Steicke v Pederick (No 2)
[2020] SASCFC 13
•26 February 2020
SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
STEICKE v PEDERICK & ANOR (No 2)
[2020] SASCFC 13
Judgment of The Full Court
(The Honourable Justice Kelly, The Honourable Justice Nicholson and The Honourable Justice Lovell)
26 February 2020
PROCEDURE - COSTS - DEPARTING FROM THE GENERAL RULE - ORDER FOR COSTS ON INDEMNITY BASIS
Application for costs on indemnity basis by the respondents.
Where applicant unsuccessfully applied for permission to appeal a decision of a Master to dismiss an interlocutory application for an extension of time to comply with self-executing orders – where the respondents as the successful party seek an order that the applicant pay the respondents’ costs of the appeal on an indemnity basis.
Whether the applicant had a reasonable prospect of success in her application for permission to appeal - whether the Court should depart from the general rule and order the applicant to pay the respondents’ costs of the appeal on an indemnity basis.
Held: the applicant is to pay the respondents’ costs of the appeal to be adjudicated on a party and party basis if not agreed.
Pascoe Ltd (in liq) v Lucas (1999) 75 SASR 246, applied.
Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FLR 225, considered.
STEICKE v PEDERICK & ANOR (No 2)
[2020] SASCFC 13Full Court: Kelly, Nicholson and Lovell JJ
THE COURT
Introduction
The applicant unsuccessfully applied to this Court for permission to appeal against a decision of a Master to dismiss her interlocutory application for an extension of time to comply with self‑executing orders made by the Master on 28 February 2018, or in the alternative, for the proceedings to be referred to mediation. The respondents now seek an order that the applicant pay the respondents’ costs of the appeal to this Court to be adjudicated on an indemnity basis.
This Court delivered its reasons for refusing to grant the applicant permission to appeal on 29 November 2019. On that date, following an application by the respondents as the successful party, this Court made the following orders:
1Permission to appeal is refused.
2The applicant is to pay the respondents’ costs of the appeal to be adjudicated on a party and party basis if not agreed, with leave being granted to the respondents to make an application for costs on a higher basis by way of written submissions of no more than three pages in length, to be filed and served by 4 pm on Wednesday, 4 December 2019.
3In the event that the respondents make application for costs on a higher basis, the applicant may respond to the application by written submissions of no more than three pages in length to be filed and served by 4 pm on Friday, 6 December 2019.
In accordance with those orders, the respondents duly filed an application that the applicant pay the costs of the appeal to be adjudicated on an indemnity basis. The written submissions in support of that application were provided to the Court on 4 December 2019.
The applicant has not filed any response to that application.
Accordingly, the Court will deal with the respondents’ application as follows.
Discussion
It is not necessary to set out the history of the proceedings as they have been fully canvassed in the Court’s reasons delivered on 29 November 2019.[1]
[1] Steicke v Pederick & Anor [2019] SASCFC 148.
We accept that this Court has a discretion to order costs which is unfettered. The discretion is attended by the requirement, of course, that it be exercised judicially by the Court having regard to relevant considerations and by ignoring irrelevant considerations.
While the usual order is to award the successful party costs on a party and party basis, this Court has the power to award indemnity costs if warranted by the circumstances of the case.
Further, we accept that there is no fixed rule as to when the discretion may be exercised. The categories of the case where such an order may be made are not closed.[2]
[2] Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FLR 225, 233-234.
It is accepted that one such category or case where an award of indemnity costs may be justified will be in circumstances where proceedings are brought and maintained where there is no reasonable prospect of success.
The respondents, in making the application for indemnity costs, relied on a number of authorities affirming that principle.[3]
[3] Baillieu Knight Frank (NSW) Pty Ltd v Ted Manny Real Estate Pty Ltd (1992) 30 NSWLR 359; Huntsman Chemical Co Australia Ltd v International Pools Australia Pty Ltd (1995) 36 NSWLR 242, [273]; Bolger v McDermott (No 2) [2013] NSWSC 1330, [39]-[41]; Seven Network (Operations) Limited and Anor v Amber Harrison [2017] NSWSC 952, [87]; Moneytech Finance Pty Ltd v Diamond Made Pty Ltd (in liq) (No 2) [2019] NSWSC 1577, [108]; Chaina v Alvaro Homes Pty Ltd [2008] NSWCA 353, [111].
The respondents contend that the applicant never had any reasonable prospect of success in her application to this Court for permission to appeal and relies substantially on this Court’s reasons for concluding that it was not open to the Master to retrospectively stay any of the orders made, or to refer the proceedings to mediation. In particular, the respondents pointed to the fact, which this Court accepted, that there was no reason to set aside the consent orders made by the Master and there was no evidence to suggest that they were made without consent, or that the respondents misled the applicant in any way.
It may be accepted that this Court did make those findings. However, the Court’s reasons were delivered after close and careful analysis of all the legal issues raised and after consideration of the lengthy history of these proceedings.
It is perhaps not difficult, with the wisdom of hindsight and the benefit of the Court’s reasons, to characterise the applicant’s position as hopeless. However, that fact alone does not necessarily justify a departure from the usual order to award costs on a party and party basis.
We are mindful that these proceedings are connected with long and bitterly contested proceedings in another court.
In Pascoe Ltd (in liq) v Lucas,[4] it was regarded as well settled that this Court will not depart from the usual order that the successful party recover only party and party costs merely because the Court ultimately concludes that the losing party’s case lacked merit.
[4] (1999) 75 SASR 246, 279 [313].
As we are not prepared to find that the applicant, properly advised, should or must have known she had no chance of success, we decline to award indemnity costs.
In our view, while the application clearly lacked merit, it does not warrant an order for costs other than in accordance with the general rule.
Conclusion
The applicant is to pay the respondents’ costs of the appeal to be adjudicated on a party and party basis if not agreed
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