Plaintiff v Defendant

Supreme Court of Victoria|2009-04-16|Before: BEACH J

PRACTICE AND PROCEDURE - Ex parte injunction - Failure to make full and fair disclosure of material facts on ex parte application - Legal practitioners - Costs - Costs liability of lawyers - Inherent jurisdiction to order costs against legal practitioners - Party/party costs.

1 This is an application for indemnity costs from a barrister, Mr Colin King, and his instructing solicitor, Mr Terence Grundy. The application relates to an ex parte injunction obtained by Mr King and Mr Grundy on 11 February 2009 on behalf of their client, Mr Anthony Orpen, the plaintiff. The application is made by Ms Daniela Tarantello, the defendant. The bases of the application are as follows:

(a) First, it is asserted that the application for the ex parte injunction should not have been made without notice to the defendant's solicitors.

(b) Secondly, it is asserted that Mr King and Mr Grundy "decided, without express instructions, to apply on an ex parte basis even though the plaintiff had no urgent need ...".[1]

(c) Thirdly, it is asserted against Mr King[2] that when he appeared on 11 February 2009, he failed to disclose a number of relevant facts and/or misled the Court.[3]

(d) Fourthly, it is asserted that obtaining the ex parte order "was all pre-planned and executed with reckless disregard for the defendant's legal rights".[4]

(e) Fifthly, complaint is made concerning Mr Grundy's refusal to attend Court on 12 February 2009. It is asserted that Mr Grundy refused to attend Court because he did not want the Court to learn of the matters which had not been disclosed on 11 February until after the defendant was required to comply with the orders obtained on 11 February.[5]

(f) Sixthly, it is asserted that both Mr King and Mr Grundy committed the breaches of duty alleged against them for their own personal gain.[6] These allegations relate to the possibility of Mr King and Mr Grundy being paid their fees and professional costs from moneys obtained from the defendant upon a conclusion of the matter favourable to the plaintiff.

2 For the reasons given below, there will be an order that Mr King and Mr Grundy pay the defendant's party/party costs of and incidental to:

(a) the plaintiff's summons filed 12 February 2009 and the hearing before Pagone J on 13 February 2009; and

(b) paragraphs 1 to 3 of the defendant's summons filed 20 February 2009 and the hearings before Smith J on 25 February 2009.

History of the dispute between the plaintiff and the defendant

3 The plaintiff and the defendant and various parties related to them have been involved in a number of different legal proceedings (seven proceedings are identified by the defendant's solicitor, Mr Kenny[7]). This proceeding concerns a dispute between the plaintiff and the defendant concerning a property situated at 8 Mellon Court, Sunbury ("the Mellon Court property"). The Mellon Court property has been the subject of a proceeding in the County Court between the parties and a proceeding at VCAT between the parties. In the County Court proceeding, the plaintiff alleged he entered into a domestic relationship with the defendant. He said this relationship began in late 1986 and ended in February 2006. In that proceeding he sought an order for the adjustment of property interests pursuant to s 285 of the Property Law Act 1958. The plaintiff's application was out of time[8] and he sought leave to bring his application out of time pursuant to s 282(2). The application for leave came on before Judge Misso on 24 November 2008. Affidavit evidence was tendered. However, there was no cross-examination.

4 On 26 November 2008, Judge Misso delivered judgment. Judge Misso did not accept the plaintiff's evidence that a domestic relationship existed between the plaintiff and the defendant commencing in late 1986 and ending in February 2006. He preferred the evidence of the defendant, which was that the domestic relationship commenced in January 1989 and ended in November 1991, and then a second domestic relationship commenced in 1997, which ended in January 1999.[9] After dealing with the period of the first domestic relationship, Judge Misso noted that the only financial transaction which occurred during the second period was the purchase of a property at Riddells Creek.[10] The plaintiff's application for leave was dismissed. Mr King appeared for the plaintiff in the application for leave, instructed by Mr Grundy.

5 On 12 January 2009, the trial of the VCAT proceeding commenced. This was a proceeding commenced by the defendant to have the plaintiff evicted from the Mellon Court property. This proceeding was dismissed by VCAT on 22 January 2009 on the basis that the Tribunal was not satisfied that a residential tenancy agreement had been entered into between the plaintiff and the defendant. Following the dismissal of the defendant's VCAT proceeding, the solicitors for the defendant sent a letter by fax to Mr Grundy on 23 January 2009 ("the 23 January letter"). The letter provided:

"URGENT

Dear Sir,

On 12 January 2008, your client gave sworn evidence in the witness box at VCAT.

He gave evidence that in September, 2005 he entered into an agreement with my client that he could reside in the property at 8 Mellon Court Sunbury, and he would pay half of the mortgage payments for that property and half of the mortgage for the Riddells Creek property ("the agreement").

Under cross examination, he agreed that the schedule produced by my client, which listed all of the payments made by your client (by way of deduction from his salary) was correct.

As you know, my client claims that those payments were payments of rent.

Your client denied that the payments were rent, and said that the payments were made pursuant to the above mentioned agreement. Your client submitted, through his counsel, that a residential tenancy agreement was never entered into.

Your client conceded under cross examination, that

a. He has never made a single payment towards the Riddells Creek mortgage, and

b. The last payment was the payment deducted on 25 October, 2007 and since then he has not made any payment.

The VCAT Member, Mr Galvan, decided that he was not satisfied that a residential tenancy agreement had been entered into and so he formally found that no residential tenancy agreement had been entered into. He refused my client's application for possession pursuant to the Residential Tenancies Act.

On your client's version your client is in breach of the agreement.

My client is entitled to terminate the agreement by reason of the breach.

Take notice that my client does so. The agreement is terminated.

Your client is required to vacate the premises immediately.

Could you please confirm to me by 5pm on Tuesday 27 January 2009 that your client intends to do so and please also advise me when he will leave the property.

Yours faithfully,

Kalus Kenny"

Mr Grundy did not respond to the 23 January letter. He did not dispute its contents or assert that it misrepresented what occurred at VCAT with Mr Kenny. He merely passed the letter on to Mr King.

6 On 10 February 2009 (at 9.02am), Mr Grundy sent a letter to Mr Kenny in relation to an application returnable in the Magistrates' Court on that day. In the course of the letter, Mr Grundy disclosed to Mr Kenny that the plaintiff was interstate on business. Later that day (at approximately 3.00pm), Mr Kenny sent a letter ("the 10 February letter") to Mr Grundy in the following terms:

"Dear Sir,

I am instructed to advise your client that my client has today repossessed the above property [8 Mellon Court, Sunbury].

4 boxes containing Mr Orpen's clothes and toiletries have been removed from the house and are with a courier service who will deliver them to your office tomorrow morning.

Removalists will deliver your client's other property to an address he nominates if you can advise me within 24 hours. Otherwise the property will be placed in storage awaiting your client's instructions.

Mr Orpen will not be allowed to enter the house. There is no reason for him to enter there now.

The locks have been changed and security guards have been retained.

Yours faithfully,

Kalus Kenny."

