S, DJ v Channel Seven Adelaide Pty Ltd & Anor
[2007] SASC 80
•9 March 2007
SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
S, DJ v CHANNEL SEVEN ADELAIDE P/L & ANOR
[2007] SASC 80
Judgment of The Full Court
(The Honourable Justice Debelle, The Honourable Justice Gray and The Honourable Justice Anderson)
9 March 2007
PROCEDURE - COSTS - RECOVERY OF COSTS
Recovery of costs before conclusion of action – plaintiff had benefit of order for costs - plaintiff unable to carry burden of costs incurred to date without significant embarrassment and unless he realises assets he does not wish to sell – whether plaintiff permitted to recover costs before conclusion of action – relevant factors – application (by majority) allowed.
Supreme Court Rules 1987 R 101.01(7); Supreme Court Civil Rules 2006 R 8(2), R 265; Uniform Civil Procedure Rules 2005 R 42.7(2), referred to.
Allstate Life Insurance Co v Australia and New Zealand Banking Group Ltd (No 13) [1995] FCA 626; Alstom Power Ltd v Yokogawa Australia Pty Ltd (No 2) (2006) 244 LSJS 65; Australian Flight Test Services Pty Ltd v Minister for Industry, Science and Technology [1996] FCA 288; Bailey v Beagle Management Pty Ltd (2001) 105 FCR 136; Fiduciary Limited v Moringstar Research Pty Ltd (2002) 55 NSWLR 1; Horrobin v Australia and New Zealand Banking Group Ltd (unreported, New South Wales Court of Appeal, 6 June 1997); Life Airbag Company of Australia Pty Ltd v Life Airbag Company (New Zealand) Ltd [1998] FCA 545, applied.
All Services Australia Pty Ltd v Telstra (2001) 171 ALR 330; Duke Group Ltd v Alamein Investments Ltd [2006] SASC 209; Favell v Queensland Newspapers Pty Ltd (2005) 221 ALR 186; Hepburn v TCN Channel Nine Pty Ltd [1983] 2 NSWLR 682; McNamara Business & Property Law v Kasmeridis (No 3) [2006] SASC 262; Murran Investments Pty Ltd v Aromatic Beauty Products Pty Ltd (2000) 191 ALR 579, considered.
S, DJ v CHANNEL SEVEN ADELAIDE P/L & ANOR
[2007] SASC 80Full Court: Debelle, Gray and Anderson JJ
DEBELLE J. This is an application by a party who has the benefit of costs orders in his favour to tax the costs before the conclusion of the proceedings.
On 21 May 2004 the plaintiff commenced this action. He seeks to recover damages from the defendants for defamation.
In August 2004, both of the defendants applied to strike out paragraphs in the statement of claim. On 8 December 2004 a Master of this Court ordered that the paragraphs be struck out.
On 14 December 2004 the plaintiff appealed against the orders of the Master. On 20 May 2005 White J allowed the appeal and ordered that the defendants pay the plaintiff’s costs of the appeal.
In early August 2005 the defendants appealed against the order of White J. On 20 January 2006 this Full Court dismissed the application and ordered that the defendants pay the plaintiff’s costs of the appeal.
The plaintiff later asked the defendants to agree the costs of the appeals to White J and to the Full Court. The defendants were not willing to agree those costs. They have required the plaintiff to tax his bill of costs. On 1 August 2006 the plaintiff served a short bill of costs on the defendants. On 13 September 2006 the plaintiff served a long bill of costs on the defendants.
On 12 September 2006 the solicitors for the first defendant sent a letter to the plaintiff’s solicitors asserting that by reason of the terms of R 101.01(7) of the Supreme Court Rules1987 or R 265 of the Supreme Court Civil Rules 2006, the plaintiff was not entitled to recover any costs until completion of the action. On 26 September 2006 the solicitors for the second defendant wrote to the plaintiff’s solicitors a letter making the same assertion in similar terms. Rule 101.01(7) provides:
An order for costs on an interlocutory proceeding shall not, unless the Court otherwise orders, entitle a party to have a bill of costs taxed until the principal proceeding in which the interlocutory order was made is concluded or further order.
