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Category: Costs

Parties: Carla Ruth Quine (Plaintiff/Cross-Defendant)
Gerringong Storage Pty Ltd (First Defendant)
Andrew James Scott (Second Defendant/Second Cross-Claimant)
Tara Leigh-Ann Sullivan (Third Defendant/First Cross-Claimant)
Eye on the Scotts Pty Ltd (Fourth Defendant/Third Cross-Claimant)
TKS Investments Pty Ltd (Fifth Defendant/Fourth Cross-Claimant)
Gerringong Commercial Hub Pty Ltd (Sixth Defendant)

Representation: Counsel:
A Crossland (Plaintiff/Cross-Defendant)
V Bedrossian SC/A Munro (Defendants/Cross-Claimants)
Solicitors:
Attwood Marshall Lawyers (Plaintiff/Cross-Defendant)
Carter Ferguson Lawyers (Defendants/Cross-Claimants)

File Number(s): 2024/250669

Judgment

Background to this application

1. This judgment deals with the costs of proceedings brought by Ms Quine seeking relief in respect of the affairs of Gerringong Storage Pty Ltd (“GSPL”) as the trustee of the Gerringong Storage Unit Trust (“GSUT”). I delivered judgment in those proceedings on 2 April 2025 (Re Gerringong Storage Pty Ltd [2025] NSWSC 302) (“Primary Judgment”). I directed the parties to bring in agreed short minutes of order to give effect to the judgment, including as to costs, or their respective draft orders and submissions if they did not reach agreement. The parties reached agreement as to several orders, and the Defendants propose additional orders that the Plaintiff’s Second Further Amended Statement of Claim (“Statement of Claim”) be otherwise dismissed and that their Statement of Cross-Claim (“Cross-Claim”) be dismissed, which are appropriate to give effect to the conclusions that I reached in the Primary Judgment. The parties did not reach agreement as to the question of costs. That was perhaps not surprising, given the history of the proceedings, but that approach exposed the parties to the risk of incurring significant costs in an assessment which they would have not incurred had they adopted a more constructive approach.

The applicable principles

2. It is, of course, uncontroversial that s 98 of the Civil Procedure Act 2005 (NSW) confers on the Court a wide discretion with respect to costs, and the Court has discretion to determine by whom, to whom and to what extent costs are to be paid, and costs will ordinarily follow the event unless it appears to the Court that some other order should be made as to the whole or any part of the costs, in accordance with r 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”). The onus is on the losing party to establish the basis for a departure from the usual costs rule in UCPR r 42.1: Waterman v Gerling Australia Insurance Co Pty Ltd (No 2) [2005] NSWSC 1111 at [10]. Mr Bedrossian, with whom Mr Munro appears for the several Defendants, accepts that the principle that costs should follow the event is the “guiding principle” with respect to costs: Northern Territory v Sangare [2019] 265 CLR 164; [2019] HCA 25 at [24]-[25]. Obviously, that principle requires that the “event” be identified in the relevant circumstances.

3. Mr Bedrossian also refers to Golding v Vella (No 2) [2001] NSWSC 731, where Barrett J (as his Honour then was) observed at [8] that “… [it is] perhaps unwise to be too technical about measuring success on the various issues pleaded: ‘one does not look at issues as if they were pleaders’ issues, but approaches the matter with a broad brush.’: Fexuto Pty Ltd v Bosnjak Holdings Pty Ltd (No 3) (1998) 30 ACSR 20 at 22 per Young J.” Mr Bedrossian also recognises that, in James & Ors v Surf Road Nominees Pty Ltd (No 2) [2005] NSWCA 296 at [33], the Court of Appeal observed that, in cases in which a party has received only partial success:

“1. Ordinarily, costs follow the event and a successful litigant receives his costs in the absence of special circumstances justifying some other order.

2. Where a litigant has succeeded only upon a portion of his claim, the circumstances may make it reasonable that he bear the expense of litigating that portion upon which he has failed.

3. A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the party’s costs of them. In this sense, “issue” does not mean a precise issue in the technical pleading sense but any disputed question of fact or of law.”

4. In Commonwealth of Australia v Gretton [2008] NSWCA 117, Hodgson JA (with whom Mason P agreed) in turn observed (at [121]) that:

“In my opinion, underlying both the general rule that costs follow the event, and the qualifications to that rule, is the idea that costs should be paid in a way that is fair, having regard to what the court considers to be the responsibility of each party for the incurring of the costs. Costs follow the event generally because, if a plaintiff wins, the incurring of costs was the defendant’s responsibility because the plaintiff was caused to incur costs by the defendant’s failure otherwise to accord to the plaintiff that to which the plaintiff was entitled; while if a defendant wins, the defendant was caused to incur costs in resisting a claim for something to which the plaintiff was not entitled … Departures from the general rule that costs follow the event are broadly based on a similar approach.” (citations omitted)

