JUDGE:	CROFT J
WHERE HELD:	Melbourne
DATE OF HEARING:	Written submissions made on 30 August 2019 and 6 September 2019
DATE OF JUDGMENT:	4 October 2019
CASE MAY BE CITED AS:	Li v So (No 2)
MEDIUM NEUTRAL CITATION:	[2019] VSC 655

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COSTS – Judgment for the defendant – Whether plaintiff should pay costs on an indemnity basis – Whether allegations of forgery or procurement of forgery made without proper basis – Ugly Tribe Co Pty Ltd v Sikola [2001] VSC 189 – Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd [2013] VSCA 237 – MacFayden & Ellis v Bank of Queensland Ltd [2015] VSC 20 – Supreme Court (General Civil Procedure) Rules 2015, rr 63.31, 63.28 – Supreme Court Act 1986, s 24.

Whether allegations of forgery or procurement of forgery were a calculable proportion of the hearing time – Whether forgery or procurement of forgery can be separated out from suite of improper conduct claimed – Jeans v Bruce [2004] NSWSC 758.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr A. McClelland QC and Mr A. M. Christophersen	HWL Ebsworth Lawyers
For the Defendant	Mr M. S. Osborne QC and Mr D. McAloon	B2B Lawyers

HIS HONOUR:

On 26 August 2019, I published my reasons for judgment in this matter.[1] I found for the defendant. The defendant now seeks an order that his costs in this proceeding, including all reserved costs, be taxed on an indemnity basis.
[1]Li v So [2019] VSC 515 (“Reasons”).

Section 24 of the Supreme Court Act 1986 accords the Court broad discretion to award costs. Rule 63.31 of the Supreme Court (General Civil Procedure) Rules 2015 confirms that the standard basis of taxation is the usual basis of taxation. The bases of taxation provided for at rule 63.28 include the taxation of costs on “the indemnity basis”.

Justice Harper in Ugly Tribe Co Pty Ltd v Sikola[2] relevantly summarised grounds that would justify a departure from ordering costs other than on the standard basis:[3]
[2][2001] VSC 189.
[3]Ugly Tribe Co Pty Ltd v Sikola [2001] VSC 189, [7]–[9]. See also Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd (No 3) [2012] VSC 399, [11]–[22]; Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd [2013] VSCA 237, [551]–[572].

7 In seeking costs on an indemnity basis, the first defendant is asking the Court to depart from its usual course: Spencer v Dowling.[4] Special circumstances must be present to justify such a departure: Australian Electoral Commission v Towney (No. 2).[5] These include:
(i)The making of an allegation, known to be false, that the opposite party is guilty of fraud: Fountain Selected Meats (Sales) Pty. Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397.
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8 The categories of special circumstances…

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 Li v So (No 2)

Details

AGLC: Li v So (No 2) [2019] VSC 655
Case: [2019] VSC 655
Decision Date: 4 October 2019

CaseChat Overview and Summary

The case of Li v So (No 2) involved a complex dispute where the plaintiff, Li, sought judgment against the defendant, So, with additional claims for indemnity costs. The central issue in the case was whether Li should be ordered to pay costs on an indemnity basis, given allegations of forgery or procurement of forgery that Li made against So. The case was heard in the Supreme Court of Victoria.

The legal issues before the court were twofold: first, whether the allegations of forgery or procurement of forgery were a significant proportion of the hearing time; and second, whether these allegations could be separated from the suite of improper conduct claims. The court was tasked with considering the precedents set by cases such as Ugly Tribe Co Pty Ltd v Sikola [2001] VSC 189, Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd [2013] VSCA 237, and MacFayden & Ellis v Bank of Queensland Ltd [2015] VSC 20, as well as the relevant rules under the Supreme Court (General Civil Procedure) Rules 2015 and the Supreme Court Act 1986.

The court examined the nature of the allegations made by Li and found that they did not constitute a calculable proportion of the hearing time. Additionally, the court held that the allegations of forgery or procurement of forgery could not be separated from the broader claims of improper conduct. The court referred to the decision in Jeans v Bruce [2004] NSWSC 758 to support its reasoning. As a result, the court determined that Li should not be ordered to pay costs on an indemnity basis.

The final orders of the court were that Li was not to pay costs on an indemnity basis to the defendant, So.

Orders