Casey v Giderson

1 This is a costs dispute arising from matters I heard and determined in the Practice Court on 30 June, 4 July (on the papers), and 5 July 2023.

2 On 30 June and 4 July 2023, I heard and determined ex parte applications by the plaintiff in proceeding S PRB 2023 15848 for the grant and subsequent amendment of letters of administration ad litem of the deceased estate of his son (the Related Proceeding). On the application of the plaintiff on each occasion, I ordered that the costs of each of those applications be paid or retained out of the estate.

3 By 30 June 2023, when the Related Proceeding was commenced, the plaintiff's need to obtain letters of administration ad litem was urgent. The plaintiff claimed that the deceased estate held an interest over certain land as chargee pursuant to loan agreements to which the registered proprietors were party as guarantors. The deceased estate had a caveat over the land reflecting this claim. However, on about 31 May 2023, the deceased estate had received a notice from the Registrar of Titles stating that the caveat would lapse on the 'first moment of 6 July 2023' unless certain things occurred before that date.

4 On 5 July 2023, the plaintiff commenced this proceeding by originating motion between parties, and by summons on originating motion he sought the two substantive orders sought in the originating motion. Those were:

(a) at paragraph 2, an injunction directed to the third defendant to delay registering any dealing with the land situated at 12 Marbray Close, Sorrento (the Property) until further order; and

(b) at paragraph 3, an order 'extending the operation of the caveat with dealing no. AQ284421B' (the Caveat) over the Property until further order.

5 The first and second defendants (the Gidersons) appeared at the hearing of the summons on the afternoon of 5 July and resisted the application. The third defendant (the Registrar) did not appear. I declined to make any order purporting to extend the Caveat on the basis that the Court had no such power.[1] I granted an interim injunction for reasons which I set out below. I reserved costs, but indicated that I would receive brief written submissions and make a determination on the papers as to the costs of the summons.

6 On 31 July 2023, the Court received written submissions from counsel for the Gidersons seeking an order that the plaintiff pay their costs of and incidental to this proceeding in the period up to and including the date on which the order is made (the Gidersons' submissions). The Gidersons' submissions annexed a copy of a Register search statement dated 10 July 2023 showing that the Caveat remained registered on that date and had not lapsed on 6 July 2023.

7 Also on 31 July 2023, the Court received unsigned submissions on behalf of the plaintiff from his solicitors (the plaintiff's submissions), and an affidavit in support. As his primary position, the plaintiff seeks an order that the Gidersons pay his costs of and incidental to this proceeding and his application for letters of administration ad litem in the Related Proceeding, on an ordinary basis until 5pm on 28 June 2023, and thereafter on an indemnity basis. In the alternative, the plaintiff submits that, in respect of the issue of extending the operation of the Caveat over the Property, each party should bear its own costs, and otherwise the plaintiff's primary position should apply. The plaintiff submits that whatever course is taken, he should not be liable for any of the Gidersons' costs.

8 The evidence before the Court comprises: the plaintiff's affidavit sworn 5 July 2023 and its exhibits; the affidavit of Joshua William Barry, a solicitor in the employ of the plaintiff's solicitors, sworn 5 July 2023 and its exhibits; the affidavit of Matthew Seamus McCarthy, director of the solicitors for the first and second defendants, sworn 5 July 2023 and its exhibits; and a further affidavit of Mr Barry, sworn 31 July 2023, and its exhibits. The exhibits to the further affidavit are extensively relied upon in the plaintiff's submissions. Those submissions set out a detailed chronology of correspondence from 3:46pm on 29 May 2023 to 3:43pm on 5 July 2023, about 20 minutes before the hearing of the plaintiff's summons commenced. The Gidersons' submissions also set out detailed aspects of the chronology of correspondence between the parties. Later in these reasons, I refer to salient aspects of the chronology.

9 To the extent that the plaintiff seeks his costs of and incidental to the Related Proceeding, the plaintiff's submissions go beyond the scope of the liberty to make submissions on costs I granted to the parties on 5 July 2023, and understandably the Gidersons' submissions do not address that issue. However, I decided to give provisional consideration to the issue, and ultimately for the reasons set out below I have determined it against the plaintiff in any event.

10 In addition to relying on affidavit material filed in this proceeding, the plaintiff's submissions also rely upon affidavit material filed in the Related Proceeding. I decided to give preliminary consideration to the affidavits that were filed in that proceeding, as sought by the plaintiff. As I have ultimately concluded that the plaintiff's submissions on costs should be rejected, there is no prejudice to the Gidersons occasioned by the plaintiff's reliance on those affidavits, and I have taken them into account in determining the costs applications before me.