On 6 October 2006 the plaintiff applied for an order under R 101.01(7) that his costs be taxed and payable immediately. The application was listed before a Master. The Master expressed doubts whether he had jurisdiction to make the orders sought by the plaintiff. In light of those doubts he referred the application to this Full Court.
The parties have consented to the plaintiff’s application being determined upon the papers without oral argument. The plaintiff’s solicitor has filed an affidavit in support of the application. All parties have lodged written submissions.
The first question for determination is whether the application should be made under the 1987 Rules or the 2006 Rules. The 2006 Rules came into operation on 4 September 2006. Rule 8(2) of the 2006 Rules provides an exception to the general principle that the 1987 Rules continue to apply to actions commenced before 4 September 2006. It provides:
(2)The general principle is, however, subject to the following exceptions and qualifications-
(a) Chapter 12 (Costs) applies, from the commencement date, to an action or appellate proceedings commenced before, on or after the commencement date unless proceedings for the taxation of costs in the relevant action or proceedings had been commenced before the commencement date.
In Duke Group Ltd v Alamein Investments Ltd [2006] SASC 209, White J held at [19] that R 101.01(7) barred the service of a short form bill on the basis that it was the taking of an essential prerequisite step towards the taxation of the costs. By parity of reasoning, it follows that the service here by the plaintiff of the short form bill on 1 August 2006 was the commencement of the proceeding for the taxation of the costs in question. As that occurred before 4 September 2006, the exception in R 8(2) of the 2006 Rules does not apply and R 101.01(7) of the old Rules is the applicable Rule. In any event, if R 265 of the 2006 Rules applies, it would not make any difference to the outcome as it is expressed in very similar terms to R 101.01(7).
Shortly stated, the effect of R 101.01(7) is that, in the absence of an order of the Court to the contrary, a party is not entitled to have his costs taxed until the principal proceedings are concluded. The plaintiff seeks an order that he be permitted to tax his costs at this stage.
All parties accept as accurate my summary of the nature of the discretion in Alstom Power Ltd v Yokogawa Australia Pty Ltd(No. 2) (2006) 244 LSJS 65 at [4]-[8]:
[4]The discretion with which r 101.01(7) invests the court is unfettered. The rule is expressed in terms which make it clear that the general rule is that a taxation of costs will occur at the conclusion of the proceedings, unless the court makes an order to the contrary. It is not appropriate to state that the order for costs shall be paid forthwith will be made in “rare” or in “exceptional” circumstances. The rule clearly states the general position so that to add epithets such as “rare” or “exceptional” is to add words to the rule in an impermissible manner, which may cause the exercise of the court’s discretion to be improperly fettered.
[5]As far as the research of counsel and my own research disclose, the rule has not been the subject of consideration by this Court in any reported decision. However, the rule is in the same terms as O 62 r 3(3) of the rules of the Federal Court of Australia which has received quite a degree of judicial notice.
The Underlying Policy
[6]The policy reasons underlying O 62 r 3(3) were noted by Sackville J in Courtney v Medtel Pty Ltd (No 3) [2004] FCA 347. They include
1. discouraging interlocutory applications: Stack v Brisbane City Council (1996) 71 FCR 523 at 534;
2. avoiding the inconvenience and possible oppression involved in a series of taxations where there are successive interlocutory applications: Vasyli v AOL International Pty Ltd [1996] FCA 804; and
3. the fact that it is usually inappropriate to require the unsuccessful party to interlocutory proceedings to pay costs immediately, since that party might ultimately succeed in the substantive proceedings and set‑offs can be made in light of the ultimate orders as to costs: Brasington v Overton Investments Pty Ltd [2001] FCA 571 at 13; Bailey v Beagle Management Pty Ltd (2001) 105 FCR 136 at 145.
Those policy considerations apply with equal force to costs orders made in this Court. Those policy reasons inform the factors to be considered when this Court is deciding whether to depart from the general rule.
