Rigging West Pty Ltd v Stanick Pty Ltd - [2013] WASC 185

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL

CITATION: RIGGING WEST PTY LTD -v- STANICK PTY LTD [2013] WASC 185

CORAM: KENNETH MARTIN J

HEARD: 1 MARCH 2013

DELIVERED : 22 MAY 2013

FILE NO/S: CIV 1666 of 2010

BETWEEN: RIGGING WEST PTY LTD
Plaintiff
AND
STANICK PTY LTD
Defendant
HUTGOOD PTY LTD
Third Party

Catchwords:

Costs - Indemnity Orders - Plaintiff seeking to force acquisition of small portion of its encroached land - Adjacent lots - Small spill over and footing encroachment from one lot to other - Subsequent excisement and removal of all intruding portions of footings - Compulsory purchase of plaintiff's property not proceeded with - Partial resolution only - Application for costs - Indemnity costs

Legislation:

Property Law Act 1969 (WA), s 122, s 123
Rules of the Supreme Court 1971 (WA), O 23

Result:

Costs orders favouring the defendant

Category: B

Representation:

Counsel:

Plaintiff:     Ms C H Thompson
Defendant:     Mr M J McPhee
Third Party                   :     No appearance

Solicitors:

Plaintiff:     Benz Legal
Defendant:     M J McPhee Barrister and Solicitor
Third Party                   :     Young & Young

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

Ford Motor Co of Australia Ltd v Lo Presti [2009] WASCA 115
Garwolin Nominees Pty Ltd v Statewide Building Society (1984) VR 469
Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 622
Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129(S)
Walter v Buckridge [No 4] [2011] WASC 313

KENNETH MARTIN J:

This application concerns only the legal costs of the action. The plaintiff and the defendant both asked for indemnity costs against the other. If needed, the defendant would seek to be indemnified against any ultimate costs exposure to the plaintiff by flow‑through costs orders against the third party.
In his oral submissions counsel for the defendant said:
I haven't put any schedule of costs in for my client. I've taken it to be that that's a matter for the taxing master but they're not on the Supreme Court scale, and they'd be substantial.
In those circumstances, it has not been established that an award of taxed costs, to the defendant on the scale, would provide inadequate compensation, if the defendant established an entitlement to costs: see Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129(S) [3].
The parties are agreed the plaintiff's action should be dismissed. Everyone is also agreed that the defendant's action against the third party, ought be dismissed. But the rival positions over costs issues are live and hotly contested.
The third party did not participate in costs arguments, which (regrettably) spanned almost all of Friday 1 March 2013 (about 50% of the time allocated for the whole trial, had it run).

Factual background

Lying at the heart of the proceedings is a boundary traversal infringement dispute, between two neighbours over the footings for a building. The plaintiff is the owner of Lot 219 on Halifax Drive, in an area that appears to be an industrial or light…

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.

Continue reading Rigging West Pty Ltd v Stanick Pty Ltd

Details

AGLC: Rigging West Pty Ltd v Stanick Pty Ltd [2013] WASC 185
Case: [2013] WASC 185
Decision Date: 22 MAY 2013

CaseChat Overview and Summary

The case of Rigging West Pty Ltd v Stanick Pty Ltd involved a dispute over a small encroachment of concrete footings from one property to another, leading to a legal battle over costs and indemnity. The plaintiff, Rigging West, sought to force the acquisition of a small portion of its encroached land by the defendant, Stanick Pty Ltd, and claimed damages for the encroachment. The defendant denied liability and counterclaimed for costs. The case reached a partial resolution before trial, with a third party agreeing to remove the encroachments at their expense, but no final determination was made. Both parties sought indemnity costs orders from the court.

The legal issues before the court included the determination of whether the plaintiff was entitled to indemnity costs and whether the defendant should bear the plaintiff's costs. The court had to consider the nature of the dispute, the conduct of the parties, and whether there had been a final determination of the dispute. The court also had to assess the reasonableness of the plaintiff's claims and whether there were any grounds for awarding indemnity costs.

The court found that there was no final determination of the dispute, as only a partial resolution had been reached, and the third party had agreed to remove the encroachments. The court held that the plaintiff should not receive its costs and must instead bear the defendant's taxed legal costs of the action. The court reasoned that the plaintiff had significantly altered its position over time, initially seeking compulsory acquisition relief, which it later abandoned. The court found that the plaintiff's conduct was disproportionate to the underlying issue and that the defendant had articulated a reasonable position from early on. The court also noted that the third party had effectively offered to remove any encroachment, making it doubtful that the plaintiff could have obtained injunctive relief against the defendant. The court concluded that the plaintiff must bear the taxed costs responsibility for the litigation it had initiated.

In conclusion, the court ordered that the plaintiff bear the defendant's taxed legal costs of the action. The court found that there had been no final determination of the dispute and that the plaintiff's conduct had been disproportionate to the underlying issue. The court held that the plaintiff was not entitled to indemnity costs and that the defendant was entitled to its taxed costs, which should be by reference to scale allowances. The court also noted that the third party had effectively offered to remove any encroachment, making it doubtful that the plaintiff could have obtained injunctive relief against the defendant.

