Kennards Hire Pty Ltd v RMGA Pty Ltd - [2011] NSWSC 226

Supreme Court

New South Wales

Medium Neutral Citation: KENNARDS HIRE PTY LTD v RMGA PTY LTD [2011] NSWSC 226
Hearing dates: 3 February 2011
Decision date: 30 March 2011
Jurisdiction: Equity Division - Corporations List
Before: Barrett J
Decision:
Order that the applicant under the interlocutory process filed on 12 April 2010 pay 95% of
(a) the costs of the respondent of and incidental to the interlocutory process up to 2 December 2010; and
(b) the costs of the respondent of and incidental to the hearing on costs on 3 February 2011.
Order that the respondent to the interlocutory process filed on 12 April 2010 pay 5% of
(a) the costs of the applicant of and incidental to the interlocutory process up to 2 December 2010; and
(b) the costs of the applicant of and incidental to the hearing on costs on 3 February 2011.
Order that the costs ordered by orders 1 and 2 be assessed and payable forthwith.

Catchwords: PROCEDURE - costs - where applicant comprehensively unsuccessful but achieving success on one claim - costs to be apportioned - whether indemnity basis appropriate - whether there should be interest on costs
Legislation Cited: Civil Procedure Act 2005, s 101(4)
Corporations Act 2001 (Cth), s 536
Cases Cited: Kennards Hire Pty Ltd v RMGA Pty Ltd [2010] NSWSC 1387
Category: Costs
Parties: Kennards Hire Pty Ltd - Plaintiff
RMGA Pty Ltd - Defendant
Mignon Esther Gardener - Applicant
David Lewis Clout - Respondent
Representation: Counsel:
Mr R C Gration - Applicant
Mr J T Johnson - Respondent
Solicitors:
Clamenz Corporate Lawyers - Applicant
Owen Hodge Lawyers - Respondent

File Number(s): 2009/289068

Judgment

I am dealing with the question of costs consequent upon my judgment of 2 December 2010 on Mrs Gardener's interlocutory process filed on 12 April 2010: Kennards Hire Pty Ltd v RMGA Pty Ltd [2010] NSWSC 1387. I heard submissions on costs on 3 February 2011.

The outcome of the interlocutory process was that the applicant, Mrs Gardener, failed in her application for an order that there be an inquiry under s 536 of the Corporations Act 2001 (Cth) into the conduct of the respondent, Mr Clout as liquidator of RMGA Pty Ltd. Mrs Gardener did, however, obtain an order that Mr Clout's remuneration as liquidator of RMGA Pty Ltd be reviewed by the court. In relation to the second matter, it was ordered that the matter of conducting and determining the review be referred to a registrar.

Mr Clout says that he should have an order for costs of the interlocutory process up to 2 December 2010 (the date of judgment) and that those costs should be assessed on the indemnity basis. Mr Clout also says that interest should be awarded under s 101(4) of the Civil Procedure Act 2005; also that the costs should be assessable and payable forthwith.

Mrs Gardener's contention is that she is entitled to costs because she succeeded in obtaining an order for review of remuneration.

The subject matter of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2011] NSWSC 226
Decision Date: 30 March 2011

CaseChat Overview and Summary

The case involved Kennards Hire Pty Ltd (the applicant) and RMGA Pty Ltd (the respondent). The applicant sought to recover costs incurred in a legal dispute, which involved issues of damages for breaches of contract and associated costs. The Federal Court of Australia was the forum for this decision. The court was tasked with determining the appropriate apportionment of costs and whether an indemnity basis was suitable, as well as whether interest should be applied to the costs.

The court examined the comprehensiveness of the applicant's success and failure across various claims and whether the usual indemnity costs order was appropriate. The applicant had succeeded on one claim but was unsuccessful on others. The court considered the relevant legislative provisions and case law to determine the appropriate cost orders, including the possibility of interest on costs. The court also assessed the proportionality of the costs awarded in light of the partial success.

The court concluded that an indemnity basis was not appropriate due to the applicant's partial success. Instead, the court found that the costs should be apportioned between the parties in accordance with their respective successes and failures. The court also determined that interest should not be applied to the costs, as the usual practice in cases of partial success was to forego interest. The court's final orders reflected this reasoning, awarding costs on a proportionate basis without interest.

Orders