Appeal and New Trial - Appeal - General principles - Right of appeal - When appeal lies - Error of law - Particular cases involving error of law - Denial of natural justice - Failure to allow opportunity to be heard about whether costs should be paid forthwith or "in any event".

Appeal and New Trial - Appeal - General principles - Interference with discretion of court below - Particular cases - Other matters - Costs - Discretion to order costs to be paid forthwith or "in any event".

Procedure - Civil proceedings in State and Territory courts - Costs - Recovery of costs - Time for payment - Rule of Court that costs in the cause of the party in whose favour application determined - Power to "otherwise order" - Operation of the general rule delaying payment until the end of the principal proceedings - Where costs awarded to a party otherwise than in accordance with rule - Whether party should be entitled to immediate taxation and payment - Relevant factors.

Supreme Court Rules 2000 (Tas), r 65(a).

Gunns Limited v Alishah (No 3) [2009] TASSC 103, 19 Tas R 401

Woods v Deputy Commissioner of Taxation (No 2) [2012] TASSC 11, 21 Tas R 234, applied.

WEEDING PARTY HIRE PTY LTD v SALTERS (TAS) PTY LTD

1. Order of Marshall AJ made 18 March 2025 set aside.
2. Order that the respondents' costs thrown away by reason of the adjournment of the trial granted by Marshall AJ on 6 February 2025 are to be paid by the appellant in any event.

WEEDING PARTY HIRE PTY LTD v SALTERS (TAS) PTY LTD

1. I have read the reasons for judgment of Pearce J. I agree that the appeal should be upheld and would join in the orders proposed.

WEEDING PARTY HIRE PTY LTD v SALTERS (TAS) PTY LTD

1. This is an appeal from a costs order made by Marshall AJ. The order was made on 18 March 2025 following determination by his Honour of the appellant's successful application for adjournment of the trial of an action. The order is expressed in these terms:

"The plaintiff is to pay forthwith the defendants' costs thrown away by the adjournment."

1. In this appeal the appellant does not challenge the order to the extent that it provides that it should pay the costs thrown away by the adjournment. What is challenged is the order that the costs be paid "forthwith." For the following reasons the appeal should be allowed.
2. The costs issue arose in these circumstances. The action, brought by the appellant as plaintiff, concerns a written agreement entered into by the parties for the sale of a business by the first respondent to the appellant for $5.5 million. Part of the purchase price was payable by a loan of $2,750,000 provided by the appellant to the first respondent. It was a condition precedent to completion of the sale agreement that the loan agreement would be executed by the parties on or before the completion date, specified as 1 September 2023 "or such other date as the parties may agree in writing". The appellant seeks to enforce the agreement. The determinative issue on the pleadings is whether an agreement was reached between the appellant and the first respondent to extend the date of completion to 8 September 2023.
3. The trial of the action was listed to begin on 24 February 2025. On 6 February 2025 the learned primary judge heard an application made by the appellant for an adjournment of the trial. The adjournment was sought to enable the appellant to pursue appeals against two interlocutory orders refusing access to documents on the respondents' solicitors file which had been referred to in an affidavit. The first order appealed against was made by Daly AsJ on 6 December 2024 dismissing the appellant's application for further discovery. The second order was made by Marshall AJ on 9 December 2024 setting aside a subpoena to produce documents. After hearing argument, Marshall AJ allowed the adjournment. His Honour pronounced his order in the following terms:

"HIS HONOUR: All right, thank you. Thank you, counsel, for your submissions. My major concern at the moment is that if the trial goes ahead on the dates indicated prior to the hearing of the appeals those appeals will be more likely than not rendered nugatory. It's unfortunate - extremely unfortunate that we are in the current position given that the matter has previously been adjourned. I'm inclined to grant the adjournment and take into account in doing so the undertaking of the plaintiff to seek an expedited hearing on the appeal. So, the orders of the Court are as follows. One, the trial dates of 24, 25, 26 February 2025 are vacated. The matter is adjourned for hearing sine die on a date to be arranged by the parties with the civil listing manager."

