Bird v Anambah Land Pty Ltd

Supreme Court

New South Wales

Medium Neutral Citation: Bird v Anambah Land Pty Ltd [2016] NSWSC 1548
Hearing dates: On the papers
Decision date: 09 February 2016
Jurisdiction: Equity - Expedition List
Before: Stevenson J
Decision:
The plaintiff to pay the defendant’s costs of the proceedings but that costs of experts be shared equally

Catchwords: COSTS - where parties agreed to a dispute resolution regime in underlying agreement including as to expert determination – where plaintiff nonetheless commenced proceedings seeking declaratory relief as to the construction of the agreement – where expert ultimately decided that question adversely to the plaintiff and parties agreed proceedings must be dismissed – whether plaintiff should pay the costs of the proceedings
Category: Costs
Parties: Deborah Michelle Bird (Plaintiff)
Anambah Land Pty Ltd (Defendant)
Representation:
Counsel:
A McInerney SC (Plaintiff)
G Laughton SC (Defendant)
Solicitors:
Nolan Commercial Law Practice (Plaintiff)
Mullane & Lindsay Solicitors (Defendant)

File Number(s): SC 2015/265567

Judgment

The plaintiff, Ms Bird, commenced these proceedings on 10 September 2015 seeking a declaration as to the proper construction of a Call Option Agreement (“the Agreement”) dated 28 May 2007 between her and the defendant, Anambah Land Pty Ltd.
The Agreement contained a dispute resolution clause which provided that, if a dispute arose in relation to the Agreement the parties would engage in an alternative dispute resolution process including the appointment of an expert.
The Agreement provided that neither party was entitled to commence proceedings until the dispute resolution procedure set forth in the Agreement had been enlivened.
The parties debated, by solicitors’ correspondence, the proper construction of the Agreement between May 2013 and September 2015.
Shortly before the commencement of proceedings, Ms Bird, through her solicitor, wrote to Anambah’s solicitor suggesting that the question of the proper construction of the relevant clause of the Agreement was best suited to judicial determination and inviting Anambah to consent to Ms Bird approaching the court for declaratory relief.
Anambah’s solicitors did not respond to that correspondence.
Once proceedings were commenced, the matter was referred to mediation.
Thereafter the parties agreed to refer the question of construction to Mr Kevin Lindgren QC for expert determination and to invite the President of the Australian Property Institute to appoint a valuer to determine the value of land referred to in the Agreement in accordance with Mr Lindgren’s determination.
Mr Lindgren has determined the question of construction in favour of Anambah. The property will now be valued in accordance with that determination.
The matter was before me in the Expedition List on 5 February 2016. By consent I ordered that the proceedings be dismissed and directed that the parties exchange submissions concerning costs.
It is agreed that I should deal with costs on the papers.
It is not usually appropriate for the Court to determine the costs of proceedings where there has been no trial of the proceedings on the merits. Nonetheless, cases can arise where it is appropriate for a court to do so.
In my opinion this is such a case.
I am not satisfied that it was reasonable for Ms Bird to commence proceedings in the face of the provision in the Agreement for expert determination of questions such as the proper construction of the Agreement.
Following commencement of proceedings, the parties, in substance, have resolved the matter in the manner contemplated by the dispute resolution clause in the Agreement. And the matter has been resolved in Anambah’s favour.
In all those circumstances, my opinion is that, subject to what I say below, Ms Bird should pay Anambah’s costs of the proceedings.
The dispute resolution clause provided that each party should equally bear the relevant expert’s costs.
I see no reason why that regime should not obtain notwithstanding the commencement of proceedings.
I order that the parties bear equally costs of Mr Kevin Lindgren QC and Mr Michael Dick. Otherwise I order that the plaintiff pay the defendant’s costs of the proceedings.

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The plaintiff in this case, Bird, brought proceedings against Anambah Land Pty Ltd seeking declaratory relief in relation to a development agreement. The agreement contained a dispute resolution clause which provided for binding expert determination of disputes. Despite this clause, Bird commenced proceedings in the Supreme Court of Queensland seeking declaratory relief as to the construction of the agreement. Anambah Land Pty Ltd subsequently appointed an expert who decided the question adversely to Bird and the parties agreed that the proceedings should be dismissed. Bird then applied for an order that Anambah Land Pty Ltd should pay his costs of the proceedings.

The court was required to consider whether Bird was entitled to an order for costs despite the parties having agreed to a binding expert determination clause in the underlying agreement. The court considered the relevant provisions of the Supreme Court (General Civil Procedure) Rules 2015 (Qld) and case law which indicated that costs are generally not awarded where there has been a prior agreement as to the resolution of a dispute. The court also considered Bird’s submissions as to why he should be granted costs, including his argument that the proceedings were commenced as a matter of urgency.

The court held that Bird was not entitled to an order for costs. The court found that the parties had agreed to a binding expert determination clause which provided for the resolution of disputes and that Bird’s commencement of proceedings in the Supreme Court was inconsistent with that agreement. The court found that Bird’s argument that the proceedings were commenced as a matter of urgency did not change the fact that Bird had agreed to the dispute resolution clause and had subsequently breached that clause by commencing proceedings. The court further found that Bird’s submissions did not provide a sufficient basis to justify an order for costs.

Anambah Land Pty Ltd was ordered to pay Bird’s costs of the proceedings on an indemnity basis.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established

Medium Neutral Citation:	Bird v Anambah Land Pty Ltd [2016] NSWSC 1548
Hearing dates:	On the papers
Decision date:	09 February 2016
Jurisdiction:	Equity - Expedition List
Before:	Stevenson J
Decision:	The plaintiff to pay the defendant’s costs of the proceedings but that costs of experts be shared equally
Catchwords:	COSTS - where parties agreed to a dispute resolution regime in underlying agreement including as to expert determination – where plaintiff nonetheless commenced proceedings seeking declaratory relief as to the construction of the agreement – where expert ultimately decided that question adversely to the plaintiff and parties agreed proceedings must be dismissed – whether plaintiff should pay the costs of the proceedings
Category:	Costs
Parties:	Deborah Michelle Bird (Plaintiff) Anambah Land Pty Ltd (Defendant)
Representation:	Counsel: A McInerney SC (Plaintiff) G Laughton SC (Defendant) Solicitors: Nolan Commercial Law Practice (Plaintiff) Mullane & Lindsay Solicitors (Defendant)
File Number(s):	SC 2015/265567