Alafaci v Mangano

Supreme Court of NSW|2009-12-01|Before: Smart AJ, Young J, Ms J

CITATION : Alafaci v Mangano (No 2) [2009] NSWSC 1366

Good Behaviour bonds under s 10 of Crimes (Sentencing Procedure) Act 1999 for civil contempt. DECISION : Defendants to pay Plaintiffs' costs of proceedings on an ordinary basis. (See paragraph 73 for detailed orders.)

CATCHWORDS : Contempt - Penalties - Good Behaviour bonds appropriate - Costs - No usual rule that indemnity costs payable - In circumstances Defendants to pay costs of Plaintiffs on the ordinary basis - Defendants jointly and severally liable for such costs

LEGISLATION CITED : Crimes (Sentencing Procedure) Act 1999

ASIC v Machalik [2004] NSWSC 1259 Bydand Holdings Pty Ltd v Pineland Property Holdings Pty Ltd [2009] NSWSC 959 Jones v Dunkel (1959) 101 CLR 298 McIntyre v Perkes & Anor (1985) 15 NSWLR 417 Rushcutters Bay Smash Repairs Pty Ltd v H McKenna Netmakers Pty Ltd & 3 Ors [2003] NSWSC 670 CASES CITED : Mike Gaffikin Marine Pty Ltd v Princes Street Marina Pty Ltd NSWSC (unreported, Young J, 15 July 1996) Mount Gambier Co-Operative Milling Society Ltd [1925] SASR 185 Ryan v South Sydney Junior Rugby League Club Ltd [1975] 2 NSWLR 660 Thiess Watkins White Construction Ltd v Witan Nominees [1992] 2 Qd R 452 Trade Practices Commission v Nicholas Enterprises Pty Ltd & Others (No 3) (1979) 42 FLR 213 NCR Australia Pty Ltd v Credit Connection Pty Ltd [2005] NSWSC 1118

Mary Alafaci (First Plaintiff) Paul Alafaci (Second Plaintiff) PARTIES : Marco Mangano (First Defendant) Janel Giuliano (Second Defendant) Janice Mangano (Third Defendant) Nicola Tremaine (aka Nicole Tremaine, Nicole Mangano and Nicole Giuliano) (Fourth Defendant)

Ms J Needham SC / W Hunt (Plaintiffs) COUNSEL : D Shoebridge (First Defendant) R Hanrahan (Second, Third & Fourth Defendants)

Breene & Breene (Plaintiffs) SOLICITORS : Streeter Law (First Defendant) Mercuri & Co (Second, Third & Fourth Defendants)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

3196/2008 Mary Alafaci & Anor v Marco Mangano & 3 Ors (No 2) JUDGMENT 1 On 30 October 2009 each of the four defendants was adjudged guilty of civil contempt: "in that for purposes collateral to the proceedings in which they were provided, each defendant participated in furnishing to the Guardianship Tribunal copies of documents produced on subpoena to this Court in proceedings Equity 5491 of 2006 by Michael Grose and Pamaja Pty Limited, knowing that such documents had been obtained under such compulsory court process." 2 The question arises as to what penalty should be imposed on each defendant and what order as to costs should be made. The prior history and my findings are set out in my earlier judgment. 3 By their Amended Summons of 5 August 2008, the plaintiffs sought that each of the defendants be committed to imprisonment, amongst other things. The Summons of 11 June 2008 sought that relief against the first, second and third defendants. It was not until the opening speech of Senior Counsel for the plaintiffs that it was made clear that the plaintiffs no longer sought the imprisonment of the defendants and that the case being propounded was one of civil not criminal contempt. There were strong tactical reasons for the change as the plaintiffs wished to rely on the principles in Jones v Dunkel (1959) 101 CLR 298 as against all defendants. 4 This was an unusual case in that Mary Alafaci, the first plaintiff, from June 2008 to the commencement of the hearing, sought the imprisonment of her daughter Janice and two of her grandchildren, Marco and Janel, and from August 2008 she sought the imprisonment of Nicole, her grandchild. Similarly, the second plaintiff, Paul Alafaci, sought the imprisonment of his sister, his nephew and his two nieces. There had been proceedings in the Guardianship Tribunal in relation to Mrs Alafaci and the use of her assets and monies. Counsel for the plaintiffs said that they wanted to "put a stop to the ongoing litigation between these parties" (T 130), and submitted that the plaintiffs were legitimately entitled to react to the Guardianship proceedings and the extent of the contempt by bringing these contempt proceedings. I did not accept that there was nothing personal in the application to have Janice and her three children dealt with for contempt and that the application was brought to vindicate and assert the authority of the Court and the administration of justice. 5 The use of the documents for a collateral purpose began about 6 May 2008 when Marco Managano made an application for a financial management order in respect of Mary Alafaci, his elderly grandmother. Copies of documents were sent to the Tribunal on 7 May 2008 and a spreadsheet based on their contents was sent to the Tribunal about 12 May 2008. When Marco Mangano found out that he was being taken to Court for contempt for taking the actions mentioned he promptly withdrew his application for a financial management order. His withdrawal request is dated 10 June 2008. This was received by the Tribunal on 11 June 2008. It was not suggested that the documents had been otherwise used or used since that date by any of the defendants. 6 On 20 August 2008 the defendants, without admissions, agreed: "Until further order of the Court, order that the defendants and each of them be restrained from using any documents obtained on subpoena during proceedings number 5491 of 2006 … for any purpose not directly connected with those proceedings including but not limited to Guardianship Tribunal proceedings number C/32576."

