Plaza West Pty Ltd v Simon's Holdings (NSW) Pty Ltd (No 2)

[2011] NSWSC 556

Supreme Court

New South Wales

Medium Neutral Citation:	Plaza West Pty Ltd v Simon's Holdings (NSW) Pty Ltd (No 2) [2011] NSWSC 556
Decision date:	10 June 2011
Jurisdiction:	Equity Division
Before:	Gzell J
Decision:	No order for immediate payment of costs.
Catchwords:	PROCEDURE - Costs - whether should be paid forthwith - Uniform Civil Procedure Rules 2005, Pt 42 r 42.7
Legislation Cited:	Uniform Civil Procedure Rules 2005 Supreme Court Rules 1970 Practice Note SC Eq 3 Industrial Relations Act 1996
Cases Cited:	Plaza West Pty Ltd v Simon's Holdings (NSW) Pty Ltd [2011] NSWSC 263 Fiduciary Ltd v Morningstar Research Pty Ltd [2002] NSWSC 432; (2002) 55 NSWLR 1 Traderight (NSW) Pty Ltd & Ors v Bank of Queensland Ltd (No 2) [2008] NSWSC 589 Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; (1981) 147 CLR 589
Category:	Costs
Parties:	Plaza West Pty Ltd (Plaintiff) Simon's Holdings (NSW) Pty Ltd (First Defendant) Simon Emerzidis (Second Defendant) Georgia Emerzidis (Third Defendant)
Representation:	Counsel M Rudge SC/M Hall (Plaintiff) B Walker SC/K Andronos (First and Third Defendants Solicitors Adrian Batterby (Plaintiff) Paul Bard Lawyers (First and Third Defendants
File Number(s):	2010/289587

Judgment

1. In Plaza West Pty Ltd v Simon's Holdings (NSW) Pty Ltd [2011] NSWSC 263 the Defendants' notice of motion to dismiss the Plaintiff's claim or permanently stay it was dismissed with costs. The Plaintiff has applied for an order that the costs be payable forthwith under the Uniform Civil Procedure Rules 2005, Pt 42 r 42.7.

1. The parties have produced written submissions and have asked that I decide the question on the papers.

1. Pt 42 r 42.7 is in the following terms:

"(1) Unless the court orders otherwise, the costs of any application or other step in any proceedings, including:

(a)   costs that are reserved, and

(b)   costs in respect of any such application or step in respect of which no order as to costs is made,

are to be paid and otherwise dealt with in the same way as the general costs of the proceedings.

(2) Unless the court orders otherwise, costs referred to in subrule (1) do not become payable until the conclusion of the proceedings."

1. The forerunner of this provision was the Supreme Court Rules 1970, Pt 52A, r 9. It relevantly provided:

"(1) Where before the conclusion of any proceedings, other than proceedings entered in the Commercial List or the Technology and Construction List, the Court makes an order for the payment of costs or a motion is refused with costs, the costs shall not, unless the Court otherwise orders, be payable until the conclusion of the proceedings.

....

(3) Where in any proceedings:

(a) it appears to the Court that:

(i)   a party has been subject to unreasonable delay or default on the part of any other party;

(ii)   the proceedings are unreasonably protracted; or

(iii)   justice otherwise demands it; or

(b) a costs order is made under r 43 or r 43A,

the Court may order that costs, or a specified amount on account of cost, be payable forthwith."

1. The purpose of both rules was to prevent applications for assessment of costs each time there was a disposal of an interlocutory application.

1. The exception of matters in the Commercial List and the Technology and Construction List in the former rule is mirrored in Practice Note SC Eq 3 at [57]:

"Unless otherwise ordered, a party in whose favour an order for costs is made may proceed to assessment of such costs forthwith."

1. It was submitted that the proceedings are commercial in nature and a similar presumption in favour of immediate assessment should arise.

1. The simple answer is that the proceedings are not in the Commercial List.

1. In Fiduciary Ltd v Morningstar Research Pty Ltd [2002] NSWSC 432; (2002) 55 NSWLR 1 at [11] - [13]; 4 - 5 Barrett J identified three categories of case in which the discretion to allow an immediate payment of costs had been made under the former rule:

(a) W here the application or aspect in respect of which the particular costs order is made before conclusion of the proceedings represents the determination of a separately identifiable matter or may be viewed as the completion of a discrete aspect.

(b) Where there is some unreasonable conduct on the part of the party against whom costs have been ordered.

(c) Where there is much to come in the proceedings and one can see a fairly long time before disposal of the proceedings.

1. I see no reason why these categories should not be considered under the present rule. But the categories are not exhaustive. The court has a general discretion to order the immediate payment of costs.

1. It was submitted on behalf of the Defendants that the pre-eminent factor was unreasonableness of the conduct of the unsuccessful party. But Palmer J in Traderight (NSW) Pty Ltd & Ors v Bank of Queensland Ltd (No 2) [2008] NSWSC 589 ordered the Defendant to pay the Plaintiffs' costs of an unsuccessful application to strike out an amended statement of claim, to be assessed forthwith, in the absence of unreasonableness on the Defendant's part.

1. That decision suggests a fourth category where there is disparity between the parties' ability to bear ongoing costs. At [8] his Honour said:

"I do not think it could reasonably be gainsaid that the Bank would be in a better position than the Plaintiffs to bear the ongoing costs of the that litigation until its conclusion. I see no reason why the costs burdens on the Plaintiffs should be increased by withholding payment of costs to which they are entitled, possibly for a very long time indeed."

1. But I prefer not to categorise the circumstances in which the discretion may be exercised. In my view, it must depend upon all the circumstances of the case before the court.

1. Here, there is no submission of disparity between the parties in their ability to bear orders for costs.

1. There was a discrete issue in Traderight , where the Defendant's motion was to strike out only those parts of the Plaintiffs' amended statement of claim that pleaded a claim founded on the Industrial Relations Act 1996, s 106.

1. Here the application was to strike out the entirety of the pleading on two bases.

1. The Plaintiff had succeeded against different Defendants in fraud. The current proceedings are against the recipients of the fraudulent funds in constructive trust.

1. It was argued that the principle in Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; (1981) 147 CLR 589 prevented the current proceedings.

1. Secondly, it was argued that the Plaintiff had made an election when it sued in fraud and it could not bring the constructive trust proceedings.

1. Further, it has not been submitted that the Defendants were unreasonable in bringing the strike out application.

1. I do not regard the prospects of resolution of the proceedings being so far off that the Plaintiff should have its costs.

1. The Plaintiff's further amended summons and amended list statement were filed on 16 May 2011. The Plaintiff cannot propound its own delay as a basis for the immediate assessment of costs.

There will be no order that the costs be payable forthwith.

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Decision last updated: 10 June 2011