Hambleton v State Trustees Ltd
[2016] VSC 215
•16 May 2016
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
S CI 2014 00786
| MARY JOSEPHINE HAMBLETON | Plaintiff |
| v | |
| STATE TRUSTEES LTD (ACN 064 593 148) (who act as Administrator of the Estate of Bruce Francis Campbell, deceased) | Defendant |
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JUDGE: | Daly AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 3 March 2016 |
DATE OF RULING: | 16 May 2016 |
CASE MAY BE CITED AS: | Hambleton v State Trustees Ltd |
MEDIUM NEUTRAL CITATION: | [2016] VSC 215 |
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PRACTICE AND PROCEDURE – Application for leave to discontinue proceeding – Outstanding issue of costs – Supreme Court (General Civil Procedure) Rules 2015 r 63.15 – Breach of overarching obligations – Indemnity costs – Civil Procedure Act 2010 (Vic) s 16, 28 and 29 – Actrol Parts Pty Ltd v Coppi (No 3) [2015] VSC 758 applied.
COSTS – Offer of compromise made by defendant refused by plaintiff – Supreme Court (General Civil Procedure) Rules 2015 r 26.08 - Judgment on a claim in the proceeding enlivens the jurisdiction to make orders under r 26.08 – No special circumstances sufficient to displace order of indemnity costs – Davis v Robek Australia Pty Ltd [2014] VSC 360 and IFTC Broking Services Ltd v Commissioner of Taxation (2010) 268 ALR 1 applied – Exceptional case required to depart from prima facie position of indemnity costs – Port Kembla Coal Terminal Ltd v Braverus Maritime Inc (No 2) (2004) 212 ALR 281 applied– Murphy v Westpac Banking Corporation (No 2) [2015] FCA 266 considered – Consider circumstances operative at the time the relevant offer was open for acceptance – Conduct said to amount to special circumstances postdates expiry of time for acceptance of the offer and did not alter the landscape of the proceeding – Defendant entitled to costs on indemnity basis.
COSTS – Offer of compromise made by defendant refused by plaintiff – Unreasonable for plaintiff to fail to accept offer of compromise - Smith v Jovanoska (No 2) [2013] VSC 714 and Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) (2005) 13 VR 435 considered – Special circumstances sufficient to displace operation of r 26.08(4) as judgment obtained other than on the adjudication of the merits of the claim.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr M Hume | Vernon Da Gama & Associates |
| For the Defendant | Mr P Wallis | Maddocks |
HER HONOUR:
This proceeding concerns a dispute between the plaintiff, Ms Hambleton, and the defendant, State Trustees Ltd (‘State Trustees’), regarding the administration of Ms Hambleton’s late father’s estate (‘estate’). The dispute arose out of the terms of the settlement of an earlier proceeding, where State Trustees, the executor of the estate, sought to recover from Ms Hambleton’s husband an amount said to represent a half share of a property which was said by State Trustees to form part of the estate (‘County Court proceeding’). The terms of settlement provided that Ms Hambleton would forego her entitlement to a one‑fifth share of the (modest) estate. If Ms Hambleton ever agreed to these terms, which is not necessary to determine for the purposes of this application, in the months following the parties’ entry into the terms of settlement she vigorously protested against the State Trustees’ refusal to distribute to her a one‑fifth share of the estate.
The procedural history of this proceeding is summarised in my first (unpublished) ruling in this proceeding, which was delivered on 31 August 2015, and reproduced in part below:
(a)the proceeding was issued on 21 February 2014, in which the plaintiff sought orders compelling State Trustees to make a distribution to her as a co-beneficiary of her deceased father’s estate. The proceeding was defended by State Trustees on the basis that the plaintiff had waived her right to a share of the estate during the course of a settlement reached between State Trustees and the plaintiff’s husband in December 2013;
(b)on 17 February 2015 I made orders setting the matter down for trial on an estimate of three days commencing on 2 September 2015. I also ordered that the proceeding be referred to mediation by an associate judge. The mediation was unsuccessful;
(c)on 15 July 2015 State Trustees sent the plaintiff a letter enclosing a cheque in her favour of the amount of $14,388.31, along with a statement of account showing that the plaintiff had participated equally in the distribution of the estate; and
(d)on 11 August 2015 the solicitors for State Trustees wrote to the Court expressing concern that there were a number of issues which might affect the ability of the matter to proceed to trial, including but not limited to the fact that the estate had been distributed, and
‘without the provision of further and better particulars of the plaintiff’s loss, it is unclear to the defendant what damages are sought by the plaintiff at trial’.
Between 18 August 2015 and 31 August 2015 there were a number of hearings, whereby the trial date was vacated, Ms Hambleton was provided with an opportunity to file an amended statement of claim, and a summary judgment application brought by State Trustees was heard and determined.
The background to and outcome of the summary judgment application are summarised in my second ruling, delivered on 13 November 2015, which is reproduced in part below:
In the amended statement of claim filed on 21 August 2015, Ms Hambleton maintained her claim for certain declarations, notwithstanding the payment to her of her share of her late father’s estate (‘estate’), and claimed interest upon that share for an unspecified period of time and at an unspecified rate. She also claimed that:
Punitive damages ought to be awarded against State Trustees for either intentional or reckless or contumelious conduct as part of their breaches of duty. Punitive damages ought to be awarded either for individual breaches of duty or based upon the conduct of State Trustees in its entirety.
In addition to the breaches alleged in her original statement of claim which were said to give rise to a claim for punitive damages, Ms Hambleton also sought to rely upon the following conduct of State Trustees:
(a)a failure to co-operate to reduce costs in relation to interlocutory proceedings as occasioned by the premature listing of an interlocutory hearing on 26 August 2015;
(b)the making of unpleaded allegations of fraud or other serious misconduct during an interlocutory hearing on 26 August 2015;
(c)any other contumelious conduct committed by the respondent from the date of the filing of these pleadings.
Prior to the filing and service of the amended statement of claim on 21 August 2015, Ms Hambleton had made no claim for punitive damages against State Trustees, notwithstanding the fact that the proceeding had been on foot since 21 February 2014, and, apart from the three matters pleaded above, the conduct relied upon to support a claim for punitive damages was the conduct of State Trustees relied upon for her claim to be paid her share of the estate (‘primary claim’). In the circumstances (whereby State Trustees had, in effect and for whatever reason, conceded the primary claim), it is possible for me to draw the inference that Ms Hambleton had made the claim for punitive damages in order to keep the proceeding alive, given that the only outstanding issues in the proceeding prior to that time were interest (which must necessarily be of a small quantum) and the costs of the proceeding.