There was an earlier order on 29 July 2008 affecting the first, second and third defendants. Marco Antony Mangano 7 In his affidavit of 30 November 2009 Mr Mangano acknowledged that the Court has found his conduct to be wrongful. He unreservedly apologised for his conduct. He explained that his primary concern in the steps he had taken was the financial well-being of his grandmother. He said that he now appreciates that the documents in question should have been brought before the Guardianship Tribunal by way of a Summons issued by that Tribunal. He apologised to the Court and to the plaintiffs for the contempt. He said that he now fully accepts that he had an obligation not to deal with the material in the way that he did. He said that he did so unknowingly and it was not his intention at that time to act in any way unlawfully. He accepted that he acted in haste, and in hindsight, with insufficient thought. He said that he never consciously made a decision to flout the authority of the Court, nor to breach any undertaking implied or otherwise and apologised for his action in this respect. 8 Attached to Mr Mangano's affidavit was the report of 27 November 2009 of Dr L Lubimoff, a psychiatrist and psychotherapist. She has been treating Mr Mangano's wife for more than a year with medication and regular psychotherapy. Dr Lubimoff has elaborated on the condition of Mr Mangano's wife. 9 Dr Lubimoff has seen Mr Mangano for symptoms of severe stress and depression starting from late in 2008. Mr Mangano suffers from a rare bone condition for which he needs specialised treatment and is in chronic pain from frequent fractures that form. He will eventually become wheelchair bound. There is no estimate of when this is likely to occur. Dr Lubimoff details a series of conditions affecting Mr Mangano which in total are serious. 10 She wrote that both Mr Mangano and his wife "are extremely vulnerable to stress and are very likely to become severely depressed if faced with a significant financial outlay. I especially fear that Mr Mangano's wife is likely to become acutely depressed and suicidal." 11 In parts the doctor's report asserts matters that are unproved and in parts it is emotional and adopts the role of an advocate. I have approached the report with caution but have accepted her physical observations, her statements as to the treatment she has administered and her medical assessment. 12 Mr Mangano is employed as a podiatrist by a Government Health Service and also has a small private practice. He and his wife own their home but it is subject to a mortgage to a Bank. They have borrowed on this property to pay for their legal costs. 13 While ignorance of the law is no excuse, I do not think that Mr Mangano intended to defy or lessen the authority of the Court or interfere with the administration of justice. The obligation which he breached is not widely known outside solicitors and those who frequently engage in contested litigation. However, he did act deliberately in making his application to the Guardianship Tribunal and participating in causing the documents to be sent to the Tribunal on 7 May 2008. He pursued his application until he was alerted to the unlawful acts he had committed and that he was to be taken to Court by his grandmother and uncle for contempt of Court. Once Mr Mangano was so alerted he immediately requested to withdraw his application. The Tribunal permitted him to do so. At an early stage (20 July 2008) he consented, without admissions, to the injunction prohibiting use of the documents. 14 While Mr Mangano established that he did not send the documents to the Tribunal on 7 May 2008, the evidence established that he participated in causing the documents to be sent to the Tribunal. He relied on those documents in support of his application. Although Mr Mangano's apology came after I had delivered judgment, it should be accepted. 15 The contempt and penalty proceeding extended over four days; 24 and 28 April 2009, 24 July 2009 and 1 December 2009 (penalty). Delivery of judgment on 30 October 2009 took but a few minutes. His share of any costs order will impose a heavy burden on him. I have had regard to the subjective matters raised on behalf of Mr Mangano. 16 In view of the likely size of the costs burden I do not think that I should accede to the plaintiffs' opening submission that there should be a payment of a fine. In the plaintiffs' submission on penalty it was submitted that the appropriate penalty was a bond pursuant to s 9 of the Crimes (Sentencing Procedure) Act 1999. On delivering judgment on 30 October 2009 I observed that a good behaviour bond under s 9 of the Crimes (Sentencing Procedure) Act is often thought to be a satisfactory penalty and I was contemplating that course. On reflection, that was not a useful suggestion. Section 9 provides that, instead of imposing a sentence of imprisonment, a court may direct the offender to enter into a good behaviour bond for a specified term. Under s 5(1) of that Act, a court must not sentence an offender to imprisonment unless it is satisfied, having considered all possible alternatives, that no penalty other than imprisonment is appropriate. 17 This is a case in which the plaintiffs no longer seek imprisonment and I would not regard a sentence of imprisonment as appropriate. Section 9 is subject to the provisions of Part 8 of the Act. 18 Section 10(1) provides: "(1) Without proceeding to conviction, a court that finds a person guilty of an offence may make any one of the following orders: … (b) an order discharging the person on condition that the person enter into a good behaviour bond for a term not exceeding 2 years"

