Java Gold Australia and Ors – v – Java Gold Coffee and Ors
[2013] VCC 998
•16 August 2013
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE CIVIL DIVISION | Revised Not Restricted |
COMMERCIAL LIST
EXPEDITED CASES DIVISION
Case No. CI-11-02989
| JAVA GOLD AUSTRALIA PTY LTD & ORS (ACCORDING TO THE SCHEDULE ATTACHED) | Plaintiffs |
| - v - | |
| JAVA GOLD COFFEE INTERNATIONAL PTY LTD & ORS (ACCORDING TO THE SCHEDULE ATTACHED) | Defendants |
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JUDGE: | HER HONOUR JUDGE KENNEDY | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 14 August 2013 | |
DATE OF RULING: | 16 August 2013 | |
CASE MAY BE CITED AS: | Java Gold Australia & Ors – v – Java Gold Coffee & Ors | |
MEDIUM NEUTRAL CITATION: | [2013] VCC 998 | |
REASONS FOR COSTS RULING
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Catchwords: Practice and Procedure – appropriate order for costs for successful co-defendant where defendants jointly represented.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiffs | Mr S. Stuckey | Ponte Earle |
| For the 4th Defendant | Mr L. Wirth | TF Grundy |
HER HONOUR:
1 This is an application for costs brought by the fourth defendant following the delivery of reasons in this matter on 26 July 2013 and the making of orders on 30 July 2013. Those orders included an order, inter alia, that the plaintiffs’ proceeding against the fourth defendant be dismissed.
2 The issue remaining is what costs order should be made in relation to the costs of the fourth defendant, including the costs of a short hearing which occurred on 14 August 2013.
Background
3 The fourth defendant was jointly represented in the proceeding up until the date of 8 February 2013 by TF Grundy, at which time TF Grundy ceased to act for the first – fourth defendants, and continued to act only on behalf of the fifth defendant.
4 The fourth defendant did not appear at the trial; nor (despite notification) on the date the reasons were delivered; nor on 30 July (at which time it was anticipated that any costs submissions would be made). However, by order 7 of the order of 30 July, the fourth defendant was given a further opportunity to make an application for her costs of the proceeding provided she notified such an intention by 4 pm on Thursday, 1 August 2013. In the result, by email of 1 August, her former solicitors, TF Grundy, advised that they had been instructed to make an application for the fourth defendant’s costs. An oral hearing was thereby arranged for 14 August.
5 At the oral hearing, Mr Wirth of counsel appeared and sought an order for the fourth defendant’s costs up to the date her solicitor went off the record (on 8 February 2013) on the basis that costs should ordinarily follow the event.
6 Mr Stuckey of counsel appeared and opposed the making of such an order. In particular, he submitted:
(i)that no order for costs should be made (citing the decision in Scherer & Anor v Counting Instruments Ltd)[1];
(ii)that, alternatively, only costs exclusively referrable to the fourth defendant should be allowed for (citing a decision in Anzaway v Maroun Corporation (No.2));[2]
(iii)that, alternatively, on the basis of the “rule of thumb” cited in the Court of Appeal decision in Spotless Group Ltd v Premier Building & Consulting Pty Ltd & Anor,[3] that the fourth defendant should only be entitled to a fifth of the joint costs incurred plus the costs, if any, incurred exclusively on her behalf.
Resolution
[1][1986] 1 WLR 615, particularly at 621.
[2][2003] NSWSC 725, particularly at [16].
[3][2008] VSCA 115.
7 In Scherer the English Court of Appeal summarises a number of relevant propositions as to costs, including the following:
If a party invokes the jurisdiction of the court to grant him some discretionary relief and establishes the basic grounds therefor [sic] but the relief sought is denied in the exercise of discretion … the opposing party may properly be ordered to pay his costs.[4]
[4][1986] 1 WLR 615, 621.
8 Mr Stuckey submitted that, given the plaintiffs had established the existence of the misleading conduct and only failed against the fourth defendant on an exercise of discretion under the Fair Trading Act 1999 (Vic) (having regard to the impact on third parties[5]), then the plaintiffs should not pay costs.
[5]Reasons dated 26 July 2013 [202].
9 However, the plaintiffs’ claims against the fourth defendant extended beyond a claim based on misleading conduct and were not rejected solely on the basis of the exercise of a discretion.[6] Overall, then, I do not regard the passage in Scherer as displacing the normal order.
