Jender v Flood
[2020] VSC 342
•10 June 2020
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST
S ECI 2019 04873
| JENDER PTY LTD (FORMERLY KNOWN AS DAVIS GLASS PTY LTD) (ACN 006 612 577) | Plaintiff |
| v | |
| FLOOD EMERGENCY SERVICES GROUP PTY LTD (ACN 166 955 193) | First Defendant |
| MAGISTRATES’ COURT OF VICTORIA | Second Defendant |
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JUDGE: | Keith JR |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 16 April 2020 |
DATE OF JUDGMENT: | 10 June 2020 |
CASE MAY BE CITED AS: | Jender v Flood |
MEDIUM NEUTRAL CITATION: | [2020] VSC 342 |
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COSTS – Refusal of stay of execution of orders of the Magistrates’ Court – Issue as to costs – Should costs be reserved and determined at hearing of the originating motion – Costs a matter of discretion for the Court per s 24 Supreme Court Act 1986 – Discretion to be exercised judicially and not capriciously - Purposes of costs to compensate party in whose favour the order is made, not to punish the party against whom it is made – Costs to reflect justice of the situation – Appropriate time to consider costs is at conclusion of proceeding, following determination of merits of the originating motion – Future conduct of parties may be relevant to overall costs of the proceeding – Parties submissions regarding costs surprising in light of the low quantum of the judgment made by the Magistrates’ Court of Victoria – Costs reserved.
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APPEARANCES: | Counsel | Solicitors |
| Mr J Lipinski via telephone for the Plaintiff | ||
| Mr R Watson-Jones via telephone for the First Defendant | ||
JUDICIAL REGISTRAR:
On 16 April 2020 I heard submissions on an urgent summons filed in this proceeding by the plaintiff on 9 April 2020. The Summons sought two orders. The first order sought was for a stay of execution of orders of the Magistrates’ Court the subject of this appeal. The second order sought was for leave to amend the originating motion to seek relief in different terms.
The application for a stay was referred to me for hearing and determination by order of Daly AsJ made on 15 April 2020 and pursuant to Order 84.04 of the Supreme Court (General Civil Procedure) Rules 2015. The application for leave to amend has not been the subject of a referral.
On 16 April 2020 I refused to stay enforcement of the Magistrates Court orders. I reserved costs of the application for a stay. Both parties have filed submissions in relation to costs.
I did not, on 16 April 2020, provide reasons for my decision to refuse the stay. The hearing was conducted by telephone. The notes made of the reasons for my decision are now provided as an attachment to this ruling. They are intended to be in the nature of ex tempore remarks for my decision to refuse the stay. The issues are relevant to this ruling as to costs.
The plaintiff submits the costs be reserved and determined at the hearing of the originating motion. Written submissions were filed in support of that position on 11 May 2020.
The defendant submits the costs of the summons should be paid by the plaintiff on an indemnity basis. Written submissions were filed on 8 May 2020. The defendant filed, and relies upon, the affidavit of the solicitor filed on 8 May 2020.
On 16 April 2020 the orders by which I refused the stay included the balance of the summons dated 9 Aril 2020 remained for the parties to list if so advised. There is no order of the Court that the application to amend be referred to me for hearing and determination.
The plaintiff has effectively abandoned the application to amend. Correspondence has been exhibited to an affidavit of the solicitor for the defendant filed on 8 May 2020. The exhibits to that affidavit include, at page twenty, a letter dated 4 May 2020 in which the solicitor for the plaintiff said “our client has instructed us to withdraw the summons, and we will advise the court accordingly.” It is clear from the letter the intent is to withdraw the amendment application made in the summons rather than the whole summons.
The defendant seeks an order the summons be dismissed. The defendant requested pursuant to my order of 16 April that the balance of the summons be dealt with. The Court indicated the application to amend would be considered on the papers. There is now no need to consider the application to amend as it has been abandoned by the plaintiff.
I agree the summons cannot be withdrawn in its entirety, as part of it has been heard. As the plaintiff does not seek to press the application to amend, the summons will be dismissed.
Although I have dismissed the summons, I do not consider an order for costs should follow in the circumstances of this case. Costs are in the discretion of the Court by virtue of section 24 of the Supreme Court Act 1986. It is well established the discretion must be exercised judicially and not capriciously.[1] I recognise there is a common approach that a successful party is, in the absence of good reasons to the contrary, able to recover costs. The matter remains one of discretion in each case. The purpose of a costs order is to compensate the party in whose favour the order is made, and not to punish the party against whom it is made.
