SG v New South Wales Crime Commission (No 3)

[2019] NSWSC 1906

Supreme Court

New South Wales

Medium Neutral Citation:

SG v New South Wales Crime Commission (No 3) [2019] NSWSC 1906

Hearing dates:

12 December 2018, 25 February, 3 May 2019

Date of orders:

31 December 2019

Decision date:

31 December 2019

Jurisdiction:

Common Law

Before:

Rothman J

Decision:

(1)   Orders already made, as at 3 May 2019, for the payment of costs are not varied;

 

(2)   The plaintiff shall pay the defendant’s costs of and incidental to responding to the plaintiff’s Notice to Produce of 9 October 2015;

 (3)   Costs of all matters, up to and including 3 May 2019, not otherwise the subject of an order for costs, shall be costs in the cause.

Catchwords:

COSTS – various motions – consent orders, except as to costs – discussion of principles and application to facts

Legislation Cited:

Crime Commission Act 2012 (NSW), s 80

Cases Cited:

ASIC v Rich [2003] NSWSC 297
Gambro Pty Ltd v Fresenius Medical Care Australia Pty Ltd [2002] FCA 581
Re Jay-O-Bees; Rosseau v Jay-O-Bees (2004) 50 ACSR 565; [2004] NSWSC 818
SG v New South Wales Crime Commission [2016] NSWSC 1615
SG v New South Wales Crime Commission (No 2) [2018] NSWSC 600

Category:

Costs

Parties:

SG (Plaintiff)
New South Wales Crime Commission (Defendant)

Representation:

Counsel:
S Hartford Davis (Plaintiff)
M Hutchings (Defendant)

  Solicitors:
Laxon Lex Lawyers (Plaintiff)
Crown Solicitor’s Office (Defendant)

File Number(s):

2015/194130

Publication restriction:

Publication restriction as to evidence or any material that would identify any individual mentioned in the proceedings, other than legal practitioners.

Judgment

1. HIS HONOUR: The Court is required to deal with the issue of costs as between the parties in relation to interlocutory issues that have arisen in relation to the filing of the Statement of Claim and various attempts to amend, as well as issues associated with one or more Notices to Produce and a Motion to strike out.

2. The matter was listed for hearing on the last occasion before the Court as presently constituted and the parties consented to orders that were then issued. The only issue that was outstanding on any Motion was the issue of costs, which the parties raised on 3 May 2019 and the Court determined that it would be dealt with on the papers.

3. Written submissions have been filed over an extended period and this judgment deals with the question of costs in relation to the interlocutory proceedings up to and including 12 December 2018.

4. The Court as presently constituted has previously set out a chronology of issues that have come before the Court. Unfortunately, it is necessary to recite some of that history, which has largely been summarised by the defendant in its written submissions.

Chronology

5. On 2 July 2015, SG commenced proceedings by Statement of Claim, alleging a number of causes of action that included breach of contract and negligence against the New South Wales Crime Commission (hereinafter “the Commission”) and claiming that the State of New South Wales (hereinafter “the State”) was liable for the acts and omissions of the Commission. The Statement of Claim was in bad form, which was determined somewhat later in the proceedings. The State has been removed as a defendant and the Commission is the only remaining defendant to the proceedings.

6. It is sufficient for present purposes to recite that SG claimed that he was a “source” for the Commission and entered into a contract for the payment for information and was not paid on the provision of that information.

7. On 9 October 2015, SG served a Notice to Produce seeking, amongst other things, an information report that was prepared in relation to SG by a senior employee of the Commission (hereinafter “JG”). On 23 October 2015, the Commission filed and served a Notice of Motion seeking the summary dismissal of the Statement of Claim and/or the proceedings.

8. On 23 October 2015, the Commission also served a Notice to Produce on SG, seeking, amongst other things, documents supplied by JG to SG or his solicitors for the period 1 July 2013 to date.

9. On 16 February 2016, a schedule of documents was served in response to the Notice to Produce served by the Commission on 23 October 2015, which claimed legal professional privilege over all of the documents within the class of documents sought to be produced.

10. On 21 March 2016, SG withdrew SG’s Notice to Produce. On 23 March 2016, the Commission served a Notice to Produce upon SG, seeking production of all the documents listed in the schedule of documents served on 16 February 2016.

