WOHB Pty Ltd v Williams (No. 2)

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DISTRICT COURT OF QUEENSLAND

CITATION:

WOHB Pty Ltd v Williams & Anor (No. 2) [2024] QDC 209

PARTIES:

WOHB PTY LTD

(ACN 624 271 969)
(plaintiff)
v
JUSTIN GREGORY WILLIAMS AS TRUSTEE OF THE WILLIAMS FAMILY TRUST
(first defendant)
and

ANITA MARIA NIVALA AS TRUSTEE OF THE WILLIAMS FAMILY TRUST
(second defendant)

FILE NO:

1380/19

DIVISION:

Trial

PROCEEDING:

Civil

ORIGINATING COURT:

District Court, Brisbane

DELIVERED ON:

13 December 2024

DELIVERED AT:

Brisbane

HEARING DATE:

9 September 2024 (re costs)

JUDGE:

Dearden DCJ

ORDER:

1.   I order that WOHB Pty Ltd, Mitchell Robert McIlwain and Graeme William McIlwain pay the defendants’ costs of the proceedings on an indemnity basis, fixed at $182,826.95.

CATCHWORDS:

COSTS APPLICATION – whether costs should be awarded on a standard basis or an indemnity basis – whether costs should be awarded against the plaintiff and the director of the plaintiff – whether, in addition to costs ordered against the plaintiff and the director of the plaintiff, costs should also be awarded against a non-party

LEGISLATION:

Uniform Civil Procedure Rules 1999 (Qld) rr 681 & 702

CASES:

Colgate Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225
WOHB Pty Ltd v Williams & Anor [2024] QDC 94
Kozak v Matthews & Anor [2007] QSC 204
Manly v The Public Trustee of Queensland (No. 2) [2008] QSC 47
J & D Rigging Pty Ltd v Agripower Australia Limited & Ors [2014] QCA 23
Calderbank v Calderbank [1976] Fam 93
Trouton v Trouton & Anor (No. 3) [2024] QSC 54
Knight v FP Special Assets Ltd (1992) 174 CLR 178
SJG Developments Pty Ltd v NT Two Nominees Pty Ltd (in liq) [2020] QSC 104
Jones & Anor v Aussie Networks Pty Ltd & Ors [2019] QSC 111
Dwyer v Nel [2021] QCA 165

FPM Constructions v Council of the City of Blue Mountains [2005] NSWCA 340
COUNSEL:

S Fisher for the plaintiff

R Ivessa for the first and second defendants
SOLICITORS:

Stolar Law for the plaintiff

Mullins Lawyers for the first and second defendants

  1. The first and second defendants, Justin Gregory Williams and Anita Maria Nivala, were successful at trial both in their defence of the plaintiff WOHB Pty Ltd’s claim and in their counterclaim.[1]

  2. The defendants, in an application filed 4 July 2024, seek orders for costs on an indemnity basis against the plaintiff, Mitchell Robert McIlwain and Graeme William McIlwain on an indemnity basis; alternatively that the plaintiff and Graeme William McIlwain pay the defendants’ costs on an indemnity basis; alternatively the plaintiff and Mitchell Robert McIlwain pay the defendants’ costs on an indemnity basis; or finally, in the alternative, that the plaintiff pay the defendants’ costs on an indemnity basis.[2]

    [2]Application filed 4 July 2024.

  3. The defendants were wholly successful at trial and the default order that follows would ordinarily be an order that the plaintiff pay the defendants’ costs on a standard basis unless the court orders otherwise.[3]

    [3]Uniform Civil Procedure…

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Details
Case
[2024] QDC 209
Decision Date

CaseChat Overview and Summary

The matter of WOHB Pty Ltd v Williams (No. 2) involved a costs application following a comprehensive litigation process, where the plaintiff, WOHB Pty Ltd, along with its director Mitchell Robert McIlwain, faced allegations of misconduct in the proceedings against the defendants. The case was before the court to decide on the basis for awarding costs, whether on a standard or indemnity basis, and to determine if costs should be awarded against the plaintiff, its director, and potentially a non-party. The court was also tasked with assessing the implications of the plaintiff's fraudulent misrepresentation claims, which were deemed baseless, and other contentious allegations that unnecessarily complicated the litigation process.