1. His Honour, without interruption or calling for submissions, turned to the question of the costs of the adjournment and continued:

"HIS HONOUR: And I'm inclined, subject to any further submissions, to order that the plaintiff pay the defendant's cost thrown away by the adjournment. Now, I do so for the reason that when the matter came before me in relation to permitting the subpoena to issue and for documents to be produced pursuant to that subpoena. I effectively formed the view that I thought Daly AsJ was being backdoored, to put it colloquially, and mentioned that I would form the same view as him, but thought the expeditious way forward would be for an appeal against him to another judge of this court, not me, not at the Full Court level, could be arranged. And that is what I thought Mr McTaggart SC had agreed to do and I was stunned to find that there was also an appeal against me. And even more stunned to find a ground relating to inadequate reasoning. So, I say no more about that. So in those circumstances, unless the plaintiff wants to argue the point, I want to - I will order that the plaintiff pay the defendants' costs thrown away by the adjournment."

1. Prior to his Honour's remarks, neither counsel had raised the issue of costs or made an application in any terms. The response of counsel for the appellant is recorded as follows:

"MR WALLIS KC: Yes, your Honour. If your Honour, please.

MR WALLIS KC: No, your Honour. Nothing else, your Honour.

HIS HONOUR: All right. The Court will now adjourn."

1. The only inference reasonably available from that brief exchange is that counsel for the appellant did not, when the opportunity was offered, seek to persuade the Court to make a costs order different than the one suggested by his Honour. Counsel for the respondents said nothing. The Court's record of proceedings recorded the costs order in these terms:

"The plaintiff [appellant] is to pay the defendants' [respondents'] costs thrown away by the adjournment."

1. During the course of the following weeks there was correspondence between the respective solicitors about the amount of costs claimed by the respondents to have been thrown away by the adjournment. In the course of that correspondence, the solicitors for the appellant wrote a letter sent by email to the solicitors for the respondents on 27 February 2025 indicating disagreement with the amount of the costs claimed, but that "in any event, we note that the orders of Acting Justice Marshall do not require the costs to be paid forthwith. Accordingly, the costs should not be taxed until the conclusion of the proceedings." The solicitors for the respondents took a different view. Following receipt of that letter they, by email to the appellant's solicitors dated 14 March 2025, proposed an email to the judge's associate "in order to seek clarification on the costs order and avoid the need to go back to Court". The solicitors for the appellant responded by email on 17 March 2025:

"It would be inappropriate for you to write to the Court in the terms you suggested or at all.

The orders made are clear on their face. If your clients wished to seek orders which operated forthwith, they ought to have sought such orders in Court.

Your proposed correspondence seeks to reagitate a matter which has been dealt with.

If despite what we have said above, your clients wish to write to the Court, we ask that you include a copy of this email."

1. Despite the appellant's protestation, the solicitors for the respondents did write to the associate to Marshall AJ on 17 March 2025:

"We act for the Defendants in the above proceeding.

As you may recall, on 6 February 2025 the Honourable Acting Justice Marshall made an order that the Plaintiff pay the Defendants' costs thrown away by reason of the adjournment of the trial of the proceeding (as shown in the attached record of proceedings). The parties are in disagreement as to the proper operation of his Honour's order.

Our understanding was that his Honour intended that the order had immediate effect, and that the costs thrown away were to be payable forthwith. The Plaintiff's advisors believe that such costs are only recoverable at the conclusion of the proceeding.

We are conscious that it may be an inefficient use of Court resources and/or impossible to have the matter re-listed before his Honour to clarify. We write to therefore enquire whether his Honour would be prepared to clarify the operation of the costs order 'on the papers'/'in chambers' or if the Court can otherwise assist?

