Lewis v Doran

[2008] NSWSC 186

CITATION:	Alan Edward Lewis v Paul Adrian Doran [2008] NSWSC 186
HEARING DATE(S):	12 & 13 February 2008
JUDGMENT OF:	Hammerschlag J
EX TEMPORE JUDGMENT DATE:	13 February 2008
DECISION:	Declaration refused. Orders for the payment of interest on costs
CATCHWORDS:	COSTS – Costs order – Time and effort expended by party locating, inspecting, collating and analysing documents for the purpose of preparing affidavits and giving evidence – Whether such costs are “legal costs” within the meaning of s 4(1) of the Legal Profession Act 2004 (NSW) (the Act) and susceptible to assessment pursuant to s 364 of the Act – If not, whether they are “costs” within the meaning of s 302 and 367A of the Act – Such costs not “legal costs” because not “disbursements” because not charged or potentially charged for or subject of a liability to a law practice – Time spent by litigant preparing and conducting his own case not “costs” unless witness expenses – Whether declaratory relief appropriate where assessment not yet commenced and where statutory appeal available
LEGISLATION CITED:	Corporations Act 2001 (Cth) Legal Profession Act 2004 (NSW) Supreme Court Act 1970 (NSW) Civil Procedure Act 2005 (NSW) Supreme Court Rules 1970 (NSW)
CASES CITED:	Lewis v Doran (2004) 50 ACSR 175 Lewis (as liquidator of Doran Constructions Pty Ltd (in liq)) v Doran (2005) 54 ACSR 410 Ricky Gardner v R [2003] NSWCCA 199 Re Felton (1942) 60 WN(NSW) 16; Ly v Jenkins (2001) 114 FCR 237 Damberg v Damberg (2001) 52 NSWLR 492 Cachia v Hanes (1994) 179 CLR 403 Re Remnant (1849) 50 ER 949 Barwick v Barwick & Hinks (1937) 33 Tas LR 1 Kerridge v Foley (unreported SCNSW 19.08.70) Lawrence v MD Nikolaidis & Co (2003) 57 NSWLR 355 Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355 Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 Wilkie v Gordian Runoff Ltd (2005) 221 CLR 522 Maronis Holdings Ltd v Nippon Credit Australia Pty Limited [2002] NSWSC 838 Commonwealth Bank of Australia v Hattersley (2001) 51 NSWLR 333 Currabubula v State Bank of New South Wales [2000] NSWSC 23 Lahoud v Lahoud [2006] NSWSC 126
PARTIES:	Alan Edward Lewis (As liquidator of Doran Constructions Pty Limited (in Liquidation) ACN 001 439 185 Doran Constructions Pty Limited (in Liquidation) ACN 001 439 185 Paul Adrian Doran Peter Joseph Doran Michael John Doran John Cerriti Doran Doran Holdings Pty Limited ACN 000 383 782 Doran Constructions (Australia) Pty Limited (in Liquidation) ACN 005 438 728
FILE NUMBER(S):	SC 4406/2000
COUNSEL:	C.D. Freeman (First Plaintiff) A.S. Martin SC with S.A. Wells (First to Fifth Defendants)
SOLICITORS:	Walker Insolvency Lawyers (First Plaintiff) Christopher C Freeman & Co (First to Fifth Defendants)

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IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
CORPORATIONS LIST

HAMMERSCHLAG J

13 FEBRUARY 2008

4406/2000 ALAN EDWARD LEWIS –V- PAUL ADRIAN DORAN

EX TEMPORE JUDGMENT

Factual background

1 HIS HONOUR: The first plaintiff liquidator and the second plaintiff building company (“the Company”) brought proceedings in this Court making various claims against the directors of the Company and another company with the same directors.

2 The proceedings were heard by Palmer J between 8 and 12 March 2004 and His Honour gave judgment on 9 July 2004: see Lewis v Doran (2004) 50 ACSR 175.

3 As the headnote to the decision states, the claims involved establishing that the Company was insolvent at a particular point in time under the definition of insolvency in s 95A of the Corporations Act 2001 (Cth). The critical date was that of a debt restructuring effected on 1 November 1994.

4 On 6 August 2004, his Honour formally dismissed the plaintiffs’ amended originating process and his Honour ordered the plaintiffs to pay the defendants’ costs of the proceedings on a party/party basis.

5 The plaintiffs appealed. Their appeal was dismissed, with costs, by the Court of Appeal on 18 August 2005: see Lewis (as liquidator of Doran Constructions Pty Ltd (in liq)) v Doran (2005) 54 ACSR 410.

