Yesilhat v Calokerinos, Executor of the Estate of the late George Sclavos (No. 2) [2019] NSWSC 584
Calokerinos, Executor of the Estate of the late George Sclavos v Yesilhat
Yesilhat v Calokerinos, Executor of the Estate of the late George Sclavos (No. 3) [2019] NSWSC 1752
Calokerinos, Executor of the Estate of the late George Sclavos v Yesilhat
Source
Original judgment source is linked above.
Catchwords
Yesilhat v Calokerinos, Executor of the Estate of the late George Sclavos (No. 2) [2019] NSWSC 584
Calokerinos, Executor of the Estate of the late George Sclavos v YesilhatYesilhat v Calokerinos, Executor of the Estate of the late George Sclavos (No. 3) [2019] NSWSC 1752
Calokerinos, Executor of the Estate of the late George Sclavos v Yesilhat
Judgment (3 paragraphs)
[1]
EX TEMPORE Judgment
By Motion dated 29 October 2021 ("the Motion"), Cleopatra Sclavos Calokerinos, the executrix of the estate of her late uncle, George Sclavos, and the plaintiff in these proceedings seeks a specified gross sum costs order instead of assessed costs under Civil Procedure Act 2005, s 98(4)(c) in respect of the costs orders made in the estate's favour against Mr Gokan Yesilhat in these proceedings.
This is my fifth judgment in these proceedings, which have been considered by the Court of Appeal since my last judgment. The proceedings are now close to a conclusion, issues of costs being the only remaining issues. This judgment should be read with the Court's previous judgments which are, Calokerinos, Executor of the Estate of the late George Sclavos v Yesilhat, Yesilhat v Calokerinos, Executor of the Estate of the late George Sclavos [2017] NSWSC 666, Calokerinos, Executor of the Estate of the late George Sclavos v Yesilhat; Yesilhat v Calokerinos, Executor of the Estate of the late George Sclavos (No. 2) [2019] NSWSC 584, Calokerinos, Executor of the Estate of the late George Sclavos v Yesilhat; Yesilhat v Calokerinos, Executor of the Estate of the late George Sclavos (No. 3) [2019] NSWSC 1752, and Calokerinos, Executor of the Estate of the late George Sclavos v Yesilhat; Yesilhat v Calokerinos, Executor of the Estate of the late George Sclavos (No. 4) [2020] NSWSC 1044 and on appeal, Yesilhat v Calokerinos [2021] NSWCA 110.
Events, matters and persons will be referred to in this judgment in the same way as in the previous judgments and they should all be read together.
On this application, Ms Castle of counsel appears for the estate instructed by Madison Marcus, and Ms Culkoff appears for Gokan Yesilhat, instructed by Russo and Partners.
The Motion has raised a preliminary issue, which I should determine now. This will enable the parties to get on with preparation for the hearing of the Motion. The preliminary issue is this: whether at the same time that the estate seeks to have a specified gross sum costs order made against Gokan Yesilhat, he should be required to submit to the making of a specified gross sum costs order in respect of any costs ordered in his favour.
The estate is the moving party for a specified gross sum costs order instead of assessed costs. Gokan Yesilhat says that he wants to preserve his right to have costs orders in his favour dealt with by a costs assessor, rather than by way of a specified gross sum costs order under s 98(4)(c). The choice for the Court is whether it should merely consider making a specified gross sum costs order for costs orders in the estate's favour, or whether it should also require Gokan Yesilhat to put forward any claim for costs on costs orders in his favour at the same time so as to avoid any further costs assessment in these proceedings. In other words, should Gokan Yesilhat be compelled against his will now to engage in the s 98(4)(c) process.
Mr Okan Yesilhat was declared bankrupt on 7 June 2021. Australia's Best Tyres Pty Ltd went into liquidation on 29 October 2020.
Because of the stay of proceedings against those parties, the estate has now decided merely to pursue a specified gross sum costs order against Gokan Yesilhat for approximately $22,000 in respect of identifiable sums said to relate to the expenditure of costs solely to the estate's case against Mr Gokan Yesilhat. Compared to the general costs that have been incurred in this case, this is quite a small sum.
Some costs orders have been made in favour of Gokan Yesilhat, the second defendant in the Debt/Trust proceedings. On 11 August 2020, the Court made orders that the plaintiff pay Gokan Yesilhat's costs of the Debt/Trust proceedings, to be assessed on the ordinary basis and on the basis that he shall receive (a) the costs attributable to his defence which are 7.5% of the common costs incurred by all the defendants in the proceedings, together with (b) any specific expenses referable solely to his participation in the proceedings, being for example expenses related to the preparation of his own affidavits.
It is unclear to the Court on the present evidence what amount of costs Gokan Yesilhat claims in respect of those orders. That will no doubt emerge upon an assessment, or upon a s 98(4)(c) application before me. The estate seeks that these costs orders in Gokan Yesilhat's favour be considered under s 98(4)(c) at the same time as the costs orders in the estate's favour. Mr Gokan Yesilhat resists that course. The arguments on both sides may be shortly stated.
Ms Castle, on behalf of the estate, relies on cases such as Harrison v Schipp (2002) 54 NSWLR 738; [2002] NSWCA 213 ("Schipp") at [21] (Giles JA) and Hadid v Lenfest Communications Inc [2000] FCA 628 ("Hadid") (Lehane J), to submit this is an appropriate case for the making of a lump sum costs order.
