Toben v Mathieson (No 2) [2014] NSWSC 575

Supreme Court New South Wales

Medium Neutral Citation: Toben v Mathieson (No 2) [2014] NSWSC 575 Hearing dates: On written submissions Decision date: 13 May 2014 Before: McCallum J Decision: Application by third defendant for an order that costs be payable forthwith refused Catchwords: COSTS - application to have costs payable forthwith - no warrant for departure from usual position that costs are assessable after the conclusion of proceedings Cases Cited: Dank v Whittaker (No 1) [2013] NSWSC 1062 Fiduciary Ltd v Morningstar Research Pty Ltd [2007] NSWSC 432; (2002) 55 NSWLR 1 Solaris Projects v Vero Insurance (No 4) [2013] NSWSC 1012 Toben v Mathieson; Toben v Nationwide News Pty Ltd [2013] NSWSC 1530 Toben v Milne [2014] NSWCA 49 Category: Costs Parties: Proceedings 2013/200128: Dr Fredrick Toben (plaintiff) Clive Mathieson (first defendant) Christian Kerr (second defendant) Senator Christine Milne (third defendant) Representation: Counsel: CA Evatt with R Rasmussen (plaintiff) J Hmelnitsky SC (first and second defendants) R Potter (third defendant) Solicitors: Carters Law Firm (plaintiff) Ashurst Australia Lawyers (first and second defendant) Fitzgerald & Browne Lawyers (third defendant) File Number(s): 2013/200128 Publication restriction: None

Judgment 1HER HONOUR: These are proceedings for defamation brought by Dr Fredrick Toben arising out of the publication of an article in the national newspaper, The Australian. On 18 October 2013 I determined an application by Dr Toben for leave to file an amended statement of claim. The amendment sought to add a cause of action against Senator Milne alleging that the remarks attributed to her in the newspaper article amounted to misleading or deceptive conduct or unconscionable conduct contrary to section 18(1) of the Australian Consumer Law. I refused leave to amend to include that claim. In the same judgment, I also determined Senator Milne's objections to the imputations in the existing statement of claim. I struck out two of the plaintiff's imputations: Toben v Mathieson; Toben v Nationwide News Pty Ltd [2013] NSWSC 1530. 2Dr Toben sought leave to appeal against both parts of the decision. The Court of Appeal refused leave in respect of the claims under the Australian Consumer Law and in respect of one of the imputations but granted leave to appeal in respect of the decision to strike out imputation (a): Toben v Milne [2014] NSWCA 49. 3At the time I determined those applications, I ordered Dr Toben to pay Senator Milne's costs. The Court of Appeal did not disturb that order. It remains to determine an application by Senator Milne made on written submissions for a direction that her costs be assessable forthwith. 4The rules expressly contemplate that the costs of an interlocutory application will ordinarily not become payable until the conclusion of the proceedings. Rule 42.7(2) of the Uniform Civil Procedure Rules provides: (1) Unless the court orders otherwise, the costs of any application or other step in any proceedings, including: (a) costs that are reserved, and (b) costs in respect of any such application or step in respect of which no order as to costs is made, are to be paid and otherwise dealt with in the same way as the general costs of the proceedings. (2) Unless the court orders otherwise, costs referred to in subrule (1) do not become payable until the conclusion of the proceedings. 5The discretion to order otherwise must be exercised with the recognition that it amounts to a departure from the ordinary position under the rules, which is that costs are not assessable until the conclusion of the proceedings. The ordinary position no doubt reflects the Parliament's assessment of a number of considerations relating to the efficient administration of justice and the overriding purpose of achieving the just, quick and cheap determination of the real issues in the proceedings. 6There is good reason to approach the exercise of the power to permit costs to be assessed forthwith with caution. A cost assessor's certificate of assessment can be filed in the Registry so as to take effect as a judgment of the Court and so has the capacity ultimately to be fully enforced prior to the conclusion of the proceedings in which the order was made. The rules reflect a recognition that, in the ordinary case, it will be preferable for any liability to pay an opponent's costs to abide the outcome of the whole proceedings. 7The circumstances in which the court might properly exercise its discretion to order otherwise were the subject of careful consideration by Barrett J in Fiduciary Ltd v Morningstar Research Pty Ltd [2002] NSWSC 432; (2002) 55 NSWLR 1. His Honour identified three recognisable category of case in which courts have departed from the normal rule, noting however that the ultimate determinant as to the exercise of the discretion is the demands of justice. The three categories identified by Barrett J were: 1. cases where the interlocutory application sees the determination of a separately identifiable matter or may be viewed as the completion of a discrete aspect of the proceedings; 2. cases in which there is some unreasonable conduct on the part of the party against whom costs have been ordered; and 3. cases in which there is "much to come" in the proceedings such that it may be undesirable to keep the successful party out of the benefit of the costs order for that lengthy period. 8As noted on behalf of Senator Milne, costs will have been incurred in the present case in respect of three issues which required the attention of the lawyers. First, the amendment was initially prompted by an objection to the manner in which Dr Toben had originally pleaded the element of publication against Senator Milne. The original statement of claim sought to hold her liable for the whole of the content of the newspaper article in question, notwithstanding the fact that she is not the journalist or the proprietor of the newspaper but is a person to whom certain quotes are attributed within the body of the article. Senator Milne moved to have the pleading struck out on that basis, relying on my decision in Dank v Whittaker (No 1) [2013] NSWSC 1062. Dr Toben capitulated to that objection. One of the purposes of the proposed amendment was to re-plead the element of publication. 9Secondly, the central objection to the amended pleading was the inclusion of the new claims for misleading or deceptive conduct and unconscionable conduct. 10Thirdly, the application determined Senator Milne's objections to the imputations pleaded in the original statement of claim. 11I would accept, as submitted on behalf of Senator Milne, that the main focus of the interlocutory application was the claim for misleading or deceptive conduct. It may be accepted that that was a discrete and self-contained issue but it was not the only matter argued. 12I would also accept that there is likely to be some time before the proceedings are finally determined, although it is difficult to know with any precision at this early stage. 13I am not persuaded that those two circumstances of themselves warrant the making of an order that costs be assessed forthwith in the present case. Mr Potter, who appears for Senator Milne, did not point to any unreasonable conduct on the part of Dr Toben. As already noted, leave was refused on the basis that the claim was untenable and could not succeed, but that conclusion was reached after hearing careful argument put on behalf of each party in which it was necessary to consider the number of legal authorities. Failure in a legal argument, even argument on a strikeout application, does not of itself demonstrate unreasonable conduct in opposing the application or seeking to prosecute the claim that has ultimately been held to be untenable. 14For the reasons already explained, I consider that the Court should be careful not to depart too readily from the ordinary position that costs are payable at the conclusion of proceedings. I am not persuaded that this is a case in which the costs of the unsuccessful application for leave to amend should be assessed at any earlier point. For those reasons, the application for an order that costs by payable forthwith is refused.