Supreme Court New South Wales Medium Neutral Citation: Calokerinos, Executor of the Estate of the late George Sclavos v Aantcorp Pty Ltd (No 2) [2023] NSWSC 433 Hearing dates: On the papers Date of orders: 28 April 2023 Decision date: 28 April 2023 Jurisdiction: Equity Before: Robb J Decision: See [18] Catchwords: JUDGMENTS AND ORDERS — orders giving effect to reasons for judgment Cases Cited: Calokerinos, Executor of the Estate of the late George Sclavos v Yesilhat; Yesilhat v Calokerinos, Executor of the Estate of the late George Sclavos (No. 4) [2020] NSWSC 1044 Calokerinos, Executor of the Estate of the late George Sclavos v Aantcorp Pty Ltd [2023] NSWSC 148 Category: Consequential orders Parties: Cleopatra Sclavos Calokerinos, Executor of the estate of the late George Sclavos (plaintiff) Aantcorp Pty Ltd ACN 163 257 869 (first defendant) Nam Thanh Nguyen (second defendant) Okan Yesilhat (third defendant) Gokan Yesilhat (fourth defendant) Australia's Best Tyre & Auto Pty Ltd ACN 151 629 131 (fifth defendant) Representation: Counsel: M Evans (plaintiff) A Kaylinger (first and second defendant) D Allen (fourth defendant) Solicitors: ELG Legal (plaintiff) Cook Solicitors (first and second defendant) S&R Lawyers (fourth defendant) File Number(s): 2017/00317671 Publication restriction: Nil JUDGMENT 1. The Court published its primary judgment in respect of the issues that remained for determination by the Court on 27 February 2023: Calokerinos, Executor of the Estate of the late George Sclavos v Aantcorp Pty Ltd [2023] NSWSC 148 ("J"). 2. The Court's orders for costs made in the primary judgment left open a question concerning what I described in order 3 as "the relevant proportion" of the fourth defendant, Gokan Yesilhat's, costs. Relevantly, orders 3 and 4 were as follows: (3) Subject to orders 4 and 5, makes a costs order against the plaintiff in favour of the fourth defendant to pay the relevant portion of his costs of the proceedings as follows: (a) there be no order for costs for the period from the commencement of the proceedings up to 22 May 2019 with the intent that the parties will bear their own costs for that period. (b) the plaintiff shall pay the fourth defendant's costs between 22 May 2019 and 11 August 2020 on the ordinary basis. (c) the plaintiff shall pay the fourth defendant's costs for the period after 11 August 2020 on the indemnity basis. (4) For the purposes of order 3, the relevant portion shall be determined following the provision by the plaintiff and the fourth defendant of submissions as required by par 92 of the reasons for judgment to determine the proportion of the costs incurred jointly by the third, fourth and fifth defendants that should be paid by the plaintiff to the fourth defendant. 1. The reasons for the reference to "the relevant portion" in orders 3 and 4 will be found in J [90]-[92], which I will now repeat for convenience: [90] The formulation of the order for costs that should be made in favour of Gokan Yesilhat against Ms Calokerinos in respect of the cost of the proceedings generally should take into account what I understand to be the case that Okan and Gokan Yesilhat and ABT had common legal representation until the appointment of a liquidator of ABT on 29 October 2020 and the declaration of Okan Yesilhat's bankruptcy on 7 June 2021. For convenience, I will set out again order 3 made by Slattery J in Judgment (No 4) concerning the costs payable by Ms Calokerinos to Gokan Yesilhat in the primary proceedings: "(3) Order that the plaintiff pay Mr Gokan Yesilhat's costs of the debt/trust proceedings, which shall be assessed on the ordinary basis and on the basis that he shall receive (a) the costs attributable to his defence which are 7.5% of the common costs incurred by all the defendants in the proceedings, together with (b) any specific expenses referable solely to his participation in the proceedings, being for example expenses related to the preparation of his affidavits." [91] As Okan Yesilhat plainly was the principal defendant in these proceedings, it would be unjust for the Court to ignore the involvement of Okan Yesilhat and ABT (both of whom were found by Slattery J to be liable to Ms Calokerinos) and to simply make an