Rahme v Benjamin & Khoury Pty Ltd

Background Facts

1. In around 2009, B&K (a firm of solicitors) and Mr Rahme entered into a costs agreement. On 5 October 2010, Mrs Rahme entered into a third party payer costs agreement whereby she agreed to assume responsibility for Mr Rahme's legal costs.
2. A costs dispute arose between B&K and both Mr and Mrs Rahme ("the Rahmes"), and an assessment was conducted.
3. On 21 July 2014, a costs assessor determined that the fair and reasonable costs payable by the Rahmes was $168,456.96.
4. On 5 September 2014, the assessed sum was registered as a judgment ("the 5 September 2014 judgment"). Mr Rahme was named as the first defendant and Mrs Rahme was named as the second defendant.
5. On 8 October 2019, the NSW Court of Appeal delivered judgment in proceedings brought by the Rahmes against, inter alia, B&K. [2] In its orders, the Court of Appeal set aside the costs agreement between B&K and Mrs Rahme, set aside the 5 September 2014 judgment as between Mrs Rahme and B&K, and ordered that all sums paid by Mrs Rahme be reimbursed.
6. Despite the order made by the Court of Appeal on 8 October 2019 relieving Mrs Rahme of any relevant liability for costs, on 9 September 2020, both the Rahmes filed a Notice of Motion ("the original motion") seeking to set aside the 5 September 2014 judgment. An affidavit of Michael Soulos sworn 16 December 2020 was filed in support of the original motion.
7. Submissions (dated 16 December 2020) in support of the original motion were filed by "Michael Soulos, Solicitor for the defendants". The submissions included the following: "The simple basis on which they seek that relief is that the relevant costs agreements between them and the plaintiff, which founded the Certificates of Determination dated 3 September 2014 and, in turn, the deemed judgment entered on 5 September 2014, was set aside by the Court of Appeal on 30 August 2019 ([Rahme v Benjamin & Khoury Pty Ltd (2019) 100 NSWLR 550]; [2019] NSWCA 211) on the ground that entry into [it] by the second defendant, Dana Rahme ('Dana'), was procured by a breach of fiduciary duty owed by the plaintiff, Benjamin & Khoury Pty Ltd ('B&K'), to Dana. Accordingly, the contractual basis for liability for costs supporting the Certificate of Determination and, in turn, the deemed judgment which gave effect to it as a deemed judgment debt, ceased to exist on 30 August 2019, that is, 5 years after the deemed judgment was entered following the registration of the Certificates of Determination."
8. Also included in the submissions was the following: "These proposed orders of the notice of motion should be made without prejudice to B&K's right to file a fresh Application for Assessment of Costs against Gabriel, as the sole costs respondent, founded on the superseded costs agreement to which he alone was liable for costs as B&K's client. […] B&K should be ordered to pay the Rahmes' costs of their notice of motion filed on 9 September 2020."
9. B&K filed submissions on 12 March 2021 which were stated to be "for hearing on 25 March 2021". (I note that at some point the 25 March 2021 hearing was vacated). Included in these submissions at [4] was the following: "The application also appears to be made, quite inexplicably, on behalf of the second defendant, who has the benefit of orders from the New South Wales Court of Appeal. Insofar as it concerns her, the Application achieves nothing."
10. Mr Soulos, on behalf of the Rahmes, filed submissions in reply on 17 March 2021, which included the following at [3] - [4]: "The contention in OSR [Outline of the Submissions of the Respondent] par 4 about this application achieving nothing for the second defendant, Mrs Dana Rahme ('Mrs Rahme'), is quite misconceived. Her complaint, and it is the principal (but not the only) complaint made, is that, orders by the Court of Appeal set aside on appeal the (2014) Judgment as against her on 8 October 2019 […] for the reasons given by that Court on that date […] The judgment had been entered on 5 September 2014 […] pursuant to a Certificate of Determination of Costs dated 3 September 2014 […] and an Application to Register it which was filed on 5 September 2014 during the 30-day period permitted for a review to the Review Panel […] It was set aside on appeal against Mrs Rahme but left intact as against Mr Gabriel Rahme ('Mr Rahme'). However, the plaintiff, Benjamin & Khoury Pty Ltd ('B&K'), is seeking to bankrupt Mr Rahme on a Judgment entered against two defendants which pre-dates orders setting it aside albeit without prejudice to the right of B&K to apply to enter the Certificate of Determination as against Mr Rahme as the sole judgment debtor." (Emphasis in original.)
11. Mr Soulos' submissions on behalf of the Rahmes further included the following at [18] - [19]: "The contention in OSR 21 about the Costs Agreement being set aside only against Mrs Rahme on appeal and criticising the Rahmes for suggesting otherwise in chief is quite misconceived. It is common ground that the Court of Appeal only set aside the retainer of B&K by Mrs Rahme and left intact the retainer of Mr Rahme of B&K. […] However, that limited nature of the orders setting aside her retainer of B&K and Costs Agreement does not address the joint complaint in pars 14-15 above that Mr Rahme is being left to pay costs assessed as fair and reasonable which were incurred, and could logically only have been incurred, by Mrs Rahme whose retainer and Costs Agreement were unequivocally set aside. As explained in par 15 above, the net result is that B&K are seeking to bankrupt Mr Rahme on a judgment for costs which involves him in effectively reimbursing B&K for the damages which are payable by it to Mrs Rahme for costs wrongly billed to her in respect of legal services rendered to her alone, for which Mr Rahme received no benefit, under his separate antecedent retainer of, and Costs Agreement with, B&K." (Emphasis in original.)
12. On 29 June 2021, a letter was sent by Mr Soulos to B&K's solicitors in the following terms: "We enclose by way of service an Amended Notice of Motion which was filed online today. The forensic effect of the amendments is to remove Mrs Rahme as an applicant to the Motion and to make her the second respondent to the Amended Motion. We expect her to file a submitting appearance to the Amended Motion. A reconsideration of the applicable rules in the UCPR [Uniform Civil Procedure Rules 2005 (NSW)] and the terms of the orders of the Court of Appeal has convinced us that the only relief available to be granted on the Motion is to Mr Rahme so that he is the only appropriate applicant in the Motion. Because Mrs Rahme is a party to the underlying proceeding and the deemed judgment obtained against her and her husband by your client under rule 36.10, she necessarily must be joined as a respondent to the Amended Motion in order to bind her to the relief claimed in [the] Amended Motion. Please substitute the Amended Motion for the Motion in your copies of the Court Book. We do not see any costs consequences flowing from this amendment because your client has incurred costs to date as against Mr Rahme which he would have incurred irrespective of whether Mrs Rahme was a co-applicant in the Motion with her husband, Mr Rahme. Nevertheless, any questions of costs arising from the amendment to the Motion can be dealt with at the conclusion of the hearing of the Amended Motion on 24 August next [sic] after the presiding judge has become apprised of the history of the matter." (Emphasis in original.)
13. The Court rejected the filing of the amended motion on 29 June 2021. The Principal Registrar wrote to Mr Soulos stating the document was returned as he needed a court order to amend the motion.
14. On 2 July 2021, Mr Soulos wrote to the solicitors for B&K informing them that the Amended Notice of Motion was rejected by the Registrar, requesting their formal consent to allow the motion to amend to be "resubmitted with costs to be reserved or an agreement that B&K consent to our client amending the Notice of Motion, to avoid the cost and inconvenience of having to prepare for the hearing on the basis of the original motion, at the commencement of the hearing on 24th August 2021." A response was sought by 12 noon on Tuesday 6 July 2021.
15. On 21 July 2021, Mr Soulos contacted the Registry by email, still attempting to file the Amended Notice of Motion, and the document was finally effectively filed on 5 August 2021. The email concluded with the following: "Any costs arising from the amendment to the Motion can be dealtwith [sic] at the conclusion of the hearing of the Amended Motion on 24 August 202[1], after the presiding judge has become apprised of the history of the matter."
16. An email from the Registry sent on 2 August 2021 (apparently the final email in a series of emails) asked Mr Soulos "Please direct my attention to the leave granted for the filing of such [Amended Notice of Motion]?"
17. On 7 August 2021, an affidavit was sworn by Mr Soulos (although the copy before me has no filing date) stating: "I am the solicitor for Gabriel Rahme and Dana Rahme, the Defendants in these proceedings in relation to a Notice of Motive [sic] filed on 24th June 2020 [sic] that is set down for hearing on 24th August 2021. I am also the solicitor on the record for Gabby Rahme on whose behalf I filed a Notice of Motion listed with the hearing 12th August 2021. I am also the solicitor on the record for the Defendants on whose behalf I filed a Notice of Motion to vacate the hearing date set down for 24th August 2021 for which this affidavit is being filed in support."
18. The affidavit went on to detail injuries Mr Soulos had sustained as a result of a bike accident, and indicated that he was in constant pain, unable to walk without pain, or drive. He stated that he had surgery booked on 18 August 2021 and attached a medical certificate in relation to the surgery. He indicated he should be fully recovered by 1 October 2021. The affidavit continued: "I have acted for the Defendants since 2004 in numerous matters. I have been involved and acted for the Defendants at various times in relation to the matters involving the Defendants, Benjamin & Khoury Pty Ltd, including the matters before the Court on 24th August 2021. In relation to the matter before the Court on 24th August 2024, I am the person who is fully aware of the facts and documents in the case superior to that of our Counsel, Mr Christopher Bevan who insists on an instructing solicitor and had the carriage of the matters since before the Notice of Motion was filed in June 2020. Kosta Green of my office was to have the carriage of this matter, however since April 2020, Mr Green has only been able to come to Sydney from his home in Queensland on three occasions for work and [to] see his mother due to COVID and personal health issues. Since April last year there have been and are COVID restrictions on one or both sides of the border. Before COVID Mr Green spend [sic] on average at least a week a month is Sydney. We have no employed solicitors and Mr Green is stuck in Queensland and not familiar with the matters before the Court. I wish to move the Court to vacate the hearing date with costs reserved to a date later in the year mutually conveniently to all parties after September 2021."
19. On 8 August 2021, Mr Soulos swore and filed an affidavit setting out some of the history of the matter, stating, inter alia: "I am the solicitor for the Applicant in the Notice of Motion, Gabriel Rahme, and also the solicitor on the record for the Second Defendant in the Notice of Motion seeking the principal relief filed on 9th September 2020."
