Court of Appeal Supreme Court New South Wales Medium Neutral Citation: GM Amalgamated Investments (Dulwich Hill) Pty Ltd v Mills [2014] NSWCA 271 Hearing dates: 11 August 2014 Decision date: 11 August 2014 Before: Leeming JA Decision: The amended notice of motion filed 31 July 2014 is dismissed. [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.] Catchwords: PRACTICE AND PROCEDURE - costs - motion by former solicitor seeking relief over fruits of judgment - motion abandoned at hearing - no basis for costs order favourable to former solicitor Legislation Cited: Civil Procedure Act 2005 (NSW), s 98 Supreme Court Act 1970 (NSW), s 46 Cases Cited: AMC Commercial Cleaning (NSW) Pty Ltd v Coade [2013] NSWSC 192 Bernadette Mills v GM Amalgamated Investments (Dulwich Hill) Pty Ltd [2013] NSWSC 519 Ex parte Patience; Makinson v The Minister (1940) 40 SR NSW 96 GM Amalgamated Investments (Dulwich Hill) Pty Ltd v Mills [2014] NSWCA 202 Habib v Radio 2UE Sydney Pty Ltd [2013] NSWCA 347 Re Minister for Immigration and Ethnic Affairs; Ex-parte Lai Qin [1997] HCA 6; 186 CLR 622 Category: Interlocutory applications Parties: Mr Richard Black (Applicant on the Notice of Motion, non-party) Mills Oakley Lawyers (non-party) Representation: Counsel: Mr LD Robison (Mr Richard Black, applicant on the Notice of Motion) Mr S Aroney (Mills Oakley Lawyers, non-party) Solicitors: Mr R Black (applicant on the Notice of Motion) File Number(s): 2013/159286 Decision under appeal Jurisdiction: 9003 Citation: GM Amalgamated Investments (Dulwich Hill) Pty Ltd v Mills [2014] NSWCA 202 Date of Decision: 2014-06-27 00:00:00 Before: Emmett JA; Gleeson JA; Sackville AJA File Number(s): 2013/159286 Judgment 1LEEMING JA: Before me is an amended notice of motion filed 31 July 2014. The applicant, Mr Richard Black, a solicitor, formerly acted for Ms Bernadette Mills in proceedings tried in this Court, and determined favourably to her: see Bernadette Mills v GM Amalgamated Investments (Dulwich Hill) Pty Ltd [2013] NSWSC 519. Mr Black, according to his affidavit, provided legal services to Ms Bernadette Mills in 2008, 2009 and 2010. He says that he has "not been paid a cent" for those services. The trial took place in 2013. The defendants appealed, and their appeal was dismissed: see GM Amalgamated Investments (Dulwich Hill) Pty Ltd v Mills [2014] NSWCA 202. Costs orders followed the event at first instance and on appeal. The solicitors who appeared for Ms Mills, so far as I am aware, at all times from at least 2011 to date (and therefore appeared throughout the trial and on appeal) were Mills Oakley Lawyers. (It is common ground that the similarity between the names of the client and the firm is purely coincidental). 2Pursuant to the judgments at first instance and on appeal, an insurer (AAI Ltd) paid by bank cheque an amount of $116,993.62. That cheque was received by Mills Oakley on 23 July 2014. 3Prior to that time, Mr Black had sought to recover his outstanding fees from Ms Mills. He obtained a certificate of determination of costs from a costs assessor in November 2010, in the amount of $12,826.45, and registered that certificate, which thereafter took effect as a judgment, in the Local Court at Sutherland shortly thereafter. In 2011, he caused writs for the levy of property to be issued in relation to certain property in New South Wales. He has also engaged in correspondence with his former client. Relevantly for present purposes, on 25 October 2012, Ms Mills advised Mr Black of a "verdict" in the litigation (it is not clear on the materials before me what precisely she was referring to), but further said "I will touch base with you at every point". Mr Black expresses the view that, contrary to that email, Ms Mills did not keep him informed. He says that he was not advised that judgment was handed down and costs orders made in favour of his former client. 4I return to the motion before me. It seeks orders that an amount of $19,086.84 be paid directly to Mr Black in satisfaction of the judgment debt created by the registration of the costs assessor's certificate. That amount reflects interest in the amount of $5,011.89 over the period from 15 November 2011 until today. Also in evidence before me are offers made by Ms Mills to pay $10,000, and (on 29 July 2014, shortly after service by email of the motion and affidavit) an amount of $13,000 as full settlement of his claim. 5There is also evidence from Ms Mills that her income is derived from social security benefits and pensions (in the amount of $400 per week), that her house is subject to a loan which she describes as "at 90%", that she has five children and credit card debt of $35,000. 6In her email of 29 July 2014 to Mr Black she said: "We note that we offered you 13k today as full settlement. Considering you did no billable hours on our case and it cost us 8k to have our matter reinstated plus 2k for a cost assessor we feel that this is well and truly over and above what a solicitor would offer you on our behalf. You being a solicitor tell people every day no one wins. You can't recoup all costs thus all professionals in this matter are understanding of that considering we paid out 150k in legal fees. Keep in mind the condition of the property as it requires extensive work. We are four months behind and the loan is at 90% hence you'll get nothing after the bank. This offer will be looked upon should you proceed to Court. I don't think you deserve a dollar, I've offered you 10k, my husband offered you 13k take it or leave it. It's on the table for 24 hours being 5pm Wednesday 30th of July. Then it's back to 10k enjoy racking up court fees that no one can pay." 7It is neither necessary nor appropriate to express any view on the evident dispute between former client and solicitor, aspects of which are evidenced by the passage referred to above. I mention it merely because of its relevance to the basis in respect of which Mr Black asks me to exercise the discretion as to costs in an unusual fashion. For the only question before me is as to costs; it is accepted by Mr Black that the amended notice of motion should be dismissed. 