HUNTLEY MANAGEMENT LTD as responsible entity of the TFS SANDALWOOD PROJECT 2002 ‑v- SANDALWOOD GROWERS CO-OP LTD
[2020] WASC 186
•29 MAY 2020
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: HUNTLEY MANAGEMENT LTD as responsible entity of the TFS SANDALWOOD PROJECT 2002 ‑v- SANDALWOOD GROWERS CO-OP LTD [2020] WASC 186
CORAM: HILL J
HEARD: ON THE PAPERS
DELIVERED : 29 MAY 2020
PUBLISHED : 29 MAY 2020
FILE NO/S: CIV 3043 of 2019
BETWEEN: HUNTLEY MANAGEMENT LTD as responsible entity of the TFS SANDALWOOD PROJECT 2002
Plaintiff
AND
SANDALWOOD GROWERS CO-OP LTD
Defendant
Catchwords:
Costs - Costs of application - Orders ultimately not opposed by defendant - Whether plaintiff largely successful - turns on own facts
Legislation:
Rules of the Supreme Court 1971 (WA)
Result:
The defendant pay the plaintiff's costs fixed in the sum of $2,178 and payable forthwith
Category: B
Representation:
Counsel:
| Plaintiff | : | Mr C M Slater |
| Defendant | : | Mr M A Robson |
Solicitors:
| Plaintiff | : | Jackson McDonald |
| Defendant | : | Robson Legal |
Case(s) referred to in decision(s):
Huntingdale Village Pty Ltd (Receivers and Managers appointed) ATF Huntingdale Village Unit Trust v Perpetual Nominees Ltd [2013] WASC 352 (S)
HILL J:
On 8 April 2020 at 5.04 pm, the plaintiff by letter requested that these proceedings be listed for an urgent hearing for orders that the defendant deliver up possession of timber from the crop of Santalum album trees the subject of the TFS Sandalwood Project 2002 (Timber) which is the subject of the dispute in these proceedings. The basis for the urgency was to enable the plaintiff to complete an asset sale agreement with a third party concerning the sale of the Timber prior to the expiration of a notice given by that third party on 6 April 2020 (Notice). Under the terms of the asset sale agreement, unless completion occurred within five business days of the Notice, the third party was entitled to terminate the agreement.
The matter came on before me for hearing on 9 April 2020 at 3.00 pm. At the conclusion of the hearing, I made orders:
(a)vacating order 1(a) of the Orders previously made on 4 December 2019 (which restrained the defendant from moving the Timber from the defendant's warehouse in Kununurra); and
(b)declaring that the Timber is held by the defendant on behalf of the plaintiff for the purpose of completing the agreement dated 6 February 2020 between the plaintiff as seller and [the third party] as buyer.
At the conclusion of the hearing, both parties sought their costs in relation to the hearing. I gave the parties liberty to file submissions in support of their application for costs and ordered that the application be determined on the papers.
Application by the plaintiff
The plaintiff seeks an order that the defendant pay its costs of the application in accordance with item 2.8 of the schedule to Practice Direction 4.7.1.1 of the Consolidated Practice Directions of the Supreme Court.
The basis for the plaintiff's application is that prior to the application, it sought assurances from the defendant that it would cooperate to complete the sale which assurances were not provided. For this reason, the plaintiff was required to seek the assistance of the court to enable it to complete the sale.
The plaintiff asserts that the costs of the application were necessary because of the defendant's conduct and that it was only during the course of the hearing that the defendant indicated its intention to consent to orders.
The plaintiff referred to the Consolidated Practice Directions 4.7.1(1) ‑ (3) which provide that, as a general rule, in interlocutory applications, costs should be fixed and ordered to be paid forthwith. The schedule in Consolidate Practice Direction 4.7.1.1 sets out the costs that judicial officers can be expected to make in the usual course. For a contested interlocutory application of a hearing of no more than two hours' duration, the schedule provides for an amount of $2,178.
Application by the defendant
The defendant seeks orders that the plaintiff pay the defendant's costs of the application on an indemnity basis, alternatively on a party‑party basis. The defendant also seeks orders that the plaintiff pay the defendant's costs of the preparation of its submissions in support of costs.
The defendant contended that it was the plaintiff's conduct which required the matter to be listed and resulted in costs being unnecessarily or unreasonably incurred. For this reason, the defendant submitted that this was an appropriate case for an order to be made under O 66 r 1(2) of the Rules of the Supreme Court 1971 (WA) requiring the plaintiff to pay the costs of the defendant, as the unsuccessful party to the application.[1]
[1] See Huntingdale Village Pty Ltd (Receivers and Managers appointed) ATF Huntingdale Village Unit Trust v Perpetual Nominees Ltd [2013] WASC 352 (S) [17].
