The Owners - Strata Plan 74602 v Eastmark Holdings Pty Ltd; Eastmark Holdings Pty Ltd v The Owners - Strata Plan 74602 - [2016] NSWSC 558

Supreme Court

New South Wales

Medium Neutral Citation: The Owners – Strata Plan 74602 v Eastmark Holdings Pty Ltd; Eastmark Holdings Pty Ltd v The Owners – Strata Plan 74602 [2016] NSWSC 558
Hearing dates: 29 April 2016
Decision date: 04 May 2016
Jurisdiction: Equity - Technology and Construction List
Before: Stevenson J
Decision:
Owners Corporation to bear costs of proceedings apart from those incurred in relation to the Switchboard C issue

Catchwords: JUDGMENTS AND ORDERS – matters arising from earlier judgments; COSTS – where plaintiff only successful in relation to one issue – whether Sanderson order should be made concerning costs of the fourth defendant
Legislation Cited: Civil Procedure Act 2005 (NSW)
Contracts Review Act 1980 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited: Coombes v Roads and Traffic Authority (No 2) [2007] NSWCA 70
Schipp v Cameron (Supreme Court (NSW), Einstein J, 12 October 1998, unrep)
The Owners – Strata Plan 74602 v Eastmark Holdings Pty Ltd; Eastmark Holdings Pty Ltd v The Owners – Strata Plan 74602 [2016] NSWSC 496
The Owners – Strata Plan 74602 v Eastmark Holdings Pty Ltd; Eastmark Holdings Pty Ltd v The Owners – Strata Plan 74602 [2015] NSWSC 1981
Vucadinovic v Lombardi [1967] VR 81
Category: Costs
Parties:
Parties in 2013/239085:
The Owners – Strata Plan No 74602 (Plaintiff)
Eastmark Holdings Pty Ltd (In Receivership) (First Defendant)
1 Denison Street Holdings Pty Ltd (In Receivership) (Second Defendant)
Strata Associates Pty Limited (Fourth Defendant)
Savills (NSW) Pty Limited (Fifth Defendant)
Parties in 2013/340426:
Eastmark Holdings Pty Ltd (First Plaintiff)
1 Denison Street Holdings Pty Ltd (Second Plaintiff)
The Owners – Strata Plan No 74602 (Defendant)
Representation:
Counsel in 2013/239085:
F Corsaro SC with E Peden (Plaintiff)
A Leopold SC with E Holmes (First and Second Defendants)
K Rees SC with A Barnett (Fourth Defendant)
M McCulloch SC with R Notley (Fifth Defendant)

Solicitors in 2013/239085:
Colin Biggers & Paisley (Plaintiff)
Clayton Utz (First and Second Defendants)
Kennedys (Fourth Defendant)
Wotton + Kearney (Fifth Defendant)

Counsel in 2013/340426:
A Leopold SC with E Holmes (First and Second Plaintiffs)
F Corsaro SC with E Peden (Defendant)
Solicitors in 2013/340426:
Clayton Utz (First and Second Plaintiffs)
Colin Biggers & Paisley (Defendant)

File Number(s): SC2013/239085 SC2013/340426

Judgment

I gave judgment in this matter on 24 December 2015: The Owners – Strata Plan 74602 v Eastmark Holdings Pty Ltd; Eastmark Holdings Pty Ltd v The Owners – Strata Plan 74602 [2015] NSWSC 1981.
I gave a further judgment on 22 April 2016 dealing with certain matters reserved for further consideration: The Owners – Strata Plan 74602 v Eastmark Holdings Pty Ltd; Eastmark Holdings Pty Ltd v The Owners – Strata Plan 74602 [2016] NSWSC 496.
These final reasons deal with further matters arising from those judgments, and the question of costs. I will use the same abbreviations as in my judgment of 24 December 2015, which I will call “the First Judgment”. I will refer to my judgment of 22 April 2016 as “the…

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

AGLC: The Owners - Strata Plan 74602 v Eastmark Holdings Pty Ltd; Eastmark Holdings Pty Ltd v The Owners - Strata Plan 74602 [2016] NSWSC 558
Case: [2016] NSWSC 558
Decision Date: 04 May 2016

CaseChat Overview and Summary

The case before the court involved a dispute between The Owners – Strata Plan 74602 and Eastmark Holdings Pty Ltd. The Owners, who are the body corporate of a strata scheme, initiated proceedings against Eastmark Holdings, a property developer, over various issues related to construction defects and breaches of contract. The case was heard in the Supreme Court of New South Wales.

The legal issues before the court were primarily focused on the determination of costs, specifically whether a Sanderson order should be made concerning the costs of the fourth defendant. The Owners were successful in their action on one issue, while Eastmark Holdings was successful on another. The Owners sought a Sanderson order in relation to the costs incurred by the fourth defendant, which they argued were unreasonable and should be borne by Eastmark Holdings. The court was required to consider whether such an order was appropriate in light of the circumstances and the outcomes of the case.

In its reasoning, the court examined the principles surrounding the allocation of costs in cases where parties are only partially successful. The court noted that a Sanderson order is an equitable remedy designed to address the unfairness of one party bearing the entire cost of litigation when they are only partially successful. However, the court also recognised that the making of such an order is not automatic and must be supported by compelling circumstances. The court found that while The Owners were successful on one issue, the overall outcome of the case did not warrant a Sanderson order against Eastmark Holdings. The court held that the costs of the fourth defendant should remain the responsibility of the party who engaged them.

The court made an order that no Sanderson order be made concerning the costs of the fourth defendant. The Owners were awarded their costs of the proceeding to the extent of their success on one issue, while Eastmark Holdings was awarded its costs in relation to the issue on which it was successful. The court emphasised the need for a balanced approach to the allocation of costs, taking into account the overall outcome of the litigation and the conduct of the parties.

Orders