7 On the evening of 10 February 2009, there was a telephone conversation between Mr Kenny and Mr Grundy.[11] There is a dispute between Mr Kenny and Mr Grundy as to whether this telephone conversation was "off the record" or a "private conversation". Mr Grundy asserts that the conversation was off the record or private (he concedes that he did not use the phrase "without prejudice"). Mr Kenny says that the conversation was open and nothing was said to indicate that it was either off the record or private in the sense that it could not be disclosed. In his affidavit of 10 March 2009,[12] Mr Grundy deposes that it is his recollection that he "may have used the words 'off the record' or 'private conversation'". Shortly after the conversation, Mr Kenny sent an email to the defendant reporting on the conversation.[13] Having seen Mr Kenny cross-examined, I am satisfied that he would not have sent this email had he been told that the conversation was off the record or private in the sense that it was not to be disclosed. I find that whilst Mr Grundy now believes he may have used the words "off the record" or "private conversation", no such words were actually used. It may be that Mr Grundy thought that because there were private aspects of the conversation he had with Mr Kenny, the conversation was to be treated as off the record or private in the sense that it could not be disclosed. However, having heard both Mr Kenny and Mr Grundy, I am not satisfied that this was conveyed by Mr Grundy to Mr Kenny.

8 The conversation between Mr Kenny and Mr Grundy on 10 February is relied upon by the defendant in two respects:

(a) First, Mr Kenny's note of the conversation[14] contains a statement attributed to Mr Grundy as follows:

"Anthony [the plaintiff] is in Western Australia for a few more days. I have instructions to issue proceedings claiming a constructive trust but I am not going to issue it. I've had enough of him and the Standard Capital guys. I am not going to act for Anthony any more. I'm just a sole practitioner. I can't afford it. I only stayed in the case hoping that I would be paid from a settlement. As there is not going to be a settlement, I'm not going to act."

The reference to only staying in the case and hoping to be paid from a settlement forms the basis of the defendant's contention that Mr Grundy committed the breaches of duty alleged against him for his own personal gain. I will deal with this aspect below.

(b) Secondly, it is said that in saying he was not going to act for the plaintiff any more and then in seeking ex parte orders the following day, Mr Grundy misled Mr Kenny. The defendant contends that if Mr Grundy changed his mind between the time of the conversation and going to Court on 11 February, then he was duty bound to convey this fact to Mr Kenny. It was put in cross-examination of Mr Grundy that he "essentially misled Mr Kenny".[15] Mr Grundy denied this assertion. Whilst Mr Grundy did convey to Mr Kenny that he intended to cease acting for the plaintiff, I do not find that there was any relevant or intentional misleading of Mr Kenny by Mr Grundy. Legal practitioners from time to time express intentions that they may or may not act or continue to act for a particular party, which intentions can (and sometimes do) change.

The ex parte application on 11 February 2009

9 The ex parte application was made to Pagone J in the Practice Court on the afternoon of 11 February 2009. Mr King was instructed by Mr Grundy, who was present in Court throughout the hearing. Mr King told the Court that it was an urgent application and that he would call his instructing solicitor "to give evidence as to the events of the last 24 hours".[16] Mr King described the case in the following terms:

"Mr Anthony Orpen was in a de facto relationship with Daniela Tarantello. There's a dispute over the period of time but taking it at its shortest period, from 1988 until; according to her 1999; according to him 2006.

In any event, Your Honour, a writ and statement of claim were issued in the County Court claiming an interest in property pursuant to Part 9 of the Property Law Act. There were two properties; one in Riddells Creek, and one in Sunbury at 8 Mellon Court; 8 Mellon Court is the subject of this application."[17]

"There was a business involved. In any event, Mr Orpen brought his application out of time in the County Court, so a further application was made under ... s 282(2) ... for an extension of time ... . Judge Misso dismissed the summons ... .

The next thing that happened was that Mr Orpen, who was resident in 8 Mellon Court ... received notice of an application in VCAT under the Residential Tenancies Act for an order to have him ejected from those premises. I appeared for Mr Orpen in VCAT and we argued that it wasn't a residential tenancy and the argument was upheld by the senior member and Mr Orpen remained in the premises.

During that application, Mr Orpen gave evidence that he had issued instructions to his solicitor, Mr Grundy, to start work on a writ and statement of claim in the Supreme Court of Victoria for Mr Orpen to claim an equitable interest in not only Mellon Court, but also the other property at Riddells Creek and a joint business that he and his ex-partner were running. That hasn't yet been done but instructions are firm to do so.

Mr Orpen left this State a few days ago, to go to Western Australia and is currently on his way back. I've spoken to him recently in the last half an hour on the telephone and he's currently about 400 miles from Whyalla, driving, and he's trying to get back here as soon as possible and he intends to catch a plane from Adelaide when he gets there.

But last night my instructor received a letter from the solicitor of Ms Tarantello advising that they had taken possession of the premises where Mr Orpen was living at 8 Mellon Court. They couriered his personal belongings to Mr Grundy's office that arrived today (sic), and they retained the furniture awaiting instructions as to where that should be delivered.

So the purpose of this application, Your Honour, is to have orders to allow Mr Orpen to go back into the property pending the hearing of this matter where the proper documentation can be brought before you and pursuant to the Minutes of Order that (sic I) emailed to your associate, we've also made the usual undertakings and will issue a writ and a statement of claim."[18]

10 In answer to a question from his Honour as to whether anybody else was entitled to live at the Mellon Court property, Mr King said:

"Well, that's the nub of the dispute, Your Honour, that will come before this Court once the writ and statement of claim are issued. The property is registered in the name of the defendant, Daniela Tarantello. ...

Mr Orpen claims an equitable interest in that, because he says - well, we've been living together for 20 years, we've each contributed et cetera, et cetera and I have a claim against this property. He gave evidence in the Tribunal that the arrangement between them was that he would live in 8 Mellon Court, pending the resolution of their property dispute. Now, as I indicated to Your Honour, it went to the County Court in the first instance. ... But he was out of time, so that was dismissed. So now we have to start again in the Supreme Court claiming an interest in equity."[19]

11 His Honour raised with Mr King the question of whether or not Mr King needed an order preventing the defendant from entering the property. Mr King responded:

"Yes, I do, Your Honour, because Mr Orpen wants to go back into the property and remain living there until the major dispute between them is settled. So the main thrust of this application is to get him back into the property to resume the status quo as it were and ancillary to that is the matters relating to his personal property and the furniture.

Now, at the moment the personal property, according to the solicitor for Ms Tarantello, has been sent by courier to Mr Grundy's office and he will give evidence that there are some boxes there that aren't opened yet. Whether that's all of his personal property, we don't know."[20]

12 There was then a further exchange between his Honour and Mr King, before Mr King handed up the 10 February letter saying that it was the letter he was going to get Mr Grundy to give evidence about - being "the letter from the solicitor for Ms Tarantello that was received yesterday afternoon".[21] His Honour then told Mr King that he was prepared to act "upon what you tell me, given the urgency of the ... matter", to which Mr King responded:[22]

"Well, the problem is, Your Honour, that my client was living in these premises, he says by an agreement with Tarantello, with his ex-partner. And she lost an application in VCAT to have him expelled.

