FEDERAL COURT OF AUSTRALIA Ron Englehart Pty Ltd v Enterprise Constructions (Aust) Pty Ltd (No 2) [2010] FCA 1168 Citation: Ron Englehart Pty Ltd v Enterprise Constructions (Aust) Pty Ltd (No 2) [2010] FCA 1168 Parties: RON ENGLEHART PTY LTD (ACN 005 657 554) v ENTERPRISE CONSTRUCTIONS (AUST) PTY LTD (ACN 067 405 896) and SAFAK ARLEN DERVISH File number: VID 537 of 2009 Judge: JESSUP J Date of judgment: 29 October 2010 Catchwords: PRACTICE AND PROCEDURE – Costs – Amendment to defence and dismissal of cross claim – Whether applicant entitled to costs thrown away by reason of amendment to defence, and its costs of cross-claim – Whether applicant entitled to costs of cross-claim on indemnity basis PRACTICE AND PROCEDURE – Costs – Copyright infringement action – Applicant failed in proceeding generally yet succeed on subsistence issue – Whether applicant entitled to costs of subsistence claim – Whether such costs should be taxed on indemnity basis PRACTICE AND PROCEDURE – Costs – Respondents succeeded in proceeding generally and therefore entitled to costs – Whether such costs should be taxed on an indemnity basis – Whether respondents should be denied costs attributable to preparing evidence alleged by applicant to be misleading – Whether respondents should be denied costs attributable to serving notices to produce alleged by applicant to be unreasonable Legislation: Copyright Act 1968 (Cth ) s 202 Federal Court Rules O 33 r 12, O 15 r 6 Date of hearing: Heard on the papers Date of last submissions: 2 September 2010 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 30 Counsel for the Applicant: Mr C Golvan and Dr S Ricketson Solicitor for the Applicant: Middletons Counsel for the Respondents: Mr P Cawthorn and Mr C Madder Solicitor for the Respondents: Coolabah Law Chambers IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 537 of 2009 BETWEEN: RON ENGLEHART PTY LTD (ACN 005 657 554) Applicant AND: ENTERPRISE CONSTRUCTIONS (AUST) PTY LTD (ACN 067 405 896) First Respondent SAFAK ARLEN DERVISH Second Respondent JUDGE: JESSUP J DATE OF ORDER: 29 October 2010 WHERE MADE: MELBOURNE THE COURT ORDERS THAT: 1. Subject to Orders 2 and 3 below, the first respondent pay the applicant's costs incurred only in connection with the first respondent's Cross‑claim filed on 20 August 2009. 2. The applicant's entitlement to its costs incurred in connection with the allegations in paras 24-27 of the Cross‑claim be limited to those incurred on or before 18 February 2010. 3. The costs incurred by the applicant only in connection with paras 22-23 of the Cross-claim be taxed on an indemnity basis. 4. The respondents pay the applicant's costs – (a) incurred after 20 August 2009 in connection with the allegation that copyright subsisted in the plans for the "Monomeeth" house and in that house; and (b) incurred after 8 April 2010 in connection with the allegation that copyright subsisted in the plans for the "Monomeeth 101" house and in that house. 5. The applicant pay one‑half of the respondents' costs of and incidental to the parties' appearance before the court on 8 April 2010. 6. The respondents pay the applicant's costs incurred only in resisting the respondents' application, made by memorandum dated 19 August 2010, to have the costs awarded in their favour taxed on an indemnity basis. 7. There be no order as to the parties' costs of the applicant's costs application made by memorandum dated 19 August 2010. 8. Save as aforesaid, the applicant pay the respondents' costs except – (a) the costs of the first respondent's Cross-claim; (b) costs incurred resisting the applicant's allegation that copyright subsisted in any work; and (c) the costs of the respondents' said application to have their costs taxed on an indemnity basis. 9. The parties have liberty to apply on the question of 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 Federal Law Search on the Court's website. IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 537 of 2009 BETWEEN: RON ENGLEHART PTY LTD (ACN 005 657 554) Applicant AND: ENTERPRISE CONSTRUCTIONS (AUST) PTY LTD (ACN 067 405 896) First Respondent SAFAK ARLEN DERVISH Second Respondent JUDGE: JESSUP J DATE: 29 October 2010 PLACE: MELBOURNE REASONS FOR JUDGMENT 1 On 12 August 2010, I gave judgment for the respondents in this matter: Ron Englehart Pty Ltd v Enterprise Constructions (Aust) Pty Ltd [2010] FCA 820. Since then, the parties have made written submissions on the question of costs, and these reasons deal with the issues raised therein. 2 The proceeding was commenced in the Fast Track List of the Court on 21 July 2009, at which time the applicant asserted copyright in the "Monomeeth" house, and in the plans therefor, and in another house which ultimately was not contentious at trial, the "Saville", and in the plans therefor. It was alleged that both the "Sterling" and the "St James" houses were infringements of the applicant's copyright in both the Monomeeth and the Saville houses, and in the respective plans therefor. 3 In their Points of Defence filed on 20 August 2009, the respondents denied reproduction of any of the works upon which the applicant relied, adding that, if the Sterling plan and house were similar to the Saville plan and house, the former pre-dated the latter, and either the similarity was coincidental, or the respondents' own copyright in the Sterling plan had been infringed by the preparation of the Saville plans and by the building of the Saville house. However, after a mediation held on 27 January 2010, and after it became apparent to the respondents – as a result of discovery – that the Saville plan had been created prior to the public opening of the Sterling house, the respondents notified the applicant that they proposed not to persist with their allegation that the Saville plans and house were a reproduction of the Sterling plans or house. That was done on 18 February 2010, and the respondents' Points of Defence were formally amended pursuant to leave granted on 30 March 2010. 4 The applicant seeks its costs thrown away by reason of this amendment. The respondents counter that their allegation concerning the Saville plans and house was only ever made necessary because of the applicant's own allegation that the respondents' plans and houses were infringements of its copyright in the Saville plans and houses, an allegation with which it did not persist and which, according to the respondents, ought never to have been made. 5 I am presently concerned only with the respondents' Points of Defence. Those points were raised in defence to the applicant's allegations that the respondents had reproduced the Saville plans and house. Proof that the Saville plans and house were the original works of the applicant was part of the positive case required to be made by the applicant and would, it seems to me, necessarily have dealt with the point raised in the respondents' defence. As it happens, the applicant did not proceed with its allegation that the respondents had infringed copyright in the Saville plans and house. In the circumstances, it would be inappropriate to the require the respondents to pay so much of the applicant's costs as may have been involved in dealing with this aspect of the respondents' Points of Defence. 6 There is, however, another consequence of the involvement of the Saville plans and house in the early stages of the applicant's allegations. Together with the respondents' Points of Defence, on 20 August 2009 the first respondent filed a Cross-claim in which it was alleged that, if the Sterling plans and house were substantially similar to the Saville plans or house, then that similarity resulted from the applicant's reproduction of the Sterling plans and house, or a substantial part of them, in infringement of the first respondent's relevant copyright. On 30 March 2010, the first respondent consented to an order dismissing its Cross-claim. Costs were reserved, and the applicant now seeks its costs of the Cross-claim, on the basis that costs should follow the event. The first respondent resists that result, maintaining that the Cross-claim was closely bound up with its defence to the applicant's allegations about the Saville plans and house, and the fact is that those allegations were not persisted with. I do not think that this is a sufficient basis upon which to depart from the normal course. In its Points of Defence, the first respondent alleged that such similarity as existed as between the Sterling plans and house and the Saville plans and house was likely to have been the result of the applicant reproducing the former. That would have been sufficient for the first respondent to answer the applicant's case with respect to the Saville plans and house, so far as it went. However, the first respondent took the further step of filing a Cross-claim, and that was dismissed. I am not persuaded that there is any reason to depart from the normal course of giving the applicant its costs of the Cross-claim upon which it succeeded. 7 However, I shall qualify the applicant's entitlement to costs with respect to this aspect of the Cross‑claim in recognition of the circumstance that the first respondent advised the applicant of its intention to abandon the point in question by facsimile dated 18 February 2010. Upon receipt of that facsimile, the applicant ought not to have incurred any further costs in connection with the point. I shall limit my order in its favour to costs which were incurred on or before that date. 8 In its Cross-claim filed on 20 August 2009, the first respondent also alleged that, notwithstanding a letter sent by its solicitors on 17 July 2009 explaining, with details, that the applicant's claim had no substance, the applicant issued the present proceedings. The first respondent thus sought a declaration under s 202 of the Copyright Act 1968 (Cth) that the applicant had made unjustifiable threats to commence a proceeding. This aspect of the Cross-claim was also dismissed by consent on 30 March 2010: indeed, the Cross-claim as a whole was then so dismissed. There is no reason why the applicant should not have its costs in relevant respects, and here I would not limit my order to costs incurred up to 18 February 2010, since the first respondent's facsimile of that date did not foreshadow a withdrawal of its claim under s 202. 9 The applicant seeks that the costs of the Cross-claim to which it will be entitled be taxed an indemnity basis. With respect to the aspects of the Cross-claim which related to the Saville plans and house, such an approach would be inappropriate. It was not until the applicant provided its discovery that the first respondent might first have been able to appreciate that the preparation of the Saville plans pre-dated the first public exposure of the Sterling house. I could not conclude that the Cross-claim was, in this respect, one which ought not to have been brought. 