Steer v AMP Life Limited & AMP Superannuation Ltd (No 2) - [2021] SADC 155

DISTRICT COURT OF SOUTH AUSTRALIA

(Civil)
STEER v AMP LIFE LIMITED & AMP SUPERANNUATION LTD (No 2)
[2021] SADC 155
Decision of his Honour Judge Burnett
20 December 2021
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - GENERAL RULE: COSTS FOLLOW EVENT
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - INDEMNITY COSTS
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - PARTIES AND NON-PARTIES - COSTS IN PROCEEDINGS WHERE MULTIPLE PARTIES - COSTS AGAINST ONE OF SEVERAL DEFENDANTS: BULLOCK AND SANDERSON TYPE ORDERS
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - PARTIES AND NON-PARTIES - COSTS IN PROCEEDINGS WHERE MULTIPLE PARTIES
At trial, the Court ordered that the applicant was entitled to judgment in his favour against the second respondent, AMP Superannuation Ltd (AMP Super), for the amount claimed, being the sum of $286,048 inclusive of pre-judgment interest. The claim of the applicant against the first respondent AMP Life Ltd (AMP Life) was dismissed.
The applicant sought indemnity costs against AMP Super. The applicant also sought, if appropriate, a Bullock or Sanderson Order, in respect of any costs that it might be ordered to AMP Life. AMP Life sought its costs of the action until 5 November 2020 when it was the only party to the proceedings. On 5 November 2020 an order was made joining AMP Super to the proceedings. After 5 November 2020, AMP Life seeks 50% of its costs on a party and party basis. AMP Super submitted that no order for costs should be made against it or alternatively it should only pay 25-30% of the costs of the applicant, again on a party and party basis. AMP Super made this contention because of the conduct of the applicant in pursuing numerous unsuccessful courses of action.
AMP Life and AMP Super were represented by the same counsel and same solicitors. AMP Super was, at the relevant time, a wholly owned subsidiary of AMP Life.
The applicant brought the proceedings as the trustee of the estate of Carolyn Christina Burns (the Deceased) as a member of the superannuation fund of which AMP Super was trustee. As a member of the superannuation fund, the Deceased had an interest in the Group Life Insurance Policy which AMP Super held with AMP Life. That policy was cancelled by AMP Super following the introduction of the Treasury Laws Amendment Act (Protecting Your Superannuation Package) 2019 (Cth).
Held:
1. In this case, justice between the parties as to costs was best achieved by an aggregated approach to the respondents and the causes of action: Howards Storage World Pty Ltd v Haviv Holdings Pty Ltd (2010) 182 FCR 84 applied; Rasch Nominees Pty Ltd v Bartholomaeus & Ors (No 3) [2013] SASC 14 applied. The principle of apportionment or the rule of thumb did not provide a just outcome in the circumstances of this case.
2.      The applicant was entitled to its costs against AMP Super on a party and party basis and not on an indemnity basis. There was no reason advanced by the applicant as to why indemnity costs should be awarded in his favour.
3.      The applicant is only entitled to costs against AMP Super from 5 November 2020 when an order was made joining AMP Super as a respondent to the proceedings.
4. It is appropriate to make such a deduction for costs because of the numerous causes of action brought by the applicant against AMP Super and AMP Life which did not succeed. There is a general reluctance for courts to deal with costs on an issue by issue basis: Firebird Global Master Fund II Ltd v Republic of Nauru (No 2) (2015) 327 ALR 192 referred to. In certain circumstances it is appropriate to made a deduction to the costs that would otherwise be payable to the applicant. One of those circumstances is where time is wasted on the unsuccessful causes of action. ACCC v CFMEU (No 4) [2018] FCA 684; Macks v Viscariello (No 2) [2018] SASCFC 106 applied. There is an advantage for the court to make a percentage costs order rather than two costs orders: Aussiegolfa Pty Ltd as Trustee of the Benson Family Superannuation Fund v Commissioner of Taxation (No 5) (2018) FCAFC 156; Lessses v Maras No (3) [2017] SASCFC 154 applied.
5.      There should be a reduction of 20% of the applicant’s costs for wasted time associated with the unsuccessful causes of action.
6.      There is no basis or need for a Sanderson or Bullock Order with the aggregate approach taken to the respondents and the causes of action.
7.      AMP Life is entitled to its costs against the applicant until 5 November 2020 when it was the only respondent to the proceedings. Otherwise, it is not entitled to its costs.
Treasury Laws Amendment Act (Protecting Your Superannuation Package) 2019 (Cth); Competition and Consumer Act 2010 (Cth); Insurance Contracts Act 1984 (Cth) s 13, 14, 48A; Corporations Act 2001 (Cth); District Court Act 1991 (SA) s 42; Uniform Civil Rules 2020 (SA) s 194.5, referred to.