[7]In the Federal Court O 62 r 3(3) has been generally interpreted as conferring a discretion which should be exercised in favour of a party who establishes that the demands of justice require a departure from the general practice: Thunderdome Racetiming & Scoring Pty Ltd v Dorian Industries Pty Ltd (1992) 36 FCR 297 at 312; Stack v Brisbane City Council (supra) at 535; Murran Investments Pty Ltd v Aromatic Beauty Products Pty Ltd (2000) 191 ALR 579 at 594. Some judges in the Federal Court have expressed the view that a departure from the general rule should be countenanced only in “rare cases”: Vasyli (supra). Others have suggested that the power might be somewhat under‑utilised: Allstate Life Insurance Co v Australia and New Zealand Banking Corporation Ltd (No 14) [1995] FCA 660; Life Airbag Company of Australia Pty Ltd v Life Airbag Company (New Zealand) Ltd [1998] FCA 545; McKellar v Container Terminal Management Services Ltd [1999] FCA 1639 at [41]. I do not believe that anything is to be gained by considering whether or not the power should be rarely used. The question for consideration is whether it is in the interests of justice to make an order in the individual case, having regard to the fact that the general rule is that costs are not payable until the conclusion of the principal proceeding.
Relevant Factors
[8]The factors identified by the Federal Court as justifying a departure from the general rule include the following.
1. Where an interlocutory proceeding involving a discrete issue has been resolved: Australian Flight Services v Minister for Industry Science & Technology [1996] FCA 288; Courtney v Medtel Pty Ltd (No 3). However, where the interlocutory proceeding concerns pleadings, especially pleadings in a complex action, such an order will not usually be made: All Services Australia Pty Ltd v Telstra (2001) 171 ALR 330 at 333; Murran Investments Pty Ltd v Aromatic Beauty Products Pty Ltd (supra).
2. Where the principal proceedings are not likely to be resolved for some time so that, in the absence of an order, the successful party will not enjoy the fruits of the interlocutory order for a long period: Life Airbag (supra); Allstate Life Insurance Co v Australia and New Zealand Banking Corporation Ltd (No 13) [1995] FCA 626.
3. Where the interlocutory application has had the effect of removing one of several causes of action in its entirety: Mitanis v Pioneer Concrete (Vic) Pty Ltd (1998) ATPR 41‑623.
4. Where the application is an unsuccessful application for leave to appeal on an interlocutory matter of practice and procedure given the strong public policy against the proliferation of such applications: Bailey v Beagle Management Pty Ltd (supra) at 145.
These principles are equally applicable to an application under r 101.01(7). There are further matters for consideration. The court will, as a general rule, set its face against multiple applications for costs to be taxed and payable forthwith as the interlocutory proceedings unfold. That proposition does no more than reflect the terms of the rule and the policy reasons underlying it.
In addition to these factors, regard must be had to the financial resources of parties to litigation. In Bailey v Beagle Management Pty Ltd (supra) at 145, the Full Court of the Federal Court of Australia said, when dealing with a claim for costs against a private individual:
Impecunious litigants who have a meritorious claim or defence would not be forced out of court because of inability to meet interlocutory costs orders.
It is a corollary of that principle that impecunious litigants who have a meritorious claim or defence should be able to be paid what is due on an interlocutory costs order if the interlocutory proceedings concern a discrete issue and that issue has been resolved especially where the principal proceedings are not likely to be resolved for some considerable time: Australian Flight Test Services Pty Ltd v Minister for Industry, Science and Technology [1996] FCA 288; Life Airbag (supra); Allstate Life Insurance Co v Australia and New Zealand Banking Group Ltd (No 13) [1995] FCA 626.
That conclusion is consistent with the remarks of Priestley JA in Horrobin v Australia and New Zealand Banking Group Ltd (unreported, New South Wales Court of Appeal, 6 June 1997) at 9:
None of the cases is on all fours with the present one; indeed, a reading of them emphasises the need for cases to be considered by reference to their own particular facts. Nevertheless, those relied on by counsel for H and S show there is a tendency for costs orders to be made payable forthwith and without waiting for the conclusion of further proceedings when the proceedings in respect of which the costs orders have been made are regarded as sufficiently self contained and detached or detachable from proceedings yet to be heard, whether between the same or associated parties, as to make it seem just for an actual payment to be made in the meantime.
