Costs at First Instance
28The costs at first instance that need to be reconsidered, as a result of the 2012 Appeal Judgment, are the costs of the strikeout motion, and the orders made at the conclusion of the Orders and Costs Judgment.
Cost of the Strike Out Motion
29Mr Epstein and Mr Bevan both accept that it is appropriate that the orders for costs made at first instance concerning the strike out motion be set aside. Mr Epstein submits that, in lieu, there should be an order that the Respondents pay the costs of the Appellants of that Notice of Motion. Mr Bevan does not propose any particular specific order concerning the costs of the Notice of Motion. Adopting that course would have the effect that the costs of the Notice of Motion would be disposed of in the same way as the general costs of the first instance proceedings.
30A fact that will need to be taken into account concerning the costs of the Notice of Motion is that this Court has already made an order that Mr Holmes have an order for judgment, with costs of the hearing at first instance. That order would itself carry the costs of interlocutory motions that were not separately ordered to be paid. However, the Court's order also reserved the question of what further orders should be made to give effect to the reasons for judgment. Thus the question of Mr Holmes' costs concerning the Notice of Motion remains for decision.
31Mr Epstein submits, concerning both the costs of the strike out motion and the general costs of the first instance hearing, that the Respondent should pay the Appellants' costs (or, concerning the general costs of the first instance hearing, a high proportion of those costs) because the incorrect decision arrived at concerning the strike out motion and the miscarriage of the first trial were both attributable to the "fault" of the Respondents. He recognises that when an appellate court sets aside orders made at a trial and orders that there be a new trial, a principle often followed is that the costs of a first trial are ordered to follow the event in the new trial. However, he submits that that usual practice is inappropriate when it is the fault of one of the parties that a second trial is required to be held: Stewart v McKinley (1885) 11 VLR 802 at 809-810; Malpas v Malpas (1885) 11 VLR 670 at 710-711; Morgan v John Fairfax & Sons Limited (1988) 13 NSWLR 208; Monie v Commonwealth of Australia (No 2) [2008] NSWCA 15 at [55]-[61].
32In Brittain v The Commonwealth of Australia (No 2) [2004] NSWCA 427, McColl JA (Handley and Tobias JJA agreeing) explained at [30] the rationale for the usual practice, and this exception from it:
"The logic of the general rule is manifest. While the Court has a plenary discretion concerning costs (s 76 Supreme Court Act), the ordinary principle is that costs follow the event: Pt 52A r 11. Where a new trial is ordered the parties' rights have not been finally determined. The identity of the successful party has not been established. The general rule is clearly intended to ensure that the ultimate costs order reflects the ordinary principle when the parties' rights are finally determined. Departures from the general rule are intended to deal with situations where its application would lead to injustice."
33In Brittain, McColl JA held, in a situation where the sole cause of a new trial was that one party had requested the trial judge to give to a jury a direction that the Court of Appeal ultimately held was erroneous, it was unjust for the usual principle to apply. Rather, her Honour held that the appellant had been put to the expense of a new trial solely because of the erroneous direction that the respondent had caused the judge to make, and in those circumstances it was appropriate for the respondent to pay the appellant's costs of the first trial on an indemnity basis.
34Mr Epstein submits that that approach should be adopted concerning the Notice of Motion, because in the Strike Out Judgment the judge accepted, either with attribution identified by quotation of the submissions in the judgment, or without attribution by repetition of their substance, submissions that the Respondents had made to him. It is correct that the Strike Out Judgment arose from the primary judge adopting submissions of the Respondents.
35Mr Epstein also submits that other than with respect to parts of their pleadings which the Appellants did not press, the Notice of Motion should have been dismissed with costs. The parts of the pleadings that he identified as ones which the Appellants did not press were paragraphs 32-40 of the defence of Mr Fredericksen, and corresponding paragraphs in the defences of Messrs Atkinson and Long, and Ms Spyrakis. That was an estoppel pleading, based upon representations by Mr Lloyd and other identified people on behalf of the Respondents to Mr Gianuzzi at the Ord Minnett seminar. It pleaded that Mr Gianuzzi passed that representation on to Mr Fredericksen. The judge noted, at [63] of the Strike Out Judgment, that Mr Fredericksen's defence of "waiver" was no longer pressed.