In the reasons, I found that State Trustees was entitled to judgment on Ms Hambleton’s claim insofar as she claimed her legal costs of the proceeding as a head of damage.[1] Further, I found there was no utility in the declaration sought by Ms Hambleton in relation to State Trustees’ failure to distribute to her share of the estate …
I also found that the claims for interest and punitive damages were inadequately pleaded, but noted that of necessity, the amendments had been pleaded in some haste, and gave Ms Hambleton liberty to apply to file and serve a further amended statement of claim if she wished to press her claims in that regard, provided that any draft pleading be accompanied by a ‘Proper Basis’ certificate signed by the solicitor for Ms Hambleton.
[1]See Gray v Sirtext Medical Ltd (2011) 276 ALR 267, 273–274.
The ruling of 13 November 2015 concerned a proposed further amended statement of claim filed and served by Ms Hambleton on 28 September 2015. The issue before me at the hearing on 14 October 2015 was whether leave ought to be granted to file and serve this document, which was, despite traversing the factual matters in the proceeding as originally issued, an entirely new document. The proposed further amended statement of claim alleged:
(a) that State Trustees owed Ms Hambleton a duty of care, including a duty to comply with the terms of the will;
(b)it was reasonably foreseeable that any breach of duty would cause Ms Hambleton loss;
(c)by reason of certain conduct of State Trustees, State Trustees failed to exercise due care and skill;
(d)by reason of State Trustees’ negligence, Ms Hambleton suffered loss, namely:
(i)one fifth of the share of the dissipation of funds in the estate as calculated from the date of the receipt of Ms Hambleton’s monies into State Trustees’ accounts, and 16 July 2015; and
(ii)lost interest, calculated from the date of receipt of Ms Hambleton’s monies into State Trustees’ accounts to 16 July 2015, to be calculated pursuant to section 2 of the Penalty Interest Rates Act1983 (Vic).
The proposed further amended statement of claim included a claim for aggravated damages and punitive (or exemplary damages). These claims were summarised in the 13 November 2015 ruling as follows:
At paragraph 47 of the statement of claim, Ms Hambleton alleges that by reason of:
(a)counsel’s statement during the course of submissions on 26 August 2015;
(b)counsel’s statement during the course of submissions on 29 August 2015;
(c)the contents of a letter sent by an internal solicitor of State Trustees to Ms Hambleton’s solicitors dated 13 February 2014; and
(d)State Trustees’ failure to withdraw the allegations in the submissions and the letter;
State Trustees has acted in a contumelious way during or after its actions giving rise to the primary claim. That conduct was said to be contumelious because:
(a) it added insult to injury;
(b)it acted in circumstances where State Trustees was required to conduct itself as a model litigant;
(c)it had a duty not to breach Ms Hambleton’s human rights under s 13(b) of the Charter of Human Rights and Responsibilities to ‘not have his or her reputation unlawfully attacked’;
(d)State Trustees was in a fiduciary relationship with Ms Hambleton;
(e)State Trustees had knowledge of the special psychological vulnerability that Ms Hambleton had to any allegations of fraud or serious misconduct in this matter; and
(f)as a result of State Trustees’ conduct Ms Hambleton suffered hurt and affront.
In the 13 November 2015 ruling, I rejected Ms Hambleton’s application for leave to file and serve the proposed further amended statement of claim, on the basis that:
On the current state of the authorities, State Trustees owed no common law duty of care to Ms Hambleton, and as such, has no entitlement to damages at common law, including aggravated and/or exemplary damages.
I also found that, even if Ms Hambleton’s claims were tenable at law, ‘the conduct relied upon by Ms Hambleton to found her claim for exemplary and/or aggravated damages simply cannot give rise to an award of that nature’. Accordingly, I refused leave, and made the following observations:
Accordingly, I will refuse Ms Hambleton leave to file and serve the proposed further amended statement of claim. On the basis of these findings, I see no point in providing Ms Hambleton a further opportunity to replead. The proceeding has been on foot for nearly two years. Ms Hambleton has been given two opportunities to plead her claim for aggravated and/or exemplary damages, and the allegations finally relied upon are unmaintainable. To provide her with a further opportunity will unnecessarily and unfairly vex State Trustees and further consume court resources. In this I have regard to the statements of Kyrou J (as he then was) in Kuek v Devflan Pty Ltd[2] when discussing the applications of the principles of the Civil Procedure Act 2010 (Vic) …
I shall relist the matter for hearing on the question of the costs of the hearing to date, and for submissions as to why the proceeding, insofar as Ms Hambleton seeks to pursue a claim for interest and in respect of the dissipation of the assets of the estate, should not be transferred to the Magistrates’ Court.
[2][2012] VSC 571 [77]–[79].
Notwithstanding the above, the proceeding returned to Court on 7 December 2015, when I made the following orders:
1.The Plaintiff’s application for leave to file and serve the proposed further amended statement of claim dated 28 September 2015 is refused.
2.On or before 4.00pm on 21 December 2015, the Plaintiff:
a)file and serve a statement of case, setting out the amount sought by her in respect of her outstanding claims for interest and dissipation of the estate of Bruce Francis Campbell, together with the asserted legal basis for those claims;
b)file and serve any affidavits upon which she intends to rely at trial in support of the above claims; and
c)serve any affidavits upon which she intends to rely on the question of costs.
3.On or before 4.00pm on 29 January 2016, the Defendant:
a)file and serve a statement in response to the statement of case referred to above;
b)file and serve any affidavits upon which it intends to rely at trial in opposition to the above claims; and
c)serve any affidavits upon which it intends to rely on the question of costs.
4.The proceeding be set down for trial for the hearing of the above claims and the question of costs on 22 February 2016 on an estimate of half a day.
5.Costs be reserved.
The hearing date of 22 February 2016 was subsequently vacated, and the matter relisted for hearing on 3 March 2016. On 25 February 2016, the solicitors for Ms Hambleton wrote to the solicitors for State Trustees and the Court in the following terms:
We refer to the above matter and to the Orders dated 18 February 2016.
We are instructed not to proceed on the substantive question of breach of duty but will seek to have the matter proceed on the question of costs only.
Our client will accordingly seek leave to file and serve a further affidavit on the question of costs of the cause and all reserved costs by Monday 29 February 2016.