6 The plaintiffs sought special leave to appeal from the High Court which leave was refused on 10 February 2006 and the plaintiffs were, once more, ordered to pay the defendants’ costs.

7 Mr Paul Adrian Doran (“Mr Doran”) was the first defendant in the proceedings and at all material times a director of the Company and of the fifth defendant Doran Holdings Pty Ltd, and the sixth defendant Doran Constructions (Australia) Pty Ltd (in liquidation).

8 Mr Peter Joseph Doran was the second defendant, Mr Michael John Doran the third and Mr John Cerriti Doran the fourth defendant in the proceedings.

9 The proceedings were preceded by public examinations conducted on behalf of the liquidator from 23 to 25 March 1999. Prior to that, the directors of the Company produced some 250 boxes of documents in response to summonses issued at the liquidator’s instance.

10 In an affidavit sworn on 10 August 2007 Mr Doran chronicles the time and effort devoted by him for his benefit and the benefit of the other defendants in meeting (ultimately successfully) the plaintiffs’ claims.

11 A significant issue in the proceedings was what debts were due and payable by the Company as at 1 November 1994 (and other relevant dates) which in turn involved determining the liability of the Company to pay retention sums which it held against the performance by its sub-contractors.

12 Amongst other reasons, because the Company’s records had been handed over under the summonses earlier referred to, significant difficulty was encountered by the defendants in investigating and determining what debts were truly due and payable as at 1 November 1994, and if so, the amount of each debt.

13 The defendants no longer had in their possession the documents which could have assisted them in their task of determining the Company’s true financial position at the critical time.

14 Mr Doran, according to the unchallenged evidence before me, was the only person who had sufficient knowledge and understanding of the accounting system and records of the Company and the documents maintained by it, to be able to determine critical matters from which its financial position, and therefore its solvency, could be ascertained as at the relevant date.

15 In an interlocutory skirmish before Gzell J the parties argued that those on the opposing side of the record should bear the burden of inspecting the documents. On 23 July 2003 his Honour concluded that the necessity of the defendants to have access to the primary records arose from the fact that the financial reports of the defendants at the relevant time did not properly reveal the Company’s solvency because trade creditors wrongly included sub-contractors’ retention monies and debts not due for payment until a later time.

16 His Honour’s view was that since the primary source of the documents “were in the possession of the defendants before being handed over to the first plaintiff, the former officers of the defendants [sic]” were in the best position to identify the documents from the discovery.

17 Difficulties were encountered by the defendants in obtaining access to the documents.

18 The process of inspecting the documents involved Mr Doran locating the actual invoices rendered by individual creditors of the Company from boxes of documents made available by the plaintiffs. This was a very time consuming process brought about, according to Mr Doran, because the plaintiffs were unable to identify what boxes contained which documents, and in addition, the documents were in a state of disarray in the boxes.

19 Mr Doran swore an affidavit dated 30 October 2003 which was read in the proceedings. The affidavit was in evidence before me. It runs to some 65 pages and makes reference to numerous documents.

20 His unchallenged evidence before me was that the task of preparing and completing the affidavit was made “greatly more difficult and time consuming as a result of the problems incurred in the discovery and inspection process of the plaintiffs’ discovered documents”.

21 Mr Doran received advice from Senior Counsel as to points to be covered in his affidavit.

22 He compiled issues files which formed the basis of the affidavit of which there were 53 in total and he spent 1,602 hours doing it. He spent considerable time gathering information over a number of years.

23 Also, in some of his tasks he had the assistance of two members of his staff (two secretaries) and he oversaw their activities.

24 He spent many hours with PricewaterhouseCoopers and his legal advisors and he estimates that he spent 600 hours from May 2003 to October 2003 preparing his affidavit. He spent 71 hours preparing for, and attending, the hearing before Palmer J.

25 The first to fifth defendants have prepared an itemised bill of costs for the proceedings before Palmer J, the Court of Appeal and the High Court but have not yet lodged an application for assessment.

