Ranclose Investments Pty Ltd v Leda Management Services Pty Ltd

District Court of NSW|2021-07-14

Background

On 30 June 2021, I determined multiple interlocutory applications brought by the plaintiff under its notice of motion dated 10 June 2021 [1] . Those applications were brought in response to my determination of earlier interlocutory applications made by the parties on 28 May 2021 [2] .
The upshot of Ranclose No.1 was that the plaintiff was ordered to provide security for the defendant's costs and was granted leave to file an amended pleading. It failed with its application that the cross-claimant provide security for the cross-defendants' costs. Certain adverse costs orders were made against the plaintiff reflecting these outcomes: Ranclose No.1 at orders (3)(b), (5), (10)-(11) in [146]. The only success that the plaintiff enjoyed in Ranclose No.2 was its application to vary the order for security so as to enable it to provide it in more tranches; although it was also granted an indulgence in having more time to file a pleading in the event that it decided that it wished to do so. All of its other applications to set aside or vary the orders (including those relating to costs) that were made in Ranclose No.1, and/or bring fresh applications, for such orders as limited discovery and the provision of information (or effectively interrogatories) by the defendant, prior to the plaintiff amending its pleading, were decided adversely to the plaintiff in Ranclose No.2.
The Court indicated that, in light of the results of the various applications heard in Ranclose No.2, subject to the costs of the application to vary the terms of the order for security, the defendant was otherwise presumptively entitled to its costs of its successful opposition to the applications.
The defendant foreshadowed in its written submissions opposing the applications the subject of determination in Ranclose No.2 that it wished to seek a special costs order in the event that it was successful. Accordingly, as part of the orders in Ranclose No.2, the Court granted the defendant opportunity to bring that application; and also made directions for the filing of evidence and submissions by the parties.

The plaintiff's submissions

The plaintiff primarily submits, without qualification, that the appropriate order is that costs of its notice of motion dated 10 June 2021 be reserved until after the determination at a final hearing. Only in this way would the Court be in the best position to rule upon the various issues raised about the "correctness" of the defendant's submissions. The issues raised on the motion were "in truth aligned" with the issues to be determined at the final hearing. If the costs of the interlocutory applications were reserved, then the trial judge would have the benefit of my judgments dated 28 May 2021 and 30 June 2021.
Further, the plaintiff submits that the success which the defendant achieved was only obtained by reason of taking positions inconsistent with its own case and evidence where the Court had 'overlooked' Mr Williamson's affidavit. With the benefit of that affidavit, and Mr Clancy's affidavit, the Court could now identify those inconsistencies.
In the alternative to its primary position, the plaintiff submits that costs should be costs in the cause. If the defendant wins, this would be consistent with its submissions to the Court, but if the plaintiff wins, this will be inconsistent with the defendant's submissions.
It appears, further, that the plaintiff takes issue with the Court's consideration, or application, in Ranclose No. 2, of the decision in Woodcroft v DPP (Cth) (2000) 174 ALR 60, as authority in rejecting some of the its applications.

The defendant's submissions

The defendant takes issue with the plaintiff's entitlement to raise its application; as it was not in conformity with the time that the Court earlier directed to bring an application for variation of a costs order. Otherwise, it submits, without any elaborated reasoning, that there should be no variation to the costs orders made in Ranclose No.2.

Consideration

What follows assumes familiarity with my reasons in Ranclose No.1 and Ranclose No.2.
It may be accepted that often the question of which party bears the costs of interlocutory applications is effectively deferred until after a final hearing, or, alternatively, costs of such applications are made costs in the cause, thereby abiding the final outcome of the proceeding. A typical example is the costs of an application for an interim injunction. The reason that a court might, in that type of situation, be reluctant to make a specific order for costs for a successful applicant for an interim injunction is that a court is not usually able to see, at the stage when the grant of the interim injunction is made, 'who in justice should bear the costs of that step': G Dal Pont, Law of Costs (4th ed, 2018, LexisNexis, electronic version) [14.24]. Associated with that is the spectre concerning a court making an order for costs on an interlocutory application which is later shown to be inconsistent, and perhaps even incompatible, with a costs order in the court's final dispositive orders.
I reject the plaintiff's basic contention that, if it ultimately succeeds in the proceeding, that ultimate success will, in some way, likely have vindicated the position it has taken in relation to the various interlocutory applications dealt with in the Court's judgment in Ranclose No.2. A brief perusal of that judgment will indicate that it did not, in any way, engage with the substantive merits of the parties' respective cases.
In Ranclose No.2, the plaintiff substantially failed in its wholesale attempt to overturn the orders - including costs orders - made in Ranclose No.1; enjoying only limited success on a term for the order for its security and the grant (which was unsolicited by the applicant) of a short extension of time to file an amended pleading.
All of the applications considered in Ranclose No.2 were discrete or severable procedural applications requiring no assessment of the merits of the parties' substantive cases. Contrary to the plaintiff's submission, there was no 'alignment' of the issues raised in the interlocutory applications with the issues "to be determined at the final hearing". Nothing that the trial judge determines after a final hearing in the matter would present the interlocutory applications determined in Ranclose No.2 in any different light.
But even if it did in some way not presently apparent, in my opinion, it would be a very onerous task for the trial judge, having otherwise made orders for the final determination at the hearing, to sift through the procedural entrails of earlier interlocutory disputes, and determine, in the light of the final result of the litigation, which party was right and which party was wrong, about past procedural disputes that were determined without any predictive assessment being made about which party was likely to ultimately prevail in the proceedings. That would burden the use of judicial time and distract the trial judge from getting on with the disposition of other business of the Court (s 57(1)(b)-(d) of the Civil Procedure Act 2005 (NSW) (the 'CP Act')). It is also desirable that the costs outcomes be determined with despatch to reflect those results, rather than leaving costs to be determined on another day (s 59 of the CP Act). In this regard, as indicated in Ranclose No.2 in multiple instances, if the unsuccessful party in the interlocutory disputes is dissatisfied with the result - including the costs orders consequently imposed following the result - there is a potential avenue for appeal; and if that avenue is not pursued, then the orders are taken to be correct.
Also relevant to the general question of costs is the extent of a party's compliance with its duty to assist the court to further the overriding purpose of facilitating the just, quick and cheap disposal of the real issues in the proceedings: CP Act, s 56(5). It will be plain from the reasons in Ranclose No.2 that, in some respects (for example [76]-[91]), the Court determined that the applicant did not comply with that duty.
To the extent that the plaintiff invokes unspecified 'inconsistencies' in the position espoused by the defendant at the hearings of these applications, and/or takes issue with the Court's interpretation and application of authorities, this is another instance, which was endemic in Ranclose No.2, of the plaintiff seeking to reargue or re-litigate, arguments in those applications upon which it did not succeed.
No basis is established for varying the orders for costs made on 30 June 2021, as set out in [114] of the reasons for judgment.
For the avoidance of any doubt, the Court confirms that, save for the costs of the application for variation of orders 7 and 8 made on 28 May 2021 - which are to be costs in the cause - the plaintiff, as the unsuccessful applicant, is to pay the defendant/cross-claimant's costs of its notice of motion dated 10 June 2021.

Endnotes

Ranclose Investments Pty Ltd v Leda Management Services Pty Ltd (No.2) [2021] NSWDC 288 ("Ranclose No.2")
Ranclose Investments Pty Ltd v Leda Management Services Pty Ltd [2021] NSWDC 210 ("Ranclose No.1") 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: 14 July 2021

Civil Procedure Act 2005(NSW)ss 56, 57, 59

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