11 The Court's discretion and power to make orders as to the costs of and incidental to the two proceedings is conferred by s 24 of the Supreme Court Act 1986, and must be exercised subject to and in accordance with Order 63 of the Supreme Court (General Civil Procedure) Rules 2015 (the Rules). The general rule is that in the absence of special circumstances costs follow the event,[2] consistently with the principle that an order for costs indemnifies the successful party in litigation in respect of professional fees necessarily and reasonably incurred in connection with the litigation.[3] The discretion must be exercised judicially, meaning that any departure from the general rule depriving the successful party of their costs, or (even more so) ordering them to pay the other party's costs, must be for a reason connected with the case.[4] Grounds for depriving a successful party of its costs may arise where a less expensive procedure could have been adopted.[5] Further, courts have awarded indemnity costs in respect of applications that were unnecessary, albeit against unsuccessful applicants and not successful ones.[6] I was not taken to any case in which a partially successful applicant was ordered to pay the respondent's costs.

12 Neither side addressed whether the Civil Procedure Act 2010 might have some relevance to the exercise of my discretion as to costs.

13 Part V Division 1 of the Transfer of Land Act 1958 (the Act) is entitled 'Caveats against dealings'. Section 89(1) in that Division provides for the lodging of caveats with the Registrar and their removal. Section 89(2) requires the recording of caveats in any relevant part of the Register. Lodging a caveat is a significant step. Section 118 provides that a person lodging a caveat without reasonable cause 'shall be liable to make to any person who sustains damage thereby such compensation as a court deems just and orders'.

14 On 25 September 2017, the Caveat was lodged with the Registrar by a solicitor on behalf of James Vincent Casey (the Deceased) as caveator. The registered dealing for the Caveat stated that the caveator claims an interest as chargee in the land described in Volume 10199 Folio 292, which is the Property. The Property was and remains registered to the Gidersons as joint proprietors of an estate in fee simple. The grounds of claim specified in the Caveat referred to an agreement dated 29 August 2017 with the registered proprietors.

15 On 24 December 2021, the plaintiff's or Deceased's then solicitors sent a letter to the Gidersons enclosing a further loan agreement, dated 3 May 2018, and containing the following statement:

We remind you that you have secured your obligations under the Loan Agreement against the property at 12 Marbray Close, Sorrento VIC 3943.

16 On 29 May 2023 at 2:36pm, the solicitors for the Gidersons, McCarthy Partners, sent an email to the plaintiff's in-house lawyer demanding that the Caveat be immediately withdrawn as the Gidersons claimed that their signatures on the alleged loan agreement were forged by their son Stephen.

(a) The plaintiff's in-house lawyer requested that McCarthy Partners provide any and all documents relied upon to contend that the Caveat was lodged without proper cause.

(b) McCarthy Partners provided copies of the Gidersons' driver's licences and passports, which McCarthy Partners said disclosed signatures different to what was on the alleged loan agreement.

(c) The plaintiff's in-house lawyer requested that McCarthy Partners provide sufficient evidence of the alleged forgery, and explain with sufficient particularity what action the Gidersons were taking in respect of it.

(d) In response, McCarthy Partners stated:

my clients' son Stephen forged their signatures;

Stephen openly admits to this;

My clients do not intend to take any action against their son.

18 Section 89A(1) of the Act provides that where a recording of a caveat has been made in accordance with s 89(2), any person interested in the land affected by the caveat may apply in an appropriate approved form to the Registrar for the service of a notice pursuant to sub-s (3). Under s 89A(2)(b), the application must be supported by a certificate of a legal practitioner stating an opinion that the caveator does not have the estate or interest claimed by the caveator

19 On 30 May 2023, the Gidersons lodged an application under s 89A(1) of the Act with the Registrar.

20 Section 89A(3) of the Act provides:

(3) Upon receiving any such application and certificate and upon being satisfied that the applicant has an interest in the land in respect of which the application is made, the Registrar shall give notice to the caveator that the caveat will lapse as to the land and the estate or interest therein in respect of which the application is made on a day specified in the notice unless in the meantime either -

(a) the application is abandoned by notice in writing given to the Registrar by or on behalf of the applicant; or

(b) notice in writing is given to the Registrar that proceedings in a court or VCAT to substantiate the claim of the caveator in relation to the land and the estate or interest therein in respect of which the application is made are on foot.

21 By letter dated 31 May 2023, the Registrar gave notice to the caveator's nominated representative that she had received an application for removal of the Caveat under s 89A(1), and the Caveat would lapse on the 'first moment' of 6 July 2023 unless before that date either the s 89A(1) application was abandoned or she was given written notice that satisfied the requirements of s 89A(3) in the approved form.

(a) McCarthy Partners confirmed to the plaintiff's in-house lawyers that the Gidersons had lodged an application under s 89A of the Act in respect of the Caveat.

