Playford Vineyard Pty Ltd (ACN 604 608 157) v Wishford Nominees Pty Ltd (ACN 008 077 236) (No 4) - [2020] SASC 204

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
PLAYFORD VINEYARD PTY LTD (ACN 604 608 157) v WISHFORD NOMINEES PTY LTD (ACN 008 077 236) (No 4)
[2020] SASC 204
Judgment of The Honourable Justice Stanley
23 October 2020
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - ISSUES AND COUNTERCLAIMS - FAILURE IN PORTION OF CASE
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - INTERLOCUTORY PROCEEDINGS - GENERALLY
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - DEPRIVING SUCCESSFUL PARTY OF COSTS - POWERS OF COURT AND RELEVANT CONSIDERATIONS IN EXERCISE OF DISCRETION
These are proceedings in relation to a vineyard in the Riverland. The vineyard is owned by the plaintiff. It was sold to the plaintiff by the defendant in 2015. The sale was subject to an agreement to lease back the vineyard to the defendant and an annual option to repurchase. The plaintiff and the defendant entered into a lease agreement. The lease agreement included an option to purchase the vineyard. The plaintiff alleged the defendant contravened the terms of the lease by its mismanagement of the vineyard in such a way as to reduce productivity and diminish its value by failing to cultivate, maintain and manage the vineyard in a proper and husband-like manner. In 2017 the plaintiff purported to terminate the lease and to re-enter the land. Following its re-entry the plaintiff undertook certain works upon the vines.
The principal issues in the proceedings were whether the defendant was in breach of the lease, and the terms of any option the defendant had to re-purchase the vineyard.
The Court found that the defendant was not in breach of its lease obligations. Accordingly, the plaintiff was not entitled to terminate the lease and re-enter. It also found on the proper construction of the agreement between the parties that the defendant did not enjoy a right to exercise an option to re-purchase the vineyard in 2018. Finally, the Court rejected the defendant’s application for rectification.
At the trial the parties agreed to defer the question of any resulting assessment of damages to a subsequent hearing once the issues of liability had been determined. The plaintiff unsuccessfully appealed to the Full Court. Its application for special leave to appeal to the High Court was dismissed.
Costs orders of the trial and multiple interlocutory applications are now sought.
Held:
1. The defendant’s conduct does not disentitle it to an award of costs in relation to the issues on which it succeeded.
2. The plaintiff is to pay the defendant 80 per cent of its costs of and incidental to the trial on a party/party basis, to be agreed or taxed.
3. The defendant is to pay the plaintiff its costs of the application of 25 July 2018 setting aside a creditor’s statutory demand.
4. The plaintiff is to pay the defendant its costs of the application to file a third points of claim and a third points of reply and second defence to cross-claim, and its costs thrown away as a consequence of that part of the application that was successful, on a party/party basis to be agreed or taxed.
5. The defendant is to pay the plaintiff 50 per cent of its costs of the application seeking preservation orders on a party/party basis to be agreed or taxed.
6. The defendant is to pay the plaintiff its costs of the application of 8 November 2019 seeking a freezing order on a party/party basis to be agreed or taxed.
7. No costs orders are made with respect to the other applications in this action.
A, DC v Prince Alfred College Inc (No 2) [2016] SASCFC 27; Knight Frank Australia Pty Ltd v Paley Properties Pty Ltd (2014) 120 SASR 532, applied.
Ottway v Jones [1955] 1 WLR 706; ACCC v Australian Safeway Stores Pty Ltd (No. 3) [2002] FCA 1294; Verna Trading v New India Assurance Co Ltd [1991] 1 VR 129, discussed.
Colgate-Palmolive Company and Anor v Cussons Pty Ltd (1993) 46 FCR 225, considered.

