Supreme Court New South Wales Medium Neutral Citation: In the matter of The Consortium Centre Pty Limited (No 2) [2012] NSWSC 1093 Hearing dates: 19, 20 and 25 July 2012 Decision date: 13 September 2012 Jurisdiction: Equity Division - Corporations List Before: Black J Decision: First Defendant/Applicant to pay Respondents' costs of and incidental to Interlocutory Process filed 5 March 2012 on the ordinary basis, as agreed or assessed. Such costs be assessable and payable forthwith. Catchwords: COSTS - Orders - Costs orders following judgment dismissing Interlocutory Process - Whether there is any reason that costs should not follow the event. Legislation Cited: - Civil Procedure Act 2005 (NSW) s 98(1) - Uniform Civil Procedure Rules 2005 (NSW) rr 42.1, 42.7(1), 42.7(2) Cases Cited: - Howards Storage World Pty Ltd v Haviv Holdings Pty Ltd [2010] FCAFC 5; (2010) 182 FCR 84 - Kallinicos v Hunt [2006] NSWSC 723 - Milne v Attorney-General (Tas) [1956] HCA 48; (1956) 95 CLR 460 - Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 - Ruddock v Vadarlis (No 2) [2001] FCA 1865; (2001) 115 FCR 229 Category: Costs Parties: The Consortium Centre Pty Limited (Plaintiff) Robert Anthony Keogh (First Defendant) Rewardweb Pty Limited (Second Defendant) Promotion Marketing Pty Limited (Third Defendant) Urma Pty Limited (Fourth Defendant) Course Logistics Services Pty Limited (Fifth Defendant) Robert Anthony Keogh (Applicant) Robinson Legal Pty Limited (First Respondent) Andrew Robinson (Second Respondent) Dominique Robinson (Third Respondent) Julie Briscoe (Fourth Respondent) Representation: Counsel: J. Ireland QC (First Defendant/Applicant) D.R. Pritchard SC (Respondents) Solicitors: D.C. Balog & Co (First Defendant/Applicant) Robinson Legal (Respondents) File Number(s): 11/268286 Judgment 1On 19, 20 and 25 July 2012, I heard an Interlocutory Process filed by the First Defendant, Mr Robert Keogh, which sought orders that Robinson Legal Pty Limited and several of its solicitors (together, "Robinson Legal") be restrained from acting further on behalf of the Plaintiff, The Consortium Centre Pty Limited, in these proceedings. I delivered judgment dismissing that application on 10 August 2012. I noted that, in the ordinary course, an order would be made that Mr Keogh pay Robinson Legal's costs of the Interlocutory Process on the basis that costs would follow the event, but indicated that I would hear the parties as to costs. 2Mr Keogh has conceded that Robinson Legal is entitled to a costs order in its favour "in some measure". He contends that, in the light of the manner in which the matter was conducted, that costs order should not extend to the entirety of the costs of the Interlocutory Process. Mr Keogh proposes that an order should be made that he pay two-thirds of Robinson Legal's costs of the Interlocutory Process and that those costs should be assessed forthwith. Robinson Legal contends that Mr Keogh should pay its costs of the Interlocutory Process on the basis that costs should follow the event under r 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR"). 3Section 98(1) of the Civil Procedure Act 2005 (NSW) relevantly provides that: "Subject to rules of court and to this or any other Act: (a) costs are in the discretion of the court; and (b) the court has full power to determine by whom, to whom and to what extent costs are to be paid, and (c) the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis." Rule 42.1 of the UCPR in turn provides that, where the Court makes an order as to costs, the Court is to order that costs follow the event unless it appears to the Court that some other order should be made as to the whole or any part of the costs. 4The principles underlying an award of costs include that costs are awarded to compensate the successful party for the expense of being put to the necessity of litigation; a wholly successful defendant should ordinarily receive its costs unless good reason is shown to the contrary; and the discretion to order costs must be exercised judicially and not against the successful party except for some reason connected with the proceedings: Milne v Attorney-General (Tas) [1956] HCA 48; (1956) 95 CLR 460 at 477; Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 at 97-98 per McHugh J, at 129-123 per Kirby J; Ruddock v Vadarlis (No 2) [2001] FCA 1865; (2001) 115 FCR 229 at 234. In Howards Storage World Pty Ltd v Haviv Holdings Pty Ltd [2010] FCAFC 5; (2010) 182 FCR 84, Gray J observed at [17] that: "The overriding principle that costs are in the discretion of the Court can also be expressed in terms of the negative proposition that no rule or principle should be applied mechanically in the determination of the question where costs should lie in any particular case. Attention must always be paid to the particular circumstances of the individual case. The aim is to do substantial justice in relation to costs, based on the outcomes of the various issues in the proceeding, as between the entities that are parties to that proceeding." 5Mr Keogh criticises the length of his cross-examination. I do not consider that the cross-examination of Mr Keogh, or indeed Mr Keogh's cross-examination of witnesses in Robinson Legal's case was unnecessary, although I ultimately held that I did not need to reach credit findings in respect of the witnesses in order to determine the Interlocutory Process. I also do not consider that the length of Mr Keogh's cross-examination was so out of the ordinary or unreasonable as to affect the ordinary result of Robinson Legal's success in defending the Interlocutory Process, namely that Mr Keogh should pay their costs of the Interlocutory Process. 6Mr Keogh also contends that it was not until final written submissions on behalf of Robinson Legal that a concession was made which refined the issues with effect that if the solicitor on the record (Ms Briscoe) was restrained from acting, two other solicitors from Robinson Legal (Mr Robinson and Mrs Robinson) would not take up conduct of the proceedings. I do not consider that concession had any significant impact on the outcome of the Interlocutory Process, since Mr Keogh's claim to restrain Ms Briscoe from acting depended on the criticisms that he sought to advance of Mr Robinson and Mrs Robinson's role in the proceedings. Mr Keogh would have needed to advance those criticisms in order to pursue his claim that Ms Briscoe should be restrained from acting and that claim was ultimately unsuccessful. 7In my view, these matters do not warrant a departure from the usual position than an order for costs should be made in favour of Robinson Legal, as the successful party in a discrete application, so as to compensate them for the costs to which they were put in defending the application. 8Rule 42.7(1) of the UCPR provides that, unless the Court otherwise orders, the costs of any application or step in any proceedings are to be paid and otherwise dealt with in the same way as the general costs of the proceedings. Rule 42.7(2) provides that, unless the Court otherwise orders, costs referred to in r 42.7(1) are not payable until the conclusion of the proceedings. Robinson Legal may have been entitled to proceed to an assessment of its costs forthwith, without any order of the Court to that effect, since the application was in substance a separate proceeding against the solicitors who were a third party to the proceedings: Kallinicos v Hunt [2006] NSWSC 723 at 8. However, for the avoidance of doubt, I should order that the costs of the application be payable forthwith. 9Accordingly, I make the following orders: 1. The First Defendant/Applicant pay the Respondents' costs of and incidental to the Interlocutory Process filed on 5 March 2012 and heard on 19, 20 and 25 July 2012 on an ordinary basis, as agreed or as assessed. 2. For the avoidance of doubt, the costs payable by the First Defendant/Applicant be assessable and payable to the Respondents forthwith. ********** 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. Decision last updated: 19 September 2012