Ms Castle submits that the long delay that has been occasioned since the commencement of these proceedings, and the complexity of the proceedings, evidenced by the number and length of the Court's previous judgments, are factors which favour the making of a s 98(4)(c) order, particularly in respect of what is ultimately now a fairly small amount of money.
Ms Castle submits that the considerations in favour of that course are made more weighty by the fact that the Court has already found that Okan Yesilhat's claim was based upon a dishonest lie, and have since resulted in his bankruptcy.
Ms Castle submits that it is desirable that these proceedings, which have been running since very shortly after the death of the deceased in August 2013, now be brought to a conclusion.
Ms Castle further submits that, if the matter is to be referred to a cost assessment, that it will take potentially a further six months to complete the costs assessment process before a costs assessor. That may be followed by the exercise of a right of review, and then an appeal as of right. That is likely to be a lengthy process. She also points out that the application before the Court now is before the trial judge and has the advantage of being informed by the trial judge's knowledge of the proceedings.
These arguments favour making a s 98(4)(c) order in respect of the estate's orders for costs against Gokan Yesilhat.
Ms Culkoff's arguments against a similar order being made for Gokan Yesilhat's costs orders are not ultimately persuasive.
First, Ms Culkoff submits that her client is entitled to a costs assessment. There is no doubt this is correct. But that is not in itself an answer to an application under s 98(4)(c), which operates on the basis that, prior to an assessment, such an application may be made, if the discretionary considerations favour that as the appropriate course. Gokan Yesilhat's entitlement to a costs assessment is essentially a neutral factor on the present application.
Ms Culkoff next argued that it would be better that the matter be dealt with by a costs assessor, who was not influenced by the other claims conducted by the estate against Gokan Yesilhat, and Australia's Best Tyres, Ms Castle says that those other claims were thwarted by the liquidation and bankruptcy.
The answer to this argument is that, to the extent that Ms Castle submits that a s 98(4)(c) order should be made because the original proceedings were based upon Okan Yesilhat's dishonesty, that is not a consideration on which I would rely in order to make a s 98(4)(c) order. The Court's credit findings against Okan Yesilhat are not something that I can take into account in making this decision, or in making a s 98(4)(c) order and I do not and will not.
But I can take into account the length of these proceedings, in which Gokan Yesilhat has been involved from the first. And this factor favours the making of an order requiring Gokan Yesilhat to participate in the s 98(4)(c) process and to submit his claims for consideration at the same time as the estate's claims.
This is in Gokan Yesilhat's best interests. He is involved in a case which has taken seven years to complete. This is a strong factor for an order to be made requiring him to participate in the process.
If he participates fully now in respect of costs orders in his favour, he will have the same advantage that the estate has: that the trial judge who heard the proceedings is prepared to be the judge in his s 98(4)(c) application.
Mr Gokan Yesilhat has not identified any prejudice if the Court deals with his claims for costs under s 98(4)(c), rather than by way of a costs assessment. Ms Culkoff submitted that he was concerned that his costs would be cut down, as the estate's claims for costs against Okan Yesilhat and Australia's Best Tyres were no longer being pursued. The Court has assured him and Ms Castle that they will be entitled to put before this Court, on an s 98(4)(c) application, anything that would have been put before a costs assessor. There can be no prejudice on that ground.
And Gokan Yesilhat gets the same advantage as the estate: of avoiding a six to 12 month contested costs assessment, and enduring the further rights of review. Economy of costs at this stage is in everyone's best interests. If I were not to take this course, and simply were to make s 98(4)(c) orders to deal with the costs orders in the estate's favour against Gokan Yesilat, that would defeat the purpose of any s 98(4)(c) order in the estate's favour. The efficiency dividend of such orders can only be fully captured if s 98(4)(c) orders are made in respect of all costs orders, so all costs assessments are avoided.
As the Court approaches the end of these proceedings, furthering the overriding objective of the conduct of civil proceedings reflected in Civil Procedure Act, ss 56 and 57 is still an imperative. Furthering the overriding objective strongly favours the making of an order under s 98(4)(c), in respect of the estate's costs orders against Gokan Yesilhat, at the same time as his costs orders against the estate.
[2]
Conclusion and Orders
For these reasons, the Court makes the following orders, notations and directions:
1. Note that the plaintiff moves on the Notice of Motion filed 29 October 2021 ("the Estate's Motion").
2. Note that the Court will consider costs orders in Gokan Yesilhat's (the second defendant) favour under Civil Procedure Act 2005, s 98(4)(c) at the same time as costs orders in the plaintiff's (the Estate's) favour.
3. Direct the defendant to file and serve his evidence on the Estate's Motion by 17 December 2021.
4. Direct each party to file any evidence in reply to the other party's evidence on the Estate's Motion by 4pm on 28 January 2022.
5. Direct both parties to exchange written submissions in respect of the Estate's Motion by 4pm on 14 February 2022.
6. Direct both parties to exchange submissions in reply in respect of the Estate's Motion by 4pm on 28 February 2022.
7. Grant liberty to the parties from 1 March 2022 to approach my Associate in Chambers to set the Estate's Motion down for hearing at a date suitable to the Court, providing to my Associate their agreed mutually convenient dates for a hearing of no more than one hour commencing at 9am.
[3]
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Decision last updated: 08 December 2021