Mitrov Homes Pty Ltd v Mustafa (No 3)
[2023] VSC 402
•7 July 2023 Ex tempore; revised 10 July 2023
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL COURT
COMMERCIAL LIST
S ECI 2019 05718
| MITROV HOMES PTY LTD (ACN 618 226 247) | Plaintiff |
| v | |
| BUJAR MUSTAFA | First Defendant |
| NEZ LOCI | Second Defendant |
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JUDGE: | Connock J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 7 July 2023 |
DATE OF RULING : | 7 July 2023 Ex tempore; revised 10 July 2023 |
CASE MAY BE CITED AS: | Mitrov Homes Pty Ltd v Mustafa (No 3) |
MEDIUM NEUTRAL CITATION: | [2023] VSC 402 |
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COSTS — Interlocutory application to set aside dismissal of claim against first defendant as a result of failure to comply with a self-executing order — Application for extension of time to comply with self-executing order — Application opposed — Application successful — Orders made setting aside the dismissal judgment resulting from the triggering of a self-executing order — Orders made extending the time, nunc pro tunc, to comply with self-executing order — Costs not to follow the event — Luxmore Pty Ltd v Hydedale Pty Ltd (2008) 20 VR 481 referred to — Plaintiff to bear its own costs of the application — First defendant’s costs of the application to be his costs in the proceeding.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | J Levine | Maciel Pizzorno & Co Lawyers & Consultants |
| For the First Defendant | C Venegas (Solicitor) | CAV Law Pty Ltd |
| For the Second Defendant | No Appearance | Self-represented |
HIS HONOUR:
Introduction
On 7 July 2023 I delivered my reasons for decision[1] in this proceeding (Reasons) determining the plaintiff’s application (Application) to:
[1]Mitrov Homes Pty Ltd v Mustafa (No 2) [2023] VSC 386.
(a) extend the time (now for then) by which the plaintiff was required to provide security for the first defendant’s (Mr Mustafa) costs pursuant to orders made on 21 February 2023:
(i) extending the time by which the plaintiff was to provide $62,000 security for Mr Mustafa’s costs (Security) to 4:00pm on 17 March 2023 (Security Extension Order); and
(ii) ordering that if the Security was not provided by 4:00pm on 17 March 2023 (Security End Date), the plaintiff’s claim against Mr Mustafa is dismissed (SE Order); and
(b) set aside the dismissal of the plaintiff’s claim against Mr Mustafa that resulted from the triggering of the SE Order by reason of the plaintiff’s failure to provide the Security by the Security End Date.
The Application was opposed by Mr Mustafa. The second defendant, Ms Loci, is self‑represented and took no position on the Application. Ms Loci did not appear at the hearing or at the directions hearing on 7 July 2023 when the Reasons were delivered, argument was heard in relation to costs, and directions were made regarding the future conduct of the proceeding.
The Application was successful and, subject to the plaintiff paying the Security into court by 4:00pm on 10 July 2023, orders were made extending the time by which the plaintiff is to provide the Security until 4:00pm on 10 July 2023 and setting aside the dismissal of the plaintiff’s claim against Mr Mustafa.
This ruling deals with the costs of the Application.
Discretionary Power
The power of the court to award costs is a discretionary power. That power is to be exercised judicially having regard to the relevant circumstances,[2] which are invariably circumstances connected with the litigation. Like all discretionary powers of the court, the power to award costs is not to be exercised arbitrarily or capriciously.
[2]Noting also the obligations imposed on the court by ss 8 and 9 of the Civil Procedure Act 2010 (Vic) when exercising its powers (s 8) or making an order or giving a direction (s 9) — and to which I have had regard and taken into account in reaching the conclusions referred to in these costs reasons.
In Luxmore Pty Ltd v Hydedale Pty Ltd (Luxmore),[3] it was observed that in the ordinary case it is appropriate and desirable that a costs question be decided at the conclusion of argument, and rarely will it be necessary for a judge to give detailed reasons for decision adverting to every matter debated in argument. It was said in that case that the Court of Appeal will assume — as should the parties to a proceeding — that every matter addressed in argument on costs has been considered and the Court of Appeal will ‘set its face against’ any proposition which would require judges disposing of questions of costs to give elaborate reasons.[4]
[3](2008) 20 VR 481, [12] (Maxwell P and Kellam JA).
[4]Ibid.
Plaintiff’s Costs
The only reason that the Application needed to be made, heard and determined was because of the plaintiff’s non-compliance with the Security Extension Order that resulted in the triggering of the SE Order dismissing the plaintiff’s claim against Mr Mustafa.
So much was properly recognised by counsel for the plaintiff, who submitted that, although the plaintiff had been successful in its application, the plaintiff was, in effect, seeking an indulgence consequent upon its failure to comply with court orders. It was submitted by the plaintiff that, given the circumstances, it was appropriate that the court require the plaintiff to bear its own costs of the Application.
I accept this submission and agree that, having regard to the circumstances,[5] the plaintiff should be required to bear its own costs of and incidental to the Application.
