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Federal Court of Australia |
Last Updated: 21 January 2005
FEDERAL COURT OF AUSTRALIA
Brookfield v Yevad Products Pty Ltd [2005] FCA 19
PRACTICE AND PROCEDURE – orders – costs orders
– costs sought on an indemnity basis – where applicants filed
various notices of
motion – where orders sought unlikely to be
made.
IAN
WALTER BROOKFIELD AND SEPTIC PRODUCTS AUSTRALIA PTY LTD (IN LIQ) v YEVAD
PRODUCTS PTY LTD (FORMERLY KNOWN AS DAVEY PRODUCTS PTY
LTD) (ACN 004 813
192)
SAD 112 of 1993
LANDER
J
21 JANUARY 2005
ADELAIDE
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IAN WALTER BROOKFIELD
FIRST APPLICANT SEPTIC PRODUCTS AUSTRALIA PTY LTD SECOND APPLICANT |
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AND:
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YEVAD PRODUCTS PTY LTD
RESPONDENT |
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DATE OF ORDER:
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WHERE MADE:
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THE COURT ORDERS THAT:
1. The applicants pay the respondent’s costs of and incidental to the notice of motion filed on 14 December 2004 on an indemnity basis.
2. No order as to costs of the notices of motion of 20 October 2004 and 8 December 2004, which includes the hearing on 18 January 2005.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
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AND:
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REASONS FOR JUDGMENT
1 This is an application by the respondent that the applicants pay the respondent’s costs in relation to three notices of motion dated 20 October 2004, 8 December 2004 and 14 December 2004 issued by the applicants. The respondent seeks costs on an indemnity basis.
2 On 9 September 2004 I published reasons in which I indicated that I would set aside orders made by the trial judge in this matter dismissing the applicants’ application and ordering the applicants to pay the respondent’s costs. I said at [420]:
‘ In my opinion, the interests of justice will be served by setting aside the order made by Branson J on 8 February 1996 dismissing the applicants’ application and ordering the applicants to pay the respondent’s costs. There should also be an order setting aside the order made by Branson J varying the order for costs made on 8 February 1996 and providing that the first applicant pay the respondent’s costs specified in the sum of $380,493.82.’
3 I invited the applicants (who were unrepresented) to bring in short minutes to reflect and to give effect to the reasons published that day.
4 On 21 September 2004 the applicants provided the respondent with ‘Proposed Minutes of Consent Orders’ in which they sought the following orders:
‘1. The orders made by Branson J on 8 February 1996 and 8 May 1998 be set aside.
2. The orders made by the Full Court on 12 September 1996 be set aside.
3. All other orders made for costs in favour of the respondent be vacated.
4. The respondents and its solicitors Piper Alderman and Thomson Playford pay the applicants’ costs of this proceeding including all reserved costs on an indemnity basis.
5. The respondent and its solicitors pay interest on the costs so fixed at the rate prescribed from time to time pursuant to Order 35 Rule 8 of the Federal Court Rules.
6. The total amount of costs payable pursuant to order 4 is fixed at $2,230,000.00.
7. Otherwise this proceeding be transferred to the Melbourne Registry of the Federal Court and be listed for Directions.’
5 On 28 September 2004 the applicants provided the respondent with further ‘Proposed Minutes of Consent Orders’ in which they sought the following orders:
‘1. The judgement of Justice Branson in action number SG1121 [sic] of 1993 dated 8 February 1996 be set aside.
2. The order of Justice Branson in action number SG112 of 1993 dated 19 December 1997 be set aside.
3. The applicants issue any notice of motion seeking further orders on or before 1 October 2004.
4. The applicants file and serve any affidavit material on which they seek to rely on or before 12 October 2004.
5. The respondent file and serve any affidavit material on which it seeks to rely on or before 26 October 2004.
6. The matter be listed for hearing at a date no earlier than 26 October 2004.
7. Costs reserved.’
6 On 20 October 2004 the applicants, who were then represented by Slater and Gordon, filed a notice of motion returnable on 26 October 2004 seeking the following orders:
‘1. The judgement of Justice Branson in action number SG1121 [sic] of 1993 dated 8 February 1996 be set aside.
