Nicholson v Owners of the Vessel “The Sea-Ya”
[2005] FCA 614
•16 MAY 2005
FEDERAL COURT OF AUSTRALIA
Nicholson v Owners of the Vessel “The Sea-Ya” [2005] FCA 614
NICHOLSON AND ANOR v OWNERS OF THE VESSEL 42’ RIVIERA FLYBRIDGE CRUISER REGISTRATION NUMBER JMG 42N “THE SEA-YA”
NSD 1974 OF 2004ALLSOP J
16 MAY 2005
SYDNEY
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
NSD 1974 of 2004
BETWEEN:
MARK NICHOLSON
FIRST PLAINTIFF/ THIRD CROSS DEFENDANTBRONWYN NICHOLSON
SECOND PLAINTIFF/ THIRD CROSS DEFENDANTAND:
PETER ZIZZA AS OWNER OF THE VESSEL 42’ RIVIERA FLYBRIDGE CRUISER REG NUMBER JMG 42N
"THE SEA-YA"
DEFENDANT/ CROSS CLAIMANTDES LAST PTY LIMITED TRADING AS SYDNEY BOAT SALES
FIRST CROSS DEFENDANTDESMOND LAST
SECOND CROSS DEFENDANTJUDGE:
ALLSOP J
DATE OF ORDER:
16 MAY 2005
WHERE MADE:
SYDNEY
THE COURT ORDERS THAT:
1.With the exception of any costs properly referable to the arrest of the vessel, the plaintiffs and the defendant pay their own costs of the proceeding to date.
2.As to the costs of the cross-claim by the defendant against the first and second cross defendants, the cross claimant (the defendant) pay the costs of the first and second cross-defendants on an indemnity basis with the specific intention that all costs of the first and second cross-defendants be paid by the cross-claimant (the defendant) except such costs as were clearly unreasonably and unnecessarily incurred by those cross-defendants.
3.The time for filing and serving a notice of appeal or any application for leave to appeal against any orders made on 15 March 2005 or 16 May 2005 be extended, nunc pro tunc, up to and including 23 May 2005.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
NSD 1974 of 2004
BETWEEN:
MARK NICHOLSON
FIRST PLAINTIFF/ THIRD CROSS DEFENDANTBRONWYN NICHOLSON
SECOND PLAINTIFF/ THIRD CROSS DEFENDANTAND:
PETER ZIZZA AS OWNER OF THE VESSEL 42’ RIVIERA FLYBRIDGE CRUISER REG NUMBER JMG 42N
"THE SEA-YA"
DEFENDANT/ CROSS CLAIMANTDES LAST PTY LIMITED TRADING AS SYDNEY BOAT SALES
FIRST CROSS DEFENDANTDESMOND LAST
SECOND CROSS DEFENDANT
JUDGE:
ALLSOP J
DATE:
16 MAY 2005
PLACE:
SYDNEY
REASONS FOR JUDGMENT
On 15 March 2005, I made orders in this proceeding standing over the question of costs to be argued at a date to be fixed.
These reasons should be read with my reasons for judgment in this matter dated 15 March 2005.
On 28 April 2005, I heard argument about costs.
The reason that I do not think that costs should follow the event ought be plain from a reading of my reasons for judgment delivered on 15 March 2005.
The plaintiffs have failed in their contention that there was a binding contract between them and the defendant for the sale of the vessel “The Sea Ya”. That claim of the existence of a presently binding contract was the basis of the claim for the arrest of the vessel, which arrest was made in December 2004.
I previously made an order under Order 29 of the Federal Court Rules separating out the question of the claim for wrongful arrest made in the cross claim by the defendant against the plaintiffs. That matter is yet to be dealt with and is not the subject of these reasons or the orders I make today.
Although the plaintiffs have failed they failed for reasons not related to the lack of existence of a consensus ad idem. Rather, I was of the view that the circumstances were such as not to enable one to conclude that the reasonable bystander to the transaction as it unfolded would have been of the view that the parties intended that their consensus ad idem (which was reached) would be legally binding until there was a written agreement signed by both sides. In coming to this view, as I attempted to make clear in my earlier reasons, I rejected fundamentally and comprehensively the evidence of Mr Zizza. Given the recency of the events and the starkness of the differences in the evidence it is necessary in these reasons to say that I do not think that Mr Zizza’s inaccuracy of evidence was accidental. In my view, much of his evidence in important respects was false and deliberately so. The case proceeded for seven hearing days and part of another day in which I delivered my reasons orally. If Mr Zizza had not propounded the case that he had, and if he had propounded the case, which I find to be reasonably conformable with the facts as I found them, the length of the case would have been significantly shorter. It certainly would not have taken seven days to hear. Much of the hearing time was taken up in the dispute instituted by Mr Zizza’s evidence as to what had happened in the months leading up to December 2004.
