Kalibrate Asset Management Solutions Pty Ltd v; IBM Australia Limited (No 2)
[2018] VCC 414
•10 April 2018
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERCIAL DIVISION | Revised Not Restricted Suitable for Publication |
Case No. CI-16-04450
| KALIBRATE ASSET MANAGEMENT SOLUTIONS PTY LTD | Plaintiff |
| v | |
| IBM AUSTRALIA LIMITED | Defendant |
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JUDGE: | HIS HONOUR JUDGE COSGRAVE | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 6 April 2018 | |
DATE OF JUDGMENT: | 10 April 2018 | |
CASE MAY BE CITED AS: | Kalibrate Asset Management Solutions Pty Ltd v | |
MEDIUM NEUTRAL CITATION: | [2018] VCC 414 | |
REASONS FOR JUDGMENT
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Subject:COSTS
Catchwords: Application for indemnity costs – Whether special circumstances to justify departure from usual basis – Whether trial exceeded estimated duration due to time spent on unpleaded claims – Whether conduct breached overarching obligations under the Civil Procedure Act 2010
Legislation Cited: Civil Procedure Act 2010 (Vic)
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr T Barry | Isakow Lawyers |
| For the Defendant | Ms M Norton | Corrs Chambers Westgarth |
HIS HONOUR:
1 On 23 March 2018 I handed down reasons for judgment in this matter. At the conclusion of the judgment I indicated that, subject to hearing from the parties, I proposed to make orders that the plaintiff’s claim be dismissed and the plaintiff pay the defendant’s costs of the proceeding, such costs to be taxed on a standard basis in default of agreement. I directed that the parties file and serve any material relating to the proposed orders and adjourned the further hearing of the case until 6 April 2018.
2 The plaintiff filed an outline of submissions on 5 April 2018. The defendant filed an affidavit by Catherine O’Keefe sworn on 4 April 2018 and filed an outline of submissions the same day.
3 In its submissions, the defendant set out why it contended the court should order that the plaintiff pay the defendant indemnity costs in relation to:
· 1.5 days of the court hearing;
· the preparation of the aide memoire; and
· the review of the court book, including supplementary volumes, and the correspondence with the plaintiff’s solicitor concerning alleged anomalies in the court book.
4 The reference to the aide memoire was a reference to a document prepared by the defendant where it generated a table setting out each of the unpleaded claims raised by the plaintiff in its closing submissions, references to the relevant parts of the transcript, and the plaintiff’s written closing submissions. The table also contained columns allowing each party to state its position with respect to the claims made. The aide memoire was said to be necessary, or at least desirable, in dealing with the plaintiff’s attempt to introduce into its closing address claims which were not previously raised on the pleadings or during the trial. The defendant argued that its solicitors spent time preparing the document and should be recompensed for it.
5 In its outline of submissions, the plaintiff agreed that it should pay the defendant’s costs of preparing the aide memoire with such costs to be taxed on an indemnity basis in default of agreement.
6 When she began her address, Ms Norton on behalf of the defendant informed the court that the defendant no longer sought indemnity costs in respect of the alleged problems with the court book.
7 Thus, the only remaining issue for determination was whether the plaintiff should pay the defendant costs to be taxed on an indemnity basis for 1.5 days of the trial (or some lesser time) because of the delay in completing the trial and its prolongation beyond the trial duration which the parties advised the court.
8 The defendant pointed to the difference between the estimated time for final address, two hours for each party, and the actual time taken by the plaintiff, namely about two days. It was argued that a major reason for the increase in time was the time spent dealing with unpleaded claims and the fruitless claim based on the alleged representation made by the defendant, whether in the guise of misleading and deceptive conduct or estoppel. The defendant argued that pursuing matters not pleaded wasted time for all parties, increased costs and was contrary to the plaintiff’s obligations under the Civil Procedure Act 2010 (Vic).
9 The plaintiff argued that the court should distinguish between cases which, after a full trial, fail and those which were hopeless from the outset. It argued that, while the defendant might have lost the trial, its claims were not manifestly hopeless or brought for any improper purpose or motive. In any case, the plaintiff submitted that its pursuit of the unpleaded matters and the representation case did not cause 1.5 days’ delay in, or extension of, the trial. The plaintiff submitted that, at most, it was half a day.
10 The parties were in agreement that the court has a broad discretion as to costs and that special circumstances are required to justify an award of costs on an indemnity basis. The discretion is at large but must be exercised judicially. In the past, it has been recognised that an award of indemnity costs might be appropriate where a party’s conduct has caused a loss of time to the court or other parties, or a party has continued an action in circumstances where, properly advised, it should have known it had no chance of success. Whether or not a party complied with the requirements of the Civil Procedure Act might also be relevant.
11 In my view, the plaintiff’s conduct at the trial undoubtedly extended its duration longer than was necessary. Its attempt in closing submissions to run arguments which lacked a proper foundation in the amended statement of claim was unhelpful – it was a waste of both the parties’ time and the court’s time. The plaintiff’s own evidence regarding part of the representation claim was unsatisfactory and the plaintiff ought to have been advised that this aspect of the case would likely fail.
12 However, I am satisfied that while the conduct of the plaintiff’s case was unnecessarily long, complicated and at times confusing, it would be an exaggeration to say that the submissions regarding the unpleaded matters added 1.5 days to the trial duration. The representation case, apart from the question of damage flowing from the allegedly misleading and deceptive conduct, had to be examined in any event to assess the estoppel arguments.
13 Overall, making due allowance for the competing arguments and doing the best I can, I consider it appropriate that the plaintiff pay the defendant’s costs for two hours of court time on an indemnity basis. This is a reflection of the time spent on unpleaded matters, the time spent on repetitive and needlessly drawn out submissions and the inefficient or wasteful use of court time.
14 Accordingly, I make the following orders:
(a) the plaintiff’s claim is dismissed;
(b) the plaintiff pay the defendant’s costs for two hours of the trial, such costs to be taxed on an indemnity basis in default of agreement;
(c) subject to subparagraph (b) above, the plaintiff otherwise pay the defendant’s costs of the proceeding, including reserved costs, such costs to be taxed on a standard basis in default of agreement.
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