Please let us know if anything further would be of assistance to the Court (such as a solicitor's affidavit of the relevant correspondence).

We note that the solicitors for the Plaintiff are copied into this correspondence, that we sent a copy of this correspondence to them prior to sending it and that they requested that a copy of their response to us be included in this email (please see attached)."

1. No further hearing was conducted. No other submissions to the Court were made or invited on the issue of the meaning and effect of the order which had already been enunciated or whether some further order, in different terms, should be made. However, on 18 March 2025 the associate to Marshall AJ sent an email to the parties stating, "Please see attached a Memorandum of Order confirming that costs are to be paid forthwith" and attaching the memorandum in the terms set out at the beginning of these reasons. The notice of this appeal was filed on 25 March 2025. The solicitor for the respondents subsequently wrote to the solicitors for the appellants seeking to enforce an order in the terms expressed in the "Memorandum of Order". The order was then entered in accordance with r 813 after having been drawn up and sealed by the Court on 18 June 2025. The sealed order was expressed to have been obtained "upon the Memorandum of Order dated 18 March 2025."
2. The power to award costs is a discretionary power. In this jurisdiction it derives from the Supreme Court Civil Procedure Act 1932 (the SCCP Act), s 12, and the Supreme Court Rules 2000 (the SCR), r 57. A court has discretion to order that a party who applies for an adjournment pay the costs of the application, which may include the costs thrown away by reason of the adjournment. Where such an order is made, the court has a further discretion to order that the costs be paid either forthwith or "in any event". In both cases, a party will have the costs regardless of the outcome of the action. Where costs are payable forthwith, the costs are payable immediately. Where costs are to be paid "in any event", payment of the costs is delayed until the conclusion of the principal proceedings. Moreover, r 65(1) of the SCR provides that "unless the Court or a judge otherwise orders... the costs of an opposed application in a proceeding are part of the costs of the cause of the party in whose favour the application is determined." That provision was considered and explained by Porter J (as he then was) in two cases, Gunns Limited v Alishah (No 3) [2009] TASSC 103, 19 Tas R 401 at [25] and Woods v Deputy Commissioner of Taxation (No 2) [2012] TASSC 11, 21 Tas R 234. There is no need to repeat much of what his Honour said in those cases, but I would respectfully agree with and adopt his Honour's reasons. His Honour determined that r 65 creates a default provision unless the court, in the exercise of an unfettered discretion, "otherwise orders". His Honour undertook a detailed analysis of two of the ways in which a court may "otherwise order" and the circumstances which justify a departure from the default position. The first was the power to order that the party should have the costs "in any event". Another way in which the court may "otherwise order" is by providing that the costs be payable forthwith. His Honour considered, in both cases, that there is no threshold requirement of exceptional circumstances to permit departure from the default position, but the power is to be exercised when the interests of justice in a particular case require a departure from the rule. In Woods at [13] Porter AJ set out a number of the policy considerations behind a rule which delays payment of costs for interlocutory applications until the conclusion of the principal proceedings. I would add that the policy considerations are relevant to the exercise of the costs discretion regardless of the effect of the rule. One such consideration is that it is usually inappropriate to require a party to pay interlocutory costs immediately, since that party might ultimately succeed in the substantive proceedings, and set-offs can be made in light of the ultimate orders as to costs. At [15] his Honour set out a non-exhaustive list of the factors relevant to the exercise of the discretion to order that costs of interlocutory proceedings be taxed and payable forthwith:

• where the interlocutory proceedings are sufficiently self-contained and detached, or a discrete issue has been resolved;
• where the principal proceedings are not likely to be resolved for some time, thus denying the successful party access to the costs;
• where the interlocutory proceeding has had the effect of resolving a substantive part of the principal proceedings;
• where the financial position of the party in whose favour the order is made is such that their ability to continue in the litigation may be affected ( and the same effect on the party liable is not likely as a result of paying immediately);
• where there appears no real likelihood of multiple applications for costs to be taxed and payable forthwith as the interlocutory proceedings unfold;
• where there has been some unreasonable conduct by the party against whom the costs have been awarded."