PLAYFORD VINEYARD PTY LTD (ACN 604 608 157) v WISHFORD NOMINEES PTY LTD (ACN 008 077 236) (No 4)
[2020] SASC 204
Civil
STANLEY J:
Introduction

These are proceedings in relation to a vineyard in the Riverland. The vineyard is owned by the plaintiff. It was sold to the plaintiff by the defendant in 2015. The sale was subject to an agreement to lease back the vineyard to the defendant and an annual option to repurchase. The plaintiff and the defendant entered into a lease agreement. The lease agreement included an option to purchase the vineyard. The plaintiff alleged the defendant contravened the terms of the lease by its mismanagement of the vineyard in such a way as to reduce productivity and diminish its value by failing to cultivate, maintain and manage the vineyard in a proper and husband-like manner. In 2017 the plaintiff purported to terminate the lease and to re-enter the land. Following its re-entry the plaintiff undertook certain works upon the vines.
The principal issues in the proceedings were whether the defendant was in breach of the lease, and the terms of any option the defendant had to re‑purchase the vineyard.
The defendant denied that it breached the terms of the lease. It asserted that the option to re-purchase could be exercised during the lease term in 2018. In the alternative, the defendant sought rectification of the land sale contract and the memorandum of lease in relation to the option to re-purchase.
The Court found that the defendant was not in breach of its lease obligations. Accordingly, the plaintiff was not entitled to terminate the lease and re-enter. It also found on the proper construction of the agreement between the parties that the defendant did not enjoy a right to exercise an option to re-purchase the vineyard in 2018. Finally, the Court rejected the defendant’s application for rectification.
At the trial the parties agreed to defer the question of any resulting assessment of damages to a subsequent hearing once the issues of liability had been determined. The plaintiff unsuccessfully appealed to the Full Court. Its application for special leave to appeal to the High Court was dismissed.
The parties now come before the Court seeking orders for costs.
The defendant seeks an order that it have 100 per cent of the costs of and associated with the interlocutory proceedings up to and including 31 October 2017 and 95 per cent of the costs of the trial. The plaintiff opposes that application and seeks orders that the defendant pay the plaintiff’s costs of the trial including in relation to those issues on which the defendant succeeded, because of the defendant’s significant misconduct in withholding from the plaintiff and the Court its intention to undertake under vine trimming; or, in the alternative, that the defendant pay the plaintiff’s costs of and incidental to the issues of breach of the lease and re-entry incurred prior to 9 February 2018; or, in the further alternative, that the parties bear their own costs of and incidental to the issues of breach of the lease and re-entry.
Principles applicable to the award of costs
In A, DC v Prince Alfred College Inc (No 2)[1] the Full Court explained the modern approach to the award of costs as follows:[2]
[1] [2016] SASCFC 27.
[2] [2016] SASCFC 27 at [5]-[13].
The principles governing the exercise of the costs discretion are well established. The Court exercises a judicial discretion with respect to costs in which the general rule is that costs ordinarily follow the event unless there are special circumstances justifying another order. In more recent times, courts more readily modify the general rule recognising that the interests of justice sometimes require a reduction in the costs that would otherwise have been awarded to a successful party when that party has failed on particular disputed questions of fact or law. In Ruddock v Vardalis (No 2), Black CJ and French J summarised the principles as follows:
Within the general discretion of the courts to award costs it is accepted by decisions in both Australian and English jurisdictions that:
·    Ordinarily costs follow the event and a successful litigant receives costs in the absence of special circumstances justifying some other order.
·    Where a litigant has succeeded only upon a portion of the claim, the circumstances may make it reasonable that the litigant bear the expense of litigating that portion upon which he or she has failed.
·    A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other parties' costs of them. In this sense “issue” does not mean a precise issue in the technical pleading sense but any disputed question of fact or law.
The modification of the ordinary rule to reflect the way in which particular issues in the litigation are determined is a response to those ‘cases in which issues are raised which unduly extend the time and expense of litigation’.
In Victoria and Master Builders Association of Victoria Ormiston JA explained that in an era of high cost litigation it had become necessary to more often allocate costs according to success on particular issue[s] because ‘regrettably there are many cases in which issues are raised which unduly extend the time and expense of litigation’. Those observations were echoed in Mickelberg v Western Australia by Newens J who referred also to ‘the burdens imposed on the public resources of the Court’ by parties pursuing claims on which they are ultimately not successful.
