Xabregas v The Owners - Strata Plan 79205

Background 4To deal with the motion it is necessary to set out some of the relevant history to what has been a long running piece of litigation in the Consumer, Trader and Tenancy Tribunal (CTTT), the Supreme Court of New South Wales, and more recently in this Court. 5The Applicant and her ex-husband are the owners of a lot in a strata title property on Kobada Road, Dover Heights. The property is a two lot strata complex. In or about 2011 a dispute arose between the Applicant and the owner of the other lot in the strata development, a Ms Moallem, in connection with an attic space. That dispute initially became the subject of proceedings in the CTTT and then in the Supreme Court. The parties in those Supreme Court proceedings (no. 2011/00244426) were the Applicant as Plaintiff and the Respondent as First Defendant. There were also other parties to those proceedings who are not relevant for present purposes. These proceedings were settled by consent on 19 October 2011 at which time the following orders were made: By consent and without the admission of liability as between the Plaintiff and the First Defendant 1. Order that the Summons filed 28 July 2011 and Amended Summons filed 8 August 2011 be dismissed as against the first defendant. 2. The plaintiff to pay the first defendant's costs of the proceedings as agreed or assessed. 3. The proceedings as against the second, third and fourth defendants be stood over to 15 February 2012 for further mention. Noted: 1. As between the plaintiff and the first defendant the within proceedings have been settled on the basis of a formal agreement entered into between them on 14 October 2011 which document constitutes the terms of settlement between them. These are contained in the document described as Deed of Agreement which is annexed hereto and marked "A". 2. The terms of settlement contained in the attached Deed of Agreement are not to be disclosed. 3. That proceedings against the second, third and fourth defendants are to be dismissed on completion of various covenants under the attached Deed of Agreement. 4. The stay orders made by this Court are required to be maintained pending the parties completing their obligations under covenants referred to in note 3 above. 6The Deed dated 14 October 2011 and referred to in Notation 1 purported to deal with and resolve or Dr Xabregas' dispute with the Owners of Strata Plan 79205. Relevantly for what has subsequently transpired, the Deed contained in Clause 15 in the following terms (noting BX to be the Applicant and LM to be her former husband): 15. Upon the signing of this Deed of Agreement BX agrees to take all necessary steps to dismiss the Supreme Court Proceedings as against the Owners Corporate on the following terms: (i) The Supreme Court Proceedings are dismissed; (ii) BX is to pay the costs of the Owners Corporation of the Supreme Court Proceedings on a solicitor/client basis as agreed or assessed. In default of payment of the costs referred to in (ii) of this clause BX and LM hereby irrevocably agree and consent to such costs being constituted and registered as a charge on Lot 2. (my emphasis) 7Thereafter, the parties continued to be in dispute and towards the end of 2012 further proceedings were taken in the Supreme Court in respect of case number 2011/00244426. As a result of those skirmishes, a number of further orders were made including further orders for costs against Dr Xabregas. These orders, made by Justice Bergin, Chief Judge in Equity on 22 November 2012 and 5 December 2012, were in the following terms: a) 22 November 2012 Order: 1. Make the order in paragraph 2 of the Amended Notice of Motion filed in Court today. 2. This matter is listed at 10am on 5 December 2012. Orders Sought: 2. The Plaintiff to pay the costs of the First Defendant and the Respondent to the motion on an indemnity basis. b) 5 December 2012 1. That the plaintiff is to pay the costs of the first defendant and the respondent in respect of the application for indemnity costs as contained in the Amended Notice of Motion. 2. It is noted that the Plaintiff neither consents nor opposes the following order: I make the order in Paragraph 1 of the Short Minutes of Order initialled by me and dated today. 3. It is noted that the plaintiff and the first defendant neither oppose nor consent to the following order: I make the order in paragraph 2 of the Short Minutes of Order initialled by me and dated today. 4. It is noted that the plaintiff and the first defendant neither oppose nor consent to the following order: I make the order in paragraph 3 of the Short Minutes of Order initialled by me and dated today. 5. It is noted that the plaintiff does not oppose the following order: The plaintiff is to pay the respondent's costs in respect of the balance of the relief claimed in the Amended Notice of Motion. 6. None of the defendant's costs in respect of the Amended Notice of Motion are to be levied by the first defendant against the respondent. 7. Grant liberty to restore on three days notice. The Court Orders that: 1. None of the First Defendant's costs of these proceedings and none of the costs referred to in clauses 10, 12(iii), 14, 15(ii) and 20 of the Deed of Agreement which is Annexure A to the Consent Orders of 19 October 2011, are to be levied by the First Defendant against the Respondent to the Plaintiff's motion filed 20 August 2012 but are only to be levied (insofar as it may be necessary) against Lot 2. 2. The Owners Corporation is to register a caveat on the title of Lot 2 SP 79205 to secure the costs and expenses referred to in Order 1. 3. The resolution of the Owners Corporation referred to in paragraph 6 of the minutes of the Annual General Meeting held on 8 October 2012 be set aside. 8The parties agree that the effect of the order commencing "None of the First Defendants costs of these proceedings" etc was that none of the Strata Plan's costs could be levied against the owner of Lot 1 (Ms Moallem) and that, so far as necessary, could only be levied against Dr Xabregas being the owner of Lot 2. The intent of the order when considered overall would seem to be that Dr Xabregas was to be liable for the costs of the proceedings and that if those costs were unpaid and it were necessary for them to be levied against property then they could only be so levied against the property in which Dr Xabregas had an interest. 