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[2025] NSWCA 263
respondent. The application for leave to appeal was dismissed with costs.
Atanaskovic sought leave to challenge a stay that prevented enforcement of judgments for unpaid legal fees while costs issues between the parties remained unresolved. The Court of Appeal read the primary judge's reasons in context and concluded that, despite references to costs orders, he understood the applicant was trying to enforce the principal judgments and meant to stay them. It found no reviewable error in the description of the enforcement conduct or in the lack of an express discussion of stay principles. The Court also said that ongoing interest and the substantial court resources already used weighed against leave. The application was dismissed with costs.
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2,653 words · generated 06/10/2026
Atanaskovic v Birketu Pty Ltd [2025] NSWCA 263 concerned an application for leave to appeal from an interlocutory order staying enforcement of judgments for unpaid legal fees. The underlying dispute was between Atanaskovic Hartnell, a legal practice, and former clients Birketu Pty Ltd and WIN Corporation Pty Ltd. By the time of the leave application, John Atanaskovic was the practice's sole principal; the other former principals named in the proceedings did not participate in the leave application ([4]).
8 cited instruments linked from this judgment.
The fee proceedings began in 2017. In the first principal judgment, delivered on 9 August 2019, the primary judge awarded $928,982 for six invoices, excluding an investigation invoice. Orders entered on 16 September 2019 included a stay pending further order ([5]). In December 2019, Birketu paid $1,175,812.36 into court as security for the unpaid legal costs and interest claim while the wider dispute remained unresolved ([6]).
A second judgment followed in 2020. It awarded a further $14,930.15, reflecting partial success in relation to the investigation invoice. The orders ultimately entered in July 2020 were for $16,142.76 plus interest, and were stayed until further order ([7], [10]).
The parties' costs positions were dealt with separately. In June 2020, the primary judge ordered ordinary-basis costs for the plaintiffs in relation to the six invoices, and indemnity-basis costs for Birketu from the day after the first judgment, which it had largely succeeded in resisting in relation to the investigation invoice ([8]). His Honour said that “all accounts should be brought to finality together” and declined to dissolve the existing stay before costs assessment. He also said the funds in court should not be paid out, unless the parties agreed, until all accounts were finalised ([9]).
The expected prompt resolution did not occur. Both sides sought assessments of the other side's costs and then applied for reviews. Evidence before the Court of Appeal indicated that both reviews were completed in October 2025, with Birketu commencing a District Court appeal about the review panel's determination of Atanaskovic Hartnell's costs on 3 November 2025 ([11]).
On 12 September 2024, Atanaskovic sought payment out of money held in court. During the hearing, the primary judge discussed the potential costs position and the High Court appeal then pending on recovery of employed-solicitor costs. His Honour said that enforcement of the relevant orders would not be appropriate in the circumstances, and gave liberty to apply if execution was attempted ([12]). The High Court dismissed Birketu's appeal on 5 February 2025. On 24 April 2025, Atanaskovic served garnishee orders on Nine Entertainment Co Holdings Ltd, seeking to redirect dividends payable to Birketu and WIN to meet a judgment debt then standing at $495,495.66 ([13]).
Birketu and WIN applied to set aside the garnishee orders and stay the judgments. On 28 April 2025, the primary judge stayed the 2019 and 2020 judgments and set aside the garnishee orders ([15]). His reasons referred to costs orders, the pending costs challenges, the earlier discussion of enforcement, and his view that all accounts between lawyer and former client should be finalised together. He described the conduct as “sharp practice” ([16]).
Atanaskovic sought leave to appeal on three grounds: that the primary judge misunderstood the effect of his orders, wrongly described the applicant's conduct, and failed to take account of stay principles and relevant considerations ([2], [17], [25]). The Court of Appeal dismissed the leave application with costs ([29]).
The Court's central task was not to decide the underlying fee dispute afresh. It considered whether the applicant had shown a sufficient basis to appeal the interlocutory stay. Mitchelmore JA noted that the applicant did not contend that the proposed appeal raised an issue of principle. Instead, he relied on an asserted “reasonably clear injustice going beyond what was merely arguable”, referring to PPK Willoughby Pty Ltd v Baird [2019] NSWCA 48 at [6] ([3]).
Ground 1 depended on reading the primary judge's references to costs as evidence that he had misunderstood the orders Atanaskovic was trying to enforce. The applicant argued that the garnishee orders were directed to principal judgment debts, not costs orders. Since the primary judge spoke of staying costs orders, the applicant said he must have mistakenly stayed the principal judgments ([18]-[19]).