Howards Storage World Pty Ltd v Haviv Holdings Pty Ltd (2010) 182 FCR 84; Rasch Nominees Pty Ltd v Bartholomaeus & Ors (No 3) [2013] SASC 14; ACCC v CFMEU (No 4) [2018] FCA 684; Macks v Viscariello (No 2) [2018] SASCFC 106; Aussiegolfa Pty Ltd as Trustee of the Benson Family Superannuation Fund v Commissioner of Taxation (No 5) (2018) FCAFC 156; Lessses v Maras No (3) [2017] SASCFC 154, applied.
Firebird Global Master Fund II Ltd v Republic of Nauru (No 2) (2015) 327 ALR 192; Currabula Holdings Pty Ltd v State Bank of New South Wales [2000] NSWSC 232; Rasch Nominees Pty Ltd v Bartholomaeus [2013] SASCFC 105; King Network Group Pty Ltd v Club of the Clubs Pty Ltd (No 2) [2009] NSWCA 204; James v Royal Bank of Scotland; McKeith v Royal Bank of Scotland (No 2) [2015] NSWSC 970; Chen v Chen (No 2) [2009] VSCA 233; Smith v Shilkin (No 3) [2020] NSWSC 787; Colgate Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248; EMI Records Ltd v Ian Cameron Wallace Ltd [1983] Ch 59; Queensland North Australia Pty Ltd v Takeovers Panel (No 2) (2015) 109 ACSR 232; Ruddock v Vadarlis (No 2) [2001] FCA 1865; (2001) 115 FCR 229; Hockey v Fairfax Media Publications Pty Ltd (No 2) [2015] FCA 750; Cretazzo v Lombardi (1975) 13 SASR; Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107; Umoona Tjutagku Health Service Aboriginal Corporation v Walsh [2019] FCAFC 32; Playgro Pty Ltd v Playgro Art & Craft Manufactory Ltd (No 2) [2016] FCA 478; Victorian WorkCover Authority v Kagan Bros Consolidated Pty Ltd [2011] VSCA 91; (2011) 31 VR 386, considered.

STEER v AMP LIFE LIMITED & AMP SUPERANNUATION LTD (No 2)
[2021] SADC 155
Civil
Introduction

On 8 October 2021, the Court published its reasons and found that the applicant was entitled to judgment against the second respondent, AMP Superannuation Ltd (AMP Super), and that the claim of the applicant against the first respondent AMP Life Limited (AMP Life) should be dismissed. On 26 October 2021, judgment was entered in favour of the applicant against AMP Super in the sum of $286,048 inclusive of pre-judgment interest. The claim of the applicant against AMP Life was dismissed.
The applicant now seeks his costs on an indemnity basis against AMP Super and further seeks, if necessary (to the extent that a costs order is made in favour of AMP Life), a Bullock or Sanderson Order in relation to the costs of AMP Life. AMP Life seeks, on a party and party basis (or on the standard costs basis as it is now known), its costs of the action during the period that it was the only respondent (that is until 5 November 2020 when an order was made for the joinder of AMP Super). After that period, AMP Life seeks 50% of its costs on a party and party basis. AMP Super submits that no order for costs should be made against it or alternatively, it should only pay 25-35% of the costs of the applicant, again on a party and party basis. It contends that the deduction should be made from the costs that the applicant would otherwise be entitled to because of the conduct of the applicant in pursuing various unsuccessful causes of action.
Both AMP Life and AMP Super were represented by the same counsel and, except for a brief period, by the same solicitors. At the time of the relevant events, AMP Super was a wholly owned subsidiary of AMP Life. They were both part of the AMP Group. As a result of a corporate restructure, AMP Life is no longer part of the AMP Group and as from 30 June 2020, it has an external party as its ultimate holding company. AMP Super however remains part of the AMP Group.
The applicant submitted that AMP Life managed AMP Super or acted as its agent. It follows from the corporate restructure that I have described above that, during the course of the proceedings, AMP Life could not be said to manage AMP Super or act as its agent. There was, in any event, no evidence to suggest such a relationship even when AMP Super was a subsidiary of AMP Life. The two companies were separate entities, performing different functions. AMP Super was the trustee of a superannuation fund and had powers and duties in that capacity. AMP Life was a life insurance company and issued various life insurance policies, including a group life insurance policy with AMP Super. I reject the submission of the applicant that AMP Life and AMP Super issued joint product disclosure statements. The evidence shows that the Product Disclosure Statement (PDS) was issued by AMP Super. The PDS referred to the group life insurance policy held by AMP Super in AMP Life as being one of the products being offered as part of the membership of the superannuation fund.
