Bloom as Executor of the Estate of Farr v Paradise Lake Pty Ltd (No.4)
[2020] FCCA 2442
•24 August 2020
FEDERAL CIRCUIT COURT OF AUSTRALIA
| BLOOM AS EXECUTOR OF THE ESTATE OF FARR v PARADISE LAKE PTY LTD (No.4) | [2020] FCCA 2442 |
| Catchwords: PRACTICE AND PROCEDURE – COSTS – Whether on its proper construction an order for costs previously made was to the effect that the costs covered by the order be assessed in accordance with Part 1 of Schedule 1 to the Federal Circuit Court Rules 2001 (Cth) or whether those costs were to be taxed pursuant to Part 40 of the Federal Court Rules 2011 (Cth). |
| Legislation: Federal Circuit Court Rules 2001 (Cth), rr.21.02, 21.09. 21.10, 21.15, Schedule 1, Part 1 |
| Cases cited: Radmanovich v Nedeljkovic [2002] NSWSC 212 |
| Applicant: | MELVYN BLOOM AS EXECUTOR OF THE ESTATE OF JOHN RONALD FARR (DECEASED) |
| Respondent: | PARADISE LAKE PTY LTD ACN 059 700 775 |
| File Number: | SYG 1729 of 2017 |
| Judgment of: | Judge Manousaridis |
| Hearing date: | 24 August 2020 |
| Date of Last Submission: | 24 August 2020 |
| Delivered at: | Sydney |
| Delivered on: | 24 August 2020 |
REPRESENTATION
| Counsel for the Applicant: | Ms M Bateman, by telephone |
| Solicitors for the Applicant: | Automic Legal Pty Ltd |
| Counsel for the Respondent: | Mr S Hartwell, by telephone |
| Solicitors for the Respondent: | Wilson Lawyers |
ORDERS
Pursuant to r.21.02(2)(c) to the Federal Circuit Court Rules 2001 (Cth) the costs ordered on 17 July 2019 be referred for taxation under Part 40 of the Federal Court Rules 2011 (Cth).
There will be no order as to costs with the intent that each party pay his or its own costs.
Pursuant to r.21.15 of Federal Circuit Court Rules 2001 (Cth) it is certified that it was reasonable for the parties to each employ an advocate to appear in the matter.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 1729 of 2017
| MELVYN BLOOM AS EXECUTOR OF THE ESTATE OF JOHN RONALD FARR (DECEASED) |
Applicant
And
| PARADISE LAKE PTY LTD ACN 059 700 775 |
Respondent
REASONS FOR JUDGMENT
(Revised from transcript)
On 17 July 2019 I made a final order in this matter, ordering that the respondent pay the applicant the amount of $45,394.73. In addition to that order I made the following orders:
(2)Subject to order 3, the respondent pay the applicant’s costs of the proceeding as agreed or as assessed or taxed.
(3)The parties have liberty to apply within 14 days to vary or discharge order 2.
The respondent exercised that liberty by applying to the Court for a variation to that order. The parties agreed that I could deal with that application in chambers on the papers, and I did so by delivering judgment on 2 September 2019 dismissing the application made by the respondent to vary the costs order I had made.
On the evidence that is before me nothing seems to have occurred in relation to the question of costs of any significance until sometime shortly before 14 April 2020. By that time the applicant had engaged a costs assessor in relation to the assessment of his costs. According to the affidavit of the applicant’s solicitor, Mr Whitten, on that day, that is to say, on 14 April 2020, he received advice from the costs assessor to the effect that r.21.02 of the Federal Circuit Court Rules2001 (Cth) (FCC Rules) applies. That rule is as follows:
(1) An application for an order for costs may be made:
(a) at any stage in a proceeding; or
(b) within 28 days after a final decree or order is made; or
(c) within any further time allowed by the Court.
(2) In making an order for costs in a proceeding, the Court may:
(a) set the amount of the costs; or
(b)set the method by which the costs are to be calculated; or
(c)refer the costs for taxation under Part 40 of the Federal Court Rules or under Chapter 19 of the Family Law Rules; or
(d)set a time for payment of the costs, which may be before the proceeding is concluded.
Mr Whitten in his affidavit also referred to r.21.10 of the FCC Rules which provides:
Unless the Court otherwise orders, a party entitled to costs in a proceeding (other than a proceeding to which the Bankruptcy Act applies) is entitled to:
(a) costs in accordance with Parts 1 and 2 of Schedule 1; and
(b) disbursements properly incurred.
