Kitanovski v Ibrahim (No 2) - [2022] NSWSC 1371

Supreme Court

New South Wales

Medium Neutral Citation: Kitanovski v Ibrahim (No 2) [2022] NSWSC 1371
Hearing dates: On the papers
Date of orders: 12 October 2022
Decision date: 12 October 2022
Jurisdiction: Equity
Before: Darke J
Decision:
Second defendant to pay costs of plaintiff in relation to plaintiff’s claim for specific performance. Plaintiff to pay first and third defendants’ costs in relation to plaintiff’s claims for removal of caveats.

Catchwords:
COSTS – departure from usual rule – plaintiff a purchaser under a contract for sale with second defendant vendor – sale at a price below market value – plaintiff seeks orders for removal of caveats – plaintiff successful, but only after belatedly offering to pay money into Court to serve as alternative security for caveators – held appropriate that plaintiff pay costs of caveators – held not appropriate to order second defendant to pay those costs – second defendant not responsible for sale being at an undervalue and it was doubtful that she had ability to herself have caveats removed

Legislation Cited:
Real Property Act 1900 (NSW), s 74MA

Cases Cited:
Kitanovski v Ibrahim [2022] NSWSC 1232
Northern Territory v Sangare (2019) 265 CLR 164; [2019] HCA 25
Oshlack v Richmond River Council (1998) 193 CLR 72
Redden v Chapman (1949) 50 SR (NSW) 24

Category: Costs
Parties: Mary Kitanovski (Plaintiff)
Fadi Ibrahim (First Defendant)
Jamelie Josephine Joan Lahood (Second Defendant)
Commissioner of Taxation (Third Defendant)
Representation:
Counsel:
Mr D W Robertson (Plaintiff)
Mr P Horobin (First Defendant)
Mr M J Smith (Third Defendant)
Solicitors:
Holding Redlich (Plaintiff)
Concordia Legal (First Defendant)
Craddock Murray Neumann Lawyers (Third Defendant)

File Number(s): 2021/30820
Publication restriction: None

Judgment

I delivered judgment in this matter on 14 September 2022 (see Kitanovski v Ibrahim [2022] NSWSC 1232). In accordance with the Amended Summons filed on 13 August 2021, the Court made an order for specific performance of a contract for the sale of land entered into between the plaintiff (Ms Kitanovski) as purchaser and the second defendant (Ms Lahood) as vendor. The Court also ordered the first defendant (Mr Ibrahim) and the third defendant (the Commissioner of Taxation) to remove their respective caveats over the property, on the condition that Ms Kitanovski pay into Court the sum of $700,000 (being the difference between the contract price and the true value of the land) as a form of alternative security.
The only matter still to be determined is who should bear the costs of the proceedings. At [55] of the primary judgment, I indicated that my preliminary view on the matter was that Ms Lahood ought to pay Ms Kitanovski’s costs of the specific performance claim, but that Ms Kitanovski should pay Mr Ibrahim’s and the Commissioner’s costs of the proceedings insofar as they related to Ms Kitanovski’s attempts to have their caveats removed pursuant to section 74MA of the Real Property Act 1900 (NSW). This preliminary view was buttressed, but not entirely formed, by the fact that counsel for Ms Kitanovski only…

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.

Continue reading Kitanovski v Ibrahim (No 2)

Details

AGLC: Kitanovski v Ibrahim (No 2) [2022] NSWSC 1371
Case: [2022] NSWSC 1371
Decision Date: 12 October 2022

CaseChat Overview and Summary

In Kitanovski v Ibrahim (No 2), the plaintiff sought orders to remove a caveat from a property. The defendant was the vendor of the property, and the second defendant was the person who had lodged the caveat. The dispute arose from a contract for the sale of the property, where the sale price was significantly below market value. The plaintiff, who had already purchased the property, sought to remove the caveat in order to finalise the transaction. The plaintiff was successful in their application to remove the caveat, but only after offering to pay money into court to serve as alternative security for the caveators.

The court had to determine whether it was appropriate to order the second defendant to pay the costs of the caveators. The plaintiff argued that the second defendant was responsible for the costs, as she was the one who lodged the caveat. However, the court held that the second defendant was not responsible for the sale being at an undervalue, and it was doubtful that she had the ability to herself have the caveats removed. The court held that it was appropriate to order the plaintiff to pay the costs of the caveators, as the plaintiff was the one who had benefitted from the removal of the caveat.

In summary, the court held that it was appropriate for the plaintiff to pay the costs of the caveators, but not appropriate to order the second defendant to pay those costs. The second defendant was not responsible for the sale being at an undervalue, and it was doubtful that she had the ability to herself have the caveats removed. The court's decision highlights the importance of considering the individual circumstances of each case when determining who should bear the costs of litigation.

Orders