(b) The plaintiff's in-house lawyer stated:

We will now seek to commence proceedings to substantiate the estate's claim of the caveat in relation to the relevant land and give notice of same to the Registrar. Obviously we will be seeking inter alia declarations and other relief referable to the caveatable interest.

It is disappointing your clients made no real attempt to substantiate their claims of fraud to us to justify a withdrawal of the caveat and have now incurred and caused the estate to incur potentially unnecessary legal costs. We will rely on this and previous correspondence on the question of costs of our foreshadowed application including that our costs be paid by your clients on an indemnity basis.

23 The above email from the plaintiff's in-house lawyer was a significant milestone in the chronology of relevant correspondence.

24 The plaintiff submits that its significance was as follows:

... as at that time the Gidersons were on notice of potential proceedings to be commenced by Casey in respect of the Agreement and they had since that time to compile relevant evidence to prove the Fraud but they refused or otherwise failed to do so. It was not until 20 minutes before the hearing of these proceedings on 5 July 2023 that alleged evidence of the Fraud with respect to the Agreement was provided by the Gidersons, despite being expressly invited to on multiple occasions.

25 I do not accept the gravamen of this submission, and in particular its criticism of the Gidersons' conduct. The in-house lawyer's email of 1 June 2023 is significant in a different way. It is evidence that it was, by this time, clear to the plaintiff's in-house lawyer and to the plaintiff, that there was a controversy between the parties that would have to be resolved by the plaintiff commencing a proceeding enforcing the alleged loan agreements and so proving the deceased estate's interest in the Property. The Act did not require the Gidersons to do anything more than make an application under s 89A(1). It would then fall to the caveator (or anyone claiming through the caveator) to meet the requirements of s 89A(3), or else the Caveat would lapse. The plaintiff's in-house lawyer knew this, and went so far as to state the plaintiff's intention to seek to commence such a proceeding, to give notice to the Registrar, and to foreshadow a related indemnity costs application against the Gidersons.

26 For these reasons, from 1 June 2023 onward, it was not reasonable for the plaintiff to expect that the Gidersons would alter course by relinquishing the benefit of the operation of s 89A(3) resulting from the application they had made. That benefit was to accrue by the natural operation of s 89A absent abandonment by the Gidersons of their application or notification to the Registrar of a proceeding meeting the requirements of s 89A(3)(b). It was clear to the plaintiff's in-house lawyer, and should have been clear to the plaintiff, that they should not pin their hopes on the Gidersons abandoning their s 89A application. It was up to the plaintiff to seek to avoid that statutory outcome by meeting the requirements of s 89A(3)(b) - that is, by commencing a proceeding in which the controversies between the parties could be adjudicated.

27 There is no real explanation of what, if any, preparations the plaintiff was making to seek to represent the deceased estate and advance its claims in relation to the Caveat between 1 June and 27 June 2023. This is a significant issue, and I return to it later in these reasons.

28 At 2:40pm on 27 June 2023, on a 'without prejudice save as to costs' basis, the plaintiff's in-house lawyer sent an email to McCarthy Partners that the plaintiff submits contained an offer meeting the requirements of Calderbank v Calderbank.[7] The email relevantly stated:

As previously advised and leaving to one side any dispute between your clients and the estate of James Casey regarding amounts owing under the loan agreement, the estate of James Casey will be putting on an application in respect of the loan and caveat for the purpose of rendering the s89A application and relevant lapsing notice otiose and of no effect. We are currently engaging solicitors and counsel to obtain a temporary grant of representation over the estate for this purpose. The caveat has been lodged in accordance with the express terms of the loan agreement and years before any allegations of fraud and forged signatures were made by your clients (or sufficiently proven) such that the caveat has been validly lodged and your clients' application is manifestly hopeless and doomed to fail. Any costs incurred by reason of the temporary grant of representation and the s89 (sic) application will become costs we/the estate are entitled to recover against your clients.

29 The email then invited the Gidersons, 'in the interests of saving costs and time', to withdraw 'the caveat', which was presumably intended to be a reference to their s 89A application. The email went on to state:

Whether the estate and your clients are then unable to resolve the loan and caveat dispute between them such that proceedings must be commenced then so be it, but at least the costs of an unnecessary temporary grant of probate and s89A application will be avoided.

30 In light of this statement, the email was obscure as to what material advantage could possibly be gained, or what material disadvantage could be avoided, by accepting the proposal set out in the email. That is because the prospects of litigation being needed to resolve 'the loan and caveat dispute' remained substantially unchanged. The email went on to state:

As we need to take urgent steps now to obtain the temporary grant of representation to put on any application before the date of 6 July 2023 as stated in the lapsing notice, please confirm by no later than 5pm tomorrow that your clients have withdrawn their application.

