Muhibbah Engineering (M) BHD v Trust Co Ltd - [2009] NSWCA 205

New South Wales

Court of Appeal

CITATION: Muhibbah Engineering (M) BHD & Anor v Trust Company Ltd & Anor [2009] NSWCA 205

HEARING DATE(S): 13/07/09

JUDGMENT DATE:
27 July 2009

JUDGMENT OF: Young JA at 1; Handley AJA at 19; Sackville AJA at 47

DECISION: Appeal dismissed with costs.

CATCHWORDS: COSTS - proceedings for breach of injunction - settled on undertakings without admissions - no hearing on merits - judge orders defendant to pay costs of proceedings - judge concluding defendant acted unreasonably - conclusion open without hearing on merits.

LEGISLATION CITED: Civil Procedure Act 2005 (NSW) s 98
Conveyancing Act, s 88K

CASES CITED: Chapman v Luminis Pty Ltd [2003] FCAFC 162
ONE.TEL Ltd v Deputy Commissioner of Taxation [2000] FCA 270
R v Gold Coast City Council; Ex parte Raysun Pty Ltd [1971] QWN 13

PARTIES: Muhibbah Engineering (M) BHD - Apellant
The Trust Company Limited - Respondent

FILE NUMBER(S): CA 40330/08

COUNSEL: G A Sirtes SC - Appellant
D A Stack - Respondent

SOLICITORS: Gray & Perkins, Sydney - Appellant
Deacons, Sydney - Respondent

LOWER COURT JURISDICTION: Supreme Court

LOWER COURT FILE NUMBER(S): SC 5922/2007

LOWER COURT JUDICIAL OFFICER: Debelle AJ

LOWER COURT DATE OF DECISION: 11/09/2008

CA 40330/08

YOUNG JA
HANDLEY AJA
SACKVILLE AJA
Monday 27 July 2009

MUHIBBAH ENGINEERING (M) BHD & ANOR v TRUST COMPANY LIMITED

Catchwords

COSTS - proceedings for breach of injunction - settled on undertakings without admissions - no hearing on merits - judge orders defendant to pay costs of proceedings - judge concluding defendant acted unreasonably - conclusion open without hearing on merits.

Headnote

On 12 December 2007 White J made orders restraining the appellant from allowing stormwater to discharge from its pipes on to the respondents’ property. Contempt proceedings were commenced on 4 April 2008 alleging repeated breaches. The proceedings were heard on 10 September 2008. It was common ground that a permanent solution to the drainage problem had not yet been achieved. At the end of counsel's opening, before any evidence was read, the judge intervened in an endeavour to assist the parties to work out a permanent solution. His intervention was successful and the appellant gave undertakings without admissions which were intended to achieve that result. The parties could not agree on costs, and without hearing the contempt proceedings on their merits, or taking evidence, the judge ordered the appellant to pay the costs of the motion. On appeal by leave granted Held By majority: Having heard the parties’ submissions on costs the judge was entitled to conclude that the appellant had acted unreasonably and to make the costs order he did: Re Minister for Immigration and Ethnic Affairs ex parte Lai Quin (1997) 186 CLR 622, 624 applied.

Order

Appeal dismissed with costs.

CA 40330/08

YOUNG JA
HANDLEY AJA
SACKVILLE AJA
Monday 27 July 2009

MUHIBBAH ENGINEERING (M) BHD & ANOR v TRUST COMPANY LIMITED

Judgment

1 YOUNG JA: I have read in draft the reasons of Handley AJA and Sackville AJA.

2 I…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2009] NSWCA 205
Decision Date: 27 July 2009

CaseChat Overview and Summary

The New South Wales Court of Appeal considered an appeal concerning the costs of proceedings that had been settled on undertakings without admissions. The dispute arose from an application for an injunction, which was ultimately resolved without a hearing on the merits. The primary judge had ordered the defendant to pay the costs of the proceedings, having concluded that the defendant had acted unreasonably.

The central legal issue before the Court of Appeal was whether the primary judge had erred in ordering the defendant to pay costs, despite the settlement of the proceedings on undertakings without admissions and without a determination of the substantive issues. Specifically, the court had to consider whether the primary judge's conclusion that the defendant acted unreasonably was a finding that could be made in the absence of a full hearing on the merits.

The Court of Appeal reasoned that a judge is entitled to conclude that a party has acted unreasonably in the conduct of litigation, even if the proceedings are settled without admissions and without a hearing on the merits. Such a conclusion can be based on the circumstances surrounding the settlement and the conduct of the parties leading up to it. The court found that the primary judge's conclusion that the defendant acted unreasonably was open to them on the material before them.

The appeal was dismissed, and the defendant was ordered to pay the costs of the appeal.

Orders

Orders of the court

Appeal dismissed with costs.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Muhibbah Engineering (M) BHD & Anor v Trust Company Ltd & Anor [2009] NSWCA 205
HEARING DATE(S):	13/07/09
JUDGMENT DATE:	27 July 2009
JUDGMENT OF:	Young JA at 1; Handley AJA at 19; Sackville AJA at 47
DECISION:	Appeal dismissed with costs.
CATCHWORDS:	COSTS - proceedings for breach of injunction - settled on undertakings without admissions - no hearing on merits - judge orders defendant to pay costs of proceedings - judge concluding defendant acted unreasonably - conclusion open without hearing on merits.
LEGISLATION CITED:	Civil Procedure Act 2005 (NSW) s 98 Conveyancing Act, s 88K
CASES CITED:	Chapman v Luminis Pty Ltd [2003] FCAFC 162 ONE.TEL Ltd v Deputy Commissioner of Taxation [2000] FCA 270 R v Gold Coast City Council; Ex parte Raysun Pty Ltd [1971] QWN 13
PARTIES:	Muhibbah Engineering (M) BHD - Apellant The Trust Company Limited - Respondent
FILE NUMBER(S):	CA 40330/08
COUNSEL:	G A Sirtes SC - Appellant D A Stack - Respondent
SOLICITORS:	Gray & Perkins, Sydney - Appellant Deacons, Sydney - Respondent
LOWER COURT JURISDICTION:	Supreme Court
LOWER COURT FILE NUMBER(S):	SC 5922/2007
LOWER COURT JUDICIAL OFFICER:	Debelle AJ
LOWER COURT DATE OF DECISION:	11/09/2008