Background
17The plaintiff leased premises in Brookvale from the defendant under a lease made on 1 February 2009.
18In May 2010 Warringah Council issued a notice that the premises were not compliant with their original development approval and that certain structures within the premises be demolished and removed.
19In June 2010 the plaintiff commenced these proceedings. By an Amended Summons filed on 28 June 2010 the plaintiff sought an order for specific performance to enable him to stay in the premises and have the defendant rectify the premises to comply with Council's requirements, and alternatively damages.
20By a letter of 8 November 2010 from its solicitor, the defendant offered to resolve the plaintiff's claim on the following terms:
"We have been instructed to put forward to you an offer on the following terms as full and final settlement of the proceedings
1) The Defendant to pay the Plaintiff $10,000 in full and final satisfaction of the Plaintiff's claims;
2) Each party to bear their own legal costs;
3) Deed of Settlement entered into on normal terms between the parties with mutual releases;
4) The proceedings be dismissed.
This offer is made in accordance with the principles in Calderbank v Calderbank [1975] 3 All ER 333."
21The plaintiff did not accept the offer.
22In December 2010 the plaintiff was advised by his insurer that, due to the non-compliance of the premises with its Development Approval, his policy would be cancelled. He decided to terminate the lease and to amend his claim by deleting the claim for specific performance and to seek damages only. He did so by filing a Second Amended Summons on 25 February 2011.
23The hearing proceeded on 11 and 12 July 2011. His Honour found that the defendant was in breach of the lease at the time it was entered into, that the lease was void from the time Council served its first notice and that the plaintiff was entitled to nominal damages of $5.
24On 21 July 2011, his Honour dealt with costs as I have set out above.
25On 12 August 2011, the plaintiff filed and served a Notice of Intention to Appeal. That document stated that the plaintiff intended to commence appeal proceedings within three months after the material date; stated to be 18 October 2011.
26Before me, it was common ground that the time by which it would have been necessary for the plaintiff to file a notice of appeal was in fact 21 October 2011.
27The plaintiff discovered the Slip in September 2011.
28The plaintiff gave the following evidence about that matter:
"After the final hearing of 21 July 2011 [Mrs Georgouras] assisted me in considering whether to lodge an appeal. In September 2011 we discovered [the Slip]. [Mrs Georgouras] then undertook some research about that matter.
[Mrs Georgouras] told me that she had concluded that it was now too late for the applicant to have the orders amended and that the applicant must have accepted the status quo through not applying to have the orders amended. Under the orders in their current form there were no costs which I was required to pay. I therefore decided there would be no benefit in pursuing an appeal concerning the costs issue and that, without pursuing that part of the appeal, there was no utility in appealing from any other part of the judgments. I therefore decided not to pursue an appeal."
29Mrs Georgouras gave this evidence:
"I believed that Nicholas Georgouras may have two arguments for appeal:
(a) the quantum of damages - in my view the damages were unfair in that they did not address my loss of interest in the property or any expectation loss from my exhibition with the Greek Festival of Sydney
(b) the order for costs - in my view the indemnity costs awarded to defendant were unfair because Justice Einstein failed to give proper consideration to the state of the litigation at the time the offer was made in determining whether the applicant's Calderbank offer was more favourable than the judgment.
In September 2011, while considering whether to lodge an appeal we discovered the error in the dates in the orders made by Justice Einstein. I then sought to understand what that might mean. I referred to the Uniform Civil Procedure Rules and to the Judicial Commission Civil Trials Bench Book.
It appeared to me that the relevant rule was rule 36.16(3) of the Uniform Civil Procedure Rules (2005), which I understood to allow the Court to set aside or vary a judgment providing that a notice of motion was filed within 14 days. Also the following passage appeared in the Bench Book, at [8-0150] "Miscellaneous Costs Issues - Correcting or varying a costs order":
Costs orders may be corrected under the slip rule (r 36.17), such as where some item was overlooked at the time of the original order: Pacific Steel Constructions Pty Ltd v Barahona (No 2) [2010] NSWCA 9 at [9]. A costs order may be varied after it has been entered pursuant to a motion filed within 14 days: r 36.16 (3A).
This led me to believe that the applicant had fourteen days in which to enact the 'slip rule'. I discussed my research with Nicholas and we decided that there was no purpose in pursuing the appeal since there were not costs to pay under the order."
30There is no dispute before me that Mrs Georgouras' analysis of the legal situation was wrong and that there is, in effect, no time limit for making an application under UCPR r 36.17.
31However, as I have mentioned, I have been informed that neither the plaintiff nor Mrs Georgouras has legal qualifications.
32It is not suggested that Mrs Georgouras, and thus the plaintiff, was not genuinely of the view that by September 2011, the defendant was out of time to correct the Slip. Nor was there any dispute that it was on that basis that the plaintiff decided not to pursue the appeal.
33In the meantime, the defendant and its solicitors gave consideration to the steps necessary to implement Einstein J's costs order of 21 July 2011 as they understood it to have effect.
