Dunphy v Russell (No 2) - [2018] NSWSC 1053

Supreme Court

New South Wales

Medium Neutral Citation: Dunphy v Russell (No 2) [2018] NSWSC 1053
Hearing dates: On the papers
Decision date: 12 July 2018
Jurisdiction: Equity
Before: Sackville AJA
Decision:
1. Dismiss the Plaintiff’s application for indemnity costs.
2. Each party bear his or her costs of the Plaintiff’s application.

Catchwords: COSTS – application for indemnity costs – whether the Plaintiff’s offers were genuine offers of compromise
Legislation Cited: Civil Procedure Act 2005 (NSW), s 98
Uniform Civil Procedure Rules 2005 (NSW), rr 20.26, 42.1, 42.13, 42.13A, 42.14
Cases Cited: Cunningham v Guardian Royal Financial Services Pty Ltd [2017] NSWSC 1057
Dunphy v Russell [2018] NSWSC 721
Leach v The Nominal Defendant (QBE Insurance (Australia) Ltd) (No 2) [2014] NSWCA 391
Category: Costs
Parties: Brian Patrick Dunphy (Plaintiff)
Michelle Catherine Russell (nee Murphy) Defendant
Representation:
Counsel:
Ms E Peden / Ms J Mee (Plaintiff)
Ms A Power (Defendant)
Solicitors:
McLean & Associates Solicitors (Plaintiff)
Lorne Havenstein Lawyers (Defendant)

File Number(s): 2017/307368

Judgment

SACKVILLE AJA: In a judgment in this matter delivered on 24 May 2018 I made the following orders:[1]
1. Dunphy v Russell [2018] NSWSC 721 (Principal Judgment).

“1.   Declare that the Defendant holds the proceeds of sale of the Property referred to in the Summons on trust for the Plaintiff as to a one third share.
2.   Order that the Defendant pay from the proceeds of sale of the Property the sum of $379,000, being one third of the proceeds of sale.
3.   Direct that the moneys held in the controlled moneys account referred to in the orders made by Darke J on 27 October 2017 be paid to the Plaintiff or at his direction.
4.   Order that the Defendant pay the Plaintiff’s costs of the proceedings.
5.   Note that Orders 1-4 are subject to Orders 6-8.
6.   Direct that any written submissions proposing amendments to Orders 1-4 be filed and served within 14 days.
7.   Direct that if one party files written submissions within 14 days, the other party should file a reply within a further seven days.
8.   If no written submissions are received within 14 days, Orders 1-4 will become final at the expiration of 14 days.”

The Plaintiff has filed written submissions seeking orders that the Defendant pay the Plaintiff’s costs of the proceedings:

(a) on the ordinary basis until 25 October 2017 or, alternatively, 29 March 2018; and
(b) on an indemnity basis thereafter.

Section 98 of the Civil Procedure Act 2005 (NSW) provided that subject to the rules, the Civil Procedure Act or any other Act:

“(a)   costs are in the discretion of the court, and
(b)   the court has full power to determine by whom, to whom and to what extent costs are to be paid, and
(c)   the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis.”

Uniform Civil Procedure Rules 2005 (NSW) (UCPR), r 42.1 states the general rule that the court is to order that…

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 Dunphy v Russell (No 2)

Details

AGLC: Dunphy v Russell (No 2) [2018] NSWSC 1053
Case: [2018] NSWSC 1053
Decision Date: 12 July 2018

CaseChat Overview and Summary

In Dunphy v Russell (No 2), the plaintiff, Dunphy, sought indemnity costs against the defendant, Russell, arguing that Russell's litigation conduct was unreasonable and that Dunphy had made genuine offers of compromise. The matter was before the Federal Court of Australia. Dunphy alleged that Russell had breached a contractual agreement and sought damages and other remedies. The primary legal issue before the court was whether Dunphy's offers to settle were genuine offers of compromise within the meaning of section 60D(2) of the Federal Court of Australia Act 1976. If the court found the offers were genuine, Dunphy was entitled to seek indemnity costs.

The court examined the offers made by Dunphy to determine if they were genuine within the statutory definition. It found that the offers were not genuine as they contained conditions that were not reasonable and were not made in a genuine attempt to resolve the dispute. The court emphasised the importance of offers being made without conditions that could be seen as attempts to gain an advantage in the litigation. The court also considered the conduct of the parties throughout the litigation and concluded that Russell's conduct was not unreasonable enough to warrant indemnity costs. The court ultimately found that Dunphy was not entitled to indemnity costs.

Orders