5. In Monie v Commonwealth of Australia (No 2) [2008] NSWCA 15 (“Monie”) at [64]–[66], Campbell JA (with whom Mason P and Beazley JA largely agreed, including on this issue) observed that:

“The usual circumstance in which a court will deprive the successful party of the costs relating to an issue on which the successful party lost, is when that issue is clearly dominant or separable. In Waters v P C Henderson (Australia) Pty Ltd (NSW Court of Appeal, 6 July 1994, unreported) Mahoney JA said, at 4–5:

“In my opinion the principles in this regard are properly stated in the Supreme Court Act and Rules. S76 of the Supreme Court Act provides that the Court has a discretion with full power to determine by whom and to what extent costs are to be paid. In the Rules, Pt52 r11 provides that:

“If the Court makes any order as to costs, the Court shall, subject to this Part, order that the costs follow the event, except where it appears to the Court that some other order should be made as to the whole or any part of the costs.”

In the notes to the Rules, Pt52.11.2, the following appears:

“Where the proceedings involve multiple issues the application of the rule that costs follow the event may involve hardship where a party succeeds on some issues and yet fails on others. Particularly is this so where, for example, a defendant succeeds on issues that occupied the bulk of the time taken by the proceedings. Nevertheless unless a particular issue or group of issues is clearly dominant or separable it will ordinarily be appropriate to award the costs of the proceedings to the successful party without attempting to differentiate between those particular issues on which it was successful and those on which it failed.“

That principle has frequently been approved in this Court: eg James v Surf Road Nominees Pty Ltd (No 2) [2005] NSWCA 296 at [32]; Elite Protective Personnel Pty Ltd v Salmon (No 2) [2007] NSWCA 373 at [6].

In the present case, the claim for significant economic loss was an important one, but not a dominant one. Nor do I regard it as a separable issue. Essentially what has happened is that [the plaintiffs] have succeeded in a claim that they suffered economic loss in consequence of the negligence of the Commonwealth, but have not made out as large a quantum of economic loss as they had claimed at the trial. In those circumstances, I see no reason to deprive them of any part of their costs of the trial.”

6. Mr Bedrossian also refers to the summary of the relevant principles in Corbett Court Pty Ltd v Quasar Constructions (NSW) Pty Ltd [2008] NSWSC 1423 at [30]-[31], as follows:

“The general rule can, in the discretion of the Court, be displaced in appropriate cases. Relevant authorities have been recently and conveniently collected by White J in Short v Crawley (No 40) [2008] NSWSC 1302 at [25]–[32].

Examples of instances where the general rule may be displaced include the following:

a. a costs order in favour of a successful party can be modified to reflect its failure on particular issues even if the successful party did not act unreasonably in raising those issues: Permanent Trustee Australia Ltd v FAI General Insurance Co Ltd (Supreme Court of New South Wales, Hodgson CJ in Eq, 3 June 1998, unreported, BC9802305 at 10–11); …

d. where a litigant has succeeded only upon a portion of his claim, the circumstances may make it reasonable that he bear the expense of litigating that portion upon which he has failed: Hughes v Western Australian Cricket Assn (Inc) (1986) 8 ATPR 40-748 at 48,136;

e. where the proceedings involve multiple issues departure from the general rule may be warranted particularly where the losing party has succeeded on issues which occupied significant time. Nevertheless the application of the general rule may involve hardship where a party succeeds on some issues but fails on others particularly where the losing party succeeds on some issues. However unless a particular issue or group of issues is clearly dominant or separable it will ordinarily be appropriate to award the costs of the proceedings to the successful party without attempting to differentiate between those particular issues on which it was successful and those on which it failed: Ritchie’s Uniform Civil Procedure NSW at [42.1.15]; Waters v PC Henderson (Australia) Pty Ltd (New South Wales Court of Appeal, 6 July 1994, unreported, BC9404952 at 5); Short v Crawley (No 40) at [27]–[28];

f. a successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other party’s costs of them: Hughes v Western Australian Cricket Assn (Inc) at 48,136.”

7. In Bostik Australia Pty Ltd v Liddiard (No 2) [2009] NSWCA 304 (“Bostik”) at [38], the Court of Appeal also noted that, in relation to trials, it may be appropriate to deprive a successful party of costs or a portion of the costs if the matters upon which that party did not succeed took up a significant part of the trial, either by way of evidence or argument. I also addressed the circumstances in which costs could reflect a mixed result of proceedings in Re Metal Storm Ltd (subject to deed of company arrangement) [2014] NSWSC 1170 at [47] as follows:

“In [Bostik] at [38], the Court of Appeal noted that, where there are multiple issues in a case, the Court generally does not attempt to differentiate between the issues on which a party was successful and those on which it failed. However, the Court also pointed to several circumstances in which a different approach might be justified, and noted (at [38]) that:

“Whether an order contrary to the general rule of costs follow the event should be made depends on the circumstances of the case viewed against the wide discretionary powers of the Court, which powers should be liberally construed.”

