Mandeville v Better Lending Pty Ltd (No 2) - [2021] SASCA 61

SUPREME COURT OF SOUTH AUSTRALIA
(Court of Appeal: Civil)
MANDEVILLE v BETTER LENDING PTY LTD & ANOR (No 2)
[2021] SASCA 61
Judgment of the Court of Appeal
(The Honourable Justice Doyle, the Honourable Justice Livesey and the Honourable Justice Bleby)
9 June 2021

APPEAL AND NEW TRIAL - PROCEDURE - SOUTH AUSTRALIA - POWERS OF COURT - COSTS
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS
Following the Court’s decision on 3 May 2021 allowing the appellant’s appeal and dismissing the cross-appeal, the parties made written submissions on the costs of the appeal and of the lower court proceedings.
The appellant seeks orders that the respondent pay her costs of the appeal and cross appeal, as well as her costs of Action 83 of 2016, on an indemnity or solicitor/client basis. She also seeks an order that the sum of $20,000 standing to the credit of Action 84 of 2016 be paid out of court to her.
The respondent seeks a stay of the execution of the judgment, and orders that the $20,000 remain in court pending the outcome of an imminent application of Special Leave to appeal to the High Court. He also seeks that ‘any orders of costs have a full accounting and reconciliation’ reflecting the relative successes of the parties.
Held (by the Court), awarding the appellant 80 per cent of her costs of the appeal and cross appeal on a party/party basis, 90 per cent of her costs in Action 83 of 2016, and ordering that the sum of $20,000 held in the Suitor’s Fund be paid out of Court to the appellant:
1. The respondent has not provided this Court with any evidence of the state of the intended application for Special Leave to appeal and there is nothing to indicate that the its rights would be rendered nugatory in the event of a stay not being granted.
2. This Court is best placed to determine the appropriate characterisation of instances of success or failure in the judgment on appeal. It is not necessary, for that purpose, to have a ‘full accounting and reconciliation’ of the parties’ successes and failures.
3. A considerable part of the appellant’s appeal was devoted to issues and arguments that were either unnecessary or on which she was unsuccessful. That should be reflected in the costs order, although the weighting should be in her favour.
4. With respect to Action 83 of 2016, there is no basis to depart from the ordinary principle that costs should be awarded on a party/party basis.
National Consumer Credit Protection Act 2009 (Cth) s 177; Enforcement of Judgments Act 1991 (SA) s 17; Uniform Civil Rules 2020 (SA) r 215.4; High Court Rules 2004 (Cth) r 41.02.1; Supreme Court Act 1935 (SA) s 40, referred to.
Mandeville v Better Lending Pty Ltd & Anor [2021] SASCA 28; Mandeville v Better Lending Pty Ltd & Anor (No 6) [2019] SADC 168, discussed.
Legal Practitioners Conduct Board v Viscariello (No 2) [2013] SASCFC 47; Jennings Construction Limited v Burgundy Royale Investments Proprietary Limited (1986) 161 CLR 681; Bryant v Commonwealth Bank of Australia (1996) 70 ALJR 306; Ruddock v Vadarlis (No 2) (2001) 115 FCR 229; Bell v Deputy Coroner of South Australia (No 2) [2020] SASC 77; A, DC v Prince Alfred College Inc (No 2) [2016] SASCFC 27; Australian Trade Commission v Disktravel [2000] FCA 62; Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107; Amaca Pty Ltd v Werfel (No 2) [2021] SASCFC 26; Cretazzo v Lombardi (1975) 13 SASR 4; GT Corp Pty Ltd v Amare Safety Pty Ltd [2008] VSC 296; Mickelberg v State of Western Australia [2007] WASC 140; Oshlack v Richmond River Council Oshlack v Richmond River Council (1998) 193 CLR 72; Monier Ltd v Metalwork Tiling Co of Australia Ltd (No 2) (1987) 43 SASR 588; Colgate-Palmolive Co v Cussons (1993) 46 FCR 225, considered.

