PRACTICE AND PROCEDURE – Costs – Appeal – First and second appellants partly successful – Third appellant wholly successful – Costs of appeal – Costs of trial – Apportionment of costs – Applicable principles – Whether costs should be awarded on indemnity basis – Whether respondents ought to have known that third appellant’s appeal would inevitably succeed – Whether first and second appellants ought to have known that their appeal would inevitably fail – Whether Calderbank offer unreasonably rejected.
PRACTICE AND PROCEDURE – Mareva injunction – Undertaking as to damages – Third appellant wholly successful on appeal – Trial judgment should not have been entered – Basis for Mareva injunction removed – Third appellant’s claim for damages caused by grant of injunction – Whether claim can be entertained by appeal court.
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APPEARANCES:
Counsel
Solicitors
For the Appellants (David Weiping Chen and Renmin Lu)
Mr W Alstergren with Mr D C Turner
Piper Alderman
For the Appellant (Lujia Chen)
Ms C M Kenny SC
D L A Phillips Fox
For the Respondents
Mr M R Simon
Chadwicks
MAXWELL P
REDLICH JA
FORREST AJA:
On 19 December 2008, we published our reasons in the appeals by David Weiping Chen (‘DWC’), Renmin Lu Chen (‘RLC’) and Lujia Chen (‘LC’).[1]
On 13 March 2009, submissions were made by the parties as to appropriate orders as to costs. The making of orders as to costs is complicated by the diversity of the matters raised on appeal and the mixed success enjoyed by the parties on appeal.
The trial transcript and the reasons of the trial judge demonstrate that it was the counterclaim, rather than the claim brought by the Chans and Eastworld International (Australia) Pty Ltd (‘EWA’) (the respondents to the appeals), which was the primary focus of the trial. LC was not a party to the counterclaim. As we noted in our reasons, success on the part of DWC and RLC on the counterclaim (which asserted the existence of three separate agreements) would have defeated the claim of the respondents, as well as giving DWC and RLC a half interest in the Toorak property.[2]
[2]Ibid [30]-[35].
But the counterclaim failed. And, on the appeal, DWC and RLC abandoned their attack on the findings of the trial judge in respect of their counterclaim.[3] A substantial part of the appeal was occupied by arguments…
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
AGLC
Chen v Chan [2009] VSCA 233
Case
[2009] VSCA 233
Decision Date
CaseChat Overview and Summary
The case of Chen v Chan involved the first, second, and third appellants, who were all parties to an appeal concerning the apportionment of costs. The respondents were also parties to the appeal. The dispute centred around the costs incurred during both the trial and the appeal, specifically whether these costs should be awarded on an indemnity basis. The third appellant was wholly successful in the appeal, whereas the first and second appellants were only partly successful. The court was required to decide whether the respondents should have been aware that the third appellant's appeal would inevitably succeed, and whether the first and second appellants should have known that their appeal would inevitably fail. Additionally, the court needed to determine if the respondents unreasonably rejected a Calderbank offer, which is a settlement offer made with a view to avoiding the costs of further proceedings.
The court examined the principles applicable to the apportionment of costs in appeals, particularly in cases where parties are only partly successful. The court considered whether the respondents should be penalised with indemnity costs due to their lack of awareness that the third appellant's appeal would succeed. The court also looked into whether the first and second appellants should be penalised due to their failure to foresee the inevitable outcome of their appeal. Furthermore, the court assessed whether the respondents' rejection of a Calderbank offer was unreasonable, which could have influenced the costs awarded.
In its reasoning, the court found that the third appellant was wholly successful in the appeal, and therefore, the trial judgment should not have been entered as the basis for the Mareva injunction was removed. The court decided that the third appellant's claim for damages caused by the grant of the injunction could not be entertained by the appeal court. The court concluded that the respondents should not be penalised with indemnity costs, as they could not have reasonably foreseen the success of the third appellant's appeal. Similarly, the first and second appellants were not penalised for their failure to foresee the outcome of their appeal, as the court found that their appeal was not bound to fail. The court also found that the respondents did not unreasonably reject the Calderbank offer.
The court ordered that the costs of the appeal should be apportioned among the parties in a manner that reflected their respective degrees of success. The court did not award indemnity costs to the third appellant, nor did it penalise the first and second appellants for their unsuccessful appeal. The court also did not entertain the third appellant's claim for damages caused by the grant of the Mareva injunction.