Similarly, in Corbett Court Pty Ltd v Quasar Constructions (NSW) Pty Ltd [2008] NSWSC 1423 at [28]–[31], in a passage recently approved by McDougall J in The Owners — Strata Plan 61162 v Lipman [2014] NSWSC 622 at [241], Hammerschlag J referred to the general rule and to cases where its application may be displaced. In particular, the Court may deprive a successful party of the costs relating to an issue on which it lost when that issue is clearly dominant or separable: [Monie] at [64]; Doppstadt Australia Pty Ltd v Lovick & Son Development Pty Ltd (No 2) [2014] NSWCA 219 at [17]. Where there has been a mixed outcome in proceedings, and costs should be apportioned as between different issues, the Court will generally take a relatively broad brush approach, largely as a matter of impression and evaluation: Fexuto Pty Ltd v Bosnjak Holdings Pty Ltd (No 3) (1998) 30 ACSR 20 at 22.”

8. In Doppstadt Australia Pty Ltd v Lovick & Son Developments Pty Ltd (No 2) [2014] NSWCA 219, the Court of Appeal cited Monie and Bostik and observed at [18] that:

● Where there are multiple issues in a case the Court generally does not attempt to differentiate between the issues on which a party was successful and those on which it failed. Unless a particular issue or group of issues is clearly dominant or separable it will ordinarily be appropriate to award the costs of the proceedings to the successful party without attempting to differentiate between those particular issues on which it was successful and those on which it failed: Waters v PC Henderson (Australia) Pty Ltd [(1994) 254 ALR 328].

● In relation to trials it has been said that it may be appropriate to deprive a successful party of costs or a portion of the costs if the matters upon which that party was unsuccessful took up a significant part of the trial, either by way of evidence or argument*: Sabah* Yazgi v Permanent Custodians Limited (No 2) [2007] NSWCA 306 at [24]. A similar approach is adopted on appeal.

● If the appellant loses on a separate issue argued on the appeal which has increased the time taken in hearing the appeal, then a special order for costs may be appropriate which deprives the appellant of the costs of that issue: Sydney City Council v Geftlick (No 2) [2006] NSWCA 374 at [27].

● Whether an order contrary to the general rule that costs follow the event should be made depends on the circumstances of the case viewed against the wide discretionary powers of the court, which powers should be liberally construed: New South Wales v Stanley [2007] NSWCA 330 at [18] per Hislop J (with whom Beazley and Tobias JJA agreed).

● A separable issue can relate to “any disputed question of fact or law” before a court on which a party fails, notwithstanding that they are otherwise successful in terms of the ultimate outcome of the matter: James v Surf Road Nominees Pty Ltd (No 2) [2005] NSWCA 296 at [34].

● Where there is a mixed outcome in proceedings, the question of apportionment is very much a matter of discretion and mathematical precision is illusory. The exercise of the discretion depends upon matters of impression and evaluation: James v Surf Road Nominees Pty Ltd (No 2), citing Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd (1993) 26 IPR 261 at 272.

9. In Ryde Developments Pty Ltd v The Property Investors Alliance Pty Ltd (No 2) [2018] NSWCA 40 at [6]–[7], the Court of Appeal in turn noted that:

“Section 98 of the Civil Procedure Act 2005 (NSW) confers on the Court a wide discretion with respect to costs. Under r 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) the general rule is that the Court is to order that costs follow the event. The “event” may be characterised in more than one way. Generally the “event” refers to the result of the claim or counterclaim, as the case may be, and may be understood as referring to the practical result of a particular claim: Doppstadt Australia Pty Ltd v Lovick & Sons Developments Pty Ltd (No 2) [2014] NSWCA 219 at [15] per Ward, Emmett and Gleeson JJA. Where there has been a mixed outcome in the proceedings, and it is appropriate to entertain the process of apportioning costs as between different issues in the proceedings, in general such an exercise will be carried out on a relatively broad brush basis, and largely as a matter of impression and evaluation by the Court: Doppstadt at [19]; James v Surf Road Nominees Pty Ltd (No 2) [2005] NSWCA 296 at [36]; Fexuto Pty Ltd v Bosnjak Holdings Pty Ltd (No 3) (1998) 30 ACSR 20 at 22.

The relevant principles for the determination of costs on an issue-by-issue basis were stated in [Bostik] at [38] per Beazley, Ipp and Basten JJA:

“Where there are multiple issues in a case the Court generally does not attempt to differentiate between the issues on which a party was successful and those on which it failed. Unless a particular issue or group of issues is clearly dominant or separable it will ordinarily be appropriate to award the costs of the proceedings to the successful party without attempting to differentiate between those particular issues on which it was successful and those on which it failed: Waters v P C Henderson (Aust) Pty Ltd (Court of Appeal, 6 July 1994, unreported).

In relation to trials it has been said that it may be appropriate to deprive a successful party of costs or a portion of the costs if the matters upon which that party was unsuccessful took up a significant part of the trial, either by way of evidence or argument: Sabah Yazgi v Permanent Custodians Ltd (No 2) [2007] NSWCA 306 at [24]. A similar approach is adopted on appeal.

