Caboche v England (No.3) No. Scgrg-93-92516 Judgment No. S6790
[1998] SASC 6790
•6 August 1998
RE: SOUTHERN EQUITIES CORPORATION LTD (IN LIQUIDATION)
CABOCHE v ENGLAND (No.3)
Civil
Debelle J (Ex Tempore)
The liquidator applies for an order that Ms Caboche pay his costs on a solicitor and client basis. In approaching this matter I have regard to the relevant principles which are conveniently noted in the reasons of Sheppard J in Colgate Palmolive Co. Pty Ltd v Cussons Pty Ltd (1993) 46 FCR 225 and in particular at pages 232 to 234. I have particular regard to the fact that the ordinary rule is that, where the court orders the costs of one party to be paid by another, the order is for payment of those costs on a party and party basis. That has been the settled practice for centuries as Sheppard J notes. Thus, there must be circumstances which warrant the court from departing from the usual course.
For the reasons which follow, it is, in the particular circumstances of this case, appropriate to order Ms Caboche pay the liquidator’s costs on a solicitor and client basis. The factors to which I have had regard which justify departing from the usual course that the payment of costs should be on a party and party basis are:
1...... Ms Caboche has failed in an earlier attempt to challenge the order for examination. She was, in this case, re-litigating issues which had already been determined against her in the earlier litigation. As Mr Cudmore properly submits, the history of this matter should not necessarily lead to an order granting the liquidator’s application, particularly given that, in his reasons for judgment, Lander J referred to the need for the court to be alert to ensure that the rights of an examinee were not being unjustly impaired and the need for vigilance in compliance with provisions of Corporations Law. The fact nevertheless remains that Ms Caboche was re-litigating an issue which has already been determined against her. It is relevant to have regard to that for the purpose only of noting she had earlier failed on that question.
2...... These orders were sought by the liquidator because Ms Caboche has failed to honour her undertaking to produce documents, that undertaking being given on 24 November, 1997.
3...... The liquidator’s application was made because of the failure of Ms Caboche to produce the documents. As has been noted in my reasons, Ms Caboche produced some documents but failed to produce either the Carindale documents or the superannuation documents. It is clear that she was aware of the obligation imposed upon her by her undertaking.
4...... The liquidator’s application sought no more than a resumption of an examination which had been adjourned to a date to be fixed and the production of the Carindale documents and the superannuation documents before that hearing.
In the period of more than six months which has elapsed since Ms Caboche originally gave the undertaking, she has not sought to object to her production of documents or to proffer any reason for failing to produce the documents or sought to be relieved from her undertaking. I repeat, what I said in my reasons for judgment that, for over six months she has sat on her hands and done nothing. Only when the liquidator took steps to seek orders to have her comply with the undertaking did she object to the production of the documents. She proffers no explanation for the delay. Neither does she proffer any explanation for failing to respond to the several letters of Fisher Jeffries seeking production of the documents. If there had been a proper objection, the time to have made it was substantially sooner than a response to the liquidator’s application for the resumption of hearing and production of the documents.
6...... The observations in the previous paragraph are reinforced by the fact that the appeal, so far as it related to Carindale documents, was to seek to canvass the ruling made by Judge Bowen Pain on 24 November, 1997 that the questions concerning Carindale Land Corporation Pty Ltd were an examinable affair. Ms Caboche did not appeal from that ruling. She had ample opportunity in which to do so.
7...... Although I have not had regard to it for the purpose of disposing of the merits of the appeal, the 11th hour nature in the application is, I think, a relevant factor when considering the basis upon which costs should be paid. It is a pointer to the fact that this was another attempt to delay the liquidator in pursuing his legitimate enquiry.
8...... Had proper consideration been given to the matter, it would have been realised that this was a hopeless case. As I mentioned in my reasons for judgment, all that had been sought by the liquidator was a resumption of the hearing and an order that Ms Caboche comply with the undertaking, which for six months she had failed to honour. It would have been clear also that the production of the accounts of Carindale was a legitimate aspect of an enquiry into an examinable affair. Indeed, as I note in my reasons for judgment, Mr Cudmore, who appeared for Ms Caboche at the examination, then acknowledged that an enquiry as to the capacity of the defendant to satisfy the judgment came within the ambit of an examinable affair.
9...... Although Ms Caboche had resisted the production of the superannuation documents, she abandoned that objection in the course of the hearing. That is a further pointer to the fact that proper consideration of the matter would have resulted in a conclusion this was a hopeless case.
An order as to costs should not be used as some kind of penalty. Its purpose must always remain that of providing fair recompense to a successful party having regard to the general principles to which Sheppard J refers in Colgate Palmolive Co Pty Ltd v Cussons Pty Ltd (supra). The determination of the basis upon which the order of costs should be made might be affected by the late prosecution of what is a hopeless or unmeritorious case. This always was such a case. This always was a hopeless and unmeritorious case and was prosecuted at an extremely late stage.
For all those reasons there will be an order that Ms Caboche pay the liquidator costs as reasonably incurred on a solicitor and client basis.
On a prior occasion I had reserved generally the question of costs.
There will be orders that Ms Caboche pay the liquidator's costs of and incidental to the application for leave to set aside the order of 10 July 1998, of the application for a stay of the order or for an extension of time within which to comply with the order, and of the application for an extension of time within which to appeal against the order, and the costs of the appeal, such costs to be paid either taxed or agreed on a solicitor and client basis. I also order that Ms Caboche not have her costs of the application for an extension of time within which to appeal.
There will be a further order that time within which to appeal will commence as of Monday last.