Melrob Investments Pty Ltd & Ors v Blong Ume Nominees Pty Ltd & Ors (No 2)
[2024] SASCA 34
•25 March 2024
SUPREME COURT OF SOUTH AUSTRALIA
(Court of Appeal: Civil)
MELROB INVESTMENTS PTY LTD & ORS v BLONG UME NOMINEES PTY LTD & ORS (No 2)
[2024] SASCA 34
Judgment of the Court of Appeal
(The Honourable Justice Lovell, the Honourable Justice Bleby and the Honourable Justice David)
25 March 2024
APPEAL AND NEW TRIAL - PROCEDURE - SOUTH AUSTRALIA - POWERS OF COURT - COSTS
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - TIME FOR COSTS ORDERS TO BE MADE - TIME FOR APPLICATIONS TO VARY COSTS ORDERS
This is an interlocutory application brought by the appellants seeking to vary a judgment and/or re-open an appeal to clarify a costs order made by the Court of Appeal.
The respondents commenced an action in 2013. In 2017, Parker J dismissed the claim. The respondents appealed against some of Parker J’s findings. In December 2019, the Full Court allowed the appeal and remitted certain issues for hearing and determination before a single judge of this Court.
In March 2021, Kourakis CJ determined the remitted issues in favour of the respondents. On 21 May 2021, he determined the application for the costs of the trial before Parker J in favour of the respondents. On 7 April 2022 this Court allowed an appeal from Kourakis CJ on those remitted issues. The appellants applied for their ‘costs of the appeal’. The Court ordered that the appellants were to have their costs to be agreed or taxed.
Following exchanges between the parties in July and August 2023, a dispute arose as to the parties’ entitlements as to costs. The appellants contended that their success on the appeal extended to the trial proceedings of the remitted issues before Kourakis CJ as well as issues before Parker J. The respondents contended that the Court of appeal had made no orders to that effect.
Held (by the Court) granting the appellants leave to apply to vary the orders of this Court entered on 8 April 2022:
1.The respondents are to pay the appellant’s costs of the trial on the remitted issues heard by Kourakis CJ.
2.The interests of justice do not favour varying the judgment so as to interfere with the costs order of 21 May 2021.
3. The appellants are to pay the respondents’ costs of this interlocutory application.
Trustee Act 1936 (SA) ss 36, 59C; Corporations Act 2001 (Cth) ss 232, 233, 461; Uniform Civil Rules 2020 (SA) rr 82.2(3), 184.1, 186.1(2), 194.5(2), 195, 213.1(1)(c), referred to.
Bramwell v Bramwell [2023] SASCA 94; Clone Pty Ltd v Players Pty Ltd (in Liq) (2018) 264 CLR 165; Commonwealth v McCormack (1984) 155 CLR 273; Coppins v Helmers & Brambles Constructions Pty Ltd [1969] 2 NSWR 279; Flowers v Finlayson [2021] SASCA 75; L Shaddock & Associates Pty Ltd v Paramatta City Council (No 2) (1982) 151 CLR 590; McAdam v Robertson [1999] SASC 169; McDonald v Attorney-General for the State of South Australia [2022] SASCA 43; Melrob Investments Pty Ltd & Ors v Blong Ume Nominees Pty Ltd & Ors [2022] SASCA 29; Poniatowska v Channel Seven Sydney Pty Ltd (No 4) [2021] SASCFC 32; Raybos Australia Pty Ltd v Tectran Corporation Pty Ltd (1988) 77 ALR 190; Re Inchape (Earl of) [1942] Ch 294; Rowe v Delfs [1966] WAR 49; SkyCity Adelaide Pty Ltd v Treasurer of South Australia (No 2) [2024] SASCA 18; Varnhagen v State of South Australia (No 3) [2022] SASCA 134, considered.