If the appellant loses on a separate issue argued on the appeal which has increased the time taken in hearing the appeal, then a special order for costs may be appropriate which deprives the appellant of the costs of that issue: Sydney City Council v Geftlick & Ors (No 2) [2006] NSWCA 374 at [27].

Whether an order contrary to the general rule that costs follow the event should be made depends on the circumstances of the case viewed against the wide discretionary powers of the court, which powers should be liberally construed: State of New South Wales v Stanley [2007] NSWCA 330 at [18] per Hislop J (with whom Beazley and Tobias JJA agreed).

A separable issue can relate to “any disputed question of fact or law” before a court on which a party fails, notwithstanding that they are otherwise successful in terms of the ultimate outcome of the matter: James v Surf Road Nominees Pty Ltd (No 2) [2005] NSWCA 296 at [34].

Where there is a mixed outcome in proceedings, the question of apportionment is very much a matter of discretion and mathematical precision is illusory. The exercise of the discretion depends upon matters of impression and evaluation: James v Surf Road Nominees Pty Ltd (No 2), citing Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd (1993) 26 IPR 261 at 272.””

10. In Mobis Parts Australia Pty Ltd v XL Insurance Company SE (No 2) [2019] NSWCA 19 at [5], the Court of Appeal noted that:

“There is no issue as to the relevant principles. The discretion under Civil Procedure Act 2005 (NSW), s 98 is ordinarily exercised by requiring that “costs follow the event”: Uniform Civil Procedure Rules 2005 (NSW) (UCPR), r 42.1. This default position was historically understood to mean (so as to preserve the practice, where any issue was tried with a jury, that those costs followed the outcome of that event) “that the costs of the several issues went to the party who succeeded on them respectively, while the general costs went to him who on the whole succeeded on the action” … But more recent authority favours the award of the costs of proceedings to the party successful overall without any differentiation as to issues, at least “unless a particular issue or group of issues is clearly dominant or separable” … And the costs arising from such issues have more readily been apportioned where the party successful overall is the plaintiff ...” [citations omitted]

11. In Croc’s Franchising Pty Ltd v Alamdo Holdings Pty Ltd (No 3) [2023] NSWCA 316 at [7], the Court of Appeal observed:

“… Under r 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) the “general rule” is that the court is to order that costs follow the event. The “event” may be characterised in more than one way. Generally the “event” refers to the result of the claim or counterclaim, as the case may be, and may be understood as referring to the practical result of a particular claim: Doppstadt Australia Pty Ltd v Lovick & Sons Developments Pty Ltd (No 2) [2014] NSWCA 219 at [15] (Ward, Emmett and Gleeson JJA). …”

12. In Chandrasekaran v Western Sydney Local Health District (t/as Westmead Hospital) (No 2) [2024] NSWCA 21, the Court of Appeal summarised the applicable principles as follows at [11]–[12]:

“Costs are in the broad discretion of the Court with the general rule being that they should follow the “event”: Uniform Civil Procedure Rules 2005 (NSW) (UCPR), r 42.1. Generally, the “event” refers to the event of the claim and may be understood as referring to the practical result of a particular claim: Doppstadt Australia Pty Ltd v Lovick & Son Developments Pty Ltd (No 2) [2014] NSWCA 219 at [15] .

Underlying both the general rule that costs follow the event, and the qualifications to that rule, is the idea that costs should be paid in a way that is fair, having regard to what the Court considers to be the responsibility of each party for the incurring of costs: Commonwealth Bank of Australia v Gretton [2008] NSWCA 117 at [121] (Hodgson JA, Mason P and Beazley JA agreeing).”

13. I have here partly drawn on my summary of the applicable principles in Re Carbon Copies Composites Pty Ltd [2023] NSWSC 1039 at [14]ff, to which Mr Bedrossian refers.

The findings in the Primary Judgment

14. I should now turn to the findings which I reached in that judgment which are relevant to the conclusion that I will reach below as to costs. I first dealt with a Cross-Claim brought by several Defendants who contended that there was a binding agreement for Ms Quine to sell her shares in GSPL and units in GSUT and held (Primary Judgment [22]ff) that Cross-Claim should be dismissed, so that the balance of issues in the proceedings were determined on the basis that Ms Quine was at all relevant times a shareholder in GSPL and a unitholder in GSUT.

