Wilson Parking Australia 1992 Pty Ltd v Rush

REASONS FOR JUDGMENT 1 These reasons, and the orders to which they relate, arise out of my determination of Wilson's Notice of Motion dated 9 October 2008 by an interlocutory judgment given on 27 October 2008: see Wilson Parking Australia 1992 Pty Ltd v Rush [2008] FCA 1601. These reasons should be read together with the reasons published on 27 October 2008. 2 The first of two issues which requires to be dealt with relates to Wilson's undertaking as to damages. When the matter was listed for argument on costs, counsel for Wilson queried whether it was necessary for his client to have given the undertaking in return for the respondents' undertakings numbered 3, 7 and 11. I took the view that the latter undertakings involved interlocutory restraints the operation of which may give rise to compensable losses, and that Wilson's undertaking as to damages should, therefore, apply. However, counsel for S & K indicated that his client did not require an undertaking as to damages in return for the giving by it of undertaking No. 11. In the circumstances, I propose to relieve Wilson of the undertaking as to damages which it gave at the interlocutory hearing, and to accept in place thereof an undertaking in the same terms, but without reference to S & K's undertaking No. 11. 3 The other issue concerns costs, and is complicated to a degree by the diversity of the relief sought in Wilson's Notice of Motion, and by the attitude which the respondents took to that relief, once the Notice of Motion had been served upon them in draft. Although it will often be convenient to reserve the costs of an interlocutory application, S & K sought the whole of its costs on this occasion, for reasons to which I shall presently turn. Mr Rush sought his costs, to the extent that they related to those claims in the Notice of Motion which were resolved by the giving of undertakings. Wilson also sought its costs, at least to the extent that it succeeded on its Notice of Motion. 4 Dealing first with the costs claims of S & K, it was submitted on its behalf that Wilson had sent no letter of demand before serving its Notice of Motion, and that subsequent correspondence between the parties disclosed that the substance of pars 1, 2, 4, 10 and 11 of the Notice of Motion would, with a reasonable approach by all concerned, have been resolved by agreement, and that the Notice of Motion was, to that extent, unnecessary. I was taken to the correspondence to which counsel for S & K referred. The only prior warning given by Wilson as to its proposed Notice of Motion was in a letter sent to my Associate on 2 October 2008 (with copies to the other parties), in which the following paragraphs appear: Our client will be seeking various orders regarding the documents that are not disputed by the First, Second or Third Respondents as being "Listed Things" pursuant to the execution of the Search Order dated 13 August 2008. Broadly, the orders will relate to the return, destruction and use of the undisputed documents and the information contained therein. The Applicant contends that many items already agreed by the Parties to be Listed Things contain highly sensitive confidential information of the Applicant. We will also be seeking orders providing limitations on the work activities of the First and Second Respondent, in relation to Wilson carpark customers and owners. We are presently obtaining instructions and intend to file our Notice of Motion and supporting affidavit material by close of business Tuesday, 7 October 2008. Although there followed a deal of correspondence between the parties about dates, Wilson did not provide any further detail of the relief which it sought until it served its Notice of Motion on 9 October 2008. 5 Correspondence between Wilson and S & K subsequent to the service of the Notice of Motion discloses that S & K readily proffered an undertaking which substantially addressed the matters to which pars 1, 2 and 4 of the Notice of Motion were directed. It is true that the detail of its undertaking, including the precise specification of the documents to which it related, took some days to finalise, but the differences between the parties were not, in my view, such as give rise to the necessity for Wilson to come to court to obtain the relief which it ultimately accepted by way of S & K's undertaking. 6 On the other hand, it was only quite late in the piece (on 15 October 2008) that S & K indicated a willingness to accede, conditionally, to an order in terms of par 10 of the Notice of Motion as served. That indication led to further exchanges between Wilson and S & K, the result of which was that Wilson ultimately pressed for a modified version of that paragraph, to which S & K did not object. I would not, therefore, hold that it was unnecessary for Wilson to have taken out its Notice of Motion in order to achieve relief broadly of the kind sought in par 10. 7 The correspondence between Wilson and S & K did not deal with the relief sought in par 11 of the Notice of Motion. Ultimately, Wilson secured an order which reflected the intent of that paragraph, albeit tied to S & K's undertaking. I would not hold that it was unnecessary for Wilson to have taken out its Notice of Motion in order to achieve relief of this kind. 8 Wilson was unsuccessful under par 3 of its Notice of Motion. It will be apparent from my reasons given on 27 October 2008 that I took the view that par 3 constituted, in effect, an attempt by Wilson to revisit the area which had been resolved on 2 September 2008. I am bound to say that, with a proper understanding of what occurred on that occasion, the relief sought in par 3 of the Notice of Motion ought not to have been claimed. The resolution of the documentary aspect of par 7 of the Notice of Motion, and of par 8 thereof, was substantially influenced by my disposition of par 3. In each case Wilson was unsuccessful. 