Souter v Condor Developments Pty Ltd

Case [2012] WASCA 227

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT :   THE COURT OF APPEAL (WA)

CITATION:   SOUTER -v- CONDOR DEVELOPMENTS PTY LTD [2012] WASCA 227

CORAM:   BUSS JA

NEWNES JA
MURPHY JA

HEARD:   20 SEPTEMBER 2012

DELIVERED          :   9 NOVEMBER 2012

FILE NO/S:   CACV 14 of 2012

BETWEEN:   CALLAN GEORGE SOUTER

Appellant

AND

CONDOR DEVELOPMENTS PTY LTD
Respondent

ON APPEAL FROM:

Jurisdiction              :  DISTRICT COURT OF WESTERN AUSTRALIA

Coram  :O'NEAL DCJ

Citation  :SOUTER -v- CONDOR DEVELOPMENTS PTY LTD [2011] WADC 212

File No  :CIV 891 of 2010

Catchwords:

Practice and procedure - Costs - Appellant (plaintiff) succeeded in part at trial - No order as to costs - Whether appellant entitled to portion of costs - Application of O 66 r 1(3), O 66 r 2(a), Rules of the Supreme Court 1971 (WA)

Practice and procedure - Pre­judgment interest - Supreme Court Act 1935 (WA), s 32 - Whether appellant entitled to interest from breach of contract or trial

Legislation:

Rules of the Supreme Court 1935 (WA), O 66 r 1(1), O 66 r 1(3), O 66 r 2(a)
Supreme Court Act 1935 (WA), s 32

Result:

Appeal allowed
Respondent to pay 50% of appellant's costs of the action
Respondent to pay interest on judgment sum from trial to judgment

Category:    B

Representation:

Counsel:

Appellant:     Mr D H Solomon

Respondent:     Mr D J Garnsworthy

Solicitors:

Appellant:     Solomon Brothers

Respondent:     Park Linfoot Legal Solutions

Case(s) referred to in judgment(s):

Amaca Pty Ltd (formerly James Hardie & Co Pty Ltd) v Hannell [2007] WASCA 158 (S)

Apache Northwest Pty Ltd v Department of Mines and Petroleum [2012] WASCA 167

Bowen v Alsanto Nominees Pty Ltd [2011] WASCA 39 (S)

Cardno BSD Pty Ltd v Water Corporation [No 2] [2011] WASCA 161

Collins v Westralian Sands Ltd (1993) 9 WAR 56

Cox v McDonald (Unreported, WASCA, Library No 9103, 14 October 1991)

Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd (1993) 26 IPR 261

Fire and All Risks Insurance Co Ltd v Callinan [1978] HCA 31; (1978) 140 CLR 427

Grincelis v House [2000] HCA 42; (2000) 201 CLR 321

Haines v Bendall [1991] HCA 15; (1991) 172 CLR 60

House v The King (1936) 55 CLR 499

Johnson v Perez [1988] HCA 64; (1988) 166 CLR 351

Keet v Ward [2011] WASCA 139

Permanent Building Society v Wheeler [No 2] (1993) 10 WAR 569

Phillips Fox (A Firm) v Westgold Resources NL [2000] WASCA 85

Rio Tinto Exploration Pty Ltd v Graphite Holdings Pty Ltd [2007] WASCA 276

Souter v Condor Developments Pty Ltd [2011] WADC 212

Souter v Condor Developments Pty Ltd [2011] WADC 212 (S)

  1. BUSS JA:  I agree with Newnes JA.

  2. NEWNES JA: This is an appeal against orders in respect of costs and pre‑judgment interest made after trial in the District Court by O'Neal DCJ.

  3. The appeal arises out of proceedings which the appellant brought against the respondent claiming damages for breach of a contract for…

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Souter v Condor Developments Pty Ltd [2012] WASCA 227
Case
[2012] WASCA 227
Decision Date

CaseChat Overview and Summary

In the appeal Souter v Condor Developments Pty Ltd, the appellant (plaintiff) sought to overturn a decision of O'Neal DCJ, which ruled that there should be no order as to the costs of the trial and that the appellant was not entitled to interest on the damages of $72,000 awarded. The appellant argued for an entitlement to half of his costs of the action and interest on the judgment sum from the end of the trial. The respondent argued for no order as to the costs of the appeal or, alternatively, that the appellant should be entitled to only a portion of his costs. The respondent also cross-appealed, arguing that the appellant had not taken sufficient steps to proceed with the appeal.

The court examined the application of O 66 r 1(3) and O 66 r 2(a) of the Rules of the Supreme Court 1971 (WA), and the Supreme Court Act 1935 (WA), s 32. The court noted that the appellant had a wide discretion in determining costs but highlighted exceptions, including the power to order a party to pay costs for issues on which they had failed. The court also considered the appellant's success on the issues he raised, which necessitated the canvassing of all relevant material. The court found that the appellant was entitled to an order for half of his costs of the action and interest on the judgment sum from the end of the trial. The court also observed an anomaly regarding the requirement of leave to appeal costs from the District Court, a matter previously noted in previous judgments.