15. Ms Quine then sought, by way of a derivative claim brought on GSPL’s behalf, a declaration that the Sixth Defendant, Gerringong Commercial Hub Pty Ltd (“GCH”) held a property (“Gerringong Property”) and funds from certain loan funds paid by a third party lender on constructive trust for GSPL. I addressed the question whether the custodian for the lender which had taken security over the land should be joined as party to the proceedings (at Primary Judgment [80]ff) but held that there was no utility in taking that course where that claim would fail for other reasons. I then addressed the question whether a knowing receipt claim had been pleaded by Ms Quine and a constructive trust could be established on that basis and held that that claim failed because Ms Quine had not established fraud or dishonesty to give rise to an exception to indefeasibility under s 42 of the Real Property Act 1900 (NSW). I also held (at Primary Judgment [108]ff) that Ms Quine had not brought a claim in knowing assistance or established that an admitted breach of trust on the part of GSPL had a dishonest or fraudulent character, and the claim for a constructive trust on that basis also failed. Ms Quine also brought a further claim relating to funds advanced by the lender, which I found (at Primary Judgment [116]ff) was not established.

16. Ms Quine also sought equitable compensation for breach of trust in respect of a transfer of the Gerringong Property from GSPL to GCH and I held (at Primary Judgment [121]) that she could not establish that claim on the basis that she had put it, but that an order for compensation should be made in favour of GSPL to the extent that it had suffered loss by reason of an admitted breach of trust in the transfer of that property, either because the relevant consideration was not paid in full or because the property was transferred at undervalue. I addressed both of those issues, including a substantial contest between the parties and the valuation experts they called as to the value of the land. Ms Quine also brought a claim for knowing assistance against two individual Defendants and two companies associated with them. The two individuals conceded that they were jointly and severally liable with GCH for the amount ordered against it, and the claim against the corporate Defendants was not established (Primary Judgment [153]ff).

17. Ms Quine brought claims referable to payments made by GSPL in several categories, although the transactions in issue were narrowed in the course of the hearing. I did not find that Ms Quine established her claim in respect of certain transactions in the first category of that claim (Primary Judgment [163]-[164]); the Defendants conceded liability as to several other categories of transactions, including a claim in respect of payment of legal fees, although the amount recoverable by GSPL in respect of that claim was significantly reduced by a repayment of those fees made by one of the Defendants on the first day of the hearing. Ms Quine also brought, but failed in, a claim for misuse of the premises (Primary Judgment [170]ff). Ms Quine also brought an oppression claim and I found that oppression was established in some, but not all, of the bases put (Primary Judgment [175]ff). It was ultimately common ground that GSPL should be wound up on the just and equitable ground and I made a winding up order up on that basis and appointed a receiver to the assets of GSUT, consequential on the winding up order made in respect of GSPL.

The parties’ costs submissions and determination

18. Ms Quine submits that, notwithstanding the many unsuccessful claims which she had brought, as set out above, several Defendants should pay her costs of the Statement of Claim. She also submits that the Cross-Claim should be dismissed and the several Cross-Claimants should pay her costs of the Cross-Claim. Mr Crossland, who appears for Ms Quine, draws attention to the “usual rule” that costs should follow the event, to which I have referred above, and submits that departure from the usual rule is only justified where the “overall justice of the case” warrants some other order: McCusker v Rutter [2010] NSWCA 318 at [48]. That approach requires an identification of the relevant “event”, where Ms Quine succeeded only in part, after bringing numerous claims as to which she failed. Mr Crossland also submits that, where the Cross-Claim should be dismissed and the Cross-Claimants were unsuccessful in it, costs of the Cross-Claim should follow the event.

19. Mr Crossland submits Ms Quine’s claim had “broadly” three components, namely the oppression claim (as to which, as I noted above, she succeeded in part); a claim for orders addressing GSPL’s transfer of the Gerringong Property to GCH; and a claim for orders for compensation under s 1317H of the Corporations Act 2001 (Cth) for breach of directors’ duties. It seems to me that the identification of the issues in that manner does not adequately reflect the number of claims brought by Ms Quine, which I have noted above, and the fact that several claims within those broader categories did not succeed.

20. Mr Crossland rightly points out Ms Quine’s claim included the oppression claim and the claim for a just and equitable winding up when it was commenced on 5 July 2024 and the Defendants first accepted that the basis for oppression was established in their written opening submissions. That is a matter that plainly tends toward an award of costs in favour of Ms Quine in respect of that aspect of the claim, where she was put to the costs of running that claim, and succeeded in significant parts of it. Mr Crossland then addresses the claim that he characterises as Ms Quine’s “Transfer Claim” in a manner that radically over-simplifies that claim. He rightly recognises that that claim was only brought after it emerged, at a late stage of the preparation of the proceedings for hearing, that the Second and Third Defendants had brought about the transfer of the Gerringong Property by GSPL to GCH, in the circumstances to which I referred in the Primary Judgment at [62]ff. Mr Crossland rightly recognises that Ms Quine succeeded in obtaining substantial relief for the transfer, by way of equitable compensation, although she failed in establishing the larger claim to compensation which she claimed and failed in establishing her claim to a constructive trust over that property or over the loan proceeds, for the reasons that I addressed in the Primary Judgment. I recognise that, as Mr Crossland submits, the large part of the costs relating to the claim for a constructive trust were incurred in two interlocutory applications brought by Ms Quine at the conclusion of the hearing, as to which she accepts she should be ordered to pay costs, although additional costs were also incurred in respect of submissions at the hearing as to that matter.