Should we not hear from you by this date or your clients refuse to withdraw the s89A application, the offer will lapse and no longer be capable of acceptance as we will have no choice but to obtain the temporary grant of representation and make our own application in respect of the loan, caveat and lapsing notice.

31 The email closed by referring to Calderbank v Calderbank[8] and foreshadowing an indemnity costs application.

32 I accept that the letter contained a proposal meeting the minimum requirements of a Calderbank offer, in the sense that it invited a course of action to bring the Gidersons' s 89A application to an end, indicated that the proposal was without prejudice save as to costs, and referred to Calderbank v Calderbank.[9] I must therefore take it into account in exercising the Court's discretion as to costs, in support of the plaintiff's contention that the Gidersons should be ordered to pay the plaintiff's costs of the Related Proceeding and the proceeding (and that this be ordered partially on an indemnity basis), and against the Gidersons' contention that the plaintiff should be ordered to pay the Gidersons' costs of the proceeding. There is no evidence of any response by the Gidersons to the letter, and I will infer that they did not respond to it.

33 I regard the email, and the lack of any response by the Gidersons by 5pm the next day, as neutral on all the costs issues that fall for determination. For the reasons I have explained, it was not unreasonable of the Gidersons to fail to respond to it within the deadline. The email was only nine days prior to the lapsing of the Caveat. It would attract more weight in the exercise of my discretion if it had been sent earlier. By 1 June 2023, well before 27 June 2023, the plaintiff should have known that he would have to commence a proceeding answering the description in s 89A(3)(b) to avoid the lapsing of the Caveat. The plaintiff's delay in the period 1-27 June 2023 is not adequately explained.

34 On 29 June 2023, the plaintiff's in-house lawyer again wrote to McCarthy Partners inviting the Gidersons to withdraw their s 89A application. The in-house lawyer stated:

On any view there is at least a serious question to be tried as to whether the lender has a caveatable interest in the Land and the caveat will need to remain in place while that issue (amongst others) is determined. We see no commercial basis to maintain the s89A application in circumstances where we will seek to have the caveat extended and recover the costs of doing so from your client... Please provide us with your response by 5pm this afternoon, failing which we will proceed to file and commence the required steps to have the caveat extended.

35 By email dated 30 June 2023, McCarthy Partners responded to the following relevant effect:

3. our clients wish to borrow $170,000 to fund some improvements to their property at 12 Marbray Close Sorrento Vic 3943 (Property) as well as to provide a buffer for their living expenses;

4. that loan is approved, subject to the removal of caveat number AQ284421 B (Caveat);

...

7. our clients will not abandon their s.89A application.

As further evidence that our clients did not sign the loan agreement, we attach Stephen Giderson's statutory declaration dated 29 June 2023.

36 The statutory declaration dated 29 June 2023 referred to in the email was not in evidence.

37 As noted in the Introduction to these reasons, on Friday 30 June 2023, the plaintiff commenced the Related Proceeding. The plaintiff sought a grant of letters of administration ad litem for the purpose of representing the deceased estate in two proposed proceedings:

(a) An 'application seeking relief pursuant to s 90(2)' of the Act; and

(b) 'proceeding to enforce two loan agreements and recover the associated debts'.

38 At the time of his death on 29 August 2022, the Deceased was domiciled in New York City, New York, United States of America. During the hearing on 30 June 2023, I asked whether searches had been conducted as to whether any application for letters of administration (or the equivalent) had been made in New York State in respect of the Deceased. I directed the plaintiff to make and report to the Court the outcome of inquiries but indicated that in the meantime I was prepared to make a limited grant of letters of administration ad litem. Counsel for the plaintiff did not press the application for letters of administration ad litem in respect of a proceeding to enforce the alleged loan agreements. I granted letters of administration ad litem to the plaintiff for the purpose of seeking relief under s 90(2) of the Act. It is now uncontroversial that this grant was inutile, because s 90 of the Act was not engaged on the facts and was irrelevant.

39 Early the following week, on 4 July 2023, the plaintiff sought an amendment to his letters of administration to include the purposes of commencing and conducting proceedings to enforce the alleged loan agreements and commencing and conducting an application to the Court for injunctive relief or 'an application to the Court under section 89A' of the Act in relation to the Caveat.

40 At 10:37am on 4 July 2023, the plaintiff's solicitor sent an email to McCarthy Partners, asserting that the plaintiff had obtained a grant of representation ad litem to address the s 89A application and that he was in the process of 'preparing an application to extend the Caveat'. The Gidersons were requested to withdraw their s 89A application. The Gidersons submit that it was not correct that the plaintiff had at this time obtained a grant of representation ad litem to address the s 89A application. I accept this submission. Further, the notion of an application to extend the Caveat was legally erroneous.