11. On 8 April 2016, SG filed Motions seeking to set aside the Commission’s Notices to Produce and on the same date the matter was listed before the Court, as presently constituted, for Directions. The Motions were listed for hearing on 26 April 2016.

12. On 18 April 2016, the Commission served a further Motion seeking equitable relief in respect of SG’s proceedings.

13. On 26 April 2016, the matter was listed for Hearing of the Motion for summary disposal served by the Commission and the Commission’s application for equitable relief, as well as SG’s Motion of 8 April 2016, seeking to set aside the Notices to Produce of 23 October 2015 and 23 March 2016.

14. On 17 November 2016, the Court dismissed the Commission’s Motion for summary disposal and held that some of the documents held by SG could be the subject of legal professional privilege, but, as a class, that issue could not be determined in the absence of an inspection of the documents.

15. On 15 December 2016, the Commission filed a Summons seeking Leave to Appeal. On 21 December 2016, the State was removed as a party, by consent. On 15 March 2017, the proceedings were listed again before the Court, as presently constituted, for Directions, pending the Court of Appeal determination.

16. On 6 April 2017, the Court of Appeal heard the Commission’s Application for Leave to Appeal from the judgment of 17 November 2016. On 29 May 2017, the Court of Appeal dismissed the Appeal, refusing Leave to Appeal the interlocutory judgment.

17. The foregoing does not disclose the full extent of the submissions that were filed and/or pursued. There were, for example, constitutional issues associated with the validity of s 80 of the Crime Commission Act 2012 (NSW), which, on the proper construction of the aforesaid Act, the Court considered it unnecessary to decide: see SG v New South Wales Crime Commission [2016] NSWSC 1615 (hereinafter “the first judgment”).

18. Following the Court of Appeal judgment, the Court was requested to clarify some aspects of the judgment of 17 November 2016. The proceedings came before the Court, as presently constituted, on 15 March 2017.

19. During the course of those proceedings, counsel for the plaintiff, after apologising for the delay in applying to relist the matter, submitted that the next issue, with which the Court had contemplated dealing, was the detailed issue associated with which, if any, documents were privileged. He outlined that there had been a discussion between the parties that involved the Court deciding the question relating to the second Notice of Motion filed by the defendant, being the Motion of 8 April 2016 as amended, orally, at the Hearing on 26 April 2016, by the insertion of an additional prayer for relief, being [2A].

20. That relief sought that the defendant’s second Notice of Motion be struck out as it was, in effect, seeking relief in the nature of final relief and was, for that reason, bad in form: Re Jay-O-Bees; Rosseau v Jay-O-Bees (2004) 50 ACSR 565; [2004] NSWSC 818, per Campbell J. The parties agreed, at the Hearing on 15 March 2017, that, if the judgment of the Court was to dismiss the claim for equitable relief and grant the additional prayer in what was now [2A] of the plaintiff’s Motion, the issues associated with the legal professional privilege would fall away, at least for the time being.

21. The Court expressed some apprehension that the issues associated with the privilege would arise, and must necessarily arise, in the course of the proceedings, but was prepared to abide the agreement of the parties as to the procedure to be adopted.

22. On 7 May 2018, the Court, as presently constituted, issued the “clarification judgment”: SG v New South Wales Crime Commission (No 2) [2018] NSWSC 600 (hereinafter “the second judgment”). That judgment dismissed the Commission’s Motion seeking the exercise of the Court’s equitable jurisdiction. It ordered costs in relation to that Motion.

23. On 12 December 2018, the matter was listed before the Court, as presently constituted, on the application of the parties. At that hearing, there was a change of Solicitor for the defendant and orders were made and entered relating to the costs of the Motion on 12 December 2018 and further directions were issued in relation to the Amended Statement of Claim and other matters.

24. Pursuant to the directions, the orders made on 8 November 2018 were varied as to timetable and the matter was listed for further Directions on 20 March 2019. The parties applied to vacate the hearing on 20 March 2019 and to vary the timetable further, which the Court ordered in Chambers on 25 February 2019.

