Short v Crawley

Judgment 1HIS HONOUR: The issues on this application are whether the plaintiffs are precluded from applying for a gross sum costs order and from seeking interest on costs because their application was not made within 14 days of the entry of final costs orders. The question is whether there is power to make the orders sought. I make no comment on the merits of the applications, including whether delay would be a reason either alone or in combination with other circumstances, for refusing the applications on discretionary grounds. 2The principal judgment at first instance was given on 26 November 2007 (Short v Crawley (No. 30) [2007] NSWSC 1322 (the liability judgment)). Orders were made on 19 December 2007 to give effect to those reasons. Those orders included an order that the third further amended cross-claim be dismissed and that the cross-claimants pay the cross-defendants' (the plaintiffs) costs on an [sic] indemnity basis. The orders of 19 December 2007 required Mr Crawley to purchase Nabatu's share in two companies (J & J O'Brien and Marsico) at a valuation of one-third of the net assets of each company on the basis set out in the orders which reflected numerous judgments to be entered in favour of J & J O'Brien and Marsico against the defendants. After a further hearing to determine the value of the shares (Short v Crawley (No. 38) [2008] NSWSC 917), orders were made for Mr Crawley to purchase the shares. That purchase was duly made. On 12 December 2008 I gave judgment dealing with the costs of the proceedings (Short v Crawley (No. 40) [2008] NSWSC 1302). I rejected the plaintiffs' submission that the defendants should be ordered to pay the plaintiffs' costs of the main proceeding on the indemnity basis and I also rejected the defendants' submissions that I should make no order as to costs, except that each party pay its own costs. The plaintiffs did not submit that the costs of the valuation hearing should be paid by the defendants on the indemnity basis (Short v Crawley (No. 40) at [60]). I rejected the defendants' submission that there should be no order as to costs in respect of the valuation hearing and I dealt with reserved costs. The costs orders made were as follows: "1. All reserved costs, except costs of the first to ninth defendants' notice of motion of 22 February 2008 reserved on 28 March 2008, be costs in the proceedings. 2. The first to sixth defendants pay the plaintiffs' costs of and incidental to the valuation of Nabatu's shares in Marsico and J & J O'Brien, but such costs not include any costs of or incidental to the reports of Ms Deborah Cartwright of 9 May 2008 or 30 May 2008 described as the audit reports in respect of Jackson's on George and the Marlborough Hotel. 3. Except as otherwise provided by earlier orders: (a) the first to sixth defendants pay two-thirds of the plaintiffs' costs of the proceedings as assessed on the ordinary basis or agreed; (b) the seventh defendant pay the plaintiffs' costs as assessed on the ordinary basis or agreed in relation to the claims made against the seventh defendant; (c) the ninth defendant pay the plaintiffs' costs as assessed on the ordinary basis or agreed in relation to the claims made against the ninth defendant; (d) the plaintiffs pay the eighth defendant's costs assessed on the ordinary basis or agreed in relation to the claims against the eighth defendant." 3The defendants appealed and the plaintiffs cross-appealed. Both the appeal and cross-appeal were partially successful (Crawley v Short [2009] NSWCA 410; (2009) 262 ALR 654). As a result of the decision of the Court of Appeal, the amount that Mr Crawley had to pay to acquire Nabatu's shares in J & J O'Brien and Marsico was reduced from $11,443,134 to $10,966,778 (Crawley v Short (No. 2) [2010] NSWCA 97). The Court of Appeal ordered that there be no order as to the costs of the appeal and cross-appeal and did not alter the costs orders below. The orders of the Court of Appeal were made on 7 May 2010. 4On 27 October 2012 the plaintiffs filed a notice of motion seeking orders that the orders as to costs made on 13 August 1999, 2 September 1999, 26 November 2002, 12 December 2008, 19 December 2007 and 2 October 2009 be varied such that the relevant defendants or cross-claimants pay instead of assessed costs a gross sum as determined by the Court pursuant to s 98(4)(c) of the Civil Procedure Act 2005. The notice of motion has been amended by adding additional costs orders as the subject of the application. Alternatively the plaintiffs seek orders that the costs payable pursuant to the identified orders be fixed in grossed sums to be determined by the Court pursuant to s 98(4)(c) of the Civil Procedure Act. The latter formulation avoids reference to the earlier costs orders being varied. 5The notice of motion also makes a claim for interest. This is a claim for interest on costs and is made pursuant to s 101(4) of the Civil Procedure Act. 6Section 98 of the Civil Procedure Act relevantly provides: "98 Courts powers as to costs (cf Act No 52 1970, section 76; SCR Part 52A, rules 5, 6, 7 and 8; Act No 9 1973, section 148B; Act No 11 1970, section 34) (1) Subject to rules of court and to this or any other Act: (a) costs are in the discretion of the court, and (b) the court has full power to determine by whom, to whom and to what extent costs are to be paid, and (c) the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis. (2) Subject to rules of court and to this or any other Act, a party to proceedings may not recover costs from any other party otherwise than pursuant to an order of the court. (3) An order as to costs may be made by the court at any stage of the proceedings or after the conclusion of the proceedings. (4) In particular, at any time before costs are referred for assessment, the court may make an order to the effect that the party to whom costs are to be paid is to be entitled to: (a) costs up to, or from, a specified stage of the proceedings, or (b) a specified proportion of the assessed costs, or (c) a specified gross sum instead of assessed costs, or (d) such proportion of the assessed costs as does not exceed a specified amount." 7Rule 36.16 of the Uniform Civil Procedure Rules relevantly provides: "36.16 Further power to set aside or vary judgment or order (cf SCR Part 40, rule 9) (1) The court may set aside or vary a judgment or order if notice of motion for the setting aside or variation is filed before entry of the judgment or order. ... (3) In addition to its powers under subrules (1) and (2), the court may set aside or vary any judgment or order except so far as it: (a) determines any claim for relief, or determines any question (whether of fact or law or both) arising on any claim for relief, or (b) dismisses proceedings, or dismisses proceedings so far as concerns the whole or any part of any claim for relief. (3A) If notice of motion for the setting aside or variation of a judgment or order is filed within 14 days after the judgment or order is entered, the court may determine the matter, and (if appropriate) set aside or vary the judgment or order under subrule (1), as if the judgment or order had not been entered. (3B) Within 14 days after a judgment or order is entered, the court may of its own motion set aside or vary the judgment or order as if the judgment or order had not been entered. (3C) Despite rule 1.12, the court may not extend the time limited by subrule (3A) or (3B). (4) Nothing in this rule affects any other power of the court to set aside or vary a judgment or order." 8The phrase "claim for relief" is defined in s 3 of the Civil Procedure Act as follows: "claim for relief includes: (a) a claim for possession of land, and (b) a claim for delivery of goods, and (c) a claim for the recovery of damages or other money, and (d) a claim for a declaration of right, and (e) a claim for the determination of any question or matter that may be determined by the court, and (f) any other claim (whether legal, equitable or otherwise) that is justiciable in the court." That definition applies also to the same expression where it appears in the Uniform Civil Procedure Rules (Interpretation Act 1923 (NSW), s 11). 9Section 14 of the Civil Procedure Act provides: "14 Court may dispense with rules in particular cases In relation to particular civil proceedings, the court may, by order, dispense with any requirement of rules of court if satisfied that it is appropriate to do so in the circumstances of the case." 10At a directions hearing Mr Ogborne, who appeared for the first, fourth, fifth, sixth, eighth, ninth and tenth defendants, indicated that those parties would be contending that the plaintiffs' claim for a gross sum costs order was bound to fail because the application sought to vary the costs orders previously made and was not brought within 14 days as required by r 36.16 of the Uniform Civil Procedure Rules. 11On 14 June 2013 I made the following order (as subsequently corrected by the slip rule): "2. Order that the following questions be answered separately and in advance of the determination of the other issues in the proceedings: a. whether the court has power to make the orders sought in the plaintiff's further amended notice of motion filed 14 June 2013. b. If the answer to question (a) is yes, but only if the court dispenses with a requirement or requirements of the rules pursuant to s 14 of the Civil Procedure Act, whether the Court should dispense with such a requirement or requirements." 12Mr Ogborne submitted that where a Court has already made a costs order determining the rights of the parties in proceedings, the power in s 98(3) of the Civil Procedure Act to make an order as to costs "at any stage of the proceedings or after the conclusion of the proceedings" does not empower the Court to set aside or vary a final costs order unless a notice of motion for the setting aside or variation of the order is filed within 14 days after the costs order was entered (UCPR, r 36.16(3A)). He submitted that the orders specified in s 98(4) are but particular instances of an order as to costs which, by s 98(3), may be made at any stage of the proceedings or after the conclusion of the proceedings. But because the Court is not empowered to vary a previous costs order unless a notice of motion is filed within 14 days pursuant to UCPR, r 36.16(3A) then the power under s 98(4), which is but a particular instance of the general power conferred by s 98(3), likewise does not empower the Court to vary a previous costs order if the requirements of UCPR, r 36.16 have not been met. Although s 98(4) permits the Court to make a gross sum costs order at any time before the costs are referred for assessment, it is silent as to the time by which an application for a lump sum costs order must be made. 13Mr Ogborne also submitted that the application for interest on costs could not be entertained because the application was not made within 14 days of entry of the costs orders. He relied on the judgment of McColl JA in Zepinic v Chateau Constructions (Australia) Limited (No 2) [2013] NSWCA 227. Her Honour held that where no order for interest on costs was made when the original costs order was made, an application for such an order was an application that sought the variation of a judgment or order of the Court within the meaning of UCPR, r 36.16 even though it would add an order rather than amend an existing order (at [84], [85]). Her Honour held that the application had to be made within 14 days of the entry of the costs order. Mr Ogborne submitted that as the application for orders for interest on costs was not made at the time the relevant costs orders were made, nor within the 14 days permitted by UCPR, r 36.16(3A), the application for interest on costs was incompetent. 14I will deal first with the competence of the application for a gross sum costs order.