The Court rejected that reading. It relied on the transcript, which showed that the primary judge accepted the costs orders were already stayed because the costs assessments were under challenge ([20]). The Court considered it inconsistent to infer that the judge misunderstood his task as merely staying those same costs orders. It also read the reasons as a whole, rather than treating isolated references to costs as decisive ([21]).
In particular, the primary judge had recognised that the applicant sought enforcement of the “full claim” ([22], quoting the primary judge at [6]). His earlier statement about no enforcement until “finality on the amounts payable each way” was not confined to costs. The Court considered that the amounts payable each way necessarily included the sums payable under the principal judgments for the invoices on which the applicant had succeeded. The judge's concern about bringing “all accounts” to finality was therefore understood to encompass the judgment debts as well as costs ([22]-[23]). The Court concluded that there was no demonstrated misunderstanding about either what was being enforced or what was being stayed ([23]).
Ground 2 was contingent on ground 1. At the hearing, the applicant accepted that the “sharp practice” finding flowed from the alleged misunderstanding. Once the Court rejected that underlying premise, it found no reviewable error in the primary judge's factual characterisation. The comment reflected his view of enforcement in the face of his earlier statements about finalising all accounts between the parties ([24]).
Ground 3 alleged that the primary judge did not address relevant stay principles, possible prejudice, the balance of convenience, the judgment creditor's interest in the fruits of judgment, or the time taken by the costs processes ([25]). The Court found no merit in that ground. The primary judge had managed the dispute for years, knew the circumstances and relevant principles, and had not been asked to determine a developed argument on those principles. In that setting, requiring him to recite them would have been “otiose” ([26]). This reasoning is tied to the circumstances before the Court; the judgment does not set out a general rule that stay reasons never need to discuss relevant principles.
Finally, the Court considered the interests of justice independently. It noted that interest continued to accrue on the judgment debts under Civil Procedure Act 2005 (NSW), s 101(1), and Uniform Civil Procedure Rules 2005 (NSW), r 36.7 ([27]). It also emphasised the substantial court resources already used and the parties' ongoing mutual animus ([28]). Applying Mohareb v Local Court of New South Wales [2024] NSWCA 235 at [25]-[31], it concluded that even if error had been shown, the interests of justice would tell against leave ([27]).
This decision did not alter the underlying legal rules governing enforcement, costs assessments, or stays. It resolved a leave application on the record and grounds presented. The judgment does not purport to establish a new general test for granting a stay, and it does not decide the substantive merits of the fee dispute or the eventual net accounting between the parties.
The Court identified the leave threshold advanced by the applicant: reasonably clear injustice going beyond something merely arguable. It referred to PPK Willoughby Pty Ltd v Baird [2019] NSWCA 48 at [6] for that formulation ([3]). The judgment does not reproduce a broader test or describe the full operation of that authority. Its focus is whether the applicant's particular grounds met the threshold in the circumstances.
For the alleged misapprehension, the decision illustrates the importance of assessing reasons in context. The Court said the focus must be on the reasons “read fairly and as a whole” ([21]). It considered the oral exchange, the primary judge's knowledge of the history, and the substance of his concern about finalising all accounts, rather than relying on isolated wording in the ex tempore reasons or later catchwords ([20]-[23]). That approach determined this ground; the Court did not announce that reasons can never be challenged by reference to particular language.
The judgment also addresses a complaint that a judge failed to articulate stay principles. It accepted that an express discussion was unnecessary in this particular setting because the relevant principles and litigation circumstances were well known to the primary judge and were not the subject of submissions or argument ([26]). The ruling is therefore contextual. It does not say that submissions are always necessary, or that reasons for a stay need never disclose the considerations applied.
The Court's interests-of-justice discussion highlights two features of this case, rather than creating a new rule. First, the outstanding judgment debt continued to attract interest under s 101(1) and r 36.7 ([27]). Second, the parties' resources enabled continued disputation, but substantial court resources had already been expended ([28]). These considerations supported refusing leave even on the hypothetical assumption that error had been established.
There was no change to the orders below as a result of the application. The practical position remained that the principal judgments were stayed pending further order, and the garnishee orders had been set aside. The Court of Appeal's order was only that leave to appeal be dismissed with costs ([15], [29]).