36Contrary to Mr Epstein's submission, it is not the consequence of the 2012 Appeal Judgment that the strike out motion should have been dismissed with costs. Order 2 that the primary judge made on 29 April 2010 struck out pleadings that, in substance, contended that a payment had been made punctually because a cheque for the payment had been put in the post prior to the due date. Order 2 granted liberty to replead those paragraphs, as set out in Schedule A to the orders, to contend that there had been punctual payment because the cheque in question had been received on or before the due date.
37In any event, in my view, the approach adopted in Brittain is not applicable concerning the costs of the Notice of Motion. The issues argued in the Notice of Motion will not be re-agitated at the remitted hearing. An important element in the injustice that was recognised in Brittain was that the appellant would be exposed to the costs of two trials on the same issues because of the erroneous submission of the respondent. That situation will not arise in the present case, so far as the costs of the Notice of Motion are concerned.
38Mr Bevan contends that no separate order should be made concerning the costs of the Notice of Motion, because if the Appellants (presumably, other than Mr Holmes) fail at the remitted hearing there will be no event to which they can point that supports their victory on an interlocutory hearing on appeal.
39I do not accept that submission, because it focuses on only one possible outcome at the remitted hearing.
40Rather, the costs of hearing the strike out motion should be borne in a way that takes into account this Court's decision concerning the issues involved in that motion. Each party has had a measure of success concerning those issues.
41The costs order should also recognise that the strike out motion was an interlocutory application. In accordance with Metropolitan Petar v The Macedonian Orthodox Community Church St Petka Inc (No 2) [2007] NSWCA 142 at [16]-[32], it is often appropriate, when a party has been successful in an interlocutory application, the costs of that application be that party's costs in the cause. However, in this case neither party has been wholly successful in the application. The significance and difficulty of those issues on which the Appellants succeeded was approximately equal to that of those on which the Respondent succeeded. In my view the appropriate principle to effect by the costs orders concerning the Notice of Motion is that each side should have fifty percent of the costs of the Notice of Motion as their respective costs in the cause.
42That principle, applied to Mr Holmes, would produce a result that he should have, now, an order for fifty percent of his costs of the strike out motion. I return later, at [81], to how one quantifies his costs of the strike out motion, bearing in mind that he was jointly represented on the motion. It also gives rise to a question of what, if anything, should be done concerning the orders made against the non-appealing defendants for the costs of the Notice of Motion. I also return later, at [81], to that question.
Other Costs of the Trial
43Mr Bevan submits that, so far as Appellants other than Mr Holmes are concerned, the order made below for the costs of the trial should not be disturbed.
44Mr Bevan submits that one reason why the order for costs made at the trial should not be disturbed is that some of the defendants who have suffered judgment at the trial have not appealed against the failure of their defences and cross-claims, and their costs liabilities are inextricably bound up with those of the Appellants. While his submissions did not spell out how it happened that the costs liabilities of the non-appealing defendants were bound up with those of the Appellants, it is not hard to see how that is so. Under the joint and several costs order that was made in the court below, it would be open to ARF to seek to enforce the whole of the costs order against whichever defendant appeared to be the easiest target, and leave that defendant to seek to recover contribution from the other defendants who were liable to meet the same obligation. If the costs order remained in its present form, and an Appellant were to succeed in escaping or lessening his or her liability to pay costs, the non-appealing defendants could be prejudiced through having less extensive rights of contribution available to them.
45Mr Epstein submits that it is a consequence of the decision in the 2012 Appeal Judgment that the costs orders made by the primary judge in his final orders will now be set aside against the nine Appellants, and that in those circumstances it is no longer appropriate that the costs order should operate in its existing terms against the remaining defendants. He submits that Ms Michael should be ordered to pay so much of the costs as are properly attributable to her severally, Ms Spyrakis should pay so much of the costs as are properly attributable to her severally, and Ms Michael and Ms Spyrakis should pay jointly and severally two-elevenths of the costs that are properly attributable to the eleven defendants jointly. This submission is made on the basis that there were eleven defendants who were continuing at the time the costs orders were made, rather than the twelve who were actually continuing. It accepts that those non-continuing defendants against whom this Court now makes an order concerning the costs at first instance should, as between themselves, bear costs jointly and severally.