[6]Reasons dated 26 July 2013 [200] – [207].
10 Before examining the decision in Anzaway, it is necessary to understand the “rule of thumb” described in Spotless as examined by Einstein J in Currabubula Holdings Pty Ltd v State Bank of NSW.[7]
[7][2000] NSWSC 232.
11 The “rule of thumb” is that where two or more defendants in the same proceeding have the same legal representation each successful defendant is entitled to its proportion of the costs incurred on behalf of all plus the costs, if any, incurred exclusively on any individual defendant’s behalf. The Court is not obliged to apply the rule and will not do so where its application would involve an injustice.[8]
[8]Spotless Group Ltd v Premier Building & Consulting Pty Ltd & Anor [2008] VSCA 115 [39] and [42].
12 From an examination of the defences in this case, it appears that they were substantially similar. In such circumstances, I consider that the ordinary “rule of thumb” described in Spotless is applicable.
13 It is true that in Anzaway, the New South Wales Supreme Court made no order for a proportion of the joint costs of certain jointly represented defendants and only made an order for their incremental costs.[9] However, such a result appears to flow from the way the evidence was led at the trial. This is distinguishable from the present case where the costs sought by the fourth defendant do not include any costs of the hearing.
[9]Anzaway v Maroun Corporation (No.2) [2003] NSWSC 725 [16].
14 Counsel for the fourth defendant did not suggest that there would be any reason why an application of the “rule of thumb” would involve an injustice in the circumstances of this case. Rather, the emphasis was that this was a matter that should be dealt with instead by the Costs Court.
15 However, a simple order that the plaintiffs pay the fourth defendant’s costs may leave open too much scope for further dispute in the Costs Court. I therefore consider that the “rule of thumb” is an appropriate order in this case.
Costs of 14 August
16 The fourth defendant has not been successful in obtaining an order in the terms sought. However, the plaintiffs have obtained an order in terms sought only in their (third) “fall back” position.
17 As neither side has been completely successful, it is appropriate that no order should be made as to the costs of the hearing on 14 August.
Conclusion
18 The orders of the Court will be as follows:
(i)the plaintiffs pay the fourth defendant:
(a)one-fifth of the joint costs incurred on behalf of the first – fifth defendants; and
(b)the costs, if any, incurred exclusively on the fourth defendant’s behalf;
up until 8 February 2013.
(ii) There be no order as to the costs of the hearing of 14 August 2013.
SCHEDULE OF PARTIES
| JAVA GOLD AUSTRALIA PTY LTD (ACN 145 240 884) | First Plaintiff |
| JAVA MANAGEMENT SERVICES PTY LTD (ACN 145 575 444) | Second Plaintiff |
| DAVID PAUL SANDERS | Third Plaintiff |
| and | |
| JAVA GOLD COFFEE INTERNATIONAL PTY LTD (ACN 134 085 484) | First Defendant |
| UNITED WORLD INTERNATIONAL TRADING COMPANY PTY LTD (ACN 134 201 264) | Second Defendant |
| BRIAN CHAPMAN NORTON | Third Defendant |
| SITI KHOLIFAH | Fourth Defendant |
| GEOFFREY HESFORD | Fifth Defendant |
| and | |
| JAVA GOLD COFFEE INTERNATIONAL PTY LTD (ACN 134 085 484) | First Plaintiff by Counterclaim |
| UNITED WORLD INTERNATIONAL TRADING COMPANY PTY LTD (ACN 134 201 264) | Second Plaintiff by Counterclaim |
| BRIAN CHAPMAN NORTON | Third Plaintiff by Counterclaim |
| JAVA GOLD HOLDINGS LIMITED (ACN 139 914 604) | Fourth Plaintiff by Counterclaim |
| THE WORLD BANK OF COFFEE PTY LIMITED (ACN 139 837 424) | Fifth Plaintiff by Counterclaim |
| and | |
| JAVA GOLD AUSTRALIA PTY LTD (ACN 145 240 884) | First Defendant by Counterclaim |
| DAVID PAUL SANDERS | Second Defendant by Counterclaim |
| CDIG AUSTRALIA CO PTY LTD (ACN 130 824 412) | Third Defendant by Counterclaim |
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