Section 10(2) provides: "(2) An order referred to in subsection (1) (b) may be made if the court is satisfied: (a) that it is inexpedient to inflict any punishment (other than nominal punishment) on the person, or (b) that it is expedient to release the person on a good behaviour bond."

Section 10(3) provides: "(3) In deciding whether to make an order referred to in subsection (1), the court is to have regard to the following factors: (a) the person's character, antecedents, age, health and mental condition, (b) the trivial nature of the offence, (c) the extenuating circumstances in which the offence was committed, (d) any other matter that the court thinks proper to consider." 19 Sections 94 and 95 deal with good behaviour bonds. Under s 95 a good behaviour bond must contain a condition to the effect that the offender will appear before the court if called on to do so at any time during the term of the bond and a condition to the effect that, during the term of the bond, the person under the bond will be of good behaviour. 20 As to the matters referred to in section 10(3), Mr Mangano appears to have been in steady employment as a podiatrist. That involves visiting people in their homes and rendering personal services. It was not suggested that he had any convictions for criminal offences. He is a 32 year-old married man. He and his wife have their own home. Obviously he has to assist his wife with her not inconsiderable difficulties. His health and mental condition are far from good. I do not regard the offence committed (contempt) as trivial. The offence was committed against the background of bitter family strife. Mr Mangano's zeal outstripped his judgment. He acted hastily without considering sufficiently the consequences of his actions. He was not aware that what he was doing was unlawful. I have had regard to the aggravating factors and the mitigating factors listed in 21A(2) and (3) respectively. Most of the aggravating factors do not apply. However, the offence was committed in company (s 21A(2)(e), that is, in conjunction with his sisters. Some of the mitigating factors apply (s 21A(3)(a), (b), (e), (f), (g) and (h)). Others do not apply. He is most unlikely to re-offend. 21 I have previously declared that Mr Marco Antony Mangano is guilty of contempt of court. The Court is satisfied that it is expedient to release him on a good behaviour bond. Without proceeding to conviction, I discharge him on condition that he enter into a good behaviour bond for 15 months from today.

