Sharkey v Nissi (No 3) - [2016] NSWSC 1648

Supreme Court

New South Wales

Medium Neutral Citation: Sharkey v Nissi (No 3) [2016] NSWSC 1648
Hearing dates: On the papers
Date of orders: 22 November 2016
Decision date: 22 November 2016
Jurisdiction: Equity
Before: Robb J
Decision:
Order the cross claimant to pay the second cross defendant’s costs of the cross claim on the ordinary basis.

Catchwords: COSTS – costs of cross claim– second cross defendant sought indemnity costs – whether the cross claim had no chance of success – cross claim formulated on a mistaken basis – however, the second cross defendant appreciated this mistake – HELD cross claimant to pay the second cross defendant’s cost on the ordinary basis
Cases Cited: Birch v Glissen Pty Ltd [2005] NSWSC 337
Danthanarayana v Commonwealth of Australia [2016] FCAFC 114
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397
Sharkey v Nissi [2015] NSWSC 1266
Sharkey v Nissi (No 2) [2016] NSWSC 1147
Category: Costs
Parties: Christopher James Sharkey (plaintiff/first cross defendant)
Donya Mayahi-Nissi (defendant/cross claimant)
Sharkey Family Trust Pty Ltd (ACN 122 270 286) (second cross defendant)
Representation:
Counsel: A Fernon (plaintiff)
D L Cook (defendant)
Solicitors: Swaabs (plaintiff)
Eakin McCaffery Cox (defendant)

File Number(s): 2013/383023
Publication restriction: None

Judgment

I delivered my principal reasons for judgment in these proceedings on 2 September 2015: Sharkey v Nissi [2015] NSWSC 1266.
By order 4, I dismissed the cross claim made by Ms Nissi against the trustee of Mr Sharkey’s family trust, Sharkey Family Trust Pty Ltd, who I called the “Trustee”.
On 16 June 2016, Ms Nissi filed a notice of motion seeking leave to amend her cross claim against the Trustee to assert a different legal basis for her claim against the Trustee than was pleaded in the original cross claim.
On 8 November 2016, I delivered reasons for judgment in which I dismissed Ms Nissi’s application to amend her cross claim against the Trustee: Sharkey v Nissi (No 2) [2016] NSWSC 1147. I ordered Ms Nissi to pay the Trustee’s costs of the notice of motion.
By order 6 made on 2 September 2015, I directed the parties to confer about the orders for costs that should be made. It is sufficient to note that the only costs order that now remains outstanding is the order that should be made in respect of the dismissal of Ms Nissi’s cross claim against the Trustee.
Ms Nissi now accepts that, in conformity with the usual approach where a party fails in a claim made against another party, Ms Nissi should be ordered to pay the costs of her cross claim against the Trustee. She submits that the costs order should be on the ordinary basis.
I gave the parties leave to deliver written submissions on the terms of the costs order that should be made.
Ms Nissi did not avail herself of this leave, as she decided that she should accept that the court will order her to pay the Trustee’s…

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 Sharkey v Nissi (No 3)

Details

AGLC: Sharkey v Nissi (No 3) [2016] NSWSC 1648
Case: [2016] NSWSC 1648
Decision Date: 22 November 2016

CaseChat Overview and Summary

The case of Sharkey v Nissi (No 3) involved a dispute between multiple parties in the Supreme Court of Victoria. The second cross defendant sought indemnity costs from the cross claimant, arguing that the cross claim had no chance of success due to being based on a mistaken premise. Despite acknowledging the mistake, the court had to determine the appropriate costs to be awarded. The legal issues before the court included whether the cross claim was doomed to fail and whether the second cross defendant was entitled to indemnity costs as a result.

The court considered the circumstances under which indemnity costs could be awarded. It found that, although the cross claim was based on a mistaken premise, the second cross defendant had appreciated the mistake. This understanding meant that the cross claim was not entirely without merit and did not meet the stringent criteria for indemnity costs. The court held that the cross claimant should bear the costs of the second cross defendant on the ordinary basis, reflecting the nature of the cross claim and the parties' respective positions.

The court's reasoning was grounded in the principles of costs in equity and the need to balance the interests of the parties. By holding that the cross claimant should pay the second cross defendant's costs on the ordinary basis, the court ensured that neither party was unjustly enriched or impoverished. This outcome recognised the cross claimant's error but also the second cross defendant's awareness of this error, thereby maintaining fairness in the allocation of costs.

The final orders of the court mandated that the cross claimant pay the second cross defendant's costs on the ordinary basis. This decision reflects the court's balanced approach to costs in cases where a cross claim is based on a mistaken premise, but the claimant is aware of the mistake. The outcome provides a clear guideline for similar future disputes and maintains the integrity of the legal process.

Orders