Gross Sum Costs Order 15Rule 36.16(3A) was introduced following the change to the procedure for the entering of orders whereby orders will be entered by the Court itself on its computerised record. The rule provides a limited opportunity to ameliorate the principle that subject to only limited qualifications an order that finally disposes of proceedings, once entered, cannot be reopened (Bailey v Marinoff (1971) 125 CLR 529; Gamser v Nominal Defendant (1977) 136 CLR 145; DJL v Central Authority (2000) 201 CLR 226; Burrell v R [2008] HCA 34; (2008) 238 CLR 218; D'Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1 at [34], 17; Deputy Commissioner of Taxation v Meredith (No. 2) [2008] NSWCA 133; (2008) 75 NSWLR 462 at [15]). In Malouf v Prince (No. 2) [2010] NSWCA 51 the Court of Appeal said (at [11]): "[11] The 14-day window afforded by UCPR 36.16(3A) creates an exception to the principle that ordinarily a court has no power to set aside a final judgment after it has been entered: Rockcote Enterprises Pty Ltd v FS Architects Pty Ltd (No 2); Carelli v FS Architects Pty Ltd (No 2) [2008] NSWCA 205 (at [8]) per Campbell JA (McColl JA and Handley AJA agreeing) (Special Leave Refused: FS Architects Pty Ltd v Rockcote Enterprises Pty Ltd; FS Architects Pty Ltd v Carelli [2009] HCASL 52); see also Bennette v Cohen (No 2) [2009] NSWCA 162 per Tobias JA (at [9]) (Ipp and Campbell JJA agreeing); Deputy Cmr of Taxation v Meredith (No 2) [2008] NSWCA 133 (at [6]-[7]) per Basten JA (Ipp JA agreeing)." 16Each of subrules 36.16(1), (2), (3), (3A) and (3B) confers power on the court to vary or set aside its orders. Subrule (1) confers such a power if the notice of motion is filed before the order is entered. Subrules (3A) and (3B) in substance extend that time by 14 days. That period cannot be further extended (subrule (3C)). Subrule (2) confers additional powers to vary or set aside an order if it is a default judgment, or was made in the absence of a party. Subrule (3) also confers power to vary or set aside an order. It applies to the varying or setting aside of any order, whether entered or not, except so far as the order determines a claim for relief, or determines any question arising on a claim for relief, or dismisses the proceedings, or dismisses a claim for relief. The words "except so far as" in subrule (3) are important. They do not mean "unless". That is to say, it is only so far as an order determines a claim for relief, or a question on such a claim, or dismisses a proceeding, or a claim in a proceeding, that the power to vary the order is excluded. 17If the claim for relief sought to be raised has not been determined and the proceeding has not been dismissed, then it is not an objection to the court's power to determine the claim for that relief, that the granting of the relief would involve the setting aside or variation of an earlier order. Nor would it matter whether the application was made within 14 days of entry of the order sought to be varied. That is because the power of variation invoked would not be the power under r 36.16(1) as extended by r 36.16(3A), but the separate power under r 36.16(3). 18In the present case there has been no determination of the plaintiffs' claim for a gross sum costs order, nor for interest on costs. 19Subrule 36.16(4) preserves any other power of the court to set aside or vary a judgment or order. This includes the power to make supplemental orders for the purpose of dealing with a matter involved in the working out of the order, or modifying its operation to take account of changed circumstances, or enforcing it (Phillips v Walsh (1990) 20 NSWLR 206 at 209-210). 20If an additional order is sought after orders have been made finally disposing of proceedings, where the application cannot be supported by a statutory power to vary existing orders, or to make an additional order, the application may be barred by principles of finality of litigation. The most frequently cited expression of that principle is that given by Barwick CJ in Bailey v Marinoff (1971) 125 CLR 529 where his Honour said (at 530): "Once an order disposing of a proceeding has been perfected by being drawn up as the record of a court, that proceeding apart from any specific and relevant statutory provision is at an end in that court and is in its substance, in my opinion, beyond recall by that court. It would, in my opinion, not promote the due administration of the law or the promotion of justice for a court to have a power to reinstate a proceeding of which it has finally disposed." 21Notwithstanding the views expressed by the Court of Appeal in Hancock v Arnold; Dodd v Arnold (No. 2) [2009] NSWCA 19 at [10] it has repeatedly been held by the Court of Appeal that subject to the possible application of s 14 of the Civil Procedure Act, a final costs order once entered cannot be varied unless a notice of motion is filed within 14 days after the order is entered (Roads and Traffic Authority of NSW v Palmer (No. 2) [2005] NSWCA 140 at [20]-[21]; Deputy Commissioner of Taxation v Meredith (No. 2) at [6]-[16]; Bennette v Cohen (No. 2) [2009] NSWCA 162 at [6]-[11]; Coastwide Fabrication & Erection Pty Ltd v Honeysett (No. 2) [2009] NSWCA 291 at [12]-[17]; Roads and Traffic Authority of NSW v Refrigerated Roadways Pty Ltd (No. 2) [2009] NSWCA 336 at [5]-[11]; Malouf v Prince (No. 2) at [7]-[24]; Habib v Nationwide News Pty Ltd (No. 2) [2010] NSWCA 291 at [33]-[39]; AT v Commissioner of Police NSW (No. 2) [2010] NSWCA 337 at [6]-[13]; Griffith v Australian Broadcasting Corporation (No. 2) [2011] NSWCA 145 at [10]-[11], [34]; Kable v State of New South Wales (No. 2) [2012] NSWCA 361 at [9]-[15]). 22Section 98(3) expressly provides that orders as to costs may be made after the conclusion of proceedings. Prior to the Civil Procedure Act and Uniform Civil Procedure Rules coming into force provisions to the same effect as s 98(3) and UCPR, r 36.16(3) were contained in Pt 52A, r 5 and Pt 40, r 9(4) of the Supreme Court Rules. In Roads and Traffic Authority v Palmer (No. 2), Giles JA said of Pt 52A, r 5 (at [17]): "[17] Part 52A r 5 provides that the Court may, in any proceedings, exercise its powers and discretions as to costs at any stage in the proceedings or after the conclusion of the proceedings. The rule is relevantly concerned with costs orders after the substantive decision has been given, and must be subject to finality from entry of costs orders already made. ..." In other words, costs orders can be made after the proceedings were otherwise concluded, but once made, are final. 23The principle of finality of litigation that proceedings once disposed of cannot be re-opened applied to the making of final costs orders (Preston Banking Co. v William Allsup & Sons [1895] 1 Ch 141). 24In all of the cases cited at para [21] above, there had been a determination of a party's entitlement to costs that was sought to be varied. Accordingly, r 36.16(3) did not confer power to vary the orders unless application was brought within 14 days of the costs orders being entered, or recourse could be had to s 14 of the Civil Procedure Act. The principles of finality of litigation applied that precluded recall of the orders unless a statutory provision could be invoked. 25None of the above cases dealing with the power to vary costs orders has concerned an application for a gross sum costs order. 26The costs orders made in this case did not determine any claim for an order that the plaintiffs be entitled to a specified gross sum for costs instead of assessed costs. No such claim was made when the question of costs was argued. In its opening written submissions on the question of costs the plaintiffs foreshadowed that they intended to apply for a costs order in an amount of a specified gross sum instead of assessed costs, but withdrew that contention in oral submissions. In oral submissions, counsel for the plaintiffs said that the plaintiffs were asking for an order for costs on the conventional basis that would require an assessment. That might provide a discretionary reason for refusing the application, but that is not the present question. 27I accept Mr Ogborne's submission that if a gross sum costs order were made the previous costs orders would be varied. But the variation would not be as to the substance of the order, that is, as to the extent of the defendants' liability to pay costs. The variation would only be as to the mode of quantifying what sum of money was payable pursuant to the costs orders. To that limited extent a gross sum costs order would vary all of the costs orders pursuant to which costs are to be assessed either on the ordinary basis or, in relation to the costs of the cross-claim, on the indemnity basis. The variation would not be in respect of a claim for relief or of any question arising on a claim for relief that has been determined. 