Janel Maree Giuliano 22 In her affidavit of 1 December 2009 she states that she understands and accepts the Court's verdict that she participated in a breach of her obligation to the Court by sending an email with attachment documents obtained under subpoena in this Court to the Guardianship Tribunal on behalf of her brother. She further states that she genuinely regrets her involvement and apologises for her breach. 23 She stated that she showed Mr Marco Mangano the documents shortly before her mother's FPA hearing. She said that, as Marco was part of the proceedings, she believed this was all right. She did not consult her mother. She said that Marco said there were some documents he had identified showing large sums being paid to her Uncle Paul Alafaci. She sent the documents, at her brother's insistence, to the Tribunal. 24 She resisted the application to have her and her mother imprisoned. She said that she believed that the effects of her participation in Marco's application were to advance a proper audit of her uncle's management of her grandmother's financial affairs which was in her best interests. She stated "I was not aware that my participation could be considered a crime and I certainly had no intention of achieving any illegal outcome." She was just seeking a just outcome for her grandmother. 25 She has been the Manager for some time of her father's building business and has no other work. Her father is 67, is now in hospital after a knee replacement and unsure of his capacity to return to work. 26 She was liable to pay her uncle and her grandmother their costs of $16,000.00 in relation to some prior proceedings in which she was unsuccessful. 27 The affidavit of JM Giuliano has emotional overtones and is neither well reasoned nor well expressed. She feels that she has been treated unfairly. Notwithstanding the plaintiffs' criticisms of her affidavit, I thought that Janel Giuliano's evidence of genuine regret for her behaviour and her apology should be accepted, even though they are proffered after delivery of the judgment of 30 October 2009. 28 Again, in view of the likely size of the costs burden, I do not think that a fine should be imposed. Ms JM Giuliano has given her occupation as a student. It does not appear whether she is receiving any income for managing her father's building business or what the position is in regard to that. With her 67 year-old father in hospital after a knee replacement and there being some doubt about his capacity to return to work, family circumstances are not encouraging or supportive. 29 I turn to s 10(3) of the Crimes (Sentencing Procedure) Act. There is very limited material. Janel Maree Giuliano is a student and relatively young. It was not suggested that she had any previous convictions. There was no direct evidence of her health or of any mental condition. Her affidavit of 1 December 2009 suggested that she was overwrought and weighed down with family problems. I do not regard the offence as trivial. As to extenuating circumstances, while she acted deliberately, she did not understand that what she was doing was unlawful. She did not intend to defy the authority of the Court or interfere with the administration of justice. The involvement of Ms JM Giuliano was relatively limited. While she arranged with Nicole for the latter to obtain the documents, that was primarily to assist her mother in her mother's claim. She showed the documents to Marco Mangano on 6 May 2008. She participated in sending the documents by email to the Tribunal on 7 May 2008. 30 I was asked by the plaintiffs to find that Ms JM Giuliano was unable to accept the authority of the Court. I do not do so. I thought that the plaintiffs were inclined to read too much into her affidavit and not allow sufficiently for her being overwrought and young. A student would naturally be concerned about the sums of money she has been ordered to pay. Once the contempt proceedings were instituted she took no further steps. She consented to injunctions on 29 July 2008, without admissions, and later on 20 August 2008. 31 I have again had regard to the aggravating and mitigating factors listed in s 21A to the extent that they apply. JM Giuliano is most unlikely to re-offend. 32 I have previously declared Janel Maree Giuliano guilty of civil contempt of court. The Court is satisfied that it is expedient to release her on a good behaviour bond. Without proceeding to conviction, I discharge her on condition that she enter into a good behaviour bond for 15 months from today. Janice Mangano 33 In her affidavit of 30 November 2009 Mrs Mangano states: "2. I am genuinely sorry that I unknowingly became involved in this 'contempt of court' by not keeping a stricter control of the documents produced under subpoena by Pamaja Pty Limited in my Family Provision claim. 