SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
LYONS v LEGALESE PTY LTD & ORS (No 2)
[2017] SASC 2
Reasons for Decision of The Honourable Justice Hinton
13 January 2017
PROCEDURE - COSTS - GENERAL RULE - COSTS FOLLOW THE EVENT
PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - PROCEDURE UNDER RULES OF COURT - PAYMENT INTO COURT, AND OFFERS TO SETTLE OR CONSENT TO JUDGMENT
Reasons for decision on an application for costs of action.
The plaintiff succeeded in obtaining an order restraining the first and third defendants from acting for their client, the second defendant, in an inferior court.
The plaintiff sought an order for costs of the application on the basis that there was no reason to depart from the general rule that costs follow the event.
The first and third defendants contended that there be no order as to costs, on the ground that an offer was put approximately two weeks prior to trial, and that the litigation may be characterised as public interest litigation. In the alternative, the first and third defendants sought a reduction in the award of costs on the basis that the plaintiff was not successful on all issues and no real need existed for the plaintiff to have the benefit of the assistance of senior and junior counsel.
Held:
1. There is no reason to depart from the general rule that costs follow the event. The plaintiff is awarded the costs of and occassioned by the application.
2. The proceedings cannot be characterised as public interest litigation.
3. It was not unreasonable for the plaintiff to instruct senior and junior counsel.
Supreme Court Act 1935 (SA) s 40, s 72; Supreme Court Civil Rules 2006 (SA) r 263, referred to.
Rasch Nominees Pty Ltd & Anor v Bartholomaeus & Ors [2013] SASCFC 105; Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492; Oshlack v Richmond River Council (1998) 193 CLR 72; Norbis v Norbis (1986) 161 CLR 513; Latoudis v Casey (1990) 170 CLR 534; Cachia v Hanes (1994) 179 CLR 403; Knight v F P Special Assets Ltd (1992) 174 CLR 178; Mericka v Rathbone (2016) 125 SASR 563; Waters v PC Henderson (Australia) Pty Ltd (1994) 254 ALR 328; Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd (1993) 26 IPR 261; Stanley v Phillips (1966) 115 CLR 470; Cretazzo v Lombardi (1975) 13 SASR 4, considered.
LYONS v LEGALESE PTY LTD & ORS (No 2)
[2017] SASC 2Civil
HINTON J.
Introduction
On 5 October 2016 I ordered that Legalese Pty Ltd and the partnership, P A Scragg & R V Scragg, and any legal practitioner employed by them or acting as agent for them, be restrained from acting for Kathy Morris (nee Butcher) in Action No AMCCI-14-3641 in the Magistrates Court of South Australia. On 18 October 2016 I ordered that Legalese Pty Ltd and the partnership, P A Scragg…
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- AGLC
- Lyons v Legalese Pty Ltd (No 2) [2017] SASC 2
- Case
- [2017] SASC 2
- Decision Date
CaseChat Overview and Summary
The court considered the general rule that costs follow the event and noted that the plaintiff's legal team had conducted themselves fairly and professionally, providing ample notice to the defendants of the impending application and allowing them an opportunity to consider their position. The court rejected the argument that the plaintiff did not succeed on all issues, finding that the plaintiff's case against the defendants' conduct was strong enough to warrant an award of costs. The court also dismissed the notion that the proceedings were public interest litigation, as there was no broader public interest at stake beyond the specific dispute between the parties.
In conclusion, the court found that fairness dictated that the successful party should be awarded costs, and ordered the defendants to pay the plaintiff's costs of and occasioned by the application, resulting in the court's order of 5 October 2016. The court emphasised that the proceedings were not of a nature that would exempt the defendants from paying costs, and that the principles applied were not novel.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
Ratio Decidendi
Legal Principle Established
Established by: HINTON J
The contention that Ms Lyons did not succeed on all issues focuses upon that limb of Ms Lyons’ case in this Court to the effect that Peter Scragg & Associates had conducted the Magistrates Court proceedings on behalf of Ms Morris in a manner at odds with what was properly to be expected of the disinterested practitioner and in pursuit of its own interests. I dealt with this limb of Ms Lyons’ case at some length in my reasons.[32] I was not persuaded that Mr Scragg and Peter Scragg & Associates had, since filing the statement of claim and prior to receiving Allianz’s letter of 10 March 2015, acted in the conduct of Ms Morris’ claim in furtherance of their own interests. I was satisfied, however, that Mrs Scragg and Peter Scragg & Associates had an interest in the outcome of Ms Morris’ application for an extension of time distinct from their interest in supporting the success of their client by the discharge of their professional skill and duties in the action. [32] Lyons v Legalese Pty Ltd& Ors (2016) 126 SASR 232 at [132]-[149].Consideration I do not think the rejected offer of 12 July 2016 provides reason to divert from the general rule. Bearing in mind the notice that Peter Scragg & Associates had of the intention to pursue these proceedings, including the stipulation of a day upon which they would be instituted, and the failure by Peter Scragg & Associates to act before the cost of instituting the action was incurred, it is understandable that Ms Lyons’ solicitors did not accede to that offer. Whilst the benefits of requiring Peter Scragg & Associates to submit to a consent order of this Court, enforceable by this Court, as opposed to undertakings given between practitioners, may be arguable, cost had been incurred by reason of the refusal on the part of Peter Scragg & Associates to cease acting prior to that time. By 12 July 2016 such costs extended beyond those incurred in drawing and engrossing the initiating documentation and supporting affidavits to the attendance at court on two occasions and the preparation of a notice of contentions, an amended notice of contentions and written submissions. This incursion of such costs by Ms Lyons’ lawyers would have been plain to Peter Scragg & Associates. The rejection of the counter offer bespeaks an intent to run the risk in this Court of an unfavourable outcome. The characterisation of these proceedings as public interest litigation was never fully explained. It was somehow suggested to be linked to the Motor Accident Commission’s desired approach to cases such as this. In my view these proceedings cannot be characterised as public interest litigation in the sense referred to above. Nothing in the resolution of Ms Lyons’ application determines more generally questions as to rights, entitlements and interests arising under or affected by the exercise of the power of the state, or impaired in some way by statute. There is no suggestion of other cases the resolution of which are awaiting the outcome of this matter. Nor is there any ‘public power’ exercised in this case which, it could be argued, should not be subject to the chill of costs implications. This case does not bear the hallmarks of a test case that will resolve issues in dispute in other cases or more generally. Lastly, the principles applied in this case are not novel.