21. Mr Crossland notes that the compensation recovered by Ms Quine under s 1317H of the Act was $3,351.65 and he accepts that this figure is “de minimis”, although he notes that it would have been larger had one of the Defendants not repaid, on the first day of the hearing, payments that had previously been made by GSPL to the Defendants’ solicitors in payment of legal expenses. Mr Crossland rightly points out that that occurred only at the last possible moment. While I accept that Ms Quine would have achieved a more significant recovery in respect of that issue, that neglects the several other claims as to payments made by GSPL, which were the subject of voluminous evidence, as to which Ms Quine also failed. It does not seem to me that an order that allowed Ms Quine the whole of her costs of the proceedings, without regard to the significant time spent and the costs likely incurred on issues on which she failed, would do justice between the parties.

22. The several Defendants in turn propose an order that the Plaintiff pay their costs of and incidental to Notices of Motion filed by the Plaintiff on 13 and 24 February 2025. It is not necessary to make an order in respect of the motion filed on 13 February 2025, where I have already dismissed that motion with costs on 20 February 2025. I will make that costs order in respect of the second motion, where Ms Quine rightly accepts that she should be ordered to pay the costs of that motion.

23. The several Defendants otherwise contend there should be no order as to the costs of the proceedings with the intent the parties bear their own costs. For the reasons that I set out below, it does not seem to me that that outcome would properly reflect the extent to which Ms Quine has been successful in the proceedings. Mr Bedrossian submits, in support of the application that there be no costs of the proceedings, that there was a mixed degree of success by both Ms Quine and the several Defendants, and, put another way, there were a number of material issues upon which Ms Quine entirely failed. He submits that, if the Court were to make costs orders on the basis that costs follow the event in respect of individual issues, the practical outcome of that process would be that the parties’ costs orders would likely offset each other, although he recognises the costs of a further dispute in a costs assessment. Mr Bedrossian also submits, in a manner that is broadly consistent with my summary of issues above, that:

“The Plaintiff contended that a constructive trust should be declared over the Land in favour of Gerringong Storage (2FASOC, prayer 1D). That claim was entirely unsuccessful.

The Plaintiff contended that the Defendants had made withdrawals or payments contrary to obligations (2FASOC [29D]-[29I]). That claim was pleaded as being for $392,120.63 plus interest (2FASOC [29G]). There were limited portions of that claim upon which the Plaintiff succeeded. In respect of withdrawals for legal expenses, those amounts of $93,332.89 were conceded by the Defendants by their defence filed on 6 December 2024 (Defence 29D and Expenditure Response Document). Beyond those legal expenses, the only success achieved by the Plaintiff was in respect of two additional minor items, totalling $3,351.65. The consequence was that the Plaintiff made good an amount of only $96,684.54 out of her total claim for $392,120.63: Judgment [165] – [167].

The Plaintiff contended that the Defendants had misused the Premises both by allowing the use of the Premises for less than market value and by failing to utilise what was said to be the full income-earning capacity of the entirety of the land (2FASOC [29J]-[29O). That was a claim pleaded as being for $995,243.63 (2FASOC [29O]). That claim was entirely unsuccessful: Judgment [173].

Collectively, the Plaintiff pursued monetary claims totalling approximately $1.4 million, yet succeeded only to the extent of about $96,000 (the bulk of which was then set-off by monetary reimbursements made by the Defendants to Gerringong Storage shortly prior to the final hearing).”

24. Mr Bedrossian is correct in recognising that significant components of Ms Quine’s case were not successful; however, it does not follow that the Defendants should have the costs of those aspects of the case, or that justice would not be done by limiting Ms Quine’s recovery of costs so that it does not extend to the matters on which she failed. Mr Bedrossian also submits that limited time was spent on the Cross-Claim. I do not accept that submission where, rightly, the parties reviewed the relevant correspondence in detail. It also seems to me that Mr Bedrossian’s submission that the costs would here likely offset each other does not have sufficient regard to the extent to which Ms Quine was ultimately successful in obtaining compensation in the proceedings, in respect of the value of the relevant property, or to the extent to which the several Defendants made late concessions as to matters on which she might have otherwise have succeeded, including the breach of trust by QSPL and the Second and Third Defendants’ joint and several liability with QSPL for that breach of trust; and the extent to which damages otherwise recoverable by Ms Quine were reduced, in respect of legal costs, by the late repayment made by one of the Defendants.

25. Mr Bedrossian submits:

“While this might be a case in which the Court could order that costs be apportioned in recognition of partial successes, and partial failures on substantive issues, in all of the circumstances, it would be in the parties’ best interests and consistent with the efficient and cost-effective administration of justice for there not to be a costs order that would likely plunge the parties into extensive costs assessment arguments. The Plaintiff brought a case in respect of which she only achieved partial success. Importantly, there were significant components of the Plaintiff’s claim upon which she entirely failed or substantially failed.”

