Protec Pacific Pty Ltd v Steuler Industriewerke GmbH

[2007] VSC 328

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION
BUILDING CASES LIST

No. 7268  of 2007

PROTEC PACIFIC PTY LTD	Plaintiff
(ACN 009 534 552)
v
STEULER INDUSTRIEWERKE GmbH	Defendant
(ACN 083 733 966)

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JUDGE:	HABERSBERGER J
WHERE HELD:	MELBOURNE
DATE OF HEARING:	AUGUST 2007
DATE OF RULING:	31 AUGUST 2007
CASE MAY BE CITED AS:	PROTEC PACIFIC PTY LTD v STEULER INDUSTRIEWERKE GmbH
MEDIUM NEUTRAL CITATION:	[2007] VSC 328

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr P Riordan SC with Mr I Percy	Middletons
For the Defendant	Mr P Cosgrave SC with Mr F Tiernan	Anderson Rice

HIS HONOUR:

1. In this matter I gave judgment today dismissing the defendant's application for summary judgment.  Mr Riordan, of senior counsel, who appears with Mr Percy, of counsel, for the plaintiff, has sought an order for costs, and an order that those costs be paid by the defendant on an indemnity basis. 

1. Mr Tiernan, of counsel, who appears for the defendant, has submitted that the appropriate order would be that the costs be in the cause, alternatively, if that were not successful, that the costs should be ordered to be paid on the normal party and party basis, rather than on an indemnity basis. 

1. The application for indemnity costs was put by Mr Riordan on two bases.  First, he submitted that this application for summary judgment was hopeless and was always doomed to failure because there was a clear factual issue that could not be decided on a summary application and required that the matter go to trial.  Secondly, it was submitted that a similar application in an earlier proceeding by the plaintiff against this defendant had been dismissed by Justice Hansen. 

1. Without in any way commenting on what the final conclusion on the contractual question may be, it seems to me that the defendant should have recognised that there was a factual dispute about whether it was the plaintiff or another Protec company, Protec Pacific (NSW) Pty Ltd (“Protec NSW”) which had entered into the relevant contract with WMC (Olympic Dam Corporation) Pty Ltd.  The defendant’s argument that it was not the plaintiff was made in face of the fact that the written document constituting the contract bore the name of the plaintiff, Protec Pacific Pty Ltd, albeit the ACN number given was that of Protec NSW.  As I set out in my reasons for judgment, there were other factual matters that may or may not, in the end, support the argument that it was, in fact, Protec Pacific and not Protec NSW that was the contracting party.  In those circumstances it seems to me that Stueler's advisers should have recognised that the inevitable result of any application such as this was that it would fail because the court could not decide, on a summary application, a factual dispute such as I have outlined. 

1. Mr Tiernan submitted that it was an appropriate application because of the fact this was a proceeding which had been issued late and that it was sought that this proceeding be heard with another proceeding, which had been continuing for some seven years now, in a hearing set to commence in April 2008.  Mr Tiernan submitted that in those  circumstances, where there was a lot of work that would have to be done to prepare this second proceeding for that hearing, it was appropriate to try to avoid that burden by bringing the summary judgment application. 

1. In my view, for the reasons I have outlined, it was not.  Moreover, it seems to me that where there is a pressure of a large amount of work to be done, the parties have been unnecessarily distracted by the bringing and defending of this application. 

1. In those circumstances, it does seem to me that this case falls within one of the recognised categories of indemnity costs, namely that the defendant and its advisers should have known that the application had no chance of success and was therefore vexatious.[1]  I consider, therefore, that the plaintiff is entitled to an order for indemnity costs. 

   [1]Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397, 401 (Woodward J); Colgate Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225, 233 (Sheppard J).

1. I have not, in reaching that conclusion, dealt with the second limb of Mr Riordan's argument, that of the previous finding of Justice Hansen.  In my reasons I did, without analysing the argument in any detail, indicate that His Honour's findings seemed to me to be a further argument why the defendant's application should fail.  Accordingly, this may well have been a second ground for an order for indemnity costs. 

1. I will order that the defendant pay the plaintiff's costs of and incidental to the defendant's summons filed 15 August 2007, such costs to be taxed on an indemnity basis. 

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