The Rule on which Priestley JA commented was Rule 9 of the Part 52A of the Supreme Court Rules 1970. Rule 9 relevantly provide:
9 (1) Where before the conclusion of any proceedings … the Court makes an order for the payment of costs or a motion is refused with costs, the costs shall not, unless the court otherwise orders, be payable until the conclusion of the proceedings.
…
(3) Where in any proceedings:
(a) it appears to the Court that:
(i)a party has been subject to unreasonable delay or default on the part of any other party;
(ii) the proceedings are unreasonably protracted; or
(b) a costs order is made under r 43 or r 43A,
the Court may order that costs, or a specified amount on account of costs, be payable forthwith.
In Fiduciary Limited v Morningstar Research Pty Ltd (2002) 55 NSWLR 1, Barrett J held that sub-rule (3) did not represent an exhaustive catalogue of the circumstances in which the Court may order that costs be payable forthwith. He said that the starting point was the decision of Priestley JA in Horrobin to which I have already referred. From that starting point Barrett J identified three cases where it might be appropriate to depart from the general rules, namely,
1.where the interlocutory proceeding represents the determination of a separately identifiable matter or may be viewed as a completion of a discrete aspect of the action: see, for example, Charlie Brown Pty Ltd v Green (unreported, Supreme Court of NSW, McLelland CJ in Eq, 3 July 1995) and Bagley v Pinebelt Pty Ltd [2000] NSWSC 830;
2.where there has been unreasonable conduct on the part of the party against whom costs have been order: Gattellari v Meagher [1999] NSWSC 1279; and
3.a considerable time remains before the proceedings will ultimately be determined: Doran Constructions Pty Ltd v University of Newcastle (unreported, Supreme Court of NSW, Giles J, 16 December 1994) at 21.
There is an obvious correspondence between these principles and those expressed by judges in the Federal Court of Australia. The New South Wales rule has been replaced by r 42.7(2) of the Uniform Civil Procedure Rules 2005 (NSW) in that court which provides:
Unless the court orders otherwise, costs referred to in subrule (2) do not become payable until the conclusion of the proceedings.
Plainly, the new rule does not affect the principles enunciated in respect of the former rule. These principles apply with equal force to an application for taxation of costs before the conclusion of the proceedings under both Rule 101.01(7) and Rule 265 of the 2006 Rules. While the Court has an unfettered discretion to make an order and that discretion must not be fettered by epithets such as “exceptional”, the applicant for taxation of costs before the conclusion of the proceedings must satisfy the Court that there are reasons to depart from the general rule.
The plaintiff asserts through his solicitor that he has incurred substantial costs. No evidence was led of the actual amount he has paid in costs. However, the bill of costs which has been filed totals in excess of $55,000. On any view, that is a very substantial amount.
The plaintiff has since incurred other costs on a number of interlocutory hearings which have occurred since the appeal. In consequence of the decision of the Full Court, the plaintiff made a number of objections to the defence of the first defendant. On 26 May 2006 the first defendant filed a further amended defence. On 21 August 2006 the plaintiff applied to strike out the first defendant’s defences of justification and of fair comment. On 31st August the plaintiff’s application was heard by a Master who struck out the first defendant’s defence of justification. The Master declined to strike out the defence of fair comment. On 13 September 2006 the first defendant lodged a notice of appeal in respect of the decision of the Master. On 22 September a Judge of this Court referred the appeal, and any cross appeal by the plaintiff, for hearing by the Full Court. The appeal has been heard but judgment has not yet been delivered.
An important factor is that the appeals have concluded the interlocutory issue. Some aspects of those issues may have to be addressed when the plaintiff’s claim is heard but, for the time being, the issues agitated on the interlocutory orders have been resolved. More importantly, the costs orders will not be disturbed whatever the outcome of the litigation.
