Kitanovski v Ibrahim

Judgment

1. I delivered judgment in this matter on 14 September 2022 (see Kitanovski v Ibrahim [2022] NSWSC 1232). In accordance with the Amended Summons filed on 13 August 2021, the Court made an order for specific performance of a contract for the sale of land entered into between the plaintiff (Ms Kitanovski) as purchaser and the second defendant (Ms Lahood) as vendor. The Court also ordered the first defendant (Mr Ibrahim) and the third defendant (the Commissioner of Taxation) to remove their respective caveats over the property, on the condition that Ms Kitanovski pay into Court the sum of $700,000 (being the difference between the contract price and the true value of the land) as a form of alternative security.
2. The only matter still to be determined is who should bear the costs of the proceedings. At [55] of the primary judgment, I indicated that my preliminary view on the matter was that Ms Lahood ought to pay Ms Kitanovski's costs of the specific performance claim, but that Ms Kitanovski should pay Mr Ibrahim's and the Commissioner's costs of the proceedings insofar as they related to Ms Kitanovski's attempts to have their caveats removed pursuant to section 74MA of the Real Property Act 1900 (NSW). This preliminary view was buttressed, but not entirely formed, by the fact that counsel for Ms Kitanovski only proffered the condition ultimately imposed on the removal of the caveats during his closing submissions in reply.
3. The parties have since provided written submissions to the Court either in opposition to, or in support of, the Court's preliminary view as to costs. Having considered those submissions, and for the reasons I now provide, I am remain of the view that Ms Lahood should pay Ms Kitanovski's costs incurred in relation to the specific performance claim, and that Ms Kitanovski should pay Mr Ibrahim's and the Commissioner's costs incurred in relation to the section 74MA claims.
4. Ms Kitanovski endorsed the position that Ms Lahood ought to pay her costs of the specific performance claim. Ms Kitanovski submitted that, as between herself and the first and third defendants, Ms Lahood should also be ordered to pay Mr Ibrahim's and the Commissioner of Taxation's costs incurred in relation to the section 74MA claims. Ms Kitanovski submitted that Ms Lahood's conduct relevantly invited or encouraged Ms Kitanovski's claims, including as against Mr Ibrahim and the Commissioner, so as to bring into play the principles espoused by the High Court in cases such as Oshlack v Richmond River Council (1998) 193 CLR 72 at 97-8 per McHugh J, and Northern Territory v Sangare (2019) 265 CLR 164; [2019] HCA 25 at [25] per Kiefel CJ, Bell, Gageler, Keane and Nettle JJ.