Papadopoulos v Meletis
[2020] VSC 505
•14 August 2020
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
PROPERTY LIST
S ECI 2018 02302
| THEODOROS PAPADOPOULOS | Plaintiff |
| v | |
| NICHOLAS MELETIS | First Defendant |
| GRANDVILLE CONSTRUCTION PTY LTD (ACN 153 714 302) | Second Defendant |
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JUDICIAL REGISTRAR: | Matthews JR |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 24 July 2020 |
DATE OF RULING: | 14 August 2020 |
CASE MAY BE CITED AS: | Papadopoulos v Meletis & Anor |
MEDIUM NEUTRAL CITATION: | [2020] VSC 505 |
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PRACTICE AND PROCEDURE – Summary judgment – Whether plaintiff has real prospects of success on his statement of claim – Overarching obligations – Disproportionality to the complexity, importance and amount in dispute – Civil Procedure Act 2010 (Vic), ss 9, 24, 62 and 63 – Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd (2013) 42 VR 27 – Application for summary judgment partially granted.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr D B Clough | Tasiopoulos Lambros & Co |
| For the Defendants | Mr N Paterson | Archer & Sapountzis |
JUDICIAL REGISTRAR:
Introduction
By summons filed 26 May 2020, Nicholas Meletis and Grandville Constructions Pty Ltd, the First and Second Defendants respectively, seek summary judgment on the claims made by Theodoros Papadopoulos, the Plaintiff, against them in this proceeding (‘Application’). The Application is made pursuant to s 62 of the Civil Procedure Act 2010 (‘CPA’).[1]
[1]By orders made by the Court on its own motion, pursuant to r 84.04 of the Supreme Court (General Civil Procedure) Rules 2015 (‘Rules’), the Application has been referred to me for hearing and determination.
The Defendants rely on the following:
(a) affidavit of the First Defendant sworn 25 May 2020 (‘First Meletis Affidavit’);
(b) affidavit of the First Defendant sworn 16 July 2020 (‘Second Meletis Affidavit’); and
(c) written outline of submissions dated 16 July 2020 (‘Defendants’ Outline’).
The Application is opposed by the Plaintiff, who relies on:
(a) affidavit of the Plaintiff sworn 25 June 2020 (‘Papadopoulos Affidavit’); and
(b) written outline of submissions dated 22 July 2020 (‘Plaintiff’s Outline’).
For the reasons which follow, there will be summary judgment for the Defendants on some, but not all, of the claims made by the Plaintiff.
Background
It is not in dispute that the Plaintiff and the First Defendant were both directors of the Second Defendant, a building/construction company, up until October 2016. The Plaintiff and the First Defendant, or entities associated with them, owned the shares in the Second Defendant. Since late 2015, the Plaintiff and the First Defendant were in dispute as to the affairs of the Second Defendant. In 2016, they negotiated terms of settlement to bring their business relationship to an end. This proceeding concerns one aspect of the terms of that settlement, as will be explained below.
The Pleadings
The Plaintiff alleges,[2] and the Defendants admit,[3] that on or about 9 September 2016 the parties entered into a written contract for the settlement of various claims and disputes between them (‘Terms’).[4] The Terms is a handwritten document which incorporates (to the extent not varied or excluded by the Terms) a previous settlement agreement and deed of release and indemnity dated 30 June 2016 and executed on 23 July 2016, which is annexure A to the Terms (‘Annexure A’).[5]
[2]In his statement of claim filed 10 December 2019 (‘SOC’).
[3]In their defence filed 28 January 2020 (‘Defence’).
[4]SOC, [4]; Defence, [4].
[5]SOC, [5]; Defence, [5].
The Plaintiff alleges, and the Defendants admit, that the Terms included clauses that:[6]
[6]SOC, [5]; Defence, [5].
(a) each of the Defendants shall obtain releases in favour of the Plaintiff from all suppliers referred to in annexure B to the Terms (‘Annexure B’) and the Defendants shall provide documentary evidence to that effect, on or before 23 October 2016 (‘Supplier Release Obligation’);[7]
[7]Terms, cl 5(a).
(b) each of the Defendants would discharge all guarantees provided by the Plaintiff in relation to all supplier credit accounts within 60 days of execution of Annexure A (‘Supplier Discharge Obligation’);[8]
[8]Annexure A, cl 8(d).
(c) each of the Defendants must procure releases of all guarantees given by the Plaintiff to any third parties in respect of obligations of the Second Defendant to those third parties including any trade creditors, bank or other lending institution on or before 23 October 2016 (‘Guarantee Release Obligation’);[9]
(d) in the event that any party is unable to obtain a release of guarantees as required under the Terms on or before 23 October 2016, the defaulting party charged in favour of the guarantor all its right, title and interest in all real estate in the name of the defaulting party, to the extent of any liability arising under the guarantee (‘Charging Clause’);[10] and
(e) each party must exercise best endeavours to promptly do everything which is necessary to give effect to the Terms.[11]
[9]Terms, cl 7.
[10]Terms, cl 16.
[11]Annexure A, cl 2.2.
The Plaintiff alleges that the Defendants breached the terms by failing to:[12]
[12]SOC, [6].
(a) obtain releases in favour of the Plaintiff from the suppliers referred to in Annexure B, further and alternatively to provide documentary evidence to that effect
(b) procure discharges of guarantees provided by the Plaintiff in relation to all supplier credit accounts, within 60 days of execution of Annexure A or at all; and/or
(c) procure discharges of all guarantees given by the Plaintiff to any third parties in respect of obligations of the Second Defendant to those third parties, on or before 23 October 2016.
The Defendants deny the allegations referred to in the preceding paragraph and say that they are not aware of any claims or potential claims against the Plaintiff by suppliers to the Second Defendant or extant guarantees given by the Plaintiff to such suppliers. The Defendants say further that in late 2016 (with dates both before and after 23 October 2016), they procured certain communications from named suppliers.[13] These vary in content, from confirming that there is nothing outstanding on an account or that the account is closed, to a release of the Plaintiff from a guarantee given to that supplier.
[13]Defence, [6].
The Plaintiff alleges that the Guarantee Release Obligation extends to a general indemnity in favour of Victorian Managed Insurance Authority (‘VMIA’) under a deed of indemnity for domestic building insurance dated 12 February 2014 (‘VMIA Deed’).[14] The Defendants admit that the Plaintiff gave an indemnity in favour of VMIA in the VMIA Deed but deny that the VMIA Deed is a guarantee within the meaning of the Terms.[15]
[14]SOC, [7]; Exhibit NM-7 to the First Meletis Affidavit.