order that would oblige Ms Calokerinos to pay all of the costs incurred by Gokan Yesilhat when he was jointly liable for the costs with the principal defendants. [92] As the parties have not made submissions concerning the proper wording of the costs order, I will give Ms Calokerinos and Gokan Yesilhat the opportunity to do so. Ms Calokerinos should deliver written submissions to my Associate (limited to three pages) within seven days of the publication of these reasons for judgment and Gokan Yesilhat should respond (also limited to three pages) within a further seven days. 1. The structure of order 3 made in the primary judgment is that it requires Ms Calokerinos to pay to Gokan Yesilhat the relevant proportion of his costs. As no order for costs was made for the period up to 22 May 2019, the relevant portion will have no operation for that period. It will only operate for the period referred to in sub-orders (b) and (c), in respect of which Ms Calokerinos was ordered to pay Gokan Yesilhat's costs on the ordinary and indemnity bases respectively. 2. I formulated order 3 in terms of "the relevant proportion of his costs" on the basis that Gokan Yesilhat was jointly liable with Okan Yesilhat and Australia's Best Tyre & Auto Pty Ltd ("ABT") for the whole of the costs incurred by the three defendants, who were at times jointly represented. The object of order 4 was to determine the fair proportion of the whole of the cost that Ms Calokerinos should be ordered to pay Gokan Yesilhat. I had accepted that the approach adopted by Slattery J in the order set out in J [90] was in principle fair and appropriate in the circumstances. That was particularly so because Gokan Yesilhat was not the primary defendant of the three defendants. 3. In Calokerinos, Executor of the Estate of the late George Sclavos v Yesilhat; Yesilhat v Calokerinos, Executor of the Estate of the late George Sclavos (No. 4) [2020] NSWSC 1044 ("Judgement (No 4)"), from which order 3 above was extracted, Slattery J said at [61]: [61] The applicable rules of practice are clear. Ordinarily where a solicitor acts for more than one successful defendant in a proceeding, each successful defendant is only entitled to that party's proportion of the costs incurred on behalf of all, plus any extra costs incurred exclusively on behalf of that party; and this rule is said to be convenient for the "ordinary case" but is not to be automatically applied in every case: R Network Group Pty Ltd v Club of the Clubs Pty Ltd (No 2) [2009] NSWCA 204 , at [25]–[35]), (per Young JA, Hodgson and Campbell JJA agreeing) ("King Network Group"). 1. It did not necessarily follow that the appropriate proportion in these proceedings would be the same as that which Slattery J decided was the case in the proceedings that were before him. 2. Consequently, what I envisaged was that Ms Calokerinos and Gokan Yesilhat would each propose a single proportion, and then provide submissions to justify that proportion. 3. Ms Calokerinos delivered written submissions in response to the Court's invitation that were dated 6 March 2023. Ms Calokerinos' submissions proposed that she would be ordered to pay Gokan Yesilhat 7.5% of the common costs incurred by all three defendants for the period for which she was ordered to pay his costs on the ordinary basis, being from 22 May 2019 to 11 August 2020. Ms Calokerinos did not propose a single proportion for the subsequent period for which she would be required to pay Gokan Yesilhat's costs on the indemnity basis. Instead, she proposed that his costs be paid as to 7.5% of the common costs between 12 August 2020 and 21 July 2021 and 15% of the common costs for the period 22 July 2021 to 27 February 2023, which was the date that the primary judgment was delivered. 4. It appears from par 9 of Ms Calokerinos' written submissions that the date 21 July 2021 for the change from 7.5% to 15% was chosen on the basis that most of the court time and written submissions after 21 July 2021 related to the contempt application. That does not appear to me to be an appropriate date to change the relevant proportion in relation to the costs of the proceedings generally, because order 5 made on 27 February 2023 was an entirely separate costs order for the costs of the notice of motion filed on 5 August 2021 in which Ms Calokerinos alleged contempt of court against Gokan Yesilhat. 