Giacci v Giacci
[2006] WASC 239 (S2)
GIACCI -v- GIACCI & ANOR [2006] WASC 239 (S2)
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2006] WASC 239 (S2) | |
| Case No: | COR:298/2005 | 3 AUGUST 2006 | |
| Coram: | MARTIN CJ | 3/08/06 | |
| 5/06/07 | |||
| 6 | Judgment Part: | 1 of 1 | |
| Result: | No order as to costs including no order as to costs reserved | ||
| B | |||
| PDF Version |
| Parties: | ANTONIO CARMINO GIACCI MARIO MICHELE GIACCI PETER LOUIS GIACCI |
Catchwords: | Costs Costs of proceedings and further directions hearings required to refine settlement terms Rules of the Supreme Court 1971 (WA), O 66 r 1 |
Legislation: | Rules of the Supreme Court 1971 (WA), O 66 r 1 |
Case References: | Nil |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
DECISION : 5 JUNE 2007 FILE NO/S : COR 298 of 2005 BETWEEN : ANTONIO CARMINO GIACCI
- Plaintiff
AND
MARIO MICHELE GIACCI
First Defendant
PETER LOUIS GIACCI
Second Defendant
Catchwords:
Costs - Costs of proceedings and further directions hearings required to refine settlement terms - Rules of the Supreme Court 1971 (WA), O 66 r 1
Legislation:
Rules of the Supreme Court 1971 (WA), O 66 r 1
(Page 2)
Result:
No order as to costs including no order as to costs reserved
Category: B
Representation:
Counsel:
Plaintiff : Mr M L Bennett
First Defendant : Mr R E Keen
Second Defendant : Mr R E Keen
Solicitors:
Plaintiff : Lavan Legal
First Defendant : Taylor Smart
Second Defendant : Taylor Smart
Case(s) referred to in judgment(s):
Nil
(Page 3)
1 MARTIN CJ: On 3 August 2006, I gave the reasons for my conclusion that the defendants purchase the shareholding of the plaintiff in Giacci Holdings Pty Ltd ("the Company") for a sum of $8 million. A number of further directions hearings were necessary to refine the terms of the orders finally made by me in respect of the disposition of the plaintiff's shareholding in the Company. For a time, there was uncertainty as to whether or not the transaction would proceed, as it was dependent upon the provision of finance to the defendants. When that uncertainty was resolved, I directed that the parties exchange written submissions in respect of the orders that should be made in relation to the costs of the proceedings, and they have now done so. This decision is entirely concerned with those issues as to costs.
2 The starting point for any consideration of the exercise of the Court's discretion in respect of costs is the general principle, reflected in the Rules of the Supreme Court 1971 (WA) O 66 r 1, to the effect that while the Court's discretion is unconstrained, the Court will generally exercise that discretion by ordering that the successful party to any proceedings recover their costs.
3 It is difficult, if not impossible, to apply that general approach to these proceedings because, by the time the matter came on for hearing before me in late May of 2006, the parties were agreed as to the appropriate form of relief to be granted; namely, relief in the form of an order that the defendants purchase the plaintiff's shareholding in the Company. There was therefore no contest as to the substantive form of the relief to be granted – only as to its terms. The most significant of the remaining issues was, of course, the price to be paid for the shares, but there were a variety of other subsidiary issues relating to the terms upon which the transaction should proceed, including issues relating to compensation for delay in settlement.
4 In these circumstances I agree with the submissions of all parties, to the effect that the appropriate course is to segregate the proceedings into distinct phases, and to consider distinct issues, for the purposes of evaluating the proper exercise of the Court's discretion in respect of costs. However, in undertaking this exercise, it is, I think, important to avoid an overly detailed approach, descending to minutiae. Instead, it is preferable to remember that the Court's discretion in respect of costs remains a broad and general power, to be exercised in accordance with the substantial justice of the case, rather than by reference to an overly pedantic and detailed analysis.