At [3], Mitchelmore JA said the applicant relied on “a reasonably clear injustice going beyond what was merely arguable”. In plain English, the applicant needed to show more than a possible point of error: the asserted problem had to reach the level described in that formulation. The judgment applied that threshold to the proposed grounds and concluded that it was not met ([27]).
At [21], the Court said “the focus must be on the reasons, read fairly and as a whole.” In plain English, a court assessing whether a judge misunderstood an issue does not treat one phrase in isolation if the reasons and hearing record provide relevant context. Here, that contextual reading included what the judge had said about amounts payable each way and finalising all accounts ([20]-[23]).
At [22], the Court reasoned that the “amounts payable each way” necessarily included the sums owed under the principal judgments for successful invoice claims. In plain English, the primary judge's concern was not understood as being limited to the parties' costs orders: it also covered the unpaid fee judgments that the applicant sought to enforce.
At [24], the Court said that, absent the alleged misunderstanding, there was “no reviewable error, arguable or otherwise” in the finding about “sharp practice”. In plain English, the applicant's challenge to the criticism depended on showing the judge had misunderstood what enforcement was sought. Once the Court rejected that premise, it did not find a separate appealable error in the characterisation.
At [26], the Court said the primary judge “did not need to go into the principles” because they were known to him and were not argued by the parties. In plain English, the Court treated the judge's familiarity with this long-running litigation and the absence of focused argument as important to whether the reasons needed to set out those principles expressly. It did not make a general statement that judges need not explain decisions.
At [27], the Court noted that interest continued to accrue on the debt and that the interests of justice would tell against leave even if error had been shown. In plain English, the fact that enforcement was delayed did not mean the judgment sum was static, and the Court considered the wider procedural context relevant to whether an appeal should proceed.
The decision is most directly relevant to applications for leave to appeal from interlocutory orders where the applicant alleges that the primary judge misunderstood the practical effect of an order. It illustrates that the alleged error may be assessed against the entire reasons, the transcript, the procedural history and what the judge was actually asked to decide ([20]-[23]).
It is also relevant where a proposed ground challenges an adverse factual characterisation, but that challenge depends on another ground being established. Here, the complaint about “sharp practice” depended on proving the alleged misunderstanding. The Court treated the grounds as linked and rejected the second once the first failed ([17], [24]).
A further potentially relevant pattern is a complaint that a judge failed to discuss principles or factors expressly. The decision's answer depended on the judge's familiarity with the long-running proceedings and the fact those principles had not been made the subject of submissions or argument. Those features should not be detached from the Court's reasoning or treated as a universal answer to omissions in reasons ([25]-[26]).
Finally, the judgment may be relevant to leave applications where there is an arguable error but the applicant must also address the interests of justice. In this case the Court considered continuing interest, the parties' resources and the court resources already consumed ([27]-[28]). The decision does not specify how those considerations would apply in other factual settings.
The judgment is dated 11 December 2025 and contains no discussion of any later judicial treatment of Atanaskovic v Birketu. Its treatment of authorities is limited to the cases it itself cites. It applies Mohareb v Local Court of New South Wales [2024] NSWCA 235 at [25]-[31] in its interests-of-justice analysis ([27]); it cites PPK Willoughby Pty Ltd v Baird [2019] NSWCA 48 at [6] for the reasonably clear injustice formulation ([3]); and it discusses House v The King (1936) 55 CLR 499 in connection with the applicant's asserted error ([19], [21], [25]).
The judgment also refers to Birketu Pty Ltd v Atanaskovic [2025] HCA 2; 99 ALJR 321 as a prior decision in the underlying dispute concerning the recovery of costs of work by employed solicitors ([13]-[14]). That High Court decision is part of the factual and procedural background here, rather than a later treatment of the NSW Court of Appeal's decision.
Accordingly, the supplied judgment supports identifying the authorities considered in this case, but not making claims about how subsequent courts have applied, distinguished or limited this decision.
The decision concerns leave to appeal, not the final accounting between the parties. At the time described in the judgment, costs assessment and review processes remained part of the broader dispute, and Birketu had commenced a District Court appeal about a review panel determination concerning Atanaskovic Hartnell's costs ([11]). The Court of Appeal did not decide the ultimate net amount payable between the parties.
The stay orders were expressed to operate “pending further order of the Court” ([15]). The judgment does not determine when that stay would end or what further order might be made. Nor does it decide what procedural steps or evidence would be relevant to any later application concerning finalisation of the accounts.
