Roberts v Roberts (No 2)

Case [2021] SASC 91

SUPREME COURT OF SOUTH AUSTRALIA

(Civil)

ROBERTS v ROBERTS (No 2)

[2021] SASC 91

Judgment of the Honourable Justice Blue  

PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS

PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - OFFERS OF COMPROMISE, PAYMENTS INTO COURT AND SETTLEMENTS - INFORMAL OFFERS AND CALDERBANK LETTERS - GENERALLY

The applicant succeeded in his primary action in obtaining an order that the first respondent convey title to his station Pulgamurtie in return for payment of $3,808,350: Roberts v Roberts [2021] SASC 72. In his secondary action, the applicant established that the respondents repudiated the Heads of Agreement and he lawfully terminated it but failed to establish substantive damages. The two actions were initially heard together and consolidated during the trial.

The applicant seeks an order that the first respondent pay his costs of the primary action up to 14 September 2020 on the standard costs basis and from 15 September 2020 on the indemnity basis as a result of the non-acceptance by the first respondent of a Calderbank offer made on 1 September that was less favourable to the applicant than the judgment ultimately obtained.

The applicant seeks an order that the second respondent pay his costs of the secondary action on the standard costs basis. The respondents seek an order that each party bear their own costs of that action.

Held:

1By reason of the first respondent’s non-acceptance of the 1 September offer, he should pay the applicant’s costs of the primary action on the solicitor/client basis from 22 September 2020 (at [28]).

2The second respondent should pay the applicants costs of the secondary action up to 29 April 2020 (at [33]).

3The parties should notionally bear their own costs of the secondary action from 30 April 2020 onwards (at [39]).

4Broad axe assessment that 4 per cent of the combined costs of both actions from 30 April 2020 onwards related to the secondary action (at [47]).

5To avoid two taxations, a single order should be made that the first respondent pay 96 per cent of the applicant’s costs of the combined actions (at [41]).

6Orders made to this effect (at [48]).

Calderbank v Calderbank [1975] 3 All ER 333; Stewart v Atco Controls Pty Ltd (In Liquidation) (No 2) (2014) 252 CLR 331, considered.

ROBERTS v ROBERTS (No 2)
[2021] SASC 91

  1. BLUE J: On 17 June 2021 I delivered reasons for judgment in which I concluded that in the primary action the applicant (Grant) succeeded on his cause of action in proprietary estoppel and the appropriate remedy was to order that the first respondent (Jack) convey title to Pulgamurtie in return for payment of $3,808,350.[1]  I concluded that in the secondary action the second respondent (Nola) and Jack repudiated the Heads of Agreement and Grant lawfully terminated it for repudiation but Grant would only have been entitled to nominal damages if he had failed in the primary action. The…

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AGLC
Roberts v Roberts (No 2) [2021] SASC 91
Case
[2021] SASC 91
Decision Date

CaseChat Overview and Summary

In the case of Roberts v Roberts (No 2), Grant sought an order that Nola pay his costs of the secondary action on the standard costs basis, while Nola and Jack sought an order that each party bear their own costs of the secondary action. The dispute arose out of a complex series of legal proceedings involving property and inheritance claims. The primary action involved claims for transfer of property and financial compensation, while the secondary action involved claims for indemnity costs and declaratory relief. The case was heard in the Supreme Court of South Australia.

The court had to determine several legal issues, including whether Grant was entitled to indemnity costs under rule 132.11 of the Uniform Civil Rules 2020 (SA) for the primary action, and whether the costs of the secondary action should be apportioned between the parties. The court also had to determine the appropriate basis for assessing the costs of the actions. The court found that Grant was not entitled to indemnity costs for the primary action because the judgment he obtained was less favourable than the terms of an earlier offer. However, the court found that Nola and Jack should bear their own costs of the secondary action up to 29 April 2020, and that Jack should pay 96% of Grant's costs of the combined actions from 30 April 2020 onwards on the solicitor/client basis.

The court's reasoning was based on a detailed analysis of the procedural history of the case, including the various offers and counter-offers made by the parties. The court found that Nola and Jack had not acted reasonably in rejecting Grant's offers to settle the primary action, and that this was a relevant consideration in determining the costs of the actions. The court also found that a broad axe assessment was appropriate for determining the costs of the secondary action, and that a single order should be made to avoid two taxations. The court's outcome was that Grant was entitled to a significant proportion of his costs, but that the parties should bear their own costs of the secondary action up to a certain date.

The final orders of the court were that the action by Nola was dismissed, and that Jack should pay Grant's costs of the primary and secondary actions on the standard costs basis up to a certain date, and on the solicitor/client basis from that date onwards. The court also ordered that Nola should pay Grant's costs of the secondary action up to the same date on the standard costs basis. The court certified that the costs were fit for two counsel, including senior counsel.

