| JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : LEUME PTY LTD -v- CHIANTI PTY LTD [2006] WADC 154 CORAM : EATON DCJ HEARD : 15 FEBRUARY 2006 DELIVERED : 28 SEPTEMBER 2006 FILE NO/S : CIV 91 of 2005 BETWEEN : LEUME PTY LTD Appellant
AND
CHIANTI PTY LTD
Respondent
Catchwords: Costs - Special order - Turns on own facts Legislation: District Courtof Western Australia Act 1969
Legal Practice Act 2003
Rules of the Supreme Court 1971 Result: Orders made
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Representation: Counsel:
Appellant : Mr R C Ioppolo
Respondent : Mr M J Feutrill
Solicitors:
Appellant : Wojtowicz Kelly
Respondent : Gibson & Gibson
Case(s) referred to in judgment(s):
Godden v Alford [1960] WAR 235
Case(s) also cited:
Nil
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1 EATON DCJ: On 30 June 2006 I handed down judgment in this matter which was an appeal from Registrar Kingsley of this Court. The background to the matter is that on 18 January 2005 the appellant filed a writ of summons with an endorsement of claim seeking the sum of $175,519 being payment by way of a distribution of trust income by the respondent as trustee of a trust. On 25 February 2005 the appellant filed a statement of claim. In due course the respondent filed a defence and counterclaim and the appellant filed a defence to the counterclaim. Both parties then sort further and better particulars and gave formal discovery.
2 On 15 April 2005 the respondent made application for security for costs and a stay of proceedings. On 31 May 2005 Registrar Hewitt dismissed that application. On 13 July 2005 the appellant filed an application for an extension of time within which to apply for summary judgment, for summary judgment on its claim and summary judgment on the counterclaim. That application was heard by Registrar Kingsley on 16 and 24 August 2005. On 9 November 2005 he dismissed the application delivering reasons for doing so. On 6 December 2005 he made orders that the writ be amended, that the statement of claim be amended, that the appellant had leave to apply for summary judgment out of time, that the application be otherwise dismissed and that costs be in the cause. 3 On 16 November 2005 the appellant gave notice of appeal from the judgment of Registrar Kingsley delivered on 9 November 2005. On 30 November 2005 that matter came before Registrar Hewitt who made orders granting an extension of time within which to bring the appeal, should such an extension be required, adjourning the matter for hearing before a Judge and reserving the question of costs. The matter was heard by me on 15 February 2006. 4 Following publication of my judgment on 30 June 2004 I made orders in the following terms: "(1) Paragraphs 4 and 5 of the order of Registrar Kingsley made on 6 December 2005 are hereby discharged. (2) There be final judgment for the plaintiff appellant against the defendant respondent in the sum of $175,519 plus interest thereon the rate of 6 per cent calculated from 18 January 2005 to 30 June 2005. (3) There be a stay of execution on the judgment in the previous paragraph conditional upon the defendant prosecuting its counterclaim without delay. (Page 4)
(4) The plaintiff have liberty to apply to revoke the stay of execution. (5) The appeal otherwise be dismissed. (6) The appellant's costs of the appeal and the defendant's costs of the action be adjourned sine die. (7) The respondent have seven days within which to file written submissions as to costs. (8) The appellant have seven days thereafter to file written submissions in response as to costs. (9) The matter otherwise stand adjourned pending resolution of the costs issue. (10) The defendant have leave to amend the counterclaim within 21 days. (11) The plaintiff have leave to amend the defence to counterclaim within 10 days thereafter." 5 On 7 July 2006 the respondent filed written submissions in relation to costs pursuant to those orders. On 17 July 2006 the appellant filed written submissions as to costs pursuant to those orders. 6 It is clear that, in accordance with those submissions, the respondent consents to an order that the appellant have the costs of the appeal, suggesting that an appropriate order would be as follows: "The defendant pay the costs of this appeal, including reserved costs, and the costs of the hearings before Registrar Kingsley on 16 and 24 August 2005, the costs to be taxed". 7 So far as the costs of the action are concerned the respondent submits that those costs should be reserved until final determination of the counterclaim suggesting that the appropriate order should be: "The costs of the plaintiff's action be reserved until the final determination of the defendant's counterclaim". 8 The appellant, noting consent to an order that the respondent pay the costs of the appeal including reserved costs and the costs of the hearings before Registrar Kingsley on 16 and 24 August 2005 to be taxed, has (Page 5)