10 However, the position is different with respect to so much of the cross-claim as sought to rely upon s 202 of the Copyright Act. Subsection (1) thereof reads as follows: Where a person, by means of circulars, advertisements or otherwise, threatens a person with an action or proceeding in respect of an infringement of copyright, then, whether the person making the threats is or is not the owner of the copyright or an exclusive licensee, a person aggrieved may bring an action against the first‑mentioned person and may obtain a declaration to the effect that the threats are unjustifiable, and an injunction against the continuance of the threats, and may recover such damages (if any) as he or she has sustained, unless the first‑mentioned person satisfies the court that the acts in respect of which the action or proceeding was threatened constituted, or, if done, would constitute, an infringement of copyright. The relief available under this section is a declaration that threats of an action or proceeding are unjustifiable. The question which would arise is not whether the allegations of infringement lacked justification, but whether the threats of an action or proceeding lacked justification. In the very nature of things, by the time the first respondent commenced its Cross-claim, the applicant had commenced the present proceeding. Such threats as it may previously have made that it would commence an action or proceeding could not, therefore, have been regarded as unjustifiable. The justification was in the event: the commencement of this proceeding. I agree with the submission made on behalf of the applicant that so much of the Cross-claim as was based upon s 202 was misconceived and ought not responsibly have been instituted, and that the circumstances fall within one of the conventional categories in which the Court's discretion to order the taxation of costs on an indemnity basis is enlivened. I propose to follow that course. 11 The next point raised by the applicant related to its claim that copyright subsisted in the works upon which it sued. While it failed in the proceeding generally, the applicant contended that subsistence was a discrete issue with respect to which the respondents, realistically, never had a likely defence, and which, acting reasonably in the spirit of the objectives of the Fast Track List, they ought to have conceded. The respondents say that the issue was not discrete at all, and that it was, rather, wound up with the identification by the applicant of the actual plans to which, it was alleged, the respondents had had direct or indirect access, and, in the case of indirect access, with the identification of the intermediate media which gave rise to it (the applicant's brochure, for example). The respondents say that, until the applicant's opening at trial, it was not clear quite how it would be contended that they (the respondents) had had access to the works upon which the applicant would rely and, therefore, it was not clear which were the works in which the applicant would be required to establish that copyright subsisted. 12 I consider that the respondents are here inappropriately connecting the question of subsistence with the questions of access, and therefore, of reproduction. In the Statement of [its] Claim as it stood from time to time, the applicant made it clear what were the works upon which it relied and, by correspondence dated 9 March 2010, it made a proposal to the respondents, which was not unreasonable in the circumstances, that time and costs should be saved by the respondents making appropriate concessions. In the result, the respondents did not challenge the applicant's claim to copyright in the works upon which it sued. In effect, they put the applicant to its proof, in circumstances where there never was any plausible basis upon which they might resist the proposition that copyright subsisted. Although this was part of the applicant's case – a case which ultimately failed on other grounds – I consider it to be consistent with the need for efficiency in contemporary litigation that a respondent should make concessions where appropriate. The present was, in my view, such an occasion. 13 There are two respects in which I would qualify the applicant's entitlement to the costs of its subsistence claim. First, I would confine those costs to those which related to the plans and houses upon which the applicant ultimately relied at trial. Although the applicant opened on the Monomeeth 102, the Monomeeth 104 and the Monomeeth 105, ultimately it did not submit that any of them had been reproduced, in whole or in substantial part, by the respondents. I can see no reason to allow the applicant its costs of establishing subsistence of copyright in works which ultimately played no part in its actual case against the respondents. Secondly, I would not require the respondents to pay the applicant's costs incurred before the passing of a reasonable period after the making of the subsistence allegations in question. Since the basis of my award of costs in favour of the applicant is that the respondents, acting reasonably, ought to have conceded those allegations, it follows that the costs which the applicant will get under this heading must be confined to those that were incurred after the point at which the respondents, acting reasonably, ought to have made the relevant admissions. In the case of the Monomeeth plans and house, that point would be the filing of the respondents' Points of Defence on 20 August 2009; and, in the case of the Monomeeth 101 plans and house, that point would be the filing of the respondents' Amended Points of Defence on 8 April 2010. 