Riemann & Riemann (No 2)

The Full Court of the Supreme Court of New South Wales, constituted by McClelland J, considered an application by the respondent, Riemann, for an order that the applicant, also named Riemann, pay the respondent's costs of an earlier proceeding. The dispute concerned the respondent's entitlement to costs following the dismissal of the applicant's claim for an account of profits and an injunction.

The primary legal issue before the Court was whether the applicant's conduct in initiating and pursuing the earlier proceeding warranted an order for the applicant to pay the respondent's costs, notwithstanding the general rule that costs follow the event. Specifically, the Court had to determine if the applicant's actions constituted an abuse of process or vexatious conduct that justified a departure from the usual costs order.

McClelland J reasoned that the applicant's claim was entirely without merit and had been pursued in a manner that was oppressive and vexatious. His Honour found that the applicant had persisted with the litigation despite clear indications that the claim was unsustainable, thereby causing significant and unnecessary expense to the respondent. The Court applied the principle that where a party's conduct in litigation is found to be an abuse of process, the court has the discretion to depart from the ordinary rule regarding costs and to order that party to pay the costs of the other party.

The Court ordered that the applicant pay the respondent's costs of the earlier proceeding, including the costs of the application for costs.