Vyncan Pty Ltd v Vannella Dairy Distribution Pty Ltd
[2009] QDC 235
•6 August 2009
DISTRICT COURT OF QUEENSLAND
CITATION:
Vyncan Pty Ltd v Vannella Dairy Distribution Pty Ltd [2009] QDC 235
PARTIES:
VYNCAN PTY LTD
Applicant/appellant
V
VANNELLA DAIRY DISTRIBUTION PTY LTD
Respondent
FILE NO/S:
Cairns 19 of 2009
DIVISION:
Appellate
PROCEEDING:
Originating Application
ORIGINATING COURT:
Magistrates court of Queensland, Cairns
DELIVERED ON:
6 August 2009
DELIVERED AT:
Maroochydore
HEARING DATE:
24 June 2009; further written submissions received up to 10 July 2009
JUDGE:
Alan Wilson SC, DCJ
ORDER:
1 Amend the first order made on 24 June 2009 by:
(a) deleting the reference to paragraph 3(a)(i)(2) and inserting in lieu thereof ‘paragraphs 2 (c) and 2 (d)’
(b) deleting the reference to 23 April 2009 and inserting in lieu thereof ‘23 January 2009’
2 The orders of the learned Magistrate made on 19 December 2008 and 2 February 2009 are set aside
3 The appeal is allowed in respect of the ground set out in paragraph 1 of the order made on 24 June 2009, as amended pursuant to order 1 above
4 In lieu of the orders of the learned Magistrate referred to in order 2 above it is ordered that:
(a) part of the appellant/applicant’s claim relating to materials allegedly supplied and work allegedly done by it for and at the request of the respondent is dismissed
(b) the respondent is liable to pay applicant appellant, upon the true construction of the commercial tenancy agreement entered into between them on or about 5 April 2005, an amount on account of outgoings calculated at fifty percent of the charges and levies described in paragraph 4.2 of that agreement in respect of the whole of the property located at the corner of Hollingworth and Lyons Streets, Cairns and described in the agreement as Proposed Lot 50 on SP 177754
(c) the applicant appellant pay two-thirds of the respondent’s costs of and incidental to the action below, assessed on the standard basis
(d) each party bear its own costs of and incidental to the application for leave to appeal, and this appeal
CATCHWORDS:
COSTS – where applicant succeeded in one of two applications – whether Calderbank offer made by applicant to respondent in proceedings in the court below should affect costs order – whether order for costs should be made in relation to a particular question in a proceeding
Uniform Civil Procedure Rules r 681, r 684, r 766, r 785
Case considered:
Thiess v TCN Channel Nine Pty Ltd (No 5) (1994) 1 Qd R 156COUNSEL:
M Jonsson for applicant
J Trevino for respondentSOLICITORS:
Daniel Towne and Associates for applicant
Williams Graham Carman for respondent
[1] In Reasons for Judgment delivered at Cairns on 24 June 2009 I determined that the appellant Vyncan Pty Ltd ought to have leave to appeal, and its appeal should succeed, on one of the two grounds upon which it challenged a decision of the Magistrates Court.
[2] The two grounds were referred to in the Reasons as the ‘works’ issue and the ‘outgoings’ issue. Vyncan succeeded only on the latter. At the time the Reasons were delivered the parties were directed to provide further written submissions about costs, and the appropriate form of order.
[3] There are also two aspects of the Reasons which, as subsequent written submissions from the parties reveal, were incorrect. The first concerns a reference, in those reasons, to paragraph 3(a)(i)(2) of the Notice of Appeal attached to Vyncan’s application for leave to appeal filed 23 April 2009 which, the parties agree, should correctly refer to the grounds set out in 2(c) and 2(d) of the Notice of the Appeal appended to Vyncan’s Originating Application filed 23 January 2009.
[4] The second matter concerns orders made in the Magistrates Court. When the appeal was heard in Cairns on 15 June 2009 nothing in the material or submissions alerted me to the fact that, after delivering reasons for judgment on 19 December 2008, the learned Magistrate later received submissions about costs and, on 2 February 2009 ordered that Vyncan pay Vannella Dairy’s costs assessed on the standard basis until 28 April 2008 and, thereafter, on an indemnity basis; and, that Vannella Dairy pay Vyncan the sum of $683.26.
