Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Gokani v Visvalingam Pty Ltd [2023] NSWCA 80 Hearing dates: 3 April 2023 Date of orders: 26 April 2023 Decision date: 26 April 2023 Before: Leeming JA at [1]; Basten AJA at [2]; Griffiths AJA at [90] Decision: (1) Allow the appeal and set aside the orders made in the District Court on 26 July 2022. (2) In place of those orders, order that: (a) Visvalingam's amended notice of motion filed on 1 March 2022 be dismissed; (b) Visvalingam pay Mr Gokani's costs of the motion in the District Court. (3) Order that Visvalingam pay Mr Gokani's costs of the appeal. Catchwords: COSTS – personal costs order against solicitor for defendant – filing of defence – statement of claim deficient – no affirmative defence pleaded – whether costs incurred "without reasonable cause" – Civil Procedure Act 2005 (NSW), s 99 COSTS – costs order against solicitor – whether plaintiff's claim was for "damages" – statement of claim sought repayment of debt – Legal Profession Uniform Law Application Act 2014 (NSW), Sch 2, cl 5 EVIDENCE – appeal – further evidence – evidence available during trial – waiver of privilege – liquidator appointed to solicitor's client – privilege waived by liquidator – solicitor's file not produced – no reliance on proposed tender in course of submissions Legislation Cited: Civil Procedure Act 2005 (NSW), Pt 6, ss 60, 99 District Court Act 1973 (NSW), s 127 Legal Profession Act 2004 (NSW), ss 345, 348(1) Legal Profession Uniform Law Application Act 2014 (NSW), Sch 2, cl 5 Limitation Act 1969 (NSW), ss 50C, 50D Supreme Court Act 1970 (NSW), ss 75A, 101(2) Cases Cited: Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34 Degiorgio v Dunn (No 2) (2005) 62 NSWLR 284; [2005] NSWSC 3 Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Ltd (2013) 250 CLR 303; [2013] HCA 46 Keddie v Stacks/Goudkamp Pty Ltd [2012] NSWCA 254 King v Muriniti (2018) 97 NSWLR 991; [2018] NSWCA 98 Medcalf v Mardell [2003] 1 AC 120; [2002] UKHL 27 Murgolo v AAI Ltd t/as AAMI (2019) 101 NSWLR 376; [2019] NSWCA 295 Muriniti v Mercia Financial Solutions Pty Ltd [2021] NSWCA 180 Myers v Elman [1940] AC 282 Ridehalgh v Horsefield [1994] Ch 205 Visvalingam Pty Ltd v Vitarag Pty Ltd [2021] NSWDC 364 Category: Principal judgment Parties: Anand Kantilal Gokani (Appellant) Visvalingam Pty Ltd (Respondent) Representation: Counsel: DA Lloyd SC / Y Truong (Appellant) DS Weinberger (Respondent) Solicitors: Gilchrist Connell (Appellant) Chedid Storey Legal (Respondent) File Number(s): 2022/00238689 Publication restriction: N/A Decision under appeal Court or tribunal: District Court Jurisdiction: Civil Citation: Visvalingam Pty Ltd v Vitarag Pty Ltd (No 2) [2022] NSWDC 294 Date of Decision: 26 July 2022 Before: P Taylor SC DCJ File Number(s): 2018/47055 [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.] HEADNOTE [This headnote is not to be read as part of the judgment] The respondent Visvalingam Pty Ltd sued Vitarag Pty Ltd in the District Court for recovery of a loan of $94,000, plus interest. On 5 July 2021 Judge Taylor SC upheld the claim and ordered payment of $175,546.91. On 12 July 2021 Visvalingam filed a notice of motion in the District Court seeking an order that Mr Gokani, the solicitor who had acted for Vitarag, pay the costs of the proceedings pursuant to s 99 of the Civil Procedure Act 2005 (NSW). An amended notice of motion filed eight months later sought a similar order pursuant to s 62 and Sch 2, cl 5, of the Legal Profession Uniform Law Application Act 2014 (NSW) (Application Act). The motion was heard by Judge Taylor who ordered that Mr Gokani pay Visvalingam's costs of the proceedings on an indemnity basis, including the costs of the motion. Mr Gokani appealed. The issues on appeal were whether: (i) the respondent could tender further evidence on the appeal; (ii) the trial involved a "claim for damages" for the purposes of the Application Act, Sch 2; and (iii) whether filing a defence resulted in costs being incurred "without reasonable cause" under the Civil Procedure Act, s99. The Court held, allowing the appeal by Basten AJA (Leeming JA and Griffiths AJA agreeing): As to issue (i): (1) The further evidence sought to demonstrate the steps taken by the respondent to obtain Mr Gokani's file, including by reference to his limited attempt to obtain instructions to waive privilege and a subsequent waiver by the liquidator of Vitarag. In circumstances where the facts were known to the respondent before completion of the hearing of the costs motion, and where no reliance was in fact placed on the proposed evidence in the course of the appeal, the tender was refused: [12], [20]-[21]. As to issue (ii): (2) A claim for repayment of a loan with interest is not a claim for "damages". Even a reference to "loss and damage" in the initial pleading (later removed) did not create a claim to relief in the form of "damages". Accordingly, neither cl 2 nor cl 5 of Sch 2 to the Application Act was engaged: [27], [29]. As to issue (iii): (3) The defence was a denial of the claims made in the original statement of claim; the defence raised no affirmative factual issues. Further, the original statement of claim was deficient and required repleading. Indeed, the later pleading conceded that the plaintiff was not party to the original loan agreement. It followed that it was not filed "without reasonable cause" for the purposes of s 99 of the Civil Procedure Act: [52], [58], [66]. (4) The trial judge erred in finding that Mr Gokani had no subjective belief in the existence of reasonable cause. It is no part of a legal practitioner's role in litigation to form concluded views as to the existence of facts or the outcome of proceedings. There is also an important distinction between a belief as to a fact, the proof of which falls to the practitioner's client, and a belief as to a fact, the proof of which is imposed on the other party: [43]. (3) The evidence did not establish an absence of belief on the part of the solicitor when the defence was filed that the defence lacked reasonable prospects of success. Nor did the making of a claim against the solicitor impose a burden of disproof of the claim: [48]-[54], [56], [58]. JUDGMENT 1. LEEMING JA: I agree with Basten AJA. 2. BASTEN AJA: The appellant, Anand Kantilal Gokani, was the solicitor on the record for Vitarag Pty Ltd, the defendant in proceedings in the District Court brought by the respondent, Visvalingam Pty Ltd. Visvalingam had sought recovery of a loan of $94,000, plus interest, which it said had been made to Vitarag in 2008. The proceedings were commenced on 12 February 2018 and defended by Vitarag. Judgment was delivered on 5 July 2021, upholding Visvalingam's claim against Vitarag in an amount of $175,546.91. [1] 3. On 12 July 2021, Visvalingam filed a notice of motion in the District Court proceeding seeking – "1 An order pursuant to section 99 of the Civil Procedure Act 2005 that the Respondent pay the Plaintiff's costs of the proceedings." The "respondent" referred to in the notice of motion was Mr Gokani. 1. On 1 March 2022, an amended notice of motion was filed including the following additional order: "1A In addition, or in the alternative to prayer 1 above, an order pursuant to section 62 and Clause 5, Schedule 2 of the Legal Profession Uniform Law Application Act 2014 that the Respondent pay the Plaintiff's costs." 1. The motion was heard on 10 and 11 March 2022; written submissions were filed in late April 2022. A further hearing took place on 2 June 2022. Judgment on the motion was delivered on 26 July 2022, [2] the Court making the following order: "Anand Gokani, solicitor for the first defendant, pay the plaintiff's costs of the proceedings on an indemnity basis, including the costs of the motion, incurred on and from the date of the filing of the defence on 16 April 2018." Mr Gokani appealed, challenging that order. Jurisdiction of this Court 1. Mr Gokani filed a notice of appeal on 12 October 2022. Because the proceedings in the District Court were brought by way of an action for recovery of principal and interest under a loan agreement, and the costs orders were incidental to that matter, an appeal lay under s 127 of the District Court Act 1973 (NSW). 