1. Because this is an appeal from an order as to costs only, involving the exercise of a discretionary judgment, ss 44(1) and 45(1) of the Supreme Court Civil Procedure Act 1932 have application. Section 44(1) applies to costs appeals and provides:

"44(1) No appeal shall lie to a Full Court from any judgment or order given or made by a judge, whether sitting in court or in chambers, as to costs only, which are by any statute or any Order or Rule of Court left to the discretion of the judge, except -

(a) by leave of the judge giving such judgment or making such order;

(b) in cases in which the judge has declined or failed to exercise the discretion; or

(c) in cases in which the judge has proceeded on a wrong principle or otherwise contrary to law, or on irrelevant or insufficient materials, or has failed to consider any material fact."

1. In this case no leave was sought from Marshall AJ. It is not asserted that his Honour "declined or failed to exercise the discretion" although one ground of appeal alleges that his Honour failed to exercise the discretion judicially. However, the appellant claims that the primary judge proceeded "contrary to law" within the operation of s 44(1)(c).
2. Section 45(1) applies to appeals from discretionary judgments and provides:

"45(1) A Full Court, on the hearing of any appeal from any judgment, order, or other determination (whether final or otherwise) of a judge, shall not reverse or vary any adjudication of the judge which is, or purports to be, only the exercise of a discretion which the judge was entitled by law to exercise, unless it appears to the Full Court that -

(a) the judge has, in fact, declined or failed to exercise the discretion;

(b) the judge has proceeded on a wrong principle or otherwise contrary to law, or on irrelevant or insufficient materials, or has misapprehended the facts or has failed to consider any material fact;

(c) the adjudication is founded wholly or in part on an erroneous finding of fact or an erroneous determination in point of law; or

(d) by reason of further evidence received by the Full Court in exercise of the powers conferred by section 48, or some special circumstance, the adjudication should be reversed or varied."

1. The appellant's notice of appeal advances three grounds:

1. Having received email correspondence from the respondents' solicitors which the appellant had expressly objected to being sent to the Court, the learned Acting Justice Marshall erred in law by making the order appealed from without:

(a) any formal application seeking orders; > > (b) having any evidence to support the making of the order; or > > (c) providing the plaintiff/appellant any opportunity to be heard;

thereby denying the plaintiff/appellant natural justice and procedural fairness.

1. His Honour erred in law by failing to judicially exercise the discretion as to whether the defendants'/respondents' costs of the adjournment should be paid forthwith.

3 His Honour erred in law by failing to give any reasons for making the order.

1. Ground 1(c) of the appeal is made out. Ground 1(a) and ground 2 are very closely related. Ground 2 is subsumed by ground 1(c) because the assertion that his Honour failed to exercise the discretion judicially is based on the failure to provide the appellant an opportunity to be heard. In my view, the discretion did not miscarry as a result of making an order without evidence as asserted in ground 1(b). Costs orders are frequently made on the basis of material advanced in submissions without formal evidence.
2. It is a fundamental principle of the system of justice that courts are obliged to accord procedural fairness to parties to a proceeding: HT v The Queen [2019] HCA 40, 269 CLR 403 per Kiefel CJ, Bell and Keane JJ at [17]. As their Honours continued at [18], the concern of the law is the avoidance of practical injustice. Although the content of procedural fairness may vary according to the circumstances of particular cases, the obligation of a court is to give a person against whom a claim is made a reasonable opportunity to he heard, to appear and present his or her case. In International Finance Trust Company Ltd v New South Wales Crimes Commission (2009) 240 CLR 319, French CJ said at [54]:

"Procedural fairness or natural justice lies at the heart of the judicial function. In the federal constitutional context, it is an incident of the judicial power exercised pursuant to Ch III of the Constitution. It requires that a court be and appear to be impartial, and provide each party to the proceedings before it with an opportunity to be heard, to advance its own case and to answer, by evidence and argument, the case put against it..."

