Mora Group Investments Pty Ltd v Sammour

[2022] NSWSC 45

Supreme Court

New South Wales

Medium Neutral Citation:	Mora Group Investments Pty Ltd v Sammour [2022] NSWSC 45
Hearing dates:	On the papers
Date of orders:	2 February 2022
Decision date:	02 February 2022
Jurisdiction:	Equity
Before:	Darke J
Decision:	Order that each party’s costs in respect of the Summons be treated as that party’s costs in respect of the Cross-Summons.
Catchwords:	COSTS – Summons for removal of caveat – no determination on the merits – order made by consent for removal of caveat – agreement for preservation of proceeds of sale pending further agreement or order of the Court – Cross-Summons filed seeking proprietary relief in respect of proceeds of sale – order made that each party’s costs in respect of the Summons be treated as that party’s costs in respect of the Cross-Summons
Category:	Costs
Parties:	Mora Group Investments Pty Ltd (Plaintiff) Joe Sammour (Defendant)
Representation:	Counsel: Mr J Pokoney (Plaintiff) Solicitors: Deutsch Partners (Plaintiff) Fortis Law (Defendant)
File Number(s):	2021/341210
Publication restriction:	None

Judgment

1. These proceedings were commenced by Summons filed on 1 December 2021. The plaintiff sought an order pursuant to s 74MA of the Real Property Act 1900 (NSW) requiring the defendant to remove a caveat he had lodged against the titles to two properties owned by the plaintiff. By the caveat (AR576249) the defendant claimed an interest in the properties in the nature of a charge, said to arise by virtue of a Deed of Settlement dated 12 April 2017. The caveat was lodged on about 2 November 2021. By that time, one of the properties was the subject of a contract for sale to a third party.

2. The Summons was made returnable on short notice on 3 December 2021. On that day directions were made for the service of evidence, and the matter was set down for hearing on 14 December 2021.

3. On 14 December 2021 the Court made various orders by consent and without admissions, including an order requiring the caveat to be withdrawn at the impending settlement of the contract for sale. The Court also noted an agreement reached between the parties to the effect that if the defendant commenced proceedings seeking proprietary relief in respect of the proceeds of sale of the properties (by 4:00pm on 16 December 2021) the plaintiff would, inter alia, cause certain of any proceeds to be deposited into a trust account and not disburse such proceeds (other than to pay taxation liabilities) without the agreement of the defendant or pursuant to an order of the Court.

4. There was no agreement as to the costs of the proceedings. A direction was made for written submissions to be filed, and for that question to be dealt with on the papers.

5. On 16 December 2021 (prior to 4:00pm) the defendant filed a Cross-Summons in the proceedings by which a declaration was sought that the proceeds of any sale of the properties are subject to a charge in favour of the defendant. It therefore seems that the condition for the plaintiff’s agreement in respect of the proceeds of sale was duly satisfied.

6. The Court has considered the written submissions that were filed in accordance with the Court’s direction. In brief, the plaintiff seeks an order in its favour for its costs of the Summons, or alternatively that its costs be costs in the cause of the Cross-Summons. The defendant resists any costs order in favour of the plaintiff, and submits that the appropriate order is that its costs be costs in the cause of the Cross-Summons, or alternatively that all costs should be costs in that cause, or that there be no order as to costs.

7. The plaintiff accepts that its claim for relief was not the subject of a determination on the merits. However, the plaintiff submits that it would nonetheless be appropriate to award costs in its favour because it was compelled to commence the proceedings and the relief it sought was effectively granted.

8. It is true that the plaintiff had entered into a contract for sale prior to the lodgement of the caveat. The intrusion of the caveat created an impediment to completion of the contract and required the plaintiff to take action in order to get into a position to settle. In that sense, the plaintiff was compelled to take action in relation to the caveat. Moreover, the defendant refused to withdraw his caveat when asked to do so prior to the commencement of the proceedings. Nevertheless, in the absence of a hearing on the merits, and having regard to the agreement reached between the parties on 14 December 2021, it cannot be said that the defendant was acting unreasonably. I note further that the defendant made offers to the plaintiff on 1 December 2021 and 8 December 2021 that would (or would likely) entail the withdrawal of the caveat.

9. It is also true that the plaintiff obtained an order for the withdrawal of the caveat. However, this order was made by consent in the context of a broader agreement involving the preservation of the proceeds of any sales of the relevant properties. As submitted by the defendant, there was no capitulation.

10. In all the circumstances, I do not think that it would be appropriate to make an order that the defendant pay the plaintiff’s costs of the Summons. I consider that the appropriate order is that the costs of each party in respect of the Summons be treated as that party’s costs in respect of the Cross-Summons. Neither party appears to me to have acted unreasonably in relation to the Summons proceedings. Those proceedings, which involved an application under s 74MA of the Real Property Act, are akin to an application for an interlocutory injunction (recognising, of course, that the onus in a s 74MA application rests upon the caveator defendant rather than the plaintiff). That application was disposed of in accordance with an agreement ultimately reached by the parties, and in a fashion that would preserve any proceeds of sale pending the further agreement of the parties or order of the Court. It seems to me that it would be appropriate for the costs of this application to essentially depend upon the outcome of the proceedings on the Cross-Summons. An order to that effect will be made. The Cross-Summons will be listed for directions on 18 February 2022.

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Decision last updated: 02 February 2022