25. The matter was then listed for Directions on 3 May 2019. When the matter came before the Court on 3 May 2019, after hearing the parties, the Court made orders and/or directions that the plaintiff should serve a proposed Amended Statement of Claim by 4 PM 17 May 2019; directing the parties to confer as to the content of that proposed Amended Statement of Claim by 4 PM 22 May 2019; if there be no proposal to strike out the proposed Amended Statement of Claim, if sought to be filed, or paragraphs thereto, the Court to be informed and, likewise, if there is to be objection, the Court to be informed so as to fix a hearing date. The issue of costs was reserved.

26. As a result of the foregoing, there are outstanding issues of costs in relation to proceedings up to and including 3 May 2019 as to the amendments to the Statement of Claim; costs relating to the defendant’s response to the plaintiff’s Notice to Produce of 9 October 2015; and costs, not otherwise dealt with, relating to the Motion for summary dismissal, the strikeout Motion and the defendant’s Notice to Produce.

Principles

27. The discretion to award costs in proceedings must be exercised judicially, but is otherwise a broad discretion. Costs are not to be utilised for punishment, but are compensatory of the costs incurred as a result of proceedings taken and/or defended to enforce or defend one’s rights.

28. At final hearing, the ordinary rule is that costs follow the event, which applies to Motions that add to the costs of the proceedings generally. The foregoing are general rules, which give way to particular proceedings that, in the exercise of the Court’s discretion, ought be determined differently.

29. Thus, for example, there is often great dispute as to what is the “event” for the purpose of determining the application of the general law and it is clear that it does not necessarily extend to the whole of the proceedings, although it will generally. It may be determined on the basis of arguments on an issue-by-issue basis. However, having made that comment, the Court does not ordinarily apportion costs as between the different issues that may be raised, particularly where those issues were reasonably or necessarily raised in the course of the proceedings as a whole.

30. Different issues arise in relation to interlocutory orders. Where, as is the case in relation to the proceedings for the filing of Amended Statements of Claim, a party is seeking an indulgence which, thereby, causes additional costs to other parties, the party seeking the indulgence is, usually, responsible for the costs.

31. It has been held that the public interest in encouraging parties to compromise interlocutory proceedings requires that the Court should be careful or reluctant, when ordering costs of an interlocutory application that has been the subject of orders by consent: Gambro Pty Ltd v Fresenius Medical Care Australia Pty Ltd [2002] FCA 581, but, again, this is a general rule which must be subject to particular considerations: ASIC v Rich [2003] NSWSC 297.

Consideration

32. As at the times and dates of which the Court, as presently constituted, has knowledge, the plaintiff has yet successfully to file an Amended Statement of Claim. There have been a number of hearings associated with attempts to file an Amended Statement of Claim (or various drafts of same). To the extent that those attempts have caused the defendant to incur costs, the plaintiff should bear the cost and the plaintiff should pay the costs of the defendant.

33. As to the Commission’s strike-out Motions, these have already been the subject of costs and the Court will not vary those costs orders. As a consequence of the foregoing, there are two further aspects of the proceedings that should be the subject of costs or consideration of costs.

34. The first is the cost of the Commission in responding to the plaintiff’s Notice to Produce of 9 October 2015. That Notice to Produce was not pressed and the Commission’s costs of responding to it, which may be substantial, should be compensated. The withdrawal of the plaintiff’s Notice to Produce of 9 October 2015 was effected (and notified) only at the hearing. As a consequence, SG will be ordered to pay the Commission’s costs of and incidental to responding to the plaintiff’s Notice to Produce of 9 October 2015.

35. Lastly, there are the costs of the summary dismissal Motion, the strikeout Motion and the Commission’s Notices to Produce. The summary dismissal Motion in the strikeout Motion have in my view already been the subject of costs orders and will not be the subject of further costs orders, save for what follows. The Commission’s Notices to Produce are matters that will, ultimately, have to be determined and are yet to be determined. Further, they are necessary aspects of the proceedings that are in place.

36. In my view, the costs of the summary dismissal Motion, and the strikeout Motion, that have not otherwise been the subject of costs orders should be costs in the cause as should the Commission’s Notices to Produce.

37. The Court will make the following orders:

1. Orders already made, as at 3 May 2019, for the payment of costs are not varied;

2. The plaintiff shall pay the defendant’s costs of and incidental to responding to the plaintiff’s Notice to Produce of 9 October 2015;

3. Costs of all matters, up to and including 3 May 2019, not otherwise the subject of an order for costs, shall be costs in the cause.

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Decision last updated: 03 January 2020