Lithgow State Mine Railway Ltd v City of Greater Lithgow Mining Museum Inc

Correspondence between the parties

1. The circumstances in which GLMM filed the submitting appearance are revealed by the communications that passed between the parties in the months prior to the commencement of proceedings. As noted in the Principal Judgment at [41], the parties fell into dispute following Mr Christison's letter dated 8 August 2018 in which it was stated that GLMM "resolved that [it] would retain ownership of [Lots 10 and Lot 11], and not proceed with the transfer of Lot 10…"
2. By late August 2018, the plaintiffs had retained their present solicitors, Higgins Lawyers. On 27 August 2018, Higgins Lawyers sent a letter to GLMM. The letter alleged that an agreement had been reached with GLMM to transfer Lot 10 to the plaintiffs. The letter referred to an earlier letter dated 1 February 2010 in which GLMM stated that it "will agree" to a subdivision of its land in order to transfer the rail corridor within the land to LSMR. The letter also referred to the board meeting of GLMM on 19 June 2010 (see Principal Judgment at [29]) and the development approval to subdivide the land on 28 February 2011 (see Principal Judgment at [32]). It urged GLMM to "revert to [its] earlier position to agree to transfer Lot 10" failing which it would commence proceedings in the Supreme Court.
3. On 4 October 2018, GLMM sent a letter to Higgins Lawyers (in response to a letter from Higgins Lawyers dated 20 September 2018 which is not in evidence). In that letter, GLMM reaffirmed its "previous statement that no agreement has ever been concluded" between GLMM and the plaintiffs. The letter went on, however, to state that GLMM "may consider transfer of the title of Lot 10" subject to a number of conditions being met. Those conditions required the plaintiffs to undertake certain works in respect of the land, largely at the plaintiffs' cost. The letter also set out some additional "pre-conditions to any proposed transfer" which included entry into a formal agreement regarding management and maintenance of certain level crossings and railways; entry into a guarantee that would allow Lithgow Railway Workshop Pty Ltd to continue conducting its business on Lot 10 (see Principal Judgment at [57]; see also Lithgow State Mine Railway Ltd v City of Greater Lithgow Mining Museum Inc [2019] NSWSC 1131); and entry into a guarantee that the assets transferred to LSMR in good faith in June 2009 (a reference to the Deed of Transfer of Assets, see Principal Judgment at [22]) will continue to be used for community purposes within the City of Lithgow. The letter also stated that GLMM required COC and LSMR to demonstrate their "financial capacity" to meet the aforementioned conditions, and to meet all costs in connection with the transfer of title, including stamp duty. The letter ended with the statement that "unless such financial capacity can be demonstrated there is no purpose in pursuing negotiations further."
4. On 15 October 2018, Higgins Lawyers responded by letter in which it was stated that they were "perplexed" that GLMM continued to assert that no agreement was ever concluded. Higgins Lawyers then responded to the various conditions set out by GLMM as pre-conditions for any transfer. The letter enclosed a memorandum of transfer for GLMM to sign and return.
5. In about early November 2018, GLMM retained its present solicitors, Deutsch Miller. On 9 November 2018, Deutsch Miller sent a letter to Higgins Lawyers. The letter noted the allegations contained in Higgins Lawyers' letter dated 27 August 2018 that an agreement existed between LSMR (or COC) and GLMM in respect of Lot 10. The letter invited Higgins Lawyers to provide further details of such allegations, including details as to which of the plaintiffs were party to such agreement; whether the agreement was in writing (in satisfaction of s 54A of the Conveyancing Act 1919 (NSW)); and all other facts, matters and circumstances upon which the plaintiffs relied in support of the agreement.
6. On 20 November 2018, Higgins Lawyers sent a letter in response. The letter provided further details of the plaintiffs' claim, as requested. The letter stated that the agreement was originally between LSMR and GLMM, but that the benefit of the agreement was subsequently assigned to COC in 2009. The letter stated that the minutes of meetings of GLMM's board would confirm the existence of the agreement. The letter also noted that GLMM had consented to the subdivision of its property on 30 September 2010 and consented to a Development Application made in respect of the proposed extensions to the workshop shed on Lot 10 (see Principal Judgment at [34]).