These proceedings

26 By Interlocutory Process dated 22 August 2007 the first to fifth defendants, (to whom I shall henceforth refer to as “the defendants”), seek a declaration that the assessment of their costs, for which the liquidator is liable, by a costs assessor pursuant to s 364 of the Legal Profession Act 2004 (NSW) should include a reasonable hourly rate (determined by the costs assessor) for the time spent by Mr Doran and staff in:

(a) locating, inspecting, collating and analysing documents for the purpose of preparing his affidavits;
(b) locating, inspecting, collating and analysing documents for the purpose of qualifying the first to fifth defendants’ experts, Messer Hunter & Bryant, to give evidence in defence of the claim;
(c) preparing his affidavits;
(d) attending conferences with solicitors and/or counsel for the purposes of (a) – (c), above;
(e) attending at the hearing.

27 During the course of the hearing before me and after counsel for the liquidator had made submissions, the defendants moved to amend the Interlocutory Process by including an alternative declaration in the following terms:

“1A Alternatively to paragraph 1, above, a declaration that as part of the assessment of costs by a costs assessor pursuant to s 367A of the Legal Profession Act 2004 (NSW) the reasonable value of the time spent by the first defendant in preparing his affidavit evidence, in preparing to give oral evidence and in attending court at the hearing is capable of falling within the meaning of the terms ‘costs’ as defined by s 302(1) of the Legal Profession Act 2004 (NSW).”

28 The amendment was opposed on the basis that it was futile. I refused it. I said I would give reasons and they appear below.

29 In addition, the defendants seek an order that the liquidator pay interest on costs and disbursements actually paid by them in the proceedings and in the Court of Appeal from the date they paid them until the liquidator pays them or until further order of the Court.

30 The Company has since been deregistered and relief is sought only against the liquidator.

31 The sixth defendant has filed a submitting appearance.

32 I will deal with the two claims in turn. It is necessary first, however, to set out the relevant statutory provisions.

The relevant statutory provisions

33 Section 76(1) of the Supreme Court Act 1970 (NSW) prior to its repeal on 15 August 2005 provided as follows:

“(1) Subject to this Act and the rules and subject to any other Act -
(a) costs shall be in the discretion of the Court;
(b) the Court shall have full power to determine by whom and to what extent costs are to be paid; and
(c) the Court may order costs to be assessed on the basis set out in Division 6 of Part II of the Legal Profession Act 1987 or on an indemnity basis.”

34 Section 76(2) of the Supreme Court Act provided as follows:

“(2) in subsection (1) the expression costs includes -
(a) costs of or incidental to proceedings in the Court, including the administration of estates and trusts;
(b) in the case of an appeal to the Court, the costs of or incidental to the proceedings giving rise to the appeal, as well as the costs of or incidental to the appeal; and
(c) in the case of proceedings transferred to or removed into the Court, the costs of or incidental to the whole proceedings, both before and after the transfer or removal.”

35 Those provisions were replaced by s 98 of the Civil Procedure Act2005 (NSW) in terms which, for the purposes of these proceedings, are relevantly indistinguishable in their operation.

36 Section 364 of the Legal Profession Act 2004 (NSW) (“the Act”) provides:

Assessment of costs - costs ordered by court or tribunal
(1) In conducting an assessment of legal costs payable as a result of an order made by a court or tribunal, the costs assessor must consider:
(a) whether or not it was reasonable to carry out the work to which the costs relate, and
(b) whether or not the work was carried out in a reasonable manner, and
(c) what is a fair and reasonable amount of costs for the work concerned.
(2) In considering what is a fair and reasonable amount of legal costs, a costs assessor may have regard to any or all of the following matters:
(a) the skill, labour and responsibility displayed on the part of the Australian legal practitioner or Australian-registered foreign lawyer responsible for the matter,
(b) the complexity, novelty or difficulty of the matter,
(c) the quality of the work done and whether the level of expertise was appropriate to the nature of the work done,
(d) the place where and circumstances in which the legal services were provided,
(e) the time within which the work was required to be done,
(f) the outcome of the matter.
(3) An assessment must be made in accordance with the operation of the rules of the relevant court or tribunal that made the order for costs and any relevant regulations.
(4) If a court or a tribunal has ordered that costs are to be assessed on an indemnity basis, the costs assessor must assess the costs on that basis, having regard to any relevant rules of the court or tribunal and relevant regulations.

37 The term “legal costs” is defined in s 4(1) of the Act to mean:

“amounts that a person has been or may be charged by, or is or may become liable to pay to, a law practice for the provision of legal services including disbursements but not including interest.”

38 The term “legal services” is defined in s 4(1) of the Act to mean:

“work done, or business transacted, in the ordinary course of legal practice.”