Background to dispute about costs
The applicant brought the action as the trustee of Carolyn Christina Burns (the Deceased). The Deceased was a member of the superannuation fund known as the AMP Retirement Fund of which AMP Super was the trustee. One of the products that was offered by AMP Super and accepted by the Deceased was an interest in the group life insurance policy that AMP Super had entered into with AMP Life. The Deceased did not directly hold an interest in the life insurance policy with AMP Life.
For many years, the deductions for premiums for the interest that the Deceased had in the group life insurance policy through her membership of AMP Super, were paid by AMP Super to AMP Life out of the balance of the superannuation account held by the Deceased in the Fund.
As a result of changes to superannuation legislation introduced in 2019 by the Treasury Laws Amendment Act (Protecting Your Superannuation Package) 2019 (Cth), AMP Super was not able to continue to pay premiums for the interest of the Deceased in the group life insurance policy with AMP Life if the account had been inactive for a continuous period of at least 16 months and where the member had not elected for those payments to be continued. I made findings in my reasons that AMP Super did not notify the Deceased of her right to elect to consent to the payments for the premiums to continue to be made. AMP Super sent an email to a previous work email address of the Deceased. The Deceased had never agreed for emails to be sent to that address and had not used that address for many years. Accordingly, the emails did not ever come to the attention of the Deceased and thereforre the Deceased was not able to elect to agree to premiums to continue to be paid by AMP Super to AMP Life and thereby maintain her interest in the group life insurance policy.
On 1 July 2019, AMP Super cancelled the interest of the Deceased in the group life insurance policy that it held with AMP Life because it was precluded from continuing to make the premiums due in respect of her interest in the policy. As at 30 June 2019, the Deceased was entitled to payment in the sum of $259,720.97. However, because the Deceased’s interest in the group life insurance policy had been cancelled, both AMP Life and AMP Super denied any liability to pay that sum or the equivalent amount in damages.
Ultimately, I found that AMP Super had breached its duty as trustee to act in the best interests of the Deceased and was liable to pay damages to the applicant. I found that AMP Life was not liable as it was AMP Super that cancelled the interest of the Deceased in the group life insurance policy.
I accept on the evidence that it was unclear exactly what had happened between AMP Life and AMP Super in relation to the cancellation of the Deceased’s interest in the life insurance policy and what actions were taken by which entity. There was no direct evidence on this issue at trial.
The evidence on this topic at trial was as follows:
(1)an email sent on 18 April 2019 on AMP letterhead (without designating which entity) advising that as a result of the recent legislation, superannuation providers were obliged to cancel insurance inside super, once the account had been inactive for a continuous period of 16 months. The fine print to the email indicated that the email was sent by AMP Super.
(2)a further email sent on 4 June 2019 on AMP letterhead (again without designating the entity) which advised that insurance benefits would cease to be provided on 1 July 2019 if the account remained inactive unless the Deceased advised that she wanted to keep the insurance inside the superannuation account. The fine print to the email indicated that any advice in the document was provided by AMP Life, which was part of the AMP group of companies. The fine print also made reference to AMP Super’s role as trustee of the AMP Retirement Trust.
(3)emails sent by Haysman Financial Services Pty Ltd dated 13 May 2019 and 25 June 2019 in the capacity as authorised representatives and credit representatives of AMP Financial Planning Pty Ltd relating to the changes in legislation.
(4)An email sent on 7 July 2019 on AMP letterhead (again without designating the entity) which advised that “we” had cancelled your life insurance. The fine print to the email indicated that any advice in the document was provided by AMP Life which was part of the AMP group of companies. The fine print also made reference to AMP Super’s role as trustee of the AMP Retirement Trust.
The Proceedings
The applicant instituted proceedings on 31 March 2020 against AMP Life. The applicant sought remedies against AMP Life for breach of the life insurance policy, breach of the Life Insurance Code of Practice (an industry code for the purposes of the Competition and Consumer Act 2010 (Cth)) by cancelling the policy without giving the appropriate notice and if necessary seeking an order for the reinstatement of the policy. The pleading was based on the express premise that AMP Life cancelled the life insurance policy without proper notice.
The defence of AMP Life dated 29 April 2020 pleaded inter alia that the insurance cover ceased on 1 July 2019 by operation of the Protecting Your Super provisions.
