Wood v Crawford [No 2]

[2010] NSWSC 252

CITATION:	Wood v Crawford [No 2] [2010] NSWSC 252
HEARING DATE(S):	3 March 2010
JUDGMENT DATE :	6 April 2010
JURISDICTION:	Equity
JUDGMENT OF:	Slattery J at 1
DECISION:	ORDERS: (a) Direct each party to file and serve agreed orders consequent upon both my judgment of 24 December 2009 and today’s judgment, or in the absence of agreement to serve each party’s proposed orders consequent upon such judgments, by no later than 9 April 2010. (b) Order the defendant to pay 50% of the plaintiff’s costs of these proceedings incurred up to 24 December 2009 and to pay 50% of the plaintiff’s costs of the present argument as to costs in the proceedings. (c) Otherwise reserve questions of the costs incurred after 24 December 2009 in the proceedings. (d) Grant liberty to apply.
CATCHWORDS:	PROCEDURE - costs - plaintiff successful in gaining principal relief sought - general rule costs follow the event - successful party may be deprived of costs due to his own conduct - plaintiff not entitled to all his costs due to plaintiff's own conduct
LEGISLATION CITED:	Civil Procedure Act 2005 s 98 Uniform Civil Procedure Rules 2005 (NSW) rr 42.1, 42.5
CATEGORY:	Consequential orders
CASES CITED:	Jamal v Secretary Department of Health (1988) 14 NSWLR 252 Latoudis v Casey (1990) 170 CLR 534 Milne v Attorney General for Tasmania (1956) 95 CLR 460 Oshlack v Richmond River Council (1998) 193 CLR 72 Ritter v Godfrey [1920] 2 KB 47 Sunday Times Newspaper Co Ltd v McIntosh (1933) 33 SR (NSW) 371 Wood v Crawford [2009] NSWSC 1479
PARTIES:	Plaintiff: Michael Wood Defendant: Eddy Crawford
FILE NUMBER(S):	SC 2522/09
COUNSEL:	Plaintiff: Ms N Obrart Defendant: Mr P Doyle
SOLICITORS:	Plaintiff: Keith Hurst & Associates Defendant: Farry & Co

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

SLATTERY J

TUESDAY 6 APRIL 2010

2522/09 MICHAEL WOOD v EDDY CRAWFORD [No 2]

JUDGMENT

1 HIS HONOUR: The Court gave judgment in these proceedings on 24 December 2009: Wood v Crawford [2009] NSWSC 1479. In that principal judgment I found that Mr Wood was entitled to beneficial ownership of the Dolomite Road property but that before obtaining a transfer of the legal estate in that property to himself Mr Wood must fully reimburse Mr Crawford for all payments that Mr Crawford had made on account of the Dolomite Road property. I directed the parties to prepare short minutes of order to give effect to my reasons for decision. Short minutes have not yet been prepared. The parties cannot agree on an appropriate order for costs. Both sides claim an entitlement to the recovery of their costs. The arguments advanced by Mr Wood and Mr Crawford in respect of costs are set out below after a brief account of the course of argument on that issue.

The Course of Argument on Costs

2 The costs argument in these proceedings took place on 3 March 2010. In anticipation of that hearing Mr Wood provided submissions dated 25 February 2010. Mr Crawford filed submissions on 1 March 2010. Mr Wood filed submissions in reply on 3 March 2010.

3 After full oral argument in relation to costs on 3 March 2010 the proceedings took an unusual course. Mr Wood telephoned my associate on 11 March 2010. My associate recorded the details of his communication in an email she sent to all parties at approximately lunchtime on the day of the communication. A copy of that email was sent to Mr Wood the same day and is set out below.

Dear All

1. Courtesy information - Mr Wood phoned the Associate to Slattery J this morning

I told Mr Wood I could not give legal advice. He was not asking for legal advice.

Mr Wood was concerned that some of his information had not been presented to the Court at the last hearing.

He did not elaborate nor did I ask for details.