MELROB INVESTMENTS PTY LTD & ORS v BLONG UME NOMINEES PTY LTD & ORS (No 2)
[2024] SASCA 34Court of Appeal – Civil: Lovell, Bleby and David JJA
THE COURT: On 7 April 2022, this Court delivered judgment on the appeal and cross-appeal in this matter.[1] The Court made orders allowing the appeal, dismissing the cross-appeal and dismissing the claims made by the respondents that the Full Court had, on an earlier appeal, remitted for re-hearing. The Court then made costs orders reflecting the application for costs that the successful appellants made following delivery of judgment.
[1] Melrob Investments Pty Ltd & Ors v Blong Ume Nominees Pty Ltd & Ors [2022] SASCA 29.
The appellants have now filed an interlocutory application seeking leave ‘to the extent necessary or appropriate’ to vary the judgment and/or reopen the appeal and, ‘to the extent necessary or appropriate’, to clarify the costs orders made by the Court of Appeal. The interlocutory application sets out the costs orders that the appellants contend should be made by way of variation or clarification.
The interlocutory application is supported by an Affidavit of Lisa Marie Amabili made on 26 October 2023 (‘the first Amabili affidavit’) and a Second Affidavit of Lisa Marie Amabili made on 5 December 2023 (‘the second Amabili affidavit’). Ms Amabili is a solicitor employed by the solicitors for the appellants, Ouwens Lawyers, and has the care and conduct of the matter. Ouwens Lawyers filed a Notice of Acting for the appellants on 25 October 2023. The previous solicitors on the record were Stewart-Rattray Lawyers.
In response to the application, the respondents have filed an Affidavit of Peter David Pedler, the solicitor for the respondents, made on 20 December 2023 (‘the Pedler affidavit’).
The procedural history of this matter is complex. We will refer to the parties at all stages of the proceedings by reference to their present roles as appellants and respondents respectively.
Background
The appeal judgment sets out the history of this matter in brief.[2] The respondents commenced the action in 2013. In 2017, Parker J dismissed the claim. The respondents appealed in respect of several but not all of the findings of Parker J. On 10 December 2019, the Full Court allowed the appeal and remitted certain specific issues for hearing and determination.
[2] Melrob Investments Pty Ltd & Ors v Blong Ume Nominees Pty Ltd & Ors [2022] SASCA 29 at [3]-[18].
The parties reached agreement on most of the remitted issues. Two issues remained outstanding:
·the respondents’ claims for the removal of the trustee of the Trust and/or winding up of the Trust pursuant to ss 36 and 59C of the Trustee Act 1936 (SA); and
·the respondents’ claims for remedies under ss 232, 233 and 461 of the Corporations Act 2001 (Cth) (‘Corporations Act’).
Kourakis CJ gave judgment on these remitted issues on 3 March 2021. As to the first issue, his Honour held that the criteria under s 59C of the Trustee Act were met for the revocation of the trust, and the distribution of the proceeds to the beneficiaries. He considered that it was not necessary to determine the second issue. He indicated, however, that in the event the power conferred under s 59C was not enlivened, he would nevertheless have exercised powers to wind up the Trustee, with consequential orders to the same effect as he proposed.
On 25 March 2021, the respondents filed a draft order to give effect to Kourakis CJ’s judgment (FDN 136 in the trial proceedings). On 15 April 2021, the Court generated draft minutes of order in similar terms (FDN 140) and Kourakis CJ made the following order:
1.The orders as set out in the draft minutes of order (FDN 140) are granted.
Relevantly, those orders included the following orders as to costs:
4.The [appellants] pay the [Trustee’s] costs of the remitted hearing before the Honourable Chief Justice, such costs to be taxed or agreed on a standard costs basis.
5.The [appellants] pay the [respondents] costs of the remitted hearing before the Honourable Chief Justice, such costs to be taxed or agreed on a standard costs basis.
6.The [appellants] file and serve written submissions on the issue of the costs of the proceedings before the learned Justice Parker, and the issue of whether Justice Parker or the Honourable Chief Justice shall determine that issue, within 7 days.
