Tan v The Owners Strata Plan 22014 (No 3) - [2016] NSWSC 896

Supreme Court

New South Wales

Medium Neutral Citation: Tan v The Owners Strata Plan 22014 (No 3) [2016] NSWSC 896
Hearing dates: On the papers
Date of orders: 28 June 2016
Decision date: 28 June 2016
Jurisdiction: Equity
Before: Robb J
Decision:
See par 34 and 35

Catchwords: COST ORDERS – third defendant sought indemnity from the first defendant owners corporation for her costs of the proceedings – first defendant was not initially capable of opposing plaintiffs’ application for leave to take proceedings in the name of the first defendant – court of its own motion joined the third defendant as a party to plaintiffs’ application – exceptional circumstances – principles of justice and fairness considered – court had already ordered the first defendant to indemnify the plaintiffs for their costs HELD court exercised discretion as to costs under Civil Procedure Act 2005 (NSW), s 98 – first defendant to pay third defendant indemnity costs properly related to the third defendant responding to the plaintiffs’ application
Legislation Cited: Civil Procedure Act 2005 (NSW)
Cases Cited: Oates v Consolidated Capital Services Ltd [2009] NSWCA 183; (2009) 76 NSWLR 69
Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin [1997] HCA 6
Tan v The Owners Strata Plan 22014 (No 2) [2015] NSWSC 1920
Owners Strata Plan No 68372 v Allianz Australia Insurance Ltd (No 2) [2015] NSWSC 729
Wallersteiner v Moir (No 2) [1975] QB 373
Texts Cited: Ritchie’s Uniform Civil Procedure NSW
Category: Costs
Parties: Patrick Tian Teng Tan (first plaintiff)
Ian Paterson Walters (second plaintiff)
Rose Sok Kio Tan (third plaintiff)
Owners Corporation Strata Plan No 22014 (first defendant)
Whelan Property Group Pty Ltd (second defendant)
Janette Daisy Porter (third defendant)
Representation:
Counsel: N Cotman SC (plaintiffs)
D Russell (solicitor) (first and second defendants)
D Hand (third defendant)
Solicitors: Terrett Lawyers (plaintiffs)
Chambers Russell Lawyers (first and second defendants)
Mills Oakley Lawyers (third defendant)

File Number(s): 2014/176516
Publication restriction: None

Judgment

On 17 December 2015, I published reasons for judgment in these proceedings on a number of costs questions: see Tan v The Owners Strata Plan 22014 (No 2) [2015] NSWSC 1920.
The reasons were primarily concerned with an application by the plaintiffs that the first defendant, the Owners Corporation, indemnify them in respect of their costs of the proceedings.
The plaintiffs made their application on the basis of the principle considered by the English Court of Appeal in Wallersteiner v Moir (No 2) [1975] QB 373. I considered the relevant legal principles at [90] to [118] of the earlier reasons.
Ordinarily, when an application is made that a corporation indemnify plaintiffs, who have commenced proceedings for the benefit of the corporation, or its members generally, in respect of their costs of the proceedings, there is a natural contradictor to the plaintiffs’ application. In most cases, the natural contradictor will be the person or group who control the corporation, or who are members of the corporation who have taken some course in opposition to…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2016] NSWSC 896
Decision Date: 28 June 2016

CaseChat Overview and Summary

In the case of Tan v The Owners Strata Plan 22014 (No 3), the plaintiff, Tan, brought proceedings against the first defendant, the owners corporation of a strata plan, in relation to a dispute concerning strata titles. The third defendant, who was not initially a party to the proceedings, sought an indemnity from the first defendant for the costs incurred in responding to the plaintiff's application for leave to take proceedings in the name of the first defendant. The court had already ordered the first defendant to indemnify the plaintiffs for their costs, and the third defendant argued that exceptional circumstances justified her seeking indemnity from the first defendant.

The primary legal issue was whether the third defendant was entitled to an indemnity for costs from the first defendant, given that the first defendant was initially incapable of opposing the plaintiff's application for leave. The court had to determine if the circumstances were exceptional enough to warrant such an indemnity, considering the principles of justice and fairness. The court was also required to assess if the third defendant's response to the plaintiff's application was properly related to the proceedings.

In resolving the matter, the court exercised its discretion under section 98 of the Civil Procedure Act 2005 (NSW) and found that the first defendant was to indemnify the third defendant for costs properly related to the third defendant responding to the plaintiffs' application. The court considered the exceptional circumstances and the principles of justice and fairness in making its decision. The court concluded that the third defendant's costs were properly related to the proceedings, and therefore, the first defendant was to indemnify the third defendant for those costs. The court's decision was based on the unique circumstances of the case and the need to ensure fairness in the allocation of costs.

Orders