Network Ten Pty Ltd v TX Australia Pty Ltd (No 2) - [2019] NSWCA 51

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Network Ten Pty Ltd v TX Australia Pty Ltd (No 2) [2019] NSWCA 51
Hearing dates: On the papers
Date of orders: 22 March 2019
Decision date: 22 March 2019
Before: Bathurst CJ at [1]; Meagher JA at [23]; Gleeson JA at [24]
Decision:
(1) Order that the second and third respondents pay the appellant’s costs of the appeal and 50% of the appellant’s costs in the Court below.

Catchwords:
COSTS – Party/Party – Exception to general rule that costs follow the event – apportionment – whether issues on which successful party was unsuccessful were clearly dominant or separable
COSTS – Party/Party – Bases of quantification – Indemnity basis
Legislation Cited: Civil Procedure Act 2005 (NSW)
Corporations Act 2001 (Cth)
Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited: Baker v Towle [2008] NSWCA 73
Cellarit Pty Ltd v Cawarrah Holdings Pty Ltd (No 2) [2018] NSWCA 266
Monie v Commonwealth of Australia (No 2) [2008] NSWCA 15
Network Ten Pty Ltd v TX Australia Pty Ltd [2018] NSWCA 312
Category: Costs
Parties: Network Ten Pty Ltd (applicant)
TX Australia Pty Ltd (first respondent)
Nine Network Australia Pty Ltd (second respondent)
Seven Network (Operations) Ltd (third respondent)
Representation:
Counsel:
N Hutley SC with A Hochroth (applicant)
A Bell SC with D Thomas (first respondent)
K Williams SC with R Mansted (second respondent)
D Sulan with K Petch (third respondent)
Solicitors:
Corrs Chambers Westgarth Lawyers (applicant)
Herbert Smith Freehills (first respondent)
DLA Piper Australia (second respondent)
Addisons Lawyers (third respondent)

File Number(s): 2018/150490
Publication restriction: Nil
Decision under appeal

Court or tribunal:

Supreme Court of New South Wales

Jurisdiction:

Equity

Citation:

[2018] NSWSC 559

Date of Decision:

1 May 2018

Before:

Stevenson J

File Number(s):

2018/39929

Judgment

BATHURST CJ: These proceedings concerned an appeal from a judge in the Equity Division in which his Honour made a declaration that the first respondent, TX Australia Pty Ltd (TXA) was required to register the transfer of shares held in it by Network Ten Pty Ltd (Ten) to the second and third respondents, Nine Network Australia Pty Ltd (Nine) and Seven Network (Operations) Ltd (Seven) in equal proportions. The transfer was for nominal consideration.
The case concerned certain pre-emptive rights provisions in a Shareholders Agreement between TXA, Ten, Nine and Seven (the Shareholders Agreement). The transfer of shares was said to be required by the Shareholders Agreement as a consequence of the appointment of a receiver and manager to Ten, whilst the “nil” or nominal consideration payable by Nine and Seven for Ten’s shares was said to arise from a determination made by TXA’s auditor pursuant to the Shareholders Agreement.
In Network Ten Pty Ltd v TX Australia Pty Ltd [2018] NSWCA 312, the appeal was allowed and the proceedings brought by TXA dismissed. The basis on which the appeal was allowed was that the auditor did not in fact determine the price payable as required by the Shareholders Agreement.
The parties have…

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: [2019] NSWCA 51
Decision Date: 22 March 2019

CaseChat Overview and Summary

Network Ten Pty Ltd (the appellant) appealed to the Court of Appeal of the Supreme Court of New South Wales against orders made by the primary judge concerning the costs of proceedings against TX Australia Pty Ltd and others (the respondents). The dispute arose from earlier proceedings where the appellant had been largely unsuccessful.

The primary legal issues before the Court of Appeal were whether the general rule that costs follow the event should be departed from, and if so, how costs should be apportioned. Specifically, the court considered whether the issues on which the appellant was unsuccessful were so dominant or separable from the issues on which it was successful as to warrant a departure from the usual order. The court also considered the basis upon which costs should be quantified, including the possibility of an indemnity basis.

The Court of Appeal reasoned that while the appellant had been unsuccessful on most of the substantive issues, it had achieved some success. The court determined that the issues on which the appellant failed were not so clearly dominant or separable as to justify a complete departure from the general rule. Accordingly, the court ordered that the respondents pay the appellant's costs of the appeal and 50% of the appellant's costs in the Court below, reflecting a partial success for the appellant in the appeal and a mixed outcome in the primary proceedings.

Orders

Orders of the court

(1) Order that the second and third respondents pay the appellant’s costs of the appeal and 50% of the appellant’s costs in the Court below.

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.

Medium Neutral Citation:	Network Ten Pty Ltd v TX Australia Pty Ltd (No 2) [2019] NSWCA 51
Hearing dates:	On the papers
Date of orders:	22 March 2019
Decision date:	22 March 2019
Before:	Bathurst CJ at [1]; Meagher JA at [23]; Gleeson JA at [24]
Decision:	(1) Order that the second and third respondents pay the appellant’s costs of the appeal and 50% of the appellant’s costs in the Court below.
Catchwords:	COSTS – Party/Party – Exception to general rule that costs follow the event – apportionment – whether issues on which successful party was unsuccessful were clearly dominant or separable COSTS – Party/Party – Bases of quantification – Indemnity basis
Legislation Cited:	Civil Procedure Act 2005 (NSW) Corporations Act 2001 (Cth) Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited:	Baker v Towle [2008] NSWCA 73 Cellarit Pty Ltd v Cawarrah Holdings Pty Ltd (No 2) [2018] NSWCA 266 Monie v Commonwealth of Australia (No 2) [2008] NSWCA 15 Network Ten Pty Ltd v TX Australia Pty Ltd [2018] NSWCA 312
Category:	Costs
Parties:	Network Ten Pty Ltd (applicant) TX Australia Pty Ltd (first respondent) Nine Network Australia Pty Ltd (second respondent) Seven Network (Operations) Ltd (third respondent)
Representation:	Counsel: N Hutley SC with A Hochroth (applicant) A Bell SC with D Thomas (first respondent) K Williams SC with R Mansted (second respondent) D Sulan with K Petch (third respondent) Solicitors: Corrs Chambers Westgarth Lawyers (applicant) Herbert Smith Freehills (first respondent) DLA Piper Australia (second respondent) Addisons Lawyers (third respondent)
File Number(s):	2018/150490
Publication restriction:	Nil
Decision under appeal	Court or tribunal: Supreme Court of New South Wales Jurisdiction: Equity Citation: [2018] NSWSC 559 Date of Decision: 1 May 2018 Before: Stevenson J File Number(s): 2018/39929