2. The respondent, which would have known the amount of the costs payable to it pursuant to the order, took no issue with the assertion that the amount in dispute exceeded the threshold of $100,000 in s 127(2)(c)(i) of the District Court Act 1973 (NSW). 3. Nor did any issue arise as to the requirement for leave under s 127(2)(b), which requires leave with respect to a judgment or order "as to costs only". As explained by Bell P in Muriniti v Mercia Financial Solutions Pty Ltd, [3] leave is not required with respect to a challenge to an order under s 99 of the Civil Procedure Act 2005 (NSW). Similarly, leave is not required with respect to an order under Sch 2, cl 5, of the Legal Profession Uniform Law Application Act 2014 (NSW) ("Application Act"). The then President, after considering authorities from both Australia and the UK which supported such a conclusion, stated: "26 … findings of the utmost seriousness with regard to the legal practitioner are a necessary prerequisite to the ordering of costs against the practitioner. True it is that there may be a discretion as to the extent of any award of costs … but, as the primary judge's costs judgment also illustrates, much more than the exercise of a discretion underpinned the orders from which Mr Muriniti appeals." 1. Accordingly, the appeal to this Court was properly brought as of right. Before turning to the substance of the appeal it is convenient to address a further preliminary issue. Further evidence on appeal 1. On 13 March 2023, the respondent filed a motion seeking leave to adduce further evidence. The evidence sought to be relied upon was an affidavit of its solicitor, Mr Chedid, dated 21 February 2023. There was no objection taken to the affidavit itself, but objection was taken to a bundle of documents exhibited to the affidavit which ran to 116 pages. So far as the affidavit itself was concerned, the relevant paragraphs appeared on a single page. It recorded that on 21 October 2021, Vitarag was placed into liquidation. It then recorded that on 12 July 2022, the respondent took steps to require Mr Gokani to deliver up all files and records of Vitarag. Mr Chedid's firm are now the solicitors acting for Vitarag, having been appointed by the liquidator. 2. The primary purpose of the lengthy material exhibited to the affidavit was to establish a fact which was known to the respondent at the time its application for costs against Mr Gokani was on foot in the District Court. According to the submissions in support of the application, the respondent's solicitors had, "by 16 May 2022" become the solicitors for the liquidator of Vitarag. The submissions further stated that "since May 2022" Vitarag had waived its privilege with respect to documents held by Mr Gokani for the purposes of the litigation between the two companies, although the liquidator had not seen the documents. There was a statement in the costs judgment, to the effect that there had been no waiver of privilege by Vitarag; the respondent submitted that one matter the documents established was that that statement was factually incorrect. The remainder of the documents were said to illustrate the attempts which the liquidator had taken to obtain the files from Mr Gokani in the period from May 2022. 3. There were three difficulties facing the respondent in pursuing its motion. First, although the Court has power to receive further evidence pursuant to s 75A(7) of the Supreme Court Act, it would be unusual to receive evidence of events which had occurred before the completion of the trial the subject of the appeal and known at that time to the party seeking to tender the evidence, but which had not been adduced at trial. Given that the respondent knew that Mr Gokani was declining to answer questions which might reveal privileged information, it is unclear why the fact of the waiver of privilege was not drawn to the judge's attention. There was no explanation for that omission. 4. Secondly, the further evidence demonstrated that the respondent still did not have the file, but the respondent did not assert that the hearing of the appeal should be delayed to allow it to obtain the file. [4] 5. Thirdly, the purpose of tendering the material was quite limited. Counsel for the respondent identified the sole point of the tender in the following terms: [5] "It's really to defeat a submission to the effect that one can only imagine the weighty material contained on the solicitor's file which the court below should have inferred exists and should have declined to make a personal costs order based on that inference." 1. In objecting to the tender, the appellant's counsel noted that YPOL Lawyers acted for Mr Gokani on the costs application. On 7 September 2021, some eight weeks after the motion for costs was filed, YPOL wrote to the then director of Vitarag, Mr David Murray, requesting his advice within 10 days as to whether Vitarag waived privilege over Mr Gokani's file. No reply was received. Mr Gokani's solicitor, Mr Selvakumaran, affirmed an affidavit on 21 October 2021 annexing the letter and recording the absence of a response. By the time the motion was heard on 10 and 11 March 2022, the liquidator had not waived privilege. The issue of waiver was raised on 11 March 2022. [6] Privilege had in fact been waived by the liquidator by the time the matter came back before the court on 2 June 2022 for further submissions as to whether Sch 2 of the Application Act was engaged. It was common ground that nothing further was said in relation to waiver of privilege on that occasion. 2. The issue to which this material went was Mr Gokani's reliance on a statement in Medcalf v Mardell, [7] in which, after referring to a statement of principle in Ridehalgh v Horsefield, [8] Lord Bingham of Cornhill suggested that the particular passage should be strengthened by emphasising two matters: [9] "First, in a situation in which the practitioner is of necessity precluded (in the absence of a waiver by the client) from giving his account of the instructions he received and the material before him at the time of settling the impugned document, the court must be very slow to conclude that a practitioner could have had no sufficient material. Speculation is one thing, the drawing of inferences sufficiently strong to support orders potentially very damaging to the practitioner concerned is another. … The second qualification is no less important. The court should not make an order against a practitioner precluded by legal professional privilege from advancing his full answer to the complaint made against him without satisfying itself that it is in all the circumstances fair to do so. This reflects the old rule, applicable in civil and criminal proceedings alike, that a party should not be condemned without an adequate opportunity to be heard. Even if the court were able properly to be sure that the practitioner could have no answer to the substantive complaint, it could not fairly make an order unless satisfied that nothing could be said to influence the exercise of its discretion. Only exceptionally could these exacting conditions be satisfied." 1. Accordingly, the purpose of the further evidence was to displace the very considerable constraint on reaching a finding adverse to the solicitor, by removing the assumption that privilege had not been waived. 