46An important basis upon which the primary judge decided to order that the defendants should all be liable jointly and severally for the plaintiff's costs was that all the defendants had been unsuccessful. The effect of Mr Holmes having succeeded in obtaining judgment on the appeal is that that situation no longer applies. In Currabubula Holdings Pty Ltd v State Bank NSW (2000) NSWSC 232 at [90]-[106], Einstein J helpfully collected the authorities relating to the circumstances in which it is appropriate for a court to order that unsuccessful defendants pay their several proportionate shares of the costs incurred by the plaintiff (a "per-defendant order"). Such an order can be appropriate where a plaintiff sues several defendants, the defendants appear by the same solicitor, and the plaintiff succeeds against some but not all of the defendants. His Honour summarised the rationale for the principle, at [95], as being:
"... to achieve substantial justice in the awarding of costs as between a partially successful plaintiff and variously successful and unsuccessful defendants. The rule operates upon the premise that defendants are proportionately responsible for and liable for the joint costs involved in mounting the defence. Thus, a successful defendant cannot claim from the plaintiff more than a proportionate share of the joint costs of the action in addition to any costs separately referable to that defendant. Conversely, the partially successful plaintiff is prevented from looking to each of the unsuccessful defendants for more than an equal proportionate share of the costs not solely referable to the plaintiff's case against one or other of the defendants individually, in addition to the costs which are so referable. In this way, the rule of thumb prevents both the unjust enrichment of the partially successful plaintiff or successful defendant and the casting of an unfair burden on the unsuccessful defendants. Where the premise is falsified or the rule does not achieve its intended effect, it finds no application."
47Einstein J gave as an example of a situation where "the premise is falsified or the rule does not achieve its intended effect", the situation considered in Korner v H Korner & Co Ltd [1951] 1 Ch 10. There, seven of eight defendants had succeeded, but their success had been on issues that were not the substantial issue in the action. It was held that it would be unjust, in that situation, for the successful defendants to recover seven-eighths of the total costs incurred by the defendants in defence of the action.
48The fact that Mr Holmes has succeeded in his defence gives scope for Mr Epstein's argument that, insofar as the non-appealing defendants are concerned, a per-defendant order should be made concerning the costs of the first trial.
No Jurisdiction to Make Orders Benefiting Non-Parties to the Appeal?
49To counter that argument, Mr Bevan submits that this Court does not have jurisdiction to make costs orders that would have an effect of benefiting non-parties to an appeal.
50I do not accept that this Court would lack the jurisdiction to make such an order. The present appeal is brought under s 75A Supreme Court Act 1970. The relevant provisions of that section are:
"(5) Where the decision or other matter under appeal has been given after a hearing, the appeal shall be by way of rehearing.
(6) The Court shall have the powers and duties of the court, body or other person from whom the appeal is brought, including powers and duties concerning:
(a) amendment,
(b) the drawing of inferences and the making of findings of fact, and
(c) the assessment of damages and other money sums.
...
(10) The Court may make any finding or assessment, give any judgment, make any order or give any direction which ought to have been given or made or which the nature of the case requires."
51Purely as a matter of statutory construction, I would reach the conclusion that, if the success of Mr Holmes on the appeal had the consequence that it was no longer appropriate for the joint and several costs order to remain, replacing it with a per-defendant costs order (or whatever other order was appropriate, in light of the facts of the individual case) would be an order that "the nature of the case requires", and thus justified by s 75A(10), even if that replacement order had the incidental effect of benefiting someone who had not appealed.
52That conclusion, arrived at solely as a matter of construction, is consistent with previous decisions concerning appeals made under somewhat different statutory provisions.
53Attorney-General v Simpson [1901] 2 Ch 671 arose when the Attorney-General and a county council brought an action that sought to establish on behalf of the public a right of free passage in a river. The defendant was the successor in title of the constructors of certain locks located in the river. At first instance, Farwell J had held that prior to 1628 there had been no right of free passage arising under the general law by virtue of the river being navigable, because it had not been navigable until the locks were constructed. Construction of the locks had occurred pursuant to some letters patent granted to predecessors in title of the defendant in 1628 and 1638. Farwell J held that the 1628 letters patent were valid, while the 1638 letters patent were invalid. The 1628 letters patent conferred a right to charge a toll for a period that ended in 1718, but did not expressly confer any obligation to maintain the works. At first instance the plaintiffs had argued that the judge should infer that there was a lost grant in or after 1718 that conferred a right to charge a toll, subject to an obligation to repair and maintain the locks, but Farwell J declined to infer that there had been such a grant. He made a declaration that there was a right of free passage in the river, subject only to the payment of certain charges imposed by a particular statute from the time of George I, and that the defendant was not under any liability to maintain or work any of the locks (700).
