Patelis v Sander (No 4) - [2022] SADC 40

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Interlocutory Application)
PATELIS v SANDER (No 4)
[2022] SADC 40
Judgment of his Honour Judge Burnett
31 March 2022
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - GENERAL RULE: COSTS FOLLOW EVENT - GENERAL PRINCIPLES AND EXERCISE OF DISCRETION
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - INTERLOCUTORY PROCEEDINGS
EVIDENCE - ADMISSIBILITY - EXCLUSIONS: PRIVILEGES - CLIENT LEGAL PRIVILEGE - LOSS OF PRIVILEGE
The respondent brought interlocutory applications:
(1) for the production of privileged material of the applicant on the basis that privilege had been waived;
(2) for leave to file an amended defence; and
(3) for leave to file cross claims against the two interested parties, Tolis & Co and Mr Christian Munt.
The application for the production of privileged material was dismissed on 21 May 2021. The application to file an amended defence was granted after the respondent had produced a fourth draft of his proposed defence. On receipt of that draft the applicant withdrew her opposition to the application. The application for leave to issue a cross claim against Tolis & Co was granted. The application for leave to issue a cross claim against Mr Munt was refused.
The parties all sought costs in relation to the applications.
Held:
1.      The respondent should pay the applicant’s costs on the standard costs basis in relation to the application for production of privileged material. The applicant was successful in opposing that application.
2.      That application should be considered separately from the applications to amend the defence and issue cross claims. The applications were distinct applications and heard at different times and in the case of the applications to issue a cross claim, different parties participated in the hearing of that application.
3. There had been no pleading into relevance by the applicant of any privileged material such that privilege had been waived: Hongkong Bank v Murphy [1993] 2 VR 419 and Southern Equities Corporation Ltd (in liq) v Arthur Andersen & Co (1997) 70 SASR 166 applied.
4.      Costs should be determined by reference to the circumstances existing at the time of the application and not by reference to future possibilities.
5.      There was no conflict between the applicant and Tolis & Co such that the applicant should be denied her costs for any period of time. It was in both of those parties’ interests to oppose the application for production of privileged material.
6. The applicant is entitled to her costs associated with the amendment of the defence up until the delivery of the fourth draft of the proposed defence (at which time the applicant withdrew her opposition to the amendment): Coastal Ecology Protection Group Inc v City of Charles Sturt [2020] SASC 215 applied.
7.      The respondent could not be considered the successful party in an application to amend the defence when that amendment was granted. The respondent had sought and was granted an indulgence.
8.      Mr Munt was wholly successful in opposing…

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 Patelis v Sander (No 4)

Details

AGLC: Patelis v Sander (No 4) [2022] SADC 40
Case: [2022] SADC 40
Decision Date: 31 March 2022

CaseChat Overview and Summary

In the matter of Patelis v Sander (No 4), the applicant sought an order for costs against the respondent and a third party, Tolis & Co, relating to various applications in the proceeding. The case was before the Supreme Court of South Australia. The legal issues at hand involved the entitlement to costs following various interlocutory applications, particularly those concerning the production of privileged material, the amendment of a defence, and the issuance of a cross claim. The court also had to consider whether the applicant had waived privilege over certain documents and whether the parties were in conflict to the extent that costs should be denied.

The court examined the general principles governing costs in civil proceedings, particularly the rule that costs generally follow the event. It found that the applicant was successful in opposing the application for the production of privileged material and thus was entitled to costs on the standard costs basis. The court emphasised that the applications for the amendment of the defence and the issuance of a cross claim were distinct and should be considered separately. It found no evidence that the applicant had waived privilege over the material in question. The court also ruled that costs should be assessed based on the circumstances existing at the time of the application, rather than by reference to future possibilities.

The court concluded that the applicant was entitled to costs for the amendment of the defence up until the delivery of the fourth draft, after which the applicant withdrew her opposition. The respondent, despite having the defence amendment granted, was not considered the successful party in that application as the amendment was an indulgence. Regarding the cross claim, the applicant and Tolis & Co were both wholly successful in opposing the application and were thus entitled to their costs. Tolis & Co was also entitled to oppose the cross claim application up until the fourth draft of the defence, after which the costs should be borne by the respondent. The court's decision was based on a careful consideration of the circumstances of each application and the interests of the parties involved.

The court ordered that the respondent pay the applicant’s costs on the standard costs basis in relation to the application for production of privileged material. It also determined that the costs of the application to amend the defence and the application to issue a cross claim should be borne by the respective parties as outlined in the decision. The court found that there was no conflict between the applicant and Tolis & Co that would warrant denying costs and thus both parties were entitled to recover their costs from the respondent.

Orders

Orders of the court

Held:

1. The respondent should pay the applicant’s costs on the standard costs basis in relation to the application for production of privileged material. The applicant was successful in opposing that application.

2. That application should be considered separately from the applications to amend the defence and issue cross claims. The applications were distinct applications and heard at different times and in the case of the applications to issue a cross claim, different parties participated in the hearing of that application.

3. There had been no pleading into relevance by the applicant of any privileged material such that privilege had been waived: Hongkong Bank v Murphy [1993] 2 VR 419 and Southern Equities Corporation Ltd (in liq) v Arthur Andersen & Co (1997) 70 SASR 166 applied.

4. Costs should be determined by reference to the circumstances existing at the time of the application and not by reference to future possibilities.

5. There was no conflict between the applicant and Tolis & Co such that the applicant should be denied her costs for any period of time. It was in both of those parties’ interests to oppose the application for production of privileged material.

6. The applicant is entitled to her costs associated with the amendment of the defence up until the delivery of the fourth draft of the proposed defence (at which time the applicant withdrew her opposition to the amendment): Coastal Ecology Protection Group Inc v City of Charles Sturt [2020] SASC 215 applied.

7. The respondent could not be considered the successful party in an application to amend the defence when that amendment was granted. The respondent had sought and was granted an indulgence.

8. Mr Munt was wholly successful in opposing the application for leave to issue a cross claim against him. There was no reason why he should be denied his costs.

9. Tolis & Co were entitled to oppose the application for leave to issue a cross claim against it up until the delivery of the fourth draft of the defence (which was incorporated into the cross claim): Coastal Ecology Protection Group Inc v City of Charles Sturt [2020] SASC 215 applied. It was only when that fourth draft was provided that the cross claim was in an acceptable form.

10. Tolis & Co ought to pay the costs of the respondent subsequent to the delivery of the fourth draft of the defence: Raedel & Raedel v Shahin (No 2) [2018] SASC 119 and Hanssen v Commonwealth of Australia & Ors (No 2) [2019] SASC 90 distinguished.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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