2. At trial, the respondent had submitted that only very weak attempts had been made to obtain a waiver of privilege. As the trial judge appreciated, there was an issue as to the validity of that submission. In Ridehalgh, the Court of Appeal had taken a rather different view, stating: [10] "In the usual case where a waiver would not benefit their client they will be slow to advise the client to waive his privilege, and they may well feel bound to advise that the client should take independent advice before doing so. The client may be unwilling to do that, and may be unwilling to waive if he does." 1. Counsel for the appellant submitted that the question of whether or not client privilege had been waived "is not the most significant point on this appeal by a very considerable margin". [11] 2. Both counsel accepted that there would be no difficulty in the presentation of their submissions if the Court reserved on the motion: the Court took that step. The suspicion that nothing might ultimately turn on the motion turned out to be correct: no further reference was made by either party to what weight, if any, was to be given to the Medcalf principle. 3. In these circumstances, the appropriate course is to grant leave to the respondent to read the affidavit of Mr Chedid of 21 February 2023 but refuse leave to adduce the documents constituting the exhibit to that affidavit. Jurisdiction of District Court to award costs against a solicitor 1. As noted above, the original motion sought an order pursuant to s 99 of the Civil Procedure Act. That section relevantly provides: 99 Liability of legal practitioner for unnecessary costs (1) This section applies if it appears to the court that costs have been incurred— (a) by the serious neglect, serious incompetence or serious misconduct of a legal practitioner, or (b) improperly, or without reasonable cause, in circumstances for which a legal practitioner is responsible. (2) After giving the legal practitioner a reasonable opportunity to be heard, the court may do any one or more of the following— (a) it may, by order, disallow the whole or any part of the costs in the proceedings— … (ii) in the case of a solicitor, as between the solicitor and the client, (b) it may, by order, direct the legal practitioner— … (ii) in the case of a solicitor, to pay to the client the whole or any part of any costs that the client has been ordered to pay to any other person, whether or not the client has paid those costs, (c) it may, by order, direct the legal practitioner to indemnify any party (other than the client) against costs payable by that party. 1. This Court has held that subs (2)(c) permits an order that the solicitor indemnify the opposing party against costs payable by it to its solicitor. [12] 2. It was only some ten days before the hearing of the motion, and some eight months after the motion was initially filed, that the amendment, seeking an order under the Application Act, was made. Schedule 2 of the Application Act relevantly provides: Schedule 2 Costs in civil claims where no reasonable prospects of success 1 Application of Schedule (1) Schedule extends to appeals This Schedule extends to legal services in connection with proceedings in a court on appeal as well as a court at first instance. (2) Legal services provided by both barrister and solicitor If legal services in relation to a particular matter are provided by both a solicitor and a barrister instructed by the solicitor, any function imposed by this Schedule on a law practice in respect of the provision of the services is to be read as imposing the function on both the solicitor and barrister. 2 Law practice not to act unless there are reasonable prospects of success (1) A law practice must not provide legal services on a claim or defence of a claim for damages unless a legal practitioner associate responsible for the provision of the services concerned reasonably believes on the basis of provable facts and a reasonably arguable view of the law that the claim or the defence (as appropriate) has reasonable prospects of success. (2) A fact is provable only if the associate reasonably believes that the material then available to him or her provides a proper basis for alleging that fact. … (4) A claim has reasonable prospects of success if there are reasonable prospects of damages being recovered on the claim. A defence has reasonable prospects of success if there are reasonable prospects of the defence defeating the claim or leading to a reduction in the damages recovered on the claim. (5) Provision of legal services in contravention of this clause constitutes for the purposes of this Schedule the provision of legal services without reasonable prospects of success. … 4 Restrictions on commencing proceedings without reasonable prospects of success (1) The provision of legal services by a law practice without reasonable prospects of success does not constitute an offence but is capable of being unsatisfactory professional conduct or professional misconduct by a legal practitioner associate of the practice who is responsible for the provision of the service or by a principal of the practice. (2) A law practice cannot file court documentation on a claim or defence of a claim for damages unless a principal of the practice, or a legal practitioner associate responsible for the provision of the legal service concerned, certifies that there are reasonable grounds for believing on the basis of provable facts and a reasonably arguable view of the law that the claim or the defence (as appropriate) has reasonable prospects of success. … 5 Costs order against law practice acting without reasonable prospects of success (1) If it appears to a court in which proceedings are taken on a claim for damages that a law practice has provided legal services to a party without reasonable prospects of success, the court may of its own motion or on the application of any party to the proceedings make either or both of the following orders in respect of the practice or of a legal practitioner associate of the practice responsible for providing the services— (a) an order directing the practice or associate to repay to the party to whom the services were provided the whole or any part of the costs that the party has been ordered to pay to any other party, (b) an order directing the practice or associate to indemnify any party other than the party to whom the services were provided against the whole or any part of the costs payable by the party indemnified. … 1. An issue appears to have arisen after the initial hearing of the motion as to whether Sch 2 to the Application Act was engaged. The costs judgment appears to have been written initially on the basis that it was engaged. The last section of the judgment commenced with the following passage: "35 In the course of preparing the judgment, the significance of the phrase 'claim for damages' in cl 2 of Sch 2 of [the Application Act] became apparent, especially as it was not obvious that the proceedings, which principally concerned repayment of a loan, involved a claim for damages. The parties had made no submissions on this point. They were invited to make further submissions addressing whether Visvalingam's claim was a claim for damages or not, whether initially or otherwise, and the significance of that characterisation." 1. On the appeal, senior counsel for the appellant eschewed a challenge to the findings of the trial judge, in so far as they relied on Sch 2 of the Application Act. He submitted that he was obliged to take that stance, because the matter had been conceded below. However, that does not appear to be correct. After setting out Visvalingam's submissions that the claim pursuant to the loan agreement was a claim in damages, the judge observed: "37 Mr Gokani submitted that a claim in debt is not for recovery of damages, the latter requiring an award of money for a civil wrong, whereas a claim in debt is based not on a wrong, but on the promise to pay. The submission rested on the proposition that the Amended Statement of Claim did not claim damages or plead a breach of contract, and cl 5 of Sch 2 should not be read as including a claim in debt, even if a claim in debt might also be pleaded as a breach of contract." 