DKL v LYK (No 2) - [2019] SASC 160

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
DKL v LYK (No 2)
[2019] SASC 160
Judgment of The Honourable Justice Doyle
10 September 2019
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - GENERAL RULE: COSTS FOLLOW EVENT - GENERAL PRINCIPLES AND EXERCISE OF DISCRETION
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - RECOVERY OF COSTS
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - INDEMNITY COSTS - POWER TO ORDER
Application for costs of the action.
The plaintiff contends that she was the successful party and should be entitled to recover the entirety of her costs of the action from the defendant. She further contends that those costs should be ordered on an indemnity basis, firstly, on the basis that the defendant’s case was hopeless and untenable, and secondly, on the basis that the plaintiff ultimately obtained judgment in terms no less favourable than filed and Calderbank offers she made shortly before trial.
The defendant rejects the contention that the plaintiff was the successful party, or at least that the degree of success enjoyed by the plaintiff should entitle her to any net costs entitlement in her favour. The defendant also contests both bases put forward for any costs order in favour of the plaintiff being on an indemnity basis.
Held (per Doyle J):
1. The defendant is to pay the plaintiff 75 per cent of her costs of the action (including both the claim and counterclaim) on a party and party basis.
Family Law Act 1975 (Cth) ; Domestic Partners Property Act 1996 (SA) ; Law of Property Act 1936 (SA); Supreme Court Civil Rules 2006 (SA) r 187(2), r 187(6)(c), r 188(1), r 188F, referred to.
DKL v LYK [2019] SASC 100; Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397; Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225; Morris v McEwen (2005) 92 SASR 281; BHP Billiton Ltd v Parker (2012) 113 SASR 206, considered.

DKL v LYK (No 2)
[2019] SASC 160
Civil

DOYLE J: On 17 June 2019 I delivered my reasons for judgment in this matter: DKL v LYK[1] (my primary reasons). It remains for me to deal with the issue of costs.
[1] DKL v LYK [2019] SASC 100.
The plaintiff contends that she was the successful party and hence that she should be entitled to recover the entirety of her costs of the action from the defendant. She further contends that those costs should be ordered on an indemnity basis for two reasons. First, on the basis that the defendant’s case was hopeless and untenable. And secondly, on the basis that the plaintiff ultimately obtained judgment in terms no less favourable than the filed and Calderbank offers she made shortly before trial, which offers she contends were imprudently refused by the defendant.
The defendant takes a very different view of the appropriate approach to costs. He…

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 DKL v LYK (No 2)

Details

AGLC: DKL v LYK (No 2) [2019] SASC 160
Case: [2019] SASC 160
Decision Date: 10 September 2019

CaseChat Overview and Summary

The case of DKL v LYK (No 2) involved the plaintiff, DKL, bringing an action against the defendant, LYK, in the Supreme Court of New South Wales. The dispute centred around the recovery of costs, specifically whether the defendant should be ordered to pay indemnity costs to the plaintiff due to the defendant's refusal of the plaintiff's offers to settle. The plaintiff argued that the defendant's refusal was unreasonable and thus justified an order for indemnity costs.

The central legal issue before the court was whether the defendant's refusal of the plaintiff's offers to settle was reasonable or unreasonable. If unreasonable, the court had the discretion to order indemnity costs. The court needed to consider the general principles guiding the exercise of this discretion, including the overall conduct of the litigation, the merits of the case, and the specific circumstances surrounding the offers to settle. The court also had to examine whether there was a proper basis for an order for indemnity costs in light of these considerations.

In determining the matter, the court carefully reviewed the evidence and arguments presented. The court found that the defendant's refusal to accept the plaintiff's offers was not unreasonable, given the circumstances and the merits of the case. The court concluded that the plaintiff had not demonstrated that the defendant acted imprudently or unreasonably by refusing the offers. Consequently, the court held that there was no proper basis for ordering indemnity costs against the defendant. Instead, the court exercised its discretion to order that the defendant pay 75% of the plaintiff's costs on a party and party basis.

The final orders of the court were that the defendant, LYK, pay the plaintiff, DKL, 75% of her costs of the action, including both the claim and counterclaim, on a party and party basis. The court's decision emphasised the importance of assessing the reasonableness of the defendant's conduct and the broader context of the litigation in determining the appropriate allocation of costs.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

For these reasons, I am not satisfied that it was imprudent or unreasonable for the defendant to have refused the plaintiff’s offers, or that there is otherwise a proper basis for an order for indemnity costs.Conclusion I order that the defendant pay the plaintiff 75 per cent of her costs of action (including both the claim and counterclaim) on a party and party basis.

Ratio Decidendi

Legal Principle Established

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