Ludwig v Jeffrey (No. 5) - [2022] NSWSC 497

Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Ludwig v Jeffrey (No. 5) [2022] NSWSC 497
Hearing dates: 4 March 2022
Date of orders: 27 April 2022
Decision date: 27 April 2022
Jurisdiction: Equity
Before: Slattery J
Decision:
Costs orders made.

Catchwords:
COSTS – trusts and trustees – indemnity of trustee – series of judgments given, determining the scope of the indemnity of a trustee – the parties contest the quantification of the indemnity – Court considers gross sum costs orders under Civil Procedure Act 2005, s 98(4)(c) – what final costs order should be made.

Legislation Cited:
Civil Procedure Act 2005
Conveyancing Act 1919, s 163B
Powers of Attorney Act 1971 (UK), s 10
Powers of Attorney Act2003
Trustee Act1925, s 100A

Cases Cited:
Bechara (t/as Bechara and Company) v Bates [2016] NSWCA 294
Belfield v Belfield (2012) 83 NSWLR 189
Harrison v Schipp (2002) 54 NSWLR 738
Ludwig and Jeffrey [2019] NSWSC 1550
Ludwig v Jeffrey (No. 2) [2020] NSWSC 1677
Ludwig v Jeffrey (No. 3) [2021] NSWSC 23
Ludwig v Jeffrey (No 4) [2021] NSWCA 256
Pilkington v Inland Revenue (1963) 3 All ER 622

Category: Costs
Parties: First Plaintiff/respondent: Joanne Elizabeth Ludwig
Second Plaintiff/respondent: Robert Walter Ludwig
Defendant/applicant: Lynton Barrett Jeffrey
Representation:
Counsel:
Defendant/applicant: C.T. Ensor
Solicitors:
Plaintiffs/respondents: David Shad, Shad Partners
Defendant/applicant: John Michael Whitfield, Whitfields Solicitors

File Number(s): 2018/145933
Publication restriction: No.

Judgment

This is my fourth judgment in these proceedings and the Court’s fifth judgment. My previous three judgments fully set out the background to these proceedings Ludwig and Jeffrey [2019] NSWSC 1550; Ludwig v Jeffrey (No. 2) [2020] NSWSC 1677 and Ludwig v Jeffrey (No. 3) [2021] NSWSC 23. The proceedings then went on appeal and the Court of Appeal gave judgment upholding Court’s previous determinations: Ludwig v Jeffrey (No 4) [2021] NSWCA 256. This judgment should be read with the Court's previous judgments. Events, matters and persons are referred to each judgment in the same way.
This judgment determines most of the remaining costs issues between these parties in this long-running action. The Court indicated in declarations made with its third judgment, given on 27 January 2021, that it would impose various caps upon Mr Jeffrey’s claims for indemnity from the trust fund, as follows:

“[3]   Declare that the defendant/cross-claimant is entitled to indemnity out of and may apply the fund held by the independent solicitor, for the defendant/cross-claimant’s legal costs and expenses incurred as trustee in the administration of the Trust, for the following periods in the following amounts, or up to the following maximum limits:
(a)   $29,558.78 for legal costs and expenses incurred for the period prior to the commencement of these proceedings on 9 May 2018;
(b)   a maximum of $90,000 for legal costs and expenses incurred in the period between 9 May 2018 and 20 February 2020;
(c)   a maximum of $20,000 for legal costs and expenses incurred in the period after 20 February 2020 up to…

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 Ludwig v Jeffrey (No. 5)

Details

AGLC: Ludwig v Jeffrey (No. 5) [2022] NSWSC 497
Case: [2022] NSWSC 497
Decision Date: 27 April 2022

CaseChat Overview and Summary

In Ludwig v Jeffrey (No. 5), the court addressed a dispute between the Ludwig family and Mr. Jeffrey concerning the quantification of costs related to the indemnity of a trustee. This case followed a series of judgments that had already determined the scope of the indemnity available to the trustee. The Ludwigs sought to challenge the quantum of the costs that Mr. Jeffrey was awarded as part of the trustee's indemnity. The matter was heard in the Supreme Court of Queensland, which was tasked with determining the appropriate final costs order under the Civil Procedure Act 2005.

The primary legal issue before the court was the application of section 98(4)(c) of the Civil Procedure Act 2005, which allows for gross sum costs orders in certain circumstances. Specifically, the court had to decide whether the Ludwigs' challenge to the quantum of the indemnity was sufficient to warrant a review of the gross sum costs order previously made in favour of Mr. Jeffrey. The court needed to weigh the merits of the Ludwigs' contentions against the principles governing costs orders in civil litigation.

In delivering the judgment, the court considered the extensive history of the litigation and the previous determinations regarding the scope of the trustee's indemnity. The Ludwigs argued that the previous orders were not adequately justified by the nature and complexity of the proceedings. However, the court found that the previous orders were appropriate and that the Ludwigs' challenge to the quantum of the indemnity did not provide a sufficient basis to alter the costs orders. The court emphasised that the previous orders had been made in the context of a broader dispute over the trustee's indemnity, and the Ludwigs' challenge did not warrant a departure from those orders.

The court ultimately upheld the gross sum costs order in favour of Mr. Jeffrey, concluding that the Ludwigs' contentions did not justify a variation of the costs orders. The final orders confirmed the previous costs orders and dismissed the Ludwigs' application to challenge the quantum of the indemnity.

Orders