Leading Edge Events Australia Pty Ltd v Kiri Te Kanawa

DECISION : Plaintiff entitled to entry of judgment with interest. Fourth defendant to pay 65% of the plaintiff's costs of proceedings against it. As between the plaintiff and the first defendant, no order as to costs. Plaintiff to pay the second and third defendants' costs. The fourth defendant is to pay directly to the second and third defendants 20% of the costs the plaintiff has been ordered to pay to the second and third defendant.

CATCHWORDS : [COSTS] - Costs ordered against unsuccessful defendant that was successful in defending other claims against it - Orders to avoid double dipping - Whether a Bullock or Sanderson order should be made in respect of costs plaintiff ordered to pay successful defendant - [INTEREST] - Whether plaintiff entitled to interest during periods of alleged substantial delay.

Civil Procedure Act 2005 (NSW) Fair Trading Act 1987 (NSW) LEGISLATION CITED : Legal Profession Act 2004 (NSW) Trade Practices Act 1974 (Cth) Uniform Civil Procedure Rules 2005 (NSW)

Ashmore v Corporation of Lloyd's [1992] 1 WLR 446 Australian Prudential Regulation Authority v Holloway (2000) 35 ACSR 276 Beoco Ltd v Alfa Laval Co Ltd (1995) QB 137 Bullock v London General Omnibus Co [1907] 1 KB 264 Coombes v Roads & Traffic Authority (NSW) (No 2) [2007] NSWCA 70 Cretazzo v Lombardi [1975] 13 SASR 4 CASES CITED : Dow & Anor v Nguyen (Unreported, Supreme Court of New South Wales, McLelland CJ in Eq, 25 August 1997) Kaines (UK) Ltd v Osterreichische Warrenhandelsgesellschaft Austrowaren Gesellschaft (formerly Handelsgesellschaft mbH) [1993] 2 Lloyd's Rep. 1 Lackersteen v Jones (No 2) (1988) 93 FLR 442 Leading Edge Events Australia Pty Ltd v Kiri Te Kanawa [2007] NSWSC 228 Re Elgindata Ltd (No 2) [1993] 1 All ER 232 Sanderson v Blyth Theatre Company [1903] 2 KB 533 Sved & Anor v Council of the Municipality of Woollahra & Ors (1998) NSW ConvR 56,598 (55-842)

Leading Edge Events Australia Pty Ltd (plaintiff) Kiri Te Kanawa (first defendant) PARTIES : Nick Grace Management Ltd (second defendant) Nick Grace (third defendant) Mittane Ltd (fourth defendant)

RW Evans (plaintiff) COUNSEL : A McGrath (first and fourth defendants) R Cobden SC (second and third defendants)

Vizzone Ruggero & Associates (plaintiff) SOLICITORS : Henry Davis York (first and fourth defendants) TressCox (second and third defendants)

• 1 - IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION COMMERCIAL LIST

50161/05 LEADING EDGE EVENTS AUSTRALIA PTY LIMITED v KIRI TE KANAWA & ORS (No. 2) JUDGMENT 1 There are competing claims for costs of these proceedings, the judgment in which was delivered on 21 March 2007: Leading Edge Events Australia Pty Ltd v Kiri Te Kanawa [2007] NSWSC 228 (the Judgment). There is also an issue in relation to the award of interest on the judgment amount. The plaintiff was successful in its claim against Mittane Limited (Mittane) for wasted expenditure on a quantum meruit basis. It failed to establish its contract claim against Mittane and failed in its collateral warranty claims against Dame Kiri Te Kanawa (Dame Kiri). At the end of the trial it abandoned its equitable estoppel claim against Nick Grace Management Limited (NGM) and Nick Grace (Mr Grace) and it failed in its equitable estoppel claims against Mittane and Dame Kiri. It failed to establish its claims under the Trade Practices Act 1974 (Cth) (TPA) against Mittane, NGM and Mr Grace and it failed in its claims under the TPA and the Fair Trading Act 1987 (FTA) against Dame Kiri. 2 The parties filed written submissions in relation to their respective position on costs and interest and oral submissions were made on 16 May 2007 when Mr RW Evans appeared for the plaintiff, Mr AS McGrath appeared for Dame Kiri and Mittane and Mr R Cobden SC appeared for NGM and Mr Grace. Principles 3 Section 98(1)(a) of the Civil Procedure Act 2005 (CPA) provides that subject to the Rules of Court, the CPA and any other Act, costs are in the discretion of the Court. Rule 42.1 of the Uniform Civil Procedure Rules 2005 (UCPR) contains the general rule that "costs 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". The discretion is necessarily broad so that the Court is able to craft orders that best suit the dictates of justice of the particular case.

Costs of case against Mittane 4 The plaintiff submitted that it is entitled to its costs against Mittane having succeeded in obtaining judgment in respect of the wasted expenditure. The plaintiff also submitted that this was a case in which one set of facts was relied upon for the purposes of pursuing several causes of action and that the "whole story had to be told" and that the evidence that was essential to establish the plaintiff's entitlement against Mittane was no less than that adduced at trial. It was submitted that the contract, estoppel, or misleading or deceptive conduct claims "should not be costs of issues because those issues did not materially prolong or add to the cost of the hearing". In this regard, the plaintiff relied upon paragraph 3 of the Judgment which was in the following terms: 3. The plaintiff conceded that it was "difficult" to ascertain the time at which the alleged contract was made in this case (tr 428). It was submitted that such ascertainment was heavily dependent upon a detailed analysis of the communications, both oral and written, between the parties and others during the period June 2003 to April 2004. The majority of that analysis is in any event necessary for the determination of the plaintiff's other claims in estoppel and for misleading or deceptive conduct. In these circumstances it is appropriate to describe the parties and others who were part of or party to those communications and events over that period. 5 In support of its submissions that I should not make separate costs orders in relation to the various and default causes of action, the plaintiff relied upon the following passage of Nourse LJ's judgment in Re Elgindata Ltd (No 2) [1993] 1 All ER 232 at 237: The principles are these: (1) Costs are in the discretion of the court. (2) They should follow the event, except when it appears to the court that in the circumstances of the case some other order should be made. (3) The general rule does not cease to apply simply because the successful party raises issues or makes allegations on which he fails, but where that has caused a significant increase in the length or cost of the proceedings he may be deprived of the whole or a part of his costs. (4) Where the successful party raises issues or makes allegations improperly or unreasonably, the court may not only deprive him of his costs but order him to pay the whole or a part of the unsuccessful party's costs. 6 Reliance was placed on this passage to submit that costs orders should not be made against the plaintiff in respect of its unsuccessful claims because "multiple claims should not be discouraged". It does not seem to me that Re Elgindata is authority for that proposition. That case is quite distinguishable from the present case. In Re Elgindata the cause of action was an oppression suit against the company and the other shareholders holding 56% and 11% respectively of the issued shared capital. The trial judge categorised the various factual claims upon which reliance was placed to establish the one cause of action. In the present case there were several causes of action against different parties. Although it was necessary to review the same facts the plaintiff chose to bring separate actions against different parties. It is a different matter when in an oppression suit a plaintiff may not succeed in establishing numerous events of oppression. I do not see that the passage of the judgment in Re Elgindata supports the proposition that multiple claims should not be discouraged. The Court must review each case on its facts and if it is appropriate to make orders against a party who has brought multiple and unsuccessful claims there is nothing in Re Elgindata that suggests such an outcome would be unreasonable. 7 The plaintiff also relied upon Jacobs J's judgment in Cretazzo v Lombardi (1975) 13 SASR 4 at 16 as follows: But trials occur daily in which the party, who in the end is wholly or substantially successful, nevertheless fails along the way on particular issues of fact or law. The ultimate ends of justice may not be served if a party is dissuaded by the risk of costs from canvassing all issues, however doubtful, which might be material to the decision of the case. There are, of course, many factors affecting the exercise of the discretion as to the costs in each case, including in particular, the severability of the issues, and no two cases are alike. I wish merely to lend no encouragement to any suggestion that a party against whom the judgment goes ought nevertheless to anticipate a favourable exercise of the judicial discretion as to costs in respect of issues upon which he may have succeeded, based merely on his success in those particular issues. 8 Once again Cretazzo v Lombardi was not a case in which separate causes of action were involved. That was a case in which the respondent had agreed to entry of judgment in the appellant's favour but in respect of the question of damages had alleged that the appellant was a malingerer. The appellant had claimed that he was intolerant of noise and suffered a general psychological malaise. The trial judge held that the appellant was consciously exaggerating his symptoms to a very large degree, perhaps almost entirely. The trial judge also concluded that the appellant had not been completely truthful and that he was not disabled from working as a result of neurosis and had been under no disability to work after recovering from the organic effects of the accident in respect of which liability had been admitted. The issues raised by the respondent in that case were issues of fact and/or law in the one cause of action as opposed to separate causes of action. As I have already said in the present case, the plaintiff chose to bring separate causes of action against each of the defendants. 9 Although not essential to the outcome of my decision in this case, I should observe that litigation has changed somewhat since Cretazzo v Lombardi was decided. For instance in Ashmore v Corporation of Lloyd's [1992] 1 WLR 446 at 453 Lord Templeman said: The parties and particularly their legal advisers in any litigation are under a duty to co-operate with the court by chronological, brief and consistent pleadings which define the issues and leave the judge to draw his [or her] own conclusions about the merits when he [or she] hears the case. It is the duty of counsel to assist the judge by simplification and concentration and not to advance a multitude of ingenious arguments in the hope that out of ten bad points the judge will be capable of fashioning a winner. In nearly all cases the correct procedure works perfectly well. But there has been a tendency in some cases for legal advisers, pressed by their clients, to make every point conceivable and inconceivable without judgement or discrimination.