41 The plaintiff's solicitor sent a further email to McCarthy Partners at 1:09pm on 4 July 2023 enclosing a copy of the alleged 2017 loan agreement and inviting the Gidersons to withdraw their s 89A application by 5pm that same day.

42 At 2:54pm on 4 July 2023, McCarthy Partners sent an email to the plaintiff's solicitor stating their instructions, inter alia, that the Gidersons had never signed the alleged loan agreement or any other agreement with Deceased, never met the Deceased, that their signatures to the alleged loan agreement were forged by their son Stephen, that Stephen had repaid the relevant loan, and advising that they refused to withdraw their s 89A application.

43 During the course of 4 July 2023, the letters of administration ad litem were amended to include the purpose of commencing, representing and having conduct and carriage of:

(a) proceedings to enforce, inter alia, the alleged loan agreement; and

(b) an application for injunctive relief or an application to the Court under s 89A relating to the Caveat.

44 In support of his costs application, the plaintiff relies on having made the two offers on 4 July 2023 inviting the Gidersons to withdraw their s 89A application mentioned above. The plaintiff relies on the fact that the Gidersons did not accept these offers. By this time, the plaintiff points out, the Gidersons had been invited (and refused) on four separate occasions to withdraw their s 89A application 'so as to avoid unnecessary costs ...'. For the same reasons I have already set out, I do not consider the Gidersons' conduct in response to any of these offers or proposals to have been unreasonable. The main contributor to the urgent flurry of activity that was taking place was the inadequately explained delay of the plaintiff in the period 1-27 June 2023.

45 At 8:01pm on 4 July 2023,14 the plaintiff's solicitors wrote to McCarthy Partners asking if they held instructions to accept service of process.

46 At about 9:32am on 5 July 2023, the plaintiff commenced this proceeding by sending an email to practice.court@supcourt.vic.gov.au seeking urgent injunctive relief. The application was listed for hearing at 4pm later that day. As already mentioned at [5] above, the originating motion and summons on originating motion included at paragraph 3 an order extending the operation of the Caveat.

47 At 10:13am and 10:41am on 5 July 2023, the plaintiff's solicitors again wrote to McCarthy Partners asking if they held instructions to accept service of process and sent court documents and listing details to McCarthy Partners. McCarthy Partners confirmed that they held instructions at 12:58pm on 5 July 2023.

48 At 3:43pm on 5 July 2023, McCarthy Partners sent an email to the plaintiff's solicitors informing them that the Gidersons would be opposing the application and providing a copy of Mr McCarthy's affidavit and its exhibit 'MSM-1'. This included photographs of what appears to be a signed and witnessed statutory declaration of Stephen Giderson dated 5 July 2023, admitting to having forged his parents' signatures on the alleged 2017 loan agreement. In the affidavit, Mr McCarthy referred to his instructions that Stephen had repaid all amounts due under the alleged loan agreement, and produced various screenshots of text messages said to support those instructions. The plaintiff points out that this evidence was provided with less than 20 minutes before the hearing of the summons in this proceeding, and also submits that the 'contention' that the loan had been repaid was then being made for the first time. I do not accept this last submission, because McCarthy Partners' email on 4 July 2023 referred to instructions to this effect.

49 By email at 1:13pm on 5 July 2023 to the plaintiff, the Court raised a question to the following effect:

There is no evidence before the Court that the plaintiff has commenced a proceeding to substantiate the claim of the caveator in relation to the land and the estate or interest therein, within the meaning of s 89A (3) (b) of the [Act], or that a notice in writing that such proceedings are on foot has been given to the Registrar. If that is correct, could the parties please address the Court in the hearing at 4:00pm on whether the Court can grant an order of the kind sought in paragraph 3 of the Summons and whether there are any authorities on this question.

50 The plaintiff's application came on for hearing shortly after 4pm on 5 July 2023. During the course of his submissions, counsel for the Gidersons queried why it was necessary for the plaintiff to commence this proceeding. The gravamen of counsel's submission was that, having obtained the amended grant of letters of administration, what the plaintiff had to do was to commence a proceeding seeking to vindicate the claim referred to in the Caveat and give notice of that proceeding to the Registrar. In that case, the Caveat would remain registered on the title of the Property, operating as a statutory injunction precluding the registration of further dealings, and it would be unnecessary for the plaintiff obtain injunctive relief. This submission was plainly correct.

51 During the hearing, counsel for the plaintiff undertook that the plaintiff would commence a proceeding to substantiate the interest or estate claimed in the Property by 4pm on 7 July 2023. The Gidersons' submissions state that the following occurred during the hearing while the matter was briefly stood down:

At 4.57pm on 5 July 2023, during the hearing of its injunction application, the plaintiff commenced proceeding S ECI 2023 02940 (Further proceeding) against the Gidersons, the Registrar and Stephen seeking relief in relation to the Loan Agreement and a later loan agreement entered into on 3 May 2018. By the Further proceeding, the plaintiff seeks the making of declarations that he is entitled to possession of the Property and an order directing the Gidersons to transfer their interest in the Property to him. ...