7.The [respondents] file and serve written submissions on the issue of the costs of the proceedings before the learned Justice Parker, and the issue of whether Justice Parker or the Honourable Chief Justice shall determine that issue, within 7 days thereafter.
Kourakis CJ determined the issue of the costs of the trial before Parker J on 21 May 2021. The appellants argued that the respondents should only be awarded 60 per cent of their costs of that trial, on the basis that the respondents had failed on certain issues. However, his Honour held that the issues on which the respondents did not succeed were inextricably connected to the matters on which they did succeed and that it was not appropriate to differentiate between issues in the award of costs. On that basis, he ordered that the appellants were to pay the respondents’ costs of the trial before Parker J to be agreed or taxed.
On 7 April 2022, this Court allowed the appeal from the judgment of Kourakis CJ on the remitted issues. It made the following orders:
1.The appeal is allowed.
2.The cross-appeal is dismissed.
3.The claims made by the respondents remitted to the primary judge for re‑hearing are dismissed.
On that occasion, counsel for the appellants made an oral application for costs in the following terms:
I make three applications for costs and that is costs of the appeal, costs of the cross-appeal and costs of the application to amend.
Senior counsel for the respondents did not oppose those applications. The Court made the following orders with respect to costs:
4.The appellants are to have their costs to be agreed or taxed.
5.The respondents to the cross-appeal are to have their costs agreed or taxed.
6.The appellants are to have their costs in relation to the application for the amended grounds agreed or taxed.
The dispute over costs entitlements
On 8 March 2023, some 11 months after the judgment on appeal was delivered, the solicitor for the respondents, Mr Pedler, emailed Mr Stewart‑Rattray advising that he had engaged a costs specialist to prepare an assessment of the respondents’ costs. He advised that he was hopeful of being able to provide something shortly. He observed that ‘it would make sense for the costs awarded against my clients to be resolved at the same time’ and asked if Mr Stewart-Rattray had taken any steps to have those costs assessed.
Mr Pedler emailed Mr Stewart-Rattray again on 6 June 2023, enclosing a letter pursuant to Uniform Civil Rules 2020 (SA) (‘UCR’) r 195, claiming costs of $447,588.30 pursuant to the costs orders of Kourakis CJ.
Mr Pedler’s evidence is that he did not receive a response to either of those communications from Mr Stewart-Rattray.
On 3 July 2023, Ms Amabili responded to Mr Pedler’s letter of 6 June 2023, advising that she now had conduct of the matter on behalf of the appellants. She expressed the view that the respondents’ costs claim was ‘premature’. She said that the consequence of the appellants’ success on the appeal was that ‘the orders sought in the appeal were allowed’. She further asserted that it was a consequence of the appeal that the respondents had failed, and the appellants had succeeded, on the remitted issues ‘as they were before the Honourable Justice Parker’. Noting that the respondents had not challenged certain aspects of Parker J’s decision, she continued:
Having regard to the above matters, we submit that the costs orders of 21 May 2021 relied upon by your clients has been displaced with the consequence that there is no current entitlement to costs. The costs of the trial before the Honourable Justice Parker have yet to be finally determined.
Ms Amabili suggested that ‘the appropriate next step’ was that the matter should be relisted before Parker J to determine the costs of the original trial.
Mr Pedler replied by letter dated 23 August 2023, disputing the matters asserted by Ms Amabili. Specifically, Mr Pedler asserted the following position:
·the Full Court had reserved the costs of the trial before Parker J to the judge who heard the remitted issues;
·following the trial and determination of the remitted issues, Kourakis CJ made an order on 21 May 2021 that the appellants pay the respondents’ costs to be agreed or taxed;
·the Notice of Appeal filed in the Court of Appeal on 27 May 2021 did not expressly challenge the orders of 21 May 2021 with respect to the costs of the trial before Parker J, but only the orders of 15 April 2021. (It should be noted here that the orders of 15 April 2021 included an order that the appellants pay the respondents’ costs of the remitted hearing, to be taxed or agreed on a standard costs basis. The orders also put in place procedural steps for the filing of written submissions on the issue of the costs of the proceedings before Parker J);
·the judgment of the Court of Appeal did not expressly make any order as to costs;
·the Court of Appeal made no order to replace the costs order by Kourakis CJ on 21 May 2021. It also did not make any order for costs of the remitted hearing and no order remitting the matter back to Kourakis CJ.