(Page 4)
5 The first phase of the proceedings to be considered is the phase between their commencement in late 2005, and 31 March 2006, at which time the defendants made an offer, conditional upon the provision of finance within three months of the date of acceptance, to purchase the plaintiff's shares in the Company for a sum of $8 million. The price was later said to include an unspecified allowance for any costs to which the plaintiff might then be entitled. The offer included a term to the effect that if finance was not provided within the time specified, the defendants would agree to a sale of the business of the company, in a manner to be agreed. The offer was rejected immediately.
6 During the period prior to the defendants' offer, there were two applications brought by the plaintiff for an interlocutory injunction. It is now clear that both were based on a false premise as to the terms of the Company's constitution. While one might be inclined to order that the plaintiff should pay the defendants' costs of those applications, the other costs that were being incurred over this period reflected work being done by the plaintiff to move the proceedings forward, to the point where an offer to purchase his interest in the Company was made, and which might therefore have justified an order in his favour in respect of those costs. I also bring to account my view that the evidence adduced before me established that the defendants had acted in a high-handed and imperious way towards the plaintiff throughout this period, having evicted him from any meaningful role in the management of the Company.
7 The next identifiable phase in these proceedings is the period between 31 March 2006 and the commencement of the hearing in late May 2006 when counsel for the defendants advised the Court that their offer had been withdrawn (if indeed it was in fact open, given its earlier rejection).
8 The next identifiable phase in the life of these proceedings is the period between the time immediately prior to the commencement of the hearing before me in late May, when the plaintiff announced he would accept an order that the defendants purchase his shares, and the delivery of my decision on 3 August 2006.
9 That phase of the proceedings was concerned with the hearing which was primarily directed to issues of value. Most, but not all of those issues were resolved in favour of the defendants. In late May, the defendants reinstated their offer on the same terms. It remained open until 12 July 2006.
(Page 5)
10 The final phase of the proceedings is the period between the delivery of my reasons on 3 August 2006, and consummation of the transaction in November 2006. Much of that period was concerned with regular directions hearings occasioned sometimes by prevarication on the part of the defendants, including what I thought to be an unreasonable refusal to provide information to the plaintiff, and arguments in respect of compensation for delay which I resolved in favour of the plaintiff.
11 When a Court's discretion as to costs falls to be exercised by reference to particular periods and particular issues, as it does in this case, it is, I think, important to exercise a broad discretionary judgment, rather than to make overly detailed orders which will result in elaborate and complicated processes of taxation. In many instances this process will result in countervailing amounts being due from each party which would cancel each other out. Thus, in a situation such as this, I think it preferable to approach the exercise of the discretion as a matter of art rather than science.
12 Taking that approach, it seems to me that in the first phase to which I have referred, the balance between the parties is relatively even, in that on the one hand, the plaintiff made applications for interlocutory relief which lacked foundation, on the other hand the plaintiff was incurring the cost of moving the case forward to the point where agreement in principle as to its disposition was reached.
13 During the next two phases of the case, the balance swings much more in favour of the defendants who made an offer (albeit conditional) to settle in terms which were not dissimilar to those at which I arrived, and who were substantially, but not entirely, successful in relation to the valuation issues ventilated at trial.
14 During the final phase of the proceedings, the balance swings strongly in favour of the plaintiff, due to the procrastination and prevarication on the part of the defendants over that period.
15 Adopting a broad and unscientific approach to these issues, it seems to me that the swings and roundabouts to which I have referred largely cancel each other out, and that in these circumstances, the proper exercise of my discretion is to make no order as to costs. I am reinforced in that conclusion by the observation that these proceedings came about as a result of a regrettable breakdown in family relationships. It was not the function or responsibility of the Court to investigate or allocate fault for that breakdown. In a very real and substantive sense, all the parties' costs
(Page 6)
- of the proceedings can be said to be attributable to that breakdown in relationships, and are, to a very real extent, the inevitable consequence of that breakdown. As there has been no determination as to responsibility for that breakdown, it seems not inappropriate that the parties should, in the result, end up bearing their own costs of these proceedings.
16 Accordingly, for these reasons, I order that there be no order as to the costs of these proceedings, including no order as to all costs reserved.
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