Kekatos Lawyers Pty Ltd v Rahme

Supreme Court of NSW|2023-04-20|Before: Schmidt AJ

The application to recall the first judgment must be refused

On the submissions advanced for Mrs Rahme there were errors in paragraphs [4] and [5] of the first judgment, which had fundamentally infected the reasoning which followed. In the result it had to be recalled so that judgment could be given in her favour, there being a duty to correct error before final orders were made, when a judgment had miscarried and without fault of the applicant, he or she had not been heard: Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300; [1993] HCA 6. That was claimed to be supported by s 169 of the Legal Profession Uniform Law (NSW) and ss 56-58 of the Civil Procedure Act 2005 (NSW).
That was disputed. Kekatos' case being that there had been no error and that the Court was functus officio, but for costs, there having been no application for leave to reopen the appeal: Roach v R [2019] NSWCCA 160.
I am satisfied that the judgment cannot be recalled, nor orders made in favour of Mrs Rahme on the appeal.
At [4] of the first judgment I observed: "But Mrs Rahme's case was, nevertheless, that Kekatos had been statute barred from bringing the Local Court proceedings and so no question of abuse of process on her part could arise for consideration. To the contrary, Kekatos bringing the Local Court proceedings had involved an abuse. In the Local Court, a motion seeking to have the proceedings struck out as an abuse of process had thus been correctly dismissed and Kekatos' claim heard on its merits."
No doubt I could have more clearly expressed myself when describing the parties' respective cases in the Local Court when I said that Mrs Rahme's case included that "a motion seeking to have the proceedings struck out as an abuse of process had thus been correctly dismissed and Kekatos' claim heard on its merits". That is because the motion had sought to have her defence struck out.
But there was no issue between the parties about the cases which they had respectively advanced in the Local Court in relation to Kekatos' strike out motion, or that it had been dismissed, having been successfully resisted by Mrs Rahme. The result was that Kekatos' claim was heard on the merits by the Local Court and as also explained in the first judgment, dismissed because Mrs Rahme's evidence about the disputed costs was preferred over that of Mr Kekatos.

Should there be a departure from the usual costs order?

There was no issue about the Court's power to make the orders sought by Kekatos.
A departure from the usual costs order under the Uniform Civil Procedure Rules 2005 (NSW), in favour of the successful party on a party/party basis, will be made when there has been relevant misconduct in the proceedings: Oschlack v Richmond River Council (1998) 195 CLR 72; [1998] HCA 11.
Kekatos contended that given the course which Mrs Rahme had pursued, her case in the Local Court having involved an abuse of process as it did, which she defended unsuccessfully on the appeal, a departure from the usual costs order was warranted, she having pursued frivolous and unjustified defences: Baillieu Knight Frank (NSW) Pty Ltd v Ted Manny Real Estate Pty Ltd (1992) 30 NSWLR 359 at 362B.
The arguments advanced in favour of having the judgment recalled were also submitted to be plainly wrong, amounting to no more than a disagreement with the Court's conclusions about the parties' cases on the appeal, as well as an impermissible elaboration of the reasons for that disagreement.
Given the conclusions which I reached about the abuse of process Mrs Rahme pursued successfully in the Local Court and unsuccessfully defended on this appeal, I am satisfied that justice does require that there be an indemnity costs order made in Kekatos' favour. Nothing advanced for Mrs Rahme provides a basis on which the contrary view can justly rest.

Orders

For these reasons I order that: 1. Appeal allowed. 2. The application to recall the judgment is refused. 3. Mrs Rahme pay Kekatos Lawyers: 1. $35,009.50; 2. $3,916 (being $3,298 for filing fee of the Summons and $618 for the Statement of Claim); 3. $13,228.96 (pre-judgment interest); 4. its costs at first instance and on the appeal on an indemnity cost basis; and 5. post-judgment interest in accordance with s 101 of the Civil Procedure Act.

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. Decision last updated: 16 June 2023

JUDGMENT

In Kekatos Lawyers Pty Ltd v Rahme [2023] NSWSC 528 I concluded that judgment had to be entered for Kekatos in relation to its appeal from a judgment of the Local Court given orally on 29 March 2022, dismissing its claim for payment of outstanding legal costs of some $35,009.50, that having resulted from an impermissible abuse of process, given an earlier conflicting judgment given by the Court of Appeal about the same costs.
Left outstanding was the question of the orders to be made to reflect the conclusions reached and costs.
Kekatos sought an indemnity costs order and Mrs Rahme, that the judgment be recalled and set aside with orders made in her favour on the appeal.

At a glance

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Judgment (4 paragraphs)

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Legislation Cited (3)

Cases Cited (8)

Cited By (1)