Mr Pedler concluded by asserting that the orders made by Kourakis CJ on 21 May 2021 continued to stand, as the Notices of Appeal did not challenge the 21 May 2021 costs order, the appellants did not seek leave to appeal against that order and there were no orders made by the Court of Appeal to replace the orders made on 21 May 2021.
Following this correspondence, Ms Amabili recorded her disagreement with the position taken by the respondents and suggested a process for relisting the matter before the Court of Appeal. Mr Pedler maintained that the orders of Kourakis CJ made on 21 May 2021 stood and that the respondents were entitled to institute a taxation process under UCR r 195.2.
This history describes the essential respective positions of the parties, upon which each elucidated in oral and then written submissions on the interlocutory application filed by the appellants.
It is necessary to record the effect of some further evidence before this Court on the interlocutory application. In the second Amabili affidavit, Ms Amabili said:
6.The Appellants succeeded in the appeal and did not even contemplate otherwise than that success meant that the costs order of his Honour Chief Justice Kourakis on the remitted trial was set aside and replaced with the order that the Appellants have their costs of that trial.
7.It was not until I received Mr Pedler’s letter of 23 August 2023 … that the Appellants (through me) ascertained that the Respondents were asserting that they were entitled to the entire costs of the proceedings at first instance including the remitted proceedings before his Honour Chief Justice Kourakis.
8.The delay in making the Application is because the Appellants did not consider that the Application was necessary (and, respectfully, still continue to contend that it is unnecessary).
Mr Pedler had, however, particularised his clients’ costs claim on 6 June 2023. Ms Amabili replied on 3 July 2023 and so was aware by then, at least, of the amount of the costs claimed by the respondents. In any event, the totality of the correspondence reveals that the respective solicitors were operating under radically different assumptions.
The costs orders on the appeal
The terms of the oral application for costs on the appeal and the orders made are set out above. The orders are in general terms. Counsel expressed the application in terms of costs ‘of the appeal’ and ‘of the cross appeal’.
The Amended Appeal or Review Grounds: Revision 2 on which the appeal proceeded sought the following orders:
1.That the appeal be allowed.
2.That the claims made by the Respondents remitted for re-hearing to the learned trial judge be dismissed.
3.That the Appellants have their costs of the appeal.
4.That the Appellants have their costs of the rehearing.
5.That the Appellants have their costs of the first trial before Parker J on the remitted issues.
The appellants had therefore sought orders covering all stages of the proceedings now in contest. Importantly for the respondents’ argument, however, under the heading ‘Orders challenged’, the Amended Appeal or Review Grounds: Revision 2 only included the orders set out in FDN 140 in the trial proceedings, which Kourakis CJ had incorporated by the order dated 15 April 2021, including Orders 4 -7 inclusive. They did not include Kourakis CJ’s order of 21 May 2021 that the appellants were to pay the respondents’ costs of the trial before Parker J to be agreed or taxed. That is notwithstanding that the ‘Orders sought’ included an order that would necessarily require setting aside that costs order.
The other aspect to note of the Amended Appeal or Review Grounds: Revision 2 is that they did not allege any independent error in the costs orders. The challenge to the costs orders, whatever its reach, was confined to seeking orders that followed the ‘event’[3] of a successful appeal.
[3] UCR r 194.5(2).