suggested that the order should also include the costs of the application for summary judgment and that there be an order that, once taxed, the costs be paid forthwith. 9 The appellant seeks a further order pursuant to O 66 r 12(1) of the Rules of the Supreme Court 1971 effectively increasing the applicable costs scale limit by one third based on the sole ground that the hearing of the appeal on 15 February 2006 extended to approximately 6.12 pm. The precise terms of the orders sought by the appellant are as follows: "The limit of the allowance in item 22(d)/item 10(a) of the table of the Legal Practitioners (Supreme Court)(Contentious Business) Determination 2004 be increased to $11,527". 10 In response to that application the respondent submits that the duration of the hearing does not constitute a special circumstance such that a special costs order should be made. The respondent submits that there are no special circumstances to support such an order. The respondent submits that the Supreme Court scale adequately provides for the costs of the appeal, that scale being the Legal Practitioners (Supreme Court) (Contentious Business) Determination 2004, the District Court appeals scale being for the purpose of appeals to the District Court from the Magistrates Court or Strata Title Referee and the like. 11 As to the question of the costs of the action the appellant seeks the following order: "The defendant pay the plaintiff's costs of the action up to the date of this order, save for – (a) the costs of the defence to the count claim, and (b) the costs of the three requests relating to the counterclaim in the request for particulars of the defence and counterclaim dated 24 March 2005, the costs to be text and paid forthwith”. 12 Section 52 of the District Court of Western Australia Act 1969 provides that in all respects, except as expressly provided by or under that Act, practice and procedure of the Court as a court of civil jurisdiction shall be the same as the practice and procedure of the Supreme Court in like matters. Section 64 of that Act provides that the costs of any action or proceedings shall be in accordance with any legal costs determination (as defined by the Legal Practice Act 2003) and shall be paid by or (Page 6)
apportioned between the parties in such manner as the District Court Judge directs and in default of such direction shall abide the event. The section provides that, subject to the District Court of Western Australia Act, a District Court Judge has the same power in relation to the payment of costs by any party as a Judge of the Supreme Court. 13 Order 66, r 12 of the Rules of the Supreme Court provides that where a court is of the opinion that a special order as to costs should be made by reason of the unusual complexity or importance of the case or for any other good or sufficient reason the court may order that any particular allowances in any relevant scale be raised or a limit removed and in giving any such direction the court may fix a limit within which the taxing officer may allow such costs. 14 Section 215 of the Legal Practice Act 2003 relates to cost determinations in particular. It provides that the taxation of a bill of costs between parties is regulated by a legal costs determination. It provides further, however, that if a court is of the opinion that the amount of costs allowable in respect of a matter under a legal costs determination is inadequate because of the unusual difficulty, complexity or importance of the matter the Court may depart from the determination by ordering payment of costs above those fixed by the determination, by fixing higher limits, by removing limits or by making an order or giving any direction for the purpose of enabling costs above those in the determination to be ordered or taxed. 15 As already mentioned, the ground relied upon by the appellant is that the hearing of the appeal on 15 February 2006 extended to approximately 6.12 pm that night. There is, in my view, no necessary relationship between the duration of a hearing and the complexity, difficulty or importance of the matter being heard. In the absence of any submission to the effect that the matter being heard was of unusual difficulty, complexity or importance, I am inclined to refuse the application under O 66, r 12 and would do so if it were brought under s 215(2) of the Legal Practice Act 2003. The duration of the hearing does not, in my view, amount to a good or sufficient reason for the making of a special order. 16 Both parties appear to agree that the Legal Practitioners (Supreme Court) (Contentious Business) Determination 2004 is the applicable scale. That determination applies to remuneration of practitioners in respect of contentious business carried out by practitioners in or for the purposes of proceedings before the Supreme Court and the District Court other than contentious business to which the Legal Practitioner (District Court (Page 7)
Appeals) (Contentious Business) Determination 2002 or any successive determination of that scale applies. Subject to the provisions of that determination and the Legal Practice Act 2003 relating to solicitor and client agreements, the costs of and in relation to a party to an action or other proceeding (inclusive of GST and counsel fees, but exclusive of other disbursements) recoverable by one party from another or payable by a party to that party's own practitioner shall not exceed the amount set out in the table to that particular clause. The determination which may be cited as the Legal Practitioner’s District Court Appeals (Contentious Business) Determination 2004 deals with appeals to the District Court. I agree with the parties that the appropriate scale is the Legal Practitioners (Supreme Court) (Contentious Business) Determination 2004. 