TRADERS PRUDENT INSURANCE CO LTD v GUMODIN PTY LTD SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL KIRBY P 15 February 1988 [1988] NSWCA 159 COSTS motion — disposition of — numerous mentions in Court — proper order — application that costs be reserved — application that costs be costs in appeal — held: (1) Inappropriate to reserve on disposition of motion; desirable that costs orders be made while issues fresh in mind; (2) Costs orders should follow principles; (a) that costs of motions are normally made against party in default; and (b) that costs normally go to successful party; (3) On that basis claimant should have costs. ORDERS (1) That the costs of and incidental to the motion of the claimant commenced on 2 December 1987 and all subsequent proceedings on the motion be paid by the opponent; and (2) Order (1) is without derogation from the special order made on 8 February 1988 that the costs of and incidental to the proceedings before the Court on that day should be paid by the opponent on a solicitor and client basis. Kirby P Few matters in the court are more fiercely contested than matters of costs. This is a disputed application for the general costs of a notice of motion. In order to explain the order which I will make, it is necessary to set out briefly the course of the history of this litigation. The case concerns a claim under an insurance policy which was brought by the appellant-opponent against the respondent-claimant insurer. The proceedings was heard before Lusher J in September 1985. His Honour gave judgment on 20th September 1985. A notice of appeal was filed by the opponent on 16 October 1985. However, that notice of appeal was not served as required by the Rules. Indeed, it was not served until 24 November 1987. In the meantime, the claimant says that the major asset the subject of the litigation, was transferred by the opponent to a Mr Lewis, the managing director of the opponent, on 18th June 1986. Despite the notice of appeal of which it was ignorant, the claimant proceeded with the taxation of its costs. It appears, by inference, that only the service of the certificate of taxed costs propelled the Opponent into prosecuting seriously the appeal which it had lodged in October 1985. The notice of appeal having been served and an appointment having been made to settle the index to the appeal papers, the claimant commenced proceedings by motion in the Court seeking dismissal of the appeal by reason of the above delays. Alternatively, the claimant sought an order for security for costs. When that motion came before the Court on 14 December 1987 it was compromised. Certain conditions were laid down under which the opponent agreed to give certain security. That security was to compromise a personal guarantee by a director of the opponent, a second mortgage on certain real property, and a guarantee by an approved financial institution. The first and second condition were fulfilled as the Court ordered. But there was serious delay in the fulfillment of the third. 2 UNREPORTED JUDGMENTS Because of that delay, the claimant brought the matter back to the Court on three occasions in February 1988. On the last occasion the failure of the opponent adequately to explain the delay caused me to order that the opponent pay the costs of the proceedings on that day, 8 February 1988, on a solicitor and client basis. The question now for answer is what order should be made for the disposition of the general costs of the motion. The solicitor appearing for the opponent urged that costs should be reserved. However, to take this course would be Unsatisfactory as the detail of this aspect of the litigation may in due course be forgotten, It is therefore desirable that the Court should now settle the disposition of these costs once and for all. As well, the motion is in a real sense severable from the appeal. The second submission which was made was that the costs of the motion should, save for the special order made on 8 February 1988, be costs in the appeal. In favour of adopting this course would be the fact that the costs have been incurred as ancillary to the appeal proceedings, But against that course is the fact that the motion was substantially occasioned by the gross delays in the Prosecution of the appeal on the part of the opponent, the revival of the appeal only after a Certificate of taxation was served and the transfer of the major asset of the appellant-opponent during the intervening period between the filing of the notice of appeal and the Proceedings by motion. In these circumstances it seems to me that the just disposition of costs is an order that the general costs of the motion should be paid by the opponent. That order will be without prejudice to the special order made by me on 8 February 1988. The orders which I propose to make are made out of deference to two Principles which are commonly followed in disposing of costs in this Court. The first is that costs are normally ordered against the party whose default has occasioned the legal process before the Court. The second is that costs are normally ordered in favour of the party succeeding in the process before the Court. On either and both of those principles the present claimant is entitled to its costs. That is why I would order:- (1) That the costs of and incidental to the motion of the claimant Commenced on 2 December 1987 and all subsequent proceedings on the motion be paid by the opponent; and (2) Order (1) is without derogation from the special order made on 8 February 1988 that the costs of and incidental to the proceedings before the Court on that day should be paid by the opponent on a solicitor and client basis.