Bondi Beach Astra Retirement Village Pty Ltd v Noon (No 2)

[2009] NSWSC 893

CITATION:	Bondi Beach Astra Retirement Village Pty Ltd v Noon (No 2) [2009] NSWSC 893
HEARING DATE(S):	Question of costs dealt with in chambers.
JUDGMENT DATE :	31 August 2009
JUDGMENT OF:	Smart AJ
DECISION:	Ninety per cent of one set of costs allowed to plaintiffs.
CATCHWORDS:	Costs - two plaintiffs joined because of ambiguous agreement prepared on their behalf - prudent to join both plaintiffs but order only made and could only be made in respect of one - avoidance of artificial, complicated, lengthy and expensive costs assessments
LEGISLATION CITED:	Civil Procedure Act 2005 Uniform Civil Procedure Rules
CATEGORY:	Consequential orders
CASES CITED:	Currabubula Holdings Pty Ltd & Anor v State Bank of NSW [2000] NSWSC 232 Haviv Holdings Pty Ltd v Howards Storage World Pty Ltd (No 2) [2009] FCA 652 K & J Acquisitions Pty Ltd v Manauzzi & Anor [2009] NSWSC 279
PARTIES:	Bondi Beach Astra Retirement Village Pty Ltd & CG Maloney Pty Ltd (Plaintiffs) GB & MJ Noon as Co-Executors of the Estate of the late BR Noon (Defendants)
FILE NUMBER(S):	SC 5436/06
COUNSEL:	M Leeming SC (Plaintiffs) S Donaldson SC / DA Moujalli (Defendants)
SOLICITORS:	Stephen Wawn & Associates (Plaintiffs) Pikes Lawyers (Defendants)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

Smart AJ

Monday 31 August 2009

5436/06
Bondi Beach Astra Retirement Village Pty Ltd & CG Maloney Pty Ltd v GB and MJ Noon as Co-Executors of the the Estate of the late BR Noon
(No 2)

JUDGMENT

1 HIS HONOUR: Consequent upon my Judgment of 2 June 2009, each of the parties made submissions as to costs and consented to the Court dealing with the question of costs in chambers. I have done so.

2 The plaintiffs sought an order that the defendants should pay their costs of the proceedings on an ordinary basis. The plaintiffs submitted that the defendants had not complied with s 56(3) of the Civil Procedure Act by persisting in raising as an issue that the buy back provisions of the contract were not annexed to, and formed part of, the contract of sale. This proved to be a non-issue once the conveyancing file of the former solicitors for the late B & J Noon was obtained. It was produced to the Court on the second day of the hearing. One of the unusual problems in the present case was that neither the vendor’s solicitors nor the vendor held a counterpart of the contract of sale singed by B & J Noon. The plaintiffs’ solicitors had an unsigned copy. Reliance was placed on the stamped copy contract executed by CG Maloney Pty Limited and the stamped and registered transfer.

3 The plaintiffs submitted that it was reasonable, given the ambiguous wording of the buy back provision, for both the vendor and the service company to sue. The wording of the buy back provision was ambiguous and difficult to interpret. It was drafted by the then solicitors for the vendor and left much to be desired. That caused many difficulties.

4 Given the unfortunate wording of the contractual documents, especially the Disclosure Statement, it was prudent for both the plaintiffs to sue.

5 The plaintiffs further submitted that there was one set of plaintiffs’ costs with one firm of solicitors and one counsel acting for the plaintiffs, and one body of testimonial and documentary evidence advanced in support of the plaintiffs’ case. The plaintiffs submitted that, likewise, there was one set of defendants’ costs.

6 The plaintiffs submitted that the orders suggested by the defendants as appropriate, namely:

a) the defendants pay the costs of CG Maloney Pty Limited of its claim, and
b) Bondi Beach Astra Retirement Village Pty Ltd pay the defendants’ costs of its claim

would create artificial difficulties of apportionment of each side’s costs.

7 Both parties accepted that, as a general rule, where a party has been successful in litigation, the commencing position is that the costs follow the event so that the successful party is entitled to its costs of the proceedings (UCPR 42.1). However, the Court has wide discretionary powers in respect of costs.

8 The defendants relied on the principle:

“Where several plaintiffs sue by the same solicitor, and one succeeds while the others fail, the successful plaintiff will be entitled to recover the whole of his costs from the defendant and not merely a proportion. The unsuccessful plaintiffs will be obliged to pay the defendant’s costs as occasioned by their having been joined unless the Court otherwise orders.”

9 This was adopted by Einstein J in Currabubula Holdings Pty Ltd & Anor v State Bank of NSW [2000] NSWSC 232 at [104]. It was referred to by Kirby J in K & J Acquisitions Pty Ltd v Manauzzi & Anor [2009] NSWSC 279 at [54] and by Jagot J in Haviv Holdings Pty Ltd v Howards Storage World Pty Ltd (No 2) [2009] FCA 652 at [27].

10 The defendants submitted that as Bondi Beach Astra Retirement Village Pty Ltd had been wholly unsuccessful in the litigation they were entitled to be compensated for the costs incurred in responding to its claim. The plaintiffs contended that it was the success of either of the plaintiffs that mattered and that it was never possible for both plaintiffs to obtain title to the unit.

11 During the hearing the plaintiffs relied on both companies being owned and controlled by the same people. In practical terms they were indivisible, if not legally. One case was conducted by the plaintiffs. Some, at least, of the difficulties which arose in this case would not have arisen save for the way in which the ambiguous agreement was drafted and the use of inappropriate precedents or earlier drafts by the vendor or the Service Company.

12 The defendants advocated a different result from the one I reached. The plaintiffs couched their declaration of entitlement in the alternative and its order for specific performance in favour of CG Maloney Pty Limited or its nominee.

13 There should only be one set of costs as essentially this was one action. The prudence of joining both plaintiffs arose out of their drafting an ambiguous agreement. The Notice of Exercise of Option could have been more explicit, but this is a minor point of little, if any, weight.

14 There is substance in the contention of the plaintiffs that the proposal of the defendants would create artificial difficulties of apportionment of the costs. This should be avoided as it will complicate any assessment of costs and increase the length and cost of it.

15 It is necessary to concentrate on the facts of the present case. On reconsidering the question of costs, the orders which would best meet the justice of the case and the practical exigencies of a taxation assessment are:

1. Discharge the order for costs made in Order 3 of paragraph 122 of my reasons for judgment of 22 June 2009.
2. Order that the defendants pay ninety per cent of the costs of the plaintiffs of these proceedings; there to be one set of costs allowed to the plaintiffs on an ordinary basis and that set of costs not to be increased by there being two plaintiffs.

16 I so order.

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