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[2003] NSWCA 214
Court of Appeal (NSW)
2002-09-23
Hodgson JA, Santow JA, Certoma AJ, Heydon JA
Original judgment source is linked above.
CITATION : Goulding v Kirby [2003] NSWCA 214 HEARING DATE(S) : 23 September 2002 JUDGMENT DATE : 5 August 2003
JUDGMENT OF : Hodgson JA at 1; Santow JA at 2 DECISION : (1) The claimants (being the appellants) pay the opponent's (being the respondent's) costs of the summons for leave to appeal (CA 40728/02) on a party/party basis, and in addition pay the costs of the appeal (CA 41078/01) including the hearing on 23 September 2002 and the appearance on 9 December 2002, but not including the costs in (2) below; and (2) The opponent (being the respondent) pay so much of the claimants' (being the appellants') costs of the appeal (CA 41078/01) as is limited to the preparation of the red and orange books and pay the claimants' (Gouldings') costs of and incidental to the Notice of Motion filed on 10 July 2002; (3) No order is made as to costs pertaining to the submissions concerning costs.
CATCHWORDS : COSTS - leave to appeal refused - appeal treated as incompetent - in the interim between the hearing and the determining of costs one of the original judges resigned from the Court of Appeal - s45AA consent given by the parties to the two remaining Judges of Appeal determining the matter - written submissions on costs - respondents challenged the competency of the appeal - letter of offer of 29 July 2002 referred to not claiming costs on the appeal but silent on costs of the application for leave to appeal - letter came too late to justify indemnity costs - competency of appeal challenged outside the time allowed pursuant to Pt 51 r27 SCR - respondent in absence of any order otherwise therefore disentitled to any costs when appeal treated as incompetent whether Court should make an order otherwise ordering - appellants' material for appeal prepared prior to challenge - duplication in need for preparation of material for concurrent application for leave to appeal and appeal. LEGISLATION CITED : Supreme Court Act s45AA Supreme Court Rules Pt 51 r27 Carolan v AMF Bowley Pty Ltd t/as Bennetts Bowling Green (NSWCA, 16 November 1995, unreported) CASES CITED : Falamaki v Wollongong City Council [2001] NSWCA 55 Kassem v Colonial Mutual General Insurance Co Ltd [2001] NSWCA 38 PARTIES : Leonard Charles GOULDING Ruth GOULDING (Appellants) Robert Raymond KIRBY (Respondent) FILE NUMBER(S) : CA 41078/01; 40728/02 COUNSEL : A Ogborne (Appellants) J Coombs, QC/ G Ellis (Respondent) SOLICITORS : The Bruce Stewart Commercial Practice (Appellants) Colin Biggers & Paisley (Respondent)
LOWER COURT District Court JURISDICTION : LOWER COURT DC7012/00 FILE NUMBER(S) : LOWER COURT Certoma AJ JUDICIAL OFFICER :
IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 41078/01 CA 40728/02 DC 7012/00
HODGSON JA SANTOW JA
5 AUGUST 2003 Leonard Charles GOULDING & Anor -v- Robert Raymond KIRBY Judgment 1 HODGSON JA: I agree with Santow JA. 2 SANTOW JA: INTRODUCTION On 23 September 2002, this Court, in a Bench comprising Heydon JA, Hodgson JA and myself, refused leave to appeal to the appellants, Mr and Mrs Goulding giving reasons. No formal order was made disposing of the appeal, but it was common ground that, unless leave was granted, it should be treated as incompetent. The question of costs between appellants and respondent was ultimately deferred, pending submissions by the parties in writing. Since that date, Heydon JA resigned from office on his appointment to the High Court, leaving Hodgson JA and myself as the two judges remaining from that Bench. Pursuant to s45AA of the Supreme Court Act , and with the consent of the parties the hearing and determination of the appeal has been completed by the two judges who remain. The only matter required to complete the appeal is to determine the outstanding question of costs, with which I deal below. 3 Submissions were received on costs from the respondent on 9 December 2002, from the appellants on 16 December 2002 and the respondent in reply on 17 January 2003. 4 Essentially, the respondent seeks an order that the appellants pay all of the respondent's costs, that is to say costs on the leave to appeal and also in relation to the competency motion of 10 July 2002. He seeks these: (a) on an indemnity basis, or alternatively (b) on a party/party basis to 28 July 2002 and on an indemnity basis from 29 July 2002 (being the date of what the respondent describes as a Calderbank letter). 5 The appellants seek orders essentially in the following terms: (a) The claimants (the Gouldings) pay the opponent's (Kirby's) costs of the summons for leave to appeal (CA 40728/02) on the party/party basis, and (b) the respondent (Kirby) pay the appellants' (Gouldings') costs of the appeal (CA 41078/01), limited to the preparation of the red and orange books and the claimants' (Gouldings') costs of and incidental to the Notice of Motion filed on 10 July 2002 (notice of motion of the respondent/opponent seeking that the appeal be struck out as incompetent).