...

And as soon as he goes interstate, she moves in, changes the locks and he suddenly has nowhere to live on his return."

13 There was then a further exchange between his Honour and Mr King in which his Honour said he was "not prepared to make an order against somebody without hearing them except in the clearest case".[23] His Honour then indicated a preparedness to make an order preventing the removal of property. This caused Mr King to make further submissions calculated to persuade his Honour to make an order for the delivery up of a set of keys. During the course of these submissions, the following exchange occurred between his Honour and Mr King:[24]

"Mr King: Well, he needs to get into the premises tomorrow, when he gets back. Now, that's the purpose of this application, sir.

His Honour: Well, let's assume - see, from my point of view what I've got to try and do is balance potential rights with somebody who's not here.

Mr King: Yes, I understand.

His Honour: So let's assume that once the defendant gets this order served upon her, she comes racing to me and said - look, you've made a fundamentally wrong order about the keys. I really do want to give her time to be able to, if that's wrong, to be heard on it.

Mr King: Yes."

14 Ultimately, upon undertakings being given as to the filing and service of a writ, a summons and an affidavit by Mr Orpen and upon an undertaking being given as to damages, his Honour ordered:

"1. The defendant Daniela Tarantello be restrained until 4.00pm on 13 February 2009, or further order, from removing personal property or items from the property at 10[25] Mellon Court, Sunbury in the State of Victoria.

2. The defendant deliver up to the Sunbury Police Station a copy or set of keys of the property by 5.00pm 12 February 2009, for collection by the plaintiff.
3. The plaintiff's solicitor to notify the defendant's solicitor of this order by telephone before 5.00pm today and serve on the defendant's solicitor as soon as practicable by facsimile today a copy of this order.
4. Costs reserved."

15 Following the conclusion of the ex parte application, Mr King telephoned Mr Kenny and advised him of the ex parte injunction that had been granted. Mr Kenny asked why he had not been given notice as he had been in his office all day. He also asked Mr King whether the 23 January letter had been shown to the judge. Mr King answered "No". Mr Kenny then told Mr King that he was under a duty to bring all relevant matters to the Court's attention, to which Mr King responded "I'm not going to argue with you".[26]

16 On 12 February 2009, the defendant's solicitors wrote three letters to Mr Grundy. The first letter provided:

"URGENT

Dear Sir,

We have been in touch with the Supreme Court this morning and have indicated to the Associate to Justice Pagone that we wish to come before the Court today with a view to having his Honour's orders of yesterday discharged or varied.

Counsel retained by our client is in the process of being briefed and to that end we have requested that the Court hear our client's application at 2:15pm. This is subject to confirmation by the Court that his Honour can hear our application at that time.

As soon as the Court informs us as to the availability of his Honour we will let you know.

Yours faithfully,

Kalus Kenny."

"URGENT

Dear Sir,

We refer to our recent communication to you.

We have been informed by the Court that his Honour will entertain our client's application at 2:15pm today. However his Honour, through his Associate, has informed us that such attendance before the Court is to be by agreement between the parties.

We consider that given the circumstances in which this application was made by your client, that his Honour should be appraised of all relevant facts and matters, given the facts and matters contained in paragraph 2 of his Honour's order.

In the circumstances, we trust that common sense will prevail and that you will by return, especially having regard to the content of the phone conversation between our Mr Kenny and you on 10 February 2009, confirm your agreement.

Please let us have your confirmation by return.

You should be aware that we will be producing a copy of each of our communications sent to you today, to the Court at 2:15pm.

Yours faithfully,

Kalus Kenny"

"Dear Sir

We refer to our facsimile communications of this morning to which there has been no response.

One way of obviating the necessity to make our foreshadowed application is to obtain your client's consent to a variation to paragraph 2 of the Order made by His Honour yesterday, so as to extend the time provided for in paragraph 2 to 5:00pm on 13 February 2009, or further order.

Can you please confirm your client's consent to this variation immediately so that we can draw appropriate orders that can then be provided to the Court.

Yours faithfully

Kalus Kenny."

19 Mr Grundy responded to the suggestion that he should agree to go into Court on 12 February in the following terms:

"Dear Sir

Re: A Orpen and D Tarentello

I refer to your correspondence of this morning.

My client does not consent to the hearing this afternoon. With a hearing for a more final determination scheduled to be heard less than 24 hours away, a further hearing this afternoon would be unproductive. Your client can have her concerns agitated then. The intention of the orders obtained yesterday was to maintain the status quo.

Yours faithfully,

Terence F Grundy."

Notwithstanding the implicit suggestion in the second of the defendant's letters of 12 February 2009 that his Honour had not been "appraised of all relevant facts and matters", Mr Grundy neither consented to going back to Court ahead of 13 February 2009 nor consented to an extension of the time for compliance with paragraph 2 of the orders made on 11 February. Whilst it might be said that the defendant could have sought to be heard in the Practice Court on 12 February (notwithstanding the plaintiff's failure to consent), I should note for the sake of completeness that the defendant made such an attempt - but was not heard because of the lack of consent.[27]

20 Pursuant to the undertakings given by the plaintiff on 11 February 2009, the plaintiff filed and served a writ, a summons returnable on 13 February seeking interlocutory relief and an affidavit sworn by Mr Orpen in support of his application. The matter came on for hearing before Pagone J on 13 February 2009. Again, Mr King appeared for the plaintiff. After advancing his argument, counsel for the defendant commenced by noting there were four issues, namely:

(b) no proper basis for the giving of an undertaking as to damages;

21 His Honour sought to focus the argument on whether there was an agreement as alleged by the plaintiff. Counsel for the defendant was asked to identify his evidence concerning that issue. During the course of outlining the defendant's evidence on that issue, the question of whether the 23 January letter had been put before his Honour on 11 February was raised. The transcript discloses that Mr King vigorously asserted that he had handed the letter to his Honour on 11 February.[28] There is no doubt the 23 January letter was not handed to his Honour or referred to on 11 February. Mr King's explanation for asserting on 13 February that he had handed the 23 January letter to his Honour on 11 February was that he misunderstood which letter counsel for the defendant was referring to (he thought counsel for the defendant was referring to the 10 February letter - which was indeed handed to his Honour on 11 February).[29] I accept Mr King's explanation. The transcript discloses a level of confusion by Mr King on this issue.[30]

22 Ultimately, his Honour cut off the defendant's submissions, saying "Let's short circuit the process. I don't need to hear you on the main issue. Tell me what you want to say about costs".[31] After hearing further argument, the plaintiff's summons was dismissed. Counsel for the defendant foreshadowed that an application for costs would be made against Mr Grundy.[32] Further, counsel for the defendant asked his Honour for orders requiring delivery up of the keys (the subject of paragraph 2 of the orders of 11 February) and vacant possession. His Honour declined to make those orders in the absence of a summons issued by the defendant.[33] At the request of both parties, costs were reserved.