2. The order of Justice Branson in action number SG112 of 1993 dated 19 December 1997 be set aside.
3. All other orders made for costs in favour of the respondent in the proceeding be vacated.
4. The respondent or its solicitors Piper Alderman and / or Thomson Playford pay the applicants’ costs of this proceeding including all reserved costs on an indemnity basis.
5. Such costs as are awarded be fixed by the Court on a lump sum basis.
6. In the alternative such costs be taxed in default of agreement.
7. The respondent and its solicitors Thomson Playford pay the expenses incurred by the applicants arising out of application to set aside the judgement of Branson J dated 8 February 1996 and the orders arising therefrom.
8. The respondent and its solicitors pay interest on the costs so fixed at the rate prescribed from time to time pursuant to Order 35 Rule 8 of the Federal Court Rules.
9. This proceeding be transferred to the Melbourne Registry of the Federal Court and be listed for trial Directions.
10. The respondents pay the cost of this application.’
7 An affidavit sworn by Mark Johnathan Walter, a partner in the firm of Slater and Gordon, was filed with that notice of motion. Mr Walter exhibited communications between his firm and the respondent’s solicitors in relation to the orders to be made. I have not relied upon anything in that affidavit in consideration of these matters. Nor did I have regard to the contents of that affidavit in making the orders on 23 December 2004.
8 On 31 October 2004 the respondent filed draft Minutes of Order seeking the following orders:
‘1. So much of the judgment of Justice Branson in Action No: SG 112 of 1993 given on 8 February 1996 be set aside as:
1.1 Dismissed the claim of the Second Applicant, and the First Applicant as assignee, for breach of the term implied by section 14 I of the Sale of Goods Act in those contracts alleged in the Statement of Claim which related to the sale by the Respondent to the Second Applicant of Doc 3 pumps;
1.2 Ordered the Applicants to pay the Respondent’s costs in respect of that claim.
2. That the order of Justice Branson in Action No: SG 112 of 1993 given on 19 December 1997 fixing a lump sum for the Respondent’s costs be set aside.
3. The originating Application be referred to Branson J for further directions.
4. The application of the Applicants referred to in paragraphs 3 to 10 of the Notice of Motion dated 20 October 2004 filed herein be adjourned to for further consideration.
5. The oral applications made by the Respondent on 1 November 2004 for costs be adjourned to for further consideration.
6. The Applicants file and serve upon the Respondent, Thomson Playford and Piper Alderman any affidavits in support of the applications referred to in paragraphs 4, 6, 7, 8 and 9 of the said Notice of Motion on or before
7. The Respondent, Thomson Playford and Piper Alderman file and serve upon the Applicants and each other within days of service of any affidavit filed and served by the Applicants pursuant to the order referred to in the preceding paragraph any affidavits in response thereto.
8. The Respondent file and serve upon the Applicants any affidavits in support of its said oral applications for costs made on 1 November 2004 on or before ’
9 The respondent, of course, did not thereby accept the correctness of my reasons for judgment but were, in paragraphs 1 and 2 of the draft Minutes of Order, contending for the orders which flowed from those reasons.
10 The respondent’s draft Minutes of Order raised the question whether I should simply set aside the orders made by Branson J on 8 February 1996 or set aside ‘so much of the judgment of Justice Branson’ as referred to in those draft Minutes of Order.
11 The draft Minutes of Order also contemplated that, on the next day, when the matter was listed for hearing, the respondent would apply for costs.
12 The matter came on before me on 1 November 2004 when the applicants were represented by a solicitor from Slater and Gordon.
13 On 1 November 2004 not only were the applicants and the respondent represented but so also were the solicitors for Messrs Piper Alderman and Thomson Playford, against whom orders were sought in paragraph 4 of the notice of motion.
14 On 1 November 2004 I made orders directing that the applicants file any further affidavits which they may be advised in support of the orders sought in the notice of motion and adjourned the matter for hearing until 3 December 2004. I reserved the question of costs of that hearing.
15 On 30 November 2004 Mr Brookfield filed and served an affidavit apparently in support of the notice of motion of 20 October 2004.
16 In that affidavit Mr Brookfield set out some of the history pertaining to the conduct of the various proceedings including the legal representatives retained by the applicants from time to time. Mr Brookfield deposed to numerous attempts by him to contact the respondent’s parent company McPherson’s Limited, and to his belief that McPherson’s Limited was not only instructing and financing the conduct of the litigation but was also liable vicariously for the conduct of Davey Products Pty Ltd. He also deposed to the costs which the applicants had incurred in conducting the trial of the matter and referred to a failed mediation.
