Melrose Cranes and Rigging Pty Ltd v. Manitowoc Crane Group Australia Pty Ltd (No. 2) [2012] NSWSC 1048

Supreme Court New South Wales

Medium Neutral Citation: Melrose Cranes and Rigging Pty Ltd v. Manitowoc Crane Group Australia Pty Ltd (No. 2) [2012] NSWSC 1048 Hearing dates: In Chambers Decision date: 14 September 2012 Jurisdiction: Common Law Before: S.G. Campbell J Decision: The defendant's application under Rule 36.16 for the reconsideration of my costs order made on 17th August 2012 is refused. The costs payable by the defendant pursuant to that costs order extend to Underwriting Agency of Australia Pty Ltd's costs of the application for reconsideration. Catchwords: COSTS - application under Rule 36.16 UCPR for reconsideration of costs order - application refused. Legislation Cited: Uniform Civil Procedure Rules 2005 Cases Cited: Turkmani v. Visvalingam (No. 2) [2009] NSWCA 279 Category: Interlocutory applications Parties: Manitowoc Crane Group Australia Pty Ltd (applicant) Underwriting Agency of Australia Pty Ltd (respondent) Representation: Counsel: R Cheney SC (applicant) A Stewart (respondent) Solicitors: Lee & Lyons Lawyers (applicant) Beston Macken McManis (first respondent) Hicksons Lawyers (second respondent) File Number(s): 2010 / 232918

Judgment 1My judgment in this matter was given on the 17th of August 2012. My orders included an order that the defendant pay Underwriting Agency of Australia Pty Ltd's costs of the application on the ordinary basis forthwith after they had been agreed or assessed. 2Pursuant to liberty extended in that regard, the defendant has applied for a variation of that costs order under Rule 36.16 Uniform Civil Procedure Rules 2005. The application has been made by the lodgement of written submissions as permitted by me. 3The application has been considered in chambers, "on the papers" without the need for counsel to attend. 4The defendant seeks variation of the costs order made by me so that it provides as follows: The defendant is to pay 60 per cent of Underwriting Agency of Australia Pty Ltd's costs of the application in relation to prayer 6, on the ordinary basis forthwith after they have been agreed or assessed. 5Underwriting Agency of Australia Pty Ltd (UAA) has lodged written submissions resisting the application. 6The argument on each side has been advanced with admirable succinctness. Essentially, the defendant argues that when the dispute as to legal professional privilege arose UAA claimed privilege in respect of 31 documents. By the time the dispute came before me on 2nd July 2002, UAA had surrendered its claim in respect of certain documents reducing the number in dispute to 18. The defendant argues it "won" in respect of the excess which it quantifies as a 40 per cent "win". 7UAA points out that the defendant wrongly ... persisted with it's application for access to the balance. And, in any event, it was clear by the 22nd of June 2012 that it's claim was advanced in respect of 18 documents only, the excess having been gradually relinquished between 8th March 2012 and 22nd June 2012. 8The applicable principles were expressed by Hodgson JA, with whom Beazley and McColl JJA agreed, in Turkmani v. Visvalingam (No. 2) [2009] NSWCA 279 from [9] to [12]: [9] The applicable principles were stated as follows in the joint judgment of Beazley, Tobias and McColl JJA in James v Surf Road Nominees (No 2) [2005] NSWCA 296 at [31]-[33]: [31] Costs orders in the Supreme Court are governed by the provisions of s 76 of the Supreme Court Act 1997 and the Supreme Court Rules. Section 76 provides, relevantly that subject to the Act and the Rules, costs shall be in the discretion of the Court: s 76(1)(A). Part 52A r 11 acts as a limited proscription of the Court's discretion conferred by s 76. Part 52A r 11 provides that, subject to Pt 52A, the Court shall order that costs follow the event "except where it appears to the Court that some other order should be made as to the whole or any part of the costs". [32] The effect of Pt 52A r 11 is that an unsuccessful party may be ordered to pay the entirety of the costs of the successful party, even though the successful party did not succeed on all issues. However, as is specified by the rule itself, the court is entitled to make a different order. That may occur where there are multiple issues involved. This was the subject of comment in Waters v P C Henderson (Aust) Pty Ltd (unreported CA(NSW) Kirby P, Mahoney and Priestley JJA, 6 July 1994) where Mahoney JA said: Where the proceedings involve multiple issues the application of the rule that costs follow the event may involve hardship where a party succeeds on some issues and yet fails on others. Particularly is this so where, for example, a defendant succeeds on issues that occupied the bulk of the time taken by the proceedings. Nevertheless, unless a particular issue or group of issues is clearly dominant or separable, it will ordinarily be appropriate to award the costs of the proceedings to the successful party without attempting to differentiate between those particular issues on which it was successful and those on which it failed. [33] Similarly, Toohey J made the following observations in Hughes v Western Australian Cricket Association (1986) ATPR 40-748: 1. Ordinarily, costs follow the event and a successful litigant receives his costs in the absence of special circumstances justifying some other order. 2. Where a litigant has succeeded only upon a portion of his claim, the circumstances may make it reasonable that he bear the expense of litigating that portion upon which he has failed. 3. A successful party who has failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the party's costs of them. In this sense, "issue" does not mean a precise issue in the technical pleading sense but any disputed question of fact or of law. (references omitted) [10] Those paragraphs were quoted with approval in Roads and Traffic Authority v McGregor (No 2) [2005] NSWCA 453 at [17]: and there are similar statements of principle in Monie v Commonwealth (No 2) [2008] NSWCA 15 at [63]-[65] and Rockdale City Council v Micro Developments Pty Ltd [2008] NSWCA 128 at [115]. [11] In the present case, in my opinion, the issues of liability and apportionment for contributory negligence were not clearly severable: all the arguments relied on by the appellant with a view to negativing liability had, to a greater or lesser extent, some bearing on the court's overall assessment of the respective degrees of fault of the appellant and the deceased. [12] The principles stated in the cases have an alternative basis for departure from the usual order as to costs, namely where the successful party fails on a "clearly dominant issue". That seems to suggest that if an issue can be identified that was clearly dominant, on which the successful party failed, the usual order may be departed from even though that issue was not clearly severable. Here, the respondents argued to the effect that the issue of liability was clearly dominant. 9As a general proposition then, costs may be apportioned or reduced when the unsuccessful party has "won" on an issue, or issues, which was or were clearly severable or clearly dominant. 10In my judgment, neither test has been satisfied here. There were two issues: one, was privilege attracted; and two, had UAA waived privilege by its conduct? UAA was successful, and the defendant unsuccessful on each. 11As I observe at [53] of my previous judgment it would be pointless to consider how (UAA) may have faired had it not modified it's position. The question is too hypothetical to have any bearing on the practical question of costs. 12My orders are: (1)The defendant's application under Rule 36.16 for the reconsideration of my costs order made on 17th August 2012 is refused. (2)The costs payable by the defendant pursuant to that costs order extend to Underwriting Agency of Australia Pty Ltd's costs of the application for reconsideration.