Gekko Developments Pty Ltd v Centa Company Pty Ltd (No 4)

[2015] QSC 183

SUPREME COURT OF QUEENSLAND

CITATION:

Gekko Developments Pty Ltd v Centa Company Pty Ltd (No 4) [2015] QSC 183

PARTIES:

GEKKO DEVELOPMENTS PTY LTD
ACN 139 260 674

(plaintiff)

v
CENTA COMPANY PTY LTD
ACN 010 059 944

(defendant)

FILE NO/S:

SC No 7936 of 2012

DIVISION:

Trial Division

PROCEEDING:

Trial

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

26 June 2015

DELIVERED AT:

Brisbane

HEARING DATE:

Heard on the papers

JUDGE:

Philip McMurdo J

ORDER:

The plaintiff and Darren Brown pay the defendant’s costs of and incidental to the proceedings to be assessed upon the standard basis.

CATCHWORDS:

PROCEDURE – COSTS – DEPARTING FROM THE GENERAL RULE – ORDER FOR COSTS ON INDEMNITY BASIS – where the defendant should have its costs – whether the plaintiff’s conduct in continuing to prosecute the case so unreasonable as to warrant indemnity costs – where the plaintiff and another individual were ordered to pay the defendant’s costs of the proceeding assessed on the standard basis

Deepcliffe Pty Ltd & Anor v The Council of the City of Gold Coast & Anor[2001] QCA 396, cited
Gekko Developments Pty Ltd v Centa Company Pty Ltd (No 3) [2015] QSC 87, cited
Reeves v O’Reily[2013] QCA 285, cited
Tector v FAI General Insurance Co Ltd [2001] 2 Qd R 463; [2000] QCA 426, cited

COUNSEL:

No submission for the plaintiff

M Trim for the defendant

SOLICITORS:

ClarkeKann Lawyers for the plaintiff

McCullough Robertson Lawyers for the defendant

1. On 16 April 2015, I gave judgment dismissing the plaintiff’s claim.  I directed that written submissions be provided as to costs and this judgment deals with that subject. 

2. I have received a written submission for the defendant but none for the plaintiff.  The defendant submits that it should have its costs assessed on the standard basis until 27 January 2015 and from then on the indemnity basis.  That was the date on which its solicitors wrote to the plaintiff’s solicitors offering to settle the proceedings on the basis that the defendant pay $70,000 towards the plaintiff’s claim, pay a further $70,000 on account of the plaintiff’s costs and forego the enforcement of previous costs orders to the value of $69,476.95. 

3. Plainly, the defendant should have its costs.  But as its submissions rightly concede, the fact that the outcome was better for it than its Calderbank offer need not result in an order for indemnity costs.[1]

   [1]     Reeves v O’Reily [2013] QCA 285, 2 [3] citing Deepcliffe Pty Ltd & Anor v The Council of the City of Gold Coast & Anor [2001] QCA 396.

4. The defendant submits that an order for costs on the indemnity basis from the date of its offer is warranted because the plaintiff’s conduct in continuing the proceeding was, in effect, “plainly unreasonable”, as the necessary conduct of a party in this context was described in Tector v FAI General Insurance Co Ltd.[2]  The submissions for the defendant emphasised several factors which together made the plaintiff’s conduct in continuing to prosecute the case unreasonable:  the plaintiff’s case depended upon the acceptance of Mr Brown’s evidence without documentary support, his version was against the probabilities suggested by the surrounding circumstances, his version had changed in different editions of the plaintiff’s pleading, weaknesses in the plaintiff’s case had been suggested in interlocutory judgments and the offer was made close to trial so that the plaintiff should have known by then of its poor prospects of success. 

   [2] [2001] 2 Qd R 463, 464.

5. I accept that all of those matters are relevant.  But when considered together, they do not in my view make the plaintiff’s conduct in continuing to prosecute the case so unreasonable as to warrant indemnity costs.  It was not as if the plaintiff had no evidence to prove its case.  It failed because that evidence was not accepted.  And it was not the case that the defendant’s witnesses were certain to be believed.  As I said in the principal judgment, there were many reasons to question the credibility of Mr Yuen and Mr Deriard.[3]  Therefore the plaintiff will be ordered to pay costs but assessed in all respects on the standard basis.

   [3]     Gekko Developments Pty Ltd v Centa Company Pty Ltd (No 3) [2015] QSC 87, 19 [83].

6. In ordering security for costs in December 2013, the court received an undertaking from Mr Brown to consent to an order for costs against him which corresponded with any order for costs made against the plaintiff.  Therefore, there will be a like order against him.

7. The order will be that the defendant’s costs of the proceeding be paid by the plaintiff and by Darren Brown to be assessed on the standard basis.