The application
The appellants’ application is premised on the wording of the costs orders of 7 April 2022 possibly having not addressed the costs of the proceedings before Kourakis CJ and Parker J, through a slip or omission. The appellants submitted that whether the application is dealt with as an application for leave to re-open or an application under the ‘slip rule’, the question to be decided is whether the justice of the case favours the exercise of the discretion.
In Raybos Australia Pty Ltd v Tectran Corporation Pty Ltd,[4] Toohey J considered a situation where a successful respondent to an application had failed to apply for costs at all on the delivery of judgment. The affidavit in support of a subsequent summons for the costs of the dismissed action did not explain the failure to ask for costs, but Toohey J inferred that it was caused by an oversight on the part of counsel. His Honour said:[5]
In L Shaddock & Associates Pty Ltd v Paramatta City Council (No 2) (1982) 151 CLR 590; 43 ALR 473 this Court treated O 29, r 11 as a reflection of the inherent jurisdiction of a court to correct an error arising in the circumstances there mentioned and expressly held the rule to extend “to authorise an omission resulting from the inadvertence of a party’s legal representative” (CLR at 594). This view was affirmed in Commonwealth v McCormack (1984) 155 CLR 273; 55 ALR 185.
In many cases the slip rule or its equivalent is invoked when, through error or oversight, a judgment or order fails to express correctly the intention of the court at the time when the judgment or order was announced. But it is clear that this power of correction extends to cases where a matter, through inadvertence, was not dealt with at the hearing. In that case the purpose of correction is not to give expression to the intention of the court at the time the judgment or order was pronounced: Coppins v Helmers & Brambles Constructions Pty Ltd [1969] 2 NSWR 279. That is the situation which has arisen here. None of the cases so far mentioned was concerned with a failure to ask for the costs of a successful proceeding. However Re Inchape (Earl of) [1942] Ch 394 was such a case and Morton J there held that a rule comparable to O 29, r 11 empowered the court to amend an order to include provision for costs which had not been asked for earlier. So to was Rowe v Delfs [1966] WAR 49 where Hale J varied an earlier order by including a certificate for the cost of transcript which counsel had omitted to ask for.
I am satisfied then that the court is empowered to grant the relief which the respondents seek. …
[4] (1988) 77 ALR 190.
[5] (1988) 77 ALR 190 Raybos Australia Pty Ltd v Tectran Corporation Pty Ltd at 191.
In the present case, counsel had only applied, relevantly, for the ‘costs of the appeal, costs of the cross-appeal and costs of the application to amend’. Two possible inferences are available, having regard to the second Amabili affidavit. The first is counsel assumed that the orders he requested encompassed all those sought in the Amended Appeal or Review Grounds: Revision 2. The second is that counsel inadvertently failed to request orders in the terms expressed in that document.
There is a sense in which these two possibilities are not mutually exclusive. It is important, on receiving a successful appeal judgment, to be clear as to the costs orders being sought. While an application ‘for costs’ might be understood in some cases to extend also to the trial proceedings, it is difficult to see that an application for ‘the costs of the appeal’ should necessarily extend to the costs of the trial from which the appeal was brought.
This is illustrated in the present case by the fact that the ‘Orders Sought’ in the Amended Appeal or Review Grounds: Revision 2 distinguished between an order for ‘the costs of the appeal’ and orders for the costs of the trials before Kourakis CJ and Parker J.
The Court’s order was simply expressed in terms that the appellants were ‘to have their costs to be agreed or taxed’. That was the Court’s phrasing in response to the appellants’ application. The respondents did not oppose an order in those terms.
While on one view it might be said that the expression of the application for costs was intended to encompass the costs of both sets of trial proceedings, that was not the expression used. Further, while it might be understandable that such an assumption extended to the costs of the trial of the remitted issues before Kourakis CJ, this case serves as a reminder that assumptions of this nature should not necessarily be drawn.
