Foundas v Arambatzis (Gross Sum Costs Order)

[2025] NSWCA 208

Court of Appeal

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Foundas v Arambatzis (Gross Sum Costs Order) [2025] NSWCA 208

Hearing dates:

8 September 2025

Date of orders:

8 September 2025

Decision date:

08 September 2025

Before:

Kirk JA

Decision:

The costs of the first respondent which are payable by the first and second applicants by order of the Court of Appeal made on 17 September 2024 are fixed in the gross sum of $16,000, pursuant to s 98(4)(c) of the Civil Procedure Act 2005 (NSW), which sum is payable in the first instance from the first applicant’s share of the net proceeds of the sale of the property at issue in the proceedings.

Catchwords:

CIVIL PROCEDURE – Costs orders – Applicant seeking gross costs assessment pursuant to section 98(4)(c) of the Civil Procedure Act 2005 (NSW) – Assessed gross sum of $16,000

Legislation Cited:

Civil Procedure Act 2005 (NSW), s 98(4)(c)

Legal Profession Uniform Law (NSW), ss 194(1), 206

Cases Cited:

Foundas v Arambatzis (No 3) [2023] NSWSC 1513

Foundas v Arambatzis (No 6) [2024] NSWCA 231

Gabrielle v Abood (No 4) [2023] NSWCA 100

Category:

Costs

Parties:

Cassiani Foundas (First Applicant)
Bill Foundas (Second Applicant)
Peter Arambatzis (First Respondent)
Sean Magnus Wengel (Second Respondent)
Robert William Whitton (Third Respondent)

Representation:

Counsel:
Second Applicant (Self-represented)
T Harris-Roxas (First Respondent)

Solicitors:
Not applicable (Applicants)
Cutri & Associates (First Respondent)
William Roberts Lawyers (Second and Third Respondents)

File Number(s):

2024/4529

 Decision under appeal 

Court or tribunal:

Supreme Court of New South Wale

Jurisdiction:

Equity – Commercial List

Citation:

[2023] NSWSC 1513; [2023] NSWSC 1648; [2024] NSWSC 400

Date of Decision:

06 December 2023

Before:

Rees J; Kunc J

File Number(s):

2021/297960; 2018/184682

JUDGMENT

1. The first respondent (Peter Arambatzis), by notice of motion, seeks a gross sum order in relation to a costs order made by this Court on 17 September 2024. On that date the Court dismissed the motion of the applicants seeking a stay of execution of a writ of possession of a property of which the first applicant (Cassiani Foundas) and first respondent were registered proprietors as tenants in common: Foundas v Arambatzis (No 6) [2024] NSWCA 231. The Court ordered that the applicants pay the costs of the motion. The current motion for a gross sum costs order was filed almost a year ago on 26 September 2024. No procedural steps were taken in relation to that motion until June this year due to an administrative oversight. The first respondent did not take any further action to agitate or pursue the motion until relatively recently.

2. The motion was then listed on 23 June 2025, which listing was vacated. On 24 June 2025, the Registrar listed the motion for hearing on 30 June 2025, directing the parties to file and serve any evidence and written submissions by midday on 27 June 2025. That listing was also vacated, and the matter was listed for directions the following week; the first respondent was directed to notify all other parties of the orders. On 2 July 2025 the Registrar made the following orders:

1. Respondents (Cassiani Foundas and Bill Foundas) to the Notice of Motion filed 26 September 2025 (“Motion”) to file and serve evidence and Written Submissions in relation to the Motion by 6 August 2025.

2. Motion stood over for further Directions on 11 August 2025 at 9:30AM, which may be vacated if order 1 has been complied with.

3. Motion listed for Hearing on 18 August 2025.

4. Grants liberty to restore on 3 days’ notice.

5. Applicant (Peter Arambatzis) on the Motion to notify all other parties of these Orders. For the purposes of notification to the Respondents, the email address [second applicant’s email address] and mobile telephone number [second applicant’s mobile phone number] may be used.

3. On 15 July 2025, the second applicant (Bill Foundas) filed his own motion seeking amongst other things, the dismissal of the Registrar’s orders of 2 July 2025 and permission to attend the property which was the subject of this Court’s judgment in Arambatzis v Foundas (No 6) in order to obtain some documents. In relation to the dismissal of the Registrar’s orders, it appears that the second applicant was in substance seeking that the first respondent’s motion be dismissed. The second applicant’s motion was determined on 21 July 2025 by Price AJA. His Honour granted the applicants access to inspect the relevant property but otherwise dismissed the notice of motion.

4. The first respondent’s motion returned for a directions hearing before the Registrar on 11 August 2025, which hearing was attended by both the second applicant and a representative of the first respondent, as well as a representative for the trustees for sale of the relevant property (the second and third respondents). The Registrar made the following relevant orders concerning the first respondent’s motion:

1. Vacates the Hearing on 18 August 2025 of the Motion filed 26 September 2024 (“Motion”).

2. Notes the agreement between the Trustees and the Respondents that, on 21 August 2025 between 1:00 PM and 4:00 PM, the Respondents may attend the property at 12 Magee Street Ashcroft for:

a. the purpose of inspection of any documents that may remain there; and

b. the return to the Respondents of any documents that were not soiled.