9I was informed by Mr Holt, and this was not disputed by Dr Xabregas, that in February 2013, and so as to enable the solicitor/client costs of the litigation to be paid, the Strata Plan struck a special levy. Dr Xabregas objected to that levy in the CTTT. She was successful in that Tribunal as the levy struck was apparently not in compliance with the relevant legislation. As a consequence the Strata Plan then filed a Notice of Motion under the slip rule in the Supreme Court proceedings number 2011/00244426 seeking to amend the order made on 5 December 2012 to enable the special levy sought to be struck. That motion came before Windeyer AJ on or about 22 October 2013 and was dismissed. In addition an Order for Costs was made against the Strata Plan and in favour of the Owner of Lot 1 (Ms Moallem). The effect of that order being that if such a costs order is to be levied, then given the two lot nature of the Strata Plan, it can only be levied against Lot 2. Dr Xabregas is unhappy about this outcome and notes that while she was not the losing party in the slip rule motion brought by the Strata Plan, the costs payable by the Plan have, by virtue of its nature, effectively become costs payable by her. 10At or about the same time as the slip rule motion was proceeding, Costs Assessment Certificates issued from the Supreme Court in respect of the Costs Orders made on the 19 October 2011, 22 November 2012 and 5 December 2012 (and which have earlier been set out herein). Two certificates were issued by the Costs Assessor Mr Broad on 17 September 2013, and they were released by the Manager, Costs Assessment on 24 October 2013 following the payment by the Owners of Strata Plan 79205 of the costs of the Costs Assessment in accordance with the usual practice of the costs assessment scheme. The Certificate of Determination of Costs assessed the fair and reasonable costs due to be paid by Dr Xabregas to the Strata Plan as being in the sum of $71,090.12. The Certificate of Determination of Costs of Costs Assessment indicated that the further sum of $3,087.05 was payable by Dr Xabregas. No application for review of these assessed amounts has been made by Dr Xabregas and I was informed by her during the hearing that no challenge to the costs certificates is to be made. The costs assessment file number was 2013/0165919. 11While all of these various litigious events were occurring, and on a date of which I was not informed (but certainly during 2013), the owner of Lot 1, Ms Moallem, commenced further proceedings against Strata Plan 79205, being case number 2013/327776. Those proceedings concerned other issues, the detail of which I was not advised, and I am informed that they were heard and determined by White J. Ms Moallem was successful and a further order for costs was made against the Strata Plan on 4 November 2013. Dr Xabregas argues that along with the costs order made Windeyer AJ, this order had the effect, given the two lot nature of the Strata Plan, of sheeting home those costs to her, notwithstanding that she was not the losing party. It is not even clear to me from the material filed and the submissions made if Dr Xabregas was an active participant in the proceedings commenced by Ms Moallem. 12On the 13 November 2013 and given her expressed unhappiness at the effect of the costs orders which had been made by Windeyer AJ and White J, Dr Xabregas filed a Notice of Motion in the Supreme Court in proceedings 2013/327776. That motion was heard by White J on 22 November 2013. She sought various orders including to set aside/vary the costs orders made in October and November 2013, with a view to making other persons or entities responsible for them, being the strata managers and their solicitors. She also sought an order in paragraph 6 of her motion in the following terms:- Pursuant to Regulation 36.16(1), 36.16(3A) and 36.16(4) of the Uniform Civil Procedure Rules 2005 that Justice White's orders as to what are costs 'insofar as is necessary' be set aside, and an order be made that: "pursuant to clause 15 of the Deed of Agreement the costs payable by Benvinda Aura Nunes Xabregas and Luiz Manuel Pires Marcos are 'insofar as is necessary' costs of the Supreme Court proceedings determined by the Costs Assessment of 24 October 2013 to be the fair and reasonable amounts of $71,090.10 for the Costs Applicant and $3,087.05 for the costs of the costs assessment, and these costs are to be levied against Lot 2". 13Although somewhat confusingly drafted, this order on its face concerns the costs certificates issued pursuant to the orders made on 19 October 2011, 22 November 2011 and 5 December 2011. It seems to be the case, and this was certainly Dr Xabregas' submission, that she is seeking an order from White J to the effect that the costs assessed by Mr Broad be levied against her Lot, in accordance with the Deed that resolved the initial dispute between the parties, the relevant terms of which are set out in paragraph 6 hereof. She says that this should occur rather than her being pursued directly by the Respondent, who she says wishes to bankrupt her. The determination of this question, along with the other issues raised before White J, are the subject of a reserved decision. No date for the delivery of his Honour's decision has yet been advised. 14Following White J reserving his decision, the Strata Plan registered in this Court on 29 January 2014 the two Costs Assessment Certificates dated 17 September 2013. The Certificates were registered together and became a judgment of this Court upon filing. The Certificates were for a total amount of $74,177.17, to which was added a registration/filing fee of $84.00, making a total judgment of $74,261.17. It is with that judgment entered on 29 January 2014 that this Notice of Motion is concerned. Dr Xabregas seeks amongst other things that it be set aside or that there be a stay of enforcement in respect of it.

