Frigger v Mervyn Jonathon Kitay in his Capacity as Liquidator of Computer Accounting & Tax Pty Ltd (in liquidation) [No 3]
[2014] WASC 24
•30 JANUARY 2014
FRIGGER -v- MERVYN JONATHON KITAY IN HIS CAPACITY AS LIQUIDATOR OF COMPUTER ACCOUNTING & TAX PTY LTD (IN LIQUIDATION) [No 3] [2014] WASC 24
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2014] WASC 24 | |
| Case No: | CIV:2765/2010 | 26 NOVEMBER 2013 | |
| Coram: | ALLANSON J | 30/01/14 | |
| 17 | Judgment Part: | 1 of 1 | |
| Result: | Costs orders made Amended pleadings struck out | ||
| B | |||
| PDF Version |
| Parties: | ANGELA CECILIA THERESA FRIGGER ANGELA CECILIA THERESA FRIGGER AND HARTMUT FRIGGER IN THEIR CAPACITIES AS TRUSTEES OF THE FRIGGER SUPERANNUATION FUND HARTMUT HUBERT JOSEF FRIGGER MERVYN JONATHON KITAY IN HIS CAPACITY AS LIQUIDATOR OF COMPUTER ACCOUNTING & TAX PTY LTD (IN LIQUIDATION) COMPUTER ACCOUNTING & TAX PTY LTD (IN LIQUIDATION) |
Catchwords: | Practice and procedure Costs Applications for costs Apportionment of costs Whether costs to be fixed or taxed Turns on own facts Practice and procedure Amendments to originating summons filed without leave Pleadings in action commenced by originating summons Application to strike out Turns on own facts |
Legislation: | Rules of the Supreme Court 1971 (WA), O 20 r 2(2), O 21 r 3, O 21 r 5, O 21 r 6, O 32 r 4, O 58 r 27 Supreme Court Act 1935 (WA), s 37 |
Case References: | Astral Land Pty Ltd v Golden Commercial Pty Ltd [2012] WASC 274 (S) Glendinning v Cuzens [2009] WASCA 21 Huntingdale Village Pty Ltd (Receivers and Managers Appointed) v Corrs Chambers Westgarth [2011] WASC 44 Jeruth Pty Ltd v Haybale Pty Ltd [2004] VSC 319 Laing O'Rourke (BMC) Ltd (formerly Barclay Mowlem Construction Ltd) v Dampier Port Authority [2007] WASC 87 MacMahon Contractors Pty Ltd v Woodside Energy Ltd [No 2] [2009] WASC 11 Re The Minister for Immigration and Ethnic Affairs of the Commonwealth of Australia; Ex parte Lai Qin [1997] HCA 6; (1997) 186 CLR 622 Red Hill Iron Ltd v API Management Pty Ltd [2012] WASC 323 (S) Smith v Maloney (1998) 19 WAR 209 Warley Hospital Inc v Attorney-General for the State of Victoria [2011] VSC 145 Youlden Enterprises Pty Ltd v Health Solutions (WA) Pty Ltd [2006] WASC 161; (2006) 33 WAR 1 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- First Plaintiff
ANGELA CECILIA THERESA FRIGGER AND HARTMUT FRIGGER IN THEIR CAPACITIES AS TRUSTEES OF THE FRIGGER SUPERANNUATION FUND
Second Plaintiff
HARTMUT HUBERT JOSEF FRIGGER
Third Plaintiff
AND
MERVYN JONATHON KITAY IN HIS CAPACITY AS LIQUIDATOR OF COMPUTER ACCOUNTING & TAX PTY LTD (IN LIQUIDATION)
First Defendant
COMPUTER ACCOUNTING & TAX PTY LTD (IN LIQUIDATION)
Second Defendant
Catchwords:
Practice and procedure - Costs - Applications for costs - Apportionment of costs - Whether costs to be fixed or taxed - Turns on own facts
Practice and procedure - Amendments to originating summons filed without leave - Pleadings in action commenced by originating summons - Application to strike out - Turns on own facts
Legislation:
Rules of the Supreme Court 1971 (WA), O 20 r 2(2), O 21 r 3, O 21 r 5, O 21 r 6, O 32 r 4, O 58 r 27
Supreme Court Act 1935 (WA), s 37
Result:
Costs orders made
Amended pleadings struck out
Category: B
Representation:
Counsel:
First Plaintiff : In person
Second Plaintiff : In person
Third Plaintiff : No appearance
First Defendant : Mr B W Ashdown
Second Defendant : Mr B W Ashdown
Solicitors:
First Plaintiff : Lumlan & Associates
Second Plaintiff : In person
Third Plaintiff : No appearance
First Defendant : Holborn Lenhoff Massey
Second Defendant : Holborn Lenhoff Massey
Case(s) referred to in judgment(s):
Astral Land Pty Ltd v Golden Commercial Pty Ltd [2012] WASC 274 (S)
Glendinning v Cuzens [2009] WASCA 21
