Patten v Motor Traders' Association of New South Wales (No 2)

[2018] NSWSC 597

Supreme Court

New South Wales

Medium Neutral Citation:	Patten v Motor Traders’ Association of New South Wales (No 2) [2018] NSWSC 597
Hearing dates:	On the papers
Date of orders:	10 May 2018
Decision date:	10 May 2018
Jurisdiction:	Common Law
Before:	Lonergan J
Decision:	See [20]
Catchwords:	COSTS – amendment of defence – where amendment involves withdrawal of admissions – where evidence obtained in the process of exchange of statements supports withdrawal of admissions – where mediation had already taken place – unreasonableness of Plaintiff’s opposition to amendment given the explanation provided – mediation of less utility as a result of Defendant’s amendments
Legislation Cited:	Civil Procedure Act 2005 (NSW) s 98
Cases Cited:	Patten v Motor Traders’ Association of New South Wales [2018] NSWSC 392
Category:	Costs
Parties:	Gregory Patten (Plaintiff/Respondent) Motor Traders’ Association of New South Wales (Defendant/Applicant)
Representation:	Counsel: R Francois (Plaintiff/Respondent) P Moorhouse (Defendant/Applicant)     Solicitors: Employment Lawyers Australia (Plaintiff/Respondent) Moray & Agnew (Defendant/Applicant)
File Number(s):	2017/148267

Judgment

1. On 4 April 2018, I gave judgment in respect of an application by the Defendant to amend its Defence: Patten v Motor Traders’ Association of New South Wales [2018] NSWSC 392. I was asked to reserve the question of costs subject to written submissions.

2. I have received and read the written submissions of both parties as well as some of the documents provided as a “Confidential Exhibit” to the Affidavit of Ms Godfrey sworn 13 April 2018 which I also read.

3. I am of the view that none of the documents provided by way of “Confidential Exhibit” make any difference to the costs orders I propose to make. The parties provided, it seems by consent, a mediation paper by the Defendant which I did not read. I do not consider it appropriate to provide a party’s mediation paper on this costs application. Given the way the amendments arose at a time after the mediation was completed and the explanation for them contained in the Affidavit which I accepted in my primary judgment, I am of the view there is nothing in that position paper which would make any difference to the costs orders I make. Quite apart from this consideration, the confidentiality of the mediation should be protected.

Written submissions provided by the parties

4. The tone and content of the written submissions provided by the parties illustrate an oppositional, argumentative attitude to every issue bearing on costs, including, in the submissions filed on behalf of the Plaintiff, cavilling with my judgment.

5. The Defendant has it seems taken the finding I made regarding the description of the Plaintiff’s conduct as “unreasonable” as a basis to argue for punitive costs orders payable forthwith, in circumstances where the issue is before the Court because the Defendant’s solicitor filed a Defence that was missing an essential part.

6. The finding I made in [40] of my judgment was directed to the Plaintiff’s ongoing opposition to amendments proposed, despite sworn evidence from Mr O’Neill that raised the obvious evidentiary bases for the need to amend, and the Affidavit of Mr McDonald setting out a reasonable explanation as to how this came about.

7. The provision of the explanation by way of Affidavit does not however relieve the Defendant of responsibility for costs incurred related to the amendments, costs incurred by the Plaintiff in considering the proposed amendments required and the explanation for them, and the incomplete evidentiary basis upon which the mediation was conducted in late 2017.

8. The submissions of counsel for the Plaintiff create issues where there are none. Nowhere does my judgment say that Mr O’Neill should provide an explanation for what has occurred. Read correctly in context, paragraph [40] of my primary judgment is referring to the overall position of lack of cooperation taken by the Plaintiff’s legal representatives in their letter of 13 February 2018 which states baldly that no explanation has been provided, but makes no effort to pursue resolution of the issue by requesting one, or by inviting discussion, or by inviting a draft Affidavit so that any explanation can be evaluated.

Conclusion

9. It was evident by the content and tone of the letter of 13 February 2018 sent by the Plaintiff’s solicitor that there was no interest in pursuit of a negotiated course and that the Plaintiff required the issue to be dealt with by the Court. The tone of the letter is critical and combative.