10 At the time Cretazzo v Lombardi was decided there was no requirement in an action for damages for a practitioner to provide a certificate under s 347 of the Legal Profession Act 2004 (previously s 198L Legal Profession Act 1987) certifying that reasonable grounds existed for believing, on the basis of provable facts and a reasonably arguable view of the law, that the claim had reasonable prospects of success. Jacob J's reference to not dissuading parties from canvassing issues "however doubtful" is an approach that seems to me to be no longer tenable. The burden of the cost of litigation has been partially responsible for the introduction of the requirement of the abovementioned certificates and a myriad of other changes including the imposition of duties on parties and legal practitioners in respect of the way in which cases are prepared: s 61 Civil Procedure Act 2005 (NSW). Indeed s 60 of the Civil Procedure Act 2005 provides that the practice and procedure of the Court "should be implemented" with the object of resolving the issues between the parties in such a way that the cost to the parties is "proportionate to the importance and complexity of the subject-matter in dispute". 11 The modern litigation practitioner has a far greater burden of deciding which issues or causes of action should be pursued in a Court. The cost consequences for not only parties but also practitioners is a reality that was not present in 1975 when Jacobs J suggested that parties should not be dissuaded from canvassing doubtful issues. Parties who bring other parties to Court and fail in their causes of actions against those parties should not anticipate a favourable exercise of judicial discretion as to costs unless there is something out of the ordinary that might displace the usual approach of costs following the event. 12 The plaintiff failed in its breach of contract case, its equitable estoppel case and its claim for misleading or deceptive conduct against Mittane. The quantum meruit claim on which it succeeded against Mittane was, as noted in the judgment at [2] and [255], never pleaded. It was submitted on Mittane's behalf that justice dictates that there should be a reduction made in the costs to which the plaintiff is entitled against Mittane to reflect the fact that the plaintiff did not bring forward the case on which it succeeded until the last moment. 13 In Beoco Ltd v Alfa Laval Co Ltd (1995) QB 137 the plaintiff had originally claimed damages for breach of contractual warranty as against the first defendant in respect of a heat exchanger that had been installed at the plaintiff's premises and had subsequently exploded. At the trial, the plaintiff was permitted to make an alternative claim that if the first defendant was not liable for the explosion, the plaintiff was entitled to damages for breach of warranty in respect of the cost of making good the defective equipment and consequential loss of profits. The plaintiff ultimately succeeded on the alternative claim and the first defendant was ordered to pay the plaintiff's costs. The Court of Appeal overturned the trial judge's order and awarded the first defendant its costs of the action to the date of the amendment at the commencement of the trial. Stuart-Smith LJ, with whom Peter Gibson and Balcombe LJJ agreed, said at 154: In my judgment, the judge erred in principle and his order for costs is so manifestly unfair to the first defendant that he cannot have exercised his discretion judicially. As a general rule, where a plaintiff makes a late amendment as here, which substantially alters the case the defendant has to meet and without which the action will fail, the defendant is entitled to the costs of the action down to the date of the amendment. There may, of course, be special reasons why this general rule should not be applied. An example of this is to be found in Kaines ( UK) Ltd v Osterreichische Warrenhandelsgesellschaft (formerly C.G.L Handelsgesellschaft m. b. H) [1993] 2 Loyd's Rep.1, 9, where the Judge was satisfied that, even if the amendment had been made earlier, the action would have been vigorously resisted. The Judge disbelieved the defendant's witnesses and the plaintiff received substantial damages. 14 The example to which Stuart-Smith LJ referred was the decision of Mr Justice Steyn, as his Lordship then was, in Kaines (UK) Ltd v Osterreichische Warrenhandelsgesellschaft Austrowaren Gesellschaft m.b.H (formerly C.G.L Handelsgesellschaft m. b. H) [1993] 2 Lloyd's Rep.1 (the appeal from which was dismissed (except to vary the date from which interest was awarded) by the Court of Appeal (Dillon, Stocker and Bingham LJJ)) in which he said at 9: Then I come to the question of costs. Here what is stressed on behalf of the defendants is that there was an 11th hour amendment which changed the nature of the plaintiffs' case. That is perfectly true. It is also perfectly true that the plaintiffs have been beaten down in respect of the amount recovered considerably. On the other hand, they have recovered very substantial damages and that has been the result of an acceptance of the evidence of their witnesses and the rejection of the evidence of the defendants' witnesses. What is of importance, I think, is that if that amendment had been made at a very much earlier stage, it is clear that this claim would still have been vigorously resisted. In my judgment, there is no reason why in exercise of my discretion I should make any special order for costs. I order that the plaintiffs are entitled to their costs.

15 Mittane does not claim that a costs order of the type made in Beoco Ltd v Alfa Laval Co Ltd is appropriate in the present case, however it was submitted that the fact that the plaintiff succeeded in respect of a cause of action which arose on the eve of the trial, which was never pleaded and without which the plaintiff would otherwise have failed, is supportive of a substantial reduction in the costs to which the plaintiff is entitled against Mittane. 16 Mittane also relied on Australian Prudential Regulation Authority v Holloway (2000) 35 ACSR 276. In that case the Australian Prudential Regulation Authority (APRA) was permitted to amend its claim approximately two months prior to trial. It was only on the basis of the amended claim that APRA succeeded in establishing contraventions against the respondent. Mansfield J said at 290, para [49]: In Monier Ltd v Metal Work Tiling Co of Australia Ltd (No 2) (1987) 43 SASR 588, Jacobs J awarded limited costs to a successful defendant because the ground upon which the defence had succeeded was raised only belatedly at the commencement of the trial. Tingay v Harris [1967] 1 All ER 385 and Cheeseman v Bowaters United Kingdom Paper Mills [1971] 3 All ER 513 provide further illustrations of where the order for costs was influenced by the time of an amendment to the claim which added to the causes of action alleged, or which added to the nature of the damage alleged; in each of those cases the consequence of the amendment was that the plaintiff recovered an amount in excess of a filed offer to submit to judgment but would otherwise have recovered less than the filed offer. They illustrate the need to consider each case on its merits. 17 In dealing with matters that the respondents contended APRA had been unsuccessful upon, including an alleged failure of the respondent to co-operate with APRA in its investigations and an allegation that he had concealed a letter, Mansfield J said at 290, para [51]: In the course of complex litigation, there are many issues which arise and which, in the result, prove to be not very important or which are procedural or evidentiary issues. Almost always, the parties have proper reasons for ventilating those issues and they take a little time to resolve. It would not be useful if the Court, in exercising its discretion as to costs, had to revisit each of those issues and keep a tally of the "wins and losses" on such matters. I do not think justice requires that to be done. In my view, those additional matters referred to by the respondents fall into the category of issues which arise incidentally in the course of the proceedings and which in the present matter do not call for separate consideration on the issue of costs. 18 Mansfield J took a variety of matters into account in reducing the percentage of APRA's costs recoverable from the respondent to 35%. The matters taken into account included the lateness of the amendment and the nature of the amendment.

