Damiano v Dhaliwal (No 3)
[2024] ACTMC 24
•24 October 2024
MAGISTRATES COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Damiano v Dhaliwal (No 3) |
Citation: | [2024] ACTMC 24 |
Hearing Date: | 10 August 2022, 14 September 2023 |
Decision Date: | 24 October 2024 |
Before: | Magistrate Stewart |
Decision: | See paragraphs [41-43]. |
Catchwords: | CIVIL LAW – JURISDICTION, PRACTICE AND PROCEDURE – commercial lease, claim for costs and pre-judgment interests by successful counter-claimant, costs as a discretion only, costs not a punishment, discretion enlivened, Calderbank offers, pre-judgment interest and party and party costs awarded. |
Legislation Cited: | Leases (Commercial and Retail) Act 2001 (ACT), s144. Court Procedures Rules 2006 (ACT),rr1619. Magistrates Court of the Australian Capital Territory Practice Direction No 4 of 2007 Magistrates Court of the Australian Capital Territory Practice Direction Civil 2 1 July 2019 |
Cases Cited: | Calderbank v Calderbank [1975] All Er 333 Damiano v Dhaliwal [2021] ACTMC 14 Damiano v Dhaliwal [2023] ACTMC 36 EMI Songs Australia Pty Ltd v Larrakin Music Publishing Pty Ltd [2011] FCAFC 92 Hazeldene’s Chicken Farm Pty Ltd v Victorian Workcover Authority (No 2) [2005] VSCA 298 Kingsley’s Chicken Pty Ltd v Queensland Investment Corp (ACTMC, Magistrate Burns, 11 November 2005) Leda Commercial Properties Pty Ltd v Brenda Hungerford Pty Ltd [2018] ACTCA 17 Ruby v Marsh (1975) 132 CLR 642 |
Parties: | Marilena Damiano ( Applicant) Manjit Kaur Dhaliwal ( Respondent) |
Representation | Solicitors Self represented (applicant and respondent to counter-claim) Mr Donohue (defendant and counter-claimant |
File Number: | CL/24/2015 |
MAGISTRATE STEWART:
Introduction
1․ For the sake of ease I will refer to the parties by name in this decision.
2․ This matter has been on foot since 2015. The applicant, Ms Damiano, has been physically absent from the proceedings heard before me since the afternoon of 26 October 2021. Her application was struck out[i] on that day because after attending Court in the morning session she then failed to attend Court in the second part of the day to prosecute her claim.
3․ Ms Damiano has not appealed that decision.
4․ Ms Damiano did not appear on 10 August 2022 which was the date listed for the counter-claim to be heard. No legal practitioner filed a notice of appearance and a legal practitioner did not appear on Ms Damiano’s behalf.
5․ A timetable was set for the filing of submissions on the counter-claim, quantum, evidence and authorities in support of submissions. Ms Damiano did not file any submissions or engage a legal practitioner to do so on her behalf.
6․ The counter-claimant Ms Dhaliwal filed written submissions. Her counter-claim succeeded.[ii]
7․ Ms Damiano has not appealed that decision.
8․ Filing dates were then set by the Court to allow the parties to file submissions on costs. Those dates were 20 October 2023 for Ms Dhaliwal and 17 November 2023 for Ms Damiano.
9․ The solicitor for Ms Dhaliwal filed written submissions on 10 April 2024.
10․Ms Damiano did not file any submissions by 17 November 2023 or in response to those filed for Ms Dhaliwal on 10 April 2024.
11․A further opportunity was extended by the Court for Ms Damiano to file submissions on costs by the close of business Friday 18 October 2024 – more than six months after her opponent, the successful party to the litigation, had filed their submissions. Ms Damiano did not file any submissions on costs by that deadline.
Medical certificates
12․Ms Damiano has repeatedly forwarded medical certificates to the Court in an attempt to justify her non-participation since her application was struck out.
13․These were largely irrelevant as the Court set dates for written submissions so that both parties no longer had to attend Court. All that was required was submissions to be filed so that a final decision could be made. Either party was free to do that in person or by way of instructing a legal practitioner to do so on their behalf.
14․It is a matter of public record that Ms Damiano recently contested the Australian Capital Territory (ACT) election.[iii] In doing so Ms Damiano publicly demonstrated her recent capacity to either organise herself (or others on behalf of herself) to go through the process of standing for election.
15․The Court holds many emails directly from Ms Damiano. On 14 September 2023 I made an order to specifically stop her from unilaterally communicating with my chambers.