In his affidavit, the plaintiff’s solicitor deposes that the plaintiff is a professional photographer. Immediately before the publication of the statements the subject of this action, he was in the employ of Messenger Press Ltd as a professional photographer and had been so employed for some 16 years. He says that, as a result of the publicity surrounding the statements published by the defendants, the plaintiff lost his employment with Messenger Press Ltd on 5 July 2004. It is not necessary to find whether the plaintiff lost his job as a result of the publicity. It is sufficient for the purpose of this application that he has lost his full-time employment. The plaintiff has obtained part-time and casual work in a variety of semi-and low skilled occupations.
According to his solicitor, the plaintiff has expressed his concern that some considerable time will elapse before the action is heard. The plaintiff has informed his solicitor that he is unable to carry the burden of the costs incurred to date without significant financial embarrassment and unless he realises assets he does not wish to sell. Given that the plaintiff has lost his regular employment as a professional photographer and given that he has already incurred substantial costs amounting to at least $55,000, I find that the plaintiff would be in severe financial difficulty unless he is able to recover costs payable on costs orders made in his favour.
In their submissions, the defendants have criticised the fact that the affidavit in support of the application was sworn, not by the plaintiff, but by the plaintiff’s solicitor. They contend that in this way the plaintiff has avoided cross-examination and that the plaintiff’s solicitor has no direct knowledge of the financial position of the plaintiff. However, the defendants have consented to this procedure. They had means available to them to dispute the facts to which the plaintiff’s solicitor has deposed. Having consented to this procedure, the defendants must accept the facts as asserted by the plaintiff’s solicitor. In any event, it is not difficult to conclude that, having lost his full-time employment, the plaintiff is experiencing considerable financial difficulty in continuing to prosecute this action. He should not have to realise his assets when a means is available to recover some of the costs he has so far incurred, especially as they are costs recoverable on an order which will stand whatever the outcome of this litigation.
In addition to these considerations the defendants are both substantial corporations who are well able to afford to pay the costs sought by the plaintiff. They will not in any respect be placed at any disadvantage in this action by having to pay the costs as taxed. There is an obvious and considerable disparity between the financial resources of this plaintiff and the resources of each of these substantial defendants. The plaintiff is a private citizen who has lost his full-time employment. The defendants are both substantial corporations and each is clearly to pay the costs which have been ordered. This disparity between the financial resources of the parties has the capacity to exhaust the means of the plaintiff to prosecute this action and seek to vindicate his reputation: cf. Hepburn v TCN Channel Nine Pty Ltd [1983] 2 NSWLR 682 per Hutley JA at 692 and Favell v Queensland Newspapers Pty Ltd (2005) 221 ALR 186 at [21]-[22]. That disparity should not cause the plaintiff to have to abandon these proceedings because he can no longer afford to prosecute them. The interests of justice require that the plaintiff be permitted to recover his costs at this stage.
There is a further consideration. The costs of an appeal on an interlocutory matter do not appear to fall within the terms of Rule 101.01(7). I do not express a final view on that matter especially as the matter was not argued. It is a matter for another day.
For these reasons, I would allow the plaintiff’s application.
GRAY J: The plaintiff seeks an order to have two costs orders taxed immediately and paid forthwith following the issue of an allocatur. The relevant costs orders are those made by this Court on 20 January 2006 and by White J on 20 May 2005.
The history of this matter is set out in the reasons of Debelle J. I only refer to that history where necessary for an understanding of these reasons.
The application before this Court proceeded on the basis that rule 101.01(7) of the Supreme Court Rules 1987 applied.[1] That rule provides:
An order for costs of an interlocutory proceeding shall not, unless the Court otherwise orders, entitle a party to have a bill of costs taxed until the principal proceeding in which the interlocutory order was made is concluded or further order.
[1] Initially the plaintiff brought the application pursuant to Rule 265 of the Supreme Court Rules 2006. A Master of this Court, before whom the application was argued, determined that the 1987 Rules applied. Both the plaintiff and defendant did not challenge this finding on the application before this Court. In any event, no significant difference exists between the discretion contained within Rule 101.01(7) or Rule 265.