10. The solicitor for the Defendant sent his Affidavit together with the Notice of Motion on 16 February 2018 and followed it with an exposition of argument and an invitation to resolve the matter set out in a letter of 27 February 2018.

11. The courtesy of an acknowledgement or a reply was not provided by the Plaintiff’s solicitor. The deponent of the Affidavit was requested for cross-examination and the Notice of Motion was fought on all issues.

12. Whilst there is no obligation on parties to concede points that are thought by the legal representatives to be necessary to pursue, such an approach will sound in orders for costs where the pursuit was fruitless.

13. Similarly, whilst omissions in preparation of a Defence will not necessarily mean a Defendant will be shut out of raising matters later found to be necessary to plead, where the explanation for this omission is accepted by the Court as adequate, such omissions will sound in orders for costs.

14. The Defendant was successful in obtaining the orders sought in its Notice of Motion – as it suggested it would be in its letter of 27 February 2018.

15. The Plaintiff’s continued opposition to the orders sought in the Notice of Motion was, after service of the Affidavit of 16 February, as I have already found in [40] of my judgment, unreasonable. I reiterate the finding I made to that effect for the purposes of this judgment on costs. Contrary to the submission made by counsel for the Plaintiff, I was in no way handicapped in the absence of submissions on costs, in coming to that conclusion.

16. However, the Defendant’s inadequacies of preparation as at the time of the mediation in late 2017 meant that the mediation must, of necessity, have proceeded on an incorrect appreciation of what the Defendant’s case would be.

17. Section 98 of the Civil Procedure Act 2005 (NSW) provides me with a wide discretion in relation to costs orders:

98   Courts powers as to costs

(1)   Subject to rules of court and to this or any other Act:

(a)   costs are in the discretion of the court, and

(b)   the court has full power to determine by whom, to whom and to what extent costs are to be paid, and

(c)   the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis.

(2)   Subject to rules of court and to this or any other Act, a party to proceedings may not recover costs from any other party otherwise than pursuant to an order of the court.

(3)   An order as to costs may be made by the court at any stage of the proceedings or after the conclusion of the proceedings.

(4)   In particular, at any time before costs are referred for assessment, the court may make an order to the effect that the party to whom costs are to be paid is to be entitled to:

(a)   costs up to, or from, a specified stage of the proceedings, or

(b)   a specified proportion of the assessed costs, or

(c)   a specified gross sum instead of assessed costs, or

(d)   such proportion of the assessed costs as does not exceed a specified amount.

…

18. Both parties have responsibility to bear regarding the costs associated with the Court’s determination of this application.

19. The Defendant’s letter dated 27 February 2018 sets out the arguments upon which the Defendant ultimately succeeded in its application. This reinforces that a further opportunity was specifically provided to the Plaintiff to resolve the application to amend without the need for argument in Court. The failure to take up this opportunity provides further support for the costs orders that I make against the Plaintiff.

20. I make orders as follows:

1. The Defendant is to bear its own costs of the preparation of the Notice of Motion and Affidavit in support up to and including 27 February 2017.

2. The Defendant is to pay the Plaintiff’s costs incurred in reviewing and responding to the Notice of Motion up to and including 27 February 2018.

3. The Plaintiff is to bear his own costs of opposing the Notice of Motion on and from 28 February 2018, including the costs of appearing at the hearing of the Notice of Motion including counsel’s fees incurred on and from 28 February 2018 associated with the opposition to the Notice of Motion.

4. The Plaintiff is to pay the Defendant’s costs of the Notice of Motion on and from 28 February 2018, including counsel’s fees.

5. The Defendant is to pay the Plaintiff’s costs of the mediation, including counsel’s fees.

6. Each party is to bear its own costs of the preparation of the written submissions on costs.

7. Both the Affidavit of Ms Kelly Godfrey sworn on 13 April 2018 and the “Confidential Exhibit” are to be removed from the Court file and to be returned to the solicitor for the Plaintiff.

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Decision last updated: 11 May 2018