Kahu NZ Ltd v Aviation Utilities Pty Ltd - [2022] WASC 405

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL

CITATION:   KAHU NZ LTD -v- AVIATION UTILITIES PTY LTD [2022] WASC 405
CORAM:   SOLOMON J
HEARD:   4 NOVEMBER 2022
DELIVERED          :   4 NOVEMBER 2022
PUBLISHED           :   24 NOVEMBER 2022
FILE NO/S:   CIV 2012 of 2022
BETWEEN:   KAHU NZ LTD
Plaintiff
AND
AVIATION UTILITIES PTY LTD
Defendant

Catchwords:

Equity - Interlocutory injunction - Mandatory injunction - Personal services contracts - Adequacy of damages - Turns on own facts

Costs - Whether reason to depart from the ordinary course

Legislation:

Competition and Consumer Act 2010 (Cth), sch 2 ('Australian Consumer Law')

Result:

Application dismissed

Category: B

Representation:

Counsel:

Plaintiff	:	P J Hannon
Defendant	:	S M Davies SC

Solicitors:

Plaintiff	:	Peter May McAuliffe Legal (Busselton)
Defendant	:	Norton White

Case(s) referred to in decision(s):

Centreplex Pty Ltd v Noahs Rosehill Waters Pty Ltd [2019] WASC 252
Mineralogy Pty Ltd v Sino Iron Pty Ltd [2016] WASCA 105
Perdaman Chemicals and Fertilisers Pty Ltd v Griffin Coal Mining Company Pty Ltd [No 3] [2011] WASCA 203 (S)
RB (Hygiene Home) Australia Pty Ltd v Henkel Australia Pty Ltd (No 2) [2021] FCA 1194

SOLOMON J:

(This judgment was delivered extemporaneously and has been edited from the transcript.)

This is an application for urgent interim injunctive relief in the form of mandatory orders requiring the defendant to utilise the plaintiff's services, pursuant to the contract entered into by the parties.
The background may be summarised as follows.
The plaintiff is a company that has for some time engaged in and has, it appears, plentiful experience in the aerial combating of fires. It has undertaken many contracts for government agencies in what is commonly referred to as firefighting, including the use of helicopters and other aerial devices to combat the spread of bush fires. It goes without saying that in this country that is a vital and important service, and the contracts for the provision of those services have an element of great public importance.
Firefighting efforts in Australia and in different states are coordinated through a number of entities and sub-entities that have representative agencies in the different states. The Australasian Fire and Emergency Service Authorities Council Limited (AFAC) is a public company limited by guarantee which has agreements with 'Members' representing each State or Territory. In Western Australia the relevant Member is the Department of Fire and Emergency Services (DFES). Each Member authorises the AFAC to procure and manage aerial firefighting resources on behalf of the Member. Within AFAC there is a business unit that manages the relevant contracts, namely the National Aerial Firefighting Centre (NAFC).
For present purposes, it is sufficient to observe that by a letter dated 30 August 2021, AFAC/NAFC, effectively on behalf of DFES, engaged the defendant to provide what I shall refer to very broadly as firefighting services (AFAC contract). The terms of that contract are embodied in the letter of 30 August 2021, and also a pro-forma contract of the AFAC and its contracting arm, the NAFC. That is a comprehensive pro forma document which appears to be incorporated into the relationship between the AFAC/NAFC and the defendant by the letter dated 30 August 2021.
By letter dated 1 September 2021, the defendant engaged the plaintiff company to provide aspects of the services under the AFAC contract. In particular, the plaintiff was engaged to provide a piloted Black Hawk helicopter to assist the defendant in the provision of its services. The terms of the engagement between the defendant and the plaintiff are set out in the letter of 1 September 2021 (Kahu contract). The Kahu contract was entered into by the plaintiff through its director, Mr Mark Law, who is also the 'Chief Pilot' for the plaintiff company in the performance of the firefighting services.
The terms of the Kahu contract included that the plaintiff was required to study the entirety of the AFAC contract and to comply with all its requirements, conditions and specifications. Clause 4 of the Kahu contract is important in the dispute between the parties and provided that the defendant, 'is the only point of contact in all matters relating to the NAFC, its members, and state and territory agencies'. Clause 8 provided that the plaintiff was 'responsible for the maintenance of a contracted helicopter'.
The defendant, with the assistance of the plaintiff, engaged in firefighting services for the bushfire season in Western Australia over the summer of 2021/2022 pursuant to the AFAC contract and the Kahu contract.