At the directions hearing on 10 August 2020, the Court invited the applicant to consider joining AMP Super. This issue had been raised at an earlier hearing on 27 July 2020 before Master Olsson. The applicant initially refused to join AMP Super and stated that he could proceed under s 48A of the Insurance Contracts Act1984 Cth. against AMP Life. On 24 September 2020, the solicitors for AMP Life wrote to the applicant’s solicitors and advised them that AMP Life was directed by AMP Super to reduce the insurance benefit of the Deceased to zero (because of the Protecting Your Super legislation) and that AMP Life merely followed that direction, as it was contractually bound to do. The letter went on to state that any dispute that the applicant may have regarding the cancellation of the insurance cover must be directed to AMP Super and not AMP Life.
At the directions hearing on 5 November 2020, the applicant applied to join AMP Super as a respondent and amend its statement of claim accordingly. I made an order that AMP Super be joined as a party within 7 days and the applicant to file and serve a revised statement of claim by 13 November 2020.
On 12 November 2020, the applicant joined AMP Super as the second respondent in the proceedings and filed an amended statement of claim. The amended claim, as I said in my reasons, is a confusing document but makes claims for:
(1)misleading and deceptive conduct (contrary to the Corporations Act and the ASIC Act against both AMP Life and AMP Super;
(2)breach of the terms of the Life Insurance Policy by AMP Life and AMP Super;
(3)an overpayment of premiums which should have been allocated to the payment of the premiums due under the life insurance policy (and therefore a failure by AMP Life and AMP Super);
(4)breach of the duty of utmost good faith under ss 13 and 14 of the Insurance Contracts Act 1984 (Cth) or under the unwritten law against both AMP Life and AMP Super;
(5)breach by AMP Super of its duty to act in the best interests of the Deceased (which is the only cause of action that I upheld);
(6)contravention of the Superannuation Industry (Supervision) Act 1993 Cth and in negligence against AMP Super; and
(7)unconscionable conduct by AMP Life and AMP Super.
The trial was heard over two days on 29-30 March 2021. There were only three witnesses, the applicant and his stepdaughter, and Mr Roveto, the head of communications at AMP. None of the evidence that they gave was controversial and all of their evidence would have been required in relation to the beach of trust claim against AMP Super which was upheld.
Issues
The following issues relating to costs require determination:
(1)Is the applicant entitled to indemnity costs against AMP Super?
(2)Should there be any deduction for costs on account of the conduct of the applicant in suing only AMP Life initially or on account that he only succeeded on one cause of action when he made numerous claims against both AMP Life and AMP Super?
(3)Is the applicant liable to AMP Life for its costs?
(4)If the applicant is liable to AMP Life for its costs, is the applicant entitled to a Bullock or Sanderson order in respect of the costs of AMP Life?
General costs rules and principles
The starting point in determining the appropriate order for costs is section 42(1) of the District Court Act 1991 SA, which provides:
Subject to subsection (2) and the rules, costs in any proceedings in the Civil Division will be in the discretion of the Court and may be awarded against any person (whether a party or a witness in the proceedings or not).
Section 42(2) does not have any application in the present case.
The Uniform Civil Rules 2020 (UCR) include a number of rules that are relevant and may inform any order for costs. UCR 194.5(1)(d) confirms the overriding discretion of the Court as to costs. UCR 194.5(2)-(11) then set out a number of general costs principles which are subject, inter alia, to the general overring discretion as to costs. Relevant to this application is UCR 194.5(2) which provides that costs follow the event. The Court has a discretion under UCR 194.3(1)(a) to award costs on the standard costs basis, a solicitor/client basis, an indemnity basis or any other basis. The applicant submitted that UCR 194.5(6) was also relevant. That rule provided that:
(6)    Costs incurred a result of multiple parties with an identical or common interest being separately represented, or separately participating in the proceeding, are to be borne by those parties, if, in the opinion of the Court-
a.   the separate representation or participation was not necessary; or
b.   the separate representation or participation occurred to a greater extent than was necessary.

However, UCR 194.5(6) has no application to the present dispute as AMP Life and AMP Super were represented by the same solicitors and counsel.
The awarding of costs in the present case is not straightforward in that, even though they were related and represented by the same solicitors and counsel, one respondent was successful and the other respondent was unsuccessful. The position is further complicated by the applicant initially instituting proceedings against AMP Life, the successful respondent and later on joining to those proceedings, AMP Super, the unsuccessful respondent.