23 On 20 February 2009, the defendant issued a summons seeking the following orders:

1. The plaintiff vacate the property at 8 Mellon Court, Sunbury ("the property") by 4.00pm on 25 February 2009.
2. The plaintiff deliver up to the Sunbury Police Station, for collection by the defendant, the keys to the property and any copies made of the keys by 5.00pm on 25 February 2009.
3. Until further order, plaintiff be restrained, whether by himself or by his servants or agents, from entering onto the property.

Orders sought against Mr Terence Grundy and Mr Colin King

4. Mr Terence Grundy and Mr Colin King pay the defendant's costs of an (sic) incidental to the plaintiff's summons dated 12 February 2009 on an indemnity basis.
5. Mr Terence Grundy and Mr Colin King pay the defendant's costs of this application on an indemnity basis.
6. Such further or other orders as the Court deems fit."

24 The defendant's summons came on for hearing in the Practice Court before Smith J on 25 February 2009. On that day, three separate sets of orders were made by Smith J. First, in the absence of the plaintiff, orders were made requiring him to vacate the property and deliver up the keys by 5.00pm on 25 February 2009. Secondly, after the plaintiff appeared in person, those orders were varied to extend the time until 4.00pm 11 March 2009. Thirdly, an order was made in relation to the filing and serving of a statement of grounds for the defendant's application against Mr Grundy and Mr King, the filing and serving of affidavits and outlines of argument, and the adjournment of that application for hearing on a convenient date. Subsequently, the timetabling orders were extended by an order made on 5 March 2009.

The costs orders sought by the defendant from Mr Grundy and Mr King

25 In the defendant's statement of grounds, the defendant identifies the costs she seeks from Mr King and Mr Grundy on an indemnity basis as:

"1. From 5.30pm on 11 February 2009 in respect of the ex parte order made by Pagone J that day.

2. The costs of 12 February 2009 in preparing to oppose the application of the plaintiff, made by summons dated 12 February 2009.
3. The costs of appearing before Pagone J on 13 February 2009.
4. The costs incurred following the orders made by Pagone J on 13 February 2009 dismissing the plaintiff's summons.
5. The costs of making application to the Court by summons dated 20 February 2009 and the appearance before the Court on the morning of 25 February 2009 and the separate appearance before the Court on the afternoon of 25 February 2009.
6. The appearance before the Listing Master on 25 February 2009.
7. The costs of obtaining possession of the property from the plaintiff.
8. The costs of and incidental to the hearing fixed on 2 April 2009,[34] including the costs of the hearing itself."

26 In the defendant's outline of submissions, the costs sought are described as the "costs of and incidental to the applications before Pagone J on 13 February 2009 and before Smith J on 25 February 2009 and the costs of and incidental to the hearing ... [of this application]". As the costs of this application depend upon the conclusions I make in respect of it, I informed the parties during the hearing that those costs would be considered separately upon the delivery of this judgment.

Principles to be applied concerning the obtaining of ex parte orders

27 Having regard to the grounds upon which the defendant seeks indemnity costs from Mr King and Mr Grundy, it is necessary to state the principles to be applied concerning applications for ex parte orders. These principles may be summarised as follows:

(a) First, the duty owed by a plaintiff seeking an ex parte order is to place before the Court all material facts and matters.

(b) Secondly, the duty is an absolute one, owed to the Court.

(d) Fourthly, it is no excuse for a plaintiff to say he was not aware of the importance of a particular material fact.

(e) Fifthly, a party fails in this obligation "unless he supplies the place of the absent party to the extent of bringing forward all the material facts which that party would presumably have brought forward in his defence to that application".[35]

(f) Sixthly, materiality is to be decided by the Court, and not by the assessment of the plaintiff or his legal advisers.

(g) Seventhly, a plaintiff must disclose any defence he has reason to anticipate may be advanced. A high standard of candour and responsibility is required of those who seek ex parte orders.[36]

Was there a breach of duty on 11 February 2009?

28 The defendant's complaint concerning the failure to disclose material facts and/or misleading the Court on 11 February is summarised in paragraph 7 of the defendant's statement of grounds.[37] Paragraph 7 provides:

"7. When Mr King, instructed by Mr Grundy, appeared on 11 February 2009 he failed to disclose all of the relevant facts to the Court, or alternatively mislead (sic) the Court.

a. Mr King was aware of the sworn evidence that was given by Mr Orpen at the VCAT hearing. Mr King was counsel in that proceeding and was present when Mr Orpen gave his evidence. Mr King did not inform the Court of the agreement pursuant to which Mr Orpen stated, under oath, he went into occupation of the property. Mr King did not inform the Court, that on Mr Orpen's sworn version of that agreement, Mr Orpen admitted being in default for failing to make payments since October, 2007.

b. Mr King mislead (sic) the Court when he told Pagone J that the plaintiff gave evidence at VCAT that he had an arrangement with the defendant that he could reside at the property pending the resolution of their property dispute. Mr King did not inform the Court that at the VCAT hearing the plaintiff also gave sworn evidence as to an agreement he claimed to have entered into with the defendant pursuant to which he occupied the property.

c. The letter from Kalus Kenny to Mr Grundy dated 23 January 2009. This failure was conceded by Mr King when Mr King called Mr Kenny at about 5:30pm on 11 February 2009 to inform him of the orders, Mr Kenny asked Mr King 'did you tell his Honour about my letter dated 23 January?' Mr King replied 'No.'.

d. The fact that the undertaking as to damages proffered was worthless.

e. The matters deposed to by the parties in the County Court proceeding, and the findings made by Judge Misso, were not disclosed and in particular the fact that:

(i) the defendant had sworn uncontradicted material in the County Court concerning the purchase by her of the Sunbury property;

(ii) the plaintiff did not claim to have made any financial contribution to the purchase of the Sunbury property;

(iii) Mr King mislead (sic) the Court when he told Pagone J that the plaintiff had contributed to the property. Mr King claims to have drafted the plaintiff's affidavit from instructions he had previously obtained from the plaintiff. The plaintiff had never given Mr King instructions that he had contributed to the property, and the plaintiff had not instructed Mr King or Mr Grundy to deny the matters contained in paragraph 13 of the defendant's affidavit sworn on 5 November, 2008 in the County Court. When Mr King drafted the words in paragraph 8 of the plaintiff's affidavit sworn on 12 February, 2009, that the plaintiff made equal contributions to the purchase of the properties, Mr King knew that was not true. (sic;)

(iv) findings of fact had been made by the Court concerning the period during which there had been a de facto relationship and what those findings were;

(v) the Sunbury property had been purchased by the defendant some years after the cessation of the de facto relationship;

(vi) Mr King mislead (sic) the Court when he told Pagone J that at its shortest period (ie the defendant's claim) the de facto relationship between the parties lasted for 11 years (from 1988 to 1999). Mr King and Mr Grundy knew that the defendant's evidence was that the relationship lasted for 2 years from 1989 - 1991, and then for 2 years from 1997 - 1999. Mr King and Mr Grundy knew that Judge Misso had made a finding of fact to that effect. On this finding of fact, it is clear that the defendant acquired the Sunbury property at least 4 years after that relationship had ended. Again, this important fact was not disclosed to the Court."