On any view, an assumption that the application necessarily extended to the costs of the remitted issues as tried before Parker J would not have been sustainable. Such an inference would have required a concluded assumption that it was appropriate for this Court to revisit the 21 May 2021 costs orders by engaging in a proportional assessment of the costs attributable to the trial of the remitted issues before Parker J. It also would have required an assumption that the trial of the remitted issues before Parker J was in the natural contemplation of the Court of Appeal’s costs order, notwithstanding that Parker J had delivered judgment well over four years earlier. Given the time passed and the events of the intervening period, it could not reasonably be assumed that the costs of this discrete set of issues within a broader, previous trial was in the contemplation of an order for ‘the costs of the appeal’.
It follows that even if counsel held such an assumption at the time, the costs application as made was insufficient to extend to the costs of the two sets of trial proceedings. That is having regard, in particular, to the fact that counsel sought a costs order in precisely the terms of paragraph 3 of the Orders Sought (‘costs of the appeal’), but not paragraph 4 or 5.
For the reasons discussed above, this Court has power to amend a costs order in terms that had not been asked for. UCR r 186.1(2) provides that the Court may, if the interests of justice so require, vary a judgment. That power extends to amending a costs order so as to incorporate a further order that was not requested through the inadvertence of counsel.
The appellants suggested that it was not even necessary to engage this rule ‘because the judgment of the Court of Appeal has not been completed by the drawing up and entry of formal orders of the Court’. The authorities they cited in support of this proposition reached into the antiquity of the 1990s.[6] UCR r 182.2(3) now provides:
(3)A judgment by the Court is perfected by being entered into the records of the Court-
(a) when a record of outcome in the prescribed form is signed (physically or electronically) by the presiding judicial officer; or
(b) a formal judgment is entered in the records of the Court under rule 184.1 (whichever occurs first).
[6] McAdam v Robertson [1999] SASC 169.
UCR r 184.1 preserves the process of drawing up and entry of formal orders. However, that process is not required to perfect a judgment. In the present case, the judgment was perfected when the presiding judicial officer, Lovell JA, signed the Record of Outcome electronically on 8 April 2022.
UCR r 186.1(2) then provides a power to vary a judgment so perfected. The scope of the Rule is yet to be explored fully.[7] It is important to emphasise that the Court is only concerned in this case with the prospect of correcting an omission by inadvertence.
[7] See Poniatowska v Channel Seven Sydney Pty Ltd (No 4) [2021] SASCFC 32 at [16]. Compare Clone Pty Ltd v Players Pty Ltd (in Liq) (2018) 264 CLR 165.
The perfecting of judgments by the electronic signing of a record of outcome is now a routine practice, necessary for the orderly management of an electronic court file system. It has been necessary for the Rules to evolve to continue to allow for corrections for inadvertence, given that judgments are now perfected electronically expeditiously and as a matter of course.
Even in the present narrow class of case, the ‘interests of justice’ require consideration of various factors relevant to the discretion, including any delay by the applicant.
The costs of the trial of the remitted issues before Kourakis CJ
At the oral hearing of the application, the respondents opposed an order expressing (or clarifying) that the appellants were to have the costs of the remitted proceedings before Kourakis CJ. Senior counsel expressed the basis of this opposition as follows:
We would say that the reasoning of the Chief Justice is sound. Even if we’ve been unsuccessful in relation to those two issues, we overall had success in relation to the matter…
At the conclusion of the oral hearing, the parties were given leave to file written submissions. The respondents did not develop this argument in their written submissions. It is difficult to understand. The respondents’ success in the Full Court was one aspect of the proceedings. The subsequent fate of the matters remitted to Kourakis CJ attracted their own costs consideration by reference to their fate at that trial and then on appeal. Indeed, that is how his Honour dealt with the costs of the hearing of the remitted issues.
