FEDERAL COURT OF AUSTRALIA
Pleash (Liquidator) v Tucker (No 2) [2018] FCAFC 168
Appeal from: Pleash, in the matter of Equititrust Limited (In Liquidation) (Receivers and Managers Appointed) (No 3) [2017] FCA 1074 File number: QUD 2 of 2018 Judges: MCKERRACHER, FARRELL AND BANKS-SMITH JJ Date of judgment: 5 October 2018 Catchwords: COSTS - where indemnity costs sought - where leave to appeal granted but appeal dismissed - whether rejection of offers unreasonable Legislation: Federal Court Rules 2011 (Cth) rr 20.31, 25 Cases cited: Calderbank v Calderbank [1975] 3 All ER 333
Pleash (Liquidator) v Tucker [2018] FCAFC 144
Visscher v Teekay Shipping (Australia) Pty Ltd (No 5) [2013] FCA 28
Date of hearing: Determined on the papers Date of last submissions: 6 September 2018 (Appellant)
5 and 12 September 2018 (Respondents)Registry: Queensland Division: General Division National Practice Area: Commercial and Corporations Sub-area: Corporations and Corporate Insolvency Category: Catchwords Number of paragraphs: 34 Counsel for the Appellant: Mr SC Russell Solicitor for the Appellant: Russells Counsel for the Respondents: Mr P Hackett Solicitor for the Respondents: Tucker & Cowen Solicitors ORDERS
QUD 2 of 2018 BETWEEN: BLAIR ALEXANDER PLEASH AND RICHARD ALBARRAN AS LIQUIDATORS OF EQUITITRUST LTD (IN LIQ) (RECEIVERS AND MANAGERS APPOINTED) (ACN 061 383 944)
Appellant
AND: DAVID ROBERT WALTER TUCKER
First Respondent
VIKWOOD PTY LTD
Second Respondent
TUCKER FINANCE PTY LTD (and others named in the Schedule)
Third Respondent
JUDGES:
MCKERRACHER, FARRELL AND BANKS-SMITH JJ
DATE OF ORDER:
5 OCTOBER 2018
THE COURT ORDERS THAT:
1.The respondents are to bear their own costs of the affidavits removed from the Court record in accordance with the orders of the Court made 9 May 2018 and of the affidavits filed by the respondents dated 16 May 2018.
2.Subject to order 1, the appellant (Liquidators) pay the respondents' costs of the application for leave to appeal, the appeal and the interlocutory application filed 25 May 2018 on a party and party basis.
3.Subject to order 1, the Liquidators pay the respondents' costs of the Production Application:
(a)before 11.00 am on 26 April 2018 on a party and party basis;
(b)after 11.00 am on 26 April 2018 on an indemnity basis.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
THE COURT:
On 29 August 2018 we granted leave to appeal but dismissed the appeal, and also dismissed an application for production of documents: Pleash (Liquidator) v Tucker [2018] FCAFC 144. At the time that judgment was given the respondents indicated that they wished to seek costs on an indemnity basis, and an order was therefore made that the parties file submissions, with the question of costs to be determined on the papers.
Put generally, the parties made submissions as to the costs of the application for leave to appeal, the appeal itself and an application for production of documents.
It is necessary to set out some of the relevant events.
On 3 January 2018 the appellant (Liquidators)…
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- Case
- [2018] FCAFC 168
- Decision Date
CaseChat Overview and Summary
The primary legal issue the court had to address was whether the liquidators' rejection of offers made by Tucker during the litigation process was unreasonable, thereby justifying an award of indemnity costs. The liquidators argued that their refusal to accept the offers was justified given the circumstances, and they should be awarded indemnity costs for the appeal and related proceedings. Conversely, Tucker contended that the rejection of the offers was unreasonable and that the liquidators should bear their own costs.
The court found that the liquidators' refusal to accept Tucker's offers was not unreasonable, given the context and the potential implications of accepting the offers. The court held that the liquidators' decision was made in good faith and with a reasonable basis. Consequently, the liquidators were not entitled to indemnity costs for the appeal and related proceedings. However, the court ordered that the liquidators were to bear their own costs for specific affidavits and the interlocutory application filed by Tucker. For other costs associated with the proceedings, the court ordered that the liquidators pay Tucker's costs on a party and party basis, except for the costs incurred after a certain time on a particular date, which were to be paid on an indemnity basis.
The final orders required the liquidators to bear certain specified costs, while Tucker was to bear the costs of other proceedings on a party and party basis. The liquidators were also ordered to pay Tucker's costs after a particular time on a specified date on an indemnity basis. This decision underscores the importance of the reasonableness of rejecting settlement offers in determining the allocation of costs in litigation.
Orders
Orders of the court
1. The respondents are to bear their own costs of the affidavits removed from the Court record in accordance with the orders of the Court made 9 May 2018 and of the affidavits filed by the respondents dated 16 May 2018.
2. Subject to order 1, the appellant (Liquidators) pay the respondents' costs of the application for leave to appeal, the appeal and the interlocutory application filed 25 May 2018 on a party and party basis.
3. Subject to order 1, the Liquidators pay the respondents' costs of the Production Application:
(a) before 11.00 am on 26 April 2018 on a party and party basis;
(b) after 11.00 am on 26 April 2018 on an indemnity basis.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
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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