The defendants apply for an order for indemnity costs of the proceedings pursuant to liberty granted on 19 May 2017. [1] On that date an order was made that the plaintiff pay the defendants' costs of the proceedings as a consequence of the striking out of the plaintiff's claim. The plaintiff, Mr Hardcastle, is absent.
On 22 May 2017 Mr Hardcastle forwarded an email to my associate, copied to the defendants' solicitors, stating:
"I will have to ask the judge to disqualify himself, it is my view that His Honour is not acting fairly and that he has malice towards me, and that there would be a perception that he was acting to prevent a member of the legal fraternity from having to answer the potential consequences of perjury etc.
This is my view and I would ask his Honour to reflect on his state of mind and answer the question of if he was biased against me."
At that stage, there were no proceedings before me as the motion concluding the proceedings had been dealt with some days earlier.
It is appropriate, in the first instance, that I consider whether I should disqualify myself. The ex tempore judgment that I gave in striking out the plaintiff's claim has not yet been published, [2] but I recall no criticism being made of Mr Hardcastle personally, only that his proceedings were defective in a number of respects. Those findings could not indicate unfairness or malice towards Mr Hardcastle to the reasonable observer. I do not regard myself as having any feelings of unfairness or malice towards Mr Hardcastle, to the extent that he is asserting actual bias.
As to Mr Hardcastle's assertion that I was acting to protect a member of the legal fraternity from the consequences of perjury, the details of that allegation are not clear. However, these proceedings are an unlikely vehicle to investigate the conduct of a legal practitioner as they are concerned with the claim Mr Hardcastle is making against the defendants. If Mr Hardcastle thought that his allegation against a legal practitioner had any merit, it would be open to him to refer it to the Law Society.
The question of the legal practitioner's conduct was the subject of a motion that was to be heard by me on 19 May 2017, but was withdrawn by Mr Hardcastle shortly beforehand and, as a result, was not the subject of any findings by me.
For those reasons, I do not propose to disqualify myself from hearing the application.
The second matter is the absence of Mr Hardcastle. The evidence before me reveals that Mr Hardcastle had notice on several occasions of the application today by the defendants. That notice was given via his email address, which is noted as a contact point on his statement of claim, and on several occasions he has responded to emails sent to that address by my associate or by the defendants.
Mr Hardcastle does, in the email correspondence, refer to late contact with him about the application, although he does not expressly state that that late contact was the only contact with him. He says, "[Y]esterday noon I was sent an email from Santos with a submission and affidavit telling me that there was a hearing on Wednesday 7th June 2017". [3]
From the bundle of email correspondence that constitutes the evidence, I am satisfied that Mr Hardcastle was at all times aware of the publication being made by the defendants, and circumstance that he was provided with a submission and affidavit in more recent times is not a reason of itself to postpone the hearing of the motion. Indeed, Mr Hardcastle does not in terms ask for that to occur.
In that same email of 6 June 2017, Mr Hardcastle states:
"[A] hearing tomorrow should be stayed pending the outcome of my Appeal. In any case it is impossible for me to be there or to prepare a response to Santos documents only [just] provided to me."
I was informed by the defendants that a notice of intention to appeal has been lodged by Mr Hardcastle in respect of my decision of 19 May 2017. Whilst leave might be required to appeal from that decision, that is a matter for the appellate tribunal. It is sufficient to observe on this application that Mr Hardcastle is seeking a stay and claims an impossibility to attend today. Mr Hardcastle has given no explanation of why it was impossible for him to be here. He has not applied for an adjournment for any period and has not indicated why he would not be able to appear by telephone as he has done on previous occasions. In these circumstances, I propose to proceed with the application.
As to the assertion that this hearing "should be stayed pending" the appeal, I note that the mere filing of a notice of appeal does not operate as a stay under r 50.7 of the Uniform Procedure Rules 2005 and although a stay might sometimes be granted pending an appeal, often on conditions, I do not regard the assertion in the 6 June email as constituting an application. It seems to me that the Court of Appeal and the parties would be better served if the matter was entirely concluded in this Court prior to the appeal being heard, a reason why the question of a special costs order should not be stayed.
Whilst the utility of a party pursuing costs while an appeal is on foot might be doubted, as I have indicated, the sending of an email asserting that a stay should be granted does not properly constitute an application for a stay and, in any event, is entirely unsupported by evidence. It is resisted, and any stay granted would likely require an undertaking by Mr Hardcastle in relation to the appeal proceedings being pursued with reasonable expedition, and perhaps other conditions may be appropriate, such as in respect of security. None of these matters have been canvassed in Mr Hardcastle's email and in these circumstances, I do not propose to grant a stay on the basis of an assertion in an email to my associate that a stay should be granted.