Mr Whitten deposes that the costs assessor had concluded that, in the absence of a specific order from the Court, the costs covered by the costs order made on 17 July 2019 were required to be assessed in accordance with Schedule 1 to the FCC Rules, and that the engagement of counsel had to be certified.
Certain correspondence and communications then passed between Mr Whitten and the respondent’s lawyers, and it is unnecessary to set out that correspondence and communications which are the subject of the affidavit material that is before me. That then led the applicant to file an application in a case on 10 August 2020 in which the applicant seeks the following orders:
(1)Pursuant to Federal Circuit Court Rule 21(1)(c) time is extended for the making of the following orders 2-4 inclusive.
(2)That costs in this matter be assessed and are payable in accordance with Schedule 3 Federal Court Rules 2011.
(3)Pursuant to Federal Circuit Court Rule 21.15 the Court certifies that it was reasonable to employ an advocate to appear for the Applicant in these proceedings.
(4)Costs of this Application be paid by the Respondent as agreed or taxed.
The first question that arises is whether there is any need for the making of an order extending time. This turns on whether the orders made on 17 July 2019 can be properly characterised as an order for costs. Counsel for the respondent submitted that that is indeed the proper characterisation of the orders, and they are the orders that are binding on the parties. I agree that the proper characterisation of the orders made on 17 July 2019, or at least paragraphs 2 and 3 of those orders, constitute an order for costs. To that extent, therefore, there is no need to order an extension of time as indicated by r.21.02(1)(c) of the FCC Rules.
The next question concerns what those orders mean, that is to say what is the proper construction of those orders. A court may be required, and thus will have jurisdiction, to construe its own orders in a number of circumstances.[1] This may include the situation where a court is considering an application whose determination requires the court to apply a previous order it has made, and there is a dispute about the proper construction of the previous order. It may also occur where there is a dispute about the proper construction of final orders a court has made. Such dispute may be the subject of a separate proceeding, but as a matter of procedure there is no reason why that cannot occur in the proceeding in which the order is made. When one turns to the principles of construction the Court applies, the basic principle is that a court construes a court order just like any other document: “It does not delve into the subjective intention of the judge pronouncing the order”. [2]
[1] See the examples given in P. Herzfeld, T. Prince, and S. Tully Interpretation and Use of Legal Sources, 2013, Thomson Reuters at [25.4.690]
[2] Radmanovich v Nedeljkovic [2002] NSWSC 212, at [7] (Young CJ in Eq)
That brings me, then, to the submissions that have been made about how I should properly construe the orders made on 17 July 2019. Counsel for the respondent submitted that the orders, in effect, went no further than contemplating at least that the costs should be set or assessed by reference to Part 1 of Schedule 1 to the FCC Rules. Counsel submitted that the word “taxed” in my order is nothing more than a reference to the assessment of costs under that Schedule. Counsel for the applicant, on the other hand, submitted that “taxed” refers to the process of taxing costs as provided for, for example, by Part 40 of the Federal Court Rules 2011 (Cth) (FC Rules).
In my opinion, the words “as agreed or as assessed or taxed” as they appear in my orders contemplate the assessment of costs not under Part 1 of Schedule 1 to the FCC Rules, but under the FC Rules. Quite apart from the orders so contemplating, one must turn to Div 21.3 of the FCC Rules and r.21.09 which is engaged when costs are “payable, or to be taxed, under an Act, these Rules or an order of the Court, in a proceeding”. The question that arises is whether order 2 of the orders made on 17 July 2019, and in particular that costs be taxed “as agreed or as assessed or taxed” answers a description of “costs payable, or to be taxed, under . . . an order of the Court”. In my opinion, the order does answer the description in r.21.09 of the FCC Rules. The effect of that conclusion is that order 2 on its proper construction is an order that the costs be assessed or taxed (in the absence of the parties reaching agreement) in accordance with Part 40 of the FC Rules.
Consequently all I need to do is make an order under r.21.02(2)(c) of the FCC Rules referring the costs for taxation under Part 40 of the FC Rules, and I will make such order in a moment. That is not an order for costs. That is an order consequential on the order for costs I have made, and for that reason there is no need for there to be an order extending the time that is otherwise provided for in r.21.02 of the FCC Rules.