[15]Defence, [7].
The Plaintiff alleges, and the Defendants admit, that the First Defendant was and is the owner of a property in Sovereign Way, Hillside (‘Property’).[16]
[16]SOC, [8]; Defence, [8].
The Plaintiff alleges that by reason of the Charging Clause, the Plaintiff has a charge over the Property to the extent of any liability arising under the guarantees referred to in the Guarantee Release Obligation (‘Charge’).[17] The Defendants admit that the Plaintiff would be entitled to a charge over the Property to the extent of any guarantee that was required by the Terms to be discharged but which was not so discharged, and otherwise deny this allegation.[18]
[17]SOC, [9].
[18]Defence, [9].
The Plaintiff alleges that on or about 6 February 2018, a claim was brought against the Second Defendant in the Victorian Civil and Administrative Tribunal (‘VCAT’) in proceedings no. BP1094/2018 (‘VCAT Proceeding’). One of the claims made in the VCAT Proceeding is a failure to carry out building works in a proper and workmanlike manner in accordance with a major domestic building contract as defined by s 3 of the Domestic Building Contracts Act 1995 (Vic) (‘DBC Act’). The Defendants admit these allegations.[19]
[19]SOC, [10-[11]; Defence, [10]-[11].
The Plaintiff alleges that the Charge extends to the amount of any liability incurred by the Plaintiff to VMIA under the VMIA Deed as a direct or indirect result of the outcome of the VCAT Proceedings or in relation to its subject matter.[20] The Defendants deny this allegation.[21]
[20]SOC, [12].
[21]Defence, [12].
Relevantly, the Plaintiff seeks the following relief:[22]
[22]There are other allegations made in the SOC as to an undertaking given by the Second Defendant to the Supreme Court of Victoria in a separate proceeding and some relief is sought in respect of that undertaking, however no emphasis was placed on this by the parties. Where relevant, I have referred to this undertaking below.
(a) specific performance – the prayer for relief does not say of what, but presumably specific performance of the Terms, in particular, the Supplier Release Obligation, the Supplier Discharge Obligation and the Guarantee Release Obligation;[23]
[23]SOC, paragraph A of the prayer for relief.
(b) declarations that:[24]
[24]SOC, paragraph C of the prayer for relief.
(i) the Plaintiff holds a charge over the Property to the extent of any liability arising under the guarantees referred to in the Guarantee Release Obligation; and
(ii) the Plaintiff holds a charge over the Property to the extent of any liability incurred by the Plaintiff to VMIA under the VMIA Deed as a direct or indirect result of the outcome of the VCAT Proceedings or in relation to its subject matter.
Applicable principles
I recently summarised the principles applicable to summary judgment, in the context of a defendant applying for summary judgment on the plaintiff’s claims (which is effectively an application for summary dismissal of the proceeding), in Vorontsov & Anor v Le Roy Fong & Ors (No 2).[25] There is no need for me to set that, other than to say that I adopt the summary set out therein and apply it to this Application.
[25][2020] VSC 458, [30]-[41].
There are other provisions in the CPA which are convenient at this point to set out.
Section 7(1) of the CPA states that its overarching purpose is to ‘facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute’. Section 7(2) states as follows:
(2)Without limiting how the overarching purpose is achieved, it may be achieved by—
(a) the determination of the proceeding by the court;
(b) agreement between the parties;
(c) any appropriate dispute resolution process—
(i) agreed to by the parties; or
(ii) ordered by the court.
Section 8 of the CPA states that a court ‘must seek to give effect to the overarching purpose in the exercise of any of its powers, or in the interpretation of those powers’.
Section 9 of the CPA states as follows:
(1) In making any order or giving any direction in a civil proceeding, a court shall further the overarching purpose by having regard to the following objects—
(a) the just determination of the civil proceeding;
(b) the public interest in the early settlement of disputes by agreement between parties;
(c) the efficient conduct of the business of the court;
(d) the efficient use of judicial and administrative resources;
(e) minimising any delay between the commencement of a civil proceeding and its listing for trial beyond that reasonably required for any interlocutory steps that are necessary for—
(i) the fair and just determination of the real issues in dispute; and
(ii) the preparation of the case for trial;
(f) the timely determination of the civil proceeding;
(g) dealing with a civil proceeding in a manner proportionate to—
(i) the complexity or importance of the issues in dispute; and
(ii) the amount in dispute.
(2) For the purposes of subsection (1), the court may have regard to the following matters—
(a) the extent to which the parties have complied with any mandatory or voluntary pre-litigation processes;
(b) the extent to which the parties have used reasonable endeavours to resolve the dispute by agreement or to limit the issues in dispute;
(c) the degree of promptness with which the parties have conducted the proceeding, including the degree to which each party has been timely in undertaking interlocutory steps in relation to the proceeding;
(d) the degree to which any lack of promptness by a party in undertaking the proceeding has arisen from circumstances beyond the control of that party;
(e) the degree to which each person to whom the overarching obligations apply has complied with the overarching obligations in relation to the proceeding;
(f) any prejudice that may be suffered by a party as a consequence of any order proposed to be made or direction proposed to be given by the court;
(g) the public importance of the issues in dispute and the desirability of a judicial determination of those issues;
(h) the extent to which the parties have had the benefit of legal advice and representation.
(3) This section does not—
(a) limit any other power of a court to make orders or give directions; or
(b) preclude the court from considering any other matters when making any order or giving any direction.
The CPA also sets out a number of overarching obligations that apply. These include the overarching obligation to ensure that costs are reasonable and proportionate to the complexity or importance of the issues in dispute and the amount in dispute.[26]
[26]CPA, s 24.
The Court has various powers and sanctions available to it where the overarching obligations have been breached.[27]
[27]CPA, ss 28-29.
Summary of submissions
The Defendants seek summary judgment against the Plaintiff on the basis that:
(a) the VMIA Deed is not a guarantee within the meaning of the Terms from which the Defendants were required to secure a release of the Plaintiff;
(b) other than the VMIA Deed, the Plaintiff has not identified any obligation of the Second Defendant in respect of which he is liable as guarantor or on any other basis; and
(c) there is no justiciable issue for determination, as the Court ought not be concerned with protecting the Plaintiff against theoretical possibilities.