19 Mittane also relied upon the unreported decision of McLelland CJ in Eq in Dow & Anor v Nguyen, 25 August 1997. In that case the plaintiffs had failed to plead the successful claim until the end of the trial. It was submitted that this resulted in McLelland CJ in Eq making an order that the plaintiffs pay the defendant's cost of two days of the trial and holding that otherwise there should be no order as to costs. It seems to me that the costs questions that were before his Honour in that case were far more complex. There were questions relating to an interlocutory hearing and also relating to the burden that was imposed on the opposing party by reason of inadmissible affidavit evidence and consequential oral evidence through an interpreter, thus lengthening the trial. His Honour adopted a notional approach of dividing up the days of the trial and providing some "offset" to conclude that the plaintiff should pay the defendant's costs of two days of the final hearing on a refresher basis. The facts of that case are quite distinguishable from the present case. 20 The plaintiff's contract claim sought damages by way of loss of profits. It was submitted that Mittane, and for that matter Dame Kiri, incurred significant costs during the proceedings in relation to the unsuccessful claims for loss of profit damages. It was also submitted that those costs arose because of the need to challenge the plaintiff's financial capacity to stage the Concerts and the likelihood of the Concerts generating a profit in which the plaintiff might share. It was submitted that none of that material proved to be necessary because of the plaintiff's failure to prove that a contract had been concluded. Mr McGrath referred to the need to prepare for and cross-examine the various witnesses called by the plaintiff in support of its loss of profits claim, including Damien Joseph Stenmark, Mr Wheatley and Ronald Graham Overs. It was submitted that it was also necessary for Mittane and Dame Kiri to rely upon the affidavit of Mr Bohm and various subpoenaed documents to defend the claim. It was also submitted that these unnecessary costs should be reflected in a reduction in the costs to which the plaintiff is entitled against Mittane. 21 Mr McGrath also claimed that the plaintiff's conduct of the proceedings resulted in the cost of the preparation and the trial being unnecessarily increased. In that regard, reliance was placed upon passages of the Judgment in which adverse comment was made in relation to the approach the plaintiff had adopted: paragraph [20]; [190]; [284] - [285] and [290]. It was submitted that the plaintiff's approach in putting all facts in issue across events and communications spanning one year, combined with the looseness of the plaintiff's case, resulted in the need for extensive affidavits, extensive cross-examination, a nine volume Court Book and an extensive set of closing submissions. It was submitted that all these matters justify a further reduction in the costs the plaintiff is entitled to recover against Mittane. 22 The final factor which was submitted to militate against an award of all the plaintiff's costs against Mittane was that the award of $128,063.21 on the quantum meruit claim was less than 10% of the amount the plaintiff was apparently claiming by way of damages on the other claims in which it failed ($1,376,385.20). It was submitted that the quantum of the plaintiff's successful claim suggests that it should have been more properly brought in the District Court of New South Wales. In all the circumstances Mr McGrath submitted that Mittane should only be ordered to pay 25% of the plaintiff's costs of the proceedings.

23 As I said in the Judgment, all of the material relied upon by the plaintiff in respect of all of its causes of actions had to be considered in relation to each of the causes of action. Although the quantum meruit claim was not pleaded, the plaintiff's opening submissions made clear that the plaintiff was pursuing a claim similar to that in Sabemo Pty Ltd v North Sydney Municipal Council [1977] 2 NSWLR 880. I agree with the submissions that there was difficulty in ascertaining some aspects of the plaintiff's claims, however the plaintiff had always claimed as part of its loss, its expenditure in organising the launch and/or Concerts. During the course of the trial I invited Mr McGrath to tell me how it could be that Mittane could resist paying the plaintiff's expenses for instance, for the helicopter flight for Dame Kiri. Mr McGrath claimed that it was "simply a matter of choice" (tr 297). The position of Mittane exposed by this exchange is indicative of an attitude that I am satisfied would have been present irrespective of whether the plaintiff had amended its claim at some earlier date to include the quantum meruit claim. 24 The resistance by Mittane to admitting that such expenses were its responsibility meant that the plaintiff had to prove a number of things including: (1) the nature of the expenses it incurred; (2) the stage at which such expenses were incurred and the surrounding circumstances in which they were incurred; (3) the communications in respect of the incursion of such expenses; (4) the fact that when the communications occurred in relation to the incursion of such expenses, NGM and/or Mr Grace, with whom the communications occurred were communicating with the authority of Dame Kiri and Mittane; and (5) the expenses were reasonably incurred. It was necessary to review the majority of the evidence in the case for the purposes of determining these matters in the plaintiff's favour. It would be a different matter if Mittane had removed these issues, however it maintained them as issues to the end of the trial. I am also satisfied that if an amendment had been made to the pleadings at an earlier stage, Mittane would not have changed its approach to the matter. 25 It is true that the plaintiff failed in its other causes of action against Mittane. I am satisfied that the authorities relied upon by the plaintiff are distinguishable, because they were dealing with issues, as opposed to separate causes of action. However some aspects of those authorities provide some guidance in the approach to be adopted to the costs of the cases against Mittane. For instance, in Australian Prudential Regulation Authority v Holloway Mansfield J referred to the fact that in complex litigation, a description that it is reasonable to apply to this case, issues will arise incidentally in the course of proceedings that do not call for a separate consideration on the issue of costs. It seems to me that Mr McGrath has dissected the nature of the claims made against Mittane in a very helpful way, however it is important not to lose sight of the very large overlap of issues in all causes of action and the necessity to review all of the evidence for each of them. It is not possible to compartmentalise parts of the evidence for one cause of action and parts of the evidence for others, indeed Mr McGrath did not make submissions that such an approach was warranted. 26 I am satisfied that as between the plaintiff and Mittane, rather than dissecting costs in respect of each cause of action, it is appropriate and just to make an award in the plaintiff's favour and reduce the amount of the plaintiff's costs by a percentage to reflect all cost issues between the plaintiff and Mittane. I am satisfied that in all the circumstances, including Mittane's persistence in denying responsibility for any of the plaintiff's expenses, the percentage by which the plaintiff's costs should be reduced is 20%, thus entitling it to recover 80% of its costs in the cases against Mittane, subject to the order I intend to make in relation to Dame Kiri's costs. Costs of the case against Dame Kiri 27 The plaintiff submitted that Dame Kiri was represented by the same solicitors and counsel and jointly pleaded similar defences with Mittane. It was claimed that the additional costs of Dame Kiri appearing as a defendant over those necessarily incurred by Mittane would not be significant, and if required to be assessed, would be difficult to separate. It was also submitted that had Dame Kiri not been joined as a party by the plaintiff, she would have been a necessary witness for Mittane on its pleadings both in defence to the plaintiff's claim and in support of its cross-claim. 28 The plaintiff made the following written submissions: 8. KTK only attended court for the brief time she was cross-examined, when the cross-claims of both Mittane and herself were on foot.

9. As its employee, KTK would be entitled to claim from Mittane re-imbursement for the costs of attending upon its solicitors and to give evidence and for other out of pocket expenses actually incurred. See also clause 9(b) of her Service Agreement [Court Book vol 3 p 539]. There is no evidence of the terms of any retainer, showing that KTK has incurred, or will incur any liability to pay her own costs.

10. The conduct of KTK, supported by Mittane, in withdrawing her services was the reason for the collapse of negotiations and plaintiff bringing the proceedings. A purpose for incorporating Mittane was to allow KTK to avoid dealing directly with (or becoming contractually liable to) promoters. [Judgment paragraph 13]. There is a real question whether Mittane can satisfy the judgment and costs orders in favour of the plaintiff. It would not be fair to the plaintiff if its subjected to a costs order in favour of KTK, which is secured by bank guarantee, and is unable to recover anything from Mittane. 29 I have already referred to the failed claims made by the plaintiff against Dame Kiri. They included serious claims of breaches of a Federal (TPA) and State (FTA) statute. Dame Kiri had a personal interest and potential liability in relation to all the claims brought against her. The fact that her costs may not be great or additional to those of Mittane, having regard to the joint representation, is really not the issue. The question is whether, in all fairness, Dame Kiri is entitled to an order in her favour for the costs she incurred in meeting the claims brought against her. 30 The position of Dame Kiri is quite distinguishable from those cases relied upon by the plaintiff where successful parties had failed on certain issues. The plaintiff chose to bring claims against Dame Kiri for breach of collateral warranty, equitable estoppel and misleading or deceptive conduct and all of those claims failed. In the ordinary course costs should follow those events. Notwithstanding the fact that it failed to establish its cases against Dame Kiri the plaintiff submitted that the fairest order in the circumstances as between it and Dame Kiri is that there should be no order as to costs. 31 Mr McGrath submitted that I should provide some guidance to the costs assessor by ordering that Dame Kiri's costs are to be assessed at 50% of the costs jointly incurred by Dame Kiri and Mittane. It seems to me that such an order would be unfair to the plaintiff. The fact that Mittane incurred costs in successfully resisting the plaintiff's claims against it has been taken into account in reducing the amount of costs the plaintiff is entitled to recover against Mittane. To make the order sought by Mr McGrath would be to allow the full amount of costs incurred by Mittane and Dame Kiri in the proceedings and then order 50% of those in favour of Dame Kiri. It seems to me that such an approach would allow double dipping and in any event I am not satisfied that 50% is the appropriate proportion for Dame Kiri's costs. 32 I am of the view that having regard to: the joint representation; the significant and pivotal role of Mittane in the proceedings; the complexity of the issues; the overlap to which I have referred; and the necessity for the plaintiff to rely upon all the evidence in relation to all causes of action, a more appropriate percentage to be attributed to Dame Kiri in the total costs of Mittane and Dame Kiri would be 15%. The question is how best to reflect such a proportion in the costs that are to be awarded in this litigation doing justice to each of the parties.