7. On 6 December 2018, Deutsch Miller sent two letters to Higgins Lawyers. The first letter responded to Higgins Lawyers letter of 20 November 2019. The letter identified several problems with the plaintiffs' claim. It noted that the plaintiffs faced "serious difficulties" in establishing the enforceability of the agreement in circumstances where no valuable consideration was provided and the plaintiffs had not furnished evidence of writing in satisfaction of s 54A of the Conveyancing Act or evidence of part performance. The letter questioned the legal basis on which COC claimed to have been assigned the benefit of the alleged agreement. The letter then responded to the particular points advanced in the 20 November 2018 letter. The letter ended by stating that the plaintiffs' claims were "manifestly hopeless" and that should legal proceedings be commenced, they would be defended.
8. The second letter was sent "without prejudice save as to costs". The letter noted that the plaintiffs had a "fundamental misunderstanding" of the requirements for an operative, binding and enforceable agreement, and repeated that the plaintiffs' claim was "manifestly hopeless". Nevertheless, Deutsch Miller invited the plaintiffs and their legal advisors to participate in a without prejudice meeting to be held in February 2019 to discuss and resolve the dispute.
9. Higgins Lawyers accepted Deutsch Miller's invitation. As events turned out, the meeting was held on 7 March 2019. Those attending from the plaintiffs' side included a solicitor from Higgins Lawyers, counsel for the plaintiffs, Mr Wilson and another individual. The defendants were represented by their solicitors and Mr Christison. The meeting lasted approximately three hours. No substantive resolution of the dispute was reached. However, it seems that there was discussion at the meeting about an agreement to take the settlement discussions further.
10. On 12 April 2019, Deutsch Miller sent an email attaching a draft Deed of Understanding and Co-operation. The proposed term of the Deed was 6 months. By its recitals, the draft Deed set out a history of the relationship between the parties and noted that there had been a breakdown in their relationship over the last few years. Certain particular disputes were mentioned, including the transfer of Lot 10, the management of the rail assets and use of those assets, including the workshop, by Lithgow Railway Workshop Pty Ltd. Clause 1 in the Deed addressed the goals and objectives to be achieved during the term of the Deed. It relevantly provided: (a) [GLMM], LSMR and COC are committed to developing a positive and cooperative working relationship. (b) This Deed will provide a framework to rebuild trust between the Parties to, together, manage the Heritage Park in a way which is mutually beneficial for all Parties. … (e) [GLMM] will give consideration to the proposal to transfer Lot 10 to LSMR/COC when, and if, its confidence in the ability of LSMR/COC to manage the relevant site and stakeholders has been restored.
11. Clause 6 was headed "Proposed Transfer of Lot 10". It stated: (a) [GLMM] will undertake a review of all the circumstances, in consultation with LSMR/COC, as well as Lithgow Railway Workshops, six months from the date of this Deed and consider whether the transfer is in the best interests of [GLMM]. (b) In the event that [GLMM] agrees to transfer Lot 10 to LSMR/COC, at least the following conditions would apply to the transfer and must be executed before final settlement: (i) LSMR/COC to ensure Electricity and water supply to Lot 10 to be separated from that of the remainder of the Heritage park. Costs to be met by LSMR/COC; (ii) LSMR/COC to make reasonable efforts to ensure that the carpark (and other outstanding Development Application 056/10DA ("DA") items) are completed and/or resolved in satisfaction of the DA approval. Costs to be met by LSMR/COC; and (ii) Relocation of the designated female toilet block from the Carriage Shed to the former electrical switch room behind the western end of the Bath House. Costs to split evenly between LSMR/COC and [GLMM].
12. The plaintiffs' solicitor deposed that following receipt of Deutsch Miller's email and draft Deed, the plaintiffs were in an "all or nothing" position and not in a position to compromise on the transfer of Lot 10, particularly given the work the plaintiffs had undertaken in the previous nine years whilst relying on the agreement to transfer made in 2009.
13. On 24 April 2019, Higgins Lawyers responded to Deutsch Miller's email. The letter noted that Higgins Lawyers had instructions to commence proceedings in the Supreme Court. It enquired as to whether Deutsch Miller had instructions to accept service.
14. Deutsch Miller responded by sending two letter the same day. The first letter noted that GLMM was "surprised and concerned" that the plaintiffs had given instructions to Higgins Lawyers to commence proceedings. It referred to the earlier letter dated 6 December 2018 which invited the plaintiffs to explain the legal basis of their claim, and stated that there had been no substantive response to that letter. It urged the plaintiffs to provide a response and to take all reasonable steps to resolve the dispute without recourse to the Courts.
15. The second letter was sent "without prejudice save as to costs". The letter noted that Deutsch Miller had not received any response to its email sent on 12 April 2019, nor had it received any suggested amendments to the draft Deed. It noted that the plaintiffs seemed to have answered that email with a threat to commence proceedings without addressing or explaining the factual or legal basis for the relief sought. The letter also noted that GLMM remained willing to negotiate in good faith toward a mutually beneficial outcome, although GLMM could not be reasonably expected to continue to engage in settlement discussions if proceedings were to be commenced by the plaintiffs.
16. The plaintiffs commenced proceedings by filing a Statement of Claim on 1 May 2019.
17. Deutsch Miller sent two letters on 19 May 2019. The first letter noted that Deutsch Miller had previously sent letters on 9 November 2018, 6 December 2018 and 24 April 2019 requesting Higgins Lawyers provide an explanation of the legal and factual basis upon which the plaintiffs contended they were entitled to relief against GLMM, including for the transfer of Lot 10. It was asserted that no explanation was ever provided. It was also noted that there had been no response to the draft Deed prepared in anticipation of continuing settlement negotiations. It was stated that litigation was a last resort and that the plaintiffs up to that point had failed to comply with their duties to take all reasonable steps to avoid litigation. The letter then went on to observe that having reviewed the Statement of Claim, it was defective in substance and form. It noted that the allegation of a "written agreement" was "plainly hopeless", and that the pleadings did not disclose that there was a written and signed agreement as required by ss 23C and 54A of the Conveyancing Act. It also observed that the claim for part performance "is not made out in the pleadings" and to the extent that it is so made out, it is not supported by the evidence. It invited the plaintiffs to file a Notice of Discontinuance.
18. The second letter was sent "without prejudice save as to costs". The letter noted the settlement conference on 7 March 2019 where GLMM apparently acknowledged that the plaintiffs had incurred costs in relation to the subdivision of the land which created Lot 10, and invited the plaintiffs to furnish evidence in support of such costs. The letter contained an offer that GLMM reimburse any costs incurred by the plaintiffs (and not paid by any other third parties) in relation to the subdivision on the basis that the plaintiffs discontinue the proceedings within 7 days and provide itemised invoices and receipts in respect of the costs incurred. This offer was not accepted by the plaintiffs.
19. GLMM filed its submitting appearance in Court on 7 June 2019 when the matter was first listed for directions in the Real Property List.

Submissions

1. The plaintiffs submitted that GLMM should pay the costs of the proceedings, at least on the ordinary basis. It was submitted, by reference to the correspondence passing between the parties, that at no time did GLMM ever genuinely seek to resolve the plaintiffs' claims. The plaintiffs pointed to the repeated assertions by Deutsch Miller that the plaintiffs' claim had no prospects of success.
2. The plaintiffs further submitted that GLMM had been guilty of "relevant delinquency" in the conduct of the proceedings which exposed the plaintiffs to unnecessary legal costs (see Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11 at [44]). This delinquency was said to arise from a combination of factors, namely:

• that Deutsch Miller made repeated assertions that the plaintiffs claim was futile;
• that GLMM was "sitting on its hands" between March 2018 and August 2018;
• the informal settlement conference on 7 March 2019 and the "less than useful" draft Deed that Deutsch Miller prepared a month later;
• GLMM's failure to disclose the existence of a caveat lodged by Lithgow Railway Workshop Pty Ltd; and
• GLMM's failure to disclose the existence of a Deed of Licence dated 15 October 2018 between GLMM and Lithgow Railway Workshop Pty Ltd.