The appeal was allowed, and the appellant was granted half of his costs of the action and interest on the judgment sum from the end of the trial. The respondent's cross-appeal was dismissed. The court ordered that the appellant should recover its costs of the appeal.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

JUDGMENT OF THE COURT: On 9 November 2012, we allowed an appeal against a decision of O'Neal DCJ, who had decided there should be no order as to the costs of the trial and that the appellant (plaintiff) was not entitled to interest on the damages of $72,000 which he was awarded by his Honour. We found that the appellant was entitled to an order for half of his costs of the action, having regard to the extent of his success on the issues he advanced in support of his claim, and to interest on the judgment sum from the end of the trial, rather than from the date of the respondent's breach of the contract as the appellant sought. When judgment was delivered the respondent sought an opportunity to make submissions on the costs of the appeal. Accordingly, directions were given for the filing of written submissions and it was ordered that the question of costs be decided on the papers. Those written submissions were subsequently filed. It was submitted by the respondent that there should be no order as to the costs of the appeal or alternatively that the appellant is entitled to only a portion of his costs. That, it was argued, was because, in the result, the appellant was successful to the extent of only about half the amount claimed by way of costs and interest respectively. On the respondent's cross‑appeal, the respondent says that no steps were taken in the cross‑appeal beyond the filing by the respondent of a notice of intention to appear on the appeal, on which it ticked the box indicating that it intended to cross‑appeal. That notice was filed on 7 March 2012. Nothing further occurred in the cross‑appeal and, on 18 May 2012, the respondent's solicitors wrote to both the court and the appellant's solicitors to say that the respondent was not proceeding with the cross‑appeal. No grounds of cross‑appeal were ever filed or served. The appellant's position is that while he recovered less than he sought, he was successful in respect of both issues on the appeal. All of the matters raised in relation to the costs of trial were necessary in order for this court to determine the appropriate portion of costs to which the appellant was entitled. There was, therefore, nothing, by way of wasted costs. On interest, once the question of whether interest should run from trial was raised by the court, the appellant did not press for interest from the breach. Again, there were no wasted costs. The appellant should therefore recover its costs of the appeal. The relevant authorities on costs have been canvassed in the primary judgment and it is unnecessary to repeat them. While it is the case that on the appeal the appellant recovered only something in the order of half the amounts he sought, the respondent resisted the entitlement of the appellant to any costs or interest at all. Had the appellant pitched his claim on the appeal at the level at which he was ultimately successful, it would still have been necessary to canvass much of the same material and it is difficult to see how there would have been any significant saving in costs.

Ratio Decidendi

Legal Principle Established

Before turning to the grounds of appeal, I should mention that leave to appeal from the order as to costs is not required in this case because the appeal is from a decision of a judge of the District Court: see Cardno BSD Pty Ltd v Water Corporation [No 2] [2011] WASCA 161 [9] ‑ [11], [98] ‑ [102]. That highlights a long‑standing anomaly. If the appeal had been brought from a decision of a judge of the general division of this court, leave to appeal would have been required by virtue of s 60(1)(e) of the Supreme Court Act 1935 (WA). Section 60(1)(e) provides, in effect, that no appeal lies from an order of a judge or master 'as to costs only', except with the leave of the judge or master or of this court. (An appeal against a costs order is an appeal 'as to costs only' notwithstanding that it is brought together with another, unrelated, ground of appeal: see Apache Northwest Pty Ltd v Department of Mines and Petroleum [2012] WASCA 167 [105]). There is, however, no statutory requirement equivalent to s 60(1)(e) of the Supreme Court Act in relation to an appeal as to costs from a decision of the District Court. This anomaly has been the subject of comment previously by this court. It was raised more than 20 years ago in Cox v McDonald (Unreported, WASCA, Library No 9103, 14 October 1991) and again in Collins v Westralian Sands Ltd (1993) 9 WAR 56, 58 ‑ 59, where Malcolm CJ called for legislative action. More recently, in Cardno, Martin CJ expressed regret that the legislature had not taken steps to bring appeals as to costs from the District Court into line with such appeals from the general division of this court [9] ‑ [11]. I would respectfully endorse his Honour's comments (as I did in Cardno at [12]). The object of limiting such appeals by requiring that leave be obtained applies with no less force to appeals from the District Court. The present position has no basis in principle or logic and can only be explained as a legislative oversight. I turn to the grounds of appeal. It is trite law that the court has a very wide discretion as to costs, albeit it is a discretion to be exercised judicially. The general rule is that a successful party is entitled to an order for costs: O 66 r 1(1), Rules of the Supreme Court 1971 (WA). There are, however, two well‑established exceptions to that rule to which it is necessary to refer. First, where a party, although generally successful, has failed on some issue or issues which increased the costs of the action, the court may order the party to pay the costs of those issues: O 66 r 1(3). But that is a power to be exercised with caution and not as a matter of course. While parties should be encouraged to litigate only those matters which are properly and reasonably in issue, parties should not be dissuaded by the risks of an adverse costs order from canvassing all issues which might be material to the proper determination of a case: Keet v Ward [18]. Moreover, any practice of determining costs on the basis of a painstaking analysis of which party won on which issue would simply add to the time, costs and uncertainty of litigation: see Bowen v Alsanto Nominees Pty Ltd [2011] WASCA 39 (S) [6]. Such an approach may also fail to do justice in cases where the issues were intertwined or overlapped, or there was only one substantive issue. The exercise of the power to adjust an order for costs by reference to particular issues upon which an otherwise successful party has failed will ordinarily be appropriate only where the party has failed on discrete and severable issues which have added to the costs of the action in a significant and readily discernible way: Amaca Pty Ltd (formerly James Hardie & Co Pty Ltd) v Hannell [2007] WASCA 158 (S) [7].