Mole v Mole (No 2)

[2021] VSC 802

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

TRUSTS, EQUITY AND PROBATE LIST

S ECI 2021 04141

IN THE MATTER of the Will and Estate of COLIN GRAEME MOLE, deceased

COLIN CHARLES MOLE ANDREW JAMES MOLE NATHAN CHARLES MOLE	Plaintiffs
v
STEVEN JAMES MOLE (in his capacity as Executor and Trustee of the Estate of COLIN GRAEME MOLE, deceased)	Defendant

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JUDGE:	MOORE J
WHERE HELD:	Melbourne
DATE OF HEARING:	11 November 2021
DATE OF JUDGMENT:	6 December 2021
CASE MAY BE CITED AS:	Mole v Mole (No 2)
MEDIUM NEUTRAL CITATION:	[2021] VSC 802

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COSTS – Interlocutory injunction – Application for judicial advice – Whether costs should follow the event – Plaintiffs failed to establish prima facie case – Defendant awarded costs on standard basis – Supreme Court Act 1986 s 24(1).

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Davies Watson Pty Ltd
For the Defendant	Mr J Smith	Earl & Associates

HIS HONOUR:

1. On 11 November 2021 I dismissed an application by the plaintiffs for an interlocutory injunction restraining the defendant from treating as being terminated or rescinded certain contracts of sale of land.  I published my reasons for judgment on 16 November 2021.[1]

   [1]Mole v Mole [2021] VSC 752.

1. The remaining controversy between the parties is in relation to costs.  The defendant seeks an order that the plaintiffs pay his costs of the unsuccessful application for interlocutory injunctive relief on an indemnity basis.  The plaintiffs’ solicitor informed my chambers that he has been unable to obtain adequate instructions to make submissions on costs, but directed my attention to the decision of the Court in Tower Australia Ltd v Ambridge Investments Pty Ltd & Ors.[2]

   [2][2003] VSC 478.

1. The Court’s power to award costs under s 24(1) of the Supreme Court Act 1986 is in the discretion of the Court and must be exercised judicially.  The usual rule is that costs follow the event.  In Oshlack v Richmond River Council, McHugh J stated that the expression the ‘usual order as to costs’:[3]

… embodies the important principle that, subject to certain limited exceptions, a successful party in litigation is entitled to an award of costs in its favour.  The principle is grounded in reasons of fairness and policy and operates whether the successful party is the plaintiff or the defendant.  Costs are not awarded to punish an unsuccessful party.  The primary purpose of an award of costs is to indemnify the successful party.  If the litigation had not been brought, or defended, by the unsuccessful party the successful party would not have incurred the expense which it did.  As between the parties, fairness dictates that the unsuccessful party typically bears the liability for the costs of the unsuccessful litigation.

[3](1998) 193 CLR 72, [67].

1. In exercising my discretion as to costs, it is also necessary to have regard to the interlocutory nature of the application brought by the plaintiffs.  As noted by Hollingworth J in Dale v Clayton Utz (No 3),[4] it is common following the grant or dismissal of an application for interlocutory relief that costs be ordered to be in the proceeding, or be reserved.  This is because there may be reasons why a party may, for example, fail at an interlocutory stage, but succeed at trial.  Her Honour continued:[5]

But, once again, that common practice may not prevail in every case. If an interlocutory injunction is refused, it may be necessary to have regard to the reason for refusal; for example, if the application fails because the applicant has not even established a prima facie case, a court may be more willing to order costs against the unsuccessful applicant, than in a case where the applicant fails on the balance of convenience, or on a discretionary ground.

[4][2013] VSC 593, [18].

[5]Ibid, [19].

1. However, in this case, not only did the plaintiffs fail in their application for an interlocutory injunction, they failed to establish a prime facie case.  That circumstance provides a proper basis in my view for why the defendant should have the benefit of a costs order in his favour. It also distinguishes this matter from Tower Australia Ltd v Ambridge Investments Pty Ltd & Ors relied upon by the plaintiffs.

1. Although the plaintiffs failed to make out a prima facie case, I do not however consider that the circumstances of the case warrant an award of indemnity costs as sought by the defendant.  Having regard to the range of circumstances where indemnity costs may be awarded as referred to by Harper J in Ugly Tribe Co Pty Ltd v Sikola[6] and noting that the categories are not closed, when the application was brought by the plaintiff I do not consider that the state of the authorities dictated a conclusion that the plaintiffs’ case was always destined to fail.  In particular, the observations of Derham AsJ in Avery v Manno,[7] upon which the plaintiffs relied, provided some basis for the application to be brought.  My reasons for judgment explain why his Honour’s remarks must, however, be read as being subject to the observations of the Court of Appeal in Morris v Smoel.[8]

   [6][2001] VSC 189, [7]–[8].

   [7](2020) 62 VR 281.

   [8][2013] VSCA 11.

1. The defendant is accordingly entitled to his costs on a standard basis. As executor of the estate of Colin Graeme Mole, the defendant should be at liberty to deduct these costs from the plaintiffs’ respective shares in the residue of the deceased’s estate pro rata.

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