1. It was put that the combination of these factors left the plaintiffs with no alternative but to commence proceedings which, up until the last minute, GLMM's legal advisors insisted would fail. For those reasons, the plaintiffs contend that GLMM should be ordered to pay their costs on an indemnity basis.
2. GLMM's primary contention was that in all the circumstances, including the filing of the submitting appearance on 7 June 2019, the appropriate order was that each party bear their own costs of the proceedings. There were two main considerations underpinning this primary contention. First, GLMM contended that the plaintiffs failed to articulate the factual and legal basis of their claim prior to the commencement of proceedings. GLMM referred to the repeated efforts by its solicitors to understand how the plaintiffs put the claim. It was put that the limited responses to the requests to clarify the position did not enable those standing behind GLMM to assess whether the GLMM was obliged to transfer Lot 10 to either one or both of the plaintiffs, or whether such transfer was in GLMM's best interests. By way of example, GLMM pointed to the fact the plaintiffs did not sufficiently identify whether LSMR or COC was entitled to receive the transfer of Lot 10 in circumstances where GLMM was not aware of having dealt with COC.
3. Second, GLMM pointed to the fact that it made numerous attempts to resolve the issues in dispute both before and after the commencement of proceedings. Particular reference was made to the suggestion by Deutsch Miller of the informal settlement conference to take place in early 2019. GLMM also referred to the draft Deed by which it was proposed that further negotiations would take place in respect of the transfer of Lot 10. GLMM submitted that no comments or suggestions were made in relation to the draft Deed. Instead, the plaintiffs elected to commence proceedings. GLMM also noted that after the proceedings were commenced, it made an offer on 19 May 2019 for the plaintiffs to discontinue the proceedings on the basis that GLMM would reimburse any costs incurred by the plaintiffs in furtherance of the subdivision. GLMM submitted that at no stage did it ever "rule out" a transfer of Lot 10.
4. GLMM's alternative contention was that it should only pay the plaintiffs' costs up to and including 7 June 2019, the date it filed its submitting appearance. In this regard, GLMM primarily relied upon the "presumption" which I have held does not exist. GLMM further submitted that the reason it filed the submitting appearance was that it did not have the financial means to meet an adverse costs order. GLMM also submitted that it did not "compel" the plaintiffs to commence proceedings (cf Commissioner of Taxation v Warner (No 2) (2015) 337 ALR 350). Neither of those matters seems to me to warrant the making of a limitation upon any costs payable by GLMM.
5. GLMM rejected the plaintiffs' contention that it should pay the costs of the proceedings on the indemnity basis. GLMM submitted that it has acted as an exemplary litigant throughout the proceedings. It filed a submitting appearance early in the proceedings and sought to avoid litigation by engaging in settlement negotiations with the plaintiffs. This was said to be in contrast to the plaintiffs' failure to engage in "an agreed settlement procedure" or otherwise seek to resolve the dispute "in a substantive or meaningful way".

Should GLMM pay the plaintiffs' costs of the proceedings?

1. LSMR was successful in obtaining declaratory relief and orders for specific performance against GLMM. This gives rise to an "event" for the purposes of UCPR r 42.1. Accordingly, the default position is that LSMR is entitled to its costs of the proceedings unless it appears to the Court that some different costs order is warranted.
2. In this regard, the Court must consider all the relevant circumstances, including the circumstances in which GLMM filed its submitting appearance.
3. The dispute in this case was concerned with whether there was a binding and enforcement agreement for the transfer of Lot 10. The Court found that an agreement in principle was made in about July 2009 to proceed with a subdivision of GLMM's land so as to create a lot that would be transferred to LSMR, and that by no later than the time when the plan of subdivision was lodged for registration, GLMM became obliged to proceed to transfer Lot 10 to LSMR (Principal Judgment at [47]-[53]).