1. The judge was, in any event, satisfied that "an action in debt is not within the ordinary meaning of an action in damages": at [40]. He was not persuaded that the proper construction of cl 2, being limited to "a claim for damages", should be given a "wider meaning, especially since cl 2 generally operates to remove a common law right to retain legal representation to maintain or defend proceedings". That reasoning should be accepted and applied to the same phrase, "claim for damages" used in cl 5. 2. However, the trial judge then went on to consider whether the present case was a claim for damages. That question, he concluded, should be answered by reference to "the pleading rather than the circumstances giving rise to the claim". The next step, however, added a level of sophistication to the inquiry. Although the relief claimed on the original statement of claim was an order for payment of money, the judge noted that the calculation of the claim (namely identification of the loan amount and the calculation of interest thereon), appeared under a heading "[l]oss and damage". On that basis, he concluded that the original claim was "a claim for damages": at [46]. There were two problems with this conclusion, one of which the judge noted. That was that the amended statement of claim, on which the matter went to trial, was a claim for "debts owed to the plaintiff", and the reference to "loss and damage" was deleted. The judge recognised that the subsequent pleading and the basis of the claim at trial "was not one in damages". 3. There had been, however, no change to the substance of the claim. It had always been and remained a claim in debt. The use of a heading "loss and damage" did not demonstrate that the cause of action was a claim "for damages". The words "loss" and "damage" refer to the detriment suffered by the plaintiff: the word "damages" refers to the relief which may be obtained. The plaintiff never sought damages. There was no tenable basis for Visvalingam to rely on Sch 2, cl 5 of the Application Act. 4. In some cases, this would be a matter of some importance. Aspects of Sch 2, as the judge recognised, go beyond general law principles established in cases such as Myers v Elman, [13] and beyond the statutory basis for an order for costs against a legal practitioner in s 99 of the Civil Procedure Act. For present purposes, it is sufficient to conclude that the respondent's claim should not have succeeded under either provision. Filing of defence to original statement of claim Background circumstances 1. Before identifying the relevant issues arising from the filing of a defence to the original statement of claim it is necessary to set out some brief facts. It is also necessary to be cautious in undertaking that exercise. A critical aspect of the claim that Mr Gokani acted improperly in filing a defence turned on his state of knowledge at that time. In addressing that question the trial judge had to put to one side his own knowledge based on evidence that had been presented in the course of the trial, his impressions as to witnesses and findings of fact made in the substantive judgment on liability. 2. With that in mind it is appropriate to identify one fact and the dramatis personae. The fact is that in September 2008 a sum of $94,000 was paid by way of loan by a couple in Australia for the benefit of a businessman in the USA. 3. The beneficiary was Nanubhai Chitubhai Patel (Mr Patel Snr) who in 2008 lived in California and was the principal of a company, Rockhard Transportation Inc, which transported rock and building materials. In 2008 he was seeking funds to maintain the operations of the company. In that exercise he enlisted the help of his son, Ashish Nanubhai Patel (Ashish Patel) who worked in investment banking and lived in Sydney. The loan the subject of the proceedings was paid into a bank account in the name of the Kailash Trust, of which the defendant in the District Court, Vitarag Pty Ltd, was the trustee. 4. The money was obtained through the agency of Ashish Patel from the parents of Selva Nithan Thirunavukarasu, who was referred to in the proceedings by all participants as "Nithan". His parents, Savthri and Selvavinayagam Thirunavukarasu, controlled a self-managed superannuation fund known as Savi3 Superannuation Fund established in June 2008. At one stage they were the trustees of Savi3. Later, the plaintiff in the District Court, Visvalingam Pty Ltd, was the trustee of that fund. The loan was obtained from that fund. A defence to a deficient pleading 1. For reasons which will be noted shortly, the original statement of claim was deficient in matters of substance and not merely of form. As counsel for the appellant submitted, if a solicitor were to be at risk of bearing responsibility for the whole costs of a trial in the event that a defence was filed, without reasonable cause, to a deficient claim, that must also be the case even if the plaintiff at trial were to be unsuccessful. Such an outcome suggests that the underlying reasoning of the trial judge was fundamentally flawed. It is convenient to turn immediately to why that is so. 2. That the trial judge adopted that reasoning appears from a passage which conceded the possibility, against the finding in the liability judgment, that affidavits filed by the plaintiff provided a proper basis for alleging that Vitarag was not the borrower. The judge continued: "34 … Had Mr Gokani not acted in the filing of the defence, there would have been no filing of affidavits. In a real and common-sense way, the costs of the proceedings arose from Mr Gokani acting in the filing of the defence and thereafter. In the result, costs were incurred by that conduct of Mr Gokani, including the whole costs of the proceedings. There is no basis to conclude that the proceedings would have continued without Mr Gokani acting, nor did Mr Gokani submit that they would." 1. The order required that Mr Gokani pay the plaintiff's costs on an indemnity basis on and from the date of the filing of the defence to the original statement of claim on 16 April 2018. 2. It is necessary to deal with the findings in relation to Mr Gokani on an alternative basis adopted by the trial judge. The judge found not merely that the defence was filed "without reasonable cause" but also that Mr Gokani had no subjective belief in the existence of reasonable cause. Thus, the judge referred to the certification on the defence as not having been pressed by Mr Gokani "as evidence of his belief, or of the reasonableness of any belief": at [15]. The judge noted that Mr Gokani "gave no evidence of his belief at the time of filing the defence, and why he so believed (if he so believed) that Vitarag was not the borrower or could not be shown to be the borrower": at [18]. The judge further stated that there was no evidence "from Mr Gokani that he believed, or had reason to believe, that Ashish or Nanu was the borrower at the time of filing the defence": at [17]. 