Accordingly, the hearing on 3 March 2016 proceeded on the question of costs alone. Ms Hambleton applied for leave to discontinue the proceeding, and to be relieved of the usual costs consequences under rule 63.15, whereby:
unless the Court otherwise orders, a party who discontinues or withdraws part of a proceeding, counterclaim or claim by third party notice shall pay the costs of the party to whom the discontinuance or withdrawal relates at the time of the discontinuance or withdrawal.
Rather, Ms Hambleton seeks orders that State Trustees pay Ms Hambleton’s costs on an indemnity basis up to 5 December 2014, and on a standard basis thereafter, save for the costs thrown away by reason of the application for leave to file the proposed further amended statement of claim dated 28 September 2015 (that is, the application that was the subject of my ruling on 13 November 2015). Counsel for Ms Hambleton concedes that she ought to be liable for State Trustees’ costs of and incidental to that application.
As for State Trustees, it submits that it ought to be paid its costs from the commencement of the proceeding on a standard basis, and on an indemnity basis from 29 July 2014. It relies upon an offer of compromise served on 25 July 2014, whereby it offered to pay Ms Hambleton the sum of $15,000 plus costs (‘first offer of compromise’). Alternatively, it relies upon an offer of compromise served on 4 December 2014, whereby it offered to pay Ms Hambleton the sum of $20,000 plus costs (‘second offer of compromise’). At the time of the service of the first offer of compromise, a one‑fifth share of the estate amounted to $13,658.99. If an allowance had been made for penalty interest (netting off the actual interest which had accumulated by reason of the investment of the funds of the estate), the claim amounted to $14,311.
At the time of the second offer of compromise, a one-fifth share of the estate amounted to $14,054.42. If an allowance had been made for penalty interest, the claim amounted to $15,259.25.
Further, State Trustees contended that the proceeding ought to be dismissed, rather than being the subject of leave to discontinue, so as to leave no doubt as to the operation of order 26 of the Rules. However, it is apparent from the submissions of counsel for Ms Hambleton that it is conceded that the second offer of compromise was a reasonable offer, and that Ms Hambleton must identify special circumstances in order to negate the ordinary operation of order 26. (Curiously, the submissions did not address the first offer of compromise). However, counsel submitted there were special circumstances which justified the orders sought by Ms Hambleton.
Rules 26.08(3) and (4) relevantly provide as follows:
(3)Where an offer of compromise is made by a defendant and not accepted by the plaintiff, and the plaintiff obtained a judgment on the claim to which the offer relates not more favourable to the plaintiff than the terms of the offer, then, unless the Court otherwise orders –
(a)the plaintiff shall be entitled to an order against the defendant for the plaintiff’s costs in respect of the claim before 11.00a.m. on the second business day after the offer was served, taxed on the ordinarily applicable basis; and
(b)the defendant shall be entitled to an order against the plaintiff for the defendant’s costs in respect of the claim thereafter taxed on the ordinarily applicable basis.
(4)Where an offer of compromise is made by a defendant and the plaintiff unreasonably fails to accept the offer and the claim to which the offer relates is dismissed or judgment on the claim is entered in favour of the defendant, then unless the Court otherwise orders …
(a)the defendant shall be entitled to an order against the plaintiff for the defendant’s costs in respect of the claim until 11.00am on the second business day after the offer was made, taxed on the ordinarily applicable basis; and
(b)the defendant shall be entitled to an order against the plaintiff in respect of the defendant’s costs after the time referred to in paragraph (a) taxed on an indemnity basis.
In my view, the provisions of order 26 were engaged by reason of the judgment given in favour of State Trustees on 31 August 2015, for the following reasons:
(a) the language of rr 26.08(3) and (4) refer to ‘a claim to which the offer relates’, not a ‘proceeding to which the offer relates’. Therefore, it is possible that order 26 may be engaged when there is a judgment on a claim in a proceeding, while other claims made in the proceeding remain on foot;
(b) accordingly, insofar as Ms Hambleton claimed that she was entitled to a one‑fifth share of the estate, judgment was entered in favour of State Trustees on that claim on 31 August 2015, and the burden of persuading me that I should not make the orders sought by State Trustees, at least in respect of costs incurred up to and including 31 August 2015, rests with Ms Hambleton, and, consistently with the authorities, requires that she show special circumstances that relieves her of the consequences of failing to accept the first offer of compromise; and
(c) insofar as Ms Hambleton’s claims were not the subject of judgment in favour of the defendant, and remained on foot, it is those claims which are the subject of the application for leave to discontinue. Again, the burden of persuading me why the costs incurred after 31 August 2015 should not be ordered to be paid in accordance with rule 63.15 lies with Ms Hambleton (noting that she has already conceded liability for the costs incurred by State Trustees with respect to the costs of the application for leave to amend). However, the onus of persuading me that any costs payable to State Trustees referable to the period after 31 August 2015 be payable on an indemnity basis lies with State Trustees, to be determined on the basis of the usual principles applicable to such applications.
In Davis v Robek Australia Pty Ltd (‘Davis’),[3] I adopted the following statement of principle as being applicable to the exercise of my discretion to ‘otherwise order’ under order 26. In IFTC Broking Services Ltd v Commissioner of Taxation,[4] the Full Federal Court stated as follows:
Futuretronics exposes the difference between a Calderbank offer and an offer of compromise. In respect of a Calderbank offer, characterisation of the refusal to accept the offer as reasonable or not is significant, even potentially determinative. In respect of an offer of compromise, the reasonableness of the refusal to accept the offer is not, of itself, sufficient to displace the consequence of indemnity costs. The appellants’ reliance on various circumstances said to make their refusal of the offer reasonable fails to confront this difference of principle.
[3][2014] VSC 360.
[4](2010) 268 ALR 1 [12].