54On appeal to the Court of Appeal, the view was taken that the 1638 grant was the operative one, and that it conferred a right to collect tolls that lasted for so long as the defendant kept the works in such repair as to keep the river navigable (per Vaughan-Williams LJ at 712-713). At 718-719, Stirling LJ took what appears to be a wider view, that the grant was subject to the obligation of maintaining and working the locks. The Court of Appeal made a declaration that the defendant was bound to maintain the locks (720).
55Relevantly for present purposes, the plaintiffs had not appealed against the portion of Farwell J's judgment that declared that the defendant was not bound to maintain or work the locks. At that time, order LVIII r 4 conferred on the Court of Appeal power "to give any judgment and make any order which ought to have been made, and to make such further or other order as the case may require". Stirling LJ said, at 720, that:
"The order confers power to do this, although the appeal may be from part of the judgment only, and although the respondent may not complain of the decision."
Vaughan-Williams LJ at 713 agreed that there was power to make the declaration.
56The decision of the Court of Appeal was reversed by the House of Lords, (Simpson v Attorney-General [1904] AC 476). Their Lordships rejected as a matter of substance the basis upon which the Court of Appeal had held that there was an obligation to maintain, but did not question the power of the Court of Appeal to make the declaration. See especially per Lord Macnaghten at 489-492, Lord Robertson (496) and Lord James (508) agreeing.
57Rutherford v Rutherford [1922] P 144 arose when a wife presented a petition for dissolution of marriage based on her husband's cruelty, and his adultery with a Miss Richardson on one occasion. The husband did not defend the petition, but Miss Richardson obtained leave to intervene and denied the adultery. The trial judge found that both cruelty and adultery were established, and granted the divorce. Miss Richardson appealed to the Court of Appeal. Atkin LJ recorded, at 160, that the husband did not appeal, and "the notice of appeal, so far as I can see, was not served upon him." The Court of Appeal was persuaded that the evidence did not establish that adultery had occurred. At the time, a finding of cruelty would justify a court in making a decree of judicial separation, but was not a sufficient basis for a decree of dissolution of marriage. The Court of Appeal ordered that the petition be dismissed, and a decree for judicial separation on the ground of cruelty be made (161). Atkin LJ at 160-161 specifically considered the power of the Court to make such an order in circumstances where the husband was not a party to the appeal. At the time, the relevant English rule, order LVIII r 4, conferred upon the English Court of Appeal powers:
"... to draw inferences of fact and to give any judgment and make any order which ought to have been made, and to make such further or other order as the case may require. The powers aforesaid may be exercised by the said Court, notwithstanding that the notice of appeal may be that part only of the decision may be reversed or varied, and such powers may also be exercised in favour of all or any of the respondents or parties, although such respondents or parties may not have appealed from or complained of the decision. The Court of Appeal shall have power to make such order as to the whole or any part of the costs of the appeal as may be just."
58Atkin LJ held, at 161, that:
"... the right order for this Court to make is the order that the Court below ought to have made if it had taken the same view of the facts as this Court took at the hearing of the appeal".
59Lord Sterndale MR and Warrington LJ both ordered that the petition should be dismissed, though without any express consideration of the power of the Court of Appeal to do so in the absence of the husband.
60The decision of the Court of Appeal was upheld by the House of Lords: Rutherford v Richardson [1923] AC 1. Viscount Birkenhead, at 7, said:
"In my view it is open to the Court of Appeal to pronounce the decree of judicial separation which the judge, if he had determined the other issue differently, might have pronounced in the first instance. By not defending either issue, B. had put it out of his power to prevent the judge from making a decree of judicial separation in his absence. How can B. reasonably complain if, also in his absence, the same decree is made by the Court of Appeal?"