Purported termination of the contract

On 27 May 2022, the defendant issued the plaintiff with a letter entitled 'Notice of Contract Breach and Request for Explanation'. The notice alleged two breaches of the Kahu contract by the plaintiff and requested an explanation in respect of those breaches. An explanation was provided by the plaintiff by letter dated 7 June 2022. In response, on 2 August 2022 the defendant purported by letter to terminate the Kahu contract with the plaintiff. It thus sought to bring the Kahu contract to an end for the coming bushfire season, which is imminent, the summer of 2022/2023.
The termination notice issued by the defendant relied on two alleged breaches. One is what the parties referred to in the evidence as a 'social media breach'. This related to a photograph posted by the plaintiff on its social media platform around 9 February 2022, in which certain apparently confidential or sensitive information was visible. This appears to have rendered the defendant in breach of the AFAC contract, and the defendant in turn advised the plaintiff that in the defendant's view the plaintiff was in breach of the Kahu contract. In that regard, it appears on the evidence that the plaintiff did not contest that it was in breach and, indeed apologised for the breach by email from Mark Law on 12 February 2022. In response, Sam Borg, the defendant's Chief Pilot responded to Mark Law on 13 February 2022 in a fairly amicable fashion, concluding 'we shall carry on smarter for the experience'. The Kahu contract continued unabated after that.
The next breach upon which the defendant relied in its purported notice of termination related to a meeting that took place between Mark Law and a Mr Bannister, a representative of DFES on 27 April 2022. Mr Law gives a particular account of the reason for that meeting but before exploring that aspect, it is necessary to refer to one further important aspect of the background.
The principal focus of the services to be provided by the plaintiff was the use of a Black Hawk helicopter together with a water tank which had the capacity to scoop up, at a very fast rate, approximately four and a half thousand litres of water, carry it to a fire and then with particular skill, effectively water bomb or distribute that water on the fire. Mr Law, on behalf of the plaintiff, raised complaints early in the performance of the Kahu contract relating to what he understood to be inadvertent droppings, that is, instances of the water tank opening and dropping its contents inadvertently without warning.
The inadvertent opening of the tank dropping four and a half thousand litres of water in an unplanned manner is, plainly, extremely dangerous and creates a risk both to property and life. Mr Law's position is that he raised his concerns, as he was required to do, repeatedly, not only with the defendant but with the provider of the water tank which was in the United States. I have received in evidence email exchanges from Mr Law both with the defendant and with the American provider of the tank. Some of those communications are robust in the manner in which Mr Law expressed his view. Whether they were inappropriately aggressive as the defendant seems to think, is not a matter I can determine, other than to observe that if Mr Law genuinely held the views he appears to have held in relation to public safety, then one can well understand why he would have expressed his views in robust terms.
The defendant's position is that the defect that caused the inadvertent openings of the tanks were few and far between, and in any event had been rectified by March 2022.
Mr Law does not appear to have been persuaded that the problem had been entirely rectified and that brings me back to the meeting with Mr Bannister on 27 April 2022. Mr Law's account of that meeting, in very broad terms, was that he wished to speak to Mr Bannister regarding an alternative bucket system which Mr Law himself had developed. On Mr Law's account, Mr Bannister initiated and raised with him issues in relation to the water tank at which point Mr Law disclosed to him his concerns in relation to the inadvertent openings.
During that meeting, Mr Borg came into the same coffee shop where Mr Law was meeting with Mr Bannister. Mr Borg immediately, it appears, became discomforted by the fact that Mr Law was having a meeting with Mr Bannister. He approached the meeting at which point Mr Bannister raised with him the concerns that Mr Law had disclosed the inadvertent openings of the water tank.
By letter dated 4 May 2022 the defendant wrote to Mr Bannister to give its account of the problem in relation to the water tank and to explain what it perceived to be the limited nature of the problem, as well as what the defendant had done to rectify it. The letter expressed regret that the defendant had not informed Mr Bannister of those occurrences, and assured Mr Bannister that it would not happen again. In the meantime, it was plain that the defendant was extremely upset that Mr Law had met with Mr Bannister and discussed matters relating to the provision of firefighting services.
That grievance led to the letter of 27 May 2022 referred to at [9] above. The second breach alleged in that letter referred to the meeting between Mr Law and Mr Bannister of 27 April 2022, and it was alleged that the meeting breached cl 4 of the Kahu contract between the defendant and the plaintiff.
I observe that in the response provided by Mr Law on behalf of the plaintiff to that notice on 7 June 2022, Mr Law gives his account of the background to the meeting. He reiterated his concern about the safety of inadvertent openings and contended in effect, that he had no choice but to disclose those concerns to Mr Bannister. The penultimate paragraph of that letter read:
It's ultimately your choice if I stay or go. I can put my hand on my heart and say I tried my best to keep us safe and operational. Yeah we might have some robust discussions but thats (sic) what we do as leaders and people responsible for others. We have come along (sic) way and I am sure we continue on.
In response to that, as noted above, by letter dated 2 August 2022 the defendant purported to terminate the contract. That letter states:
Having given careful consideration to the matters raised and the options presented in your letter, we have decided that the appropriate course is not to continue with the agreement which we will now terminate.