I told Mr Wood to phone his solicitors and let them know exactly what he thought had not presented and to ask them why it was not presented.

I told Mr Wood that his solicitors could ring me if they needed to organise a further listing.

2. Please note that if these communications result in either party wanting to put further short submissions before the Court, please let me know as soon as possible.

3. His Honour is in the process of preparing a judgment in relation to costs. It is currently expected that that judgment will be handed down during next week.

Yours faithfully,
Cheryl Scholfield
Associate to Justice Slattery

4 The copy of the email sent to Mr Wood said to him, “I am sorry I am unable to answer your questions. Here is a courtesy copy of the email I sent to both counsel and law firms earlier today.” As a result of my associate’s communications with the parties, the Court gave Mr Wood and Mr Crawford leave to file additional evidence. Both sides took advantage of this grant of leave. Mr Wood filed a supplementary submission on 17 March 2010 together with an affidavit of Keith Stanley Hurst sworn that day. The defendant filed supplementary submissions and an affidavit of Mr Michael Farry of 18 March 2010. Both these affidavits annexed correspondence, which is analysed in the course of this judgment.

Mr Wood’s Submissions as to Costs

5 Mr Wood says that he was successful on prayers for relief 1 and 2 of the amended summons, which prayers for relief sought a declaration that the Dolomite Road property was held on trust for Mr Wood and an order for its transfer to Mr Wood. Mr Wood says that he was successful and the ordinary rule that costs follow the event should apply and he should be awarded costs. He says that the issues at the hearing, as articulated in paragraph [10] of the principal judgment were the substantial issues raised in the amended summons and he was successful on these issues.

6 Next, Mr Wood says that Mr Crawford opposed the declaration of trust, and other relief sought until Mr Crawford made admissions in the witness box that were inconsistent with the continuation of that opposition. Mr Crawford's opposition was maintained through written and oral submissions opposing all Mr Wood’s claims for relief.

7 Mr Wood submits that it was only upon the grant of leave to Mr Crawford to adduce oral evidence on the issue of his conversations with Mr Wood that evidence emerged of the parties’ mutual intention that the Dolomite Road property was always to belong to Mr and Mrs Wood: Wood v Crawford [2009] NSWSC 1479 [14], [32]-[34], [39], [41]-[44], and [48]. The rejected paragraph [5] of Mr Crawford’s principal affidavit contained no hint of the material evidence that emerged in his oral evidence supporting this mutual intention. Mr Wood submits that Mr Crawford’s ultimate oral admission formed a critical part of Mr Wood obtaining relief and that Mr Crawford unreasonably withheld this evidence prior to the hearing. Indeed Mr Wood puts the case more strongly saying that paragraph [5] of Mr Crawford’s affidavit is inconsistent with the admissions Mr Crawford ultimately made in the witness box. Mr Wood says that the true position revealed by the admission should never have been concealed in the way that it apparently was. Where a critical issue in the proceedings is denied from the outset and then without explanation is admitted it would, Mr Wood says, ordinarily ground a successful application for costs to be paid by the admitting party on an indemnity basis: see Uniform Civil Procedure Rules 2005 (UCPR) (NSW) r 42.5.

8 Mr Wood next argues that Mr Crawford’s conduct prior to the proceedings in unilaterally taking steps to put the property on the market without notice to Mr Wood was unreasonable and made the initiation of the proceedings inevitable. Mr Wood’s resistance to forced sale of the property was predictable. The position is made all the worse Mr Wood says because, as the evidence has now emerged, Mr Crawford attempted to sell the property knowing Mr Wood was the beneficial owner.

9 Mr Wood’s case of unreasonable conduct on the part of Mr Crawford goes further. Mr Wood says that Mr Crawford's failure to make appropriate admissions and to conduct the case in a reasonable way is compounded because, even on Mr Crawford's case that Mr Wood was a mere tenant, Mr Crawford never admitted the need to reimburse Mr Wood for the amount by which mortgage payments exceeded the market rent or for the not insignificant improvements made to the property: Wood v Crawford [2009] NSWSC 1479, [46] and [58]. It is said that these admissions would have been proper and reasonable even on the case that Mr Crawford was advancing.

