Ferella v Official Trustee in Bankruptcy

[2016] NSWCA 27

Court of Appeal

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:	Ferella v Official Trustee in Bankruptcy [2016] NSWCA 27
Hearing dates:	On the papers
Decision date:	08 March 2016
Before:	Bergin CJ in Eq, Tobias AJA, Emmett AJA
Decision:	1. The appellants pay the first respondent’s costs of the appeal on an indemnity basis
Catchwords:	PROCEDURE - costs - arguments advanced by the appellants were so lacking in merit as to warrant an award of indemnity costs of the appeal - appeals as to costs - whether to award indemnity costs
Legislation Cited:	Conveyancing Act 1919 (NSW), s 66G
Category:	Costs
Parties:	Nida Ferella (First Appellant) Gustavo Ferella (Second Appellant) The Official Trustee in Bankruptcy (First Respondent) The Registrar General (Second Respondent)
Representation:	Counsel: Mr RK Newton (First and Second Appellants)  Solicitors: Zali Burrows Lawyers (First and Second Appellants) Craddock Murray Newmann Lawyers (First Respondent)
File Number(s):	2014/374828
Decision under appeal	Court or tribunal: Supreme Court of New South Wales Jurisdiction: Equity Division Citation: [no medium neutral citation for the Orders below] Date of Decision: 18 December 2014 Before: Nicholas AJ File Number(s): 2014/204343

Judgment

1. THE COURT: On 18 December 2015 the Court dismissed an appeal by the appellants from an order made by Nicholas AJ on 18 December 2014, pursuant to s 66G of the Conveyancing Act 1919 (NSW), appointing trustees for the sale of certain properties. In so dismissing the appeal the Court at [54] of its reasons (the principal judgment) expressed the view that the appellants’ submissions on the appeal were hopeless to the point that they should not have been made. At [55], the principal judgment foreshadowed that the arguments advanced by the appellants were so lacking in merit as to warrant an award of indemnity costs of the appeal in favour of the Official Trustee. However, before imposing any such an order, the Court at [56] directed that the appellants file and serve any submissions they might wish to make as to why such an order should not be made. On 5 February 2016 the appellants filed a single page of submissions contending that an indemnity costs order should not be made against either of them.

2. Two matters are relied upon in support of that contention. The first is that at [8] and [49(d)] of the principal judgment the Court noted that the second appellant, who was a bankrupt, was not a proper party to the proceedings either at first instance or on the appeal and thus should never have been joined in the original application for an order under s 66G. The appellants therefore submitted that as the second appellant had been wrongly joined as a defendant to the proceedings below by the Official Trustee, he should not be the subject of an indemnity costs order or any other costs order against him.

3. In our view there is no substance in this contention. It is true that the second appellant was joined as a defendant to the summons filed by the Official Trustee seeking an order under s 66G. If it had occurred to anyone, which it did not, objection could have been taken to the joinder and the second appellant would then have been dismissed from the proceedings. But that did not occur and both appellants were represented by the one counsel before the primary judge as well as before this Court and submissions were made both below and on the appeal on behalf of both of them. It is true that the majority of the submissions were directed to the position of the second appellant but those submissions, had they been successful, would have benefited the first appellant who therefore had an interest in their success.

4. The second contention is that the Court’s finding that the submissions on appeal were without merit was “to some extent” grounded on an antecedent finding at [23] of the principal judgment. This was that the orders of the primary judge were in effect consented to on the basis of an exchange between his Honour and counsel as set out at [21] of that judgment. It was submitted that the contrary position was at least arguable given that in that exchange, counsel for the appellants only conceded that “to some extent” the excision of one of the properties from the Official Trustee’s application “would partly meet the submissions” which had earlier been made. It was therefore submitted that it was reasonably open to argument that counsel’s concession was not an unqualified assent to what his Honour “had put”.

5. In our view there is no merit in this submission either. It was not contested on the appeal that the effect of what counsel for the appellants had conceded in the exchange, to which reference has been made, did not amount to a live objection to the orders that the primary judge was being asked to make by both parties. Furthermore, the grounds of appeal set out at [35] of the principal judgment did not include any suggestion that what had been said by counsel in the exchange referred to had been misunderstood by the primary judge in any way and, in particular, had been other than a statement that the orders then sought by the Official Trustee were not objected to.

6. In any event, the numerous submissions advanced by the appellants on the appeal were, in our view, in no way founded either upon the fact that the second appellant had been wrongly joined in the proceedings initially or upon the concession made by counsel in the exchange extracted at [21] of the principal judgment.

7. In the foregoing circumstances we are of the view that the submissions of the appellants, in opposition to the making of an award of indemnity costs, have no more merit than the submissions made on the appeal and which, in our view, prima facie, justified the awarding of indemnity costs to the Official Trustee in respect of the costs of the appeal.

8. Accordingly, the Court orders that the appellants pay the first respondent’s costs of the appeal on an indemnity basis.

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Amendments

08 March 2016 - Catchwords - "PROCEDURE" amended to "PROCEDURE"

Decision last updated: 08 March 2016