3. It is possible that the absence of a subjectively held belief was not central to the judge's reasoning, but the respondent did not rely on that possibility. Rather, it submitted that the statement of the dispositive issue identified by the judge as "whether Mr Gokani acted without reasonable prospects of success, that is, whether he lacked a reasonable belief" [14] was a question which was concerned with "the reasonable belief as subjectively held by the solicitor". [15] 4. The respondent relied on two authorities to support that understanding, both of which concerned predecessors to Sch 2 of the Application Act, dealing with claims for damages. Each of them referred to the provision being "concerned with the reasonable belief as subjectively held by the practitioner": see Keddie v Stacks/Goudkamp Pty Ltd ("Keddie"). [16] 5. There are a number of problems with relying upon this line of authority. First, the cases dealt with claims for damages and hence no issue arose as to the engagement of the earlier provisions equivalent to Sch 2 of the Application Act. Secondly, s 348(1) of the Legal Profession Act 2004 (NSW), being the provision addressed in Keddie, stated: "[i]f it appears to a court in which proceedings are taken on a claim for damages that a law practice has provided legal services to a party without reasonable prospects of success" the court may make orders with respect to payment of costs. It is true that a separate provision (s 345) prohibited a law practice from providing legal services on a claim or defence of a claim for damages "unless a legal practitioner … reasonably believes … that the claim or the defence … has reasonable prospects of success". It is not necessary for present purposes to consider whether the reference to reasonable belief contained in the prohibition was properly imported into the separate section with respect to orders for costs, which made no reference to the belief of the solicitor, but merely adopted (similarly to s 99 of the Civil Procedure Act) the criterion of the provision of legal services "without reasonable prospects of success". The principle of statutory construction which would import such an additional criterion into s 99 was not explored. The better view is that s 99 contains no such element. 6. Secondly, the term "subjective", in relation to a belief, has no simple application. As the appellant submitted, the complexity of attributing knowledge or belief as to a fact has been explored by this Court in other contexts, including with respect to the operation of ss 50C and 50D of the Limitation Act 1969 (NSW), in Murgolo v AAI Ltd t/as AAMI. [17] 7. In the present circumstances, the relevant factor must be a belief in a fact, rather than the fact itself. It is no part of a legal practitioner's role in litigation to form concluded views as to the existence of facts or the outcome of proceedings. The terminology in Sch 2 of the Application Act invokes a standard of "reasonable prospects of success". 8. Secondly, as Leeming JA explained in Murgolo, the holding of an opinion or belief (in the case of a tribunal of fact) may involve feeling an "actual persuasion" but that "an opinion that a state of facts exists may be held according to indefinite gradations of certainty". [18] 9. Thirdly, even in the context of Sch 2 of the Application Act, which deals both with claims and defences, there is an important distinction between a belief as to a fact, the proof of which falls to the practitioner's client, [19] and a belief as to a fact the proof of which is imposed on the other party. In the present case, all that the original defence did was to deny that Vitarag was liable for repayment of the loan. Establishing that it was a party to the loan was an essential element of the plaintiff's case. When the statement of claim was served, Mr Gokani had no necessary knowledge of any evidential basis for the plaintiff's claim. The original pleading read as follows: "Contract 5 On or around 23 August 2008, the plaintiff and defendant made a contract whereby, in consideration of the plaintiff advancing to the defendant AUD$94,000 (Principal Amount), the defendant would repay the plaintiff after 30 days (Term) the Principal Amount plus simple interest calculated at a rate of 6% per annum (Contract). Particulars Orally between the plaintiff and the defendant 6 On or around 23 September 2008, the plaintiff and defendant agreed to vary the Term of the Contract such that, instead of 30 days, the defendant would repay the plaintiff within 5 years (Extended Term) the Principal Amount plus simple interest calculated at a rate of 6% per annum (Contract). Particulars Orally between the plaintiff and the defendant" 1. The defence denied pars 5 and 6 of the statement of claim and further denied that the defendant was "indebted to the plaintiff in the amount claimed in paragraph 13 of the statement of claim or at all". 2. The defence was verified by an affidavit of Ashish Patel dated 15 April 2018. Mr Patel stated that he was a director and principal shareholder of the defendant. The affidavit was in standard form but asserted that "allegations of fact that are denied in the defence are untrue". 3. In dealing with the filing of the defence, the trial judge referred to an absence of evidence as to Mr Gokani's belief at the time he filed the defence. Referring to Mr Patel as "Ashish" and his father, who was the principal beneficiary of the loan as "Nanu", the judge stated: "17 In these circumstances, there was no evidence, either at trial or on this application, from Ashish or Nanu to support the assertion that one was or both of them were the borrower. Nor was there any evidence from Mr Gokani that he believed, or had reason to believe, that Ashish or Nanu was the borrower at the time of filing the defence or that he could in any other way resist the evidence, including the four Letters of Confirmation, that Vitarag was the borrower. He identified no conversation and no document that gave or could have given him a belief of reasonable prospects." 1. There are several difficulties with this reasoning. First, the letters of confirmation were referred to in par 8 of the statement of claim as post-contractual conduct. There was no evidence that Mr Gokani had access to those letters at the time the defence was filed. However, although the trial judge placed much weight upon those letters in his judgment on liability, an experienced legal practitioner need not have assumed that post-contractual unilateral conduct by one party, allegedly some four years after the contract was entered into, would be dispositive. 2. Secondly, the defence did not plead that someone else was the borrower; it merely denied that Vitarag was liable to the plaintiff. There was no obligation at the time Mr Gokani filed the defence for him to form any view as to facts which were not alleged, nor, it might be added, did Mr Patel's affidavit of verification advert to, or need to advert to, such facts. 3. Thirdly, in so far as it was stated that there was no evidence either at trial or on the application from Ashish or Nanu to support the assertion that one was or both of them were the borrower, that was erroneous in a number of respects. First, as the judge noted at [27], the plaintiff relied upon an affidavit of Selva Nithan Thirunavukarasu, sworn on 26 November 2019 (albeit more than a year after the defence was filed) which gave extensive evidence of conversations between himself and Mr Patel. The affidavit was replete with references to statements to Mr Thirunavukarasu by Mr Patel suggesting personal liability. Those statements included, "my Dad and I will borrow the money and secure it against the property and pay your Mum a really healthy interest rate, like 10-12%". [20] The judge also noted that Mr Patel Snr in fact gave evidence pursuant to which he did not accept any responsibility for the loan. 4. It is apparent that the reasoning in the costs judgment paid insufficient attention to the precise question being addressed, namely the state of knowledge of Mr Gokani as at 16 April 2018. Further, it relied on findings with respect to disputed evidence which had been made in the course of the trial and the liability judgment. If subsequent evidence were to be relied on, it included the plaintiff's concession (discussed below) that it was not a party to any contract in 2008. 5. Fourthly, when the judge returned to the correct temporal issue, he said that "Mr Gokani gave no evidence of his belief at the time of filing the defence": at [18]. After hesitating as to whether to draw a Jones v Dunkel inference against him, the judge continued: "Even without such an inference, I would not draw in his favour an inference of a belief of reasonable prospects, as he was the witness that could have given evidence of that matter but failed to do so." 1. This passage does not merely reverse the onus of proof, but fails to acknowledge that a finding that a solicitor took a step in litigation without a belief as to reasonable prospects of success was an extremely serious finding. If a client verifies a pleading on oath or by affirmation there must ordinarily be evidence which both demonstrates why the affidavit was false and why the solicitor knew or ought reasonably to have known that to be the case. 2. An applicant seeking to saddle the solicitor acting for a party with responsibility for the costs of litigation will encounter a number of practical difficulties. One is that the solicitor may well not be able to give a full account of his or her conduct, because the client is not prepared to, or simply fails to, waive privilege. There was no evidence before the trial judge that privilege had been waived. As explained above, when Mr Gokani's solicitor gave evidence he was cross-examined about steps he had taken to obtain a waiver. [21] In fact privilege had not then been waived and there was no later request to recall him, nor to prove waiver by the liquidator. 3. Further, it should not be accepted that simply by making a claim for costs against a solicitor, a burden of proof is placed upon the solicitor to deny misconduct. For the reasons already given, the nature of the defence itself, which was entirely negative, provided no basis for an inference that the solicitor held any particular belief as to the nature of the evidence available to the plaintiff or to his client or as to the ultimate prospects of success. Nor did he need to form such a belief. He had available to him instructions from the director of the defendant denying liability for the loan. Unsurprisingly, there was no challenge to the defence at the time it was filed. There was never any application to strike the defence out, nor was there any evidence that such an application would have had any prospect of success. 4. For these separate reasons, the findings with respect to the defence filed to the original statement of claim did not warrant an order for costs against Mr Gokani. No absence of reasonable cause 1. There is a further reason why no such order should have been made. While later events should not be used to burden a solicitor with knowledge that he did not have at the time he filed the defence, subsequent events which demonstrate that the defence was entirely warranted and the statement of claim was deficient should be available to resist a claim against the solicitor. In part that follows from the fact that both s 99 of the Civil Procedure Act, and indeed cl 5 of Sch 2 to the Application Act, rely upon an objective test of the step having been taken "without reasonable cause". In the present case, whatever Mr Gokani may or may not have believed, the original statement of claim was patently deficient. The circumstances in which that was revealed in the course of the litigation should be identified. 2. On 6 June 2018, less than two months after the defence was filed, the defendant filed a notice of motion seeking security for costs. The matter came before Judge Russell SC on 6 July 2018; at least that was the day on which the judge handed down reasons. Judge Russell noted (at p 2): "The evidence put on by the defendant comes from two affidavits of [Mr Gokani], who is the solicitor for the defendant. He has for some time been asking the plaintiff to produce documentation to establish that if a costs order was made against the plaintiff it could be paid. In spite of numerous requests for that information nothing was provided until this morning when an affidavit was put on for the plaintiff. [Mr Gokani], who is a solicitor of some experience, has the view that on a final hearing this case would run for two days and, in his view, the likely amount of assessed costs which would be recovered by the defendant would be somewhere between 65 and 70 thousand dollars." 1. Noting that the loan upon which the plaintiff sued was an oral agreement, the judge considered that estimate to be more realistic than the shorter estimate by the plaintiff's solicitor. The judge continued: "I acknowledge that there are some short, fairly directly worded, documents which seem to acknowledge the existence of the loan but the statement of claim gives no particulars of how the oral agreement arose in the first place. In such a case there is always room for disputation." The judge ordered that security be provided in an amount of $50,000 and declined to order that it be paid in tranches. 1. As had been foreshadowed before Russell DCJ, the plaintiff filed an amended statement of claim. However, that did not take place until more than a year after the security was ordered, namely on 1 August 2019. The loan agreement was varied in significant respects and significant detail was added. In substance, the oral agreement was said to have been reached in "conversations between Selva Nithan Thirunavukarasu and Ashish Patel". The loan was now said to have been made by Nithan's parents as trustees for the Savi3 Fund and Vitarag as trustee for the Kailash Trust, and not pursuant to a contract with the plaintiff. 2. Mr Ashish Patel was added as a second defendant. It was alleged that Mr Patel agreed to guarantee the payment by Vitarag of amounts that became due under the contract, identified as the "First Contract". There was then an express pleading (for the first time) that the money was advanced, on or around 12 September 2008. It was said to have been advanced to the first defendant, Vitarag. The original period of the loan was identified as 90 days, rather than 30 days as pleaded in the original statement of claim. Interest was to be calculated at 10% per annum, rather than the rate of 6% per annum pleaded in the original statement of claim. The extension of the repayment date from 30 days to "within five years", which was asserted in the original statement of claim to have occurred on or around 23 August 2008 was repleaded as "the date five years after 12 September 2008", the variation being made by a "Second Contract" entered into on or around 28 June 2012. That agreement was said to be partly oral and partly in writing. The oral arrangement was said to have been made "in conversations" between Nithan and Ashish Patel; the written element was said to be "contained recorded" in a letter of confirmation signed by Mr Patel and emailed by him to Nithan on or around 28 June 2012. A further guarantee by Mr Patel was alleged, either based on oral arrangements with Nithan or an implied agreement based on the creation of the Second Contract. 3. These variations completely recast the factual substratum of the plaintiff's case. The involvement of the plaintiff itself was also recast. 4. Mr and Mrs Thirunavukarasu retired as trustees of the Savi3 Fund upon the appointment of the plaintiff, which was now said to have occurred on or about 1 February 2018, that is almost ten years after the original loan agreement. The involvement of the plaintiff, it was now pleaded, resulted from an assignment of the interests of the retiring trustees to the plaintiff by a deed dated 1 March 2019, that is, 13 months after the filing of the original statement of claim and months after the hearing before Russell DCJ. Notice in writing of the assignment was said to have been given to the defendants on or around 9 April 2019 or, alternatively, on or around 20 or 21 June 2019. 