Just as parties must make a cost benefit and risk analysis decision on whether to bring an action at all, so too must decisions be made about which claims to include within an action. Parties should not be encouraged to add to a claim which has sufficient prospects, in itself, to justify the bringing of an action other claims, of doubtful merit, on the assumption that the costs of pursuing the latter claims will be recovered because of success on the good claim.
In adversarial litigation the parties and their legal advisors carry the primary responsibility for ensuring the cost-effectiveness of litigation because they have a particular knowledge and understanding of the controversy, and the available evidence, which the court cannot know because of legal professional privilege.
It is therefore the responsibility of the legal profession to actively consider the affect of adding doubtful claims, or mounting defences to good claims without any foundation for doing so, on the efficient resolution of the proceedings. In accordance with that duty legal practitioners must give advice on the relative merits of the possible claims and defences and on the cost and time implications of pursuing those claims so that the litigant is in a position to give informed instructions on how to conduct the proceedings.
The authorities to which we have referred make it clear that the rule does not only apply to a ‘precise issue in the technical pleading sense’ but extends to any substantial disputed question of fact or law. There is of course a limit to the dissection of an action which is practicably possible.
On the other hand, the court should not be overly parsimonious in the award of costs to a plaintiff who has won a judgment against a wrongdoer who has denied liability on all of the grounds of the plaintiff’s claim.
There can be no precision in the balancing of the tension between the ordinary rule and its qualification. Much will depend on the extent to which the costs of the litigation of the separate issues can easily be separated out and on the reasonableness of the forensic decision of the successful party to pursue, not only the claims on which he or she succeeded, but also those claims on which he or she failed.
[citations omitted]
The plaintiff seeks costs of the issues on which it was unsuccessful at trial
The plaintiff seeks an order that it have the costs of the issues on which the defendant succeeded at trial, namely, the breach of the lease, repudiation and re-entry. The basis of the application is the contention that the defendant should be deprived of its costs on those issues and the plaintiff should be entitled its costs on those issues because of the defendant’s misconduct in, or leading up to, the litigation which effectively invited the litigation and unnecessarily protracted the proceedings. The misconduct alleged is that the defendant did not tell the plaintiff that it intended to, and would, undertake the work required to comply with the default notice to prune the under vines to remove low hanging canes and/or water shoots. It also alleges that the defendant’s disclosure of documents in relation to this topic was late.
The plaintiff contends that had the defendant notified it of its intention to undertake this work before it terminated the lease and took proceedings to re‑enter the vineyard, the plaintiff would not have done so. The plaintiff submits that the litigation would not have occurred or it would have been resolved at an early stage had this occurred. In the circumstances it says that the defendant’s failure to inform it of its intentions was the principal cause of the litigation and constitutes disentitling conduct.
The plaintiff relies on the following statement of principle by Blue J, with whom Sulan and Parker JJ agreed, in Knight Frank Australia Pty Ltd v Paley Properties Pty Ltd:[3]
[3] [2014] SASCFC 103 at [54]-[59], (2014) 120 SASR 532 at 544.
One exception or qualification arises when the costs of litigation have been caused or increased by misconduct by a party in or leading up to the litigation.
In Oshlack v Richmond River Council, McHugh J considered whether the successful party should be deprived of costs due to misconduct:
The traditional exceptions to the usual order as to costs focus on the conduct of the successful party which disentitles it to the beneficial exercise of the discretion. In Anglo‑Cyprian Trade Agencies Ltd v Paphos Wine Industries Ltd, Devlin J formulated the relevant principle as follows:
"No doubt, the ordinary rule is that, where a plaintiff has been successful, he ought not to be deprived of his costs, or, at any rate, made to pay the costs of the other side, unless he has been guilty of some sort of misconduct."