MANDEVILLE v BETTER LENDING PTY LTD & ANOR (No 2)
[2021] SASCA 61

Court of Appeal - Civil: Doyle, Livesey and Bleby JJA

THE COURT:         On 3 May 2021, the Court gave judgment in this matter, allowing the appeal in part and dismissing the cross-appeal (‘the judgment on appeal’).[1] The facts are set out in the judgment on appeal. The appeal and cross appeal had arisen out of three judgments of the District Court, the effect of which this Court summarised in the judgment on appeal as follows:[2]
[1]     Mandeville v Better Lending Pty Ltd & Anor [2021] SASCA 28.
[2]     Mandeville v Better Lending Pty Ltd & Anor [2021] SASCA 28 at [31]-[34].
In essence, the preliminary issue was whether by reason of the default judgment and the principles of res judicata or issue estoppel, Better Lending was precluded from pursuing any further claims in what was at that stage the Second Statement of Counterclaim.
On this preliminary issue, the judge concluded that the default judgment did not preclude Better Lending from making further claims under the second loan agreement by reason of either res judicata or issue estoppel.
The second judgment, being judgment on the trial of the action, was delivered on 21 June 2019.[3] The Court:[4]
·dismissed Ms Mandeville’s claim that Better Lending was estopped by an Anshun estoppel from making any further claim by reason of the default judgment in the previous Magistrates Court action;
·dismissed Ms Mandeville’s claim to the effect that any further claim by Better Lending constituted an abuse of process by reason of the earlier default judgment;
·dismissed Ms Mandeville’s claims based on duress, undue influence and unconscionable conduct;
·granted an injunction pursuant to s 177 of the National Consumer Credit Protection Act 2009 (Cth) preventing Better Lending from recovering any interest on the loan; and
·on the counterclaim, gave judgment for Better Lending against each of Mr and Ms Mandeville in the sum of $43,000. This represented the difference between the $124,000 already paid and the balance of the principal loan, being $167,000.
The third judgment the subject of this appeal is the decision on costs, made on 20 February 2020. Having regard to the mixed result of the trial, the judge ordered that Better Lending pay 80 per cent of the costs of Ms Mandeville on a party/party basis. The judge noted that this would have the effect that the costs liability of Better Lending would exceed the $43,000 judgment, and acceded to a request that he stay that judgment pending quantification of costs.
[3]     Mandeville v Better Lending Pty Ltd & Anor (No 6) [2019] SADC 168.
[4]     Mandeville v Better Lending Pty Ltd & Anor (No 6) [2019] SADC 168 at [146]-[150].
The effect of this Court’s orders on appeal was:
·to dismiss the counterclaim, with the effect that judgment for Better Lending in the sum of $43,000 on the counterclaim was set aside; and
·in place of an order pursuant to s 177 of the National Consumer Credit Protection Act 2009 (Cth) (‘NCCPA’) restraining Better Lending from recovering any further amount of principal or any amount of interest, or other costs or charges except for the sum of $43,000, an order pursuant to s 177 of the NCCPA restraining Better Lending from recovering any further amount of principal or any amount of interest, or other costs or charges.
The appellant, Ms Mandeville, now seeks the following orders:
1.1     the respondent pay the appellant’s costs of the appeal;
1.2     the respondent pay the appellant’s costs of the cross appeal;
1.3     subject to any orders for costs already made in Action 83 of 2016:
1.3.1 the respondent pay the appellant’s costs of Action 83 of 2016;
1.3.2 the respondent pay such costs on an indemnity or solicitor/client basis; and
1.4the sum of $20,000 standing to the credit of Action 84 of 2016 be paid out of court to the appellant.
The first respondent/cross appellant, Better Lending, seeks the following orders:
1.1All orders of the Court are stayed pending the outcome of an imminent application of leave to appeal the Appeal/Cross Appeal judgment.
1.2That any and all orders of costs against the First Respondent/Cross Appellant be made on a party-to-party basis.
1.3That any orders of costs have a full accounting and reconciliation to reflect the proper proportion of costs on which the Appellant/Cross Respondent was unsuccessful as well as successful on.
1.4That any orders for costs already made in Action 83 of 2016 are stayed pending the outcome of an imminent application of leave to appeal the Appeal/Cross Appeal judgment and/or full accounting and reconciliation.
1.5That any orders for costs already made in Action 84 of 2016 are stayed pending the outcome of an imminent application of leave to appeal the Appeal/Cross Appeal judgment and/or full accounting and reconciliation.