The proceedings

On 30 September 2022, the plaintiff issued proceedings by writ indorsed with a statement of claim claiming, essentially, that the purported termination of the contract was ineffective and, indeed, unlawful. It also claimed that the purported termination was unconscionable under the relevant provisions of the Competition and Consumer Act 2010 (Cth) sch 2 (Australian Consumer Law).
The substantive relief sought in the statement of claim is a declaration that the contract remained on foot, that the defendant remains obliged to use the plaintiff's helicopters and aerial firefighting services in accordance with the Kahu contract, and various other associated relief including 'a decree in equity for specific performance of the Kahu contract' and, in the alternative, a mandatory injunction requiring the defendant to engage or utilise the plaintiff's helicopters and aerial firefighting services in accordance with the Kahu contract and, in the alternative, damages together with various other injunctive relief both in equity and under the Australian Consumer Law.
On 25 October 2022, the plaintiff brought an application for interlocutory injunctive relief. That is the application before me today. The plaintiff filed the usual certificate of urgency and undertaking as to damages. In substance, the plaintiff seeks orders that the court restrain the defendant from using other helicopters or other entities to provide the services the subject of its agreement with the plaintiff and, effectively, a mandatory interlocutory injunction requiring the defendant to engage the plaintiff to carry out the services the subject of the Kahu contract.

