Land and Environment Court of New South Wales CITATION : MORRIS v. THOMAS [1993] NSWLEC 177 (1 November 1993) [1993] NSWLEC 2 PARTIES : MORRIS v. THOMAS FILE NUMBER(S) : 30204 of 1991 CORAM: Bignold J KEY ISSUES: :- implementation of orders made in concluded proceedings - application to set aside Certificate of Taxation LEGISLATION CITED: Encroachment of Buildings Act 1922 Supreme Court Rules Pt 52 r 54A McLelland J in Phillips v Walsh (1990) 20 NSWLR 206 ; CASES CITED: in Spies v Commonwealth Bank of Australia (1991) 24 NSWLR 691; Phillips v Walsh DATES OF HEARING: 26 October 1993 DATE OF JUDGMENT: 10/27/1993 Mr J Kosmin (Sol) LEGAL REPRESENTATIVES: Mr B Hodgekiss (Barr) JUDGMENT: Bignold J.: I publish my reasons for judgment on the Applicant's Notice of Motion. My decision was to adjourn the proceedings to 10 November 1993 and to direct the Respondent to serve and file any affidavits by 3 November 1993. This is a Notice of Motion in which the Applicant seeks a number of orders in proceedings involving an application and cross application under the Encroachment of Buildings Act 1922 which were concluded by my judgment delivered on 22 May 1991 in which the following orders were made: "1. Application and cross-application each granted in part and dismissed in part. 2. Order the Applicant to remove the following encroachments from No 9 Leura Road, Double Bay. (a) the roof, gutter and quarry tiles of the carport located at the north-western corner of No 11 Leura Road, Double Bay; and (b) the guttering and barge board constructed on the roof of the lounge room wall. 3. Order the Applicant to pay the Respondent's costs. 4. On payment of the costs referred to in Order 3 and any expenses reasonably incurred by the Respondent in respect of the grant of easement hereinafter granted order the Respondent do grant to the Applicant an easement in respect of the encroaching lounge-room wall and encroaching carport wall encroaching upon No 9 Leura Road, Double Bay during the life of those encroachments. 5. Exhibits be returned." The present Notice of Motion (brought by the Applicant in the proceedings (filed on 6 October 1993)) seeks the following relief: 1) The Certificate of Taxation dated 14 October 1993 be set aside. 2) The Respondent's costs payable herein be $11,500. 3) The Respondent comply with Order 4. 4) The Respondent pay the Applicant's costs of the Motion. The Notice of Motion is supported by an affidavit sworn by the Applicant's Solicitor (Mr Kosmin) which deposes to the facts that (i) a bill of costs was filed in the proceedings by the Respondent (para 4); (ii) prior to expiry of the time for objection to the bill of costs the parties solicitors engaged in discussions seeking to agree upon the costs payable rather than require taxation (para 5); and annexes correspondence passing between the parties or their solicitors commencing with the deponent's letter dated 23 October 1992 to the Respondent's solicitors confirming that the Applicant had offered to pay $11,500 "in full and final satisfaction upon your client signing the appropriate documents and making necessary arrangements for registration of the transfer granting easement and advising, inter alia": "In relation to the quantum of costs, we advise that unless our client's offer is complied with within 7 days of the date hereof we shall file a Motion seeking to have the Certificate of Taxation set aside and to have the bill of costs taxed." The correspondence annexed to the affidavit includes the Respondent's solicitor's letter dated 29 October 1992 which accepts the offer of $11,500 party and party costs and invites preparation of the easement documentation and notes that its execution "is conditional upon your client removing the barge board and the rubbish." There is no need to consider the content of subsequent correspondence passing between the parties other than to note, the obviously lamentable fact that some two and a half years after the Court's judgment, the orders then made are still substantially unperformed and the parties seem to be as much at loggerheads as they were when the litigation was conducted in May 1991 (save for the providential fact that they are no longer neighbours, the Applicant having sold his property soon after the 1991 judgment). Matters recently came to a head when the Respondent obtained a writ for levy of property of the Applicant in respect of the sum of $17,838.71 (being the amount of costs certified in the Certificate of Taxation issued in those proceedings on 14 October 1992) plus interest from 22 May 1991 at the rate of 11.25%. Execution on that writ has been informally suspended by the Respondent (at the Applicant's request) pending the outcome of the present Notice of Motion. At the outset of the hearing of the Notice of Motion, Counsel for the Respondent raised objection on the ground that the Notice of Motion in the proceedings was not the appropriate procedure to obtain the relief claimed. In support of this objection reliance was placed upon the judgment of McLelland J in Phillips v Walsh (1990) 20 NSWLR 206 and the judgment of Handley JA (agreed in by other members of the Court of Appeal) in Spies v Commonwealth Bank of Australia (1991) 24 NSWLR 691. As I understood the Respondent's submission it was to the effect that since the purpose and effect of the Notice of Motion was to set aside an existing order of the Court (in this case the issue of the Certificate of Taxation) and to enforce a suggested compromise, the seeking of such relief should be in the form of separate proceedings . Moreover the Respondent denied the existence of any compromise or binding agreement as to the costs payable pursuant to the Court's order of 22 May 1991 that the Applicant pay the Respondent's costs, and stated that if his objection as to the proper procedure was not upheld he would wish to adduce evidence in support of his claim that there was no binding agreement as to costs. In response to my prompting that the matter be now finally resolved as quickly and inexpensively as possible, the Respondent indicated that he would be prepared to consent to the setting aside of the Certificate of Taxation upon the terms that the Applicant be bound to pay interest on the taxed costs pursuant to Pt 52 r 54A of the Supreme Court Rules calculated from 14 October 1992 being the date of the issue of the Certificate of Taxation until 15 July 1993 when payment of $11,500 was tendered to Respondent (but was rejected). The Applicant would not accept such terms and submitted that any question of interest on costs should be left to the exercise of discretion by the Court's taxing officer under Supreme Court Rules Pt 52 r 54A . The Certificate of Taxation issued in the present case on 14 October 1992 was made on the authority of Supreme Court Rules Pt 52 r 50A(7) ie in default of any notice of objection being made by the Applicant to the bill of costs filed and served by the Respondent. There is no suggestion that the Certificate was not properly issued, the alleged compromise occurring after the issue of the Certificate. It is conceded by the Respondent that the Court has power, pursuant to Supreme Court Rules Pt 52 r 59(8) to set aside the Certificate of Taxation, made in this case pursuant to Supreme Court Rules Pt 52 r 50A(7) . Rule 59(8) in its form - applicable to the present case, empowers the Court to exercise the power upon terms . In the light of the availability of the express power to set aside the Certificate of Taxation in the present case the need for an adjudication on the apparently vexed and disputed questions of (i) whether the parties reached agreement on costs, and (ii) if so whether that agreement is presently binding, would appear to be an unnecessary detour in the implementation of the Court's 1991 orders (already seriously delayed) with additional and avoidable costs being incurred by the parties. However the more important immediate consequence of the availability of the power for the Court to set aside the Certificate of Taxation is that I am unable to accept the Respondent's submission that the relief sought by the Applicant cannot be obtained by the procedure of Notice of Motion in the proceedings. In my judgment the present case is not the type of case that is discussed in the two decisions relied upon by the Respondent. For example, Spies case involved an attempt to set aside a consent judgment on the ground of fraud and in Phillips v Walsh , McLelland J did not essay an extended analysis of the decided cases which, he thought presented "a confusing picture". Moreover I did not understand the Applicant's claim to set aside the Certificate of Taxation to be entirely or exclusively founded on his assertion of the existence of an agreement between the parties as to costs. It is quite possible that his claim to have the Certificate of Taxation set aside may be supported on the basis of his belief and understanding that an agreement had been reached, whether or not such was the case, either in fact or in law. As the evidence stands, it is clear that the Applicant did not seek to set aside the Certificate of Taxation after his offer to pay $11,500 had apparently been accepted. The present problem has arisen because the Applicant left the Certificate of Taxation on foot, undisturbed. Accordingly I overrule the Respondent's objection that the present Notice of Motion is not the appropriate means or form for seeking the relief claimed by the Applicant. However at this stage, I am unable to determine the Applicant's claims to relief because the Respondent seeks the opportunity to adduce evidence in support of his case resisting the relief claimed. Obviously the Respondent is entitled to have the opportunity to adduce evidence in support of his defence. To that end I propose to adjourn the Notice of Motion for a fortnight and I direct the Respondent to serve and file affidavits within one week. It may assist the parties and their legal advisers if I say that if the evidence ultimately adduced is confined to the Applicant's solicitor's affidavit which I have already read (or the end result is that evidence remains unchallenged) I would be disposed to exercise the discretion conferred by Supreme Court Rules Pr 52 r 59(8) and set aside the Certificate of Taxation and direct the Applicant to file objections to the Respondent's bill of costs within 14 days without imposing any terms concerning interest, but leaving that matter to the Court's taxing officer. A practical consequence of such a decision would be to render wholly unnecessary any adjudication upon the apparently vexed questions of whether any agreement (as to the quantum of costs) was made between the parties and if so whether it is still binding. 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.