The Defendants submit that the equitable remedy of specific performance should only be given where damages is an inadequate remedy.[28] Further, only where the performance sought is possible,[29] and where a plaintiff has not waited an inordinate time to commence and prosecute proceedings.[30]
[28]Hewett v Court (1983) 149 CLR 639, 665.
[29]Ferguson v Wilson (1866) LR 2 Ch App 77, 91.
[30]Lamshed v Lamshed (1963) 109 CLR 440, 453; Holland v Roperti [2009] VSC 378, [88], [90].
The Defendants also submit that the equitable remedy of declaration is discretionary, but is unlikely to be granted in the absence of a real and substantial controversy. Dal Pont describes the position as follows: [31]
Lacking an immediate and real controversy, the court is unlikely to grant a declaration. “[T]he question in each case”, it is said, “is whether the facts alleged, under all the circumstances, show that there is a substantial controversy, between parties having adverse legal interests, of a sufficient immediacy and reality to warrant the issuance of a declaratory judgment”. Because the judicial process aims to determine the rights of litigants finally, courts refuse to give answers to purely academic, theoretical or hypothetical questions, or to give advisory opinions. The mere possibility of future interference with a plaintiff’s rights is not an appropriate basis to justify a declaratory decree because “the declaration speaks from the time that it is made”.
[31]G E Dal Pont, “Equity and Trusts in Australia 7ed”, Lawbook Co, 2019 at [37.30], footnotes omitted.
The Plaintiff submits that the Application is misconceived, as:
(a) the First Meletis Affidavit demonstrates that each alleged release and/or discharge in relation to the suppliers listed in the Plaintiff’s further and better particulars (‘FBPs’) was obtained by the Defendants after the commencement of this proceeding. The FBPs list those suppliers from whom the Plaintiff alleges the Defendants were obliged to obtain releases in his favour;
(b) even if the releases and/or discharges allegedly obtained by the Defendants satisfy the Supplier Release Obligation and/or the Supplier Discharge Obligation, they represent capitulations and admissions of the Defendants to the Plaintiff’s claims in the SOC in that respect, and performance of those contractual obligations, which is what is sought by the Plaintiff in the proceeding; and
(c) if so, then there should be judgment for the Plaintiff on those claims, being the claims in respect of the Supplier Release Obligation and the Supplier Discharge Obligation, with costs.
As the Application was argued, it became clear that there were two main areas for consideration: the allegations in respect of suppliers (ie the Supplier Release Obligation and the Supplier Discharge Obligation, which I will refer to collectively as the ‘Supplier Obligations’); and the Guarantee Release Obligation in respect of the VMIA Deed. While it is true that there may well be some overlap between the Supplier Obligations and the Guarantee Release Obligation so far as trade creditors/suppliers are concerned, there was a clear distinction in argument, acknowledged by all parties, between suppliers/trade creditors and VMIA.
Therefore, it is convenient to divide the discussion in these reasons to two main sections: the Supplier Obligations and the VMIA Deed. For convenience and to avoid repetition, I have set out the submissions of the parties and the evidence relied upon by them, followed by my consideration of them, in turn.
Supplier Obligations
Defendants’ submissions/evidence
The Defendants’ submissions, and evidence relied upon, are set out in the below paragraphs.
There is no dispute that there were no formal releases or discharges from the parties listed in Annexure B to the Terms, whether of any obligations that the Plaintiff had as guarantor or otherwise, in the sense that deeds of release were executed.
However, for the reasons below, there has been substantial performance of that obligation, by the informal efforts of the First Defendant and by discharge of the Second Defendant’s debts.
The First Defendant has deposed that, in respect of each of the suppliers and creditors of the Second Defendant:
(a) in late 2016 he sought and obtained various confirmations from suppliers and releases of entities that he then understood the Plaintiff had exposure to;[32]
[32]First Meletis Affidavit, [7].
(b) he settled all accounts of suppliers which had not been settled prior to the Terms;[33]
[33]First Meletis Affidavit, [9].
(c) he closed accounts in the name of the Second Defendant with such suppliers and told them any further business would be conducted with them by Grandville Homes Pty Ltd;[34]
[34]First Meletis Affidavit, [8].
(d) he did not receive the financial records of the Second Defendant from the Plaintiff until August 2017 and did not have copies of the guarantees referred to in the FBPs until February 2020;[35]
[35]First Meletis Affidavit, [12], [15], [20].
(e) there is not, to his knowledge, any liability of the Second Defendant to suppliers of the Second Defendant that has not been paid in full;[36]
[36]First Meletis Affidavit, [21(a)].
(f) there is not, to his knowledge, any guarantee given by the Plaintiff for obligations of the Second Defendant:
(iii) where the Second Defendant has, after 2017, owed any money to any person; or
(iv) where the Second Defendant still owes or might owe money to any person; or
(v) where the Second Defendant still trades with the supplier which had asked for the guarantee, or
(vi) which the supplier has not acknowledged to the First Defendant that the relevant account was closed, either verbally or by email;[37] and
(g) since 20 October 2016 (when the First Defendant became the sole director of the Second Defendant), the Second Defendant has not traded with any of the entities referred to in the FBPs.[38]
[37]First Meletis Affidavit, [21(b)].
[38]First Meletis Affidavit, [24].
The First Defendant has deposed extensively in respect of each of the parties listed in the FBPs, as to his efforts to obtain confirmation from each of them that no liability exists.
The Plaintiff has provided no particulars of any current indebtedness of the Second Defendant to any creditor or third party. Nothing in his affidavit, in response to that of the First Defendant as outlined above, suggests that he has made any effort to contact any of the persons or entities listed in the FBPs to ascertain whether there is any outstanding obligation of the Second Defendant to them.
The only alleged creditors of the Second Defendant to which the Plaintiff refers in his affidavit are UCD Pty Ltd and Free Transplanting Victoria (sic).[39] However, in respect of them:
[39]Papadopoulos Affidavit, [27(b)].
(a) he asserts no more than that they carried out work for and invoiced the Second Defendant, and does not respond to the lengthy evidence given by the First Defendant as to why he believes that there is no indebtedness of the Second Defendant to them;[40]
(b) they are not entities to which he has asserted any personal liability or risk of such; and
(c) they are not entities to which he has alleged that he gave guarantees of payment by the Second Defendant.[41]
[40]First Meletis Affidavit, [72]-[81]; [108]-[111].
