Traderight (NSW) Pty Ltd & Ors v Bank of Queensland Ltd (No 2)

[2008] NSWSC 589

CITATION:	Traderight (NSW) Pty Ltd & Ors v Bank of Queensland Ltd (No 2) [2008] NSWSC 589
HEARING DATE(S):	Written submissions received 10 and 11 June 2008
JUDGMENT DATE :	12 June 2008
JURISDICTION:	Equity Division
JUDGMENT OF:	Palmer J
DECISION:	Defendant to pay Plaintiffs’ costs of motion on party/party basis; costs to be assessed and paid forthwith.
CATCHWORDS:	COSTS – Defendant’s motion failed on grounds pointed out by Plaintiffs prior to hearing – whether sufficient to warrant indemnity costs – lengthy and costly proceedings – Defendant better able to bear costs of litigation – whether Plaintiffs’ costs should be assessed and paid forthwith.
LEGISLATION CITED:	Industrial Relations Act 1996 (NSW) – s 106 Uniform Civil Procedure Rules 2005 (NSW) - 42.7(2)
CATEGORY:	Procedural and other rulings
CASES CITED:	- Fish v Solution 6 Holdings Ltd (2006) 225 CLR 180 - Traderight (NSW) Pty Ltd & Ors v Bank of Queensland Ltd - [2008] NSWSC 543
PARTIES:	Traderight (NSW) Pty Ltd (First Plaintiff) Bronwyn Smith (Second Plaintiff) Geoffrey Versace (Third Plaintiff) Smith Partners Developments Pty Ltd (Fourth Plaintiff) Verich Holdings Pty Ltd (Fifth Plaintiff) Bank of Queensland Ltd (Defendant)
FILE NUMBER(S):	SC 4284/07
COUNSEL:	N.A. Cotman SC (Plaintiffs) A.R. Moses (Defendant)
SOLICITORS:	McCabe Terrill (Plaintiffs) HWL Ebsworth (Defendant)

4284/07 Traderight (NSW) Pty Ltd & Ors v Bank of Queensland Ltd (No 2)

JUDGMENT
12 June, 2008

1 On 5 June 2008, I delivered reasons for judgment dismissing the Defendant’s motion to strike out those parts of the Plaintiffs’ Amended Statement of Claim which pleaded a claim founded on s 106 Industrial Relations Act 1996 (NSW): [2008] NSWSC 543. The parties wished to make detailed submissions as to costs. I directed that written submissions be provided and said that I would determine the costs issue without further oral submissions. 2 The Plaintiffs submit that the costs of the Defendant’s unsuccessful motion should be paid by the Defendant on the indemnity basis and that, in accordance with the power provided in UCPR 42.7(2), I should order that those costs be assessed and paid forthwith rather than at the conclusion of the proceedings, as would normally be the case. 3 The Plaintiffs submit that these orders are warranted because:


– the Plaintiffs repeatedly pointed out to the Defendant before the motion was brought on for hearing that the Defendant’s strike out application was premature and would fail, yet the Defendant pressed ahead with that application;

– the costs of this motion relate to a discrete and separately identifiable aspect of the proceedings;

– the proceedings are in their infancy and considerable time and money will have to be expended by both sides before the proceedings are concluded;

– the Defendant is far better able than the Plaintiffs to bear the continuing costs of the litigation, as the Defendant must have appreciated in bringing this application.

4    The Defendant submits that:


– there is no basis for an indemnity costs order because the Defendant’s case on the motion was not vexatious or hopeless and its conduct in prosecuting the motion was not unreasonable;

– the subject matter of the motion – i.e. the Plaintiffs’ claim for relief under s 106 – is not discrete from the relief sought by the Plaintiffs in the proceedings;

– the trial judge will be better able to make a decision as to the costs of the motion than I can this stage.

5 In my view, the Defendant should pay the Plaintiffs’ costs of the motion on the party/party basis, not on the indemnity basis, but those costs should be assessed and paid forthwith rather than at the conclusion of the proceedings. My reasons are as follows. 6 It is true that, having found that the Plaintiffs’ case on the s 106 claims was sufficiently arguable, I went on to conclude that the question of jurisdiction under s 106 Industrial Relations Act ought not to be determined on a final basis without a full hearing on the merits. The argument that the motion was premature was put to the Defendant by the Plaintiffs’ solicitors before the motion was brought on. However, I am unable to regard the Defendant’s submissions in support of the motion as so lacking in substance that responsible Counsel could not reasonably have put them. After all, it has not been unknown for the Courts to foreclose a claim under s 106 Industrial Relations Act for want of jurisdiction before a hearing on the merits. Fish v Solution 6 Holdings Ltd (2006) 225 CLR 180 was just such a case. In an area of the law which is developing apace, I preferred, as a trial judge, to proceed cautiously before making a final adjudication as to jurisdiction. However, an appellate court may venture to act more boldly – as this case may yet prove. 7 I accept the Plaintiffs’ submission that their costs of the motion ought to be paid now rather than at the conclusion of the proceedings. The motion raised a discrete issue: it was not whether the Plaintiffs’ claim under s 106 Industrial Relations Act would succeed or fail but whether, at this stage of the proceedings, the claims were demonstrably untenable and whether other discretionary factors weighed in favour of striking them out. The Plaintiffs succeeded on that issue and that issue has been finally determined subject, of course, to an appeal. 8    Further, I accept that this litigation will be complex, lengthy and expensive. So much is obvious from the Amended Statement of Claim. I do not think it could reasonably be gainsaid that the Bank would be in a better position than the Plaintiffs to bear the ongoing costs of that litigation until its conclusion. I see no reason why the costs burdens on the Plaintiffs should be increased by withholding payment of costs to which they are entitled, possibly for a very long time indeed. 9    I do not think that I am bound to find, in addition to the above reasons, some unreasonable conduct on the Bank’s part in bringing the motion before exercising in favour of the Plaintiffs the Court’s discretion as to the time for payment of costs of the motion. In my view, the factors to which I have referred are sufficient in themselves to warrant the order which the Plaintiffs seek. 10    I order that the Defendant pay the Plaintiffs’ costs of the Defendant’s Notice of Motion filed on 11 December 2007 and of its Amended Notice of Motion filed in Court on 16 May 2008. I order that those costs be assessed and paid forthwith.
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