Macdonald v Macdonald (No 2)

[2018] NSWSC 296

Supreme Court

New South Wales

Medium Neutral Citation:

Macdonald v Macdonald (No 2) [2018] NSWSC 296

Hearing dates:

On the papers

Decision date:

09 March 2018

Jurisdiction:

Common Law

Before:

Adamson J

Decision:

(1)   Order the plaintiff to pay the defendant’s costs of the proceedings.

(2) Note that, pursuant to order (3) in the principal judgment made on 6 February 2018, the defendant has leave to apply for an order pursuant to s 98(4) of the Civil Procedure Act 2005 (NSW) that the costs be paid in a gross sum if such application is made in writing to my Associate, together with any evidence and submissions in support, within 7 days hereof and such material is also served on the plaintiff within that time.

(3)   Direct that, if an application referred to in (2) above is made:
(a)   The plaintiff serve on the defendant and provide to my Associate any submissions and evidence in opposition to the defendant’s application within a further 7 days; and
(b)   The defendant is to serve on the plaintiff and provide to my Associate any submissions or evidence in reply within a further 5 days.

Catchwords:

COSTS – unsuccessful plaintiff impecunious – no reason to depart from general rule that costs follow the event – no question of principle

Legislation Cited:

Civil Procedure Act 2005 (NSW) s 98(4)
Uniform Civil Procedure Rules 2005 (NSW) r 42.1

Cases Cited:

Hession v Century 21 South Pacific Ltd (In Liq) (1992) 28 NSWLR 120
Macdonald v Macdonald [2018] NSWSC 64

Category:

Costs

Parties:

Sini Moa Macdonald (Plaintiff)
Denis Halding Macdonald (Defendant)

Representation:

Counsel:
K Qoro (Plaintiff)
L Steer (Defendant)

  Solicitors:
Pinnacle Lawyers (Plaintiff)
Young and Muggleton (Defendant)

File Number(s):

2016/368703

Publication restriction:

Nil

Judgment

1. On 6 February 2018 I made orders and published reasons in this matter: Macdonald v Macdonald [2018] NSWSC 64 (the principal judgment). As to costs, I made the following orders:

“(2)   Unless an application for a different order is made in writing to my Associate within seven days hereof, order the plaintiff to pay the defendant’s costs of the proceedings.

(3) Grant liberty to the party in whose favour a costs order is made (whether by default or following an application under (2) above) to make an application for a gross sum costs order pursuant to s 98(4) of the Civil Procedure Act 2005 (NSW), such application to be made in writing within seven days of a costs order becoming operative or within such time as directed by further order.”

2. On 13 February 2018 the plaintiff’s solicitor provided submissions to my Associate in support of her application for an order that each party pay his or her own costs. The basis of this application was that she is impecunious and obtained pro bono assistance from her solicitors in order to conduct the hearing in this Court. My Associate also received from the plaintiff herself on 13 February 2018 an email which related to the merits of the proceedings, which I propose to disregard for the purposes of determining the issues relating to costs.

3. Ms Steer submitted, on behalf of the defendant, that there was no reason to depart from the general rule that costs follow the event. She contended that the admitted impecuniosity of the plaintiff is no reason to depart from the usual order.

Consideration

4. While the plaintiff’s impecuniosity may make it unlikely that an order requiring her to pay the defendant’s costs will be complied with, it is not a reason for not making the order. The oft-cited maxim that poverty is no bar to a litigant, while relevant in the context of an application for security for costs, is not relevant to whether a costs order ought be made. Its effect in the context of security for costs is that an order for security will not generally be made against an impecunious plaintiff who is a natural person: Hession v Century 21 South Pacific Ltd (In Liq) (1992) 28 NSWLR 120 at 123. However, the plaintiff’s admitted impecuniosity does not warrant departure from the general rule that costs follow the event: (Uniform Civil Procedure Rules 2005 (NSW), r 42.1). She initiated the proceedings and has been unsuccessful. The defendant has incurred costs by defending the proceedings. He is entitled to an order that his costs be paid by the plaintiff.

5. The plaintiff’s admitted impecuniosity is, however, relevant to the making of an order that costs be paid in a gross sum pursuant to s 98(4) of the Civil Procedure Act 2005 (NSW). It is generally regarded as unjust for a party to be required to spend money on a costs assessment in circumstances where, as here, neither the costs themselves, nor the cost of a costs assessment are likely to be recoverable. This question does not presently arise and will arise only if the defendant chooses to make such an application pursuant to the leave granted in order (3) in the principal judgment.

Orders

6. For the reasons set out above, I make the following order, notation and direction:

1. Order the plaintiff to pay the defendant’s costs of the proceedings.

2. Note that, pursuant to order (3) in the principal judgment made on 6 February 2018, the defendant has leave to apply for an order pursuant to s 98(4) of the Civil Procedure Act 2005 (NSW) that the costs be paid in a gross sum if such application is made in writing to my Associate, together with any evidence and submissions in support, within 7 days hereof and such material is also served on the plaintiff within that time.

3. Direct that, if an application referred to in (2) above is made:

1. The plaintiff serve on the defendant and provide to my Associate any submissions and evidence in opposition to the defendant’s application within a further 7 days; and

2. The defendant is to serve on the plaintiff and provide to my Associate any submissions or evidence in reply within a further 5 days.

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