Skalkos v Gebski (No 2)

[2012] SASC 36

SUPREME COURT OF SOUTH AUSTRALIA

(Land and Valuation Division)

SKALKOS & ANOR v GEBSKI & ORS (No 2)

[2012] SASC 36

Judgment of The Honourable Justice Anderson

15 March 2012

PROCEDURE - COSTS - GENERAL RULE - COSTS FOLLOW THE EVENT - COSTS OF ISSUES

The successful defendants applied for its costs – whether costs should follow the event pursuant to r 263(1) of the Supreme Court Civil Rules 2006 (SA) – whether exceptions to the general rule applied pursuant to r 264 – the plaintiffs seek an order that each party bear their own costs.

Held: The general rule that costs follow the event applies – no proper basis to depart from the normal rule – costs awarded in favour of the defendants.

Encroachments Act 1944 (SA) s 10(2); Supreme Court Civil Rules 2006 (SA) r 263(1) and r 264, referred to.
Donald Campbell and Company, Limited v Pollak [1927] AC 732; Ritter v Godfrey [1920] 2 KB 47; Edmund v Martell (1907) 24 Times LR 25, discussed.
Skalkos & Anor v Gebski & Ors [2011] SASC 213, considered.

SKALKOS & ANOR v GEBSKI & ORS (No 2)
[2012] SASC 36

Land and Valuation Division

1. ANDERSON J. On 9 December 2011 I delivered judgment in this matter. Pursuant to s 10(2) of the Encroachments Act 1944 (SA) I fixed the true boundary between the parties’ properties as determined by Mr Bested in his survey DP 83065. Judgment was entered in favour of the defendants: see Skalkos & Anor v Gebski & Ors [2011] SASC 213.

2. I will now deal with the question of costs in this action.

   Discretion as to costs

3. Pursuant to r 263(1) of the Supreme Court Civil Rules 2006 (SA), as a general rule costs follow the event. Mr Henry SC for the defendants argues that the defendants have been the successful party in the litigation and thus in accordance with the general rule the unsuccessful party, being the plaintiffs, should pay the costs of the successful defendants.

4. Mr Stevens, counsel for the plaintiffs, submits that pursuant to r 264 the general rule is always subject to the discretion of the court to award costs on any basis the court thinks fit. He argues that each party should bear its own costs of the action. He raised a number of factors which he submitted should be considered in the exercise of such a discretion.

5. Mr Henry submits that the circumstances in which the court might exercise its discretion to disentitle a successful defendant from costs are limited.

   Arguments

6. I will briefly set out the arguments submitted.

7. Mr Stevens contends that the plaintiffs were forced to take out an application for injunction because of the provocative action of the defendants. This included tampering with Mr Skalkos’ footings, not responding to Mr Wadlow’s letter of 11 February 2010, and communications between Mr Skalkos and the defendants’ workmen regarding the laying of footings on part of Mr Skalkos’ land.

8. The letter of 11 February 2010 complains of a trespass on Mr Skalkos’ land. It refers to the survey of Mr Bested and disputes the accuracy of it.

9. After referring to how disputes between surveyors might be resolved, the plaintiffs’ demand that the defendants cease all works. It sought an undertaking to cease the work and threatened a Supreme Court action for injunctive relief.

10. Mr Henry argued that the fact that there was no formal or informal response to the Wadlow letter of 11 February 2010 is not enough to bring the plaintiffs within the recognised categories in which a successful defendant would be denied costs. He relies on Donald Campbell and Company, Limited v Pollak [1927] AC 732 at 814-815 where Lord Atkinson sets out a passage from Lord Sterndale MR in Ritter v Godfrey [1920] 2 KB 47 at 53 as follows:

    Speaking generally, I think it may be said that, in order to justify an order refusing a defendant his costs, he must be shown to have been guilty of conduct which induced the plaintiff to bring the action, and without which it would probably not have been brought.

    Lord Atkinson says at 814:

    My Lords, I think this judgment of Lord Sterndale contains a clear, condensed and accurate statement of the law and of the prevailing practice on the points with which it deals.

