35 Mr Burchett nevertheless contended that the McLaughlins were in substance successful on each of the issues summarised (at [36]) in my reasons for judgment. It is said that the substantive matters in dispute were: first, the legality of the development without the McLaughlins' consent (on which the McLaughlins undoubtedly succeeded and as a result of which they were held to be entitled to damages); secondly, the manner of pursuit of the development (ie, without proper information to members or compliance with director's duties to the company) (in respect of which there was a finding of inadequacy of information on some aspects of the resolutions and leave was granted for a derivative suit in that regard); thirdly, as to the propriety of the buy back resolutions (as to which it is said that there was a finding of breach of the Corporations Act 2001 (Cth) without inadequate information to members, exposing the directors to a derivative suit); fourthly, as to the validity of the resolution approving the compensation package to Mr Garratt (held to be invalid); and, fifthly, the levy imposition and unequal treatment regarding it and its partial refund (the latter being held to be oppressive and remediable by way of payment of interest).
36 It was submitted by Mr Burchett that while there may have been various minor issues in the irregularities in the conduct of the company which were not deemed of themselves to warrant relief, the company had not conceded even those irregularities which were found against it; that the McLaughlins had obtained findings in their favour in that regard; and that these were all matters incidental to the determination of the substantive issues and the grant of substantive relief by way of damages and leave to bring derivative proceedings in respect of the conduct of the directors.
37 Although oppression was not found in relation to the conduct of the company in pursuing the development project itself, Mr Burchett submitted that such conduct was held to be in breach of the McLaughlins' rights under the company's Articles of Association and in part of the directors' duties and, as such, was the subject of a successful claim. Similarly, as I understood his submissions, although the striking of the levy was not itself found to be oppressive, Mr Burchett argued that the levy was struck for the project which was itself in breach of the articles and suggested that, as the McLaughlins were entitled to relief from the levy which was included in the calculation of their damages, there was a measure of success in that regard as well.
38 Broadly speaking, it seems to me that the bases on which the McLaughlins challenged what had occurred in relation to the development project can be grouped into a number of categories:
first, what I will refer to as process driven challenges (raising matters such as whether the various resolutions were properly notified or properly put as special resolutions, or as to the time given in respect of the various meetings) - on which the McLaughlins had mixed success but which ultimately did not lead to any relief in the proceedings;
secondly, challenges based on the adequacy of the information given in relation to the matters the subject of the various resolutions - on which, other than in relation to the information provided in respect of Mr Garratt's compensation and the initial buy-back resolutions, the McLaughlins also failed in their claims;
thirdly, challenges as to the power of the board or the members to take certain steps (as to the development project as a whole - on which the McLaughlins succeeded; and as to the striking of the January special levy and the issue of a forfeiture notice in relation thereto - on which the McLaughlins did not succeed);
fourthly, the claims of oppressive conduct - on which the McLaughlins succeeded only on a very limited aspect; and
finally, the claim for leave to commence proceedings in the name of the company for breach of directors' duties - on which the McLaughlins succeeded.
39 I think it is fair to describe the primary oppression claim and the (in one sense related) allegations as to the adequacy of information provided to the McLaughlins as having dominated the hearing. Mr McLaughlin was cross-examined at length on his opposition to the project and on the information provided to him during the course of the project. Mr Garratt in turn was cross-examined at length in relation to the reasons for entry into the project and his communication with members of the company in relation to the project. Mr Bartrop was also cross-examined as to the project and the communications to members. By contrast, the time occupied in cross-examination of the builders (and the valuer) who gave evidence was much less. The process-driven challenges (though occupying much space in the pleadings and submissions, and, of necessity, in the reasons for judgment) were dealt with relatively quickly in oral submissions during the hearing.
40 However, it seems to me that there was a degree of overlap between the factual matters raised in the context of the oppression/adequacy of information claims and the allegations of breach of directors' duties which formed the basis of the grant of leave to commence derivative proceedings. As I noted in my reasons for judgment [658], the allegations made of the company and its directors in relation to the oppression suit seemed to me squarely to raise the matters of which complaint was made in relation to breach of directors' duties. Therefore, I am not persuaded that a number of the issues on which the company ultimately succeeded (and the McLaughlins failed) were clearly separable from those on which it failed (and the McLaughlins succeeded).