39 Relevantly, “law practice” is defined to include an Australian legal practitioner. There is no issue that the defendants’ solicitor Mr Freeman (to be distinguished from Mr C D Freeman of counsel who appeared for the liquidator) qualifies as a law practice.

40 Section 302 of the Act contains a definition of “costs” for the purposes of Pt 3.2 which is headed “Costs disclosure and assessment”, in the following terms:

“Costs includes fees, charges, disbursements, expenses and remuneration.”

41 Section 367A of the Act is in the following terms:

Determinations of costs assessments for party/party costs

A costs assessor is to determine an application for an assessment of costs payable as a result of an order made by a court or tribunal by making a determination of the fair and reasonable amount of those costs.

42 Part 3.2 of the Act commences with s 301 and ends with s 400. The definition in s 302 accordingly applies to s 367A.

43 Subdivision 6 of Pt 3.2 contains provisions dealing with appeals by a party to an application for a costs assessment who is dissatisfied with the decision of a costs assessor as to a matter of law arising in the proceedings to determine the application and affords that party a right of appeal in accordance with the rules of this Court against the decision.

The assessment of costs issue

44 It was made clear by Mr A S Martin of senior counsel who together with Mr S Wells appeared for the defendants that the Court was not being asked (and I should say it would not have if it had been asked) to find as a fact that any or all of the activities of Mr Doran described in his affidavit actually occurred, or to consider how an assessment of the costs attributable to those activities, if they did occur, should be carried out.

45 This meant, and so much was accepted by the defendants, that what was being sought was not a declaration in the terms prayed for but one to the effect that the activities enumerated in the principal declaration sought were capable of falling within the term “disbursements” within the definition of “legal costs” in s 4(1) of the Act.

46 The basic proposition put was that the value of the time spent by Mr Doran (at a reasonable hourly rate) in preparing his affidavit evidence, preparing to give oral evidence and attending Court to give oral evidence and to give instructions as the hearing progressed, was capable of falling within the meaning of “disbursements” of s 4(1) of the Act.

47 The principal thrust of the defendants’ submission was that:

a the words in the definition of legal costs “including disbursements” were intended as words to enlarge the ordinary meaning of the words they qualify: Ricky Gardner v R [2003] NSWCCA 199, and that the word disbursements is unqualified and stands alone in the section;

b ordinarily witness expenses incurred by a party (represented or unrepresented), which may include qualifying fees for the witness, are considered disbursements: Re Felton (1942) 60 WN(NSW) 16; Ly v Jenkins (2001) 114 FCR 237 at 247 – 248; and

c the definition of legal costs does not require the incurring of a liability on the part of the party’s legal practitioner to pay them in order for them to be disbursements, but if there is such a requirement, such a liability has been established in this case because the solicitor, Mr Freeman, requested Mr Doran to prepare evidence on certain matters in order for Mr Freeman to properly discharge his duties to each of the defendants, Mr Doran carried out that work and Mr Freeman took the benefit of it because he discharged his duties to his clients. It followed that an obligation arose or may arise upon Mr Freeman’s firm to pay Mr Doran for the work requested. Support for the last of these propositions was said to be found in Damberg v Damberg (2001) 52 NSWLR 492 at [191] – [192].

48 The following principles are established by the authorities:

a the “costs” provided for in s 76(1) of the Supreme Court Act and the cognate Supreme Court Rules1970 (NSW) do not include time spent by a litigant who is not a lawyer in preparing and conducting his case. They are confined to money paid or liabilities incurred for professional legal services. Compensation for the loss of time of a litigant in person cannot be said to constitute costs within the meaning of the rules: Cachia v Hanes (1994) 179 CLR 403 at 419-410;

b traditionally, disbursements have been either payments made, or liabilities incurred, by a practitioner acting for the party in whose favour a costs order is made which the practitioner is bound to pay, or payments which by established custom or practice of the profession the practitioner is bound to pay: Re Remnant (1849) 50 ER 949; Ly v Jenkins at 247. Such disbursements can include witnesses’ expenses: Re Felton at 16;

c the rule in equity has long been that costs between party and party include the costs of witnesses qualifying themselves to give evidence and the rule is not limited to true experts: see for example Barwick v Barwick & Hinks (1937) 33 Tas LR 1 and Kerridge v Foley (unreported SCNSW 19.08.70 per Street J);

d a litigant, whether represented or not, may be entitled to some witnesses’ expenses in addition to expenses for time actually spent in giving evidence in court. Where attendance at court is reasonably necessary to deal with unforeseeable evidence as it arises, the expense of that attendance may well be allowed, but not as a matter of course. There must be at least a reasonable expectation of something new arising, which would require prompt instructions: Lawrence v MD Nikolaidis & Co (2003) 57 NSWLR 355 at 373 [48]-[48]; and

e expenses may be allowed for a conference with a solicitor or barrister in so far as it is necessary in order to prepare for giving oral evidence or to prepare an affidavit. Expenses are not allowed in relation to such matters as collation of documents or other material in preparation for giving instructions or giving evidence, time spent in refreshing recollection or making notes with a view to giving evidence or giving instructions, and matters of like nature: Lawrence v MD Nikolaidis & Co at 373 [50] – [51].

49 The question here is one of construction of the particular statute. The provisions are to be read in the context of other provisions of the same enactment if possible so as to render various provisions congruent in their operation: Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355 at 381-382; Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 at 179; Wilkie v Gordian RunoffLtd (2005) 221 CLR 522 at 529.

50 The declaration originally sought concerns, and concerns only, requirements imposed on an assessor in making an assessment of “legal costs” which are the subject of an order.

51 The definition of “legal costs” is to be contrasted with the definition of “costs” in s 302 of the Act.

52 The definition of legal costs and the process provided for in s 364 of the Act are directed to assessing those costs (whether by way of services rendered or the incurring of disbursements) where the activity gives rise to, or may give rise to a liability to, a law practice.

53 The term “disbursements” in the definition in s 4(1) of the Act is a term of expansion intended to comprehend amounts payable, or which may become payable, to the law practice beyond amounts only for the provision of legal services. However, it remains a requirement that those disbursements actually be or potentially be charged for, or be or become a liability to the law practice.

54 Section 364 of the Act is not intended to govern the assessment process in respect of costs which fall within an order but are not “legal costs” within the definition of s 4(1). The assessment process for those costs is governed by s 367A of the Act.

55 The proposed claims which are the subject of Mr Doran’s affidavit evidence, and the terms of the principal declaration sought which the evidence of Mr Doran is intended to sustain, do not have the quality of amounts having been charged for and they do not appear to me to be susceptible to being charged for by the solicitor so as to become a liability of the defendants to him.

56 I do not accept the submission that “disbursements” somehow stands alone without any requirement of a nexus to the law practice referred to in s 4(1) of the Act.

57 The submission based on Damberg v Damberg (which was not made in the written outline initially provided by the defendants) is unsustainable. There is nothing to suggest that the defendants’ solicitor was not, or was not entitled to be, paid for the discharge of his professional duty.

58 In performing the work that Mr Doran did, Mr Doran was not acting in the interests of the solicitor and performing work for the practitioner’s benefit. He did what he did in his own interests and in the interests of the other defendants, being his co-directors and the companies of which he was a director.

59 There is nothing to suggest that he would have acted any differently if he or the companies of which he was a director were the only defendants in the proceedings.

60 A logical (and I consider untenable) conclusion of the defendants’ argument is that Mr Doran would be liable to his solicitor for work which he, Mr Doran, himself did.

61 For these reasons, the principal declaration prayed for must be refused.

62 There are further reasons why, in my view, it should be refused.

63 The term “costs” in the order of Palmer J is to be given the meaning of that term in s 76 of the Supreme Court Act or s 98 of the Civil Procedure Act (as the case may be).

64 The discretion which his Honour exercised in making the costs order sprang from s 76 of the Supreme Court Act. The ambit of “legal costs” in s 364 of the Act cannot extend beyond the costs ordered by his Honour and therefore cannot extend beyond the meaning of the term “costs” in s 76 of the Supreme Court Act.

65 Even on the basis that disbursements for the purposes of s 4(1) of the Act require no nexus with the law practice, the activities described in pars 1(a) and (b) of the declaration do not, on established authority, fall within the definition of costs.

66 The same applies to the activities in par 1(c), other than where they occurred in conference with solicitor or barrister: see Lawrence v MD Nikolaidis & Co at 373; Maronis Holdings Ltd v Nippon Credit Australia Pty Limited [2002] NSWSC 838 [21].

67 Mr C D Freeman of counsel who appeared for the liquidator, conceded that the following activities on the part of Mr Doran are capable of falling within the definition of costs in s 367A of the Act:

a the reasonable value of the time devoted by Mr Doran in conference with solicitor and counsel for the purpose of preparing his affidavit and oral evidence and in giving oral evidence; and

b the reasonable value of the time spent by Mr Doran at Court when reasonably necessary to deal with unforeseeable evidence.