1. The order made by Marshall AJ as enunciated on 6 February 2025 was silent as to when the costs which were the subject of the order were to be paid. The time for payment of those costs was not a matter adverted to by his Honour on that day. It was not the subject of any application made by counsel for the respondent or a submission by either party. At the very least, the meaning and effect of the order enunciated on 6 February 2025, as it concerned the time for payment of the costs thrown away, was uncertain.
2. The appellant submits, correctly in my respectful view, that the email sent by the solicitors for the respondents to the primary judge's associate on 17 March 2025 enlivened the exercise of discretion by the primary judge in two respects. The first question was whether the respondent ought to be permitted to re-open the question of costs. The second question was, if the terms of the costs order enunciated on 6 February 2025 were to be reconsidered, how the costs discretion should then be exercised.
3. As to the first discretion, the order made by Marshall AJ on 6 February 2025 was not perfected. Until a formal order has been entered and filed, a judge has the power to recall or vary that order: Plimsoll v Drake (No 3) [1996] TASSC 50. In Plimsoll, after citing In re Harrison's Share Under a Settlement (1955) Ch 260 at 276 and Carroll v Price [1960] VicRp 101; (1960) VR 651, Zeeman J concluded that an order pronounced by a judge can be withdrawn, altered or modified by that judge until it is drawn up, passed and entered. I would now also refer to Autodesk Inc v Dyason (No 2) [1993] HCA 6; 176 CLR 300 per Mason CJ at 302, Brennan J at 308, Gaudron J at 322; DJL v Central Authority [2000] HCA 17, 201 CLR 226 at [32]- [33] and Burrell v The Queen [2008] HCA 34, 238 CLR 218 at [17]- [22], all cited in this Court in GFR v SRP (No 2) [2024] TASFC 6. However, the power is to be exercised sparingly and only in appropriate cases: Oxenbould v The Solicitors' Trust (No 2) [2011] TASSC 63 per Blow J (as he then was) at [17]. Blow J's decision was challenged on appeal but not on this point. In Plimsoll, Zeeman J pointed out that the question of whether to permit a party to re-open a question of costs which had previously been determined involved the exercise of discretion, and it was incumbent on an applicant to establish sufficient reasons to justify a favourable exercise of the discretion. His Honour continued at [6]:

"It would be inconsistent with the proper administration of justice if a party could request the Court or a judge to reconsider an order previously made, merely because that party makes that request and wishes to address some argument in support of the proposition that an order in an amended form would be a proper disposition of the original application. The public interest requires that there be some finality to litigation. Prima facie that means that an applicant should place before the judge all the relevant evidence and address all the relevant arguments in the first instance."

