the defendants, on their application for costs thrown away (if any), arising as a consequence of Astral's failure to file and serve an amended writ of summons and amended statement of claim by 19 September 2011, may proceed to lodge a bill of costs for taxation before a Registrar of this court in respect of a claim for any wasted legal costs or disbursements arising and that the amount of any wasted costs or disbursements that may be ascertained by that taxation be ordered as payable to the defendants immediately thereafter.
(Page 10)
33 The costs of the directions hearing held on 22 September 2011 were dealt with by order 5, on the basis they be paid to the defendants in any event. Issue (b) concerns the distinct issue of costs thrown away, which were reserved and as to which I granted the defendants liberty to apply.
Issue (c): Special costs orders arising out of the six iterations of a statement of claim between 3 August 2011 and 13 September 2012
34 By their minute, the defendants also seek orders that 'the plaintiff pay the defendants' cost of and incidental to the amendments made to the plaintiff's pleadings and Minutes set out below, to be taxed if not agreed without regard to the maximum limits (including hourly limits) prescribed by the relevant scale'.
35 During the course of the special appointment on 7 November 2012, counsel for the defendants indicated the wording of the proposed order sought to capture the defendants' costs thrown away, by reason of six iterations of Astral's statement of claim. The minute's terminology, 'of and incidental to', was intended to capture what counsel referred to as 'the costs of conferral'.
36 Counsel for the defendants pointed to what he suggested was a somewhat extraordinary situation, where there had been, across a period of about 13 months, six iterations of a very complex pleading. It had taken 13 months to get to a point where there was a statement of claim sufficient to occasion the obligation upon the defendants to plead a defence. Deficiencies in a very complicated statement of claim that was evolving over time, necessarily delivered an unsatisfactory costs burden for the defendants, particularly in circumstances where the court now allows an unlimited right of amendments to pleadings up to within seven weeks of trial: see O 21 r 3(1).
37 In the end, three key factors bear against special costs orders of the character presently sought by the defendants. In the first place, save for determinations reached at the two special appointments, which are the subject of earlier components in these reasons, the court for the most part has not been called on to reach or make determinations upon the merits or defects of most of the various iterations of the statement of claim. To the extent the court has been called upon to make determinations rather limited in scope, it has done so. Thus, very much for the same reason that an award of costs in the cause is the appropriate outcome for issue (a) in these reasons, in circumstances where costs have not otherwise been dealt with, those same considerations are broadly relevant where pleading arguments have not been fully ventilated. That is not to suggest that
(Page 11)
- parties should be encouraged to litigate to finality interlocutory pleading arguments, to enliven a potential costs entitlement. Again the court's attitude is very much to the contrary. But from the viewpoint of encouraging parties to sensibly confer and to resolve as between themselves as much as they can upon interlocutory arguments over pleading issues, a generally fairer disposition is to order costs to be in the cause.
38 A second consideration is that I have, at seven prior directions hearings spanning 1 September 2011 - 26 September 2012, already made some specific costs orders which bear upon the ongoing pleading disputation, beyond the orders of 22 September 2011. There were interlocutory orders as to costs on 1 September 2011 (in the defendants' favour fixed at $440), 8 December 2011 (in the defendants' favour fixed at $2,282), 21 December 2011 (costs in the cause), 8 February 2012 (costs in the cause) and 26 September 2012 (costs in the cause).
39 The order the defendants now seek, as regards all six pleading iterations (one of which is a minute of 3 October 2011) of Astral's statement of claim, manifests a rolled up global approach. It suggests the defendants should be entitled to all costs associated with what has unfolded across 13 months of iterations of the statement of claim. In my view, that global approach is unfocused. It is not appropriate.
40 Third, O 66 r 3(1) and its ramifications need to be taken account of. That is so particularly in circumstances where there is now a right to amend seven weeks before a trial commences. O 66 r 3(1) of the RSC provides:
The costs of and occasioned by an amendment made without leave in the writ or any pleading shall be borne by the party making the amendment, unless the Court otherwise orders.
41 To the extent not already covered by my express orders, the operative consequence of O 66 r 3(1) will deliver outcomes such that the defendants are to be entitled to their costs of, and occasioned by, the plaintiff's amendments in:
• the substituted statement of claim of 19 December 2011;
• the amended substituted statement of claim of 20 March 2012;
• the re-amended substituted statement of claim of 21 August 2012; and
(Page 12)
- • the further re-amended substituted statement of claim of 13 September 2012.
42 Accordingly, by O 66 r 3(1) the defendants should have leave to file bills of costs in respect of any wasted legal costs they claim to have sustained arising out of those four pleadings, on a basis they be taxed and that on ascertainment be payable immediately.
43 In circumstances where the defendants have not yet filed a defence, the onus is on the defendants, by proper affidavit materials submitted to the taxing officer, to show their actual wasted legal costs in the sense of pointing out legal work for the defendants rendered worthless as a result of the plaintiff's pleading amendments.
44 It is at this point that I should address an issue concerning time spent between legal advisors in the process of conferral. A pleading amendment would not, of itself, mean that a prior conferral between legal advisers had necessarily been wasted. What would need to be demonstrated is a wholly wasted conferral occasion, tied to the effect of the ensuing amendment. In most instances it would be difficult, I would imagine, to show that any particular conferral exchange between the parties' legal advisors has been a completely wasted exercise. But in some situations that might just be possible. Waiver of privilege issues could intrude into any such an assertion and response. So in the norm such an application for wasted costs would more likely proceed once the litigation was completed. Policy considerations referred to by Le Miere J in Major v Woodside Energy Ltd[No 3] [2009] WASC 246 [16] and [20], concerning a court's fulsome encouragement of the process of conferral, must be kept in mind. The court strongly promotes a sensible and responsive dialogue between the parties' legal advisers with a view to resolving all expressed grievances by the opponent party. The process must promote the avoidance of wasteful expense associated with unnecessary formal interlocutory hearings, and not discourage proper concessions.
45 The present case, where there have been six iterations of a long and complex statement of claim evolving over 13 months, carries somewhat unique considerations, in the context of a claim for wasted conferral expense by the defendants. But the defendants should not be denied, in my view, a proper opportunity to show to a taxing officer, if they can, by proper evidence that they have sustained wasted legal costs, including wasted conferral expenditure. If they can surmount that proof threshold
(Page 13)
- and show true waste, they should not be prevented from immediately receiving an amount ascertained in their favour at a taxation.
46 However, I am not persuaded that for the purpose of such a taxation it would be appropriate to remove or adjust any of the scale allowances set under the legal costs determination scale. I repeat, this is not a situation of indemnity costs being awarded. In my view, the scale allowances, particularly under items 10(a), 17, 24 and 33, present as prima facie appropriate to any taxation exercise, as sought.
47 Accordingly, I would propose to order that the defendants have leave to proceed, pursuant to O 66 r 3(1), to a taxation before a Registrar of this court seeking costs arising out of the four amendments to the statement of claim I have identified and that any amounts ascertained at that taxation would then be payable immediately to the defendants.
Issue (d): Further pleading challenges as regards par 105
48 These issues did not, in the end, proceed to argument on 7 November 2012. But obviously, some legal costs were incurred in preparation for the argument that did not in the end proceed: see parties' respective written submissions (defendants' written submissions of 22 October 2012 and plaintiff's outline of submissions concerning par 105 and par 106 of 29 October 2012).
49 On this aspect, Astral should have its costs of resisting that further challenge with those costs fixed at $440 (see item 2.8 of Consolidated Practice Directions 4.7.1.1).
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