Paradisis v Kekatos (as executor of the estate of the late John Paradisis)

[2016] NSWSC 662

Supreme Court

New South Wales

Medium Neutral Citation:	Paradisis v Kekatos (as executor of the estate of the late John Paradisis) [2016] NSWSC 662
Hearing dates:	12 May 2016
Date of orders:	25 May 2016
Decision date:	25 May 2016
Jurisdiction:	Equity - Duty List
Before:	Sackar J
Decision:	See para [17]
Catchwords:	COSTS – Indemnity Costs
Cases Cited:	Degman Pty Ltd (in Liq) v Wright (No. 2), [1983] 2 NSWLR 354 FAI General Insurance Co Ltd v Burns [1996] NSWCA 177 Latoudis v Casey (1990) 170 CLR 534 Dunstan v Rickwood (No 2) [2007] NSWCA 266, Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397
Category:	Costs
Parties:	Kaliopi Paradisis (plaintiff) Despina Kekatos as executor of the estate of the late John Paradisis (defendant)
Representation:	Counsel: S Kassem (plaintiff) M F Galvin (defendant)   Solicitors: C M Lawyers (plaintiff) P J Ellis & Co Solicitors (defendant)
File Number(s):	2015/115113
Publication restriction:	n/a

Judgment

Overview

1. In this matter McDougall J gave an ex tempore judgment on 8 March 2016. In that judgment his honour came to the view that the provision made by the will of the deceased for the plaintiff, the deceased’s wife of some 28 years, was inadequate. His honour awarded the plaintiff a legacy of $150,000 and a life estate capped at $700,000. This outcome necessitated the sale of what had been the matrimonial home.

2. By May 2016 it was asserted by the defendant that McDougall J’s orders were being thwarted and there was alleged physical interference with prospective purchasers to the point that a proposed orderly sale process was being obstructed. Hence the matter came into the Duty List on 12 May. Eventually all issues were sorted out between the parties save for the question of costs.

3. The defendant is the executor of the estate of the late John Paradisis. He submits correctly that orders were made on 17 March 2016 following his honour’s judgment centred upon the sale of a property at 22 Livingstone Road, Marrickville.

4. The defendant asserts the plaintiff consistently ignored correspondence from his solicitor which was directed to achieving a prompt and orderly sale. It is clear that numerous letters were sent in an endeavour to arrange the sale. It is submitted the plaintiff far from co-operating, actively obstructed attempts to arrange the sale.

5. On 6 May 2016 the defendant’s solicitors warned they would approach the Court if immediate co-operation was not forthcoming. Further attempts were then made by the defendant so that keys could be made available to enable access for open house inspections.

6. On 11 May 2016 (although there had it seems been an earlier hint on 3 May) and in an attempt no doubt to explain her attitude the plaintiff’s solicitor informed the defendant she was awaiting advice from Counsel about the possibility of an appeal from the decision of McDougall J. No application however was ever filed and that matter was not raised before the Court on 12 May 2016.

7. In the meantime evidence was prepared by the defendant in anticipation of a substantive dispute before the Court on 12 May 2016. As matters were resolved those materials were not deployed.

8. In the circumstances the defendant seeks the costs of relisting the matter before the Court on an indemnity basis which would I apprehend include the costs associated with preparing the relevant affidavit evidence.

9. The plaintiff does not dispute the defendant was entitled to attempt a prompt sale. The plaintiff says however she was finding it hard emotionally to detach herself from the property. She was also concerned about finding future accommodation. In addition, she was seeking advice on the prospects of appeal.

10. On 9 May a notice of a relisting was given, by the defendant. On 10 May 2016 the orders sought and supporting affidavits were served on the plaintiff and the solicitor. The plaintiff reiterated that she was awaiting advice from Counsel on the question of appeal. However that letter makes clear the advice would not be available until “early next week”.

11. It is accepted that the plaintiff finally came to terms with the fact that departure from the property would be inevitable. There is no evidence of when any advice was received, but by the time the matter was before the Court on 12 May the plaintiff had obviously accepted the property would be sold.

12. In all the circumstances the defendant seeks an order for indemnity costs or alternatively costs on an ordinary basis. The plaintiff seeks an order that each party pay its own costs.

13. The plaintiff submits an award of indemnity costs is not warranted. It is submitted the plaintiff was emotionally unable to come to terms she would have to vacate the property. The materials suggest the plaintiff clearly wanted to explore the possibility of challenging the decision of McDougall J. What she did however was not in my view warranted. Obstructing or interfering with the executor’s need promptly to organise the sale is simply not the appropriate course to take.

14. The applicable principles are not controversial. Costs are in the discretion of the Court. The power to award indemnity costs is to be found in s 98(1)(c) of the CPA. The discretion is absolute but it must be exercised judicially and be the subject of careful reasoning. The Court should exercise caution in awarding indemnity costs. In addition, there must be a sufficient or unusual feature such as a delinquency or unreasonable conduct. Behaviour which causes the other side to incur unnecessary expense and/or a failure to adhere to appropriate procedure will support an award of indemnity costs; Degman Pty Ltd (in Liq) v Wright (No.2), [1983] 2 NSWLR 354 at 358, FAI General Insurance Co Ltd v Burns [1996] NSWCA 177. Such an award should not be punitive and the conduct must be capable of being characterised as “plainly unreasonable”; Latoudis v Casey (1990) 170 CLR 534; Dunstan v Rickwood (No 2) [2007] NSWCA 266, Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397.

15. I am satisfied on the evidence that the plaintiff for perfectly understandable reasons was reluctant or unable to face the reality that a sale of the property was inevitable. However I am also satisfied that she behaved in a way which had the effect of delaying or obstructing the defendant in its need to organise the sale in an efficient manner. That was unreasonable on her part.

16. There were a number of things the plaintiff could legitimately have done. First an application for a stay of McDougall J’s orders could have been sought from his honour or the Court of Appeal. A notice of intention to appeal could have been filed. At the very least the plaintiff’s concerns could have been put before the Court in order to seek some delay or short term deferral of the sale process supported by appropriate medical or other evidence. None of these things were done and it was only after the defendant prepared its evidence and had the matter relisted did the plaintiff seemingly capitulate.

17. In these circumstances I am of the view the plaintiff should pay the costs of relisting the matter and preparation of the relevant affidavits on an indemnity basis.

18. I would invite Counsel to prepare short minutes of order reflecting my reasons and send them to my Associate.

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Decision last updated: 25 May 2016