    Lord Atkinson also relies at 821 on Lord Justice Buckley in Edmund v Martell (1907) 24 Times LR 25 where Lord Justice Buckley says at 26:

    The facts upon which a judge could exercise his discretion in depriving a successful litigant of costs must be facts relevant to the question to be adjudicated upon as between the plaintiff and the defendant. The judge had no power to deprive the successful litigant of costs because in some matter not material he might think that that party should have behaved, say, with more courtesy or consideration. These were not matters upon which the Court could act.

11. Mr Henry argues that at the time when the proceedings were issued, the plaintiffs knew there was a dispute between the surveyors and wished to litigate the question of which survey was accurate. He further submits that the defendants made it clear to the plaintiffs that they were going to rely on their registered survey and continue to build. Therefore the defendants’ failure to respond to the Wadlow letter did not induce the plaintiff to enter into litigation that it would not otherwise have done.

12. Mr Stevens argued that the defendants, prior to the commencement of the proceedings, did not bring to the plaintiffs’ attention that the sub-division process was still proceeding and that two new titles had been issued for Mr Gebski’s land.

13. In relation to the plaintiffs’ submission that they were not told of the new titles that had been issued, Mr Henry stated that the plaintiffs should not try to avoid a costs order because of their own lack of research.

14. A search of the title was conducted by the plaintiffs on 2 February 2010. The new titles were issued on 3 February 2010. The application for the injunction and the issuing of the proceedings took place on 13 March 2010. After 2 February 2010, the plaintiffs did not conduct a further search of the title and issued the application for an injunction without rechecking the titles.

15. In my experience, it is common practice by lawyers to always recheck the status of titles before issuing proceedings. The plaintiffs should have rechecked the title before issuing an injunction. Had they done so, they would have learnt of the proposed subdivision.

    Factual Disputes

16. There are a number of factual disputes which have arisen from affidavits filed earlier in the proceedings and more recently. These are, first, whether the plaintiffs gave the defendants a copy of the Burford survey prior to the issuing of proceedings and, second, the fact that Mr Skalkos did not respond to the recently filed affidavits.

17. Mr Henry submits that these factual disputes, even taken at their most favourable to the plaintiffs, do not justify departure from the general rule.

18. Mr Stevens argued that having identified there was a problem, Mr Skalkos referred the matter to the Surveyor-General. The Surveyor-General declined to take any action.

19. In my reasons I describe the actions of the defendants in commencing to lay footings on Mr Skalkos’ land as “provocative and heavy handed”. My attention has now been drawn to the affidavits filed by the defendants Tomek Gebski and Rosemary Fuda of 13 May 2010 which depose to the fact that Mr Skalkos recognised that the boundary was most likely in the wrong position. The plaintiffs had ample time to respond to those affidavits and chose not to. In a dispute on costs, Mr Skalkos’ lack of response is significant in the exercise of my discretion. He has not disputed the assertions that he had conversations with the defendants acknowledging that he thought the boundary was in the wrong place.

    Land Title Office and Survey Practices

20. Mr Stevens submitted that the boundary was uncertain because of a lack of clear principles in the various guidelines available to surveyors. I do not agree with this. As I have found, one survey, that of Mr Bested, was based on recognised surveying principles and registered. The other survey (relied on by Mr Stevens) sought to argue from principles of possession that the boundary was correct and that the registered survey should be set aside.

21. Mr Stevens argues that this was a bona fide action in which the plaintiffs have always sought to resolve the matter, initially through the Surveyor-General, then to have it resolved by the surveyors in conference and finally, having failed attempts both formally and informally to resolve the boundary dispute, seeking determination by the court.

22. Each of these submissions must be looked at having regard to the fact that Mr Skalkos has not challenged the statements which show that he was uncertain, at best for him, as to the true boundary. I consider that Mr Skalkos did know and understand that it was likely that there was a significant encroachment at the rear of his property and proceeded, notwithstanding that, to issue the proceedings.

    Conclusion

23. In my view the normal rule that costs follow the event should apply. There is no argument advanced by Mr Stevens which causes any departure from this rule. This is not a case where the successful party should be deprived of its costs. Therefore the defendants’ costs of the action are to be paid by the plaintiffs.