[1]Towercom Pty Ltd v Fahour (No 4) [2013] VSC 585 and cases there cited.
The use of an order that costs of an interlocutory application be reserved is recognised in the commentary to the rules at (63.20.0) and (63.20.15) and cases there mentioned. In one of those cases it is remarked the reason that on many interlocutory questions the costs are reserved, is the primary concern that an order for costs reflect the justice of the situation.[2]
[2]O’Keeffe Nominees Pty Ltd v BP Australia Ltd [1995] FCA 109; 55 FCR 591 per Spender J, in the penultimate paragraph.
In this case I consider there are good reasons to not make an order at this stage of the proceeding in favour of the party who has been successful on the summons. The proper order in the exercise of my discretion is the costs of the summons, including the amendment application, be reserved. The judicial officer hearing the merits of the proceeding may be asked to consider whether any separate order for costs is appropriate or if the costs are properly costs of the proceeding. It may be some other order will be considered appropriate.
I am not satisfied Rule 63.15 has the consequence submitted by the defendant. The rule refers to a party who “discontinues or withdraws a part of a proceeding, counterclaim or claim by third party notice.”
The rules define the word “proceeding” in Rule 1.13 (unless the context or subject matter otherwise requires) to mean “any matter in the Court commenced by writ or originating motion or as otherwise provided [etc.]”.
It is not necessary to conclude the question of interpretation of the Rules because on the approach advanced by the defendant that Rule 63.15 does apply I would “otherwise order” to prevent that rule having immediate effect.
I consider it appropriate to exercise my discretion and order the costs of the summons be reserved taking into account the nature of these proceedings for judicial review and the fact the amount of the judgment in the Magistrates Court is of the order of $5,000.
The Civil Procedure Act 2010, per s 65, provides the Court may make any order as to costs considered appropriate to further the overarching purpose. The section expressly provides in s 65(3) that any order may be made at any time in a proceeding and in relation to any aspect of a proceeding, including any interlocutory proceeding.
The defendant has provided detailed submissions as to costs and in support of an order for indemnity costs. The submissions draw upon the Civil Procedure Act and the obligations imposed on litigants and legal practitioners.
My view is the appropriate time to consider those issues is at the conclusion of the proceeding and after the determination of the merits of the Originating Motion. The proceeding is listed for hearing in September 2020. The order that costs of the summons be reserved does not prevent the defendant from advancing the submissions and seeking costs orders as may be appropriate.
In the correspondence and submissions before me, both parties seek to rely on the Civil Procedure Act and both parties submit the asserted contraventions of obligations under that Act by the other party should be considered on the question of costs. The proceedings are not yet concluded and there may be future conduct relevant to the ultimate determination of costs of the proceedings.
Section 28 of the Civil Procedure Act allows the Court, when exercising its discretion as to costs, to take into account any contravention of the overarching obligations. I consider in this proceeding those matters should not be taken into account in a piecemeal fashion. Rather the conduct of each of the parties and their representatives can properly be assessed for the purposes of that discretion as to costs at the conclusion of the proceedings and after determination of the Originating Motion.
Section 24 of the Civil Procedure Act may have a part to play in the conclusion as to costs in these proceedings. The facts of the case appear to show the plaintiff was not the customer who engaged the defendant to perform its services. The parties appear to know the identity of the party that did engage the defendant and received the benefits of the services provided. It might be thought a commercial solution could have been found once the identity of the liable party was known. It remains the case the defendant holds a judgment from the Magistrates’ Court because the plaintiff failed to act to take steps to defend the proceedings. The Magistrates’ Court refused the application to set aside that judgment. The merits of this proceeding will determine whether the plaintiff is entitled to judicial review of that decision.
The purpose of these observations is not to indicate where the merit falls but to indicate surprise that the parties appear to consider the costs incurred in this proceeding to be reasonable and proportionate to the amount in dispute and to the complexity or importance of the issues in dispute.
For these reasons, I consider the justice of the situation requires the costs of the summons filed by the plaintiffs on 9 April 2020 be reserved.
ORDERS
1. The Plaintiff’s Summons filed on 9 April 2020 be dismissed.
2. Costs reserved.
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