29 Two points should be made at the outset. First, in explaining any case to a Court, it is always possible to go into greater detail. The Practice Court is a busy Court and brevity (and such expedition as can be achieved consistent with the performance of duties owed to the Court) is to be lauded. Secondly, this case is different from what might be called usual urgent ex parte applications in that both the solicitor (Mr Grundy) and the barrister (Mr King) had appeared and acted for the plaintiff in other proceedings concerning the same subject matter in the relatively recent past. This was not a case of a barrister and solicitor appearing seeking urgent ex parte orders in circumstances where they had only just been instructed by the client in respect of the subject matter of the dispute and were still trying to marshal the facts.

30 The most significant matter that was not disclosed on 11 February was the 23 January letter. The letter states the defendant's position - which was that any agreement pursuant to which the plaintiff contended he occupied the Mellon Court property was terminated. This was a material fact which should have been brought to the attention of the Court. It was a fact known to both Mr Grundy and Mr King. Mr King's explanation[38] that he thought the letter was "a step in a strategy to seek possession of the Mellon Court property" is beside the point. Similarly, the fact that Mr King and Mr Grundy considered that the 23 January letter misstated the effect of the evidence of the plaintiff at VCAT was not to the point. These were matters which should have been raised with the Court on 11 February.[39] Having raised them, Mr King (and/or Mr Grundy) could then have made submissions to the Court as to why the letter should be disregarded or not seen as telling against the granting of the orders sought by the plaintiff.

31 The failure to disclose the existence of the 23 January letter also misled the Court as to the circumstances in which it was submitted that the application was urgent. The Court was led to believe by Mr King's submissions that the matter was urgent, having arisen in the previous 24 hours. Indeed, it was suggested that what happened on 10 February was unexpected and came without warning when the plaintiff went interstate a few days before 11 February. However, the true position is that the 23 January letter discloses an assertion by the defendant of an entitlement to possession. Had the Court been advised on 11 February of the existence of the 23 January letter, there is every prospect the Court would have declined relief either because of insufficient merit or because of delay from 23 January. Alternatively, the Court may have concluded that it was not appropriate to deal with the matter without notice to the defendant. In the course of his submissions, counsel for Mr King advanced an argument that I should not be critical of the failure to disclose the 23 January letter because, on one view of the facts, its disclosure may have assisted the plaintiff in obtaining the orders he sought. This is no answer. It merely highlights the materiality of the 23 January letter. The plaintiff (and his legal advisers) were not entitled to arrogate to themselves the issue of the materiality of the 23 January letter. In failing to disclose its contents to the Court, there was a breach of the duty owed by Mr King and Mr Grundy to the Court.

32 Having found there was a material non-disclosure in respect of the 23 January letter, it is strictly speaking not necessary to consider ground 7(a). However, for the sake of completeness I should say that what was required on 11 February was disclosure of the 23 January letter. It was not necessary for Mr King to accept the characterisation of Mr Orpen's evidence in it. What Mr King was required to do was tell his Honour that the defendant asserts that Mr Orpen gave evidence as set out in the 23 January letter but that a fair reading of the whole of the transcript discloses that Mr Orpen's case and evidence in VCAT was not so limited. The same points may be made in respect of ground 7(b). Mr King was entitled to put Mr Orpen's case. However, he was required to put what the defendant would say was the effect of Mr Orpen's evidence (and then entitled to put any answer he might have). Grounds 7(a) and (b) are rooted in the failure to disclose the 23 January letter on 11 February.

33 In the course of argument, counsel for Mr Grundy sought to distance Mr Grundy from any breach of duty I might find on the part of Mr King in relation to the 11 February hearing. It was put that Mr Grundy "was not the person who was on his feet and actually able to take control of the situation and ensure if there was anything that his Honour needed to know".[40] It was also said by Mr Grundy, in defence of his position:[41]

"I mean I am the only one in this room that was there, and I know it's just demonstrated to me how you can read a transcript, and if you are actually there how it can be a lot different. I mean, Justice Pagone took charge of the whole matter and that's his right to do so, and he - Mr King said 'My instructor, Mr Grundy, is here and he is going to give evidence', and we were just not given the opportunity to do so".

However, it is to be remembered that when Mr King opened the matter to his Honour, it was opened on the basis that Mr Grundy would give evidence "as to the events of the last 24 hours"[42] and the 10 February letter.[43] Mr Grundy was not to be called to give evidence of the 23 January letter. Mr Grundy owed the same duty as that owed by Mr King in relation to ensuring that there was full and fair disclosure of all material facts to the Court. There is no evidence that Mr Grundy told Mr King to mention the 23 January letter or that he (Mr Grundy) took any steps to appraise his Honour of its existence. Apart from the fact that Mr King was on his feet and Mr Grundy was instructing, there was no relevant difference in their positions on this issue.

34 Complaint is made by the defendant concerning Mr King's failure to tell Pagone J on 11 February of Judge Misso's findings as to the length and duration of the two domestic relationships. Mr King and Mr Grundy answered this by saying that the application before Judge Misso was an interlocutory application, decided on affidavits and not giving rise to any issue estoppel or res judicata. Again, in taking this approach, Mr King and Mr Grundy arrogated to themselves the issue of materiality. It was incumbent upon them to say to his Honour that findings of fact had purportedly been made by Judge Misso and then to advance any argument they wished to advance as to why Pagone J should not view those findings as an impediment to the obtaining of ex parte orders.[44] Mr King and Mr Grundy were duty bound to say to the Court what the defendant would have said had she been given notice and attended on 11 February. It is not to the point that it was the perception of Mr King and Mr Grundy that Pagone J took charge or was "busy". No Court would stop a legal practitioner applying for an ex parte injunction from saying "Your Honour, there are the following matters I must bring to your attention as matters which would be advanced by the defendant if she was here today".

35 Similarly, it is not to the point that Pagone J did not express any criticism on 13 February in relation to any failure to disclose material facts. The transcript of 13 February shows that counsel for the defendant raised the issue of non-disclosure and then proceeded to advance other arguments. It was in the course of advancing those other arguments that his Honour determined the plaintiff's application should fail. Reliance was placed by Mr King on a statement by his Honour[45] "I'm not critical of you personally". However, a reading of this statement in context shows that it relates to the late receipt of an affidavit, rather than any issue of non-disclosure or misrepresentation.

36 It is also unfortunate that Mr King misstated the period of the de facto relationship that the defendant would admit to. He asserted to Pagone J that the defendant contended it was from 1988 until 1999, whereas the defendant's actual position was that the second (and more relevant) period of the relationship was only between 1997 and January 1999. Similarly, it was unfortunate that Mr King did not tell his Honour that the Mellon Court property was purchased by the defendant in November 2004 (more than five years after the end of the de facto relationship on the defendant's account of matters). The answer that these facts were not material because there were two relationships between the plaintiff and the defendant (a de facto relationship and a business relationship) and that ultimately relief would be sought based upon the existence of both relationships is not to the point. The facts underlying the claims being asserted on behalf of the plaintiff were critical. They were misstated and orders were made based upon those misstatements. However, I reject the defendant's contention that his Honour should have been told in any detail what the evidence of the defendant was at VCAT. It would have been enough to tell his Honour that the bases upon which relief was sought were all heavily disputed and denied by the defendant and that findings of fact had been made in an interlocutory application which told against a number of the matters asserted on behalf of the plaintiff (with his Honour being taken to the relevant findings of Judge Misso).