10 It must be said though that the reasonableness or otherwise of Mr Crawford’s position on this issue was never tested in the proceedings. Mr Wood was never found to be a tenant of Mr Crawford. There was never any need to determine whether Mr Wood should be reimbursed over and above his financial commitments to a simple tenancy of the Dolomite Road property.

11 Mr Wood further says that Mr Crawford’s disclaimer of an intention to do anything unconscientious is contrary to the real facts. Mr Wood says that Mr Crawford’s approach, including his unilateral attempt to sell the property prior to the proceedings and his maintaining a stance that Mr Wood’s possession was only a mere tenancy, was contrary to Mr Wood’s actual belief as to Mr Wood’s status and was therefore unreasonable and unconscientious. Mr Wood says Mr Crawford’s actual conduct, rather than his statements in Court should actuate the Court’s costs discretion. Mr Wood says that the Court should disregard self-serving statements by Mr Crawford in the witness box about his motivation.

12 The analysis below reveals that this argument is met by a finding that Mr Crawford’s decision to initiate sale of the Dolomite Road property was not unilateral but was reactive to the financial uncertainty Mr Wood had created for Mr Crawford.

13 Mr Wood also submits that the failure of Mr Crawford to make the necessary admissions that he ultimately made, at a sufficiently early time, caused significant expense to Mr Wood, who had only limited capacity to meet such expenses. Mr Wood claims that he should now be compensated for this by a costs order. The timing of Mr Wood’s admissions is considered below.

14 Finally, Mr Wood also relied upon offers of settlement that he made. These offers are analysed below.

Mr Crawford’s Submissions

15 Mr Crawford’s first submission is that the present dispute arose from Mr Wood’s failure to meet his obligations for the portion of the joint mortgage relating to the Dolomite Road property for which he was responsible. Mr Wood defaulted on his proportion of the mortgage payments in December 2008. This default continued up until the trial on 20 November 2009. Mr Crawford claims that the default continues. Mr Crawford relies upon Mr Wood’s continuing defaults on their arrangements as being the fundamental cause of this litigation.

16 Second, Mr Crawford argues that Mr Wood’s conduct in failing properly to attend to his financial affairs contributed to this litigation. Mr Crawford says that Mr Wood delayed obtaining a grant of probate from the Queensland Supreme Court for the estate of his late father who died in 2007. Mr Wood is the substantial beneficiary of his father’s estate. Probate in the estate was not granted until January 2009. Even at trial in November 2009 Mr Wood had done nothing to raise funds to acquire the Dolomite Road property from Mr Crawford. Mr Crawford submits that it would have been easy for Mr Wood to use this property to repay the loan but he made no attempt to sell it for this purpose.

17 Third, Mr Crawford says that the burden of making the additional mortgage repayments caused Mr Crawford significant financial and emotional stress for a man of some eighty years of age already suffering health problems. Mr Wood’s failure to deal with his mortgage obligations led to an understandable reaction on the part of Mr Crawford to bring matters to a head by attempting to sell the property.

18 Fourth, Mr Crawford says Mr Wood himself, broke off attempts to negotiate a settlement of the matter in 2008. Mr Crawford says this was for understandable reasons because Mr Wood was continuing to reside in the Dolomite Road premises in 2009 rent free knowing he was not making any contribution to the mortgage and putting Mr Crawford in a position where he had no option but to pay Mr Wood’s portion of the mortgage in order to save his own property from being repossessed.

19 Mr Crawford rejects Mr Wood’s reliance upon the Calderbank letters as they do not attempt to resolve all issues facing the parties and cannot for that reason be considered an offer of settlement to which Calderbank principles apply. Mr Crawford submits that the Calderbank letters state that Mr Crawford should transfer the title of the Dolomite Road property to Mr Wood but that he should meet the continuing mortgage obligations himself.