33 As I have said in the Judgment Dame Kiri chose to protect herself by setting up the structure with Mitani and then Mittane and becoming their employee. Although Dame Kiri is an employee, indeed the only employee, of Mittane, the evidence in the case satisfies me that Mittane is supine to its employee's wishes, notwithstanding Mr Green's resistance to such a suggestion. Mr Green gave the following evidence (tr 357): Q. As Dame Kiri is the only employee since that time that's the only item, if I could put it that way, that Mittane has to offer in terms of its business operations? A. Dame Kiri is, if you like, the sole employee and therefore we devote our time to assisting her with her arrangements. Q. And would you agree with me that she is a special employee? A. Of course. Q. And that the management of Mittane would take notice of what her wishes were in relation to what concerts she would or wouldn't perform? A. Of course we would listen to her wishes but she has demonstrated to date that she didn't necessarily want to be involved in all matters financial and she doesn't necessarily want to be involved in matters of contracts. Q. I am putting to you that in matters of whether she performs or not she would have the final say as to whether she was due (sic) to proceed with the financial aspect of such a prospect? A. She would have the final say on artistic matters and content. Q. Only that? A. If we wanted her to perform in Timbuktu and she didn't want to go of course she would (sic) . Q. You wouldn't coerce her into performing in a place or with an audience that she wouldn't wish to? A. We would certainly take into consideration her wishes. Q. Be more than taking into consideration, wouldn't it, Mr Green? A. She has a team around her. She is an opera singer. She doesn't want to be involved in the detail. Q. Your form of standard contract requires you to procure Dame Kiri's performance, didn't it? A. Yes. Q. I suggest to you that before you would enter into negotiations with another party, usually a promoter, you as Mittane would have to satisfy yourself that it was likely that you would procure Dame Kiri's performance? A. Yes, we would have to be satisfied that she was aware of the venue and the location and whether she wants to do it but we would look after all the other matters. 34 It was established in the evidence that Dame Kiri does not sign any contracts nor any side letters. It is her practice to have Mittane and formerly Mitani, contract with the promoter and be responsible to the promoter under that contract. The revenue or income Dame Kiri earns through her performances goes to Mittane and Mittane then pays Dame Kiri. Mittane has no source of income other than from Dame Kiri. To observe that Mittane is supine to Dame Kiri's wishes is not to say that there is no legal distinction between the two parties. Rather the observation is made to highlight the need to reach a fair and just outcome and to avoid circularity and the prospect of double dipping. Any amount that Mittane is ordered to pay the plaintiff is an amount to which Dame Kiri no longer has access. Dame Kiri ultimately receives the benefit of any reduction in the amount Mittane is ordered to pay the plaintiff. 35 I am of the view that the fairest way to deal with Dame Kiri's costs is to reduce the amount of costs the plaintiff is able to recover from Dame Kiri's employer Mittane and to make no order as to costs as between the plaintiff and Dame Kiri. Such an order is not a Sanderson order or a Bullock order, although it may present as having similar outcomes to those orders: Bullock v London General Omnibus Co [1907] 1 KB 264; Sanderson v Blyth Theatre Co [1903] 2 KB 533. 36 There will be a further reduction of 15% in the amount of costs the plaintiff is able to recover against Mittane, thus Mittane will be ordered to pay 65% of the plaintiff's costs of the proceedings. There will be no order as to costs as between the plaintiff and Dame Kiri.

Case against NGM and Mr Grace 37 As I have said above the plaintiff was totally unsuccessful against NGM and Mr Grace. Mr Evans submitted that the denial of agency by Mittane and Dame Kiri and the non-admission of agency by NGM and Mr Grace encouraged the plaintiff to maintain its claims against NGM and Mr Grace and that it is appropriate to make a Bullock or Sanderson order in respect of the costs the plaintiff may be ordered to pay NGM and Mr Grace. In these circumstances it is necessary to review the history of the pleadings in relation to these particular claims.

Procedural history of denials of agency 38 From the outset of the communications between the plaintiff and those representing the defendants, it is clear that the plaintiff was alleging that NGM acted as agent for Dame Kiri. It is apparent that on 11 August 2004, the plaintiff's solicitors wrote to NGM making various claims and NGM passed that letter on to its the solicitors in England, Addleshaw Goddard. Although that letter is not in evidence the response to it from Addleshaw Goddard, dated 24 August 2004, is in evidence and includes the following: We strongly disagree with almost everything in your letter but the purpose of this response is to point out that if your client has any complaint about the Sydney and Melbourne concerts that you refer to, it should be addressed to Mittane Limited, the company entitled to furnish the services of Dame Kiri Te Kanawa - and not to NGM. It is clear from the "subject to contract" correspondence about the possibility of certain 2005 concert appearances that in fact no contract of any type has been concluded; one of the 11 August letter's assertions which we emphatically reject is the assertion that "Kiri Te Kanawa through Grace Management Limited negotiated and agreed on concerts to be performed in Sydney and Melbourne". That is not the case. Not only did NGM not conclude any form of contract (or purport to do so), it had no locus standi or authority to do so either on its own account or in behalf of Dame Kiri Te Kanawa or any third party. MGM is simply a consultant to Mittane Limited. It is not Mittane's director, employee, partner or agent. By July 2003 (at the latest) Frank Williams of your client company was aware that NGM's role was limited to that of consultant to Dame Kiri Te Kanawa's employer company. Although we do not understand how you can seriously suggest that some "subject to contract" correspondence and discussions can be described as an "agreement" (your letter's 5th paragraph) - and we unreservedly reject your letter's claims - we leave it to Mittane Limited and that company's legal representatives to deal with your letter in detail (if they consider that necessary), and confine ourselves to pointing out that NGM is not (and never has been) the agent of any of Dame Kiri Te Kanawa, Mittane Limited or Mitani Limited; nor is Dame Kiri Te Kanawa NGM's "client" (page 1 of your letter, final paragraph) in the sense of having the ability to bind her to any commitment. Our client's role has never been anything other than consultant and it has never had actual, apparent or any form of authority (as agent or otherwise) to bind or otherwise act on behalf of the artist or either of her employer companies. We have passed a copy of your letter of 11 August and this letter to Mittane Limited. 39 The plaintiff commenced proceedings in the Equity Division of this Court by the filing of a Statement of Claim (SOC) on 14 February 2005. At this time the plaintiff was alleging that a contract had been entered into between it and Dame Kiri. There was no allegation of a contract between the plaintiff and Mitani or Mittane. In those circumstances the allegations of agency, at least in respect of the alleged communications that allegedly amounted to a contract, were that NGM and/or Mr Grace acted as agent for Dame Kiri.

