Ezekiel-Hart v Reis (No 3)
[2019] ACTSC 250
•6 September 2019
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Ezekiel-Hart v Reis (No 3) |
Citation: | [2019] ACTSC 250 |
Hearing Dates: | 8, 9, 10 July 2019 |
DecisionDate: | 6 September 2019 |
Before: | Crowe AJ |
Decision: | See [18] |
Catchwords: | COSTS – Indemnity costs – where plaintiff wholly unsuccessful in his claim – where defamation claim statute-barred – where pleadings were defective – where plaintiff given notice of limitation period issue by defendants prior to the hearing – where good defences – where plaintiff notified of defendants’ intention to seek indemnity costs prior to the hearing should the issues raised not be addressed |
Legislation Cited: | Legal Profession Act 2006 (ACT) ss 468, 587A Limitation Act 1985 (ACT) s 21B |
Cases Cited: | Baulderstone Hornibrook Engineering Pty Limited v Gordian Runoff Limited (No 2) [2009] NSWCA 12 Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 Hillebrand v Penrith Council [2000] NSWSC 1058 |
Parties: | Emmanuel Tam Ezekiel-Hart (Plaintiff) Robert Reis (First Defendant) Council of the Law Society of the Australian Capital Territory (Second Defendant) Australian Capital Territory (Third Defendant) |
Representation: | Counsel Self-represented (Plaintiff) T Power (First and Second Defendant) B Buckland (Third Defendant) |
| Solicitors Self-represented (Plaintiff) Phelps Reid Foster Johnson (First and Second Defendant) ACT Government Solicitor (Third Defendant) | |
File Number: | SC 433 of 2017 |
Crowe AJ:
I delivered judgment in this matter on 25 July 2019. At that time I reserved the question of costs and made directions for the filing and service of written submissions by the parties. The first and second defendants and the plaintiff have made submissions pursuant to those directions. The defendants filed their submissions on 15 August 2019, and the plaintiff filed his submissions on 3 September 2019.
Submissions of first and second defendants
These defendants submit that an order should be made that the plaintiff pay their costs of the action on an indemnity basis. The basis for that order arises from:
(a) the overwhelming success of the defendants in defeating the plaintiff’s claims; and,
(b) the contents of a letter sent by Mr Phelps (the solicitor for the defendants) to the plaintiff, dated 12 March 2019, in which Mr Phelps pointed out the limitation period difficulties faced by the plaintiff, the defects in his claim and the defence available to the defendant by way of ss 468 and 587A of the Legal Profession Act 2006 (ACT). Mr Phelps requested that the plaintiff take action to deal with the limitation problems, and abandon the defective parts of his Statement of Claim by 21 March 2019. The letter concluded by warning the plaintiff that if he did not take the requested action the defendants would apply to the Court for appropriate relief and rely on the letter in seeking indemnity costs.
The plaintiff did not take any action at that time as requested by the defendants.
The defendants rely on the cases of Baulderstone Hornibrook Engineering Pty Limited v Gordian Runoff Limited (No 2) [2009] NSWCA 12 at [4] per Allsop P, Beazley and Campbell JJA agreeing; and, Hillebrand v Penrith Council [2000] NSWSC 1058.
Submissions of the plaintiff
The plaintiff provided lengthy submissions which I found difficult to understand. He appears to consider that an award of costs, or indemnity costs, would in some way “fetter” his right of appeal. He also argued that the defendants had brought the proceedings upon themselves by their failure to reconsider his application for a practising certificate. In relation to the latter, the plaintiff relied upon Cooke v Rixon
(No 2) [2017] ACTSC 396 at [11]-[13] per McWilliam AsJ. It appears that the plaintiff seeks an order that each party bear its or his own costs.
Consideration
The limitation and pleading issues referred to in the 12 March 2019 letter were the subject of the first and second defendants’ Application in Proceeding dated
18 April 2019. I decided at the hearing, which commenced on 8 July 2019, to determine the pleading issue and to hear the plaintiff’s application to extend time as preliminary steps to the substantive hearing. The plaintiff was unsuccessful in relation to both issues.
I dealt with the limitation issue in relation to the cause of action in defamation in
Ezekiel-Hart v Reis (No 2) [2019] ACTSC 192 (Ezekiel-Hart (No 2)) at [74]-[80]. I concluded that it was “not reasonable” for the plaintiff to have decided not to commence proceedings between 22 November 2016 and 21 March 2017. As the plaintiff is a trained lawyer he should have been aware, having regard to the stringency of the test in s 21B of the Limitation Act 1985 (ACT), that the prospects of him succeeding in the extension of time application were remote.
In relation to the claim under the Human Rights Act 2004 (ACT) (HRA), I considered in Ezekiel-Hart (No 2) at [81]-[83] that the test for extending time involved a broader discretion than that contained in s 21B. Had an application to extend time been made at a preliminary stage the plaintiff might well have succeeded in having time extended. The reason I refused his application was because I concluded that, in the context of hearing all of the evidence at trial, the HRA claims were hopeless.
I do not see how making a costs order can affect the plaintiff’s right to challenge the substantive judgment in this matter. Nor do I consider any action which may or may not have been taken by the first and second defendants in relation to the reconsideration of the plaintiff’s application for a practising certificate to be relevant to the question of costs arising from the plaintiff’s claims in defamation and under the HRA.
