Re Biondo (No 2)
[2024] VSC 132
•25 March 2024
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
S CI 2022 04757
| SALVATORE BIONDO | First Plaintiff |
| -and- | |
| ROSA BIONDO | Second Plaintiff |
| v | |
| NILLA BIONDO (who is sued as Executor of the Estate of ATTILIO BIONDO, deceased) | Defendant |
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JUDGE: | Moore J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | Written submissions |
DATE OF JUDGMENT: | 25 March 2024 |
CASE MAY BE CITED AS: | Re Biondo (No 2) |
MEDIUM NEUTRAL CITATION: | [2024] VSC 132 |
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COSTS – Estate litigation – Where plaintiffs successful in establishing standing – Where plaintiffs did not advance a case which they had standing to bring until certain date – Where defendant rejected plaintiffs’ settlement offer – Where proceeding settled on terms less advantageous to defendant than plaintiffs’ settlement offer – Apportionment of costs – Order 63 of the Supreme Court (General Civil Procedure) Rules 2015 – Northern Territory v Sangare (2019) 265 CLR 164, 173.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiffs | Mr G Moloney | Sutherland Lawyers |
| For the Defendant | Mr J.D. Catlin | Borchard & Moore |
HIS HONOUR:
Background
This judgment is in respect of the costs of a proceeding which has otherwise been resolved by agreement.
The subject matter of the proceeding was one which was particularly unsuited to adjudication by the courts: a claim by the plaintiffs,[1] who are the parents of the deceased, for orders that the defendant, being the deceased’s wife and executor of his estate, arrange the deceased’s final burial in a crypt to be purchased by his estate, and for the exhumation of his remains from their present place of interment, and for them to be reinterred in a crypt to be purchased by the estate.
[1]Originally there were two other plaintiffs to the proceeding, being the children of the current plaintiffs, Sandro Biondo and Sebastiana Venditti (the third and fourth plaintiffs). They were removed as parties on 15 June 2023.
The only substantive issue in the proceeding which the Court determined was the plaintiffs’ standing. That issue, and the relevant history of the proceeding, arose in the following way.
The Court listed for hearing, on its own motion, the question of the plaintiffs’ standing to maintain their claims, on 1 June 2023. On that day the plaintiffs, having recently obtained legal representation, sought an adjournment and leave to file a proposed further amended originating motion. I acceded to those requests and a proposed further amended originating motion was filed on 8 June 2023 (the proposed further amended originating motion) and the hearing as to the plaintiffs’ standing was adjourned to 15 June 2023. The plaintiffs were ordered to pay the defendant’s costs thrown away by reason of the adjournment.
The hearing on standing proceeded on 15 June 2023 by reference to the proposed further amended originating motion. On 27 June 2023, I published my reasons for judgment in which I held that the plaintiffs had established standing to maintain the proceeding.[2] The plaintiffs were granted leave to file and serve a further amended originating motion in the form which had previously been provided. The proceeding was listed for trial on a date to be fixed.
[2]Re Biondo [2023] VSC 357 (the reasons for judgment).
On 9 August 2023 orders were made listing the proceeding for hearing on 14 September 2023 and reserving the costs of and incidental to the hearings on standing on 1 June and 15 June 2023. As to the latter matters, the orders of the Court narrated that:
[i]n the exercise of its discretion in respect of costs, the Court has determined that, although the plaintiffs succeeded on the issue of standing, it is appropriate for costs to be reserved as the question of standing was raised by the Court, not by the defendant.
On 13 September 2023, the day before the trial of the proceeding, the Court made orders by consent dismissing the proceeding save as to costs. The parties executed terms of settlement which provided for the resolution of the proceeding on or about the same date.
The plaintiffs seek their costs of the determination of the standing issue, along with other costs of the proceeding on a standard basis. They seek that these costs be set off against the costs order made on 1 June 2023 in the defendant’s favour. As they were not legally represented until 18 May 2023, the plaintiffs do not seek a costs order for steps taken when they were self-represented.
The defendant submitted that she should have her costs of ‘the first stage of the proceeding based on flawed pleadings and standing’ and ‘the costs of the proceeding regularising the proceeding’.
Regrettably, this judgment in respect of costs has been unduly delayed as a result of administrative oversight in the case-management processes of the Court.
Principles and submissions
The Court has a general discretion in respect of costs, including in relation to the administration of estates and trusts. The discretion is to be exercised judicially and in accordance with Order 63 of the Supreme Court (General Civil Procedure) Rules 2015.
The usual rule as to costs is that a successful party to litigation is entitled to an award of costs in its favour, with the unsuccessful party bearing the liability for the costs of the unsuccessful litigation. In Northern Territory v Sangare, the High Court stated that:[3]
A guiding principle by reference to which the discretion is to be exercised – indeed, “one of the most, if not the most, important” principle – is that the successful party is generally entitled to his or her costs by way of indemnity against the expense of litigation that should not, in justice, have been visited upon that party. The application of that principle may be modified or displaced where there is conduct on the part of the successful party in relation to the conduct of the litigation that would justify a different outcome. ...
[3](2019) 265 CLR 164, 173 [25], omitting citations.
In respect of the costs associated with the determination of the standing issue, the plaintiffs submitted that there was no reason to depart from the usual rule that costs should follow the event. The defendant was wholly unsuccessful. Her central argument was based entirely on the proper scope of Order 54 of the Supreme Court (General Civil Procedure) Rules, an argument which the Court was an ‘unduly narrow construction of Order 54’.[4]
[4]Reasons for judgment [13].
