Parramatta 176 Pty Ltd v Chadox Pty Ltd [2022] NSWSC 414

Supreme Court New South Wales

Medium Neutral Citation: Parramatta 176 Pty Ltd v Chadox Pty Ltd [2022] NSWSC 414 Hearing dates: On the papers Date of orders: 8 April 2022 Decision date: 08 April 2022 Jurisdiction: Equity Before: Darke J Decision: Judgment to be entered for the plaintiff against the defendants in the sum of $15,834.05. Order that the defendants pay the plaintiff's costs of the proceedings. Catchwords: COSTS – claim by plaintiff for relief in respect of trespass to land – plaintiff successful in obtaining relief, including damages for the cost of a fence removed by the defendants – whether plaintiff should be deprived of a costs order because of submitting appearance filed by defendants, "disentitling conduct" of plaintiff, or failure of plaintiff to accept a Calderbank offer – plaintiff held entitled to costs order in its favour Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW), r 42.1 Cases Cited: Kisimul Holdings Pty Ltd v Clear Position Pty Ltd (No 2) (2014) 86 NSWLR 645; [2014] NSWCA 317 Category: Costs Parties: Parramatta 176 Pty Ltd (Plaintiff) Chadox Pty Ltd (First Defendant) Paperock Pty Ltd (Second Defendant) Chad Hilton Loxsom (Third Defendant) Representation: Counsel: Mr G Farland (Plaintiff)

Solicitors: Landerer & Company (Plaintiff) SMB Law (Defendants) File Number(s): 2021/244071 Publication restriction: None