5. Ms Calokerinos' submission did not provide a clear basis for her proposed proportions of 7.5% and 15%. Ms Calokerinos made a series of assertions that were based upon Ms Calokerinos' view of the merits of Gokan Yesilhat's involvement in the events the subject of Slattery J's judgments and his conduct of the present proceedings. Ms Calokerinos' adoption of the proportion of 7.5% for the first period is evidently taken from order 3 made by Slattery J in Judgment (No 4) that has been referred to above. However, Ms Calokerinos has not provided any explanation as to why the proportionate involvement of Gokan Yesilhat that seemed appropriate to Slattery J in the proceedings determined by his Honour should be translated to Gokan Yesilhat's involvement in the present proceedings. 6. Gokan Yesilhat provided written submissions dated 13 March 2023. He started from the proposition that, in the absence of a rational evidentiary basis for distinguishing the position of three defendants who were jointly liable for the whole of their common legal costs, the appropriate approach was for the Court to treat the three defendants as being equally liable. Accordingly, Gokan Yesilhat proposed that the relevant proportion should be one third for the period 22 May 2019 to 11 August 2020. That was the period for which all three defendants were active in defence of the proceedings. 7. As ABT was placed into liquidation on 29 September 2020, and accordingly the proceedings against it were stayed from that date, there were two active defendants rather than three. Gokan Yesilhat proposed that the relevant proportion should be one half for the period between 30 September 2020 and 7 June 2021 during which there were two active defendants. 8. As the proceedings were stayed against Okan Yesilhat on 7 June 2021, by reason of the sequestration of his estate in bankruptcy, Gokan Yesilhat was left as the sole active defendant from that time. Consequently, Gokan Yesilhat proposes that Ms Calokerinos be ordered to pay 100% of his costs from 9 June 2021. 9. I accept Gokan Yesilhat's submission that, in these proceedings – whatever the position may have been in the related proceedings decided by Slattery J – there is nothing in the pleadings nor in the conduct of the case to distinguish between the conduct of the three defendants for the purpose of determining the appropriate relevant proportion. 10. In the circumstances, the proper course is for the Court to make the orders proposed by Gokan Yesilhat. 11. As already noted, order 3 made on 27 February 2023 contemplated that there would be only one relevant proportion. However, I have now accepted a submission that will have the effect that there will be different relevant proportions for three separate periods. It will therefore be necessary for the Court to vary the orders made on 27 February 2023. 12. The orders of the Court are: For the purpose of giving effect to orders 3 and 4 made by the Court in these proceedings on 27 February 2023, those orders shall be vacated and in lieu thereof the Court makes the following order: 1. Subject to order 5, orders against the plaintiff in favour of the fourth defendant to pay his costs of the proceedings as follows: 1. there be no order for costs for the period from the commencement of the proceedings up to 22 May 2019 with the intent that the parties will bear their own costs for that period; 2. the plaintiff shall pay one third of the costs incurred by the third, fourth and fifth defendants (the Yesilhat costs) between 22 May 2019 and 11 August 2020 on the ordinary basis; 3. the plaintiff shall pay one third of the Yesilhat costs between 12 August 2020 and 29 September 2020 on the indemnity basis; 4. the plaintiff shall pay one half of the Yesilhat costs between 30 September 2020 to 7 June 2021 on the indemnity basis; 5. the plaintiff shall pay all of the Yesilhat costs from 8 June 2021 on the indemnity basis. 1. Orders 1, 2, 5 and 6 made by the Court on 27 February 2023 are otherwise confirmed. ********** 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: 28 April 2023