20. On 12 August 2021, Cavanagh J (sitting as the Common Law Duty Judge) delivered an ex tempore judgment on a Notice of Motion filed on 9 August 2021 by the "defendants" (listed as Mr Rahme as the first defendant and Mrs Rahme as the second defendant) seeking that the hearing commencing on 24 August 2021 be vacated and the matter be allocated for hearing at another time. [3] The reason for the application was the knee surgery scheduled for Mr Soulos (described as the solicitor for the defendants), although it was also noted that Mr Soulos would likely be at home by the time of the hearing. The aspect of the matter for hearing on 24 August 2021 is recorded by Cavanagh J as "a motion to set aside a judgment obtained by the plaintiff against the defendants." The judgment records: "That motion was filed by the defendants as long ago as 9 September 2020. The motion was originally listed before Harrison AsJ on 25 March 2021 but that hearing date was vacated. I understand that it was vacated for a variety of reasons, although I am not sure what those reasons are."
21. Cavanagh J refused the application for vacation of the hearing date and dismissed the motion.
22. Not included as part of the judgment tendered before me, but recorded as part of the JusticeLink records which are before me, Cavanagh J also made an order effectively permitting the amendment of the motion removing Mrs Rahme as an applicant, as well as the following order concerning the costs of the amendment ("Cavanagh J's costs order"): "4. I further order that the question of any costs thrown away by reason of the amendment to the Motion, if any, be stood over for determination on the conclusion of the hearing of the motion on 24 August 2021." (Emphasis added.)
23. On 24 August 2021, Harrison AsJ heard the Amended Notice of Motion and judgment was reserved.
24. On 13 October 2021, Harrison AsJ delivered judgment dismissing the Amended Notice of Motion. [4] Her Honour made the following orders: 1. The first defendant's [Mr Rahme's] amended Notice of Motion filed 5 August 2021 is dismissed. 2. The first defendant is to pay the plaintiff's costs on an ordinary basis, if the plaintiff does not seek an alternative order from the Court within 7 days. If the plaintiff does seek an alternative order I will give directions for the filing of written submissions.
25. On 20 October 2021 at 6:47pm (that is, within 7 days of the above order, albeit outside business hours), B&K emailed the Associate of Harrison AsJ and sought an alternative costs order (the variation application). That email was copied to the solicitor, Mr Soulos, who was still apparently on the record as acting for both Mr and Mrs Rahme. Despite the confined nature of the order made by Cavanagh J on 12 August 2021 being "any costs thrown away by reason of the amendment to the Motion, if any," the alternative order sought was more general, and was in the following terms: 1. Order that the first and second defendants pay the plaintiff's costs of the application on the ordinary basis until 5 August 2021. 2. Order that the first defendant pay the plaintiff's costs of the application on the ordinary basis after 5 August 2021.
26. On 9 November 2021, Mr Rahme was made bankrupt by way of a debtor's petition filed by him, with the Certificate of Appointment of Trustee showing the appointment of his trustee on that date to be Thyge Howard Trafford-Jones.
27. On 23 December 2021, B&K received by post, from the solicitors for Mrs Rahme, three statutory demands relating to costs orders for $186,339.84, $393,108.08 and $81,441.17 respectively. In an affidavit filed in the Federal Court of Australia sworn on 12 January 2022 for B&K, it was stated that there was a genuine dispute in relation to each of the amounts in question, and further stated the following: "Fourth, B & K has an offsetting claim against Dana Rahme in the following circumstances. On 9 September 2020, an application was made by Dana Rahme and Gabriel Rahme in Supreme Court of NSW proceedings 2014/00262387. The parties prepared for hearing which was listed for 25 March 2021, but was vacated. On 5 August 2021, Dana Rahme withdrew her application. On 13 October 2021, judgement was given on that application by the Supreme Court of NSW (Harrison Ass J) in Benjamin & Khoury Pty Ltd v Gabriel Rahme and Dana Rahme [2021] NSWSC 1302, copy at Annexure WK6. The Court dismissed the motion filed by Gabriel Rahme and Dana Rahme (but later withdrawn by Dana Rahme) and ordered costs against Gabriel Rahme in favour of B & K. B & K has filed an application for variation of the costs order seeking Dana Rahme be made jointly and severally liable for the costs incurred in the period she was a party to that motion. Copy of Application at Annexure WK7." (Emphasis in original.)
28. On 15 March 2022 at 12:07pm, B&K sent a second email to the Associate of Harrison AsJ. That email was, again, copied to Mr Soulos. The terms of that email were: "We refer to Order 2 of Her Honour's Orders made on 13 October 2021 in proceedings 2014/262387, and to our below correspondence [dated 20 October 2021] for the plaintiff seeking an alternative costs order. Kindly advise if Her Honour requires anything further from the parties."
29. In Mr Soulos' affidavit sworn 11 April 2022, whilst he states that he received the email from B&K dated 15 March 2022 requesting that Harrison AsJ address the question of costs and requested a timetable, he qualifies this by stating: "I was in a Family Law matter before His Honour, Judge Dunkley, in the Federal Circuit and Family Court of Australia at Parramatta between 16th and 18th March 2022. There was no WiFi internet access to the public in the building housing the Federal Courts at 1 George Street Parramatta. I was unaware [of] any timetable or listing."
30. It can be observed that this does not explain why the email was not seen on 15 March 2022 (which was a Tuesday) or indeed before or after court (if indeed that is what was intended to be conveyed). It is also of note that Mr Soulos states in his affidavit of 11 April 2022 that if he had been aware of a hearing on 16 March 2022, he "would have taken steps to obtain instructions from Dana Rahme".
31. On 16 March 2022, Harrison AsJ delivered a short judgment making the alternative orders proposed by B&K on 20 October 2021. [5] It is conceded that Mrs Rahme had not been invited to make submissions in response to B&K's submissions.
32. On 27 March 2022, Mr Soulos emailed B&K's solicitors complaining about the email sent on 15 March 2022 to Harrison AsJ, stating that it was "unprofessional conduct to communicate with a judicial officer without the consent of all other parties to the proceeding"; contending that it was "professional misconduct" that the email "was never sent to Mr Gabriel Rahme, the first defendant, who has been self-represented in the proceeding since his bankruptcy last year"; stating that "as far as we are aware" Harrison AsJ is functus officio in this proceeding; and stating that "my firm's client, Mrs Dana Rahme, reserves the right to bring this regrettable conduct of […] the responsible legal practitioner, in this matter to the attention of the Legal Services Commissioner in due […] course." B&K's solicitors responded on 29 March 2022 denying the allegations and stating, "You and your firm have always been copied into all correspondence with the Court."
33. It is conceded that Mrs Rahme was not sent the email.
34. Mr Soulos also indicates in his affidavit of 11 April 2022 that he was not aware of the 16 March 2022 costs order until 4 April 2022 following receipt of an affidavit filed on behalf of B&K in the Federal Court proceedings, which (apparently) caused him to conduct a search of his email. He stated the email was not in his inbox. The implication is that the email from the Associate of Harrison AsJ was somewhere in his junk email.
35. On 12 April 2022, Mrs Rahme filed the appeal motion seeking to set aside the 16 March 2022 costs order. In an email of that date to B&K's solicitors from Mr Soulos, he stated that he was filing the appeal motion "on behalf of Dana Rahme who has reinstructed us to act on her behalf in this matter." Mr Soulos filed an affidavit in support, sworn 11 April 2022.
36. Included in that affidavit at [17] was the following statement: "When the matter was before Justice Cavanagh on 12th August 2021, for the purpose of hearing an application by the first defendant, Gabrielle rani [sic], to vacate the hearing of the amended notice of motion on 24 August 2021, his Honour ordered that the second defendant, Dana Rahme, cease to be a party resulting in Gabriel Rahme becoming the sole applicant in the amended notice of motion going forward and I ceased to act as the solicitor for the second defendant, Dana rani [sic] in the proceedings because she had ceased to become a party to it with effect from 5 August 2021 as confirmed by Justice Cavanagh on 12 August 2021."
37. As to that statement, it can be observed that it is incorrect on its face given that whilst Mrs Rahme ceased to be an applicant in the motion, she was still a "party" given that she was the "second respondent".
38. On 26 April 2022, B&K's solicitors wrote to Mr Soulos. In that letter, it was contended that an appeal properly lay to the Court of Appeal (albeit only if leave was granted). It appears that this issue is no longer a live one so the arguments included in this letter in relation to this issue will not be further set out.
39. The letter continued, effectively acknowledging that Mrs Rahme was erroneously denied an opportunity to make submissions in response to B&K's submissions dated 20 October 2021 and proposed the following compromise in order to dispose of this "wasteful satellite litigation": "In view of all the foregoing, to save time and expense for all parties concerned, and without making any admissions, we propose that the most efficient way to proceed is for consent orders to be made that the question of whether an alternative order to an order that the first defendant pay the plaintiff's costs of the amended notice of motion filed 5 August 2021 be remitted to Harrison AsJ for redetermination."
40. In a further letter from B&K's solicitors to Mr Soulos dated 3 June 2022, they stated: "For the avoidance of doubt, our client's position is that [Mrs] Rahme should have been invited to make submissions in response to our client's submissions dated 20 October 2021, but that the decision made by Harrison AsJ was in any event correct."
41. It further noted that the procedural issue identified in their letter dated 26 April 2022 had not been satisfactorily responded to, and continued: "In his affidavit dated 11 April 2022, Mr Soulos states at [17] that he ceased to act for Dana Rahme on or around 5 August 2021. There is no documentary evidence to support that statement. Please include any such evidence in the Court Book, including any notice filed with the Court under Division 7 of Part 7 of the Uniform Civil Procedure Rules. We further note that the position adopted by Mr Soulos in his affidavit at [17] is inconsistent with the fact that Mr Soulos acts for [Mrs] Rahme on the Motion. It appears to us that Mr Solous has in fact been acting for [Mrs] Rahme at all material times in respect of the Proceedings."
42. A further letter dated 15 September 2022 providing a proposal for the resolution of the dispute was sent by B&K's solicitors to Mr Soulos, proposing that the 16 March 2022 costs order be set aside by consent, the question of an alternative costs order be reopened and redetermined by Harrison AsJ and a timetable be set for submissions.