5. These changes in the pleadings were not insignificant: the plaintiff was not said to have had any interest in the loan agreement until after the filing of the original statement of claim. The pleading that repayment was guaranteed by Mr Patel found no reflection in the original statement of claim. The interest rate was varied, and the extension of time occurred some four years after it had originally been pleaded to have occurred. 6. It followed that, if the amended statement of claim were assumed to be correct, the defendant had reasonable cause to deny every allegation in the original statement of claim. The amount of the principal did not change, but all the other details, including as to the identity of the parties, did change. It follows that, on the plaintiff's own case, there could be no challenge to the filing of the defence to the original statement of claim. Subsequent events Defence to amended statement of claim 1. For the reasons set out above, the order made by the trial judge on 26 July 2022 requiring payment of costs from the date of filing the defence to the original statement of claim must be set aside. There was no notice of contention seeking to support an order effective from a later date. 2. The judge, however, did consider certain events which arose after the filing of the amended statement of claim. First, prior to the filing of the amended statement of claim, both Ashish Patel and his father (who until 14 May 2018 were the only two directors of Vitarag) had resigned, Mr Patel Snr on 14 May 2018 and Ashish Patel on 15 April 2019. [22] Ashish Patel remained the sole shareholder of Vitarag. However, Mr Gokani advised the plaintiff's solicitors that he had last been instructed by Ashish Patel on 10 April 2019, several months before the amended statement of claim was filed. After Ashish Patel retired as a director, his place was taken by David Murray, who verified the defence to the amended statement of claim, which was filed on 23 August 2019. 3. The points of claim filed by the plaintiff in support of its application for a costs order against Mr Gokani did not identify the filing of the second defence as a basis for the costs order. Although the points of claim proffered three dates from which costs might be assessed none was 23 August 2019. The submissions of the respondent in this Court did not seek to support an order on that basis. Case run at trial 1. In a passage in the costs judgment at [21]-[34] the judge dealt with the case run by Vitarag at trial which relied significantly on evidence given by Nithan (for the plaintiff) as to conversations he had with Ashish Patel in arranging the loan. The judge stated: "21 … Vitarag relied on the accounts of conversations given by Nithan, in his affidavit read by Visvalingam, and the contents of emails annexed to that affidavit, and the cross-examination of Nithan on these matters, to argue that the identity of the borrower was not proved to be Vitarag." 1. The judge noted that none of those matters were known to Mr Gokani before the service of Nithan's affidavit, which was dated 26 November 2019; or, as the judge further observed, "at least there was no evidence of it": at [22]. 2. Noting that Ashish Patel did not give evidence and that his father did not suggest he was the borrower personally, the judge expressed "a judicial reluctance in drawing inferences in their favour", apparently meaning in favour of Mr Gokani and counsel briefed by him. The judge then concluded that from the date of the filing of the defence to the original statement of claim, up until the service of Nithan's affidavit, he found "no basis to conclude that there was any belief, let alone a reasonable belief based on provable facts, of an alternative borrower to Vitarag": at [24]. 3. It is not clear that anything turned on that reasoning. In subsequent paragraphs, the judge repeated findings made in the liability judgment to the effect that Nithan's evidence that Ashish had referred to "my Dad and I will borrow the money" was a colloquial statement which "could not reasonably supplant" the formal letter of confirmation, "because of the substantial lapse of time since the conversation, and because Ashish was out of contact, giving no instructions or evidence for Vitarag". 4. To the extent that this material was relevant, it was relevant to Mr Gokani's basis for pursuing the defence to the proceedings through the trial. As counsel for Mr Gokani submitted, there was a volume of material in evidence at the trial upon which a commercial litigator could have formed the belief that a defence had reasonable prospects of success (if that were the relevant test) and which would provide reasonable cause to defend the proceedings. First, the affidavit gave accounts of the conversations from which could be inferred an oral agreement by way of loan. That was the agreement particularised as resulting from conversations between Nithan and Ashish Patel. Those conversations gave rise to real doubt as to the identity of the borrower. For the most part, they did not identify Vitarag as the borrower. The inference that the money was a loan to Vitarag derived principally from the objective circumstance that Mr Patel sought to have the money transferred to the bank account of the Kailash Trust of which Vitarag was the trustee. The destination of a loan payment, on instructions from a borrower, is a common event, which may, but often does not, reveal the identity of the borrower. 5. The first letter of confirmation relied upon in the pleading, and given significant weight by the trial judge, might reasonably have been relied on by the plaintiff as an admission against interest. It was in fact created more than a year after the due date on the oral contract which, as identified in a letter of demand of 27 September 2017 from the solicitors for the plaintiff, was 22 August 2013 (being five years after the money was provided on 23 August 2008). Further, it did not accord with the pleaded term of the agreement relied on in the amended statement of claim, which asserted that interest was to run at 10% per annum; the letter of confirmation stated that interest was payable at 6% per annum. 6. To the extent that post-contractual conduct was admissible and, in the judge's words, "of force equivalent to a signed loan agreement" [23] a solicitor in Mr Gokani's position might reasonably have believed that weight would be given to an email on 27 June 2012 from Nithan to Ashish Patel referring to "the 94k that was loaned to your Dad" and the further email on 15 June 2017 referring to "money lent to you and your father in 2008". 7. The solicitor in Mr Gokani's shoes might not have anticipated that the judge would find that "the value of these conversations is limited, because a colloquial reference to the borrower being Ashish, his father, or both, could not reasonably supplant the formal 'Letter[s] of Confirmation'". Furthermore, the statement that Mr Patel Snr did not give evidence that he was the borrower was, as noted above, also incorrect. When Mr Patel's business Rockhard Transportation was in need of funds to maintain its operations, [24] Mr Patel Snr sought assistance from his son Ashish in Australia. He stated that Ashish organised around twelve loans "to me" from various parties. [25] He recalled borrowing a total of US$2.5M from around forty different parties, including the loans organised by Ashish. [26] 8. Mr Patel Snr referred to a paragraph in Nithan's affidavit in which Ashish Patel was said to have told Nithan: "My Dad and I will borrow the money and we'll secure it against the property and pay your Mum a really healthy interest rate, like 10-12%." 