Proctor v Grass & Caruso

1. The Court has a discretion to order costs.[1] The discretion must be exercised judicially by reference to matters in or preceding the litigation and consideration of relevant principles about the exercise of the power, to avoid it being exercised arbitrarily or inconsistently, though they do not fetter the discretion.[2]

Is there a usual principle about costs in extension applications?

1. The High Court in Northern Territory v Sangare explained the general importance of the principle that 'costs follow the event' to exercising a costs discretion:

"A guiding principle by reference to which the discretion is to be exercised - indeed, 'one of the most, if not the most, important' principle - is that the successful party is generally entitled to his or her costs by way of indemnity against the expense of litigation that should not, in justice, have been visited upon that party. The application of that principle may be modified or displaced where there is conduct on the part of the successful party in relation to the conduct of the litigation that would justify a different outcome. For example, a successful defendant may be refused its costs on the ground that its conduct induced the plaintiff to believe that he or she had a good cause of action."[3]

1. The primacy of the principle that costs follow the event is explicable in adversarial litigation where parties by and large choose the justiciable issues in a proceeding.[4]
2. The hearing of the extension application can be seen as a product of the parties' choices: the defendants chose to raise a limitation defence in circumstances where the operative limitation period had expired; the plaintiff, in response to the defence, chose to make an extension application rather than accept the defence and abandon her claim; and the defendants, in response to the application, chose to oppose rather than consent, leading to a contest and the need for a hearing.
3. Yet a choice-based analysis must be tempered by the fact that extension applications arise where legislation enacts a limitation period for an action and a plaintiff has not brought the action before the expiry of the limitation period. Given the rationale for limitation periods,[5] the usual rule of costs following the event may not have the same force where a plaintiff needs to extend time - sometimes characterised as an indulgence, if granted - as it may in other types of litigation.
4. Each party submitted there is a general rule that where a plaintiff has succeeded in an extension application the parties' costs of the application will be costs in the proceeding. They did not refer me to any authority that supported this being a rule of general application and the limited cases they referred me to were of outcomes that were largely contrary.[6]
5. There is some support for a principle in extension applications that "ordinarily a successful applicant, who has allowed him or herself to get out of time, should pay the costs of the application unless the respondent's opposition was wholly unreasonable".[7] The rationale for this principle is that an applicant who caused, at least in part, the delay leading to the expiry of the limitation period and the need for an extension of time should bear the costs of seeking an indulgence in obtaining an extension.[8] Given the rationale for this principle, it has no application to this case for, as I found, the plaintiff did not cause or was not complicit in the delay.[9]
6. A review of the cases relating to the costs of extension applications show no rule or principle of general application.[10] While all circumstances are relevant, including those in and preceding an application, particular importance has been placed on whether the plaintiff's conduct has caused the need to apply to extend time, and whether the defendant's opposition to the application was reasonable or not.

1. The plaintiff submitted the defendants should pay the plaintiff's costs of the extension application because the plaintiff had not caused the need for an extension and the defendants' conduct in opposing the application was unreasonable.
2. I found the plaintiff did not cause or was not complicit in the delay that created the need for an extension of time.[11] Relevantly, I also found that the defendants had not materially caused the delay.[12]
3. The plaintiff was critical of the defendants opposing the extension application by claiming specific prejudice in the form of the passage of time having degraded the memories of Mr Grass and Mr Hunt, two witnesses to the incident the subject of the action (the incident). By reviewing material that was relied on in or derived from the hearing of the serious injury application, I found that while there was or was likely to have been some prejudice to the defendants caused by the delay, it was not significant, and specifically that Mr Grass and Mr Hunt had generally retained good recollections of the incident.[13]
4. The plaintiff submitted that it was or should have been clear to the defendants after the serious injury application that there was no specific prejudice caused by the passage of time degrading the memories of Mr Grass and Mr Hunt, so therefore it was unreasonable for it to have opposed the extension application on that basis. I do not accept that submission.
5. I held that s91(1) of the Evidence Act 2008 did not allow Tsikaris J's earlier findings in the serious injury application about the quality of the memories of Mr Grass and Mr Hunt to be used in the extension application for the purpose of seeking to prove the quality of Mr Grass and Mr Hunt's memories.[14] But that section does not prevent use of Tsikaris J's findings - and the existence of those findings - for other relevant purposes. This includes for the question of whether it was reasonable for the defendants to claim specific prejudice in the extension application in the way they did. In the context of Tsikaris J's findings, it was or would not have been clear to the defendants, as the plaintiff claims, after the serious injury application that there was no specific prejudice caused by the passage of time degrading the memories of Mr Grass and Mr Hunt.
6. The defendants' claim of specific prejudice was not unreasonable in the circumstances. Furthermore, the defendants efficiently argued the claim.
7. The plaintiff further criticised the defendants for submitting that a Jones v Dunkel[15] inference should be drawn against her because she had not called or put on any affidavit from her previous solicitors, Shine Lawyers. I found that a Jones v Dunkel inference should not be drawn.
8. I do not consider that the defendants' seeking an inference to be drawn was unreasonable.
9. The defendants' submission was largely reactive to the plaintiff's submissions that Shine Lawyers had a strategy to delay making a serious injury application until after the Magistrates' Court determined whether the plaintiff was a worker employed by the defendants when the incident happened. I rejected that submission by the plaintiff. As I held, even if I had drawn such an inference, it would not have had a material effect on my fact finding.[16] Put simply, the defendants' submission for a Jones v Dunkel inference was a minor and inconsequential issue in the extension application.
10. I consider the defendants' opposition to the plaintiff's extension application was not unreasonable and they conducted their opposition efficiently.