4. In Kisimul Holdings Pty Ltd v Clear Position Pty Ltd (No 2) (supra), the appellant sought orders setting aside two statutory demands served on it by the respondent. At first instance, the respondent successfully defended the proceedings. However, on appeal, the respondent filed a submitting appearance. The Court of Appeal allowed the appeal and ordered the respondent to pay the appellant's costs of the appeal. The Court of Appeal said (at [15]-[17]). 15. In the present case, the appellant and the respondent were the only parties to the particular litigation. The appellant sued the respondent in the Equity Division and was unsuccessful. It then appealed and met with success. The litigation was not of a kind in which one party played a role akin to that of a tribunal or decision-maker having no vested interest. To the contrary, the respondent, by defending the Equity Division proceedings, strove to obtain the commercial benefit of a presumption of insolvency against the appellant and successfully resisted the appellant's attempt to deny it that benefit. When the appellant later renewed that attempt in this Court, the respondent had at its disposal four possible responses: file an unqualified appearance and oppose the grant of the relief the appellant sought; consent to the grant of that relief; file a submitting appearance; or simply ignore the matter. 16. The stance adopted by the respondent in this Court (the third possibility) did not relieve the appellant of the need to prove its case in this Court. That stance was the same, in that respect, as the fourth possibility. Only if the respondent had consented to the grant of the relief sought would the appellant have been relieved of that need. 17. In the events that happened, it was necessary for the appellant to make all pre-hearing preparations, to brief counsel and to present its case to the Court. It may well be that the lack of active opposition meant that the appellant's task was less onerous than it would otherwise have been. But effort and expenditure were incurred beyond that which would have been necessary had the respondent consented.
5. The Court of Appeal continued (at [19]): In the circumstances of this case, the filing of a submitting appearance by a party occupying a true adversarial position in a commercial dispute and concerned with nothing but its own economic welfare cannot be allowed to operate as some form of insulation from the costs consequences of requiring the appellant's claim to proceed to curial determination rather than cooperating in a consensual resolution of it.
6. In my opinion, similar reasoning applies in the present case. All parties to the proceedings were concerned with advancing their own perceived interests. For the plaintiffs, those interests included seeking orders in the nature of specific performance of the alleged agreement for the transfer of Lot 10. As the correspondence in evidence indicates, GLMM had an interest in resisting the plaintiffs' claim. The decision to file the submitting appearance must be understood in that context. The filing of that appearance did not relieve the plaintiffs of the need to prove their cases, even if the task was made less onerous than it otherwise may have been.
7. Further, this is not a case where GLMM was in a position akin to a tribunal or analogous decision-maker, or was not actively involved in the underlying dispute. To the contrary, GLMM's conduct in refusing to transfer Lot 10 to LSMR from August 2018 was the effective cause of the proceedings.
8. In their written submissions, both parties relied heavily on the correspondence passing between them to justify their respective positions. It is true that in none of those communications did Higgins Lawyers fully and completely set out the factual or legal basis for its contention that a binding and enforceable agreement came into existence with GLMM. But I do not think that it is correct that the content of those communications did not enable GLMM to understand the nature or basis of the plaintiffs' claim. The Higgins Lawyers' letter of 20 November 2018 provided details of the essential nature of the claim. It is evident from Deutsch Miller's letter in response of 6 December 2018 that it had enough information to provide a detailed answer in which it identified weaknesses in the plaintiffs' claim, including the factual basis for any concluded agreement and possible defences based on ss 54A or 23C of the Conveyancing Act.
9. The parties engaged in negotiations with a view to resolving the dispute. This included participating in an informal settlement conference in March 2019. The draft Deed of Understanding and Cooperation was apparently prepared by GLMM as a result of discussions which took place at that conference. The terms of the Deed provided a framework for further discussions to take place in respect of the various issues in dispute between the parties (which included the dispute in relation to Lot 10). The plaintiffs chose not to proceed along that path, deciding instead to commence the proceedings. The plaintiffs were entitled to take that course. I do not accept the suggestion that the plaintiffs acted unreasonably in failing to further participate in settlement discussions.
