Richmond Valley Council v JLT Risk Solutions Pty Ltd (Costs – Declassing Motion) [2021] NSWSC 584

Supreme Court New South Wales

Medium Neutral Citation: Richmond Valley Council v JLT Risk Solutions Pty Ltd (Costs – Declassing Motion) [2021] NSWSC 584 Hearing dates: On the papers Decision date: 24 May 2021 Jurisdiction: Equity - Commercial List Before: Hammerschlag J Decision: (1) JLT is to pay Richmond's costs of the declassing motion (2) The costs of the questions motion will be costs in the cause Catchwords: COSTS – Failed application by the defendant for an order that proceedings no longer continue as a class action – Heard together with an application for Merck orders – Declassing application fails – Court makes Merck orders identifying common questions – Whether the defendant should pay the costs of the declassing application – HELD – It should Cases Cited: Richmond Valley Council v JLT Risk Solutions Pty Ltd [2021] NSWSC 383 Category: Costs Parties: Richmond Valley Council – Plaintiff JLT Risk Solutions Pty Ltd – Defendant Representation: Counsel: R. Yezerski and C. Mitchell – Plaintiff M.J. Darke SC with I.J.M. Ahmed and A.M. Hammond – Defendant

Solicitors: Quinn Emanuel Urquhart & Sullivan – Plaintiff Herbert Smith Freehills – Defendant File Number(s): 2018/371447

JUDGMENT 1. HIS HONOUR: On 16 April 2021, I made Merck orders and dismissed the defendant's declassing motion filed 9 December 2020: Richmond Valley Council v JLT Risk Solutions Pty Ltd [2021] NSWSC 383 (the Judgment). Defined terms in the Judgment are used here. 2. I provisionally ordered that JLT pay Richmond's costs of the declassing motion and that the costs of the questions motion (which was the vehicle for the Merck orders) be costs in the cause, but I gave the parties the opportunity to seek some other order. 3. Richmond does not seek different orders. JLT seeks an order that the costs of both the declassing motion and the questions motion be costs in the cause. Each party made brief written submissions. 4. Richmond takes the position that the costs of the declassing motion should follow the event, and it should therefore have them because the motion failed. 5. JLT argues that the costs of the two motions should be dealt with in the same way because they both hinged on whether there was a substantial common question of law or fact to which the claims of Richmond and each of the group members gave rise, and because the parties had mixed success in the debate on that question. JLT points out that Richmond originally put up a series of non-common questions and ultimately provided 19 revised questions, of which only two were found to be common. 6. Identifying common questions for the purpose of Merck orders is a conventional and almost inevitable process necessary for the efficient running of a class action. Because of the nature of the process, it will not be uncommon that parties will have mixed success in the debate. It will in most cases be appropriate that the costs of a responsible debate directed to a proper formulation of common questions be costs in the cause. 7. The declassing motion is in a different category. Its purpose was to bring the proceedings to an end as a class action. This endeavour failed. As was pointed out in the Judgment at [36], these proceedings are entirely appropriate to be brought as a class action. JLT chose to bring on that motion before the questions motion had run its course. 8. Under paragraph [57] of Practice Note SC Eq 3, which governs proceedings in this List, unless otherwise ordered a party in whose favour an order for costs is made may proceed to assessment of such costs forthwith. A party who moves a motion in this List with a view to bringing a class action (or for that matter any other action) to an end, and fails, runs the risk of an immediately assessable costs order against it, notwithstanding that the contest is interlocutory. This reflects the ethos of the list that interlocutory skirmishes should be kept to a minimum and be brought only where they are truly necessary 9. With respect to the declassing motion, I see no reason to depart from the usual position that costs follow the event. 10. It may be that, on assessment, the costs attributable only to the declassing motion are modest given that part of the debate was common. This does not mean that the successful party on that motion should not have its costs, including the costs of the argument with respect to costs. 11. The orders of the Court are: 1. JLT is to pay Richmond's costs of the declassing motion; and 2. the costs of the questions motion will be costs in the cause.