[41]No such guarantees are set out in the FBPs or have been provided in discovery.
The Plaintiff has given no evidence of any claim being made against him by any person in respect of the obligations of the Second Defendant, or that there has been any threat to bring such claim.
The best the Plaintiff can do is assert that he believes it is possible that if the Second Defendant were to obtain further goods and services from them, he might remain exposed.[42] However, there is no evidence of any basis for any such apprehension.
[42]Papadopoulos Affidavit, [28].
There is no proper basis for the Court to give the Plaintiff the equitable relief that he seeks:
(a) being specific performance, as there is no basis put before the Court on which it could conclude that damages would be an inadequate remedy; or
(b) being declarations, as they are sought in respect of a theoretical possibility, wholly divorced from the effectively uncontested evidence of the lack of liabilities of the Second Defendant or of any risk of the Plaintiff being liable for such.
Finally, even if there were a theoretical possibility of exposure of the Plaintiff under guarantees of the Second Defendant, he raised those guarantees as part of his defence to counterclaim in a proceeding he had brought in 2017 in the Magistrates’ Court, being proceeding no. H10803516 (‘Magistrates’ Court Proceeding’),[43] and on 6 December 2017 agreed to “mutually abandon any rights, entitlements or liabilities arising from” the Magistrates Court Proceeding.[44]
[43]Second Meletis Affidavit, Exhibit NM-65, see paragraph 7 of the defence to counterclaim of that proceeding.
[44]Second Meletis Affidavit, Exhibit NM-66.
Plaintiff’s submissions/evidence
The Plaintiff’s submissions, and evidence relied upon, are set out in the below paragraphs. Essentially, the Plaintiff submits that the alleged releases and/or discharges obtained by the Defendants are insufficient, and that substantial performance is not good enough.
The releases and/or discharges allegedly obtained by the Defendants do not satisfy the Terms.
The commercial context and purpose of the Terms was that the Plaintiff and First Defendant wished to “fully and finally settle all matters arising out of and in connection with their business relationship as Shareholders and Directors of [the Second Defendant]”.[45]
[45]Item I in Annexure A.
The alleged releases and/or discharges relied on by the Defendants do not achieve that commercial purpose nor do they satisfy the plain words of cl 5(a) or cl 8(d) of Annexure A.
Clause 5(a) of the Terms requires the Defendants to obtain “releases in favour of [the Plaintiff]”. The meaning of “releases”, objectively construed, is to bind oneself to not to sue. On the evidence in the First Meletis Affidavit, none of the suppliers referred to in the FBPs has bound itself, in writing or orally, not to sue the Plaintiff.
Clause 8(d) of Annexure A requires the Defendants to “discharge all guarantees provided by [the Plaintiff] in relation to all supplier credit accounts”. The meaning of “discharge”, objectively construed, is to bind oneself not to sue for breach of a legal obligation. Not one of the suppliers referred to in the First Meletis Affidavit at [27]‑[126] has promised not to sue the Plaintiff for breach of guarantee.
Instead, the Defendants rely on non-contractual statements by suppliers to the effect that the Second Defendant currently no longer trades with it, no monies are currently owed by the Second Defendant; and/or the trading account is currently closed (whatever that means).
The Defendants have merely engaged in “efforts to obtain confirmation from each [of the suppliers] that no liability exists”.[46]
[46]Defendants’ Outline, [23].
The Defendants follow with the argument that the Plaintiff has not demonstrated any current indebtedness or outstanding obligation.[47]
[47]Defendant’s Outline, [24].
The fundamental problem with those arguments is that the Defendants’ position fails to achieve either: (a) compliance with the plain words of the Terms; or (b) the commercial purpose of “fully and finally settling all matters arising out of and in connection with [the Plaintiff’s and First Defendant’s] business relationship”.
As for procuring discharges of the guarantees, the Defendants argue there is no need for them to comply because the Second Defendant paid the suppliers’ accounts and will not continue to trade with the suppliers.
There is nothing in the Defendants’ evidence that shows the Second Defendant cannot recommence trading with any of the suppliers under an extant guarantee to which the Plaintiff is a party.
The First Defendant says he will not recommence trading with the suppliers:
(a) he told the suppliers to close the accounts, that the Second Defendant would not do further business with them, and that they should “remove the Plaintiff from the accounts and guarantees and that [the First Defendant] would be responsible for those accounts”;[48] and
(b) he says he has “no intention of causing or permitting the Second Defendant to trade with any of the persons or entities listed in the [FBPs].”[49]
[48]First Meletis Affidavit, [8].
[49]Second Meletis Affidavit, [3].
The First Defendant’s mere statements of intention not to cause the Second Defendant to trade with the abovementioned suppliers do not even come close to the procurement of discharges of guarantees from those suppliers.
This is not a minor matter. On 12 May 2017, the Second Defendant undertook to the Court to “use its best endeavours to obtain a release of all guarantees”.[50] It has not done so.
[50]Item 2 in Other Matters in the Orders of Digby J made on 12 May 2017, Exhibit NM-2 to the First Meletis Affidavit.
As the Defendants would have it, the Plaintiff should concede his contractual rights under the Terms and the Second Defendant’s undertaking to the Court, and proceed to live in hope that the First Defendant will remain true to his non-contractual statements that the Second Defendant will not expose the Plaintiff to further liability.
It is a difficult position for the Defendants to hold, made irretrievable by the lack of any assurance that the First Defendant would not transfer ownership or control of the Second Defendant.
The Defendants acknowledge their failure to comply with the Terms by their argument that they ought to be excused by reason of substantial performance.[51]
[51]Defendants’ Outline, [21].
There is no rule that in all commercial contracts the question is whether there has been substantial compliance with the contract.[52]
[52]Arcos Ltd v EA Ronaasen & Son [1933] AC 470, 479; see Buildev Development v Pic Sales [2003] NSWSC 1245, [11]-[12] (‘Buildev’).
For the Defendants’ argument to succeed, the Defendants must satisfy the Court that a requirement of merely substantial performance may be implied from the nature of the parties’ obligations.[53] No such allegation is pleaded in the Defence. It would fail in any event and, on any view, it is a matter for trial.
[53]See for example Luna Park (NSW) Ltd v Tramways Advertising Pty Ltd (1938) 61 CLR 286, 304; and Buildev, [11].