8Notwithstanding that his motion is to be dismissed, Mr Black seeks an order that Ms Mills pay his costs of it. There was evidence that Ms Mills had been served, and was aware of this motion, although she did not appear on it. I interpolate, in light of the material disclosed by his affidavit, coupled with what was said from the bar table by a representative of Mills Oakley who appeared (that firm was described on the amended notice of motion, properly, as a person affected by the orders sought) that that firm did not act for Ms Mills on this motion. There is nothing in the evidence before me to suggest that Ms Mills has incurred any costs in relation to Mr Black's motion. 9For his part, Mr Black acted for himself in relation to filing the notice of motion and swearing his affidavit, although (I would infer more recently), he has retained counsel to appear today before me. 10As I said, Mr Black's application is for Ms Mills to pay his costs of the motion in relation to which he accepts he was unsuccessful. The basis for that application is twofold. First, it is said that there was, to put it neutrally, a statement from Ms Mills that she would keep him informed as to the progress of the litigation in relation to which he had ceased to appear for or act for her. I have reproduced this above. 11Secondly, it is said that prior to the filing of the notice of motion, funds were transmitted from the insurer of Sheraton Homes Pty Limited (a company related to the unsuccessful appellants) to Mills Oakley. He says, had it been known that the insurer had already paid out the amount to Mills Oakley, the motion would never have been brought. 12The motion suffered from some defects, which, entirely properly, were acknowledged during the course of argument. In my view, there is no power under s 46 of the Supreme Court Act 1970 (NSW) for a Judge of Appeal to make the injunctive orders in relation to the fruits of the judgment sought by Mr Black. This is a much clearer case than Habib v Radio 2UE Sydney Pty Ltd [2013] NSWCA 347, where at least, the fruits of judgment reflected the favourable costs order made by the Court of Appeal. 13The chronology referred to above records that Mr Black ceased acting years before the trial and had no involvement in the appeal. He can have no proprietary claim to the costs of the appeal. In relation to the costs at first instance, Mr Black asserts, and for the purposes of this application I accept, that the amount paid by Sheraton Homes' insurer reflects "fruits" derived "at least in part" from his exertions on behalf of the client, and I have been referred to AMC Commercial Cleaning (NSW) Pty Ltd v Coade [2013] NSWSC 192 at [16] in support of that proposition. However it is plain that s 46 of the Supreme Court Act does not authorise a Judge of Appeal to make any order in relation to the fruits of the judgment at first instance. 14Mr Robison points out, correctly, that it would have been open, had the matter been contested, for the Court to take the same approach as occurred in Habib, namely, to refer his application to a Division of this Court. I am conscious, however, that had course been taken, the likelihood is that there would have been costs incurred in this Court. 15A further difficulty, although one which is at least partly addressed by the amended notice of motion, is that if it be accepted (as I do for present purposes) that Mr Black has an entitlement in accordance with the principle stated by Jordan CJ in Ex parte Patience; Makinson v The Minister (1940) 40 SR NSW 96 at 100-102, so too must Mills Oakley. Rather than being merely a person affected by the orders sought by Mr Black, that firm was, in my view, a necessary party to an application involving a claim to an amount of money derived from orders made by the Court in proceedings which at trial and on appeal that firm acted for Ms Mills. 16The discretion to order costs under s 98 of the Civil Procedure Act 2005 (NSW) is, of course, a broad one, and I accept the availability in principle of the course put forward by Mr Black, namely that there be a favourable costs order, notwithstanding the conceded lack of merit in the motion, parts of which were inherent in its filing, other parts of which were obvious by reason of events not disclosed to Mr Black. 17More usually in such cases, either the ordinary rule that costs follow the event will obtain, or, if it be shown that both parties have acted reasonably in commencing the proceedings and thereafter maintaining them, an appropriate exercise of discretion will be that there be no order of costs: cf Re Minister for Immigration and Ethnic Affairs; Ex-parte Lai Qin [1997] HCA 6; 186 CLR 622 at 625. 18The result of this application as to costs will not of itself affect Mr Black's cost certificate, judgment debt or other rights he has to enforce his costs entitlement against Ms Mills. Bearing in mind (having regard in particular to her personal financial circumstances as referred to above) as the likelihood that Ms Mills, herself, has incurred no costs on Mr Black's motion (which after all was filed only in the last three weeks) there is no substantive difference between an order that there be no order for costs and an order that Mr Black pay Ms Mills' costs. That practical consideration means that my exercise of the cost discretion is more straightforward. 19In the circumstances to which I have referred, where, taking the view most favourably to Mr Black, there was non-communication by Ms Mills to her former solicitor, but there were, in addition, at all times significant difficulties in the course he chose to adopt, there is not a sound basis for an exercise of a cost discretion favourable to him following his acceptance that the notice of motion should be dismissed. 20To summarise: by reason of the practical reality that the costs of Ms Mills on this motion are either zero or very small, it suffices to hold that Mr Black is not entitled to an order, in the exercise of my discretion as to costs, more favourable than that the motion be dismissed with no order as to costs, with the intention that each party bear his or her own costs. 21Accordingly the orders of the Court are: (1) Amended notice of motion filed 31 July 2014 dismissed. 22The exhibits will be returned. Is there anything else that arises? ROBISON: No your Honour. ARONEY: No your Honour. ********** 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: 18 August 2014