Kosovich v Despot

[2014] FCCA 2608

FEDERAL CIRCUIT COURT OF AUSTRALIA

KOSOVICH v DESPOT [2014] FCCA 2608

Catchwords:
COSTS – Application for costs – application dismissed.

Applicant: MATE KOSOVICH

Respondent: RANKO DESPOT

File Number: SYG 370 of 2013

Judgment of: Judge Manousaridis

Hearing date: 8 October 2014

Delivered at: Sydney

Delivered on: 12 November 2014

REPRESENTATION

Solicitors for the Applicant:

Mr J Merewether

Merewether & Co Solicitors

Counsel for the Respondent: Mr J C Hewitt

Solicitors for the Respondent: Pamela J Enright Solicitor

ORDER (made on 8 October 2014)

1. The respondent’s application for costs of the hearing on 21 May 2014 is dismissed.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 370 of 2013

MATE KOSOVICH

Applicant

And

RANKO DESPOT

Respondent

REASONS FOR JUDGMENT

1. On 8 October 2014 I ordered that the respondent’s application for costs of the hearing of 21 May 2014 be dismissed. I indicated to the parties that I would publish my reasons later. These are my reasons.

2. The respondent applied for an order that the applicant and supporting creditor pay the respondent’s costs of and incidental to the hearing of 21 May 2014. On that day, I ordered, among other things, that the hearing of the creditor’s petition be stayed pending the determination of the proceedings in the Supreme Court of New South Wales, being Proceedings No 2009/298869.

3. I made the order pursuant to an interim application the respondent filed on 6 May 2014. In that application, the respondent sought an order that the hearing of the creditor’s petition be stayed pending the determination of the notice of motion filed 6 May 2014 in NSW Supreme Court Proceedings No 2009/298869.

4. The interim application was supported by an affidavit made by the respondent’s solicitor, Ms Enright, sworn on 6 May 2014. Ms Enright annexed to her affidavit a notice of motion that Ms Enright said was “to be filed on or about 6 May 2014”. Ms Enright deposed that the notice of motion “seeks orders which would restore Mr Despot on the record as registered proprietor with respect to Unit 7/539 New South Head Road Double Bay being Lots 7, 24 and 25 in Strata Plan 4542”. The draft notice of motion named eight defendants, none of whom was the applicant or the supporting creditor.

5. The interim application was referred to me on 12 May 2014. I directed that by 16 May 2014 the respondent file evidence on which he relies for the adjournment or stay of the creditor’s petition, and that the applicant file affidavits in response.

6. Pursuant to those directions, on 15 May 2014 the applicant filed a further affidavit sworn by Ms Enright. The affidavit presents detailed background to the notice of motion the respondent had filed in the Supreme Court, and the grounds on which the respondent was seeking the orders claimed in the notice of motion. The affidavit consisted of 43 paragraphs and 41 documents.

7. On 20 May 2014, the respondent filed a further affidavit, this time annexing the transcript of a hearing that took place before His Honour Justice Hammerschlag of the Supreme Court of New South Wales on 16 May 2014. His Honour directed that the transcript of the hearing before his Honour be made available in these proceedings. His Honour set down the motion for hearing on 7 and 8 July 2014.

8. On 20 May 2014, the applicant’s solicitor wrote to the respondent as follows:

   [W]e refer to the listing of this matter tomorrow 21 May 2014 and advise that having considered now the further material provided by your offices along with the annexures thereon we are of the respectful view that perhaps the best course of action for this matter would be to have the matter adjourned to a later date. We understand that in respect of the Notice of Motion before the Supreme Court of New South Wales various Orders were made and a date set some time in July for the determination of that Motion.

   We propose that this matter be adjourned to a date at least a week or two (2) after the listing date of the Motion particulars of which we are not aware of.

   We have instructed our Agent to seek Orders accordingly with an additional Order allowing the parties liberty to restore the matter to the list if necessary.

9. As I note above, on 21 May 2014, I made an order by consent adjourning or staying the creditor’s petition pending the determination of the respondent’s notice of motion in the Supreme Court of New South Wales.

10. The respondent submits that the applicant and the supporting creditor should pay the respondent’s costs of the hearing of 21 May 2014 because the applicant had earlier alleged the notice of motion that was filed in the Supreme Court was an abuse of process, and that the applicant had subsequently withdrawn that allegation. The respondent submits that because of the abuse of process allegation, the respondent was forced to prepare evidence and to prepare for the hearing on 21 May 2014 to rebut the allegation of abuse of process.

11. The applicant, on the other hand, submits that the respondent did not provide sufficient information to enable the applicants to make a reasoned decision on whether to contest the orders for a stay sought in the interim application until the afternoon of 15 May 2014, when the respondent filed the affidavit of Ms Enright, and that it was not unreasonable for the applicant to not be in a position to decide on the course it should take in relation to the notice of motion until 20 May 2014.

12. In my opinion, the respondent is not entitled to the costs of the hearing of 21 May 2014. The respondent incorrectly characterises the preparation of Ms Enright’s affidavit of 15 May 2014, and indeed the hearing itself, as something he was required to do because of the allegation of abuse of process. The material in Ms Enright’s affidavit was material the respondent ought to have filed at the time he filed the interim application. Had the respondent not filed Ms Enright’s affidavit of 15 May 2014, not only would the applicant probably not have consented to the stay I ordered on 21 May 2014; the application would in all likelihood not have obtained the stay in the first place for want of evidence.

13. The applicant did not act unreasonably by insisting the respondent provide details of the grounds on which the respondent sought the relief he claimed in the notice of motion he filed in the Supreme Court proceedings. And the applicant did not take an unreasonable time to review the affidavit of Ms Enright and consider whether to oppose the application for a stay.

14. It is for these reasons that on 8 October 2014 I dismissed the respondent’s application for an order that the applicant and supporting creditor pay the respondent’s costs of the hearing of 21 May 2014.

I certify that the preceding fourteen (14) paragraphs are a true copy of the reasons for judgment of Judge Manousaridis

Associate: 

Date: 12 November 2014