Pekar v Jess

1. Paragraph 2(a) of the orders dated 28 August 2020 be set aside.
2. The appellant pay the respondents' costs of the interlocutory application dated 23 September 2019, as agreed or assessed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

MOSHINSKY J: 1 On 28 August 2020, I published reasons for judgment in relation to an interlocutory application dated 23 September 2019: Pekar v Jess (Trustee) [2020] FCA 1250. These reasons, which deal with costs, should be read together with those reasons. I will adopt the abbreviations used in the 28 August 2020 reasons. 2 Paragraph 2(a) of the orders made on 28 August 2020 stated that, subject to paragraph (b), there be no order as to costs (in relation to the interlocutory application). Paragraph 2(b) stated that, if either party sought a different costs order, the party could file and serve a written submission within seven days; in that event, the other party could within a further seven days file a responding submission, and the issue of costs would be determined on the papers. 3 Pursuant to those orders, the Trustees filed a submission seeking a costs order in their favour. The Trustees submitted that the usual rule that costs follow the event should apply to the interlocutory application, in respect of which they were successful. 4 Mrs Pekar filed a responding submission, by which she contended that the appropriate order was that there be no order as to costs. Mrs Pekar highlighted the following facts and matters: (a) any need for the interlocutory application to be filed arose solely because the Former Trustee breached his agreement with Mr Pekar (see, eg, Minister for Immigration and Border Protection v CQZ15 (No 2) (2018) 259 FCR 569 at [4]); (b) as observed in the 28 August 2020 reasons at [51]-[52], in the administration of the Mr Pekar's estate, "the total amount incurred by way of trustee remuneration and expenses is very troubling"; and (c) it may not even be necessary and appropriate for the Trustees to obtain possession of and sell the Property to finalise the administration of the estate - that is, obtaining the orders sought in the interlocutory application may well be unnecessary. 5 Although my preliminary view was that the appropriate order was that there be no order as to costs (for practical reasons, as much as anything else), on reflection I consider that the Trustees are entitled to their costs of the interlocutory application, having regard to the usual rule that costs follow the event. In my view, none of the matters raised by Mrs Pekar provides a reason to depart from the usual order that costs follow the event. While the need for the application arose from the Former Trustee's breach of the Agreement, once the Court set aside the Agreement the question whether the consent order made in the present proceeding should be vacated arose as a separate matter. Mrs Pekar could have consented to the orders sought in the interlocutory application, thus avoiding the need for a hearing. 6 Accordingly, I will set aside paragraph 2(a) of the orders made on 28 August 2020, and make an order that Mrs Pekar pay the Trustees' costs of the interlocutory application dated 23 September 2019, as agreed or assessed. I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Moshinsky.