Moubarak by his tutor Coorey v Holt

Judgment

1. BELL P: On 24 April 2019, the Court made orders in Moubarak by his tutor Coorey v Holt [2019] NSWCA 102 (the principal judgment) granting leave to appeal and upholding an appeal from a decision of Wilson DCJ who had refused an application for a permanent stay of proceedings on the ground of abuse of process. This Court ordered a permanent stay of proceedings in the District Court. It also ordered the parties to file written submissions in relation to the question of costs in the absence of agreement on this matter. In due course, submissions were filed.
2. Mr Moubarak sought the following orders: "1. All costs orders as between the Respondent/Plaintiff and the Appellant/Defendant in the proceedings below (District Court of NSW, Sydney Registry, Common Law Division, No. 369438 of 2016) be vacated 2. The Respondent/Plaintiff pay the costs of the Appellant/Defendant in the proceedings below (District Court of NSW, Sydney Registry, Common Law Division, No. 369438 of 2016) 3. In the alternate, the Respondent/Plaintiff pay the costs of the Appellant/Defendant in the proceedings below (District Court of NSW, Sydney Registry, Common Law Division, No. 369438 of 2016) with this exception: costs of the hearing before Wass J on 14 February 2018 be vacated and an order that each party pay his or her own costs or in the alternate that no order be made as to costs on that occasion, and 4. The Respondent/Plaintiff pay the costs of the Appellant/Defendant in the proceedings (in their entirety) (Court of Appeal, No. 327586 of 2018)."
3. Ms Holt, the unsuccessful respondent to the appeal, sought the following orders: "1. That each party bear his or her own costs in respect to the whole of the proceedings in the District Court and this Honourable Court. In the alternative: 1. That the Respondent pay the Appellant's costs of the Application for Leave and the Appeal. 2. That the Respondent pay the Appellant's costs of the Stay Application in the District Court. And either: 3. That the costs orders made in the District Court against the Appellant and in favour of the Respondent on 27 October, 2017 and 30 January, 2019 be confirmed, all other costs orders be vacated and each party bear his or her costs in respect to the remainder of those proceedings. OR 3. That all other costs orders in the District Court be vacated and that each party bears his or her costs in respect to the remainder of those proceedings."
4. In Sze Tu v Lowe (No 2) [2015] NSWCA 91, Gleeson JA summarised the relevant principles relating to the award of costs as follows: "37. Costs are not awarded by way of punishment of the unsuccessful party but, rather, 'are compensatory in the sense that they are awarded to indemnify to successful party against the expense to which he or she has been put by reason of the legal proceedings': Latoudis v Casey [1990] HCA 59; 170 CLR 534 at 543 (Mason CJ); Oshlack v Richmond River Council [1998] HCA 11; 193 CLR 72 at [67]; Mahenthirarasa v State Rail Authority of NSW (No 2) [2008] NSWCA 201; 72 NSWLR 273 (Mahenthirarasa (No 2)) at [8] (Basten JA; Giles and Bell JJA agreeing). It follows that the inquiry as to what costs order should be made is primarily directed to the position of the successful party: Latoudis v Casey at 542; Mahenthirarasa (No 2) at [9]. 38. The starting position is s 98 of the Civil Procedure Act 2005 (NSW) which provides that, subject to the rules of court, costs are in the discretion of the Court including by whom, to whom and to what extent costs are to be paid. Reference should also be made to r 42.1, Uniform Civil Procedure Rules 2005 (NSW) (UCPR), which provides that if the Court makes any order as to costs, it should be in terms that costs follow the event unless it appears to the Court that some other order should be made as to the whole or part of the costs. 39. How 'the event' should be defined will depend upon the nature of the litigation. Generally the 'event' refers to the event of the claim and may be understood as referring to the practical result of a particular claim: Windsurfing International Inc v Petit [1987] AIPC 90-441 at 37,861 - 37,862 (Waddell J)."
5. It has also been said that "[w]hether an order contrary to the general rule that costs follow the event should be made depends on the circumstances of the case viewed against the wide discretionary powers of the court, which powers should be liberally construed: State of New South Wales v Stanley [2007] NSWCA 330 at [18] per Hislop J (with whom Beazley and Tobias JJA agreed)": Bostik Australia Pty Ltd v Liddiard (No 2) [2009] NSWCA 304 at [38]."