1. In response to what was said in that paragraph, Mr Patel Snr stated: [27] "Further, the only borrowings which I asked Ashish to seek out for me personally were, as described earlier, to fund Rockhard." 1. The judge may not have accepted that evidence of Mr Patel Snr, but it was evidence which permitted the solicitor for Vitarag to defend the proceedings. Briefing of counsel 1. Mr Gokani briefed Mr Newton of counsel to appear for Vitarag at the trial. Evidence was presented at the hearing of the costs application to demonstrate that Mr Newton was an experienced commercial barrister. The judge did not find otherwise. However, he gave no weight to that fact in relying on the absence of evidence from Mr Newton. 2. With respect, that approach is not tenable. A solicitor may not necessarily escape liability for the improper pursuit of litigation by briefing counsel; however, where counsel is briefed and runs the trial, the appropriate inference is that he did not accept the brief in the belief that the case was hopeless. For reasons already explained, the defendant's case was not hopeless. In those circumstances, the appropriate inference was that Mr Gokani obtained and acted upon Mr Newton's advice that the matter could properly run. Mr Selvakumaran's affidavit filed for Mr Gokani on the costs application, demonstrated that Mr Newton was counsel briefed by Mr Gokani for Vitarag who appeared at a pretrial conference before the Judicial Registrar in the District Court on 30 May 2018 (six weeks after the defence was filed), and who appeared before Russell DCJ on the security for costs application. The inference is that at all relevant stages, Mr Gokani briefed counsel and that counsel saw no basis to refuse to act. The point may not have been dispositive of the case, but the trial judge gave insufficient weight to that circumstance; indeed, he did not refer to that evidence. Conclusion 1. Two further observations may be made in relation to this proceeding. First, circumstances where the costs of recovery of a loan through litigation are likely to approach, or even exceed, the amount at stake, without having regard to the vicissitudes of litigation and the likelihood of success or failure, present in sharp focus the importance of practitioners (and clients) having regard to the overriding purpose identified in Pt 6 of the Civil Procedure Act and the duty to further the overriding purpose in the conduct of the proceedings. The court is required to implement its practices and procedures so as to resolve issues between the parties in such a way that the cost is proportionate to the importance and complexity of the subject matter in dispute: Civil Procedure Act, s 60. The "importance" of this case was reflected in the amount of the claim. 2. The attempt to recover costs from the solicitor for the defendant was an example of what has been described as adjectival or "satellite" litigation, [28] the principal claim having been disposed of. The jurisdiction invoked derives from the supervisory jurisdiction of the court with respect to its officers (legal practitioners) who fail to discharge their duties to aid in promoting the cause of justice, as explained by Lord Wright in Myers v Elman [29] in 1940. 3. It is true that, over the decades since 1940, the courts, and disciplinary agencies within the profession, have greatly expanded the regulation of professional conduct. However, the purpose of such regulation is subverted at a point when practitioners are discouraged from pursuing their client's interests in litigation, where there are grounds to do so. As Barrett J explained in Degiorgio, it is not appropriate to entertain fine arguments as to the scope by which legal principles are contestable, nor to assess by hindsight the reasonableness of a particular claim or defence. In relation to the filing of a defence, Lord Reid stated in Myers v Elman, supporting the finding of the trial judge, Singleton J: [30] "A client is entitled to have legal aid in order to put the other side to proof of the case against him, and to test and probe that case and the evidence adduced. Thus the client is entitled to say that he denies the fraud or other matters charged and to have that defence placed on the record. He is entitled to have professional aid in regard to the maintenance of that defence before and at the trial and to plead matters in mitigation and in regard to questions of damage." 1. On this appeal the Court was taken to no authority in which a solicitor acting for a defendant had been subjected to an adverse costs order for filing a defence the sole purpose of which had been to put the claimant to proof of its case. 2. Finally, it is important that where such cases are brought, careful attention be given to the provision under which the application is brought. Had it been necessary to consider the precise operation of cl 5 of Sch 2 to the Application Act, it would have been important to identify the differences in approach which should be adopted as between a complaint about a claim for damages brought without reasonable prospects of success, and the defence to such a claim. For example, there is an issue as to whether the need for a solicitor to rely upon "provable facts" has a significant operation in cases where the client bears no onus of proof. 3. For the reasons set out above, the appeal must be upheld and the judgment and orders below set aside. The notice of appeal sought that the respondent's notice of motion in the District Court be dismissed with costs and that the respondent pay the costs of the appellant in this Court. Such orders are appropriate in the case of the appellant's success and in the absence of any submission that costs should not follow the event. 4. Accordingly, the Court should make the following orders: 1. Allow the appeal and set aside the orders made in the District Court on 26 July 2022. 2. In place of those orders, order that: 1. Visvalingam's amended notice of motion filed on 1 March 2022 be dismissed; 2. Visvalingam pay Mr Gokani's costs of the motion in the District Court. 1. Order that Visvalingam pay Mr Gokani's costs of the appeal. 1. GRIFFITHS AJA: I agree with Basten AJA. ********** Endnotes 1. Visvalingam Pty Ltd v Vitarag Pty Ltd [2021] NSWDC 364 ("liability judgment"). 2. Visvalingam Pty Ltd v Vitarag Pty Ltd (No 2) [2022] NSWDC 294 ("costs judgment"). 3. [2021] NSWCA 180 at [25] (Bell P, Gleeson JA and Emmett AJA agreeing). 4. CA Tcpt, 03/04/23, p 2(5). 5. CA Tcpt, p 4(11). 6. DC Tcpt, 11/03/22, pp 23(40)-24(20). 7. [2003] 1 AC 120; [2002] UKHL 27. 8. [1994] Ch 205 (EWCA). 9. Medcalf at [23], pp 135-136. 10. Ridehalgh at 237. 11. CA Tcpt, p 6(2). 12. King v Muriniti (2018) 97 NSWLR 991; [2018] NSWCA 98 at [9]. 13. [1940] AC 282. 14. Costs judgment at [8]. 15. Respondent's written submissions at [26]. 16. [2012] NSWCA 254; 293 ALR 764 at [58] (Beazley JA, referring to the judgment of Barrett J in Degiorgio v Dunn (No 2) (2005) 62 NSWLR 284; [2005] NSWSC 3 at [17]). 17. (2019) 101 NSWLR 376; [2019] NSWCA 295 at [39]-[44], [96], [107]. 18. Murgolo at [107] referring to the reasoning of Dixon J in Briginshaw v Briginshaw (1938) 60 CLR 336 at 361; [1938] HCA 34. 19. See Sch 2, cl 2(2), referring to a belief in facts which that party alleges. 20. Affidavit par 15. 21. DC Tcpt, 10/03/22, pp 8-9. 22. See plaintiff's points of claim in support of the costs motion, pars 6-8. 23. Costs judgment at [33]. 24. Affidavit, 28 February 2020, par 9. 25. Affidavit, par 12. 26. Ibid. 27. Affidavit, par 28. 28. Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Ltd (2013) 250 CLR 303; [2013] HCA 46 at [59]. 29. Myers at 317-318. 30. Myers at 316. Amendments 26 April 2023 - Changes to [7] and [8] to refer to s 127 of the District Court Act. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 27 April 2023