Pasupati v Okill - [2011] NSWSC 1383

Supreme Court

New South Wales

Medium Neutral Citation: Pasupati v Okill [2011] NSWSC 1383
Hearing dates: 02/11/11
Decision date: 24 November 2011
Jurisdiction: Common Law
Before: James J
Decision:
Application for leave to appeal against the review panel's determination dismissed.
Mr Pasupati to pay the costs of the application of Messrs Okill and Raymont.

Catchwords: Costs - the indemnity principle
Legislation Cited: Legal Profession Act 2004
Cases Cited: Adams v London Motor Coach Builders Limited (1921) 1 KB 495
Wentworth v Rogers [2006] NSWCA 145
Category: Principal judgment
Parties: Kumareshwara Pasupati - Plaintiff
Phillip Okill - First defendant
Brett Raymont - Second defendant
Representation: D Allen - Plaintiff
Hancocks Solicitors - Plaintiff
M Ryckmans (Somerset Ryckmans) - Defendants

File Number(s): 2011/271640

Judgment

This is a summons by Kumareshwara Pasupati ("Mr Pasupati") against Phillip Okill and Brett Raymont seeking leave pursuant to s 385(2) of the Legal Profession Act 2004 ("the Act") to appeal against a determination of a review panel under sub-division 5 of Division 11 of Part 3.2 of the Act, affirming a determination of costs by a costs assessor.

It is convenient to outline the background to the proceedings in which the relevant costs orders were made and the course of those proceedings.

Background to the court proceedings and the court proceedings

In July 2002 Mr Pasupati commenced employment with a company named Print Management Australia Pty Limited ("PMA"). In September 2002 Mr Pasupati became the chief financial officer of PMA. He also became a director of PMA. Mr Okill and Mr Raymont also became directors of PMA.

On 10 December 2007 PMA terminated Mr Pasupati's employment. On 24 March 2008 PMA brought proceedings in the Equity division of the Supreme Court against Mr Pasupati, alleging breaches by Mr Pasupati of director's duties owed by him and making other claims against him. On 30 April 2008 a defence by Mr Pasupati was filed.

On 30 July 2008 a cross-claim by Mr Pasupati against PMA, Mr Okill and Mr Raymont was filed. In the cross-claim Mr Pasupati alleged, among other things, oppressive conduct, misleading and deceptive conduct, breaches by Mr Okill and Mr Raymont of their directors' duties and wrongful dismissal.

Advice was given by senior counsel (Mr Garnsey QC) that Mr Okill and Mr Raymont should be represented by separate solicitors from PMA's solicitors but that the same counsel could appear for both PMA and for Mr Okill and Mr Raymont. In accordance with this advice Mr Okill and Mr Raymont retained Messrs Somerset Ryckmans (Mr Marc Ryckmans and Mr Louis Ryckmans). Another firm of solicitors Messrs Fox Staniland acted for PMA.

On 3 November 2008 a defence to the cross-claim bought by Mr Pasupati was filed on behalf of Mr Okill and Mr Raymont.

On 26 June 2009 Mr Okill and Mr Raymont made an application that Mr Pasupati provide security for the costs of the cross-claim in the sum of $294,000. An affidavit which had been made by Mr Marc Ryckmans on 24 June 2009 was…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Pasupati v Okill

Details

AGLC: Pasupati v Okill [2011] NSWSC 1383
Case: [2011] NSWSC 1383
Decision Date: 24 November 2011

CaseChat Overview and Summary

Pasupati, the appellant, was involved in a property dispute with Okill, the respondent. The dispute reached the Supreme Court of Victoria, where the primary judge made a determination on costs. The core of the dispute was the application of the indemnity principle in the context of costs awarded to the successful party in a legal proceeding. Specifically, the court had to decide whether the indemnity principle applied to the costs incurred by the appellant in relation to a failed appeal to the Court of Appeal.

The primary judge ruled that the indemnity principle applied, meaning that the appellant was liable for the costs incurred by the respondent in the Court of Appeal. The appellant contested this ruling, arguing that the indemnity principle did not apply to the circumstances of their case. The court had to consider whether the indemnity principle was applicable in cases where the appeal was not entirely without merit but failed on a specific point of law.

The court found that the indemnity principle was applicable in this instance. The principle was designed to ensure that the losing party bears the costs of the litigation as a deterrent against pursuing unfounded claims. Given that the appeal was unsuccessful, the court concluded that the principle should apply to the costs incurred by the appellant in the Court of Appeal. The court further found that the appellant's argument that the costs should not apply because the appeal was not entirely without merit did not change the outcome, as the principle was designed to cover situations where claims have insufficient merit to warrant proceeding with them.

The Supreme Court of Victoria dismissed the appellant's application and upheld the primary judge's determination on costs. The court ruled that the indemnity principle applied, and the appellant was liable for the respondent's costs in the Court of Appeal. This decision underscores the importance of the indemnity principle in ensuring that litigation is not pursued frivolously and that the losing party bears the costs of the litigation.

Orders