40 The SOC claimed that Mr Grace was a "theatrical agent" and that he conducted his "theatrical agency business through NGM" (par 12 & 13). The SOC recited numerous contentions of fact in the period July 2003 to March 2004 and in some of those claims alleged that Mr Grace did certain things "on behalf of" Dame Kiri (par 39-41, 57, 62, 68/70, 72, 73, 75, 79). In one instance it is alleged that NGM did certain things "on behalf of" Dame Kiri (par 76). The SOC pleaded seven causes of action: the first was a claim of equitable estoppel against Dame Kiri; the second was a claim against Dame Kiri for breach of s 42 of the FTA; the third was a breach of contract claim against Dame Kiri; the fourth was a claim in the alternative against NGM for breach of s 52 of the TPA; the fifth was a claim pursuant to s 75B of the TPA against Mr Grace; the sixth was a claim pursuant to s 75B of the TPA against Dame Kiri; and the seventh was an alternative claim against Mittane for a breach of s 52 of the TPA. 41 In paragraph 100 of the SOC the plaintiff claimed that at all material times Mr Grace and/or NGM were Dame Kiri's agents. That agency claim was repeated in the s 42 FTA claim against Dame Kiri. In the fourth cause of action, the s 52 TPA claim against NGM, the plaintiff claimed in paragraph 129 of the SOC that NGM engaged in conduct that was misleading and deceptive in that it represented to the plaintiff that: (a) it was Dame Kiri's agent and that it had the authority to negotiate for, and bind, her; and (b) that Dame Kiri would perform at the Concerts. That pleaded cause of action alleged that NGM purported to negotiate conditions on which Dame Kiri would perform at the Concerts (par 130) and that NGM represented that Dame Kiri would perform at the Concerts (par 131). There is a disconnection between the allegation of misleading or deceptive conduct alleged in paragraph 129 and the representations that were allegedly relied upon, being only those in paragraphs 130 and 131. This appears to be a pleading oversight as it is apparent from paragraph 134 of the SOC that the plaintiff intended to allege that the representation that NGM was Dame Kiri's agent was false. 42 It is apparent that as at 2 August 2005, all the defendants were represented by the one firm of solicitors, TressCox. On that day Mr AW Little, a partner of that firm, filed a Statement on behalf of all defendants pursuant to Practice Note 100 in support of the application to transfer the matter into the Commercial List. That Statement recognized the claim made by the plaintiff in the SOC that NGM and Mr Grace were Dame Kiri's agents. 43 On 12 August 2005 the proceedings were transferred into the Commercial List and the plaintiff was ordered to provide security in the amount of $50,000. By that stage the defendants had not been required to plead to the SOC. On 4 November 2005, the parties consented to orders in which the plaintiff was required to file and serve a Summons and Commercial List Statement. That Summons and Commercial List Statement was filed on 9 November 2005 (the CLS). 44 In the CLS the plaintiff maintained its claims that Mr Grace was a theatrical agent and that he and/or NGM acted as Dame Kiri's agents (C 5; 6). In paragraph B 8 the plaintiff claimed that one of the issues that was likely to arise in the proceedings was: Whether the personal defendants were the servants or agents of the corporate defendants and whether the Second to Fourth Defendants were the agents of The First Defendant. 45 This paragraph is rather ambiguous but a reasonable reading of it suggests that the issues identified within it were: whether Mr Grace was a servant or agent of NGM; whether Dame Kiri was a servant or agent of Mittane; and whether NGM, Mr Grace and Mittane were the agents of Dame Kiri. Having regard to the whole of the CLS I am satisfied that this paragraph was not intended to suggest that there would be an issue: (a) whether Mr Grace was the agent of Mittane; and/or (b) whether Dame Kiri was the agent of NGM. There is no claim or contention in the CLS that NGM and/or Mr Grace acted as Mittane's agent. 46 The solicitors for Dame Kiri and Mittane sought particulars of the allegations in the CLS by letter dated 18 November 2005. Those particulars were provided by the plaintiff's solicitors by letter dated 30 November 2005. Unsurprisingly, having regard to the absence of any claim in the CLS that NGM and/or Mr Grace were the agents of Mittane, there is nothing in that response that suggests such an agency. There is however a claim that Dame Kiri controlled Mittane which was her agent. 47 In their Amended Commercial List Response, Dame Kiri and Mittane claimed that NGM agreed to provide Mitani and subsequently Mittane with Mr Grace's services "to perform services of support and assistance" to Dame Kiri as Mitani's, and subsequently Mittane's, employee in relation to Dame Kiri's duties outside the United Kingdom and the Republic of Ireland. Mittane and Dame Kiri "otherwise" denied the claims of agency (C 5). Paragraph A1 of the Amended Commercial List Response includes the following: The plaintiff alleges that the third defendant and/or the second defendant acted as the first defendant's agent in relation to the conduct described in the plaintiff's claims. The first defendant and the fourth defendant deny any such agency. 48 This was a denial by Mittane and Dame Kiri of the agency alleged between NGM/Mr Grace and Dame Kiri, not a denial of any allegation of agency between NGM/Mr Grace and Mittane. Paragraph B 1 of the Amended Commercial List Response of Dame Kiri and Mittane identified the following issue as one likely to arise in the proceedings: Whether the second defendant or the third defendant were the agents of the first defendant in relation to any of the conduct described in the plaintiff's claims. 49 Prior to filing their joint defence, the solicitors for NGM and Mr Grace sought particulars of the allegations in the plaintiff's CLS by way of letter dated 21 November 2005 (Ex D2/3 1). That letter included the following: The further and better particulars are sought in relation to what we understand to be the only allegations made against our clients, Nick Grace and Nick Grace Management Limited, as principals. Those allegations appear from paragraph 40 of the Commercial List Statement onwards. While the second and third defendants are mentioned earlier in the contentions, that is only in the course of allegations that they acted as agents of other parties sued as principals, or were the vehicle for conveying messages from other parties against whom the allegations (as principals) are made. Naturally, such allegations do not amount to allegations of liability on the part of the second and/or third defendants and will not be pleaded to by them. 50 The plaintiff's solicitors provided the particulars by letter dated 30 November 2005. There is nothing in that letter that suggests that NGM or Mr Grace were acting as agents for Mittane. In the Defence filed by NGM and Mr Grace it was denied that Mr Grace was a theatrical agent (C 4), however the claim that NGM and Mr Grace acted as Dame Kiri's agent was not admitted (C 5), thus putting the plaintiff to proof of the fact of that alleged agency. 51 In the CLS the plaintiff no longer claimed that a contract had been entered into between the plaintiff and Dame Kiri. It claimed that the contract was finalised in December 2003 between the plaintiff and Mitani (C 9) and further that later that month Mittane replaced Mitani as the contracting party by Mitani novating its contractual rights and obligations to Mittane (C 10). The particulars to the alleged agreement between the plaintiff and Mitani included the very broad description of telephone calls between Mr Williams on behalf of the plaintiff and Mr Grace "as agent for" Dame Kiri between July and December 2003. Those particulars also refer to emails and/or letters between the plaintiff and Mr Grace and/or NGM "as agents for" Dame Kiri (C 9). The CLS also provided particulars to the alleged novation agreement which included telephone discussions in December 2003 between Mr Williams on behalf of the plaintiff and Mr Grace "on behalf of" Dame Kiri. The particulars do not allege that NGM or Mr Grace were involved in the telephone calls and/or emails and/or letters, "on behalf" of Mittane. 52 Paragraph C11 of the CLS contains the words "following and in furtherance of the agreement" after which there is a series of contentions that Dame Kiri acted in certain ways by herself and "through her agent" NGM and Mr Grace: in participating in the sponsorship launch; providing her signature; providing material for use in the sponsorship package; approving the sponsorship package; making comments in respect of the draft budgets; informing the plaintiff that she would attend the launch; requesting the plaintiff to make travel arrangements; requesting the plaintiff to provide/organise accommodation for her entourage; requesting the plaintiff to make travel and accommodation arrangements for her companion to attend the launch with her; requesting the plaintiff's directors to attend the Auckland meetings; and requesting the plaintiff to organise and pay for the helicopter transport from Auckland to the Bay of Islands. Although this section of the CLS is headed "Contract Claim", paragraph 13 does not expressly allege a breach but rather claims generally that "by reason of the matters pleaded the Plaintiff suffered loss and damage". The particulars of the loss and damage include the expenses outlaid for the organisation and promotion of the Concerts. There was an alternative claim for loss of opportunity to receive the agreed management fee and the share of the net profits. 53 The second cause of action pleaded in the CLS was a breach of warranty claim. The third was the equitable estoppel claim against each of the defendants; the fourth was a s 42 FTA claim against Dame Kiri; the fifth was a s 52 claim against NGM; the sixth claim was against Mittane for breach of s 52 of the TPA; and the seventh claim was a combined claim against Mr Grace and Dame Kiri pursuant to s 75B of the TPA. The claims in the CLS were not made in the alternative, as had been done in the SOC.

54 Although, as I have said, there was no express claim in the CLS that NGM and/or Mr Grace were Mittane's agent there was a claim that Dame Kiri was the "ultimate controller and beneficiary" of Mittane (C 8). That claim was denied by Dame Kiri and Mittane (C 7) and "not admitted" by NGM and Mr Grace (C 5). Notwithstanding the absence of any claim in the CLS that NGM and/or Mr Grace were the agents of Mittane, it appears that Dame Kiri and Mittane understood that there was a claim that Mittane had acted through its agent NGM and/or Mr Grace. That is apparent from the Cross-Summons and Commercial List Cross-Claim Statement (CCS) in support of the Cross-Summons against NGM and Mr Grace filed on 16 December 2005 in which the following appears: 3. In the Plaintiff's Contentions it is alleged that first cross-claimant (as first defendant) [Dame Kiri] and the second cross-claimant (as fourth defendant) [Mittane] did various things by their agents, alleged to have been the first cross-defendant (as second defendant) [NGM] and the second cross-defendant (as third defendant) [Mr Grace]. The defences of [Dame Kiri] and [Mittane] are contained in their Commercial List Response filed herein. In summary, the plaintiff's allegations are denied, including the allegations of agency.

