Tout v Johnson (No 2)

[2021] NSWSC 1543

Supreme Court

New South Wales

Medium Neutral Citation:

Tout v Johnson (No 2) [2021] NSWSC 1543

Hearing dates:

On the papers

Date of orders:

30 November 2021

Decision date:

30 November 2021

Jurisdiction:

Equity

Before:

Darke J

Decision:

See at [9] and [13].

Catchwords:

COSTS – departure from the general rule – where plaintiff unsuccessful in obtaining relief at final hearing – whether costs of various interlocutory applications warrant a departure from the general rule – held that some departure warranted – order that defendants pay certain costs and otherwise that the plaintiff pay the costs of the proceedings

COSTS – gross sum order – held the evidence does not establish likelihood that the plaintiff will be unable to pay defendants’ costs once assessed – held that evidence does not place Court in position to be confident it could resolve challenges about amount of costs on a fair and logical basis – gross sum costs order declined

Legislation Cited:

Civil Procedure Act 2005 (NSW), s 98(4)(c)

Conveyancing Act 1919 (NSW), s 88K

Cases Cited:

Tout v Johnson [2021] NSWSC 1311

Category:

Costs

Parties:

Michelle Tout (Plaintiff)
Brendan Charles Johnson (First Defendant)
Jodie Gail Williams (Second Defendant)
The Office of the Registrar-General (Third Defendant)

Representation:

Counsel:
Mr A Joseph (Plaintiff)
Mr S Lipp (First and Second Defendants)

Solicitors:
Lindeman Lawyers (Plaintiff)
Downeys Lawyers Pty Ltd (First and Second Defendants)

File Number(s):

2019/375183

Publication restriction:

None

Judgment

1. Judgment was given in this matter on 14 October 2021 (see Tout v Johnson [2021] NSWSC 1311 – “the principal judgment”). The Court rejected the plaintiff’s remaining claim for relief, being the imposition of an easement pursuant to s 88K of the Conveyancing Act 1919 (NSW). This judgment, which should be read in conjunction with the principal judgment, concerns the costs of the proceedings.

2. Subject to two exceptions, the plaintiff accepts that it is appropriate for costs to follow the event. The two exceptions are:

1. the costs of the plaintiff’s application for interlocutory relief made at the time the proceedings were commenced in November 2019; and

2. the costs of the various applications that were brought in April 2021 following the washing away of the access track at the creek crossing on the defendants’ land.

3. The plaintiff submits that she should obtain costs orders in her favour in relation to these matters, or alternatively that there should be no orders for costs in relation to them.

4. The defendants press for an order that the plaintiff pay their costs of the whole proceedings. In addition, the defendants seek a gross sum costs order pursuant to s 98(4)(c) of the Civil Procedure Act 2005 (NSW).

5. The question of costs has been dealt with on the papers. The plaintiff relied upon written submissions dated 22 October 2021 and 19 November 2021 (in reply), and an affidavit of Matthew Lindeman, solicitor, of 19 November 2021. The defendants relied upon written submissions dated 31 October 2021, and an affidavit of David Downey, solicitor, of 28 October 2021.

6. As for (1), the plaintiff submitted that the need for the interlocutory application was brought about by the conduct of the defendants in blocking the access track which the plaintiff had been using for many years. The plaintiff further submitted that whilst she had made a request on 21 November 2019 for access to be granted on a temporary basis, the defendants did not respond until 28 November 2019 when consent was given to an access regime that was encapsulated in consent orders made on that day by Kunc J. These matters may be accepted. It is inescapable, however, that the interlocutory application was made in aid of the plaintiff’s claim to final relief which ultimately failed. Indeed, the initial claim was based only on an alleged contractual right to use the access track, which right was not pressed at the final hearing. The only claim pressed at the final hearing was the claim under s 88K of the Conveyancing Act. I agree with the submissions of the defendants that the costs of the interlocutory application should not be regarded as separate from the other costs of the proceedings, and should follow the event in the usual course.

7. As for (2), the plaintiff submitted that the various motions (her motion for contempt, and the competing motions of the parties in relation to the continuation or variation of the consent orders made by Kunc J) were the result of a clear breach by the defendants of the orders of the Court by locking the gates to the access track. The plaintiff submitted that even though the motions were not determined following a hearing on the merits, the defendants’ conduct made it appropriate for a costs order to be made in favour of the plaintiff, and it was in any event difficult to see how the defendants could argue that they did not breach the orders. The defendants took issue with that. I note that the defendants did not in their affidavits deny that the gates were locked, but suggested that those actions were justified by a concern that continued use of the access track would not be safe and could expose them to liability. Nevertheless, accepting that the washing away of the creek crossing presented a difficult situation that required prompt attention, it would have been preferable for the defendants to raise the matter with the plaintiff (or have their solicitors raise the matter with the plaintiff’s solicitors), rather than unilaterally take the steps they did. I think that the conduct of the defendants (whether a breach of the Court’s orders or not – about which question I express no view) can be seen to have precipitated the flurry of interlocutory activity in April 2021 that may have been wholly or largely avoided if a more co-operative course was taken.

8. In these circumstances, I think that it would be appropriate to order that the defendants pay the plaintiff’s costs of and associated with the appearances on 15 April 2021, 21 April 2021 and 30 April 2021 when the various motions were before the Court (leading to the making of consent orders on 30 April 2021). However, those costs should not include the costs of the plaintiff’s affidavits of 6 April 2021 and 20 April 2021 as those affidavits were read by the plaintiff at the final hearing. I note that the affidavits sworn by each defendant on 19 April 2021 were read by them at the final hearing also. There is no reason why the defendants should not have their costs in relation to those affidavits.

9. For the above reasons, the appropriate orders for costs (up to the present costs applications) are in my opinion:

1. an order that the defendants pay the plaintiff’s costs of and associated with the appearances on 15 April 2021, 21 April 2021 and 30 April 2021, not including the costs of the plaintiff’s affidavits of 6 April 2021 and 20 April 2021; and

2. an order that otherwise the plaintiff pay the defendants’ costs of the proceedings (including the costs associated with the affidavits sworn by each defendant on 19 April 2021).

10. I turn now to the question whether an order should be made that the defendants are entitled to a specified gross sum instead of assessed costs in respect of the costs order in their favour.

11. The basis for such an order is expressed to be a concern that the plaintiff might not be able to meet a costs order at the conclusion of an assessment. Reference is made to certain evidence adduced at the hearing concerning the plaintiff’s financial position. That evidence was very general in nature, to the effect that she does not have significant assets apart from her property at Yarras, and that her financial position is “not great”. The evidence was given in the context of an estimated cost of more than $200,000 to construct a new road access across her property.

12. I do not think that the evidence establishes a likelihood that the plaintiff will be unable to pay the defendants’ costs once assessed. In addition, there are some aspects of the amount of costs claimed by the defendants that are sought to be challenged by the plaintiff. It would be appropriate for challenges of that type to be dealt with by an experienced costs assessor if a satisfactory agreement cannot be reached between the parties. The evidence before the Court does not place the Court in a position to be confident that it could resolve those challenges on a fair and logical basis. In these circumstances, I decline to make an order for gross sum costs.

13. As neither party can be regarded as the successful party on the present costs applications, the Court will order that each party bear its own costs of the applications for costs.

14. Finally, the Court will dismiss the plaintiff’s Notices of Motion filed on 9 April 2021 and 16 April 2021, and the defendants’ Notice of Motion filed on 16 April 2021. Further, whilst not strictly necessary, the Court will also order that Order 3 made by Kunc J on 28 November 2019 be discharged.

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Decision last updated: 30 November 2021