JUDGMENT OF THE COURT: On 14 February 2001 the Court delivered judgment in Re Malley SM, Ex Parte Gardner[2001] WASCA 29 the respondent now seeks a special costs order that the applicant pay its cost to be taxed on an indemnity basis, save to the extent that they are unreasonable in amount or that they were unreasonably incurred.
A special costs order of this nature will only be made in exceptional circumstances; Colgate Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225: The conclusion reached by the majority of the Court that these proceedings constituted an abuse of process is capable of constituting special circumstances in the relevant sense and provides a sufficient foundation on which costs could be ordered on an indemnity basis; Bailleu Knight Frank NSW Pty Ltd v Ted Maning Real Estate Pty Ltd (1992) 30 NSWLR 389.
As the reasons for decision of this Court reveal, however, this was not a case where the applicant, properly advised, should have known his case was manifestly unarguable with no chance of success; Re Fountain Selected Meats (1988) 81 ALR 397 at 401; Quancorp Pty Ltd v MacDonald[1999] WASCA 101 at [4] and [7]. In this respect it is to be noted that there was some difference of view among the members of this Court and that another Judge of the Court was persuaded to grant an Order Nisi to the applicant.
In these circumstances we are not persuaded that a special order is appropriate.
The applicant should pay the respondent's costs to be taxed with a certificate for second counsel.
Details
AGLC
Re Malley SM; Ex parte Gardner [2001] WASCA 83
Case
[2001] WASCA 83
Decision Date
CaseChat Overview and Summary
The case of Re Malley SM; Ex parte Gardner involved a request for a special costs order by the respondent against the applicant. The matter was brought before the court following the delivery of judgment on 14 February 2001, where the court found the proceedings to be an abuse of process. The respondent sought an order that the applicant pay their costs on an indemnity basis, except where they were deemed unreasonable. The applicant argued against the imposition of such costs, citing the absence of exceptional circumstances warranting such an order.
The legal issues before the court centred on whether the circumstances of the case were exceptional enough to justify the imposition of costs on an indemnity basis. The court considered precedents such as Colgate Palmolive Company v Cussons Pty Ltd and Baillieu Knight Frank NSW Pty Ltd v Ted Maning Real Estate Pty Ltd, which indicated that such costs could be awarded in cases of abuse of process. However, the court also noted the necessity for the applicant to have a clear understanding that their case was without merit, as established in cases like Re Fountain Selected Meats and Quancorp Pty Ltd v MacDonald.
The court found that while the proceedings were indeed an abuse of process, the applicant had not acted in a manner that should have been known to be manifestly unarguable. The existence of differing opinions among the judges further complicated the matter, with one judge even granting an Order Nisi to the applicant. Consequently, the court concluded that the circumstances did not meet the exceptional criteria required for an indemnity costs order. Instead, the applicant was ordered to pay the respondent's costs to be taxed, with a certificate for second counsel.
This decision highlights the stringent criteria required for awarding indemnity costs and the importance of a clear demonstration of abuse of process by the applicant. The court's decision not to impose indemnity costs was based on the lack of exceptional circumstances and the presence of differing judicial opinions.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
OWEN J
JUDGMENT OF THE COURT: On 14 February 2001 the Court delivered judgment in Re Malley SM, Ex Parte Gardner [2001] WASCA 29 the respondent now seeks a special costs order that the applicant pay its cost to be taxed on an indemnity basis, save to the extent that they are unreasonable in amount or that they were unreasonably incurred. A special costs order of this nature will only be made in exceptional circumstances; Colgate Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225: The conclusion reached by the majority of the Court that these proceedings constituted an abuse of process is capable of constituting special circumstances in the relevant sense and provides a sufficient foundation on which costs could be ordered on an indemnity basis; Bailleu Knight Frank NSW Pty Ltd v Ted Maning Real Estate Pty Ltd (1992) 30 NSWLR 389. As the reasons for decision of this Court reveal, however, this was not a case where the applicant, properly advised, should have known his case was manifestly unarguable with no chance of success; Re Fountain Selected Meats (1988) 81 ALR 397 at 401; Quancorp Pty Ltd v MacDonald [1999] WASCA 101 at [4] and [7]. In this respect it is to be noted that there was some difference of view among the members of this Court and that another Judge of the Court was persuaded to grant an Order Nisi to the applicant. In these circumstances we are not persuaded that a special order is appropriate. The applicant should pay the respondent's costs to be taxed with a certificate for second counsel.