Both counsel referred to Alstom Power Ltd v Yokogawa Australia Pty Ltd[2] and accepted Debelle J’s analysis of the nature of the discretion in rule 101.01(7).
[2] Alstom Power Ltd v Yokogawa Australia Pty Ltd (No. 2) [2006] SASC 87.
In Alstom, the defendant applied to have the action transferred to another court. The application was dismissed. Costs were awarded in favour of the plaintiff. The plaintiff then sought an order that the costs be taxed and paid forthwith. In granting the application Debelle J observed:[3]
The discretion with which r 101.01(7) invests the court is unfettered. The rule is expressed in terms which make it clear that the general rule is that a taxation of costs will occur at the conclusion of the proceedings, unless the court makes an order to the contrary. It is not appropriate to state that the order for costs shall be paid forthwith will be made in “rare” or in “exceptional” circumstances. The rule clearly states the general position so that to add epithets such as “rare” or “exceptional” is to add words to the rule in an impermissible manner, which may cause the exercise of the court’s discretion to be improperly fettered.
[3] Alstom Power Ltd v Yokogawa Australia Pty Ltd (No. 2) [2006] SASC 87 at [4].
Debelle J then went on to discuss the policy reasons underlying the rule and factors relevant to the exercise of the discretion.[4] Those factors include a consideration of whether:[5]
-the interlocutory proceeding involves a discrete issue. However, where the interlocutory proceeding concerns pleadings, especially pleadings in a complex action, the order will usually not be made;[6]
-the principal proceedings will not be resolved for some time;
-the interlocutory application has resolved part of the substantive claim;
-the interlocutory proceeding has been used inappropriately;
-an order for payment forthwith may stultify the proceedings; and
-an order for immediate payment would preclude an offsetting of costs orders.
[4] Alstom Power Ltd v Yokogawa Australia Pty Ltd & Ors (no 2) [2006] SASC 87 at [6] -[8].
[5] Alstom Power Ltd v Yokogawa Australia Pty Ltd & Ors (no 2) [2006] SASC 87 at [8]; see also McNamara Business & Property Law v Kasmeridis (No.3) [2006] SASC 262.
[6] Alstom Power Ltd v Yokogawa Australia Pty Ltd & Ors (no 2) [2006] SASC 87 at [8]; All Services Australia Pty Ltd v Telstra (2001) 171 ALR 330 at 333 and Murran Investments Pty Ltd v Aromatic Beauty Products Pty Ltd (2000) 191 ALR 579 at 594.
Counsel for the plaintiff in the present proceedings submitted that the Court should exercise its discretion and grant the plaintiff’s application on the ground that the interlocutory application determined the capacity of the words to give rise to the alleged imputation complained of, and could accordingly be viewed as the resolution of a discrete aspect of the action. It was said further that considerable time remained before the primary proceedings would be determined; that a large financial disparity existed between the parties; that the plaintiff would suffer financial embarrassment if the order were not made; and that there was a need to discourage further interlocutory applications due to the delay that had already occurred.
Counsel for the defendants submitted that the interlocutory application did not address a discrete issue. It was said that while the Court had held that the words published were capable of giving rise to the imputation pleaded by the plaintiff, the defendants may succeed at trial in establishing that as a matter of fact, that meaning does not arise.
It was the submission of counsel for the defendants that the delay associated with interlocutory applications thus far was not the sole responsibility of the defendants. Counsel contended that the plaintiff has prosecuted a number of interlocutory applications in addition to an unsuccessful cross-appeal.