Legal principles

The test for interlocutory relief of this nature in these circumstances was conveniently set out in a case which is not identical but somewhat analogous in the judgment of Le Miere J in Centreplex Pty Ltd v Noahs Rosehill Waters Pty Ltd.[1] In that matter, the defendant, Rosehill, was developing and selling land. It engaged the plaintiff, Centreplex, to provide sales and marketing services. Rosehill gave Centreplex notice purporting to terminate the agreement. Centreplex issued proceedings claiming that the agreement had not been lawfully terminated and sought interlocutory injunctive relief, effectively, to require Rosehill to maintain its engagement of Centreplex.
[1] Centreplex Pty Ltd v Noahs Rosehill Waters Pty Ltd [2019] WASC 252.
Le Miere J set out the relevant principles in that judgment as follows:
Where an applicant seeks an interlocutory injunction, the applicant must identify the legal or equitable rights which are said to be determined at the trial and in respect of which the final relief is sought. An interlocutory injunction in the auxiliary jurisdiction can only lie in order to protect an equitable or legal right, which the plaintiff might enforce by final judgment.
Before the court will exercise its discretion to award an interlocutory injunction, an applicant must satisfy the court that:
(1) there is a prima facie case, in the sense that there is a serious question to be tried as to the plaintiff's entitlement to relief, and a sufficient likelihood of success to justify the preservation of the status quo pending trial;
(2) the plaintiff is likely to suffer injury for which damages will not be an adequate remedy; and
(3) the balance of convenience favours the granting of an injunction.
The question of the adequacy of damages is an aspect of the balance of convenience not a separate requirement. The question of whether the applicant will suffer irreparable injury for which damages will not be adequate compensation involves no more than a consideration of whether the injury cannot properly be compensated in damages, or by some other remedy. The question of whether the injury cannot properly be compensated in damages involves a consideration of whether it is just in all the circumstances that the plaintiff be confined to their remedy in damages.
In assessing the balance of convenience in an interlocutory injunction application, the interests of third persons are relevant and have more or less weight according to other material circumstances. Whether those interests tend to favour the grant or refusal of an injunction in any case depend upon the circumstances of the case. Hardship visited upon third persons by the grant of an interlocutory injunction will rarely be decisive. In this case, the hardship to employees of Rosehill Realty, if the injunction sought is refused and their employment is terminated, is relevant but not decisive.
The requisite strength of the probability of ultimate success depends upon the nature of the rights asserted and the practical consequences likely to flow from the interlocutory order sought, such as the fact that the grant or refusal of the interlocutory application would dispose of the action finally.
The requisite strength of the prima facie case and the balance of convenience are not independent. The more the balance of convenience supports the respondent, and the more serious the consequences for a respondent, the stronger will be the prima facie case the applicant may need to establish to support an interlocutory injunction. Conversely, in a case where the balance of convenience strongly favours the applicant, then the strength of the prima facie case required to support the interlocutory injunction diminishes.
Although the court will often examine the strength of a case for an interlocutory injunction, the court will not normally undertake a preliminary trial and will rarely attempt to resolve disputes of fact. The extent to which the court will consider the merits of disputes as to legal issues will depend on the circumstances of the case. There is no inflexible rule.
There has been conflict in the authorities about whether these principles should apply equally to mandatory interlocutory injunctions. The better approach is that the same principles should apply. The better approach is, as Kiefel J has explained, that the classification of an injunction as mandatory should not automatically attract a requirement that the court should have further confidence in the correctness of the order. The focus should be on the effect of the proposed order. A prohibitory injunction is capable, in some cases, of having a more serious effect on the parties than a mandatory one. There can also be a fine line between an order which requires something to be done and an order which prohibits something from being done; sometimes the former can be re-characterised as the latter. Merely characterising an interlocutory order as mandatory should not invite a different approach.
Nevertheless, the nature of the contract and the appropriateness of the remedy of an interlocutory injunction in the nature of specific performance are closely intertwined concepts. The difficulty of courts supervising contracts has been a major block to the specific enforcement of contracts. Justice Finn has used the classification 'relational contract' to describe 'a contract that involves not merely an exchange, but also a relationship, between the contracting parties'. Courts are generally more reluctant to order injunctions in the nature of specific performance in a case of relational contracts than transactional contracts.
Legal principles concerning the right to terminate a contract
The Agreement contains express rights of termination. However, it is common ground that the express rights of termination conferred by the Agreement operate in addition to any common law rights of termination for breach or repudiation. Rosehill does not rely upon its express right to terminate the Agreement conferred by the Agreement. Rosehill relies upon its right to terminate the Agreement for breach of the terms of the Agreement by Rosehill Realty and for repudiation by Rosehill Realty of its obligations under the Agreement.
The right to terminate the performance of a contract arises relevantly under three circumstances. First, breach of a condition, secondly, the sufficiently serious breach of an intermediate term, and thirdly, repudiation of obligation. A condition is a contractual term any breach of which entitles the promisee to terminate the performance of the contract. An intermediate term is a term the breach of which entitles the promisee to terminate the performance of the contract only if the breach is sufficiently serious.
Where a promisee elects to terminate a contract, what matters is whether the promisee is entitled to do so, not the basis stated by the promisee for doing so. Termination of a contract may be justified by reference to any ground that was valid at the time of termination, even though it was not relied on at the time.
The effect of an election to terminate the performance of a contract for breach or repudiation of obligation is to discharge the parties from the duty to perform their respective contractual obligations. Thus, if Rosehill was entitled to terminate the Agreement, it has done so and both parties are discharged from their duties to perform their contractual obligations.[2]
[2] Centreplex Pty Ltd v Noahs Rosehill Waters Pty Ltd [21] – [33].