PROCEDURAL BACKGROUND 6 The procedural background is conveniently stated in the appellants' submissions on costs, with the addition of a reference to a letter dated 29 July 2002 from the respondent (1.8A below). For convenience I set out that procedural background incorporating the letter of 29 July 2002: 1.1 The appellants filed a holding summons for leave to appeal on 27 December 2001 and had originally prepared an ordinary summons for leave to appeal from the decision of the District Court for filing on 27 March 2002 (see affidavit of Gorczyca, 19 June 2002, annexure "B"); 1.2 On 27 March 2002, prior to filing the ordinary summons for leave to appeal, the appellants asked the respondent whether he would consent to leave being given to file a notice of appeal (rather than a summons for leave to appeal) (see affidavit of Gorczyca, 19 June 2002, annexure "B"). The appellants expressly raised the question of competency and, in particular, the issue of the amount in issue on the appeal in their request for consent (see affidavit of Gorczyca, 19 June 2002, annexure "B"); 1.3 By letter dated 5 April 2002, the respondent consented to orders being made as asked by the appellants (see affidavit of Gorczyca, 19 June 2002, annexure "D"). On 8 April 2002, Registrar Irwin made orders, by consent, that leave be given to the appellants to file a notice of appeal (see affidavit of Gorczyca, 19 June 2002, annexures "E" to "G"); 1.4 Thereafter, a notice of appeal was filed on 12 April 2002, a notice of contention was filed by the respondent on 23 May 2002, the appellants prepared, filed and serve the red, black and blue appeal books in due course and filed their chronology and outline of submissions on 6 June 2002; 1.5 At a directions hearing on 6 June 2002, the respondent raised the competency of the appeal. Registrar Irwin directed that the respondent file any notice of motion challenging the competency of the appeal within 7 days, such motion to be returnable on 20 June 2002 (see affidavit of Gorczyca, 29 July 2002, paragraph 2). No notice of motion was filed by the respondent within the time directed by Registrar Irwin (see affidavit of Gorczyca, 29 July 2002, paragraph 3); 1.6 On 20 June 2002, the solicitor for respondent made an oral application for an extension of the time to file a motion challenging the competency of the appeal. Registrar Irwin refused that application and listed the appeal for hearing on 23 September 2002 (see affidavit of Gorczyca, 29 July 2002, paragraphs 4-5); 1.7 Disregarding the previous directions of Registrar Irwin, the respondent filed a notice of motion on 10 July 2002 seeking that the appeal be struck out as incompetent; 1.8 On 22 July 2002, at the first return of that motion, the appellants contended that the respondent first required an extension of the time to file the motion under Part 51 rule 25 of the Supreme Court Rules. The respondent conceded that his notice of motion required amendment. Registrar Schell made directions for the service of affidavit evidence dealing with the background to the application, including the previous directions made by Registrar Irwin, and stood the motion over to 19 August 2002; 1.8A (incorporating respondent's submissions) By letter dated 29 July 2002 the respondent offered not to seek costs of the appeal (but no mention is made of the leave to appeal) in the event that the appellants discontinued their appeal. The letter states, "our client has instructed us to offer to seek no order as to costs or (should read 'on') the appeal in the event that the appellant discontinues the appeal on or before Friday 16 August 2002. …." There is the usual warning that " should your client not accept this offer [the respondent] will rely upon this letter on the question of costs ". 1.9 On 8 August 2002, the respondent served an amended notice of motion effectively seeking an extension of the time to challenge the competency of the appeal; 1.10 In view of the decision of Woollahra Council v Sved (NSWCA, unreported, 24 July 1998) that a party faced with a formal objection to competency should, if it wishes to fall back on an application for leave to appeal, ensure that such an application is duly made prior to any contested competency application, the appellants sought to file a summons for leave to appeal prior to the directions hearing on 19 August 2002. The registry refused to accept that summons; 1.11 On 19 August 2002, the appellants obtained leave to file a summons for leave to appeal and the supporting white book. After hearing argument on the appropriate procedural course, Registrar Schell accepted the submission of the appellants that the whole of the respondent's motion (including whether an extension of time should be granted) and the application for leave to appeal should be stood over to the day already fixed for the hearing of the appeal on 23 September 2002; 1.12 At the hearing on 23 September 2002, with a view to making the most efficient use of the hearing time available and without conceding that the respondent was entitled to an extension of the time in which to file the competency motion, the appellants proposed that the court proceed by hearing the application for leave to appeal and the appeal concurrently (the appeal being subject to the granting of the application), on the basis that the appeal was incompetent. This proposal was consented to by the respondent and adopted by the court. 