Where a number of respondents have the same representation and are variously successful and unsuccessful, the principle of apportionment or as it is more commonly known, the rule of thumb, has developed as to the apportionment of costs between the parties. The rule of thumb had its origins in the Chancery practice as to costs. Kourakis CJ in Rasch Nominees Pty Ltd & Anor v Bartholomaeus & Or (No 3)[1] referred to the rule in the following terms:
When defendants who are jointly represented variously fail and succeed, the rule is that the plaintiff is liable to the successful defendant for those costs which are attributable to the work done for that defendant alone and for a proportionate share of the costs of the work performed in common for all defendants. The origin of the rule is in the Chancery practice as to costs when bills were filed against multiple defendants in order to properly constitute proceedings even though some defendants were only peripherally concerned in the substantial controversy. A solicitor acting for all of the defendants was, in the absence of an express agreement which provided otherwise, limited to recovering from each defendant the costs only for that work performed exclusively for him or her and for a proportionate share of the costs of the work done in common. That contractual presumption was, in turn, reflected in the costs orders made against a plaintiff in favour of a successful defendant. The contractual presumption did not apply to joint plaintiffs who, in the absence of a special retainer, were jointly and severally liable for all of the costs of the jointly retained solicitor.(citation omitted).
[1] [2013] SASC 14 at [11].
That statement was cited with approval on appeal in Rasch Nominees Pty Ltd v Bartholomaeus[2] and was disccused in some detail by Einstein J in Currabula Holdings Pty Ltd v State Bank of New South Wales.[3] The rule of thumb was formaulted by Young JA in King Network Group Pty Ltd v Club of the Clubs Pty Ltd (No 2)[4] in similar terms:
…that a successful jointly represented defendant recovers a proportionate share of the common costs which are referrable to clams pressed against each of the defendants.
[2] [2013] SASCFC 105 at [32].
[3] [2000] NSWSC 232 at [89]-[95].
[4] [2009] NSWCA 204 at [25].
That expression of rule of thumb was approved by McDougall J in James v Royal Bank of Scotland; McKeith v Royal Bank of Scotland (No 2) (Royal Bank of Scotland).[5] The Court of Appeal in the Supreme Court of Victoria in Chen v Chen (No 2)[6] also expressed the rule of thumb in similar terms, but added the primary issue for determination is that of fairness as between the parties, having regard to the manner in which the trial had been conducted.
[5] [2015] NSWSC 970 at [28].
[6] [2009] VSCA 233 at [10].
There has been some criticism of the rule of thumb and cases have suggested that it should not be rigidly applied. In Howards Storage World Pty Ltd v Haviv Holdings Pty Ltd,[7] Edmonds J (with whom Lindgren J agreed) held:
As for the applicability of the ‘rule of thumb’, it is evident from the cases referred to at [62] – [64] above that to the extent that a ‘rule of thumb’ is to be applied in apportioning costs, it is only to be applied in ordinary and straightforward cases. It is a convenient guide, rather than a rigid device to be applied irrespective of the individual circumstances. Mechanical application of the ‘rule’ without careful consideration of the individual circumstances could bring about the very injustice the rule is designed to remedy. The primary judge recognised, and I agree, that the present circumstances, with a multiplicity of parties and claims together with the nature of the relationships between the parties, are not the kind of ordinary or straightforward case to which it was convenient and appropriate to apply a ‘rule of thumb’ in the apportionment of costs.
[7] [2010] FCAFC 5; (2010) 182 FCR 84 at [70].
This statement was approved in Royal Bank of Scotland.[8] Kourakis CJ in Rasch Nominees Pty Ltd & Anor v Bartholomaeus & Ors (No 3)[9] held:
The “rule of thumb” founded, as it is, in the practice in Chancery is problematic in its application to multiple parties and claims properly joined in one action in accordance with the Judicature Act reforms. My preference is to approach the costs discretion from the starting point that costs should reflect the way in which the common issues in the joint trial were decided and the reasonableness of the respective claims and defences of the parties.
Adopting such an approach, the primary judge in Howards Storage World held that the way to do substantial justice between the parties as to costs in that case was to aggregate the parties and the causes of action, so as to view the contest in the primary proceeding as being essentially one between two entities about a single dispute (save for some subsidiary causes of action that are not of concern in this appeal).[10] On appeal, Gray J held that there was ample justification for the primary judge taking the view that aggregation of the parties and the causes of action was appropriate.[11] Gray J accepted that to make separate costs order in relation to individual successful and unsuccessful respondents would have led to an artificiality and produced substantial injustice. Lindgren and Edmonds JJ, although writing separate judgments, agreed the appeal should be dismissed and did not disagree with the approach taken by the primary judge. They agreed that close attention should be paid to the circumstances of the case.[12] Those comments were followed in Royal Bank of Scotland (No 2)[13] and in Smith v Shilkin (No 3).[14]
[8] [2015] NSWSC 970 at [46].
[9] [2013] SASC 14 at [13].
[10] [2010] FCAFC 5 at [10].
[11] Ibid at [17].
[12] Ibid at [21] and [67].