Should the judgment be set aside? 15Despite the terms of Order 1 sought in her Amended Notice of Motion which seeks that the judgment be set aside pursuant to UCPR 36.16(2)(b), the matter proceeded before me upon the basis that Dr Xabregas was relying upon UCPR 36.15(1) to warrant the judgment being set aside. UCPR 36.15(1) provides: A judgment or order of the court in any proceedings may, on sufficient cause being shown be set aside by the order of the court if the judgment was given or entered, or the order was made, irregularly, illegally, or against good faith. 16Dr Xabregas contends in essence that the costs assessment judgment was entered both irregularly and against good faith, and that in those circumstances it should be set aside. Mr Holt does not accept that either of those assertions are made out and says that the judgment should not be set aside. He does however concede that the registration fee of $84.00 was not properly included as part of the registered judgment. A further argument was advanced in Dr Xabregas' oral submissions to the effect that the costs orders giving rise to the issue of the Certificates and the registering of the judgment were interlocutory orders and that accordingly they are not yet due and payable. The proposition is advanced that because the orders underpinning the judgment are not yet payable, the judgment should be set aside. It is of course noted that there is a threshold question for the court to determine before any judgment is set aside, that being whether there is sufficient cause for the court to exercise its discretion to do so. This threshold issue has relevance in considering each of the grounds relied upon by Dr Xabregas.

Was the judgment entered against good faith? 17Ritchie's Uniform Civil Procedure NSW observes at par [36.15.17] that the phrase "against good faith" is not susceptible to exhaustive definition and "relates to the circumstances in which the judgment was given". The phrase was recently considered by Adams J in Chand v Zurich Australian Insurance Limited [2013] NSWSC 102. In that case, His Honour said: 9. The meaning of the phrase "against good faith" in Pt 31, r 12A of the District Court Rules 1973 (in the same terms as UCPR r 36.15 (1)) was considered in Kendell v Carnegie & Ors [2006] NSWCA 302; (2006) 68 NSWLR 193. The trial judge, who set aside the judgment, relied on the following passage from Taylor v Johnson (1983) 151 CLR 422 at 432 (Mason ACJ, Murphy & Deane JJ) - The particular proposition of law which we see as appropriate and adequate for disposing of the present appeal may be narrowly stated. It is that a party who has entered into a written contract under a serious mistake about its contents in relation to a fundamental term will be entitled in equity to an order rescinding the contract if the other party is aware that circumstances exist which indicate that the first party is entering the contract under some serious mistake or misapprehension about either the content or subject matter of that term and deliberately sets out to ensure that the first party does not become aware of the existence of his mistake or misapprehension. 10. Bryson JA (with whom Hodgson and McColl JJA agreed) considered that the following passage from Taylor v Johnson (at 432 - 433) should also be noticed - [29] Moreover, and perhaps more importantly, it is a principle which is best calculated to do justice between the parties to a contract in the situation which it contemplates. In such a situation it is unfair that the mistaken party should be held to the written contract by the other party whose lack of precise knowledge of the first party's actual mistake proceeds from willful ignorance because, knowing or having reason to know that there is some mistake or misapprehension, he engages deliberately in a course of conduct which is designed to inhibit discovery of it. Our comment can, for present purposes, be limited in its application to the case where the second party has not materially altered his position and the rights of strangers have not intervened. Bryson JA went on to say - [42] No basis has been suggested and in my opinion there is no basis for bringing under consideration whether the consent judgment was given irregularly or illegally. The relevant matter to decide was whether Mr Kendell showed that the judgment was given against good faith. This is not a closely defined test, and is not to be equated with a test whether the Terms of Settlement were void at common law for mistake, or were open to be rescinded in equity for a mistake of the kind described in Taylor v Johnson [(1983) 151 CLR 422], or for a mistake of some other kind. [The trial judge] was not asked to grant equitable relief... After discussing the common law test for the influence of mistake on contract formation, his Honour said - [60] There is not and could not, I would think, ever be an exhaustive judicial definition of what is against good faith; only very broad limits are set by proceeding by analogy from circumstances in which judicial remedies are based on good faith, unconscionability, or other concepts closely related to good faith. I would include the passage cited from Taylor v Johnson among the many conceivably available sources from which to proceed by analogy. "Against good faith" is an expression which requires the impeachment of the intention or behaviour of the person whose good faith is impugned. 