Core issues for determination

1. Mrs Rahme relies on many grounds of appeal, which I will deal with below. However, it is worth recording the core issues which appear to emerge as the key issues for determination. 1. First, were there any costs incurred by B&K which were more than de minimis as a result of Mrs Rahme's misconceived claim, that is, being named as a joint applicant in the original motion, with her role as joint applicant being discontinued on 5 August 2021. In my view, it can be reasonably inferred on the basis of the evidence before me that the answer is yes. 2. Was the new unquantified costs order made on 16 March 2022 sought for the "ulterior purpose" of being available to be set-off by B&K against the quantified judgment debts entered against it for unpaid damages and costs that had been awarded against B&K. I am of the view that a simple consideration of the chronology does not permit this inference to be made. 3. Leaving aside the conceded lack of opportunity to make submissions, given the confined nature of Cavanagh J's order, was it appropriate (assuming the requisite power) for Harrison AsJ to make the 16 March 2021 costs order. I am of the view that it was not, and that a more confined order should be made instead.
2. As indicated above, although a jurisdictional issue was raised in the course of correspondence in the lead up to the hearing, I understand it is no longer pressed and I will not deal with it further.
3. It is convenient now to turn to the 14 grounds of appeal. In written submissions on behalf of Mrs Rahme, the 14 grounds of appeal are addressed in 5 separate categories, and B&K have also approached the grounds in this way. Accordingly, the same approach will be taken by me.