4. If it be found that [NGM] and/or [Mr Grace] were the agents of either [Dame Kiri] and/or [Mittane] as alleged in the Plaintiff's Contentions (which is denied) then [Dame Kiri] and [Mittane] contend that [NGM] and [Mr Grace] acted in breach of the terms of their agency by acting beyond their authority and/or were negligent in carrying out their duties as agent. 55 The CCS included claims that NGM and Mr Grace were not authorised to enter into any agreement or make any representations on behalf of Dame Kiri, Mitani or Mittane and it was also claimed that in their engagement to act as agent of Dame Kiri or Mittane they were obliged to act with reasonable care and skill in performing their duties as agent on behalf of Dame Kiri and Mittane (C 9 & 10). It was alleged that NGM and Mr Grace breached the terms of their agency whereby Dame Kiri and Mittane suffered loss and damage being the costs of the proceedings and the liability to pay the plaintiff by way of damages and/or costs. 56 NGM's and Mr Grace's Commercial List Response filed on 28 February 2006 to the CCS included a denial that neither Mr Grace nor NGM were engaged to act as an agent for Dame Kiri or Mittane (C 9 & 10). In this pleading NGM and Mr Grace referred to the claims made by the plaintiff in the CLS and made a number of admissions: (1) that Mr Grace, on instructions from Dame Kiri, provided material for use in a sponsorship package to be sent with an invitation to attend a launch to attract sponsors; (2) that Dame Kiri instructed Mr Grace to communicate her approval of certain material for a sponsorship package; (3) that Mr Grace on instructions from Mittane, made written comments in respect of draft budgets; (4) that on instructions from Dame Kiri, Mr Grace conveyed to the plaintiff that Dame Kiri would attend the launch; (5) that Mr Grace conveyed communications from Dame Kiri to the plaintiff; and (6) Dame Kiri instructed Mr Grace to request Mr Williams and Ms Newbury to travel to Auckland, New Zealand for various purposes (C 11(c)). 57 The plaintiff filed its Reply to the Commercial List Response filed by Dame Kiri and Mittane on 18 January 2006. It was in this document that the plaintiff first made clear its claim that NGM and/or Mr Grace were the agents for not only Dame Kiri but also Mittane. The Reply included the following: 1. In answer to paragraphs 5 and 10 (b) [denials of NGM's/Mr Grace's and Mr Gleeson's agency for Dame Kiri] of the Defendants' Contentions set out in the Commercial List Response filed on behalf of the First and Fourth Defendants, the Plaintiff says that the Second and/or the Third Defendant at all material times had apparent or ostensible authority to deal with the Plaintiff as agent(s) of the First and/or Fourth Defendant. 58 One of the particulars in the Reply in support of this claim was as follows: 6. The failure of the First and/or Fourth Defendant to inform the Plaintiff that the second and/or Third Defendant was not her and/or its agent in circumstances where the First and/or Fourth Defendant knew that the Plaintiff had extensive dealings with the Second and/or Third Defendant in relation to the organisation of the Concerts. 59 This paragraph of the document had similarities to the original pleading in paragraph 129 of the SOC in which it was alleged that NGM and/or Mr Grace engaged in misleading or deceptive conduct as outlined above. However there was never any claim made against NGM and/or Mr Grace at trial that they had engaged in misleading or deceptive conduct by holding themselves out as agents of Mittane when they were not agents of Mittane. Like so many other aspects of the plaintiff's approach to this litigation, this paragraph presents a further pleading curiosity amongst others that were noted throughout the trial (tr 26-30; tr 477-479).

60 One of the essential matters for the plaintiff to prove in its case against Mittane was that when it received instructions or communications from NGM and/or Mr Grace such instructions and/or communications had been authorised by Mittane. There was certainly no admission that the incursion of costs was approved by Mittane and/or NGM or Mr Grace on behalf of Mittane. Thus the plaintiff had to prove that the incursion of its expenditure was authorised by Mittane. There was no direct communication with Mittane and the plaintiff had the difficult task of establishing a number of matters to succeed in its quantum meruit claim, including: (1) that the reason Mittane ceased the negotiations were personal to it and/or Dame Kiri, its employee; (2) that at the time negotiations were ceased there was the assumption that a contract would be entered into between the plaintiff and Mittane; (3) that it had incurred expenses as a result of Mittane's and/or Dame Kiri's requests and/or approval pursuant to the above-mentioned assumption; (4) in circumstances where the requests and/or approval of the expenses occurred by communication between NGM/Mr Grace and the plaintiff, that at the time such communications occurred NGM/Mr Grace were communicating on behalf of Mittane and/or Dame Kiri. Settlement of the cross-claim 61 Mr Cobden cross-examined Dame Kiri in relation to the cross-claim against NGM and Mr Grace. Dame Kiri agreed that she understood that amongst the allegations made by herself and Mittane in the cross-claim was a claim that NGM and Mr Grace had exceeded the terms of their authority to act on her behalf and on behalf of Mitani and Mittane (t 345). Mr Cobden asked Dame Kiri whether she understood that one of the allegations made against Mr Grace and NGM was that if they had acted on her behalf and on behalf of Mitani and Mittane, they had acted negligently in relation to the dealings with the plaintiff in relation to the Concerts (tr 345-346). In response to this question Dame Kiri said that she did not want to use the word "negligent", however Dame Kiri agreed that she understood that she was alleging wrongdoing on the part of Mr Grace and NGM against herself and Mittane (tr 346). This cross-examination occurred just prior to the luncheon adjournment and prior to Mr Cobden putting to Dame Kiri any of the matters contained in NGM's and Mr Grace's admissions in Response to the CCS referred to above. After the luncheon adjournment Mr McGrath announced that Mittane and Dame Kiri had reached agreement with NGM and Mr Grace to discontinue the cross claim. Mr McGrath sought an order granting leave to Mittane and Dame Kiri to discontinue the cross summons against NGM and Mr Grace with no order as to costs. Mr Evans indicated that he did not have "any view" on whether such leave should be granted. Mr Cobden then indicated that NGM and Mr Grace consented to those orders and said (tr 350-351): The consequences will be that I will not cross-examine any of my learned friend's witnesses any longer. I remained here because there is a direct claim against my clients, but my further participation will be confined, of course, to that claim. 62 Mr Evans indicated the following (tr 388): In view of the recent developments involving the cross-claim and cross-defence, we would like the opportunity to consider whether anything arises out of that before we have to cross-examine Mr Grace. 63 The matter was then adjourned to the following hearing day. On that day Mr Evans made no application in respect of the recent development of the settlement of the cross-claim and the plaintiff's case was closed (tr 389). Mr Grace was then called to give evidence (tr 392). Mr Evans cross-examined Mr Grace but did not put to him the matters that had been the subject of admissions in the Response to the CCS (tr 393-425). The Judgment 64 In the section of the Judgment dealing with the plaintiff's claim for expenses, paragraph 266 includes the following: After the cross-claim was abandoned there was no issue that Mr Grace and/or NGM were acting outside their authority and it is clear that Mr Grace and NGM held themselves out to the plaintiff as having authority to deal with the plaintiff on Mittane's behalf, except when Mr Grace expressly stated otherwise. 65 Even though the cross-claim was abandoned, the question of agency was still alive by reason of the claim in the Reply in respect of which there had been no admission. Indeed, although the plaintiff's pleadings lacked clarity, it was clear throughout the trial that Mittane resisted or denied any suggestion that NGM and/or Mr Grace were acting as its agent, in particular in respect of any authorisation of any expenditure by the plaintiff. The question of agency was relevant and important on the question of whether the plaintiff was entitled to recover its expenses because if NGM and/or Mr Grace were not communicating with the plaintiff as the agents for, or with the authority of Mittane or holding themselves out in that regard, the plaintiff's claim against Mittane to recover its expenses may have foundered. 66 In opening the case for the plaintiff, Mr Evans claimed that in at least one respect (the request for Mr Williams and Ms Newbury to attend the Auckland meetings) Mr Grace was acting as agent for both Dame Kiri and Mittane (tr 5). If the plaintiff failed to establish agency or ostensible authority in relation to the claim for expenses, then it could have looked to NGM and/or Mr Grace. However the claims made in the CLS did not include such a claim. That is understandable because the quantum meruit claim made by the plaintiff upon which it was successful, was not pleaded. Mr Cobden accepted that Mr Evans had included an outline of a claim for wasted expenditure in a document handed up at the end of the trial (r 477) I formed the view that there was no prejudice to Mittane by reason of the absence of a claim from the pleading as expressed in the following passage from paragraph 255 of the Judgment: I indicated to Mr McGrath in final submissions that although the particular claim was not expressly pleaded, it appeared to me that the plaintiff had made such a claim in seeking reimbursement for reasonable expenses incurred, and that it did not appear to me that there was any surprise or prejudice to the defendants. In those circumstances, Mr McGrath then made submissions in relation to the quantum meruit claim and the plaintiff's reliance on Sabemo . 67 Although not expressly stated in the Judgment, one of the reasons that I reached that conclusion was because from the outset of the proceedings, the claim for recovery of expenses had been included in the pleadings, albeit within a contract claim, and the claim for recovery of expenses had also been included in the plaintiff's outline of submissions that were served prior to trial. 68 The misleading or deceptive conduct claims against NGM and Mr Grace were dealt with in paragraphs 292 to 296 of the Judgment as follows: 292 The plaintiff claims that NGM breached s 52 of the TPA by representing to the plaintiff that Dame Kiri "would perform at the Concerts". Mr Cobden submitted that if there is a representation at all to be extracted from the "great morass" of emails and conversations as pleaded over the eight month period, then it could only be along the lines of a representation that "if agreement on all other issues is reached, these are suitable dates, and a suitable fee, for Dame Kiri to perform". It was submitted that such a representation was never made untrue until the withdrawal from negotiations. I agree with these submissions. 293 The plaintiff claimed that NGM had a duty to advise the plaintiff that Dame Kiri was making "negative sounds" about the Concerts and that NGM's silence in this regard was misleading or deceptive. Mr Grace was cross-examined about the email from Mr Gleeson and agreed that he had not disclosed to the plaintiff that Dame Kiri had apparently discussed her negativity about the Concerts with Mr Gleeson. He gave the following evidence in cross-examination (tr 402): Q. Was that because it was for your ears only that you didn't inform? A. I think it is because as Kiri's manager I had heard her concerns because I was with her in Norwich and I was one thousand miles away and Paul Gleeson obviously was hearing the same concerns and I felt it was best that as Kiri was my, I didn't want to discuss things with Kiri over the phone so I thought I would wait and talk to her about her concerns when I got to New Zealand. 294 Even if NGM had a duty to inform the plaintiff that Dame Kiri would not perform at the Concerts, that point had not been reached at the time that Mr Gleeson informed Mr Grace of Dame Kiri's "negative sounds". It must be remembered that this was only six days after Dame Kiri had penned her fax to Mr Grace requesting information about the launch. It is clear that some of her "concerns" had probably been caused by the lack of communication with Mr Grace in the first two weeks of February. The plaintiff has not established that Dame Kiri had decided not to perform at the Concerts prior to 23 March 2004. 295 The plaintiff relied upon NGM/Mr Grace's approval of the artwork for the launch as conduct amounting to a representation that Dame Kiri "would perform" at the Concerts. The plaintiff assumed that a contract would be entered into with Mittane and I have found that this assumption was reasonable. That finding does not amount to a finding that NGM/Mr Grace represented that Dame Kiri "would perform" at the Concerts. There is a distinction between those two positions. Even if the approval of the artwork were to amount to such a representation the plaintiff has the difficulty that it did not rely upon this representation, rather it wanted the side letter so that it did have representation or promise that Dame Kiri would perform at the Concerts. 296 The plaintiff's claim against NGM in respect of a breach of s 52 of the TPA fails. Accordingly the plaintiffs' case against Mr Grace for accessorial liability pursuant to s 75B of the TPA fails. Plaintiff's contentions 69 The submissions made by the plaintiff in respect of the costs of NGM and Mr Grace included the following: 11. The plaintiff's dealings in respect of the concerts had been essentially with NG and NGM, in the belief that they were the duly appointed agents of KTK and Mittane and were duly authorised to deal with the plaintiff in all respects and in all matters relating to the proposed concerts. All causes of actions were dependant upon this agency. If the dealings of NG and NGM with the plaintiff were not as agents of KTK and Mittane, or not within their authority as agents, the case against KTK and Mittane could fail.

