McIntyre v Quality Roofing Services Pty Ltd (No 2) - [2019] SASCFC 69

Supreme Court of South Australia
(Full Court: Civil)
MCINTYRE & ANOR v QUALITY ROOFING SERVICES PTY LTD (No 2)
[2019] SASCFC 69
Judgment of The Full Court
(The Honourable Justice Parker, The Honourable Justice Lovell and The Honourable Auxiliary Justice Tilmouth)
26 June 2019
PROCEDURE - COSTS - DEPARTING FROM THE GENERAL RULE - OTHER CASES
The appellants seek orders for costs to follow the event having largely succeeded in setting aside a judgment against them, entered by a District Court Judge.
Held: As the appellants have a reasonable expectation of a favourable costs order and that the respondent did not succeed on any particular issue, costs should follow the event. Discussion as to the proper disposition of costs issues in related proceedings before the Environmental, Resources and Development Court.
Supreme Court Civil Rules 2006 (SA) r 263(1), r 264(1); Supreme Court Act 1935 (SA) s 40(1); McIntyre & Anor v Quality Roofing Services Pty Ltd [2019] SASCFC 29; Copping and Others v ANZ McCaughan and Another; Tillett Nominees Pty Ltd and Others (1995) 63 SASR 523; Cretazzo v Lombardi (1975) 13 SASR 4; Latoudis v Casey (1990) 170 CLR 534; Forlyle Pty Ltd v Tiver (2007) 252 LSJS 387; Australian Trade Commission v Disktravel [2000] FCA 62; Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107; Oshlack v Richmond River Council (1998) 193 CLR 72; Anderson v Bowles (1951) 84 CLR 310; Gray v Sirtex Medical Ltd (2011) 193 FCR 1; Avenhouse v Hornsby Shire Council (1998) 44 NSWLR 1; Hamdorf v Riddle [1971] SASR 398, referred to.

MCINTYRE & ANOR v QUALITY ROOFING SERVICES PTY LTD (No 2)
[2019] SASCFC 69
Full Court: Parker and Lovell JJ and Tilmouth AJ

PARKER J: I agree with the reasons of Tilmouth AJ and the orders he proposes.
LOVELL J: I agree with the reasons of Tilmouth AJ and the orders he proposes.
TILMOUTH AJ:
The issues
This matter returns to the court for determination of the appropriate costs orders following the judgment of this Court allowing the McIntyres’ appeal, delivered on 3 April 2019.[1]
[1] McIntyre & Anor v Quality Roofing Services Pty Ltd [2019] SASCFC 29.
The appellants seek an order for costs to ‘follow the event’ pursuant to SCR 263(1) of the Supreme Court Civil Rules 2006 (SA). In contrast, the respondents argue for costs assessed on an ‘issues by issues basis’, limited to the discrete issues on which the appellants succeeded.
The orders pronounced by this Court on 3 April 2019 were these:
1.     The judgment in favour of Quality Roofing Service for $27,403 is set aside;
2.     The order dismissing the McIntyres’ cross-action is set aside;
3.     The orders for interest against the McIntyres are set aside;
4.The order in favour of Quality Roofing Service for the costs of the Environment, Resources and Development Court action are set aside;
5.     The costs orders in favour of Quality Roofing Service are set…

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.

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Details

Case: [2019] SASCFC 69
Decision Date: 26 June 2019

CaseChat Overview and Summary

In McIntyre v Quality Roofing Services Pty Ltd (No 2), the Full Court of the Supreme Court of South Australia considered subsidiary orders sought by the appellants for an interim judgment of $12,000 and for recovery of their costs incurred in the ERD Court as damages on an indemnity basis. The dispute arose from a prior proceeding in the ERD Court.

The primary legal issues before the Full Court were whether the appellants could recover the costs they incurred in the ERD Court as damages in the current proceedings, and whether an interim judgment for $12,000 should be awarded. The court also considered a request to correct an error in the primary judgment under the slip rule.

The court reasoned that questions concerning costs paid pursuant to orders of the ERD Court were matters for determination by a District Court Judge by way of damages for breach of contract. However, the court affirmed the well-established policy that the costs of legal proceedings are ordinarily not recoverable as damages in other proceedings, citing *Anderson v Bowles* and *Gray v Sirtex Medical Ltd*. The court noted that the ERD Court needed to finalise all outstanding issues of costs in that court before these matters could be fully considered by the District Court Judge.

The Full Court ordered that the appellants recover their costs of the appeal on a party and party basis. It further ordered that the question of whether costs orders made by the ERD Court sounded in damages be heard by a District Court Judge once the ERD Court determined the incidence of costs in its proceedings. Finally, by consent under the slip rule, the court corrected an error in the primary judgment by substituting $27,903 for $27,403.

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

Subsidiary orders are sought awarding the appellants an ‘interim judgment’ for $12,000, as well as orders that they recover their costs incurred in the ERD Court as damages, on an indemnity basis. It follows from the above analysis that questions of costs paid by either party pursuant to orders of the ERD Court of 10 December 2016,[13] including those to the District Council of Charles Sturt, are matters for consideration by the District Court Judge by way of damages for breach of contract. Even then it does not follow that because an adverse costs order was made against a party in one proceeding, that it can be recovered against the opposing party in subsequent proceedings. On the contrary, there is a well-established policy that ordinarily costs of legal proceedings are not recoverable as damages in other proceedings: Anderson v Bowles,[14] and see Gray v Sirtex Medical Ltd.[15] A situation bearing some parallels to the present is to be found in Avenhouse v Hornsby Shire Council.[16] These are questions for the District Court Judge to determine after the ERD Court finalises all outstanding issues of costs in that Court.[13] CB5, p 249.[14] (1951) 84 CLR 310, 323.[15] (2011) 193 FCR 1, [15]-[18] per Bennett, Gilmour and Gordon JJ.[16] (1998) 44 NSWLR 1, 33F-37C.Conclusion and Orders For the above reasons the following orders are proposed:1.The appellants have their costs of and incidental to the appeal, taxed on a party and party basis.2.The question whether costs orders made by the ERD Court sound in damages, be heard by a District Court Judge, once the ERD Court determines the incidence of costs of the proceedings in the ERD Court.3.There will be an order by consent under the slip rule (SCR 342(1)), correcting order 1 of the primary judgment, by deleting the amount of $27,403 therein and substituting in lieu thereof the sum of $27,903.

Ratio Decidendi

Legal Principle Established

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