Nature of the appeal before me

1. The matter the subject of the appeal was not the subject of a hearing before Harrison AsJ, but rather was done on the papers. The evidence put before me to found the basis of my decision on appeal was agreed. The agreed material included material which was not before Harrison AsJ. I accept that the appeal is a hearing de novo, and it is appropriate for me to consider the agreed material put before me.

Appeal grounds 3, 8, 9, 10 and 12 (First appeal issue)

1. The first appeal grounds concern, in one way or another, the denial of procedural fairness to Mrs Rahme. Although only Mrs Rahme is the applicant on the appeal motion, Mrs Rahme also raises issues which go beyond her position and point to the alleged denial of procedural fairness to Mr Rahme's trustee in bankruptcy and "jurisdictional error in respect of identity of parties". The rather lengthy appeal grounds for the first appeal issue are as follows: Ground 3: "Her Honour erred at [3] by finding that the first defendant did not make submissions in response to the application to vary the costs orders without turning her mind to the objective facts, firstly, that the principal respondent to that application was, as her Honour found at [5], the second defendant (as the application sought to impose a new liability for costs upon the second defendant), secondly, that the second defendant had been excused from any further participation in the proceedings by Cavanagh J on 12 August 2021 when she was released from the proceeding, thirdly, the second defendant had not been served with the application to vary the costs orders that was effectively made on 21 October 2021 by email, and fourthly, that the then solicitor for the first defendant had in fact ceased to act for him on 7 November 2021 when he was declared bankrupt following service of a creditor's petition on him by the plaintiff as judgment creditor for the relevant assessed costs." Ground 8: "Her Honour erred by failing to appreciate that the variation application was served upon the solicitor for the first defendant but not upon counsel for the first defendant who had conducted the hearing in person before her Honour, and that it was not served upon his trustee in bankruptcy or upon the second defendant, so that the variation application could only be entertained if her Honour was prepared to vary her grant of leave to permit the application to be made late and also on an ex parte basis without any notice to the first defendant's former counsel or his trustee in bankruptcy or the second defendant, as the principal respondent to the application." Ground 9: "Her Honour erred by denying the second defendant, as the principal respondent to the variation application, procedural fairness in the determination of the application by determining the variation application without any notice to the second defendant." Ground 10: "Her Honour erred by denying the first defendant, as a respondent to the variation application having a legitimate forensic interest in its outcome, procedural fairness in the determination of the application by permitting the application to be made on 21 October 2021 without notice to the first defendant's trustee in bankruptcy and by assuming that notice to the first defendant's former solicitors prior to his bankruptcy was adequate notice to the first defendant for the purposes of procedural fairness." Ground 12: "Her Honour otherwise fell into error in her response generally to the variation application, and in her determination of that application on the merits six months after it was made, including when the variation application first came to her attention on the morning of 21 October 2021 and when it was renewed by the some [sic] six months later, on 15 March 2022, again without notice to the second defendant or to the first defendant's trustee in bankruptcy, by denying each of the defendants procedural fairness in respect of its determination by her Honour on the papers."

Mrs Rahme's submissions in relation to the First appeal issue

1. Mrs Rahme contends that she ceased to be a party to the deemed proceeding created by the filing of the Certificate of Determination, which occurred to register it as a judgment of this Court on 5 September 2014, upon the making by the Court of Appeal of its order on 8 October 2019 setting aside, as against her, the registration judgment.
2. Mrs Rahme acknowledges she became a party to the original motion filed to set aside the registration judgment but contends she ceased to be a party from 29 June 2021 when she served the amended motion (albeit leave to file the amended motion was not provided until 12 August 2021).
3. Mrs Rahme contends that Harrison AsJ denied her procedural fairness - which was "compounded by the complete invalidity of any proceedings against Mr Rahme in respect of any relief being determined by her Honour after 9 November 2021 without a grant of leave from the Federal Court of Australia".
4. Mrs Rahme argues that B&K's submission that Mrs Rahme was still represented by her solicitor on the record, Mr Soulos, is untenable. Mrs Rahme argues that Mr Soulos' affidavit of 5 August 2021 states he ceased acting for Mrs Rahme on 5 August 2021. Mrs Rahme also argues that neither Mr Soulos nor counsel appearing for Mr Rahme could have acted on both sides of the record.
5. Mrs Rahme argues that given Mr Rahme's bankruptcy on 9 November 2021, it is contended that B&K only had "two viable options available to it […] as the costs applicant in the original costs order made on 20 October 2021 [sic: should be 13 October 2021]" against Mr Rahme: "(a) accept the original costs order against Mr Rahme made 20 October 2021 [sic: should be 13 October 2021] and prove for it in Mr Rahme's bankruptcy under s. 84 of the Bankruptcy Act; or (b) apply for and obtain leave of the Federal Court under s. 58(3) of [the] Bankruptcy Act to make its variation application to the Associate Judge after serving that application on Mrs Rahme and on Mrs [sic: Mr] Rahme's trustee…and fulfilling any conditions for the grant of such leave by the Federal Court, such as those ordered in [Stojanovski v Stojanovski [2018] FCA 580] for a proceeding in this Court." (Emphasis in original.)
6. In short, Mrs Rahme contends that B&K had no right to make any ex parte application to vary the original costs order on 20 October 2021, or again on 15 March 2022, without notice to Mrs Rahme or the trustee in bankruptcy of Mr Rahme and without the leave of the Federal Court. This combination of denials of procedural fairness and lack of jurisdiction are fundamental errors of law.