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

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Ratio Decidendi

Legal Principle Established

The core difficulty in the present case is that there has been no final determination of this dispute, either in favour of the plaintiff, against the defendant, or concerning the third party (see Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 622, 624 ‑ 625 (McHugh J)). The present costs applications therefore presents a unique situation in which, there being no 'result', both the plaintiff and the defendant effectively self‑proclaim themselves as the 'victors' and seek costs orders, against the other. I am of the view, as a matter of discretion, the plaintiff should not receive its costs. Further, it must instead bear the defendant's taxed legal costs of this action. I reach that view as:(a)there was no effective 'result' in this litigation. What unfolded after too much time was an incomplete compromise, effectively between the plaintiff and the third party, just before trial in November 2011. The defendant concurred in this outcome. A partial resolution of the dispute saw the third party accept responsibility of remedial works to excise all surface or subterranean encroachments into Lot 219 from spill or concrete footings from Lot 218;(b)the plaintiff significantly altered its position over time to no longer seek compulsory acquisition relief. It took that tactical change relatively late in its action against the defendant by its further amended statement of claim of 21 July 2011. In seeking the physical excision of the footings incursion, the plaintiff was ultimately pursuing a more sensible and logical remedial result. This was the remedy it ought to have pursued before commencing, what was always, wholly uneconomic litigation. The plaintiff eventually gave up on more extravagant compulsory acquisition relief pursuant to s 122 and s 123 of the Property Law Act;(c)the third party had effectively offered to remove any encroachment made. Bearing this in mind, it is doubtful a court in the exercise of a discretion would have granted this plaintiff a permanent mandatory injunction to compel the defendant in terms of par 1A of the plaintiff's further amended statement of claim of 21 July 2011. A court would be unlikely to issue a permanent mandatory injunction against a defendant, if that same result was then being volunteered (at no cost) by a third party. Equitable relief by injunction is discretionary. In the present case it was sought by the plaintiff late, in a context of what was essentially a common law claim over the unintentional trespass to Lot 219. Equity assists the common law in its ancillary jurisdiction. But discretionary considerations arise. With a third party builder offering to physically remove any encroachments to Lot 219 at its expense, it is more than doubtful whether the plaintiff could ever have obtained injunctive relief against the defendant to the same end;(d)a position as was ultimately accepted by this plaintiff in October 2011, as regards the remedial works to be occasioned by and paid for by the third party, amounted to a very significant 'back down' in the plaintiff's position. The plaintiff had once claimed damages against the defendant for lost rental, diminution in capital value to Lot 219, soak well relocation costs plus exemplary damages. Those claims were not ultimately pursued, let alone vindicated. The defendant had rejected them from the start. Pursuing the extravagant compulsory acquisition relief, in my view, contributed towards a most regrettable inability in the parties to sensibly reach an earlier resolution of a wholly uneconomic dispute;(e)all proceedings are agreed as being appropriately dismissed between all parties. If a plaintiff seeks leave to withdraw an action against a defendant, a prima facie position arising out of O 23 of the Rules of the Supreme Court 1971 (WA) is that the defendant will enjoy an entitlement to taxed costs of the litigation to that point. That provides some analogy to present circumstances. Although this is a case of consensual dismissal of the action, the plaintiff's action, in effect, has been effectively withdrawn before trial. Consistent with the observations by Le Miere J in Walter v Buckridge [No 4] [2011] WASC 313, where an action commenced is to be consensually dismissed without proceeding to trial, a plaintiff is generally exposed to an adverse costs order, having started the litigation and therefore being responsible for the ensuing expenditures as sought with the defence of the litigation. A subsequent realisation on the part of the plaintiff that litigation it has begun is pointless, coupled with an assertion that it nonetheless conducted itself reasonably throughout the course of proceedings is not sufficient, without more, to shift the cost exposure tied to starting the litigation away from the plaintiff as the party who has 'cast the first stone'. (See also Garwolin Nominees Pty Ltd v Statewide Building Society (1984) VR 469, 472); Re Minister for Immigration and Ethnic Affair; Ex parte Lai Qin (McHugh J)).(f)my review of the voluminous materials filed on this application has not identified anything to detract from the prima facie exposure of this plaintiff to the taxed legal to costs of the defendant; (g)I am of the view that from about May 2010, the defendant, by its Calderbank letters, articulated what has now been shown to be a reasonable position as regards offering (via the third party) to rehabilitate the encroachments onto Lot 219;(h)the defendant's position was vindicated as a result of the remedial works commissioned by the third party, carried out at the third party's expense;(i)I have not overlooked the surface spill‑over and footing incursions into Lot 219 constituted a wrong and civil trespass to the plaintiff's land. But the plaintiff had options towards seeking reasonable relief. The plaintiff had no licence to demand, without consequence, high tier acquisition relief for a 'sliver' of its land; (j)I assess the plaintiff's overall conduct of its action to be disproportionate to the underlying subterranean footing incursion problem. The plaintiff was extravagant in its early demands and had to 'back down' in the face of this defendant's vindicated stance over time;(k)this is not a case analogous to certain discontinuance scenarios by leave, where some unforeseen event intrudes to render a plaintiff's action moot, in a way that it must be said there was no fault on either side. Rather, this is a case more akin to a discontinuance under leave where a plaintiff retreats from an early stance adopted at the commencement of its litigation. In the end, given what has transpired to remedy the encroachment problem to Lot 219, the plaintiff must bear the taxed costs responsibility for the 'tidal wave' it ultimately unleashed.(l)the defendant should receive its taxed costs, which should be by reference to scale allowances. The defendant has not established that an award of costs taxed to the relevant scale will not substantially provide appropriate redress. Furthermore, I am not persuaded to impose punitive indemnity cost orders (see Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129(S) [3]).