Oh v Cox

[1999] NSWSC 512

CITATION:	Oh v Cox [1999] NSWSC 512
CURRENT JURISDICTION:
FILE NUMBER(S):	11949/98
HEARING DATE(S):	07/09/98, 11/09/98
JUDGMENT DATE:	31 May 1999
PARTIES :	Nell Oh Kenneth Alan Cox
JUDGMENT OF:	Dowd J

COUNSEL :	Plaintiff: Mr Jacobs Q.C. with Mr Bambagiotti Defendant: Mr Scotting
SOLICITORS:	Plaintiff: Gadens Defendant: -
CATCHWORDS:	extension of time for costs application; interim award; no loss of entitlement to seek costs
ACTS CITED:	Commercial Arbitration Act 1984
CASES CITED:	Holiday Villages (Australia) Pty Ltd v Thiess Contractors Pty Ltd (Giles J, 9 April 1998, unreported) Doran Constructions Pty Limited v Health Administration Corporation of New South Wales (Rolfe J, 2 September 1994, unreported) Re: J.W Armstrong Constructions Pty Ltd v Council of the Shire of Cook (White J, 25 FEbruary 1994, unreported) Salido v Nominal Defendant (1993) 32 NSWLR 524 Minenco Pty Ltd v Abigroup Contractors (WA) Pty Ltd (White J, 24 February 1992, unreported) Charlie Brown Ltd v Green; Ecroblake Pty Ltd v Charlie Brown Pty Ltd (McClelland CJ in Esq, 3 July 1995, unreported)
DECISION:	Application for extension of time is refused

- 21 -

THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

DOWD J
Monday 31 May 1999
No. 11949/98

OH -v- COX

REASONS FOR JUDGMENT

1 Arbitration proceedings between the Plaintiff, Nell Oh, and the Defendant, Kenneth Alan Cox, commenced by way of Notice of Dispute dated 6 January 1997, pursuant to the terms of a building contract between the Plaintiff and the Defendant for the renovation of a house at 5 Wolseley Crescent, Point Piper. The dispute concerned whether the Defendant had wrongfully repudiated the building contract. The Defendant had also brought a cross-claim against the Plaintiff for damages for loss of the contract and for particular losses suffered by the Defendant through breaches of the contract allegedly committed by the Plaintiff prior to rescission.
2 The sole arbitrator in the matter held a preliminary conference on 17 March 1997. The arbitration hearing commenced on 17 November 1997.
3 On 2 December 1997, the Arbitrator sent out his first interim award which dealt with a number of preliminary questions of law and set out the questions to be dealt with by the parties in submissions on the question of liability, which was to be separately determined. The first interim award did not deal with the issue of costs.
4 The second interim award, which concerned the repudiation of the building contract, was sent out on 6 June 1998. The Arbitrator found that the Defendant had wrongfully repudiated the building contract. The award further provided that the issue of costs was to be determined following submissions at the conclusion of the matter.
5 The second interim award was received by the Plaintiff’s solicitors on 9 June 1998 and was explained to the Plaintiff on or about 12 June 1998.
6 On 15 June 1998, the Arbitrator advised the parties by letter of a Directions Conference set for 23 June 1998 in order that a timetable for the hearing on the issue of quantum of damages could be devised. The Conference was delayed at the request of the Plaintiff’s solicitors until 7 July 1998. Before the Conference, on 29 June 1998, the Plaintiff had instructed counsel acting on her behalf to make an application for the costs of the interim awards at the Conference on 7 July. However, on 7 July, the Plaintiff’s solicitors requested a further adjournment until 15 July 1998 on the basis that there was new law relating to the Arbitrator’s orders and that the Plaintiff required time to prepare an affidavit and submissions in support of her costs application. The Plaintiff was directed to serve affidavits and submissions by 13 July 1998, a direction with which the Plaintiff complied.
7 At the Conference of 15 July 1998, the Defendant’s cross-claim was dismissed. Counsel for the Plaintiff made an application for an award of costs in favour of the Plaintiff in respect of the first and second interim awards. It was conceded by the Defendant that the Arbitrator had the power to make such an award, however it was argued that s.34(4) of the Act required an application for costs to be made within 14 days of the publication of the relevant award.
8 As a result of the Defendant’s objection to the costs application, and on the motion of counsel for the Plaintiff, the Directions Conference was stood over to enable the Plaintiff to move the Court for orders to extend time for the interim costs application pursuant to s.48(1) of the Act. The Plaintiff requested a further adjournment due to the unavailability of Senior Counsel. The adjournment was consented to and the matter was again stood over.
9 The plaintiff filed a Summons in this Court seeking the orders set out below, the matter being stood over generally, with liberty to restore, pending the outcome of the Summons:
1. An order pursuant to s.48 of the Commercial Arbitration Act 1984 (NSW) (‘the Act’) extending the time in which the Plaintiff may seek an award for costs in respect of the interim awards made in her favour in the arbitration proceedings presently pending between the Plaintiff and the Defendant.

