Lava Limited v Avery [2009] NSWSC 237

New South Wales Supreme Court

CITATION : Lava Limited v Avery [2009] NSWSC 237

HEARING DATE(S) : 17-18 March 2009

JUDGMENT DATE : 2 April 2009

JURISDICTION : Common Law

JUDGMENT OF : Price J at 1

DECISION : 1. The Court orders that the defendant pays the plaintiff's costs of the proceedings on an ordinary basis up to and including 11 June 2008 2. The Court orders that the defendant pays the plaintiff's costs of the proceedings on an indemnity basis from 12 June 2008

CATCHWORDS : COSTS - mortgage agreement - contractual entitlement to indemnity costs - court's discretion as to costs - pleadings - late withdrawal of defence and cross-claim - indemnity costs

LEGISLATION CITED : Civil Procedure Act 2005 s 98(1), s 98(2)

CATEGORY : Consequential orders

Gomba Holdings UK Limited & Others v Minories Finance Limited & Others (No2) [1993] Ch 171 CASES CITED : Kyabram Property Investments Pty Ltd v Murray [2005] NSWCA 87 National Australia Bank Ltd v Landy Chen-Conway [2008] NSWSC 485 Wentworth v Rogers (No5) (1986) 6 NSWLR 534

PARTIES : Lava Limited Leanne Maree Avery

FILE NUMBER(S) : SC 2007/13418

COUNSEL : M. Condon (Plaintiff/Cross-defendant) R. Alkadamani (Defendant/Cross-claimant)

SOLICITORS : S. Rogers (Plaintiff/Cross-defendant) R. Commins (Defendant/Cross-claimant)

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

PRICE J

2 April 2009

13418/2007 Lava Limited v Leanne Maree Avery

JUDGMENT on costs 1 HIS HONOUR: When judgment was delivered on 18 March 2009 in these proceedings, costs were reserved. The plaintiff sought an order that the defendant pay its costs on an indemnity basis. The principal foundation for the plaintiff's submission was its entitlement to costs on an indemnity basis pursuant to the Loan Agreement and the terms of the Mortgage. 2 Clause 6.1 of the Loan Agreement (exhibit C) upon which the plaintiff relies is as follows: " Costs The Borrower shall pay the Lender all legal fees (including solicitor and own client fees) and disbursements incurred in relation to the preparation of this Agreement and the Securities and exercise or enforcement by the Lender of its rights under this Agreement and any Securities." 3 Clause 21.2 of the Mortgage (exhibit 1) upon which the plaintiff relies is as follows: " Indemnity The Mortgagor indemnifies and keeps indemnified the Mortgagee, any Receiver, any attorney appointed under this Mortgage and any employee, officer, agent or contractor of the Mortgagee, any Receiver or attorney appointed under this Mortgage, against any liability or loss arising from, and any costs, charges, expenses and liabilities incurred in relation to: (a) the payment, omission to make payment or delay in making payment of an amount referred to in clause 21.1;