3. I apologise to the court for not monitoring the use made by my children of these documents more carefully. I later understood that they were going to be put to the Guardianship Tribunal in order to reveal the truth of the situation concerning my mother's spending on my brother. 4. I was not aware at the time but I have been advised now that this was the wrong thing to do and genuinely regret my failure …:" 34 The affidavit reveals the deep split between Mrs Mangano on the one hand and the plaintiffs on the other. She sets out a series of complaints against her brother. The complaints culminate in paragraph 22 when she states: "… it still seems very unfair to me that my brother has taken my mother away and used expensive lawyers to show me up and make me wrong." 35 The plaintiffs submitted that the Court should attach little weight to Mrs Mangano's statement of regret and apology. They contended that the affidavit was principally an attack upon her brother. It is obvious that feelings in the family are very bitter. The case proved against Mrs Mangano was about her participating in furnishing to the Guardianship Tribunal copies of documents produced on subpoena to the Court in proceedings Equity 5491 of 2006, knowing that such documents have been obtained under such compulsory Court process. She admitted to a slightly different contempt from that which was found. 36 The affidavit of Mrs Mangano consists of several parts. She proceeds in part on what she regards as the general justice of her case. This Court is concerned with her breach of an obligation imposed by law which touches upon the integrity of the Court's processes. The Court is not entitled to disregard upholding its own processes and substitute her views as to the general justice of her case. 37 Notwithstanding the plaintiffs' submissions, I accept the statement of regret and apology of Mrs Janice Mangano. She has referred to facts not known to the Court at the time she was adjudged guilty of contempt. She had not told the Court of them. She did not give evidence. Her evidence would not have advanced the cases of her children. She had sought and obtained the support of her two daughters to obtain the documents, but it seems that they had taken their first steps, at least, to use them before she became aware of what they intended doing. When Mrs Mangano says she later understood that the documents were going to be put to the Guardianship Tribunal she does not state when she gained her understanding. The documents appear to have been sent to the Tribunal from 21/26 Admiralty Drive, where she lived, at about 1600 hours on 7 May 2008. 38 I turn to s 10(3) of the Crimes (Sentencing Procedure) Act. There was no suggestion that Mrs Mangano had any previous convictions or that she was other than a person of good character. She said that she did not have a single traffic offence on her record in 45 years. 39 Mrs Mangano is now 62 years of age. Her husband is aged 67 and it is not certain that he will be able to work again. She has stated: "15 My daughters no longer have jobs as before … The monthly after tax income and expenses of the household now includes only my husband and my daughter Nicole. Janel has quit her job and is looking after the business. We are living on the basics at the moment and just surviving until Joe [her husband] is able to get back to work. Nicole has got a job in California and will be going overseas from January 2010." 40 The joint net assets of Mrs Mangano and her husband amount to $1,045,000.00. It is not clear whether this includes the legacy she received from her father's estate less her costs, namely $520,000.00 net. Her costs of these proceedings will be substantial. 41 I do not think that she intended to defy or adversely affect the authority of the Court or the administration of justice. She failed to supervise and control her children in their use of copies of the documents produced to the Court after she sought their help to obtain such copies. She was not aware of the obligation the law imposed upon her and of the strict limitations as to the use of documents obtained on subpoena. Mrs Mangano has reached an age where she would have very limited prospects of employment. The offence cannot be classed as trivial, but I do not regard her measure of responsibility, in the circumstances, as substantial. Ignorance of the law is no excuse, but her obligation would not be widely known amongst member of the community. The costs order to be made against her is likely to result in a substantial liability on her part. 42 I have again had regard to the aggravating and mitigating factors in s 21A of the Act to the extent that they apply. Mrs Janice Mangano is most unlikely to re-offend. I have previously declared her guilty of civil contempt of court. The Court is satisfied that it is expedient to release her on a good behaviour bond. Without proceeding to conviction I discharge her on condition that she enter into a good behaviour bond for 12 months from today. Nicole Mangano (also known as Nicola Tremaine) 43 She gave oral evidence that she provided copies of documents (produced to the Court under subpoena) with respect to her mother's case to her sister Janel. Ms Nicola Tremaine stated (T 15 of 1 December 2009): "… I'm sincerely sorry for everything that's happened. If I knew that this was going to happen, of course, I would never have done anything. I thought I was only helping, not doing something wrong. So I really am sorry." 