[5]As to which see Reasons, [1]–[44] and [96]–[164], and also taking into account the outcome of the Application.
The Application was made by the plaintiff in the circumstances addressed in the Reasons, to which I refer but will not repeat. These costs reasons assume a knowledge of the Reasons and should be read together with them.
If the Application had not been made, the plaintiff’s claim against Mr Mustafa would remain dismissed. This is because the plaintiff triggered the SE Order by its failure to provide the Security by the Security End Date as required by the Security Extension Order.
In order to set aside the dismissal of the plaintiff’s claim against Mr Mustafa it was necessary for the plaintiff to apply to the court and establish that justice required that the dismissal be set aside and that justice required a short extension of time to be given to the plaintiff to provide the Security, notwithstanding that the plaintiff had failed to comply with the Security Extension Order and had triggered the operation of the SE Order. Put another way, it was necessary for the plaintiff to positively satisfy the court that justice required such relief to be granted. I refer in this regard to the rules, principles and observations addressed in paragraphs 81 to 95 of the Reasons, and their consideration and application to the circumstances in question in paragraphs 103 to 164 of the Reasons.
It will be apparent from the paragraphs of the Reasons referred to above that, even if Mr Mustafa had consented to or not opposed the granting of relief, it would have been necessary for the court to be positively satisfied that the relief sought by the plaintiff should be granted in the circumstances. Any such non-opposition or consent to the grant of relief by Mr Mustafa would simply have been an additional matter to be taken into account by the court when analysing and determining what justice required in the circumstances.
That being so, if the plaintiff desired to have the dismissal of its claim against Mr Mustafa set aside, it was always going to be necessary for the plaintiff to make the application that it did, supported by appropriate evidence and submissions. Keeping in mind that it was necessary for the plaintiff to address, and for the court to consider, all of the relevant circumstances, the plaintiff would have incurred all or nearly all of the costs that it has incurred in connection with the Application even if the Application had not been opposed by Mr Mustafa.
In these circumstances, and noting also that there was no evidence to suggest nor submissions made that Mr Mustafa was in some way responsible for, or contributed to, the plaintiff’s failure to comply with the Security Extension Order, it is appropriate that the plaintiff bear its own costs of and incidental to the Application.
Mr Mustafa’s Costs
With respect to Mr Mustafa’s costs of and incidental to the Application, Mr Venegas submitted that these costs should be Mr Mustafa’s costs in the proceeding. I accept that submission, noting also that it was not ultimately resisted by counsel for the plaintiff, which in my view was a proper position for counsel to take.
Given the circumstances leading up to the plaintiff’s failure to comply with the Security Extension Order[6] and the triggering of the SE Order, including the absence of any communication with Mr Mustafa’s solicitors prior to the dismissal of the plaintiff’s claim against Mr Mustafa consequent upon the triggering of the SE Order, it was in my view reasonable for Mr Mustafa to take the position that he did in opposing the Application. The taking of this position by Mr Mustafa also ensured that all of the relevant circumstances were exposed to the court, thereby facilitating the court’s consideration of the primary issue, which was whether justice required the grant of the relief sought by the plaintiff.[7]
[6]As referred to and addressed in detail in the Reasons.
[7]See Reasons [96].
The matters raised by Mr Mustafa also assisted the court in complying with its obligation under s 8 of the Civil Procedure Act 2010 (Vic) to seek to further the overarching purpose of facilitating the just, efficient, timely and cost-effective resolution of the real issues in dispute.[8]
[8]And the court’s obligation under s 9 of the Civil Procedure Act 2010 (Vic).
Even if Mr Mustafa had consented to or not opposed the grant of relief to the plaintiff on the Application, it would have been necessary and appropriate for Mr Mustafa and those advising him to have given considered attention to the matters raised by the plaintiff in support of the Application, and to draw relevant circumstances to the court’s attention so as to ensure that all relevant circumstances were taken into account by the court when determining what justice required.
The matters referred to above in connection with the plaintiff’s costs are also relevant to Mr Mustafa’s costs position, and they further support the conclusion that Mr Mustafa’s costs on the Application should be part of his costs in the proceeding — as does the absence of any evidence or suggestion that Mr Mustafa or his advisers in some way caused or contributed to the plaintiff’s breach of the Security Extension Order or the triggering of the SE Order.
In the circumstances, it is appropriate that Mr Mustafa’s costs of and incidental to the Application be his costs in the proceeding.
Ms Loci’s Costs
As mentioned, Ms Loci is self-represented, was not a party to the application, did not take any step in relation to it, and did not appear at the hearing of the Application or at the directions hearing on 7 July 2023 when the Reasons were delivered. Consequently, I do not propose to make any order with respect to Ms Loci’s costs (if any) of and incidental to the Application.
Proposed Orders
I propose to make the following orders regarding the costs of the Application:
1.The plaintiff shall bear its own costs of and incidental to its application by summons filed 21 April 2023.
2.The first defendant’s costs of and incidental to the plaintiff’s application by summons filed 21 April 2023 shall be the first defendant’s costs in the proceeding.
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