Counsel for the defendants further submitted that while a financial inability to continue to prosecute the action is a relevant factor, there must be something more than a mere financial disparity between the parties. Counsel contended that the plaintiff has not demonstrated financial hardship sufficient to warrant an exercise of discretion in his favour. Counsel pointed to the fact that the plaintiff did not swear an affidavit in support of the application and as a result did not expose himself to cross-examination about his financial position. This was significant as the solicitor’s affidavit did not condescend to any particularity. Furthermore, the affidavit of the solicitor disclosed that the plaintiff does have assets available to him. While it is understandable that the plaintiff would not wish to realise those assets to fund the litigation, counsel for the defendants argued that there was no suggestion in the affidavit that the plaintiff would be required to sell his home or otherwise suffer undue hardship. Consequently, counsel submitted, the affidavit did not distinguish the plaintiff from many other litigants who may appear before this Court.
These submissions should be accepted.
The plaintiff has not demonstrated sufficient reason for this Court to exercise its discretion to permit an immediate taxation and recovery of costs. Sufficient evidence of undue financial hardship that would distinguish the plaintiff from other litigants has not been advanced. The affidavit of the plaintiff’s solicitor does no more than state that he has been advised by the plaintiff and verily believes “that these subject costs are a matter of real concern to the plaintiff and that the plaintiff is unable to carry these costs until the final conclusion of the matter without significant financial embarrassment to himself or with the need to realise assets that he does not wish to have to realise”. No evidence has been put to the Court as to the nature of the plaintiff’s financial embarrassment or what assets would need to be realised in order to continue the action. It is not possible to evaluate these assertions.
Furthermore, no inference should be drawn that the defendants have conducted this matter unreasonably. In the course of this litigation, both parties have pursued interlocutory applications and appeals. Finally, no discrete aspect of the action has been disposed of. The nature of the application in the present case can be distinguished from the application in Alstom to transfer the proceedings to another jurisdiction. In Alstom, it was clear that the issue finally determined on the application would not arise at trial. In the present case, this Court concluded that the words published are capable of carrying the pleaded meaning. At trial an issue to be resolved will be whether the pleaded meaning does or does not arise.
In a complex action there will often arise the need for interlocutory applications. While “rare” or “extraordinary” circumstances do not need to be established for the Court to exercise its discretion, a sound basis for departing from the general rule is still required. This has not been demonstrated in this case. This is not a case where the Court should exercise its discretion and order that the costs of the interlocutory action be taxed and payable forthwith.
Conclusion
This application should be dismissed.
ANDERSON J: The facts and relevant background to this matter are set out in the reasons of Debelle J. I have also read the reasons of Gray J. Because of the different results reached by their Honours I will indicate why I agree with the result reached by Debelle J.
The defendants have been unsuccessful in two appeals before White J and the Full Court. That means that certain publications of the defendants have now been held to have the capacity of conveying the meanings alleged by the plaintiff. Whilst the trial will ultimately decide whether the publications do carry the meanings alleged, the issue of the capacity to do so is finally determined.
The trial and the end result of this litigation is a long way off. The plaintiff has won the preliminary issue and is out of pocket. The amount of the plaintiff's costs is substantial as the bill in taxable form totals $55,000.00. The plaintiff is prejudiced in the proper conduct of his case whilst he has to bear the burden of those costs.
There is a considerable imbalance between the financial position of the parties. The respondents will suffer no prejudice but the plaintiff will, if the costs to which the plaintiff is entitled, are not paid prior to the finalisation of the litigation. At the conclusion of the trial there will be two further potential levels of appeal. This will further prolong the litigation if appeals are initiated. The proceedings were commenced two and a half years ago and still have a considerable distance to run. The final result on the merits, even after two appeals will not make any difference to these interlocutory orders for costs.
In these circumstances it is my view that the discretion contained within rule 101.01(7) should be exercised in favour of the plaintiff.
This plaintiff has lost a job which he had previously held for 16 years. He has lost income and is substantially out of pocket in this matter. He is entitled to defend very serious allegations made about him by the defendants in the publications. He is entitled to protect his reputation by challenging those allegations in these proceedings.
The plaintiff should not be penalised by being required to wait a considerable time before being reimbursed for his success at the interlocutory level.
Each case has to be decided on its merits but I agree with Debelle J that the interests of justice in this case require that the plaintiff recover his costs to date. I would therefore allow the plaintiff's application.
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