Serious question to be tried

The first matter I need to consider is whether there is a serious question to be tried, sometimes characterised as a prima facie case. The prima facie case, relates to whether the purported termination by the defendant was unjustified and thereby unlawful and whether there was, in any event, unconscionable conduct. The question of whether termination was unlawful really turns on the question of whether there was a breach of contract by the plaintiff and if there was, whether it was such a breach as to entitle the defendant to terminate the contract. It is also not sufficient in these circumstances to conclude that the plaintiff has a prima facie case. It is necessary, as best one can at this preliminary stage, to assess the strength of the case.[3]
[3] Mineralogy Pty Ltd v Sino Iron Pty Ltd [2016] WASCA 105 [102].
In my view, there is plainly a serious question to be tried in relation to whether the termination notice was valid and lawful. In respect to the social media breach, it seems to be (at least) strongly arguable that the breach did not give rise to a right to terminate. In any event, in my view the defendant plainly elected to affirm the contract.
It also seems to be that there is a serious question to be tried about whether the meeting with Mr Bannister amounted to a breach, and if it did amount to a breach, whether it was a breach that enabled or entitled the defendant to terminate the contract. In that regard, my preliminary view is that the plaintiff has good prospects of success.
From submissions in opposition to the interlocutory injunction, it emerged that the defendant now relies on other breaches apart from those that are contained in the notice of termination. They relate primarily to what the defendant alleges was the potentially unsafe nature of Mr Law's flying, or operation, of the helicopter.
I note that even though the defendant gave formal notice of breaches for the social media breach and the alleged breach in respect of the meeting with Mr Bannister, nowhere in the correspondence or the documents before me does the defendant allege that Mr Law breached the contract by the manner of his conduct in flying the helicopters. The plaintiff argues, in effect, that the defendant's present reliance on the additional breach or breaches is a recent invention and is not borne out by the contemporaneous documentation.
In respect of the further matters upon which the defendant now relies, I am not in a position at this preliminary stage of the proceedings to determine the extent to which that gave the defendant a right to terminate the contract, if at all. However, in light of the matters relied upon by the defendant in its notice of termination at the relevant time, it seems to be that the plaintiff must enjoy some reasonable prospect of success in its contention that the additional breach or breaches now asserted by the defendant do not attract the significance now sought to be attributed to them by the defendant. It seems to me, that there is also some prospect, that the defendant may be held to have elected to affirm the Kahu contract following these additional alleged breaches if they occurred and otherwise gave rise to a right to terminate.
It thus appears to me at a very preliminary level that in respect of the breaches relied upon by the defendant in the notice of termination, and certainly in respect of the social media breach, the plaintiff has good prospects of demonstrating that the termination was not lawful. In respect of the other breaches upon which the defendant now relies, I think at this preliminary stage all I can observe is that the plaintiff's position is arguable, and it has reasonable prospects of success.
In short then, in my view, there is very clearly a serious question to be tried about the lawfulness of the termination and at least in respect of some aspects of that case, the plaintiff's prospects of success are strong.
I should note that in the correspondence that ensued between the companies and their representatives, there appears to be some suggestion that independently of the breach upon which the notice of termination appears to rely, the paragraph of Mr Law's letter set out at [19] above was somehow an invitation, or an offer, to terminate the contract. That argument was not raised by the defendant in this application in seeking to justify the termination and I think, with respect, for good reason. In my view it is going too far to suggest that the letter written by Mr Law, a person who is not a lawyer and was not represented, could have amounted to some sort of invitation to abandon the contract by agreement. On the contrary, the letter, as I have already observed, refers to continuing with the contract. Therefore, I put to one side the defendant's attempt in correspondence to characterise that letter as an invitation to the defendant to terminate the contract.

