Cann v Commonwealth Bank of Australia (No.7)
[2011] FMCA 1004
•16 December 2011
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| CANN v COMMONWEALTH BANK OF AUSTRALIA (No.7) | [2011] FMCA 1004 |
| BANKRUPTCY – Application for review of sequestration order made by Registrar – application dismissed – indemnity costs – quantum. COSTS – Indemnity costs – quantum. |
| Bankruptcy Act 1966 (Cth), s.109 |
| Cann v Commonwealth Bank of Australia (No.5) [2011] FMCA 768 Co-operative Bulk Handling v Ballato & Ors (unreported, Supreme Court of Western Australia, CIV 2401/1987, 25 October 1991) Latoudis v Casey (1990) 170 CLR 534 |
| Applicant: | GAVIN MICHAEL CANN |
| Respondent: | COMMONWEALTH BANK OF AUSTRALIA |
| File Number: | PEG 2 of 2011 |
| Judgment of: | Lucev FM |
| Hearing date: | On written submissions |
| Date of Last Submission: | 8 December 2011 |
| Delivered at: | Perth |
| Delivered on: | 16 December 2011 |
REPRESENTATION
| For the Applicant: | No written submissions filed |
| Solicitors for the Respondent: | Written submissions from Clayton Utz |
ORDERS
That the respondent’s costs in the sum of $30,000 be paid from the applicant’s bankrupt estate in the priority afforded by the Bankruptcy Act 1966 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT PERTH |
PEG 2 of 2011
| GAVIN MICHAEL CANN |
Applicant
And
| COMMONWEALTH BANK OF AUSTRALIA |
Respondent
REASONS FOR JUDGMENT
Background
In Cann v Commonwealth Bank of Australia (No.5)[1] the Court dismissed Mr Cann’s application for review of a sequestration order made against him by a Registrar of this Court.
[1] [2011] FMCA 768
In Cann v Commonwealth Bank of Australia (No.6)[2] the Court considered the basis on which this Court might award costs in the matter, and concluded that the respondent, the Commonwealth Bank of Australia,[3] was entitled to its costs on an indemnity basis. The Court however ordered that both parties file further submissions as to the quantum of indemnity costs.
[2] [2011] FMCA 912 (“Cann (No.6)”).
[3] “CBA”.
Submissions
Mr Cann did not file any submissions.
CBA filed submissions, and claimed costs in the sum of $30,000 on the basis that:
a)CBA’s actual costs were $31,571.67 (this sum was not disputed);
b)the minimum costs if the matter had been assessed under the usual general federal law scale for costs in this Court would have been at least $15,832;[4] and
c)the usual costs in bankruptcy for this matter would have been $10,079.88.[5]
[4] Cann (No.6) at paras.20-22 per Lucev FM.
[5] Cann (No.6) at para.19 per Lucev FM.
Law
Indemnity costs are compensatory.[6] The party entitled to indemnity costs is to be given the benefit of the doubt when deciding whether its costs are unreasonable.[7]
[6] Latoudis v Casey (1990) 170 CLR 534 at 567 per McHugh J; Hamod & Anor v New South Wales & Anor (2002) 188 ALR 659 at 665 per Gray J; [2002] FCA 424 at para.20 per Gray J.
[7] Co-operative Bulk Handling v Ballato & Ors (unreported, Supreme Court of Western Australia, CIV 2401/1987, 25 October 1991, at page 4 per Nicholson J) (“Ballato”); EMI Records Ltd v Ian Cameron Wallace Ltd & Anor [1982] 2 All ER 980 at 989 per Megarry V-C (“EMI Records”).
Consideration
In determining the appropriate quantum of indemnity costs the Court has had regard to:
a)the total costs incurred by the CBA;[8]
b)this Court’s costs scales both in bankruptcy and under the usual general federal law scale, recognising that those costs might ordinarily only compensate for anywhere between 30% and 70% of the actual costs incurred by a successful party;
c)the matters which made an indemnity costs order appropriate, as set out in Cann (No.6):
[8] Ballato at page 3 per Nicholson J.
25. In determining whether to award indemnity costs, the Court has had regard to the totality of the course of these proceedings, but also, in particular, to the following factors:
a) the District Court litigation in relation to the judgment debt and associated matters which shows that Mr Cann was not a novice self-represented litigant;
b) allegations made by Mr Cann which ought not to have been made, particularly in relation to the asserted basis for impugning the District Court default judgment and for having that judgment set aside, and the fact that those allegations unduly prolonged the proceedings in this Court causing a loss of time for the Court and the CBA, and increased costs generally;
c) Mr Cann’s serial non-compliance with the orders of this Court;
d) Mr Cann’s making of unnecessary and flimsily based applications for adjournment on a number of occasions, which were ultimately unsuccessful, and which unduly prolonged proceedings, causing a loss of time and increased costs;
e) Mr Cann’s overall conduct of the proceedings, by way of both applications made and his conduct in Court, which caused delay in the resolution of the application for review by several months, for no particular or good purpose, and which sometimes bordered on the vexatious; and
f) the significantly increased costs of the proceedings arising from Mr Cann’s conduct of the proceedings, both to CBA and to the public purse.;[9]
d)the prudence shown by the CBA in being represented throughout by a lawyer from their firm of solicitors, rather than engaging independent counsel;[10] and
e)the considerable amount of time, and effort, that the CBA had to spend in preparation for, and attendances at, this Court, for what ought to have been a comparatively straightforward sequestration order review application, but which has resulted, essentially because of the conduct of Mr Cann, in this Court having to deliver seven judgments in the matter over a period of more than eleven months.
[9] Cann (No.6) at para.25 per Lucev FM.
[10] EMI Records at 990 per Megarry V-C.
In all the circumstances, the Court considers that $30,000 is not outside the range of costs which might have been incurred in relation to the matter, and the costs claimed are therefore not unreasonable.
Conclusion and order
The CBA is entitled to indemnity costs in the sum of $30,000. There will therefore be an order that the CBA’s costs, in the sum of $30,000, be paid from Mr Cann’s bankrupt estate in the priority afforded by the Bankruptcy Act 1966 (Cth).[11]
[11] Bankruptcy Act 1966 (Cth), s.109.
I certify that the preceding eight (8) paragraphs are a true copy of the reasons for judgment of Lucev FM
Date: 16 December 2011
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