6. Prima facie, Mr Moubarak is entitled to costs of the application for leave to appeal and the appeal, the hearing of the notice of motion before Wilson DCJ on 1 August 2018 and, indeed, the costs of the proceedings.
7. Costs would normally follow the event which is the default position under the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) but there were a number of features of these proceedings which made it appropriate to call for further submissions in relation to costs. They related to the time at which the application for a permanent stay of proceedings was filed relative to the commencement of the proceedings and also the time between which Wilson DCJ gave his judgment refusing a stay and the filing and hearing of the application for leave to appeal. It is necessary to elaborate briefly in relation to those two matters.
8. As to the first matter, on 9 December 2016 when the proceedings were commenced, Mr Moubarak was already severely demented: see [29] of earlier reasons for judgment. A defence was filed on 12 April 2018. The notice of motion seeking a permanent stay of the District Court proceedings was not filed until 5 June 2018. This was almost 18 months after the proceedings had been commenced. Mr Moubarak's dementia and inability to participate in any meaningful way in the proceedings formed a significant part of the argument in support of the stay, which ultimately succeeded. It was not apparent on the materials before the Court on the hearing of the appeal as to why such a long time was permitted to elapse prior to the filing of the notice of motion, save only for an application for further and better particulars which may have been thought desirable, if not essential, for the purposes of the arguments sought to be made in support of the stay application. These are the particulars referred to at [40] of the principal judgment.
9. The second feature of the case potentially relevant to the question of costs relates to the delay between the decision of Wilson DCJ on 24 September 2018 and the filing of the application for leave to appeal on 20 December 2018 by which time the proceedings had been set down for a hearing in the District Court to commence on or about 29 January 2019. It should be noted that a notice of intention to appeal was filed on 25 October 2018. 20 December 2018 was 8 days short of the three month period from the material date, being the date of Wilson DCJ's dismissal of the notice of motion seeking a permanent stay of proceedings. It was also after the close of the law term and only two business days before Christmas Day.
10. The application for leave to appeal was heard concurrently with the appeal on 15 April 2019. As recorded in the principal judgment at [7]: "It was not until shortly before the luncheon adjournment on 15 April 2019, however, that the Court was informed that the trial in the District Court had been set down for three to five days commencing on 29 April 2019. This fact had not been disclosed to the Registrar at the time the summons seeking leave to appeal was set down for hearing. This was not only regrettable but in apparent breach of a direction of the District Court to seek expedition of the hearing of the application for leave to appeal as a condition of vacating an earlier trial date which had been set for late January 2019. No expedition was sought. If it had been, it would have been granted."
11. The Court is concerned that significant and unnecessary costs may have been incurred by the parties: 1. in the 18 month period leading up to the filing of the stay application; 2. in preparation for the trial between the decision of Wilson DCJ of 24 September 2018 and the filing of the application for leave to appeal on 20 December 2018; 3. in the 2½ month period between 30 January 2019 and the hearing of the appeal in circumstances when no interim stay had been obtained, no expedition in this Court sought and the matter had been set down for final hearing in the District Court to commence on 29 April 2019.
12. That concern has been only reinforced by the revelation, in costs submissions filed by parties, as to the quantum of costs which both have incurred in this matter.

