McNamara Business & Property Law v Kasmeridis (No 3)

[2006] SASC 262

SUPREME COURT OF SOUTH AUSTRALIA

(Civil)

MCNAMARA BUSINESS & PROPERTY LAW v KASMERIDIS (No 3)

[2006] SASC 262

Judgment of The Honourable Justice Gray

24 August 2006

PROCEDURE - COSTS

Consideration of question of costs in relation to an application for charging and Mareva orders - applicant to pay respondents' costs to be taxed - costs recoverable forthwith.

Supreme Court Rules 1987 r 101.01(7), referred to.
McNamara Business & Property Law v Kasmeridis (No 2) [2006] SASC 167; Alstom Power Ltd v Yokogawa Pty Ltd & Ors (No 2) [2006] SASC 87, considered.

MCNAMARA BUSINESS & PROPERTY LAW v KASMERIDIS (No 3)
[2006] SASC 262

Civil

GRAY J:

1. In McNamara Business & Property Law v Kasmeridis (No 2),[1] I dismissed applications for charging and Mareva orders.  I reached the conclusion that the application for charging orders was misconceived.  With respect to the application for the Mareva injunction, I concluded that the court had jurisdiction to grant a Mareva injunction.  However, I declined to exercise my discretion to do so.

   [1] McNamara Business & Property Law v Kasmeridis (No 2) [2006] SASC 167.

2. The respondents, Mr and Mrs Kasmeridis, seek costs of the applications on a solicitor-client basis and an order that those costs be paid forthwith.  The appellant, McNamara Business and Property Law, does not oppose an order for party-party costs, but resists an order for solicitor-client costs and an order that any costs be paid forthwith.

3. Counsel for the Kasmeridis submitted that both applications were doomed to fail and that, in those circumstances, solicitor-client costs should be ordered.  Counsel contended that the hopelessness of the applications demonstrated that they were advanced for some ulterior purpose, thereby justifying special orders as to costs.

4. Counsel for McNamara Business & Property Law submitted that difficult questions of construction arose under the Enforcement of Judgments Act 1991 (SA) and that although ultimately the application for a charging order was unsuccessful, it was incorrect to describe the application as obviously hopeless and of such a nature as justified solicitor-client costs. In respect to the application for a Mareva injunction, counsel pointed out that the Kasmeridis had unsuccessfully challenged the jurisdiction of the Court to grant a Mareva injunction and that, having regard to the disposal of properties by the Kasmeridis, it had not been inappropriate to seek an order.

5. In my opinion, this is not the case for ordering solicitor-client costs.  Although I concluded that the Enforcement of Judgments Act provisions could not be invoked, I do not consider that it has been established that the application was issued for some ulterior purpose.  The application for a Mareva injunction invoked the jurisdiction of the Court correctly and raised issues for determination.  It is to be noted that the Kasmeridis unsuccessfully challenged the Court’s jurisdiction.  In these circumstances, I decline to order that costs be awarded on a solicitor-client basis.

6. The Rules of Court provide this Court with unfettered discretion to order payment of costs in interlocutory proceedings before the conclusion of the principal proceeding.  Rule 101. 01(7) provides:

   An order for costs of an interlocutory proceeding shall not, unless the Court otherwise orders, entitle a party to have a bill of costs taxed until the principal proceeding in which the interlocutory order was made is concluded or further order.

7. The party seeking an order that costs be paid forthwith needs to satisfy the Court that the justice of the case calls for an order for immediate payment.  Factors relevant to the exercise of the discretion include the following:

   -whether an interlocutory proceeding involves a discrete issue that may not be resolved for a lengthy period;

   -whether the interlocutory application has resolved part of the substantive claim;

   -whether the interlocutory proceeding has been used inappropriately;

   -whether an order for payment forthwith may stultify the proceedings;

   -whether an order for immediate payment would preclude an offsetting of costs orders.[2]

   This list of factors may not be exhaustive.  The Court must arrive at a conclusion that is just after the relevant factors that arise in the particular case have been assessed and weighed.

   [2] See Alstom Power Ltd v Yokogawa Pty Ltd & Ors (No 2) [2006] SASC 87.

8. In the present case both applications are discrete from the substantive proceedings.  As indicated in McNamara Business & Property Law v Kasmeridis (No 2), this matter has a long history.  There is a real risk that the substantive proceedings will be protracted.  In all the circumstances, I consider that an order should be made that the costs of the applications be payable forthwith.

9. The order of the Court is that McNamara Business & Property Law pay the Kasmeridis’ costs of the applications for charging orders and a Mareva injunction to be taxed.  Once taxed, the costs are recoverable forthwith.