B&K's submissions in relation to the First appeal issue

1. B&K state there are two elements to these appeal grounds: 1. Mrs Rahme was not party to the proceedings or the motion after 5 August 2021; and 2. Relief was not available against Mr Rahme because he had been made bankrupt on 9 November 2021.
2. They contend that neither of those propositions are soundly based.
3. It is submitted that Mrs Rahme was a party to the 16 March 2022 costs order as: 1. She was an applicant on the motion from 9 September 2020 to 5 August 2021; 2. After 5 August 2021, she was a respondent on the motion; 3. The amended Notice of Motion filed 5 August 2021 provides: "NOTICE TO PARTIES AFFECTED BY THE MOTION: If you do not attend, the court may hear the application and make the orders sought in this notice of motion. The court may make orders for the payment of costs." 4. After 5 August 2021, Mrs Rahme was still represented by her solicitor on the record, Mr Soulos. On 8 August 2021, Mr Soulos said on oath: "I am the solicitor on the record for the Applicant in the Notice of Motion, Gabriel Rahme, and also the solicitor on the record for the Second Defendant in the Notice of Motion seeking the principal relief filed on 9th September 2020." 5. Mrs Rahme was expressly subject to a potential costs order by Order 4 made by Cavanagh J on 12 August 2021. That order was made in view of the express contention by Mrs Rahme's solicitor, by letter dated 29 June 2021, that questions of costs arising from the amendment to the motion should be dealt with at the conclusion of the hearing.
4. B&K further contend that the "underlying fallacy as regards Mr Rahme is that the orders affect him." B&K submit that they do not. Whether or not a costs order is made against Mrs Rahme, Mr Rahme is liable for the full amount of costs. The possibility that some of his liability is joint with Mrs Rahme does not affect his position as against B&K. His creditors stood to benefit from an order making Mrs Rahme jointly liable for part of his debts.

Consideration of the First appeal issue

1. The First appeal issue concerns in part an allegation regarding lack of service of the variation application and lack of notice given by Harrison AsJ to either Mrs Rahme or Mr Rahme's trustee in bankruptcy before making the 16 March 2022 costs order. Given the lack of notice to Mrs Rahme to make submissions prior to the making of the 16 March 2022 costs order which affected her is properly conceded by B&K, it is unnecessary to deal further with the first part of this argument. As to whether Mr Rahme's trustee in bankruptcy needed to be given notice, I am of the view that it is not clear that s 58(3)(b) of the Bankruptcy Act 1966 (Cth) is enlivened in this case, that is whether the submissions as they affected Mr Rahme in truth were a "fresh step" in the proceedings against him. Indeed, it would appear if it were the case that a costs order to be made in relation to Mrs Rahme in this matter could be seen potentially to constitute a "fresh step" it would have been appropriate for Mrs Rahme to join Mr Rahme's trustee in bankruptcy in the hearing of the appeal motion, but such a course has not been considered appropriate.
2. It is alleged further that Mrs Rahme was no longer a party to the proceedings or the motion after 5 August 2021. Given the lack of notice to Mrs Rahme has been conceded by B&K, this point has little work to do, but in any event, this contention cannot be made out. The documentation comprising the amended Notice of Motion filed in the Court on 5 August 2021 (which contains some errors on its face, it is noted) still can be seen to be filed for "Gabby Rahme, First Defendant" and shows, amongst other things, the following: 1. B&K is listed as the plaintiff; 2. Mr Rahme is listed as the first defendant, and Mrs Rahme is listed as the second defendant; 3. Further down the page, under the heading "Persons to be served", B&K is listed as the first respondent and Mrs Rahme is listed as the second respondent; 4. Under the heading "Orders Sought", it is apparent that the document has been amended with certain underlining indicating alterations from a previous version with the current version reading "The First Defendants" (previously "The Defendants") will move the Court for orders that [etc]"; 5. On the third page, it can be seen that "and Dana" has been crossed out; 6. Mr Soulos is listed as the "applicants' legal representative" and he is listed as agreeing to electronic service; and 7. Under the heading "Respondents" - Mrs Rahme is listed as the second respondent and her name and street address are given.
3. This, together with the matters noted above, make it clear that Mrs Rahme was still a party to the proceedings from 5 August 2021, albeit no longer as an applicant, but as second respondent. In any event, it is clear that Mrs Rahme should have been invited to make written submissions prior to the 16 March 2022 costs order. To the limited extent that the First appeal issue raises the lack of opportunity to make submissions prior to the 16 March 2022 costs order, as conceded by B&K, the appeal grounds are made out. It must be noted, however, that in the course of having to deal with this clear conceded issue, wordy and unnecessarily complex appeal grounds were raised. This is regrettable.

Appeal grounds 1, 4, 5 and 6 (Second appeal issue)

1. These grounds are said by Mrs Rahme to go to an error in misconstruing and misapplying the reservation of jurisdiction over costs made by Cavanagh J on 12 August 2021 - grounds 1, 4, 5 and 6. These read as follows: Ground 1: "Her Honour erred at [9] by finding that the orders she made on 16 March 2022 were the costs as reserved by Cavanagh J on 12 August 2021 (namely, the costs thrown away by the amendment made on 5 August 2021, as Her Honour correctly found at [5]) whereas her Honour instead ordered that all costs incurred by the plaintiff from the filing of the original motion up to the date of amendment (5 August 2021) be paid by the defendants jointly and severally, thereby imposing a liability for costs on the second defendant that was not imposed by her orders made 13 October 2021." Ground 4: "Her Honour erred at [7] by finding that the principle that a discontinuing party prima facie must pay the costs of the proceeding up to the date of discontinuance applied here, by failing to appreciate that, firstly, the application continued to be prosecuted by the first defendant after the release of the second defendant from it as his co-applicant, secondly, that the first defendant had continued to use all of the affidavit evidence which had been filed at the date of the release of the second defendant from the application in his continued prosecution of it, thirdly, that no submissions or other work performed at the date of the release of the second defendant from the application had been 'thrown away' in the first defendant's continued prosecution of it thereafter, and, fourthly, that there was no discontinuance of the application on 5 August 2021 but merely an amendment to it to release one of the applicants from it, a fact which was recognised by Cavanagh J in his limited order reserving its costs." Ground 5: "Her Honour erred at [8] by finding that the joinder of the second defendant as a co-applicant in the application when it was first filed earlier in 2021 was 'wasteful of costs' by failing to appreciate that, firstly, all the evidence served as at the date of the amendment on 5 August 2021 to release the second defendant from it as a co-applicant was in fact tendered at the hearing on 24 August 2021 before her Honour, secondly, that at the date of the amendment there were no submission filed which addressed the role of the second defendant in the application, and thirdly, that there were no objective costs incurred as at the date of the amendment on 5 August 2021 which would have been incurred by the plaintiff had the application been brought by the first defendant from its very commencement as its sole applicant." Ground 6: "Her Honour erred at [9] by failing to appreciate that the limit of her Honour's power to award costs against the second defendant under the terms of Cavanagh J's reservation order of 12 August 2021, being 'costs thrown away by the amendment', properly construed, was a power to order the second defendant to pay the costs of the filing the Amended Motion on 5 August 2021 which deleted her as an applicant."

