Rigene Pty Ltd v Rugolo (Costs Ruling No 2) - [2024] VSC 187

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

PROPERTY LIST

S ECI 2023 05968

RIGENE PTY. LIMITED (ACN 005 297 683)	Plaintiff
v
FRANCESCO RUGOLO	First defendant
REGISTRAR OF TITLES	Second defendant

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JUDGE:	Gray J
WHERE HELD:	Melbourne
DATE OF HEARING:	17 April 2024
DATE OF JUDGMENT:	19 April 2024
CASE MAY BE CITED AS:	Rigene Pty Ltd v Rugolo (Costs Ruling No 2)
MEDIUM NEUTRAL CITATION:	[2024] VSC 187

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COSTS — Plaintiff sought order for removal of caveat lodged by defendant pursuant to s 90(3) of the Transfer of Land Act 1958 — Parties consented to orders for removal of caveat and for payment by plaintiff of amount claimed by defendant into separate account pending resolution or determination of dispute about defendant’s entitlement — Consent orders did not dispose of the question of costs — Plaintiff subsequently applied for costs of the proceeding, on an indemnity basis, against defendant — Where plaintiff’s application for costs of the proceeding was dismissed and defendant sought his costs of responding to plaintiff’s failed costs application — Defendant’s application allowed but on the standard basis not indemnity basis.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Ms A Gaber	Gadens
For the First Defendant	Dr D Stamboulakis	MA Legal

HIS HONOUR:

I gave an initial costs ruling in this proceeding on 17 April 2024, supported by oral reasons. In that ruling, I dismissed an application for orders relating to costs of the proceeding brought by the plaintiff against the first defendant.

I now provide a second costs ruling. This ruling determines an application by the first defendant for costs, on an indemnity basis, against the plaintiff in respect of the plaintiff’s failed application the subject of my first costs ruling.

In the course of my oral reasons in support of my first costs ruling, I gave a detailed account of the facts that led to the proceeding. I will not repeat those reasons now. I will refer only to the basic procedural developments in the case.

The plaintiff sought removal pursuant to s 90(3) of the Transfer of Land Act 1958 of a caveat lodged by the first defendant over a property registered to the plaintiff which the plaintiff wished to sell. The caveat arose from a loan agreement that contained a charging clause. The first defendant alleged he was owed over $306,000 and the debt was secured by the charging clause to the property.

The second defendant had no active role in the proceeding and sent a submitting letter to the Court in the usual form.

On 20 December 2023, I made orders by consent disposing of this proceeding save as to costs.

The orders by consent provided for the removal of the caveat and required the plaintiff to pay from the proceeds of sale of the property the amount claimed by the first defendant into a separate interest-bearing account in the name of the plaintiff’s solicitors. Those funds are to be retained until there has…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2024] VSC 187
Decision Date: 19 April 2024

CaseChat Overview and Summary

Rigene Pty Ltd sought the removal of a caveat lodged by Rugolo, pursuant to section 90(3) of the Transfer of Land Act 1958. Both parties agreed to orders for the removal of the caveat and for the plaintiff to pay the amount claimed by the defendant into a separate account, pending resolution of the dispute over the defendant’s entitlement. The consent orders did not address the issue of costs. The plaintiff later applied for the costs of the proceeding, on an indemnity basis, against the defendant. This application was dismissed. The defendant subsequently sought his costs of responding to the plaintiff’s unsuccessful costs application.

The primary legal issue before the court was whether the defendant’s application for costs, in response to the plaintiff’s failed application for costs, should be granted on an indemnity basis or the standard basis. The court held that the defendant was entitled to an order for costs on the standard basis, rather than the indemnity basis sought. The court found that the plaintiff’s application for costs was not entirely without merit, as it was not frivolous or vexatious, and therefore did not warrant indemnity costs. Instead, the court granted the defendant’s costs on the standard basis.

In reaching its decision, the court considered the nature of the plaintiff’s application for costs and the circumstances in which it was made. The court held that the plaintiff’s application was not so lacking in merit as to warrant indemnity costs, and that the standard basis was appropriate in the circumstances. The court also noted that the plaintiff’s application for costs was not entirely without merit, as it was not frivolous or vexatious. The court emphasised that indemnity costs should only be awarded in exceptional circumstances, where the application for costs was completely without merit.

The court ordered that the defendant was entitled to his costs of responding to the plaintiff’s failed application for costs, on the standard basis. The court did not make any order as to the costs of the original proceeding or the costs of the defendant’s application for costs. The court held that the defendant was entitled to his costs on the standard basis, rather than the indemnity basis sought, and that the plaintiff’s application for costs was not so lacking in merit as to warrant indemnity costs.

Orders