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McLaughlin v Dungowan Manly Pty Ltd

McLaughlin v Dungowan Manly Pty Ltd

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Case Copied 20 April 2010 40 min read

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CITATION: McLaughlin v Dungowan Manly Pty Limited [2010] NSWSC 306

HEARING DATE(S): 15 April 2010

JUDGMENT DATE :
20 April 2010

JURISDICTION: Equity Division

JUDGMENT OF: Ward J

DECISION: 1. Dungowan Manly Pty Limited pay the McLaughlins’ costs of the proceedings.
2. Mr Garratt pay the McLaughlins’ costs of the application brought by him to set aside in whole or in part the subpoena to produce which was issued by the McLaughlins on 25 May 2009 in these proceedings.

CATCHWORDS: COSTS – multiple issues in proceedings – plaintiffs successful on some claims – principles relating to departure from general rule that costs follow the event and where apportionment of costs to reflect outcome on separate issues if appropriate – plaintiffs’ unsuccessful claims did not add substantially to length of hearing or were relevant to an understanding of other matters in issue which were argued successfully – no apportionment of costs referable to separate issues in the proceedings – DERIVATIVE PROCEEDINGS – minority shareholders’ claim for an order that company bear costs of derivative proceedings in advance of commencement of those proceedings – no order made

LEGISLATION CITED: Civil Procedure Act 2005 (NSW)
Supreme Court Rules 1970 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)

CATEGORY: Separate question

CASES CITED: Access Courier Systems Pty Limited v Hunsat Pty Limited [2009] NSWSC 507
Bowen Investments Pty Limited v TAB Corp Holdings Limited (No 2) [2008] FCAFC 107
Carpenter v Pioneer Park Pty Limited [2004] NSWSC 1007
Corbett Court Pty Limited v Quasar Constructions (NSW) Pty Limited [2008] NSWSC 1423
Cretazzo v Lombardi (1975) 13 SASR 4
Dodds Family Investments Pty Limited v Land Industries Pty Limited (1993) 26 IPR 261
Ehsman v Nutectime International [2006] NSWSC 887, at [62]; (2006) 58 ACSR 705
Elite Protective Personnel Pty Limited v Salmon (No 2) [2007] NSWCA 322
Elite Protective Personnel Pty Limited v Salmon (No 2) [2007] NSWCA 373
Fexuto v Bosnjak Holdings Pty Limited (No 3) (1998) 30 ACSR 20
Fiduciary Ltd v Morningstar Research Pty Limited [2005] NSWSC 442; (2005) 53 ACSR 732, (2005) ACLC 1100
Foyster v Foyster Holdings Pty Limited [2003] NSWSC 135; (2003) 44 ACSR 705
Hodge v TCN Channel 9 (No 2) [2006] NSWSC 1272
Hughes v Western Australian Cricket Association (1986) ATPR 40-748
James v Surf Road Nominees (No 2) [2005] NSWCA 296
Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534; (1990) 97 ALR 45
Maher v Honeysett & Maher Electrical Contractors [2005] NSWSC 859
Ohn v Walton (1995) 36 NSWLR 77
Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72; (1998) 152 ALR 83
Pacific General Securities Limited v Soliman & Sons Pty Limited [2006] NSWSC 724
Reale v Duncan Reale [2006] NSWSC 199
Roach v Winnote Pty Limited; Leslie & Anor [2006] NSWSC 231; (2006) 57 ACSR 138
Sabah Yazgi v Permanent Custodian Limited (No 2) [2007] NSWCA 306
Short v Crawley (No 40) [2008] NSWSC 1302
Standard Commodities Pty Limited v…

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: [2010] NSWSC 306
Decision Date: 20 April 2010

CaseChat Overview and Summary

The proceedings involved a dispute between the plaintiffs, McLaughlin, and the defendant, Dungowan Manly Pty Ltd, concerning costs in relation to derivative proceedings. The plaintiffs sought to have the defendant bear the costs of derivative proceedings in advance of their commencement. The matter was heard in the Supreme Court of New South Wales. The legal issues before the court included whether the costs should be apportioned to reflect the outcome on separate issues in the proceedings and whether the plaintiffs' unsuccessful claims warranted an order for the defendant to bear the costs of the derivative proceedings in advance.

The court considered the principles relating to the general rule that costs follow the event and whether apportionment of costs was appropriate in this case. The court noted that the plaintiffs' unsuccessful claims did not add substantially to the length of the hearing or were not relevant to an understanding of other matters in issue that were argued successfully. Consequently, the court determined that no apportionment of costs referable to separate issues in the proceedings was warranted. Regarding the derivative proceedings, the court held that no order should be made for the defendant to bear the costs in advance, as the plaintiffs did not succeed in establishing a basis for such an order.

The court's reasoning and outcome resulted in a decision that no apportionment of costs was necessary, and no order was made for the defendant to bear the costs of derivative proceedings in advance. The final orders reflected the court's determination on these issues.

Orders