Bavarian Hospitality Group Pty Ltd v SakeSake Izakaya Pty Limited (No 2)

[2010] FCA 1137

FEDERAL COURT OF AUSTRALIA

Bavarian Hospitality Group Pty Ltd v SakeSake Izakaya Pty Limited (No 2) [2010] FCA 1137

Citation:		Bavarian Hospitality Group Pty Ltd v SakeSake Izakaya Pty Limited (No 2) [2010] FCA 1137
Parties:		BAVARIAN HOSPITALITY GROUP PTY LTD v SAKESAKE IZAKAYA PTY LIMITED
File number(s):		NSD 1297 of 2010
Judge:		JAGOT J
Date of judgment:		22 October 2010
Catchwords:		COSTS – costs of interlocutory hearing – costs order be taxable forthwith.
Legislation:		Federal Court Rules
Cases cited:		Bavarian Hospitality Group Pty Ltd v SakeSake Izakaya Pty Limited [2010] FCA 1102
Date of hearing:	7 October 2010
Date of last submissions:	15 October 2010
Place:	Sydney
Division:	GENERAL DIVISION
Category:	Catchwords
Number of paragraphs:	5
Counsel for the Applicant:	Mr M Hall
Solicitor for the Applicant:	Christie Law
Counsel for the Respondent:	Mr EJC Heerey
Solicitor for the Respondent:	Mills Oakley Lawyers

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES
GENERAL DIVISION	NSD 1297 of 2010

BETWEEN:	BAVARIAN HOSPITALITY GROUP PTY LTD Applicant
AND:	SAKESAKE IZAKAYA PTY LIMITED Respondent

JUDGE:	JAGOT J
DATE OF ORDER:	22 OCTOBER 2010
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.The applicant pay the respondent’s costs of the interlocutory application heard on 7 October 2010, as agreed or taxed.

2.The respondent be entitled to have the bill of costs taxed forthwith.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION	NSD 1297 of 2010

BETWEEN:	BAVARIAN HOSPITALITY GROUP PTY LTD Applicant
AND:	SAKESAKE IZAKAYA PTY LIMITED Respondent

JUDGE:	JAGOT J
DATE:	22 OCTOBER 2010
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1. On 7 October 2010 I dismissed the applicant’s motion for interlocutory relief (Bavarian Hospitality Group Pty Ltd v SakeSake Izakaya Pty Limited [2010] FCA 1102).

2. The outstanding issue is the costs of this unsuccessful interlocutory application.  Both parties sought an opportunity to file further submissions in support of their competing contentions.  The applicant submitted that there should be no  order as to costs so that the default provision in O 62 r 29 of the Federal Court Rules would apply (the costs of the interlocutory application will be the successful party’s costs in the cause).  The respondent sought an order for costs in its favour, the costs to be taxable forthwith under O 62 r 3.  Both parties claim that the weight of authority favours their contention.

3. Costs are in the court’s discretion.  In the present case, although I accepted the existence of a prima facie case (at [21] of the principal reasons), I declined to characterise it as very strong or very weak.  This is because I was satisfied that the balance of convenience weighed heavily in the respondent’s favour (at [35]).

4. By the interlocutory application the applicant sought to establish a new status quo rather than to preserve the existing state of affairs.  The applicant did so because it had sat on its hands for at least three months while the respondent opened its business and started to trade.  It did so, it must be inferred, knowing that the effect of the interlocutory order sought would cause serious hardship to the respondent, assuming the respondent’s enterprise to be a normal commercial venture.  The applicant failed in its application.

5. In these circumstances, the ordinary compensatory principle should operate.  The applicant should pay the respondent’s costs.  The respondent would not have incurred those costs but for the applicant’s decision to make its application in the circumstances described.  I see no reason, moreover, why the respondent should not be permitted to tax its costs forthwith.  The applicant was wholly unsuccessful.  The interlocutory application foundered on the balance of convenience.  Those issues are unrelated to the case to be determined at trial.  The respondent’s funds are apparently more limited than those of the applicant.  These circumstances, taken with the real weakness of the applicant’s case on the balance of convenience, indicate that it is appropriate to otherwise order under O 62 r (3).

I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jagot.

Associate:

Dated:        22 October 2010