I see no reason at all in the overall circumstances of this case for depriving the successful parties of their costs. This leaves for determination the application by the first and second defendants for an order for indemnity costs.
In Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225, Sheppard J said at 230-234:
In consequence of the settled practice which exists, the Court ought not usually make an order for the payment of costs on some basis other than the party and party basis. The circumstances of the case must be such as to warrant the Court in departing from the usual course. That has been the view of all judges dealing with applications for payment of costs on the indemnity or some other basis whether here or in England. The tests have been variously put. The Court of Appeal in Andrews v. Barnes (39 Ch D at 141) said the Court had a general and discretionary power to award costs as between solicitor and client "as and when the justice of the case might so require." Woodward J in Fountain Selected Meats appears to have adopted what was said by Brandon LJ (as he was) in Preston v. Preston ((1982) 1 All ER at 58) namely, there should be some special or unusual feature in the case to justify the Court in departing from the ordinary practice. Most judges dealing with the problem have resolved the particular case before them by dealing with the circumstances of that case and finding in it the presence or absence of factors which would be capable, if they existed, of warranting a departure from the usual rule. But as French J said (at 8) in Tetijo, "The categories in which the discretion may be exercised are not closed". Davies J expressed (at 6) similar views in Ragata.
Notwithstanding the fact that that is so, it is useful to note some of the circumstances which have been thought to warrant the exercise of the discretion. I instance the making of allegations of fraud knowing them to be false and the making of irrelevant allegations of fraud (both referred to by Woodward J in Fountain and also by Gummow J in Thors v Weekes (1989) 92 ALR 131 at 152; evidence of particular misconduct that causes loss of time to the Court and to other parties (French J in Tetijo); the fact that the proceedings were commenced or continued for some ulterior motive (Davies J in Ragata) or in wilful disregard of known facts or clearly established law (Woodward J in Fountain and French J in J-Corp); the making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions (Davies J in Ragata); an imprudent refusal of an offer to compromise (eg Messiter v. Hutchinson (1987) 10 NSWLR 525, Maitland Hospital v. Fisher (No. 2) (1992) 27 NSWLR 721 at 724 (Court of Appeal), Crisp v. Keng (Supreme Court of New South Wales, 27 September 1993, unreported, Court of Appeal) and an award of costs on an indemnity basis against a contemnor (eg Megarry V-C in EMI Records). Other categories of cases are to be found in the reports. Yet others to arise in the future will have different features about them which may justify an order for costs on the indemnity basis. The question must always be whether the particular facts and circumstances of the case in question warrant the making of an order for payment of costs other than on a party and party basis.
It remains to say that the existence of particular facts and circumstances capable of warranting the making of an order for payment of costs, for instance, on the indemnity basis, does not mean that judges are necessarily obliged to exercise their discretion to make such an order. The costs are always in the discretion of the trial judge. Provided that discretion is exercised having regard to the applicable principles and the particular circumstances of the instant case its exercise will not be found to have miscarried unless it appears that the order which has been made involves a manifest error or injustice.
The real question arising here is whether the plaintiff’s conduct of the litigation in the context of the warning given in the 12 March 2019 letter was sufficiently unreasonable to warrant making an indemnity costs order.
The situation is complicated by the fact that the plaintiff had, on the one hand, a relatively hopeless case for extending time in relation to the defamation claim, and, on the other, an arguable case for extending time in the HRA claim. Despite this, it is clear that it was unreasonable for him to ignore the 12 March 2019 letter. Had he taken the appropriate step at the time of applying to extend time, the defendants and the Court would have avoided the considerable work and time involved in dealing with the substantive defamation claim.
It seems to me that the defendants’ Application in Proceeding dated 18 April 2019 was also a response to the plaintiff’s inaction in the face of the 12 March 2019 letter. It constituted the application for “appropriate relief” which was foreshadowed in the letter.
It would also have been reasonable for the plaintiff to take steps to regularise the pleading of his statement of claim at an earlier time. This issue, however, occupied significantly less time at the hearing than those other matters referred to above.
It seems to me that the unreasonable behaviour of the plaintiff in failing to address the limitation and pleading issues added two days of hearing time, and led to the defendants’ Application in Proceeding. In all of the circumstances it is appropriate that the plaintiff should pay the costs of and incidental to the Application in Proceeding dated 18 April 2019, and of the hearing on 9 and 10 July 2019, on an indemnity basis. Having regard to the outcome, the plaintiff should pay the costs of the first and second defendants, otherwise relating to the action, on an ordinary basis.
No submissions were made in relation to the costs of the third defendant. It is appropriate that they should follow the event.
The orders of the Court
Accordingly, the orders of the Court are as follows:
(1) The plaintiff is to pay the costs of the first and second defendants’ Application in Proceeding dated 18 April 2019, and of the hearing on 9 and 10 July 2019, on an indemnity basis.
(2) Subject to order (1), the plaintiff is to pay the costs of the first and second defendants.
(3) The plaintiff is to pay the costs of the third defendant.
| I certify that the preceding eighteen [18] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Acting Justice Crowe. Associate: Date: 6 September 2019 |
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