10. At no time during the settlement discussions (whether before or after the commencement of proceedings) did GLMM express a willingness to transfer Lot 10 to LSMR. GLMM essentially maintained that the plaintiffs' claim was hopeless, but suggested that some other agreement to transfer could be reached. For example, in the letter dated 4 October 2018, GLMM asserted that there was no concluded agreement between the parties, but went on to state that it "may consider" transferring the title if a number of conditions could be met by the plaintiffs, who were also required to demonstrate their "financial capacity" to meet such conditions. Deutsch Miller's "without prejudice" letter dated 19 May 2019 (after the commencement of proceedings) asserted that GLMM had no legal obligation to transfer Lot 10. The letter contained an offer to reimburse the plaintiffs for expenses incurred in pursuing the subdivision of GLMM's land, provided the plaintiffs discontinued the proceedings.
11. Although the parties did not refer to this factor in their written submissions, I have also had regard to whether the proceedings were a kind that could be resolved by consent without the need for the plaintiffs to prove their cases (cf Lou v IAG Limited t/as NRMA Insurance (supra)). In their Statement of Claim, the plaintiffs sought declarations and orders in the nature of specific performance. It is not the practice of the Court to make declarations by consent without a hearing on the merits or in the absence of any facts supporting the grant of declaratory relief (see Church of the Foursquare Gospel (Australia) Ltd v New Hope Church Swansea Inc [2019] NSWSC 519 at [14]). It might be said that the nature of such relief did not obviate the need for the plaintiffs to prove their cases in any event, even if a consent position was ultimately reached (see Commissioner of Taxation v Warner (No 2) at [27], citing Trust Co of Australia Ltd v Perpetual Trustees WA Ltd (1995) 36 NSWLR 654 at 660). Furthermore, declarations and orders for specific performance are discretionary remedies. The Court could refuse to grant such relief even if a consent position was reached.
12. In this case, however, I do not think that there was any real obstacle to the grant of such relief by consent. The proposed declaration sought only to clarify the existence of a private agreement between one or other of the plaintiffs and GLMM. It was thus confined to the vindication of private rights (see BMI v Federated Clerks Union of Australia (1983) 51 ALR 401 at 413-4). Moreover, the plaintiffs' claim involved a contract for the sale of land, where orders for specific performance are routinely made on the basis that damages are an inadequate remedy (see Dougan v Ley (1946) 71 CLR 142 at 150).
13. In all the circumstances, I think it is appropriate that GLMM pay LSMR's costs of the proceedings. I do not see any good reason to depart from the usual position that costs follow the event. The same reasoning cannot apply to COC, which was not successful in obtaining relief against GLMM. GLMM should not be ordered to pay COC's costs of the proceedings.
14. I am not persuaded that GLMM should pay LSMR's costs on an indemnity basis. In my opinion, the various matters raised by GLMM, even when considered cumulatively, do not provide any basis for such an award. Deutsch Miller's repeated assertions that the plaintiffs' claim was "manifestly hopeless" were incorrect, but those assertions by themselves are not indicative of any "relevant delinquency" on GLMM's part. I am also not prepared to conclude that GLMM was "sitting on its hands" between March 2018 and August 2018. As the Court identified in the Principal Judgment at [41], there was no evidence of what took place during that period. It is apparent that GLMM took various steps to engage in negotiations with the plaintiffs to avoid the need for litigation. Any proposals that may have arisen from those negotiations, including the draft Deed, may not have met the needs of the plaintiffs, but the correspondence in evidence does not suggest that GLMM was dealing with the plaintiffs in bad faith. The plaintiffs appear to suggest otherwise, however, by submitting that GLMM failed to disclose the existence of the Deed of Licence it had entered into with Lithgow Railway Workshop Pty Ltd as well as the caveat lodged by that entity on the title of Lot 10. However, it seems to me that neither the Deed of Licence nor the caveat were relevant to the central question of whether there was a binding agreement between the plaintiffs and GLMM. I do not think that GLMM's failures to disclose those items were material to the issues with which these proceedings were concerned.
15. Accordingly, the Court will order pursuant to s 98 of the Civil Procedure Act that GLMM pay LSMR's costs of the proceedings on the ordinary basis.

