Yuksels Nominees Pty Ltd v Nguyen and anor (Ruling No.2)

[2016] VSC 37

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

PRACTICE COURT

S CI 2015 05553

YUKSELS NOMINEES PTY LTD (ACN 006 261 810)	Plaintiff
v
JOANNE THU NGUYEN	First defendant
and
REGISTRAR OF TITLES	Second defendant

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JUDGE:	T. FORREST J
WHERE HELD:	Melbourne
DATES OF WRITTEN SUBMISSIONS	25, 30 November 2015
DATE OF RULING:	11 February 2016
CASE MAY BE CITED AS:	Yuksels Nominees Pty Ltd v Nguyen & anor (Ruling No.2)
MEDIUM NEUTRAL CITATION:	[2016] VSC 37

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COSTS – Application to remove caveat – Caveat removed – Whether or not indemnity costs should be awarded – costs awarded on the standard basis – Love v Kempton [2010] VSC 254.

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WRITTEN SUBMISSIONS PREPARED BY:	Counsel	Solicitors
For the Plaintiff	Mr H. Redd	Landerer & Company
For the Defendants	Mr J. Arthur	Titanium Lawyers Pty Ltd

HIS HONOUR:

1. On 23 November 2015 I ordered that caveat AL473131B, lodged by the first defendant, Joanne Thu Ngyuen, on the title of a property owned by the plaintiff at Sun Crescent, Sunshine (Certificate of Title Volume 11440 folio 621) (‘the Sun Crescent property’) be removed.[1] The relevant background to that dispute is set out in my 23 November 2015 ruling.[2] I do not propose to repeat it in detail. In very brief surmise, the first defendant has an ongoing proceeding in the County Court of Victoria in which she claims damages for alleged breach of an agreement with the plaintiff. She argued, in part, that the existence of that proceeding justified the maintenance of the caveat. It was my view that as Ms Nguyen’s County Court proceeding made no assertion of, or claim for, a proprietary interest in the Sun Crescent property, on the balance of convenience, the caveat ought be removed.

   [1]Yuksels Nominees Pty Ltd v Nguyen & Anor [2015] VSC 663.

   [2]Ibid.

1. By written submission, the plaintiff contends that costs should be awarded on an indemnity basis. It cites the ruling of J Forrest J in Love v Kempton [2010] VSC 254 (‘Kempton’) at [19]:

Before making such an order, the Court needs to be satisfied that the conduct of the party warrants the ordering of costs on an indemnity basis. Special circumstances must be demonstrated “which lift the case out of the ordinary”.[3] Such conduct includes wilful disregard of known facts or clearly established law, as well as the commencement or continuation of such proceedings for an ulterior motive.”

[3]Bass Shire Council v King (unreported 15 August 1994), referred to with approval by Winneke P in Spencer v Dowling [1997] 2 VR 127, 147; as cited in Kempton.

1. The plaintiff claims that it clearly explained to the first defendant “why the caveat should be removed, and foreshadowed that if any application for removal of the caveat proved necessary it would seek costs on an indemnity basis”[4]. It says that the first defendant’s failure to voluntarily remove the caveat in the circumstances gives the appearance of the caveat being intended for use as a ‘bargaining chip’ in the County Court proceeding. This apparent conduct, it argues, lifts this case into the class contemplated by J Forrest J in Kempton.

   [4]Plaintiff’s outline of submissions on costs dated 25 November 2015, [3].

1. The first defendant contends that the submissions made on her behalf at the plaintiff’s application for removal of caveat went beyond arguing as to whether or not the County Court proceeding would be a proceeding to substantiate her claim for to a caveatable interest in the Sun Crescent property. Examples of the these arguments are outlined in the first defendant’s written submissions on costs.[5]  I accept that these submissions were not wholly without merit, and by extension I accept that the first defendant’s case was not entirely hopeless. In my view the first defendant’s case cannot be said to have been “in wilful disregard of known facts or established law”[6].  The plaintiff may have represented to the defendant that it had a strong case, but it is not the duty of a party to second guess the Court when there is scope for real argument on a matter. It is also not incumbent on a Court to award indemnity costs in each instance that they are threatened.

   [5]Outline of submissions on costs on behalf of the first defendant, dated 30 November 2015, at [8].

   [6]See Kempton above.

1. The Court has a broad, unfettered discretion in the awarding of costs pursuant to s 24 of the Supreme Court Act 1986.[7]  I note the comments of J Forrest J in Kempton, and agree that the Court has a role in discouraging proceedings commenced disingenuously.  An order of indemnity costs is, at times, the appropriate vehicle for this. However, in the present case, it is not my view that the first defendant’s conduct leads inexorably to that conclusion.

   [7]Lombardo v Bahnan (No 2) [2014] VSC 438, at [3].

1. In civil proceedings, costs ordinarily follow the event.[8]  I do not find special circumstances in in this case that warrant departure from that rule.  I order that the first defendant pay the plaintiff’s costs of this proceeding, to be taxed at the standard basis, in default of agreement.

   [8]Oshlack v Richmond River Council (1988) 193 CLR 72.