The Court rejected the argument that the primary judge misunderstood the orders, but it did not decide a general question about when judgment enforcement should be stayed while costs assessments are pending. Its reasoning was based on the specific history, the primary judge's earlier statements and the parties' submissions ([22]-[26]).
The decision also leaves open how the balance of convenience, prejudice, and the judgment creditor's interest in the fruits of judgment would be assessed on a fully argued stay application in another case. Those matters were raised in the proposed ground, but the Court resolved the complaint by reference to the primary judge's familiarity with the proceedings and the absence of focused submissions ([25]-[26]). It did not provide a comprehensive statement of stay principles.
This is general legal information, not legal advice. Zoe can make mistakes. Before acting on this, relying on it, or using any draft, have it checked by a qualified Australian lawyer.
Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Atanaskovic v Birketu Pty Ltd [2025] NSWCA 263
Hearing dates: 27 November 2025
Date of orders: 11 December 2025
Decision date: 11 December 2025
Before: Mitchelmore JA at [1]
Kirk JA at [30]
Price AJA at [31]
Decision: (1) The application for leave to appeal is dismissed with costs.
Catchwords: APPEALS — leave to appeal from stay of judgment — where quantum of costs under review — whether primary judge misapprehended effect of orders — whether primary judge erred in description of applicant’s conduct — whether express reference to principles governing grant of stay was required
Legislation Cited: Civil Procedure Act 2005 (NSW), s 101(1)
Supreme Court Act 1970 (NSW), s 101(2)(e)
Uniform Civil Procedure Rules 2005 (NSW), r 36.7
Cases Cited: Mohareb v Local Court of New South Wales [2024] NSWCA 235
PPK Willoughby Pty Ltd v Baird [2019] NSWCA 48
Texts Cited: Nil
Category: Principal judgment
Parties: John Ljubomir Atanaskovic (applicant)
Birketu Pty Ltd (ACN 003 831 392) (first respondent)
WIN Corporation Pty Ltd (ACN 000 737 404) (second respondent)
Anthony Geoffrey Hartnell (third respondent)
Jeremy Martin Kriewaldt (fourth respondent)
Michael John Sophocles (fifth respondent)
Jon-Thomas Skene (sixth respondent)
Lawson Andrew Jepps (seventh respondent)
Representation: Counsel:
D Birch (applicant)
B Walker SC and A Vincent (first and second respondents)
Solicitors:
Atanaskovic Hartnell (applicant)
HWL Ebsworth Lawyers (first and second respondents)
File Number(s): 2025/00197791
Publication restriction: Nil
[This headnote is not to be read as part of the judgment]
In judgments handed down in 2019 and 2020, the primary judge ordered the first and second respondents, Birketu Pty Ltd (“Birketu”) and WIN Corporation Pty Ltd (“WIN”), to pay $928,982.00 and $14,930.15 comprising unpaid fees for legal services to the applicant, John Atanaskovic, and others who were then principals of Atanaskovic Hartnell (the applicant is now the sole principal). On 15 May 2020, his Honour ordered that Birketu and WIN pay the applicant’s costs on the ordinary basis until the date of the first judgment, and that the applicant pay Birketu and WIN’s costs on an indemnity basis thereafter.
On 12 September 2024, during the hearing of argument in relation to the payment out of moneys in court, the primary judge stated that it would be inappropriate for any party to enforce judgment until a final accounting could be made. Following a High Court decision in February 2025 relating to the applicant’s costs claim, the applicant sought to enforce the principal judgments by serving garnishee orders on a debtor of Birketu and WIN. Birketu and WIN applied to the Court for orders setting aside the garnishee orders and staying the principal judgments. On 28 April 2025, the primary judge made those orders, stating in his reasons that the epithet “sharp practice” came to mind.
The applicant applied for leave to appeal from the primary judge’s decision on the grounds that his Honour erred in: (1) fundamentally misapprehending the nature of the orders as being limited to staying the costs orders; (2) finding that the applicant’s conduct amounted to “sharp practice” and (3) failing to take into account the principles relevant to the granting of a stay.
The Court (Mitchelmore JA, Kirk JA and Price AJA agreeing) held, refusing leave to appeal:
(1) The applicant failed to establish any reasonably clear injustice going beyond something that is merely arguable. It is apparent from the transcript and the primary judge’s reasons that his Honour understood that the costs orders were stayed by operation of statute, and that he intended to stay the principal judgment. Absent the misunderstanding alleged in ground 1, there was no reviewable error in the primary judge’s finding as to “sharp practice”. The primary judge did not need to go into the principles in circumstances where those principles, and the circumstances of the litigation, were well known to his Honour and were not the subject of submissions or argument.
