MARTIN BRUCE JONES AS RECEIVER AND MANAGER OF NEWPORT SECURITIES PTY LTD AND AS AGENT OF THE MORTGAGEE IN POSSESSION OF 3517 ROAD, WILYABRUP First-named First Respondent
DARREN GORDON WEAVER AS RECEIVER AND MANAGER OF NEWPORT SECURITIES PTY LTD AND AS AGENT OF THE MORTGAGEE IN POSSESSION OF 3517 CAVES ROAD, WILYABRUP Second-named First Respondent
ANDREW JOHN SAKER AS RECEIVER AND MANAGER OF NEWPORT SECURITIES PTY LTD AND AS AGENT OF THE MORTGAGEE IN POSSESSION OF 3517 CAVES ROAD, WILYABRUP Third-named First Respondent
MARTIN BRUCE JONES AS RECEIVER AND MANAGER OF MAYPORT NOMINEES PTY LTD First-named Second Respondent
DARREN GORDON WEAVER AS RECEIVER AND MANAGER OF MAYPORT NOMINEES PTY LTD Second-named Second Respondent
ANDREW JOHN SAKER AS RECEIVER AND MANAGER OF MAYPORT NOMINEES PTY LTD Third-named Second Respondent
MARTIN BRUCE JONES AS RECEIVER AND MANAGER OF SEAPORT PTY LTD First-named Third Respondent
JOHN ROSS LINDHOLM AS RECEIVER AND MANAGER OF SEAPORT PTY LTD Second-named Third Respondent
COMMONWEALTH ATTORNEY-GENERAL Intervener
Catchwords:
Constitutional law - Chapter III - Judicial power of the Commonwealth - Referral of legal issue - Validity of s 596A and s 597 of the Corporations Act 2001 (Cth) - Power of court to summon a person before it for examination about the examinable affairs of a corporation in receivership or where property of a corporation is in the possession of a mortgagee or its agent and to conduct an examination - Whether power judicial when exercised on the application of a privately appointed receiver and manager or agent of a mortgagee in possession - Whether power analogous to examination powers historically exercised by courts in the winding up of companies - Whether power incidental to the exercise of judicial power - Chameleon doctrine
Legislation:
Companies (Western Australia) Code, s 541 Companies (Winding Up) Act 1890 (UK), s 7 Companies Act 1862 (UK), s 115, s 117, s 138 Companies Act 1893, s 157, s 159 Companies Act 1943 (WA), s 224, s 225, s 258 Companies Act 1961 (WA), s 249, s 250, s 274, s 367A, s 367C Companies Act Amendment Act 1969 (WA) Corporate Law Reform Act 1992 (Cth) Corporations Act 2001 (Cth), ch 5, pt 5.2, pt 5.4B, pt 5.5, pt 5.6, pt 5.9, s 423, s 423(1), s 424, s 477, s 477(6), s 479, s 479(3), s 488, s 506, s 511, s 532, s 536, s 596A, s 596B, s 597, s 1321 Corporations Law, s 596A, s 596B, s 597 Joint Stock Companies Ordinance 1858, s 62, s 77, s 79, s 80, s 88, s 92, s 97, s 98, s 105 Joint Stock Companies Winding Up Act 1844 (UK), s 15 Supreme Court…
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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AGLC
Saraceni v Jones [2012] WASCA 59
Case
[2012] WASCA 59
Decision Date
CaseChat Overview and Summary
In the matter of Saraceni v Jones, the primary issue before the court was the interpretation of a consent costs order, formulated and agreed upon by the parties after the delivery of a previous judgment. The respondents sought to claim costs under a costs agreement, arguing that the order allowed for indemnity costs, solicitor and client costs, or special costs. The court was tasked with determining whether the costs order denoted indemnity costs, or alternatively, solicitor and client costs, and whether it permitted the respondents to claim costs beyond the applicable costs scale item limit.
The court examined the principles governing indemnity costs and noted that the context, conduct of the proceedings, and terms of the costs order did not support an objectively determined intention to provide for indemnity costs. The court also considered the respondents' argument that the expression'reasonable costs incurred' should be construed to mean costs on a solicitor and client basis. However, the court found that neither the standard order for indemnity costs nor an order for costs reasonably incurred on a solicitor and client basis found support in the terms of the costs order.
The court concluded that the costs order did not denote indemnity costs or allow for costs to be claimed on a solicitor and client basis. The order only permitted the respondents to claim costs that were reasonable in the circumstances, subject to the maximum hourly and daily rates set out in the Legal Practitioners (Supreme Court) (Contentious Business) Determination 2010. Consequently, the respondents were not entitled to claim costs above the applicable costs scale item limit.
The court's decision clarified the interpretation of the costs order and provided guidance on the principles applicable to the making of indemnity costs orders. It reinforced the importance of considering the context and terms of the order when determining the scope of costs recoverable by the parties. The court's reasoning highlighted the need for a careful analysis of the language used in costs orders and the limitations imposed by relevant legislation and rules.