34The solicitor who had carriage of the matter on behalf of the defendants, Ms Bernauer, gave this evidence:
"Upon receipt of the Notice of Intention to Appeal, I was instructed by my client not to proceed with the costs assessment process until the appeal period had lapsed. My client advised that it did not wish to incur the costs of preparing a Bill of Costs until it was known whether the Plaintiff would be lodging an Appeal in the matter."
35Once the time to appeal expired, Ms Bernauer engaged a costs consultant to prepare a bill of costs. The costs consultant was instructed to prepare the bill of costs on the basis that the defendant was entitled to recover costs after 8 November 2010. The process of preparing a bill of costs took a number of months. It was not until 8 March 2012 that a bill of costs was served on the plaintiff.
36The defendant then sought to have the costs assessed. The Court appointed Mr Vincent Goldrick as costs assessor.
37On 24 May 2012, the plaintiff wrote to Mr Goldrick, attached a copy of Einstein J's judgment of 21 July 2011, pointed out that the costs order was "from 8 November 2011" and asserted that the bill of costs was "invalid".
38The plaintiff said he had also sought procedural advice from the Registrar of the Supreme Court "who declared that the parties must follow the sealed orders of the Court".
39The plaintiff concluded his letter as follows:
"Therefore, I consider that, as the whole of the applicant's Bill of Costs does not replicate the Orders of the Court, is invalid and should never have been submitted for Costs Assessment."
40At this time, the plaintiff still believed that the defendant was out of time to cure the Slip.
41Mr Goldrick sent Ms Bernauer a copy of that letter. Ms Bernauer gave evidence, which I accept, that it was only on reading this correspondence that she became aware of the Slip.
42On 6 June 2012, Ms Bernauer wrote to Mr Goldrick drawing attention to the references in Einstein J's judgment of 21 July 2011 to "November 2010" (not "2011"). Ms Bernauer concluded:
"On this basis, we invite you to consider the judgment itself and the references throughout it on numerous occasions to November 2010.
In the event that you consider it necessary for us to make an application by way of Notice of Motion, pursuant to rule 36.17 of the Uniform Civil Procedure Rules 2005 (NSW), kindly let us know and we will attend to this expeditiously in order to avoid any further delay in the Costs Applicant receiving Costs Certificate from you." (emphasis in original)
43Having received a copy of that letter, the plaintiff wrote to Mr Goldrick on 14 June 2012:
"The applicants do not have any legal authority to 'invite' other entities to change the cost orders. If they wish to amend the orders there is a process that must be followed which, for the past year, they have not undertaken."
44That correspondence should have made it perfectly clear to the defendant's legal representatives that, if the Slip was to be corrected, it would be necessary for the defendant to bring an application under UCPR r 36.17. However, no application was then made.
45Instead, Mr Goldrick continued on his task of costs assessment. Many months went by.
46On 11 October 2012, Mr Goldrick wrote to the "Principal Registrar, Costs Assessment" asking the Court to correct the Slip of its own motion, which, of course, the Court can do under UCPR r 36.17:
"Pursuant to Rule 36.7 [sic] the court may, on application or of its own motion, correct a clerical mistake or an error arising from an accidental slip in a judgment, order or certificate. In the interests of correcting this issue expeditiously and without the parties incurring the further costs of filing a Motion I request you approach the Judge's Associate in question and request His Honour review and, if appropriate, correct this slip and issue a corrected certified copy of the judgment." (emphasis in original)
47The plaintiff received a copy of that letter and on 17 October 2012 wrote to the Court asserting that it was too late to cure the Slip.
48The plaintiff still believed that the defendant had only 14 days to act to cure the Slip.
49The plaintiff wrote:
"I have informed Mr. Goldrick of my objection to the current cost assessment action on the grounds that the Applicant's Bill of Costs did not reflect the sealed orders of the Court. However, Mr Goldrick has seen fit to have the final orders issued by the now retired Justice Einstein varied to reflect the wishes of the Applicant. I find this action rather arbitrary for a Cost Assessment process, as the Applicant has had over a year to seek an extension of time for filing a Notice of Motion to vary the orders."
50The defendant's solicitors received a copy of that letter.
51That must have made it clear, if the matter was not already clear, that if the defendant wished to have the Slip cured, it would have to bring an application under UCPR r 36.17.
52The costs assessment process ceased at that point.
53Thereafter, the position the defendant adopted was to endeavour to avoid incurring costs and to seek to persuade the plaintiff that he ought to agree to the Slip being cured.
54On 29 January 2013, Ms Bernauer received instructions from Ms Karlie Bombardier, who I infer is a person associated with the defendant, as follows:
"We don't want to spend any further money in these proceedings unless we really have to. The Judge was clearly referring to 2010 and not 2011. The letter of offer was dated November 2010. November 2011 had not even taken place at the date of judgment so it doesn't make sense that they would argue the point. Can you try and sort it out with them. You can prepare the documents you need to but don't start proceedings unless it's a last resort."
55Over the next few months, Ms Bernauer wrote to and tried to telephone the plaintiff and Mrs Georgouras without success.
56I now turn to the two bases upon which the plaintiff resists the defendant's application.