Perez v Ciabattoni (No 2)

[2024] NSWSC 262

Supreme Court

New South Wales

Medium Neutral Citation:

Perez v Ciabattoni (No 2) [2024] NSWSC 262

Hearing dates:

On the papers

Date of orders:

19 March 2024

Decision date:

19 March 2024

Jurisdiction:

Equity

Before:

Hmelnitsky J

Decision:

(1)   Defendant’s costs of the proceedings to be paid out of the plaintiff’s share of the estate on the ordinary basis.

(2)   No order as to the plaintiff’s costs.

Catchwords:

COSTS — Party/Party — General rule that costs follow the event — no question of principle

Cases Cited:

Haertsch v Whiteway (No 2) [2020] NSWCA 287

Salmon v Osmond [2015] NSWCA 42

Category:

Costs

Parties:

Maria Teresa Alessandra Perez (Plaintiff/Cross-Defendant)
Piero Dino Ciabattoni (Defendant/Cross-Claimant)

Representation:

Counsel:
K Morrissey (Plaintiff/Cross-Defendant)
S Bell (Defendant/Cross-Claimant)

Solicitors:
Turner Freeman (Plaintiff/Cross-Defendant)
Lloyd Truman Sadiq Solicitors (Defendant/Cross-Claimant)

File Number(s):

2022/366283

JUDGMENT

1. I delivered judgment in this matter on 23 February 2024: Perez v Ciabattoni [2024] NSWSC 138. These reasons should be read with that judgment.

2. In short, I held that Ms Perez’s claim for provision failed as adequate provision had been made for her under the will of her deceased mother. I further held that if and to the extent there was any lingering uncertainty as to whether the estate would yield a sufficient sum to meet her needs (a circumstance I held to be unlikely), this would probably be a function of the costs which the plaintiff’s mother and, subsequently, her estate had had to bear in trying to obtain possession of the family home from Ms Perez and then in defending these proceedings.

3. I left open the question of costs at the request of the parties and directed that short submissions be brought in to deal with that question. Mr Ciabattoni has provided short submissions, as directed. Ms Perez has not complied with that direction.

4. Mr Ciabattoni submits that his costs of the summons should be paid out of Ms Perez’s share of the estate on an ordinary basis, his costs of the cross-claim should be paid on an indemnity basis out of Ms Perez’s share of the estate and that Ms Perez should bear her own costs. That submission has some force given that the estate is to be shared as between Ms Perez and Mr Ciabattoni in equal shares and therefore any costs order to be paid from the estate (prior to distribution) will be suffered equally by both parties.

5. Indeed, even a costs order in one party’s favour, if made on the ordinary basis, will result in the parties sharing the difference between the costs incurred on the ordinary basis and the indemnity basis.

6. The relevant principles to be applied in determining the question of costs in a case such as this were explained by Beazley P in Salmon v Osmond [2015] NSWCA 42 at [170]-[174] and I respectfully adopt them. Her Honour said:

“[170] Pursuant to the Civil Procedure Act, s 98, costs are in the discretion of the court. Section 98 is subject to any other Act and the UCPR. UCPR, r 42.1 provides, relevantly, that costs follow the event, unless the court considers some other order ought to be made.

[171] The Civil Procedure Act, s 98 is subject to the Succession Act, s 99, which provides:

“99 Costs

(1)    The Court may order that the costs of proceedings under this Chapter in relation to the estate or notional estate of a deceased person (including costs in connection with mediation) be paid out of the estate or notional estate, or both, in such manner as the Court thinks fit.”

[172] As is implicit in s 99, family provision claims raise different issues with respect to costs which set them apart from other forms of litigation. As such, there are potentially different considerations from the ‘usual case’ where a claim under the Family Provision Act is unsuccessful: McCusker v Rutter [2010] NSWCA 318 at [33] per Young JA.

[173]   In Singer v Berghouse, Gaudron J noted, at [6], that:

“Family provision cases stand apart from cases in which costs follow the event … costs in family provision cases generally depend on the overall justice of the case. It is not uncommon, in the case of unsuccessful applications, for no order to be made as to costs, particularly if it would have a detrimental effect on the applicant's financial position. And there may even be circumstances in which it is appropriate for an unsuccessful party to have his or her costs paid out of the estate.” (citations omitted)

[174]   Nonetheless, the “overall justice of the case” referred to by Gaudron J is “not remote from costs following the event”: Jvancich v Kennedy (No 2) [2004] NSWCA 397. The only difference is that family provision cases call for additional “liberality and discrimination” in considering whether to exercise the discretion to override the usual rule: Chapple v Wilcox [2014] NSWCA 392 at [138]-[139]."

7. The gist of that approach is that the “overall justice of the case” is the key consideration, although that is not too far removed from the usual rule that costs follow the event. See also Haertsch v Whiteway (No 2) [2020] NSWCA 287 at [4]-[8].

8. In this instance, it is appropriate that Ms Perez should be made to bear at least some portion of Mr Ciabattoni’s costs out of her share of the estate. I have not only rejected her claim; on the facts I have found, she would not have needed to bring a claim in the first place if she had vacated the property when asked and the property had been sold in the ordinary course.

9. However, notwithstanding my criticisms of Ms Perez’s conduct in refusing to vacate the premises sooner, I do not consider her conduct to warrant an order for indemnity costs, even of the cross-claim for possession. I note that she does appear to have given a sensible undertaking to move out once the cross-claim was before the Court.

10. In reaching these conclusions I am mindful of the fact that Mrs Perez, whatever her faults in dealing with her brother, was at the same time dealing with the grief of losing her mother and facing the prospect of having to move out of the home she had lived in for decades. Her refusal to move out necessitated costs, both to her mother and to her mother’s estate, and this is a matter I have taken into account in reaching my conclusion that the claim should be dismissed. But when viewed in the light of the power to award costs, I do not consider that conduct to warrant an order for indemnity costs.

11. For these reasons, I make the following orders:

1. Defendant’s costs of the proceedings to be paid out of the plaintiff’s share of the estate on the ordinary basis.

2. No order as to the plaintiff’s costs.

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Decision last updated: 19 March 2024