(2) Even if the applicant had established error, the interests of justice would tell against a grant of leave. Interest continues to accrue on the judgment amount. The manifestation of the parties’ mutual animus should be neither countenanced nor encouraged having regard to the significant court resources that have already been expended.
Mohareb v Local Court of New South Wales [2024] NSWCA 235, applied.
MITCHELMORE JA: The applicant, John Atanaskovic, seeks leave to appeal from the decision of Hammerschlag CJ in Eq (the primary judge) of 28 April 2025, to stay enforcement of two judgments that his Honour gave for the applicant in 2019 and 2020. Leave is required because his Honour’s decision was interlocutory: Supreme Court Act 1970 (NSW), s 101(2)(e).
The application for leave was heard concurrently with the appeal. The applicant contended that the primary judge was under “a fundamental misapprehension as to the effect of the orders which he made” (ground 1), as a result of which his Honour erroneously concluded that the applicant had engaged in “sharp practice” (ground 2). The applicant also contended that in granting the stay, his Honour did not take into account a number of relevant considerations, including “any relevant principles” and their application to the particular proceedings, with which his Honour had been dealing for many years (ground 3).
The applicant did not ultimately contend that the application for leave to appeal raised an issue of principle. He sought leave on the basis that there was a reasonably clear injustice going beyond what was merely arguable: see eg PPK Willoughby Pty Ltd v Baird [2019] NSWCA 48 at [6]. For the reasons outlined briefly below, his Honour’s decision is marked by no injustice, let alone of the relevant kind. The application for leave to appeal must be dismissed.
The applicant is now the sole principal of the law practice known as Atanaskovic Hartnell (AH). The former partners who remained parties to the proceedings below were named as the respondents on the application for leave to appeal but did not participate.
AH provided legal services to the first respondent, Birketu Pty Ltd (Birketu) and the second respondent, WIN Corporation Pty Ltd (WIN). In 2017, AH commenced proceedings against the respondents seeking payment of professional fees and disbursements associated with six invoices and a further invoice that was referred to as the “investigation invoice”. The primary judge gave two principal judgments. In the first, delivered on 9 August 2019, his Honour gave judgment for AH in relation to the six invoices other than the investigation invoice, and ordered the respondents to pay $928,982.00: John Ljubomir Atanaskovic and the persons named in Schedule A trading as Atanaskovic Hartnell v Birketu Pty Ltd [2019] NSWSC 1006. On 16 September 2019, his Honour made orders that included, as orders 1 and 2, the total amount of the judgment debt and, as order 5, a stay of orders 1 and 2 pending further order.
On 6 December 2019, the primary judge ordered the first and second respondents to pay into court, without admission, the amount of $1,175,812.36 as “security for the applicant’s claim for unpaid legal costs and interest” (emphasis added) pending the resolution of the full dispute. The amount ordered to be paid into court comprised the amount of the partial judgment in favour of the plaintiffs, along with the amount of the investigation invoice (which remained in dispute) and other smaller amounts.
In the second judgment, delivered on 15 May 2020, his Honour gave judgment for the plaintiffs for the additional amount of $14,930.15, reflecting partial success in relation to the investigation invoice: John Ljubomir Atanaskovic and the persons named in Schedule A trading as Atanaskovic Hartnell v Birketu Pty Ltd – Supervisory Jurisdiction [2020] NSWSC 573.
On 19 June 2020, his Honour delivered a decision on costs: John Ljubomir Atanaskovic and the persons named in Schedule A trading as Atanaskovic Hartnell v Birketu Pty Ltd – Costs [2020] NSWSC 779. His Honour considered that the principled exercise by the court of its discretion warranted an outcome whereby:
AH should have its costs attributable to the proceedings in relation to the six invoices (excluding the investigation invoice) on the ordinary basis, with those costs being “a matter for assessment”; and
Birketu should have its costs of the proceedings from the day after the first judgment on the indemnity basis, having been largely successful in resisting the claim arising out of the investigation invoice.
“[21] Birketu argued that the amount of any costs payable to it be set off against the verdicts AH has obtained. I do not think that this is a matter of set off. However, I consider that in the present case, which is a dispute between a lawyer and his former client where there has been a found breach of professional duty in respect of which the Court has exercised supervisory jurisdiction, all accounts should be brought to finality together.
