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Dale v Clayton Utz (No 3)

Dale v Clayton Utz (No 3)

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Case Copied 22 November 2013 26 min read

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT ARBITRATION LIST

No 4655 of 2011

CHRISTOPHER ANTONY DALE	Plaintiff
V
CLAYTON UTZ (a firm)	Defendant

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JUDGE:	HOLLINGWORTH J
WHERE HELD:	Melbourne
DATE OF HEARING:	5 August 2013 (Further written submissions received on 19 and 26 August, and 2 September 2013)
DATE OF JUDGMENT:	22 November 2013
CASE MAY BE CITED AS:	Dale v Clayton Utz (No 3)
MEDIUM NEUTRAL CITATION:	[2013] VSC 593

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PRACTICE & PROCEDURE – Costs – Interlocutory application to restrain party from retaining lawyer – Application successful – Whether costs should be ordered in favour of successful applicant – If so, whether there should be any exceptions to the costs order – Whether costs should be taxed immediately – Costs ordered to be paid without exception and taxed immediately – Supreme Court (General Civil Procedure) Rules 2005 rr 63.20, 63.20.1, 63.22 and 63.90.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr I Martindale SC	O’Donnell Salzano Lawyers
For the Defendant	Mr P Riordan SC Mr N De Young	Minter Ellison

HER HONOUR:

Introduction

Christopher Dale was, for many years, a partner in the solicitors’ firm of Clayton Utz. In October 2005, Clayton Utz terminated Mr Dale’s partnership. In September 2011, Mr Dale issued this proceeding, in which he claims that, in deciding to expel him, his former partners acted unlawfully and in breach of the partnership agreement.

By paragraph 1 of a summons dated 14 February 2012, Mr Dale sought an order restraining Clayton Utz from continuing to retain Allan Myers QC as their counsel in this proceeding.[1] That application had a rather complex and protracted path to determination.
[1]Paragraph 2 of the summons seeks an order striking out large parts of the defence, on various grounds. The strike out application has not been pursued before me.

After Randall As J had determined a number of disputes about subpoenas, and the admissibility of the parties’ affidavits, the injunction application was referred to me for hearing.

A preliminary issue arose as to whether Clayton Utz should be permitted to cross-examine Mr Dale during the hearing of the injunction application. On 29 November 2012, I granted limited leave to cross-examine Mr Dale.[2]
[2]Dale v Clayton Utz [2012] VSC 577 (“the first reasons”).

After hearing the substantive application in late January 2013, on 26 March 2013 I granted an injunction to restrain Clayton Utz from retaining Mr Myers in this proceeding.[3]
[3]Dale v Clayton Utz (No 2) [2013] VSC 54 (“the second reasons”).

There are now the following disputes about the costs of the injunction application:

(a) Mr Dale seeks an order that Clayton Utz pay his costs of the application, including reserved costs;

(b) Mr Dale seeks an order that those costs be taxed immediately;

(c) Clayton Utz says that the costs of the application should be costs in the proceeding;

(d) Alternatively, Clayton Utz says that if the court is minded to make a costs order in favour of Mr Dale,…

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: [2013] VSC 593
Decision Date: 22 November 2013

CaseChat Overview and Summary

The matter before the court involved an application by Dale against Clayton Utz, a firm of lawyers, to restrain them from retaining another lawyer in relation to an ongoing dispute. The application was heard in the Supreme Court of New South Wales. The primary issue before the court was whether costs should be awarded to Dale, the successful party in the interlocutory application. A secondary issue was whether there should be any exceptions to the costs order and if the costs should be taxed immediately.

The court considered the relevant provisions of the Supreme Court (General Civil Procedure) Rules 2005 and held that the successful applicant was entitled to costs. The court noted that the Rules permitted the awarding of costs to the successful party in such applications and did not provide for any exceptions. The court further found that the costs should be taxed immediately, as provided for in the Rules. The court took into account the importance of ensuring that legal costs are not unreasonably withheld and that the party who benefits from the outcome should bear the costs.

The court ordered that the costs of the application be paid by Clayton Utz to Dale without any exception and that the costs be taxed immediately. This decision reinforces the principle that the successful party in an interlocutory application is entitled to costs and that these costs should be determined and paid promptly, in accordance with the relevant provisions of the Supreme Court (General Civil Procedure) Rules 2005.

Orders