11. The operation of this rule was considered in Coles v Burke (1987) 10 NSWLR 429. Kirby P (with whom Samuels & McHugh JJA concurred) said (at 437) - The genus which is involved in the phrase "irregularly, illegally or against good faith" appears to me to be misconduct or dishonourable conduct of the person who procured the judgment which it is suggested undermines the authority of that judgment warranting the exceptional course for which r 12A provides. Here, there was no such lack of good faith on the part of the claimants. The signing of the judgment was made in accordance with the authority of the order earlier consented to and after a warning had been given by the letter to which I have referred. It is perhaps undesirable, in the modern practice of the legal profession (where much give and take is required) that judgment should be signed in this way without a final telephone call or other warning. However, the failure to give such a final and further warning could not, on any view, amount to a lack of good faith. Therefore, r 12A, likewise, has no application to these circumstances. 18Dr Xabregas asserts that the Owners of Strata Plan 79205 breached good faith in registering the subject costs certificates as a judgment of this Court by: (1)Entering judgment when there were still on foot proceedings concerning the same subject matter in the Supreme Court, where judgment had been reserved. (2)Entering judgment after having represented to Dr Xabregas that they would not do so in the proceedings before White J. (3)Entering judgment contrary to the terms of Clause 15(ii) of the parties' Deed dated 14 October 2011. 19Mr Holt denies that any representation of the type suggested by Dr Xabregas was made and contends that there was no breach of good faith by his client and that the judgment was properly entered. He submitted that the costs order the subject of the costs certificates and judgment do not relate to the current reserved proceedings before the Supreme Court but to the earlier 2011 proceedings. He says his client was perfectly entitled to have those costs orders (which have never been varied) assessed and for judgment to then be entered, particularly when the relevant 2011 and 2012 costs orders were not the subject of challenge before White J. While it appears that no notice of his client's intention to enter judgment was given to Dr Xabregas, that lack of notice could not, having regard to what Kirby P said in Coles v Burke (1987) 10 NSWLR 429, amount to a lack of good faith. 20It is of course for Dr Xabregas to persuade me that the judgment was entered against good faith, and she has not done so. I am unable to conclude on the basis of the evidence before me the behaviour of Mr Holt's client in registering its unchallenged costs certificates was so dishonourable or reprehensible as to undermine the authority of the judgment in the way described by Kirby P in Coles v Burke (supra). I would not propose to set aside the judgment on this ground.

Was the judgment entered irregularly? 21Ritchie's Uniform Civil Procedure NSW observes at paragraph [36.15.10] that "The entry of judgment is irregular if it has occurred in contravention of the rules" or "where it has been entered contrary to a material requirement of the rules.... A judgment will also be considered irregular where there is material which strongly suggests that it has been entered for more than is due". The irregularity must be of consequence going to the basic nature of the claim. 22Dr Xabregas relies, in support of this ground of irregularity, upon the decision of Ward J in Kassem & Secatore (as joint liquidators of Pan Pacific Age Care Services Pty Ltd (in liq)) v Koutavas [2012] NSWSC 236. The facts in that case were similar to those in the matter before the court. In Kassem an order for party/party costs was made against Ms Koutavas. An assessment of those costs was made by a Costs Assessor following which two certificates were issued, one being a Certificate of Determination of Costs pursuant to s 368 of the Legal Profession Act and the other being a Certificate of Determination of Costs of Costs Assessment pursuant to s 369 of that Act. Both of the Certificates were filed in the Registry of the Supreme Court and in due course a judgment issued for the aggregate of the two certificates. It will be observed that this is what here. It was argued by Ms Koutavas before Ward J that the entry of the judgment against her for the aggregate sum of the two Certificates was irregular for the reasons that s 369 of the Legal Profession Act entitles only the Manager, Costs Assessment to recover the costs of a costs assessment (and that accordingly, any judgment for those costs could only be in the Manager's favour). 23In Kassem, Ward J also discussed a number of cases dealing with the situation where a filing fee had been inappropriately added to a judgment debt based on costs certificates. Although not directly relevant to the primary question determined in Kassem, this aspect is relevant to an issue that arose before me, it being conceded by Mr Holt that the sum of $84.00 (being the registration/filing fee) had been improperly added to the judgment entered against Dr Xabregas in this court, and that as a consequence judgment had been entered for an amount greater than that due. 24Following a detailed exposition of the law, Ward J concluded that the judgment against Ms Koutavas had been entered irregularly, because it included an amount payable in respect of the costs of the costs assessment, which amount given the provisions of the Legal Profession Act were payable to the Manager, Costs Assessment. Her Honour noted that the irregularity affecting the judgment was one that arose from an application of the court rules and the statutory provisions of the costs assessment scheme itself. Ward J held that while the judgment should be set aside as irregular, basic justice required regard to be had to the amount for which the judgment creditor was out of pocket in respect of the costs of the costs assessment and for which Ms Koutavas was liable, and for those costs to be reimbursed. In coming to this conclusion, her Honour said as follows: 49. The answer to the practical dilemma posed to a party in the position of the plaintiffs in these circumstances (where the party who has been found not to be liable to pay the costs of the costs assessment but has been effectively compelled, in order to obtain the costs certificate, to pay those costs and then is left without the benefit of a judgment debt in its favour for those costs notwithstanding the registration of the costs of costs assessment certificate) seems to me to be found in the restitutionary principles under which a person who has made a payment under compulsion of law that operates to discharge the primary liability of another is entitled to reimbursement by that other. 