1.6The sum of $20,000 standing to the credit of Action 84 of 2016 remain in court pending the outcome of an imminent application of leave to appeal the Appeal/Cross Appeal judgment and/or full accounting and reconciliation.
Stay of orders
The Court has a discretion to stay the execution of a judgment where a party intends to make an application for Special Leave to appeal to the High Court.[5] A stay will only be granted in such a case in exceptional circumstances. This Court reviewed the relevant authorities in Legal Practitioners Conduct Board v Viscariello (No 2).[6] In Jennings Construction Limited v Burgundy Royale Investments Proprietary Limited, Brennan J observed:[7]
The jurisdiction to grant a stay in the present case depends on whether a stay is necessary to preserve the subject-matter of the litigation. If an application for special leave to appeal would be futile unless a stay is granted, the jurisdiction arises. …
…
A stay to preserve the subject-matter of litigation pending an application for special leave to appeal is an extraordinary jurisdiction and exceptional circumstances must be shown before its exercise is warranted. If an order for a stay is made, the respondent is kept out of the benefit of the order of the court in which the matter is pending until the hearing of the application for special leave to appeal. …
…
When an application for special leave to appeal is made to this Court, a jurisdiction to stay may be exercised by the court below and it is to that court — the court in which the matter is pending and which is familiar with the matter — that an application to stay should first be made. …
In exercising the extraordinary jurisdiction to stay, the following factors are material to the exercise of this Court's discretion. In each case when the Court is satisfied a stay is required to preserve the subject-matter of the litigation, it is relevant to consider: first, whether there is a substantial prospect that special leave to appeal will be granted; secondly, whether the applicant has failed to take whatever steps are necessary to seek a stay from the court in which the matter is pending; thirdly, whether the grant of a stay will cause loss to the respondent; and fourthly, where the balance of convenience lies.
[5] Enforcement of Judgments Act 1991 (SA) s 17; Uniform Civil Rules 2020 (SA), r 215.4.
[6] [2013] SASCFC 47.
[7] Jennings Construction Limited v Burgundy Royale Investments Proprietary Limited (1986) 161 CLR 681, 683, 684, 685.
In Bryant v Commonwealth Bank of Australia, Kirby J set out the principles relevant to an application for a stay pending an application for special leave, including the following:[8]
[8] Bryant v Commonwealth Bank of Australia (1996) 70 ALJR 306 at 308-309.
[1]In an application for a stay, adjunct to an application for special leave to appeal, it is necessary to consider the applicant's prospects of success in gaining special leave. But that consideration will not pre-empt the separate determination of that issue which is left to the Court, differently constituted, usually with a fuller understanding of the issues involved and with the benefit (typically) of more detailed written, and (usually) more focused oral, submissions. A decision on a stay application should not become an occasion for a detailed analysis of the issues that will arise in the special leave application and, if granted special leave, the appeal. Necessarily, the evaluation of the prospects of success will involve a judicial impression. But it is one that does not pre-determine, one way or the other, the substantive application;
…
[4]In the High Court, the old rule of stringency continues largely to be maintained, with particular force where no grant of special leave to appeal has yet been secured. There are obvious reasons for a measure of greater stringency at this point. Ordinarily, the case will have proceeded through at least two tiers of the judicial process. The would-be appellant's arguments will have been rejected by the court whose orders are the subject of the special leave application. Only a relatively small proportion of the applications for special leave succeed. To succeed, something more than legal or factual error must usually be shown. These are reasons for maintaining a higher standard in this Court for the provision of a stay than would now usually be imposed by other Australian appellate courts in respect of invocations of their jurisdiction;
[5]The expression of the stringent standard, and a description of some of the matters to be taken into account where a stay is sought before a grant of special leave, may be found in numerous reported and unreported decisions of this Court. Repeatedly, the Court has emphasised that the jurisdiction to grant a stay is exercised only in very exceptional circumstances. It is “extraordinary”. …
(Footnote omitted)
The respondent’s submissions on costs and in support of a stay were filed on 28 May 2021. Applications for Special Leave to Appeal are required to be filed within 28 days of pronouncement of judgment.[9] This Court has not, since the expiry of the 28-day period, been notified that an application has in fact been filed. This does not preclude Better Lending from seeking an order from the High Court dispensing with the time limit for filing an application.