2. An order that the Defendant pay the cost of these proceedings on a party/party basis should these proceedings be unopposed, but should the Defendant oppose these proceedings, that Plaintiff’s costs of these proceedings be awarded against Defendant on an indemnity basis;
3. Further alternative relief as the Court thinks fit.

10 Subsequent to the hearing before this court, the solicitors for the Plaintiff requested the opportunity to make further submissions on the matter of alternative orders as sought in paragraph 3 of the Summons, should the Court decline to make the order in paragraph 1, extending the time for an interim costs application, and foreshadowed the Plaintiff would seek a declaration that the provisions of s.34(4) of the Commercial Arbitration Act 1984 (“the Act”) would not prevent the Plaintiff applying for, and being awarded, in the arbitrator’s final award, her costs in respect of the second interim award.
11 Section 48(1) of the Act provides as follows:
“Extension of Time

48(1) Subject to subsection (3), the Court shall have power on the application of a party to an arbitration agreement or an arbitrator or umpire to extend the time appointed by or under this Act or fixed by the agreement or by an order under this section for doing any act or taking any proceeding in or in relation to an arbitration.
(2) The Court may make an order under this section although an application for the making of the order was not made until after the expiration of the time appointed or fixed for doing the act or taking the proceeding.
(3) An order shall not be made under this section extending the time within which arbitration proceedings might be commenced unless:
(a) the Court is satisfied that in the circumstances of the case undue hardship would otherwise be caused; and
(b) the making of the order would not contravene the provision of any enactment limiting the time for the commencement of arbitration proceedings.

12 The arbitrator’s power to award costs is set out in s.34 of the Act, the relevant subsections of which are set out below:
“Costs

34. (1) Unless a contrary intention is expressed in the arbitration agreement, the costs of the arbitration (including the fees and expenses of the arbitrator or umpire) shall be in the discretion of the arbitrator or umpire, who may:
(a) direct to and by whom and in what manner the whole or any part of those costs shall be paid;
(b) tax or settle the amount of costs to be so paid or any par of those costs; and
(c) award costs to be taxed or settled as between party and party or as between solicitor and client.
…….
(4) If no provision is made by an award with respect to costs of the arbitration, a party to the arbitration agreement may, within 14 days of the publication of the award, apply to the arbitrator or umpire for directions as to the payment of those costs, and thereupon the arbitrator or umpire shall, after hearing any party who wishes to be heard, amend the award by adding to it such directions as the arbitrator or umpire may think proper with respect to costs of the arbitration.”