7 It is convenient that I deal first with the indemnity costs issue. It is fair to say that the letter of offer of 29 July 2002 was written after the costs of preparation of the appeal had all but been incurred, namely the preparation of both red, black and blue appeal books and a white book. The offer referred to not claiming the costs on the appeal, though with no separate reference to the costs of the application for leave to appeal. However, nothing turns on that. The reference to "appeal" can be read as encompassing the leave to appeal. 8 However, I consider that the letter of offer of 29 July 2002 came too late to justify indemnity costs or of itself to justify the orders sought by the respondent. It represented no real compromise of the claim. It simply offers to claim no costs on the appeal if the appellants discontinued it before 16 August 2002. 9 That leaves the question of the proper costs orders that should be made in relation to the leave to appeal and what was necessarily encompassed by it. The circumstances were that the respondent failed to challenge the competency of the appeal in accordance with the time period laid down by Pt 51 r27 SCR. This had the consequence that when the appeal was treated as incompetent, the respondent was disentitled to any costs, unless this Court otherwise orders. The question is therefore whether the Court should make an order in the circumstances, otherwise ordering. 10 The respondent contends that the court should so order. This was put principally on the following basis: (a) On 27 March 2002 the appellants' solicitor wrote to the respondent's solicitor stating that the Registrar had expressed the opinion that leave was not required (Annexure A to affidavit of E D Crennan sworn 7 August 2002). That prompted the respondent to consent. However, it transpired that either the Registrar was not of that view or that he had changed his view. There is evidence that the respondent relied on what was contained in the letter of 27 March 2002 (annexure C and D to affidavit of E D Crennan sworn 7 August 2002). That was a reasonable approach and the respondent should not be penalized because either the Registrar changed his mind or because the letter of 27 March 2002 did not accurately express the Registrar's view. (b) the learned trial judge awarded the respondent costs on an indemnity basis, giving the reason that the proceedings should not have been brought. We do not have a transcript of the reasons for the trial judge's costs order. This is Junior Counsel's recollection of the reason he gave. (c) By letter dated 29 July 2002 (copy herewith) the respondent offered not to seek costs of the appeal in the event that the appellants discontinued their appeal. That offer should have been accepted. The respondent should not now be put in a worse position, having offered to resolve this matter prior to today on the basis that each party pay their own costs of the appeal. (d) The challenge to competency would have been heard earlier but for the respondent twice applying for an adjournment: first, on 22 July 2002 when it was suggested that the appellants' solicitor wished to file an affidavit respondent [sic] to the respondent's affidavit as to quantum; secondly, on 19 August 2002 when the appellants belatedly suggested they wanted to file a Summons for Leave to Appeal. Despite a white Folder being filed that day, the appellants opposed the competency motion being heard on that day." [written submissions of respondent of 9 December 2002] 11 The respondent relies on a further basis, namely that "competency was vigorously contested until the day of the hearing when it was conceded". That is not correct. As the appellants point out when the question of the competency of the appeal arose for consideration on the leave application before this Court on 23 September 2002, the appellants did not concede that the respondent was entitled to an extension of time in which to file the competency motion. Rather they properly adopted a course for the efficient disposal of the real issue, namely by having the leave application then determined. 12 The appellants rely on what is said under the procedural background, particularly 1.8 to 1.12 but dispute (d) above. The appellants say as to (d): "As to paragraph 2(d) of the submissions, it is not correct that the hearing of the competency motion was delayed by the appellant. The respondent failed to file any motion within the time directed by Registrar Irwin on 6 June 2002 and was refused an extension of time on 20 June 2002. When a notice of motion was filed (in disregard of the previous directions), it was defective and required amendment (see paragraph 1.8 above). The appellants did not seek any adjournment of the hearing of the motion on 22 July 2002; rather, Registrar Schell made directions for the preparation of the evidence on the motion in the normal course on the first return date (see paragraph 1.8 above). As at that date, the respondent had failed to put into evidence the background to the motion, including its failure to comply with the directions of Registrar Irwin and the registrar's previous refusal of the motion. The appellants sought leave to file a summons for leave to appeal at the appropriate time: Woollahra Council v Sved (NSWCA, unreported, 24 July 1998) (see paragraph 1.10 above). Given that, by 19 August 2002, the hearing of the appeal was only one month away on 23 September 2002, the decision of Registrar Schell to stand the competency motion over to the hearing of the appeal was entirely appropriate. In any event, it was the decision of Registrar Schell, not anything done by the appellants, which was responsible for the motion being stood over to the hearing of the appeal." 