52 The above description of the commencement by the plaintiff of proceeding S ECI 2023 02940 has not been disputed by the plaintiff and appears to be uncontroversial. The plaintiff's submissions (at [22]) state that the commencement of the 'substantive proceedings' (that is, proceeding S ECI 2023 02940) 'was a last resort and one that the Gidersons, through their counsel at the hearing ... on 5 July 2023, sought an undertaking that Casey, on behalf of the estate commence'. The plaintiff's submissions go on to state that 'after the substantive hearing of the proceedings on 5 July 2023 and after his Honour had pronounced (sic) that undertaking, substantive proceedings were reluctantly commenced as a last resort to preserve the Caveat'.

53 It is clear that the plaintiff's primary objective was the preservation of the Caveat. As a matter of law, the only means within his power of attaining that end was to commence a proceeding answering the requirements of s 89A(3)(b). The Court had no power to grant an order in the terms of paragraph 3 of the summons, the effect of which would have been to purport to suspend the operation of s 89A. The plaintiff's decision to delay commencing a proceeding to establish the estate's interest in the Property until the end of the hearing on 5 July 2023 was therefore not reasonable. This compounded the delay that had already occurred between 1 and 27 June 2023. Nor was there any rational justification for delaying the commencement of such a proceeding until an undertaking to commence such a proceeding had been extracted from him during the hearing on 5 July 2023, contrary to the implied suggestion to that effect in the plaintiff's submissions. In any event, he had already indicated in his earlier affidavits that he would commence such a proceeding.

54 Why did the Court grant an interim injunction? In effect, it was granted as an indulgence to the plaintiff, in circumstances where the plaintiff himself was the main cause of the circumstances that made it appear necessary.

55 The hearing occurred shortly before the close of business on the day before the Caveat was due to lapse. It appeared most unlikely that the plaintiff would be able to commence a proceeding and lodge a notice with the Registrar in time to meet the requirements of s 89A(3)(b), and so prevent the Caveat from lapsing. The evidence before the Court demonstrated the existence of a factual controversy raising serious issues for trial and a prima facie claim of an interest in the Property. An interim injunction seemed the only way to preserve the utility of that claim, pending commencement and service of a properly constituted proceeding, without the risk of that claim being rendered nugatory in the meantime. The Gidersons' counsel was unable to point to any particular prejudice that would be occasioned by an interim injunction of that nature. I therefore decided to grant an interim injunction on the giving of appropriate undertakings, even though the circumstances in which an interim injunction had become apparently necessary were very largely of the plaintiff's own making. I ordered that the Registrar must delay registration of any dealing with the Property until further order made in this proceeding or in any other proceeding, or the expiry of 28 days from the date of the order, whichever was earlier.

57 First, he contends that he achieved substantially what the proceeding set out to achieve, in the form of successfully obtaining an order delaying the registration of any dealing with the Property for a period of up to 28 days. He contends that costs should follow the event. I reject this submission for two main reasons. Firstly, it is not appropriate to characterise the outcome of the hearing as a successful outcome for the plaintiff in the usual sense. The outcome was in the nature of an indulgence necessitated by the plaintiff's own legally erroneous and belated actions. Secondly, to the extent that the plaintiff can nevertheless be regarded as achieving part of what he set out to achieve, this is an exceptional case in which costs should not be awarded in accordance with the usual rule. A more appropriate option was available to the plaintiff all along - one to which the plaintiff ultimately resorted after the hearing anyway. The proceeding was in this sense entirely unnecessary, and the plaintiff should have appreciated this before commencing it, and before the hearing late in the afternoon of 5 July. The plaintiff's inadequately explained delay in the period from 1-27 June 2023 was a major contributor to the waste and inefficiency entailed by the commencement of the proceeding. For these reasons, far from this being a case where costs should be awarded to the party that achieved a measure of success, this is a case where that party should pay the costs of the defendants. Insofar as the plaintiff relies on his four offers or proposals to the Gidersons inviting them to withdraw their s 89A application, I am not persuaded that the Gidersons acted unreasonably in refusing some of those proposals and ignoring others. I have taken those offers into account in reaching my conclusions. I reject the plaintiff's first proposition.