Mrs Rahme's submissions in relation to the Second appeal issue

1. Mrs Rahme contends that although Harrison AsJ recited the terms of the reservation of costs question by Cavanagh J, her order went beyond it. Mrs Rahme contends that the amended motion filed on 5 August 2021 was in truth a different application, and Harrison AsJ had no jurisdiction over the original motion except for the jurisdiction given to her by Cavanagh J. As noted above, the costs question reserved by Cavanagh J, sitting as Duty Judge, related to "any costs thrown away by reason of the amendment to the Motion, if any". Her Honour's more general order in relation to costs exceeded her statutory powers constituting a "fundamental jurisdictional error".
2. Further, Cavanagh J's order in relation to costs posed a threshold question as to whether there was a material amount of costs thrown away as a result of the amendment. This threshold question needed to be determined "before the discretion to determine which party is liable for those 'costs thrown away' could be exercised". Mrs Rahme contends that there is merely a de minimis amount of costs incurred by B&K, and thus Harrison AsJ, if her Honour conducted the exercise appropriately, would have dismissed the costs application as frivolous and vexatious.
3. Mrs Rahme contends that the only costs which would have been thrown away were reading the abandoned original motion which would have taken an experienced solicitor 10 minutes and reading the letter from Mrs Rahme's solicitor dated 29 June 2021 withdrawing the original motion and serving the amended motion, again another 10 minutes.

B&K's submission in relation to the Second appeal issue

1. B&K submit that the order of Cavanagh J on 12 August 2021 which is in terms of "costs thrown away" by reason of the amendment to the motion is in truth not so confined. It submits that on its proper reading, Order 4 reserved the question of the appropriate order as to the costs of the amendment until the final disposition of the motion.

Consideration of the Second appeal issue

1. First, it can be noted that Mrs Rahme's contention that the amended motion was in truth a "different application" cannot be sustained. An amended application is just that, an amended application, and it shows the amendments by way of marked up words in the document. That point, however, does not determine the issue. The two questions are: 1. Whether Cavanagh J's reservation of the costs issue should have properly circumscribed or confined what Harrison AsJ determined in relation to costs, and 2. Whether the costs were de minimis.
2. As to the first question, I am of the view that whilst Harrison AsJ otherwise had power to make the order her Honour did, in the particular circumstances of this case that power must be considered in light of the order made by Cavanagh J. A common sense reading of Cavanagh J's reservation of costs order did, or should have, circumscribed or confined Harrison AsJ's determination of costs to costs thrown away, if any, as a result of the amendment to the original motion. B&K's argument that Cavanagh J's order does not indicate any such confinement is not sustainable.
3. However, I am also of the view that it cannot be seen, on the material available to me, that the costs "thrown away" are de minimis. In Mrs Rahme's analysis of what the costs are likely to have been (amounting to essentially 20 minutes of work by an experienced solicitor), she has failed to account for the exchange of written submissions, some of which have been extracted above at [12] - [16]. Those written submissions indicate to me what work, both directly and by implication, must have been done. It can be seen from the above extracts of the written submissions that Mrs Rahme's involvement was the subject of the Rahmes' written submissions dated 16 December 2020 at [12] and [13] above; which were considered and responded to on 12 March 2021 by B&K at [14] above; and were relevantly responded to in some detail by the Rahmes in relation to Mrs Rahme's involvement in the motion on 17 March 2021 at [15] - [16] above. It can reasonably be inferred that this 17 March 2021 response, at the very least, would have to have been properly considered by B&K, and a response by B&K researched (or at least carefully considered) and prepared. On the basis of the evidence before me, I am of the view that it is reasonable to infer that this would have involved work which resulted in more than de minimis costs.
4. I also note that the hearing (prior to its vacation) was originally listed for 25 March 2021, and then subsequently listed for hearing (which went ahead after the unsuccessful application before Cavanagh J on 12 August 2021 to vacate the date) on 24 August 2021. B&K were not notified that there would be an amended motion removing Mrs Rahme as one of the applicants until 29 June 2021. In all of the circumstances, I cannot find that the costs associated with Mrs Rahme's initial involvement as an applicant up until 29 June 2021 (when B&K were first notified of her removal as an applicant) or up until 5 August 2021 (when the amended application was filed) were de minimis.
5. Accordingly, on the basis of these two findings, I am of the view that there were costs thrown away as a result of the amendment of the motion removing Mrs Rahme as an applicant, and which could have properly been the subject of a confined costs order, in accordance with the order made by Cavanagh J on 12 August 2021. As such, I am of the view that it would be appropriate to award costs thrown away as a result of the amendment of the motion removing Mrs Rahme as an applicant, as agreed or assessed.

Appeal grounds 2, 7 and 11 (Third appeal issue)

1. These grounds concern the contention that Harrison AsJ misapplied her own order granting liberty to apply within 7 days of 13 October 2021 to vary the original costs order. In essence, it is contended that the 7 days expired at 5:00pm on 20 October 2021, and the email B&K sent to her Honour was sent at 6:47pm, therefore one hour and 47 minutes outside the permissible time.
2. The appeal grounds are as follows: Ground 2: "Her Honour erred at [3] by finding that the application to vary the original costs order made on 13 October 2021, being [an] application that was served by email after the close of business on 20 October 2021, was made within the terms of the grant of leave to do so by 20 October 2021, despite that application not coming to the attention of her Honour or the solicitor for the first defendant until the following day." Ground 7: "Her Honour erred by failing to appreciate that the plaintiff's application by email to her Honour sent at 6:46pm [sic: the email timestamp is 6:47pm] on 20 October 2021 ("the variation application"), that is, by email sent well after the close of business that day, was outside the terms of her Honour's grant of leave in order (2) made on 13 October 2021 to apply to vary her costs order made on 13 October 2021 by 20 October 2021, so that the variation application could only be entertained if her Honour had varied her grant of leave to permit the application to be made later than the terms of her original grant of leave." (Emphasis in original.) Ground 11: "Her Honour erred by unwittingly misleading the defendants into believing that her Honour had refused to entertain the variation application, by failing to respond to the plaintiff's email sent well after the close of business on 20 October 2021 making the variation application, including by her failure to communicate with the former solicitors or counsel for the first defendant or with the second defendant (as a self-represented litigant) directly on, or shortly after: (a) 21 October 2021, when her Honour first received notice of the email making the variation application; and (b) on, or shortly after, 15 March 2022, when the plaintiff sent a further email to her Honour, copied to the former solicitors (but not his counsel) for the first defendant, renewing its variation application on the ground that her Honour had overlooked it."

Mrs Rahme's submissions in relation to the Third appeal issue

1. To the extent that the Third appeal issue deals with the failure to provide Mrs Rahme with an opportunity to make submissions in relation to the variation application made on 20 October 2021, this has been dealt with above.
2. The remaining aspect of the Third appeal issue is whether the variation application had to be made by 5:00pm on 20 October 2021, given Harrison AsJ's order and in light of the UCPR. Mrs Rahme points to r 1.11(4) of the UCPR which she contends measures time by the hours of operation of the Court's Registry which she states are 9:00am to 5:00pm. For context, r 1.11 of the UCPR reads in full as follows: 1.11 Reckoning of time (cf SCR Part 2, rule 2; DCR Part 3, rule 1; LCR Part 4, rule 1) (1) Any period of time fixed by these rules, or by any judgment or order of the court or by any document in any proceedings, is to be reckoned in accordance with this rule. (2) If a time of one day or longer is to be reckoned by reference to a given day or event, the given day or the day of the given event is not to be counted. (3) If, apart from this subrule, the period in question, being a period of 5 days or less, would include a day or part of a day on which the registry is closed, that day is to be excluded. (4) If the last day for doing a thing is, or a thing is to be done on, a day on which the registry is closed, the thing may be done on the next day on which the registry is open. (5) Section 36 of the Interpretation Act 1987 (which relates to the reckoning of time) does not apply to these rules.

