Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Goater v Commonwealth Bank of Australia (No 2) [2014] NSWCA 412 Hearing dates: On the papers Decision date: 05 December 2014 Before: Basten JA at [1]; Gleeson JA at [10]; Sackville AJA at [11] Decision: (1) Dismiss the notice of motion filed 20 November 2014. (2) The applicants must pay the Bank's costs of the motion. [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: COSTS - appeal - application for indemnity costs - whether conduct of respondent prior to the default judgment justified order for indemnity costs of the appeal - whether conduct of unsuccessful respondent to appeal justified indemnity costs order PRACTICE AND PROCEDURE - appeal - default judgment set aside on appeal - request that Court make orders in respect of proceedings in the Common Law Division - Uniform Civil Procedure Rules 2005 (NSW), rr 9.1, 14.3 and 36.16 Cases Cited: Botany Municipal Council v Secretary, Department of Arts, Sport, Environment, Tourism and Territories (1992) 34 FCR 412 Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 88 ALR 397 Goater v Commonwealth Bank of Australia [2014] NSWCA 382 Harrison v Schipp [2001] NSWCA 13 NMFM Property Pty Ltd v Citibank Ltd (No 2) [2001] FCA 480; 109 FCR 77 Category: Procedural and other rulings Parties: Shirley Goater (First Applicant) Terrence Goater (Second Applicant) Commonwealth Bank of Australia (Respondent) Representation: Counsel: Mr N Hill (Solicitor) (Applicants) Mr AC Casselden/Ms N Dewan (Respondent) Solicitors: Australegal (Applicants) Gadens (Respondent) File Number(s): CA 2014/182391 Decision under appeal Jurisdiction: 9111 Citation: Commonwealth Bank of Australia v Goater [2014] NSWSC 652 Date of Decision: 2014-05-22 00:00:00 Before: Davies J File Number(s): SC 2012/332699 Judgment 1BASTEN JA: On 7 November 2014 the Court, on the application of Mr and Mrs Goater, set aside a default judgment obtained by the Commonwealth Bank of Australia in the Common Law Division: Goater v Commonwealth Bank of Australia [2014] NSWCA 382. The Bank was ordered to pay the applicants' costs in this Court. Further, the applicants were granted liberty to apply to the Registrar if further interlocutory orders were required. 2On 20 November 2014 the applicants filed a notice of motion seeking the following orders: "1. That the costs order in favour of the Applicants made by the Court of Appeal on 7 November 2014 be varied under and in accordance with UCPR 36.16(3A) to the effect that the Respondent pays the Applicants' costs on an indemnity basis; and, 2. That, in accordance with UCPR 9.1 and 14.3, the Applicants have leave to file a defence and cross claim in the Proceedings below within 28 days." 3It is convenient to deal first with the second order. The default judgment having been set aside, further steps in the proceedings will need to be taken in the Common Law Division. It is no part of this Court's function, having disposed of the appeal, to make orders with respect to those further steps in the Division. The intention of the grant of leave was to allow the applicants to seek further orders consequential upon the orders made in this Court. 4Furthermore, the request for orders with respect to pleadings was premature. As noted in the Bank's letter of November (annexed to the affidavit of the applicants' solicitor), the Bank is seeking to amend its pleadings. