Jensen v Pearce

Appellant self-represented MBT Lawyers (Respondent) File Number(s): CA 2012/162190 Decision under appeal Jurisdiction: 9101 Date of Decision: 2012-03-28 00:00:00 Before: Garling DCJ File Number(s): DC 2010/101489

Judgment 1BASTEN JA: The parties to these proceedings were in a domestic relationship for the purposes of the Property (Relationships) Act 1984 (NSW) from February 2002 until August 2006. The respondent, Ms Pearce ("the plaintiff"), commenced proceedings in the District Court at Coffs Harbour seeking an adjustment of their respective interests in property. Mr Jensen ("the defendant"), filed a defence and cross-claim in which he sought, amongst other relief, payment of an occupation fee with respect to a property in this State, in which he had a 97% registered interest, but which had been in the sole occupation of Ms Pearce for some time. 2In the District Court, the plaintiff was largely successful, obtaining a judgment in her favour in a sum of $94,310. On 5 August 2013 this Court set aside that judgment and gave judgment for Mr Jensen in the sum of $13,000: Jensen v Pearce [2013] NSWCA 247. The Court further ordered that each party bear his or her own costs of the appeal. With respect to the trial costs, the Court made the following order: "(5) Direct that the respondent file written submissions, if she so wishes, with respect to the costs of the trial, within 14 days, absent which, order that the plaintiff pay the defendant's costs of the trial." 3On 16 August 2013, the solicitors for the plaintiff provided submissions in support of the proposition that there should be no order as to the costs of the trial of the claim or the cross-claim. 4The Court has received no response from Mr Jensen. However, the first copy of the submissions was received by the Court by email, which included his email address. In the circumstances, the Court may assume that a copy of the submissions has been made available to Mr Jensen, but that he does not wish to respond. 5The plaintiff's submissions make a number of factual assertions, which are not supported by an affidavit. However, there is other material before the Court which supports the assertions. One matter relied on may be disposed of immediately. The submission asserted that if the plaintiff were required to pay costs of the trial, she would "incur further significant expense" and be required "to deal with the appellant for the purposes of ascertaining those costs": submissions, par 4. These are not reasons for not making an order, if it were otherwise appropriate. It is not unusual that parties to litigation wish to have no personal contact with each other. 6The plaintiff accepts that costs will ordinarily follow the event: that is, that the unsuccessful party will pay the legal costs, appropriately assessed, of the successful party in the absence of reason for a contrary order: Civil Procedure Act 2005 (NSW), s 98 and Uniform Civil Procedure Rules 2005 (NSW), rr 42.1 and 42.2. She says the Court should otherwise order for the following reasons: (a) she, as plaintiff, was anxious to achieve a resolution of her claim without resorting to litigation but was unable to do so (submissions, par 5); (b) service was impeded by the failure of the defendant's solicitor to accept service (pars 5 and 6); (c) the defendant had three sets of solicitors and ultimately represented himself at trial (pars 7 and 8); (d) the defendant refused to allow his assets in Sweden to be valued for the purpose of the claim against him (par 7); (e) the defendant made submissions in the District Court (repeated in this Court), without substance, challenging the jurisdiction of the Court on constitutional grounds (par 9), and (f) because the defendant was unrepresented, "the plaintiff had no alternative but to proceed to a formal hearing of the claim in the District Court" (par 10). 7Of the matters (a)-(e) set out above, three - (a), (b) and (f) - are without substance. Three others are of potential significance. First, the fact that the appellant had three sets of representation and was ultimately unrepresented - (c) - may well have increased the costs which he was required to pay because of the need for the second and third solicitors to take instructions and assess the state of the proceedings. To the extent that additional costs were incurred, over and above those which would have been incurred by the first solicitor on a continuing retainer, those costs would not be recoverable on an assessment. However, the Court does not decline to order costs because the party in whose favour an order is made may seek to recover more costs than will be permitted under the rules. Further, whilst the plaintiff's costs may have been increased by the fact that the defendant was acting for himself at trial, the costs recoverable by the defendant whilst appearing in person will be limited to disbursements and witness' expenses (if any), reasonably incurred: see Cachia v Hanes [1994] HCA 14; 179 CLR 403 at 410. 8Secondly, to the extent that the preparation for the trial was unreasonably impeded, it may be appropriate to take account of the additional expenses incurred by the plaintiff as a result of such conduct. However, the only conduct which would appear to qualify in that regard was the refusal to "allow assets in Sweden to be valued" - (d). It is said that the defendant claimed that their value was not relevant to the proceedings. Given the absence of any clear evidence of direct contribution by the plaintiff to the acquisition, conservation or improvement of such property, the response may not have been unreasonable. More importantly, absent a clear basis for demonstrating a relevant increase in value (there being no suggestion that the plaintiff contributed to their acquisition), the relative cost of obtaining valuations when compared with the likely benefit was a significant factor in determining the reasonableness of the refusal of the defendant to allow the assets to be valued. It is not clear what steps were proposed with respect to valuation, nor whether the plaintiff proposed to accept responsibility for the costs of obtaining such valuations. In these circumstances, it is not appropriate to adjust the costs order on this basis. 9Thirdly, there were the costs involved in what may fairly be described as legally untenable challenges to the jurisdiction of the District Court - (e). As the Court pointed out in its principal judgment on the appeal, there had been a real difficulty with the jurisdiction conferred on the Court following the transfer of legislative power to the Commonwealth: at [13]. If some such issue underlay the defendant's objections, it was never revealed. The arguments actually run were properly characterised as untenable. However, there is no evidence before this Court as to the amount of time taken up at the trial by this issue. There was no transcript of the trial. However, it appears to have been completed in one day. (Neither party placed a proper chronology before this Court.) 10This matter, though potentially relevant, should not result in a different order as to costs in the present circumstances for the following reasons. First, the defendant will not be able to recover the costs of the time taken at trial, because he was not represented. Secondly, the point being obviously without merit, it is unlikely to have increased the plaintiff's costs significantly. Thirdly, the defendant had significant success on his cross-claim (in relation to the occupation fee) but did not obtain an order for costs on the cross-claim. This Court does not propose to interfere with the conclusion of the trial judge in that respect. The absence of an order with respect to the costs of the cross-claim may therefore be treated as a form of set-off against the defendant's failure with respect to the jurisdictional challenge to the claim. 11There were other issues raised. For example, it was said that there had been "no formal responses to offers of compromise" (par 10). As the offers are not relied upon, that is a matter of no consequence. It was also said that costs were incurred in preparing appeal books "in proper form to assist the Court and the unrepresented party": par 10. That fact was not relevant to the costs of the trial. It was, however, part of the reason why the Court made no order as to the costs of the appeal, a conclusion which is not challenged. 12The plaintiff's submissions with respect to the proposed order as to the costs of the trial should be rejected. The Court, noting that submissions have been made in response to order (5) made on 5 August 2013, should now make the following order: In lieu of the order as to costs made by the District Court on 28 March 2012, order that the plaintiff pay the defendant's costs with respect to her claim under the Property (Relationships) Act. 13BARRETT JA: For the reasons stated by Basten JA, none of the matters (a) to (f) upon which the plaintiff relies warrants an order displacing the result specified in rule 42.1 of the Uniform Civil Procedure Rules 2005. This Court should therefore make, with respect to the costs at first instance, the order that Basten JA proposes. 14EMMETT JA: I have read the reasons of Basten JA in draft form. I agree with the order proposed by his Honour for the reasons given by him.