50. Goff and Jones (The Law of Restitution, 5th ed, 1998) cite a passage from the first edition of Leake on Contracts, as quoted by Cockburn CJ in Moule v Garrett (1872) LR 7 Ex 101 at 104 as the classic statement of this common law principle: Where the plaintiff has been compelled by law to pay, or being compellable by law, has paid money which the defendant was ultimately liable to pay, so that the latter obtains the benefit of the payment by the discharge of his liability; under such circumstances the defendant is held indebted to the plaintiff in the amount. 51. Goff and Jones note that to found a right to restitution of the moneys paid, three matters must be established: first, that the payer was compelled, or was compellable, by law to make the payment; second, that the payer did not officiously expose himself to the liability; and third, that the payment discharged a liability of the defendant. 52. As to the first of those matters, the learned authors emphasise that the compulsion must be by law and that a moral obligation to make the payment would not suffice (Goff and Jones, 5th ed, at 438). Similarly, a contractual obligation to make payment also would not suffice (The Esso Bernicia [1989] AC 643, where payments made to discharge damages claims on behalf of the parties liable therefore, pursuant to an agreement with those parties, were characterised as voluntary or gratuitous). However, a statutory obligation amounts to compulsion by law (Brook's Wharf & Bull's Wharf Ltd v Goodman Bros [1937] 1 KB 534), as does payment made pursuant to the execution of a judgment debt (Edmunds v Wallingford (1885) 14 QBD 811) and in the present case the statute recognises that costs certificates may be withheld until payment of the relevant costs (thus tantamount to statutory compulsion for payment of those amounts). 53. The second requirement prevents those who, by their own act, place themselves in a position where they are compelled to make the payment from claiming a right to restitution. Goff and Jones say at 445: The plaintiff's payment will not be officious if he has exposed himself to liability at the request, express or tacit, of the defendant, or if he has been forced to place himself in the position which rendered him liable to make the payment, or, perhaps, if he has intervened as a matter of necessity. In such cases if, in consequence of his intervention, he finds himself compelled to make the payment, he should be entitled to reimbursement. But if, in other circumstances, he freely and without request undertakes the risk of liability, he generally has no right to any direct reimbursement, even though he is compelled to make the payment. (my emphasis) 54. Finally, with respect to the third requirement, this will usually be satisfied where the payer and other party are subject to a common demand. An example is where the owners of a warehouse were subject to the statutory obligation to pay customs duties owed by their customers (Brooks Wharf). However, there are cases where there is no common demand and the payment still operates to discharge the liability of another party (Exall v Partridge (1799) 8 TR 308). That said, the liability of the other person must be discharged. If the liability remains even after payment is made, then the payer does not have a right to reimbursement of the moneys paid. 55. Here, the compulsion to make payment of the costs of the costs assessor arises by virtue of the statutory requirement that the costs assessor forward the s 369 Certificate to the Manager, Costs Assessment and notify the parties that the certificate will be available (by inference, only) on payment of the costs of the costs assessor. The Costs Assessor has no discretion in this regard. There is, in my opinion, an implicit requirement imposed by the statutory regime that in order to obtain the costs certificates payment of the costs of the costs assessment must be made. 56. The plaintiffs did not place themselves in a position to make payment officiously, but were required to do so by the practical effect of the procedure set out in the statutory regime for costs assessments. By paying the costs of the cost assessor, the plaintiffs have met the claim for costs by the costs assessor and have thus discharged the liability of the cost respondent to pay those costs as assessed under the s 369 certificate (if the costs respondent sought to contend otherwise then it would be difficult to see how she could resist a claim by the Manager, Costs Assessment directly to enforce the costs judgment arising on the filing of the costs certificate). Therefore, it seems to me that the plaintiffs have a right of reimbursement against the defendant for the payment of the costs of the cost assessor as determined under the s 369 Certificate. Any alternative scenario would postulate either the need in every case for the Manager, Costs Assessment to commence enforcement proceedings or the recipient of the costs order to commence those proceedings and join the Manager, Costs Assessment as a party to compel the recovery through that officer of the costs payable by the party against whom the costs order was made. This surely cannot have been the intention of the legislature as it is inconsistent with the statutory mandate for the just, quick and cheap resolution of the real issues in dispute (s 56 of the Civil Procedure Act 2005). 