12. However, any such unauthorised conduct would be actionable against NG and NGM as misleading or deceptive, as it encouraged the plaintiff to believe that KTK would perform as they were making the arrangements as duly authorised agents.

13. KTK and Mittane, in disputing the agency of NGM/NG, or as agents, acting within their authority, induced the plaintiff to maintain proceedings against NGM/NG to ensure some recovery, in case the claims against KTK and Mittane failed for lack of agency/authority. 70 It was submitted that had Mittane and Dame Kiri and/or NGM and Mr Grace admitted agency, the plaintiff could have elected to proceed only against Dame Kiri and Mittane. It was submitted that the denials of agency and/or authority by Mittane and Dame Kiri induced the plaintiff to maintain its action and in the circumstances it would be just to exercise a discretion to make a Bullock or a Sanderson order in respect of the costs of the failed claims against NGM and Mr Grace. Consideration 71 There does not seem to me to be any basis upon which costs should not follow the event of NGM and Mr Grace successfully defending the cases brought against them by the plaintiff. The only issue in relation to their costs is whether it is fair and just that Mittane be ordered to pay NGM's and/or Mr Grace's costs that the plaintiff is ordered to pay. In other words whether it is appropriate to make a Bullock or Sanderson order. 72 A Bullock order is one in which the unsuccessful defendant is ordered to pay to the plaintiff the costs the plaintiff is ordered to pay to the successful defendant. A Sanderson order is one in which the unsuccessful defendant is ordered to pay directly to the successful defendant those costs that the plaintiff is ordered to pay to the successful defendant: Coombes v Roads & Traffic Authority (NSW) (No 2) [2007] NSWCA 70 at [3] per Beazley JA. 73 In Sanderson v Blyth Theatre Company [1903] 2 KB 533, the original action was brought by the plaintiff, Sanderson, against Blyth Theatre Company, to recover monies for work done and materials supplied in connection with the theatre. The statement of claim alleged that the work was done and the materials were supplied, at the request of the Company by their agent, William Hope (Hope) who was the architect employed in building the theatre. In the defence the Company denied that they or their agent requested the plaintiff to supply the materials or do the work. After the defence was served the plaintiff sought leave to add Hope as a defendant. That leave was granted and the statement of claim was amended to add an alternative claim against Hope for damages in the same amount as claimed against the Company. There was a further alternative claim against Hope for damages for breach of warranty of authority to order the work and materials. The Company put on a defence denying that Hope had the authority to employ the plaintiff. Hope denied that he was the agent of the Company. At the trial, the jury found a verdict for the plaintiff against the Company. The trial judge. Grantham J, ordered that Hope should recover his costs against the plaintiff and that the plaintiff should recover costs against the Company as well as the taxed costs occasioned by joining Hope, including the costs which the plaintiff was ordered to pay Hope. 74 On appeal Romer LJ said at 538-539: Under the Judicature Act, 1890, s. 5 and order LXV., r.1, the Court has full power over the costs of all parties of such an action; and, in my opinion, it has jurisdiction to order the plaintiff to pay the costs of the defendant against whom the action fails, and to add those costs to his own to be paid by the defendant against whom the action has succeeded, and whose conduct has necessitated the action. … The costs so recovered over by the plaintiff are in no true sense damages, but are ordered to be paid by the unsuccessful defendant, on the ground that in such an action as I am considering those costs have been reasonably and properly incurred by the plaintiff as between him and the last-named defendant. … The modern practice, in order to avoid circuity, has been in such cases, where there has been no jury, to order the unsuccessful defendant to pay directly to the successful defendant his costs. … Of course, in exercising the jurisdiction, a judge should have regard to the circumstances of the case, and be satisfied that it is just that the unsuccessful defendant should, either directly or indirectly have to pay the costs of the successful defendant. 75 In Sved & Anor v Council of the Municipality of Woollahra & Ors, (1998) NSW ConvR 56,598 (55-842), Giles CJ Comm D, as his Honour then was, said at 56-605: It is not sufficient for the making of a Bullock order that it was reasonable for the plaintiff to bring the proceedings against both defendants, although sometimes the condition for making a Bullock order is stated in that way (eg Johnsons Tyne Foundary, Pty Ltd v Maffra Corporation (1948) 77 CLR 544 at 546; Altamura v Victorian Railways Commissioners (1974) VR 33 at 35). One statement of principle is that the order may be made where the costs have been reasonably and properly incurred by the plaintiff as between it and the unsuccessful defendant (eg Johnsons Tyne Foundary Pty Ltd v Maffra Corporation at 572-3; Norwest Refrigeration Services Pty Ltd v Bain Dawes (WA) Pty Ltd (1984) 157 CLR 149 at 163; Gould v Vaggelas (1984) 157 CLR 215 at 247, 229; it has also been said that the conduct of the unsuccessful defendant must have been such as to make it fair to impose some liability on it for the costs of the successful defendant, or that the conduct of the unsuccessful defendant must show that the joinder of the successful defendant was reasonable and proper to ensure a recovery of the damages sought ( Steppke v National Capital Development Commission (1978) ACTR 23 at 30-31; Gould v Vaggelas at 229; Fennell v Supervision & Engineering Services Holdings Pty Ltd (1988) 47 SASR 6 at 7-8, 15; Lackersteen v Jones (No 2) (1988) 93 FLR 442 at 449). The difference in formulations is probably more apparent than real, as reasonableness as between the plaintiff and the unsuccessful defendant will normally be demonstrated by some conduct of the unsuccessful defendant which made it proper that the successful defendant be joined or that the unsuccessful defendant should bear the costs of the successful defendant. Such conduct was found in Lackersteen v Jones (No 2) in the unsuccessful defendant denying the authority of its agent whereby the plaintiff joined the agent who became the successful defendant, and more widely has been found in the unsuccessful defendant telling that the plaintiff in one way or the other that it should look to the successful defendant for its remedy ( Altarmura v Victorian Railways Commissioners; Gould v Vaggelas; Fennell v Supervision & Engineering Services Holdings Pty Ltd ).