16․Contrary to the various medical certificates that Ms Damiano has submitted to the Court, all of the evidence in this matter shows a capacity to, at a bare minimum, communicate with and instruct a legal practitioner to submit written submissions on the issue of costs. However, on balance, I am left in no doubt that if Ms Damiano had chosen to confine her attention to the issues of costs, she was indeed capable of filing submissions on the topic herself.
17․In those circumstances, in my view, the Court should proceed to a decision in the absence of any submissions on Ms Damiano’s behalf.
Costs
18․Costs are not awarded as a punishment to an unsuccessful party. The sole purpose of costs is to compensate the successful party.[iv]
19․Costs are discretionary in the commercial lease jurisdiction with the general rule being that parties bear their own costs[v]:
LEASES (COMMERCIAL AND RETAIL) ACT 2001 - SECT 154
Costs
The parties in a proceeding under this Act must bear their own costs unless the Magistrates Court or Supreme Court makes an order about costs
The Court Procedures Rules[vi] and the Practice Direction (PD) create power to grant costs in appropriate circumstances.
20․The previous PD[vii] was in operation when Ms Damiano commenced these proceedings. It plainly set out the approach to costs in this jurisdiction:
COSTS
25. Failure of a party to an application to comply with orders or directions of the Court and any unreasonable delay by a party are examples of circumstances that may constitute cogent grounds justifying an order for costs in favour of the innocent party or parties.
26. Where the Court makes an order for costs pursuant to s 154, the Court adopts Part 2.17 of the CPR save for rules 1721, 1725, 1726, 1727 and in particular notes rules 1720, 1722, and 1723 regarding the fixing of an amount for the costs of a proceeding before the Court. Where the Court does not make an order for fixed costs, costs are to be assessed in accordance with Part 2.17 as appropriate.
21․The current PD[viii] came into effect on 1 July 2019, revoked the previous PD and provided a broader discretion for costs in the jurisdiction:
Compliance and costs
32. Parties and their representatives are reminded that the Court may award costs against a party or a representative for failure to comply with this practice direction, the CPRs or a direction of the Court, notwithstanding s 154 of the Act.
22․It is important to note that Ms Damiano is well aware of the power to award costs as there have been previous costs orders awarded against her in this matter.[ix]
23․There have also been three offers of compromise that Ms Damiano declined to accept.
24․The first offer was dated 14 March 2016 and was termed to be a Calderbank[x] offer. It detailed an offer to pay Ms Damiano $10,000 plus costs to resolve the matter. In my view that offer was generous and commercially sensible from the perspective of Ms Dhaliwal. It was also entirely reasonable. See Kingsley’s Chicken Pty Ltd v Queensland Investment Corp (ACTMC, Magistrate Burns [as he then was]), 11 November 2005 Unreported at [11].
25․The second offer was dated 5 January 2017 and was termed to be a Calderbank offer. It set out an offer to pay Ms Damiano $56,650 on the basis that she return to Ms Dhaliwal her books, records, stock and personal possessions from the rental premises. It was an extraordinarily generous offer to resolve the litigation and easily qualifies as being reasonable.
26․The third offer was dated 16 July 2020 and was termed to be a Calderbank offer. It stated:
Given that you have not taken any step in these proceedings since 30 April 2018, it appears that you do not intend to proceed with your claim against my client.
My client is prepared to settle this matter with you on the following terms:
1. You consent to your claim against my client being struck out;
2. You consent to an order that you pay my client’s costs assessed at one half of the applicable scale; and
3. My client will withdraw her claim against you.
This offer is made on the basis of Calderbank v Calderbank and if not accepted by you will be relied upon by my client in an application for costs from the date of this letter. This offer will remain open for acceptance by you for one month, being until 14 August 2020, after which I will be instructed to file the application to lift the stay, have your claim struck out with an order for the full amount of my client’s costs, and then proceed with the counter claim.
27․The offer was abundantly clear, both parties were well aware of the strengths and weaknesses of their cases (and in Ms Damiano’s case she was intimately aware of the extraordinary behaviour she herself took in locking Ms Dhaliwal out of the premises after refusing to allow her to assign the lease and, in, effect blocking her from proceeding with a negotiated sale of her restaurant business), the prospects of success for Ms Damiano’s case was objectively not strong, Ms Damiano had done little (or nothing) to further her claim for over two years, and the letter set out that costs would be sought in the ‘full amount’.[xi] In the circumstances of this matter the third offer was also reasonable.
28․Further, and in any event, I find that Ms Damiano’s conduct of the litigation has been so unreasonable that it also enlivens the costs discretion. Ms Dhaliwal is in a less favourable position to the landlord in the matter of Leda Commercial Properties Pty Ltd v Brenda Hungerford Pty Ltd [2018] ACTCA 17 at [123] in that she has been required to defend an unjustified, detailed and extensive claim against her. In Ms Dhaliwal’s case the injustice went further as the applicant was the genesis of significant delay and ultimately failed to prosecute her claim.
