Forrester v Island Industries Pty Ltd (No.2)
[2010] NFSC 2
•15 March 2010
SUPREME COURT OF NORFOLK ISLAND
Forrester v Island Industries Pty Ltd (No. 2) [2010] NFSC 2
Citation: Forrester v Island Industries Pty Ltd (No.2) [2010] NFSC 2 Parties: JOHN KENNETH FORRESTER v ISLAND INDUSTRIES PTY LTD and JOHN TERENCE BROWN File number(s): SC 4 of 2008 Judge: DOWNES J Date of judgment: 15 March 2010 Catchwords: COSTS – simple order preferable – defendants to pay one-quarter of plaintiff’s costs Date of hearing: 15 March 2010 Place: Sydney Division: GENERAL DIVISION Number of paragraphs: 16 Counsel for the Plaintiff: Mr G Lindsay SC Counsel for the Plaintiff: Mr A Lo Surdo Solicitor for the Plaintiff: Mr H Snow Counsel for the First and Second Defendants: Mr G Blake SC Counsel for the First and Second Defendants: Mr P Doyle Gray Counsel for the First and Second Defendants: Ms S Fendekian Solicitor for the First and Second Defendants: Mr J Brown
IN THE SUPREME COURT OF NORFOLK ISLAND
GENERAL DIVISION
SC 4 of 2008
BETWEEN: JOHN KENNETH FORRESTER
PlaintiffAND: ISLAND INDUSTRIES PTY LTD
First DefendantJOHN TERENCE BROWN
Second Defendant
JUDGE:
DOWNES J
DATE:
15 MARCH 2010
PLACE:
SYDNEY
REASONS FOR JUDGMENT
Reasons for judgment, in this claim pursuant to a deed providing for remediation work to repair damage done by quarrying on the plaintiff’s land, were given by me on 16 February last. These reasons left open the precise amount of the judgment to be entered in favour of the plaintiff and the question of what costs orders should be made. The parties have now made written and oral submissions relating to the costs and have agreed upon the amount of the judgment. The amount agreed on for judgment is $169,872.51. In due course I will enter judgment for that amount. I turn to the question of costs.
One begins, of course, with the proposition that costs follow the event and the event in this case is a judgment for a substantial sum of money in favour of the plaintiff. Nevertheless, the plaintiff claimed considerably more than the amount for which judgment will be entered. Indeed, at the time the proceedings were commenced and for a considerable time thereafter, the amount of the claim exceeded $4 million. Even at the end, the amount of the claim was close to $4 million. To the extent that the plaintiff persisted in its claim to a judgment for a liquidated sum, that liquidated sum was always in excess of $4 million.
The proceedings followed an unusual course procedurally. The defendants initially raised many defences and sought to amend the defences on a number of occasions. It is fair to say that the defences that were raised sought to draw benefit from any possibility that the proceedings might be resisted. Given the amount that was claimed, and the amount I have ultimately decided is appropriately awarded as damages, and the difference between the two, it may not be entirely surprising that the defendants were looking to such defences as were available to them.
It must also be mentioned that the defendants in the case management stage of the proceedings, right up until the hearing, did not perform well in complying with orders. These failures to comply with orders of the court inevitably involved additional costs so far as the plaintiffs are concerned. In their written submissions the plaintiffs have clearly set out the particular amendments, variations, and non-compliances that led to these additional costs on behalf of the plaintiff.
So, at the time the matter was ready for hearing, there were many issues in the case. There was evidence on all of these issues. At the commencement of the hearing, however, or shortly after the commencement of the hearing, the defendants determined to abandon all of the defences save defences as to the quantum of the amount claimed. It follows that, although a substantial period of time was undoubtedly devoted to the preparation of affidavits setting out the background of the matter and discussions, which might, for example, have been relevant to issues of rectification and the like, when the matter came on for hearing, the time of the hearing was confined very substantially to the remaining issues, which went to quantum. Nevertheless, most of the material was in fact read in the proceedings, and as my judgment shows, was relevant to an assessment of the issues.
There were two substantial issues which were left for determination in the proceedings. The first was what remediation work was appropriate and the second was how that work should be costed. The plaintiff failed in its case on most of the underlying sub-issues which led to a determination of these two issues. In particular, I took a different view on the construction of the deed to the construction which was urged upon me by the plaintiff. I also preferred the evidence of Mr Short, who gave expert evidence for the defendant, over Mr Newell, who gave expert evidence for the plaintiff, as to precisely what work should be carried out. Finally, I preferred the methods and costing of the defendants’ expert to the plaintiff’s. There was one issue which had a significant effect on the damages which I did determine in favour of the plaintiff. That was the question of what price should be incorporated for rock in the costing. I need not revisit that issue here because it is dealt with in some detail in my decision.
