Davidson v Elkington
[2011] WASC 29 (S)
•11 FEBRUARY 2011
DAVIDSON -v- ELKINGTON [2011] WASC 29 (S)
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2011] WASC 29 (S) | |
| Case No: | CIV:2169/2007 | 9 APRIL, 3-5 MAY, 14 JUNE, 18-20 AUGUST 2010 | |
| Coram: | HALL J | 11/02/11 | |
| 22/03/11 | |||
| 10 | Judgment Part: | 1 of 1 | |
| Result: | No order as to costs | ||
| B | |||
| PDF Version |
| Parties: | WILLIAM ANGUS DAVIDSON SILVIA DAVIDSON JOHN EDWARD ELKINGTON IRENE JACQUELINE ELKINGTON |
Catchwords: | Costs Whether appropriate to apportion on basis of who succeeded on issues Whether any special orders appropriate Where both parties equally successful/unsuccessful No order as to costs Turns on own facts |
Legislation: | Legal Profession Act 2008 (WA), s 280(2) Rules of the Supreme Court 1971 (WA), O 66 Transfer of Land Act 1893 (WA), s 129C |
Case References: | Amaca Pty Ltd (formerly James Hardie & Co Pty Ltd) v Hannell [2007] WASCA 158(S) Davidson v Elkington [2011] WASC 29 Heartlink Ltd v Jones (as liquidator of HL Diagnostics Pty Ltd (In liq) [2007] WASC 254(S) J-Corp Pty Ltd v Australian Builders Labourers Federation Union of Workers (Western Australian Branch) (No 2) (1993) 46 IR 301 Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129(S) |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CIVIL
DECISION : 22 MARCH 2011 FILE NO/S : CIV 2169 of 2007 BETWEEN : WILLIAM ANGUS DAVIDSON
- SILVIA DAVIDSON
Plaintiffs
AND
JOHN EDWARD ELKINGTON
IRENE JACQUELINE ELKINGTON
Defendants
(BY ORIGINAL ACTION)
JOHN EDWARD ELKINGTON
IRENE JACQUELINE ELKINGTON
Plaintiffs by Counterclaim
AND
WILLIAM ANGUS DAVIDSON
SILVIA DAVIDSON
Defendants by Counterclaim
(BY COUNTERCLAIM)
Catchwords:
Costs - Whether appropriate to apportion on basis of who succeeded on issues - Whether any special orders appropriate - Where both parties equally successful/unsuccessful - No order as to costs - Turns on own facts
Legislation:
Legal Profession Act 2008 (WA), s 280(2)
Rules of the Supreme Court 1971 (WA), O 66
Transfer of Land Act 1893 (WA), s 129C
Result:
No order as to costs
Category: B
Representation:
Original Action
Counsel:
Plaintiffs : Mr N D C Dillon
Defendants : Mr A P Hershowitz
Solicitors:
Plaintiffs : Karp Steedman Ross-Adjie
Defendants : Kott Gunning
(Page 3)
Counterclaim
Counsel:
Plaintiffs by Counterclaim : Mr A P Hershowitz
Defendants by Counterclaim : Mr N D C Dillon
Solicitors:
Plaintiffs by Counterclaim : Kott Gunning
Defendants by Counterclaim : Karp Steedman Ross-Adjie
Case(s) referred to in judgment(s):
Amaca Pty Ltd (formerly James Hardie & Co Pty Ltd) v Hannell [2007] WASCA 158(S)
Davidson v Elkington [2011] WASC 29
Heartlink Ltd v Jones (as liquidator of HL Diagnostics Pty Ltd (In liq) [2007] WASC 254(S)
J-Corp Pty Ltd v Australian Builders Labourers Federation Union of Workers (Western Australian Branch) (No 2) (1993) 46 IR 301
Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129(S)
(Page 4)
1 HALL J: For reasons delivered on 11 February 2011 I dismissed both the plaintiffs' claim and the defendants' counterclaim: Davidson v Elkington [2011] WASC 29. This outcome would generally result in orders for costs in favour of the successful party in each respect: Rules of the Supreme Court 1971 (WA)O 66 r 1(1). However, both parties have sought that I exercise my discretion to make costs orders that differ from this general position.