29․Further, it is difficult to rationalise that any lay person in Ms Dhaliwal’s position could have navigated Ms Damiano’s conduct of this matter without the assistance of an experienced legal practitioner.
30․I find that the discretion to award costs is enlivened pursuant to r 1722.
Ms Dhaliwahl’s submissions
31․Ms Dhaliwal seeks:
a. An order for pre-judgment interest in the sum of $24,220.75;
b. Ms Damiano to pay Ms Dhaliwal’s costs of the counter-claim; and
c. Ms Damiano to pay the further costs of Ms Dhaliwal’s for the period 14 March 2016 to 4 January 2017 in addition to the order of 26 October 2021.
Pre-judgment interest
32․The claim for interest is pursuant to r 1619 of the Court Procedures Rules on the judgment amount of $52,400.52 for the period commencing 20 February 2015 (the date that Ms Damiano took possession of the leasehold premises being the subject of the litigation) to 14 September 2023 (being the date of the decision on the counter-claim).
33․Interest is bound to be awarded to a successful party unless good cause is shown to the contrary.[xii] I see no arguable case against interest in this matter.
34․ The claim for interest in the sum of $24,220.75 as calculated by Ms Dhaliwal is allowed.
Costs of the counter-claim
35․For the reasons set out at paragraphs [18] – [30] above I allow costs for the counter claim. Ms Dhaliwal has not sought a departure from r 1751 and those costs are to be awarded on a party and party basis.
36․Because the judgment amount was greater than $50,000 costs are to be 100% of Ms Dhaliwal’s costs on the Supreme Court scale – see r 1723(2)(b) and r 1722.
Costs between 14 March 2016 and 4 January 2017
37․These submissions relate to a period of time not covered by previous costs order made by me on 26 October 2021.
38․Through error, the solicitor for Ms Dhaliwal had not seen the first letter of offer dated 14 March 2016 when preparing for the hearing of Ms Damiano’s claim. As a result, it was not a feature of the costs order made as a consequence of Ms Damiano’s claim failing.
39․In those circumstances of genuine error and the absence of any submissions or objection to the contrary I make the same order for costs for the period 14 March 2016 to 4 January 2017 on a party and party basis at the rate required by the Court Procedures Rules.
40․I note that the rate is now identified as 100% of the Supreme Court scale as per paragraph 36 above.
Orders
41․a. The applicant Ms Damiano pay pre-judgment interest in the sum of $24,220.75;
b. The applicant Ms Damiano pay Ms Dhaliwal’s costs of the counter-claim on a party and party basis at the rate of 100% of the Supreme Court scale; and
c. The applicant Ms Damiano to pay the further costs of Ms Dhaliwal’s for the period 14 March 2016 to 4 January 2017 in addition to the order of 26 October 2021 on a party and party basis at the rate of 100% of the Supreme Court scale.
42․Costs are to be agreed between the parties and, if not agreed within 30 days of the date of this decision, to be assessed.
43․Given that I am presently sitting in another jurisdiction of the Court and that this matter is now judicially concluded, I direct that I am no longer to be considered part-heard in this matter.
| I certify that the preceding forty-three [43] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Magistrate Stewart Associate: Jean-Baptiste Spahr Date: 24 October 2024 |
Corrigendum
24 July 2025 Replaced “29 September 2023” with “14 September 2023” Paragraphs: [32]
[i] Damiano v Dhaliwal [2021] ACTMC 14.
[ii] Damiano v Dhaliwal [2023] ACTMC 36.
[iii] See EMI Songs Australia Pty Ltd v Larrakin Music Publishing Pty Ltd [2011] FCAFC 92 at [9]
[v] S 154 Leases (Commercial and Retail) Act 2001.
[vi] See Rule 1721.
[vii] Magistrates Court of the Australian Capital Territory Practice Direction No 4 of 2007
[viii] Magistrates Court of the Australian Capital Territory Practice Direction Civil 2 1 July 2019
[ix] A quick glance through the file shows these orders as a bare minimum:16 December 2021, 30 April 2018, 19 October 2016 and multiple costs assessment orders in favour of Ms Dhaliwal.
[x] Calderbank v Calderbank [1975] All Er 333.
[xi] See Hazeldene’s Chicken Farm Pty Ltd v Victorian Workcover Authority (No 2) [2005] VSCA 298 at [25]
[xii] Ruby v Marsh (1975) 132 CLR 642 at 644.
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