Smiths Detection (Australia) Pty Ltd v Basham (Costs)

In this case, Smiths Detection (Australia) Pty Ltd brought proceedings against Basham and others. The second to fourth defendants, referred to as the corporate defendants, successfully defended the plaintiff’s motion. They sought an order that the plaintiff pay their costs of the motion on the basis that costs should follow the event, which in this case was the dismissal of the plaintiff’s motion. The plaintiff argued that the costs of the motion should be costs in the cause of the overall proceedings as the motion was not sufficiently separate from the substantive proceedings to warrant an interlocutory costs order, and the plaintiff may yet be successful against the corporate defendants at a final hearing.

The court held that the plaintiff should pay the corporate defendants’ costs of the motion, as the motion was a discrete issue about striking out the corporate defendants’ defences and their success on that issue stands even if they end up losing the overall proceedings. The court found that by their victory, the corporate defendants won the right to maintain their defences at trial. The costs of the motion were held to include the costs of a short hearing in the Equity Duty List on 1 November 2019 dealing with a particular prayer of the plaintiff’s motion. Additionally, the court made an order that the corporate defendants’ costs of the motion are payable by the plaintiff forthwith, on the basis of the discrete nature of the motion and due to the lack of proximity to a final hearing.

The first defendant also sought an order for costs against the plaintiff, having successfully defended the plaintiff’s strike out motion. The plaintiff argued that it brought its motion because the first defendant destroyed or attempted to destroy documents in defiance of a court order, which constitutes disentitling conduct with respect to costs irrespective of the first defendant’s success in defending the motion. However, the court held that the plaintiff did not establish at the hearing of the motion that the first defendant succeeded in deleting the documents, only that he attempted to delete them. The court exercised its discretion by ordering that, although the first defendant succeeded in resisting the plaintiff’s motion, his costs of the motion are to be his costs in the cause of the substantive proceedings yet to be heard.