Deangrove Pty Ltd v Commonwealth Bank of Australia

[2003] FCA 566

FEDERAL COURT OF AUSTRALIA

Deangrove Pty Ltd v Commonwealth Bank of Australia [2003] FCA 566

DEANGROVE PTY LIMITED (RECEIVERS AND MANAGERS APPOINTED) & ANOR v COMMONWEALTH BANK OF AUSTRALIA
N 1142 OF 2000

SACKVILLE J
SYDNEY
6 JUNE 2003

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 1142 OF 2000

BETWEEN:

DEANGROVE PTY LIMITED (RECEIVERS AND MANAGERS APPOINTED)
FIRST APPLICANT

JOHN ANTHONY JEANS
SECOND APPLICANT

AND:

COMMONWEALTH BANK OF AUSTRALIA
RESPONDENT

COMMONWEALTH BANK OF AUSTRALIA
CROSS CLAIMANT

DEANGROVE PTY LIMITED (RECEIVERS AND MANAGERS APPOINTED)
FIRST CROSS RESPONDENT

JOHN ANTHONY JEANS
SECOND CROSS RESPONDENT

JOHN RICHARD BRUCE
THIRD CROSS RESPONDENT

JUDGE:

SACKVILLE J

DATE OF ORDER:

6 JUNE 2003

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

1.The applicants pay the respondent’s costs of the proceedings (including the costs of the cross-claim, the applicants’ motion of 26 March 2003 for leave to withdraw an admission and any reserved costs).

Note:        Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 1142 OF 2000

BETWEEN:

DEANGROVE PTY LIMITED (RECEIVERS AND MANAGERS APPOINTED)
FIRST APPLICANT

JOHN ANTHONY JEANS
SECOND APPLICANT

AND:

COMMONWEALTH BANK OF AUSTRALIA
RESPONDENT

COMMONWEALTH BANK OF AUSTRALIA
CROSS CLAIMANT

DEANGROVE PTY LIMITED (RECEIVERS AND MANAGERS APPOINTED)
FIRST CROSS RESPONDENT

JOHN ANTHONY JEANS
SECOND CROSS RESPONDENT

JOHN RICHARD BRUCE
THIRD CROSS RESPONDENT

JUDGE:	SACKVILLE J
DATE:	6 JUNE 2003
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1. On 16 May 2003, I made orders dismissing the application and entering judgment against the first cross-respondent (“Deangrove”) and the second cross-respondent (“Mr Jeans”) in the sum of $4,749,813.30.  I directed that the parties file written submissions as to costs.

2. The respondent – cross-claimant (“CBA”) submits that it should have the benefit of an order for indemnity costs in respect of defending a number of allegations that, in effect, were not pressed at the hearing.  The CBA’s submissions identify a number of pleaded issues that were not ultimately pressed, yet required the CBA to undertake detailed preparation.  The work included the drafting of affidavits, discovery of a considerable body of documents and the preparation of documents for a tender bundle.  The CBA proposes that the applicants should be required to pay the CBA’s costs of the proceedings

   • as to 30 per cent, on an indemnity basis; and
   • as to the balance, on the standard basis.

3. The applicants submit that the usual order for costs should be made.  They say that the critical issue at trial was whether Mr Cleary had taken over a decisive role with the Japanese interests and, if so, whether Mr Jeans had relied on those matters when executing the documents or at the time of drawdown.  They contend that the other issues only became of significance if the threshold question was decided in favour of the applicants and that is why attention was focussed on that question.

4. In my view, it is appropriate that the applicants pay the CBA’s costs on the usual basis.  While the applicants ultimately did not press some issues, care must be taken not to discourage parties, even at a late stage in litigation, from narrowing the issues.  Despite the applicants’ most unsatisfactory history of non-compliance with directions (a matter not relied on by the CBA in relation to costs) the hearing was conducted in an economical and efficient manner, doubtless reflecting the contribution of the applicants’ senior counsel.  I do not think that the circumstances of the present case are such that the Court should depart from the usual rule: cf Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225, at 233, per Sheppard J.

5. Accordingly, I propose to order that the applicants pay the respondent’s costs of the proceedings (including the costs of the cross-claim, the applicants’ motion of 26 March 2003 for leave to withdraw an admission and any reserved costs).

I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice SACKVILLE.

Associate:

Dated:             6 June 2003

Counsel for the Applicant:	Mr J Ireland QC
Solicitor for the Applicant:	Smits Leslie
Counsel for the Respondent:	Mr A G Bell with Mr D A McLure
Solicitor for the Respondent:	L E Taylor
Date of Hearing:	16 May  2003
Date of Judgment:	6 June 2003