Orders

Orders of the court

Held:

1 By reason of the first respondent’s non-acceptance of the 1 September offer, he should pay the applicant’s costs of the primary action on the solicitor/client basis from 22 September 2020 (at [28]).

2 The second respondent should pay the applicants costs of the secondary action up to 29 April 2020 (at [33]).

3 The parties should notionally bear their own costs of the secondary action from 30 April 2020 onwards (at [39]).

4 Broad axe assessment that 4 per cent of the combined costs of both actions from 30 April 2020 onwards related to the secondary action (at [47]).

5 To avoid two taxations, a single order should be made that the first respondent pay 96 per cent of the applicant’s costs of the combined actions (at [41]).

6 Orders made to this effect (at [48]).

Background

Background to the litigation

Grant seeks an order that Nola pay his costs of the secondary action on the standard costs basis. Nola and Jack seek an order that each party bear their own costs of that action.Background The trial of the proceeding was originally listed to commence on Monday 21 September 2020 but was deferred by one day to commence on Tuesday 22 September 2020. On 31 August 2020 Grant filed a formal offer (the 1 September offer) under rule 132.4 of the Uniform Civil Rules 2020 (SA) (the Rules). Grant offered to settle the primary action on the basis of a consent judgment that Jack pay to him $3.5 million and pay his costs of the primary action on the standard costs basis. The offer was not served on Jack’s solicitors until the morning of 1 September 2020. The offer was not a “relevant offer” within the meaning of rule 132.10 because it was not served at least 21 days before the commencement of the trial. However, Grant seeks an order for indemnity costs in the discretion of the Court under rule 132.11 on the basis that the judgment he has obtained in the action is on terms more favourable to him than the terms of the offer. On 28 August 2020 Grant had filed and served an earlier formal offer in which he offered to settle the primary action on the basis of a consent judgment that Jack transfer Pulgamurtie to him in return for payment of $2.85 million and pay Grant’s costs of the primary action on the standard costs basis. The judgment that Grant obtained in the action was less favourable than the terms of this offer. On 28 August 2020 Grant’s solicitors sent a letter to Jack’s solicitors referring to the formal offer served earlier that day inviting Jack to participate in immediate settlement discussions, saying that Grant was open to all alternatives and identifying some alternative mechanisms for resolution. On 1 September 2020 Grant’s solicitors sent a further letter to Jack’s solicitors reiterating that Grant was open to all alternatives to enable him to keep farming Pulgamurtie with financial security. On 2 September 2020 Jack’s solicitors sent a letter to Grant’s solicitors responding to their two letters and making an offer (open for 10 days) to settle the action (the 2 September offer) on the basis that:1Jack would pay to Grant $500,000 with or without (at Grant’s choice) an option for Grant to purchase Pulgamurtie within four months at market value as recently determined by Mr Hickey;2Jack and Nola would make new wills leaving their estate equally to Grant, Mark and Louise; the payment of $500,000 to Grant would be called into hotchpot against Grant’s share under the will; and Jack and Nola would execute a deed binding them not to change their wills; and3the action would be dismissed with no order as to costs. On 3 September 2020 Grant’s solicitors sent a letter to Jack’s solicitors offering to settle the action (the 3 September offer) on two alternative bases. One offer was an elaboration on the 28 August offer (amongst other things increasing the price to $3 million and including a release of rights to make an inheritance claim). The other offer was that (amongst other things) Jack transfer a one third interest in Pulgamurtie to Grant and the parties resume a 50/50 partnership.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

My overall assessment is that four per cent of the combined costs of action incurred on and after 30 April 2020 should be apportioned to secondary action issues.Conclusion Subject to hearing counsel, I will make the following orders:1The action by Nola (originally action number 87 of 2020) is dismissed.2On the cross action by Grant (originally action number 87 of 2020), it is declared that Nola and Jack Roberts repudiated the Heads of Agreement dated 28 November 2018 between Nola, Jack and Grant, and Grant validly terminated the Heads of Agreement himself on 29 April 2020.3Jack is to pay Grant’s costs of action in respect of action number 996 of 2018 up to and including 29 April 2020 on the standard costs basis.4Nola is to pay Grant’s costs of action in respect of action number 87 of 2020 up to and including 29 April 2020 on the standard costs basis.5Jack is to pay 96 per cent of Grant’s costs of action in respect of action number 996 of 2018 and action number 87 of 2020 from 30 April 2020 up to and including 21 September 2020 on the standard costs basis.6Jack is to pay 96 per cent of Grant’s costs of action in respect of action number 996 of 2018 and action number 87 of 2020 on and after 22 September 2020 on the solicitor/client basis.7Costs certified fit for two counsel including senior counsel.

Ratio Decidendi

Legal Principle Established

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