G&S Engineering Services Pty Ltd v MACH Energy Australia Pty Ltd (No 2)

[2019] NSWSC 463

Supreme Court

New South Wales

Medium Neutral Citation:	G&S Engineering Services Pty Ltd v MACH Energy Australia Pty Ltd (No 2) [2019] NSWSC 463
Hearing dates:	On the papers
Decision date:	26 April 2019
Jurisdiction:	Equity - Technology and Construction List
Before:	Stevenson J
Decision:	The costs ordered on 18 April 2019 be assessed and payable forthwith
Catchwords:	COSTS – party/party – costs orders in interlocutory proceedings – whether costs should be payable forthwith
Legislation Cited:	Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited:	Fiduciary Ltd v Morningstar Research Pty Ltd (2002) 55 NSWLR 1; [2002] NSWSC 432 G&S Engineering Services Pty Ltd v MACH Energy Australia Pty Ltd [2019] NSWSC 407 Pavlovic v Universal Music Australia Pty Ltd (No 2) [2016] NSWCA 31
Texts Cited:	Practice Note SC Eq 3
Category:	Costs
Parties:	G&S Engineering Services Pty Ltd (First Plaintiff) DRA Pacific Pty Ltd (Second Plaintiff) MACH Energy Australia Pty Ltd (First Defendant) MACH Mount Pleasant Operations Pty Ltd (Second Defendant) JCD Australia Pty Ltd (Third Defendant)
Representation:	Counsel: M Christie SC with D Hume and B Wacker (Plaintiffs) D T Miller SC with N Simpson (Defendants)   Solicitors: Jones Day (Plaintiffs) Corrs Chambers Westgarth (Defendants)
File Number(s):	SC 2019/71358

Judgment

1. On 18 April 2019 I ordered that the defendants be restrained from calling on four surety bonds. My reasons for making that order are set out in my judgment of 11 April 2019: G&S Engineering Services Pty Ltd v MACH Energy Australia Pty Ltd [2019] NSWSC 407.

2. I shall use the same abbreviations here as in that judgment.

3. Also on 18 April 2019, and by consent, I ordered that the MACH interests pay the Contractors’ costs of the interlocutory application.

4. The Contractors seek an order that those costs be payable forthwith.

5. Rule 42.7(2) of the Uniform Civil Procedure Rules 2005 (NSW) provides that costs of an application made in proceedings “do not become payable until the conclusion of the proceedings” unless the court “orders otherwise”.

6. However, as these proceedings were commenced in the Technology & Construction List, Practice Note SC Eq 3 applies. Paragraph 57 of that Practice Note provides:

“Unless otherwise ordered, a party in whose favour an order for costs is made may proceed to assessment of such costs forthwith.”

7. Although par 57 of the Practice Note directs attention to when the costs of an interlocutory order may be assessed, as opposed to when those costs are paid (cf UCPR r 42.7(2)) there would, in most if not all cases, be little point in ordering that the costs the subject of an interlocutory costs order be assessed forthwith unless those costs were also to be payable forthwith.

8. Both parties pointed to authority to the effect that the relevant considerations as to whether costs should be payable forthwith include whether:

1. the interlocutory decision represents “the determination of a separately identifiable matter or may be viewed as the completion of a discrete aspect” of the case: Fiduciary Ltd v Morningstar Research Pty Ltd [2002] NSWSC 432; 55 NSWLR 1 at [11] (Barrett J); Pavlovic v Universal Music Australia Pty Ltd (No 2) [2016] NSWCA 31 at [15] (Bathurst CJ, Beazley P and Meagher JA); and

2. “there is still some considerable distance to go in the litigation so that it may be appropriate that the successful party obtain the fruits of its costs order now”: Fiduciary at [13]; Pavlovic at [15].

9. In my opinion, the interlocutory hearing before me was a “separately identifiable matter” the resolution of which was “the completion of a discrete aspect” of this case. I do not think that the prospect that issues that were debated before me on an interlocutory basis may be re-agitated at the final hearing alters this conclusion.

10. The question before me was narrow. It was whether, pending final determination of the proceedings, the MACH interests should be restrained from calling on the surety bonds. Argument about that question took two days and involved detailed consideration of a range of factual and legal questions. I decided the MACH interests should be so restrained. That chapter of this dispute is now closed.

11. As the Contractors submitted, the fact that a separate costs order has been made in respect of the interlocutory hearing, with the consent of the MACH interests, is itself indicative that the interlocutory hearing was discrete.

12. It is also clear that there is “still some considerable distance to go” in this litigation. There is a significant construction dispute to be resolved.

13. Both parties pointed to the allegedly precarious financial position of the other to make the point that a costs order obtained by the ultimately successful party may be of little or no value.

14. But, here, the Contractors have a costs order. In those circumstances, it is the financial position of the MACH interests that is of greater moment. I summarised the evidence about that matter at [75] to [76] of my judgment of 11 April 2019. That evidence, in my opinion, is a further reason to make the order sought by the Contractors. If the Contractors had to wait until the conclusion of these proceedings to enforce the costs order they have now obtained, the value of that order may well be diminished.

15. I order that the costs the subject of my order of 18 April 2019 be assessed and payable forthwith.

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Decision last updated: 26 April 2019