Stays of proceedings should be sought promptly

1. As a general rule, applications for a permanent stay of proceedings should be brought promptly, and determined promptly, for the same reason that it is frequently said that applications for security for costs should be brought promptly: if security is to be ordered, a plaintiff is prima facie entitled to know that before significant costs are incurred: see, for example, Devenish v Jewel Food Stores Pty Ltd [1990] HCA 35; 64 ALJR 533 at 534 per Mason CJ. So, too, it has been held that a party seeking a stay on clearly inappropriate forum grounds should do so promptly: Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197 at 247-248; [1988] HCA 32.
2. Whilst there may be certain limited interlocutory steps that are appropriately taken in any given case before such an application for a stay is filed, such as requests for particulars of a claim or the issuing of a subpoena, tardiness in seeking a stay of proceedings may result in the incurring by all parties of what may be quite unnecessary costs and may also result in wasted court time occupied with case management which, if a stay is ultimately granted, will be rendered otiose.
3. In some circumstances, delay in seeking interlocutory relief may jeopardise a party's prospects of obtaining such relief: see, for example, J D Heydon, M J Leeming and P G Turner, Meagher Gummow & Lehane's Equity: Doctrines and Remedies (5th ed, 2015, LexisNexis Butterworths) at [21-375]. Where an abuse of process or circumstances otherwise warranting a permanent stay of proceeding are made out, delay in prosecuting the application is more likely to result in costs consequences in the event that unnecessary costs have been incurred that would not have been incurred had the stay application been brought earlier, at least in circumstances where its timing was not itself dictated or affected by other interlocutory steps.
4. In relation to the period between the commencement and filing of the stay application in the present case, both parties filed submissions relating to the "back and forth" of requests for particulars of the Statement of Claim and interrogatories and the answers or non-answers given to those requests. This course persisted (although meandered may be a better word) for over a year and included a number of court hearings or mentions. Based upon the written submissions filed, neither side appears to me to emerge with particular distinction in this interchange.
5. Pleadings are required, pursuant to UCPR r 15.1, to include such particulars of any claim, defence or other matter pleaded as are necessary to enable the opposite party to identify the case that the pleading requires him or her to meet. Very often, requests for particulars are met by the rote response that "this is not a proper request for particulars", even where it should have been simple for a meaningful, informative and brief response to be provided. It is almost 20 years since Heydon JA (as he then was) wrote in Nowlan v Marson Transport Pty Ltd (2001) 53 NSWLR 116; [2001] NSWCA 346 at [26] that "the conduct of litigation as if it were a card game in which opponents never see some of each other's cards until the last moment is out of line with modern trends".
6. Requests for particulars are made for a reason and typically relate to a matter or matters that are within the peculiar knowledge of the pleading party. Members of the profession are obliged, by s 56 of the Civil Procedure Act 2005 (NSW), both to facilitate the overriding purpose of the Act and the rules of court in their application to civil proceedings, and not to obstruct the achievement of the just, quick and cheap resolution of the real issues in the proceedings. Where a request for further particulars is made, generally speaking, practitioners should seek to provide a meaningful response and eschew arid and obstructive debates as to the propriety of the request, provided it is reasonably made. That is particularly so when a meaningful response can readily be supplied.
7. Members of the legal profession should also be cognisant of s 59 of the Civil Procedure Act which provides: "In any proceedings, the practice and procedure of the court should be implemented with the object of eliminating any lapse of time between the commencement of the proceedings and their final determination beyond that reasonably required for the interlocutory activities necessary for the fair and just determination of the issues in dispute between the parties and the preparation of the case for trial." The implementation of the practice and procedure of the court is as much the obligation of members of the profession as officers of the court as it is the obligation of the courts themselves.
8. These obligations must be kept strictly in mind by practitioners. It should not take a year, as it did in the present case, for parties represented by members of the profession to resolve a dispute about particulars. That is apt not only to bring the profession into disrepute but is a major disservice to clients.
9. Just as practitioners should be proactive and co-operative in responding to reasonable requests for particulars by, for example, avoiding rote and evasive responses where the answers can readily be given, so too parties requesting particulars or interrogatories should apply discipline to the scope of their requests. This is really all a matter of common sense but one strongly suspects that the delay in the present case in the making and resolution of requests for particulars was contributed to by an old-fashioned trench-warfare approach to this exercise. Such an approach is utterly unsatisfactory.
10. The submissions advanced on costs, however, do not in my opinion allow the blame for this delay to be cast squarely on one party as opposed to the other in the present case.