The plaintiffs conceded that neither the third nor fourth plaintiff had standing and orders were made to remove them as parties to the proceeding by consent on 15 June 2023. However, they submitted that the involvement of the third and fourth plaintiffs prior to their removal did not add to, or otherwise increase, the plaintiffs’ costs of defending the application on standing and that the defendant incurred no additional costs by reason of them being named as plaintiffs.
In respect of the costs of the substantive proceeding, the plaintiffs submitted that it was necessary to commence and prosecute the proceeding because of the ‘recalcitrance and delay occasioned by the defendant in making the necessary arrangements for the final resting place’ of the deceased. The delay occasioned was said to be some three-and-a-half years, during which the defendant was unresponsive to repeated requests made by the plaintiffs to make said arrangements, notwithstanding the fact that the defendant was legally represented at this time.
The plaintiffs further submitted that the defendant should pay their costs of the proceeding on the basis of the defendant having refused an offer of settlement made at the hearing on 1 June 2023, and reiterated by way of letter on 7 June 2023 (the plaintiffs’ offer). The plaintiffs contend that the terms of the settlement subsequently entered into by the parties were substantially more disadvantageous to the defendant than the plaintiffs’ offer.
The defendant submitted that the plaintiffs brought an ‘irregular proceeding inflicting unnecessary costs on the defendant’. The irregularity was said to be the plaintiffs’ ‘flawed’ originating motion dated 18 November 2022 and a ‘flawed’ amended originating motion dated 17 December 2022. The flaw was said to be threefold:
(a) the plaintiffs lacked standing for relief based on the Administration and Probate Act 1958, as the plaintiffs were not beneficiaries of the estate and had no standing qua the executor/trustee;
(b) the plaintiffs sought orders under a power that did not exist (namely, they broadly sought orders under the Administration and Probate Act 1958 and failed to cite a specific provision); and
(c) the subject matter was a private agreement amenable to the seeking of relief in the nature of specific performance or a declaration in the Magistrates’ Court.
These flaws were said by the defendant to generate wasted appearances on 9 December 2022, 17 February 2022, 31 March 2023 and 1 June 2023.
The defendant further emphasised that it was the Court who raised the issue of standing on 17 February 2023.
The defendant then referred to the reasons for judgment and the reference therein to Leeburn v Derndorfer.[5] The defendant submitted that it did not follow that the relief sought by the plaintiffs pursuant to the Administration and Probate Act 1958 was competent as it did not appear to have been sought in Leeburn.
[5](2004) 14 VR 100 discussed in the reasons for judgment at [18].
The defendant referred to the plaintiffs’ offer and noted that it was made in ‘the context of the substantially revamped pleadings still only being in prospect’. The defendant did not contest the plaintiffs’ submission that the terms of the settlement agreement were substantially more disadvantageous to the defendant than the plaintiffs’ offer.
Appearing to address the plaintiffs’ submissions on the reasonableness of bringing the proceeding, the defendant noted that the evidence relied upon by the plaintiffs on this point was not led and that ‘where [the plaintiffs] were to be interred was an unresolved issue’.
The defendant submitted that the consideration of the pleadings was moved by the Court, but that the ‘failure of standing and pleadings’ remained that of the plaintiffs.
Determination
In my assessment there are three key features of this proceeding which guide the exercise of the Court’s discretion in respect of costs.
First, it was not until 8 June 2023, being the date when the plaintiffs filed the proposed further amended originating motion, that the plaintiffs formulated a case against the defendant which they had standing to bring. Until that time, the defendant was unreasonably required to incur costs in defending a proceeding which was not properly formulated. The defendant should therefore get her costs of the proceeding before 8 June 2023.
Secondly, the plaintiffs were wholly successful in relation to the hearing on standing,[6] being the entirety of the controversy which was dealt with by the Court.
[6]Which, as I have noted above, proceeded on 15 June 2023 after the plaintiffs sought an adjournment at the hearing on 1 June 2023.
Thirdly, the defendant ultimately agreed to terms of settlement which were less advantageous to her than those which were offered by the plaintiffs in June 2023. The substantive result of the plaintiffs’ June 2023 offer and the terms of settlement is the same: the deceased is to be exhumed and reinterred in an alternative crypt. However, where the plaintiffs had previously offered to cover the expenses making these arrangements, the defendant is now responsible for the cost.
Pursuant to the plaintiffs’ June 2023 offer, the plaintiffs agreed to pay all costs associated with the applying for an exhumation licence for removal of the deceased’s remains, the exhumation of the deceased’s remains and the costs of the reinterment. However, pursuant to the terms of settlement, the defendant is solely liable for all of these expenses.
By reason of the second and third points to which I have referred above, the plaintiffs should receive their costs of the proceeding on and after 8 June 2023, including costs in connection with the hearing on standing.
The Court will accordingly order as follows:
1. The plaintiffs pay the defendant’s costs of the proceeding in respect of the period before 8 June 2023 on a standard basis to be taxed in default of agreement.
2. The defendant pay the plaintiffs’ costs of the proceeding on and after 8 June 2023, including costs of and incidental to the hearing on standing on 15 June 2023, on a standard basis to be taxed in default of agreement.
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