61After observing that marriage was more than a simple contract that was able to be dissolved consensually, and that the power of dissolving it depended upon the court being satisfied that adultery had actually taken place, he continued, at 8:
"Similarly, when a Court of Appeal decides that a decree of dissolution, duly brought before it for review, ought not to have been pronounced, its duty must be to pronounce the right decree in the whole matrimonial cause, and not merely to limit its conclusion to the issue raised between the parties who have been served with notice of the appeal or have chosen to appear before it. Otherwise the result would be that, by the voluntary act of a party in regard to the conduct of legal proceedings, a competent Court might allow a marriage to be dissolved on the footing that adultery had occurred, while declaring that no such adultery had really taken place."
Lord Dunedin, Lord Atkinson and Lord Sumner agreed with those reasons. The case is not one that exemplifies the appeal court conferring a benefit on a non-party to the appeal: one cannot tell whether the husband regarded it as a benefit or a burden to remain married (or, as he had been committed to a lunatic asylum, as neither). However, it is authority for it being the duty of the Court of Appeal to make such order, on appeal, as should have been made below, even in circumstances where the order affects a non-party to the appeal.
62In Hanson v Wearmouth Coal Co Ltd and Sunderland Gas Co [1939] 3 All ER 47 a plaintiff's house had been damaged by an explosion caused by gas escaping from a broken main. The main broke because the ground in which it was laid subsided, as a result of mining taking place below the surface. The plaintiff sued both the gas company and the mining company. At first instance the plaintiff obtained judgment against the gas company alone. The gas company appealed. The plaintiff did not appeal against the judgment in favour of the mining company. The gas company appealed unsuccessfully against the findings that it had been negligent, and that it was not entitled to recover contribution from the mining company. However, Goddard LJ, delivering the judgment of the court, rejected at 55 a submission that, as the plaintiff had not appealed against the judgment entered for the coal company, the appeal of the gas company was incompetent insofar as it sought to have the coal company held liable for contribution. He said, at 55:
"The gas company were entitled at the trial, by reason of the provisions of the Law Reform (Married Women and Tortfeasors) Act 1935, to show, if they could, that the coal company were liable in whole or in part for the accident so as to obtain the benefit of indemnity or contribution given by the Act. The duty of the court below was to decide on the rights of the parties at the date of the writ. The Court of Appeal must rehear the case and give the judgment which ought to have been given below, and, if the judgment below should have been that both defendants were liable, so that a right of contribution would arise, this court has power to enter judgment accordingly, even though the plaintiff be content with judgment against one defendant."
63Consistency with James Hardie & Coy Pty Ltd v Seltsam Pty Ltd [1998] HCA 78; (1998) 196 CLR 53 would require, if an identical case were heard in New South Wales today, that the gas company have appealed against the judgment in favour of the mining company (at [20]). However, if that step were taken, it would be open to this Court to make similar orders to those the English Court of Appeal contemplated in Hanson. Hanson provides an example of the court holding it had power on an appeal to make an order that benefits a non-party, because in the situation Goddard LJ was considering the appeal would have resulted in the plaintiff having two sources from which to seek recovery. (No such order was in fact made, because the case against the coal company was not made out.)
64In re Whiston; Whiston v Woolley [1924] 1 Ch 122 concerned the construction of a will of a testator who had twice married, who had had three children by each wife, and survived both wives. His second wife had died intestate, as a consequence of which the testator had inherited certain of her property. His will made specific bequests concerning the property he had inherited on that intestacy. It provided for the specific property to be used to pay certain pecuniary legacies to the three children of his first wife, and the residue of the specific property to be given to the three children of the second wife, who were named. His will left the residue of his estate on trust for his six children equally, by name. At the time of the will one of the sons of the testator's second marriage, Philip, had been killed in the War, but the testator refused to believe that he was dead. Eve J held, at first instance, that the one-third share of the specific property that had been given to Philip lapsed and fell into general residue, and that the whole residue passed to the five children who survived the testator. The two surviving children of the second marriage appealed against the decision that the one-third share of the specific property lapsed and fell into general residue. They argued that it had not lapsed, and should be divided amongst the two surviving children of the second marriage.