In applications determined after my ruling in Davis,[5] the authorities confirm and adopt the approach of the Full Federal Court extracted above, and have expressly endorsed the statement by Hely J in Port Kembla Coal Terminal Ltd v Braverus Maritime Inc (No 2),[6] to the effect that the prima facie position should only be departed from for proper reasons, which generally only arise in an exceptional case. In Merost Pty Ltd v CPT Custodian Pty Ltd (No 2),[7] North J extended the application of the principle to cases where the applicant had at trial bettered the respondent’s offer. In Murphy v Westpac Banking Corporation (No 2),[8] Griffiths J rejected a submission that the expression ‘exceptional case’ should be understood as requiring the case needs in some way to be exceptional and that there is no requirement for ‘exceptional circumstances’ of any type in the sense of being extraordinary, rare, unprecedented, or unextended, noting that at least two Full Courts have expressly adopted Hely J’s statement.[9] Griffiths J went on to say:
Moreover, the relevant applicants’ reliance on unforeseen developments in the course of litigation needs to be approached with considerable caution in assessing whether the presumption is rebutted having regard to the policy and rationale underlying a provision such as rule 25.14, which is to oblige the parties to give serious thought to the risk involved in non‑acceptance on the basis that ‘litigation is inescapably chancy’ (see the observations of the Full Court in IFTC at [9(4)]).
The following observations of the Full Court (Kenny, Besanko and Perram JJ) in Oracle at [11]-[12], while directed to a similar presumptive position under rule 11(6), are also apposite:
It will be appropriate to depart from the presumptive position under rule 11(6) (and hence rule 11(4)) for proper reasons ‘which, in general, only arise in an exceptional case’: Port Kembla Coal Terminal Ltd v Braverus Maritime Inc (No 2) [2004] FCA 1437; (2004) 212 ALR 281 at 284 [17]. In assessing what is exceptional in the relevant sense it is useful to keep in mind, as the New South Wales Court of Appeal put in Maitland Hospital v Fisher (No 2) (1992) 27 NSWLR 721 at 725, that ‘[l]itigation is inescapably chancy’ and that it was precisely to encourage meditation upon that unsettling truth that court rules such as Order 23 providing for offers of compromise were introduced. In the words of Mason P, rules such as rules 11(4) and 11(6) encourage the parties ‘to give serious thought to the risk involved in non-acceptance’: Morgan v Johnson (1998) 44 NSWLR 578 at 581-2.
Thus the mere fact that something unexpected or unforeseen has happened during the course of the litigation is unlikely, in a usual case, to provide the kind of proper reasons for which Order 23 rules 11(4) and 11(6) call. The litigation landscape is littered with the wreckage of unforeseeable events and unexpected circumstances.[10]
[5][2014] VSC 360.
[6](2004) 212 ALR 281 [17].
[7][2014) FCA 594.
[8][2015] FCA 266.
[9]Futuretronics.com.au Pty Ltd v Graphix Labels Pty Ltd [2009] FCAFC 40; Richardson v Oracle Corp Australia Pty Ltd (No 2) [2014] FCAFC 139.
[10] Murphy v Westpac Banking Corporation (No 2) [2015] FCA 266 [31]–[32].
These observations are relevant in that they tend to focus the analysis upon the circumstances operative at the time the relevant offer was open for acceptance, rather than events which took place after that time, although that is not to say that later developments cannot be relevant to the determination of whether there are exceptional circumstances. However, I consider that it would be rare, indeed extraordinary for events which took place after judgment was entered to be a relevant consideration in determining where the liability lies for costs incurred prior to the entry of judgment.
Arguably, State Trustees ought to be able to rely upon rule 26.08(4), on the basis that I entered judgment in its favour on 31 August 2015 in respect of Ms Hambleton’s claims in respect of her entitlement to a one‑fifth share of the estate. However, judgment was given on that claim on the basis that the payment by State Trustees of the one‑fifth share rendered Ms Hambleton’s claim for a declaration to be futile, rather than on the basis of the merits of the claim. All that remained after the unsuccessful attempts to launch a claim for aggravated and/or punitive damages, was a claim for interest (which would have been capable of quantification, but was ultimately not quantified) and an unparticularised claim in relation to the alleged dissipation of the estate.
It is not entirely clear whether State Trustees relies upon rule 26.03(3) or rule 26.08(4), although, by reason of the nature of the orders sought by it, I presume it relies upon rule 26.08(4). The applicable tests are different. Either rule could apply to the current case, at least insofar as they relate to Ms Hambleton’s claim for a one‑fifth share of the estate. In order to displace State Trustees’ entitlement to costs on an indemnity basis after 29 July 2014, Ms Hambleton must show exceptional circumstances warrants departing from the prima facie position. However, in order for State Trustees to be able to recover the costs incurred by it prior to 29 July 2014, it must also establish that Ms Hambleton’s failure to accept the offer was unreasonable. In Smith v Jovanoska (No 2),[11] Zammit AsJ (as she then was) considered that the principles set out by the Court of Appeal in Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2),[12] which is concerned with the applicable principles for determining when a court’s jurisdiction to order indemnity costs are enlivened as a result of a party’s rejection of a Calderbank offer, are equally applicable to the question of determining whether a party’s rejection of an offer of compromise is unreasonable. I agree.
[11][2013] VSC 714 [13].
[12](2005) 13 VR 435.
Accordingly, what is required is a three stage process. First, were there exceptional circumstances which warranted a departure from the usual rule with respect to the costs of the parties between 29 July 2014 and 31 August 2015? If not, should Ms Hambleton also be required to pay the costs incurred by State Trustees prior to 29 July 2014, on the basis that it was unreasonable for Ms Hambleton not to accept the first offer of compromise, and judgment upon her claim to a one‑fifth share of the estate was entered in favour of State Trustees on 31 August 2015? Finally, how is the Court to deal with the costs of the parties incurred after 31 August 2015?
Counsel for Ms Hambleton submitted that there were special circumstances which warranted relieving Ms Hambleton of the usual consequences of failing to accept the second offer of compromise. These special circumstances were, in summary, as follows:
(a) Ms Hambleton was ultimately successful in the proceeding, in that she was paid her one-fifth share of the estate. The strength of her claim was in effect conceded by State Trustees in making the offers of compromise;
(b) State Trustees joined and removed a third party (I take this to be a submission that State Trustees caused the proceeding to be unnecessarily complicated and protracted);
(c) there was a late disclosure of documents by State Trustees (being the trust account statements for the estate exhibited to the affidavit of Hannah Burton sworn on 28 January 2016);
(d) State Trustees had made improper allegations of serious misconduct and collusion, which meant that Ms Hambleton was entitled to continue to prosecute the proceeding, notwithstanding the offers of compromise and the ultimate payment to her of her one‑fifth share of the estate; and
(e) State Trustees has acted in a high handed manner during the course of the litigation, which was inappropriate given that State Trustees was appointed by this Court as a trustee, and exercises and performs public duties.