"Misconduct" in this context means misconduct relating to the litigation, or the circumstances leading up to the litigation. Thus, the court may properly depart from the usual order as to costs when the successful party by its lax conduct effectively invites the litigation; unnecessarily protracts the proceedings; succeeds on a point not argued before a lower court; prosecutes the matter solely for the purpose of increasing the costs recoverable; or obtains relief which the unsuccessful party had already offered in settlement of the dispute.
In Colgate-Palmolive Company and Anor v Cussons Pty Ltd, Sheppard J considered whether to make an order against an unsuccessful party on a solicitor and client or indemnity basis due to misconduct:
[I]t is useful to note some of the circumstances which have been thought to warrant the exercise of the discretion. I instance the making of allegations of fraud knowing them to be false and the making of irrelevant allegations of fraud evidence of particular misconduct that causes loss of time to the Court and to other parties; the fact that the proceedings were commenced or continued for some ulterior motive or in wilful disregard of known facts or clearly established law; the making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions; an imprudent refusal of an offer to compromise and an award of costs on an indemnity basis against a contemnor. Other categories of cases are to be found in the reports. Yet others to arise in the future will have different features about them which may justify an order for costs on the indemnity basis. The question must always be whether the particular facts and circumstances of the case in question warrant the making of an order for payment of costs other than on a party and party basis.
The first step in deciding whether the misconduct exception or qualification applies is to determine whether the conduct of a party amounts to relevant misconduct within the meaning of the established authorities. When considering that question, the actual conduct of the party that is the subject matter of the action does not itself qualify as relevant misconduct. The mere fact that the evidence of a party is rejected does not in itself qualify as relevant misconduct.
The second step, if it is concluded that a successful party has been guilty of relevant misconduct, is to analyse whether, and if so the extent to which, the relevant misconduct has caused or contributed to the existence, continuation or extent of the litigation and hence to the incurring of costs in the litigation.
The third step, if the misconduct of a party has caused or contributed to the incurring of costs in the litigation, is to determine what is the appropriate costs order. In general terms, it may be expected that a court will be less ready to deprive a successful party of the whole of its costs of action rather than a part, less ready to order a successful party to pay its opponent’s costs of action rather than being deprived of an order for its own costs, and less ready to order a successful party to pay its opponent’s costs of action on a solicitor and client basis rather than on a party and party basis.
[citations omitted]
I do not accept this submission. In my view, the defendant’s conduct does not disentitle it to an award of costs in relation to the issues on which it succeeded. I reach this conclusion for three reasons. First, the conduct relied upon by the plaintiff is not misconduct of the kind contemplated by the authorities. As is made clear by the Full Court in Knight Frank the actual conduct of the party that is the subject matter of the action does not itself qualify as relevant misconduct. Accordingly, the plaintiff’s claim that the defendant’s failure to notify it, prior to 4 September 2017, of its intention to conduct this work constituted a breach of its lease obligations, is not relevant misconduct. The defendant was not under a lawful obligation to notify the plaintiff of its intention to do the work, at least until it had to make disclosure. While the disclosure made was outside the time prescribed by the Court’s orders, as was service of relevant affidavits,[4] I do not consider that is misconduct of the relevant kind. The nature of the requisite misconduct is illustrated by the examples cited from the passage of the judgment of Sheppard J in Colgate-Palmolive. What is required is misconduct which goes beyond the legitimate defence of the claim brought against the party the subject matter of the action, e.g. the making of false allegations of fraud or irrelevant allegations of fraud; raising defences known not to have any support in the facts or contrary to clearly established law; the making of allegations which should not have been made or the undue prolongation of the case by the raising of obviously unmeritorious defences. The categories are not closed. In Ottway v Jones[5] Lord Evershed MR said:[6]
… where a plaintiff in the end fails, it must be a very unusual thing to order the successful defendant to pay the costs; and it would only be in exceptional cases that a judge would think it right to make such an order.[7]
[4] The affidavit of Mr Curtis and the second affidavit of Mr Falcinella.
[5] [1955] 1 WLR 706.
[6] [1955] 1 WLR 706 at 711.
[7] Cited with approval by the Full Court of the Supreme Court of Victoria in Verna Trading Pty Ltd v New India Assurance Co Ltd [1991] 1 VR 129 at 154.

The misconduct must be of a kind or character that would compel a departure from the usual rule that costs follow the event. The defendant’s conduct is not of this kind.
Second, and in any event, the plaintiff has failed to establish the underlying counterfactual premise to its contention. I am not satisfied that the plaintiff would not have pursued its claim that the defendant was in breach of the lease and that the plaintiff was within its rights to re-enter the property if the defendant had advised earlier of its plan to undertake under vine trimming. The vigour with which the plaintiff prosecuted these proceedings for the purpose of depriving the defendant of its asserted right to exercise an option to repurchase the vineyard does not permit me to find that it would not have prosecuted the action had the defendant advised it of its intention to undertake that work earlier.[8] After all, the plaintiff’s case against the defendant for breach of the lease was not confined to a failure to undertake under vine trimming. For example, much of its case was based on an allegation of it failing to maintain a viable upper cordon. It cannot be concluded that by its lax conduct the defendant effectively invited the litigation. Further, once it became apparent to the plaintiff that the defendant’s case was that it planned to undertake under vine trimming it did not abandon that part of its claim. I find that the plaintiff would have commenced the action even if it was aware of the defendant’s intentions. The plaintiff had an underlying commercial purpose in retaining ownership of the vineyard.
[8] A significant part of its case on the option to repurchase was that no option was extant, inter alia, because the lease had been terminated for breach or repudiation.
Third, it is relevant that the plaintiff is seeking costs orders against a successful defendant. In Verna Trading Pty Ltd v New India Assurance Co Ltd[9] Kaye J said:[10]
More compelling circumstances are required for the exercise of discretion as a result of which a successful defendant is not only denied his costs but also compelled to pay the whole or part of the plaintiff’s costs of the proceedings. This is so for the reason that proceedings are initiated by the plaintiff and the plaintiff fails to gain the relief which he sought.
[9] [1991] 1 VR 129.
[10] [1991] 1 VR 129 at 154.
A similar view was expressed by Goldberg J in ACCC v Australian Safeway Stores Pty Ltd (No. 3)[11] where his Honour noted in the context of considering the apportionment of costs where a respondent has been successful in the outcome, but unsuccessful on some issues, contrasted with the position where a successful applicant has raised some issues on which it has failed:[12]
I consider that a court should look more benignly on the question of costs of a respondent who has been compelled to come to court and defend itself on a ground not of its own choosing than on an applicant who chooses to raise issues on a ground of its choosing.
[11] [2002] FCA 1294.
[12] [2002] FCA 1294 at [55].
There is no disentitling conduct made out. The defendant is entitled to its costs on the issues on which it succeeded.
Costs orders
In accordance with the principles in A, DC v Prince Alfred College Inc (No 2)[13] I consider that it is appropriate to make orders in relation to costs which reflect the respective successes and failures of the parties on the issues. What constitutes an issue is not to be understood in the strict technical sense. The plaintiff succeeded on the issues of the exercise of the option and the availability of the option to repurchase in 2018. It also succeeded on the issue of rectification. These issues occupied a small part of the witness statements, trial time and submissions. I would estimate that this amounted to about 10 per cent of the proceedings. The defendant succeeded on the issues of breach, repudiation and re-entry. I would estimate that this amounted to about 90 per cent of the proceedings. In the circumstances I would make one consolidated order in respect of the costs of the trial reflecting the basis upon which each party succeeded or failed.
[13] [2016] SASCFC 27.
I would make one order in respect of the costs of and incidental to the trial, namely, that the plaintiff is to pay the defendant 80 per cent of its costs of the trial, including preparation of the action for trial, on a party/party basis, to be agreed or taxed.