9 On the other hand, it was only during the hearing of the Notice of Motion that S & K proposed a mechanism to address so much of par 7 of the Notice of Motion as was concerned with electronic storage devices. S & K then acknowledged that it had not complied with relevant aspects of its obligations under the search order. It was, in the circumstances, necessary for Wilson to have sought the relief which it did in par 7, and it obtained a form of relief which broadly corresponded with what it sought. 10 In summary, I am persuaded by S & K that it was unnecessary for Wilson to have taken out its Notice of Motion to obtain the relief sought in pars 1, 2 and 4 thereof. Further, S & K succeeded in its defence to pars 3 and 8 of the Notice of Motion, and to the documentary aspects of par 7 thereof. With respect to these elements, I consider that S & K has made good its application for costs. As will be apparent from what I have written above, that conclusion is independent of the ultimate outcome of the proceeding. S & K's costs, therefore, should not be in the cause, but should be paid by Wilson. However, I make it clear that those costs are the costs of defending the Notice of Motion only, and do not extend to the costs of correspondence and such other communications as may have been necessary to work out the terms of the undertakings which S & K would give. Indeed, it was S & K's case on the present application, which I have accepted, that, absent the Notice of Motion, some such orderly process of negotiation as is disclosed by that correspondence ought to have occurred in any event. 11 With respect to pars 10 and 11 of the Notice of Motion, the claims therein were reasonable ones for Wilson to have made, and it ultimately achieved a measure of success, albeit in terms which did not wholly reflect those claims. I think it unlikely that the costs either of Wilson or of S & K would have been to any significant extent inflated either by the making or by the pressing of these claims, but, if they were looked at in isolation, I would consider that the costs of each of these parties should, in relevant respects, be that party's costs in the cause. 12 Although the relief sought in par 9 of the Notice of Motion would not have been binding on S & K, S & K stood to be substantially affected by the grant of that relief, and strenuously resisted it. In so far as the matter of costs is concerned, S & K effectively made itself a respondent to par 9 of the Notice of Motion. In this respect, Wilson sought and obtained interlocutory injunctions which will protect its position pending the hearing and determination of the proceeding. Subject to the matters to which I refer below, the costs of an application for such an injunction should follow the ultimate event. That is to say, the costs of each of Wilson and S & K should be that party's costs in the cause. 13 It was pointed out on behalf of S & K that par 9 of the Notice of Motion, as served, sought a broad restraint on Messrs Rush and Sherriff working in the car parking industry in Melbourne. It was submitted that such a restraint would, realistically, never have been granted. I was reminded that, on the first day of the hearing of the Notice of Motion, Wilson's application for such a restraint was abandoned. Further, S & K submitted that the relief originally sought in par 9(b) of the Notice of Motion was so substantially modified in the form in which relevant orders were eventually made to as to justify the conclusion that it should be S & K, rather than Wilson, that should have its costs of par 9. 14 I am not disposed to qualify the order which I would otherwise make as to the relief sought under par 9 of the Notice of Motion by reason of the abandonment of subpar (a) thereof. The relief sought in subpar (b) was, from the outset, expressed in the alternative to that sought in subpar (a), and there was no suggestion by S & K that any such relief should be granted. The abandonment of subpar (a) was, in my view, a sensible and pragmatic step on the part of Wilson, and it was taken very early in the hearing of the Notice of Motion. Wilson is, in the circumstances, in the position of a party which has made alternative claims, and has succeeded on one of them, without any unreasonable persistence with the claim with respect to which it did not succeed. I am not, therefore, disposed to qualify the terms of the costs order which I would otherwise make by reference to Wilson's abandonment of subpar (a), or to my own assessment of the prospects which that claim might have had, had it been pressed. 15 Neither would I make any such qualification by reason of the modifications which the claim originally embodied in par 9(b) of the Notice of Motion underwent during the course of the hearing of Wilson's motion, or by reason of the actual terms of the orders ultimately made. There was never a suggestion that S & K would consent to Mr Rush or Mr Sherriff being restrained in anything like the terms originally proposed, including those terms as modified, or in the terms of the orders ultimately made. This was an instance in which Wilson made a claim for a general restraint and, in an environment in which it encountered stiff opposition to that claim, modified it to meet that opposition in some respects, and to make it more likely that a claim - in some respects a more conservative claim - would be accepted by the court. 