District Court
New South Wales
Medium Neutral Citation: Shaw v Niru Construction Pty Ltd & Anor (No.3) [2021] NSWDC 624 Hearing dates: On the papers Date of orders: 18 November 2021 Decision date: 18 November 2021 Jurisdiction: Civil Before: Abadee DCJ Decision: See paragraph 27
Catchwords: COSTS – multiple defendants – plaintiff successful against company first defendant only – whether plaintiff should pay costs of director second defendant where same legal representatives were retained – application for Sanderson order – application for exemption from statutory cap for costs
Legislation Cited: Legal Profession Uniform Law Application Act 2014 (NSW) s 2, Sch 1 cl 6
Cases Cited: Currabubula Holdings Pty Ltd v State Bank of NSW [2000] NSWSC 232
King Network Group Pty Ltd v Club of the Clubs Pty Ltd (No.2) [2009] NSWCA 204
Korner v H Korner & Co Ltd [1951] Ch 10
McCausland v Surfing Hardware International Holdings Pty Ltd (No.3) [2014] NSWSC 590
Shaw v Niru Construction Pty Ltd & Anor [2021] NSWDC 589
Shaw v Niru Construction Pty Ltd & Anor (No.2) [2021] NSWDC 600
Wardle v Agricultural and Rural Finance Pty Ltd [2012] NSWCA 388
Texts Cited: Nil
Category: Costs Parties: Robin Shaw (plaintiff)
Niru Construction Pty Ltd (first defendant)
Arasaratnam Mahendran (second defendant)Representation: Counsel:
Solicitors:
Ms E Welsh for the plaintiff
Mr A Renshaw for the first and second defendants
Brydens Lawyers for the plaintiff
McMahons Lawyers first and second defendants
File Number(s): 2020/00032476 Publication restriction: Nil
Judgment
Background
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On 5 November 2021, I ordered judgment in favour of the plaintiff against the first defendant for the sum of $54,540.32 but also ordered judgment for the second defendant against the plaintiff[1] . This followed a 4-day trial during which the defendants unsuccessfully applied for an adjournment of the hearing on the penultimate day[2] . After expressing commentary on the subject of costs, I reserved the question of costs to enable the parties to make submissions. Both parties supplied written submissions, although the plaintiff forewent the opportunity of supplying written submissions in reply to the defendants’ written submissions.
1. Shaw v Niru Constructions Pty Ltd & Anor (No.2) [2021] NSWDC 600 (the ‘Liability judgment’)
2. Shaw v Niru Constructions Pty Ltd & Anor [2021] NSWDC 589 (the ‘Adjournment Judgment’)
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The plaintiff applied for the following orders on costs:
Subject to order 3, the first defendant should pay the plaintiff’s costs on the ordinary basis (as agreed or assessed);
A Sanderson order, whereby the first defendant pay the second defendant’s costs;
The plaintiff’s costs of the hearing on 29 October 2021 should be excluded from the operation of Schedule 1 of the Legal Profession Uniform Law Application Act 2014 (NSW) (the LPULA Act).
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The defendants (jointly) submit that the appropriate costs orders are:
The first defendant pay the plaintiff’s costs on the ordinary basis; and
The plaintiff pay the second defendant’s costs on the ordinary basis.
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In its opposition to the Sanderson order, the defendants raised an anterior question concerning…
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- Case
- [2021] NSWDC 624
- Decision Date
CaseChat Overview and Summary
The court was required to decide whether the plaintiff could recover his costs from Mr. Patel, who was a defendant in the proceedings but not the primary party against whom the plaintiff had succeeded. The court also needed to determine whether the plaintiff's application for exemption from the statutory cap on costs was justified. The court considered the principles of costs in Australian litigation, including the general rule that the losing party pays the costs of the winning party, and the exceptions to this rule, such as the Sanderson order. The court also considered the relevant statutory provisions and the factors that should be taken into account in determining whether to grant an exemption from the statutory cap on costs.
The court held that the plaintiff could recover his costs from Mr. Patel under a Sanderson order, as Mr. Patel, as a director of the company, was responsible for the company's actions and should be held accountable for the costs of the litigation. The court also held that the plaintiff's application for exemption from the statutory cap on costs was justified, as the amount of costs incurred was reasonable and necessary in the circumstances of the case. The court considered the complexity of the litigation, the need to ensure that the company's director was held accountable for his actions, and the importance of deterring similar conduct in the future. The court concluded that the plaintiff was entitled to recover his costs from Mr. Patel and that an exemption from the statutory cap on costs was appropriate in the circumstances.
The final orders of the court were that the plaintiff was entitled to recover his costs from Mr. Patel under a Sanderson order, and that the plaintiff's application for exemption from the statutory cap on costs was granted. The court also made orders for the payment of the plaintiff's costs and for the assessment of those costs.
Orders
Orders of the court
See paragraph 27
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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