57. In the present case (where there has been nothing to suggest that there is any dispute as to the payment of the costs assessor's costs by the liquidators and any dispute as to the liability for those costs would have been dealt with by way of a review in the ordinary course) it seems to me that an order for reimbursement by Mrs Koutavas of the costs of the costs assessment as borne by the liquidators would be appropriate in order to remove the unjust enrichment of Mrs Koutavas that would otherwise occur were she to retain the benefit of the discharge by the liquidators of her costs liability to the Manager, Costs Assessment. 58. The present issue would not arise as a practical matter if the legislation made clear that the costs assessor had power to determine that the party liable under the assessment to pay the costs of the costs assessment should indemnify the party found not to be liable for those costs in respect of any amounts paid by that party in order to obtain the issue of the costs certificate (that being at present cast in doubt by subss (8) and (9)) or, alternatively, if the legislation made clear that the judgment arising on the filing of a costs certificate issued under s 369 was not simply a judgment for the "unpaid costs" but was a judgment obliging the party found liable to pay the costs of that costs assessment to indemnify any other party to the costs assessment for costs already paid by that other party to obtain the issue of the costs certificate. Amendment to the statutory regime for the assessment of costs would remove room for doubt in this regard. 59. The practical difficulty so identified in the present case would also be resolved if it is recognised that the formal entry of orders to give effect to the import of the judgment constituted by the filing of a s 369 certificate (and the determination contained therein that, as between the parties to the costs assessment, one identified party should pay the costs thereof), in circumstances where the s 369 certificate on its face discloses that the costs of the cost assessment have already been paid to the Manager, Costs Assessment by the party in whose favour judgment is to be entered, would be for orders to be entered first, that the party liable on the s 368 certificate pay the costs so assessed therein to the party in whose favour the determination is made; second, that the party liable on the s 369 certificate pay to the Manager, Costs Assessment the costs therein assessed as payable for the costs assessment, and, third, that if the s 369 certificate itself discloses that the costs therein have already been paid to the Manager, Costs Assessment (or there is other evidence to that effect filed at the time of filing of the certificate) then the party determined to be liable for the costs of the costs assessment reimburse the party who has paid those costs in order to obtain the release of the costs certificates. 60. In the present case, there is no dispute that the costs of the costs assessment (for which the costs assessor determined that Mrs Koutavas was liable) have been paid by the liquidators. Although, for the reasons above, I consider that the judgment entered on 9 November 2011 and amended on 10 February 2012 was entered irregularly (in that it included in the judgment debt payable to the plaintiffs an amount in respect of the costs of the costs assessment), the power to set aside judgments entered irregularly is discretionary and one that must be exercised having regard to all the circumstances of the case. 61. While it has been said that where a judgment has been obtained as a result of the plaintiff's irregular conduct or breach of good faith the defendant is generally entitled to set it aside as a matter of basic fairness (Anlaby v Praetorius (1888) 20 QBD 764, cited in Ritchie's at [36.15.10]), here the irregularity affecting the judgment is one that arises from an application made in accordance with the court rules (and in circumstances where the only suggestion that this might be irregular that can be found in the authorities was dismissed as inconsistent with the perceived intent of the statutory provisions in relation to cost assessment). 62. It seems to me that basic justice requires that account be taken of the fact that the liquidators remain out-of-pocket for moneys paid in respect of costs for which Mrs Koutavas has been determined to be liable. Hence, in the exercise of the discretion to set aside the costs judgment for irregularity it is necessary in my view for orders to be made that appropriately recognise and give effect to the cost determinations that have been made. 63. I am not satisfied that, absent consent from the defendant, there is power pursuant to r 36.16 to vary the judgment in the manner that I consider would be appropriate in this case. However, having regard to the fact that the discretion to set aside an irregularly entered judgment can be made on terms and having regard to: the acknowledged technicality of the irregularity, the desirability of avoiding the incurring of unnecessary costs in further litigation by the liquidators to recover an amount already determined to be payable by Mrs Koutavas and the small amount of money in issue (that has probably already been exceeded by the costs of the present application), I consider that the appropriate course is to set aside the judgment entered on 9 November 2011 and amended on 10 February 2012 and in its place to enter judgment as follows: 1. Kanella Koutavas is to pay to the plaintiffs the sum of $17,131.22 in respect of the costs determined under the Certificate of Determination of Costs issued pursuant to s 368 of the Legal Profession Act 2004 (NSW) on 20 October 2011. 