Consideration
It appears to be common ground that the Defendants did not comply with the Supplier Obligations by the time stipulated in the Terms, being 23 October 2016. The Court is not being asked to award damages in respect of a breach of the Supplier Obligations, rather, it is being asked to order specific performance in respect of those obligations. That necessitates assessing the steps taken by the Defendants, both before and after the time stipulated, including steps taken prior to and since the proceeding was issued, to see whether the Defendants remain in breach of the Supplier Obligations such that there remains a justiciable controversy. In the absence of a justiciable controversy, the Court is unlikely to award specific performance or make the declarations sought.
In the case of Manderson M & F Consulting v Incitec Pivot Limited (2011) 35 VR 98, the Court of Appeal, in contrasting an application for summary judgment with an application to strike out a pleading or to allow an amendment of a pleading, acknowledged that ‘the inquiry as to whether there are no real prospects of success does involve considerations which extend beyond an analysis of the sufficiency of the pleadings’. In this case, one has to go beyond the pleadings in order to ascertain whether there remains a justiciable controversy.
In respect of the steps taken by the Defendants regarding the Supplier Obligations, I accept the evidence and submissions of the Defendants. They have obtained releases or discharges of some of guarantees and they have confirmed, from the other suppliers, that there is no extant liability for which the Plaintiff could be liable. The evidence is that the Second Defendant has not traded with those suppliers for some years or closed its accounts with them some time ago. In saying that, I am leaving to one side the question of any liability to VMIA, which is being dealt with in a separate section below.
While substantial performance may not be sufficient to obviate specific performance, as the Plaintiff contends, it is relevant to the consideration of whether there remains a justiciable controversy in respect of the Supplier Obligations.
The ongoing risk identified in the Plaintiff’s submissions is now, due to the steps taken since the Terms were entered into, and particularly those outlined in the First Meletis Affidavit, more hypothetical than real.
Even if that hypothetical risk amounted to a justiciable controversy, I am not convinced that the Plaintiff has a real prospect of success on that claim.
The import of the Defendants’ submissions in respect of the Magistrates’ Court Proceeding was not entirely clear. All that was said about this issue was as I have set out in paragraph 39 above. One reading of this submission, and I think it is the intended reading, is that the terms of settlement between the parties in the Magistrates’ Court Proceeding have the effect that the claims made by the Plaintiff in this proceeding have been released. From a review of the pleadings in the Magistrates’ Court Proceeding and the terms of settlement therein,[54] the proposition seemingly advanced by the Defendants may be correct. However, it seems to me that there may be a counter-argument to this, the resolution of which would fall to a construction of the relevant terms. There was no oral argument on this issue at all, and there is no mention of it in the Plaintiff’s Outline. In all of the circumstances, I am not prepared to conclude, on this basis alone, that the terms of settlement of the Magistrates’ Court Proceeding have the effect that the Plaintiff’s claims in this proceeding have no real prospect of success. Nonetheless, coupled with the above, it tends to the overall view that the claims have no real prospect of success.
[54]Exhibits NM-65 and NM-66 to the Second Meletis Affidavit.
In any event, even if there was a real prospect of success on the claims in respect of the Supplier Obligations, I do not consider the continued pursuit of them to be consistent with the overarching purpose and the overarching obligations as set out in the CPA.
Continued litigation on the question would take up valuable Court time and resources, along with those of the parties, with little tangible result in the circumstances. The resources consumed in that process are disproportionate to the claims made, the importance of the issues in dispute and the amount in dispute. First, no amount is in dispute. Second, the issues in dispute are not important as the evidence shows that there is no extant liability of the Plaintiff from which he requires release or discharge. In my view, to continue with these claims is to allow litigation to continue that is disproportionate to the complexity or importance of the issues in dispute and the amount in dispute[55] and is not an efficient use of judicial resources.[56] A just determination of this aspect of the proceeding[57] can be achieved without it continuing to trial. In coming to this view, I have had regard to the matters set out in s 9(2) of the CPA, particularly those in sub-paragraphs (b), (f), (g) and (h). In particular, I do not consider that the Plaintiff will suffer any prejudice as a result of any order to prevent the continued litigation of the claims in respect of the Supplier Obligations.
[55]CPA, s 9(1)(g).
[56]CPA, s 9(1)(d).
[57]CPA, s 9(1)(a).
It is difficult to see how the continued maintenance of the claims in respect of the Supplier Obligations is reasonable and proportionate to the complexity or the importance of these issues or the amount in dispute.
I am fortified in this view by the Plaintiff’s own submission, which was that in effect the Defendants have, by the steps they have taken as outlined in the First Meletis Affidavit, capitulated to the Plaintiff’s claims.[58] In oral submissions, Counsel for the Plaintiff submitted that if the Court took the view that enough had been done by the Defendants, such that specific performance was otiose or redundant, then that was because the Plaintiff had commenced the proceeding. It was said that the Plaintiff did not concede that the Defendants had done enough, but the Court’s point about proportionality (which I had raised in the course of argument) was taken.[59]
[58]See paragraph 26 above.
[59]Transcript, 15.15-18.9.
That is not to say that I agree with the proposition in the Plaintiff’s Outline that judgment should be entered for him on those claims, with costs. To enter judgment for the Plaintiff is effectively to make orders for specific performance and to make the declarations sought, in respect of the claims concerning the Supplier Obligations. That is not this application – the Plaintiff has not sought summary judgment. Further, to do so would require the Court to undertake the very task which I have said should not be undertaken, as it has no utility, as there does not remain a justiciable controversy. Rather, given that I have concluded that the claims in respect of the Supplier Obligations have no real prospect of success, summary judgment should be entered for the Defendants on those claims, in that those claims should be dismissed. In oral submissions, Counsel for the Plaintiff acknowledged that if the Court took that view, this would be the most appropriate approach given the form of relief sought by the Plaintiff.[60] I note that for the reasons set out above, if I had not so concluded, then I would have ordered that the paragraphs of the SOC referable to the claims in respect of the Supplier Obligations be struck out pursuant to the CPA.
[60]Transcript, 16.28-31, 17.22-25.
VMIA Deed
Defendants’ submissions/evidence
The Defendants’ submissions, and evidence relied upon, are set out in the below paragraphs.