[13] [2015] NSWSC 970 at [46].
[14] [2020] NSWSC 787 at [60].
Determination
Approach to the issue of costs
Before determining the individual issues relating to costs, it is first necessary to determine the appropriate approach to the question of costs, given that the applicant was successful against one respondent, AMP Super, but was unsuccessful against the other respondent, AMP Life. I consider that in the circumstances of this case that justice between the parties is best achieved by an aggregated approach to the respondents and to the causes of action. I have come to this conclusion for a number of reasons. First, the applicant made one claim in substance - to receive the benefit of the balance of the account of the Deceased in the group life insurance policy. Secondly, the applicant was successful in that claim. Thirdly, AMP Life and AMP Super were related companies at the time of the dispute, AMP Super then being a wholly owned subsidiary of AMP Life. They were both part of the AMP Group of Companies. Fourthly, the claim related to a transaction that occurred between AMP Life and AMP Super, that being the group life insurance policy taken out by AMP Super with AMP Life. The precise details of the arrangement between AMP Life and AMP Super through the Group Life Insurance Policy were not immediately apparent to the applicant. Fifthly, there was confusion in the way that AMP Life and AMP Super communicated with persons who had an interest in the group life insurance policy. The communications were primarily sent under the AMP letterhead and it was often difficult, as I have set out above, to determine the individual entity that sent the communication. Sixthly, it is apparent that each of the respondents were part of the AMP Group and that the Group as a whole undertook administrative functions for the individual entities that formed part of the Group.
I note that AMP Life and AMP Super were, during the time that they were both parties to the action, represented by the same counsel and solicitors.
For the above reasons, I do not consider it appropriate to characterise the claims by the applicant as two separate claims, one successful and one unsuccessful. I do not consider that justice would be done between the parties if I adopted the approach of dividing the claims against AMP Life and AMP Super. I consider that the applicant was in substance making one claim in respect of which it was successful. I therefore will approach the determination of the issues as to costs that I have identified on the basis of an aggregated approach to the respondents and their claims.
Indemnity costs
The applicant has not articulated any basis for the award of indemnity costs in its favour against AMP Super. There is no evidence of any relevant offers being made which have been bettered by the applicant, nor is any reliance placed upon them.
The applicant did not advance his application on the basis that indemnity costs should be awarded because AMP Super was a trustee or that the applicant brought these proceedings in his capacity as the executor and trustee of the estate of the Deceased. In the circumstances of this case, I do not consider these matters provide a basis for an award of indemnity costs in favour of the applicant. I accept that the trustee basis is one of the bases in which indemnity costs may be ordered.[15] The applicant received an award of equitable damages for the breach of trust rather than an order for replenishment of the trust. In those circumstances, I do not consider that an order for indemnity costs must inevitably follow. I have a discretion as to whether or not I should order costs on an indemnity basis. The conduct of the respondents and the way in which the trial proceeded do not, in my view, justify an award on an indemnity basis. The trial was run very efficiently over two days. There was no delay in the conduct of the hearing. The applicant, on the other hand, adopted a scatter gun approach to the litigation, pleading numerous causes of action (all but one of which failed) and making no submissions in relation to some causes of action (e.g. unconscionability), even though they were not formally abandoned. The applicant also caused delay and costs in the proceedings more generally by initially only electing to sue AMP Life and not AMP Super. The respondent ran a narrow defence, which, although clearly arguable, did not occupy much time at trial. In all of the above circumstances, I decline to exercise my discretion to award indemnity costs. The applicant is only entitled to party and party costs (or standard costs as they are now called).
Period for which costs should be ordered against AMP Super
[15] Colgate Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248 at 253; EMI Records Ltd v Ian Cameron Wallace Ltd [1983] Ch 59 at 63-65.
The next question is how I should approach the period in which only AMP Life was a party to the proceedings. I do not consider that it is appropriate that I should award costs against AMP Super when it was not a party to the proceedings. I will therefore award party and party costs against AMP Super only from 5 November 2020 being the date that I ordered AMP Super be joined as a party to the proceedings.
Deduction of costs on issue basis
Thirdly, I must consider whether it is appropriate to make a deduction for costs because the applicant brought seven separate causes of action against AMP Super and was only successful in one of those claims. There were also numerous claims against AMP Life. AMP Super and AMP Life therefore invite the Court to deal with costs on an issue by issue basis or at least make a substantial deduction in respect of the costs that might be awarded to the applicant as a result of the time spent on issues in respect of which AMP Super and AMP Life was successful.
