Michael Wilson & Partners Ltd v Nicholls (No 13)
[2024] ACTCA 15
•17 April 2024
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
COURT OF APPEAL
Case Title: | Michael Wilson & Partners Ltd v Nicholls (No 13) |
Citation: | [2024] ACTCA 15 |
Hearing Date: | On the papers |
Decision Date: | 17 April 2024 |
Before: | Curtin AJ |
Decision: | (1) The applicant is to pay the sixth respondent’s costs of the application for leave to appeal. |
Catchwords: | PRACTICE AND PROCEDURE – COSTS – Application for costs order by sixth respondent – consideration of usual rule that costs follow the event – whether conditional appearance displaces the usual rule – costs awarded in favour of sixth respondent |
Legislation Cited: | Court Procedures Rules 2006 (ACT) rr 40, 111 |
Cases Cited: | Armacel Pty Ltd v Smurfit Stone Container Corporation [2007] FCA 1928; 164 FCR 123 |
Parties: | Michael Wilson & Partners ( Applicant) Robert Colin Nicholls ( First Respondent) David Ross Slater (Second Respondent) Temujin Services Ltd (Third Respondent) Temujin International Ltd (Fourth Respondent) Temujin International FZE (Fifth Respondent) John Forster Emmott (Sixth Respondent) Effective Funds Management Pty Ltd (Seventh Respondent) |
Representation: | Counsel M Wilson ( Applicant) J Baird ( Sixth Respondent) |
| Solicitors Michael Wilson & Partners ( Applicant) Duggan Legal ( Sixth Respondent) | |
File Number: | SCA 26 of 2021 |
Decision Under Appeal: | Court/Tribunal: Supreme Court of the ACT Before: McWilliam AsJ Date of Decision: 30 June 2021 Case Title: Michael Wilson & Partners Ltd v Nicholls Citation: [2021] ACTSC 128 |
CURTIN AJ:
Introduction
1․In Michael Wilson & Partners Ltd v Nicholls (No 12) [2024] ACTCA 1, I dismissed the applicant’s application for leave to appeal from the decision of McWilliam AsJ (as her Honour then was) in Michael Wilson & Partners Ltd v Nicholls & Ors [2021] ACTSC 128.
2․The sixth respondent seeks his costs of the application for leave to appeal on the basis that costs ordinarily follow the event and there is no discretionary reason to depart from that usual outcome.
3․The seventh respondent has not sought its costs of appearing in the application for leave to appeal.
Submissions
The sixth respondent’s submissions
4․The sixth respondent submitted that costs ought follow the event. He was successful, the applicant was unsuccessful, and therefore the applicant should pay the sixth respondent’s costs.
5․The sixth respondent does not reside in Australia and, on the application for leave to appeal, said he had not submitted to the jurisdiction of this Court on this application nor in the Court below. No issue was taken with that statement by the applicant.
6․The sixth respondent submitted that although he had only appeared conditionally, that fact should not disentitle him to his costs.
7․The sixth respondent brought to my attention the fact that McWilliam AsJ dismissed Michael Wilson & Partners’ (MWP) application with costs and no issue was raised at that time, or subsequently, or on appeal as to MWP’s liability to the sixth respondent for his costs pursuant to that order by reason of the latter’s conditional appearance.
8․The sixth respondent also brought to my attention the fact that before I heard the application for leave to appeal there was an interlocutory application (in the leave to appeal proceedings) determined by Loukas-Karlsson J in which her Honour ordered MWP to pay the sixth respondent’s costs of that application on an indemnity basis: see Michael Wilson & Partners Ltd v Nicholls (No 10) [2023] ACTCA 13 (MWP (No 10)). It was submitted that no issue was raised as to MWP’s liability to the sixth respondent for his costs under that order by reason of the latter’s conditional appearance.
9․The sixth respondent cited News Corporation Ltd v Lenfest Communications Inc (1996) 40 NSWLR 250 at 260-261 (Lenfest), Armacel Pty Ltd v Smurfit Stone Container Corporation [2007] FCA 1928; 164 FCR 123 at 124-125 [7]-[10] (Armacel), and Suzlon Energy v Bangad [2011] FCA 1152; 198 FCR 1 (Suzlon).
The applicant’s submissions
10․MWP made many irrelevant submissions to the issue I need to determine.
11․The only relevant submission on costs was a submission in response to the sixth respondent’s reliance on Lenfest, Armacel and Suzlon. The applicant submitted:
The cases [cited by the sixth respondent and mentioned above] do not assist the Sixth Respondent. Those cases relate to circumstances where the party who did not submit to the Court’s jurisdiction obtained costs strictly in relation to the costs of objecting to the Court’s jurisdiction over them.
12․The second sentence of that submission is wrong. The costs related to applications to set aside notices to produce, not the costs of objecting to the Courts’ jurisdiction.
