Hebbel Constructions Pty Limited v Bitar Pty Limited - [2018] NSWSC 859

Supreme Court

New South Wales

Medium Neutral Citation: Hebbel Constructions Pty Limited v Bitar Pty Limited and Anor [2018] NSWSC 859
Hearing dates: 10 May 2018
Decision date: 08 June 2018
Jurisdiction: Equity
Before: Black J
Decision:
Bitar Pty Ltd to pay the Court-appointed receiver’s costs of and incidental to the motion on an indemnity basis. Bitar Pty Ltd to pay Hebbel Construction Pty Ltd’s costs of and incidental to the motion on the ordinary basis.

Catchwords: COSTS – indemnity costs – where unsuccessful application for discharge of Court-appointed receiver – whether applicant will be required to pay receiver’s costs on indemnity basis.
Cases Cited: - MLW Investments Pty Ltd v Tacsum Pty Ltd [2006] NSWSC 1256
Category: Costs
Parties: Hebbel Constructions Pty Limited (Plaintiff)
Bitar Pty Limited (First Defendant)
Hebbel Constructions Pty Ltd & Bitar Pty Ltd (Second Defendant)
Representation:
Counsel:
P Wiggins (Solicitor – Plaintiff)
P E King (First Defendant)
S Golledge (Court Receiver)
Solicitors:
Paramonte Legal (Plaintiff)
Priest Legal (First Defendant)
Yates Beaggi (Court Receiver)

File Number(s): 2014/296117 (012)

Judgment

By my judgment delivered on 25 May 2018 ([2018] NSWSC 758) (“Judgment”), I dismissed an application made by Bitar Pty Ltd (“Bitar”) for the discharge of a receiver appointed by the Court to the assets of a partnership of Hebbel Constructions Pty Ltd (“Hebbel”) and Bitar and the shares in Bitar Hebbel Constructions Pty Ltd, and also declined to order an interim distribution which Bitar sought to have made by the receiver to it. I reserved liberty to apply on 2 business days’ notice in respect of any issue arising from any significant delay in the completion of the sale of a particular residential unit to its occupant, or, if she did not promptly complete a purchase of that unit, to a third party. I expressed the preliminary view that Bitar should pay the receiver’s costs of and incidental to the application, on an indemnity basis, and should pay Hebbel’s costs of and incidental to the application on an ordinary basis, consistent with the orders as to costs made in MLW Investments Pty Ltd v Tacsum Pty Ltd [2006] NSWSC 1256, but indicated that I would allow the parties an opportunity to be heard.
On 25 May 2018, I directed that the parties submit agreed Short Minutes of Order to give effect to the Judgment, including as to costs, within 7 days, or if there was no agreement between them, their respective draft orders and submissions including as to costs. The receiver submitted Short Minutes of Order, which it had agreed with Hebbel, and Bitar submitted draft orders that differed in some respects, including as to costs, as to which the parties each made submissions.
Bitar referred to the history of the proceedings and accepted that it should pay the receiver’s costs of the application on the ordinary basis and submitted that there should otherwise be no order as to costs. Bitar submits that it was reasonable for it to bring the application:

“in…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2018] NSWSC 859
Decision Date: 08 June 2018

CaseChat Overview and Summary

Hebbel Constructions Pty Limited sought to discharge a court-appointed receiver over its assets. The application was dismissed, and Bitar Pty Limited, the successful party, applied for indemnity costs. The dispute reached the Supreme Court of New South Wales. The central legal issue was whether the unsuccessful party, Hebbel, would be required to pay the receiver's costs on an indemnity basis. The court examined whether the application for discharge was frivolous or vexatious, which would warrant such costs.

The court considered the nature of the application and the circumstances surrounding it. It found that the application was not frivolous or vexatious, given the basis on which it was made. As a result, the court determined that indemnity costs were not appropriate. Instead, the court assessed the costs on the standard basis. The judge emphasised the importance of considering the merits of the application and the conduct of the parties involved in reaching this decision.

Consequently, the court dismissed Bitar's application for indemnity costs and ordered that costs be assessed on the standard basis. This decision highlights the court's cautious approach to awarding indemnity costs, ensuring that such an award is reserved for the most egregious cases. The final orders reflect the court's finding that the application did not warrant indemnity costs, and the unsuccessful party would only be liable for the standard costs associated with the proceedings.

Orders