B&K's submissions in relation to the Third appeal issue

1. B&K argue that there is no mention of 5:00pm in the relevant order, and even if there had been, r 36.16 of the UCPR provides a period of 14 days from 13 October 2021 for B&K to seek a different costs order.

Consideration of the Third appeal issue

1. I do not read r 1.11(4) of the UCPR as supporting Mrs Rahme's proposition. It expressly deals with the issue of "days". It simply indicates that for the purpose of construing judgments or orders which involve any period of time, if the last day for doing something is a day on which the registry is closed (for instance, a weekend, or a public holiday), the thing may be done on the next day on which the registry is open. The rule does not deal with hours within a day, or a time on a day by which something must be done.
2. Further, as noted by B&K, 5:00pm is not specified in the order of 13 October 2021. I note the point made by B&K that r 36.16 of the UCPR does provide mechanisms for altering the order within 14 days. However, given the circumstances, that rule does not need to be invoked to answer the grounds of appeal. These grounds must fail.

Appeal ground 13 (Fourth appeal issue)

1. This ground reads as follows: Ground 13: "Her Honour fell into error by failing to find that the variation application was made for the ulterior purpose of facilitating the plaintiff to deploy the unquantified costs orders she made on 16 March 2022 - involving a liability on the part of the second defendant for costs under order (2) made on 16 March 2022 - against the second defendant as a set-off against the plaintiff's liability to the second defendant for her assessed costs under orders made against it by the Court of Appeal on 8 October 2019, certified in the sum of $579,447.92, in Federal Court of Australia proceeding no. NSD18 of 2022 (in which the plaintiff applies to set aside Statutory Demands for recovery of those costs), which the defendants would have submitted to her Honour had she given them a proper opportunity to make submissions before her decision."

Mrs Rahme's submissions in relation to the Fourth appeal issue

1. Mrs Rahme contends that had Harrison AsJ invited Mrs Rahme to make submissions in relation to the costs variation application, Mrs Rahme would have submitted that her Honour should draw inferences about ulterior purposes for B&K making the application for a costs order against Mrs Rahme. This would have included that the de minimis value of the costs of B&K thrown away by the filing of the amended motion on 5 August 2021 would have enabled the costs variation application to be characterised as frivolous and vexatious, thereby rending it an abuse of process.
2. Mrs Rahme contends there are two available inferences which can be drawn for seeking a varied costs order: "(a) the ulterior purpose of sheeting home to Mrs Rahme as many of the costs of the withdrawn original Motion as possible because of the then inevitable bankruptcy, viewed as at 20 October 2021, and actual bankruptcy, viewed as at 15 March 2022, of Mr Rahme, and no prospect of recovery against him; (b) the ulterior purpose of deploying in the Federal Court an unquantified partial joint varied costs order against Mrs Rahme for the costs thrown away incurred between 9 September 2020 (the date of filing of the original Motion) and 5 August 2021 (the date of filing of the Amended Motion and the expiry of the varied costs order against Mrs Rahme), knowing that the Federal Court judge would have no idea what was the extent of that joint liability for costs of Mrs Rahme, pending its quantification upon assessment, as a legal liability for costs of Mrs Rahme which was then available to be set-off by B&K against the various quantified judgment debts entered against it for unpaid damages [and certified costs that had been awarded against B&K and which have long since been assessed and certified]."
3. Mrs Rahme claims there is "not a scintilla of evidence that B&K incurred any costs whatsoever which were 'thrown away' in consequence of the filing of the Amended Motion on 5 August 2021." Mrs Rahme points to the failure of B&K to swear an affidavit, and points to the "very brief" written submissions filed by B&K.
4. Mrs Rahme also submits that the ulterior forensic purpose is to be gleaned by B&K's failure to seek costs of its application to vary the original costs order, stating: "The only obvious rational reasons for seeking to vary costs order [sic] are to shift B&K's pre-5 August 2021 costs away from Mr Rahme and onto the shoulders of Mrs Rahme and/or to create an unquantified liability against Mrs Rahme for costs to operate as a foundation for an equitable set-off against the adverse judgments for costs [and damages] against B&K held by Mrs Rahme in order to defend Mrs Rahme's attempt to wind-up B&K in insolvency."
5. Included in the lengthy written submissions, Mrs Rahme states: "That second ulterior purpose for making the variation application to her Honour on 20 October 2021 and once again on 15 March 2022 by Mr Werrdan Khoury, clearly on instructions from his father, Mr Dieb Khoury, on behalf of B&K, must render the variation application an abuse of process not merely because it was not disclosed to her Honour but because, even if disclosed, it remains an abuse of the Court's process."

B&K's submissions in relation to the Fourth appeal issue

1. B&K submits that the ground is baseless, and that B&K wishes to obtain a costs order against Mrs Rahme because "she abandoned her claim against them on the motion and they wish to be compensated for their legal costs."
2. In oral submissions, B&K stated as to the first so-called ulterior purpose: "We don't shy away from the fact that we are seeking a costs order against Mrs Rahme because we apprehend Mr Rahme might become bankrupt. But it doesn't mean this is any the less valid. It is perfectly standard."
3. As to the second so-called ulterior purpose, B&K submitted orally as follows: "So it is alleged that an application for costs made on the 20th of October was made for the ulterior purpose of resisting the statutory demand when we didn't even know about the underlying judgment until the 23rd of December. The timeline makes no sense whatsoever in my submission."

Consideration of the Fourth appeal issue

1. This appeal ground fails for the following reasons: 1. For the reasons set out above at [73], I do not accept that the costs incurred as a result of the withdrawal from the Notice of Motion of Mrs Rahme as a party were de minimis; 2. I accept the submissions of B&K that if it is the case that Mr Rahme was seen to be likely to be bankrupt in the short term, and it was otherwise proper to seek costs against Mrs Rahme, that is not conduct which is to be impugned; 3. The chronology makes it clear that the so-called ulterior motive of the seeking of the altered costs order so as to allow B&K to be able to deploy an unquantified set-off against the statutory demands cannot be sustained. The submission should not have been made. To claim something has been done for an "ulterior purpose" is in essence to claim bad faith on the part of a party - and is an allegation that should not be made lightly. The application to vary the costs order was made by B&K on 20 October 2021. That was before the statutory demands were made against B&K in late December 2021. Accordingly, it is simply not logical to suggest that the application was made for the ulterior purpose of creating an unquantified set-off against a statutory demand which had not yet been made.
2. In my view, there is no basis for finding there was an "ulterior purpose" (or purposes) behind the application for the altered costs order. This ground must fail.