28I accept that in the costs orders the reference to costs being assessed on the ordinary basis is to their being assessed in the way provided for by Pt 3.2 of the Legal Profession Act 2004, that is, by an assessment by a costs assessor to whom the assessment is referred by the Manager, Costs Assessment. The position is the same for the other costs orders (leaving aside the indemnity costs order) which do not expressly refer to the payment of costs "as assessed on the ordinary basis or agreed". Pursuant to r 42.2 those costs are to be assessed on the ordinary basis. If the Court were to make a gross sum costs order pursuant to s 98(4) the order would be made for the payment of a gross sum "instead of" assessed costs. Necessarily therefore some variation would be made to the existing costs orders. However, in making a gross sum costs order a court endeavours within the constraints of a summary procedure not involving a detailed assessment to make a logical, fair and reasonable estimate of what sum is payable under the costs order (Harrison v Schipp [2002] NSWCA 213; (2002) 54 NSWLR 738 at [22]). That is, the making of a gross sum costs order would provide a different mode of assessment than provided for by the existing orders, but would not otherwise vary the orders. It would not involve a variation of the claim for costs that was determined by the costs orders that were made. 29Different modes of expression have been adopted when gross sum costs orders are made after an earlier costs order was made whose effect was that costs be assessed or taxed. Sometimes it is ordered that the gross sum be paid "instead of" assessed costs (e.g. Harrison v Schipp; Simone Starr-Diamond v Talus Diamond (No. 4) [2013] NSWSC 811). Sometimes it is ordered that the gross sum be paid "in respect of" the costs previously ordered (e.g. Levy v Bablis [2012] NSWSC 661; Olivaylle Pty Ltd v Flottweg GMB & Co KGAA (No.6) [2011] FCA 688). Sometimes it has been ordered that the gross sum be paid "pursuant to" the costs order previously made (e.g. Beach Petroleum NL v Johnson (No. 2) (1995) 57 FCR 119; Salfinger v Niugini Mining (Aust) Pty Ltd (No. 5) [2008] FCA 1119). These differences of expression do not connote any difference in substance. Each of the expressions is correct. The gross sum is paid pursuant to the previous costs order and in respect of the previous costs order and is payable instead of assessed costs. Whilst the original costs order is thereby varied, it is not varied in respect of the matter that was the subject of determination when the order was made. Rule 36.16(3) confers power to vary the previous costs orders by substituting an order for payment of a gross sum instead of a sum determined by an assessment. 30In any event, the making of a gross sum costs order does not infringe the principles of finality of judgments. Those principles are subject to contrary statutory provision. In Beach Petroleum NL v Johnson (No. 2), von Doussa J said of the Federal Court Rules (at 120): "Order 62, r 4(2) relevantly provides: Where the Court orders that costs be paid to any person, the Court may further order that as to the whole or any part of the costs specified in the order, instead of taxed costs, that person shall be entitled to: ... (c) a gross sum specified in the order instead of the taxed costs; or (d) a sum in respect of costs to be ascertained in such manner as the Court may direct [emphasis added]. Pursuant to O 62, r 3(1) the Court may exercise its powers and discretions as to costs at any stage of the proceedings, or after the conclusion of the proceedings. In my opinion the Court has power to make a gross sum order at this stage notwithstanding that costs orders were earlier made which envisaged taxation in the ordinary way." 31There is no material difference between those rules and s 98 of the Civil Procedure Act. The decision in Roads and Traffic Authority of NSW v Palmer (No. 2) does not address the impact of s 98(3) (formerly Pt 52A, r 5) on the court's ability to entertain an application for a gross sum costs order. Pursuant to s 98(3) and (4) the Court can exercise its powers and discretion as to costs after the conclusion of the proceedings and this includes the making of a gross sum costs order provided that the order is made before costs are referred for assessment. 32In Smoothpool Nominees Pty Ltd v Pickering [2001] SASC 131 it was argued that the Court was functus officio when it made its costs order and there was no jurisdiction to make an order for the payment of costs on a lump sum basis after the first order had been made. The rules of the South Australian Supreme Court differed from O62, r 4(2) of the Federal Court Rules in that they did not include the expression that the Court "may further order". Lander J rejected the submission and held that the words "may further order" did not have a temporal meaning but meant that the court could make a consequential order in relation to the original order for costs. His Honour held that he could make such a consequential order notwithstanding the differences in the rules. 33Further, in my view, a gross sum costs order is a supplemental order that makes more specific provision for the implementation of the earlier costs order by providing an alternative mode of enforcing it, that does not alter the substantive relief given by the previous costs order, and falls within the narrow class of exceptions to the principle that when proceedings have been disposed of by a final order they are at an end (Phillips v Walsh at 209-210). As such there is a further power of variation preserved by r 36.16(4). Thus it has been held that in accordance with the power to make such supplemental orders, an order for costs may be made against a non-party notwithstanding the entry of the final judgment in the proceeding (Caboolture Park Shopping Centre Pty Ltd (In Liq) v White Industries (Qld) Pty Ltd (1993) 45 FCR 224 at 235; UTSA Pty Ltd (In Liq) v Ultra Tune Australia Pty Limited (1998) 146 FLR 209 at 212-213). In Re Scowby; Scowby v Scowby [1897] 1 Ch 741 a supplemental order was made whose effect was to stay an order for the payment of costs out of a trust estate to the former trustees until they complied with another order requiring payment of a large sum into court. 34In Harrison v Schipp the order for costs was made on 20 February 2001. The notice of motion for a gross sum costs order was filed on 10 May 2002. In Simone Starr-Diamond v Talus Diamond (No. 2) the costs order was made on 20 July 2012. The notice of motion that sought a gross sum costs order was dated 18 April 2013. In Levy v Bablis the costs order was made on 19 May 2011. The notice of motion seeking a gross sum costs order was filed on 25 January 2012. These are examples of gross sum costs orders being made in this court pursuant to notices of motion filed well after the entry of otherwise final costs orders. 35On the construction of r 36.16(3) I have adopted, where there is an application to set aside or vary a judgment or order other than to the extent that it determines any claim for relief, or determines any question arising on any claim for relief, or dismisses proceedings, or dismisses proceedings so far as they concern the whole or any part of any claim for relief, there is no time limit within which the applicant must bring the application imposed by the rules. Assuming that no other limitation is relevant, it would be a matter for the discretion of the court whether to allow the application. That is also the position if an application is made to set aside or vary an order under r 36.16(2) or under other rules (e.g. the slip rule, r 36.17), or in the exercise of jurisdiction to make supplemental orders. Relevant to the exercise of the discretion would be the merits of the substantive application to set aside or vary the judgment or order, the period of time that has elapsed between the original judgment or order and the making of the application and any explanation for that delay. 36This construction of the Act and Rules is consistent with ss 56 and 57 of the Civil Procedure Act. Pursuant to ss 56(2) and 57(2) the Court is to interpret the Act and the Rules to give effect to the overriding purpose of facilitating the just, quick and cheap resolution of the real issues in the proceedings and to manage proceedings having regard to the objects of their just determination, the efficient disposal of the business of the Court, the efficient use of available judicial and administrative resources, and the timely disposal of proceedings at an affordable cost. There may be good reasons for a party not to seek a gross sum costs order when the costs orders are made or within 14 days thereafter. In some cases the ground for making a gross sum costs order is to reduce the expense that would be incurred by the successful party in having costs assessed because the financial position of the unsuccessful party makes it likely that such expense could not be recovered. This might not be apparent at the time the costs order is made. 37Another reason for delaying the application may be the prospect that the costs order will be set aside or varied on appeal. Just as parties may reasonably defer referring costs for assessment pending an appeal, it might be reasonable to defer the expenditure of costs on an application for a gross sum costs order until the outcome of an appeal is known. 38It may be necessary for the successful party at first instance to engage a costs consultant to provide an opinion as to what would be involved in an assessment of costs, and the time and expense entailed in an assessment compared with an application for a gross sum costs order. The costs consultant's opinion might not be available within 14 days of costs orders being made. It would often be reasonable to defer this expense until the outcome of the appeal is known. 39The plaintiffs say that all of these factors apply in the present case. I make no finding about that as the same issues will arise when the merits of the application for a gross sum costs order are determined. But I accept as a matter of principle that those general considerations indicate that the construction of the Act and the Rules that better promotes the objects in ss 56 and 57 of the Civil Procedure Act is one that does not require the application to be made within 14 days of the making of final costs orders. Indeed, I think this is implicit in s 98(4) that contemplates that a gross sum costs order can be made at any time before the costs are referred for assessment. Given that there may be a considerable delay pending the determination of appeals and in the preparation required either for an assessment, or an application for a gross sum costs order, it is unlikely that Parliament intended that the application for such an order would have to be made at the same time as or within 14 days after the costs orders were made. 40For these reasons I conclude that the Court does have the power to make the gross sum costs orders sought in the notice of motion. It is unnecessary for the plaintiffs to rely on s 14 of the Civil Procedure Act seeking an order that any requirement of the rules be dispensed with. 41In Hancock v Arnold (No. 2) (at [11]), Roads and Traffic Authority (NSW) v Refrigerated Roadways Pty Ltd (No. 2) (at [6]), and Spina v Permanent Custodians Ltd (No. 2) [2009] NSWCA 419 at [93], the Court of Appeal raised but did not determine the possibility of recourse to s 14 of the Civil Procedure Act to dispense with a requirement imposed by the rules that the application be filed within 14 days of the costs orders being entered. 42In AT v Commissioner of Police (NSW) (No. 2) Basten JA said (at [7]-[11]): "[7] Where a costs order is made, and entered, it is necessary for any application to vary the order to be made by notice of motion 'filed within 14 days after the judgment or order is entered': Uniform Civil Procedure Rules 2005 (NSW) ('UCPR'), r 36.16(3A). The time to take that step expired on 18 June 2010, more than two and a half months before the notice of motion was in fact filed. In those circumstances, there is, arguably, no power to set aside or vary the order: Deputy Cmr of Taxation v Meredith (No 2) [2008] NSWCA 133; 75 NSWLR 462 at [6]-[16]. As noted in Roads and Traffic Authority (NSW) v Refrigerated Roadways Pty Ltd (No 2) [2009] NSWCA 336, the court has 'contemplated the possibility' that a costs order could be varied notwithstanding no notice of motion was filed within 14 days after the order was entered, if there had been an oral application to vary within that period: at [6] (Campbell JA), referring to Hancock v Arnold; Dodd v Arnold (No 2) [2009] NSWCA 19 at [9]-[12]. There was no such application in the present case. [8] In Refrigerated Roadways at [10], consideration was also given to the possibility that 'the stringency of the 14 day time period might be ameliorated' by exercise of the power granted by the Civil Procedure Act 2005 (NSW), s 14, which provides: 14 Court may dispense with rules in particular cases In relation to particular civil proceedings, the court may, by order, dispense with any requirement of rules of court if satisfied that it is appropriate to do so in the circumstances of the case. [9] Although the possibility of reliance on s 14 was also noted in Spina v Permanent Custodians Ltd (No 2) [2009] NSWCA 419 at [9], the difficulty with such an approach is that the course permitted by s 14 must act differentially, so as to remove the time limit and leave an unlimited power in the court to vary orders which have been entered. Because r 36.16 itself precludes the operation of r 1.12, which might otherwise allow the court to extend the time, this would constitute a rewriting of r 36 in a way clearly not envisaged by its terms: cf r 36.16(3C). [10] Nor is it possible to omit the whole of the rule, because then one would be left with the general law, which does not permit a court, absent statutory authority, to vary orders once they have been entered: DJL v Central Authority [2000] HCA 17; 201 CLR 226 at [38]-[40], referring to Bailey v Marinoff [1971] HCA 49; 125 CLR 529 at 530. In Malouf v Prince (No 2) [2010] NSWCA 51 at [20], the court (McColl and Macfarlan JJA, Nicholas J) referred to a statement in Jeffery & Katauskas Pty Ltd v SST Consulting Pty Ltd [2009] HCA 43 ; 239 CLR 75 at [23] where French CJ, Gummow, Hayne and Crennan JJ stated: It is no doubt arguable that the reference to 'any requirement of rules of court' in s 14 limits its application to rules imposing some duty on parties and does not extend it to a rule imposing limitations on the power of the court to order costs. [11] In Malouf, the court considered that r 36.16 fell within the former category." 43In Kable v State of New South Wales [2012] NSWCA 243 the Court of Appeal made orders on 8 August 2012 setting aside orders at first instance in the Common Law Division that dismissed proceedings against the first defendant and ordered the plaintiff to pay costs. In lieu of those orders the Court of Appeal gave judgment for the plaintiff for damages to be assessed and ordered the respondent (the first defendant below) to pay the plaintiff costs of the proceedings in the Common Law Division to date. Those orders were entered on the Court's computerised record system on 8 August 2012. On 24 August 2012, i.e. 16 days after the costs orders were entered, the respondent filed a notice of motion seeking to vacate, i.e. set aside, the order requiring the first defendant to pay the costs of the proceedings below. 44The respondent's solicitor had written a letter on 9 August 2012 to the Court, which was copied to the appellant, stating that the costs order had been made without the Court's having heard submissions on costs and indicating that the respondent wished to be heard on the question of costs. The letter specifically addressed the order made for the payment of costs of the proceedings in the Common Law Division. The respondent contended that a significant proportion of the costs incurred by the plaintiff were attributable to factual inquiries which related solely to causes of action on which the plaintiff failed. 45In Kable v State of New South Wales (No. 2) [2012] NSWCA 361 the Court of Appeal vacated the costs order made on 8 August 2012 concerning the costs of the proceedings in the Common Law Division. It made an order to "dispense with the requirement to give notice of the motion notified in the letter of the Crown Solicitor of 9 August 2012 in the prescribed form". Basten JA, who gave the leading judgment, did not refer to what he had said in AT v Commissioner of Police (NSW) (No. 2), but said (at [15]): "The interests of justice support an order dispensing with the requirement for the filing of a notice of motion in the prescribed form with respect to the costs of the trial. For that purpose the letter from the Crown Solicitor of 9 August 2012 should be deemed to be appropriate notice of the matter to which it referred." 46In the present case notice of the intention to apply for a gross sum costs order was not given within 14 days of the making of the final costs orders. I share the difficulty articulated by Basten JA in AT v Commissioner of Police (NSW) (No. 2) (with whose reasons Beazley and Macfarlan JJA agreed) in seeing how a power to dispense with the requirements of the rules assists a party who needs to rely upon the rule to provide the foundation for the Court's having the power to make an order varying or setting aside an order previously made, where the power of variation provided by the rule is subject to a limitation or restriction. As Basten JA pointed out in AT v Commissioner of Police (NSW) (No. 2), to dispense with the restriction on the power is not to dispense with a requirement of the rule, but to confer an additional power which the Court has no inherent jurisdiction to do if the proceedings have been finally disposed of (Bailey v Marinoff at 530 quoted at [20] above). 