Huntingdale Village Pty Ltd (Receivers and Managers Appointed) v Corrs Chambers Westgarth [2011] WASC 44
Jeruth Pty Ltd v Haybale Pty Ltd [2004] VSC 319
Laing O'Rourke (BMC) Ltd (formerly Barclay Mowlem Construction Ltd) v Dampier Port Authority [2007] WASC 87
MacMahon Contractors Pty Ltd v Woodside Energy Ltd [No 2] [2009] WASC 11
Re The Minister for Immigration and Ethnic Affairs of the Commonwealth of Australia; Ex parte Lai Qin [1997] HCA 6; (1997) 186 CLR 622
Red Hill Iron Ltd v API Management Pty Ltd [2012] WASC 323 (S)
Smith v Maloney (1998) 19 WAR 209
Warley Hospital Inc v Attorney-General for the State of Victoria [2011] VSC 145
Youlden Enterprises Pty Ltd v Health Solutions (WA) Pty Ltd [2006] WASC 161; (2006) 33 WAR 1
1 ALLANSON J: These reasons deal with outstanding issues as to costs, and some miscellaneous procedural matters, following a series of interlocutory hearings in 2013 in which the question of costs was either reserved or adjourned.
2 The defendants apply for their costs on these applications:
1. the plaintiffs' application for the trial of a preliminary issue;
2. the determination of the defendants' entitlement to costs; and
3. the applications by the plaintiffs to join Mr Frigger as second plaintiff in his own right; to join the solicitor for the defendants, Mr Lenhoff, as a party; and to amend the originating summons and the statement of claim to include the claims against Mr Lenhoff and against Mr Kitay in his personal capacity.
3 The plaintiffs contest the defendants' application for costs, at least in part, and have also applied for costs in relation to a series of even earlier matters, most of them preceding the transfer of this action to my list, and none of which was determined following a hearing:
1. an application by the defendants to join the children of Mr and Mrs Frigger as plaintiffs;
2. the defendants' application to strike out the statement of claim and for summary judgment;
3. the defendants' application to strike out the reply and defence to counterclaim.
4 The plaintiffs also seek an order that they have the costs of the application to join Mr Frigger as a plaintiff in his personal capacity, that application having been opposed unsuccessfully by the defendants.
Application for trial of a preliminary issue: the history
5 On 16 November 2012, Mrs Frigger swore an affidavit requesting an order pursuant to O 32 r 4 of the Rules of the Supreme Court 1971 (WA) that there be a separate trial to determine who was the beneficial owner of two properties at the time of the appointment of Mr Kitay as liquidator of Computer Accounting & Tax Pty Ltd.
6 On 20 November 2012, Edelman J held a strategic conference. The matter was adjourned to a directions hearing on 12 December 2012, and no orders were made about a separate trial of issues.
7 On 27 November 2012, the plaintiffs filed a substituted statement of claim. On this occasion they were represented by solicitors, and the statement of claim is signed by counsel.
8 On 6 December 2012, the defendants filed a substituted defence and counterclaim.
9 On 11 December 2012, the defendants filed a minute of proposed orders in which they sought orders including that the children of Mr and Mrs Frigger be joined in their capacity as trustees of the Frigger Superannuation Fund. Alternatively, they sought a substantive written response to questions they had raised regarding the non-joinder of the children.
10 On 11 December 2012, the plaintiffs filed a minute of proposed orders, including an order that Mr Frigger be joined in his personal capacity as a plaintiff. In this minute, they included orders relating to the proposed trial of the preliminary issue, including orders for the defendants to file and serve affidavits in reply, and for the programming of a special appointment.