Applications for leave to appeal where proceedings are ongoing

1. It emerges from the submissions filed by both parties that the defence and stay application were filed relatively soon after very limited further and better particulars were provided. The stay application before Wilson DCJ was heard on 1 August 2018 and judgment given on 24 September 2018. On the same day as judgment was delivered, the proceedings were listed with priority, by reason of Mr Moubarak's condition, in the next sittings of the District Court in Parramatta, due to commence on 15 October 2018, with liberty to apply on 3 days' notice, no later than 28 September 2018, to vary the hearing date. Such liberty was exercised and, on 28 September 2018, the matter was set down for hearing in the week commencing 29 January 2019 with a notation that it was not to be further vacated other than for the most exceptional of circumstances. Judge Wilson also ordered on 28 September 2018 that the defendant was to serve upon the plaintiff all evidence upon which he intended to rely on or before 23 November 2018 and that the plaintiff was to serve upon the defendant any expert evidence in reply on or before 21 December 2018.
2. A notice of intention to appeal was filed in the Court of Appeal on 25 October 2018. This was approximately one month after Wilson DCJ's decision and the setting down of the proceedings for trial initially on 15 October 2018 but then varied to the week commencing 29 January 2019. A summons seeking leave to appeal was not filed until 20 December 2018, almost two months after the filing of the notice of intention to appeal and only some five weeks (including Christmas vacation) prior to the 29 January 2019 hearing date.
3. On 21 December 2018, the day following the filing of the summons seeking leave to appeal, the appellant filed and served a notice of motion in the District Court seeking to vacate the hearing for the week commencing 29 January 2019.
4. By order of Norton DCJ, that motion was heard on the morning 30 January 2019 and the hearing date was again vacated. The defendant was directed to pay the plaintiff's costs thrown away as a result of the vacation in a sum as taxed or agreed and the defendant was directed to take all possible steps to expedite the matter in the Court of Appeal and keep the plaintiff updated as to steps undertaken. On the same day, namely 30 January 2019, the matter was re-listed for hearing in the District Court sittings commencing 29 April 2019 with priority.
5. In their written submissions, counsel for the unsuccessful respondent drew attention to the observations of Allsop P (as he then was) with whom McColl JA agreed in Dillon v Boland; Dillon v Cush [2012] NSWCA 364 at [9] where the President said as follows: "I should also add that although a notice of intention to appeal is available for those seeking leave to appeal, when a matter is urgent, it is, as a matter of practice, self-evidently quite inappropriate to allow a significant period of time to elapse by using a notice of intention to appeal and then an application for leave to appeal. Leave to appeal is required in a variety of matters - some simple procedural matters where timeliness is of the essence, and other matters which are interlocutory and to all intents and purposes final. An example of the latter is an appeal under $100,000, but for procedural applications for leave to appeal such as this, especially where there is a hearing date involving the resources of both the parties and the courts, it is absolutely essential that parties exercise their rights timeously."
6. I endorse those observations. It was quite inappropriate in the absence of some compelling explanation (and none has been forthcoming) for the appellant's legal team to have followed the dilatory course it did in relation to the exercise of its right to seek leave to appeal to this Court in the circumstances of this case. That having been said, I have already noted the order made by Norton DCJ on 30 January 2019 ordering the defendant to pay the plaintiff's costs thrown away as a result of the vacation of the 29 January 2019 hearing date in a sum as taxed or agreed. That order should not be disturbed.
7. The dilatoriness in seeking to move on the right to seek leave to appeal was compounded in a quite unsatisfactory way by the appellant's unexplained failure to seek expedition of the proceedings in this Court, despite that being an express term of the orders made by Norton DCJ on 30 January 2019. Somewhat surprisingly, however, when the application for leave to appeal was called over in the Court of Appeal on 11 February 2019, the respondent's legal representative apparently stayed mute and did not draw that matter to the Registrar's attention.
8. As I noted in [7] of the principal judgment, if expedition had been sought in early February, particularly in circumstances where the matter had been set down for hearing in the District Court to commence on 29 April 2019, expedition would have been granted and the parties would have known the outcome of the appeal several months earlier than in fact was the case.
9. Expedition would also have been granted had the application for leave been filed promptly after Wilson DCJ's decision of 24 September 2018. The practice in this Court is to list appeals and applications for leave to appeal at the earliest possible date. Matters are called over by the Registrar of the Court of Appeal within a matter of weeks of a summons seeking leave to appeal or a notice of appeal being filed. Matters can be listed even more promptly when necessary with a communication to the Registrar or my chambers in an appropriately urgent case. Applications for leave to appeal with respect to ongoing proceedings will be dealt with with particular expedition: see, for example, PPK Willoughby Pty Ltd v Baird [2019] NSWCA 48.
10. It may readily be assumed that both parties incurred some costs at least between 20 October 2018 (a date some 3 weeks after the decision of Wilson DCJ - which was more than adequate time in my opinion in the circumstances of the case to form a view about appeal) and 24 April 2019 (when orders were made in this Court) towards the preparation for hearing of the trial set down in the District Court with priority from 29 April 2019. In my opinion, to the extent that the unsuccessful respondent incurred costs directed to her preparation for trial in the period between 20 October 2018 and 24 April 2019, the appellant should be ordered to pay those costs. Judge Norton's direction to seek expedition in her orders of 30 January 2019 was no doubt actuated by recognition that costs could and would be wasted if the appeal to this Court was not heard expeditiously.