13․On 27 March 2024, the applicant also filed, without leave, further written submissions on costs. As no leave was sought or granted in relation to those submissions, they have not been considered.
Decision
14․Although the sixth respondent said he only appeared conditionally (because he had filed a Conditional Notice of Intention to Respond on 16 July 2021), he had, as far as the Court’s records disclosed, never filed an application under r 40 of the Court Procedures Rules 2006 (ACT) (Rules) to set aside the originating process.
15․Rule 111 of the Rules allows for the filing of a conditional notice of intention to respond but says that if no application is made within 28 days after that notice is filed, the conditional notice of intention to respond becomes an unconditional notice of intention to respond. Rule 111 says:
111 Conditional notice of intention to respond
(1)If a defendant proposes to challenge the court’s jurisdiction or to assert an irregularity, the defendant must file a conditional notice of intention to respond.
Note See also r 109 (Notice of intention to respond or defence—person incorrectly served as partner).
(2)If a defendant files an unconditional notice of intention to respond or defence, the defendant is taken to have submitted to the court’s jurisdiction, and waived any irregularity in the proceeding or defect in service of the originating process.
(3)If a defendant files a conditional notice of intention to respond, the defendant must apply for an order under rule 40 (Setting aside originating process etc) not later than 28 days after the day the notice is filed.
(4)If the defendant does not apply for an order under rule 40 before the end of the 28-day period, or the defendant applies but the application is refused, the conditional notice of intention to respond becomes an unconditional notice of intention to respond.
(5)If the conditional notice of intention to respond becomes an unconditional notice of intention to respond and the proceeding was started by originating claim, the defendant must file a defence not later than 14 days after the day the conditional notice becomes an unconditional notice.
16․Accordingly, the sixth respondent had submitted to the jurisdiction of the Court and did not appear before me conditionally.
17․Even if that were incorrect, and the sixth respondent did only appear conditionally, I would not have exercised my costs discretion adversely to him. That is because the applicant made the application for leave to appeal and thus caused the sixth respondent to incur legal expenses in opposing that application, and I cannot see any reason why a conditional appearance on this application should displace the usual rule that costs follow the event.
18․The cases cited by the sixth respondent were of little assistance.
19․Lenfest dealt with the power of the Supreme Court of New South Wales to serve a notice to produce where one of the parties was a foreigner who had not submitted to the jurisdiction of the Court and had on foot an unresolved contest over that jurisdiction. The Court had before it an application seeking orders that a notice to produce be set aside or alternatively that the documents sought not be required to be produced. Giles CJ Comm D referred to the principle that a respondent seeking to challenge the jurisdiction of the Court should not have imposed upon it one of the Court’s compulsory processes in aid of establishing that jurisdiction and made an order that the respondent was not obliged to produce the documents sought. The issue of costs of that application did not arise.
20․In Armacel, the applicant had been granted leave to serve an originating process on the respondent in the United States of America. The respondent brought an application to set aside that order and that application was given a hearing date. Before that hearing date, the applicant served two notices to produce, and the respondent brought an application seeking to set those notices to produce aside or, alternatively, seeking an order that the respondent was not obliged to respond to those notices to produce.
21․Justice Jacobsen referred to Lenfest and said that, at that stage of the proceedings in which jurisdiction was under challenge, the applicant could not invoke the compulsory processes of the Court: see Armacel at 124-125 [10]. His Honour made an order that the respondent was not obliged to produce the documents until further order of the Court and ordered the applicant in the proceedings to pay the respondent’s costs of the application made in relation to the notices to produce: see Armacel at 125 [17]-[18].
22․A similar application in similar circumstances was made in Suzlon, with a similar result.
23․In each of those cases, the application was a collateral application to an application challenging jurisdiction, whereas before me was an application divorced from any challenge to jurisdiction.
24․Of perhaps greater relevance are Michael Wilson & Partners Ltd v Nicholls (No 9) [2022] ACTCA 70 (MWP (No 9)) and MWP (No 10).
25․In MWP (No 9), Loukas-Karlsson J said at [93]:
Nevertheless, the applicant persisted in advancing similar arguments at the hearing on costs, indeed arguing that the conditional appearance was improper and disentitled the sixth respondent to an order for costs. Such an argument was wholly without merit and ignored my earlier findings. …
26․The significance of MWP (No 9) is that the Court determined that the sixth respondent’s conditional appearance did not disentitle him to costs.
27․The significance of MWP (No 10) is that the sixth respondent was awarded costs in an application not involving a determination of the Court’s jurisdiction nor a collateral application (such as in Lenfest, Armacel and Suzlon).
Orders
28․I make the following order:
(1)The applicant is to pay the sixth respondent’s costs of the application for leave to appeal.
| I certify that the preceding twenty-eight [28] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Justice Curtin Associate: Date: |
6
1