44 She said that she had no knowledge of the purposes for which the documents (produced to the Court on subpoena) were being used after she gave them to Janel. She admitted to a slightly different contempt from that which was found. The actions which she admitted were part of her participation in the contempt which was found. She did not deny her actions, which were deliberate. I did not think that her answers in cross-examination, "I'm sorry for obtaining the documents. I'm (sorry) for this whole thing. If I knew by me obtaining the documents it was going to cause this problem (what's happening at the moment), I would never have done it", affected the value of her apology. I have accepted her apology and her statement of regret. Ms Tremaine was young and immature. She conveyed to me that she now realised what she had done was wrong and she regretted it and apologised for it. Her apology was not limited to being sorry that the proceedings had been instituted, that she had been found guilty of civil contempt and the Court was proceeding to determine a penalty. She did not intend to flout or subvert the authority of the Court or the administration of justice. 45 Turning to s 10(3) of the Crimes (Sentencing Procedure) Act, I have mentioned that she was young and immature. She was unaware that what she was doing was unlawful. There was no suggestion that she had any previous convictions. She was a young person who was out of her depth. I did not regard the offence as trivial. I take into account that the costs order to be made against her will impose on her a substantial liability. 46 I have again had regard to the aggravating and mitigating factors in s 21A of the Act, to the extent that they apply. I have previously declared her guilty of civil contempt of court. The Court is satisfied that it is expedient to release her on a good behaviour bond. Without proceeding to a conviction I discharge her on condition that she enter into a good behaviour bond for 15 months from today. Costs 47 The plaintiffs have sought an order for indemnity costs against each defendant and that each of the defendants be jointly and severally liable for the whole of the costs of the plaintiffs. 48 It was accepted by all parties that there was no standard rule which applies to orders for costs in contempt proceedings. In McIntyre v Perkes & Anor (1985) 15 NSWLR 417, Samuels JA, at 426 - 427, did not consider that there was some rule of law or of settled practice in the Australian cases which required the court in contempt matters to make a costs order on other than the ordinary basis "unless it be on occasions where no penalty by fine or by any other means is imposed. In those cases it is certainly arguable that from time to time courts have made an order for costs on the solicitor and client basis on the footing that this order, which provides an indemnity or near indemnity to the successful moving party, represents sufficient recognition of the court's disapproval of the contempt established." Samuels JA noted at 427 that orders for costs are essentially exercises of judicial discretion. 49 The plaintiffs submitted that it was open to the Court in proper circumstances to, in effect, indemnify the person bringing the action for contempt by more than the usual party-party order for costs. 50 Mahoney JA agreed with judgment of Samuels JA. 51 Rogers AJA, at 434, accepted that there was no normal rule that where an intentional contempt is proved on an application by a private prosecutor costs should be ordered on a basis calculated substantially to indemnify the prosecutor. Rogers AJA added that the court had a complete discretion. 52 The plaintiffs referred the Court to the judgments in ASIC v Machalik [2004] NSWSC 1259, NCR Australia Pty Ltd v Credit Connection Pty Ltd [2005] NSWSC 1118 and Bydand Holdings Pty Ltd v Pineland Property Holdings Pty Ltd of 11 September 2009, unreported BC 200908599, [2009] NSWSC 959 at [15] - [17]. 53 The plaintiffs in accepting there was no rule on which they could rely to entitle them to indemnity costs, contended the circumstances were such that an order for indemnity costs should be made. They relied on:

a) taking proceedings on the basis of the contempt which was a breach of the obligation of each defendant (sometimes called an "implied undertaking"); and b) them not seeking any personal gain.

I did not find a breach of any express undertaking. 54 Mr Marco Mangano submitted:

a) the nature of the proceedings were substantively changed by a change on the first day of hearing that removed the call for imprisonment and changed the contempt from "criminal "to "civil" contempt; b) the objective seriousness of the proceedings altered substantially with this change; c) the cost to the parties of the proceedings should be proportional to the importance and complexity of the subject matter in dispute; d) given the principle of proportionality and the objective seriousness of the contempt ultimately found (being an unwitting contempt that Mr M Mangano sought to cure on it being brought to his attention) the Court should limit the costs awarded to the successful plaintiffs; and e) any costs awarded should be on an ordinary basis. 55 I have to bear in mind that:

a) The plaintiffs from June 2008 (as to Marco, Janel and Janice) and from August 2008 (as to Nicole) sought the imprisonment of the defendants. The change of approach of the plaintiffs was not announced until 24 April 2009. On that day it was made clear that the plaintiffs were relying on a "civil" contempt. b) The amended charges were not filed within the time required and it was necessary for the Court to consider extending the time. c) The amended charges were further amended on 28 April 2009, albeit in relatively minor respects. d) The plaintiffs correctly contended that they would have led the same evidence to establish the contempt they alleged irrespective of the remedies sought. However, the remedies sought are an important element in determining the response of each of the defendants. e) On the defendants becoming aware that they had acted unlawfully, and that contempt proceedings were to be taken, there was a request by Mr Marco Mangano to withdraw his application and thus no further use of the documents. Mrs J Mangano and her two daughters did not seek that the proceedings continue. It was unlikely that the Court would impose sentences of imprisonment in such circumstances. There was no suggestion of any assets being lost or endangered or of financial harm being suffered. 56 In all the circumstances, the plaintiffs should be awarded their costs on an ordinary basis and not on an indemnity basis. 57 It was submitted that any costs of the plaintiffs ordered to be paid by the defendants should be a proportion of the ordinary costs of the plaintiffs, that is, not more than 80% of such ordinary costs. I do not agree with that submission. Prudence required all the evidence led by the plaintiffs be adduced to substantiate their case of a civil contempt. The cross-examination of Mr Urquhart called by Mr Marco Mangano substantially advanced the plaintiffs' case. It correctly went well beyond the limited issue on which he had initially been asked to give evidence. 58 Some of the defendants asked the Court to exercise mercy as to the costs orders. The usual principle in contested court proceedings is that the unsuccessful party pays the costs of the successful party, at least to the extent to which the costs have been reasonably incurred in the conduct of the litigation. There are some limited exceptions, but none that apply here. An order for costs is not seen as punitive but as compensatory for the winning party. 59 The more difficult question is whether the costs order made should be a joint and several cost order against each of the defendants or whether the costs should be apportioned between the various defendants. 60 The plaintiffs submitted that the evidence adduced was led against all the defendants and that it was necessary, especially in a case which relied heavily on inferences being drawn, for as many of the facts as possible to be before the Court. 61 The plaintiffs pointed out that, while Marco was separately represented, the same barrister and solicitor represented Mrs J Mangano and her two daughters. That does not mean that joint and several orders should be made. 62 At the hearing the case against Nicole occupied considerable time on the first day and Messrs Liddy and Bryant gave oral evidence. The plaintiffs sought to prove that she had given an express undertaking but I was not satisfied beyond reasonable doubt. The plaintiffs also sought to attribute an express undertaking to her mother and her sister but I was not satisfied of this beyond reasonable doubt. 63 Time was taken on the second day with a well-directed and effective cross-examination of Mr Urquhart. That cross-examination did not waste any time. It assisted when coupled with the Telstra documents and the other evidence in proving the case against Mrs Janice Mangano and her two daughters. Very little time was spent during the hearing in dealing with the case against Mrs Janice Mangano. 64 I dealt with four separate charges of contempt. The evidence against each defendant had to be considered separately. The charges were heard together as a matter of convenience. If I had heard the charge against each defendant separately the hearing time against each would have been much less. The combined hearing increased the costs payable by each defendant. 65 As mentioned, I formed the view that the defendants were acting together. The evidence led as to the circumstances in which Nicole sought and obtained copies of the documents produced on subpoena was admitted against all the defendants. It tended to show that each defendant knew that the documents were obtained under compulsory court process, inter alia. 66 I was initially attracted to the argument that I should apportion the ordinary costs of the plaintiffs payable by each of the defendants based on the evidence led against them, the time devoted to their cases as the hearing and the preparations required in relation to each case. 67 In Trade Practices Commission v Nicholas Enterprises Pty Ltd & Others (No 3) (1979) 42 FLR 213 at 220, Fisher J adopted this statement of principle: "A successful party who has failed on certain issues may well not only be deprived of his own costs of those issues, but ordered in addition to pay his opponent's costs of them, and in this context 'issue' does not mean a precise issue in the technical pleading sense but any disputed question of fact or, in my view, of law." 68 In the present case the issue of an express undertaking did not prolong the hearing to any appreciable extent, either factually or during submissions. 69 At 224 Fisher J stated: "The plaintiff as the successful party is prima facie entitled by way of indemnity to its costs of the action, and if one of the unsuccessful defendants is unable or unwilling to meet its share of the obligation, the misfortune should be that of its 'partner in crime' and not of the plaintiff."