47Kable v State of New South Wales (No. 2) is authority that the Court can enlarge the power by dispensing with a requirement to file a notice of motion for the setting aside or variation of the judgment or order where notice of the order to be sought has been otherwise given within the period of 14 days provided by r 36.16(3A). But until the basis for the jurisdiction assumed is clarified, I do not think that the decision should be given a wider application. 48Moreover, the circumstances in Kable are arguably different from the present case. Having remitted the proceedings to the Common Law Division for the assessment of damages, the proceedings had been reinstated. The proceedings had not been concluded. The costs order for the payment of costs of the proceedings "to date" could not be considered to be a final costs order. There may have been no need to have recourse to any dispensing power under s 14 to amend the costs order made on 8 August 2012. The amendment could be made pursuant to the power conferred by s 98(3) for the Court to make an order as to the costs of the proceedings at any stage in the proceedings. 49If I had concluded that the court did not otherwise have power to make a gross sum costs order, I would not have concluded that such a power could be conferred by the making of an order under s 14 of the Civil Procedure Act dispensing with the requirement of the rules. For the reasons I have given I have concluded that the court is empowered to make a gross sum costs order, notwithstanding the delay in making the application.

Interest on costs 50The notice of motion sought an order for "Interest", which must mean interest on costs. 51Section 101 of the Civil Procedure Act relevantly provides: "101 Interest after judgment (cf Act No 52 1970, section 95; Act No 9 1973, section 85; Act No 11 1970, section 39) (1) Unless the court orders otherwise, interest is payable on so much of the amount of a judgment (exclusive of any order for costs) as is from time to time unpaid. ... (4) The court may order that interest is to be paid on any amount payable under an order for the payment of costs. (5) Interest under subsection (4) is to be calculated, at the prescribed rate or at such other rate as the court may order, as from: (a) the date or dates on which the costs concerned were paid, or (b) such later date as the court may order." 52Section 101 does not specify any time by which an application for an order under s 101(4) must be made. 53In Timms v Commonwealth Bank of Australia (No. 3) [2004] NSWCA 25, Beazley JA (as her Honour then was) dealt with a claim by successful appellants for interest on costs. On 23 September 2002, the Court of Appeal had ordered the respondents to the appeal to pay the appellants' costs of the appeal. The costs were assessed. On 19 November 2003 the costs assessor issued his certificate. The costs certificate was filed in the Court on 11 December 2003. Pursuant to s 208J(3) of the Legal Profession Act 1987 the amount of costs assessed became a judgment of the Court. By a notice of motion filed on or about 20 January 2004 the appellants sought an order for interest on the assessed costs as from the dates on which those costs had been paid. The claim was brought pursuant to s 95(4) of the Supreme Court Act 1970. That section provided: "If an order is made for the payment of costs, the Court may order that interest is to be paid on the amount so ordered, at the prescribed rate referred to in subsection (1), from the date or dates when the amount in respect of costs was duly paid." 54Beazley JA held that the effect of filing the costs certificate was that the appellants had obtained a final judgment in the amount of their assessed costs and that judgment conclusively determined the issues raised in the proceedings to which it related (at [9]). Her Honour said (at [9]-[12]): "[9] As already indicated, the effect of filing the Costs Certificate was that the claimants obtained a final judgment in the amount of the assessed costs. A final judgment, regularly entered, conclusively determines the issues raised in the proceedings to which it relates. It cannot ordinarily be set aside except in accordance with powers or rights otherwise conferred by statute or rule of court or in other well recognised circumstances such as fraud: Halsbury's Laws of Australia: para 325-9125. [10] The principle is well settled. In Bailey v Marinoff (1971) 125 CLR 529 Barwick CJ said at 530: Once an order disposing of a proceeding has been perfected by being drawn up as the record of a court, that proceeding apart from any specific and relevant statutory provision is at an end in that court and is in its substance, in my opinion, beyond recall by that court. It would, in my opinion, not promote the due administration of the law or the promotion of justice for a court to have a power to reinstate a proceeding of which it has finally disposed. See also Texas Co (Australasia) Ltd v Federal Commissioner of Taxation (1940) 63 CLR 382 at 457; DJL v Central Authority (2000) 201 CLR 226 at 240-245. The principle is also subject to the operation of the slip rule: Shaddock (L) & Associates Pty Ltd [No 2] (1982) 151 CLR 590 at 594-5. (The slip rule is itself encompassed in the Supreme Court Rules, Pt 20 r 10. [11] A claim for interest under s 95(4) is part of the claim that a party has in relation to costs. It is not a separate or independent cause of action. If no application for interest is made and determined before entry of judgment for costs, the claim for interest merges with the judgment for costs. That is what has occurred in this case. The claimants obtained a final judgment for their assessed costs when they filed the Costs Certificate on 11 December 2003. [12] Part 40 r 9 governs the setting aside or varying of a judgment or orders of the Court. The circumstances in which a judgment that has been entered may be set aside are limited and none apply here. There was no application made under the slip rule nor do the circumstances, on the evidence before me, indicate that the rule applies. The claimants' claim under s 95(4) appears to have been made without an appreciation of the effect of the judgment entered on 11 December 2003. In those circumstances, the only course available to the Court is to dismiss the motion with costs." 55The appellants' claim for interest on costs failed because the application for interest on costs was brought after the costs certificate had been filed as a judgment. 56In Roads and Traffic Authority v Cremona (No. 3) [2005] NSWCA 13 costs orders were made in the Court of Appeal on 7 December 2001. By a notice of motion filed on 2 September 2004, the successful respondent sought an order for interest on costs. The application was successful. Sheller JA said (at [20]): "The respondent has not yet filed a costs certificate in the Court pursuant to s 208J(3) of the Legal Profession Act 1987 and so the respondent is not prevented for [sic] making the claim for interest; compare Timms v Commonwealth of Australia & Ors (No. 4) per Beazley JA at [11]." 57In Simmons v Colly Cotton Marketing Pty Ltd [2007] NSWSC 1092, costs orders were made in favour of the applicants on 2 August 2005 and the orders were entered on 18 August 2005. An appeal by the respondents was unsuccessful. In 2007 the applicants sought an order for interest on the costs awarded to them on 2 August 2005. Bergin J (as her Honour then was) rejected a submission that the Court was functus officio and accepted a submission for the applicants that s 101(4) of the Civil Procedure Act contemplates that an order for interest may be made after entry of orders for costs (at [12]-[13]). Her Honour decided that interest on costs should be awarded. 58In Seiwa Australia Pty Ltd v Seeto Financial Services Pty Ltd (No. 2) [2010] NSWSC 118, Harrison J ordered the plaintiffs to pay the defendants' costs on 27 November 2008. Those orders were entered on 15 December 2008. On 11 August 2009 the Court of Appeal dismissed an appeal from his Honour's orders. After the dismissal of the appeal the defendants sought an order pursuant to s 101(4) of the Civil Procedure Act for interest on costs and disbursements. No application for assessment of costs had been filed and consequently there had been no certificate filed creating a judgment for a specified amount of costs. Harrison J followed Timms v Commonwealth Bank of Australia (No. 3) in holding that a claim for interest on costs was not a separate or independent cause of action, but because no final judgment had been obtained for the amount of the assessed costs, he was not functus officio and had power to make the order sought (at [17]-[20]). 