Mark Ian Blankfield v Victorian Managed Insurance Authority (costs)

[2024] VCC 1548

IN THE COUNTY COURT OF VICTORIA

AT MELBOURNE

COMMERCIAL DIVISION

Revised
(Not) Restricted
Suitable for Publication

BUILDING CASES LIST

Case No. CI-23-05445

Mark Ian Blankfield	First Plaintiff
and
Hilary Blankfield	Second Plaintiff
and
Owners Corporation PS829995A	Third Plaintiff
v
Victorian Managed Insurance Authority	Defendant

---

JUDGE:	His Honour Judge Anderson
WHERE HELD:	Melbourne
DATE OF HEARING:	Written submissions dated 24 September 2024
DATE OF RULING:	7 October 2024
CASE MAY BE CITED AS:	Mark Ian Blankfield & Ors v Victorian Managed Insurance Authority (costs)
MEDIUM NEUTRAL CITATION:	[2024] VCC 1548

RULING
---

Subject:COSTS

Catchwords:              Costs of summons by defendant seeking to file an amended defence – Application to amend withdrawn before hearing – Plaintiffs’ costs of summons ordered to be costs in the cause

---

APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Noble Lawyers
For the Defendant	Moray & Agnew

HIS HONOUR:

1On 3 July 2024, the defendant filed a summons seeking leave to file an amended defence.  As a result of the delay in the hearing and determination of the summons, it was also necessary to reset the timetable for pre-trial processes.

2The defendant’s solicitors recently indicated that they would withdraw their application to file an amended defence.

3The Court was then asked by the parties to determine two remaining matters on the papers:

(a)   the terms of the reset timetable, most of which the parties had resolved. There were two disputed dates that the Court was asked to fix;

(b)   whether an order should be made that the defendant pay the plaintiffs’ costs of the defendant’s summons.

4The parties filed written submissions. The timetable for the pre-trial steps is now agreed. The only issue remaining relates the plaintiffs’ costs of the summons.

5The proceeding arises out of the construction of an apartment building. The plaintiffs are owners of apartments and the body corporate. They allege the construction of the building was defective when a certificate of practical completion was issued on 17 February 2020.

6The builder is now insolvent. The defendant is an insurer against whom the claim was made by writ issued on 6 October 2023.

7The claim is substantial and complicated. The defendant says that it has obtained over 23 expert reports in relation to the defective works. One of the experts is Nicholas Warton who prepared a supplementary report dated 12 March 2024. In this report, Mr Warton changed opinions he had earlier expressed, apparently after reading a report from “Intracon”.

8On 8 May 2024, the plaintiffs’ solicitors wrote to the defendant’s solicitors advising that, if the defendant wished to rely on Mr Warton’s changed opinions, the defendant would need to amend its defence. This led to the issue of the summons by the defendant on 3 July 2024.

9Further correspondence ensued between the parties and, apparently, attempts to resolve the disputes between the parties. The defendant says in written submissions dated 24 September 2024, “with a view to limit the issues in dispute and to avoid further costs to the parties, the Defendant has now withdrawn its Summons”.

10The submissions continued, “The Defendant has attempted to engage in negotiations to resolve the proceeding and has requested the Plaintiffs on multiple occasions to put the Summons in abeyance to allow the parties to focus on negotiating a resolution of the dispute”. The plaintiffs’ solicitors submitted that the reference to negotiations “ought not to be the subject of submission to the court”.

11I do not see any harm in a party referring generally to the fact that negotiations between the parties are continuing, provided that no detail of any negotiations were disclosed. I note that in the order made by Judge Kirton on 11 September 2024, Her Honour noted in paragraph D of Other Matters that the defendant’s solicitors had sought in correspondence that day to have its summons dated 3 July 2024 held in abeyance for two reasons, one of which was to “[a]llow the parties to focus on the resolution of the dispute while avoiding the costs associated with the summons”.

12The plaintiffs’ solicitors submit that there are no circumstances that have been shown as to why the usual order that “costs should follow the event” should not be made.

13The defendant’s solicitors submit that “the parties’ costs in relation to the Summons should be determined costs in the cause”.

14In my view, the appropriate order is that the plaintiffs’ costs of and incidental to the defendant’s summons dated 3 July 2024 should be costs in the cause. By Rule 63A.20.1, the general rule is that, unless stated otherwise, costs ordered on an interlocutory application should not be taxed until the proceeding in which the order is made is completed. In this instance, the defendant would never recover its costs of the summons, even if successful in the proceeding. The plaintiffs would recover, if they are successful.

15The orders I shall make on the defendant’s summons dated 3 July 2024 are as follows:

1.    The defendant’s summons dated 3 July 2024 is struck out (it being noted that the defendant informed the Court that it withdraws its summons).

2.    The hearing listed on 25 September 2024 for the hearing of the summons, by order of Judge Kirton made 11 September 2024, is vacated.

3.    The orders of Her Honour Judge Kirton dated 8 November 2023 are confirmed, including the trial date of 12 February 2025 (with an estimated hearing of 8 sitting days), save for the following changes to the orders that have been agreed by the parties:

Expert Evidence

4.    the date by which the experts shall meet for the purposes of conducting an expert conference and to prepare a joint report in accordance with Replaceable Order G.13B is extended to 7 October 2024 (Order 17).

5.    the date by which the plaintiffs must file and serve the joint report in accordance with Replaceable Order G.13B(12) is extended to 14 October 2024 (Order 18).

Witnesses – form of lay evidence

6.    the date by which the parties must file and serve their witness statements is extended to 18 October 2024 (Order 20).

7.    the date by which the parties must file and serve their witness statements in reply is extended to 1 November 2024 (Order 21).

Subpoenas

8.    the date by which each party’s solicitors must issue any Form 42AA subpoenas under Order 42A of the Rules is extended to 18 October 2024 Order 27).

9.    the date by which each party’s solicitors must issue any Form 42B subpoenas under Order 42 of the Rules is extended to 18 October 2024 (Order 28).

Court books and trial aids

10. the date by which the plaintiffs must serve a proposed court book index on the other parties is extended to 29 November 2024 (Order 32).

11. the date by which the other parties must respond with any requested additions to the court book by providing a marked-up court book index is extended to 6 December 2024 (Order 33).

12. the date by which the plaintiffs must file and serve the electronic court book is extended to 20 December 2024 (Order 34).

13. The plaintiffs’ costs of and incidental to the defendant’s summons dated 3 July 2024 shall be costs in the cause.

14. Reserve liberty to apply.

- - -

Certificate

I certify that these 4 pages are a true copy of the ruling of his Honour Judge Anderson delivered on 7 October 2024.

Dated: 7 October 2024

Associate to his Honour Judge Anderson