13 Part 72A r12(1) SCR requires an arbitrator to make an interim award dealing with all questions of liability and the relief to be granted without an accompanying order for costs to allow both parties to make submissions on the issue of costs:
“R12 (1) In arbitration proceedings the arbitrator shall, unless the parties otherwise request, make an interim award dealing with all questions of liability and the relief to be granted and, before making any provision in an award with respect to the costs of the arbitration, give the parties an opportunity to be heard on the question of the costs of the arbitration.”
14 Section 23 of the Act permits an interim award, which by implication permits an award dealing with any aspect of the arbitration.
15 The word “award” in s.34(4) also means an interim award and therefore an arbitrator has power to make a costs award in relation to an interim award (Holiday Villages (Australia) Pty Ltd v Thiess Contractors Pty Ltd (Giles J, 9 April 1998, unreported)).
16 The reference to “publication” in s.34(4) can only to refer to the date on which the party wishing to “apply” receives notice of the award as contended in Jacobs, Commercial Arbitration Law and Practice, para [32.320]. The interpretation of the word “apply” seems to be one which refers to the date on which notice of the application is given, rather than the date on which the issue is actually argued before the arbitrator and in that respect I adopt the contention to that effect in Jacobs.
17 In relation to timing, therefore, and based on the above guidelines to interpreting s.34(4), a costs application should have been made by the Plaintiff by 17 December 1997 in respect of the first interim award (received by the Plaintiff’s solicitors on 3 December 1997), and by 23 June 1998 in respect of the second interim award (received by the Plaintiff’s solicitors on 9 June 1998).
18 The essence of the Plaintiff’s argument was that the time for the making of the interim costs application should be extended pursuant to s.48(1) of the Act, because otherwise the Plaintiff would lose her right to costs in respect of the interim awards completely.
19 This argument was based on the Plaintiff’s understanding of the interpretation of s.34(4) of the Act in the decision of Giles J in Holiday Villages. In Holiday Villages, an interim award on a discrete issue had been made by an arbitrator in favour of Thiess, Holiday Villages having made a Calderbank offer to Thiess in respect of the whole of the claim. The question that arose was whether or not the arbitrator had the power to award costs of the interim award on the discrete issue until an interim award dealing with all questions of liability and the relief to be granted had been made and the parties had been given an opportunity to be heard on the costs of the arbitration. His Honour held that if a party to an arbitration wanted to protect itself from costs consequences, an offer of settlement should be made in respect of the subject matter of the interim award itself, rather than in respect of the whole arbitration. The Plaintiff referred to the following passage of the judgment of Giles J at pps.11-12:
“The core power to award costs is found in s.34(4). Section 34(4) recognises that an award may include a costs award, but provides that if it does not include a costs award a party may immediately apply for directions as to the payment of “the costs of the arbitration”. The language of directions is explained by s.34(1)(a), and in these reasons I refer to a costs award. The arbitrator must then make a costs award by amending the award. By force of the definition, “award” in s.34(4) includes an interim award, and the reference in s.34(4) to the costs of the arbitration must be to the costs in relation to the award or the interim award, as the case may be. Thus far, therefore, an arbitrator has power to make a costs award in relation to an interim award: indeed, he may be required to do so pursuant to s.34(4).

The effect of r12(1) is that an arbitrator shall not include in his award as to liability and relief any provision with respect to the costs of the arbitration, but must first make an interim award and then hear the parties as to costs. Section 34(4) will always apply, because the award to which it refers can not make provision with respect to the costs of the arbitration. But r12(1) does not give a different meaning to “ the costs of the arbitration ”. It means the costs in relation to the interim award to which it refers, which may be concerned with all claims the subject of the arbitration (so that the interim award precedes an award) or with some only of the claims the subject of the arbitration (so that the interim award precedes an interim award). The words “ all questions of liability and the relief to be granted ” refer to liability and relief on the claims with which the award or interim award will deal. Nothing in r12(1) cuts down an arbitrator’s power to make a costs award in relation to an interim award.”