Balance of convenience and adequacy of damages

I turn then to the adequacy of damages. This application is for relief in equity in its auxiliary jurisdiction, to protect rights arising out of a contract. Therefore, I need to consider whether on the balance of convenience, damages would be an adequate remedy.
In the course of the hearing, I raised with counsel for the plaintiff that there is no evidence before me, or no sufficient evidence, to establish that damages could not be quantified and that those damages would not provide an adequate remedy to the plaintiff. I have not been given evidence, for example, that the absence of interlocutory relief would destroy the plaintiff company and thereby make damages futile. Quite the contrary, the evidence on behalf of the plaintiff suggests that the damages are readily quantifiable.
I accept that, in the absence of an injunction, the defendant withdrawing from the contract will create a significant burden for the plaintiff and that it will be extremely costly. However, in the circumstances, the significance of that burden is that if the plaintiff is correct and its position is upheld at trial, it will have a very significant damages claim against the defendant.
A further matter for me to consider is the fact that what I am asked to do is not merely restrain reliance upon the notice of termination, but as counsel for the plaintiff confirmed, I am asked to make mandatory orders requiring the defendant to utilise the plaintiff's services under the Kahu contract. In essence, the relief sought is in the nature of an interlocutory mandatory injunction.
I accept that the legal test is no different for the grant of a mandatory or a prohibitory injunction, but that the way that manifests in the balance of convenience may make a difference to the outcome. This, it appears to me, is a significant issue in these circumstances. What the court is asked to do today is to make an urgent decision based on the limited and preliminary information that has been provided because of the pending fire season that looms in Western Australia as the summer approaches.
It is plain that firefighting is an extremely stressful activity and those engaged in firefighting and those afflicted by it are in an extremely dangerous and precarious position. When significant equipment such as helicopters or other aerial devices are being used it seems to me plain that a cooperative relationship involving trust and confidence is required for the safety of those involved and the safety of the public. Fires have proven to be one of the most dangerous natural disasters in Australia and in summer, probably the greatest threat to life in this country.
For that reason, it seems to me that I should be extremely cautious on the basis of the preliminary materials before me in requiring the defendant to engage the plaintiff, and to conduct the firefighting using people with whom it says it no longer wishes to be in a relationship. The plaintiff says that the defendant's contentions about a breakdown in the relationship are not justified by the evidence and are now strategically or conveniently asserted. When one looks through the evidence, there is some possible force to what the plaintiff says in that regard. There is some undoubtedly robust exchange in communication between the parties, but one does not easily see an irreparable breakdown and outburst of hostility in the relationship.
I am not in a position to make a determination today about the extent, or genuineness, of the breakdown in relationship asserted by the defendant. Nevertheless, it does seem to me that it is not a matter in respect of which I can take any risk. That is, if I am satisfied that there is a cogent basis upon which it may well be found that there has been a breakdown in the relationship, and that there may well be a basis upon which the parties are unable to work cooperatively in this firefighting endeavour, then I should err on the side of caution.
The defendant's representatives have given sworn evidence that the relationship has broken down, and that the defendant cannot work with the plaintiff. That includes the sworn evidence of the defendant's Chief Pilot who is responsible for these operations. For that reason, it seems to me that the nature of the interlocutory relief sought in these particular circumstances militates against the grant of interlocutory relief.
I also raised with counsel for the plaintiff the concern expressed by the defendant about the adequacy of the undertaking on the basis that the plaintiff is a foreign company with no apparent assets in Australia or, indeed, no apparent assets anywhere because it has not provided evidence of its financial position. Counsel for the plaintiff helpfully advised me that the director, Mr Law, was prepared to give a personal undertaking. Had I been otherwise satisfied that urgent mandatory interlocutory relief was appropriate, that, I think, would likely have cured that particular difficulty.
However, for reasons I have explained in relation to the adequacy of damages and the nature and effect of the mandatory relief sought in very difficult circumstances, in my view, the best course is to leave the plaintiff to its remedy in damages. If the plaintiff is correct, it should be fully validated and compensated. Accordingly, I am not persuaded to grant the relief sought by the plaintiff.
The interlocutory application must therefore be dismissed.