17 He said in his affidavit that he believed that an order for costs should be made against McPherson’s Limited payable forthwith.
18 When the matter was called on again on 3 December 2004 Mr Brookfield advised the Court that he was no longer represented by Slater and Gordon.
19 He advised me that he had withdrawn his claim against Messrs Piper Alderman and Thomson Playford. Insofar as the notice of motion sought orders against those solicitors, the notice of motion was dismissed, with the consent of those solicitors and with the consent of the parties, with no order as to costs.
20 On that occasion, Mr Brookfield also indicated that he no longer sought the order proposed in paragraph 9 of the notice of motion.
21 It was pointed out to Mr Brookfield at this hearing that McPherson’s Limited had not been given notice of any claim for costs against it.
22 After some argument, which is unimportant, I directed the applicants to file a proposed amendment to the notice of motion filed on 20 October 2004 by Wednesday, 8 December setting out the precise orders which the applicants sought to have set aside as a consequence of my reasons for judgment delivered on 9 September 2004 and setting out the orders the applicants sought by way of costs against the respondent and any other party.
23 On 8 December 2004 the applicants filed a document entitled ‘Amended Notice of Motion’ in which they sought the following orders:
‘1). The judgement of Justice Branson in action number SG112 of 1993 dated the 8th of February 1996 be set aside.
2). The order of Justice Branson in action number SG112 of 1993 dated the 19th of December 1997 be set aside.
3). All other orders made for costs in favour of the first respondent in the proceedings be vacated as follows;
Orders made;
a). 12th of September 1996 Full Court.
b). 19th of May 1998, O’Loughlin J.
c). 16th of September 1998.
d). 12th of April 2000, Mansfield J.
e). 22nd of February 2001, Mansfield J.
f). 6th of November 2002, Mansfield J.
g). 6th of November 2002, Von Doussa J.
h). 15th of August 2003, Mansfield J.
4). The costs of the 30th of May 1997 Re; High Court special leave application be stayed until application is made by the applicant’s [sic] to the High Court to vacate the cost order.
5). That the second respondent pays the applicant’s [sic] cost [sic] forthwith as per annexure "IWB 11" of the affidavit of the first applicant, pursuant to Order 35 Rule 8 of the Federal Court Rules.
6). That the costs sought by the applicant’s [sic] be treated as a lump sum for costs purposes.
7). In the alternative the costs be treated as exemplary damages.
8). That the first respondent’s failure to comply with the Federal Court Rules of discovery be treated as contempt. Re; Paragraphs 178, 384, 385, 417 and 418 of the judgement of Lander J 9th September 2004.
9). That the first respondent be required to file and serve a verified list of discovery in the above action pursuant to the Federal Court rules, prior to the filing of any other documents in these proceedings.’
24 The matter came on for hearing before me again on 10 December.
25 The document to which I have referred in paragraph [23] of these reasons purported to be both an ‘Amended Notice of Motion’ and an ‘Amended Outline of Submissions’ of the applicants. In those amended outline of submissions, the applicants sought costs against McPherson’s Limited.
26 No application was made in the amended notice of motion to join McPherson’s Limited as a party to the proceedings, but the applicants had in the document which they filed simply purported to add McPherson’s Limited as a second respondent.
27 At that hearing on 10 December 2004 I drew to Mr Brookfield’s attention the inappropriateness of adding McPherson’s Limited as a second respondent to the title of the action without first obtaining an order.
28 I directed the applicants to file and serve whatever proceedings they intended against McPherson’s Limited and to identify the orders sought, and to file and serve any supporting evidence or material so that the matter could be heard on 17 December 2004.
29 During that hearing, I pointed out to Mr Brookfield that some of the matters sought, both in the original notice of motion of 20 October and the amended notice of motion of 8 December, could never succeed.
30 No doubt, as a result of the matters raised at that hearing on 10 December 2004, the applicants filed a further notice of motion seeking the following orders:
‘1). That McPherson’s Limited be joined as second respondent in the above action.
2). That a cost order be made against McPherson’s limited [sic] in favour of the applicant’s [sic].
3). That the cost order be paid forthwith.