Following the appeal to this Court, the respondents were not ultimately successful on those issues. Notwithstanding the delay in bringing this matter to the attention of the Court, the interests of justice favour varying the order of the Court of Appeal to express that the appellants are to have their costs of the trial of the remitted issues that was heard by Kourakis CJ. That is an obvious consequence of the outcome of the appeal, the intent of which is reflected in the breadth of the order that was actually made by the Court.
The costs of the trial of before Parker J
The respondents’ resistance to an order for the costs of the trial before Parker J had a different character. The respondents observed, as noted above, that the Amended Appeal or Review Grounds: Revision 2 did not identify the costs order of 21 May 2021 as being under appeal. They also observed that none of the grounds of appeal challenged the 21 May 2021 costs order. They went so far as to submit that there was an ‘absence of any reference to an appeal against the [21 May 2021 order] in the entire appeal record’.
For the reasons explained above, this last submission is not entirely correct. Paragraph 5 in the ‘Orders sought’ section of the Amended Appeal or Review Grounds: Revision 2 sought an order:
5.That the Appellants have their costs of the first trial before Parker J on the remitted issues.
The Amended Appeal or Review Grounds: Revision 2 did not express any challenge to the costs order of 21 May 2021. It should have. However, the presence of the above paragraph notified the respondents, after a fashion, that the appellants were seeking costs orders in respect of the trial before Parker J, consequent on their anticipated success on the substantive grounds of appeal.
The respondents’ position in respect of this part of the application is that the appellants were required to seek leave to appeal against the 21 May 2021 costs order. In this regard, they referred to UCR 213.1(1)(c), which requires leave to appeal ‘against an order or judgment that relates to costs’. In this regard, they referred to the statement of this Court in Varnhagen v State of South Australia (No 3):[8]
The appellants require leave to appeal against the costs order pursuant to r 213.1(1)(c) of the Uniform Civil Rules 2020 (SA). Whether leave to appeal should be granted turns on well-established criteria.[9] There is a particular hesitation in granting leave to appeal on a matter of practice and procedure, especially on a question of costs.[10]
(Footnotes in original)
[8] [2022] SASCA 134 at [21].
[9] McDonald v Attorney‑General for the State of South Australia [2022] SASCA 43, [21] (Livesey P and Bleby JA).
[10] Flowers v Finlayson [2021] SASCA 75, [27] (Lovell, Doyle and Livesey JJA).
That case relevantly concerned a question of whether a judge had made a material error in the exercise of the costs discretion. Similarly, in Bramwell v Bramwell,[11] on which the respondents also relied in asserting that leave was required, the appeal relevantly concerned an error in the exercise of the costs discretion.[12]
[11] [2023] SASCA 94.
[12] Bramwell v Bramwell [2023] SASCA 94 at [136].
In this case, by contrast, the appellants have not purported to appeal separately against the 21 May 2021 costs order or alleged any error in Kourakis CJ’s exercise of his discretion in making that order.
As noted above, Kourakis CJ made the 21 May 2021 costs order on the basis that the issues on which the respondents did not succeed were issues of construction that were inextricably connected to the matters on which they did succeed. He held that it was not appropriate to differentiate between issues in the award of costs. The issues on which the respondents did not succeed (at that stage) were whether the arrangement between the parties was a partnership and whether the joint venture was terminable on notice.
The consequence of the appellants’ successful appeal before this Court is that the respondents have now not succeeded on two further issues that were before Parker J, being whether Semweb should be removed as trustee and the claim under s 233 of the Corporations Act. It could not now be said that the issues on which the respondents did not succeed were largely matters of construction bound up with the substantive issues. The premise of the 21 May 2021 costs order has changed with the reversal of the ‘event’ of the determination of the remitted issues.
We are not persuaded that it was necessary for the appellants to seek leave to appeal against the costs order of 21 May 2021 insofar as that order incorporated the costs of the remitted issues as originally before Parker J. It was open to the appellants to seek to have that order set aside as part of the event of a successful appeal on the remitted issues.