2. Kanella Koutavas is to pay to the plaintiffs the sum of $962.14 by way of reimbursement to the plaintiffs of the costs of the costs assessor determined under the Certificate of Determination of Costs issued pursuant to s 369 of the Legal Profession Act 2004 (NSW) on 20 October 2011 and paid by the plaintiffs (or any one or more of them) in order to obtain the release of the respective costs certificates issued on that date in proceedings 2011/264774. 3. Pursuant to Pt 36 r 36.4(3) of the Uniform Civil Procedure Rules 2005 (NSW), I order that Order 1 take effect as of 9 November 2011. 25As is clear from the above, the judgment the subject of dispute in Kassem was set aside and new judgments were entered for each of the sums identified in the costs certificates, those judgments to take effect from the date that the initial judgment (that had subsequently been set aside) had been entered. In doing so, her Honour had regard to the common law principles of restitution, the technicality of the irregularity, the desirability of avoiding the incurring of further unnecessary costs and the small amount of money in issue. 26Given Kassem, its close factual similarity to the position in this matter, and its binding authority, it seems to me that the judgment entered against Dr Xabregas on 29 January 2014 should be set aside as irregular. I would however propose to do so on terms identical with those adopted by Ward J. Basic justice and common law restitutionary principles require that I do so. I have also had regard to the technical nature of the irregularity, the fact that Dr Xabregas does not in any real sense contest her eventual liability for the costs as ordered or the costs of the costs assessment, the fact that no application for a review of the costs assessed was ever lodged, and the overriding purpose of the Civil Procedure Act as set out in section 56, being the facilitation of "the just, quick and cheap resolution of the real issues in the proceedings". In making the Order that I propose in this regard I will exclude the $84.00 registration/filing fee that Mr Holt concedes was not properly claimed.

Are the subject costs orders interlocutory orders? 27This question can be resolved shortly. I am not of the view that the subject costs orders are interlocutory. This is for the simple reason that they were made as part of a series of orders that involved the final disposition of the initial proceedings before the Supreme Court numbered 2011/00244426. The fact that Dr Xabregas has sought an order in the present reserved proceedings before White J that touches upon the means of enforcement that may be pursued by the Owners of Strata Plan 79205 does not in my assessment impinge in any way upon the final nature of the costs orders themselves. Those two issues, being the finality of the order and its means of enforcement, are separate and distinct.

Should a stay be ordered? 28Dr Xabregas' Amended Notice of Motion seeks a permanent stay of enforcement of the judgment entered on 29 January 2014. The Court's power to stay proceedings derives from section 67 of the Civil Procedure Act, which provides: Subject to rules of Court, the court may at any time and from time to time, by order, stay any proceedings before it, either permanently or until a specified day. The Court also has the additional power to stay execution pursuant to s 135 of the Civil Procedure Act, which provides: 135 Directions as to enforcement (1) The court may, by order, give directions with respect to the enforcement of its judgments and orders. (2) Without limiting subsection (1), the court may make any of the following orders: (a) an order authorising the Sheriff to enter premises for the purpose of taking possession of goods under a writ of execution, (b) an order prohibiting the Sheriff from taking any further action on a writ, (c) an order prohibiting any other person from taking any further action, either permanently or until a specified day, to enforce a judgment or order of the court, (d) an order requiring the Registrar-General to cancel any recording of a writ for the levy of property that, under section 105 of the Real Property Act 1900, has been made in the Register under that Act, either generally or in relation to specified land. The relevant provision in the circumstances of this case is subsection (2)(c). 29The power to stay can be exercised by the court when justice requires it to do so. It is for the applicant for the stay to demonstrate a reason or an appropriate case to warrant the favourable exercise of the court's discretion: see Alexander v Cambridge Credit Corp Ltd (1985) 2 NSWLR 685 at 694. Often a stay of execution will be granted pending appeal, but may also be ordered in other circumstances including where there exists a set off or cross claim against the subject judgment. A judgment may be stayed permanently if to do so would avoid an abuse of process. In determining whether to grant a stay, the court must weigh the competing rights of the parties. A temporary stay may be appropriate to enable related proceedings in another court to proceed first to determination: see Sterling Pharmaceuticals Pty Ltd v Boots Co (Australia) Pty Ltd (1992) 34 FCR 287 at 292 and L & W Developments Pty Ltd v Della [2003] NSWCA 140 at [47] and following. 