65In substance, the Court of Appeal held that Eve J had been right in holding that the surviving two children of the second marriage did not receive the lapsed share of the specific property, but that he had been wrong in holding that the general residue of the testator's estate was divisible between the five surviving children. That had the consequence that, insofar as Eve J had held that the one-third of the specific property that lapsed was divisible amongst the five living children, it was incorrect. Instead, it should have been declared that in regard to one-sixth of that one-third there had been an intestacy. Warrington LJ noted, at 131, that the declaration that Eve J had made concerning the residue was incorrect, and that there was no appeal from that declaration. He said, at 132, that although the declaration concerning the residue "has not been appealed from I do not think we ought to allow the order to go without amendment". At 133, he proposed the order that the Court ultimately made, which included a declaration:
"... in the events which have happened the one-sixth share of Philip in the testator's residuary real and personal estate (including his one-sixth of the one-third of the property of the testator's late wife which fell into residue as above mentioned) was in the events which happened undisposed of and passes as to the real estate to the testator's heir at law and as to the personal estate to the testator's next of kin."
66Sargant LJ, at 134, raised a suggestion that was ultimately adopted in the orders of the Court:
"... although the specific gift of the wife's property deals only with the personal estate, I notice in the affidavit that the testator's residue, apart from the lapsed share of the specific property, does comprise a considerable amount of real estate. Therefore there will, with regard to that, be a difference caused by our decision from the effect produced by Eve J's decision. I see that there is no appeal by the heir at law, who was the person really prejudiced, against a decision which deprived him of his special rights in the real estate, but I suggest the proper way would be that we should give leave to the heir at law to appeal, notwithstanding that the time may have elapsed."
67He continued, at 134-135:
"I remember one or two cases where beneficiaries under a trust who were on the same footing had a decision given against them, and there was an appeal to this Court only by one or two of the beneficiaries, and not by all, and the Court having put a construction on the trusts of the will on that appeal which was favourable to those beneficiaries, went on to say that although the other beneficiaries had not appealed, it must necessarily follow from the construction put by the Court on the trusts that they would, in the result, get the benefit of the appeal, although they had not run the risk of the appeal."
68One can see why the court granted leave to the heir at law, rather than simply modifying Eve J's declaration concerning the residue. The appeal of the two surviving children on the second marriage failed, and no amendment of any declaration of the primary judge was necessary to give effect to their decision that the appeal should be dismissed. It is the situation referred to in Sargant LJ's remarks that I have set out at [67] above that it provides the analogy with the present case.
69Chappuis v Filo (1990) 19 NSWLR 490 arose when a pharmacist contracted to sell the goodwill and other assets associated with the professional side of his pharmacy business to another pharmacist, and to sell the goodwill and assets associated with the non-professional part of his business to a non-pharmacist. The purchasers did not complete the contract. The vendor obtained judgment against each of them. The pharmacist purchaser appealed, but the other purchaser did not. The other purchaser was named as second respondent to the appeal, but was not served, and there was no reason to believe that he knew of the appeal. Priestley and Handley JJA held that the contract did not contravene the provision of the Pharmacy Act 1964 which prohibited a person who was not a pharmacist from having a pecuniary interest in the business of a pharmacist. However, they held that the judge had been mistaken in the construction of the provision of the contract that required each purchaser to pay for stock. They held that the contract with the pharmacist purchaser required him to pay for the stock of the professional side of the business, while the contract with the non-pharmacist required him to pay for the stock of the non-professional side of the business.
70Priestley and Handley JJA said, at 511-512:
"Earlier we referred to the fact that this Court had proceeded to hear this appeal without having been satisfied that the second respondent had received any or sufficient notice of the existence of the appeal and the date fixed for the hearing. The result, so far as the second respondent is concerned, has been that his liability to the vendor will be reduced by $13,600 plus judgment interest. However he has also been deprived of his right of contribution from the appellant which as between the two purchasers would have left him ultimately responsible for only half of the judgment entered by the trial judge.
Since the second respondent elected not to appeal against the several judgment against him for $57,500 there is no reason why this Court should not exercise its powers under the Supreme Court Rules 1970, Pt 51, r 15, to vary the judgment against the second respondent to reflect the variation in the judgment against the appellant so as to leave in existence a final judgment against the second respondent for the reduced amount. If the procedure adopted by the Court has unwittingly deprived the second respondent of his right to be heard, without any fault on his part, and if he has been prejudiced by these orders he would have the right to apply to have these orders, which so far as he was concerned were pronounced ex parte, set aside: see Taylor v Taylor (1979) 143 CLR 1."
