MIM Holdings Ltd (ACN 009 814 019) v the Commissioner of Stamp Duties
[1999] QSC 327
•28 October 1999
SUPREME COURT OF QUEENSLAND
CITATION:MIM Holdings Ltd (ACN 009 814 019) -v- The Commissioner of Stamp Duties
PARTIES: MIM HOLDINGS LTD (ACN 009 814 019)
(Applicant)
THE COMMISSIONER OF STAMP DUTIES
(Respondent)
FILE NO/S: APN810 of 1994
DIVISION: TRIAL DIVISION
PROCEEDING: Application pursuant to s49 of Judicial Review Act 1991
DELIVERED ON: 28 October 1999
DELIVERED AT: Brisbane
HEARING DATE/S: Written submissions
JUDGE: White J
ORDER:1. The respondent to pay the applicant’s costs of and incidental to the application with the costs of the hearing to be limited to one day and excluding any costs of the issue whether Ernest Henry Mining Pty Ltd was a “land rich” corporation within the meaning of s 56FL of the Stamp Act to be taxed.
2.The applicant pay the respondent’s costs of and incidental to that issue, namely whether Ernest Henry Mining Pty Ltd was a “land rich” corporation within the meaning of s 56FL of the Stamp Act such costs to include the costs of one day of the hearing to be taxed.
CATCHWORDS: COSTS - COSTS OF ISSUES - applicant successful on some issues only.
Fexuto Pty Ltd v Bosnjak Holdings Pty Ltd (No. 3) (1998) 30 ASCR 20
Reid Hewitt & Co v Joseph [1918] AC 717
Thiess v TCN Channel Nine Pty Ltd (No 5) [1994] 1 Qd R 156
Judicial Review Act 1991, s49
Stamp Act 1894, ss 56FL, 56FN
COUNSEL: Mr L Harrison QC for applicant
Mr R Hanson QC for the respondent
SOLICITORS: Blake Dawson Waldron for applicant
Crown Solicitor for the respondent
The Applicant for a statutory order of review has sought its costs of the application pursuant to s 49 of the Judicial Review Act 1991. The parties accept that s 49(4) applies, that is, that the rules of court as to costs apply to this application.
The application involved two principal and discrete issues:
(1)Did MIM (the applicant) acquire a majority interest in Ernest Henry Mining Pty Ltd pursuant to s 56FN of the Stamp Act 1894; and
(2)Was Ernest Henry Mining Pty Ltd a “land rich” corporation within the meaning of s 56FL of the Stamp Act.
There were two lesser issues:
(3) The amount of duty payable; and
(4) If no duty was payable whether interest was recoverable and if so, at what rate?
The applicant was successful in respect of issue (1) and therefore successful on the application and on the question of interest. It was unsuccessful on issue (2). It was also successful on the issue of the amount of duty if duty was payable.
The appropriate starting point is O 91 of the previous rules of court. The Uniform Civil Procedure Rules which came into force on 1 July 1999 do not apply. O 91 r 1 provides that subject to the rules the costs of all proceedings are in the discretion of the judge. This general rule is qualified by O 91 r 3(1) which provides:
“When several issues, whether of fact or law, are raised upon a claim or counter-claim, the costs of the several issues respectively, both in law and fact, shall, unless otherwise ordered, follow the event”.
The applicant contends that it is appropriate that the costs ought to follow the outcome overall and not be fragmented into separate issues while the respondent submits that the proper approach is to allow costs in respect of the issues upon which each party was successful.
The Court of Appeal in Thiess v TCN Channel Nine Pty Limited (No 5) [1994] 1Qd
R 156 supported a distributive approach to costs where there are separate outcomes in respect of separate issues. Commenting on Lord Finlay’s examination of the history of the practice governing awards of
costs in common law actions before and after the Judicature Act in Reid Hewitt & Co-v- Joseph [1918] AC 717 the Court said at p207-8:“After an extensive review of the many decisions on the point, his Lordship concluded ([1918] AC 717, 733)] that ‘they all decide that the words ‘the costs shall follow the event’ mean that the costs are to be distributed according to the results of the several issues, while the party who is successful on the whole gets the general costs’. By the latter he meant the general costs of the action ...