Judgment 1. These proceedings were commenced by Statement of Claim filed on 26 August 2021. The plaintiff sought declaratory and injunctive relief, and damages, in respect of alleged trespasses by the defendants upon a portion of the plaintiff's land in Leichhardt. The defendants filed a Notice of Appearance on 16 September 2021. On that day, an order was made for the defendants to file and serve any Defences by 8 October 2021. On 8 October 2021, an order was made extending the time for the filing and service of Defences to 22 October 2021. No Defences were filed. On 3 November 2021, the defendants filed a submitting appearance, save as to costs. 2. On 5 November 2021, the Court made orders substantially in accordance with the relief claimed in the Statement of Claim, save in respect of damages and costs. Amongst the orders made was an order requiring the defendants to remove various structures that encroached upon the plaintiff's land. 3. On 14 December 2021, the Court ordered that judgment be entered for the plaintiff for damages, with such damages to be assessed. Directions were made for the filing of evidence as to damages, and also for the provision of written submissions as to damages and costs. The timetable for evidence and written submissions was adjusted by further directions made by consent on 15 March 2022. Those orders envisaged that the assessment of damages and the question of costs could be dealt with on the papers. No party has since suggested that an oral hearing is necessary. 4. The Court has considered the evidence filed by the parties, namely, the affidavits of Mr David Royal of 31 January 2022 and 25 March 2022 for the plaintiff, and the affidavit of Mr Chad Loxsom of 17 March 2022 for the defendants. The Court has also considered the written submissions filed on 9 March 2022 and 1 April 2022 by the defendants (as to costs, and damages, respectively), and on 28 March 2022 by the plaintiff (as to both damages and costs). 5. I will first deal with damages. 6. The plaintiff claims damages for trespass in the sum of $22,516.55. That amount is calculated on the basis of: 1. $15,834.05 – being the cost of a fence that was removed by the defendants; and 2. $6,682.50 – being the anticipated cost to erect a replacement fence. The plaintiff no longer makes a claim for aggravated damages. 1. I am satisfied that the plaintiff's damages should be assessed in the amount of $15,834.05. The evidence is clear that the defendants removed the fence that had cost the plaintiff $15,834.05 to install. I think that expenditure can be regarded as a fair measure of the value of the fence to the plaintiff. 2. In reaching that conclusion, I have considered the defendants' submissions on damages. Whilst the making of these submissions seems contrary to the terms of the submitting appearance filed by the defendants, it is consistent with the tenor of the directions made by consent on 15 March 2022. In any event, I am not satisfied that the various matters raised by the defendants should lead to the plaintiff recovering only nominal damages, as contended by the defendants. 3. The fact that the fence was erected at a time when ownership of the "parcel of land" upon which it sat was in dispute does not support any such conclusion in circumstances where the defendants have abandoned their claim to the land. Nor is any such conclusion supported by the fact that the plaintiff erected the fence without first consulting the defendants. 4. The defendants complain about the inclusion of the cost of scaffolding, but I do not think that cost was unreasonably incurred. It seems that, without scaffolding, the fence could only have been constructed were the plaintiff to itself commit a trespass to land. The defendants further complain that the fence was higher than would be allowed under the requirements of the local Council. Even if that is so, the evidence does not suggest that this would have significantly increased the cost of the fence. It also does not justify the action of the defendants in taking the law into their own hands and removing the fence. It seems to me appropriate for the plaintiff to be compensated for the full cost of the fence erected. The fence was removed by the defendants quite soon after it was installed. Those wrongful acts deprived the plaintiff of the value of the fence. 5. However, I do not think that the plaintiff is entitled to recover, in addition, the cost of a replacement fence. That cost, if it is ever incurred, is not a loss suffered as a result of the defendants' wrongful acts. There is no reason to think that the plaintiff will not enjoy the benefit of that expenditure if it is incurred. 6. I turn now to the question of costs. 7. The defendants submitted that there should be no order as to costs up to 27 October 2021 and that the plaintiff should pay the defendants' costs on an indemnity basis from that date. The defendants primarily rely upon the fact that they promptly filed a submitting appearance, and also upon what is said to be "disentitling conduct" engaged in by the plaintiff. The indemnity costs claim is based on the plaintiff's failure to accept what is described as a Calderbank offer dated 27 October 2021. 8. The plaintiff seeks an order that the defendants pay its costs of the proceedings on the ordinary basis. The plaintiff says that the relevant question is whether its prima facie entitlement to costs pursuant to Uniform Civil Procedure Rules 2005 (NSW) r 42.1, arising from it being the successful party having won the "event", should be displaced by the fact that the defendants filed a submitting appearance. In this regard, the plaintiff referred to the decision of the Court of Appeal in Kisimul Holdings Pty Ltd v Clear Position Pty Ltd (No 2) (2014) 86 NSWLR 645; [2014] NSWCA 317 at [14], where it was stated that in such cases attention must be paid to the context in which the submitting appearance was filed. 9. In the present case, the defendants initially filed an ordinary appearance and suggested that they would, or at least might, defend the proceedings. The defendants thereafter decided not to defend the proceedings. They filed the submitting appearance on 3 November 2021. That occurred at a relatively early stage in the proceedings, and it facilitated the making of the orders in favour of the plaintiff on 5 November 2021. However, it remained necessary for the plaintiff to adduce evidence so that its damages could be assessed. These circumstances do not, in my view, provide a good reason to depart from the usual position that costs follow the event. The plaintiff incurred legal costs in pursuing a claim which the defendants elected not to defend, and ought to be compensated in respect of that expenditure. That conclusion is only reinforced by the fact that the defendants, despite the submitting appearance, have sought to challenge the plaintiff on the assessment of damages. 10. Further, I do not accept that the plaintiff has been guilty of any "disentitling conduct" as alleged. There was nothing improper about the plaintiff's commencement of the proceedings at a time when the defendants were obtaining legal advice about the matter. The plaintiff was prosecuting a valid claim. Nor was it unreasonable for the plaintiff to proceed at a time when the parties were in negotiations concerning a purchase of the disputed portion of land. The defendants assert that the plaintiff was itself guilty of a trespass to land, but this claim was not prosecuted in the proceedings by the defendants. In any case, I do not see why this would disentitle the plaintiff from claiming costs in respect of its own, valid, claim. The defendants also assert that the plaintiff has acted in a vindictive manner in order to obtain revenge against the defendants for their opposition to a development proposed by the plaintiff. Even if the plaintiff were so motivated in bringing the proceedings (and I make no finding to that effect), the fact remains that the proceedings were brought for the apparently proper purpose of obtaining the relief claimed. None of the matters raised by the defendants as "disentitling conduct" affords a sound basis to deprive the plaintiff of an order for costs. 11. Nor does the failure of the plaintiff to accept the defendants' offer made on 27 October 2021. The plaintiff, if it accepted the offer, would not have achieved a result as favourable as the result it has achieved through the orders made on 5 November 2021 and the award of damages it is to receive. The offer provided for the proceedings to be dismissed with no order as to costs, an undertaking from the defendants not to trespass upon the disputed land "unless an agreement in writing is reached", and for the parties to enter into negotiations concerning the disputed land. If the plaintiff were to achieve a more favourable outcome, it would be the result of further negotiations, not acceptance of the offer itself. In my opinion, it has not been shown that it was unreasonable for the plaintiff to not accept the offer. I note further that the offer was only open for acceptance for a period of 2 days. 12. For the above reasons, the Court will make the following orders: 1. Order that judgment be entered for the plaintiff against the defendants in the sum of $15,834.05; and 2. Order that the defendants pay the plaintiff's costs of the proceedings.