Australand Holdings Ltd v Oceania Property Corp Pty Ltd

[1998] FCA 1131

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 61 of 1998

BETWEEN:

AUSTRALAND HOLDINGS LIMITED
APPLICANT

AND:

OCEANIA PROPERTY CORP PTY LIMITED
FIRST RESPONDENT

GOLDER ASSOCIATES PTY LTD
SECOND RESPONDENT

JUDGE:	SACKVILLE J.
DATE:	4 SEPTEMBER, 1998
PLACE:	SYDNEY

REASONS FOR JUDGMENT

HIS HONOUR:   An issue has arisen concerning the costs of a motion filed by the first respondent.  In that motion, the first respondent sought an order that a separate question be formulated for determination by the Court in advance of other matters in the hearing, pursuant to O 29, r 2, of the Federal Court Rules. 

The substance of that motion was debated at a hearing on 18 June, 1998.  At that time I indicated that I thought there were considerable difficulties with the motion, largely because it was not easy to formulate a suitable question for separate determination.  This in turn came about because it was clear that the applicant intended to rely, not merely upon documentation, but upon circumstances surrounding certain negotiations that took place over a significant period of time. 

In the event, the motion has not been pursued.  All that remains is the question of costs.  Mr Preston, who appeared on behalf of the applicant, seeks costs, essentially on the basis that costs should follow the event. 

His submission is that there were always going to be overwhelming difficulties in the path of the formulation of a separate question for determination in this case.  He points out that, in the case as pleaded, reference was made to circumstances other than documentation.  For example, paragraph 5 of the Amended Statement of Claim refers to the course of negotiations between the parties and paragraph 9 refers to the state of knowledge of the first respondent in relation to certain matters. 

Mr Muddle, who appeared on behalf of the first respondent, has submitted that there was a reasonable basis for the first respondent to pursue the motion.  He says the difficulties were caused essentially by a shift in the applicant's position.  In particular, he contends that the applicant changed course as to the surrounding circumstances upon which it intended to rely in support of its case.

The issue of costs in this particular matter, I think, is quite a difficult one. I have some sympathy for the position of the first respondent.  It found itself involved in litigation in which it might ultimately have to play a comparatively small part compared with the role of other parties in the litigation.  It has been seeking a way out of that potentially difficult situation.  However, I do think that from the outset there were considerable difficulties in the path of the first respondent in seeking to formulate a separate question.  Whether or not there has been any change of direction on the part of the applicant, the fact is that the pleading and the particulars to which I have been taken indicated that the issues included the circumstances relating to the negotiations between the parties and the state of knowledge of the first respondent.

That factor seems to me to have really doomed the application for a separate question to be formulated.  In those circumstances, notwithstanding the sympathy that I have for the first respondent's position, I think the appropriate course is that the costs should follow the event.  Accordingly, I order that the first respondent pay the applicant's costs of the motion filed on 8 May, 1998.

I certify that this and the preceding one (1) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Sackville

Associate:

Dated:  4 September, 1998

Counsel for the Applicant:

Mr B J Preston

Solicitor for the Applicant:

Mallesons Stephen Jaques

Counsel for the First Respondent:

Mr W Muddle

Solicitor for the First Respondent:

Minter Ellison

Solicitor for the Second
Respondent

Date of Hearing:

Phillips Fox

4 September 1998

Date of Judgment:

4 September 1998