1. As Mason CJ stated in Autodesk v Dyason at 303, "the jurisdiction is not to be exercised for the purpose of re-agitating arguments already considered by the Court; nor is it to be exercised simply because the party seeking a rehearing has failed to present the argument in all its aspects or as well as it might have been put."
2. As to the exercise of the second discretion, to be exercised only if the application to re-open was permitted, the question of whether the costs thrown away by reason of the adjournment were payable forthwith required, in the circumstances of this case, consideration and application of the issues of policy and principle discussed in Gunns Limited v Alishah (No 3) and Woods v Deputy Commissioner of Taxation. That seems to me to be particularly so when the appellant's application for an adjournment was successful, had arisen because of the failure or refusal of the respondents to produce documents and that the result of the appeals from the decisions allowing that refusal was then unknown.
3. Procedural fairness demanded that an opportunity be allowed for the appellant to be heard on both discretionary issues. A decision on those questions could be reached only after having given the parties an opportunity to be heard. The appellant was permitted no opportunity to be heard on either question. The submission of counsel for the respondent that the letter written by the appellant's solicitors on 17 March 2025 amounted to an opportunity to be heard should be rejected. To the contrary, that letter objected to the issue being "reagitated" and demonstrated the inability of the appellant to make relevant submissions. With great respect to the primary judge, it was procedurally unfair for his Honour, on the following day, without further hearing or submission and despite the letter from the appellant's solicitors, to make an amended order in Chambers expressly providing for payment of costs "forthwith". No notice of an intention to make an amended order was given. Although the approach made by the solicitors for the respondents to the primary judge was expressed in terms of a wish to "clarify" his Honour's intention, the amended order materially altered the substance of the order which had previously been enunciated. By failing to allow an opportunity for the appellant to be heard on these issues, his Honour proceeded in a manner which was contrary to law within the operation of the SCCP Act, s 44(1)(c) and s 45(1)(b).
4. It cannot be determined whether his Honour proceeded on a wrong principle of law, or on irrelevant or insufficient materials, or failed to consider any material fact on the issue which is the subject of this appeal because no reasons for the order contained in the later memorandum of order were given. That leads to consideration of the third ground of appeal. As has been explained in a great many cases, for example by the Court of Appeal in Victoria in Lam v Lam [2017] VSCA 173, reasons are a necessary incident of the judicial process and are important not simply as a means of enabling appeals to be properly conducted and determined, but also so as to enable parties to perceive that justice has been done. I do not intend to suggest that reasons for costs rulings need to be lengthy or detailed. In some cases only very brief reasons are required. However, in this case, where exercise of the discretion to reconsider an order already enunciated and order payment of costs forthwith required consideration of the principles stated earlier in these reasons, a failure to expose any path of reasoning was an error of law: Hunter v Transport Accident Commission [2005] VSCA 1; 43 MVR 130.
5. For those reasons I would allow the appeal and set aside the order made 18 March 2025.
6. The issue then arises of what, if any, consequential order should be made. As has already been made clear, the appellant does not challenge the order enunciated by Marshall AJ on 6 February 2025 that it pay the respondents' costs thrown away by the adjournment. In my respectful view this Court should remedy any uncertainty about the terms of that order as it concerns the timing of the obligation to pay the costs. This Court has, on the hearing of the appeal, power to make any order or determination which ought to have been made by the primary judge: SCCP Act, s 47(1). The Court should reconsider the question of when the costs of the adjournment should be paid and re-exercise the discretion. One reason is that the appointment of Marshall AJ as an acting judge has expired and his Honour is no longer available to determine the matter were it to be remitted to him. Another reason is to avoid any further cost and delay. The appropriate order is that the costs thrown away by the adjournment should be paid by the appellant in any event. It was not suggested that the respondents would be shut out from the litigation if they did not receive the costs forthwith. I think it would be quite difficult for a taxing officer to determine what costs of the adjournment were, in fact, wasted by the adjournment until the action is heard and concluded. Some of the work done to prepare for trial may not need to be done again, with the result that the cost was not "thrown away". In that context, the costs are not inherently self-contained and there remains a real risk that costs claimed for preparation for trial are duplicated. This is a case in which it would be inappropriate to require the appellant to pay interlocutory costs immediately. If the appellant ultimately succeeds in the action, set-offs can be made in light of the ultimate orders as to costs. It was not unreasonable for the appellant to seek to pursue the appeals against the interlocutory orders made by Daly AsJ and Marshall AJ and to apply for an adjournment of the trial to enable it to do so. The application for an adjournment was allowed. Although it is not determinative of the issue, this Court is now aware (although the primary judge was not) that the interlocutory appeals were successful on the basis that this Court considered that the disputed documents were relevant and not subject to legal professional privilege.

WEEDING PARTY HIRE PTY LTD v SALTERS (TAS) PTY LTD

1. I have read the reasons for judgment of Pearce J and agree that the appeal should be upheld for the reasons he has given. I also agree with the orders he proposes.