Sassine v Mondray Pty Limited [2011] NSWSC 523

Supreme Court New South Wales

Medium Neutral Citation: Sassine v Mondray Pty Limited [2011] NSWSC 523 Hearing dates: Written submissions Decision date: 03 June 2011 Jurisdiction: Equity Division - Corporations List Before: Barrett J Decision: The further orders are: 1. Order that the originating process filed on 7 October 2008 be dismissed. 2. Order that Charlie Sassine pay the costs of George Sassine of the proceedings, such costs to be assessed: (a) on the ordinary basis up to and including 22 March 2011; and (b) on the indemnity basis thereafter. Catchwords: PROCEDURE - costs - no matter of principle Legislation Cited: Corporations Act 2001 (Cth), s 237 Cases Cited: Sassine v Mondray Pty Ltd [2011] NSWSC 297 Category: Costs Parties: Charlie Sassine - Applicant George Sassine - Respondent Representation: Counsel Mr C A Evatt/Mr S Milanovic - Applicant Mr M R Pesman/Ms E A Weisske - Respondent Solicitors Slattery Thompson Solicitors - Applicant HW L Ebsworth Lawyers - Respondent File Number(s): 2008/00280995

Judgment 1I am dealing with the question of costs in consequence of my judgment of 15 April 2011: Sassine v Mondray Pty Ltd [2011] NSWSC 297. 2The application of Charlie Sassine, brought by amended notice of motion filed on 20 July 2010, for leave under s 237 of the Corporations Act 2001 (Cth) was dismissed. He had sought leave to bring certain proceedings on behalf of Mondray Pty Ltd against George Sassine. 3The form of the amended notice of motion was irregular in that it named Mondray Pty Ltd as the applicant. It was clear, however, that Charlie Sassine was the applicant, he and another person (no longer a party) having originally sought leave under s 237 by an originating process filed on 7 October 2008. The matter was argued on that basis. 4George Sassine was named in the amended notice of motion as the person affected by the order sought. That too is consistent with the manner in which the matter was in fact approached. 5It is also relevant to record that, although George Sassine was the person against whom the proposed derivative action was to be brought, he is one of three members of Mondray Pty Ltd, so that he had a proper interest in the question of who, if anyone, should bring on the company's behalf proceedings that its directors were not willing to see it commence. 6There is, in my opinion, no reason why costs should not follow the event, so that Charlie Sassine is ordered to pay George Sassine's costs of the s 237 application. The submission that George Sassine should be denied costs because his hands "were far from clean" cannot be accepted, given that the basis for the submission lies in matters that would have been elucidated only if the derivative action been allowed to proceed. 7George Sassine contends that the costs to be paid by Charlie Sassine should be assessed on the indemnity basis either in whole or after 22 March 2011. 8The proposition that the costs should, as to the whole, be assessed on the indemnity basis is advanced on the footing that there were repeated breaches of directions by Charlie Sassine and that the s 237 claim was always hopeless in view of the existing second cross-claim on the 2007 proceedings. I am not satisfied that indemnity costs are warranted on any such basis. 9The proposition that costs after 22 March 2011 should be on the indemnity basis is founded on a letter of 16 March 2011 from George Sassine's solicitors to Charlie Sassine's solicitors. By that letter, George Sassine's solicitors proposed that the s 237 application be resolved consensually on the basis of its being dismissed with an order that Charlie Sassine pay half George Sassine's costs as agreed or assessed. The offer was expressed to be open until 5pm on 22 March 2011. The letter raised, among other things, the existing second cross-claim which was described as "fatal to your client's case". This was said against the background of a description of factual matters regarding the proceeds of the sale of Mondray's property. The letter also said that it would be tendered on an application for indemnity costs if Charlie Sassine did not succeed in his s 237 application. 10Given the outcome of that application and the circumstance that the court in fact held that the existing second cross-claim was fatal to Charlie Sassine's claim was fatal to Charlie Sassine's claim (something that was explained in the letter and not at all difficult to appreciate), it was unreasonable for Charlie Sassine not to accept the offer in the letter of 16 March 2011. 11Indemnity costs after 22 March 2011 are therefore appropriate. 12Another matter requiring attention, as a formality, is dismissal of the originating process filed on 7 October 2008 (the claim for s 237 leave in the amended notice of motion filed on 20 July 2020 has already been dismissed). 13The further orders are: 1. Order that the originating process filed on 7 October 2008 be dismissed. 2. Order that Charlie Sassine pay the costs of George Sassine of the proceedings, such costs to be assessed: (a) on the ordinary basis up to and including 22 March 2011; and (b) on the indemnity basis thereafter.