In support of this submission, the defendant contended that:
(a)the defendant did not receive any request for inspection or possession of the Timber until 8 April 2020, which was after settlement of the agreement should have occurred;
(b)there was no dispute between the parties as to the plaintiff's right to the Timber as the responsible entity for the TFS Sandalwood project 2002;
(c)as a consequence, the declaration sought by the plaintiff was not necessary, had no utility or consequence; and
(d)the hearing on 9 April 2020 was adversarial solely because that it was necessary for the defendant to prevent orders being made which would have amounted to a final determination of the matters in dispute in the proceedings.
Disposition
The costs of an interlocutory proceeding is in the discretion of the court. The usual rule is that costs follow the event.[2] Ordinarily, this is a just outcome because a party who has required the other party to apply to the court to enforce the rules or procedure of the court or who has unjustifiably resisted the application should be required to recompense the applicant for its costs.
[2] Rules of the Supreme Court, O 66, r 1(1).
The question as to whether the hearing on 9 April 2020 was necessary was complicated by an issue that had arisen between the defendant and its then solicitor. At the hearing, Mr Vallve who appeared for the defendant stated that he no longer represented the defendant, and did not have instructions in respect of the matter. However, no notice of change of representation had been filed nor had the defendant's solicitors filed any application for leave to withdraw as solicitors on the record.
For this reason, from 6 April 2020 until the hearing, the plaintiff's solicitors corresponded with the defendant's solicitors as they were required to do. This included sending a copy of the Notice on 6 April 2020 (which was copied to a director of the defendant and sent by email).[3]
[3] Affidavit of Chelsea Lee Quirk filed 9 April 2020, 'CLQ-08'.
Shortly prior to the hearing, a director of the defendant wrote to the solicitors for the plaintiff, which was copied to the court indicating that:
(a)prior to 6 April 2020, the defendant had not received any request to attend to any matters concerning settlement;
(b)the defendant agreed to allow the third party to inspect the Timber prior to settlement and allow the purchaser to take possession of the timber if settlement occurred; [emphasis added]
(c)it required all representatives to comply with standard occupational health and safety procedures as well as the Biosecurity (Human Biosecurity Emergency) (Human Coronavirus with Pandemic Potential) (Emergency Requirements for Remote Communities) Determination 2020 made pursuant to the Biosecurity Act 2015 (Cth) on 26 March 2020.
To enable Mr Vallve, as the solicitor on the record for the defendant, to take instructions from the defendant, the court adjourned the hearing.
When the matter came back on after an adjournment of almost 90 minutes, the defendant submitted that the application should be dismissed in its entirety as the application was premature. The defendant asserted that it had not received a request to deliver up the Timber and that until this occurred, no orders should be made.
The hearing was adjourned on the application of the defendant for a second time. When the matter came back on for hearing, counsel for the defendant indicated that orders could be made by the court without objection.
There is no evidence before me as to whether the plaintiff had informed the defendant that it had entered into the agreement prior to 6 April 2020. I note that the letter from Jackson McDonald to the defendant's solicitor[4] states that 'as you know', the plaintiff had entered into the agreement. There is no evidence before me as to how this was previously communicated to the defendant or when.
[4] Affidavit of Chelsea Lee Quirk filed 9 April 2020, 'CLQ-08'
While I consider that any failure to communicate with the defendant until after the Notice had been served contributed to the necessity of the hearing on 9 April 2020, ultimately, I consider the primary reason for the hearing was the failure of the defendant to clearly state its position. Had the defendant done so, I consider that orders could have been made disposing of the matter without the necessity of a hearing.
In that regard, I do not consider that the submissions by the defendant's new solicitors at [9(a) and (b)] accurately represent the position of the defendant at the hearing or the submissions that were made at the hearing.
The hearing was required so that orders could be made so that the asset sale agreement could complete. The plaintiff obtained orders to this effect. For this reason, I consider that the plaintiff was largely successful at the hearing.
I see no good reason in this case to depart from the usual rule that costs should follow the event and that they should be fixed and paid forthwith. For this reason, it is my view that the defendant should pay the plaintiff's costs of the chambers summons dated 9 April 2020 fixed in the sum of $2,178 payable forthwith.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
MG
Research Orderly to the Honourable Justice Hill29 MAY 2020
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