20 His Honour continued at p.14:
“A respondent might go badly on the interim award and suffer a costs award, go well on the remaining claims and keep the claimant’s overall recovery below the amount of a global offer of compromise, but be left with a greater cost burden than warranted because the earlier costs award must stand; the risk can not effectively be dealt with by requesting the arbitrator to defer the costs award, because the arbitrator can not be told of the global offer of compromise. In practice, however, an interim award does not come unexpectedly. The parties have the opportunity to make offers of compromise specific to the claims the subject of the interim award, and if a party were disadvantaged it would be because the party did not, in the light of s.34(6) understood in the manner earlier described, make a specific offer of compromise. It may also be that the Court’s ability to dispense with compliance with any of the requirements of the Rules would enable it to make an order whereby the arbitrator could be told of the global offer of compromise, in support of a request that he defer the costs award.”
21 Counsel for the Plaintiff relied on Doran Constructions Pty Limited v Health Administration Corporation of New South Wales (Rolfe J, 2 September 1994, unreported) in which it was held by Rolfe J at p.23:
“In my opinion the terms used in the Act have been imported into the rules and “Award” in the Act is defined as including “an Interim Award”. It was further submitted that the time for challenging an Interim Award does not arise until a final award is made. I reject this submission on the language of the Act, and for the reason that an Interim Award may be the final award.”
22 It was submitted by counsel for the Plaintiff that the interpretation of Giles J as to s.34(4) and Rolfe J’s comments on the nature of an interim award necessarily meant that a party could not, at the end of a matter, ask for costs in an interim award any more than that party could appeal against the interim award when the whole matter was over. It was submitted, therefore, that if an application for costs in respect of an interim award was not made within the time limit imposed by s.34(4), the Plaintiff’s entitlement to those costs would be lost, and therefore the Court should extend time pursuant to its power in s.48(1) of the Act to ensure that this entitlement is not lost forever.
23 Further support for the Plaintiff’s interpretation of s.34(4) is provided by the Queensland Supreme Court decision in Re J.W. Armstrong Constructions Pty Ltd v Council of the Shire of Cook (White J, 25 February 1994, unreported)), in which White J held:
“It seems to me that the approach of the arbitrator was correct that the question of costs in relation to the interim award, based as it was on agreed statements of fact and formulated questions of law, should be dealt with and not left to the outcome of the arbitration.”
24 Counsel for the Defendant’s preliminary point was that the arbitrator in this present case had reserved the question of costs until the end of the matter, and it was submitted that this constituted a “provision by an award with respect to costs” in accordance with s.34(4). It was submitted that an award making “provision” for costs did not necessarily mean that costs had been awarded in favour of one party or another. Therefore, since an application under s.34(4) is dependent on “no provision” with respect to costs having been made, it was argued that the Plaintiff was precluded from applying for an interim costs order pursuant to s.34(4).
25 In addition, the Defendant disputed the Plaintiff’s interpretation of s.34(4). It was argued that the wording of s.34(4) of the Act did not prevent the Plaintiff from having the question of costs dealt with at the conclusion of the matter. It was submitted that s.34(1) effectively gives the arbitrator the opportunity to deal with costs at the end of the case, thus an award of costs in respect of an interim award would be able to be dealt with at that time. Further, there was nothing in s.34(4) to prevent the arbitrator saying, “I direct payment of costs to be determined after the hearing,” which would be consistent with the interpretation of s.34(4) that the issue of costs in respect of an interim award need not necessarily be dealt with straight away in order that an entitlement to costs continues.
26 In response to this argument, counsel for the Plaintiff referred to the transcript of the Directions Conference of 15 July 1998. It was submitted that counsel for the Defendant had, at the Directions Conference, effectively told the arbitrator that the Plaintiff had “blown” her right to seek an order for costs for the interim award for all time (p.6, line 20 ff.). Therefore, it was submitted that counsel for the Defendant could not now argue that the Plaintiff’s interpretation of s.34(4) was misconceived.
27 Furthermore, the Plaintiff argued that the Defendant could not argue both that “provision” had been made for costs and that the application for a costs award was out of time because these two arguments were mutually exclusive.
28 The question of whether the Court should exercise its discretion and extend time pursuant to s.48(1) will depend upon the facts and circumstances of each case. Some of the discretionary matters to be taken into account are (refer Jacobs, paras [45.340]-[45.420]):
(a) Delay in bringing an application for relief - a deliberate delay will militate against the applicant;

(b) The strength of the applicant’s claim, although the Court should not necessarily endeavour to form a view of the chances of the applicant’s success;
(c) Whether the applicant can still litigate the claim if time is not extended;
(d) Whether there was a deliberate disregard of the limitation provision by the applicant;
(e) Whether the applicant has litigation pending in another jurisdiction;
(f) Whether there was a misunderstanding about the existence of the time-barring clause or whether the respondent’s conduct misled the applicant as to the nature of the time-barring clause;
(g) The degree of fault on the part of the applicant leading to the claim being time-barred.