3. Motion listed for further directions on 25 August 2025 at 9:30 AM, which may be vacated if the parties notify the Registrar via email that order 2 above has been complied with.

4. Extends time for the Respondents to file and serve evidence and Written Submissions in relation to the Motion to 12:00 midday on 5 September 2025.

5. Motion listed for Hearing on 8 September 2025.

5. The matter returned before the Registrar for directions on 25 August 2025, no submissions from the applicants having been filed. Neither of the applicants appeared. The Registrar made the following orders:

1. Notes compliance with order 2 made 11 August 2025.

2. Notes the extension of time granted for the Respondents to file and serve evidence and Written Submissions in relation to the Motion to 12:00 midday on 5 September 2025.

3. Notes the Motion is listed for Hearing on 8 September 2025.

4. Grants liberty to restore on 3 days’ notice.

5. Registry to notify all parties of these Orders.

6. Letters notifying both applicants of these orders were sent on 25 August 2025 to the email address referred to at [2].

7. At 1:13pm on 5 September 2025, having not received the applicants’ submissions as directed, the Registrar emailed the second applicant notifying him, amongst other things, that any evidence or written submissions had been due at midday that day and that the motion would proceed to hearing on 8 September 2025. The second applicant filed written submissions shortly thereafter. No submissions were filed by the first applicant, but the second applicant said, and I accept, that his submissions were also meant to be put on her behalf.

8. At the hearing of the motion this morning the first respondent was represented by counsel; the second applicant appeared by telephone; and the first applicant did not appear, with the second applicant explaining that she was attending a medical appointment. The second applicant said, and I accept, that she was aware of the hearing this morning. The appearance of the trustees was mentioned by counsel appearing for the first respondent. An affidavit sworn on 25 September 2024 by the first respondent’s solicitor, Mr Frank Cutri, was read in support of the motion.

9. In Gabrielle v Abood (No 4) [2023] NSWCA 100, this Court summarised the relevant principles concerning the discretion to make a gross sum costs order:

[6] The power to make a gross sum costs order provided by s 98(4)(c) of the Civil Procedure Act 2005 (NSW) is discretionary. Authority establishes that the discretion is not confined and may be exercised whenever the circumstances warrant its exercise; it should only be exercised when the Court considers that it can do so fairly between the parties, and that includes having sufficient confidence in arriving at an appropriate sum on the materials available; courts have typically applied a discount in assessing costs on a gross sum basis; and the court is not required to undertake a detailed examination of the kind that would be appropriate to taxation or formal costs assessment: see Hamod v New South Wales [2011] NSWCA 375 at [813]-[820] and authority there cited.

10. The first respondent seeks a gross sum costs order in the amount of $16,997.89, or such other amount as the Court determines. I am persuaded that a gross sum order is appropriate and in the interests of justice in relation to the costs order made by the Court of Appeal on 17 September 2024 taking account of the following:

1. It seems unlikely that the applicants will be able to satisfy the costs order, noting that the first applicant has previously obtained pro bono referrals on more than one occasion; that two previous gross sum orders made in favour of the first respondent against the first applicant for $210,000 and $11,766.15 have not been paid; nor have other costs orders made against the first applicant been paid. Moreover, the second applicant says that he is homeless. In the circumstances, a detailed assessment of the costs liability would be of limited utility.

2. The amount claimed is relatively small.

3. The first respondent himself has very limited financial means.

4. Proceedings relating to the property in dispute were first commenced in the Supreme Court over seven years ago and have been protracted: note Foundas v Arambatzis (No 6) at [4]-[44].

5. The material provided in the affidavit of Mr Cutri provides sufficient information to arrive fairly at an appropriate sum.

11. The second applicant made various arguments as to why no such order should be made. He submitted that the first respondent was seeking costs he was “not entitled to”. That is not so; he is entitled to costs pursuant to the order made on 17 September 2024. In oral submissions the second applicant argued, in effect, that the dispute about whether or not to stay the writ of possession was between the applicants and the trustees, and that the first respondent should have no right to costs arising from that dispute. However, the Court’s order was that the motion seeking the stay of the writ was dismissed with costs, and that order was not limited to the trustees. Furthermore, the first respondent had a legitimate interest in seeking that the sale of the property proceed and thus opposing the application for a stay of the writ.

12. The second applicant argued that it was unfair for the trustees to rely on the first respondent’s application when they were supposed to be impartial. That submission seemed to manifest confusion. The motion before me relates only to quantifying the costs incurred by the first respondent in relation to a particular application before this Court, being the application for a stay of the writ of possession. It does not involve the trustees or their costs. For the same reason the second applicant’s submission that the trustees “should be thrown out” is not to the point.