16 I could order that S & K should have the costs of its defence to pars 1, 2, 3, 4 and 8, and to the documentary aspects of par 7, of the Notice of Motion, that Wilson should have the costs of its pursuit of the non-documentary aspects of the relief sought under par 7, and that the costs of S & K and Wilson, in relation to the other paragraphs of the Notice of Motion, be in the cause. This would, however, be likely to require the making of fine distinctions on taxation, to the general cost and inconvenience of all concerned. I consider that I am in a position to make a generally reliable, albeit perhaps robust, estimation of the extent to which the parties' professional exertions related to each of the three categories to which I have referred. I would estimate that something in the order of 50% of the professional input into the preparation for and hearing for Wilson's motion related to issues as to which I have held that S & K is unconditionally entitled to its costs. Against this I would offset Wilson's unconditional entitlement to the costs of the non-documentary aspects of par 7. That is a minor component, and I think that justice would be done in relation to it if I were to reduce S & K's entitlement to 45% and to make no order in favour of Wilson. One half of the costs of each of S & K and Wilson will be that party's costs in the cause. Otherwise, there will be no order for costs as between Wilson and S & K. 17 Turning to the costs dispute to the extent that it relates to Wilson's claims against Messrs Rush and Sherriff, I propose to take the same broad approach as that taken above in the case of S & K. However, the extent to which these parties (ie Messrs Rush and Sherriff and, as against them, Wilson) focused their professional exertions upon the different elements of the claims sought in the Notice of Motion balances up rather differently. Although the relief sought under pars 3, 5 and 6 of the Notice of Motion as served was sought against Messrs Rush and Sherriff, once it became clear that they proposed to rely upon the privilege against self-incrimination, or self-exposure to a penalty, Wilson did not press for that relief. In the result, very little time was occupied with respect to these claims against Messrs Rush and Sherriff. It was submitted of behalf of Messrs Rush and Sherriff that Wilson ought to have known, from the outset, that they would have claimed the privilege, and that it was, in effect, an unnecessary exercise to have sought this relief in the Notice of Motion. I would not draw that conclusion. Although the positions adopted by Messrs Rush and Sherriff previously may reasonably have foreshadowed an intention by them to claim the privilege before they actually did so, I would not characterise relevant aspects of the Notice of Motion as having been unnecessary. 18 The correspondence which has been put before the court shows that Messrs Rush and Sherriff, like S & K, were ready to offer undertakings which substantially addressed the relief sought in pars 1, 2 and 4 of the Notice of Motion, once it had been served. Although the extent to which those parties promptly offered something that would satisfy the legitimate needs of Wilson varied somewhat from that which appears in the case of S & K, I could not make any useful distinction in point of substance. I recognise that Mr Sherriff did not make a claim for costs at all, but Mr Rush did, and my granting, in part, of Mr Rush's claim would make it both incongruous and unjust were Mr Sherriff not to be treated similarly. In relation to pars 1, 2 and 4 of the Notice of Motion, therefore, Messrs Rush and Wilson should have their costs. As in the case of S & K (see par 10 above), I make it clear here also that I am concerned only with the costs incurred by Messrs Rush and Sherriff in defending the Notice of Motion as such. My conclusion does not extend to the communications by which the parties worked out the terms of the undertakings which were ultimately accepted as sufficient to meet the needs of pars 1, 2 and 4 of the Notice of Motion. 19 In other respects, the costs of the Notice of Motion, as between each of Mr Rush and Mr Sherriff and Wilson, should be the party's costs in the cause. For reasons expressed above in relation to S & K, that conclusion applies in relation to the interlocutory restraints sought by par 9 of the Notice of Motion. It is likewise with respect to pars 10 and 11. Although Mr Rush opposed an order along the lines of par 10, Wilson's success in that regard was based upon a provisional presumption that it would ultimately prevail in the proceeding as a whole. So its costs, and those of Mr Rush, should follow the ultimate result. It was not entirely clear whether Mr Sherriff opposed par 10 of the Notice of Motion. In my reasons of 27 October 2008, I said that he did (see [57] thereof). That was based on the way his case was presented on 21 October 2008 which, while not dealing with par 10 in terms, implied a general association with the submissions made on behalf of Mr Rush. In the outline of submissions filed on behalf of Mr Sherriff on 20 October 2008, what I would call a qualified non-opposition to par 10 was expressed. However these distinctions may be, par 10 contained a claim which Wilson was required to come to court to press, and it was largely successful in that endeavour. Much the same can be said of par 11, although, as the position of S & K turned out, that claim was of little relevance to Messrs Rush and Sherriff. 20 In the case of Messrs Rush and Sherriff, therefore, the discrimination which I need to make is between pars 1, 2 and 4 of the Notice of Motion, where I accept that those parties, like S & K, should have their costs unconditionally, and pars 9, 10 and 11 of the Notice of Motion, where, consistently with what I have decided in relation to S & K, the costs of each party should be its, or his, costs in the cause. Understandably in the circumstances, the focus of the cases which related to Messrs Rush and Sherriff - both for and against - was centred much more on par 9 of the Notice of Motion than in the case of S & K. That was not only because Messrs Rush and Wilson would be directly and immediately affected by the grant of relief as sought in that paragraph, but also because they were effectively able to deflect Wilson's case under pars 3, 5 and 6 of the Notice of Motion by the claims to privilege which they made. Neither were they affected by the claims made in pars 7 and 8 of the Notice of Motion. 21 I take the view that justice would be done if Wilson were ordered to pay 20% of the costs of Messrs Rush and Sherriff of the Notice of Motion, and that 80% of the costs of those parties and of Wilson, of the Notice of Motion, should be their, or its, costs in the cause. I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jessup.