The central legal issues before the court revolved around the assessment of costs under the Uniform Civil Procedure Rules and the inherent jurisdiction to manage litigation costs effectively. The court had to consider whether the plaintiff's conduct warranted costs on an indemnity basis, given the frivolous nature of the claims and the unnecessary prolongation of the proceedings. Additionally, the court needed to decide if the plaintiff and its director's actions constituted misconduct under the Colgate categories, justifying the award of indemnity costs against them. Furthermore, the court examined whether a non-party should also be held liable for costs due to their involvement in the litigation.

In its reasoning, the court found that the plaintiff's claims of fraudulent misrepresentation were baseless and irrelevant, contributing to an overall cavalier approach to the litigation. The court concluded that the proceedings were commenced and continued in disregard of known facts and established law, leading to an unnecessary and wasteful use of court resources. The plaintiff's refusal to accept competent legal advice and their persistence with groundless contentions resulted in significant costs being incurred. The court determined that the plaintiff's conduct fell under the Colgate categories of misconduct, justifying the award of indemnity costs. Accordingly, the court ordered that WOHB Pty Ltd and its director, Mitchell Robert McIlwain, pay the defendants' costs of the proceedings on an indemnity basis, amounting to $182,826.95.

Orders

Orders of the court

1. I order that WOHB Pty Ltd, Mitchell Robert McIlwain and Graeme William McIlwain pay the defendants’ costs of the proceedings on an indemnity basis, fixed at $182,826.95.

Background

Background to the litigation

With respect, the fraudulent misrepresentation allegations were but one part of an entirely cavalier approach by the plaintiff to this litigation, which resulted in a failure to properly investigate the factual matrix which underpinned the allegation, and a failure to appreciate the relevant basis on which to plead such an allegation. Accordingly, I conclude, without hesitation, that the fraudulent misrepresentation claim was, in fact, baseless or irrelevant.Proceedings commenced/continued in disregard of known facts or established law These proceedings were, in my view, commenced and continued in circumstances where a clear and objective view of the facts and the relevant and applicable law should have identified from the outset that the proceedings were bound to fail. It is possible that a component of this failure to identify and appreciate that the proceedings were doomed was that the plaintiff received legal advice from the same law firm in the negotiations for the option agreement as well as in the litigation that followed. It is self-evident that either the plaintiff did not receive competent and objective legal advice in respect of the facts and the law, or, in the alternative, that the plaintiff, through its director, failed to accept any such advice, if it was given. This observation of course, applies relevantly in respect of the making of baseless and/or irrelevant allegations of fraud, and also in respect of the plaintiff’s claim for rectification of the option agreement for mistake as to the period for exercise of the option. In fact, as I concluded in the substantive decision, the plaintiff was well aware that the change of the option period from six months to five months was a deliberate change, as discussed in an email between the parties dated 27 February 2018.[11]Misconduct causing loss of time to the court or parties/allegations ought not to have been made/undue prolongation of case by groundless contentions[11]TB 150 and Mitchell McIlwain accepted in cross-examination that the change was deliberate. T1-89:1; and see WOHB Pty Ltd v Williams & Anor [2024] QDC 94, [79]. I accept the submission on behalf of the defendants that the allegations of fraud and claims for rectification for mistake also fall into the second and fourth Colgate categories and further, the pleading that the antecedent 10 February 2018 agreement should be relied upon, despite it being subsumed by the 23 March 2018 option agreement for “clear and inescapable of reasons”,[12] resulted in the undue prolongation of the case by groundless contentions.[12]WOHB Pty Ltd v Williams & Anor [2024] QDC 94, [39]. Similarly, the issues raised in respect of trusteeship of the trust in which the property was held and the issues related to a former trustee remaining recorded on the title of the property, were matters that were either factually incorrect or legally of no consequence and similarly complicated and unnecessarily prolonged the trial.[13][13]WOHB Pty Ltd v Williams & Anor [2024] QDC 94, [52]-[58].Imprudent refusal of offers to compromise

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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