Charitopoulos v DJH Crowd Management (No 2) - [2009] SASC 241

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
CHARITOPOULOS & ORS v DJH CROWD MANAGEMENT (No 2)
[2009] SASC 241
Reasons of Judge Lunn a Master of the Supreme Court
14 August 2009
PROCEDURE - COSTS
Costs on an interlocutory order refusing extension of time for caveat to be payable forthwith - bankruptcy of a plaintiff and substitution of his trustee precluding any set off on costs - fixing party and party costs at a lump sum - process applicable - not reduction on amounts charged as between solicitor and own client but fixing amounts for items of work done - lump sum fixed.

CHARITOPOULOS & ORS v DJH CROWD MANAGEMENT (No 2)
[2009] SASC 241
Reasons on defendant’s applications for costs to be fixed as a lump sum and to be payable forthwith.

JUDGE LUNN:
Background.
Pantelis Charitopoulos, Marina Nikolakakis and Rosa Charitopoulos (“the initial plaintiffs”) instituted this action on 19 December 2008. The only relief sought in their summons was an extension of the time for the removal of a caveat which they had previously placed over land in South Australia owned by the defendant to secure repayment of an alleged loan by them to the defendant. The defendant is a company which carries on business in Victoria. It denies it was the borrower and has warned the caveat. On 19 December the initial plaintiffs took out an interlocutory application seeking an order for the extension of the caveat. At a hearing on 22 December I extended the caveat until 22 January 2009, gave directions for the filing of affidavits and set 20 January for the hearing of an argument about whether the caveat should be further extended. On 20 January I heard the argument and reserved my decision. I further extended the caveat until further order to allow me to consider my judgment. At a hearing on 11 February I discharged the order for the extension of the caveat but stayed the operation of the order until 16 February for the initial plaintiffs to consider whether they wished to appeal. I ordered that the initial plaintiffs were to pay to the defendant its costs of the interlocutory application as agreed or adjudicated upon. On 16 February I was informed there would be no appeal and I gave directions for the initial plaintiffs to extend their claim by filing a statement of claim seeking further relief other than the extension of the caveat.
In early May 2009 the first initial plaintiff, Pantelis Charitopoulos, was declared bankrupt and Phillip Aggs became his trustee in bankruptcy. On 26 May 2009 I gave permission to substitute that trustee for Pantelis Charitopoulos as the first plaintiff in the action. This was not done properly, but has been subsequently amended to make the action heading correctly read that it is between the initial plaintiffs up until 26 May 2009 and thereafter between Phillips Aggs, Marina Nikolakakis and Rosa Charitopoulos as plaintiffs and the defendant.
By an application of 16 June 2009 the defendant has…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2009] SASC 241
Decision Date: 14 August 2009

CaseChat Overview and Summary

In the matter of Charitopoulos v DJH Crowd Management (No 2), the court was asked to decide on costs associated with an interlocutory order. The initial plaintiffs, Pantelis Charitopoulos, Marina Nikolakakis, and Rosa Charitopoulos, had placed a caveat over land owned by the defendant to secure repayment of an alleged loan. The defendant, DJH Crowd Management, opposed the extension of the caveat. After several hearings, the court refused to extend the caveat and ordered the plaintiffs to pay the defendant's costs. Following the bankruptcy of one of the plaintiffs and the substitution of his trustee, the defendant sought to have the costs ordered to be payable forthwith and to be fixed at a lump sum.

The primary legal issues before the court were whether the costs should be payable forthwith and, if so, how they should be quantified. The court had to consider whether the circumstances warranted immediate payment of the costs, given the conclusion of the discrete issue of the caveat and the potential for a lengthy resolution of the principal proceedings. Additionally, the court needed to determine the appropriate method for fixing the lump sum for the costs, considering the bankruptcy of one of the plaintiffs, which precluded any set-off against future costs orders.

The court exercised its general judicial discretion to order that the costs be payable forthwith. It reasoned that the costs related to a concluded discrete issue, the principal proceedings were likely to be lengthy, and the bankruptcy of one plaintiff eliminated the possibility of set-off against future costs orders. In fixing the lump sum, the court applied a process that did not involve reducing the amounts charged between the solicitor and the client but rather determined the appropriate sum for the work done. The court fixed the lump sum for the costs accordingly.

The final orders included the direction that the costs ordered on 11 February in favour of the defendant be payable forthwith and that those costs be fixed at a lump sum as determined by the court.

Orders

Orders of the court

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Background

Background to the litigation

JUDGE LUNN:Background. Pantelis Charitopoulos, Marina Nikolakakis and Rosa Charitopoulos (“the initial plaintiffs”) instituted this action on 19 December 2008. The only relief sought in their summons was an extension of the time for the removal of a caveat which they had previously placed over land in South Australia owned by the defendant to secure repayment of an alleged loan by them to the defendant. The defendant is a company which carries on business in Victoria. It denies it was the borrower and has warned the caveat. On 19 December the initial plaintiffs took out an interlocutory application seeking an order for the extension of the caveat. At a hearing on 22 December I extended the caveat until 22 January 2009, gave directions for the filing of affidavits and set 20 January for the hearing of an argument about whether the caveat should be further extended. On 20 January I heard the argument and reserved my decision. I further extended the caveat until further order to allow me to consider my judgment. At a hearing on 11 February I discharged the order for the extension of the caveat but stayed the operation of the order until 16 February for the initial plaintiffs to consider whether they wished to appeal. I ordered that the initial plaintiffs were to pay to the defendant its costs of the interlocutory application as agreed or adjudicated upon. On 16 February I was informed there would be no appeal and I gave directions for the initial plaintiffs to extend their claim by filing a statement of claim seeking further relief other than the extension of the caveat. In early May 2009 the first initial plaintiff, Pantelis Charitopoulos, was declared bankrupt and Phillip Aggs became his trustee in bankruptcy. On 26 May 2009 I gave permission to substitute that trustee for Pantelis Charitopoulos as the first plaintiff in the action. This was not done properly, but has been subsequently amended to make the action heading correctly read that it is between the initial plaintiffs up until 26 May 2009 and thereafter between Phillips Aggs, Marina Nikolakakis and Rosa Charitopoulos as plaintiffs and the defendant. By an application of 16 June 2009 the defendant has applied under 6R 265 that the costs ordered on 11 February in its favour be payable forthwith and that those costs be fixed under 6R 264 at a lump sum.Costs payable forthwith. I consider that the Court should order the costs to be payable forthwith on the exercise of a general judicial discretion for the following reasons: Firstly, the costs relate to a discrete issue in the action which has been concluded: Alsom Power Ltd v Yokogawa Australia Pty Ltd (No 2) (2006) 243 LSJS 65. Secondly, the statement of claim filed on 27 April 2009 raises substantial issues which are contested by the defendant. It is likely to take considerable time for these issues to be resolved and for the principal proceedings to be concluded. Thirdly, one of the reasons for interlocutory costs not being payable immediately is because of the possibility of other interlocutory costs orders being made in the action in favour of the plaintiffs and there being a set-off between such orders: H Stanke & Sons Pty Ltd v von Stanke (No 2), White J, 16 May 2007, [2007] SASC 109. The bankruptcy of the first initial plaintiff means there cannot be any set-off against costs orders made in the future in favour of the present plaintiffs.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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