Given that the Terms prescribe obligations of the Defendants to procure releases of certain obligations of the Plaintiff, and give broad releases by the Defendants to the Plaintiff, those obligations ought to be construed strictly in accordance with their terms.
Guarantees and indemnities are different creatures at law. Of course, they are often seen in the same document, but they serve different purposes. The former is a promise to ensure the performance of another party or occurrence; the latter a promise to protect or compensate another party against loss.
Guarantee is defined by the Macquarie Dictionary, as a noun, relevantly to mean:
1.a warrant, pledge, or promise accepting responsibility for the discharging of another's liabilities, as the payment of a debt.
2.a promise or assurance, especially one given in writing by a manufacturer, that something is of a specified quality, and generally including an undertaking to make good any defects under certain conditions.
…
5. that which is taken or presented as security.
… [61]
[61]Macquarie Dictionary Publishers, 2020.
Indemnity is defined by the Macquarie Dictionary, relevantly, to mean:
1. protection or security, as by insurance, against damage or loss.
2. compensation for damage or loss sustained.
3. something paid by way of such compensation.
4.legal protection, as by insurance, from liabilities or penalties incurred by one's actions.
… [62]
[62]Ibid.
The VMIA Deed was a deed entered into between the parties and VMIA in 2014 and, on its terms, relevantly:
(a) requires the plaintiff to “unconditionally and irrevocably indemnify [VMIA] against any Liability.”
(b) defines Liability as:
“the aggregate of all payments made and liabilities incurred by [VMIA] under or in connection with the Insurances, including:
any payments we make, including the payment of anyone else's costs (including legal costs) and expenses:
• by way of Indemnity in respect of any claim, or
• to settle a dispute;
any costs and expenses (including legal costs on a full Indemnity basis) paid or incurred by us in connection with any claim or dispute under or in connection with the Insurances or the enforcement of our rights under this deed; and
any fee or premium that the Builder Is required to pay us under or in connection with the Insurances which is not paid when due, and includes interest on such amounts.”
(c) defines the Insurances as:
“each and every Domestic Building Insurance policy as required by section 135 of the Building Act 1993 (Vic) Issued by us (or Issued by QBE Insurance (Australia) Limited ACN 003 191 035 as agent for us or pursuant to an agreement with us) at any time, including before this deed was executed, at the Builder’s request“ [63]
[63]Exhibit NM-7 to the First Meletis Affidavit, clause 11.1.
Nowhere is the term “guarantee” used in the VMIA Deed. That deed does not require the plaintiff to ensure the performance of any act or obligation of the second defendant. Its focus is to provide the VMIA with a right of recovery against the plaintiff and the first defendant, if the VMIA suffers any loss by reason of insurance given by the VMIA being called upon.
Even if the Court was to form a view that the VMIA Deed is or is arguably a guarantee in the relevant sense, such a guarantee would not fall within the scope of the Guarantee Release Obligation:
(a) First, because that term requires that the guarantees to be released are “in respect of obligations of [the second defendant] to those third parties”. Here, there is no relevant obligation of the Second Defendant to the VMIA - the VMIA merely insures the party employing the builder in circumstances where that builder becomes insolvent, deregistered or disappears.
(b) Second, the term gives examples of the kinds of third parties from which releases were required. None of those examples in the term encompass or are analogous to an insurer, which the VMIA is. Accordingly the term should be construed ejusdem generis, so as to exclude third parties not of the nature of those listed.
The Plaintiff’s belief that the VMIA Deed was intended to be covered by the Guarantee Release Obligation is irrelevant.[64] What is relevant is the ordinary meaning of the words used in the Terms, which are clear and without ambiguity.
[64]Papadopoulos Affidavit, [12], [25].
Even were the VMIA Deed arguably a guarantee from which the Defendants were required to procure a release of the Plaintiff:
(a) it was irrevocable on its terms and thereby not within the Defendants’ power to procure a release of Mr Papadopoulos; and
(b) there is no evidence of any present liability or likely liability of the Plaintiff under it.
Any potential liability of the Plaintiff under the VMIA Deed is just that: potential. In that regard:
(a) the only claim against the Second Defendant that the Plaintiff can point to as potentially giving rise to a claim against him by the VMIA is the subject of the VCAT Proceeding, which is brought by the Plaintiff’s sister, who is represented by the Plaintiff’s lawyers;[65]
(b) there is no evidence of the likelihood of the VCAT Proceeding resulting in a net liability of the Second Defendant;[66] and
(c) the VMIA Deed can only be called upon in the event that the Second Defendant is de-registered or becomes insolvent[67] – and there is no assertion or evidence of that being the case or even being likely.
[65]Papadopoulos Affidavit, [30]; Second Meletis Affidavit, [4].
[66]Second Meletis Affidavit, [4].
[67]Exhibit TP3 to the Papadopoulos Affidavit and clause 23 of Exhibit NM-61 to the Second Meletis Affidavit.
Contrary to these submissions, even if the Court is of the view that there is a question to be tried as to whether the VMIA Deed is a guarantee, and as to whether the defendants are required to procure its discharge, there is no proper basis for the Court to order:
a. specific performance, as the obligation would be incapable of performance, and there is no basis put before the Court on which it could conclude that damages would be an inadequate remedy; or
b. declarations as sought in the statement of claim, on the basis that those declarations are sought in respect of a theoretical possibility, wholly divorced from the, effectively uncontested, evidence of the lack of liabilities of the Second Defendant or of any risk of the Plaintiff being liable for such.
Plaintiff’s submissions/evidence
The Plaintiff’s submissions, and evidence relied upon, are set out in the below paragraphs.
The VMIA is a “third party” within the meaning of the Guarantee Release Obligation. It is significant that the parties inserted the term “must” prior to “procure releases”. Plainly the parties intended strict compliance with the Guarantee Release Obligation.
It is also significant that the parties inserted the term “third parties” and crossed-out the term “trade suppliers” in the Guarantee Release Obligation. Plainly the parties intended that it broadly cover all guarantees given by the Plaintiff, and not merely those given to trade suppliers.
The meaning of “guarantees” in the Guarantee Release Obligation should be construed:
(a) in the context of the abovementioned commercial purpose of the Terms, to “fully and finally settle all matters arising out of and in connection with [the Plaintiff’s and First Defendant’s] business relationship”; and
(b) as being informed by the words “in respect of obligations of [the Second Defendant] to those third parties”.