2 The plaintiffs' claim was for a declaration as to the existence of a right of way, damages for alleged interference with that right and injunctive relief to prevent future interference. The plaintiffs also claimed a portion of the defendants' land on the basis of adverse possession. Each of those claims failed. However the plaintiffs submit that because I found that a right of way plainly existed they were substantially successful in respect of the issue that was the basis for their claim for a declaration. It was submitted that any costs order needed to take into account that a declaration was not ordered on discretionary grounds because the existence of the right of way was not ultimately disputed and the evidence and law in respect of it were clear.
3 The defendants submit that whilst they should be liable to pay the costs of the plaintiffs in respect of the counterclaim, they should, as the successful party in respect of the claim, receive their costs in that regard. They also seek a number of other orders. In particular, that the plaintiffs pay the defendants the costs of an interlocutory injunction obtained by the plaintiffs. They also seek that the limits on the defendants' costs be removed in respect of getting up for trial pursuant to s 280(2) of the Legal Profession Act 2008 (WA). Further, they seek orders that would enable getting up and counsel's refresher to be claimed in respect of an adjourned hearing. Finally, they seek that costs in respect of the consideration and objection to the admissibility of the plaintiffs' expert evidence be taxed on an indemnity basis.
4 It should be noted that on the hearing in respect of costs both parties accepted that much of the evidence called in this matter was relevant both to the issues raised on the claim and the counterclaim. Thus, there may be difficulties in determining whether costs were incurred in one respect or the other. For this reason I raised with the parties the possibility that a fairer result may be achieved by determining which of the parties was substantially successful and the percentage of costs that party should receive.
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5 The power exists to apportion costs to make orders relating to different parts of the proceedings where that is appropriate. Order 66 rule 1(3) provides that where a successful party has introduced an issue upon which he or she has failed and that issue has increased the costs of the proceedings the court may order that party to pay costs in respect of that issue. Order 66 rule 2(a) provides that where there are multiple causes of action, costs may be allowed to the plaintiff from those on which he or she succeeds and to the defendant on those on which he or she succeeds in the same manner as if separate actions had been brought. These provisions permit costs to be distributed according to the outcome of particular issues in the action.
6 There can be difficulties in assessing liability for costs on the basis of who won or lost a particular issue. Even where the issues are capable of identification, the costs relating to each may not be readily separated. Evidence may have been led which was relevant both to a successful and an unsuccessful issue. I will return to this question later.
7 In the present case, I identified five issues that required determination in my reasons: Davidson v Elkington [10]. They were:
1. Is there a right of way and what is its nature?
2. Has the right of way been abandoned or become obsolete?
3. Is there any basis for modifying the right of way pursuant to s 129C of the Transfer of Land Act 1893 (WA) (the TLA)?
4. Has there been inference with exercise of the right of way?
5. Did the plaintiffs acquire the encroached land by adverse possession?
8 Issues 1, 4 and 5 were raised as part of the plaintiffs' case, whereas issues 2 and 3 formed the basis of the defendants' case on the counterclaim. I should note that the identification of these as issues was not intended by me to reflect the areas of substantial dispute between the parties; rather it was to identify for the purpose of the reasons the matters that needed to be considered in order to reach a resolution.
9 The plaintiffs submit that notwithstanding that a declaration was not ordered I came to the conclusion that there was a right of way and that, accordingly, the plaintiffs were successful in respect of the first issue. They submit that this was a significant issue at the trial and justifies them
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- receiving a substantial proportion of their costs. It was suggested that this should be in the order of 75%.
10 However, as my reasons make clear, whilst in the original pleadings the defendants had not conceded the existence of a right of way, by the time the matter came to trial, that was no longer an issue. Amendments were made to the defence which had the effect of specifically abandoning any claim that the right of way did not cover people other than the registered proprietors. The defendants also disavowed any suggestion that the whole right of way was the subject of any abandonment claim, rather they sought only to make that claim in respect of a portion of the right of way (in respect of which a modification was sought in the alternative).
11 As I noted during the hearing on costs, the court has no interest in making declarations that are hypothetical in nature if there is no issue between the parties. Furthermore, the existence of the right of way was readily apparent from the registered titles. It is true that the matter only became a non-issue at the commencement of the trial. Accordingly, the plaintiff may have been put to some expense in seeking to prove the existence and continuation of the right of way. However, in the event, the evidence that was necessary in that regard was also required on the trial in order to establish the nature of the right of way. Furthermore, that evidence was very small in compass consisting of copies of the relevant certificates of title and other registered documents. Accordingly, I do not accept the submission that the issue of whether the right of way existed was a major one in these proceedings or that any significant amount of costs was incurred in respect of it.