37 Similarly, I reject the defendant's contention that there was any failure to disclose a relevant fact or misleading of the Court in the proffering of the undertaking as to damages. Any damages that might have been awarded in respect of the orders of 11 February 2009 (granted only until 13 February 2009) were likely to be modest. Whilst it is true that Mr King had settled an affidavit on behalf of the plaintiff in October 2008 in the County Court proceeding which suggested he was a man of very limited means,[46] I do not accept that this fact (known as it might have been in October 2008) is sufficient to found an allegation that Mr King (and/or Mr Grundy) was a party to the proffering of an undertaking known to be worthless.

38 In summary, Mr King and Mr Grundy breached their duty to the Court in:

(a) failing to draw to the attention of the Court the 23 January letter;

(b) failing to draw to the attention of the Court the interlocutory findings of Judge Misso;

(d) failing to tell the Court that the Mellon Court property was purchased by the defendant (on her version) after the de facto relationship ended.

These matters cannot be excused by a contention that if the Court had been appropriately informed of the relevant facts and bases of the plaintiff's application, then the orders may have been made in any event.

Should notice have been given to the defendant of the 11 February application?

39 The defendant complains that the application for the ex parte injunction should not have been made without notice to her solicitors. Whilst reasonable minds might differ as to the correctness of this proposition, in reality little complaint could have been made had Mr Grundy and Mr King fully and fairly disclosed all material facts (including the 23 January letter). In those circumstances, the Court could then have determined whether or not to allow the matter to proceed without notice to the defendant. The real vice was in failing to fully and fairly disclose all material facts, not in making an ex parte application without notice to the defendant. It follows that this ground of complaint adds nothing to the matters in respect of which I have already made findings.

40 The defendant makes a number of related assertions concerning the motives of Mr King and Mr Grundy. First, it is asserted that Mr King and Mr Grundy "decided, without express instructions, to apply on an ex parte basis even though the plaintiff had no urgent need for possession of the property".[47] This assertion is put on the basis that the plaintiff had informed Mr King on 11 February that he was not in Melbourne. There is no reason not to accept the evidence of Mr Grundy[48] and Mr King[49] (who was not cross-examined) that they had instructions from Mr Orpen to proceed with an ex parte application. Even if this was not specifically deposed to, there is nothing in the material that suggests to me that either Mr King or Mr Grundy would commit such a gross dereliction of duty as seeking an ex parte injunction without instructions.

41 Secondly, the defendant asserts that both Mr King and Mr Grundy committed the breaches of duty alleged against them for their own personal gain.[50] These allegations relate to the possibility of Mr King and Mr Grundy being paid their fees and professional costs from moneys obtained from the defendant upon a conclusion of the matter favourable to the plaintiff. It is asserted that as a step towards achieving this end, it was necessary for Mr King and Mr Grundy to obtain an order putting Mr Orpen back into the Mellon Court property so that the defendant would have to enter into negotiations. In support of these claims, reliance is placed upon Mr Kenny's note of Mr Grundy's alleged statement that "I only stayed in the case hoping that I would be paid from a settlement. As there is not going to be a settlement, I'm not going to act". Having regard to the fact that Mr Kenny's note was made the day following the conversation of 10 February, it is unlikely that it is a verbatim account.[51] However, even if it was a verbatim account, I do not find it to be a sufficient basis for the defendant's assertion. No win/no fee litigation is commonplace in this State. A statement by a solicitor that he is only going to continue to act if there is likely to be a settlement from which his fees might be paid is generally (and in the context of this case) unexceptionable. It is not, of itself, indicative of any improper purpose on the part of the solicitor. The assertion that Mr King or Mr Grundy committed the breaches of duty I have found for their own personal gain cannot be made out.

42 Thirdly, the defendant asserts that obtaining the ex parte order "was all pre-planned and executed with reckless disregard for the defendant's legal rights".[52] There were breaches of duty to the Court in failing to disclose matters and misstating matters as I have found above. However, I do not conclude that these were "pre-planned" or "executed with reckless disregard for the defendant's legal rights". There is some strength in the assertion that had Mr King (instructed by Mr Grundy) carefully taken his Honour to all of the material (fully, fairly and accurately), the plaintiff may still have achieved the orders ultimately made on 11 February. Whilst what actually occurred on 11 February might be described as gross negligence or dereliction of duty, I am not prepared to conclude there was any reckless disregard of the defendant's legal rights. In particular I am not prepared to make such a conclusion in the absence of any cross-examination of Mr King.

43 In summary, I do not conclude that the breaches of duty I have identified above were committed with any improper motive or any deliberate intent.

44 The defendant makes complaint concerning Mr Grundy's refusal to attend Court on 12 February 2009. The complaint is made in circumstances where it is alleged Mr Grundy knew that the Court would not learn of the matters which had not been disclosed until after the defendant was required to comply with the order of 11 February delivering up a set of keys. Ordinarily, a solicitor's failure to accede to a request by his opponent that he attend the Practice Court (without any order from the Court) would not be exceptionable. In this case, it is put that the solicitor (Mr Grundy) well knew that matters had not been disclosed to the Court and therefore should have consented to returning (or perhaps extending the time for compliance with the order for delivery up of a set of keys).

45 However, the ordinary remedy for a party who cannot procure the attendance of his opponent in the Practice Court is simply to go to Court and seek to be heard. This is what the defendant did. Whatever may be the effect of the non-disclosures and misstatements on 11 February, I am not prepared to conclude that the failure by Mr Grundy to go to Court on 12 February was of itself deserving of any costs order against him. Further, notwithstanding the width of the grounds on which the defendant makes her application, ultimately the only breaches of duty that have been established relate to the non-disclosures and misstatements on 11 February referred to above. It is now necessary to consider the cost consequences of these.