Conclusion and orders

1. I would not vacate any costs orders made in the District Court (other than in respect of the notice of motion resulting in the decision of Wilson DCJ on 24 September 2018). Further, due to the very significant delay in making the stay application, I would not order that the respondent pay the appellant's costs of the proceedings in the District Court other than the costs of and incidental to the notice of motion determined on 24 September 2018.
2. For the foregoing reasons, I would make the following orders: 1. Order that the respondent pay the appellant's costs of the application for leave to appeal in this Court and the costs of and incidental to the hearing of the notice of motion determined by Wilson DCJ on 24 September 2018. 2. Order that the appellant pay any costs incurred by the respondent in the period between 20 October 2018 and 24 April 2019 for the purposes of preparation for the trial of the District Court proceedings initially set down for the week commencing 29 January 2019 and then set down for 29 April 2019.
3. LEEMING JA: As best as may be seen from the appeal books and the parties' submissions, the costs and time involved in the preparation of this litigation have become so substantial that it is difficult to see how the parties and their lawyers have complied with their obligations to facilitate the just, quick and cheap resolution of the real issues. I agree with Bell P, and for the reasons he gives, that the special costs order he proposes is warranted.
4. EMMETT AJA: On 24 April 2019, the Court made orders granting leave to appeal and upholding an appeal from a decision of the District Court, by which that Court had refused an application for a permanent stay of proceedings. The basis upon which the stay was sought was that it would not be possible for the defendant to have a fair trial. This Court ordered a permanent stay of the proceedings in the District Court. Costs would normally follow the event.
5. However, there were several features of these proceedings that made it appropriate to direct the parties to file submissions on the question of costs, which have now been filed. The relevant features related to the time at which the application for a permanent stay of proceedings was filed relative to the commencement of the proceedings and the time between the order of the District Court refusing a stay and the filing and hearing of the application for leave to appeal.
6. I have had the advantage of reading in draft form the proposed reasons of the President in relation to the question of costs. I agree with the President that, apart from the order concerning the costs of the notice of motion for a stay, it is not appropriate to interfere with the costs orders made by the District Court. I agree with the orders proposed by the President for the reasons proposed by him.

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