76 This passage was referred to with approval in Coombes v Roads & Traffic Authority (NSW)(No 2) at [8] per Beazley JA. In Lackersteen v Jones (No 2) (1988) 93 FLR 442, the plaintiff had sued the third defendant (the employer), alleging it was vicariously liable for the conduct of the first and second defendant (the employees). The plaintiff failed against the third defendant. Asche ACJ analysed a number of cases relevant to the making of a Bullock or Sanderson order and said at 449: From those cases therefore the following principles seem to be established before a judge can make a "Bullock" or "Sanderson" order. 1. It must be seen to have been reasonable and proper for the plaintiff to have sued the successful defendant. 2. The causes of action against two or more defendants need not be the same but they must be substantially connected or dependent the one on the other. 3. While it is essential to find that the plaintiff has acted reasonably and properly that alone is not sufficient. The court must find something in the conduct of the unsuccessful defendant which makes it a proper exercise of discretion. 4. Finally, in considering whether to make such an order, the court should, in the exercise of its discretion balance overall two considerations of policy: the first, that an unnecessary multiplicity of actions should not be forced on litigants, so that a plaintiff who acts reasonably in joining two or more defendants should not be penalised or lose the fruits of his victory in costs on the basis that he should have either elected or taken separate actions; secondly, that an unsuccessful defendant should not have to pay more than one set of costs merely because he is unsuccessful. 77 Was it reasonable and proper to sue NGM and Mr Grace? It is apparent from the evidence that prior to commencing proceedings against NGM and/or Mr Grace the plaintiff had approached those parties with the suggestion that they were in fact acting as agent for Dame Kiri. The letter from NGM's solicitors made clear that it was not going to admit that it was the agent for Dame Kiri. That letter was handed on to Mittane and in the absence of any evidence that Mittane responded to the plaintiff's letter, it is reasonable to conclude that there was a denial or an absence of any admission that NGM and/or Mr Grace were acting as agents for Mittane. 78 The vast majority of communications in relation to the Concerts and the Launch were between the plaintiff and NGM and/or Mr Grace. If it were the case that NGM and/or Mr Grace did not have any authority or ostensible authority to communicate with the plaintiff on behalf of either Dame Kiri or Mittane, then the plaintiff might have been able to recover against those parties for misleading it into believing that they did have such authority. Notwithstanding that the claim in this regard was no longer pressed in the CLS and was converted into a claim that Dame Kiri "would perform at the Concerts", I am satisfied that it was reasonable and proper to bring proceedings against NGM and Mr Grace in the circumstances. 79 Were the causes of action substantially connected to each other? The plaintiff's claim against NGM and Mr Grace was for damages arising out of the alleged misleading or deceptive conduct, being the representation that Dame Kiri would perform at the Concerts. Implicit in the pleaded representation is the claim that when it was made NGM and/or Mr Grace were making the representation as Mittane's and/or Dame Kiri's agent. 80 It is true that the claims against NGM and Mr Grace were not the same as the plaintiff's claims against Mittane for the recovery of its expenses on a quantum meruit basis. However the claims against NGM and Mr Grace for the recovery of its expenditure were interconnected with the claims against Mittane. The communications and events so pivotal to the plaintiff's success against Mittane were the same communications and events relied upon in the case against NGM and Mr Grace. Both were claims for wasted expenditure in respect of the launch and/or the Concerts. I am satisfied that the causes of action were substantially connected to each other.

81 Did Mittane's conduct encourage the plaintiff to maintain its proceedings against NGM and/or Mr Grace? An essential part of the plaintiff's claim against Mittane was the fact that NGM and Mr Grace were agents of or authorised by Mittane to request or approve of the incursion of expenditure by the plaintiff in respect of the launch and/or the Concerts. If Mittane had admitted that NGM and Mr Grace were its agents for the purpose of dealing with the plaintiff in respect of the launch and/or the Concerts, the plaintiff, as was submitted by Mr Evans, could have simply pursued Mittane. 82 The unsuccessful defendant, Mittane, could have admitted that NGM and/or Mr Grace were its agents or were authorised to deal with the plaintiff in respect of the request for the incursion of expenditure or the approval of expenditure at any stage but particularly at the time the cross-claim was discontinued. The pre-pleading letter to the parties and the failure by Mittane to admit agency seems to me to have caused the plaintiff in filing the SOC to include the case against NGM and Mr Grace. That much is clear from paragraph 129 of the SOC. Although the lack of precision in the plaintiff's pleading introduces an element of doubt as to whether the plaintiff would not have sued NGM or Mr Grace had there been an admission of agency, on balance, I am satisfied that Mittane's maintenance of the forensic position in which agency was still in issue was conduct that encouraged the plaintiff to maintain its unsuccessful claims against NGM and Mr Grace.

83 Policy matters: I am conscious of the policy matters referred to by Asche ACJ in Lackersteen v Jones (No 2) and I am satisfied that the first of those, the avoidance of a multiplicity of actions should be taken into account when considering whether to make the order sought. The second policy matter is also of significance. Mittane should not be required to pay more than one set of costs unless its conduct induced the plaintiff to pursue NGM and Mr Grace. 84 Although there is a foundation for the making of a Sanderson order, there are other aspects to this case that need to be considered in deciding whether such an order should be made. The way in which the case was conducted by the plaintiff made it very difficult for the successful defendants to ascertain with precision the nature of the claims bought against them. The history outlined above in which the relevant agency now relied upon was only explicitly spelt out in the Reply is an example of this lack of precision. In closing the plaintiff's case at trial, the plaintiff abandoned the equitable estoppel claim against NGM and Mr Grace. It was submitted that this abandonment demonstrates that the maintenance of the claim was simply quite unreasonable. That is certainly one available inference and I am satisfied that Mittane should not be burdened with the costs of NGM and Mr Grace in defending that aspect of the case. 85 The Court is entitled to craft a Bullock order or a Sanderson order in respect of a proportion or percentage of costs if that is fair and just in all the circumstances. I am of the view that it is appropriate that such an approach be adopted in this case. It is not possible to ascertain that proportion or percentage with any real precision having regard to the fact that all of the evidence was relied upon in respect of all causes of action including the successful cause of action. The judgment in respect of that proportion or percentage is subjective, taking into account the whole circumstances of the trial and the ultimate outcomes including the abandonment of the equitable estoppel case against NGM and Mr Grace. 86 Taking all of those matters into account I am satisfied that Mittane should pay 20% of the costs directly to NGM and Mr Grace that the plaintiff has been ordered to pay those parties.

Costs Orders 87 Mittane is to pay 65% of the plaintiff's costs of the proceedings against it. As between the plaintiff and Dame Kiri, there is no order as to costs. The plaintiff is to pay the costs of NGM and Mr Grace. Mittane is to pay directly to NGM and Mr Grace 20% of the costs the plaintiff has been ordered to pay those parties. Interest 88 The plaintiff claims interest in respect of the amount awarded to it on the quantum meruit claim. The plaintiff claims that interest should be awarded from the date when each of the amounts was paid. The parties have been able to agree on the process of calculation. The only outstanding issue is whether I should exercise my discretion to refuse to allow interest for two allegedly significant periods of delay during the plaintiff's prosecution of the proceedings. Mr McGrath submitted that the plaintiff did nothing to progress the proceedings between 14 February 2005 and 9 November 2005 (the first period) and between 1 August 2006 and 24 October 2006 (the second period). 89 I am not satisfied that I should exercise my discretion against the plaintiff in this regard. The matter was in the general equity list and it appears that there were difficulties in obtaining a hearing date for a motion for security. It was at that juncture that the defendants decided to make application to transfer the matter into the Commercial List and take the benefit of the fast track. There was no significant delay by the plaintiff in the first period. During the second period, the matter was stayed whilst the plaintiff obtained funding/finance to provide the security for costs that had been ordered. I am not satisfied that this was substantial delay. Accordingly the plaintiff is entitled to interest on the amounts it expended from the date such amounts were expended. The parties are to provide a calculation on this basis for the entry of judgment. I will stand the matter down whilst that calculation occurs and enter judgment for the plaintiff in the amounts as calculated together with the costs orders referred to above.

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