1. The defendants submitted that costs should be in the proceeding: the plaintiff had sought an indulgence in applying for an extension of time, so there was no reason to depart from what they claimed was the usual rule, costs in the cause, particularly because there was no conduct of the defendants that was unreasonable. I have dealt with the matters raised by the defendants in considering the plaintiff's submissions.

1. In circumstances where the plaintiff did not contribute to the delay necessitating the need for an extension, and the defendants' opposition to the extension application was not unreasonable, I consider that justice requires that the parties' costs of the extension application be costs in the proceeding.

1. The defendants submitted that if I ordered costs in the proceeding, I should order that the plaintiff pay the costs of the costs hearing, given this was the order proposed by the defendants before the hearing.
2. I consider the plaintiff should pay those costs. The defendants proposed the order, which the Court now makes, and the plaintiff chose not to accept it.
3. In respect of these costs, there is no reason to depart from the usual principle that costs follow the event.

Reserving the right to apply for a costs order against a non-party

1. The parties have expended considerable money on the extension application. For example, the plaintiff sought certification of Counsel's fees for about $25,000. Presumably the defendants have incurred similar Counsel's fees. Additionally, there are the solicitors' fees for each party.
2. A spectre that loomed over the extension application was the purported conduct of the plaintiff's previous solicitors, Shine Lawyers. I found the likely reason for the plaintiff's limitation period expiring was inadvertence by Shine Lawyers, though that finding was without the benefit of having heard from Shine Lawyers.[17] If this were true, it could provide a possible ground for one or both parties to seek their costs of the extension application against Shine Lawyers.
3. No party has applied for costs against Shine Lawyers, but each indicated that I should reserve the question of whether any order should be made against a non-party. If any party wishes to seek such an order it will need apply for such an order on notice to the non-party.
4. I make the following orders:

(a) the limitation period for the plaintiff's action in this proceeding is extended to 27 June 2021 pursuant to s23A of the Limitation of Actions Act 1958;

(b) each parties' costs relating to the plaintiff's application for an extension of time (except for the costs hearing on 19 November 2025) are costs in the proceeding;

(c) the plaintiff to pay the defendants' costs of the costs hearing on 19 November 2025; and

(d) the question of whether any non-party should pay the parties' costs relating to the plaintiff's application for an extension of time (including the costs hearing on 19 November 2025) is reserved.

[1] County Court Act 1958, s78A.

[2] Northern Territory v Sangare [2019] HCA 19; (2019) 265 CLR 164, [24] (Kiefel CJ, Bell, Gageler, Keane and Nettle JJ); see also, Diakou v Rouse [2019] VSCA 199, [48] (Kyrou, McLeish and Emmerton JJA).

[3] [2019] HCA 19; (2019) 265 CLR 164, [25].

[4] Berowa Holdings Pty Ltd v Gordon [2006] HCA 32; (2006) 225 CLR 364, [15].

[5] Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541.

[6] For example, the plaintiff referred me to orders made in two proceedings where the Court had ordered a defendant pay the plaintiff's costs of an extension application but there were no written reasons for the orders.

[7] Holt v Wynter [2000] NSWCA 143; (2000) 49 NSWLR 128, [121] (Sheller JA). In a Victorian case, this principle was referred to in an application for an extension of time to apply for compensation for acquired land in Michelotti v Roads Corporation (2009) 26 VR 609, 617, although the principle was not applied in the case with the Court ordering each party bear their own costs.

[8] G E Dal Pont, Law of Limitation (Lexis Nexis) 374 [18.18].

[9] Proctor v Grass and Caruso [2025] VCC 1607, [122] ("Proctor").

[10] G E Dal Pont, Law of Limitation (Lexis Nexis) 374 [18.17] - [18.22].

[15] [1959] HCA 8; (1959) 101 CLR 298.