Clone Pty Ltd v Players Pty Ltd - [2019] SASC 47

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
CLONE PTY LTD v PLAYERS PTY LTD & ORS
[2019] SASC 47
Reasons for Ruling of Auxiliary Judge Norman a Master of the Supreme Court
21 March 2019
PROCEDURE - COSTS - TAXATION
"Amendment" - "Costs in the cause" - "Costs thrown away"
Supreme Court Rules 1987 rr 53.11 and 101.02, referred to.
Fashion Warehouse Pty Ltd v Pola [1984] 1 Qd R 251; Laing O'Rourke (BMC) Ltd (formerly Barclay Mowlem Construction Ltd v Dampier Port Authority [2007] WASC 87; Fitzgerald & Anor v CBL Insurance Ltd (No 2) [2015] VSC 176; Brookvista Pty Ltd v Meloni [2009] WASCA 180; Simmons v Love (No 2) [2016] WASC 167; Edelman v Badower [2010] VSC 427; Ashwin v Minara Resources Ltd (No 2) [2010] WASC 330; EMI Records Ltd v Ian Cameron Wallace Ltd [1983] Ch 59; Hannover International Ltd v C W Robson; Mine & Quarry Equipment International v C W Robson, G F Robson v C W Robson [2012] QSC 47, considered.

CLONE PTY LTD v PLAYERS PTY LTD & ORS
[2019] SASC 47

This is a ruling on an adjudication of the plaintiff’s costs of the original trial in these proceedings.
Mr Ericson is representing the plaintiff and Mr Cogan is representing the seventh, eighth and tenth defendants.
In item 1723 of the plaintiff’s Bill of Costs it claims $112 for an attendance on 6 July 2004 for perusing proposed changes to the amended statement of claim. The document perused is seven pages long and the relevant provision is Scale Item 5 of the Tenth Schedule to the then Supreme Court Rules.
I heard submissions on 19 March 2019 and reserved my decision.
It is clear that the ruling will affect a number of other times in the bill.
Background
It appears that the amendment, at least in part, was necessitated by facts and events occurring subsequent to the issue of the proceedings. During the hearing before Judge Bowen Pain when leave to amend was sought, Mr McNamara QC, counsel for the plaintiff, told the court (at transcript page 32) that the first defendant had been in breach of its lease of the premises from the plaintiff and that its recent conduct had provoked the plaintiff to scrutinise its degree of compliance with the lease in close detail. He said that inspections that had occurred were “flushing out” those breaches. He indicated that the plaintiff was conscious that this had created a procedural difficulty for the court, but at the same time he said it was essential that it be seized of all issues between the parties.
Mr Tisato, counsel for the defendants, responded that the matters raised by Mr McNamara might result in further amendments to the pleadings. He expressed concern that there were continuing suggestions of amendments during the interlocutory process.
At page 42.25, Judge Bowen Pain dealt with the application.
One; I give leave to the plaintiff to file and serve a further…

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.

Continue reading Clone Pty Ltd v Players Pty Ltd

Details

AGLC: Clone Pty Ltd v Players Pty Ltd [2019] SASC 47
Case: [2019] SASC 47
Decision Date: 21 March 2019

CaseChat Overview and Summary

The case of Clone Pty Ltd v Players Pty Ltd involved a dispute over costs incurred during the course of litigation, specifically concerning the taxation of a bill of costs submitted by the plaintiff. The case was heard and determined in the Supreme Court of Queensland. The central issue before the court was whether the plaintiff was entitled to recover costs associated with amendments to its pleadings that were necessitated by new facts discovered after the original pleadings were issued.

The court was required to decide whether the costs incurred due to amendments necessitated by new facts should be classified as "costs thrown away" or "costs in the cause." The plaintiff argued that the costs of amendments due to new facts should not be considered "costs thrown away" because they were not the result of error or failure to comply with procedural rules. Instead, the plaintiff contended that such costs should be classified as "costs in the cause." The defendants, on the other hand, maintained that all costs thrown away due to amendments should be borne by the party that made the amendments.

The court considered the legal principles set out in previous cases such as EMI Records Ltd v Ian Cameron Wallace Ltd and Hannover International Ltd v C W Robson. It was noted that costs thrown away typically compensate for work wasted due to the other party's error or failure to comply with rules, whereas costs for amendments due to new facts could be considered costs in the cause. However, the court found that Judge Bowen Pain had clearly intended for the defendants to recover all costs thrown away as a result of the amendments, without any qualification regarding the nature of those costs. The court concluded that it would be inappropriate to overturn Judge Bowen Pain's order and that the plaintiff could not recover the costs associated with the amendments it made.

The court ordered that the sum of $112, being item 1723 of the plaintiff's bill, be taxed off, as it represented costs associated with the amendments that the plaintiff was not entitled to recover.