The result is that a substantial part of the hearing, which took place over two periods on Norfolk Island and in Sydney, was devoted to the issues on which the plaintiff was not successful. This was compounded, to my mind, by the plaintiff re-agitating an issue on which I understood agreement to have been reached on Norfolk Island, as to the amount of work that was to be carried out. My reasons for decision arrived at the conclusion that that agreement was properly reached and reflected the appropriate level of remediation. Indeed, in the result, that agreement not being pressed, the amount of compensation I found to be appropriate was less than the amount that would have been payable under the agreement because I found that some items, such as a picnic area, were not covered by the requirements of the deed for remediation.
As I said in my reasons for decision, it was a disappointment to me that a process of taking the evidence of experts concurrently, which is calculated to reduce the time and cost of a hearing in a court, should have the consequence of increasing the time and cost of the hearing. The consequence of what I understood to have been an agreement not being carried forward meant considerably more evidence and considerably more cross-examination.
This is a very unusual aspect of this case and one which I think bears taking into consideration on the question of costs; not, I hasten to add, in any way by reference to penalty, or any thinking of that kind, but simply because of the extra time that was added to the case, which would not have been available to the parties if what I had understood to be the agreement was carried out, or if there had been no agreement and the case had continued without any opportunity for an adjournment for further evidence. Modern thinking about costs of justice and the present thinking of the High Court of Australia on that issue seem to me to be pertinent.
The parties have prepared written submissions and draft forms of order which deal, in detail, with the items which, they say, fall on one or other side of the scale in terms of where the costs burden should lie. In addition, the parties have identified items which they say should attract costs of an indemnity nature, and I have been invited to make orders for costs which take these into account. This approach might lead to a result in which some costs were to be paid by the defendants to the plaintiff and other costs might be paid by the plaintiff to the defendants. In addition, specific isolated items of cost on both sides of this balance might be ordered to be paid on an indemnity basis.
This is not an attractive approach to me, given the time and cost that this case has already occasioned. Although an ordinary order for costs does, of course, leave the taxing officer with a duty to examine each item, it does seem to me that, if particular items are singled out in the order for costs, it invites greater attention to the detail of those items than might be the result of an ordinary order for costs.
The history of this case does not suggest that the parties will readily come to some agreement about how such a complicated order for costs should be assessed. It seems to me that a simpler approach to the assessment of costs is much more in the interests of the parties. However, such an approach requires me to assess the balancing issues that would be avoided if I were to make the more complicated order. Nevertheless, I think that the advantages and cost saving that I believe will follow from making a simple order justify my doing that, providing I believe that I can give a decision which achieves fairness between the parties, even if it is not steeped in the detail of individual items.
I have spent a good deal of time thinking about this matter and how it might be reflected in an order for costs. I have considered, in detail, the written submissions that were furnished last Friday by both parties, which address these items, and I have also considered their written submissions in reply. I start with the proposition that the prima facie rule is that costs follow the event, and it seems to me that, in consequence of that, the plaintiff must be entitled to some costs. Nevertheless, it seems to me that the matters that I have been adverting to in giving these reasons lead to the conclusion that it is inappropriate, notwithstanding the primacy of the proposition that costs should follow the event, that the plaintiff should have all his costs.
I see no need for any solicitor and client or indemnity order for costs, although I recognise the submissions lying behind that approach. In other words, costs thrown away by delays and amendments ought to be paid by the party responsible, and where there is no adequate explanation, solicitor and client or indemnity orders may well be appropriate. I have accordingly taken these matters into account and endeavoured to mould them into an overall order that will achieve the fair and proper result, so far as costs are concerned.
There is little more I can do to give reasons for the result I have arrived at, although I have weighed in the balance the competing considerations. It seems to me that the best result, taking into account the matters favourable to the plaintiff, favourable to the defendants, and taking all these matters into account in the context of the usual form of order, that the appropriate order for me to make is that the defendants pay one quarter of the plaintiff’s costs.
I accordingly enter judgment for the plaintiff against both defendants in the sum of $169,872.51. I order the defendants to pay one quarter of the plaintiff’s costs on a party and party basis.
I certify that the preceding Sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Downes. Associate: [Sgd]
Dated: 16 March 2010
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