20 In summary Mr Crawford says the issues in this case are wholly occasioned by the conduct of Mr Wood and that the appropriate solution is for the Court to decline to award costs in the proceedings.

Applicable legal principles

21 The legal principles applicable to the exercise of my discretion in this case are not controversial. Subject to the Rules of Court costs are in the discretion of the court and the ordinary principle is that costs generally follow the event: Civil Procedure Act 2005 s 98, UCPR r 42.1 Latoudis v Casey (1990) 170 CLR 534, at 566-7 and Oshlack v Richmond River Council (1998) 193 CLR 72 at 97. A successful party should not be deprived of costs unless there is material to justify a contrary order being made: Milne v Attorney General for Tasmania (1956) 95 CLR 460 at 477. There is a discretion to refuse costs to a successful party, where the Court is satisfied that “some other order should be made”: UCPR r 42.1. Where for example the successful party had encouraged the unsuccessful party to contest the proceedings or otherwise engaged in misconduct in relation to the transaction the subject of the proceedings or in the proceedings, an order refusing costs to a successful party may be justified: Ritter v Godfrey [1920] 2 KB 47; and Sunday Times Newspaper Co Ltd v McIntosh (1933) 33 SR (NSW) 371 at 377 and Jamal v Secretary Department of Health (1988) 14 NSWLR 252 at 271-1 per Mahoney JA.

Decision

22 I conclude in this judgment that a costs order should be made in favour of Mr Wood but I am satisfied that he should not receive all his costs. I conclude this for several reasons.

Some order for costs in Mr Wood's favour is justified

23 Mr Wood has been substantially successful in gaining the relief he claimed. As he submits Mr Wood obtained the relief he sought in prayers for relief one and two in the amended summons. Mr Wood defeated Mr Crawford's contention that Mr Wood was only a tenant of the property and with no equitable interest in it. Prima facie he is entitled to an order for costs for success on this substantial issue in the proceedings.

24 That there should be an order for costs of some kind in Mr Wood's favour is reinforced from consideration of Mr Crawford’s conduct of the proceedings. Mr Crawford admitted that he understood that Mr Wood would ultimately have a beneficial interest in the property. For much of the period of preparation of these proceedings Mr Crawford gave oral evidence that he denied Mr Wood's rights to any such beneficial interest. Yet at the same time he knew that Mr Wood had a justifiable claim. Such conduct right up to the date of trial reinforces the application of the usual principle that costs should follow the event. But the course of events is not this simple.

Mr Wood should not recover all his costs

25 Consideration of Mr Wood's own conduct leads to the conclusion that Mr Wood should not recover all his costs.

26 Mr Wood's conduct was a substantial cause of these proceedings being commenced and maintained. Prior to the filing and service of the amended summons in August of 2009 Mr Wood had been in default under the mortgage since December 2008. This default caused significant financial and personal stress to Mr Crawford who was placed at risk of losing his personal residence at Racecourse Road.

27 Mr Wood also first advanced the unreasonable position through his pleadings that he was entitled to the Dolomite Road property without having to bear any of its outgoings until after the date of the court order. Mr Wood finally articulated through the form of his amended summons filed on 10 July 2009, that he was prepared to meet the liabilities and outgoings on the Dolomite Road property as the price of a declaration that he had a beneficial interest in the Dolomite Road property. Before mid-July 2009, when the summons was amended, Mr Crawford was quite entitled to resist the overstated relief Mr Wood was seeking in the proceedings.

28 But even after mid-July 2009 as the proceedings were progressing towards hearing, Mr Wood’s conduct outside the courtroom seemed quite inconsistent with any genuine commitment to do equity as the price of gaining the relief to which he claimed to be entitled. Mr Wood was enjoying the benefit of occupation of the Dolomite Road property. He was not paying outgoings. Mr Crawford was being forced to pay outgoings at the peril of losing his Racecourse Road property. Mr Crawford was quite entitled to be sceptical of Mr Wood’s promise to do equity as the price of gaining the equitable relief he sought. Whatever his summons might say, he did not demonstrate any practical willingness to contribute to Mr Crawford's ongoing financial commitments for the Dolomite Road property. Despite the findings in my principal judgment, even now as the next section of this judgment explains, Mr Wood has still not given a clear indication how Mr Crawford’s liabilities over Racecourse Road will be paid out.

29 The fact that Mr Wood unfortunately became unemployed in December 2008 is not an answer to this argument. Although he was cash poor in the short term Mr Wood had some financial capacity to meet the Dolomite Road outgoings from the proceeds of the estate of his late father. Mr Wood had at his disposal the means to alleviate the financial problems being faced by Mr Crawford. He made no demonstrable effort to do so. There is no evidence of any supervening difficulty that explains why Mr Wood neither committed the proceeds of his father's estate to reimburse Mr Crawford nor outlined to Mr Crawford a program by which the proceeds of Mr Wood’s father’s estate would be deployed to meet Mr Crawford’s continuing obligations on the Dolomite Road property. The extreme financial uncertainty occasioned to Mr Crawford as a result of Mr Wood’s conduct caused Mr Crawford to take the step of selling the Dolomite Road property, which in turn precipitated Mr Wood’s commencement of these proceedings.

30 Mr Wood sought to reduce the impact of all these matters by emphasising the Calderbank and pre-trial correspondence between the parties.

The Calderbank Correspondence

31 The Calderbank correspondence does not assist Mr Wood. The only Calderbank letter that Mr Wood ultimately relied on was a letter dated 11 August 2009 from the solicitors for the plaintiff to the solicitors for the defendant. The other potential Calderbank correspondence was not pressed.

32 The plaintiff’s solicitors letter of 11 August 2009 offered to settle the proceedings on the basis of (1) the transfer of the title of the Dolomite Road property to Mr Wood, (2) Mr Crawford paying a sum to be agreed between the parties or determined by the Court relating to the Racecourse road property to the mortgagee, (3) Mr Wood taking over the remaining liability for the loan, and (4) Mr Wood reimbursing Mr Crawford for his past expenditure in relation to the Dolomite Road property, and (5) with each party bearing their own costs of the proceedings.

33 The 11 August 2009 letter fails to qualify as an effective Calderbank letter. It does not offer to pay Mr Crawford’s costs. Acceptance of the offer depended on the consent of the mortgagee to Mr Wood taking over the loan. This was unlikely to be achievable given that Mr Wood was unemployed at the time. The amounts to be paid out by Mr Crawford in respect of Racecourse Road and for him to be reimbursed in respect of Dolomite Road were undetermined. Acceptance of this offer was likely to be unachievable. Rather it invited more litigation.

Arguments based on the pre-trial correspondence

34 Mr Wood’s supplementary costs submission contended that prior to the commencement of these proceedings he had been seeking the transfer of the Dolomite Road property into his name and that Mr Crawford had been resisting that course and seeking payment of the purchase price of the property. Mr Wood’s case was that before he defaulted on the mortgage in December 2008, he had offered to have the property transferred into his name and to take over the mortgage payments but he said that Mr Crawford resisted that proposal.

35 In his supplementary submissions Mr Crawford said that the principal problem with these pre-trial negotiations was that assignment of the Dolomite Road property to Mr Wood was only feasible if a suitable price could be agreed and that Mr Crawford could be assured of reimbursement for all the payments he had made on account of the Dolomite Rd property. Mr Crawford says that the correspondence before trial shows that Mr Crawford did not resist the transfer. He contends that the main obstacle to settlement and transfer of the Dolomite Road property was Mr Wood’s financial situation. It is necessary to analyse the pre-trial correspondence to choose between these competing contentions.