14 The applicant also submits that its costs of making good its subsistence allegations should be taxed on an indemnity basis, for the reason that the respondents' refusal to make the necessary concessions was unreasonable, and caused substantial delay and expense. It is not at all apparent to me, however, how the respondents' conduct of their case in relevant respects caused delay and, to the extent that it caused the applicant expense, the applicant will have its costs in the normal way, in accordance with the determinations which I have made above. I could not hold that the respondents were acting unreasonably to withhold the concessions which the applicant sought, since they were entitled to proceed in that way. The basis upon which I shall award costs against the respondents in these areas is that they chose to keep the subsistence point in contest, when there was no realistic basis upon which to anticipate success in relevant respects. Thus the costs incurred in the establishment of the applicant's case should be to the respondents' account. But I would not go further and hold that this was a course which the respondents could, on no view, reasonably have adopted, or that they should be criticised in the strong terms conventionally associated with an indemnity costs order. These costs should, therefore, be taxed on the conventional basis. 15 The applicant's next point relates to the circumstances to which I referred in paras 45 and 46 of my reasons of 12 August 2010. It contended that Mr Dervish's first witness statement was misleading, and that the respondents should not have their costs of preparing it. The applicant contended also that the respondents should pay its own costs incurred only by reason of the misleading witness statement, namely, reviewing that statement and the associated documents, preparing to cross-examine Mr Dervish on the basis of that statement, the additional time spent in court and preparing for, and conducting, the proceeding generally as if the witness statement were truthful. The applicant rejected the suggestion that Mr Dervish could be forgiven the misleading witness statement on the basis that it was not until Mr Factor produced his file on subpoena that the true facts with respect to the documents that were sent to him by Mr Dervish could most reliably be established: it contended, rather, that the documents in Mr Factor's files fell within the respondents' discovery obligations, and that they had fallen short in the proper discharge of them. 16 I should deal with the applicant's discovery point first. Part 7 of the Fast Track Directions of the court provides as follows: 7.1 Except where expanded or limited by the presiding judge, discovery if ordered in proceedings to which the Fast Track Directions apply will be confined to documents in the following categories: (a) documents on which a party intends to rely; and (b) documents that have significant probative value adverse to a party's case. 7.2 Discovery must be provided in accordance with the following: (a) Parties must provide discovery of any document within the limited discovery categories mentioned in paragraph 7.1 that a party knows of at the time of the Scheduling Conference, or that the party becomes aware of at a later point in the pre-trial or trial process, or that the party discovers in the course of a good-faith proportionate search of the party's documents and records. (b) A 'good-faith proportionate search' is a search undertaken by a party in which the party makes a good-faith effort to locate discoverable documents, while bearing in mind that the cost of the search should not be excessive having regard to the nature and complexity of issues raised by the case, including the type of relief sought and the quantum of the claim. (c) A party giving discovery must, if requested to do so by another party, provide a brief description of the steps the party has taken to conduct a good faith proportionate search to locate discoverable documents. 7.3 A party may require additional discovery in relation to discrete issues, such as the quantification of damages. In that event the judge may make a separate order for that purpose. The order may include a requirement that discovery be given by inspection alone. 17 Under the Fast Track Directions, on 8 September 2009 Middleton J ordered the respondents to provide discovery of documents listed in a schedule to his Honour's order including the following: 1. All documents recording or relating to the creation of the Sterling Plan (as defined in the Statement of Applicant's Claim dated 21 July 2009 (Statement of Applicant's Claim)), including but not limited to notes of instructions, correspondence, minutes or notes of meetings, drawings, sketches, drafts of plans and plans. …. 3. All documents provided to Michael Factor by the Respondents or either of them in relation to the creation of the Sterling Plan including the documents referred to in paragraph 3 of the Respondents' Points of Defence dated 20 August 2009. 4. Documents evidencing the engagement of Michael Factor by the First Respondent in respect of the design of the Sterling Plan including evidence of any fees or commissions paid. 18 It appears to be implicit in the applicant's present submission that the documents retained by Mr Factor on his file, and not otherwise available to the respondents, would have been discoverable by the latter. Under a traditional discovery regime, it may be that Mr Factor would be regarded as the agent of the first respondent, and that the documents in his file were within its possession, custody or power: see O 15 r 6(2) of the Federal Court Rules. I do not, however, regard even this proposition as self‑evident, and the applicant's submissions on the present occasion were undeveloped in relevant respects. I would not, therefore, be prepared to use that circumstance, or potential circumstance, as the basis for denying the respondents the costs to which they would otherwise be entitled. However, given the terms of para 7.2 of the Fast Track Directions, I do not hold it to be established that the documents on Mr Factor's file were such as the respondents ought to have discovered in obedience to the order made by Middleton J on 8 September 2009. 