Dealing now with the substantive application before me by the defendants for indemnity costs, the defendants base their claim on three grounds:
1. that the claim was hopeless;
2. that it was conducted in a manner to cause unnecessary costs; and
3. that there were genuine offers of compromise made by the defendants which were said to be unreasonably rejected by the plaintiff.
As to the offers of compromise, in each case they involved an offer to purchase Mr Hardcastle's land. The relevance of this offer may only be apparent with some background, which is set out in my earlier judgment of 19 May 2017. In short, the proceedings concerned various claims by Mr Hardcastle arising out of a small gas fuelled power station on an adjacent block with which the defendants were connected. Thus, the offers involved an offer by the defendants to purchase Mr Hardcastle's adjoining land and thereby compensate him for his property and spare him from the inconvenience of owning property next to a power station.
Ordinarily I would not regard an offer to purchase land and the rejection of such an offer as a basis for a special costs order. The courts, in my view, would be reluctant to find that a party is acting unreasonably in not selling their own real estate. The defendants argue that the parties have been negotiating to buy the land of Mr Hardcastle at a premium. The size of the appropriate premium was a matter on which Mr Hardcastle and the defendants differed.
Mr Hardcastle at one stage on the evidence before me indicated that the offered amount was acceptable, but required recitals in the agreement which Santos was unwilling to accept, perhaps because the defendants regarded the recitals proposed by Mr Hardcastle to be false. In any event, I do not regard Mr Hardcastle's rejection of an offer requiring him to sell the land as unreasonable, even if those offers included a price in excess of the market value of the land as they appeared to do. For that reason, I would not be persuaded to make a special costs order on the third basis submitted by the defendants.
As for the matter of whether the claim is hopeless, the claim has already been found by the Court to be hopeless or "manifestly untenable" in the earlier judgment. That was the basis of the strike out. However, that finding, or a similar finding, would occur on all occasions when proceedings are struck out or summarily dismissed on the basis of no reasonable cause of action being disclosed, and ordinarily that would not produce automatically an order for indemnity costs.
Further, Mr Hardcastle, as a self‑represented litigant, might be expected to be less aware of the various elements of the cause of action, the way in which causation of damage is crucial to proceedings for damages, the impact of limitation periods and the like.
For these two reasons, I am not persuaded that the fact that the claim was manifestly untenable is sufficient for an order for indemnity costs.
I was informed that Mr Hardcastle had previously alleged dishonest conduct in an earlier version of the statement of claim, but that was struck out. When two earlier versions were struck out, one was subject to an ordinary costs order in favour of the defendants and in the other, costs were reserved. Reserved costs would be included in the order for costs I made on 19 May 2017 by virtue of UCPR r 42.7 and the earlier order for costs would be applicable in respect of the costs of that application. The history of the case does not cause me to alter my view that the hopelessness of the case is, in the case of a self‑represented litigant, insufficient to persuade me that a special costs order should be made.
The other matter raised by the defendants was that the proceedings were conducted in a manner to cause unnecessary costs. The significance of this argument must be viewed against the circumstance that Mr Hardcastle was a self‑represented party and it might be expected that some things done without the benefit of legal assistance are likely to increase the level of cost to the other side.
I was referred to the allegations of egregious conduct by Santos that Mr Hardcastle had previously made in emails and other places including "lying to the government and to the courts". There is no evidence before me to support Mr Hardcastle's assertions. Nor are they in the pleadings before me.
As costs orders are compensatory, not punitive, I would be reluctant to make a special costs order in respect of the proceedings solely on the basis of outrageous, unfounded comments in emails, at least where those comments do not clearly cause an increase in costs to the defendants. Where no obvious costs increase has occurred, a proper compensatory costs order would, in my view, be the appropriate order as to costs.
These allegations were, however, raised in a motion Mr Hardcastle filed on 7 February 2017, which was not pursued at the hearing before me having been withdrawn shortly beforehand. Given that the motion raised allegations of egregious conduct, which was withdrawn without any explanation before me, I am persuaded that a special costs order should extend to any costs incurred in relation to that motion but not otherwise.
Accordingly, the orders are:
1. To the extent that any application for recusal or postponement or stay is made by the plaintiff, those applications are refused.
2. Dismiss the defendants' application for indemnity costs generally, but order that the costs of and incidental to the plaintiff's notice of motion filed 7 February 2017 be assessed on an indemnity basis.
3. Order that the plaintiff's costs of the application today be part of the costs of the proceedings but not be part of the costs of the plaintiff's motion filed 7 February 2017.
4. Note the entitlement of the plaintiff to apply to set aside or vary the orders today under Uniform Civil Procedure Rules 2005 r 36.16(2)(b) (absence of a party) and r 36.16(3A) (application within 14 days of order).
[2]
Endnotes
Now published at Hardcastle v Santos Limited [2017] NSWDC 137.
See note 1.
Email, 6/6/2017 at 12.43pm.
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Decision last updated: 10 December 2018