[9] High Court Rules 2004 (Cth), r 41.02.1.
However, Better Lending has not provided this Court with any evidence of the state of the intended application, such as a draft, an account of the questions said to be arising on the application or the proposed grounds. It is therefore virtually impossible to undertake any meaningful assessment of the prospects of the mooted application for Special Leve to Appeal, other than to note the complexity of the matters that this Court decided in the judgment on appeal.
It is for the party seeking the stay to satisfy the Court that exceptional circumstances exist. The respondent has merely indicated an intention to seek Special Leave to appeal. There is nothing to indicate that Better Lending’s rights would be rendered nugatory in the event of a stay not being granted. In circumstances where the monetary effect of the judgment on appeal is to relieve Ms Mandeville of an order requiring her to pay to Better Lending the sum of $43,000 (and otherwise maintaining the monetary status quo resulting from the primary judgment, subject to costs orders), the balance of convenience speaks heavily against granting a stay pending an application for Special Leave. In the circumstances, we decline to grant a stay of execution of the judgment on appeal, or of any other costs orders. The orders sought in paragraphs 1.1, 1.4 and 1.5 of Better Lending’s costs submissions are refused.
A ‘full accounting and reconciliation’
The respondent seeks that ‘any orders of costs have a full accounting and reconciliation to reflect the proper proportion of costs on which the Appellant/Cross Respondent was unsuccessful as well as successful on’. This fails to appreciate the broad nature of the power of the Court when making costs orders, and that adjudication of the costs ordered may then follow, absent agreement as to the sum payable.
The general rule that costs ‘follow the event’ identifies that the party who succeeds on the whole will generally be awarded the costs of the action. Different issues litigated within the one proceeding may, of course, give rise to different ‘events’. As the Full Federal Court said in In Ruddock v Vadarlis (No 2):[10]
Within the general discretion of the courts to award costs it is accepted by decisions in both Australian and English jurisdictions that:
·Ordinarily costs follow the event and a successful litigant receives costs in the absence of special circumstances justifying some other order.
·Where a litigant has succeeded only upon a portion of the claim, the circumstances may make it reasonable that the litigant bear the expense of litigating that portion upon which he or she has failed.
·A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other parties' costs of them. In this sense “issue” does not mean a precise issue in the technical pleading sense but any disputed question of fact or law.
[10] (2001) 115 FCR 229 at [11] (Black CJ and French J).
This Court is best placed to determine the appropriate characterisation of instances of success or failure in the judgment on appeal. It is not necessary, for that purpose, to have a ‘full accounting and reconciliation to reflect the proper proportion of costs on which the Appellant/Cross Respondent was unsuccessful as well as successful on’.
The order sought in paragraph 1.3 of Better Lending’s costs submissions is refused.
The costs of the appeal and cross appeal
The appellant succeeded on appeal insofar as the Court found that the trial judge had erred in failing to hold that Better Lending was estopped by Anshun estoppel from bringing and prosecuting the Counterclaim. The appellant failed on grounds asserting res judicata, issue estoppel and the operation of the Magistrates Court Rules.
A number of further grounds were rendered redundant by Ms Mandeville succeeding on the Anshun estoppel ground. However, they occupied a considerable part of the appeal hearing. The Notice of Appeal, which extended to six pages of substantive grounds, with 13 grounds and numerous sub-grounds, was indiscriminate, causing the scope of the appeal to be far greater than was necessary.
In addition to her lack of success on the grounds identified above, Ms Mandeville was unsuccessful in her arguments that the trial judge had erred in dismissing her claim for $46,422.25 (being the $124,000 she had paid to Better Lending less the default judgment sum obtained in the first action in the Magistrates Court). She submits that this claim occupied a relatively minor part of the appeal. Nevertheless, it was a substantially independent ground, argued in favour of quite different relief.
In Bell v Deputy Coroner of South Australia (No 2),[11] Blue J reviewed the relevant authorities, including the exposition given by this Court in A, DC v Prince Alfred College Inc (No 2).[12] That exposition included the following:[13]
In adversarial litigation the parties and their legal advisors carry the primary responsibility for ensuring the cost-effectiveness of litigation because they have a particular knowledge and understanding of the controversy, and the available evidence, which the court cannot know because of legal professional privilege.
It is therefore the responsibility of the legal profession to actively consider the affect [sic] of adding doubtful claims, or mounting defences to good claims without any foundation for doing so, on the efficient resolution of the proceedings. In accordance with that duty legal practitioners must give advice on the relative merits of the possible claims and defences and on the cost and time implications of pursuing those claims so that the litigant is in a position to give informed instructions on how to conduct the proceedings.
The authorities to which we have referred make it clear that the rule does not only apply to a ‘precise issue in the technical pleading sense’ but extends to any substantial disputed question of fact or law. There is of course a limit to the dissection of an action which is practicably possible.
On the other hand, the court should not be overly parsimonious in the award of costs to a plaintiff who has won a judgment against a wrongdoer who has denied liability on all of the grounds of the plaintiff’s claim.
There can be no precision in the balancing of the tension between the ordinary rule and its qualification. Much will depend on the extent to which the costs of the litigation of the separate issues can easily be separated out and on the reasonableness of the forensic decision of the successful party to pursue, not only the claims on which he or she succeeded, but also those claims on which he or she failed.
(Emphasis added)
[11] [2020] SASC 77.
[12] [2016] SASCFC 27.
[13] A, DC v Prince Alfred College Inc (No 2) [2016] SASCFC 27 at [9]-[13] (Kourakis CJ, Gray and Peek JJ).

Justice Blue helpfully identified a number of key considerations going to the exercise of the discretion in this kind of circumstance:[14]
Without limiting the factors relevant to the exercise of the discretion, it is more likely to be exercised to make a costs order reflecting mixed success on issues:
·the more separate and distinct the issue(s) on which the successful party failed (a separateness assessment);
·the greater the proportion of costs of the issue(s) on which the successful party failed out of total costs (a relativity assessment);
·the greater the costs of the issue(s) on which the successful party failed (an absolute assessment);
·the less the merit of the successful party’s case on the unsuccessful issue(s) (a merit assessment).[15]
(Footnotes in original)
[14] Bell v Deputy Coroner of South Australia (No 2) [2020] SASC 77 at [20].
[15] See Australian Trade Commission v Disktravel [2000] FCA 62 at [3] per French, Kiefel and Mansfield JJ; Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107 at [3]-[6] per Finkelstein and Gordon JJ.
As this Court recently said in Amaca Pty Ltd v Werfel (No 2):[16]
Indeed, it has been said in recent times that courts are more readily prepared to modify the general approach, and to make orders having regard to “issues”, because the interests of justice sometimes require a reduction in the costs that might otherwise be awarded to a successful party where that party has failed on particular, disputed questions of fact or law.[17] That approach is at times more readily apparent in cases where the issues which have been raised, and on which the successful party has failed, can be said to have unduly extended the time and expense of the litigation.[18] That will be particularly so if there is, in addition, some sort of misconduct relating to the issue or the litigation more generally.[19]
(Footnotes in original)
[16] [2021] SASCFC 26 at [62].
[17] Cretazzo v Lombardi (1975) 13 SASR 4, 12 (Bray CJ); GT Corp Pty Ltd v Amare Safety Pty Ltd [2008] VSC 296, [31] (Robson J).
[18] Victoria v Master Builders Association Victoria (Victorian Court of Appeal, Ormiston JA, 15 December 1994); Mickelberg v State of Western Australia [2007] WASC 140, [30]-[35] (Newnes J) and A, DC v Prince Alfred College Inc (No 2) [2016] SASCFC 27, [11]-[13] (Kourakis CJ, Gray and Peek JJ).
[19] Oshlack v Richmond River Council (1998) 193 CLR 72, [69] (McHugh J), Monier Ltd v Metalwork Tiling Co of Australia Ltd (No 2) (1987) 43 SASR 588, 590; Ruddock v Vadarlis (No 2) (2001) 115 FCR 229, [11] (Black CJ and French J).
In this case, there is no suggestion of misconduct in the conduct of the appeal. However, while Ms Mandeville succeeded on the appeal, a considerable part of her appeal was devoted to issues and arguments that were either unnecessary or on which she was unsuccessful. That should be reflected in the costs order, although the weighting should be in her favour.