Taking the last submission first, the conduct complained of included the late disclosure of documents, and a late change in the defence. However, conduct which was said to be particularly high handed was the sending of a letter shortly after the proceeding commenced threatening to pursue Ms Hambleton’s solicitors for costs if the proceeding continued, the sending of a letter shortly prior to trial stating that State Trustees would be inviting the Court to draw a Jones v Dunkel inference if Ms Hambleton did not call her solicitor and/or her husband to give evidence, and the sending of letters to the effect that Ms Hambleton’s solicitor had a conflict of interest in continuing to represent her, because he would be required to give evidence at the trial. Counsel for Ms Hambleton also criticised the conduct of the solicitors for State Trustees in issuing a subpoena directed at the solicitors who acted for Mr Hambleton in the County Court proceeding, and then seeking to inspect those documents, as it must have been apparent that those documents would include documents subject to a claim for legal professional privilege.
This conduct was also relied upon to support the contention that Ms Hambleton, her solicitors, and her then counsel at all times reasonably believed that State Trustees was defending the proceeding on the basis that Ms Hambleton had colluded with her husband in relation to the settlement of the proceeding between State Trustees and Mr Hambleton. She wanted to meet the challenge to the honesty of herself and her husband, and she wanted to go to trial on that point. The concerns of Ms Hambleton and her legal team that State Trustees would be pursuing allegations of serious misconduct and even criminality were reinforced by the remarks made by counsel for State Trustees during the course of the hearings on 26 August 2015 and 28 August 2015. At the hearing on 26 August 2015, counsel is said to have made remarks to the effect that the maintenance by Ms Hambleton of a claim to a share of the estate notwithstanding the terms of settlement between Mr Hambleton and State Trustees, in the County Court proceeding ‘smells like a set up’.
The transcript of the hearing shows what was in fact said, and provides some context to counsel’s remarks:
On 9 December, to be fair to the defendant, it gets a letter from the plaintiff’s husband saying “Here’s a settlement offer and my wife has agreed to forego her share” and all it hears back is “We’re seeking instructions” and the defendant says “Yes, you can seek instructions but we’re accepting the offer” then six weeks later – “Oh no, we didn’t give that permission”. On any view we can’t be in too much trouble on that 9th. You’ve got to scroll forward and see perhaps what the position is later.
Just outlining those facts, Your Honour, makes it really hard to see a punitive damages case. Surely the State Trustee, who is trying to balance the interests of all the other people plus not spend taxpayers’ money, is entitled to be a little bit sceptical about the wife suddenly bobbing up six weeks down the track and saying “Oh, I didn’t agree to that deal, give me back my $14,000”. I mean it all just smacks of a setup.
At the hearing on 28 August 2015, counsel for State Trustees closed his submissions with respect to State Trustees’ summary judgment application as follows:
As to the repeated references to what was said on Wednesday, as I understand it has always been clear that the defendant has denied the plaintiff’s claim on the pleading and that there is a real issue as to just exactly what the plaintiff knew on 9 December and shortly thereafter and what the position was as between her and her husband and I am going to be open and say that if this trial starts on Wednesday I’ll be asking a lot of questions about that and I don’t think there is any defamatory – any problem with defamation by me pursuing that line of enquiry in a case that is all about what was known and when.
If the plaintiff does not like what was said on Wednesday, she is really not going to like the cross‑examination next Wednesday. This repeated assertion that somehow this can found a case for punitive damages against the defendant because it wants to test the plaintiff’s case, in my submission, just can’t be right.
The remaining submissions advanced on behalf of Ms Hambleton are more relevant to the determination of the question of costs incurred after 31 August 2015.
In my view, the matters referred to above do not amount to special circumstances which warrant a departure from the rules with respect to the costs incurred by State Trustees between 29 July 2014 and 31 August 2015. Taking first the nature of the allegations made by State Trustees against Ms Hambleton and, by implication, her husband, it is clear from the pleadings and the open correspondence between the parties that State Trustees was extremely dubious about the merits and bona fides of Ms Hambleton’s claims. Ms Hambleton’s knowledge of the terms of the settlement between Mr Hambleton and State Trustees was, quite understandably, always openly an issue in dispute. Distasteful as it may be to some, particularly those on the receiving end of such allegations, there is nothing about the current case which takes it outside the usual ambit of civil litigation, and certainly not outside the ambit of the rules governing the costs consequences of failing to better an offer of compromise.
As for the remaining conduct of State Trustees complained of by Ms Hambleton, I note that only one event complained of by Ms Hambleton took place prior to the date for acceptance of the first offer of compromise, being the letter from State Trustees’ in‑house solicitor to Mr Da Gama (Ms Hambleton’s solicitor) of 13 February 2014 threatening to seek costs against Mr Da Gama personally. That letter may have been intemperate, but of itself does not amount to exceptional circumstances, and Mr Da Gama’s immediate protest in response appears to have put an end to the matter. As noted above, I have some doubts as to whether conduct which post‑dates the expiry of the time for acceptance of an offer of compromise is relevant, save for circumstances where a party substantially changes its claim or defence after the making of the offer and the date of judgment, such that there has been a substantial change in the landscape of the litigation. But that is not the case here. State Trustees filed its further amended defence on 30 April 2014, its third party notice addressed to Mr Hambleton’s former solicitors on 15 April 2014, and the only pleading which post-dated the time for acceptance of the first offer of compromise was State Trustees’ reply to the defence of the third party notice. State Trustees discontinued its third party proceeding on 19 January 2015, but it was not submitted, and I cannot see how that amounted to a significant shift in the landscape of the proceeding. I do not accept that the document filed by State Trustees in response to Ms Hambleton’s statement of case filed on 21 December 2015 amounted to a material change in State Trustees’ position. In any event, that document post-dated the judgment of 31 August 2015.
The other conduct complained of by Ms Hambleton, being the letters to her solicitors regarding the consequences of failing to call witnesses, the potential conflict between Ms Hambleton and her solicitors, and the issue of the subpoena to Fitzpatrick Legal, not only post-date the offers of compromise, they post-date the payment to Ms Hambleton of a one‑fifth share of the estate, which resulted in judgment being granted in favour of State Trustees on that part of the claim. However, in any event, even if they are relevant matters, it is difficult to see how the conduct of State Trustees’ solicitors in sending the letters and issuing a subpoena could, in effect, amount to disentitling conduct. To the contrary, it is good litigation practice for solicitors to warn their counterparts of the position that might be adopted at trial, in part to avoid taking the other party by surprise at trial. As for the subpoena to Fitzpatrick Legal, there is no authority to suggest, or any reason in principle to find that it is inappropriate to issue a subpoena to produce documents just because some of the documents produced may be subject to a claim for legal professional privilege by a party or a non‑party. The Rules provide an established procedure for objections to production and inspection on such grounds: the responsibility for that process not being activated cannot be sheeted home to State Trustees.