It follows that that there is a path of strict logic by which this Court could further amend the costs order of 7 April 2022 to set aside the order of 21 May 2022 and fashion a costs order reflecting the eventual, relative successes following the appeal. That strict logic would not be inconsistent with the exercise of the discretion to vary the order to allow the costs of the remitted proceedings before Kourakis CJ.
However, other considerations assume greater significance here. First, the Amended Appeal or Review Grounds: Revision 2 did not expressly challenge the 21 May 2021 order. While the ‘Orders sought’ did reference the costs of the remitted issues before Parker J, the document was not clear as to the basis on which that order was sought. It has been necessary to construe that. The amenability of those costs to being revisited as part of ‘the event’ was not as clear on the Amended Appeal or Review Grounds: Revision 2 as it was for the costs of the remitted hearing before Kourakis CJ.
Moreover, it is only now that the appellants are asking that the costs of the trial before Parker J be referred for determination to a single justice of this Court. That is to say, the nature of the order sought has changed from, or at least expanded upon, that sought in the ‘Orders sought’ in the Amended Appeal or Review Grounds: Revision 2.
This leads to the issue of delay. This Court delivered judgment in April 2022. The appellants only agitated this issue when the respondents’ attitude became apparent to them in August 2023. They filed the interlocutory application in November 2023.
The delay assumes a greater significance in respect of this costs issue than it does with respect to the costs of the remitted proceedings before Kourakis CJ. It has occurred in circumstances where the Amended Appeal or Review Grounds: Revision 2 was unclear on this issue, albeit that it can technically be said to have raised the issue at some level. Now, however, after almost two years, what is sought is a further round of apportionment of costs by reference to the issues that occupied a trial that concluded in 2017. The delay to 2022 cannot be helped, but the delay since then could have been.
The matter is finely balanced. The appellants did not articulate properly the challenge to the costs order now made or the orders sought on appeal. They did not seek an order for referral to a single justice for an apportionment of costs based on the issues before Parker J. They did not apply expeditiously for the orders now sought.
Had they done these things, logic might have favoured the order for costs of the remitted proceedings being extended to some proportion of the costs of the trial before Parker J and the necessary enabling orders being made. As it is, however, the delay is not well explained. The appellants’ primary position is that the orders made on 7 April 2022 had the necessary reach and that the present application is unnecessary. With respect, it is difficult to see how that position can be sustained in circumstances where the appellants now seek to have the question of apportionment of costs by reference to issues referred to a single justice. That has not previously been sought orally or in writing. On no view could it be inferred to be a part of this Court’s costs orders of 7 April 2022.
The High Court has emphasised the importance of taking a strict approach to finality.[13] The orders the appellants now seek would have the effect of extending still further the time taken to finalise this matter. That would involve the incurring of yet further costs. Those costs are likely to be greater on account of the delay than had the issue been agitated properly from the outset. Further, while the apportionment of costs according to the significance of the issues litigated has become a more common practice, it cannot be assumed that some apportionment of the costs of the trial before Parker J would be an inevitable outcome of any further hearing.[14]
[13] Clone Pty Ltd v Players Pty Ltd (in Liq) (2018) 264 CLR 165 at [70].
[14] SkyCity Adelaide Pty Ltd v Treasurer of South Australia (No 2) [2024] SASCA 18 at [16].
In all the circumstances and having particular regard to the delay and the imperative of finality, the interests of justice do not favour varying the judgment so as to interfere with the costs order of 21 May 2021.
Conclusion
We grant the appellants leave to apply to vary the orders of this Court entered on 8 April 2022. We vary those orders by making the following order:
7.The respondents are to pay the appellants’ costs of the trial on the remitted issues heard by Kourakis CJ.
We decline to vary the orders further. The appellants are to pay the respondents’ costs of this interlocutory application. The interlocutory application should not have been necessary. The appellants have been partially successful, but only on the issue that met the least resistance. This interlocutory application is not an appropriate matter for an apportionment of costs by issue.
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