13 It is not possible to resolve this issue of delay and who was responsible on the written submissions. But it is not necessary to do so. 14 The appellants submit that irrespective of the position taken initially or as later varied by the Registrar, the consequence of that should not be visited upon the appellants so far as any cost orders are concerned. The respondent was legally represented "and, presumably received appropriate advice on whether to consent to the filing of a notice of appeal or to object to the competency of such an appeal and insist on a summons for leave to appeal". The appellants submit that if "the respondent had taken his objection at the appropriate time namely when he was asked to consent to the filing of a notice of appeal instead of a summons for leave to appeal on the grounds that the amount in issue was in excess of the monetary limit then the appellant would simply have filed the summons for leave to appeal and the matter would have continued as a standard application for leave to appeal. There would then have been no costs incurred in relation to the competency motion and no costs in preparing the appeal (rather than the application for leave to appeal)" 15 I interpolate here that the appellants would however still have had to incur costs for the appeal, against the possibility that if leave were granted the appeal would have been heard concurrently. 16 The appellants then conclude by submitting: "Clearly the costs incurred by the appellants on the competency motion were useless or unnecessary. The costs on the appeal are not so clear cut, in that it enabled the Court to conduct a concurrent hearing of the appeal and the application for leave to appeal. Nevertheless, there was clear duplication in the need for the preparation of both a white book and a red book and sets of submissions in both proceedings." 17 In regard to preparation of books for the appeal, I have noted earlier that, following the filing of the Notice of Appeal on 12 April 2002 and a Notice of Contention filed on 23 May 2002, the appellants did prepare, file and serve the red, black and blue appeal books, filing their chronology and outline of submissions on 6 June 2002. The concession above concerning the costs on the appeal proper was correctly made. I would agree that there was some duplication in the need for preparation of both a white book for the leave and the red book and the sets of submissions in both proceedings in relation to the appeal, following the notice of appeal and notice of contention. But these did allow the merits of the appeal, so far as relevant to leave, to be argued, and would have allowed the appeal to be argued concurrently, if leave had been granted. 18 As to the other matters put by the respondent (in both the written submissions and submissions in reply) in support of indemnity cost orders, these do not in my judgment, warrant any indemnity costs or other cost orders in favour of the respondent. In particular I consider that the reasons of the trial judge for deciding a question of costs of the trial on an indemnity basis do not bear materially upon the proper orders for costs of the application for leave to appeal. The position before the Department of Fair Trading and the Fair Trading Tribunal can have likewise no bearing upon the cost orders appropriate in this Court. However, the respondent's success on the leave to appeal is clearly significant. 19 In all the circumstances I consider there is justification for the Court otherwise ordering, in terms of Pt 51 r27(2), costs on a party/party basis in favour of the respondent but only to the extent noted. I am influenced by the appellants' solicitor's letter of 27 March 2002, quoting the Registrar that their clients "in fact do not require leave to appeal …". That and the other circumstances detailed above sufficiently distinguish this case from Kassem v Colonial Mutual General Insurance Co Ltd [2001] NSWCA 38 at [81]; Falamaki v Wollongong City Council [2001] NSWCA 55; Carolan v AMF Bowley Pty Ltd t/as Bennetts Bowling Green (NSWCA, 16 November 1995, unreported). I would propose orders as follows, in all the circumstances (including what occurred in relation to the respondent filing a notice of motion on 10 July 2002 in disregard of Registrar Irwin's previous directions). I note that each party has had some success as regards the submissions as to costs, so make no order as to those. However, it is fair to say that the cost orders do give some weight to the fact that the respondent was successful in opposing leave to appeal, and on a basis going to merits.
PROPOSED ORDERS (1) The claimants (being the appellants) pay the opponent's (being the respondent's) costs of the summons for leave to appeal (CA 40728/02) on a party/party basis, and in addition pay the costs of the appeal (CA 41078/01) including the hearing on 23 September 2002 and the appearance on 9 December 2002, but not including the costs in (2) below, and (2) The opponent (being the respondent) pay so much of the claimants' (being the appellants') costs of the appeal (CA 41078/01) as is limited to the preparation of the red and orange books and pay the claimants' (Gouldings') costs of and incidental to the Notice of Motion filed on 10 July 2002. (3) No order is made as to costs pertaining to the submissions concerning costs. **********
Last Modified: 08/18/2003 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Goulding
Kirby