As for the remarks made by counsel at the hearings on 26 August 2015 and 28 August 2015, while they were perhaps intemperate, I cannot see how they are relevant disentitling conduct on the part of State Trustees, given they were made more than a year after the first offer of compromise was served. As counsel observed during the course of the hearing on 28 August 2015, Ms Hambleton’s knowledge of the terms of settlement was always an issue in the proceeding. State Trustees’ allegations might be relevant to the question of costs if it was contended that the allegations were entirely unfounded or incapable of properly being made by a responsible party or solicitor, but that is not put against State Trustees. No attempt was ever made to strike out State Trustees’ defence on that basis. While Ms Hambleton’s knowledge of the terms of settlement was not expressly pleaded in the amended defence, the amended defence clearly put Ms Hambleton’s state of mind in issue, as shown below:
10W.By reason of that matters pleaded in paragraphs 10A to 10T hereof, at all relevant times Mary represented, and continued to represent, that she was waiving any entitlement that she, as one of five equal beneficiaries of her Father’s Estate, had to share in the settlement moneys [‘representations’).
10X.Mary intended that STL would be induced by and act in reliance on her representations.
10Y.Induced by and acting in reliance of Mary’s representations, STL compromised the other proceeding on the condition that Mary was not to participate in the distribution of the settlement moneys.
10Z.In the premises, Mary is estopped:
(a)from asserting that she is entitled to share in the settlement moneys;
(b)from denying that she is not so entitled.
In order to make good its allegations in its further amended defence, State Trustees would not necessarily have to establish that Ms Hambleton colluded with her husband to deceive State Trustees and the various lawyers. All State Trustees needed to establish was whether Ms Hambleton had made certain representations to State Trustees. Further, the contention that State Trustees must have had such a case theory in mind because it intended to lead evidence of what occurred at the mediation of the County Court proceeding, and would have only been able to lead such evidence if it could establish criminality on the part of Ms Hambleton, lacks merit. Section 131(1) of the Evidence Act 2008 (Vic) (‘the Act’) would, in most cases, prevent the adducing of such evidence at trial. However, even if State Trustees intended to adduce such evidence (and it is not entirely clear to me whether it did intend to do so), it may well be able to rely upon a number of the exceptions set out in s 131(2) of the Act. Certainly, s 131(2)(j) applies to communication in furtherance of a fraud or an offence, but the exceptions in ss 131(2)(e), (f) or (g), which do not rely upon allegations of fraud, may also well apply. No allegation of ‘collusion’ or ‘criminality’ was made in the pleading. Ms Hambleton might understandably be concerned that if State Trustees made good its defence, the result might not reflect well upon her integrity, but again, that is one of the hazards of litigation. Defending a claim is not of itself disentitling conduct.
Accordingly, by reason of Mr Hambleton’s failure to accept the first offer of compromise, State Trustees is entitled to its costs of the proceeding between 29 July 2014 and 31 August 2015 on an indemnity basis.
The question of State Trustees’ costs prior to 29 July 2014, notwithstanding the terms of rule 26.08(4) and the judgment entered on 31 August 2015, is not quite so clear cut. If judgment had been entered after an adjudication of the merits of Ms Hambleton’s claims, I consider that State Trustees would be entitled to their costs prior to 29 July 2014. I accept that it was unreasonable for Ms Hambleton to fail to accept the offer of compromise. Ms Hambleton sought a number of declarations in her statement of claim, including declarations regarding State Trustees’ alleged breaches of duty, and sought orders that State Trustees be removed as the administrator of the estate. But her primary grievance, and her primary claim, was that she be entitled to a one‑fifth share of the estate. While there is no evidence that accounts were provided to her prior to service of the first offer of compromise, the particulars to paragraph 19 of the further amended defence specified with some particularity the movement of funds in and out of the estate between May 2012 and April 2014. The particulars also stated that ‘[a] copy of a Statement of Account for the period 21 May 2012 to 1 April 2014 will be provided on request’. The evidence is unclear as to whether a statement of account was provided prior to 28 January 2016, but it is also unclear as to whether it was ever pressed. I note that it was the subject of a Notice to Produce, but there is no evidence as to whether that was called upon. Accordingly, Ms Hambleton and her solicitors were, at the time the first offer of compromise was made, well aware of the likely quantum of her claim.
However, given that judgment was obtained other than on the adjudication of the merits of the claim, in my view, that constitutes special circumstances sufficient to justify a departure from the normal operation of the rule. The question remains, how should I ‘otherwise order’. The current position is somewhat analogous to proceedings where a party seeks leave to discontinue a proceeding, or to withdraw a defence. Generally, where a proceeding is rendered futile by intervening events, and it is not possible, without extensive inquiry, to determine the merits of the respective parties’ positions in the litigation, the Court will usually facilitate the orderly finalisation of the proceedings by making no order as to costs.[13] However, arguably, this is a situation where State Trustees has, in effect, capitulated. That it might have been motivated to do so on the basis of commercial considerations rather than on the basis of a lack of confidence in the merits of its position in the litigation is largely irrelevant. The practical reality of the situation is that Ms Hambleton has successfully maintained her claim. It was unreasonable of her not to accept the first offer of compromise (or for that matter, the second offer of compromise), and she has been visited with the costs consequences of that. I am also mindful that, having regard to the other orders I will make with respect to the third tranche of costs, State Trustees will be in no materially worse position than if Ms Hambleton had accepted the first offer of compromise. Accordingly, I will order that State Trustees pay Ms Hambleton’s costs of the proceeding up to 29 July 2014. I see no reason for ordering those costs to be paid other than on a standard basis.
[13]See Soteriadis v Nillumbik Shire Council [2015] VSC 363 [12]; Ferny Sky Pty Ltd v Capital Finance Australia [2006] VSC 366 [25]; Jeruth Pty Ltd v Haybale Pty Ltd [2004] VSC 319 [4]–[5].
