Leasi v Fono

[2018] NSWSC 1280

Supreme Court

New South Wales

Medium Neutral Citation:	Leasi v Fono [2018] NSWSC 1280
Hearing dates:	On the papers
Date of orders:	17 August 2018
Decision date:	17 August 2018
Jurisdiction:	Equity
Before:	Darke J
Decision:	Order made that each party bear their own costs of the proceedings.
Catchwords:	COSTS – proceedings between co-owners of property – application for appointment of trustee for sale – proceedings settled save as to costs – failure to reach agreement prior to proceedings not result of unreasonable conduct – much of evidence in support of application unnecessary – appropriate to order each party to bear own costs
Legislation Cited:	Civil Procedure Act 2005 (NSW), s 98 Conveyancing Act 1919 (NSW), s 66G
Cases Cited:	Kardos v Sarbutt (No 2) [2006] NSWCA 206
Category:	Costs
Parties:	Peter John Leasi (First Plaintiff) Nada Leasi (Second Plaintiff) Salu Fono (First Defendant) Mavae Fono (Second Defendant)
Representation:	Counsel: Mr M Hadley (Defendants)   Solicitors: Betar Lawyers (Plaintiffs) ECK Lawyers (Defendants)
File Number(s):	2018/143202
Publication restriction:	None

Judgment

1. By a Summons filed on 7 May 2018 the plaintiffs sought the appointment of a trustee for the sale of certain land at 27 Colson Crescent, Werrington County, pursuant to s 66G of the Conveyancing Act 1919 (NSW). The plaintiffs and the defendants are registered co-owners of the property. On 6 July 2018 the Court was informed that the matter had settled, save as to costs. It appears that the parties have agreed to jointly appoint a trustee for the sale of the property. It was resolved that the question of costs would be dealt with on the papers, and the parties have provided written submissions to that end.

2. The plaintiffs seek an order that their costs be paid out of the defendants’ share of the property, on the indemnity basis. In support of this position the plaintiffs submit that the defendants unreasonably withheld their consent to the sale of the property, effectively forcing the plaintiffs to institute these proceedings.

3. The defendants seek an order that each party bear their own costs. The defendants submit that the plaintiffs’ costs of commencing the proceedings should not come from the net proceeds of sale because the plaintiffs failed to negotiate to put the property on the market before commencing proceedings, and because the proceedings were conducted wastefully.

4. It appears that in August 2017 the first defendants expressed an interest in buying the plaintiffs’ interest in the property. The plaintiffs’ solicitor sent a response on 23 August 2017. It was suggested that valuations be obtained in order to reach an acceptable price. The defendants responded on 8 September 2017, indicating that they were open to such an agreement. It appears that the defendants later made an offer to the plaintiffs which the plaintiffs considered to be unacceptable. On 21 November 2017 the plaintiffs made an offer to the defendants, and threatened to commence proceedings without further notice if their offer was not accepted by 30 November 2017. The offer was not accepted, and these proceedings were commenced approximately five months later.

5. As to the conduct of the proceedings, the defendants submit that the first plaintiff’s affidavit, sworn on 7 May 2018, contained “a large quantity of insulting and irrelevant evidence”. The evidence in question was almost entirely devoted to a detailed account of the breakdown in the relationship between the plaintiffs and the defendants. The affidavit ran to 18 pages, not including annexures.

6. In my opinion, in circumstances where the parties could not agree on a suitable regime for the sale of the property, it was necessary for the parties to approach the Court (see Kardos v Sarbutt (No 2) [2006] NSWCA 206 at [29]). I do not think there is anything to indicate that either party acted unreasonably in failing to come to such an agreement. The usual order for costs in such circumstances is that each party’s costs are to come out of the net proceeds of sale (Kardos v Sarbutt (No 2) (supra) at [28]).

7. However, I do not think the defendants should be made to bear the costs of the preparation of the plaintiffs’ evidence, which consisted solely of the first plaintiff’s affidavit. Given that the Summons sought only the appointment of a trustee for sale of the property, and did not seek any adjustments in the plaintiffs’ favour upon sale, it was not necessary to provide a lengthy and detailed account of the circumstances of the plaintiffs’ falling out with the defendants. I am satisfied that the costs associated with the preparation of this evidence were unnecessary and unreasonable.

8. In these circumstances, it is my opinion that the appropriate order to make for costs, in the exercise of the discretion under s 98 of the Civil Procedure Act 2005 (NSW), is that each party bear their own costs of the proceedings.

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Decision last updated: 17 August 2018