36 Analysis of the correspondence between late October 2008 and early February 2009 does not bear out Mr Wood’s contention that he was seeking a transfer of the Dolomite Road property into his name and that Mr Crawford was resisting that course. Mr Wood’s submission gives the impression that the pre-trial correspondence contains a simple request by Mr Wood for the transfer of the Dolomite Road property from Mr Crawford to Mr Wood and a clear and stubborn resistance to this course by Mr Crawford. The correspondence presents quite a different picture. The negotiating positions taken by both parties in the correspondence were too complex for settlement ever to have been likely or for a transfer of the property to be a realistic outcome of the negotiations in the short term. Unresolved obstacles in the pre-trial negotiations included the following matters:

(a) The parties failed to agree upon the existing mortgage liability in respect of the Racecourse Road and Dolomite Road properties.

(b) The parties failed to agree upon the exact price for which the Dolomite Road property should be sold and transferred from Mr Crawford to Mr Wood.

(c) Although Mr Wood asserted he was prepared to purchase the Dolomite Road property and take over the mortgage, he advanced nothing to allow Mr Crawford to conclude that if he accepted the proposals that Mr Wood was realistically capable of carrying them into effect. Even Mr Wood himself was complaining that he, Mr Wood, only had negative equity in the property from which Mr Crawford would have been quite entitled to conclude that Mr Wood would find refinancing difficult.

(d) The settlement offers on both sides were put in unnecessarily complex terms and included other issues distinct from the question of the ownership of the Dolomite Road property, such as issues about taking responsibility of existing credit card debt and the value of the Woods’ motor vehicle.

(e) Neither the present nor any alternative financier of the Dolomite Road liability seems to have been involved in the negotiations in a realistic attempt to gain independent support for resolution of these uncertainties.

37 Mr Wood’s view that that these proposals were being “resisted” in these negotiations is understandable. Mr Crawford was ambivalent about taking any positive steps on the terms Mr Wood was offering. Mr Crawford’s position on this was quite reasonable. By December 2008 Mr Wood had lost his job. No clear financier’s commitment was being provided to fund Mr Wood’s proposals. Mr Crawford was entitled to decline the proposals as unrealistic.

38 The pre-trial correspondence does not assist Mr Wood’s contention that he should be awarded his full costs in these proceedings. But it does not justify the conclusion that Mr Crawford seeks to draw that Mr Wood was the one who broke off attempts to settle the matter. There is no single moment where Mr Wood unjustifiably breaks off negotiations. This is understandable because the issues in play in the negotiations made settlement inherently difficult.

Striking an appropriate balance

39 What then is the appropriate order as to costs? Although from the time of the filing of the Amended Summons on 30 July 2009 Mr Crawford had a pleaded indication that Mr Wood was prepared to take responsibility for the mortgage outgoings in respect of Dolomite Road, well after that date Mr Wood has still failed to make clear how those responsibilities would be met in a way that would release Mr Crawford fully from his obligations to the mortgagee for Dolomite Road. In respect of costs until 30 July I am not prepared to award any costs in favour of Mr Wood.

40 Ultimately though after that date Mr Crawford should have trusted himself to the Court’s processes to resolve this impasse by his admitting Mr Wood’s interest and seeking orders for the sale of Dolomite Road property. He did not do this in sufficient time to avoid the hearing. Thus for a period commencing in about late September or early October I would award costs in favour of Mr Wood. Many of the affidavits in the proceedings were prepared before this time.

41 To facilitate costs assessment it is better to express the allocation of responsibility for costs as a percentage. I will therefore award Mr Wood 50% of his costs from the commencement of these proceedings until the date of the principal judgment on 24 December 2009. I will also award Mr Wood a corresponding 50% of his costs of the argument as to costs.

42 However there have been difficulties in giving effect to my principal judgment. These difficulties are identified in the next section of this judgment. Other costs considerations may well be relevant between 24 December 2009 and the time when my orders are given ultimate effect through either the transfer or sale of the Dolomite Road property. It is conceivable that despite the costs orders made in this judgment that a costs order could be made against Mr Wood in respect of this later period if he does not make satisfactory financial arrangements for the transfer of the Dolomite Road property to him and in turn the property must be sold. It is now useful briefly to examine the conduct of the parties in this later period.

