Coles Supermarkets Australia Pty Ltd v FKP Limited (No 2) [2009] FCA 150 (19 February 2009)

Last Updated: 12 March 2009

FEDERAL COURT OF AUSTRALIA

Coles Supermarkets Australia Pty Ltd v FKP Limited (No 2)

[2009] FCA 150

COLES SUPERMARKETS AUSTRALIA PTY LTD (ABN 45 004 189 708) v FKP LIMITED (ABN 68 010 729 950) and FKP LIFESTYLE PTY LTD (ABN 27 005 867 596)
VID 589 of 2008

GORDON J
19 FEBRUARY 2009
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VID 589 of 2008

BETWEEN:	COLES SUPERMARKETS AUSTRALIA PTY LTD (ABN 45 004 189 708) Applicant
AND:	FKP LIMITED (ABN 68 010 729 950) First Respondent FKP LIFESTYLE PTY LTD (ABN 27 005 867 596) Second Respondent

JUDGE:	GORDON J
DATE OF ORDER:	19 FEBRUARY 2009
WHERE MADE:	MELBOURNE

THE COURT DECLARES THAT:

1. The Applicant has a binding agreement with the Second Respondent that is comprised by the letter dated 22 December 2006 from Coles Group Ltd to the First Respondent (Offer letter), the Coles standard agreement for lease and the Coles standard lease annexed to the Offer Letter, and the Final Development Plans dated 19 November 2007 prepared by i2C Design & Management Pty Ltd.

THE COURT ORDERS THAT:

2. The Application is dismissed as against the First Respondent.
3. The Second Respondent specifically perform and carry into execution the agreement that is comprised by the letter dated 22 December 2006 from Coles Group Ltd to the First Respondent, the Coles standard agreement for lease and the Coles standard leased annexed to the Offer Letter, and the Final Development Plans dated 19 November 2007 prepared by i2C Design & Management Pty Ltd a copy of which was provided to the solicitors for the Second Respondent on 16 February 2009 in accordance with the Orders made by The Honourable Justice Gordon on that day.
4. The Second Respondent pay 75% of the costs of the Applicant in the proceeding including any reserved costs.
5. No other order as to costs.
   

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VID 589 of 2008

BETWEEN:	COLES SUPERMARKETS AUSTRALIA PTY LTD (ABN 45 004 189 708) Applicant
AND:	FKP LIMITED (ABN 68 010 729 950) First Respondent FKP LIFESTYLE PTY LTD (ABN 27 005 867 596) Second Respondent

JUDGE:	GORDON J
DATE:	19 FEBRUARY 2009
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

1. On 18 December 2008, I delivered reasons for decision in Coles Supermarkets Australia Pty Ltd v FKP Limited [2008] FCA 1915. On that date, I did not make final orders. Instead, I directed the parties to confer and jointly file minutes of proposed orders giving effect to those reasons, including orders as to the further conduct of the proceedings, by 4:00 pm on 23 January 2009, and in the event that the parties were unable to agree, to submit a joint statement by that date identifying points of agreement, points of disagreement, and the respective positions of the parties on those points of disagreement.
2. In accordance with those Orders, albeit late, I received notification from the parties that they could not agree on the final orders. The matter was listed for further hearing on 16 February 2009. As a result of what transpired at that hearing, I have now been provided with minutes of proposed orders in the following terms.

THE COURT DECLARES THAT:

1. The Applicant has a binding agreement with the Second Respondent that is comprised by the letter dated 22 December 2006 from Coles Group Ltd to the First Respondent (Offer letter), the Coles standard agreement for lease and the Coles standard lease annexed to the Offer Letter, and the Final Development Plans dated 19 November 2007 prepared by i2C Design & Management Pty Ltd.
   

THE COURT ORDERS THAT:

2. The Application is dismissed as against the First Respondent.

3. The Second Respondent specifically perform and carry into execution the agreement that is comprised by the letter dated 22 December 2006 from Coles Group Ltd to the First Respondent, the Coles standard agreement for lease and the Coles standard leased annexed to the Offer Letter, and the Final Development Plans dated 19 November 2007 prepared by i2C Design & Management Pty Ltd a copy of which was provided to the solicitors for the Second Respondent on 16 February 2009 in accordance with the Orders made by The Honourable Justice Gordon on that day.
   