26. I accept that submission, with the substantial qualification that the outcomes of either Ms Quine’s recovering all her costs or her recovering none of her costs, for which the parties respectively contend, would neither bring about a just result as to costs.

27. In summary, Ms Quine submits that she should recover all of her costs of the proceedings, notwithstanding the significant extent which she has been unsuccessful in the claims that she advanced. The Defendants in turn submit that Ms Quine should recover none of her costs, notwithstanding the significant extent to which she succeeded in aspects of the claim. It is perhaps unsurprising, again given the history of the proceedings, that both positions are unreasonable and I cannot accept either of them. It may be that different parties would have reached agreement that Ms Quine should recover a percentage of the costs of her claim, to minimise the costs of an assessment, but the parties have not here taken that course.

28. I have regard to the principles which I have summarised above, including the questions identified in Monie as to whether the issues on which Ms Quine failed were “dominant” and separable issues. The issues on which Ms Quine failed were plainly substantial, although not necessarily “dominant”, and they were severable from the narrower case on which Ms Quine succeeded. Importantly, I also bear in mind that that the formulation in Monie is not to be approached as though it were a statutory test that confines the judicial discretion that the Court is required to exercise in respect of costs, and later cases have referred to the “significance” of the issues on which a plaintiff failed and emphasised the importance of exercising the discretion to reach a just result in all the circumstances.

29. Here, it seems to me that a possible resolution of the question of costs would have been to order that Ms Quine have the costs of the Cross-Claim and those aspects of her primary claim on which she succeeded, but not of the significant claims on which she failed. On that basis, Ms Quine would recover her costs of and incidental to (1) the Cross-Claim; (2) GSPL’s claim for compensation against GCH; and (3) the Plaintiff’s oppression claim and her claim for winding up on the just and equitable ground, but not her costs referable to (4) the claim brought on GSPL’s behalf that GCH held the Gerringong Property or loan funds on constructive trust for GSPL; (5) the claims referable to payments made by GSPL other than in respect of legal fees; and (6) the claim for misuse of the Gerringong Property. I will not adopt this approach, where the additional costs of an assessment on that basis would plainly not be in the interests of either party.

30. It seems to me that the Court can here do justice by adopting a broad brush approach to the likely result of an assessment, given its own knowledge of the matters in issue and the extent of the evidence and submissions addressed to them. On that basis, I was inclined to order that (1) Ms Quine pay the costs of the two motions on which she failed; (2) the Second to Fifth Defendants pay two-thirds of Ms Quine’s costs of and incidental to the matters raised by the Statement of Claim; and (3) the Second to Fifth Defendants pay all of Ms Quine’s costs of the Cross-Claim, in each case as agreed or as assessed. I recognise that that approach reflects a global assessment, rather than the more granular approach that would likely be adopted (at substantial cost) in an assessment on an issue by issue basis and is necessarily, in the language of the case law, a matter of impression and evaluation as to which minds might differ.

31. After I formed that view, I allowed the parties an opportunity to make further submissions, by an email sent by my Associated as follows:

“His Honour notes that the parties have not made submissions as to the approach to be adopted if he does not accept Ms Quine’s position that she should have all of her costs (other than as to the two notices of motion on which she failed) or the Second-Fifth Defendants’ position to the contrary. On one view, the parties have had procedural fairness, where it was obvious that the case law (to which Mr Bedrossian refers in submissions) would permit an intermediate result, which the parties had each chosen not to address in each pressing only for their preferred result. His Honour will nonetheless allowed the parties an additional opportunity to be heard as to a possible approach as to costs, in submissions not exceeding three pages in Arial font 12, one and a half spacing, to be sent to me in Word format by no later than 4pm on 2 May 2025.

His Honour invites submissions as to whether the Court can here do justice by adopting a broad brush approach to the likely result of an assessment, given its own knowledge of the matters in issue and the extent of the evidence and submissions addressed to them and, on that basis, order that (1) Ms Quine pay the costs of the two motions on which she failed; (2) the Second to Fifth Defendants pay two-thirds of Ms Quine’s costs of and incidental to the matters raised by the Statement of Claim; and (3) the Second to Fifth Defendants pay all of Ms Quine’s costs of the Cross-Claim, in each case as agreed or as assessed. His Honour recognises that that approach reflects a global assessment of this matter, rather than the more granular approach that would likely be adopted at substantial cost in an assessment on an issue by issue basis and is necessarily, in the language of the case law, a matter of impression and evaluation as to which minds might differ.

His Honour notes that it would, of course, still be open to the parties now to avoid the costs of an assessment that would (on that basis) still need to distinguish between the costs of interlocutory processes as to which costs orders would be made in favour of the Defendants and the costs of the Cross-Claim and the costs of the remainder of the proceedings as to which orders in favour of Ms Quine, by reaching an agreed resolution as to costs on a global basis. That, however, will be a matter for the parties, and is not a result that he can bring about for them.”

