Pacific Blue Australia Pty Ltd v Somalis [2008] NSWSC 75

New South Wales Supreme Court

CITATION : Pacific Blue Australia Pty Ltd v Somalis [2008] NSWSC 75

HEARING DATE(S) : 8 February 2008

JUDGMENT DATE : 8 February 2008

JURISDICTION : Equity Division

JUDGMENT OF : Palmer J

EX TEMPORE JUDGMENT DATE : 8 February 2008

DECISION : Defendant to pay Plaintiff's costs on indemnity basis.

CATCHWORDS : INDEMNITY COSTS – CAVEAT – Caveat incurably bad in form – settlement of contracts imminent – caveator offers to withdraw caveat when proceedings threatened – order for removal made – whether costs reasonably incurred – whether costs should be ordered on indemnity basis.

CATEGORY : Consequential orders

CASES CITED : - Downie v Kenny & Kenny Pty Ltd, unrep., 16 September 1985; BC8500545 - Pacific Blue Australia Pty Ltd v Somalis [2008] NSWSC 16

PARTIES : Pacific Blue Australia Pty Ltd (Plaintiff) John Somalis (Defendant)

FILE NUMBER(S) : SC 1192/08

COUNSEL : D. Macfarlane (Plaintiff) T. Hall (Sol) (Defendant)

SOLICITORS : John Edmunds Solicitor (Plaintiff) Hall Partners Pty Ltd (Defendant)

1192/08 Pacific Blue Australia Pty Ltd v Somalis

JUDGMENT – Ex tempore 8 February, 2008

1 On 22 January 2008 Campbell JA, sitting as Vacation Duty Judge, made an order for the removal of certain caveats which had been lodged by the Defendant against the Plaintiff's land: see Pacific Blue Australia Pty Ltd v Somalis [2008] NSWSC 16. His Honour reserved the question of costs. The question of costs has now come before me in the Duty Judge List in circumstances which I need not recount. It is sufficient to say that both parties have now agreed that it is appropriate that I deal with the matter and, as there is no other pressing matter in the Duty Judge's List, I will do so in order to avoid the parties incurring any further unnecessary expense. The circumstances giving rise to the question may be narrated very shortly. 2 The Defendant lodged certain caveats against the Plaintiff's land on about 11 January 2008. The caveats showed that the address for service of notices on the caveator was the address of the Defendant's present solicitor. I assume from that circumstance and from the manner of drafting of the caveat forms that the caveats were indeed prepared by the Defendant's solicitor. 3 The Plaintiff protested that the caveats disclosed no caveatable interest. There having been no undertaking to withdraw the caveats prior to 22 January 2008, the Plaintiff approached the Duty Judge for orders seeking the removal of the caveats. However, there had been correspondence between the parties' solicitors prior to that time. That correspondence, however, had produced no unequivocal undertaking on the part of the Defendant to remove the caveats. 4 On 22 January, the Defendant's solicitor sent to the Plaintiff's solicitor an e-mail at about 9.20am which gave an unequivocal assurance that the caveats would be removed that day and that the Defendant would commence the appropriate proceedings to enforce his claim. That e-mail was followed by a further e-mail at 9.58am repeating the assurance. 5 Those circumstances were drawn to the attention of his Honour when the Plaintiff approached him in the course of the Duty Judge list that day. His Honour said this in the judgment: "In these circumstances, it is clear that the substance of the application is already known to the solicitor for the caveator. Further, the caveator's position is that the caveats will be withdrawn today.