19 Turning to the other dimensions of the applicant's present point, it would, of course, be wrong to imply (as the applicant did in parts of its written submission) that Mr Dervish's witness statement constituted "misleading evidence". Objectively, that statement was misleading, but it was not in the form of an affidavit, and it was not given as evidence. The applicant commenced the proceeding in the Fast Track List of the court, which placed the respondents under some time pressures in the preparation of their evidentiary cases which related to events which had occurred more than nine years previously. Although I accept that Mr Dervish may be properly criticised for taking less than scrupulous care in the preparation of his witness statement, and particularly in the preparation of exhibit "SD 1", there could be no suggestion that he was not acting in good faith, or that he was not making a real attempt to provide a written record of what he recalled about the relevant events. I am not prepared to criticise him in the terms that would be necessary to justify a denial to the respondents of the costs to which they would normally be entitled, or an allowance to the applicant of costs to which it would not normally be entitled. 20 The applicant's next point related to Notices to Produce served by the respondents on 6, 8 and 10 April 2010, pursuant to the procedure for which O 33 r 12 provides. It was submitted on behalf of the applicant that the documents to which these notices referred travelled beyond the categories of documents of which it had been required to give discovery, that the notices themselves amounted to an attempt to obtain "back-door" discovery, that the terms of the notices were wide and oppressive, that the notices were oppressive also by being served very late in the piece, and that most of the documents referred to in the notices were irrelevant to the case, or, if arguably relevant, were not used in evidence by the respondents in any event. The respondents appeared to have satisfactory answers to most of these objections. They contended – and the applicant did not deny – that the point to which the notices related was introduced into the litigation only by an amended statement of the applicant's claim filed on 1 April 2010. It was, therefore, beside the point that the classes of documents requested had not been referred to in the discovery orders made in September 2009. It is true that few of the documents were ultimately referred to in the evidence, but that cannot be the criterion by reference to which I should consider whether the respondents acted reasonably in serving the Notices to Produce: a party is entitled to adopt the procedure for which O 33 r 12 provides without falling under any implicit obligation to use the documents produced as part of its evidentiary case. Subject to what I say in the next paragraph, I consider that the respondents' costs associated with these Notices to Produce should be its costs in the cause in the normal way, and should be costs to which they are entitled as the successful parties. 21 At an interlocutory hearing before me on 8 April 2010, the applicant voiced a number of objections with respect to the respondents' Notice to Produce served on 6 April 2010. A number of those objections were upheld, and, in orders which I made that day, I modified the applicant's obligation to comply with the notice. I reserved the costs of that occasion, and I now hold it to be appropriate that the respondents should be entitled to one half only of their costs of that interlocutory hearing. The orders which I make will reflect that conclusion. 22 Save to the extent specifically dealt with above, the respondents will have their costs of the proceeding. 23 The respondents submitted that their costs should be taxed on an indemnity basis. The principal proposition which underlay this claim was that the applicant should have known from the outset, or at least from the time it received Mr Factor's first witness statement, that the proceeding could not succeed and that, therefore, it ought to be inferred that the proceeding was commenced, and continued, for the ulterior purpose of driving the first respondent out of business. This submission was reinforced by reference to two further circumstances: first, although Mr Englehart apparently knew about the Sterling house some time in 2003, it was not until some years later, when the first respondent opened a display house in a suburb close to where Mr Englehart himself lived, that the present proceeding was commenced; and secondly, the monetary claims of the applicant were, according to the respondents, wildly exaggerated, and beyond anything which the applicant might realistically expect to achieve. If there is substance in these submissions, and if the proceeding were commenced or continued for an ulterior purpose, the court's discretion to award the respondents their costs on an indemnity basis would undoubtedly be enlivened. However, for reasons which follow, I am not persuaded that the respondents' submissions should be accepted. 