Sunlea Enterprises Pty Ltd as trustee for Drummond Cove Unit Trust v Pollock
[2014] WASC 91 (S)
•28 MAY 2014
SUNLEA ENTERPRISES PTY LTD AS TRUSTEE FOR DRUMMOND COVE UNIT TRUST -v- POLLOCK [2014] WASC 91 (S)
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2014] WASC 91 (S) | |
| Case No: | CIV:2705/2012 | 9 MAY 2014 | |
| Coram: | ALLANSON J | 28/05/14 | |
| 7 | Judgment Part: | 1 of 1 | |
| Result: | Plaintiff to pay defendants' costs of each application Special costs orders made | ||
| B | |||
| PDF Version |
| Parties: | SUNLEA ENTERPRISES PTY LTD AS TRUSTEE FOR DRUMMOND COVE UNIT TRUST JAMIE KEVIN POLLOCK LASERBASE PTY LTD CARINA LEE-ANNE HEALEY AIK CORPORATION PTY LTD KEVIN BARRY TERRANCE HEALEY TREVOR STANLEY JOHN BETTS MICHAEL IAN LURIE JAMES MALCOLM FREMANTLE DREAMVIEW INVESTMENTS PTY LTD IN ITS OWN RIGHT TRUSTEE FOR THE DREAMVIEW TRUST PROMENADE INVESTMENTS PTY LTD AS TRUSTEE FOR THE DREAMVIEW UNIT TRUST WALTHAMSTOW PTY LTD STEVEN ALICK MASEL TROIKA CAPITAL PTY LTD HOWARD FRANSZ |
Catchwords: | Practice and procedure Costs Defendants' applications for costs following successful security for costs applications Whether special costs order should be made Turns on own facts |
Legislation: | Legal Practitioners (Supreme Court) (Contentious Business) Determination 2012 (WA) Legal Profession Act 2008 (WA), s 280 Rules of the Supreme Court 1971 (WA), O 1 r 4A, O 1 r 4B, O 66 r 10(1) |
Case References: | Nil |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
JAMIE KEVIN POLLOCK
First Defendant
LASERBASE PTY LTD
Second Defendant
CARINA LEE-ANNE HEALEY
Third Defendant
AIK CORPORATION PTY LTD
Fourth Defendant
KEVIN BARRY TERRANCE HEALEY
Fifth Defendant
TREVOR STANLEY JOHN BETTS
Sixth Defendant
MICHAEL IAN LURIE
Seventh Defendant
JAMES MALCOLM FREMANTLE
Eighth Defendant
DREAMVIEW INVESTMENTS PTY LTD IN ITS OWN RIGHT TRUSTEE FOR THE DREAMVIEW TRUST
Ninth Defendant
PROMENADE INVESTMENTS PTY LTD AS TRUSTEE FOR THE DREAMVIEW UNIT TRUST
Tenth Defendant
WALTHAMSTOW PTY LTD
Twelfth Defendant
STEVEN ALICK MASEL
Thirteenth Defendant
TROIKA CAPITAL PTY LTD
Fourteenth Defendant
HOWARD FRANSZ
Fifteenth Defendant
Catchwords:
Practice and procedure - Costs - Defendants' applications for costs following successful security for costs applications - Whether special costs order should be made - Turns on own facts
Legislation:
Legal Practitioners (Supreme Court) (Contentious Business) Determination 2012 (WA)
Legal Profession Act 2008 (WA), s 280
Rules of the Supreme Court 1971 (WA), O 1 r 4A, O 1 r 4B, O 66 r 10(1)
Result:
Plaintiff to pay defendants' costs of each application
Special costs orders made
Category: B
Representation:
Counsel:
Plaintiff : Ms M Chaar
First Defendant : Mr D Bedenham
Second Defendant : Mr D Bedenham
Third Defendant : No appearance
Fourth Defendant : Mr D Bedenham
Fifth Defendant : Mr D Bedenham
Sixth Defendant : Mr P Lafferty
Seventh Defendant : Mr C S Williams
Eighth Defendant : Mr R A Zilkens
Ninth Defendant : Mr D Bedenham
Tenth Defendant : No appearance
Twelfth Defendant : Mr S J Davies
Thirteenth Defendant : Mr S J Davies
Fourteenth Defendant : Mr S J Davies
Fifteenth Defendant : Mr S J Davies
Solicitors:
Plaintiff : Tottle Partners
First Defendant : Birman & Ride
Second Defendant : Birman & Ride
Third Defendant : No appearance
Fourth Defendant : Birman & Ride
Fifth Defendant : Birman & Ride
Sixth Defendant : Kings Park Corporate Lawyers
Seventh Defendant : Solomon Brothers
Eighth Defendant : Zilkens & Co
Ninth Defendant : Birman & Ride
Tenth Defendant : No appearance
Twelfth Defendant : Taylor Smart
Thirteenth Defendant : Taylor Smart
Fourteenth Defendant : Taylor Smart
Fifteenth Defendant : Taylor Smart
Case(s) referred to in judgment(s):
Nil
1 ALLANSON J: On 21 March 2014 I ordered the plaintiff to give security for costs in relation to eight of the 14 defendants. The other defendants did not seek security.