12 Returning then to the substantial issues at trial, they were, on behalf of the plaintiffs, whether there had been interference with the right of way and whether they were entitled to a portion of the defendants' land by virtue of adverse possession and, on behalf of the defendants, whether a portion of the right of way had been abandoned or become obsolete or, alternatively, whether the right of way should be modified to exclude that same portion.
13 The power of the court to depart from the general rule that costs follow the event and instead adjust the costs by reference to the failure of a generally successful party on specific and particular issues is well established: Amaca Pty Ltd (formerly James Hardie & Co Pty Ltd) v Hannell [2007] WASCA 158(S) [6]. It is, however, necessary to identify discrete and severable issues, the litigation of which has increased the costs of conducting the proceedings. The exercise of this power should be
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- approached broadly and as a matter of impression and without an attempt at 'mathematical precision', which is likely to prove illusory: Amaca [6] and J-Corp Pty Ltd v Australian Builders Labourers Federation Union of Workers (Western Australian Branch) (No 2) (1993) 46 IR 301.
14 Applying those principles to this case, what is suggested by the plaintiffs is that, although the defendants were generally successful in regards to the claim, any award of costs to the defendants in that respect should be reduced to take into account the discrete issue of whether the right of way existed, in respect of which it is said that the defendants failed. However, the discretion to make such an adjustment depends upon such an issue having added to the cost of proceedings in a significant and readily discernable way. Where a generally successful party has failed on only a minor issue, which did not add materially to the cost of the conduct of the proceedings, it is not ordinarily appropriate to depart from the general rule unless the conduct of the successful party in relation to that issue was unreasonable: Amaca [7]. As I have noted, whether there was a right of way was not an issue at the trial. To the extent it was an issue before that time, it was not one that added to the costs of the proceedings in a significant way. Accordingly, in my view, there is no proper basis for reducing the costs that the defendants would otherwise be entitled to in respect of the claim.
15 As regards the matters raised by the defence, I have reached the following conclusions. In respect of the plaintiffs' application for an interlocutory injunction that application was successful and the costs were reserved. The basis for that application was that the plaintiffs alleged that there had been interference with the exercise of the right of way and there was a reasonable apprehension that such interference would continue. Of course, the test required for the obtaining of an injunction is different to that required on the final determination of the matter. In the event, the plaintiffs were unsuccessful in their claims that there had been interference with the exercise of the right of way. In these circumstances, there is merit in the defendants' claim that they should be entitled to the costs of defending that application.
16 As regards the defendants' submission that there should be a special costs order in respect of the getting up of this matter, I accept that affidavits filed by the defendants show that a large quantity of work was done and the cost of that work is likely to exceed the limits under the applicable costs determination. The court has a discretion under s 280(1) of the Legal Profession Act 2008 to order the payment of costs above those fixed by a determination where it is apparent that the allowable
(Page 8)
- amount is inadequate because of the unusual difficulty, complexity or importance of the matter. In this respect, the court could have regard to whether the work done was appropriate to the significance of the issues that arose in the litigation: Heartlink Ltd v Jones (as liquidator of HL Diagnostics Pty Ltd (In liq) [2007] WASC 254(S) [19]. That can mean either the significance of the issues to the parties or the significance of the issues to other prospective parties, the public or the community generally. Because this decision would ordinarily be made in advance of taxation it is a matter of impression rather than of detailed evaluation.
17 In written submissions the defendants relied upon a number of factors in support of their claim for a special costs order. There was reference to the trial having occurred at different stages between April and August 2010, the large number of witnesses called by the plaintiffs, the substantial number of objections taken by the plaintiffs, the limited probative value of some of the evidence adduced by the plaintiffs, the legal argument required in relation to the evidence of one witness (Mr Tidman) and the evidence adduced in relation to an alleged assault on 14 April 2007 which the defendants submitted was unreasonable and needlessly increased the costs incurred by the defendants.
