Calarco v Liverpool City Council (No. 2)

[2018] NSWSC 355

Supreme Court

New South Wales

Medium Neutral Citation:	Calarco and Anor v Liverpool City Council (No. 2) [2018] NSWSC 355
Hearing dates:	On the papers
Date of orders:	21 March 2018
Decision date:	21 March 2018
Jurisdiction:	Common Law - Administrative Law
Before:	Johnson J
Decision:	1. Defendant to pay interest on Plaintiffs’ pre-judgment and post-judgment costs.  2. Parties to bring in short minutes by 11.00 am on 23 March 2018 to give effect to this judgment.
Catchwords:	COSTS - claim for interest on costs - pre-judgment and post-judgment costs - power compensatory and not punitive - order to be made for payment of interest on pre-judgment and post-judgment costs
Legislation Cited:	Land Acquisition (Just Terms Compensation) Act 1991
Cases Cited:	Calarco and Anor v Liverpool City Council [2018] NSWSC 217 Lahoud v Lahoud [2006] NSWSC 126
Texts Cited:	---
Category:	Costs
Parties:	Giuseppe Calarco and Antonetta Calarco (Plaintiff) Liverpool City Council (Defendant)
Representation:	Counsel: Mr P Tomasetti SC; Mr J Johnson (Plaintiff) Mr R Lancaster SC; Dr JV Smith (Defendant)   Solicitors: DC Balog & Associates (Plaintiff) HWL Ebsworth Lawyers (Defendant)
File Number(s):	2016/250023
Publication restriction:	---

Judgment

1. JOHNSON J: On 28 February 2018, the Court gave judgment in these proceedings: Calarco and Anor v Liverpool City Council [2018] NSWSC 217. At the conclusion of that judgment (at [104] and [105](e)), I provided the Plaintiffs with an opportunity to furnish written submissions in support of their claim for an order that the Defendant pay interest on costs.

2. Written submissions have been made on behalf of the Plaintiffs and the Defendant with respect to this issue. The Plaintiffs make application for an order for payment of interest on costs and the Defendant opposes the making of such an order.

3. In support of the application, the Plaintiffs rely upon the affidavit of Giuseppe Calarco sworn 6 March 2018 in which he states that legal costs in the sum of $109,817.02 have been incurred to date with respect to these proceedings. Mr Calarco states that he paid the costs immediately upon receipt of invoices from his lawyers.

Submissions of the Parties

4. Mr Tomasetti SC, for the Plaintiffs, submitted that it is appropriate for the Court to make the order which is sought as a form of compensation for the costs of the proceedings in relation to which the Plaintiffs have been out of pocket: Lahoud v Lahoud [2006] NSWSC 126 at [83].

5. The written submissions on behalf of the Defendant traverse the history of the proceedings in support of an argument that the Court should not exercise its discretion to award the Plaintiffs interest on costs for the period before 28 February 2018. In the alternative, the Defendant submits that if an order for interest on costs is to be made, it should operate only from 23 November 2016, the date upon which the Defendant determined finally the Plaintiffs’ hardship application as it was that determination which was the subject of the hearing in this Court. Finally, the Defendant submitted that, if an order was to be made for any period before 28 February 2018, the pre-judgment interest rate of four per cent of the latest cash rate published by the Reserve Bank from time to time ought to be applied for that period and not the post-judgment interest rate.

6. In reply, Mr Tomasetti SC submitted that the Plaintiffs should have an order for interest on costs with respect to the entirety of the proceedings which they were required to commence to enforce their hardship claim under the Land Acquisition (Just Terms Compensation) Act 1991. He submitted that the Plaintiffs had been fully vindicated by the decision of the Court and that the Plaintiffs should be restored to the position they would have been in had the proceedings not been necessary. It was submitted that the precise quantum ought be determined by agreement or by Court supervised assessment if necessary.

7. The Plaintiffs submitted that the proper interest rate to be applied is four per cent above the cash rate for costs incurred pre-judgment and six per cent for costs incurred post-judgment. As to the date for the payment of interest, it was submitted for the Plaintiffs that liability should run from the date of payment of the relevant bill to the date of reimbursement by the Defendant to the Plaintiffs.

Decision

8. The Plaintiffs commenced proceedings against the Defendant in this Court by Summons filed on 19 August 2016. An Amended Summons was filed on 20 January 2017 and it was that claim for relief which was heard and determined by the Court.

9. The final and operative decision of the Defendant for the purpose of the proceedings was the decision of the full Council of the Defendant made on 23 November 2016 which rejected the Plaintiffs’ hardship application with respect to that part of the Austral property which was zoned “SP2 Infrastructure” in the form of “Local Drainage”: Calarco and Anor v Liverpool City Council at [8]-[13].

10. Although it was the final decision of the Defendant made on 23 November 2016 which was the focal point of the hearing in this Court, the fact was that the Plaintiffs had been required to commence proceedings in this Court following the Defendant’s initial decision which was confirmed by the decision made on 23 November 2016.

11. The present application should be approached upon the basis that, if an order for payment of interest on costs is made, it is reasonable that it operate from the date when proceedings were commenced in this Court and not 23 November 2016.

12. The power to order payment of interest on costs is compensatory and not punitive. There is no requirement, before an order for payment of interest on costs is made, for the Court to be satisfied that the circumstances of the case are out of the ordinary: Lahoud v Lahoud at [82].

13. I am satisfied that the Plaintiffs have been out of pocket as a result of having to pay their lawyers’ costs and disbursements for the purpose of these proceedings. It was necessary for the Plaintiffs to commence proceedings in this Court to enforce their entitlement to proper and appropriate payment from the Defendant for the Austral property by application of the hardship provisions in the Land Acquisition (Just Terms Compensation) Act 1991.

14. I am satisfied that it is appropriate that the compensation which is recognised in the Court’s order for costs take into account the fact that the Plaintiffs have been out of pocket as a result of having to pay their lawyers’ costs and disbursements as they fell due: Lahoud v Lahoud at [83].

15. The Plaintiffs’ claim for relief in this Court arose from their financial hardship, the existence of which was accepted by the Defendant.

16. I am satisfied that the Plaintiffs are entitled to an order for payment of interest on costs with respect to both pre-judgment and post-judgment periods. In circumstances where the litigation itself arose from financial hardship experienced by the Plaintiffs, it is appropriate to compensate the Plaintiffs for costs incurred by them for the purpose of obtaining their lawful entitlements against the Defendant under the Land Acquisition (Just Terms Compensation) Act 1991.

17. For the purpose of this order, the pre-judgment interest rate ought be four per cent above the cash rate for costs incurred pre-judgment and six per cent for costs incurred post-judgment.

18. I will make an order that the Defendant pay the Plaintiffs’ interest on costs at these rates with liability to run from the date of payment by the Plaintiffs to their legal representatives of the relevant bill to the date of reimbursement of the Plaintiffs by the Defendant.

19. The parties should bring in short minutes by 11.00 am on Friday, 23 March 2018 (by email communication with my Associate) to give effect to this judgment.

**********

Decision last updated: 21 March 2018