11 The directions hearing for 12 December was vacated, with directions relisted for 7 February 2013. Before that hearing, the plaintiffs gave notice that they were acting in person. They were now including Mr Frigger a second plaintiff in the heading of their court documents, although no order had been made joining him.
12 On 5 February 2013, the plaintiffs filed a substituted reply and defence to counterclaim, signed by Mr and Mrs Frigger.
13 There was a directions hearing on 15 February 2013. It appears that no substantive orders were made on that occasion.
14 A directions hearing on 13 March 2013 was adjourned to 18 March. On 18 March, Edelman J made orders in these terms:
1. The defendants' application of 18 March 2013 to strike out the substituted reply and defence to counterclaim be determined at a special appointment to be listed together with the plaintiffs' application for a trial of a preliminary issue.
2. The defendants and the plaintiffs to file and serve written outlines of submissions in support of the applications.
15 The costs of the directions hearing of 18 March were costs in the cause. This, so far as I can see, is the first occasion orders were made in relation to the application for trial of a preliminary issue.
16 On 26 March 2013, the plaintiffs filed a notice of change of solicitors.
17 There was a further directions hearing on 3 April 2013 in which the plaintiffs appeared in person. Orders were made that the defendants file and serve an amended substituted defence and counterclaim, and extending the time for the filing of submissions in the two interlocutory applications.
18 On 9 April 2013, the defendants filed an amended substituted defence and counterclaim. Aspects of this pleading became significant in the application for trial of a preliminary issue, as the defendants for the first time pleaded the entitlement of Computer Accounting & Tax, as trustee, to exercise rights of exoneration and to be indemnified out of trust property, and its entitlement to a lien over trust property.
19 In April 2013, it emerged that Mr and Mrs Frigger had purported to sell one of the properties in issue in the proceedings (the Armadale property). At about this time the action was transferred to my list. On 1 May 2013, I heard an application for an order that the plaintiffs be permitted to sell the property, and requiring the defendants to co-operate in the sale. I dismissed the application and made an order that the plaintiffs pay the defendants' costs of the application to be taxed or agreed.
20 On 10 May 2013, the plaintiffs gave notice that they were again acting in person. On 10 May 2013, they filed an amended substituted reply and defence to counterclaim in which they denied the plea that Computer Accounting & Tax and Mr Kitay were entitled to exercise rights of exoneration and to be indemnified out of the assets of the trust.
21 On 28 May 2013, I heard the application for a separate trial of a preliminary issue, and reserved my decision on it. The application to strike out the reply and defence to counterclaim was adjourned to directions on 14 June 2013, and the costs of the day were reserved.
22 On 13 June 2013, the defendants filed a minute of proposed orders including an order that the plaintiffs' substituted reply and defence to counterclaim be struck out with liberty to re-plead, and that the plaintiffs pay the defendants' costs of the application to strike out the substituted reply and defence to counterclaim, including reserved costs to be taxed and paid forthwith. Alternatively, they applied for orders that the application to strike out the substituted reply and defence to counterclaim be listed for a special appointment. One of the reasons the matter proceeded in this way was it appeared likely that counsel would consider the pleading, and at least parts of this substituted reply and defence to counterclaim would be amended. There were matters in the pleading which I did not anticipate competent counsel would seek to maintain. The plaintiffs had been represented at the application for trial of a preliminary issue by competent counsel, although he had not prepared the pleading.
23 On 14 June 2013, I published reasons and made orders dismissing the plaintiffs' application for the trial of a preliminary issue. I adjourned the costs of the application to 12 August 2013. On the same occasion, orders were made for the defendants to file any amendments to the defence and counterclaim by 28 June 2013, for the plaintiffs to file any substituted reply and defence to counterclaim by 23 July 2013, and for the costs of the application to strike out also to be adjourned to 12 August 2013. The matter was set down for a special appointment on that day for further directions and to deal with such costs issues as were outstanding.
24 On 11 July 2013 the plaintiffs filed an amended originating summons which effectively replaced the relief which had been sought in the originating summons commencing the proceedings. On 11 July 2013 the plaintiffs also filed an amended substituted statement of claim, consistent with the amended originating summons. Mr Frigger was again named as second plaintiff, although no orders had been made to that effect.