2 Those defendants who were successful in their application now ask for orders that the plaintiff pay the costs of the applications, and that the costs be payable forthwith. With one exception, they seek special costs orders to permit costs to be taxed without limit to the number of hours fixed in the Legal Practitioners (Supreme Court) (Contentious Business) Determination 2012 (WA), made under the Legal Profession Act 2008 (WA).
3 These applications raise a difficult balancing exercise. There are several factors in favour of making the orders sought.
4 First, in my opinion, it is appropriate to order that the defendants have the costs of the applications. There was no real dispute that the threshold question in s 1335 of the Corporations Act 2001 (Cth) had been met. The plaintiff opposed the applications for security on discretionary grounds, including that the defendants had caused its impecunious position, and that the application was likely to stultify the claim.
5 Second, the defendants were put to the expense of responding to the allegation that they had caused the plaintiff's impecuniosity, which required that they address both the pleading and some factual material that the plaintiff put forward.
6 Third, on the issue of whether the order for security was likely to stultify its claim, the plaintiff did not put forward adequate evidence. In making my decision, I was unable to conclude whether those who stand behind the plaintiff, and stand to gain in this action should it succeed, could provide security, or indeed meet any costs order I now make. I am still in that position. On the evidence that has been presented to date, I cannot assume that the plaintiff would be unable to meet an order that it pay the costs of the applications.
7 The question of whether costs should be ordered to be paid forthwith raises additional issues. Order 66 r 10(1) of the Rules of the Supreme Court 1971 (WA) provides that costs may be dealt with by the court at any stage of the proceedings, and the court may order the costs to be paid forthwith notwithstanding that the proceedings are not concluded. Consolidated Practice Direction 4.7.1, relating to the costs of interlocutory applications, provides a general rule that where an order for costs is to be made against a party in interlocutory proceedings, the costs will be fixed and ordered to be paid forthwith or by a particular date. Consolidated Practice Direction 4.7.1 is a departure from the historical practice of ordering costs to be paid in any event. It states that the departure was because the historical practice does not sufficiently serve the purpose of discouraging ill-considered or needless interlocutory applications.
8 Although the Consolidated Practice Direction refers to the fixing of costs, there are several cases where orders have been made for costs to be taxed or agreed and paid forthwith in interlocutory applications. So, the normal practice in this list is to order that costs be paid forthwith, and, preferably but not invariably, that they be fixed.
9 Finally, the costs now sought by the defendants, on a rough calculation, are about a third of the amount of the security which I have ordered. In ordering the amount of security, I did so prospectively to an identified milestone. I accept that, in bringing the application for security, the defendants have incurred costs which deplete the resources available to them to defend the serious allegations.
10 On the other hand, I do not regard the application for security, and the opposition to it, as either ill-considered or needless. The fact that I found against the plaintiff does not mean that its opposition was properly described by either of those adjectives, and that the only reasonable course was to negotiate an amount for the security sum.
11 Next, the proportion of the costs already incurred to the security ordered could be met in other ways. The orders made anticipate that there will be an order for further security at a future time. There is also an unresolved issue regarding whether Mr Steinier should be ordered to indemnify the plaintiff, the action being his action although brought in the plaintiff's name. I do not have enough information to make an assessment of his capacity to indemnify the plaintiff because his evidence on the application for security was short on detail. Mr Steinier has, however, indicated his willingness to indemnify the plaintiff.
12 Further, there is a real issue of resources, particularly for the parties but also for the court, when the effect of the orders sought will be four taxations at an interlocutory stage in this matter. This would be exacerbated by any order (sought by three of the parties) that there be a special order regarding costs so that the taxing officer may tax costs without regard to the hourly limit in the determination.
13 I am satisfied that this is a matter which comes within s 280 of the Legal Profession Act, where a special costs order may be made where a judicial officer is of the opinion that the amount of costs allowable in respect of a matter under a costs determination is inadequate because of the unusual difficulty, complexity or importance of the matter. The relevant item in the determination, for an application in chambers, allows for two days preparation and a one day hearing. But, in my opinion, it is at least fairly arguable that the costs allowed in the determination are inadequate where the defendants were required to respond to the plaintiff's allegation that its impecuniosity was caused by their conduct. Having regard to the many allegations in the statement of claim, the seriousness of several of them, and the volume of evidence adduced on the application I believe this is a proper case under s 280 to make a special costs order.
14 Taking all of these matters into consideration, I believe that the course most consistent with O 1 r 4A and 4B of the Rules of the Supreme Court and the interests of justice is to order that the plaintiff pay the defendants' costs of each application, the costs to be taxed without limit by the number of hours fixed in item 10(a) of the Legal Practitioners (Supreme Court) (Contentious Business) Determination, and payable by the plaintiff in any event.
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