32. In further submissions, Mr Crossland reiterates Ms Quine’s primary position that the Defendants should pay all of her costs of the Statement of Claim on the ordinary basis. He acknowledges the Court’s power to apportion costs based on mixed success but submits that the aspects of Ms Quine’s claim on which she failed did not take up a significant part of the trial, either as to evidence or argument. He submits that, if an apportionment should be made, that should occur on the basis that those components of the claim on which she was unsuccessful were not relevantly significant. I do not accept that submission for the reasons set out above. Mr Crossland also submits that Ms Quine obtained monetary relief greater than that for which the Defendants contended, but that does not seem to me to be of relevance to the apportionment of costs between the issues on which she succeeded and the issues on which she failed. Mr Crossland also repeats an earlier submission that Ms Quine’s claim to costs should not be “discounted” by reason of her failure to obtain a declaration of constructive trust. No question of “discounting” her claim to costs arises, where the question here is the extent to which Ms Quine has established that claim. Ms Quine then submitted that, if an apportionment was to be made, the Court should require the several Defendants to pay 85% of and incidental to the matters in Ms Quine’s Statement of Claim. This percentage does not seem to me to reflect the outcome of the proceedings, having regard to the matters which I have addressed above. Ms Quine also addressed, briefly, the position as to an earlier application before Nixon J. That matter was outside the scope of the leave granted for further submissions and I do not have regard to the submissions as to that matter.

33. Mr Bedrossian and Mr Munro in turn repeated that the Defendants’ primary position is that there should be no order as to costs, other than as to the two discrete Notices of Motion upon which Ms Quine failed. The Defendants then submit that the structure of the orders which I had contemplated was “slightly incomplete and thus does not result in a fair or appropriate outcome” and that, if Ms Quine had succeeded on two-thirds of the issues raised by the Statement of Claim, then she had failed on one-third of the issues raised by it, and an order should be made in the several Defendants’ favour as to the matters on which she failed. I have not neglected that possibility, which I addressed above. I accept that, as Mr Bedrossian and Mr Munro point out, there are several cases in which that approach has been adopted. The Defendants submitted that that outcome would have the result that the Second to Sixth Defendants would pay one-third rather than two-thirds of the costs of the Cross-Claim, which is the obvious result of that approach.

34. As I have indicated above, I am not persuaded that that approach will do justice between the parties. It seems to me that the Defendants’ approach should not be adopted, first, because Ms Quine ultimately succeeded in the proceedings, although not all aspects of her claim, and her partial success is sufficiently addressed by allowing her costs only of the parts of the case on which she succeeded; and, second, because the significant changes in the Defendants’ position immediately before and in the course of the hearing, particularly by concessions made at the commencement of the hearing and in submissions during the hearing, undermines the basis of the approach for which they contend.

35. With the benefit of the parties’ further submissions, it seems to me that the proper course is to take the approach that I have set out in paragraph 31 above. As I noted above, it will still be open to the parties now to avoid the costs of an assessment that would still need to distinguish between the costs of interlocutory processes as to which costs orders have been made in favour of the Defendants and the costs of the Cross-Claim, and the costs of the remainder of the proceedings as to which orders in favour of Ms Quine, by reaching an agreed resolution as to costs on a global basis.

Orders

36. I therefore make the following orders:

37. ORDER pursuant to s 461(1)(k) of the Corporations Act 2001 (Cth) that Mr Christopher Darin of Worrells, Suite 2 Level 132, 68 Pitt Street, Sydney, be appointed as liquidator of Gerringong Storage Pty Limited (“GSPL”).

38. ORDER pursuant to s 67 of the Supreme Court Act 1970 (NSW) that Mr Christopher Darin be appointed as receiver of the Gerringong Storage Unit Trust.

39. ORDER that the Sixth Defendant (Gerringong Commercial Hub Pty Limited (“GCH”)), the Second and the Third Defendant be jointly and severally liable to pay GSPL equitable compensation in the sum of $2,053,084.56.

40. ORDER that the Second and Third Defendants pay GSPL compensation pursuant to s 1317H of the Corporations Act 2001 (Cth) in the sum of $3,351,65.

41. ORDER that the Plaintiff’s Second Further Amended Statement of Claim otherwise be dismissed.

42. ORDER that the Cross-Claimants’ Statement of Cross-Claim be dismissed.

43. ORDER that the Plaintiff pay the Second to Fifth Defendants’ costs of and incidental to the Plaintiff’s Notice of Motion filed on 24 February 2025 as agreed or as assessed.

44. ORDER that the Second Defendant/Second Cross-Claimant and the Third Defendant/First Cross-Claimant otherwise pay two-thirds of the Plaintiff/Cross-Defendant’s costs of and incidental to the claims made in the Statement of Claim and all of her costs of the Cross-Claim (in each case excluding any costs dealt with by specific costs orders), as agreed or as assessed.

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