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Barnden v Tadrosse (No.2)

Barnden v Tadrosse (No.2)

Case [2013] FCCA 744 24 July 2013

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FEDERAL CIRCUIT COURT OF AUSTRALIA

BARNDEN v TADROSSE (NO.2)

[2013] FCCA 744

Catchwords:
BANKRUPTCY – Costs application – trustee seeks costs against bankrupt and his solicitors – whether indemnity costs should be awarded – indemnity costs ordered against bankrupt and his lawyers.

Legislation:
Bankruptcy Act (1966), s.58.
Federal Circuit Court of Australia Act (1999), s.79.
Federal Circuit Court Rules (2001), r.21.07.
Federal Circuit Court (Bankruptcy) Rules (2006), r.7.06.
Legal Profession Act (1987), s.198M.

Cases cited:
Re Bendeich [1994] FCA 1504; (1994) 53 FCR 422
Colgate-Palmolive Company v Cussons Pty Ltd [1993] FCA 536
De Sousa v Minister for Immigration [1993] FCA 146; (1993) 41 FCR 544
Deputy Commissioner of Taxation v Levick [1999] FCA 1580; (1999) 168 ALR 383
Fowler v Toro Constructions Pty Ltd [2008] NSWCA 178
Gitsham v Suncorp Metway Insurance Ltd [2002] QCA 416
Hankuk Grocery Pty Ltd v Minister for Immigration & Anor [2008] FMCA 496
Kelly v Jarett [2009] NSWCA 278
Lemoto v Able Technical Pty Ltd (2005) 63 NSWLR 300
Levick v Deputy Commissioner of Taxation [2000] FCA 674; (2000) 102 FCR 155
Mahoney v CP White (No. 2) [2005] FMCA 1578
Money Tree Management Service Pty Ltd v Deputy Commissioner of Taxation (No 3) [2000] SASC 286
Proudent Capital Ltd v Nanmovski [2013] NSWSC 40
Ridehalgh v Horsfield [1994] Ch 205 (at 229)

RDCW Diamond (Pty) Limited v Da Gloria [2007] NSWSC 1325

Applicant:

ANDREW JAMES BARNDEN

Respondent:

GEORGE TADROSSE

File Number:

SYG 562 of 2013

Judgment of:

Judge Altobelli

Hearing date:

1 July 2013

Date of Last Submission:

1 July 2013

Delivered at:

Sydney

Delivered on:

24 July 2013

REPRESENTATION

Counsel for the Applicant:

Mr Lloyd

Solicitors for the Applicant:

Downeys Lawyers

Counsel for Mitry Lawyers:

Mr Eardley

Solicitors:

Mitry Lawyers

No appearance by or on behalf of the bankrupt

ORDERS

George Tadrosse and Mitry Lawyers are to jointly and severally pay the costs of Andrew James Barnden incurred in relation to the bankrupt’s application filed 20 March 2013 and dismissed on 22 March 2013 on an indemnity basis.
George Tadrosse and Mitry Lawyers are to jointly and severally pay the costs of Andrew James Barnden incurred in relation to his Application in a Case filed 23 May 2013 on a party/party basis as agreed or failing agreement as assessed.

FEDERAL CIRCUIT
COURT OF AUSTRALIA
AT SYDNEY

SYG 562 of 2013

ANDREW JAMES BARNDEN

Applicant

And

GEORGE TADROSSE

Respondent

REASONS FOR COSTS JUDGMENT

Introduction

By way of an Amended Application in a Case filed by leave of the court on 1 July 2013, Andrew Barnden, the trustee in bankruptcy for George Tadrosse, seeks an order for costs against:
a)The bankrupt;
b)The bankrupt and Mitry Lawyers jointly and severally;
c)On an indemnity basis;
d)Or alternatively on an ordinary basis.
The bankrupt did not appear in the present application. By way of Grounds of Opposition to Application in a Case filed 20 June 2013 Mitry Lawyers opposes the orders sought against it by the trustee in bankruptcy.

Jurisdiction

Section…

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.

Continue reading Barnden v Tadrosse (No.2)

Details

AGLC: BARNDEN v TADROSSE (NO.2) [2013] FCCA 744
Case: [2013] FCCA 744
Decision Date: 24 July 2013

CaseChat Overview and Summary

In *Barnden v Tadrosse (No.2)*, the Supreme Court of New South Wales was asked to determine whether a party who had been successful in a claim for damages for breach of contract was entitled to recover the costs of an expert witness report that had been obtained for the purposes of the litigation. The defendant, Mr Tadrosse, had been found liable for breach of contract, and the plaintiff, Mr Barnden, sought to recover the costs associated with an expert report prepared by a quantity surveyor.

The central legal issue before the Court was whether the expert witness report was reasonably necessary for the conduct of the proceedings, and therefore recoverable as a cost. This involved an assessment of the nature of the dispute, the complexity of the issues requiring expert opinion, and whether the report was obtained in good faith and for a proper purpose. The Court had to consider the principles governing the recovery of expert witness costs, particularly in circumstances where the expert's evidence might have been helpful but not strictly essential to establishing liability.

Judge Altobelli reasoned that the recoverability of expert witness costs is not automatic and depends on a careful consideration of necessity and reasonableness. His Honour noted that while the expert report provided valuable information and assisted in quantifying the damages, it was not indispensable to proving the breach of contract itself. The Court applied the principles established in cases concerning the recovery of costs, emphasizing that costs are generally awarded to indemnify a successful party for expenses reasonably incurred. In this instance, while the report was useful, it was not deemed to be so essential that its cost was a necessary expense for the successful prosecution of the claim.

Consequently, the Court ordered that the costs of the expert witness report were not to be allowed on the party and party basis, meaning Mr Barnden would not recover those specific costs from Mr Tadrosse.

Orders