25 On 12 August 2013, I heard the application for costs and reserved my decision, while allowing the plaintiff leave to file further written submissions on the costs of the application for trial of a preliminary issue. The application for amendment of the statement of claim and re-amendment of the originating summons was adjourned to a special appointment on a date to be fixed.
26 On 11 October 2013, the defendants filed an affidavit, sworn by Mr Lenhoff on 10 October, opposing the joinder of additional parties to the proceedings. The affidavit was not directed to the procedural issue, but addressed the merits of the allegations that had been made in the amended substituted statement of claim. While I can understand the impulse to respond to those allegations, the affidavit was not relevant to the question that was to be determined.
27 On 22 October 2013, the plaintiffs instructed the firm of Lumlan and Associates. A practitioner from that firm appeared for the plaintiffs at the hearing before me on 23 October 2013. At that hearing I made orders allowing the application to join Mr Frigger as a party (third plaintiff), but otherwise dismissed the plaintiffs' application to join Mr Lenhoff, and to amend the originating summons and statement of claim. I reserved the costs of that application until the next directions hearing, to be held on a date to be fixed after 14 November.
28 On 23 October 2013, I handed down my decision that the plaintiffs were to pay the defendants' costs of the application to set down the trial of the preliminary issues, but deferred making orders to give the parties the opportunity to be heard on the wording of the orders, including whether there were any reserved costs.
29 On 25 October 2013, the court received a notice dated 24 October 2013 that the plaintiffs were now acting in person.
30 On 28 October 2013, I delivered reasons for the orders that I made on 23 October.
31 There was a directions hearing on 26 November 2013. The defendants filed a minute of proposed orders regarding the various interlocutory matters where costs were still outstanding. They also sought orders:
1. That the purported amended originating summons dated 10 July 2013, filed without leave, be struck out.
2. The amended substituted statement of claim filed 11 July 2013 be struck out.
3. The plaintiffs file and serve any amended substituted statement of claim on or before 13 December 2013.
4. The directions hearing in the action be adjourned to a date to be fixed.
32 On 26 November 2013 I adjourned the matter to a directions hearing on 31 January 2014.
The costs applications
The application to set down a preliminary question for hearing
33 I have already determined that the plaintiffs must pay the defendants' costs of the application for the trial of a preliminary issue. The remaining questions before orders are made are whether there were reserved costs, other than the costs reserved on the hearing of the application on 28 May 2013, and the form of the order.
34 Because the application began while this matter was being managed by another judge I was seeking the assistance of the parties regarding whether there were occasions when costs had been reserved to the final hearing, or costs orders had not been made. The defendants identified no reserved costs and, from my review of the file, I could find no occasion when that had been done other than on 28 May.
35 As to the form of the orders, the defendants request orders for the costs of the application including the costs 'of and incidental to' the hearings on 28 May and 14 June. The costs of the hearing on 28 May would follow an order for costs of the application. The costs of 14 June would also be included, but only to the extent they relate to that application - several other matters were dealt with on that day.
36 The inclusion of costs 'incidental to' the hearings adds nothing in the circumstances of this application. The power of the court pursuant to s 37 of the Supreme Court Act 1935 (WA) is as to 'the costs of and incidental to all proceedings in the Supreme Court'. There may be cases where an order for incidental costs is sought because there is uncertainty whether the order would extend to particular items if merely expressed as the costs of the application: see, eg, Warley Hospital Inc v Attorney-General for the State of Victoria [2011] VSC 145. There have been cases where an issue has arisen whether certain costs are 'of and incidental to' the proceedings, such as the costs of a private mediation: Red Hill Iron Ltd v API Management Pty Ltd [2012] WASC 323 (S); or the costs of conferral: Astral Land Pty Ltd v Golden Commercial Pty Ltd [2012] WASC 274 (S). The defendants have not identified any incidental matters to which the order should extend, and I am not aware of any other than the cost of conferral (if any). The order should be for the costs of the application to set down the trial of a preliminary issue, including the costs reserved on 28 May 2013.
37 The costs incurred in respect of the process of conferral should be recoverable: see Laing O'Rourke (BMC) Ltd (formerly Barclay Mowlem Construction Ltd) v Dampier Port Authority [2007] WASC 87 [34]. Item 24 of the determination provides a scale for such costs where conferral is required by order of the Court, by the Rules of the Supreme Court, or by practice direction.