29 In Doran Constructions (supra) Rolfe J outlined the ingredients of a successful application to extend time under s.48(1) at p.23:
(a) explanation for delays;

(b) a substantial point to be argued;
(c) demonstration of injustice if the applicant is prevented from arguing the point.

30 His Honour also stated at p.22:
“It seems to me that one must also have regard to the requirement that, generally speaking, proceedings under the Act should be determined in accordance with the obvious intendment of it to bring about, save in exceptional circumstances, a final determination of matters as between the parties in conformity with their agreement to submit to arbitration.”
31 Both parties made their own submissions as to the discretionary factors which should be considered by the Court when determining whether to exercise its discretion under s.48(1) of the Act. Counsel for the plaintiff emphasised that ss.48(1) and (2) of the Act are remedial in the nature and were intended to give the Court a wide discretion to extend any time limit, whether contractual, statutory, or set in orders by the arbitrator.
32 It was submitted for the Plaintiff that the Court, in deciding whether to exercise its discretion under s.48(1), should primarily take into account whether any injustice would result, whether prejudice would result to the other party, and whether such prejudice could be accounted for by an appropriate costs order or the imposition of other terms to protect that party’s position, and whether the rigid enforcement of the time limit would provide the other party with a forensic advantage.
33 It was submitted on behalf of the Plaintiff that in the light of these discretionary considerations, and in the context of a long and complicated arbitration, the Court should form the view that the Plaintiff should be entitled to recover costs incurred up to date, and to deny the Plaintiff of this entitlement would be to provide the Defendant with a forensic advantage.
34 It was submitted on behalf of the Defendant that the central question for the Court to consider when determining whether to exercise its discretion under s.48(1) or the Act was whether it would be fair and just for the Plaintiff to be granted the extension of time (Salido v Nominal Defendant (1993) 32 NSWLR 524). It was submitted that in considering whether the s.48(1) discretion should be exercised, the Court must consider the reasons for the delay and also the policy behind the legislation under which the time limit was imposed.
35 As to the question of delay it was submitted, for the Plaintiff, that the delay by the Plaintiff to apply for costs was of a minimal nature when one took into account that the arbitration had already been running for over a year and a half, and the application for costs in respect of the interim awards was foreshadowed on 7 July 1998, and made on 15 July 1998, only 24 days outside the time.
36 It was further submitted that the Plaintiff’s solicitors first became aware of Giles J’s decision in Holiday Villages on 26 June 1998, which provided at least a partial explanation for the Plaintiff’s delay in making her costs application. Until the effect of this decision was known, the Plaintiff’s legal advisers were of the impression that the Plaintiff’s entitlement to costs in respect of the interim awards would remain in existence, even after the expiry of the 14 day period. Thus they were not prompted into taking immediate action.
37 It was contended by the Defendant that the Plaintiff had not provided any adequate reasons for her delay in applying for a costs award. It was submitted that the delays - in excess of 7 months in respect of the first interim award and almost four weeks in respect of the second - were substantial, and that good reasons would have to be provided before a Court should indulge the Plaintiff and extend time under s.48(1).
38 It was submitted for the Defendant that the Plaintiff’s solicitors’ claim that they were unaware of the effect of the decision in Holiday Villages was irrelevant. It was submitted that the relevant knowledge was knowledge of the 14 day time limit in s.34(4), not knowledge of the effect of the Holiday Villages case.
39 The Defendant contended that if the Plaintiff had been advised of the time limit when first advised about the award, on 12 June 1998 according to the Plaintiff, then the delay demonstrated a total lack of concern for compliance with the time limit.
40 The defendant further contended that if it were the case that the Plaintiff was not advised of the time limit until after the 14 day period had expired, in which case an affidavit sworn by her legal advisers would have been appropriate, there was still an inexplicable delay between the time when the Plaintiff gave her instructions to make the costs application, on 29 June 1998, and the time when the application was actually foreshadowed, on 7 July 1998, and then made, on 15 July 1998.
