FEDERAL COURT OF AUSTRALIA
Herold v Seally (No 3) [2017] FCA 956
File number(s): NSD 2139 of 2016 Judge(s): BROMWICH J Date of judgment: 18 August 2017 Catchwords: COSTS – application for different costs order following hearing of competing interlocutory applications – where both interlocutory applications dismissed– whether apportionment of costs appropriate on the basis that issues determined were clearly “separable” – whether Calderbank principles applicable Cases cited: Bostick Australia Pty Ltd v Liddiard (No 2) [2009] NSWCA 304
Calderbank v Calderbank [1975] 3 All ER 333
Herold v Seally(No 2) [2017] FCA 543
Specsavers Pty Ltd v Luxottica Retail Australia Pty Ltd (No 2) [2013] FCA 807
Date of hearing: 16 June 2017 Registry: New South Wales Division: General Division National Practice Area: Intellectual Property Sub-area: Trade Marks Category: Catchwords Number of paragraphs: 20 Counsel for the Applicants: Mr M Hall SC Solicitor for the Applicants: James Beatty & Associates Counsel for the Respondents: Mr T Di Francesco Solicitor for the Respondents: Phillips Ormonde Fitzpatrick Lawyers ORDERS
NSD 2139 of 2016 BETWEEN: LARS HEROLD
First Applicant
GREEN LIGHT GROUP PTE LTD (SINGAPORE COMPANY REGISTRATION NO 20121505Z)
Second Applicant
AND: JONATHON SEALLY
First Respondent
PODWAY LTD
Second Respondent
JUDGE:
BROMWICH J
DATE OF ORDER:
18 AUGUST 2017
THE COURT ORDERS THAT:
1.The respondents’ application for a different costs order to that made on 19 May 2017 be dismissed.
2.Order 3 made on 19 May 2017 that each party bear their own costs be confirmed.
3.The respondents pay the applicants’ costs of and incidental to this application for costs as assessed or agreed.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
BROMWICH J:
This is a dispute about the costs order that should be made following my orders and reasons in Herold v Seally(No 2) [2017] FCA 543, by which I refused both the applicants’ bid by interlocutory application for an anti-suit injunction of proceedings in the Superior Court of California and the respondents’ bid by interlocutory application for complete or partial setting aside of these proceedings. As outlined in Herold v Seally(No 2), the parties to these proceedings are involved in a highly polarised dispute as to who should take the dominant credit for the development of a particular concept for driverless vehicles, and thereby be able to develop the concept commercially, principally overseas. Each unsuccessfully sought to have the dispute wholly or substantially litigated in only one jurisdiction.
On 19 May 2017, I ordered that the two interlocutory applications be dismissed with each party to bear their own costs, but granting liberty to apply for a different costs order within 14 days. The respondents availed themselves of that liberty by seeking alternate costs orders wholly or substantially in their favour.
Having considered carefully the competing submissions, agreement as to costs in the cause being unable to be reached, I am not satisfied that the costs order I made on 19 May 2017…
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- Herold v Seally (No 3) [2017] FCA 956
- Case
- [2017] FCA 956
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CaseChat Overview and Summary
The Court found that the late Calderbank offer was not a valid offer due to the limited time provided for consideration, and even if it were valid, it did not confine itself to the issues to be adjudicated by the Court. Therefore, it was impossible to determine whether the respondents had obtained a better outcome than what would have been achieved by their offer. The Court also found that the question of whether only one forum was appropriate was central to both interlocutory applications and could not be artificially separated as distinct issues.
In conclusion, the Court dismissed the respondents' application for a different costs order and confirmed the original costs order made on 19 May 2017, which required each party to bear their own costs. The respondents were also ordered to pay the applicants' costs of and incidental to the application for costs as assessed or agreed. The case demonstrates the importance of the timing and scope of Calderbank offers and the need to consider the issues in their proper context when determining costs orders.
Orders
Orders of the court
1. The respondents’ application for a different costs order to that made on 19 May 2017 be dismissed.
2. Order 3 made on 19 May 2017 that each party bear their own costs be confirmed.
3. The respondents pay the applicants’ costs of and incidental to this application for costs as assessed or agreed.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
Ratio Decidendi
Legal Principle Established
Senior counsel for the applicants asserted that the submissions for the respondents had failed to address whether the outcome ordered by the Court was substantially better for the offering party than the offer that was made. It was submitted that as to the matters that were being adjudicated by the Court, the offers were in identical terms, namely, that both applications would be dismissed. However, the offer attempted to add further terms to the “deal” as to matters that were not then falling for consideration by the Court. The only difference between the parties was as to those ancillary matters, particularly the discovery order and the question of what would happen with the overseas proceedings. The substance of the submission was that the offer made by the email was a conditional offer in respect of issues that were a sideline to the disputed matters to be the subject of adjudication. It was therefore submitted that in order to determine whether or not the respondents did better than the offer they had made, I would have to determine the issue of discovery. In making those submissions, senior counsel for the applicants also emphasised that the respondents’ offer left only a very short period of time on a rushed morning in which to seek to respond to what was being proposed, noting that the applicants asserted that they did their very best to respond to the offer and in a commercial way in order to resolve it before the hearing. It was submitted that an offer made “at the heel of the hunt” should have a much tougher task of persuading a court that a special costs order ought to be made in place of the costs order already made.Consideration The primary costs order sought by the respondents should not be granted for two interrelated reasons. First and foremost, the question of whether only one forum was or was not clearly inappropriate was at the heart of both of the interlocutory applications. It was a matter of efficient organisation of the consideration of the two sets of litigation that it was dealt with under the umbrella of the application for an anti-suit injunction, rather than under the umbrella of the respondents’ strike out application. It could just as well, if perhaps not as efficiently, have been dealt with under the umbrella of the strike out application, which then would have determined in large measure the anti-suit injunction application. The way in which a judgment is written to address and resolve particular issues in dispute should not artificially suggest that an issue is dominant or separable in the way contemplated by the restatement of principle in Bostick. Secondly, and in any event, the way in which the evidence and submissions were structured simply meant that it made sense to deal with the appropriate forum issue under the heading of the anti-suit injunction application. Again, the submissions could, perhaps less efficiently and less logically, have been written in a way that instead addressed the respondents’ strike out application as the means of considering the issue common to the two applications.