[22] There is presently in place a stay, on terms under which Birketu has paid money into court. AH moves that the stay should be dissolved. I do not accept this submission. In my view, the process of assessment should occur first. I would expect the parties to act expeditiously in furthering that process.
[23] A stay of the additional verdict was not addressed by the parties. I will give them leave to apply in case they do not reach agreement about what should happen.
[24] I also do not consider that the monies in Court should be paid out, unless the parties otherwise agree, until there is a finalisation of all accounts between them. The leave to apply which I propose to grant can be utilised in connection with this issue as well.”
On 3 July 2020, the primary judge made an order setting aside the second judgment amount (order 1) and in its place ordered judgment in the amount of $16,142.76 plus interest (order 2). His Honour also stayed order 2 until further order of the Court. These orders were entered on 7 July 2020.
The expedition that the primary judge anticipated in the costs judgment was not forthcoming. After both parties applied for and obtained an assessment of the other side’s costs, both parties applied for review of the respective assessments. Evidence filed on the application for leave to appeal indicates that both reviews were completed in October 2025. On 3 November 2025, Birketu commenced an appeal in the District Court in relation to the review panel’s determination of AH’s costs.
On 12 September 2024, the applicant applied to relist the matter before the primary judge and sought orders for the payment out of funds that Birketu had paid into court. At that time, Birketu had an appeal on foot in the High Court on the issue of whether AH’s employed solicitor costs were recoverable. His Honour endeavoured to divide the funds in a manner consistent with the estimated amount that each party could potentially receive, subject to the High Court’s decision and any further costs assessment, so as to avoid a further application to release the funds following the finalisation of the assessments. His Honour made an order that of the money standing in court, $711,401.81 was forthwith to be paid to Birketu and the balance (approximately $465,000) was forthwith to be paid to AH in partial satisfaction of the judgments. The following exchange then occurred between Mr Hutton SC, who appeared for the applicant, Mr Vincent, who appeared for Birketu, and the primary judge:
“HUTTON: Your Honour, proposed order one in para 1 of our submissions, there were stays in place--
HIS HONOUR: I’ll vacate them.
HUTTON: --on my client enforcing its judgment debts. Yes.
HIS HONOUR: What about that, Mr Vincent?
VINCENT: Yes, that was part of the regime whereby the moneys were paid into Court.
HIS HONOUR: I’ll vacate them.
VINCENT: Yes. Just so my friend, obviously there’s been occasion to set off by virtue of these amounts. Interesting if execution is subsequently sought. Anyway, - yes.
HIS HONOUR: There’s a stay of execution of what?
VINCENT: Of the judgment represented by the moneys paid into Court.
HIS HONOUR: But we all know that these moneys are representative of the possible outcome on costs.
VINCENT: Correct.
HIS HONOUR: And you’ve got an appeal.
VINCENT: Correct.
HIS HONOUR: And so for him to try an[d] execute on those orders now would be not good.
VINCENT: Yes, your Honour.
HIS HONOUR: I’m going to vacate those orders.
VINCENT: Yes.
HIS HONOUR: But I’ll give you liberty to apply if somebody tries to execute you can come straight here.
VINCENT: Court pleases.
HIS HONOUR: I don’t think that’ll happen.”
On 5 February 2025, the High Court dismissed Birketu’s appeal: Birketu Pty Ltd v Atanaskovic [2025] HCA 2; 99 ALJR 321. On 24 April 2025, the applicant served garnishee orders on Nine Entertainment Co Holdings Ltd for the purpose of enforcing the outstanding judgment debt, which stood at that time at $495,495.66. The garnishee orders sought to redirect payment of recently announced shareholder dividends from Birketu and WIN to the applicant.
The respondents exercised the liberty that his Honour had granted on 12 September 2024. They applied for a stay of the judgments pending further order and to set aside the garnishee orders. In a written outline prepared in support of the application, the respondents referred to what his Honour said in the passage of the costs judgment that I have set out above, about the need for “all accounts” between the parties to be “brought to finality together”. Noting that the operation of the costs determinations was automatically stayed pursuant to s 86 of the Legal Profession Uniform Law Application Act 2014 (NSW) because of the review applications, the respondents submitted that there could be no finalisation of all accounts between the parties. Further, if AH were permitted to execute the judgments in its favour before completion of the costs assessment process, that would defeat any such finalisation.