38 I will include the costs of conferral, but with this qualification. There are now several statements by judges of this court that the obligation to confer is not substantively complied with unless and until legal representatives of the parties, with authority to resolve the particular interlocutory dispute in question, have orally conferred in respect of the substantive issues that arise in relation to that dispute, either by telephone or by meeting face to face: see, for example, Youlden Enterprises Pty Ltd v Health Solutions (WA) Pty Ltd [2006] WASC 161; (2006) 33 WAR 1 [5]. An order for the costs of conferral on an interlocutory application is not intended to include the solicitor's time costing for correspondence with the defendants' solicitors, or telephone conversations in which there was no actual discussion about how to resolve the interlocutory dispute before the court. If those matters are otherwise recoverable under items in the scale, it is not as a cost of conferral.
39 The order will be:
The plaintiffs jointly and severally pay the defendants' costs of the application to set down the trial of a preliminary issue, including the costs of the hearing on 28 May 2013 which were reserved, and including the costs of conferral between the parties in connection with the application, those costs to be agreed or taxed and paid forthwith.
The hearing on costs
40 There was the separate hearing to determine whether the defendants were entitled to costs in the action. I raised the question of that entitlement, having regard to an affidavit that had been filed by the defendants regarding the costs agreement between Mr Kitay (as liquidator) and a litigation funder. The matter proceeded to a contested hearing. The defendants were successful on the issue. The proper order is for the plaintiffs to jointly and severally pay the defendants' costs of the application, including the hearing on 12 August 2013.
41 The defendants have again asked for an order in terms of costs incidental to the application. I am of the view that an order for costs of the application is sufficient, and the words incidental to add nothing. In this particular instance, I am concerned that the words incidental to would have an unintended consequence. Following the question of their entitlement to costs being raised, the defendants arranged an amendment of their agreement with the litigation funder. The costs of amending the agreement are not costs of the application, nor are they costs incidental to it.
The application on 23 October 2013
42 The application heard on 23 October 2013 had several components. The plaintiffs were successful with regard to the application to join Mr Frigger as a plaintiff in his own right. The defendants opposed that order, even though they accepted that, under the pleadings that have been in place since May 2011, Mr Frigger should have been a party, and that they had previously complained that the absence of Mr Frigger was a defect in the proceedings.
43 The defendants did not challenge that the addition of Mr Frigger comes within the terms of O 18 r 6(2)(b) of the Rules of the Supreme Court. They took the technical point that Mr Frigger had not given written consent to be joined as a plaintiff, until that was corrected. The primary question argued on the application was whether Mr Frigger should first be required to provide an explanation on oath as to the basis of his claim. On that issue the plaintiffs succeeded.
44 On the same day, I heard the plaintiffs' applications to amend the originating summons and their pleadings to include claims against Mr Lenhoff (and to join him as a defendant), and claims against Mr Kitay. Those applications were dismissed and the defendants should have the costs of them.
45 In my opinion, there must be some adjustment made for that part of the application where the plaintiffs succeeded. The defendants say that the plaintiffs were seeking an indulgence of the court in adding a new party and should pay the costs of the application. That is not the way in which the matter proceeded. If it were simply a matter of joining Mr Frigger as a party, there would be an argument for an order that the plaintiffs pay any costs occasioned by that joinder. The basis on which the defendants opposed the joinder was a substantial and quite discrete issue.
46 I am not satisfied that it is an appropriate case to attempt to make an order that the defendants pay the costs of one issue and the plaintiffs pay the costs of the others. There can never be mathematical precision in these matters. But, having regard to the material that was filed and my assessment of the time taken at the hearing of the application, I believe that it is appropriate to make the adjustment by awarding the defendants only 80% of the costs of the application.
47 There is a further matter which requires some adjustment. Mr Lenhoff filed an affidavit dealing with the substance of the allegations which had been made against him. That affidavit was not appropriate to the application that was made, as the merits of matter pleaded in the proposed amendments were not in issue. The costs of the application should not include the costs of that affidavit.
Further orders
48 There are some incidental orders sought by the defendants. First, the amended originating summons dated 10 July 2013 and filed on 11 July was filed without leave and should be struck out. The amended substituted statement of claim filed on 11 July 2013 should also be struck out. The plaintiffs need to file an amended substituted statement of claim and that must be programmed. These are my reasons for those orders.
