Practice and procedure - Costs - Indemnity costs - Principles - Action untenable - Forum shopping - Conduct of action - Unreasonable insistence that witnesses attend for cross-examination - Form of order for indemnity costs

Anfrank Nominees Pty Ltd & Ors v Connell & Ors (1991) 6 WAR 271

AWA Ltd v George Richard Daniels t/as Deloitte Haskins & Sells, unreported; SCt of NSW; Library No 50271 of 1991; 8 October 1992

Brown & Ors v Talbot & Olivier [1993] 9 WAR 70

Colgate Palmolive Co & Anor v Cussons Pty Ltd [1993] FCA 536; (1993) 118 ALR 248

Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd [1988] FCA 202; (1988) 81 ALR 397

Helljay Investments Pty Ltd & Ors v Deputy Commissioner of Taxation [1999] HCA 56; (1999) 166 ALR 302

In Matter of Bond Corporation Holdings Limited (1990) 1 WAR 465

Jovetic v Stoddart & Co (1992) 7 WAR 208

Metropolitan Ambulance Service v Victoria Police (No 2) [1999] VSC 361

Quancorp Pty Ltd & Anor v MacDonald & Ors (1997) 24 ACSR 745

Quancorp Pty Ltd & Anor v MacDonald & Ors (1997) 25 ACSR 123

Unioil International Pty Ltd & Ors v Deloitte Touche Tohmatsu & Anor (1997) 18 WAR 190

1 ANDERSON J: It is, in my opinion, clear from the judgments that have been delivered at the various stages of this action that it was an untenable action. It never had reasonable prospects of success on its merits, nor was there any prospect of obtaining the main relief that was sought.

2 I am satisfied that the plaintiffs must have appreciated that this was so. I consider that there was simply an obdurate refusal to accept the obvious. There is no need to go into the details. It is, I think, sufficient to refer to my judgment after trial (Quancorp Pty Ltd & Anor v MacDonald & Ors, unreported; SCt of WA; Library No 980469; 19 August 1998) and to the judgment of the Full Court dismissing the appeal from that judgment (Quancorp Pty Ltd & Anor v MacDonald & Ors [1999] WASCA 33). I note in passing that special leave to appeal to the High Court was refused in April of this year in a hearing in which the defendants, the respondents to the application before the High Court, were not called on.

3 Ms Thompson, for the defendants, has referred to some additional matters. As she has pointed out, the choice of Western Australia as the forum for this action seems very strange. The obvious and most convenient forum, having regard for the location of the parties and their respective businesses, was New South Wales. There is no reason why the action could not have been brought in the commercial causes division of the Supreme Court of New South Wales.

4 This Court, that is, the Supreme Court of Western Australia, was, on any objective appraisal of the situation, in the least convenient forum. This gives grounds for suspicion that the plaintiffs chose this Court with a view to causing inconvenience to the defendants. This is a suspicion which is not allayed by the way in which the case was conducted. I think the plaintiffs' settlement demands were extravagant, to say the least. With respect to the trial itself, it is true, as Ms Thompson has reminded the court today, that the plaintiffs insisted that the defendants' witnesses attend from Eastern Australia, busy professional people, to give evidence which on no view could be regarded as controversial, and then hardly cross-examined them; perhaps it is more accurate to say cross-examined them for the most part briefly and in every case to no effect.

5 The three witnesses who I have in mind who fall into that category I would name as Mr Marsh, the general manager of the Australian Stock Exchange in Brisbane, who gave formal and uncontroversial evidence, after travelling here all the way from Brisbane, and who was cross-examined to no particular effect and, so far as I recall, for no particular purpose. There were two solicitors, Mr Magid and Mr McCulloch, about whom much the same kind of comment can be made.

6 I just mention these matters to reinforce the view that I have anyway reached that because the case was untenable from the outset it is an appropriate case in which to make an order for indemnity costs.

7 There is a question as to whether any indemnity costs order can or should extend to matters which are already the subject of costs orders. The prima facie position is that costs orders made in running, that is, orders made with respect to interlocutory applications, are final. The general discretion to make special costs orders after trial does not extend to modifying orders already made, in my opinion. No decided authority to the contrary has been cited to me by Ms Thompson, and so whilst I consider that indemnity costs should be awarded in respect of the trial, and generally the getting up for trial, I would not extend the order to cover matters that are already the subject of costs orders. I should say that of course an order that there be no order as to costs is a costs order.

8 I am therefore not prepared to make an indemnity order in terms of the minute of proposed orders presented by the defendants and dated 28 July 2000. I invite the parties to attempt to agree a modified minute in the light of the decision that I have given this morning. I do not suppose much drafting will be necessary, but there should be a qualification in the first paragraph of the minute, to make it clear that the indemnity costs order does not extend to modify costs orders already made.

9 The costs of the application this morning must be paid by the plaintiffs, but I do not order that those costs be taxed on an indemnity basis. They should be taxed according to the scale item appropriate to this application or applications of this kind, if there is still a scale item which covers matters such as that.

1 Subject to orders 2, 3 and 4, the plaintiffs do pay all the costs incurred by the defendants except insofar as they are of an unreasonable amount or have been unreasonably incurred, so that, subject to the above exceptions, the defendants are to be completely indemnified by the plaintiffs for their costs.

2 The order for indemnity costs shall not apply to any costs incurred in relation to interlocutory applications in respect to which orders for costs have been made, including any order that there be no order as to costs.

3 The costs of interlocutory matters referred to in order 2 shall be taxed in accordance with the scale.

4 The costs of the application for costs be the defendants in any event, to be taxed in accordance with the scale.