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
JUDGMENT OF THE COURT: This court is called upon to construe a costs order made by consent on 16 March 2012 (the costs order). The costs order was formulated, and agreed to, by the parties following the delivery of judgment in Saraceni v Jones [2012] WASCA 59 (the proceedings). The costs order provides that 'the Applicant pay the reasonable costs incurred by the Respondents in these proceedings to be taxed if not agreed'. The respondents have filed a bill of costs dated 1 November 2012 (the Bill). On 21 November 2012 Registrar Bush made orders by consent that the following questions raised by the applicant be determined by the court as a preliminary issue on the papers, being:(1)whether the costs order denotes indemnity costs (although not shifting the onus of proof), or in the alternative, solicitor and client costs; and(2)whether the costs order allows the respondents to claim costs above the applicable costs scale item limit. On 13 September 2011 Corboy J referred a special case for the opinion of the Court of Appeal. The Legal Practitioners (Supreme Court) (Contentious Business) Determination 2010 (the Determination ) applies to the proceedings. Item 22 of the Determination applies to a special case, case stated (otherwise than by way of appeal) or trial of an issue and allows for 'such amounts as are reasonable in the circumstances' (the scale item). The scale item is not capped. However, the maximum hourly and daily rates set out in the Table in cl 10 of the Determination would, absent an order to the contrary, apply in determining what was reasonable in the circumstances: Legal Profession Act 2008 (WA) (LPA), s 280; Rules of the Supreme Court 1971 (WA), O 66 r 11. The Bill claims costs pursuant to the provisions of a costs agreement between the respondents and law firm Blake Dawson dated 14 September 2011 (the costs agreement). The respondents claim that the costs order allows for costs to be claimed pursuant to the costs agreement on (1) an indemnity basis; (2) a solicitor and client basis; or (3) a special costs basis. In Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129 (S) the Court of Appeal summarised the well‑known principles applicable to the making of an indemnity costs order. Those well‑known principles provide the context in which the costs order is to be construed. Moreover, the standard order for indemnity costs is that 'X should pay all the costs incurred by Y except insofar as they are of an unreasonable amount or have been unreasonably incurred, so that, subject to the above exceptions, Y is completely indemnified by X for its costs': Re Bond Corporation Holdings Ltd (1990) 1 WAR 465, 479. The context, the conduct of the proceedings in the Court of Appeal and the terms of the costs order are inconsistent with an objectively determined intention to provide for indemnity costs. The respondents contend that the expression 'reasonable costs incurred' in the costs order should be construed to mean costs on a solicitor and client basis not a party and party basis. Reliance is placed upon criticism in Dal Pont GE, Law of Costs (2nd ed, 2009) at [15.39] of the decision in Spencer v Dowling [1997] 2 VR 127. The Victorian Court of Appeal in Spencer construed the expression 'costs reasonably incurred' in Victorian equal opportunity legislation to mean party and party costs not solicitor and client costs. The criticism is not persuasive. There is little if any practical difference between the standard order for indemnity costs and an order allowing costs reasonably incurred on a solicitor and client basis. Neither construction finds support in the terms of the costs order.
Ratio Decidendi
Legal Principle Established
Fourth, where a power is not peculiarly or distinctly legislative, executive or judicial, it may take its character from the character of the body in which the power is reposed (the 'chameleon' principle). As Kitto J observed in R v Spicer; Ex Parte Australian Builders' Labourers' Federation [1957] HCA 81; (1957) 100 CLR 277, (Builders' Labourers' case):Sometimes a grant of power not insusceptible of a judicial exercise is to be understood as a grant of judicial power because the recipient of the grant is judicial (305). The reasoning process by which that conclusion is drawn was explained by Kitto J in similar terms to those later used by Gleeson CJ in Thomas v Mowbray [12]. In short, the conferral of a power upon a court supports an inference that it was the intention of the legislature that the power be exercised in accordance with the usual characteristics of judicial power, which in turn lends support to the characterisation of the power as judicial in cases of doubt or uncertainty (see Builders' Labourers' (305); Thomas v Mowbray [59] (Gummow and Crennan JJ)). However, the chameleon principle must not be taken too far. The fact that the legislature chooses to confer a power upon a court cannot, of itself and without more, lead to the necessary conclusion that the power is properly characterised as judicial (Thomas v Mowbray [342] (Kirby J), [472] (Hayne J)). Otherwise the principles relating to the separation of powers implicit in the Australian Constitution, and enunciated in the Boilermakers' case, would have no practical application or effect. Fifth, the notion of judicial power is not confined to what is sometimes characterised as the function which lies at its core - namely, the adjudication of existing rights and obligations by applying the law to facts determined by the court. As Dixon CJ and McTiernan J observed in R v Davison [1954] ALR 877; (1954) 90 CLR 353, these core characteristics are 'entirely lacking from many proceedings falling within the jurisdiction of various courts of justice in English law' (368). The examples given by their Honours include the administration of assets or trusts, the making of orders with respect to the maintenance and guardianship of infants, the exercise of powers of sale by way of family arrangement, the provision of consent to the marriage of a ward of a court or a minor, the administration of enemy property in times of war, declarations of legitimacy and the winding up of companies. Many of these examples of judicial power have characteristics which might be seen as more akin to administrative powers or functions. Another example given by their Honours in R v Davison is the well‑established power of a court to make rules regulating its own procedure, which has characteristics which might be thought to be more akin to legislative power (369). The many examples of judicial power which do not involve the adjudication of existing rights and obligations, and the explicit recognition of the many powers which are not peculiarly and distinctly either legislative, administrative or judicial, and the chameleon principle, negate the proposition that judicial power is limited to what I have characterised as 'core' judicial power - namely, the adjudication of existing rights and obligations, augmented only by powers which are incidental or ancillary to that core power, or which are analogous to powers historically exercised by courts at or before the time of federation.