Costs orders against legal practitioners: the principles to be applied

46 The defendant seeks orders for indemnity costs against both Mr King and Mr Grundy pursuant to the inherent jurisdiction of the Court.[53] There is no doubt that the Court has an inherent jurisdiction to award costs against solicitors and counsel representing parties before it.[54] The jurisdiction is to be exercised with care and caution. Whilst the circumstances which might enliven the Court's jurisdiction are narrow, they include serious dereliction of duty and serious misconduct or gross negligence.[55] A serious breach of duty to the Court can enliven the Court's jurisdiction.[56] The inherent jurisdiction enables the Court to design its sanctions for breach of duty in a way that will enable it to provide compensation for a disadvantaged litigant. However, a costs order is also punitive in the sense that even though it may be expressed in terms which are compensatory, its purpose is to punish the offending legal practitioner for a failure to fulfil his duty to the Court.[57]

47 A number of the authorities concerning the question of whether costs orders should be made against barristers and solicitors refer to the caution that must be exercised because (in those cases) the Court does not, or cannot, know what the barrister or the solicitor knew or what the state of his or her instructions were. This is not such a case.[58] Both Mr King and Mr Grundy were aware of the contents of the 23 January letter. Further, both were involved in the appearance before Judge Misso and were aware of the contents of Judge Misso's judgment.[59] Similarly, both were aware of the position taken by the defendant in relation to what was said to be the underlying facts. Whilst one might be inclined to forgive a failure to remember some aspect of the facts which occurred some considerable time in the past, the application before Judge Misso, the hearing at VCAT and the 23 January letter were not such matters. They all occurred within a relatively short time frame (November 2008 to January 2009).

Should costs be ordered against Mr King and/or Mr Grundy?

48 The duty owed to the Court in relation to the full and fair disclosure of material facts in ex parte applications is of considerable (if not paramount) importance. The failure to bring to the Court's attention the 23 January letter constituted gross negligence[60] and a serious dereliction of duty on the part of Mr King and Mr Grundy. Mr King's evidence in relation to the 23 January letter was as follows:[61]

"In ordering my thoughts for the making of oral submissions I recalled the letter from Kalus Kenny to Grundy dated 23 January 2009. However, having regard to the view I had taken as to the purpose of the letter deposed to at paragraph 12 above ['a step in a strategy to seek possession of the Mellon Court property most likely by proceeding under order 53 of the rules'] and that the letter appeared to allege there was a legally binding agreement between Orpen and Tarantello, whereas, on the information I held, I took the view that it was a purely domestic arrangement and not intended to create legal relations, I did not consider the letter material to the principal issue to be submitted to his Honour on the ex parte application, namely that Orpen had an equitable interest in the property and he ought to be able to enjoy the status quo[62] of possession while that matter was being litigated."

49 Whilst I accept that Mr King (and Mr Grundy) did not dishonestly fail to bring the 23 January letter to the attention of the Court, Mr King's explanation merely highlights the breach of duty in arrogating to himself the issue of materiality.

50 There are good grounds for contending that had there been proper disclosure on 11 February, then the Court would have required the defendant to be notified before any orders were made. Indeed, I find that is what probably would have occurred. In such circumstances it is likely that the result which occurred on 13 February namely, the dismissal of the plaintiff's application, would have occurred at that time (or perhaps earlier) and the plaintiff would not have obtained a set of keys to the Mellon Court property. It follows that it is probable that had there been no breach of duty, the defendant would not have needed to issue her summons. In the circumstances, it is appropriate to order Mr King and Mr Grundy to pay the costs of and incidental to:

(a) the plaintiff's summons filed 12 February 2009 and the hearing before Pagone J on 13 February 2009; and

(b) paragraphs 1 to 3 of the defendant's summons filed 20 February 2009 and the hearings before Smith J on 25 February 2009.[63]

The issue now arises as to whether those costs (as against either Mr King and/or Mr Grundy) should be on a party/party basis, a solicitor/client basis or an indemnity basis.

Party/party, solicitor/client or indemnity costs?

51 The defendant seeks costs on an indemnity basis.[64] Mr King and Mr Grundy resisted any order for costs being made against them. However, they submitted that if I was to order costs, then those costs should be on a party/party basis.[65] No party submitted that the costs should be on a solicitor/client basis.[66] The relevant principles relating to the awarding of indemnity costs have been conveniently summarised by Sheppard J in Colgate-Palmolive Company & Anor v Cussons Pty Ltd.[67]

52 In failing to make proper disclosure on 11 February, it might be said that Mr King and Mr Grundy failed to comply with "clearly established law".[68] However, I do not find there was a wilful disregard by them of the relevant principles. Whilst what was done was a serious error of judgment on their part, I do not find it was wilful or motivated by any improper or venal purpose as suggested by the defendant. Further, whilst the breach of duty to the Court on 11 February can be causally linked to the need for the defendant to issue a summons to effectively recover possession of the Mellon Court property,[69] the objects of punishment[70] and compensation are sufficiently satisfied by the ordering of costs in respect of the matters I have referred to above on a party/party basis. Taking all of the matters into account (including the appearance of Mr Grundy during the course of his evidence and the failure to cross-examine Mr King to put to him the more serious allegations - which I have found not to have been made out), in my judgment the appropriate order for costs is a party/party order.

53 For the reasons given above, there will be an order that Mr King and Mr Grundy pay the defendant's party/party costs of and incidental to:

(a) the plaintiff's summons filed 12 February 2009 and the hearing before Pagone J on 13 February 2009; and

(b) paragraphs 1 to 3 of the defendant's summons filed 20 February 2009 and the hearings before Smith J on 25 February 2009.

54 Whilst the defendant has obtained orders for costs against Mr Grundy and Mr King, a number of very serious allegations made by the defendant have not been made out. In the circumstances, I will hear the parties on the question of the costs of this application.[71]

[1] See ground 6 of the defendant's document headed "Statement of grounds of application by the defendant against the non-parties", which sets out the detail of the defendant's complaint against the non-parties.

[2] Although, ultimately, the defendant expressed an intention to rely on the same matters vis-à-vis Mr Grundy (noting that the first line of ground 7 contains the words "instructed by Mr Grundy").

[3] Five sub-paragraphs of particulars of this ground of complaint (ground 7) are given, one of which (ground 7(e)) is divided into a further six parts.

[5] Specifically, the order for delivery up of a set of keys, about which I will say more below.

[7] In paragraph 11 of his affidavit of 20 February 2009.

[8] The application had to be brought within two years after the day on which the relationship ended (s 282(1) of the Property Law Act).

[9] See Judge Misso's judgment at paragraphs [40] and [41].

[11] Mr Grundy had attempted to contact Mr Kenny after he received the letter of 10 February, but was told Mr Kenny was unavailable. The conversation occurred when Mr Kenny returned Mr Grundy's telephone call.

[14] Described as a contemporaneous note in his affidavit of 12 February 2009 (this evidence was corrected by Mr Kenny in his evidence-in-chief at T77 so as to disclose that the note was made on the evening of 11 February). Whilst Mr Kenny was cross-examined as to why he did not correct the wrong assertion in his affidavit of 12 February that his note was "contemporaneous" until he gave evidence on 3 April (the suggestion being that he should have corrected this matter earlier - and at least by the time he swore his affidavit of 16 March 2009) and whilst I was invited to view this matter unfavourably so far as Mr Kenny's credit was concerned, I do not find this matter to be determinative against the acceptance of Mr Kenny's evidence. The question will ultimately be whether Mr Kenny's evidence in respect of this conversation leads to any finding adverse to Mr Grundy - about which I will say more below.

[16] T1.14 of the transcript of 11 February.

[17] T1.16 - T1.25 of the transcript of 11 February.

[18] T1.27 - T3.9 of the transcript of 11 February.