On the cross appeal, there is no reason of principle to depart from the general rule that costs should follow the event. However, it would be artificial and counterproductive in this case to distinguish between the appeal and cross-appeal for the purposes of costs orders in the appeal proceedings. Using a broad-axe approach, Better Lending should pay 80 per cent of Ms Mandeville’s costs of the appeal and cross appeal.
The costs of Action 83 of 2016
Action 83 of 2016 was referred to in the appeal judgment as the ‘second action’. The effect of the appeal judgment is that the only monetary claim on which Ms Mandeville has not been successful in that action is the claim for $46,422.25. That action includes both Ms Mandeville’s claim and the now‑dismissed counterclaim, on which Better Lending had been partially successful at trial.
In his unpublished judgment on costs dated 20 February 2020, the primary judge, having observed the key relevant factors informing the costs discretion at trial, observed:
There are other relevant considerations;
·Deborah Mandeville failed on the res judicata and issue estoppel arguments advanced at a separate pre-trial hearing.
·Deborah Mandeville failed at trial on a number of issues, namely anshun estoppel; abuse of process; and duress, undue influence or unconscionable conduct. The latter composite issue was a significant evidentiary one, upon which I did not accept the evidence of Deborah Mandeville.
The judge’s rejection of the claims of duress, undue influence and unconscionable conduct was significant in his Honour’s decision to order Better Lending to pay only 80 per cent of Ms Mandeville’s costs on a party/party basis. The rejection of those claims was not the subject of appeal. However, Ms Mandeville has now had greater success than at trial.
Having regard to the fact that Ms Mandeville has improved her position on appeal with the dismissal of the Counterclaim, and exercising the broad discretion of the Court under s 40 of the Supreme Court Act 1935 (SA), Better Lending should pay 90 per cent the costs of Ms Mandeville in Action 83 of 2016. Orders made as to costs in the course of those proceedings should be unaffected.
Indemnity or solicitor/client costs
Ms Mandeville seeks an order that the respondent pay her costs of Action 83 of 2016 on an indemnity or, alternatively, on a solicitor/client basis. The appellant contends that Better Lending had imprudently refused offers of compromise and that, properly advised, it should have known that it had no chance of success.
Ms Mandeville first relied on the correspondence she sent to Better Lending on 31 March 2015.[20] This correspondence preceded and did not express contemplation of the second action. It was contingent on her securing refinancing of the family home at Scoresby. It does not provide a basis for departing from the ordinary position.
[20] [2021] SASCA 28 at [22].
Ms Mandeville further submitted to this Court that ‘it was or should have been obvious to the respondent then that it would fail to do better, given Anshun and the NCCPA defences available to the appellant’, having particular regard to an open letter from her solicitors to the solicitors for Better Lending, dated 25 June 2015. That letter sought an undertaking that Better Lending would take no further action with regard to the warrant of seizure and sale.
This submission is without merit. The issues were complex. Their resolution was not obvious. Ms Mandeville relies on paragraph 63.3 of the letter as putting Better Lending on notice of a defence of Anshun estoppel. That paragraph does no such thing. It refers to Better Lending being estopped from arguing that there are any further amounts payable. It does not distinguish between res judicata, issue estoppel, Anshun estoppel or the Magistrates Court Rules, all of which Ms Mandeville relied on to this end at trial and on appeal.
The same letter did assert breaches of the NCCPA. However, there is nothing about the nature of this claim as then notified, and then being pursued at trial successfully, that warrants costs being awarded other than on the usual basis. The letter does not establish an imprudent refusal of an offer to compromise.[21]
[21] See Colgate-Palmolive Co v Cussons (1993) 46 FCR 225 at 233.
The second letter Ms Mandeville relies on is also dated 25 June 2015. This was expressed to be ‘without prejudice save with respect to costs’. It reiterated the request for the undertaking on the basis set out in the first letter of the same date. It included the following statement:
We are instructed to indicate on a without prejudice basis that, should that undertaking be provided, Deborah Mandeville will then consider her position, including whether she is able or willing to make a further offer to your client with respect to the repayment of the Advances.