Should the plaintiffs pay GLMM's costs of preparing its written submissions?

1. As noted above, GLMM submitted that the plaintiffs should pay its costs of preparing the written submissions in respect of this application. The essence of the submission is that the preparation of the written submissions may have been avoided if the plaintiffs had made any attempt to engage with GLMM on the question of costs. The basis for the submission is found in the correspondence between the parties following the delivery of the Principal Judgment on 28 October 2019. I will refer to those circumstances briefly.
2. On 28 October 2019, the Court directed the plaintiffs to bring in short minutes of order giving effect to the Principal Judgment within 28 days. The Court suggested in the Principal Judgment (at [57]-[58]) that the plaintiffs consult with Lithgow Railway Workshop Pty Ltd in relation to the mechanics of such orders. The Court also noted that if the plaintiffs sought costs against to GLMM, it would be necessary to give GLMM an opportunity to be heard on the question.
3. On 21 November 2019, Higgins Lawyers sent proposed orders to my Associate. Relevantly, Order 3 in the proposed orders sought indemnity costs against GLMM. Deutsch Miller was copied into the email containing the proposed orders but the content of the email did not suggest that GLMM had any prior notice of that email being sent. Shortly afterwards, Deutsch Miller sent an email to my Associate confirming that it had not seen Higgins Lawyers' email or the proposed orders and was not aware that indemnity costs were being sought against it. Deutsch Miller requested a further two weeks (until 9 December 2019) to consult with the plaintiffs in respect of the costs of the proceedings. The Court acceded to that request.
4. On 27 November 2019, Deutsch Miller sent an email to Higgins Lawyers which comprehensively set out the grounds upon which it relied in its contention that there should be no order as to costs in the proceedings. It also set out the grounds upon which it resisted any claim that GLMM should pay the costs of the proceedings on the indemnity basis. The letter proposed an order that each party pay its own costs in lieu of Order 3 of the plaintiffs' proposed orders, and asked the plaintiffs to confirm whether they consented to such an order. The letter asked for a response by 5:00pm on 3 December 2019.
5. The plaintiffs did not respond by that time. A follow up email was sent on 4 December 2019 requesting that Higgins Lawyers provide a response as soon as possible, noting that the parties were required to provide a response to the Court by 9 December 2019.
6. Higgins Lawyers did not respond to this follow up email. On the morning of 9 December 2019, Deutsch Miller sent a further follow up email which stated that unless Higgins Lawyers responded by 2:00pm that day, they intended to write to my Associate confirming that the parties had not agreed on the issue of costs and proposing a timetable for the filing and service of written submissions addressing the issue.
7. Higgins Lawyers did not respond by 2:00pm that day (it seems that Higgins Lawyers' office was closed that day). Deutsch Miller sent an email to Higgins Lawyers at around 5:30pm that day which proposed a joint communication to be sent to my Associate and requested that Higgins Lawyers respond by 12:00pm the following day.
8. On 10 December 2019, Higgins Lawyers responded. The letter noted that the terms of the proposed communication was "consistent with our suggestion contained in our letter 5 December 2019", and expressed no objection to Deutsch Miller sending the communication to my Associate (save for some minor amendments). The reference to a letter being sent on 5 December 2019 is not clear; no such letter is in evidence, nor is there any further reference to it.
9. Later that same day, Deutsch Miller responded by email. It relevantly noted that Higgins Lawyers had failed to provide a detailed explanation of their position on costs, nor had they responded or confirmed the plaintiffs' position in relation to Deutsch Miller's email sent on 27 November 2019.
10. By reference to the above state of affairs, GLMM submits that the plaintiffs had failed to engage in negotiations with GLMM in respect of costs, and that the need to prepare written submissions in this application may have been avoided if it chose to so engage.
11. I do not accept that the plaintiffs should pay GLMM's costs of its written submissions. The submissions were required because the parties could not agree on the appropriate order for costs. It may be that further discussions could have led to an agreement, but this is really a matter of speculation. The fact remains that GLMM at no stage accepted that it should pay the costs of the successful plaintiff. It made no offer to that effect.

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