He said that the conventional order that the two defendants pay the plaintiff's costs should stand. The phrase "partner in crime" is used metaphorically. It extends to the defendants. 70 The principle stated by Fisher J was applied by Gzell J in Rushcutters Bay Smash Repairs Pty Ltd v H McKenna Netmakers Pty Ltd & 3 Ors [2003] NSWSC 670. Gzell J also cited Ryan v South Sydney Junior Rugby League Club Ltd [1975] 2 NSWLR 660 at 663 per Bowen CJ in Eq and Mike Gaffikin Marine Pty Ltd v Princes Street Marina Pty Ltd (unreported, Young J, 15 July 1996). See also Mount Gambier Co-Operative Milling Society Ltd [1925] SASR 185 at 198. 71 In Thiess Watkins White Construction Ltd v Witan Nominees (1992) 2 Qd R 452 at 453 Cooper J said: "An order for the payment of costs by two or more persons is joint and several as between them and the payee (Seton, Judgments and Orders, 5 th Ed 1891, Stevens & Sons Vol 1 at 222, Daniels Chancery Practice, (8 th ed., 1914) …"

and "An order for costs against two persons may be enforced against them jointly or against either of them separately …" (citations omitted).

Cooper J concluded at 454: "The general rule that costs against two or more persons are joint and several is not disturbed unless, and only to the extent that, one defendant conducts a separate and distinct defence which incurs costs which cannot be attributed to the joint conduct of the defendants in the defence of the action."

The facts and the conduct of the defendants in the present case are and were not such as to displace the general rule. 72 Pursuant to ss 96 and 99 of the Crimes (Sentencing Procedure) Act 1999 I draw the attention of each defendant to his and her obligations under a good behaviour bond, namely, to appear before the Court if called on to do so at any time during the term of the bond and to be of good behaviour during that term. If a person under a good behaviour bond fails to comply with his or her obligations under such bond, the Court may revoke the bond and may convict and sentence the person under the bond for civil contempt. For example, a fine could be imposed. If the condition as to good behaviour is observed, there is no occasion for action to be taken under the good behaviour bond. 73 I make the following orders:

Pursuant to s 10 of the Crimes (Sentencing Procedure) Act 1999, without proceeding to a conviction: a) Marco Antony Mangano is discharged on condition that he enter into a good behaviour bond for 15 months from today; b) Janel Maree Mangano is discharged on condition that she enter into a good behaviour bond for 15 months from today; c) Janice Mangano is discharged on condition that she enter into a good behaviour bond for 12 months from today; and d) Nicola Tremaine (formerly Nicole Mangano) is discharged on condition that she enter into a good behaviour bond for 15 months from today. Such good behaviour bonds are to be entered into on or before 21 December 2009.

The defendants are ordered to pay the ordinary costs of the plaintiffs of these proceedings on the basis that each defendant is jointly and severally liable.

The plaintiffs' ordinary costs do not include the amendments to the charges and the extension of time granted to file the Amended Charges.

The declarations made and injunctions granted on 30 October 2009 continue.

Correct the judgment of 30 October 2009 by substituting in paragraph 26, line 4, "Janice" for "Janet" and in paragraph 88, line 1, "first" for "firs". **********

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Judgment (28 paragraphs)

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Cases Cited (8)

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