The letter emphasised that Ms Mandeville would not negotiate further until the threat to the sale of the residence was removed. The ‘offer’ contained little meaningful content. This letter does not advance Ms Mandeville’s position on her application for a departure from party/party costs.
On 4 November 2015, Ms Mandeville offered to accept a payment from Better Lending of $38,000 in full and final settlement of all claims between the parties, on account of costs and expenses incurred to date. Her solicitor explained the offer as follows:
The rationale for this offer is that it accounts for the costs and expenses, including legal costs, to which Ms Mandeville has been put to respond to the wrongful actions of Better Lending as documented in previous correspondence and in the draft particulars of claim forwarded to your office by email dated 19 October 2015 (Particulars). As such, we anticipate that this offer will not be repeated, as Ms Mandeville’s position will, subject to any further arguments put by you, likely always be that she should at the absolute minimum recover legal costs on a full indemnity basis from Better Lending. As the matter progresses, those costs will obviously increase and, accordingly, Ms Mandeville’s claim against Better Lending will also increase.
This letter communicated, clearly enough, that the offer was to address Ms Mandeville’s costs to date on an indemnity basis and in addition, other ‘costs and expenses’. Ms Mandeville’s costs of trial and appeal will now undoubtedly have well exceeded the sum of $38,000. However, an offer to accept what appears to have amounted to a full indemnity for everything spent to date, on the premise that Ms Mandeville would always be entitled to indemnity costs ‘at an absolute minimum’ was not realistic. It conveyed no compromise. It was not unreasonable for Better Lending to reject the offer.
On 14 August 2018, Ms Mandeville’s solicitors wrote to Better Lending’s solicitors offering terms that, relevantly, discharged Ms Mandeville from all further obligations. Those terms included that Better Lending pay Ms Mandeville’s costs in all actions on a solicitor/own client basis. Then:
In consideration of the above, Deborah Mandeville will discontinue all of her claims and actions against Better Lending in actions 83 and 84 of 2016, and she will allow Better Lending to retain the $124,000 that she paid to it on 2 April 2015.
Again, it was not realistic to maintain that Ms Mandeville was entitled to solicitor/client costs on a global basis (now without identifying the amount of those costs) and to condition the offer on that premise. For the same reasons as we have given in respect of the previous offer, this letter does not warrant departure from the general rule.
The appellant’s further submissions in support of costs being on a solicitor/client basis extend to submissions such as that the appellant’s case on Anshun estoppel was ‘overwhelming’ and that ‘[a]ny solicitor properly advising the respondent would have advised that the appellant’s Anshun estoppel defence would succeed’. The reasons given in the judgment on appeal demonstrate the unsustainability of these contentions which, in any event, pay no regard to the numerous issues on which Ms Mandeville did not succeed. The Court is not assisted by this kind of hyperbole.
There is no basis to depart from the ordinary principle that costs should be awarded on a party/party basis.
The sum of $20,000 standing to the credit of Action 84 of 2016
On 4 June 2018, in Action 84 of 2016, the Chief Judge ordered that Better Lending provide security for costs by payments into the Suitor’s Fund totalling $20,000. Better Lending made those payments. Ms Mandeville seeks an order that the sum of $20,000 standing to the credit of Action 84 of 2016 be paid out of Court to her.
Better Lending’s opposition to this course is limited to contending that this sum should remain in the Suitor’s Fund, pending the outcome of its application for Special Leave to appeal or a full accounting and reconciliation. For the reasons given above with respect to Better Lending’s application for a stay of execution of orders, that sum should be paid out of Court to Ms Mandeville.
The Court orders as follows:
1.Better Lending is to pay 80 per cent of Ms Mandeville’s costs of the appeal and cross appeal, on a party/party basis.
2.The order of the District Court in Action No. 83 of 2016 on 20 February 2020, that Better Lending pay 80 per cent the costs of Ms Mandeville in Action 83 of 2016, on a party/party basis, is set aside.
3.Better Lending is to pay 90 per cent the costs of Ms Mandeville in Action 83 of 2016, on a party/party basis.
4.The sum of $20,000 standing to the credit of Action 84 of 2016 in the Suitor’s Fund is to be paid out of Court to the Trust Account of Ms Mandeville’s solicitors.