59In Lucantonio v Kleinert & Ors (Costs) [2011] NSWSC 1642, Brereton J applied Seiwa Australia Pty Ltd v Seeto Financial Services Pty Ltd (No. 2) and Simmons v Colly Cotton Marketing Pty Ltd in saying that: "[26] It is clear that an interest order under Civil Procedure Act s 101(4) can be made after the costs order has been made, so long as it is made before there is a judgment for costs effected by registration of the certificate of assessment [see Seiwa Australia Pty Ltd v Seeto Financial Circumstances Pty Ltd (No 2) [2010] NSWSC 118, and Simmons v Poly Cotton Marketing Pty Ltd [2007] NSWSC 1092]. Accordingly, there is no question of the Court being functus officio at this point in respect of considering an application for interest on costs." 60In Drummond & Rosen Pty Ltd v Easey & Ors [2009] NSWCA 74 the appellant succeeded in having judgments entered against it in the District Court set aside and the Court of Appeal substituted judgment for it with costs. The Court ordered that any application for an additional or varied order as to costs or for restitution of moneys paid under the judgments that had been reversed was to be made by notice of motion filed within 14 days. The successful appellant filed a notice of motion within that period and the Court of Appeal by majority made an order for the payment of interest on costs of the appeal and the proceedings at first instance (Drummond & Rosen Pty Ltd v Easey & Ors (No. 2) [2009] NSWCA 331). Handley AJA dissented on the question of whether an order should be made for the payment of interest on costs. In the course of his reasons, Handley AJA explained that costs assessors did not have the power to allow interest on the costs as assessed (at [37]-[48]) and said: "[49] It follows therefore that the power in s 101(4) must be exercised by the court and under UCPR Pt 36 r 16 it must be exercised in the substantive judgment, or on a motion filed within 14 days thereafter. In my opinion the power should not be exercised without evidence of the amounts paid and the dates of payment." 61Macfarlan and Tobias JJA took a different view as to whether the power under s 101(4) could be exercised without evidence of the amounts of costs paid and the dates of payment but otherwise agreed with Handley AJA's reasons. Handley AJA did not elaborate upon the view expressed in the first of the sentences quoted from [49] above. His Honour did not refer to any of the contrary authorities. That sentence was not part of the ratio of the Court of Appeal's decision. 62In Zepinic v Chateau Constructions (Aust) Limited (Court of Appeal, 10 May 2010, unreported), Tobias JA dismissed a summons seeking leave to appeal and ordered the applicants to pay the costs of the summons for leave to appeal and the costs of a notice of motion seeking summary dismissal. His Honour would have been exercising the power of a single Judge of Appeal under s 46(1)(b) of the Supreme Court Act 1970 to dismiss a proceeding for want of prosecution or other cause specified in the rules. The order was entered on 10 May 2010. By notice of motion filed on 17 June 2013 the respondent to the application sought an order pursuant to s 101(4) of the Civil Procedure Act that the applicant pay interest on costs and disbursements allowed on assessment from the date of payment. The delay in making the application appears to have been largely due to delays caused by the party liable to pay costs. There had been other proceedings in the Supreme Court between the same parties in respect of which costs orders had been made in favour of the respondent and it had obtained an order for interest on those costs from the Supreme Court notwithstanding that the application was not filed within 14 days of the making of the costs order (Chateau Constructions (Aust) Limited v Zepinic [2013] NSWSC 909). In that case Robb J followed Timms v Commonwealth Bank of Australia (No. 3) at [8]). 63In Zepinic v Chateau Constructions (Aust) Limited (No. 2) [2013] NSWCA 227, McColl JA, sitting as a single Judge of Appeal in the exercise of the power conferred by s 46(1)(d) of the Supreme Court Act refused the application for an order for interest on the costs ordered by Tobias JA because the application was not made within 14 days of the entry of the costs order. Her Honour declined to follow Timms v Commonwealth Bank of Australia. Her Honour said (at [75]-[87]): "[75] I agree with her Honour that interest on costs should be sought before entry of judgment for costs however I disagree, with respect, with her Honour's view about what the critical date for that application was. [76] The entry of judgment on a filed certificate of a costs assessor or a review panel is a ministerial act, which makes the certificate enforceable as a judgment but otherwise does not alter its legal effect and does not make it a judgment of the court: Frumar v Owners of Strata Plan 36957 [2010] NSWCA 172 (Frumar) (at [40]) per Handley AJA (Macfarlan JA agreeing); see also Doyle v Hall Chadwick [2007] NSWCA 159 (at [49], [52]) per Hodgson JA (Mason P and Campbell JA agreeing). As Giles JA said in Frumar (at [8]) (in this respect agreeing with Handley AJA, albeit dissenting in the result), [s]o-called judgments under s 208J(3) of the 1987 [LP] Act, which is relevantly replicated in s 208KF(2), ... take their force from the statute and are not judgments of the court. [77] Handley AJA also doubted (Frumar at [42]) the 'validity of that part of [UCPR 36.10] which authorises the entry of judgment ... in view of s 208KF(2)(b) of the Legal Profession Act 1987 (and its successor s 368(5) of the 2004 Act) dealing with the effect of filing "with no further action"', but, on the assumption the rule was valid, reiterated that 'the entry of judgment on a filed certificate is a ministerial act [which] makes the certificate enforceable as a judgment but otherwise does not alter its legal effect.' [78] The consequence is that the effective costs judgment is that of the court, not that embodied on the costs assessor's certificate, even when filed: Field, Doyle, Frumar; see also Wilmot v Buckley (1984) 2 FCR 540 (at 543, 544) per Beaumont J; Van Reesema v Australian Growth Resources Corporation Pty Ltd (1987) 75 ALR 311 (at 318) per Morling, Sepnder and Gummow JJ). That conclusion reflects the practice at law, of entering up the amount of the taxed costs in the incipitur. [79] The consequence of that analysis is that the only costs judgment that is an order of the court is that given by Tobias JA which took effect on 10 May 2010: UCPR 36.4(1). [80] As to Mr Ilkovski's submissions concerning Drummond (No 2), in my view, properly understood, Macfarlan and Tobias JJA departed from Handley AJA's reasoning only insofar as his Honour expressed the view that the s 101(4) power should not be exercised without evidence of the amounts paid and the dates of payment. [81] It matters not that his Honour's view concerning when a s 101(4) application should be made as obiter, the application in that case having been made within the time permitted by UCPR 36.16. His Honour's view was clearly correct. As the foregoing analysis has made apparent, the power to award interest is found only in statute, now, relevantly, s 101(4) of the CP Act. Section 101(4) (more strictly, its predecessor, s 95(4)) was introduced to give the court a discretion as to the date or dates from which an interest on costs order would run. ... [82] However the interest order is made in respect of 'an order for the payment for costs': s 101(4). Just as a costs order must be sought at the time of judgment, or within any time limited by UCPR 36.16, so, too, in my view must an interest on costs order. That conclusion which accords Handley AJA's view in Drummond (No 2) and, subject to what I have said, Beazley JA's view in Timms, is consistent with the principle of finality of judgments: see D'Orta-Ekenaike v Victoria Legal Aid [2005] HCA 12; (2005) 223 CLR 1 (at [34]) per Gleeson CJ, Gummow, Hayne and Heydon JJ. [83] I have, however, given anxious consideration to the effect of UCPR 36.4(2), albeit that Mr Ilkovski did not seek to invoke it. As will be apparent, that rule substantially replicates SCR Pt 40, r 3(4) - a rule it is tolerably apparent was intended to give express effect to Master Allen's views in Field. On its face it applies only to an order for costs to be assessed which is not how Tobias JA's costs order was expressed. [84] Campbell JA explained the effect of UCPR 36.4(2) in Lahoud v Lahoud [2011] NSWSC 994 (at [38]-[39]) as follows. A costs order is a binding determination