The third tranche of costs to be considered are the costs of the proceeding after 31 August 2015, noting that counsel for Ms Hambleton has already conceded that she ought pay the costs of the application heard on 14 October 2015 and determined on 13 November 2015. I expect that application would account for a substantial part of the costs in issue. The question remains as to what is to be done with the remainder, and whether Ms Hambleton ought to be ordered to pay part or all of the costs on an indemnity basis.
As noted above, the starting position in an application for leave to discontinue is that the plaintiff pay the defendant’s costs. While the authorities suggest that this position may be departed from reasonably regularly, particularly in cases where supervening events have rendered the proceeding futile, and it is not possible, without an extensive evaluation of the merits of the parties’ positions, which party was in a superior position in the litigation.[14]
[14]See the authorities referred to in footnote 13.
In the current case, I do not see any reason to depart from the usual position. In effect, Ms Hambleton, by failing to press her claim to interest, has capitulated on that claim, just as State Trustees did in respect of the claim to a one fifth share of the estate. Again, the fact that the capitulation was made for sound commercial reasons does not materially alter the position.
Further, while the proceeding had been rendered commercially futile, there were special circumstances which warrant an order that Ms Hambleton pay State Trustees’ costs, and those matters caused me to conclude that those costs ought to be payable on an indemnity basis. In effect, since 31 August 2015, Ms Hambleton and her legal team have been desperately casting around for some means to keep this proceeding on foot: first by bringing legally and factually untenable claims, and then by making unparticularised and ultimately unsustainable claims that State Trustees had dissipated the estate. A claim for interest remained, but the quantum of that claim was modest in the extreme, and, as rightly conceded by Ms Hambleton’s legal team, did not justify a two to three day trial in the Supreme Court.
Counsel for Ms Hambleton candidly admitted that Ms Hambleton was motivated to continue the proceedings for two reasons: first, she continued to hold the view that State Trustees alleged that she had engaged in serious misconduct and/or criminal conduct in colluding with her husband to defraud the estate, and she wanted to vindicate her position and protect her and her husband’s reputation; and secondly, she was investigating claims she could bring against State Trustees in order to better the terms of the second offer of compromise. In effect, she was ‘hoodwinked’ by State Trustees when it paid her the one‑fifth share of the estate and she realised that she may face adverse costs consequences as a result of her refusal to better the second offer of compromise.
Ms Hambleton may well have felt ambushed by State Trustees’ payment to her in July 2015, and she was clearly aggrieved by its conduct over the course of its management of the estate, the settlement of the County Court proceeding, and over the course of this proceeding. But neither of the two motivating forces outlined above amount to a legitimate justification for pursuing litigation when there is no meritorious claim to pursue. As noted above, the claims for aggravated and/or punitive damages were found to be untenable, and the claim in respect of the alleged dissipation of the estate lacked any discernible factual foundation (at least none was articulated before me).
Indeed, the conduct of the proceeding after the payment of the one‑fifth share of the estate in July 2015 runs close to being capable of being described as an abuse of process on the part of Ms Hambleton, unfortunately supported and facilitated by her legal team. That would certainly justify an award of indemnity costs in State Trustees’ favour. However, I don’t need to go that far. The obligations of parties, practitioners and the Court are clearly set out in the Civil Procedure Act 2010 (Vic) (‘CPA’), and the CPA provides additional statutory reinforcement to the principles which have traditionally governed the Court’s approach to costs.
Section 16 of the CPA provides as follows:
16Paramount duty
Each person to whom the overarching obligations apply has a paramount duty to the court to further the administration of justice in relation to any civil proceeding in which that person is involved, including, but not limited to—
(a)any interlocutory application or interlocutory proceeding;
(b)any appeal from an order or a judgment in a civil proceeding;
(c)any appropriate dispute resolution undertaken in relation to a civil proceeding.
Sections 28 and 29 of the CPA make it clear that the Court has the right to take into account any contravention of the overarching obligations when exercising its discretion with respect to costs. These sections provides relevantly, as follows:
28Court may take contravention of overarching obligations into account
(1)In exercising any power in relation to a civil proceeding, a court may take into account any contravention of the overarching obligations.
(2)Without limiting subsection (1), in exercising its discretion as to costs, a court may take into account any contravention of the overarching obligations.
29Court may make certain orders
(1)If a court is satisfied that, on the balance of probabilities, a person has contravened any overarching obligation, the court may make any order it considers appropriate in the interests of justice including, but not limited to—
(a)an order that the person pay some or all of the legal costs or other costs or expenses of any person arising from the contravention of the overarching obligation;
(b)an order that the legal costs or other costs or expenses of any person be payable immediately and be enforceable immediately;
…
The overarching obligations which are relevant to the current case include the following:
(a) the prohibition upon making a claim in the proceeding which does not have a proper legal or factual basis;
(b) the overarching obligation to only take steps to resolve or determine a dispute;
(c) the overarching obligation to cooperate in the conduct of a proceeding;
(d) the overarching obligation to use reasonable endeavours to resolve a dispute;
(e) the overarching obligation to narrow the issues in dispute;
(f) the overarching obligation to ensure that costs are reasonable and proportionate to the complexity or importance of the issues in dispute and the amount in dispute; and
(g) the overarching obligation to use reasonable endeavours to act promptly and minimise delay.
I shall not enumerate in detail the conduct of Ms Hambleton and her legal team since July 2015 referable to my findings that there has been a breach of any particular overarching obligation. However, the following matters are noteworthy:
(a) since State Trustees paid Ms Hambleton the one fifth share of the estate some ten months ago, there have been nine Court appearances (18, 26, 28 and 31 August 2015, 14 October 2015, 13 November 2015, 7 December 2015, 22 February 2016, and 3 March 2016). Some of these appearances were relatively brief, while others went for a number of hours. This is my third written ruling. The excessive consumption of Court resources is a relevant consideration in determining the question of costs;
(b) there is evidence that both parties have expended considerable costs in prosecuting and defending what was only ever realistically going to be a very modest claim. The evidence shows that between 25 July 2014 and 26 January 2016, State Trustees incurred legal costs of $158,797.07, and that as at 12 August 2015, Ms Hambleton had incurred legal costs of $55,255.95. Given the substantial amount of activity after that date, and the number of Court appearances, she may well have incurred legal costs in the order of tens of thousands of dollars since 12 August 2015;
(c) as discussed above, the motivations of Ms Hambleton in continuing to prosecute her claims against State Trustees were dubious at best. The role of the Court is to resolve genuine disputes, not to provide for a venue to air grievances and hold people and institutions to account; and
(d) the late provision of the statements of account by State Trustees does not of itself excuse Ms Hambleton’s conduct. There was no claim in relation to the alleged dissipation of the estate until 28 September 2015, and even then, no clear factual basis for the allegation was articulated. There is no evidence that these documents were being actively pursued. The suggestion that Ms Hambleton and her legal team believed these documents were not being provided because of the existence of an audit report critical of State Trustees’ record keeping practices lacked merit.