The proceedings
49 The proceedings were commenced in 2010 by an originating summons.
50 On 4 January 2011, a substituted summons was filed seeking:
1. an order pursuant to s 78 of the Trustees Act 1962 (WA) that the Perth property and the Armadale property vest in Mr and Mrs Frigger in their capacity as trustees of the Frigger Superannuation Fund;
2. a declaration that the defendants have no right, title or interest in the term deposit, or in interest in respect of it; and
3. orders regarding the plaintiffs' entitlement to repayment of a taxing fee.
51 Having regard to the nature of the issues, and the likely need to determine contested facts, it would have been preferable had it been commenced by writ. Under O 58 r 27, if an originating summons is not disposed of altogether on its first hearing, the court shall give directions as to the further conduct of the proceedings. The power to give directions under O 58 r 27 includes the power to order that the matter proceed as if commenced by writ of summons, and to order pleadings. When an order is made under O 58 r 27, the proceedings continue as if they had been commenced by writ: see Smith v Maloney (1998) 19 WAR 209.
52 On 21 January 2011, a registrar ordered that the matter proceed as if commenced by writ of summons. The plaintiffs filed a statement of claim on 11 March 2011. The substance of the relief sought was unchanged.
53 While the action proceeds as if commenced by writ, there has been nothing in the nature of an indorsement of claim. In Glendinning v Cuzens [2009] WASCA 21 [28], [29] the court identified important functions served by an indorsement, including:
1. it informs the defendant of the nature of the claim made and the relief sought;
2. it sets out the metes and bounds within which the statement of claim must be framed.
54 A statement of claim must not contain any allegation or claim in respect of a cause of action unless that cause of action is mentioned in the writ or arises from facts which are the same as, or include or form part of, facts giving rise to a cause of action so mentioned: O 20 r 2(2). I am not aware of any similar rule for matters commenced by originating summons. In principle, it appears to me that if the plaintiffs wish to plead matters that go beyond the material facts supporting the orders sought in the summons, they must amend the summons.
55 The current applications show that there has been some disregard of the need to confine the statement of claim to the relief sought in the originating summons, and how amendments should be managed. Order 21 r 6 provides that O 21 r 5 has effect in relation to an originating summons. That is, the court may allow a party to amend its writ or any pleadings on such terms as to costs or otherwise as may be just and in such manner as the court may direct. I intend to make the following directions to ensure that any future amendments are properly controlled:
1. The plaintiffs shall not further amend the originating summons or the statement of claim without leave. On any application for leave to amend the plaintiffs shall file a minute of the proposed amended summons or pleading.
2. The provisions of O 21 r 3 will apply to the amendment of any other pleading, that is the defence and counterclaim and the reply and defence to counterclaim.
56 In case it is necessary, I emphasise that the reply and defence to counterclaim is not a pleading in which the plaintiffs may advance claims for relief or causes of actions outside those in the summons and the statement of claim.
57 The purported amendment of the originating summons, filed without leave on 11 July 2013, should not stand. It would not be appropriate to correct the irregularity by granting leave to operate from the time of the amendment. Even were I to do that, the matters pleaded in the statement of claim would still fall outside the relief sought in the writ. The plaintiffs need to deal with the summons and the statement of claim together, to ensure that they are consistent.
58 The proposed statement of claim filed on 11 July 2013 should also be struck out as it seeks relief beyond that claimed in the originating summons.
59 If the plaintiffs wish to amend the originating summons to claim other relief, they must apply for leave to do so. I believe the best way to manage this is to direct that a minute of proposed amended summons and proposed substituted statement of claim be filed within a fixed time.
60 Turning to the orders required to deal with what has occurred:
1. The amended originating summons filed 11 July 2013, filed without leave, is struck out.
2. The amended substituted statement of claim filed 11 July 2013 is struck out.
3. The plaintiffs are to file and serve a minute of proposed amended originating summons and proposed substituted statement of claim on or before a date to be fixed.
4. The matter be listed for a further directions hearing on a date to be fixed, that date to be after the date fixed for filing of the minutes in the preceding order.