The parties also seek orders in relation to various interlocutory applications brought by the plaintiff, namely, an interlocutory application of 15 December 2017 seeking preservation orders in relation to the 2018 vintage; an interlocutory application dated 19 July 2018 to stay the judgment of 22 June 2018; an interlocutory application dated 25 July 2018 which sought a further order setting aside a creditor’s statutory demand issued by the defendant; and an interlocutory application of 29 August 2018 which sought, in effect, to vary the previous orders of the Court made on 20 December 2017 to permit sale of the wine made from the grapes and for the proceeds of the sale to be paid into the Suitors’ fund. There was a further procedural application brought by the defendant seeking to have these interlocutory applications, except for the application seeking the preservation orders, heard by me rather than Bampton J.
There is a substantial history to these applications, including significant correspondence between the parties. It is unnecessary to set out the details of this history. It is sufficient to observe that, except for the first interlocutory application seeking preservation orders, which were made in the course of the trial, the remaining applications were made subsequent to delivery of judgment in this matter; were made by the plaintiff seeking to avoid making payment to the defendant of the proceeds of the 2018 vintage pending the hearing and determination of the plaintiff’s appeal to the Full Court; were opposed by the defendant; and largely granted by the Court (except for the procedural application relating to the hearing before Bampton J). The plaintiff seeks its costs of these applications. Subject to one matter, the defendant opposes that application and submits that it is entitled to its costs of these applications. The exception is the application to set aside the statutory demand. The defendant accepts the plaintiff is entitled to its costs of that application.
In short, the plaintiff contends that costs should follow the event. The defendant submits that the costs of these interlocutory applications should be costs in the cause and treated as part of the costs of the overall action and that it should have its costs, or most of its costs, of these applications on the same basis that it is entitled to the costs of the action.
In addition, there are two further applications which are not in issue. First, an application by the plaintiff dated 11 November 2019 to file a third points of claim and a third points of reply and second defence to cross-claim. Except for the plea in paragraph 15 of the proposed third points of reply and second defence to cross-claim, which raised an allegation concerning management of the vineyard by the defendant subsequent to the plaintiff’s re-entry, this application was dismissed. The plaintiff does not oppose an order that it pay the defendant’s costs of the application and the defendant’s costs thrown away as a result of the filing of the third points of reply and second defence to cross-claim. Second, an application by the defendant dated 8 November 2019 for a freezing order. This was dismissed. The defendant does not oppose an order that it pay the plaintiff’s costs of the application.
There was also an interlocutory application brought by the plaintiff for an order requiring a third party, Hill River Estate Wines Pty Ltd, an entity controlled by the Wake family, to produce the Collard pruner for inspection. The plaintiff sought to inspect the pruner for the purpose of obtaining evidence that its use by the defendant affected the productivity of the 2018 vintage which would sound in damages. The plaintiff brought the application on the basis that the pruner had been modified by the defendant. In that regard Mr Falcinella had given evidence at the trial that engineering work had been undertaken to modify the pruner to do the under vine trimming. This application was ultimately abandoned but the plaintiff seeks an order for the costs of bringing the application. It does so on the basis that it abandoned the application after it was informed by the solicitors for the defendant that the pruner had only been modified to the extent of fitting a factory standard extension of low angled cutters. The plaintiff submits that the application would have been unnecessary if the defendant had advised earlier that the evidence given by Mr Falcinella merely referred to the fitting of a factory standard extension. I do not accept this submission. The defendant’s solicitor had sent an email to the plaintiff’s solicitor on 25 October 2019 advising that the pruner was purchased and modified by the fitting of low angled cutters. The interlocutory application was brought on 11 November 2019. Subsequently the defendant’s solicitors filed an affidavit advising that there was nothing special about the pruner. It merely had a factory extension fitted. Counsel for the plaintiff submitted that following the email of 25 October 2019 it was left with an ambiguous position as to what had been done to the pruner. Accepting that submission, the matter rises no higher than a misunderstanding on the part of the plaintiff as to the true position in relation to the modification of the pruner. The plaintiff contends that it was misled by the defendant. For the reasons set out above, I do not accept that submission. The plaintiff could have clarified what the position was before it issued its application. It is apparent that relevant enquiries made earlier would have elicited the information set out in the defendant’s solicitor’s affidavit. Instead, what occurred was the plaintiff brought an application before it fully appreciated the true position. That position was not being concealed by the defendant even if the evidence and information in relation to the nature of the modifications made to the pruner were somewhat exiguous prior to the service of the defendant’s solicitor’s affidavit. In short, the application was premature. The plaintiff should bear its own costs of the application. However, it should not have to pay the defendant’s costs of the application.
