BOTROS v FRANK

Judgment - EX TEMPORE 1These reasons for judgment deal with a dispute with the about the costs of proceedings under s 66 G of the Conveyancing Act 1919 NSW in which orders for the appointment of trustees for sale, and incidental matters, are the subject of agreement. 2I am satisfied that the s 66 G orders agreed between the parties can, and should, be made. 3The plaintiff and the defendant are siblings. They are, more particularly, "half" sister and brother respectively. The property the subject of the proceedings is their former family home, still occupied by their aged parents. 4Their dispute has its origins, at least for present purposes, in the transfer of the parents' one half share in the property (as tenants in common with the plaintiff) to the defendant. 5From the time she became aware of the parents' intention to transfer their interests in the property to the defendant, the plaintiff has complained about being tied to the defendant by way of co-ownership of property. 6She and the older couple had been co-owners of the property for a substantial time until that time. She wanted no part of a change in title. 7The plaintiff foreshadowed, and has acted upon, an intention to make an application for s 66 G relief, if necessary, to free herself of the discomfort she felt, and continues to feel, at the prospect of any co-ownership of property with the defendant. 8The parties have engaged in substantial correspondence, before and after the commencement of these proceedings, about proposals for sale of the property, with or without the benefit of s 66 G orders. 9That correspondence has done nothing to reconcile the parties at any level. 10A summons for s 66 G relief was filed on 18 September 2012. 11The parties' estrangement continued after the commencement of the proceedings. It remains unabating. 12The parties' exchange of affidavit evidence has achieved no more than their correspondence to advance their prospects of reconciliation. 13There are undercurrents of disharmony within the family which can only be guessed at despite the volume of evidence filed in the proceedings. The aged parents, and what may (even now) become of them, are factors apparently never far from the parties' calculations. 14The costs of the proceedings are within the general discretion of the court, presently governed by s 98 of the Civil Procedure Act 2005 NSW. The court's discretion is unconfined, save by the terms of its governing legislation and a requirement that the discretion be exercised judicially. That is to say, not arbitrarily, capriciously or so as to frustrate the legislative intent: Oshlack v Richmond River Council (1998) 193 CLR 72 at 81 [22]; Dunstan v. Rickwood (No 2) [2007] NSWCA 266; [2007] DFC 95-407 at [38]-[39]. 15The parties accept that, as a matter of practice, the "usual order" in s 66 G cases (or at least those cases in which the relief sought is relatively straightforward)is that the costs of the proceedings be paid out of the proceeds of sale of the property the subject of s 66 G orders, assessed on the ordinary basis. 16The plaintiff contends, and I do not understand the defendant to dispute, that, notwithstanding any form of "usual order" that might be referred to as a matter of practice, the obligation of the court in each case in which it is called upon to do so is to ensure that it gives full effect to the breadth of the discretion as to costs conferred on the court by CPA s 98. 17I take that as a correct statement of the court's obligation; but it does not undermine the utility of recognition of a "usual order" arising from experience of cases conforming to a common pattern. 18In order to put in context statements about "the usual order" in s 66 G cases, reference might be made to a number of practice books and cases. There is reference to the "usual order" for costs in each of A G Neville and A W Ashe, Equity Proceedings with Precedents (NSW) (Butterworths, Sydney, 1981), paragraph [1,020] on p 72; E Finnane, H N Newtown and C Wood, Equity Practice and Precedents (Law Book Co, Sydney, 2008), paragraph [18.70] on p 267; and P Young, A Cahill and G. Newtown, Annotated Conveyancing and Real Property Legislation NSW (LexisNexis, Australia, 2012), paragraph [31216.60] on p 111. The cases referred to in these practice books include observations of the Court of Appeal in Kardos v Sarbutt (No 2) [2006] NSWCA 206 at [28]-[29]; Goldberg v. Goldberg [2000] NSWSC 399 at [9]; Hummelstad v Hicks [2006] NSWSC 120; (2006) NSW Conv Rep 56-150 at [54]; and Spathis v Nanos (No 2) [2008] NSWSC 470. 