The orders sought by the plaintiffs
61 I have dealt with the costs of the application to join Mr Frigger as a plaintiff in his personal capacity.
62 There are three other matters on which the plaintiffs request an order for costs. They share the characteristic that none of them resulted in a hearing, and each was overtaken by events so that it became unnecessary for the court to determine the dispute.
63 Sometimes, when there has been no hearing on the merits, it is still possible to say that one party has succeeded and apply the general rule that the successful party is entitled to its costs. Sometimes it is possible, on the papers, to clearly discern which party would have been successful so that the agreement or compromise that renders the hearing unnecessary does not displace the usual order that the successful party have its costs. And sometimes it is apparent that one party has acted unreasonably. In such cases the court can fairly determine who should pay the costs: see, generally,Re The Minister for Immigration and Ethnic Affairs of the Commonwealth of Australia; Ex parte Lai Qin [1997] HCA 6; (1997) 186 CLR 622; Jeruth Pty Ltd v Haybale Pty Ltd [2004] VSC 319.
64 But none of those circumstances are found here. There has been no argument on the merits of any of these applications. It is not appropriate to attempt to determine what the outcome would have been without hearing argument, and it would also be a poor use of the court's resources to embark on that task. On the material available, including my consideration of what has been filed by the parties, I cannot determine that either party has acted unreasonably with regard to the issues identified by the plaintiffs.
65 I will make no order as to costs.
Should costs be fixed or taxed
66 I have considered whether the costs must be taxed. There are clear advantages in fixing costs. It is quicker. It is, or should be, cheaper for the parties. And it requires less use of the limited resources of the court. The court can only fix costs when it is satisfied that it can do so fairly. Sometimes this can be done, particularly when there is a draft bill and submissions, and the question is not complex. But the cost of receiving submissions can effectively negate some of the advantages in proceeding in this way.
67 Where it is not immediately apparent that costs can be fairly fixed, the only alternative is to order that they be taxed if not agreed. I am not satisfied that I could make any fair estimate to enable costs to be fixed on any of the applications, so I will order they be taxed.
68 The defendants ask for orders that the costs of the interlocutory applications be paid forthwith. Paragraph 3 of Consolidated Practice Direction 4.7.1 provides that as a general rule, where an order for costs is to be made against a party in interlocutory proceedings, the costs will be fixed and ordered to be paid forthwith or by a particular date. That direction recognises that, in exercising a discretion that is not otherwise confined, the usual practice of the court is to order that costs of interlocutory applications will be paid forthwith. The fact that the costs are to be taxed rather than fixed does not alter the power to order that they be paid forthwith: see, for example, Huntingdale Village Pty Ltd (Receivers and Managers Appointed) v Corrs Chambers Westgarth [2011] WASC 44 [35]; MacMahon Contractors Pty Ltd v Woodside Energy Ltd [No 2] [2009] WASC 11. In my opinion this is an appropriate case for costs to be payable forthwith, even though there probably must be a taxation. The several matters outstanding should be able to be dealt with in the one taxation.
Orders
1. The plaintiffs jointly and severally pay the defendants' costs of the application to set down the trial of a preliminary issue, including the costs of the hearing on 28 May 2013 which were reserved, and including the costs of conferral between the parties in connection with the application, those costs to be agreed or taxed and paid forthwith.
2. The plaintiffs jointly and severally pay the defendants' costs of the hearing of 12 August 2013, those costs to be agreed or taxed and paid forthwith.
3. The plaintiffs jointly and severally pay 80% of the defendants' costs of the hearing of 23 October 2013, those costs to be agreed or taxed and paid forthwith.
4. The plaintiffs shall not further amend the originating summons or the statement of claim without leave. On any application for leave to amend the plaintiffs shall file a minute of the proposed amended summons or pleading.
5. The provisions of O 21 r 3 will apply to the amendment of any other pleading, that is the defence and counterclaim and the reply and defence to counterclaim.
6. The amended originating summons filed 11 July 2013, filed without leave, is struck out.
7. The amended substituted statement of claim filed 11 July 2013 is struck out.
8. The plaintiffs are to file and serve a minute of proposed amended originating summons and proposed substituted statement of claim on or before a date to be fixed.
9. The matter be listed for a further directions hearing on a date to be fixed, that date to be after the date fixed for filing of the minutes in the preceding order.
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