It is convenient to deal separately with the costs of the interlocutory application of 15 December 2017 seeking preservation orders. Both parties seek an order for the costs of this application in their favour. The plaintiff submits that it was wholly successful on this application. I do not accept that submission. While the defendant opposed the application, the Court heard argument as to what were the appropriate terms for an order preserving the grapes to be harvested in the 2018 vintage. This culminated in the Court making orders, some of which fell between the submissions made by the parties. Nonetheless, at the time the application was made the trial had adjourned and it was evident that the grapes would be harvested before a judgment would be delivered. At that stage the issue of who owned the grapes was not the subject of an adjudication by the Court. While ultimately the Court resolved that issue in favour of the defendant, it was necessary to make orders preserving the parties’ respective rights in respect of the 2018 vintage pending the delivery of judgment. The defendant did not negotiate with the plaintiff over the terms of the preservation order before the application was heard. It took the position that the grapes belonged to it and it had entered into an agreement for their sale. It proposed to account for the proceeds of sale to the plaintiff in the event that the defendant was unsuccessful in the action. It joined issue at the hearing of the application with the terms of the orders that should be made. The following day the defendant put a counter proposal. That was not accepted by the plaintiff. Judgment on the application was delivered later that day. In the circumstances I consider a just outcome is that the defendant should pay the plaintiff 50 per cent of its costs of and incidental to the application.
I turn to the interlocutory applications of 19 July 2018, 25 July 2018 and 29 August 2018. I will come to the application brought by the defendant to have these applications heard by me rather than Bampton J.
I accept that the plaintiff succeeded on these applications. However, each application was brought after I had given judgment in favour of the defendant on the issues relevant to the ownership of the 2018 vintage. While I was satisfied that the plaintiff was entitled to the relief it sought, in order to protect its position pending the outcome of its appeal to the Full Court and later its application for special leave to appeal to the High Court, the relief granted by the Court was in the nature of an indulgence. The judgment given by me was not provisional. The Court held that the defendant was the owner of the grapes. The applications by the plaintiff were intended to keep the defendant out of the fruits of its judgment. The judgment of the Full Court and the dismissal of the application for special leave vindicated the defendant. However, the defendant unsuccessfully resisted the plaintiff’s legitimate applications to preserve its position pending the outcome of those further proceedings. In the circumstances, I consider it would be unjust for the plaintiff to pay the defendant’s costs of the applications given the plaintiff obtained from the Court the orders it sought. On the other hand, I also consider it would be unjust for the defendant to pay the plaintiff’s costs of the applications given that the defendant held a judgment in its favour when these applications were brought to protect the plaintiff’s position while it pursued an unsuccessful appeal and an unsuccessful application for special leave. In the circumstances, I would make no orders as to the costs of these applications.
Given the approach I have taken to the costs of these applications, I consider that fairness dictates that I should take the same approach to the defendant’s procedural application in relation to the hearing of those applications before Bampton J. I also would make no order as to the costs of that application.
Conclusion
I would order that the plaintiff pay the defendant 80 per cent of its costs of and incidental to the trial on a party/party basis, to be agreed or taxed. I would order that the defendant pay the plaintiff its costs of the application of 25 July 2018 setting aside a creditor’s statutory demand. I would order that the plaintiff pay the defendant its costs of the application to file a third points of claim and a third points of reply and second defence to cross-claim, and its costs thrown away as a consequence of that part of the application that was successful, on a party/party basis to be agreed or taxed. I would order the defendant pay the plaintiff 50 per cent of its costs of the application seeking preservation orders on a party/party basis to be agreed or taxed. I would order the defendant pay the plaintiff’s costs of the application of 8 November 2019 seeking a freezing order on a party/party basis to be agreed or taxed.