68 The concession accords with established law.

69 The declaration sought, however, covers a different field. Also, the assessment of costs, the subject of the concession, would not be governed in respect of the matters dealt with in the evidence of Mr Doran by s 364 in any event.

70 I would also refuse the declaration on discretionary grounds. No assessment has commenced and there is nothing to suggest that if seized of the assessment, the assessor might take a wrong approach.

71 The defendants did not refer me to any authority where the Court made a declaration of the nature of that sought here before the assessment process had commenced.

72 The closest they came was the decision of Davies AJ in Commonwealth Bank of Australia v Hattersley (2001) 51 NSWLR 333 where his Honour found that an assessor who was engaged in the process of assessment was taking a wrong direction. The issue arose after the assessor had written a letter containing a series of passages which indicated that he was taking a line which his Honour considered could not be sustained as a mater of law. That is not this case.

73 An additional reason for refusing declaratory relief is that there is a statutory procedure in the Act - s 384 - for an appeal against an assessment on a matter of law: see eg Currabubula v State Bank of New South Wales [2000] NSWSC 232.

74 It was put that the declaration would be of utility because of the additional expense that would be incurred by the defendants if they take a wrong view by reason of the extensive preparation required for an itemised bill of costs on the matters the subject of Mr Doran’s affidavit evidence.

75 The declaration in the wide terms sought is, in my view, of little utility having regard to the factors which the assessor would have to take into account and items claimed might be disallowed in any event.

76 The application to include the alternative declaration was refused because I considered it to be futile and would not have granted it as a matter of discretion. Whether the value of time spent on any of the matters sought to be covered by the alternative formulation of the declaration is costs will depend on the facts, which is a matter for the assessor.

77 How the matter is to be approached by the assessor is governed by statute and clear authority.

78 So far as the alternative declaration seeks to cover preparation of affidavit evidence and giving of oral evidence without any qualification, it does not accord with established authority. In my view it would be of little or no utility to the assessment process.

The interest issue

79 The power to award interest on costs is contained in s 101(4) of the Civil Procedure Act. In Lahoud v Lahoud [2006] NSWSC 126 at [78 and following] Campbell J gave consideration to that provision. There is no requirement for the circumstances of the case to be out of the ordinary for an order to be made.

80 Underlying the provision is that the successful party has been out of pocket having to pay its lawyer’s costs and disbursements.

81 The only matter Mr Freeman put with regard to the payment of interest was that the defendants had delayed in implementing the assessment process. He argued that they should be allowed interest only for a period of one year after the High Court dismissed the application for special leave, that is, to 10 February 2007.

82 No evidence on behalf of the liquidator was proffered upon which I could make a finding that there has been any unreasonable or inordinate delay.

83 The parties agreed that a reasonable time for the assessment process to be completed commencing now would be 12 months and I propose to make an order along the lines made by Campbell J in Lahoud v Lahoud that interest be paid on costs awarded by Palmer J up to date of payment or 13 February 2009, whichever occurs the earlier, unless the Court otherwise orders so that the payment of interest beyond that date is a matter which may be agitated if it becomes necessary to do so.

84 Mr Freeman addressed submissions as to interest payable on the costs of the Court of Appeal proceedings. He drew to my attention that an order for the payment of interest on the costs may properly be a matter for the Court of Appeal but he did not put that I should not make such an order.

85 Without deciding the matter, it seems to me that I should make orders with respect to the Court of Appeal costs for two reasons.

86 Firstly, because of the dictate that the Court should dispose of litigation on a quick, just and cheap basis, and secondly, because the provisions of s 98(6)(b) of the Civil Procedure Act, at least on a preliminary basis, appear to me to mean that the costs of the Court of Appeal may be the subject of the orders which I propose to make.

87 I propose to order that the defendants are entitled to interest on the costs which the liquidator was ordered to pay by the Court of Appeal on the same basis as they must pay interest on the costs of the proceedings before Palmer J.

88 The parties are to bring in Short Minutes.

89 The orders of the Court will be that the claim for a declaration as sought in the Interlocutory Process is refused.

90 There will be orders for interest as contemplated by these reasons.

91 The plaintiffs have been unsuccessful on the principal issue but were successful on two discreet subsidiary issues. In my view the appropriate order is that the first to fifth defendants are to pay fifty per cent of the liquidator’s costs.

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