Robinson v Deep Investments Pty Ltd

JAGOT AND COLVIN JJ: 2 The remaining issues in this matter concern the orders as to costs which should be made in the proceeding before the primary judge and in the appeal and cross-appeal to this Court. The appellants seek orders that the respondent, Deep Investments, pay the costs of the appellants in the proceeding before the primary judge and the costs of the application for leave to appeal, the appeal and the cross-appeal on the basis that having succeeded in obtaining the summary dismissal of Deep Investments' application costs should follow the event in the usual course. Deep Investments contends that the appellants succeeded in the appeal on a limited ground not argued by them and thus the costs order in its favour in the Court below should remain and the costs of the appeal and cross-appeal proceedings be apportioned so that Deep Investments pays 30% of the appellant's costs. 3 Deep Investments' contentions are based on a misconception. It is that there was no issue raised between the parties as to whether the claims made in this Court were the same as those advanced in the Supreme Court. In both the proceeding below and the appeal it was necessary to resolve the question whether Deep Investments could maintain the proceedings in this Court given that Deep Investments had already made and discontinued claims relating to the same subject matter in the Supreme Court. In order to resolve that question it was necessary to consider and compare the nature of the claims made in the Supreme Court and the nature of the claims made in this Court. It is true that one aspect of the case involved the receipt of information by Deep Investments a few weeks before the trial in the Supreme Court which it said enabled it subsequently to work out that it had available other causes of action which it brought in this Court to recover the same loss claimed in the Supreme Court proceedings. Contrary to the submissions for Deep Investments, however, the case put against it included that the proceedings in this Court constituted an abuse of process because they involved the re-litigation of claims made in the Supreme Court. As explained at [71] to [73] of the principal reasons, the reason the majority considered that the proceedings in this Court constituted an abuse of process was that they ultimately depended on the same claim as the subject of the litigation in the Supreme Court, the mismanagement of the portfolio. Accordingly, it is not the case that the proceedings in this Court were decided on a basis other than that argued by the parties. The submissions for Deep Investments involve a misreading of one paragraph of the majority's reasons, [13], in which this was said: The arguments traverse principles of res judicata, issue estoppel, Anshun estoppel, abuse of process, the effect of s 91 of the Civil Procedure Act 2005 (NSW) and certain aspects of the law as to fiduciary duties and agency. However, at their heart the main issue in the appeal concerns whether Deep Investments can bring new claims related to the subject matter of the Supreme Court proceedings in circumstances where the explanation for doing so is the receipt of information a few weeks before the commencement of the trial in those proceedings. The information is relied upon to provide the foundation for the claims brought in the proceedings in this Court. 4 The submissions for Deep Investments appear to overlook the references in this summary statement to "claims related to the subject matter of the Supreme Court proceedings" and to focus instead on the new information. The new information was the explanation by Deep Investments for its conduct in litigating twice in respect of the same subject matter. The fact that Deep Investments asserted that its conduct was reasonable because of the information and the respondents challenged the characterisation of both the information (as not being new) and the conduct of Deep Investments (as not being reasonable) does not mean that the only or even the main issue in the proceedings was the status of that information (referred to as the Wilson documents in Deep Investments' submissions). 5 Contrary to the submissions for Deep Investments, the proceedings before the primary judge also included the same contention by the respondents of abuse of process arising from an attempt to re-litigate the same claims. As a result Deep Investments' submission that this Court should not disturb the costs order made below cannot be accepted. The respondents succeeded on the appeal and should have succeeded below. They succeeded on the principal ground which had been put, both below and in the appeal, that the claims in this Court involved an illegitimate attempt to re-litigate claims made in the Supreme Court. Barring some appropriate reason, the usual order as to costs should be made in favour of the respondents in the proceedings below and on appeal. We accept, however, that the usual order should operate subject to any specific order the primary judge made to the contrary in relation to interlocutory matters. 6 For the same reasons, the submission for Deep Investments that each party should bear its own costs of the appeal because "the majority determined the appeal in favour of the appellants on a basis not argued by them, and the appellants in fact failed on the main issue argued on the appeal, and which argument was fact intensive and used the majority of the Court's time" also cannot be accepted. As set out above, the submission is incorrect in asserting that the majority decided the appeal on a basis not argued. The submission also fails to appreciate that it was Deep Investments who relied on the Wilson documents as an explanation for its conduct in an attempt to avoid the respondents' contentions that Deep Investments was attempting to re-litigate the same issues as had been litigated in the Supreme Court. The respondents were entitled to challenge that explanation. The fact that the reasoning of the majority found an abuse of process irrespective of the Wilson documents is not to the point in circumstances where it was Deep Investments which relied on the documents to explain its conduct. The submission is the equivalent of asserting that despite the Wilson documents being relevant to some of the contentions of the respondents (particularly, Anshun estoppel which involves a consideration of the reasonableness of the conduct of the party against whom the estoppel is sought to be raised) the respondents should not have advanced any argument about the documents and the conduct of Deep Investments merely because of the chance the Court would decide in their favour on some other ground. That assertion is untenable. The respondents were entitled to test and dispute the relevance of the Wilson documents, just as the Court was entitled to decide the case on one basis (abuse of process) and not others. It may be accepted that the reasonableness of Deep Investments' conduct was fact intensive and took time in the appeal but it was Deep Investments which asserted the reasonableness of its conduct, which the respondents were entitled to test and dispute. In summary, there is no justification in the present matter for exclusion of the usual order as to costs in favour of the respondents as the successful parties. 7 I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Jagot and Colvin.