41 The Defendant also pointed to the fact that no attempt was made by the Plaintiff to seek the Defendant’s consent to an extension of time.
42 The Plaintiff’s legal advisers had asserted that a letter had been written to the Defendant’s solicitors “very soon after” the second interim award notifying the Defendant of an intended application for costs. The Defendant disputed receiving the letter, and in any case, if the letter was sent at the time alleged, it was obviously not in accordance with the Plaintiff’s instructions, which were not given until 29 June 1998, and was not in compliance with s.34(4), which requires an application for costs to be made to the arbitrator.
43 Counsel for the Defendant further submitted that the Plaintiff’s solicitors could, and should, have sent a letter to the arbitrator as soon as they became aware of time limit imposed by s.34(4), apparently on 26 June 1998. It was submitted that the Plaintiff’s failure to do this and failure to take any action for another two weeks demonstrated a blatant disregard for the time limits imposed by the Act.
44 It was submitted on behalf of the Defendant that the evidence tended to show that the Plaintiff deliberately disregarded the time limit imposed by s.34(4), and therefore the Plaintiff’s application for an extension of time under s.48(1) could not succeed save in exceptional circumstances (Minenco Pty Ltd v Abigroup Contractors (WA) Pty Ltd (White J, 24 February 1992, unreported).
45 Counsel for the Plaintiff submitted that the Defendant had shown no prejudice which would be sufficient to persuade the Court not to exercise its discretion to extend time under s.48(1) in favour of the Plaintiff.
46 The Plaintiff further submitted that the Defendant could not on the one hand argue that it would be appropriate for the arbitrator to deal with costs in one year’s time, at the end of the matter, the probable result being a costs award in favour of the Plaintiff, yet argue on the other hand that an application for costs which was a few weeks out of time would be prejudicial to the Defendant. The result, that is a costs award in favour of the plaintiff, would be the same.
47 It was submitted on behalf of the Defendant that, on the Defendant’s interpretation of s.34(4), the Plaintiff’s claim for an interim costs order would not be barred forever, and therefore there was no real prejudice to the Plaintiff. It was submitted that the Plaintiff was merely trying to accelerate her entitlement to recover costs having failed to make an application in the time provided. If the Plaintiff’s application were refused, her right to recover costs would be deferred, not destroyed.
48 The Defendant submitted that there was no cogent evidence to suggest that prejudice to the Plaintiff could arise on the basis that the Defendant was in a precarious financial position and would not be able to pay the Plaintiff’s costs in the future.
49 Further, it was submitted by the Defendant that costs are an inevitable consequence of arbitration proceedings and the Plaintiff should have anticipated financial hardship (the Plaintiff claimed that she had spent in excess of $600,000 on the proceedings to date). In any case, it was argued by the Defendant that an award of costs at this stage would only be of utility to the Plaintiff if she could enforce it immediately. It was submitted that immediate enforcement of the costs order would be contrary to the usual practice whereby costs do not become payable until the conclusion of the proceedings (SCR Pt 52A r9; Charlie Brown Pty Ltd v Green; Ecroblake Pty Ltd v Charlie Brown Pty Ltd (McClelland CJ in Eq, 3 July 1995, unreported)).
50 The Defendant argued that if the Court were to sanction the approach taken by the Plaintiff, it would be prejudicial to the Defendant in that the Court would in effect be requiring the Defendant to provide security for costs. It was further submitted that a costs award in favour of the Plaintiff now would be prejudicial to the Defendant in that it would reduce the funds available to the Defendant to defend the Plaintiff’s claim on quantum, which was yet to be decided by the arbitrator. It was submitted that it would be in the interests of both parties to finalise the arbitration at the earliest possible opportunity, without adding to the costs of the proceedings by determining quantum of costs on the interim awards.
51 Holiday Villages is authority for the proposition that an arbitrator has the power to make a costs award in relation to an interim award and that nothing in Pt 72 R 12(1) SCR cuts down that power. Holiday Villages largely turns upon its own facts.