Before I make that order there are three other matters that I should address. First, the respondent read an affidavit made by Ms Anita Lazzarin, the financial controller of the respondent, in which she deposes to a belief that the costs in this matter would be assessed by reference to the relevant schedule to the FCC Rules. Whether that is so or not is not a matter I need to determine. As I have already noted, it is certainly within the power of the Court to order that costs be assessed other than by reference to Part 1 of Schedule 1 to the FCC Rules. In any event, as I have previously said, one of the matters before me is the proper construction of the orders made on 17 July 2019, and that is to be determined objectively without reference to the subjective intention of the judge or, indeed, of any other person.
The second matter I wish to address is the submission made by counsel for the respondent that, in any event, the costs in this matter should be assessed by reference to Part 1 of Schedule 1 to the FCC Rules. Counsel submitted that both the question as to liability and the question as to quantum each turned on a single issue, and the costs incurred relate to a matter or matters that one would expect would be litigated in this Court and for which it is intended that Part 1 of Schedule 1 to FCC Rules should apply.
I have previously considered the circumstances in which the Court may order that costs be assessed on a basis other than the costs set out in Schedule 1 to the FCC Rules.[3] In that case after I referred to the judgments of two judges of this Court I said:
…it is implicit in their Honours’ approach that it would be appropriate for the Court to do so where the proceeding is not what the Court would consider to be a typical or usual proceeding in this Court. That, in turn, implies a sufficiently precise notion of what constitutes a typical or usual proceeding in the Court. Does such a notion exist? Or is such notion capable of being formulated in any given case? In my opinion, the answer to both questions is yes.
A proceeding in the Court is capable of being characterised in terms of its subject matter; the procedural steps that may be taken to progress the proceeding, given its subject matter; the novelty or difficulty of any legal questions that may arise; the extent and nature of the factual issues that arise; and the manner in which the parties, and in particular, the unsuccessful party, conducts the proceeding. In any given case, the experience of a Judge of the Court will enable him or her to determine whether any given proceeding is not typical in any one or more of these respects such as may warrant a departure from having costs assessed under Part 1 of Schedule 1 to the FCC Rules.
[3] Robinson v Blackheart Industries Proprietary Limited & Ors (No. 3) [2015] FCCA 2542, at [16]-[17]
It is true, as counsel for the respondent submitted, that there were indeed single issues in each of the liability and quantum hearings; but as my reasons for judgment should indicate, the determination of both those issues required an extensive analysis of events which could not be fairly characterised as typically representing cases conducted in this Court. It is for that very reason that I made the costs order in the form that I did.
It is true that the order could have been, and, in retrospect ought to have been, formulated more precisely; but the idea behind the relative looseness of expression was that the parties would be given an opportunity to apply within 14 days to make submissions and to alter the order for costs that I made. In any event, had the liberty been exercised by the respondent and submissions were then made that the costs of this matter should be assessed by reference to Schedule 1 to the FCC Rules, I would not have accepted that submission.
Finally, there is the question of delay. There is delay. Mr Whitten has given an explanation for the delay. It is, of course, general and would need to be looked at more carefully if a submission were made that the respondent suffered particular prejudice because of the delay; but none has been submitted other than the delay itself. Although delay is always to be regretted, and is to be actively discouraged, the delay in question ought not to count against the applicant in relation to any of the matters on which the applicant relies in favour of his application.
As to the question of costs of this application, counsel for the respondent submitted that no orders as to costs should be made because given the ambiguity, or at least lack of clarity and detail, in the orders, the matter would have had to come back before me for this very question to be determined. Counsel for the applicant submitted that costs should follow the event. I will order that there be no order as to costs with the intent that each party pay his or its own costs.
Just as I adjourned the matter, counsel for the applicant reminded me that I did not address one of the orders sought in the application in a case, and that is that I certify, pursuant to r.21.15 of the FCC Rules, that it was reasonable for the applicant to employ an advocate to appear for the applicant in these proceedings. Under r.21.15 of the FCC Rules a “Court or a Registrar may certify that it was reasonable to employ an advocate”. In my opinion, this was a case that merited both parties being represented by counsel. I will also, therefore, certify that it was reasonable for both parties to employ an advocate to appear at the hearings in this matter.
I certify that the preceding nineteen (19) paragraphs are a true copy of the reasons for judgment of Judge Manousaridis
Associate:
Date: 4 September 2020
0
2
3