On 28 April 2025, the parties appeared before the primary judge. After hearing briefly from counsel for the present applicant, his Honour made the following orders:
“(1) The judgments in Order 1 and Order 2 of the orders entered by the Court on 16 September 2019 be stayed pending further order of the Court.
(2) The judgment in order 2 of the orders entered by the Court on 7 July 2020 be stayed pending further order of the Court.
(3) The garnishee orders issued by the plaintiffs and directed to Nine Entertainment Co Holdings Ltd and dated 23 April 2025 are set aside.
(4) The plaintiffs are to pay the defendants’ costs of today.
(5) Liberty to apply on seven days’ notice.”
“[1] The defendants seek a stay of the operation of orders for costs made in favour of the plaintiffs.
[2] Neither the plaintiffs’ costs nor the assessment of costs pursuant to an order in the defendants’ favour against the plaintiffs have been finalised. Both sides’ costs assessments are under challenge by the other.
[3] Both sides are well-resourced and sophisticated.
[4] On 12 September 2024, before the decision of the High Court of Australia in Birketu Pty Ltd v Atanaskovic (2025) 99 ALJR 321 had been given (which resolved the issue whether the plaintiffs could recover the costs of work done by their employed solicitors), I made comments (on the transcript) reflecting my view that it would be incorrect for there to be, and there should not be, enforcement by either party of any costs orders until finality on the amounts payable each way had been reached.
[5] On one version and one version only, the presumptive net cost position might ultimately turn out to be in favour of the plaintiffs, but then again, it may not.
[6] In these circumstances and, surprisingly, the plaintiffs saw fit to issue a garnishee order to a debtor of the defendants, seeking to obtain enforcement of their full claim.
[7] I regard this as entirely unacceptable in the context of proceedings between a lawyer and his former client where all accounts between them should be brought to finality together: see Atanaskovic Hartnell v Birketu Pty Ltd – Costs [2020] NSWSC 779 at [21] and [24].
[8] The epithet ‘sharp practice’ comes to mind.
[9] I consider that until such time as all costs orders have been resolved between them, there should be no enforcement of any judgment for costs between them.”
As I noted above, the first two proposed grounds of appeal are interrelated. The first proposed ground contends that the primary judge proceeded on the basis that the stay was limited to costs orders rather than the whole of the judgments, and thus fundamentally misapprehended the effect of the orders his Honour made. The second proposed ground, which contends that the primary judge erred in characterising the applicant’s conduct as “sharp practice”, is contingent upon accepting that his Honour did fundamentally misapprehend what he was doing.
The applicant submitted that the language the primary judge used in the reasons demonstrated that his Honour considered that his orders would be concerned with orders as to costs, pointing to the following parts of the reasons:
“The defendants seek a stay of the operation of orders for costs”: at [1].
“I made comments [that] … there should not be, enforcement by either party of any costs orders until finality on the amounts payable each way had been reached”: at [4].
“I consider that until such time as all costs orders have been resolved between them, there should be no enforcement of any judgment for costs between them”: at [9].
The applicant submitted that in circumstances where it was clear that the judgments which he had sought to enforce by way of the garnishee orders were the principal judgment debts, rather than anything to do with costs, his Honour’s references to costs orders indicated that he was under a misapprehension in staying the principal judgments. The error was further evidenced by the catchwords to the published judgment, which repeated some of the language set out above. His Honour’s error was, the applicant submitted, properly characterised as falling within the principles in House v The King (1936) 55 CLR 499; [1936] HCA 40 and resulted in an injustice going beyond what was merely arguable. As the result was to stay judgment debts that were years old and had at no stage been the subject of an appeal, the applicant submitted that leave should be grated.
My brief summary of the background to this matter indicates that the primary judge had been dealing with these parties for years. His Honour understood that there were ongoing challenges to the assessments associated with the costs orders, which meant that those orders had not been finalised: at [2]. Indeed, it is apparent from the following exchange from the hearing on 28 April 2025 that his Honour was in furious agreement with the applicant’s counsel that the costs orders were already stayed (consistently with the written outline that the respondents provided on the same date, to which I have referred above):
“BIRCH: Can I just explain? What has changed is that my client was successful in the High Court.
HIS HONOUR: I know.
BIRCH: That has changed the net cost position.
HIS HONOUR: But the position is that both assessments are under challenge.
…
HIS HONOUR: The position is that your client owes them 711,000?
BIRCH: Yes. That’s not capable of enforcement either because my client has also commenced an application for review of that.
HIS HONOUR: I agree.
BIRCH: Yes. And so--
HIS HONOUR: We agree.”