52 In Holiday Villages Giles CJ CommD, as he then was, held that an interim award may be concerned with all claims the subject of an arbitration or with some only of those claims. In Holiday Villages the arbitrator had dealt with a series of claims in tranches dealing with each group of issues discretely. The arbitrator, in that case, was unable to deal with questions of offers of compromise in relation to each interim award, since a global offer of compromise could not be disclosed to the arbitrator until the conclusion of the arbitration as a whole as set out in the passage of Holiday Villages cites at paragraph 20 above, a respondent may do badly on an interim award and suffer a costs award but be left with a greater burden than is warranted, when a final order is made, such an earlier costs interim award must stand.
53 I do not see anything in the decision of Holiday Villages which precludes the plaintiff seeking an order for costs at the termination of the proceedings. The decision reaffirms the power of the arbitrator to make an interim order for costs of his own volition or at the request of a party. If the arbitrator is to order costs then Pt 72 R12 SCR must be complied with.
54 I note that in the proceedings before me it is not contended by Mr Scotting for the defendant that the plaintiff is precluded from seeking costs at the termination of the proceedings. That appears to me in any event to be the proper construction of s.34 of the Act. The fact that a party may seek costs at that interim stage does not deprive the party of a right to seek costs merely if the earlier opportunity is not taken. It is noted that in respect of the second award costs were, in any event, deferred.
55 The Court is obliged to examine the question of whether there is an explanation for the delay and must determine that there is a substantial point to be argued and that justice is demonstrated if the applicant is arguing the point. (Doran Construction per Rolfe J in paragraph 29 above) It is clear, that in the nature of a costs order that a very substantial issue arises if the plaintiff is precluded from arguing it. In determining the question of injustice it is necessary to largely determine the question of whether there is any prejudice that arises on either party if the order is made or not made.
56 In Doran Constructions Rolfe J held that an interim award needs to be challenged within the same time frame as a final award since it may in fact be the final award. There is nothing in the Doran Constructions decision to deprive a party of the right to seek costs on an interim award, at the end of the proceedings.
57 There being therefore no prejudice by virtue of the arbitrator’s first interim award where he did deal with and was not asked to order costs, it is necessary to examine any other detriment of the plaintiff.
58 I can see no basis for an interim costs award being made under an Act which is intended to provide a simple mechanism for resolution of disputes other than the need to take out the order and enforce the order as to costs. This may pre-empt a determination on the ultimate costs order depending on whether an overall offer of compromise has been made. There is no basis that I can see of any prejudice in the fact that the interim awards will not have a determination as to costs until the proceedings are completed.
59 I accept the submission of the defendant that the plaintiff has not satisfactorily explained delay for the first award. The delay of some seven months is not properly explained and in that respect the plaintiff fails in her obligation to establish a basis for the grant of an extension of time. (See Salido, supra)
60 I consider that although there is strictly not a full explanation for the delay in respect of the second award, the evidence before me is sufficient to explain that relatively short delay although it would be preferable, in legislation which prescribes a relatively short period for seeking an award for costs, that a full explanation should be given. In any event the provision made as to costs by the arbitrator; that the matter be determined at the termination of the proceedings, does not create any prejudice on the part of the plaintiff.
61 For the reasons enunciated above I do not consider that the plaintiff has established any injustice or in respect of the first or second award nor any satisfactory explanation of delay as a basis for the extension of time for the first interim award as sought and the order number 1 sought in the Summons is therefore declined.
62 As the plaintiff has sought to make further submissions in the event of a failure to obtain an order under paragraph 1 of the Summons I propose to stand the matter over for further argument of that matter before me, at a time convenient to the parties, and I reserve any matters as to costs.
63 The orders that I make are:

1. The application for extension of time is refused.
2. I grant the parties leave to restore the matter for hearing by arrangement with my Associate to determine any other orders sought.
3. Costs are reserved.

oOo

Last Modified: 06/03/1999