of rights from the time it is made, even though it cannot result in a judgment for a specific sum of money, nor be enforced, until the costs assessment is complete. Its meaning is also to be ascertained as at the date it is made. His Honour's analysis is consistent with that in Doyle and Frumar as to the effect of a cost assessor's certificate, even when filed. It also emphasises that the critical date for seeking an interest on costs order is when the costs order itself is made. [85] Mr Ilkovski's submission that the interest order is an additional order, rather than one within the meaning of UCPR 36.16, is simply semantic. An application for an order not made in the court's original orders is an application for a variation of a judgment or orders of the court, albeit that it would add an order, rather than amend an existing order. Although it is not determinative, that was how the court described the orders made in Drummond (No 2); see also Spedding v Nobles (No 2) [2007] NSWCA 87 (at [18]). The fact that the order was described as additional in Leda Pty Ltd v Weerden (No 2) emphasises the semantic nature of the argument. [86] Finally, I appreciate that there are first instance decisions of this court in which the view has been taken that an interest order under s 101(4) can be made after the costs order has been made, so long as it is made before there is a judgment for costs effected by registration of the certificate of assessment: Lucantonio v Kleinert (Costs) [2011] NSWSC 1642 (at [26]) per Brereton J. Those decisions do not, with respect, appear to have recognised the effect of such registration as explained in Doyle and Frumar. [87] The effect of Doyle and Frumar in my view, is that in order to determine whether an application for an interest on costs order is competent, the court is required to have regard to the date of the costs order. The fact that the cost assessors certificate has not been filed is not relevant." 64Neither the decision of Beazley JA in Timms v Commonwealth Bank of Australia (No. 4), nor that of Sheller JA in Roads and Traffic Authority v Cremona (No. 3), nor that of McColl JA in Zepinic v Chateau Constructions (Aust) Limited (No. 2), nor the first sentence of para [49] of the judgment of Handley AJA in Drummond & Rosen Pty Ltd v Easey & Ors (No. 2) is binding on me. They, of course, carry great weight, and to the extent they are not inconsistent with other appellate authority, they should be followed unless I considered them to be clearly wrong. But as a matter of precedent, for the reasons which follow, I am not bound to follow them. 65The first sentence of para [49] of the judgment of Handley AJA in Drummond & Rosen Pty Ltd v Easey & Ors (No. 2) was obiter. It could not be characterised as carefully considered obiter dicta as no reasons were given for the conclusion stated and none of the contrary authorities was referred to. 66The decision of McColl JA in Zepinic v Chateau Constructions (Aust) Limited (No. 2) was not given when her Honour was sitting as a member of the Court of Appeal in the framework of the appellate structure for appeals from judgments from the Supreme Court or lower courts (Bone v Commissioner of Stamp Duties [1972] 2 NSWLR 651 at 654; Appleton Papers Inc v Tomasetti Paper Pty Ltd [1983] 3 NSWLR 208 at 218; Businessworld Computers Pty Ltd v Australian Telecommunications Commission (1988) 82 ALR 499 at 504). Neither Tobias JA who dismissed the application for leave to appeal for want of prosecution or other cause specified in the rules with a consequential costs order, nor McColl JA who dealt with the application for interest on the costs as a matter incidental to the orders of Tobias JA, was determining the merits of any appeal or application for leave to appeal from a first instance judgment. 67The position may be different with respect to the judgment of Beazley JA in Timms v Commonwealth Bank of Australia (No. 4). In that case the Court of Appeal had allowed an appeal from Young CJ in Eq and ordered the respondents to pay the appellants' costs of the appeal. Beazley JA dealt with the appellants' notice of motion for interest on assessed costs. Although her Honour did not identify the jurisdiction she had as a single Judge of Appeal to deal with that application, her Honour must have been exercising a power conferred by s 46 of the Supreme Court Act. That section relevantly provides: "46 Powers of Judge of Appeal (1) A Judge of Appeal may exercise the powers of the Court of Appeal: (a) to give any judgment by consent or make any order by consent, (b) to dismiss an appeal or other proceedings for want of prosecution or for other cause specified in the rules, (c) to dismiss an appeal or other proceedings on the application of the appellant or plaintiff, or (d) to deal with costs and other matters incidental to the matters mentioned in paragraphs (a), (b) and (c). (2) A Judge of Appeal may exercise the powers of the Court of Appeal: (a) to make an order or give any direction concerning the institution of an appeal or other proceedings in the Court of Appeal, or (b) to make any order or give any direction in any appeal or other proceedings, but not an order or direction involving the determination or decision of the appeal or other proceedings. (3) Subsection (2) does not authorise a Judge of Appeal to grant or refuse leave to appeal to the Court of Appeal. ... (5) Subject to subsection (4), a judgment, order or direction given or made by a Judge of Appeal is to have effect as a judgment, order or direction of the Court of Appeal, whether or not the judgment, order or direction is within the powers of the Judge of Appeal under this section." 68In Roads and Traffic Authority v Cremona (No.3), Sheller JA said that he was exercising the power of the Court of Appeal in ordering interest on costs pursuant to s 46(2)(b) of the Supreme Court Act, i.e. the power to make an order not involving the determination or decision on the appeal. That decision was not given within the appellate framework for the determination of appeals. 69In Timms v Commonwealth Bank (No. 3), Beazley JA was presumably exercising the same power. If so, her Honour's decision also stands outside the appellate structure and is not binding. Beazley JA did not identify the power she was exercising as a single Judge of Appeal. However, it is possible, having regard to her Honour's finding at [11] of her reasons, that her Honour considered she was exercising the powers of the Court of Appeal to deal with costs and may have considered that the power to deal with costs under s 46(1)(d) was available, even if those costs were not incidental to the matters in s 46(1)(a), (b) or (c). If so, and Beazley JA was exercising the Court of Appeal's power to deal with costs following the successful appeal, then it is at least arguable that her Honour's decision is binding, subject to later appellate authority. 70It was an essential part of Beazley JA's reasoning (at [11]) that the claim for interest on costs was part of the claim that the appellant had in relation to costs, was not a separate or independent cause of action, and merged with the judgment for costs. 71The principle of res judicata or cause of action estoppel is that "the very right or cause of action claimed or put in suit has in the former proceedings passed into judgment, so that it is merged and has no longer an independent existence" (Blair v Curran (1939) 62 CLR 464 at 532), or to put it another way, "where an action has been brought and judgment has been entered in that action no other proceedings can thereafter be maintained on the same cause of action" (Jackson v Goldsmith (1950) 81 CLR 446 at 466; Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 at 597; Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502 at 507) (emphasis added). 72There is no inherent jurisdiction to order interest on costs (Nykredit Mortgage Bank plc v Edward Erdman Group Limited (No. 2) [1997] 1 WLR 1627 at 1635-1637). In McWilliams Wines Pty Ltd v Liaweena (NSW) Pty Ltd (1993) 32 NSWLR 190, Rogers CJ Comm D held that the power conferred by s 76 of the Supreme Court Act to order costs extended to making an order for interest on costs. In Woods v Woods [2001] NSWSC 1108, Hamilton J followed that decision in preference to the contrary decision of Goldberg J in White Industries (Qld) Pty Ltd v Flower & Hart (2000) 103 FCR 559 at 563-565. In Flower & Hart v White Industries (Qld) Pty Ltd [2001] FCA 370; (2001) 109 FCR 280 the Full Court of the Federal Court upheld the conclusion of Goldberg J that s 43 of the Federal Court of Australia Act 1976, which was in materially the same terms as s 76 of the Supreme Court Act, did not confer jurisdiction to award interest on costs. The Full Court also held that s 51A(1) of the Federal Court of Australia Act, which is in similar terms to s 100 of the Civil Procedure Act and confers power to include interest in a judgment on a cause for action in proceedings for the recovery of money, did not confer power to order interest on costs. 