Maisano v Bodycorp Repairers Pty Ltd

Supreme Court of Victoria|2015-07-24|Before: ELLIOTT J

PRACTICE AND PROCEDURE - Application for substitution of plaintiff - Existing plaintiff seeking to continue - Applicant's equitable right with respect to costs judgment - Means of protecting all parties' interests - Joinder of applicant as a defendant - Applicable legal principles - Supreme Court (General Civil Procedure) Rules 2005 (Vic), r 9.06(b)(ii).

1 The applicant, the law firm Oakley Thompson & Co Pty Ltd ("Oakley Thompson"), brought an action in proceeding no S CI 2014 05814 ("the Related Proceeding") in order to pursue a taxation of costs for a former client, Anunziato Enzo Maisano ("Maisano"). On the understanding that Maisano did not wish to pursue the taxation of costs in this proceeding, Oakley Thompson sought to do so either on Maisano's behalf or in its own right.

2 Oakley Thompson was largely successful. In the Related Proceeding, in finding that Oakley Thompson has an equitable interest in the costs judgment in an earlier proceeding[1] and, also, that it is entitled to pursue the taxation of costs,[2] the court granted declaratory relief reflecting this position.[3] However, it was also found that Oakley Thompson was not entitled to pursue the taxation of costs on Maisano's behalf, as to do so would be against Maisano's wishes and contrary to his instructions.[4]

3 Relying on the final judgment in the Related Proceeding, Oakley Thompson filed a summons seeking relief in this proceeding. The application primarily sought to substitute Oakley Thompson for Maisano as the plaintiff in this proceeding with the stated intention of pursuing the taxation of costs in its own name against the existing defendant, Bodycorp Repairers Pty Ltd ("Bodycorp").

4 At the hearing of this application, Maisano stated, for the first time in either the Related Proceeding or this proceeding, that he intended to prosecute the taxation of costs on his own behalf. This change of position is perfectly understandable given Maisano was unsuccessful in establishing Oakley Thompson's costs were capped, and therefore was unsuccessful in proving that Oakley Thompson had been paid by him in full.

5 For the reasons set out below, I do not propose to order that Oakley Thompson be substituted for Maisano as plaintiff. Instead, Oakley Thompson should be joined as the second defendant in this proceeding.

6 Maisano and Oakley Thompson have a relationship that has completely broken down. It would be optimistic in the extreme to expect they could prosecute the taxation of costs side-by-side without any prospect of conflict.

7 In those circumstances, it would be undesirable for them both to be co-plaintiffs. I understand, based on the submissions ultimately put by Oakley Thompson, that an order to this effect is no longer pursued. If it were, I would not grant it. If they were joined as co-plaintiffs Maisano and Oakley Thompson would be separately represented. The general undesirability of such an arrangement with legal representation has long been recognised.[5]

8 Maisano is the proper plaintiff. He is the person in whose favour the costs judgment was granted.[6] That is, and at all times since 4 September 2013 has been, the position. If he wants to continue to exercise his rights pursuant to that costs judgment, he is entitled to do so. Accordingly, Oakley Thompson ought not be added as a plaintiff.

9 Although Oakley Thompson should not be joined as a plaintiff, contrary to Bodycorp's submissions, it is entitled to be joined as a party. Oakley Thompson has established that it has a real interest in the outcome of the Costs Court proceeding, which is more than a mere commercial interest.[7]

10 Oakley Thompson has an equitable interest in the costs judgment presently the subject of a part-heard taxation, which is enforceable as against Bodycorp, now that Bodycorp has notice of the claim.[8]

11 Oakley Thompson is entitled to ensure its interests are protected insofar as it has an equitable right with respect to the costs judgment.

12 In my view, the appropriate and most effective way to ensure the interests of all parties are protected is to join Oakley Thompson as a defendant in this proceeding.[9] At the very least, rule 9.06(b)(ii) of the Supreme Court (General Civil Procedure) Rules 2005 (Vic) is applicable as Oakley Thompson is "a person between whom [a] party to the proceeding there may exist a question arising out of, or relating to, or connected with, any claim in the proceeding which it is just and convenient to determine as between that person and that party as well as between the parties to the proceeding".

13 Presently, it is not entirely clear what position the existing parties will adopt. Depending on the approach taken, Oakley Thompson may have questions for determination against either or both of them.

14 Oakley Thompson is already an active participant in the proceeding. It is its bill of costs which is the subject of the taxation. Whatever be the position taken by the existing parties, to adapt the language of Judd J in the decision of Akron Roads Pty Ltd (in liquidation) v Crewe Sharp,[10] it is unlikely the joinder of Oakley Thompson as a defendant will be prejudicial to the efficient and cost-effective management of the taxation, or will extend the duration of the proceeding in any disproportionate amount of time.

15 If, for whatever reason, Maisano ceases to prosecute the claim, or compromises with Bodycorp, Oakley Thompson may wish to make a further application. But that is for another day.

16 To make it perfectly clear, Oakley Thompson, as a defendant will be entitled to advance its position as a person having an equitable right over the costs judgment, whether or not that right aligns with the position adopted by Maisano. To that end, Oakley Thompson may file a short points of claim or a short affidavit to state its position clearly. There is no need for formal pleadings on such a simple matter. Precisely the means by which Oakley Thompson's position is to be stated is a matter for the Costs Court.

17 It may well be that there will be additional costs because Oakley Thompson has been joined as a defendant. That is also a matter for another day and can be dealt with in due course. It is not a reason to not allow the joinder.

18 In the circumstances, I will make orders in this proceeding that Oakley Thompson be joined as the second defendant.

[1] Oakley Thompson & Co Pty Ltd v Maisano (No 2) [2015] VSC 210, [77]-[78].

[3] At [137]. Relief to this effect was ordered on 24 July 2015.

[5] Konneh v State of New South Wales (No 2) [2013] NSWSC 390, [79]-[83] (Garling J), the cases there cited and, in particular, Lewis v Daily Telegraph Ltd (No 2) [1964] 2 QB 601, 619.4-621.3 (Pearson LJ), 623.2 (Russell LJ), 624.2 (Sellars LJ). See also Kirby v Centro Properties Limited [2008] FCA 1505; (2008) 253 ALR 65, 68 [10]-[11] (Finkelstein J); cf Johnson Tiles Pty Ltd v Esso Australia Ltd [1999] FCA 56; (1999) ATPR 41-679 (Merkel J).

[6] See Bodycorp Repairers Pty Ltd v Maisano (No 8) [2013] VSC 472, [392].

[7] See Telstra Corporation Limited v Australian Telecommunications Authority, (unreported, Supreme Court of Victoria, Hayne J, 7 October 1993) 5-6.

[8] See Oakley Thompson & Co Pty Ltd v Maisano (No 2) [2015] VSC 210, [76]-[78].

[9] Cf Kirby v Centro Properties Ltd [2008] FCA 1505; (2008) 253 ALR 65, 68 [11] (Finkelstein J).

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