4). Such further or other orders as this Honorable [sic] Court deems fair and just.’
31 That notice of motion was accompanied by a further affidavit of Mr Brookfield sworn on 14 December 2004.
32 The matter came on before me again on 17 December 2004.
33 At that time, the respondent’s counsel handed up two documents identifying the objections which the respondent took to Mr Brookfield’s affidavits of 30 November and 14 December 2004.
34 The respondent’s counsel was content for me to proceed upon the basis that I would rule upon the admissibility of those affidavits at some later time. I did, however, exclude paragraphs 18 to 21 of Mr Brookfield’s affidavit of 30 November 2004 and ordered that exhibits IWB4 and IWB5 to that affidavit be sealed until further order, on the ground that the material disclosed in those paragraphs and exhibits was confidential.
35 On the hearing of the issues now before me, the respondent’s counsel pointed out that I did not indicate in my reasons for judgment on 23 December 2004 what matters I had regard to in Mr Brookfield’s affidavits for the purpose of those reasons and the orders made on that day.
36 My reasons indicate that I did not have regard to any of the matters contained in Mr Brookfield’s affidavit of 30 November 2004. There was no need, in those circumstances, to rule on the admissibility of the affidavit paragraph by paragraph. In my opinion, there was nothing in the affidavit which was relevant in a consideration of the matters upon which the orders were made.
37 I did have regard to some matters raised by Mr Brookfield in the second affidavit of 14 December 2004. In particular, I had regard to the matters to which I have referred in paragraph [44] of my reasons of 23 December 2004: Brookfield v Yevad Products Pty Ltd [2004] FCA 1717.
38 I also had regard to the absence of evidence that McPherson’s Limited had directed the respondent in its defence: see paragraphs [49] and [50]. Otherwise, I have treated the second affidavit as largely irrelevant.
39 Again, it does not seem to me to be necessary therefore to rule on the admissibility of that affidavit paragraph by paragraph.
40 There were two main matters which were agitated in the hearing before me on 17 December 2004, which occupied most of the afternoon. First, whether I should set aside the orders made by Branson J on 8 February 1996 or, as contended for by the respondent, whether I should only set aside so much of her Honour’s judgment as dismissed the claim of the second applicant and first applicant as assignee for breach of the term implied by s 14 I of the Sale of Goods Act in those contracts alleged in the statement of claim which related to the sale by the respondent to the applicants of Doc 3 pumps.
41 On that argument the respondent was unsuccessful.
42 Secondly, whether McPherson’s Limited should be joined as sought by the applicants.
43 On that matter the applicants were unsuccessful.
44 On 23 December 2004 I made the following orders:
‘1. Paragraph 1 of the orders made by Branson J in the within action on 8 February 1996 be set aside.
2. Paragraph 2 of the orders made by Branson J in the within action on 8 February 1996 be set aside.
3. The order made by Branson J on 19 December 1997 be set aside.
4. The respondent pay the applicants’ costs thrown away by reason of the respondent’s failure to make proper and appropriate discovery.
5. There will be no order for costs of the notice of motion.
6. The application to join McPherson’s Limited is dismissed.
7. Insofar as any party requires leave to appeal from paragraphs 5 and 6 of these orders, leave is granted.
8. Extend the time for any party to appeal from these orders until 31 January 2005.’
45 The respondent now seeks the costs of the notices of motion of 20 October, 8 December and 14 December 2004 on an indemnity basis.
46 In my reasons, which were published on 23 December 2004, which form the basis of the orders made on that date, I did not deal with the costs of these notices of motion.
47 I dealt with the orders made by the trial judge on 8 February 1996 and 19 December 1997 and set them aside. In setting aside paragraph 1 of the orders made on 8 February 1996, I set aside the order made by the trial judge dismissing the applicants’ application. In setting aside paragraph 2 of the orders made on 8 February 1996 and the order made on 19 December 1997, I set aside the orders for costs made by the trial judge in favour of the respondent.
48 In paragraph 4 of the orders of 23 December 2004, I substituted for the order for costs made in favour of the respondent by the trial judge an order that the respondent pay the applicants’ costs thrown away by reason of the respondent’s failure to make proper and appropriate discovery in respect of that trial.
