Vanguard Financial Planners Pty Ltd v Ale - [2017] NSWSC 196

Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Vanguard Financial Planners Pty Ltd v Ale [2017] NSWSC 196
Hearing dates: 6 March 2017
Date of orders: 06 March 2017
Decision date: 07 March 2017
Before: Gleeson JA
Decision:
The first defendant to pay the costs of the plaintiffs’ Notice of Motion dated 20 February 2017.

Catchwords: PROCEDURE – Costs – Interlocutory proceedings – where claim of privilege maintained in relation to subpoenaed documents – where consent orders permitting access ultimately made after complete capitulation of earlier held position – whether appropriate to order costs in favour of party filing motion to obtain access
Legislation Cited: Civil Procedure Act 2005 (NSW), s 56
Uniform Civil Procedure Rules 2005 (NSW), rr 42.1, 42.7
Cases Cited: Australian Securities and Investment Commission v Rich [2003] NSWSC 297
Gambro Pty Ltd v Fresenius Medical Care of Australia Pty Ltd [2002] FCA 581
R v Gold Coast City Council; Ex parte Raysun Pty Ltd [1971] QWN 13
Re The Minister for Immigration and Ethnic Affairs of the Commonwealth of Australia; Ex Parte Lai Qin (1997) 186 CLR 622
Category: Costs
Parties: Vanguard Financial Planners Pty Ltd ACN 143 411 689 (First plaintiff)
Mark Andrew Pauling (Second plaintiff)
Jason Ale (First Defendant)
Vanguard Accountants Pty Ltd ACN 117 612 316 (Second Defendant)
Representation:
Counsel:
N Avery-Williams (Plaintiffs)
S Tully (Defendants)
Solicitors:
Harris Wheeler Lawyers (Plaintiffs)
Roderick Storie Solicitors (Defendants)

File Number(s): 2016/106309

Judgment

GLEESON JA: By notice of motion filed 20 February 2017, the plaintiffs, Vanguard Financial Planners Pty Ltd and Mr Pauling, sought access to certain documents produced to the court on subpoena by Mr Crisp, an expert retained in the proceedings by the first defendant, Mr Ale. The access motion was returnable before the Court on 27 February 2017, when it was stood over to the Corporations Motions List on 6 March 2017. On that day, the parties reached agreement as to an access regime essentially in the terms sought by the plaintiffs in their motion. Those same terms had been proposed by the plaintiffs in correspondence with Mr Ale’s solicitors preceding the filing of the motion. The practical effect of the access orders made by consent on 6 March 2017 is that the plaintiffs will obtain access to a significant number of documents over which Mr Ale had previously made a claim for privilege.
There remains the issue of costs of the plaintiffs’ motion. The plaintiffs seek costs of the motion against Mr Ale. This is resisted by Mr Ale who submitted that there should be either no order as to costs, or alternatively costs should be costs in the cause.
The power to order costs is a discretionary power. The general rule as to costs is that costs follow the event unless it appears to the court that some other order ought to be made as to the whole or part of the costs: see r 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR). Rule 42.7 deals…

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: [2017] NSWSC 196
Decision Date: 07 March 2017

CaseChat Overview and Summary

In the Federal Court of Australia, the matter of Vanguard Financial Planners Pty Ltd v Ale involved a dispute concerning the costs associated with obtaining access to subpoenaed documents. Vanguard Financial Planners sought to access certain documents from Ale, which were claimed to be privileged. The matter proceeded to an interlocutory application where Vanguard Financial Planners sought an order that they should be permitted to inspect and obtain copies of the documents. The central legal issue before the court was whether, in circumstances where a claim of privilege was maintained throughout the proceedings but ultimately withdrawn after the consent orders were made, Vanguard Financial Planners were entitled to an order for costs.

The court considered the principle that costs should follow the event, but also the circumstances under which a party maintains a position of privilege before ultimately conceding access. The court noted that while Ale had initially resisted the disclosure, Vanguard Financial Planners had been compelled to make a formal application to enforce their rights. The court emphasised the importance of the principles of fairness and proportionality in determining costs in interlocutory proceedings. The court held that given the circumstances of the case, including the need for Vanguard Financial Planners to pursue formal legal proceedings to secure access to the documents, it was appropriate to order Ale to pay a portion of Vanguard Financial Planners' costs. The court's decision was based on the principle that where a party has maintained a position of privilege and subsequently capitulated, it may be appropriate to order costs in favour of the party that sought access.

The court made an order that Ale pay $10,000 towards Vanguard Financial Planners' costs. This amount was determined to be a reasonable reflection of the costs incurred by Vanguard Financial Planners in pursuing the interlocutory application, taking into account the circumstances of the case.

Orders