(Emphasis added.)
It follows that the effect of the applicant’s argument on proposed ground 1 is that in the face of his Honour’s clear understanding that all of the costs orders were stayed pending review of the costs assessments, his Honour thought, wrongly, that he was staying those same orders. It need only be stated to be rejected. Additionally, however, the reasons support that his Honour well understood what he was being asked to do and why. Although the applicant sought to derive some assistance from the terms in which the catchwords were formulated (necessarily after the event, given his Honour gave his reasons ex tempore), the focus must be on the reasons, read fairly and as a whole.
In [6] of the reasons, his Honour appreciated that what the applicant sought to enforce by way of the garnishee orders was the “full claim”, in circumstances where, as his Honour noted at [4], he had commented at the hearing on 12 September 2024 that there should not be enforcement by either party of any costs orders “until finality on the amounts payable each way had been reached” (emphasis added). The “amounts payable each way” necessarily included the amounts that the respondents were obliged to pay, pursuant to the judgments, on the various invoices for legal fees that the applicant’s firm had successfully sued on. It was against that background that his Honour described the applicant’s conduct, in [7], as “entirely unacceptable in the context of proceedings between a lawyer and his former client where all accounts between them should be brought to finality together” (emphasis added).
Properly understood, and against the background of the long-running litigation with which his Honour was very familiar, the subject matter of which was unpaid invoices for legal fees, his Honour’s references to “costs” did not evidence a misapprehension on his Honour’s part as to which orders the applicant was seeking to enforce and which orders his Honour was intending to stay. Leave to appeal on ground 1 should be refused.
It follows from the outcome on ground 1 that leave to appeal on ground 2 should also be refused. As counsel for the applicant submitted in the course of the hearing in this Court, the finding the subject of ground 2 “flowed from the misunderstanding as to what the applicant was trying to enforce”. Absent any such misunderstanding, there is no reviewable error, arguable or otherwise, in what was a finding of fact. As the respondents submitted, his Honour’s description was a product of the dim view he took of the applicant’s conduct in the face of statements his Honour had made to the effect that no enforcement should occur until all “accounts” had been “finalised”.
The applicant did not substantively address proposed ground 3 orally. In writing, he alleged that the primary judge erred in granting a stay without referring to a series of considerations which the applicant must contend his Honour was bound to take into account in order to establish error. The considerations that the applicant emphasised in writing were the relevant principles that apply when considering an application for a stay, whether the respondents would suffer any prejudice, and whether the balance of convenience favoured the grant of a stay, noting in particular the ordinary entitlement of the applicant as a judgment creditor to the fruits of victory and the time that the costs assessment and review processes had taken.
Leave to appeal should be refused. Costs should follow the event. Accordingly, I propose the following order:
The application for leave to appeal is dismissed with costs.
KIRK JA: I agree with Mitchelmore JA.
PRICE AJA: I agree with Mitchelmore JA.
**********
Atanaskovic
Birketu Pty Ltd [2025] NSWCA 263
(2025) 99 ALJR 321
(1936) 55 CLR 499
The application for leave to appeal was dismissed with costs.
His Honour then said the following:
There is no merit in this proposed ground. As the respondents submitted, the primary judge did not need to go into the principles in circumstances where those principles were well known to his Honour, as were the circumstances of the litigation, and where those principles were not the subject of submissions or argument by the parties. As senior counsel for the respondents submitted, taking the approach for which the applicant contended, in circumstances where the principles are so well known, and their application in the present case so clear as far as his Honour was concerned, would have been otiose.
The applicant has not established any reasonably clear injustice going beyond something that is merely arguable. Even if he had done so, the interests of justice would tell against a grant of leave: see Mohareb v Local Court of New South Wales [2024] NSWCA 235 at [25]-[31]. True it is that the effect of the primary judge’s orders is to keep the applicant from outstanding judgments, given in his favour in 2019 and 2020, in the amount of nearly $500,000. However, as counsel for the applicant frankly accepted during the hearing, interest continues to accrue on the amount of those judgment debts pursuant to s 101(1) of the Civil Procedure Act 2005 (NSW) and r 36.7 of the Uniform Civil Procedure Rules 2005 (NSW).
As the primary judge noted in his reasons at [3], both parties to the application for leave to appeal are well-resourced and sophisticated. That their resources allow them to manifest their mutual animus in ongoing disputation should be neither countenanced nor encouraged, having regard to the significant court resources that have already been expended.