Orders

Orders of the court

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Background

Background to the litigation

It is clear that the ruling will affect a number of other times in the bill.Background It appears that the amendment, at least in part, was necessitated by facts and events occurring subsequent to the issue of the proceedings. During the hearing before Judge Bowen Pain when leave to amend was sought, Mr McNamara QC, counsel for the plaintiff, told the court (at transcript page 32) that the first defendant had been in breach of its lease of the premises from the plaintiff and that its recent conduct had provoked the plaintiff to scrutinise its degree of compliance with the lease in close detail. He said that inspections that had occurred were “flushing out” those breaches. He indicated that the plaintiff was conscious that this had created a procedural difficulty for the court, but at the same time he said it was essential that it be seized of all issues between the parties. Mr Tisato, counsel for the defendants, responded that the matters raised by Mr McNamara might result in further amendments to the pleadings. He expressed concern that there were continuing suggestions of amendments during the interlocutory process. At page 42.25, Judge Bowen Pain dealt with the application.One; I give leave to the plaintiff to file and serve a further amended statement of claim in the form initialled by me within 24 hours At page 43.20 he asked Mr McNamara as to the costs of the application:His Honour: You are going to have to pay the costs of the defendants thrown away as a result of the amendments, are you not?”Mr McNamara: Yes.His Honour: Five; the plaintiff to pay the costs of the defendants, thrown away, as a result of the amendments; otherwise costs in the cause.Defendants’ submissions Mr Cogan objected to the claim for this item on the basis that when Judge Bowen Pain gave leave to the plaintiff to amend the statement of claim on 6 July 2004, (see transcript of that hearing at pages 42-43), he ordered that it was to pay the costs of the defendants thrown away as a result of the amendments, and otherwise costs in the cause. Mr Cogan’s contention was that because the defendants were awarded the costs on this issue, it was accordingly inappropriate for the plaintiff itself to recover any costs concerning its amendments.Plaintiff’s submissions Mr Ericson submitted that the expression “costs thrown away” should not include the costs of an amendment occasioned by the receipt of new information from the plaintiff subsequent to the issue of the original proceedings. He contended that costs of such an amendment were to be treated differently from costs thrown away.Amendment Rules The relevant rules in force at the time of the work undertaken were the Supreme Court Rules 1987. Rule 101.02(1) provided that subject to the rules, the costs of and incidental to a proceeding should follow the event unless the court otherwise ordered. Subrule (2) provided: (2)Unless the Court otherwise orders, the costs of and occasioned by:(a) an amendment made pursuant to Rule 53 shall be borne to the extent provided by Rule 53.11 by the party making the amendment; …

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

In EMI Records Ltd v Ian Cameron Wallace Ltd [1983] Ch 59 at 74, the court held that in determining reasonableness the receiving party would be given the benefit of the doubt, and considerable liberality should ordinarily be extended in assessing reasonableness. See also Hannover International Ltd v C W Robson; Mine & Quarry Equipment International v C W Robson; G F Robson v C W Robson [2012] QSC 47.Consideration Essentially, Mr Ericson’s submission in support of this client’s claim is that the expression “costs thrown away” is linked to a situation where the beneficiary of the order is reimbursed for costs incurred for work done but wasted as a result of the other party’s error, or its failure to comply with the procedure set by the rules. However in the case of an amendment to a pleading that is not occasioned by waste or error, but rather was necessitated by a change in circumstances or the ascertainment of new facts, he said, the costs incurred should not be classified as “costs thrown away” and should be quarantined from that order. It would not be appropriate, he submitted, for that part of the costs linked to that situation to be the subject of the order. The learned authors of Quick on Costs and Dal Pont’s Law of Costs provide some support to Mr Ericson’s argument, as they both indicate that an order for costs thrown away is regarded as compensation for work already done but wasted as a result of the other party’s error or failure to comply with the procedures set by the rules, but that if instead an amendment is occasioned because of a new or intervening fact which could not reasonably be anticipated - for example, because it was made necessary by events after issue of the pleading - it may be appropriate to make the costs of the amendment costs in the cause. However, the difficulty I see in this instance is that Judge Bowen Pain clearly intended in his order that the defendants would recover all costs thrown away as a result of the amendments. He used the expression “as a result of the amendments” on two occasions, and Mr McNamara conceded that this would be the appropriate order. Judge Bowen Pain did not, in any manner or form, qualify that order so as to quarantine those parts of the costs not resulting from the plaintiff’s error or failure to comply with the procedure set by the rules. Had the plaintiff wanted to avoid the effect of an order for costs thrown away, it could at the time have sought orders from Judge Bowen Pain quarantining those costs which resulted from change in circumstances or facts since the original pleading, and ruling that those be costs in the cause, or something similar. However, it did not do so. If I were to make a ruling in favour of the plaintiff on this issue, this would have the effect of partly overturning Judge Bowen Pain’s order, and would be inappropriate. In the circumstances, by reason of Judge Bowen Pain’s order awarding costs thrown away by reason of the amendments to the defendants, the plaintiff cannot itself recover costs associated with the amendments it made, so I will accordingly rule that the sum of $112, being item 1723 of the plaintiff’s bill, be taxed off.