The starting point for consideration of this issue is the principle that ordinarily costs will follow the event and that the successful party will receive its costs in the absence of special circumstances justifying some order.[16]
[16] Queensland North Australia Pty Ltd v Takeovers Panel (No 2) (2015) 109 ACSR 232 at [11] referring to Ruddock v Vadarlis (No 2) [2001] FCA 1865; (2001) 115 FCR 229 at [11]; Hockey v Fairfax Media Publications Pty Ltd (No 2) [2015] FCA 750 at [37].
However, for many years, the Courts have recognised that a discretion exists to deprive parties of their own costs and order they pay the costs of the other side in relation to issues where they been unsuccessful. In Cretazzo v Lombardi,[17] Bray CJ held:
A successful party who has failed on certain issues may well not only be deprived of his own costs of those issues, but ordered in addition to pay his opponent’s costs of them, and in this context “issue” does not mean a precise issue in the technical pleading sense, but any disputed question of fact or, in my view, of law.
[17] (1975) 13 SASR 4 at 12.
As White J observed in Hockey v Fairfax Media Publications Pty Ltd (No 2),[18] Jacobs (who agreed with the reasons of Bray CJ, but cautioned against the too ready apportionment of costs on an issues basis) stated:
I wish merely to lend no encouragement to any suggestions that a party against whom the judgment goes ought nevertheless to anticipate a favourable exercise of the judicial discretion as to costs in respect of issues upon which he may have succeeded basely merely on his success in those particular issues.
[18] [2015] FCA 750 at [86]; (2015) 237 FCR 127 at [88].
The High Court in Firebird Global Master Fund II Ltd v Republic Nauru (No 2)[19] affirmed the general reluctance of Courts to deal with costs on an issue by issue basis. French CJ, Kiefel, Nettle and Gordon JJ held:
There are no special circumstances to warrant a departure from the general rule and good reasons not to encourage applications regarding costs on an issue by issue basis, involving apportionments based on degree of difficulty of issues, time taken to argue them and the like.
[19] (2015) 327 ALR 192 at [6].
Courts are willing to adopt an issue by issue basis or deprive a party of portion of their costs where the justice of the cases so requires. In Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2),[20] the Full Federal Court held that if an issue by issue approach will produce a result that is fairer than the traditional rule, it should be applied.
[20] [2008] FCAFC 107 at [5].
Cases where the court has considered a proper exercise of the discretion as to costs to justify an award of costs on an issue basis or to take into account costs on a particular issue usually involve three categories:[21] (1) where the application has only been partially successful in terms of the relief that it obtained (2) where it has succeeded in obtaining the relief sought but not succeeded on all factual and legal bases that it advance (3) a consideration of the successful party’s conduct.
[21] Queensland North Australia Pty Ltd v Takeovers Panel (No 2) (2015) 109 ACSR 232 at [11]; Umoona Tjutagku Health Service Aboriginal Corporation v Walsh [2019] FCAFC 32 at [43].
In ACCC v CFMEU (No 4),[22] Middleton J held:
If a successful party has caused a significant increase in the length or cost of proceedings by raising issues or making allegations on which he fails, then it may be deprived of the whole or part of its costs. However, a successful party who neither improperly nor unreasonably raises issues or makes allegations on which he fails ought not ordinarily be ordered to pay any part of the unsuccessful party’s costs.
[22] [2018] FCA 684 at [107].
In Macks v Viscariello (No 2),[23] the Full Court of the Supreme Court held that:
Factors to be considered when assessing costs on separate issues include determining whether the issues were separate and distinct, the importance of the issues (including whether they had merit), and the time taken at trial in litigating those issues.
[23] [2018] SASCFC 106 at [33].
A relevant factor is the time spent on unsuccessful issues. It is a factor against making a costs order based on an issue, if the issue did not occupy a great deal of time at trial and the trial would not have been much shorter if the issue had not been raised.[24]
[24] Playgro Pty Ltd v Playgro Art & Craft Manufactory Ltd (No 2) [2016] FCA 478 at [433].
The Court in Aussiegolfa Pty Ltd (as trustee of the Benson Family Superannuation Fund) v Commissioner of Taxation (No 5)[25] held that there was a considerable advantage in terms of costs and time if the court made a percentage costs order rather than two costs orders. The Full Court in Lesses v Maras (No 3)[26] made a similar observation when it held (where the applicant had “mixed success):
…a court may in appropriate circumstances reduce the costs ordered in favour of the overall successful party, and further may order that party to pay the opponent’s costs, in respect of such issues. When the court considers that the discretion should be so exercised, it will usually make an order for payment of a proportion of one party’s costs by the other party reflecting a broad axe assessment, even when it considers that the successful party should pay the opponent’s costs in respect of such issues. (citation omitted)
[25] [2018] FCAFC 156 at [8]-[9].