13. The second applicant said that the application is premature when the matter has not yet concluded. I understand him to be referring to the fact that an appeal to this Court from orders made in Foundas v Arambatzis (No 3) [2023] NSWSC 1513 has been stayed pending resolution of some criminal proceedings. He said that the criminal proceedings have been listed for hearing in March 2026. Yet even if that appeal were to be upheld in due course it would not affect the costs order in question, which was made by the Court of Appeal in dismissing the application for stay of execution of a writ of possession.

14. The second applicant submitted that the first respondent “has not paid a single cent in these proceedings” and this was a case of counsel and the trustees getting “rich for no work at all”. Relatedly, the second applicant noted that under s 206 of the Legal Profession Uniform Law (NSW) (Uniform Law), a law practice may take reasonable security from a client for legal costs. He has asserted that this should have been, but was not, done by Mr Cutri’s firm. His complaint seems to be that it is unfair that the first respondent has obtained legal representation when he did not have the means to pay for it. He said “Peter needs to pay his way; that’s the way the Constitution and legal representation works”. Whether or not the lawyers involved have acted on a no win no fee basis in this matter is of no relevance to consideration of the motion (noting that no uplift has been claimed by the lawyers involved). Insofar as the second applicant is claiming that the fees are excessive, that is a matter which I can consider given that Mr Cutri’s affidavit attaches the relevant invoices of his firm and the two counsel involved.

15. The second applicant asserted that, contrary to the requirements of Uniform Law, the first respondent had not been issued with cost disclosures or invoices. That is not so. Annexed to Mr Cutri’s affidavit are cost disclosure agreements from his own law firm and the two counsel, along with invoices from each of them.

16. The second applicant invoked s 194(1) of the Uniform Law, which provides that a law practice “must not commence legal proceedings to recover legal costs from a person unless a bill has been given for the legal costs and the bill complies with the requirements of this Law and the Uniform Rules”. The current motion does not involve any proceedings having been commenced by a law practice against a person, and in any event the second applicant has not identified any relevant failure to comply with the applicable legal requirements.

17. As regards the amount of the order, Mr Cutri has identified an amount of $10,945 of costs charged by his firm which relate to the stay of execution motion that was before this Court. Having considered his invoice, I accept that sum. Mr Cutri then applied a discount of 40% to that sum, 30% relating to a common discount when costs are assessed and a 10% buffer reflecting the fact that this is a gross sum procedure. That leads to a figure of $6,567.00. I accept that is an appropriate sum for his costs.

18. Two junior counsel together represented the first respondent at the hearing of the stay of execution motion, Mr Denis Barlin and Ms Tanya Harris-Roxas. They have each issued invoices relating to work done with respect to that motion, along with a related issue relating to a potential contempt application. That application did not proceed, and amounts relating to that issue are not currently sought. The remaining amounts in question were $6,978.13 for Mr Barlin and $4,611.75 for Ms Tanya Harris-Roxas. Having reviewed their invoices, I consider these amounts to be reasonable. Mr Cutri has then discounted each of those sums by 10% as a buffer for the gross sum process, but working on the implicit assumption that counsels’ fees would likely be allowed in full on an assessment process.

19. Although not raised by the applicants, there could be room for argument as to whether two counsel were required given the nature of the stay of execution motion. However, I infer from the materials before me that Mr Cutri’s firm is a small one; that this matter was run on relatively lean basis; and that it was efficient and cost-effective for some of the work that might otherwise have been done by a senior solicitor to have been done by a second junior barrister. For example, one of the time entries for Ms Harris-Roxas refers to her drafting an affidavit of Mr Cutri. Moreover, the overall sum claimed – $16,997.89 – is not substantial. In the circumstances I accept that a figure of that order represents an appropriate amount to be ordered by way of a gross sum costs order, although I will round it down to $16,000.

20. The first respondent seeks that the order provides that the sum be payable in the first instance from the first applicant’s share of the net proceeds of sale of the property. Counsel for the first respondent informed me that the property was now listed for sale by auction in early October. I did not understand the second applicant to dispute that point. The second applicant has submitted that the “sale of property cannot be the only source of income” but did not identify any other potential source by which either applicant would be able to meet the costs order. I see no reason not to grant the first respondent’s request, taking account of the fact that the dispute between the first applicant and the first respondent has always centred on the property.

21. The order of the Court is as follows:

1. The costs of the first respondent which are payable by the first and second applicants by order of the Court of Appeal made on 17 September 2024 are fixed in the gross sum of $16,000, pursuant to s 98(4)(c) of the Civil Procedure Act 2005 (NSW), which sum is payable in the first instance from the first applicant’s share of the net proceeds of the sale of the property at issue in the proceedings.

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Amendments

08 September 2025 - Correction to typographical error in coversheet.

Decision last updated: 08 September 2025