17 So far as the costs of the action are concerned there has, of course, been no trial. The appellant, in accordance with my judgment, has succeeded summarily on its O 14 application. The appellant failed to have the respondent's counterclaim disposed of summarily. Generally speaking if summary judgment is given for a plaintiff, the general rule is that the defendant is ordered to pay the costs of the action. I have given leave to the respondent to amend its counterclaim on the basis that there was, having regard to the content of the affidavit of Thomas Lindsay Ryan sworn 12 May 2005, some suggestion that there had been, as between the parties, an arrangement in place which might afford the basis of an arguable counterclaim. In effect, I was affording the respondent the opportunity of developing that claim by amendment of the existing pleadings. In those circumstances, I am of the view that the appellant should have the costs of the action to this point. 18 The respondent relies upon Godden v Alford[1960] WAR 235. That was a case arising out of a motor vehicle accident at an intersection. The appellant was the driver of one of the two vehicles and the respondent was the driver of the other. At trial the respondent was held to have been more culpable than the appellant, such that there was an apportionment between the two, three quarters against the respondent and one quarter against the appellant. On the question of costs Hale J in the Full Court said that where a claim and a counterclaim raise essentially different issues, separate orders for costs should be made unless the issues are very much interlocked when the Court should consider whether a special order should be made. More importantly he said (at p 237): "The guiding principle, and in fact the only rule which can be justly be called a principle, is that the court should carefully examine the realities of the case in hand, and should so frame its (Page 8)
order that justice shall, so far as costs are concerned, be nearly as possible done between the parties”. 19 The situation in the matter before me is far from analogous to that of a motor vehicle accident at an intersection where the parties are the respective drivers each alleging the other to be at fault. In the matter before me, the claim by the appellant against the respondent was effectively based on the legal relationship between the parties, created by the respective trust deeds and the accounting documents associated with the trusts created in accordance with those deeds. Depending upon the development of the counterclaim in terms of amended pleading, I expect that, that in all probability, the relief sought on counterclaim will be based upon a factual scenario entirely different to that which supported the claim, arising primarily from the relationships between those individuals involved in the creation and conduct of the respective trusts, both in familial and general terms. It is the case that if the counterclaim does ultimately succeed, it may render the judgment now obtained summarily by the plaintiff appellant nugatory. That remains to be seen. 20 Having regard to the foregoing, it is my view that it is not appropriate to reserve the costs of the action until final determination of the counterclaim. To the contrary, having regard to the way in which the matter has been pleaded thus far, it is appropriate that the appellant have its costs of the claim as opposed to those relating to the counterclaim. I do agree with the appellant's submission at par 14 of its written submissions to the effect that the appellant should have all costs incurred with respect to the issue of the writ, the issue of the statement of claim, the issue of request for particulars of defence and counterclaim, successfully opposing the application for security for costs, discovery and inspection by both parties, the various directions hearings, the application for summary judgment and the appeal against the dismissal of the application for summary judgment. I do therefore agree that there should be an order that the respondent pay the appellant's costs of its claim up to the date of summary judgment including the costs of appeal and those already mentioned above, those costs to be taxed. The appellant's costs of the counterclaim will be reserved. 21 Although I thought it appropriate to stay execution of the summary judgment obtained by the appellant, I do not consider that there should be a stay in relation to the appellant's taxed costs. That is because, in my opinion, the respondent's counterclaim is yet to be fully and cogently pleaded. The appellant should not have to wait upon its costs in the (Page 9)
expectation that that will occur or that it will occur expeditiously. There will, therefore, be orders that: 1. The respondent pay the appellant's costs of the application for summary judgment, the costs of this appeal, including reserved costs and the costs of the hearings before Registrar Kingsley on 16 and 24 August 2005 to be taxed. 2. The respondent pay the appellant's costs of the claim up to the date of judgment and the costs associated with my determination on the issue of costs to be taxed. 3. The appellant's costs of the O 16 summary judgment application will be reserved.
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