Events Since Judgment on 24 December 2009

43 Mr Michael Farry’s affidavit of 18 March 2010 annexes correspondence passing between the parties from 5 March 2010 to 15 March 2010. This March 2010 correspondence shows a picture of continuing disagreement between the solicitors for the parties about the working through of consequential relief in these proceedings. With a justified sense of urgency Mr Crawford’s supplementary submissions complain of Mr Wood’s continuing default in respect of his share of the mortgage payments since the principal judgment on 24 December 2008. Despite my judgment that the Dolomite Road property should be transferred to Mr Wood before 1 May 2010, Mr Wood has made no information available as to either the proposed sale of the Queensland property or of the Dolomite Road property. Mr Crawford should not be required after the principal judgment to bear the burden of meeting Mr Wood’s mortgage obligations. After a hearing in mid November 2009 I gave judgment before Christmas 2009 so that the parties would know who was responsible for the mortgage payments before they fell due in early January 2010 and thereafter. It is regrettable that Mr Wood is not discharging his responsibility for these obligations.

44 The March 2010 correspondence bears out Mr Crawford’s contentions. In the March 2010 correspondence Mr Wood admits that he has not made the February mortgage payment for Dolomite Road but proposes eventually to make it on completion of the sale of the Queensland property. The correspondence shows disagreement about whether Mr Wood has made the January mortgage payment. Mr Crawford seeks a commitment as to the anticipated date for transfer of the Dolomite Road property to Mr Wood. The correspondence does not contain any clear answer on behalf of Mr Wood as to the anticipated transfer date other than by proffering the statement “when settlement has been scheduled we will contact you so that you may arrange the discharge and advise us how you want the remaining cheque drawn”. Nothing in this correspondence indicates to Mr Crawford how or when Mr Wood proposes to effect settlement of the Dolomite Road transfer. Mr Crawford’s concerns about the developing situation and the mortgagee’s threats to take possession of his Racecourse Road property are understandable. Mr Wood’s final position on these matters is expressed in the last paragraph of his solicitor’s letter of 11 March 2010:

“As our client is not in a financial position to make payments until the Queensland property is sold may we suggest either of the following options:

1. Your client pay the arrears, or


2. Your client informs Resi that the default will be remedied with one month and request that they hold action until then.
As to relisting the matter before His Honour this is a matter for your client although we believe that this cause of action is unnecessary and will only have the effect of increasing the already considerable amount of legal costs incurred.”

45 Mr Wood’s provision of information to Mr Crawford consequent upon my orders is unsatisfactory. My principal judgment provides that the transfer of the Dolomite Road property should be completed by 1 May 2010. Achieving this timetable now looks remote. If Mr Wood does not rapidly demonstrate a willingness to meet the obligations associated with his beneficial ownership of the Dolomite Road property then Mr Crawford’s position will need to be protected. The Court has granted liberty to apply. That liberty would encompass seeking such consequential relief as Mr Crawford may be advised to seek to vest the Dolomite Road property in trustees for sale. Later this month, as 1 May approaches, the Court will, if necessary, consider any application for sale of the Dolomite Road property through trustees for sale. Any sale proceeds from such sale could be used to satisfy Mr Wood’s outstanding mortgage obligations for the Dolomite Road property.

Conclusion

46 The parties have not yet agreed on short minutes of order consequent upon the principal judgment. This should now be done. The Court’s orders must be settled. The question of costs has now been resolved. I direct and order the following:

a Direct each party to file and serve agreed orders consequent upon both my judgment of 24 December 2009 and today’s judgment, or in the absence of agreement to serve each party’s proposed orders consequent upon such judgments, by no later than 9 April 2010.

b Order the defendant to pay 50% of the plaintiff’s costs of these proceedings incurred up to 24 December 2009 and to pay 50% of the plaintiff’s costs of the present argument as to costs in the proceedings.

c Otherwise reserve questions of the costs incurred after 24 December 2009 in the proceedings.

d Grant liberty to apply.

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