49 In paragraph 5 of the orders I made no order for costs of the notice of motion by the applicants seeking to set aside the orders made by the trial judge on 8 February 1996 and 19 December 1997.
50 I meant by that order that there should be no order for costs up and until 9 September 2004 in relation to the applicants’ notices of motion to set aside the orders of Branson J.
51 On this application the respondent contends that in making that order I have dealt with the costs of the competing contentions between the applicants and the respondent in relation to the setting aside of Branson J’s orders made on 8 February 1996. I did not intend that to be so. Such a result would be unfair to the applicants.
52 The respondent submitted that in respect of all three notices of motion it should be entitled to costs on an indemnity basis. The contention was that all of the matters raised in the notices of motion were doomed to fail.
53 It may be accepted that a lot of the matters raised in the first place by the applicants’ then solicitors and, in the second place, by the applicants themselves were futile and were bound to fail. For example, there was never any prospect that orders would be made in the terms sought in paragraphs 6, 7 and 8 of the amended notice of motion.
54 It may also be accepted that other matters were abandoned. Paragraph 3 of the amended notice of motion was abandoned. Paragraph 4 was not pursued.
55 However, those matters occupied little time in the various hearings after 9 September 2004.
56 The first real issue to be determined following upon my reasons was whether I should set aside both orders made by Branson J on 8 February 1996. It was conceded by the respondent that the costs order made by her Honour on 19 December 1997 had to be set aside. The next issue was what costs order should be made in substitution for the costs order made by the trial judge. The next main issue was what costs order should be made in relation to the notice of motion seeking to set aside her Honour’s orders.
57 The only other issue of substance raised was whether or not McPherson’s Limited should be joined.
58 As I have already said, the respondent succeeded in relation to the application to join McPherson’s Limited. It was also successful in resisting an order for costs of the notice of motion seeking to set aside her Honour’s orders.
59 It failed in relation to its claim that only some part of her Honour’s order made on 8 February 1996 should be set aside.
60 In those circumstances, it is not possible to say that the respondent is entitled to all of the costs since 9 September 2004 or on an indemnity basis.
61 In my opinion, the respondent is entitled to the costs on the notice of motion of 14 December 2004 in which the applicants sought to join McPherson’s Limited. That application was always doomed to fail. In my opinion, the respondent is entitled to costs on an indemnity basis in relation to that application because, during the previous hearings, it had been pointed out to Mr Brookfield that it was unlikely that any order for costs would be made against McPherson’s Limited in circumstances where McPherson’s Limited had never been on notice that any such order was claimed prior to Mr Brookfield filing and serving his affidavit of 30 November 2004. Notwithstanding that indication, the applicants filed and served that notice of motion.
62 There will be an order:
1. That the applicants pay the respondent’s costs of and incidental to the notice of motion filed on 14 December 2004 on an indemnity basis.
63 As I have already said, the applicants were unsuccessful in a number of other aspects of the claims made in the notices of motion of 20 October and 8 December 2004, more particularly those identified in the amended notice of motion. Those applications were always bound to fail.
64 They were, however, successful in relation to the orders relating to her Honour’s orders and partly successful in relation to the order for costs made in substitution of her Honour’s orders for costs.
65 In the order in paragraph [62] of these reasons I have already indemnified the respondent by way of costs in relation to the application to join McPherson’s Limited.
66 Leaving aside the time taken in respect of the application to join McPherson’s Limited and the application that it should pay the applicants’ costs, I assess that the time taken in relation to a consideration of her Honour’s orders occupied 50 per cent of the remaining time.
67 As I have said, the applicants were successful in relation to those matters. On the other hand, the respondent was successful in relation to the other matters which occupied the other 50 per cent of the Court’s time.
68 In those circumstances, it would be appropriate to make no order as to costs in relation to the notices of motion of 20 October and 8 December 2004. There will be an order:
2. No order as to costs of the notices of motion of 20 October and 8 December 2004 which includes the hearing on 18 January 2005.
Associate:
Dated: 21 January 2005
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Counsel for the First Applicant:
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The First Applicant appeared in person
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Counsel for the Second Applicant:
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Mr I W Brookfield
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Counsel for the Respondent:
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Mr J Wells QC with Mr H Abbott
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Solicitor for the Respondent:
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Thomson Playford
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Date of Hearing:
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18 January 2005
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Date of Judgment:
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21 January 2005
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