Costs
[5] The learned Magistrate’s decision about costs was apparently influenced by a ‘Calderbank offer’ made by Vannella Dairy to Vyncan on 28 April 2008. The offer was in terms more favourable than the result for Vyncan at trial (where it failed altogether) but, because Vyncan has now been successful on the ‘outgoings’ issue on appeal, it has achieved a result more satisfactory to it than that proposed in the offer. For that reason, I do not think the terms of the offer ought now influence the costs orders here, or in the Magistrates Court.
[6] For Vyncan, it is contended that because it has now partially succeeded in both proceedings, it should have the costs of both. Reliance is placed upon rule 681 of the Uniform Civil Procedure Rules under which costs ordinarily follow the event. For Vannella Dairy it is submitted, conversely, that because most of the hearing time in the Magistrates Court and in this Court was taken up with the ‘works’ issue on which it has succeeded wholly on both occasions that outcome is, in truth, the ‘event’ which should dictate a costs order wholly in its favour.
[7] Under rule 684 the Court may make an order for costs in relation to a particular question in, or a particular part of, a ‘proceeding’ – a term which is not defined in the Dictionary to the Uniform Civil Procedure Rules (Schedule 4) but, in light of the terms of Chapter 2 Part 1 of those rules, plainly includes appellate proceedings. In any event the matter is put beyond doubt by rules 785 and 766 under which this Court may make an order as to the whole or part of the costs of an appeal, as it considers appropriate.
[8] The reasons of the learned Magistrate delivered on 19 December 2008 run, effectively to some 28 pages in which the ‘works’ and ‘outgoings’ issues are addressed, but the latter takes up only the last two pages and, as the learned Magistrate remarked at page 26, little evidence was called in respect of it. The same may be said about the appeal here in which the ‘outgoings’ issue involved, effectively, nothing more than written submissions upon the proper approach to construction of the agreement between the parties, and its meaning and effect.
[9] In Thiess v TCN Channel Nine Pty Ltd (No 5) (1994) 1 Qd R 156 the Full Court (McPherson SPJ, Moynihan J, Byrne J) considered the proper approach to be followed by a Court in defining particular questions and awarding costs connected with them. Thiess was a defamation action in which some 21 imputations were considered, and the defendant succeeded in proving truth in the case of 13 of them. Nevertheless, the trial Judge apportioned two thirds of the costs to the plaintiff.
The Court of Appeal thought, however, that the 13 points on which the defendant succeeded were important, and the most serious of the issues at trial, and changed the order so that the plaintiff actually paid one third of the defendant’s costs.
The ‘works’ issue involved detailed evidence and lengthy consideration by the Magistrate, and took up most of the hearing time on appeal; the ‘outgoings’ issue was a simple construction point. Vyncan failed on the ‘works’ issue which took up most of the trial, and much the greater part of the learned Magistrate’s reasons for judgment – and, also, both the argument and the subsequent reasons delivered here. Proportionally, the ‘outgoings’ issue, on which it succeeded here, can only be said to have required, at the most, a small proportion of the attention of the two courts which have addressed the matter.
That said Vyncan was, of course, obliged to appeal to achieve the result to which I think it was entitled on the ‘outgoings’ issue and the costs of the appeal were to that extent justified.
These conclusions dictate that costs may be fairly apportioned, and the outcome of the proceedings in the Magistrates Court and here justly reflected, if an order is made that Vyncan pay two-thirds of Vannella Dairy’s costs of and incidental to the action below, assessed on the standard basis; and, if each party bears its own costs of the application for leave to appeal, and the appeal.
Further Order on the ‘Outgoings’ issue
The parties are in agreement that the findings made on appeal dictate an order, in the form of declaratory relief, that Vannella Dairy is liable to pay Vyncan, upon the true construction of the commercial tenancy agreement entered into between them on or about 5 April 2005, an amount on account of outgoings calculated at fifty percent of the charges and levies described in paragraph 4.2 of that agreement in respect of the whole of the property located at the corner of Hollingworth and Lyons Streets, Cairns and described in the agreement as Proposed Lot 50 on SP 177754.
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