4. The Second Respondent pay the costs of the Applicant in the proceeding including any reserved costs.
   
3. At the outset it should be noted that paragraph 2 of the proposed Orders is by consent. In relation to paragraphs 1 and 3 of the proposed Orders, the Second Respondent does not consent or oppose the making of the declaration in paragraph 1, or the order for specific performance in paragraph 3.
4. During the course of today’s hearing, I raised with Counsel for the Applicant and the Second Respondent that in the absence of consent to an order for specific performance, the Court was being asked to make an order that was discretionary in nature and which would usually have been only made in circumstances where the Court had considered the various matters raised in the authorities and after satisfying itself that it was not inappropriate for the Court to grant an order for specific performance in the terms set out in paragraph 3 of the proposed orders: e.g. see Nutbrown v Thornton (1804) 10 Ves 159; Blackett v Bates (1865) LR 1 Ch App 117; Lamare v Dixon (1873) LR 6 HL 414; Ryan v Mutual Tontine Assoc [1893] 1 Ch 116; Wolverhampton Corp v Emmons [1901] 1 KB 515; Stickney v Keeble [1915] AC 386; Cohen v Roche [1927] 1 KB 169; Beswick v Beswick [1967] UKHL 2; [1968] AC 58; Watts v Spence [1976] Ch 165; Patel v Ali [1984] 1 All ER 978; Posner v Scott-Lewis [1987] 3 All ER 513 and Co-Op Insurance v Argyll Stores [1997] 3 All ER 297.
5. In light of the submissions of Counsel for the Second Respondent as to the reasons why it is that the Second Respondent does not consent to but does not oppose such an order, and that the Second Respondent will abide by any Order made by the Court, I propose to grant the Order in the terms proposed in paragraph 3 above.
6. That leaves the question of costs. The Applicant seeks 100 % of its costs or, alternatively, all of its costs up to the date of the trial and 75 % of its costs of the trial. On the other hand, the Second Respondent objects to such an order and contends that the Applicant should only recover 50 % of its costs, including any reserved costs.
7. The principles in relation to costs are well-established: Re Wilcox; Ex parte Venture Industries Pty Ltd and Others (No 2) (1996) 72 FCR 151 at 152-153 per Black CJ; Ruddock v Vadarlis (2001) 115 FCR 229 at [9]-[18] per Black CJ and French J; Grey v Mango Pre Paid Calling Cards Pty Ltd [2005] FCA 362 at [4] per Nicholson J; Cirillo v Consolidated Press Property Ltd (No 2) [2007] FCA 179 at [3] per Finn J. First, it is discretionary. Secondly, costs usually follow the event. Thirdly, where a litigant has succeeded on only a portion of the claim, sometimes the circumstances make it reasonable that the litigant who was unsuccessful in part should bear that portion of those costs. In most general terms, the Applicant’s contractual claims succeeded, but its claims under the Trade Practices Act 1974 (Cth) (“TPA”) failed. Notwithstanding that some of the factual matters relied upon by the Applicant in relation to its TPA claims were the subject of the successful breach of confidence claim, it is also evident that a significant amount of time was spent on the unsuccessful TPA claims. In general terms, by the Applicant’s TPA claims, it sought to contest the sworn evidence filed by the Respondents that negotiations with Woolworths had only commenced from 26 February 2008. The Applicant sought to establish that those negotiations had commenced earlier. A significant part of the trial was spent seeking to establish that fact. The Applicant failed. In my view, it is appropriate in all the circumstances that the Applicant recover 75 % of all of its costs, including any reserved costs, and that the Respondents bear their own costs. The order will be in those terms.
   

I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gordon.

Associate:

Dated: 19 February 2009

Counsel for the Applicant:	Mr P Jopling QC with Mr B Quinn
Solicitor for the Applicant:	Freehills
Counsel for the Respondents:	Mr J Delany SC with Mr R Peters
Solicitor for the Respondents:	Arnold Bloch Leibler

Date of Hearing:	19 February 2009
Date of Judgment:	19 February 2009