Costs

Following my decision in relation to the application for injunctive relief, the parties disagreed on the appropriate costs order. I gave the parties the opportunity to file written submissions, which they did.
The defendant contended that an order for costs should be made in its favour, because the application was brought unreasonably. This was because the contract was a services contract, the injunction would have forced the parties to work together, and the plaintiff did not advance evidence that damages would be an inadequate remedy.
The plaintiff submitted that costs should be in the cause and explained its view that the application had not been brought unreasonably.
In Perdaman Chemicals and Fertilisers Pty Ltd v Griffin Coal Mining Company Pty Ltd [No 3], the Court of Appeal (Martin CJ, Newnes and Murphy JJA) said the following (with citations omitted):
It is the usual practice to order that the costs of an application for an interlocutory injunction be costs in the cause – that is to say, borne by the ultimate loser of the substantive proceedings. That is because the determination of the application does not involve the determination of substantive rights or obligations, but only the assessment of whether there is an arguable case for the relief sought, and where the balance of convenience lies. An application brought reasonable for the preservation of the status quo pending the final determination of the proceedings can usually be regarded as an incidental cost of those proceedings, borne by the ultimate loser. However, different considerations apply if the application is brought or opposed unreasonably, or in a manner which unreasonably inflated the costs of the application to the parties.[4]
[4] Perdaman Chemicals and Fertilisers Pty Ltd v Griffin Coal Mining Company Pty Ltd [No 3] [2011] WASCA 203 (S) [11].
More recently, the principles were explained at greater length, but fundamentally to the same effect, in RB (Hygiene Home) Australia Pty Ltd v Henkel Australia Pty Ltd (No 2).[5]
[5] RB (Hygiene Home) Australia Pty Ltd v Henkel Australia Pty Ltd (No 2) [2021] FCA 1194 [6] ‑ [16] (Halley J).
In my view, there is no sufficient basis in this matter to depart from the usual rule that costs should be in the cause. I do not consider that the application was unreasonably brought. I have determined that at least in some respects, the plaintiff has strong prospects of success. Matters relating to the personal services or relational aspect of the contract raised by the defendant were not obvious on the face of the documentary evidence and remain matters to be ventilated at trial. The adequacy of damages is always a matter for discretionary consideration among the various factors relating to the balance of convenience.
In the circumstances, I shall order that the costs of the plaintiff's application for interlocutory relief shall be in the cause, and that the defendant shall pay the plaintiff's costs associated with the defendant's application for costs, to be taxed if not agreed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
NW
Associate to Justice Solomon
24 NOVEMBER 2022