18 I have carefully considered those matters and do not accept that together they justify a conclusion that the matter was of unusual difficulty or complexity. The number of significant witnesses was in fact small in number, being primarily confined to the parties and previous owners of both properties. Much of the evidence taken from the other witnesses was very brief and, in some cases, uncontested. The resolution of objections did not take any significant time and many were resolved by further clarifying evidence adduced from the witnesses. Some of the evidence called was of limited probative value, but this was true of both parties and does not justify a conclusion that the matter, as a whole, was of unusual difficulty.
19 As regard the defendants' claim that an order is required to ensure that the defendants are entitled to claim the full fee on brief contemplated by Item 20(a) of the Supreme Court Scale of Costs 2010, this is said to arise because the trial was ordered to have commenced on 9 April 2010. The circumstances of this were that on that date both parties sought to call evidence from witnesses who would not be available on the proposed trial dates. This was sought to be done by way of a de bene esse hearing. In the event, the taking of that evidence was before me and since it was known that I would be the trial judge, the simpler course was to order that the trial be taken to have commenced on 9 April 2010 and that the
(Page 9)
- evidence of the witnesses therefore be evidence on the trial. As I understand it, the defendants claim that because the trial was taken to have commenced at that time, counsel's costs in respect of the fee on brief, which were incurred after 9 April 2010, could not be claimed unless a special order was made in this regard. Whilst there appears to be some superficial merit in this claim it is superseded by the order that I propose to make in this matter, which I will refer to shortly.
20 Finally, the defendants seek indemnity costs for costs incurred in relation to dealing with the plaintiffs' expert evidence in respect of alleged losses sustained as a result of not being able to operate a business on their land. The circumstances in this regard are as follows. The plaintiffs' claim for damages in respect of interference included an amount attributable to losses for an inability to pursue a bed and breakfast business at the plaintiffs' property. The plaintiffs' obtained an expert report from a Mr Moore in this regard. During the trial, and immediately prior to the plaintiffs' calling Mr Moore, the defendants raised an objection that an evidentiary basis for the expert opinion had not been established. Advance notice of that objection had not been given to the plaintiffs, as was required. In those circumstances, I allowed the plaintiffs an adjournment to obtain additional evidence if necessary. The parties then conferred and agreed a sum in relation to this component of the claim for damages. The defendants submit that they incurred significant costs in dealing with the expert evidence, including in respect of the adjournment of the trial and the process of conferral.
21 As regards the adjournment, it was necessary due to the lateness of the defendants' objection to the expert report. As regards the conferral process, I have read the defendants' written submissions and this does not appear to have been unduly onerous or complicated.
22 The making of an indemnity costs order is discretionary and may be used to mark the disapproval of improper or unreasonable conduct: Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129(S) [10] - [11]. I note that the amount originally claimed for this component of the damages was $26,000 and the amount agreed, after conferral, was $7,500. This was not a significant issue in the course of the trial. Whilst it did result in an adjournment, the fault for that cannot be laid solely at the plaintiffs' door. In my view, this is not a matter deserving of the exercise by the court of the discretion to make an indemnity costs order.
23 Returning then to the appropriate orders as to costs in this case. As I earlier noted, the ordinary orders would be those that followed the
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- outcomes: that is, that the plaintiffs pay the defendants' costs on the claim and the defendants pay the plaintiffs' costs on the counterclaim. However, the evidence is not so easily severable. Witnesses called by both parties gave evidence that was relevant, for example, both for the plaintiffs' claim for adverse possession and for the defendants' claim that the right of way had been abandoned or should be modified. Witnesses who were favourable to the party calling them in one respect were sometimes adverse to them in another respect. Evidence as to incidents that had occurred on the right of way, such as the erection of buildings or fences, were relied upon both by the plaintiffs to show interference and by the defendants to show abandonment. To make orders that each party have the costs of either the claim or counterclaim, or of the issues on which they were successful would likely result in further and costly argument.
24 Having carefully considered the pleadings, the transcript, the documentary evidence tendered at the trial and the submissions of the parties, my clear impression is that the respective claims of the parties contributed equally to the cost of these proceedings. No useful purpose would be served by awarding costs to each party which on being set-off one against the other would be nullified. In those circumstances, the fair and just outcome is that both parties should bear their own costs. In coming to that conclusion I have also taken into account any costs attributed to the application for the interlocutory injunction. Accordingly, there will be no order as to costs.
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