24 At the point where the proceedings were instituted, the applicant had every right to consider that it had quite reasonable prospects of success. As the evidence of Dr Cooke demonstrated, the similarities between its own plans and houses and the Sterling house were clear to see. Those similarities, in my view, justified the applicant in taking the view, which I infer it did, that there was at least a prima facie case which the respondents were required to meet. The first witness statement of Mr Factor would not have been good news for the applicant, but, as the applicant itself pointed out on the present occasion, the first witness statement of Mr Dervish presented, at least in some respects, a less than fully convincing response to the applicant's case. Even when all the respondents' witness statements had been filed, I cannot see how it could be regarded as outside the conventional range of professional judgment for the applicant's advisers to take the view that the recollections of Mr Dervish and Mr Factor should be tested in court against the objective indications of similarity upon which the applicant strongly relied. On one view, of course, the applicant was taking something of a risk that matters would ultimately be shown to be as Mr Factor and Mr Dervish asserted in their witness statements. That was, however, a matter entirely between the applicant and its advisers. On no view could it be concluded, even during the conduct of the trial, that the case was one which the applicant could never win: much less that the applicant should now be criticised for not having perceived as much at an earlier stage. 25 No reading of my reasons of 12 August 2010 could justify the view that this was, and ought to have been perceived by the applicant as, a case which never had any prospects. My decision in favour of the respondents was not an obvious one, and was made only after a detailed consideration of the objective circumstances of similarity upon which the applicant relied and of the way in which the events played out in February 2000, particularly with respect to the communications passing between Mr Dervish and Mr Factor. Significantly, the respondents' ultimate success depended in no small measure upon their own evidence, and upon how the evidence stood generally after Mr Factor and Mr Dervish had been cross‑examined. The circumstances are, in my view, a long way from justifying the conclusion that the applicant should have known – either always or at any relevant time – that its case was doomed to fail. 26 Neither do I consider that the applicant's election not to commence the present proceeding until some years after Mr Englehart first knew of the Sterling house should be regarded as evidence of an ulterior purpose. It was not suggested that Mr Englehart not only knew of the Sterling house in 2003 but then had sufficient access to the plans therefor to permit him to draw the conclusions of objective similarity upon which the present proceeding was based. If it were the case that Mr Englehart considered, at some earlier time, that he had a cause of action in copyright against the respondents, he then came under no legal or moral obligation to proceed immediately (save, of course, to the extent that the applicant may have sought discretionary remedies). I also consider that Dr Cooke's evidence of similarity is sufficient, of itself, to dispose of the suggestion that there never was a basis upon which Mr Englehart might have concluded that the respondents had infringed the applicant's copyright. 27 The respondents attempted to persuade me that the applicant's damages claims were wildly exaggerated, with respect both to the suggestion that a licence fee approach would be appropriate on the assessment of damages and to the amount said by the applicant to represent a reasonable licence fee in the circumstances of its business. I am, of course, at something of a disadvantage here because the respondents' success in the proceeding generally has had the result that I have given no consideration to, and made no determination on, the applicant's damages case. The unwisdom of a court trying some aspect of a concluded case just for the purposes of awarding costs has often been emphasised. It is a course which, save in a very clear case, I would be reluctant to follow. It is sufficient for present purposes to say that nothing in the submissions actually made by the respondents has persuaded me, that the description "wildly exaggerated", in any sense that would imply culpability, should be applied to the applicant's claims in relevant respects. Neither alone nor in conjunction with the other points made on behalf of the respondents does this point justify the conclusion that the proceeding was commenced or continued for an ulterior purpose. 28 For the above reasons, I reject the respondents' submission that their costs should be taxed on an indemnity basis. 29 That leaves the costs of the present application with respect to costs. The only respect in which the respondent succeeded on their costs application was with respect to what was a two‑line submission that, as the successful parties, they should have their costs in the conventional way. Save in relation to the matters with which I have dealt above, the applicant did not resist that proposition, and was never likely to do so. The balance (12 pages) of the respondents' submissions related to its claim for indemnity costs. That claim was wholly unsuccessful, and I can think of no reason why the applicant should not have its costs of resisting it. The applicant has, I would measure, been about one‑half successful on its own costs application, in which circumstances I am disposed not to make any order as to the costs thereof, but to allow such costs to lie where they fall. 30 I shall make orders consistent with the foregoing reasons. I certify that the preceding thirty (30) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jessup. Associate: Dated: 29 October 2010