Appeal ground 14 (Fifth appeal issue)

1. This ground reads as follows: Ground 14: "Her Honour erred by failing to forward her judgment and orders of 16 March 2022 to the defendants or to the trustee in bankruptcy for the first defendant when she emailed them to the plaintiff, thereby depriving the defendants of their right to apply to her Honour pursuant to subrules 36.16(1)-(3) to vacate her judgment and orders on the preceding grounds within the 14-day period permitted by subrule 36.16(3A)."

Mrs Rahme's submissions on the Fifth appeal issue

1. Mrs Rahme contends that the 16 March 2022 costs order and judgment should have been forwarded to Mrs Rahme and Mr Rahme's trustee in bankruptcy. Although it was forwarded to Mr Soulos, Mrs Rahme contends that he was on the record only for Mr Rahme after 5 August 2021, and his retainer ceased when Mr Rahme became bankrupt on 9 November 2021. It is contended that Harrison AsJ "must have known" that Mr Solous had formerly acted for Mr Rahme alone and that Mr Soulos had ceased to act for Mrs Rahme on his filing of the amended motion on 5 August 2021. So much is recorded, it is submitted, in the appearances in the Associate Judge's substantive and costs judgments.
2. It is contended that the failure on the part of Harrison AsJ to send the 16 March 2022 costs order and judgment to Mrs Rahme and Mr Rahme's trustee in bankruptcy deprived them of the opportunity to vacate the orders rather than appeal the decision as has occurred in this case.
3. It is further submitted that Mr Werrdan Khoury "exacerbated the problem" by his conduct in "keeping up his sleeve" the fact of the publication of the costs judgment after that date, no doubt in the hope or expectation that Mr Soulos had not become aware of the email sent to him by her Honour's Associate on 16 March 2022. It is contended that Mr Khoury did not send the costs judgment to Mr Soulos (deliberately) until 4 April 2022 when he served his affidavit in the Federal Court sworn on 1 April 2022. It is put that "No doubt that date was chosen because it was five clear days after the expiry of the deadline imposed by rule 36.16(3A) for Mrs Rahme to apply to her Honour to vacate the costs judgment and the varied orders as to costs made on 16 March 2022."

B&K's submissions on the Fifth appeal issue

1. B&K summarise the ground as one which alleges that Harrison AsJ failed to email the judgment to the parties. It is contended that this is not a matter that could be characterised as an appellable error in relation to the judgment. In any case, it is submitted that this ground is not soundly based as the judgment was emailed to Mr Soulos, the solicitor on the record.

Consideration of the Fifth appeal issue

1. The issue of whether or not the judgment was emailed to Mrs Rahme, is difficult to characterise as an appellable error in relation to the judgment, and in my view this ground of appeal cannot be made out.
2. I also note that it is most unfortunate that the situation was such that it can now be said it is not clear who was acting as solicitor for Mrs Rahme or Mr Rahme. However in a practical sense, I observe that both judgments of Harrison AsJ of 13 October 2021 and 16 March 2022 record on the cover page Solon Lawyers (the firm of Mr Soulos) as solicitors for the Defendants (plural) and I also note the sworn statement of Mr Soulos (of Solon Lawyers) set out at [35] above where he stated in his affidavit of 11 April 2022 that if he had been aware of a hearing on 16 March 2022 he "would have taken steps to obtain instructions from Dana Rahme". In light of this statement, together with the agreed fact that the judgment was in fact emailed to Mr Soulos on 16 March 2022, it can be seen that the failure of the email to come to the attention of Mr Soulos (and accordingly Mrs Rahme) can only be understood as a result of an unfortunate series of events. It can be seen that Mr Soulos appeared to be the solicitor on the record at the relevant time and was in fact emailed the judgment. The Court must be entitled to rely on the record for such details, and to be reasonably informed if that is no longer the case, either by the filing of a notice of ceasing to act if the rules require such a form to be lodged. If such a form is not required to be lodged (as appears would be the case here), on the receipt of correspondence from the Court for a party for whom a solicitor no longer acts, it is not unreasonable to expect a solicitor, who is of course an officer of the Court, to inform the Court of that fact. Indeed, Mr Soulos very properly indicated that he would have endeavoured to contact Mrs Rahme if he had been aware of the hearing on 16 March 2022.

Costs of the appeal before me

1. Given Mrs Rahme has succeeded on certain grounds of the appeal, for reasons set out below, costs should follow the event, and should be awarded on the ordinary basis. Lest it be suggested that costs should be awarded on a basis other than the ordinary basis, I note that even though Mrs Rahme succeeded on some aspects of her appeal, it can be seen that the issues which were determined could have been put before the Court in a more streamlined manner. Importantly too, in my view, the ground which raised the issue of an ulterior motive was misconceived and should not have been raised. That said, it did not take a great deal of Court time to deal with the allegation, and the total hearing took just over half a day in total.
2. I also note that B&K made a number of attempts to resolve the matter without using further Court time and these suggestions were not taken up by Mrs Rahme, albeit there was an issue raised as to whether there was a realistic opportunity of being able to send the matter back to Harrison AsJ as was suggested by B&K. It is also the case that Mrs Rahme has obtained an order more favourable to her than B&K argued was appropriate.
3. There are considerations, therefore, pulling in different directions as to how the discretion as to costs should be exercised. It would be regrettable, given the length of the hearing of the appeal motion, for more time to be taken up to argue at length about the costs of this hearing.
4. Accordingly, in all the circumstances, and noting especially the relatively short length of the hearing, my current view is that costs should follow the event and should be awarded on the ordinary basis. However, I am prepared to hear further from the parties, in writing, if required.
5. Accordingly, I make the following orders: 1. The appeal is allowed. 2. The orders made by Associate Justice Harrison on 16 March 2022 so far as they concern Dana Rahme are set aside. In lieu, the following orders are made: 1. In relation to costs up to and including 5 August 2021: 1. Subject to (ii), order that Gabriel Rahme pay Benjamin & Khoury Pty Ltd's costs of the application on the ordinary basis up to and including 5 August 2021; 2. Order that Dana Rahme pay the costs thrown away as a result of the amendment of the original motion which had the effect of removing her as an applicant, as agreed or assessed. 1. Order that Gabriel Rahme pay Benjamin & Khoury Pty Ltd's costs of the application on the ordinary basis after 5 August 2021. 1. Benjamin & Khoury Pty Ltd is to pay Dana Rahme's costs of these proceedings on the ordinary basis. 2. In the event that either party seeks to vary Order 3, I direct: 1. The party seeking a variation to provide any affidavits and submissions (limited to three pages) within 28 days; 2. The other party to provide any affidavits and submissions in reply (limited to three pages) within 14 days of receipt of the material in Order (4)(a); 3. Such an application be determined on the papers.

Endnotes

1. Filed on 12 April 2022.
2. [2019] NSWCA 239.
3. Benjamin & Khoury Pty Ltd v Rahme [2021] NSWSC 1038.
4. Benjamin & Khoury Pty Ltd v Gabriel Rahme [2021] NSWSC 1302.
5. Benjamin & Khoury Pty Ltd v Gabriel Rahme (No 2) [2022] NSWSC 279.

Amendments 23 March 2023 - Format of footnotes DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 23 March 2023