71Kirby P dissented in the result. He would have held that the contractual arrangements contravened the Pharmacy Act, and would have dismissed the vendor's action. He also would have made orders to that effect, notwithstanding the absence of the second respondent. He said, at 492:
"The orders which I propose can only benefit the second respondent. Accordingly, notwithstanding the care which must be taken in making orders against an absent party unaware of a change in the formulation of the case, I consider that it is safe and just to proceed to my orders: cf Banque Commerciale SA En Liquidation v Akhil Holdings Ltd (1990) 64 ALJR 244."
72The same conclusion about the jurisdiction of this Court to make a costs order that benefits a non-party can be reached by another route. Section 75A(6) Supreme Court Act confers on the Court of Appeal all the powers of the court from which the appeal is brought. The court at first instance had the powers conferred by s 98 Civil Procedure Act 2005:
"(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.
....
(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."
That includes power to decide how the costs should be borne as between any of the parties to the first instance proceedings (or, indeed, against non-parties).
73For these reasons, I would reject the submission that this Court lacks the jurisdiction to make costs orders that confer a benefit on non-parties to an appeal.
Decision Re Costs at First Instance
74Thus, I return to consider the order concerning costs at first instance on the basis that there is no jurisdictional obstacle to the court making a costs order that incidentally confers a benefit on a non-appellant.
75I accept that the success of Mr Holmes has the consequence that the order for all the continuing defendants to be jointly and severally liable for the costs of first trial should not stand. So far as the three non-appealing defendants (including Mr Atkinson) are concerned it should be replaced by a per-defendant costs order of the type that Mr Epstein seeks.
76There has been no challenge to the correctness of the principle that the primary judge applied, that any costs which the plaintiff had already recovered by way of settlement inclusive of costs should be subtracted from the costs that otherwise would be assessed as being recoverable against the defendants. That principle should be reflected in the drafting of the per-defendant costs order.
77I have concluded that, subject to that per-defendant order, and the order I propose concerning the costs of the Notice of Motion seeking the striking out, the costs of the first trial should be in the discretion of the judge who hears the remitted trial.
78It would not be appropriate, in the present case, to make the order that is frequently made when a new trial is ordered, that the costs of the first trial follow the event in the new trial. That is because there are some issues that were litigated at the first trial, concerning whether individual defendants had paid punctually, on which the Appellants lost, which will not be re-litigated at the second trial.
79Mr Bevan submits that an additional respect in which the scope of issues at the remitted hearing will not be the same as the scope of issues at the first trial is that the primary judge did not decide whether any of the amended pleadings should have been disallowed on the basis that they raised causes of action statute barred under a limitation provision. The orders of 16 March 2010 had raised the possibility that that might provide a basis upon which ARF argued that the amendment should not be allowed - [5] above. I would not be prepared to either adopt or reject that as an additional reason for this Court leaving it to the remitted hearing to decide how the costs of the first trial should be borne. That is because there has been no investigation on the appeal of the circumstances in which the primary judge did not deal with the question of whether the proposed amendments should be disallowed on the basis that they were statute barred. If it were correct that the amended pleadings raised statute barred causes of action, that might have provided a reason why the primary judge's striking out of the estoppel and Contracts Review Act defences was correct. No such argument was raised in this appeal by a Notice of Contention. It is at least a possibility that it is now too late to raise any such argument. Whether that is so should be decided by a judge before whom the issue has been properly litigated.
80Further, the outcome of the remitted issues might themselves bear upon the proper order that should be made concerning the first hearing. For example, if the Appellants were to succeed in an expanded Contracts Review Act defence, that might give rise to an argument of the type Mr Epstein now puts forward, that the costs of the first trial, insofar as they related to the narrower Contracts Review Act defence there litigated, were wasted by the fault of the Respondents.
Returning to Costs of the Notice of Motion
81In light of that discussion, I return to the costs order that should be made concerning the non-appealing defendants and the notice of motion. In circumstances where they have irretrievably failed in the action, the effect of the principle that all defendants should have fifty percent of the costs of the notice of motion as their costs in the course, and that ARF should have fifty percent of the cost of the notice of motion as its costs in the cause is that the non-continuing defendants should pay 50% ARF's cost of that motion. Further, there should be a per-defendant costs order, of the type that Mr Epstein seeks, in relation to those costs.
82The costs of Mr Holmes concerning the Notice of Motion should likewise be identified by a per-defendant costs order, entitling him to be paid, now, fifty percent of one-twelfth of the total costs incurred by the defendants concerning that notice of motion.