Under the VMIA Deed, the Plaintiff agreed to indemnify VMIA against any “Liability”, which is defined essentially as the aggregate of payments incurred by VMIA under Domestic Building Insurance policies issued to cover the Second Defendant’s obligations to its customers.
The Defendants argue that the VMIA Deed is an indemnity. From the Plaintiff’s perspective, however, the effect is the same. Under the VMIA Deed, the Plaintiff is liable, albeit indirectly, for the Second Defendant’s obligations to third parties.
Put another way, if the Plaintiff had given a guarantee directly to a customer of the Second Defendant, the result essentially would be the same as the Plaintiff indemnifying the VMIA for payments under its insurance of the Second Defendant’s obligations to its customers. The only essential difference is the intermediation of the VMIA.
Objectively construing the Guarantee Release Obligation in all its terms and in its commercial context, the parties intended that the Defendants would discharge the Plaintiff from liability for all the Second Defendant’s obligations to “fully and finally settle all matters”.
It is notable that the Defendants did not take the position that the VMIA Deed was not a “guarantee” within the meaning of the Guarantee Release Obligation until it filed its Defence. By contrast, on 18 January 2019 the Defendants wrote to VMIA, stating (to paraphrase) that the First Defendant took on “all liabilities with regard to any claims” resulting from the Second Defendant’s contractual obligations.
The Plaintiff plainly has real prospects of success at trial on its construction of the Guarantee Release Obligation.
The Defendants then argue that even if the VMIA Deed falls within the Guarantee Release Obligation, it is “irrevocable on its terms and thereby not within the Defendants’ power to procure a release”.[68] This argument is not pleaded in the Defence.
[68]Defendants’ Outline, [17(a)].
A contract must be construed in accordance with ordinary rules of contract interpretation. There is no principle of law, nor even an interpretative presumption, that enables a contractual term to be avoided simply because a Court considers that complying with it would serve no useful purpose.[69]
[69]Astor Management AG v Atalaya Mining plc [2018] EWCA Civ 2407, [34] (‘Astor’).
Further, even where a subsequent event was not contemplated by the parties, it is only legitimate to construe the agreement as ceasing to apply if it is clear that is what reasonable parties would have intended.[70] In the present case, however, the impossibility of obtaining discharge was not unanticipated, but rather was expressly provided for, in the Charging Clause. In other words, the Guarantee Release Obligation remains effective, in combination with the Charging Clause, notwithstanding impossibility of discharge of the VMIA Deed.
[70]Astor, [40].
The VMIA Deed expires in November 2021.[71] Therefore, the Charging Clause operates to entitle the Plaintiff to a charge over the First Defendant’s real estate to the extent of any liability under the VMIA Deed until that date.
[71]Papadopoulos Affidavit, Exhibit TP3.
The Plaintiff plainly has real prospects of success in obtaining the declarations it seeks in relation to the charge.
Consideration
One of the main issues in dispute in this proceeding, if not the main issue in the circumstances, is whether the Guarantee Release Obligation extends to VMIA and the Plaintiff’s liability to VMIA under the VMIA Deed. In oral submissions, Counsel for the Plaintiff acknowledged that the essence of the case is supporting the Plaintiff’s caveat over the Property by substantiating the interest claimed in the caveat. It was said that when it comes down to it, the issue is the Plaintiff’s exposure to VMIA.[72] In saying that, Counsel did not concede the Application in respect of the balance of the Plaintiff’s claims.
[72]Transcript, 12.11-30. See also Transcript 25.23-25, where the Plaintiff’s exposure to VMIA was described as “a very real and practical commercial exposure”.
This requires consideration of whether the VMIA Deed is an indemnity only, or whether it is a guarantee; if it is a guarantee, whether it is a guarantee of an obligation of the Second Defendant; and whether there is merely a hypothetical risk to the Plaintiff of liability under the VMIA Deed.
I have formed the view that it is unlikely that the VMIA Deed is a guarantee and that even if it is, it does not secure a liability of the Second Defendant. The language in the VMIA Deed is more consistent with that used when referring to an indemnity rather than a guarantee. In most cases, an indemnity is not the same as a guarantee. In this instance, the indemnity given by the Plaintiff only arises if the Second Defendant is incapable of performance, as it only arises if the builder (ie the Second Defendant) is insolvent or has been deregistered with ASIC. Further, the obligation to VMIA is that of the Plaintiff, and not of the Second Defendant. It is the inability of the Second Defendant to satisfy an obligation to the beneficiary of the insurance policy which creates an obligation for VMIA to compensate that beneficiary and which gives rise to the indemnity given by the Plaintiff to VMIA via the VMIA Deed.
However, I cannot conclude and have not concluded that the Plaintiff’s claims in this regard have no real prospect of success. Just because one view of the situation is more likely than the other does not meet the test for awarding summary judgment, as that test is set out in Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd.[73] As the Court of Appeal stated in that case,[74]
it must be borne in mind that the power to terminate proceedings summarily should be exercised with caution and thus should not be exercised unless it is clear that there is no real question to be tried.
[73](2013) 42 VR 27 (‘Lysaght’).
[74]Lysaght, [35(d)].
I am not satisfied that there is no real question to be tried in respect of the VMIA Deed and the Guarantee Release Obligation. I accept the Plaintiff’s submission that there is a triable issue on the construction of the Guarantee Release Obligation in so far as it concerns the VMIA Deed. Despite the view expressed above, the Plaintiff’s claims in this regard are arguable.
Amongst other things, the VMIA Deed will need to be construed alongside the relevant legislation, being the DBC Act. That is not a task which should be undertaken summarily. Further, I was not taken to any authorities where questions such as this have been considered. I think it is highly likely that the VMIA Deed is in a standard form used throughout the domestic building industry. Even if there was no real prospect of success on these particular claims, for this reason I consider it appropriate that they continue to trial, pursuant to s 64 of the CPA.
Given my conclusion in respect of summary judgment on the VMIA Deed, I do not consider it appropriate to analyse, to the degree which the parties have, the competing arguments in any depth. The relevant questions are ones which should not be dealt with summarily and so their close consideration should await trial.
Further, I am not persuaded by the Defendants’ submissions that there is no justiciable controversy in respect of the Guarantee Release Obligation and the VMIA Deed.