58 Second, the plaintiff contends that the Gidersons' limited success in the proceeding, in opposing the order to 'extend' the Caveat, should not deprive the plaintiff of his costs. In reaching my conclusion that the plaintiff should be ordered to pay the Gidersons' costs of this unnecessary proceeding, I place weight on the plaintiff erroneously relying on paragraph 3 of his summons, which invited the Court to make an order it had no power to make. The plaintiff delayed commencing any proceeding to prove the estate's claim to an interest in the property until after it was clear that the Court would not grant the order sought in paragraph 3. This shows that the plaintiff's main objective was the preservation of the Caveat, and he was counting on the Court making an order purporting to extend the Caveat as sought in paragraph 3 of the summons. This objective was contrary to law.[10] The erroneous thinking this displays was an element in the plaintiff's overall conduct between 30 June and 5 July 2023, and significantly contributed to the circumstances in which it seemed to the Court that a last-minute interim injunction was needed, late on 5 July 2023. I reject the arguments in support of the second proposition advanced by the plaintiff that seek to downplay the importance of paragraph 3 of the summons. I reject all the plaintiff's submissions in support of the second proposition.

59 Third, the plaintiff makes an alternative submission that costs be apportioned, with the parties bearing their own costs on paragraph 3 of the summons but costs being ordered in favour of the plaintiff (including on an indemnity basis after 5pm on 28 June 2023). As will be evident from the reasons I have given for dismissing the first and second propositions, no proper reason or need for any apportionment arises. I reject the third proposition.

60 Fourth, the plaintiff submits that 'on any view' he should not be liable for any of the Gidersons' costs, or to the extent that the plaintiff is liable for any of the Gidersons' costs, 'any such order should apply only to costs directly connected to their opposition' to the proceeding and that 'regard should be had to the fact that no such opposition was communicated until the afternoon of 5 July 2023 despite being on notice that Casey intended to bring an application'. It should have been clear to the plaintiff that the Gidersons were intent on adhering to their s 89A notice and disputed their signatures on the loan agreement from 1 June 2023. Further, the Gidersons only seek their costs of and incidental to this proceeding, which only commenced on 5 July 2023. The Gidersons and their legal representatives moved swiftly and acted reasonably in responding to the notice of the proceeding they received on the morning of 5 July and appearing at the hearing that afternoon. Any incidental costs will be reasonably proximate to 5 July 2023. The fourth proposition is also rejected.

61 I have decided to deny the plaintiff's application for the costs of and incidental to this proceeding, and to grant the Gidersons their costs of and incidental to this proceeding.

62 The exercise of my discretion turns largely on the plaintiff's failure to take steps to meet the requirements of s 89A(3)(b) of the Act before commencing the proceeding. The plaintiff ultimately did take those steps, but only at about the end of, or shortly after, the hearing on 5 July 2023. If he had taken them earlier, this proceeding would not have been necessary.

63 The plaintiff's delay is not adequately explained in any evidence adduced by the plaintiff in this proceeding or the Related Proceeding. The closest the plaintiff's submissions get to doing so is the following assertion (at [22]):

Also, for reasons stated in the affidavit of Casey filed 30 June 2023, Casey could not prior to the lapsing notice taking effect recover all relevant information relating to the Agreement such that the filing of substantive proceedings prior to 6 July 2023 may have been premature and could have caused the parties to incur more costs than the costs of the Casey Application.

64 I reject this assertion. The plaintiff's solicitors indicated in correspondence as far back as 1 June 2023 that they intended to commence a proceeding that would meet the requirements of s 89A(3)(b), following clear statements from McCarthy Partners of the instructions they had received from the Gidersons. The plaintiff's affidavit sworn on 30 June 2023 contains no adequate explanation of what the plaintiff did between 1 June and 27 June 2023. The affidavit included a paragraph (at [11]) deposing that the plaintiff was unable to prepare an inventory of assets and liabilities of his son, giving reasons, inter alia indicating that access to the Deceased's computer and telephone devices had only 'recently' become available. It is not clear how recently this had occurred.

65 As outlined above, by this time there had already been exchanges of emails between solicitors for the plaintiff and for the Gidersons in the period 29 May to 1 June, joining issue on the loan agreement. The plaintiff annexed to his affidavit sworn 30 June 2023 in support of his application for letters of administration ad litem a table of calculations of the alleged outstanding debt on the loan agreement, at 15% compounding interest per month, to the effect that the initial loan amount of $40,880 had grown to over $723 million as at 29 June 2023.

66 Far from deposing to an inability to 'recover information relating to the alleged loan agreement' on 30 June 2023, the affidavit: set out details relating to that alleged loan agreement, and the alleged 2018 loan agreement; stated that the grant of letters of administration ad litem was, inter alia, to allow him to commence proceedings against the Gidersons and their son to enforce the alleged loan agreements; and included an undertaking that he would bring proceedings 'as soon as I am advised I am able to obtain a formal grant of Letters of Administration'. The undertaking indicates that, at least by 30 June 2023, the plaintiff considered that he was ready to commence a proceeding relating to the alleged loan agreement.

