Stockco Agricapital Pty Ltd v Chalmers
[2023] NSWSC 818
•12 July 2023
Supreme Court
New South Wales
Medium Neutral Citation: Stockco Agricapital Pty Ltd v Chalmers [2023] NSWSC 818 Hearing dates: On the papers; submissions received 7 July 2023 Date of orders: 12 July 2023 Decision date: 12 July 2023 Jurisdiction: Equity - Commercial List Before: Stevenson J Decision: Cross-claimants to pay first cross-defendant’s costs thrown away including costs paid to mediator in two mediations as assessed and payable forthwith
Catchwords: COSTS – party/party – costs orders in interlocutory proceedings – whether costs thrown away should include costs of mediations – whether costs should be payable forthwith under rule 42.7(2) Uniform Civil Procedure Rules 2005 (NSW) – where amended cross-summons and cross-claim statement filed on discrete issue separate to principal proceedings
Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited: G&S Engineering Services Pty Ltd v MACH Energy Australia Pty Ltd (No 2) [2019] NSWSC 463
Texts Cited: Practice Note SC Eq 3
Category: Costs Parties: Stockco Agricapital Pty Limited (Plaintiff/Second Cross-Defendant)
Christopher Robert Chalmers (First Defendant/First Cross-Claimant)
Amanda Gaye Chalmers (Second Defendant/Second Cross-Claimant)
Elders Rural Services Australia Limited (First Cross-Defendant)Representation: Counsel:
Solicitors:
W K Soon (Defendants/Cross-Claimants)
B K Koch (First Cross-Defendant)
Norton Rose Fulbright (Plaintiff/Second Cross-Defendant)
Levitt Robinson Solicitors (Defendants/Cross-Claimants)
Crawford Legal (First Cross-Defendant)
File Number(s): 2020/143664
JUDGMENT
-
On 23 June 2023, by consent, I ordered that the cross-claimants, Mr and Mrs Christopher and Amanda Chalmers, have leave to file a proposed Amended Commercial List Cross-Summons and Further Amended Commercial List Cross-Claim Statement (together, “the Amended Cross-Claim”) against the first cross-defendant, Elders Rural Services Australia Limited.
-
I also ordered, by consent, that Mr and Mrs Chalmers pay Elders’ costs thrown away by reason of the amendment to the cross-claim.
-
Issues arise as to whether I should order that those costs include the costs of mediations that occurred on 6 May 2021 and 15 December 2022 and order that such costs be paid forthwith.
-
As to the costs thrown away, the particular costs sought by Elders are the costs it paid in relation to the mediator’s fees and disbursements at the mediations, being $5,337 in respect of the 6 May 2021 mediation and $10,428.16 in respect of the 15 December 2022 mediation: a total of $15,765.16 (exclusive of GST).
-
At the time of the mediations, the issues in the proceedings concerned the claim of the then plaintiff, Stockco Agricapital Pty Limited, against Mr and Mrs Chalmers, Mr and Mrs Chalmers’ cross-claim against Stockco, and Mr and Mrs Chalmers’ then cross-claim against Elders in which, in effect, Mr and Mrs Chalmers sought to pass on to Elders such liability as they may have had to Stockco.
-
I am informed that at the 15 December 2022 mediation, the proceedings between Mr and Mrs Chalmers and Stockco settled. I have not been informed of the basis of that settlement. On 30 January 2023, the Court noted that Stockco’s claim against Mr and Mrs Chalmers had been discontinued, as had Mr and Mrs Chalmers’ cross-claim against Stockco.
-
By way of their Amended Cross-Claim, Mr and Mrs Chalmers now seek to pursue new claims against Elders which relate in no way to the claims they have hitherto made. The new claims that Mr and Mrs Chalmers now seek to make against Elders include claims arising from the quality and condition of livestock alleged to have been provided to Mr and Mrs Chalmers by Elders and various loss of opportunity claims.
-
Thus, the issues now at play between Mr and Mrs Chalmers and Elders are quite different from those that were at play prior to the settlement of the proceedings between Mr and Mrs Chalmers and Stockco.
-
For obvious reasons I cannot know what happened at the mediations themselves. However, they must have been conducted on the basis of the issues that were then in dispute in the proceedings. All I know is that:
the claim made by Stockco against Mr and Mrs Chalmers and the cross-claim made by Mr and Mrs Chalmers against Stockco have settled;
the claim then made by Mr and Mrs Chalmers against Elders was a derivative of the now settled claim against Mr and Mrs Chalmers by Stockco; and
now that orders have been made disposing of Stockco’s involvement in the proceedings, Mr and Mrs Chalmers seek to continue the proceedings by making fresh and different claims against Elders.
-
These matters point to the probability that, so far as Elders is concerned, its costs of attending the mediations were wasted and to the probability that the Court will, in due course, order a further mediation between Mr and Mrs Chalmers and Elders based on the claims now being articulated in the Amended Cross-Claim.
-
It may be that some of the work for the failed mediations will be of assistance to Elders in a future mediation. However, it does appear likely that the particular costs that Elders seeks to be included as costs thrown away, being the costs it paid to the earlier mediators, will be costs thrown away.
-
Accordingly, I order that the costs thrown away by reason of the amendment by the cross-claimants of their Cross-Summons and Cross-Claim Statement include the $15,769.16 (exclusive of GST) that the cross-defendant paid for their mediator’s fees and disbursements of the mediations of 6 May 2021 and 15 December 2022.
-
The other issue dividing the parties is whether the costs thrown away by the amendment to the cross-claim be payable forthwith.
-
As the proceedings are in the Commercial List, Practice Note SC Eq 3 applies. Paragraph 57 of that Practice Note provides that “unless otherwise ordered, a party in whose favour an order for costs is made may proceed to assessment of such costs forthwith”.
-
On the other hand, Uniform Civil Procedure Rules 2005 (NSW), r 42.7(2), provides that any costs of an interlocutory application “do not become payable until the conclusion of the proceedings” unless the “Court otherwise orders”.
-
As I have earlier observed,[1] although par 57 of the Practice Note directs attention to when costs of an interlocutory application may be assessed, as opposed to when those costs are paid, there would in most, if not all, cases be little point ordering that the costs the subject of an interlocutory costs order be assessed forthwith unless those costs were also payable forthwith.
1. G&S Engineering Services Pty Ltd v MACH Energy Australia Pty Ltd (No 2) [2019] NSWSC 463 at [7].
-
A basis to order that costs of an interlocutory dispute be payable forthwith can be where the costs are referable to completion of a discrete aspect of a case, and where “there is still some considerable distance to go in the litigation”. [2]
2. Ibid at [8] and see the cases cited therein.
-
That is the case here. The determination of Mr and Mrs Chalmers’ application for leave to file their Amended Cross-Claim resulted in a discrete and self-contained issue in the proceedings. The proceedings have been on foot for almost three years but, as between remaining parties, there is clearly “some considerable distance to go”. The pleadings are not closed. Elders is yet to serve substantially all of its evidence.
-
On behalf of Mr and Mrs Chalmers, it was submitted that the making of an order that the costs be payable forthwith “has the capacity to stultify proceedings in light of the financial hardship” of Mr and Mrs Chalmers. However, no recent evidence was adduced on behalf of Mr and Mrs Chalmers as to their financial position, nor as to how their settlement with Stockco has affected that financial position.
-
In these circumstances, I am persuaded that I should order that the cross-claimants should pay the first cross-defendant’s costs thrown away by reason of the amendment of the cross-claim, as agreed or assessed, and forthwith upon such agreement or assessment.
**********
Endnotes
Decision last updated: 12 July 2023
0
1
1