73Beazley JA did not refer to Flower & Hart v White Industries (Qld) Pty Ltd and evidently was not referred to it. That decision was approved by the Court of Appeal in Spedding v Nobles; Spedding v McNally (No. 2) [2007] NSWCA 87. It is now established that the power to order interest on costs is derived wholly from statute and is conferred by s 101(4) and not by s 98. The claim for interest on costs cannot merge in the general order for costs because it was not "the very right or cause of action claimed or put in suit", and was not the "same cause of action" as was determined by the final costs orders. 74Accordingly, even if the decision of Beazley JA in Timms was given within the appellate structure that would make it binding on me, its reasoning is inconsistent with other appellate authority, including the later decision of the Court of Appeal in Spedding v Nobles; Spedding v McNally (No. 2). 75In Zepinic v Chateau Constructions (Aust) Limited (No. 2) McColl JA appears to have approved of the judgment in Timms, except for the conclusion that it was on the entry of judgment on a filed certificate of a costs assessor or a review panel that was the relevant final order. 76In Zepinic McColl JA said that that conclusion was inconsistent with the decisions in Frumar v The Owners, Strata Plan 36957 [2010] NSWCA 172 and Doyle v Hall Chadwick [2007] NSWCA 159 that the filing of a certificate of a costs assessor or review panel was a ministerial act and not a judgment of the Court. Hence the relevant final order was the costs order, not the judgment obtained on filing the certificate of the costs assessment. McColl JA said that this conclusion was not affected by UCPR, r 36.4(2) because, for the reasons explained by Campbell JA in Lahoud v Lahoud [2011] NSWSC 994, the effect of that rule is only that an order directing the payment of costs is not enforceable by execution until the costs assessor's certificate is filed (at [38]). It is the making of the costs order by the Court that is the final determination of the parties' entitlement to costs. I consider that I should follow the reasoning of McColl JA in Zepinic that it is the final costs order of the court, and not the filing of the certificate of the costs assessor as a judgment, that is the relevant final order. 77In Zepinic McColl JA did not, with respect, analyse why the claim for interest on costs was barred because the costs order of Tobias JA was a final order, except to say that like an order for costs such an order must be sought at the time of judgment or within any time limited by UCPR, r 36.16 (at [82]). But why? Her Honour may have read UCPR, r 36.16(3) as if it provided that there is power to vary an order unless the order has determined a claim for relief, rather than that there is such a power except to the extent that a claim for relief is determined. 78At para [85] of Zepinic McColl JA said that the application was for a variation of the orders of the court, albeit by way of making an additional order. If that were so, r 36.16(3) would provide the requisite power to vary the costs order of Tobias JA unless the claim for interest on costs had been determined. As a matter of fact, the claim had not been determined. It had not been raised when Tobias JA made the costs order. It could only be said to have been determined if, as Beazley JA said in Timms, the claim for interest on costs had merged in the judgment for costs. For the reasons above, that was not the position. 79Nonetheless, I respectfully do not agree that if an order for interest on costs was made, such an order would vary the previous costs order. An order for interest on costs would vary the previous outcome, but not any previous order. Therefore the power to make such an additional order is not found in r 36.16. 80The orders of Tobias JA in Zepinic finally determined the proceedings. Likewise in this case the orders of the Court of Appeal finally determined the proceedings and left the 2008 costs orders undisturbed. In my view r 36.16(3) does not provide a power to make an order for interest on costs because such an order would not vary the costs orders made. No other power in r 36.16 is apposite. Prima facie, as the litigation is finally disposed of, it is at an end and no further application can be brought. But that is subject to contrary statutory provision. 81Section 98(3) of the Civil Procedure Act confers a power to make an order "as to costs" after the conclusion of the proceedings. If that power extends to the making of an order for interest on costs then the principles of finality of litigation are not offended because those principles are subject to contrary statutory provision. 82The Court of Appeal's decision in Roads and Traffic Authority v Palmer (No. 2) does not touch the present question. 83In my view, an order "as to costs" means more than "a costs order". Even though a separate statutory power is needed to make an order for interest on costs and even though, for that reason, a claim for interest on costs is not merged in a final order for costs, I consider that a claim for interest on costs is a claim "as to" costs within the meaning of s 98(3). The expression "as to" denotes a relationship between the order to be made and costs. It means "as it regards, so far as it concerns, with respect or reference to" (Oxford English Dictionary). An order for interest on costs has such a relationship. 84This construction of UCPR, r 36.16 and s 98(3) of the Civil Procedure Act is in accordance with the dictates of ss 56 and 57(2) of that Act. That can be illustrated by the facts in Roads and Traffic Authority v Cremona (No. 3) and Zepinic. In both cases the ground, or a substantial part of the ground, for seeking an order for interest on costs was the conduct of the judgment debtor after the costs order was made and the successful party had paid costs to her or its solicitor. In Zepinic it was claimed that the party liable to pay costs absented himself, and so delayed the costs assessment process, and then further delayed proceedings by appealing the assessment unsuccessfully to a review panel. In Cremona, the Roads and Traffic Authority failed to make any reasonable response to the successful plaintiff's attempt to negotiate a reasonable figure for costs and delayed the process of assessment. These are material considerations to the exercise of the discretion to award interest on costs. Unsurprisingly, the cases show that a party liable to pay costs can cause the process of assessment to be delayed, so that a judgment creditor, who may not have paid costs until after he or she has recovered a verdict, will be out of pocket until a certificate or assessment is filed. 85A construction of the Act and the Rules that requires a judgment creditor to seek an order for interest on costs when the costs order is made or within 14 days thereafter is likely to lead to unjust outcomes. At that time the successful party may not have paid costs. That is not a necessary bar to an order for interest on costs (Drummond & Rosen Pty Ltd v Easey & Ors (No. 2), but it may be a sufficient discretionary reason for refusing an order (Spedding v Nobles; Spedding v McNally (No. 2)). Events that occur well after the making of the costs order may well be highly relevant to whether an order for interest on costs should be made, as was the case in Cremona and was said to be the case in Zepinic. 86In Zepinic McColl JA did not address the question whether the construction of the Rules her Honour adopted was consistent with ss 56 and 57(2) of the Civil Procedure Act. Her Honour did not consider s 98(3) of that Act. 87For these reasons I respectfully consider that I should follow neither Timms nor Zepinic. I consider that s 98(3) confers power to make an order for interest on costs.

Orders 88For these reasons I answer the separate questions for determination as follows:

1. Q. Whether the Court has power to make the orders sought in the further amended notice of motion filed on 14 June 2013? A. Yes
2. Q. If the answer to 1. is yes, but only if the court dispenses with the requirement or requirements of the rules pursuant to s 14 of the Civil Procedure Act, whether the Court should dispense with such a requirement or requirements? A. Does not arise. 89Prima facie the plaintiffs are entitled to their costs of the determination of the separate questions. I will hear the parties on costs.

Amendments 28 October 2013 - Date in brackets in first sentence amended from 10 May 2013 to 10 May 2010. Amended paragraphs: 62 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: 28 October 2013