While I was not referred to this authority during the course of argument, I am also bolstered by a recent decision of Bell J in Actrol Parts Pty Ltd v Coppi (No 3),[15] where a plaintiff pursued a former employee for breach of contract, on a matter of principle, even though it could not prove it had suffered any more than nominal damages. Bell J ordered that the plaintiff pay the defendant’s costs of the entire proceeding on an indemnity basis. While of course this is a somewhat different type of proceeding, with a different subject matter, the remarks of Bell J reproduced (at some length) below, apply with some resonance to the current case, particularly once payment had been made to Ms Hambleton of a one-fifth share of the estate.
[15][2015] VSC 758 [108]-[110].
108The principles governing the making of orders as to costs on an indemnity basis were discussed by Sheppard J in Colgate-Palmolive Company v Cussons Pty Ltd. According to these principles, such an order should not be made unless there be ‘some special or unusual feature in the case to justify the Court in departing from the ordinary practice’. His Honour gave examples of such features, including ‘particular misconduct that causes loss of time to the Court’, continuing proceedings ‘in wilful disregard of known facts or clearly established law’ and unreasonably refusing offers of compromise. Similar principles were discussed by Harper J in Ugly Tribe Company Pty Ltd v Sikola.
…
111In the present case, I have found against Actrol an egregious contravention of its overarching obligation to ensure costs are reasonable and proportionate. The course of the proceeding that I have described (which Actrol effectively controlled) is deserving of strong sanction by the court. Although I take the proceeding to have been commenced and initially prosecuted appropriately, the conduct of the proceeding by Actrol after about mid-June 2015 was completely unacceptable. Actrol’s egregiously contravening conduct of the proceeding thereafter, especially in causing the trial to run to final judgment, has been such as to (dis)colour the whole character of the proceeding from start to finish.
…
113As revealed by this judgment, the course of this proceeding has been rather ordinary at a superficial level. Mr Coppi resigned his employment with Actrol and commenced new employment with a competitor. Fearing that Mr Coppi had abused his responsibility to keep company information confidential, Actrol obtained a search order from the court against him. Nothing much was discovered suggesting that Mr Coppi had passed confidential information on to third parties. The proceeding dragged on. When the parties failed to settle their differences, it went to trial with Actrol alleging breach of contract and certain duties of employment and Mr Coppi denying these allegations.
114However, the course of the proceeding has been quite extraordinary at a fundamental level. Suspecting that Actrol had suffered no compensable damage by reason of the alleged breaches of contract and duty, Mr Coppi’s solicitors constantly pressed Actrol’s solicitors to give particulars of its loss. Actrol did not do so. Over time it became clear that it had not suffered any or any significant compensable loss. It also became clear that the alleged breaches of contract and duty were relatively minor in nature. Actrol refused reasonable settlement offers and costs escalated on both sides. Actrol amended its statement of claim and went to trial with a claim for purely nominal damages on a point of modest principle, conceding that it had suffered no compensable loss by reason of the alleged breaches of contract and duty on the part of Mr Coppi. At the seven day trial on liability, each party was represented by senior and junior counsel instructed by solicitors.
115Actrol is a wholly owned subsidiary of a publicly listed company (Reece Australia Ltd). Mr Coppi is an individual – married with two children, earning about $100,000 per annum and funding his own legal fees. The family home is charged with those fees. There is great disparity of resources between the parties. On the information provided to the court, Actrol has expended in the vicinity of $600,000 in legal costs in conducting the proceeding. Mr Coppi has expended in excess of $300,000 in legal costs in defending the proceeding. Having regard to the complexity and importance of the issues in dispute, which are no more than moderate and minor respectively, and the amount in dispute, which is actually nominal, these amounts are totally unacceptable. For the reasons explained in this judgment, it is Actrol who must be held responsible, essentially because it has egregiously contravened its overarching obligation under s 24 of the Civil Procedure Act 2010 (Vic) to ensure costs are reasonable and proportionate. That is to be reflected in orders dismissing the proceeding and for indemnity costs in Mr Coppi’s favour.
116I accept that Actrol conducted the proceeding against Mr Coppi because it was thought necessary in the best interests of the company in managing apprehended risks to those interests. But the legal system is not an infinite resource for the management and mitigation of business risks of whatever nature and degree. Modern case management principles and the provisions of the Civil Procedure Act insist upon reasonable proportionality between the achievement of litigious objectives (having regard to the issues raised in the proceeding) and the legal costs that are expended in the pursuit of those objectives. There must be reasonable proportionality between those ends and those means.
117Having regard to the course of the proceeding, it is not surprising that senior counsel for Mr Coppi has called for judicial criticism of Actrol’s conduct and pointed to the implications of that conduct, if not sanctioned, for the conduct of civil litigation generally. I take this into account in making final orders (see below).
118I must draw the attention of all parties to civil litigation to their responsibilities under the case management principles of the court and the Civil Procedure Act. Let not the course of this proceeding ever be repeated unless the complexity and importance of the issues, and the amount, in dispute makes this reasonably necessary. Let it be understood that the court is prepared to exercise its enhanced and new powers in relation to civil proceedings in quite fundamental ways when this is called for, especially where the overarching obligation to ensure costs are reasonable and proportionate is contravened.
In my view, the responsibility for the protracted finalisation of the proceeding and the consequent cost and inconvenience to the parties can be largely sheeted home to Ms Hambleton and her legal team. State Trustees acted responsibly when it first raised the question of the utility of this proceeding with the Court in August 2015. It has been substantially successful in relation to each of the applications that have been made since then. Ms Hambleton has been granted a number of opportunities to bring forward a viable claim, which I now know was, at least in part, pursued for the purpose of attempting to avoid the cost consequences of her failing to accept two reasonable offers at a relatively early stage of the proceeding. In my view, the circumstances weigh in favour of Ms Hambleton being required to pay the costs incurred by State Trustees since 31 August 2015 on an indemnity basis.
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