Balout v Bella Ikea Cronulla Pty Ltd (No 2) - [2024] NSWSC 1173

Supreme Court

New South Wales

Medium Neutral Citation: Balout v Bella Ikea Cronulla Pty Ltd (No 2) [2024] NSWSC 1173
Hearing dates: On the papers; last submissions 27 August 2024
Date of orders: 20 September 2024
Decision date: 20 September 2024
Jurisdiction: Equity - Expedition List
Before: Rees J
Decision:
Costs orders made.

Catchwords:
COSTS – proceedings overtaken by subsequent events – no final determination on merits – rule 42.20, Uniform Civil Procedure Rules 2005 (NSW) – complex and protracted proceedings partly resolved interlocutory orders and defendant terminating contracts for sale of land – remaining causes of action premised on contracts proceeding to completion – whether grounds for Court to “order otherwise” – principles at [48]-[54] – plaintiffs have effectively obtained the relief sought – remaining issues became otiose as proceedings developed and by defendant’s actions – plaintiff acted reasonably – defendant acted unreasonably for portion of litigation.

Legislation Cited:
Civil Procedure Act 2005 (NSW), s 98
Uniform Procedure Rules 2005 (NSW), rr 12.1, 42.19, 42.20

Cases Cited:
Australian Receivables Ltd v Tekitu Pty Ltd [2011] NSWSC 1425
Australiawide Airlines Ltd v Aspirion Pty Ltd [2006] NSWCA 365
Balout v Bella Ikea Cronulla Pty Ltd [2024] NSWSC 775
Bitannia Pty Ltd v Parkline Constructions Pty Ltd [2009] NSWCA 32
Cummins v Australian Jockey Club Ltd [2009] NSWSC 254
Donald Campbell & Co Ltd v Pollak [1927] AC 732
Edwards Madigan Torzillo Briggs Pty Ltd v Stack [2003] NSWCA 302
Foukkare v Angreb Pty Ltd [2006] NSWCA 335
Hunter Development Corporation v Save Our Rail NSW Incorporated (No 2) [2016] NSWCA 375
Ibrahim v PERI Australia Pty Limited [2013] NSWCA 328
In the matter of Jimmy’s Recipe Pty Limited (No 4) [2020] NSWSC 1244
In the matter of Ming Tian Real Property Pty Ltd [2021] NSWSC 386
Kiama Council v Grant [2006] NSWLEC 96
Nichols v NFS Agribusiness Pty Ltd [2018] NSWCA 84
One.Tel Ltd v Deputy Commissioner of Taxation (2000) 101 FCR 548
Re Minister for Immigration and Ethnic Affairs (Cth); Ex Parte Lai Qin (1997) 186 CLR 622; [1997] HCA 6
Roachev News Group Newspapers [1992] TLR 551
Sydney MarketsCredit Services Co-operative Ltd v Taylor (No 3) [2015] NSWSC 1236
The Metropolitan Asylum District Managers v Hill (1880) 5 AC 582
Transtar Linehaul Pty Ltd v Chief Commissioner of State Revenue (CSR [2021] NSWSC 159

Category: Costs
Parties: Alan Balout (First Plaintiff)
Wisefox Holdings Pty Ltd (Second Plaintiff)
Bella Ikea Cronulla Pty Ltd (First Defendant)
Bella & SEB Holdings (Second Defendant)
Joseph Touma (Third Defendant)
11 Kingston Avenue Pty Ltd (Fifth Defendant)
Representation: Counsel:
P Afshar (First and Second Plaintiffs)
C P O’Neill / A Rizk (First to Third Defendants)
A Byrne (Fifth Defendant)
Solicitors:
Mistry Fallahi (Plaintiffs)
Hicksons Lawyers (First to Third Defendants)
Thurlow Fisher (Fifth Defendant)

File Number(s): 2023/156633

JUDGMENT

HER HONOUR: This judgment concerns what costs orders, if any, should be made where the claim and cross-claim will not be proceeding to final determination, having been largely overtaken by events.
The plaintiffs, Alan…

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: [2024] NSWSC 1173
Decision Date: 20 September 2024

CaseChat Overview and Summary

Balout v Bella Ikea Cronulla Pty Ltd (No 2) was a legal dispute brought before the Supreme Court of New South Wales. The plaintiffs, Balout, were contesting various claims against the defendant, Bella Ikea Cronulla Pty Ltd, which involved the sale of land and the performance of associated contractual obligations. The court was tasked with determining whether the plaintiffs were entitled to costs in light of the proceedings being overtaken by subsequent events, resulting in no final determination on the merits.

The legal issues before the court centred on whether the plaintiffs were entitled to costs under rule 42.20 of the Uniform Civil Procedure Rules 2005 (NSW). The proceedings had been lengthy and complex, involving several interlocutory orders and the termination of contracts for the sale of land by the defendant. Although the remaining causes of action proceeded to completion, the court had to assess whether the plaintiffs had effectively obtained the relief they sought and if the remaining issues had become irrelevant due to the defendant's actions.

The court found that the plaintiffs had achieved the relief they sought through their actions and that the remaining issues had become otiose as the proceedings progressed and due to the defendant's conduct. The court emphasised that the plaintiffs had acted reasonably throughout the litigation, while the defendant had acted unreasonably for a significant portion of the proceedings. Consequently, the court determined that the plaintiffs were entitled to costs, considering the principles set out in the case law referenced.

The final orders of the court were that the plaintiffs were to recover their costs of the proceedings, subject to certain adjustments. This decision was made in light of the plaintiffs achieving the relief they sought, the otiose nature of the remaining issues, and the unreasonable conduct of the defendant during the litigation.

Orders