J C Butko Engineering Pty Ltd v Talis Civil Pty Ltd (No 2)
[2021] NSWDC 823
•10 December 2021
District Court
New South Wales
Medium Neutral Citation: J C Butko Engineering Pty Ltd v Talis Civil Pty Ltd (No 2) [2021] NSWDC 823 Hearing dates: 10 December 2021 Date of orders: 10 December 2021 Decision date: 10 December 2021 Jurisdiction: Civil Before: P Taylor SC DCJ Decision: (1) Defendant's application is refused.
(2) Confirm the orders made on 29 October 2021.
(3) Order the defendant to pay the costs of the defendant's application to vacate and vary the costs order.
Catchwords: COSTS – plaintiff successful in obtaining summary judgment on substantial part of its claim – parts of defence struck out – plaintiff awarded costs to date – costs follow the event – circumstances of partial success – discretion
Legislation Cited: Uniform Civil Procedure Rules 2005, r 42.1, r 42.7
Cases Cited: J C Butko Engineering Pty Ltd v Talis Civil Pty Ltd [2021] NSWDC 735
Category: Procedural rulings Parties: J C Butko Engineering Pty Ltd (plaintiff)
Talis Civil Pty Ltd (defendant)Representation: Counsel:
Solicitors:
Mr J Dooley (plaintiff)
Ms A Carr (defendant)
James G Sloan Lawyers (plaintiff)
Moray & Agnew (defendant)
File Number(s): 2021/00019703 Publication restriction: None
Judgment
Introduction
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The defendant, Talis Civil Pty Ltd, applies pursuant to liberty granted on 29 October 2021 to vacate a costs order made in favour of the plaintiff, JC Butko Engineering Pty Ltd. Talis Civil seeks, in its place, a court order that there be no order as to the costs of the motion.
Background
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On 29 October 2021 I gave judgment in favour of JC Butko in the sum of $351,638.92, and made other orders including that Talis Civil pay the costs of the proceedings to date. [1] The orders resulted from an application by JC Butko for summary judgment on two payment claims, called Payment Claim 13 and Payment Claim 14, and to strike out certain parts of the defence.
1. J C Butko Engineering Pty Ltd v Talis Civil Pty Ltd [2021] NSWDC 735.
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Talis Civil did not oppose the strike out orders at the hearing of the application, it failed in respect of Payment Claim 13 but it resisted summary judgment in respect of Payment Claim 14.
Arguments
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Talis Civil submits that the appropriate costs order be that there be no order as to the costs of the notice of motion. [2] It argues that each party has had equal success: the plaintiff has succeeded in obtaining summary judgment on one payment claim, but not on the other.
2. Defendant’s submissions, 7/12/21, at [4].
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JC Butko submits that the costs order was a proper exercise of the Court’s discretion, on the basis that the plaintiff succeeded in respect of one of the two payment claims and that the defendant challenged, then withdrew the challenge to the form of both payment claims and to the valid service of Payment Claim 14.
Analysis
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The motion and the orders of the Court cover more than the questions of summary judgment. The motion also sought an order striking out certain paragraphs of the defence, and it sought summary judgment on two payment claims. It failed to obtain summary judgment on one payment claim but otherwise succeeded.
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The weakness of the defendant’s case is informed by its capitulation before hearing on the strike out component of the motion, its withdrawal of its challenge to the form of the payment claims and the service of Payment Claim 14, and its failure to resist a summary judgment application in respect of Payment Claim 13. Its case was not weak on the summary judgment application in respect of Payment Claim 14, where it successfully resisted summary judgment.
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Where a notice of motion involves two interlocutory issues of equal weight and importance, and where each party has had success on one issue, there is some force in the submission that each party should bear its own costs, or, bearing in mind r 42.7 of the Uniform Civil Procedure Rules 2005, that costs of the motion be costs in the proceedings. But that circumstance is of little relevance in this case for a number of reasons.
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First, while the refusal to grant summary judgment in respect of the second payment claim is an interlocutory order, an order for judgment on the first payment claim is not. That is a final order, and the successful party is ordinarily entitled to the costs of the proceedings because, generally, costs follow the event under r 42.1. Had the plaintiff succeeded in obtaining judgment for the sum ordered in circumstances where the plaintiff had sought judgment for a greater sum (such as because of the other payment claim), there may have been an argument that the costs order should be reduced. But it is unlikely as a general rule that a successful plaintiff would receive no costs of the proceedings, especially where the success is substantial, as it is here.
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In this case, the plaintiff has wholly succeeded summarily on one payment claim, and the second remains to be determined. That circumstance indicates that JC Butko is entitled to a favourable cost order for the proceedings to date.
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Secondly, as the submission of JC Butko reveals, the motion was not solely about summary judgment, but also about the strike out of certain parts of the defence, a matter where the Court can assume, given the concession of the defendant, that those parts of the defence had no merit. The same is true with respect to the failed or withdrawn challenges to form, and service. That Talis Civil was able to preserve a defence to Payment Claim 14 to another day is a matter to be considered, but it does not weigh evenly to balance the other matters, in circumstances where the proceedings are now partially concluded.
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It is also my view that the hearing on the notice of motion would not have been substantially shorter on the two separate hearing days if the motion did not seek summary judgment in respect of Payment Claim 14. In the circumstances of the hearing, both days would have been required in any event.
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A defendant that wishes to protect itself against costs from an adverse judgment for a lesser sum than is sought, can avail itself of the offer of compromise procedure in the Uniform Civil Procedure Rules or with a Calderbank offer. That Talis Civil apparently chose not to do so in circumstances where substantial parts of its defence were likely to be (and were) struck out or rejected summarily, weakens its argument against a costs order assessed on the ordinary basis.
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Now that the proceedings have removed the unmeritorious parts of the defence, if the plaintiff persists with the remaining part of its claim, and if the defence succeeds, Talis Civil might be expected to have a strong argument for the costs of the proceedings after 29 October 2021.
Orders
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The orders of the Court are:
Defendant's application is refused.
Confirm the orders made on 29 October 2021.
Order the defendant to pay the costs of the defendant's application to vacate and vary the costs order.
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Endnotes
Decision last updated: 26 October 2022
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