The provisions of O 91 r 13 [sic] appear not to have had any direct English analogue but to have their origin in Queensland. They appear to be an attempt to express in statutory form the principal laid down by the authorities in England after the Judicature Act 1873. The word “event” in that context is, as the speech of Lord Finlay shows, to be approached “distributively”, with the consequence that it refers to the event of an issue or of each separate issue, if there is more than one, in the action. One can be reasonably confident that the draftsman (who is generally acknowledged to be Sir Samuel Griffith) of O 91 r 3 knew of and was intending to preserve that line of authority. The word “event” in O 91 r 3 is therefore to be read as meaning the event of each of the “several issues” to which the rule refers. Even so, the rule is expressly qualified by the words “unless otherwise ordered” so that a discretion is given to adopt a different course than that generally dictated by the rule. The result is that, whether one looks separately at the proviso to O 91 r 1 [relating only to jury verdicts], or at O 91 r 3, or at both together, there is evident in the rules a predilection in favour of distributing costs according to the outcome or “event” of particular issues in the action.
The application of these rules as to costs where different issues are determined in different directions as between the parties to a single action was considered in this Court in Colburt -v- Beard [1992] 2Qd R 67. There is a discernable preference in the judgments of both of the learned Judges (Thomas and Ryan J J) who delivered reasons in that case for avoiding the complicated forms of taxation that would follow if costs were to be awarded in respect of issues in the technical sense. Thomas J inclined to the course favoured by Bowen L J in Forster -v- Farquhar [1893] 1Q B 564-570 of exercising a discretion by which the court may identify heads of controversy or “units of litigation” as the criteria for awarding costs. There is much to commend this course, which we suspect is what is often done in practice.”
In allowing the cross-appeal as to costs the Court of Appeal in Thiess concluded that the assessment of the relative victories of each party on the separate issues was:
“that the plaintiff succeeded as to one-third of this claims for defamation whereas the defendant was successful in establishing a defence to the remaining two-thirds,” p.210.
Accordingly the court held that the:
“net result of such an approach would be to oblige the plaintiff to pay one-third of the costs of the defendant TCN9. Approximate though this may be, it seems to us to be preferable to the alternative of apportioning costs according to the success of either party in relation to particular issues, which would produce a process of taxation that seems to be almost universally deplored”, ibid.
The respondent submits that the appropriate order is that it pay the applicant’s costs of and incidental to the application and limited to one hearing day excluding any costs relating to the issue whether Ernest Henry Mining Pty Ltd was a “land rich” corporation within the meaning of s 56FL of the Stamp Act and that the applicant pay the respondent’s costs of that issue to include the costs of one hearing day.
The applicant submits that it is appropriate to look at the matter globally and give it the whole of its costs. It refers to Fexuto Pty Ltd -v- Bosnjak Holdings Pty Ltd (No. 3) (1998) 30 ACSR 20, but that was not a case where there were several distinct issues and Young J. distinguished such cases at 24. The applicant contended that if the costs of the application were to be approached on an issues basis then the issue on which it was unsuccessful should itself be divided into “sub-issues” and on some of these it was successful. However, it was not successful on what I regarded as the two major aspects of this question - the status of the contractual rights and the uncalled premiums. Both of these topics occupied a considerable amount of the hearing time particularly the oral evidence and it is reasonable to conclude that the hearing would without them have been confined to one day. I do not therefore accept the approach of the applicant to the costs of the issue whether Ernest Henry Mining Pty Ltd was a “land rich” corporation in respect of which it was unsuccessful.
Neither party favours such a broad approach as was taken in Thiess so as to award a fraction or percentage of the costs to the applicant. The cost of preparation for each issue is unlikely to be comparable. Accordingly the orders which I make with respect to the costs of the application are:
1.The respondent to pay the applicant’s costs of and incidental to the application with the costs of the hearing to be limited to one day and excluding any costs of the issue whether Ernest Henry Mining Pty Ltd was a “land rich” corporation within the meaning of s 56FL of the Stamp Act to be taxed.
2.The applicant pay the respondent’s costs of and incidental to that issue, namely whether Ernest Henry Mining Pty Ltd was a “land rich” corporation within the meaning of s 56FL of the Stamp Act such costs to include the costs of one day of the hearing to be taxed.
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