67 The plaintiff's affidavit sworn 4 July 2023 shows that, after 30 June 2023, the plaintiff took account of additional information about the alleged loan agreement, revising the calculation of the outstanding debt claim to just over $650 million.

68 As already noted, the plaintiff also seeks his costs of and incidental to the Related Proceeding. The Related Proceeding was an ex parte proceeding in which the plaintiff sought and obtained orders that his costs be retained out of or recovered from the deceased estate. The plaintiff's submissions do not address the general principles as to making or disturbing costs orders made in such proceedings, or any provision of the Supreme Court (Administration and Probate) Rules 2014 or the Administration and Probate Act 1958. I make the assumption that I have discretion under s 24 of the Supreme Court Act 1986 and Order 63 of the Rules to vacate and re-make those orders in the manner the applicant seeks, provided there is sufficient reason to do so connected with the Related Proceeding.

69 After provisional consideration of this application, I have decided to reject it. If I had reached a contrary conclusion, it would have been necessary to allow the Gidersons an opportunity to address the plaintiff's application, because: the liberty I granted on 5 July 2023 to make submissions on costs did not extend to the costs of the Related Proceeding; the Gidersons were not joined in the Related Proceeding; and costs orders have already been made in that proceeding. However, given my decision on the merits in any event, it is not necessary to address any of these additional issues.

70 The evidence establishes relevantly that at the time the Related Proceeding was prepared and commenced, there was a controversy about the alleged loan agreements and the estate's claimed interest in the Property and (in the absence of a change in position) an adjudication of competing factual claims in a properly constituted proceeding would be required to determine that controversy. This was reasonably clear to the plaintiff by 1 June 2023. Those factual controversies cannot be resolved in a costs application of this kind. It cannot be concluded that the Gidersons acted unreasonably in making their application to the Registrar for the removal of the Caveat pursuant to s 89A of the Act, or in seeking to retain the benefit of that application once made by ignoring or refusing the entreaties of the plaintiff to abandon that application. The Act required the caveator, or anyone claiming through him, to commence a proceeding answering the description in s 89A(3)(b) if they sought to avoid the lapsing of the Caveat. The Gidersons are not to be met with a costs order in the Related Proceeding for allowing the statutory scheme to follow its natural course.

71 I will order that the plaintiff pay the Gidersons' costs of and incidental to the proceeding to date. This order will be on the standard basis, as sought by the Gidersons.

72 The Gidersons submitted that, to avoid any doubt as to whether the proceeding has concluded, those costs should be taxable forthwith pursuant to r 63.20.1 of the Rules.

73 The orders I made on 5 July 2023 included an order listing the matter for directions on a date to be fixed. Pursuant to this order, the matter has now been listed on 22 August 2023. However, given what transpired after the hearing on 5 July 2023 and the commencement of proceeding S ECI 2023 02940, the utility of this proceeding is doubtful. The interim order I made on 5 July 2023 no longer operates, as 28 days have now passed since I made it. There were no additional substantive orders sought in the originating motion other than those I have dealt with already.

74 If parties now agree that the proceeding should be dismissed, they should submit proposed minutes of consent to that effect. I will make an order under r 63.20.1 of the Rules in case this does not occur.

[1] Compare Stone Living Pty Ltd v 3 Property Group 9 Pty Ltd [2020] ACTSC 149, which was relied upon by the plaintiff. The applicable legislation in that case, Land Titles Act 1925 (ACT), s 107, was materially different from Transfer of Land Act 1958 (Vic), s 89A, which applied here. Section 107 conferred express power on the court to make an order preventing removal of the caveat the subject of a notice, whereas s 89A does not. See also Pasquale Luna v V&A Luna Pty Ltd & Anor [2023] VSC 126, [54]-[55]: the lapsing of a caveat is a legislated consequence under s 89A(3) and (5) of the giving of a notice under s 89A(1).

[2] Ritter v Godfrey [1920] 2 KB 47, 52-53; Donald Campbell & Co Ltd v Pollack [1927] AC 732, 809, 811-812; Fonterra Brands Australia Pty Ltd v Bega Cheese Ltd (Costs Ruling) [2021] VSC 117,[7].

[3] Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534, 566-7.

[4] Donald Campbell & Co Ltd v Pollack [1927] AC 732, 809, 811-812.

[5] A Team Diamond Headquarters Pty Ltd v Main Road Property Group Pty Ltd [2009] VSCA 208; (2009) 25 VR 189, [64]; Re Locktronic Systems Pty Ltd (No 2) [2009] VSC 523, [41].

[6] Jindra v Tech-Rentals Pty Ltd (No 2) [2000] VSC 132, [3]; Ragata Developments Pty Ltd v Westpac Banking Corporation [1993] FCA 72.

[7] Calderbank v Calderbank [1976] Fam 93; [1975] 3 All ER 333.