Radio Frequency Systems Pty Ltd v Noel Guthrie as the Liquidator of ULT Ltd (Receiver Appointed) (In Liq)

[2001] WASCA 195 (S)

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE FULL COURT (WA)

CITATION : RADIO FREQUENCY SYSTEMS PTY LTD -v- NOEL GUTHRIE as the Liquidator of ULT LTD (Receiver Appointed) (In Liq) [2001] WASCA 195 (S)

CORAM : STEYTLER J

MILLER J

PIDGEON AUJ

HEARD	: 1 JUNE 2001
DELIVERED	: 27 JUNE 2001
SUPPLEMENTARY
DECISION	: 19 OCTOBER 2001
FILE NO/S	:  FUL 116 of 2000
BETWEEN	:  RADIO FREQUENCY SYSTEMS PTY LTD Appellant (Respondent)

AND

NOEL GUTHRIE as the Liquidator of ULT LTD
(Receiver Appointed) (In Liq)

Respondent (Applicant)

Catchwords:

Practice and procedure - Costs - Turns on own facts

Legislation:

Nil

[2001] WASCA 195 (S)

Result:

Costs orders made

Category: B

Representation:

Counsel:

Appellant (Respondent) :	Mr E M Heenan QC
Respondent (Applicant) :	Mr G J O'Hara

Solicitors:

Appellant (Respondent) :	Phillips Fox
Respondent (Applicant) :	Kott Gunning

Case(s) referred to in judgment(s):

Nil

Case(s) also cited:

Nil

[2001] WASCA 195 (S)

JUDGMENT OF THE COURT

1. JUDGMENT OF THE COURT: The appellant, having been successful in its appeal in obtaining orders setting aside the judgment below and substituting for it a judgment that the respondent's claim be dismissed and that there be judgment in favour of the appellant against the respondent, now seeks its costs of the appeal and of the proceedings below. Written submissions have, in that respect, been lodged by each of the appellant and the respondent, both parties having agreed that the matter might be dealt with in that way.

2. So far as the costs of the appeal are concerned, the respondent does not oppose an order that it pay the appellant's costs of the appeal to be taxed. That order should plainly be made. However, because the written submissions do not address the question of a certificate for second counsel, we shall hear oral submissions from the parties in that respect.

3. As to the costs of the proceedings below, the point of dispute is that, while the appellant has now been successful on one of the issues which it raised at trial (that of whether the effect of payments by ULT Ltd ("ULT") to the appellant conferred upon the appellant a preference, priority or advantage), it was unsuccessful on two other issues (whether ULT was solvent at the time and whether the payments were received by the appellant in good faith and in the ordinary course of business) in respect of which there has been no appeal. Both parties recognise that this should result in a reduction in the costs which might otherwise be awarded to the appellant, but they are in dispute as to how this should be dealt with. The appellant contends that the respondent should pay 70 per cent of its costs of the trial and the respondent contends that, while the appellant is entitled to an order for costs in relation to the trial, that order should not extend to the costs of those issues upon which it was unsuccessful and, indeed, the appellant should pay the costs incurred by the respondent in respect of those issues. It also contends that it is entitled to its costs in respect of the appellant's application dated 1 November 1999 to strike out various parts of its affidavits. It says that it should have these costs (which were reserved) because it was substantially successful.

4. It appears from the materials before us that the two issues upon which the appellant was unsuccessful at trial, particularly that relating to the insolvency of ULT at the material time, took up a significant proportion of the trial and also required a considerable amount of work in preparing affidavits and compiling supporting documentation. Against that, the respondent's application against the appellant was such as to require proof of ULT's insolvency at the material time and there is nothing

[2001] WASCA 195 (S)

JUDGMENT OF THE COURT

to suggest that the appellant acted unreasonably, at least initially, in
requiring the respondent to prove that fact.

1. Taking these considerations into account as well as the various matters which have been raised by each of the parties in their respective submissions, it seems to us that the matter is best dealt with by way of a "global" award rather than by ordering a series of individual taxations. We consider that the appellant should, in all of the circumstances, be awarded 50 per cent of its costs of the proceedings, including any reserved costs. This would reflect the various matters to which we have referred, the most important of which was, in our opinion, that the appellant's defence of the claim has ultimately been vindicated.

2. We are also prepared to order, notwithstanding submissions to the contrary on behalf of the respondent, that the costs of the proceedings below be taxed without regard to the limits in Item 21 of the Supreme Court costs scale. This is so because the matters in dispute were, in our opinion, reasonably complex and required consideration of a considerable body of evidence, leaving open the prospect that the limits will prove to be inadequate. It would, of course, still be up to the appellant to persuade the Taxing Officer that its costs were reasonably and necessarily incurred.

3. We consequently propose to order that the respondent is to pay the appellant's costs of the appeal to be taxed and that it should pay 50 per cent of the appellant's costs of the proceedings below, including reserved costs, the costs of those proceedings to be taxed without regard to the limits in Item 21 of the Supreme Court costs scale. We will, as we have foreshadowed, give to the parties an opportunity to raise the issue of a certificate for second counsel.