19 I also invited the defendants to make submissions.
20 I gave directions that the Practitioners provide written submissions by no later than 14 March 2007, that any submissions from the defendants be delivered by 21 March 2007, and that any submissions in reply from the Practitioners be delivered by 28 March 2007.
21 I received submissions on behalf of the Practitioners, signed by a solicitor, dated 14 March 2007. Those submissions did not deal with the specific matters upon which I had directed submissions, presumably because the solicitor had not been properly instructed by the Practitioners.
22 The matter was re-listed before me on 19 March 2007 when I extended the time for written submissions from the Practitioners to 28 March 2007 to afford them further time to address the specific matters. On that occasion Mr Byrnes, solicitor, appeared for the plaintiffs and has continued to appear for them before me. On that occasion I stood the matter over to 30 March 2007.
23 I received supplementary submissions on behalf of the Practitioners dated 28 March 2007.
24 On 30 March 2007 I stood the matter over for directions to 26 April 2007.
25 I received written submissions on behalf of the defendants dated 16 April 2007.
26 On 26 April 2007 I stood the matter down to 8 May 2007 for brief oral submissions.
27 On 8 May 2007 the Practitioners, represented by Mr Maley, solicitor, unconditionally offered and consented to pay the defendants' costs of the proceedings on an indemnity basis as agreed or assessed. He proffered short minutes of order signed by a solicitor on behalf of the Practitioners reflecting an order to that effect.
28 On this occasion Mr Forster SC who appeared with Mr Docker for the defendants, drew to my attention, and it was accepted by Mr Maley, that Mr Healey is an undischarged bankrupt. He put that in these circumstances the defendants should not be put to having to recover their costs from the Practitioners without any recourse to the unsuccessful plaintiffs in the proceedings, and that costs should, in addition, follow the event.
29 Mr Byrnes for the plaintiffs put that the circumstances which had arisen here were such that the plaintiffs should not be ordered to pay the defendants' costs but that they (the defendants) should look exclusively to the Practitioners. He sought, and I granted him leave, to put on affidavit evidence on that issue together with brief written submissions. I gave the other parties liberty to respond with brief written submissions. Those present on that occasion consented to the determination of the outstanding questions of costs without any further hearing.
30 I received written submissions on behalf of the plaintiffs dated 22 May 2007 together with an affidavit of Gregory Miles, a solicitor in the employ of Mr Byrnes and an affidavit of Mr Holmes each deposed to on 21 May 2007. I received written submissions from the defendants dated 24 May 2007.
31 The gravamen of the defendants' submissions is that the Practitioners should be ordered to pay their costs on an indemnity basis but that the defendants should not be required bear the risk of non-payment by the Practitioners. They put that they are entitled to their costs from the plaintiffs (although not on an indemnity basis) in accordance with the ordinary rule (now enshrined in UCPR r 42.1).
32 The substance of the plaintiffs' position is that just as it is appropriate that the Practitioners pay the defendants' costs of the proceedings on an indemnity basis, so they should be ordered to pay the plaintiffs' costs on that scale.
33 They submit that had they received independent advice at an earlier stage than they did, a claim would have been made against the firm and it may well have been unnecessary to institute any action against the defendants.
34 They assert that they were unaware of the issue of the statement of claim, were never asked to verify it, and until 9 February 2007, when they were served with a subpoena to attend the hearing, they were unaware of the proceedings. They put that the proceedings were commenced without their express authority.
35 In the submissions on behalf of the Practitioners, it is maintained that they were instructed by the plaintiffs to commence the proceedings.
36 I do not consider it appropriate, nor do I consider that I am in a proper position, to determine whether the Practitioners had the authority (express or implied), of the plaintiffs to prosecute the proceedings at any particular stage or at all. That determination requires resolution of disputes of fact which cannot properly be resolved in the context of this costs determination.
37 If the plaintiffs are to seek redress for any detriment arising from the conduct of the Practitioners (including from the original failure to ensure payment on time under the Agreement and any costs liability which falls on them as a consequence of failure in the proceedings), that dispute is properly to be ventilated in another forum in circumstances where a full trial of the facts is possible, not in the present summary procedure.
38 The circumstances in which the plaintiffs find themselves is not due to the conduct of the defendants.
39 There is no good reason why the ordinary principle, now enshrined in UCPR r 42.1, that costs should follow the event, should not apply as between the plaintiffs and the defendants: Milne v Attorney - General for the State of Tasmania (1956) 95 CLR 460 at 477. There is no basis however, for an order that the plaintiffs be ordered to pay any costs on an indemnity basis.