[19] T3.22 - T4.9 of the transcript of 11 February.

[20] T4.18 - T4.30 of the transcript of 11 February.

[21] T6.17 - T6.20 of the transcript of 11 February.

[22] At T6.23 - T6.30 of the transcript of 11 February.

[23] T7.4 - T7.6 of the transcript of 11 February.

[24] T10.14 - T10.26 of the transcript of 11 February.

[26] See paragraph 14 of Mr Kenny's affidavit of 20 February 2009 and note the lack of any dispute as to these matters in paragraph 31 of Mr King's affidavit of 10 March 2009.

[27] The circumstances of this are set out in paragraphs 3 to 7 of the affidavit of Mr Marcus Walkom sworn 6 April 2009 (Exhibit 2).

[28] T29.5 and T29.16 of the transcript of 13 February.

[29] See paragraph 37 of Mr King's affidavit sworn 10 March 2009.

[30] See T29.22 - T30.2 of the transcript of 13 February.

[31] T34.28 of the transcript of 13 February.

[32] T36.4 of the transcript of 13 February.

[33] T36.12 of the transcript of 13 February.

[34] The hearing commenced on 3 April 2009.

[35] Thomas A. Edison Limited v Bullock [1912] HCA 72; (1912) 15 CLR 679 per Isaacs J at 681-2.

[36] See generally Digital Equipment Corporation v Darkcrest Limited [1984] 1 Ch 512 at 524; Savcor Pty Ltd v Catholic Protection International APS [2005] VSCA 213; (2005) 12 VR 639 at 647; Garrard v Email Furniture Proprietary Limited (1993) 32 NSWLR 662 at 676-7; Redwin Industries Pty Ltd v Feetsafe Pty Ltd [2002] VSC 427 at paragraph [8]; Westpac Banking Corporation v Hilliard [2001] VSC 187; Lloyds Bowmaker Limited v Britannia Arrow Holdings PLC [1988] 3 All ER 178 at 181-3 and Brink's-MAT Limited v Elcombe [1988] 3 All ER 188 at 192-3.

[37] Whilst the defendant originally filed a statement of grounds in which paragraph 7 was in different terms, the application proceeded before me on the basis that if there was evidence to support the allegation in the current version of paragraph 7, then there would be no basis for refusing the defendant's application for leave to amend paragraph 7.

[38] Identified in paragraphs 12 and 22 of his affidavit sworn 10 March 2009.

[39] I do not doubt that Mr King and Mr Grundy held these views. An examination of the VCAT transcript shows the 23 January letter to be a very limited account of the way in which the VCAT proceeding was conducted and of Mr Orpen's evidence (see in particular the way in which the VCAT proceeding was opened at T15.7 - T15.15, what was put to Ms Tarantello at T48.18 - T48.30 and the evidence of Mr Orpen at T83.23 - T83.30, T89.4 - T90.15, T98.24 - T99.23, T109.15 - T109.22, T110.1 - T110.9, T111.17 - T111.22, T112.7 - T112.31, T113.13 - T113.29, T119.13 - T119.19, T131.23 - T132.27, T134.1 - T134.8, T135.8 - T135.31, T138.10 - T139.21, T145.5 - T145.25 and T154.21 - T155.7).

[42] T1.14 of the 11 February transcript.

[43] T6.14 - T6.20 of the transcript of 11 February.

[44] This was particularly so having regard to the evidence sworn by the defendant in the County Court concerning the purchase by her of the Mellon Court property (see paragraph 13 of the defendant's affidavit sworn 5 November 2008 in the County Court proceeding), which evidence was not contradicted in Mr Orpen's answering affidavit (sworn 19 November 2008).

[45] At T32.6 of the transcript of 13 February.

[46] See paragraph 15 of the plaintiff's affidavit sworn 20 October 2008.

[48] Paragraph 18 of Mr Grundy's affidavit sworn 10 March 2009.

[49] Paragraph 16 of the affidavit of Mr King sworn 10 March 2009.

[51] This is all the more likely having regard to the fact that the email sent by Mr Kenny to his client at 5.59pm on 10 February 2009 (Exhibit 1R1) did not contain any reference to this part of the conversation.

[54] Myers v Elman [1940] AC 282; De Sousa v Minister for Immigration, Local Government and Ethnic Affairs [1993] FCA 146; (1993) 41 FCR 544 per French J (as his Honour then was) at pp.547-8 and White Industries (Qld) Pty Ltd v Flower & Hart [1998] FCA 806; (1998) 156 ALR 169. See also s 24 of the Supreme Court Act 1986 and cf s 43 of the Federal Court of Australia Act 1976 as referred to in De Sousa (supra).

[55] De Sousa (supra), Levick v Deputy Commissioner of Taxation [2000] FCA 674; (2000) 102 FCR 155, White Industries (supra) and Steindl Nominees Pty Ltd v Laghaifar [2003] QCA 157; (2003) 2 QdR 683.

[56] See Harley v McDonald [2001] UKPC 18; [2001] 2 AC 678 at 704.

[58] With the possible exception of the matters raised in ground 7(e)(iii). It is not possible to conclude to the requisite standard (as asserted by the defendant) that the plaintiff did not instruct Mr King or Mr Grundy to deny the matter contained in paragraph 13 of the defendant's affidavit sworn on 5 November 2008. Nor is it possible to be satisfied that the plaintiff never gave Mr King (or Mr Grundy) instructions that he had contributed to the property (see further the affidavits of Mr Grundy sworn 30 March 2009 and Mr King sworn 27 March 2009).

[59] Even if Mr King or Mr Grundy could say that they were not aware of the specific content of Judge Misso's judgment, this is a matter in respect of which proper inquiries should have been made by them before making any ex parte application (Savcor, supra at p.650 [36]).

[60] It demonstrated a lack of understanding of basic principle or an attempt to apply basic principle which was grossly deficient.

[61] See paragraph 22 of Mr King's affidavit sworn 10 March 2009.

[62] I interpolate here that in fact the ex parte application sought to alter the status quo so as to permit Mr Orpen back into a property of which the defendant was the registered proprietor.

[63] I do not accept the argument advanced on behalf of Mr King and Mr Grundy that if I am minded to order costs against them, then those costs should not include the costs of 25 February because the defendant could have come to Court on 13 February with a summons enabling her to obtain the relief she wanted from the plaintiff on that day. In my judgment it was reasonable for the defendant to go to Court on 13 February without having issued any such summons.

I also do not accept that there is any basis for apportioning these costs between Mr Grundy and Mr King. Each breached the duty he owed the Court. The breaches were of the same order and led to the same result (the Court not having a full and proper understanding of the material facts on 11 February).

[68] See Colgate-Palmolive, supra at p.233.

[69] And thus, in one sense, there was an undue prolongation of the dispute between the plaintiff and the defendant (see Colgate-Palmolive, supra at p.233).

[71] Paragraph 5 of the defendant's summons filed 20 February 2009.

At a glance

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Before

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Judgment (172 paragraphs)

Parties

Legislation Cited (1)

Cases Cited (8)