I do not accept the Defendants’ submission that the irrevocability of the obligations in the VMIA Deed means that specific performance is impossible. The relevant irrevocability concerns the Plaintiff not being able to revoke his obligations; it does not prevent VMIA from releasing him from them. This point was conceded in oral submissions by Counsel for the Defendants.[75] Nonetheless, the evidence is that the VMIA has refused to release the Plaintiff from the VMIA Deed.[76]
[75]Transcript, 7.24.
[76]Exhibit TP-3 to the Papadopoulos Affidavit.
That specific performance is impossible due to VMIA’s refusal to release the Plaintiff from the VMIA Deed, is no answer here. I accept the Plaintiff’s submission that the Terms specifically provide for what is to happen if the Defendants are unable to obtain a release of the Plaintiff from a guarantee – the Charging Clause sets this out clearly.
I do not accept the Defendants’ submissions that any liability of the Plaintiff under the VMIA Deed is hypothetical such that the Court should not make the declarations sought. In this instance, a claim to which the DBC Act applies is on foot, being the VCAT Proceeding. It is not to the point that the VCAT Proceeding is brought by the Plaintiff’s sister who is represented by the Plaintiff’s lawyers in this proceeding. The VCAT Proceeding could result in a liability of the Second Defendant to the plaintiff in that proceeding, and just as there is no evidence that the Second Defendant will not be able to meet any judgment there, nor is there any evidence that it will be. While there are several remaining steps before the Plaintiff will be liable for a monetary sum under the VMIA Deed, those steps are not merely hypothetical when there is an actual claim on foot in VCAT and where the evidence suggests that the Second Defendant may no longer be trading.[77]
[77]The First Defendant deposes that since the Plaintiff ceased being a director of the Second Defendant on about 20 October 2016, the Second Defendant has not traded with any of the suppliers listed in the FBPs: First Meletis Affidavit, [24]. While it is not stated anywhere in the First Defendant’s affidavits that the Second Defendant is no longer trading, given the extensive list of suppliers with whom it is no longer trading, on the balance of probabilities this can be inferred. This is particularly so given that nowhere is it positively stated that the Second Defendant continues to trade.
In that scenario, the Charging Clause has work to do (if the VMIA Deed is covered by the Guarantee Release Obligation), and so a declaration in the form referred to in paragraph 15(b)(ii) above is not merely hypothetical.
In conclusion, therefore, it seems that summary judgment in the sense of specific performance in respect of the VMIA Deed is not available, but the relief sought by way of declarations may be. It cannot be said that there is no real prospect of success of the Court making those declarations.
Conclusion and Costs
For the reasons set out above, there will be orders made granting the Application in part. The Plaintiff’s claims in respect of the Supplier Obligations will be dismissed. The Plaintiff’s claims in respect of the Guarantee Release Obligation may proceed to trial, save that the relief sought should not include orders for specific performance of the Guarantee Release Obligation.
The parties are requested to confer as to the appropriate form of orders to give effect to these reasons, and given that this ruling is being delivered by email, the proceeding will be listed for 28 August 2020 for the making of orders and for the making of directions for the further conduct of the proceeding.
As referred to above, the Plaintiff submits that if his claims in respect of the Supplier Obligations are dismissed, then that is because they have been rendered otiose by the steps taken by the Defendants since the proceeding was issued. He submits that this represents a capitulation to the Plaintiff’s claims in that regard and, as such, he should have his costs of the proceeding in respect of those claims. It was only by issuing the proceeding that he could obtain substantial compliance with the Supplier Obligations, at least to the point where either summary dismissal was warranted due to there being no real prospect of success or due to the lack of proportionality in continuing to pursue them, such that they should be dismissed pursuant to the CPA.
The Defendants oppose the Plaintiff’s submissions in this regard. They say that the steps taken by them since the Proceeding was issued do not amount to a capitulation to the Plaintiff’s claim. They say that the First Defendant has deposed to numerous steps he took before the proceeding was issued, such that it ought to have been clear to the Plaintiff that he had no extant liability in respect of the Supplier Obligations.
In respect of the costs of the proceeding itself, so far as the claims regarding the Supplier Obligations are concerned, I do not consider that this case falls within that class of cases where one party has capitulated to the other, such that a costs order should follow. While the Defendants did take some steps prior to the proceeding being issued, they took further steps afterwards which have undoubtedly clarified the position in respect of some suppliers and obtained responses from some who had not previously responded. Therefore, in dismissing the Plaintiff’s claims in respect of the Supplier Obligations, I consider that the appropriate outcome regarding those costs is that there be no order as to the costs of those claims in the Proceeding.
The parties did not appear to specifically address the question of the costs of the Application.
In Towercom Pty Ltd v Fahour (No 4),[78] Derham AsJ canvassed the authorities dealing with the question of appropriate costs orders following an unsuccessful summary judgment application. He concluded that:[79]
The notes to Williams and the cases reveal a tension between the existence of a practice of making a ‘usual order’ that costs be in the cause and there being no such practice. The principles referred to above … confirm that there is no ‘rule’ of that kind and that, at best, the statements in Dawson v Watson and Harry Smith Car Sales are practices or guidelines. Those decisions put the decision as turning on whether the applicant for summary judgment should have known there was no reasonable chance of success. If that is the case, it is clearly right that costs should not be made in the cause but should follow the event.
It must, however, be steadily borne in mind that the discretion is not confined by any practice and where the circumstances do not neatly fit either ‘pole position’ exemplified in Dawson v Watson, on the one hand, and Harry Smith Car Sales, on the other, the appropriate starting point is to approach the exercise of the discretion in accordance with the settled practice of costs following the event.
For example, in some cases it may not have been so clear to the applicant that there was no real chance of success (although it might ultimately be clear after argument), in which case an order that the costs be in the proceeding (and follow the event at trial) may be appropriate. In other cases, there may be circumstances that point against making an order that leaves the costs to follow the event at trial. Whichever is appropriate turns on all the circumstances. There cannot be any better guide than that.
[78][2013] VSC 585, [6]-[15] (‘Towercom’).
[79]Towercom, [16]-[18].
In this case, the parties have each obtained partial success on the Application. This is not a case where I consider that the outcome ought to have been obvious, one way or the other, for the reasons I have set out above.
My preliminary view in respect of the costs of the Application is that the appropriate outcome is that they be the parties’ costs in the cause. As the parties’ submissions did not address this question, when the proceeding is listed for the making of orders the parties may address the Court further on it.
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