Gibbs Holdings P/L v Mercantile Mutual Insurance (Australia) Ltd

[2001] QCA 481

[2001] QCA 481

COURT OF APPEAL

de JERSEY CJ
MACKENZIE J
CHESTERMAN J

Appeal No 10818 of 1999

GIBBS HOLDINGS PTY LTD  Appellant

and

MERCANTILE MUTUAL INSURANCE (AUSTRALIA)
LIMITED  First Respondent

and

INSURANCE AND GENERAL BROKERS SERVICES
PTY LTD  Second Respondent

BRISBANE

..DATE 05/11/2001

JUDGMENT

CHESTERMAN J:  The appellant brought an action for damages against the first defendant, an insurance company, and the second defendant, an insurance broker.  It failed against both.

On 22 December 2000 an appeal succeeded but only against the second respondent.  In delivering judgment the Court gave the parties liberty to apply with respect to costs. 

In its written submissions delivered for the purposes of the appeal, the appellant had sought an order "that whichever respondent is held liable to the appellant should pay the appellant's costs of the action against both respondents".

Pursuant to leave granted to argue the question of costs, the appellant sought an order that the second respondent should indemnify it against the costs it was obliged to pay the first respondent, against whom had failed both in the first instance and on appeal.

Those written submissions, having recited the terms of the earlier submission which I have quoted, then sought orders "(1) that the second respondent pay the first respondent's costs of the trial, and (2) the second respondent pay the appellant's costs of the trial of the action".

The second respondent's written submissions picked up the appellant's terminology.  Those submissions dealt with costs in separate categories, "trial" and "appeal" costs.

The Court made further orders on 23 February this year namely that:  "(1) the appellant pay the first respondent's costs of the trial and appeal to be assessed (2) the second respondent pay the appellant any sum paid by the appellant in respect of the first respondent's costs of trial, and
(3) the second respondent pay the appellant's costs of trial".

When costs came to be assessed, the Registrar formed the opinion, not unjustifiably, that costs of trial were more limited than costs of the action and that the order of the Court of Appeal limited the recovery of costs to those incurred with respect to the trial itself.

The Uniform Civil Practice Rules Part 2 division 1 speaks of the costs of the proceedings rather than the costs of an action or costs of a trial.  Those costs obviously include costs of initiating proceedings, complying with interlocutory steps and preparing for trial.

There is no discernible reason why the order made with respect to the hearing of the action which led to the judgment appealed against should have been limited to the costs of the trial itself.  It is likely that the Court picked up the terminology used by the parties, who did not direct their attention with enough precision to the order they actually wanted or to the term used by the rules.

I would therefore propose that the orders made by the Court on 23 February 2001 be amended by replacing the term "cost of trial" wherever it appears with the term "costs of the proceedings".

I would propose there be no order as to the costs of this application.

THE CHIEF JUSTICE:  I agree.

MACKENZIE J:  I agree.

THE CHIEF JUSTICE:  The order will be as indicated by
Mr Justice Chesterman.  We didn't actually call on you in relation to the costs of today, Mr Robinson.  Did you actually want to agitate that or not?

MR ROBINSON:  Just briefly, if I may, your Honours.

...

THE CHIEF JUSTICE:  We have heard and considered your submission, Mr Robinson, but the order will remain as it is.

MR ROBINSON:  Thank you, your Honours.

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