[26] [2017] SASCFC 154 at [82].
In my opinion, it is appropriate to make a deduction for the wasted costs AMP Super and AMP Life expended defending the numerous causes of action in which the applicant was unsuccessful. In my opinion, it is appropriate to deduct 20% of the applicant’s costs. I consider that the unsuccessful causes of action did not cause a prolongation of the trial. The trial was run expeditiously. Each of the witnesses would have been required in any event. The documentary evidence would still have needed to be tendered. I accept that there was some wasted time incurred by AMP Super and AMP Life in responding to the causes of action which were unsuccessful. However, that time was relatively small compared to the time spent in defending the proceedings generally. In the circumstances I consider that the Court should not determine costs on an issue by issue basis, but instead should assess costs in a lump sum manner. I consider it appropriate to deduct 20% of the applicant’s costs as a result of the additional causes of action that were not successful. This deduction includes an allowance for the wasted time and also the costs that would have been awarded to AMP Life in respect of those wasted costs.
AMP Life and AMP Super placed reliance on the decision of White J in Hockey v Fairfax Media Publications Pty Ltd (No 2),[27]where the applicant received only 15 % of his costs where he succeeded on some causes of actions and not others and succeeded against some respondents and not others. However, that was a very different case in that the principal claims made by the applicant failed[28] and only some minor claims succeeded. Further, there were three independent claims against three different parties. White J held:
It is plain that Mr Hockey is not entitled to his costs in full against the SMH and The Age as in those proceedings he failed on the matters which were the real core of his claim. Had Mr Hockey sued only on the SMH poster and the two tweets of the Age, the proceedings would have been much more confined, and, possibly, may not have involved a trial at all. Mr Hockey failed on a number of legal and factual issues at trial.
[27] [2015] FCA 750; (2015) 237 FCR 127 at [88].
[28] Ibid at [1] and [2].
AMP Super also submitted that based on an issue approach to costs, the applicant should not receive more than 25-30% of its costs. That is not the correct approach in my view. The issue of costs should no be divided up into parts which were successful or unsuccessful. Rather, the court should ask whether there is good reason to deprive the successful applicant of some part of its costs, one of those reasons being that a certain amount of time was wasted pursing issues that were unsuccessful.
Sanderson or Bullock Order

There is no basis or need for a Sanderson or Bullock Order. A Bullock Order requires the unsuccessful respondent, in this case, AMP Super, to reimburse the applicant for the costs of the successful respondent.[29] A Sanderson order requires the unsuccessful respondent to pay direct to the successful respondent, the costs for which the applicant would otherwise be liable to the successful respondent. Neither order is appropriate in the present case as I have undertaken an aggregated approach to the respondents and not awarded costs generally to AMP Life (except when it was sole respondent). A Bullock Order or Sanderson Order is also not generally appropriate where the claims were not alternatives.[30] Further, there was no conduct of AMP Super, as the unsuccessful respondent, that made it reasonable to pay the costs of AMP Life, the successful respondent.[31] Indeed, AMP Life had set out in a letter to the applicant dated 24 September 2020 why AMP Super was the only party that could be liable to the applicant. AMP Super did not ever seek to attribute blame to AMP Life. Its defences, even if they were successful, would not have cast blame or responsibility on AMP Life.
Costs of AMP Life-the successful respondent
[29] GE Dal Pont “Law of Costs” 5^th ed , 2021 at [11.12].
[30] Victorian WorkCover Authority v Kagan Bros Consolidated Pty Ltd [2011] VSCA 91; (2011) 31 VR 386.
[31] Cornwall v Rowan (No 2) [2005] SASC 122.
AMP Life has sought its costs of the action on the basis that the claim against it was dismissed. I do not consider that it is appropriate to separate the costs of the first respondent and the second respondent in this way. As I have said, I have taken an aggregated approach to the respondents in relation to question of costs. Therefore, with the exception of the time when it was the sole respondent, I do not consider that AMP Life is entitled to its costs. AMP Life is entitled to its costs in relation to the period when it was the only respondent. There is no reason to deny AMP Life its costs of that period. It was the applicant who decided to bring its claim only against AMP Life. It had been provided with sufficient information at that time to understand that AMP Super should be joined as a respondent. Therefore, AMP Life is entitled to its costs until the order was made on 5 November 2020 joining AMP Super as a respondent to the proceedings.
Conclusion
AMP Super is to pay to the applicant 80% of his costs on the standard costs (ie party and party) basis as from 5 November 2020.
The applicant is to pay to AMP Life its costs of the claim up until 5 November 2020 on the standard costs (ie party and party) basis.
There are no other orders for costs.