30In Sterling Pharmaceuticals, Lockhart J had the following to say at 290-1: The court has a general power to control its own proceedings, and that power extends to enable it to order a temporary stay of proceedings in various circumstances including the case where proceedings are pending in another court and it is desirable that those proceedings should proceed to their conclusion first.... The court is a superior court of record and obviously may control its own proceedings including, where appropriate, the exercise of a power to grant a stay.... In my opinion relevant considerations to be taken into account in the present case include the following: · Which proceeding was commenced first. · Whether the termination of one proceeding is likely to have a material effect on the other. The public interest. · The undesirability of two courts competing to see which of them determines common facts first. · Consideration of circumstances relating to witnesses. · Whether work done on pleadings, particulars, discovery, interrogatories and preparation might be wasted. · The undesirability of substantial waste of time and effort if it becomes a common practice to bring actions in two courts involving substantially the same issues. How far advanced the proceedings are in each court. · The law should strive against permitting multiplicity of proceedings in relation to similar issues. · Generally balancing the advantages and disadvantages to each party. 31Dr Xabregas argues that because she has sought an Order in the Supreme Court proceedings before White J which concerns how the costs the subject of the judgment in this Court can be enforced, and whether or not those costs must be levied against her Lot in the Strata Plan, any enforcement in the Local Court should be stayed pending his Honour's determination of this question. I have earlier set out in full at paragraph 12 of these Reasons the order sought by Dr Xabregas in this regard. 32Bearing in mind the considerations set out by Lockhart J in Sterling Pharmaceuticals I note that: (1)The proceedings in the Supreme Court were heard by White J and his decision reserved, prior to the entry of judgment in this Court. (2)If Dr Xabregas is successful in the Supreme Court and White J makes Order 6 as sought by her then the Owners of Strata Plan 79205 may not be able to enforce their judgment arising from the costs orders made in 2011 and 2012 in the manner presently contemplated. It may be necessary for the judgment amounts to be charged against Dr Xabregas' real estate than her being pursued personally. That determination is not one for this Court. (3)It is not desirable or proper for this Court to make or decline to make orders that have the capacity to cut across or be potentially conflicting with Orders that may be made in a reserved Supreme Court decision. (4)It is not proper or desirable for this Court to engage in speculation as to the likely outcome of reserved Supreme Court proceedings. 33Given the above and after careful consideration I have determined that a stay of enforcement should be granted to Dr Xabregas pending determination of the proceedings by White J and the delivery of his Honour's judgment. For the avoidance of confusion I am of the view that it would not be appropriate to order a permanent stay of the type sought in the Amended Notice of Motion. Such a stay would generally only be ordered if the court was satisfied that to do so was necessary to avoid an abuse of process, and then would only be made with great circumspection: see Commonwealth of Australia v Cockatoo Dockyard Pty Ltd [2003] NSWCA 192. This is not such a case.

Conclusion 34I propose, as earlier indicated, to set aside the judgment entered 29 January 2014 and to enter judgment in a manner consistent with the approach taken by Ward J in Kassem. I then propose to order a temporary stay of execution of that judgment. Dr Xabregas' Amended Notice of Motion will be otherwise dismissed. Given that Dr Xabregas has, when viewed overall, been successful in her Amended Notice of Motion, I do not propose to make any order in respect of costs. 35Orders (1)I set aside the judgment entered 29 January 2014 and in its place enter judgment as set out in Orders 2, 3 and 4 hereof. (2)Benvinda Aura Nunes Xabregas is to pay to the Owners Strata Plan No 79205 the sum of $71,090.12 in respect of the costs determined under the Certificate of Determination of Costs issued pursuant to s 368 of the Legal Profession Act 2004 (NSW) on 17 September 2013. (3)Benvinda Aura Nunes Xabregas is to pay to the Owners Strata Plan No 79205 the sum of $3,087.05 by way of reimbursement to the Owners Strata Plan No 79205 of the costs of the costs assessor determined under the Certificate of Determination of Costs of Costs Assessment issued pursuant to s 369 of the Legal Profession Act 2004 (NSW) on 17 September 2013 and paid by the Owners Strata Plan No 79205 in order to obtain the release of the respective costs certificates issued on that date in proceedings 2013/0165919. (4)Pursuant to Part 36 Rule 36.4(3) of the Uniform Civil Procedure Rules 2005 (NSW) I order that Orders 2 and 3 take effect as of 29 January 2014. (5)I order that execution of the judgments set out above be stayed pending the delivery of judgment by the Honourable Justice White in respect of the Notice of Motion filed by Benvinda Aura Nunes Xabregas on 13 November 2013 in Supreme Court proceedings 2013/327776. (6)The Notice of Motion is otherwise dismissed. (7)No Order as to Costs. Magistrate C O'Brien Downing Centre Local Court 2 June 2014

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: 03 July 2014