If Mr Zizza had not propounded, what I have found to be false evidence, the case would have taken some time to ascertain whether or not the parties intended what had happened to be legally binding. Some of the cross-examination of the brokers would have taken place. A cross examination of Mr Nicholson would have taken place. A cross examination of Mr Zizza would have taken place. However, none of those cross-examinations would have been of the length each was. It is difficult to estimate and it is difficult to be certain, however, in my view, the case would not have lasted any longer than “three days plus” rather than the seven days that it did.
The discretion under s 43 of the Federal Court of Australia Act 1976 (Cth) as to costs is a wide one. It includes the possibility of splitting the costs of a hearing where one side has won the ultimate result but the circumstances dictate that the costs should be divided in some fashion other than following the event. Whilst such a division of costs should not be lightly made, in my view, this is an appropriate case for the exercise of the discretion in that way. As I have said, Mr Zizza’s evidence was false. The falsity of that evidence led to a significant increase in the public and private expenditure required to quell this controversy. Litigation is not a game. It is a stressful and costly, but necessary evil. I do not see why Mr Zizza should have the whole of his costs against the Nicholsons in these circumstances. In my view given what would have been the position had Mr Zizza not propounded the evidence he did, in all the circumstances between the plaintiffs and the defendant each party should pay his and her own costs of the proceedings to date other than any costs of the arrest of the vessel which might properly be related to the arrest.
As to the position between Mr Zizza and the brokers, it was put on behalf of Mr Zizza that the brokers should pay Mr Zizza’s costs. This is not withstanding the fact that I found for the brokers on the cross claim against them. These brokers were brought to Court, on my view, on the basis of false evidence. As I said in my reasons of 15 March I do not think they can be criticised in any real way. It is said that they failed to bring forward the evidence, which in cross-examination, I found to be important in resolving the main claim. Humanly speaking, they might be forgiven for the fact that they were replying to assertions on oath by Mr Zizza which were false. In the human conduct of this case, the fact that people were not properly focussing on the issue of the intention to be legally bound can be seen to be brought about by Mr Zizza and his evidence, not the brokers and theirs. In my view, the brokers were quite wrongly brought to this Court. They were subjected to cross-examination of a stressful and unpleasant kind. (I say this without the slightest criticism of counsel for the defendant.) They have undertaken costs which no doubt are significant. If I do not make a special order for costs they will have been wrongfully brought into this litigation based on false evidence and pay for that privilege. In my view, that would be a considerable injustice. The brokers are entitled to have their costs on an indemnity basis. It is a case fitting well within the existing authority since the case should never have been brought against them and was brought on the basis of false evidence. The brokers shall have their costs on an indemnity basis with a view to indemnifying them fully for all costs except for costs found to be clearly unreasonably and unnecessarily expended.
I have been unfortunately delayed in delivering these reasons by reason of the pressure of other work. I have extended time on an earlier occasion for the filing of any notice of appeal or application for leave to appeal. I propose to extend the time already extended to a date seven days after the delivery of these reasons.
Therefore, the orders I make are as follows:
1. With the exception of any costs properly referable to the arrest of the vessel, the plaintiffs and the defendant pay their own costs of the proceeding to date.
2. As to the costs of the cross-claim by the defendant against the first and second cross defendants, the cross claimant (the defendant) pay the costs of the first and second cross-defendants on an indemnity basis with the specific intention that all costs of the first and second cross-defendants be paid by the cross-claimant (the defendant) except such costs as were clearly unreasonably and unnecessarily incurred by those cross-defendants.
3. The time for filing and serving a notice of appeal or any application for leave to appeal against any orders made on 15 March 2005 or 16 May 2005 be extended, nunc pro tunc, up to and including 23 May 2005.
I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Allsop. Associate:
Dated: 16 May 2005
Counsel for the Plaintiffs: Mr G J Nell Solicitor for the Plaintiffs: Ebsworth & Ebsworth Counsel for the Defendant and Cross Claimant: Mr G M Thomas Solicitor for the Defendant and Cross Claimant: R F Bergagnin & Co. Counsel for the Cross Defendants: Mr M W Young Solicitor for the Cross Defendants: Dixon Holmes Du Pont Lawyers Date of Hearing: 28 April 2005 Date of Judgment: 16 May 2005
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