19It is not necessary, in these proceedings, to attempt to articulate in terms of a general principle any particular principle underlying the "usual order". The very characterisation of such an order as "usual" requires an understanding that the making of such an order is not a foregone conclusion, or to be approached on the basis that such an order must invariably be made, or made unless one party or another proves facts warranting an exceptional course. The "usual order" is nothing more than a rule of practice required, in every case, to yield to a consideration of the facts of the particular case. 20Nevertheless, it might be noted that, in Kardos v Sarbutt (No 2) at [28]-[29], the rationale of the practice of "usually making orders for the payment of costs out of the sale proceeds" was said to be that "the costs of such an application are an incident of joint ownership". 21Substantially the same point can be made, also, by reference to paragraph [1020] in Neville and Ashe: "The usual order in respect of costs [in s 66G proceedings] is that the costs of both parties of approaching the Court for the purpose of having trustees for sale appointed be paid out of the proceeds of sale. They are costs which are partly caused by the fact that the property is in joint ownership. It is not necessarily the fault of either party if they cannot agree as to the terms of sale or generally as to the sale of jointly owned property and either party has a right, given by s 66G, to approach the Court to have trustees appointed for that purpose. However, the costs payable out of the proceeds of sale are party and party costs." 22The reference here to "party and party costs" should, in the context of the Civil Procedure Act 2005 and the Uniform Civil Procedure Rules 2005 NSW, be taken as a reference to costs assessed on "the ordinary basis". 23The plaintiff contends that a departure from the usual order is appropriate because, in substance, she says, the defendant has acted unreasonably in not agreeing, earlier than he did agree, to a sale of the property, and in withholding, for too long after the commencement of proceedings, his consent to s 66G orders. 24If it is necessary to formulate the circumstances in which a "departure" from "the usual order" might be warranted, unreasonableness in the conduct of one party or another might provide a criterion worthy of consideration. However, if one approaches the question of costs by reference primarily to Civil Procedure Act, s 98, any necessity for formulation of such a criterion may melt into the background. Broader considerations of the type discussed in Kardos v Sarbutt (No 2) and Neville and Ashe remain. 25I am not satisfied that any costs order other than the usual order should be made in these proceedings. The parties' disputation arises, inherently, from the fact of their co-ownership of property and difficulties associated with effecting a separation of their interests. Neither party can claim immunity from a charge of unreasonableness. 26There is no utility in attempting, here, to weigh in the balance the various offers and counter-offers made by the parties in their journey to consent orders, or their competing positions in the conduct of these proceedings, in order to characterise one or the other as unreasonable. 27To delve too deeply into competing allegations of unreasonableness would be to require a focus, not only on the chronology of events, and questions of legal entitlement, leading up to today, but also on matters of great contention in terms of the personal relationships of members of the family. 28It is in the interests of the parties, as co-owners of the subject property, let alone as members of the same family, to focus attention on what has to be done to sever, by a sale of the property, the obligations of co-ownership that presently tie them together. 29Applying to the facts of this case the general discretion for which the Civil Procedure Act, s 98, provides, I am affirmatively satisfied that the appropriate order, in the interests of justice, is that the costs of these proceedings be paid out of the proceeds of sale of the property, on the ordinary basis and without any provision for a different form of order in favour, or against, either side of the record. 30That conclusion involves a non-acceptance of contentions advanced, on either side of the record, that the other side pay or bear costs on a different basis. 31I propose to make the s 66G orders as sought, coupled with an order in the terms I have identified. 32In formal terms, I make orders in terms of paragraphs 1 to 6 and 8 of Short Minutes of Order dated today, which I will initial and place with the papers. I reserve liberty to apply in the terms set out in paragraph 7 of that document. Paragraph 8 is the costs order. It reads: "Order that the costs of these proceedings be paid out of the sale proceeds of the property as agreed, or assessed, on the ordinary basis." 33I also make the usual order for the return of exhibits; that is, an order that exhibits and subpoenaed material may be returned forthwith; any exhibits returned must be retained intact by the party or person who produced the material until the expiry of the time to file an appeal, or until any appeal has been determined. I will endorse on the Short Minutes to be placed with the papers a notation that the usual order for the return of exhibits has been made.