41 It seems to me, in particular, that matters relating to the conduct of the directors in presenting the September 2006 resolutions to the members, committing the company to the building works in advance of finalisation of the conditions for draw down of the finance which had been arranged for the works, handing over the property to the builder, authorising the commencement of the building works in late 2006, agreeing to the compensation to be paid to Mr Garratt (and, for that matter, the terms of the buy-back arrangements with Mr Garratt and Mr Heyworth) and presenting resolutions in relation to the compensation/buy-back arrangements without complete disclosure of matters such as Mr Garratt's overall interest in the company, were all matters on which evidence as to the history of the project and the motivations of the directors would have been in issue whether or not the primary oppression suit had been maintained. To that extent it seems to me that a number of the issues in the proceedings were intertwined. The difficulty in identifying clearly separate or discrete issues (in the sense of issues on which evidence would not otherwise have been led and hence in the absence of which the trial would have been substantially shortened) illustrates the caution to be exercised in embarking on the course of apportioning costs between such issues (whether on a broad brush approach or otherwise).
42 Fundamentally, the McLaughlins' complaint was that the company had no power to enter into this development project without their consent. The company took a contrary position and asserted from the outset an ability to proceed with or without the McLaughlins' consent. To the extent that some of the bases on which the McLaughlins challenged the conduct of the company in entering into the project did not succeed, they nevertheless either did not seem to add substantially to the time occupied in the hearing (such as the cross-examination of Mr Facioni or Mr O'Reilly as to the need for building works of some kind to be entered into or the availability of other building options, as deposed to by Mr Rickard) or were relevant in a broad sense to an understanding of the matters in issue in determining whether there was a serious question to be tried as to breach of directors' duties. In the case of the procedural challenges, while I think there is force in the criticism that a number of those should not have been pursued as they were never likely to lead anywhere, I also think that the bulk of the costs likely to have been occasioned thereby was in the pleading stage of the proceedings (and that is likely to be reflected in the costs orders made in the company's favour in the interlocutory proceedings).
43 Overall, I am not satisfied that this is a case in which fairness demands an apportionment of the costs referable to separate issues in the proceedings and, in saying this, I am mindful of the caution that the ultimate ends of justice may not be served if a party is dissuaded by risk of costs from canvassing all issues which may be material to the determination of the case, to paraphrase from what was said by Jacob J in Cretazzo (at 12).
44 I note that complaint was also made by Mr Priestley as to the time incurred in relation to the application made by the McLaughlins on the third day of the hearing for leave further to amend the pleadings. Mr Priestley notes that half a day was lost debating the amendments and that a separate judgment on that issue was delivered. (As to the latter, the fact that time was spent by me in preparing written reasons seems not to the point. As I made clear at the time, in order not to delay the conduct of the trial I adopted the course of making my rulings on the application orally and then providing written reasons thereafter.) I consider that the costs of the application should be treated as costs in the cause and I do not accept that the loss of half a day in debate on the amendment application, in the course of what transpired to be a six-day hearing, not including the subsequent interlocutory application in February, is such as to warrant an apportionment of costs in that regard.
45 Had I been otherwise of the view that there should be an apportionment of costs to reflect the fact that the McLaughlins had failed to establish oppression in relation to the decision by the directors to enter into the project (as opposed to their success on the issue whether the company had power to enter into the project without their consent), I would not have exercised my discretion to award any portion of the costs of that issue to the company. Rather, I would simply have reduced the costs awarded in favour of the McLaughlins by an appropriate percentage. As it is, however, it is not necessary for me to consider what that percentage reduction might have been as I do not consider this to be an appropriate case in which to depart from the general rule that costs should follow the event.
46 For completeness, I should note that there were aspects of the manner in which, outside of these proceedings, the McLaughlins had expressed their disapproval of the project (and cast aspersions on those involved in the project) which did not reflect well upon them (to which I alluded in my earlier reasons for judgment). Had matters of that kind been raised in the proceedings, then I consider that this would have been an appropriate case to consider an apportionment of costs notwithstanding the McLaughlins' ultimate success in obtaining relief in the proceedings. However, they were not matters which directly related to the conduct of the proceedings in this Court and I do not take them into account in considering the exercise of my discretion in relation to the costs of these proceedings.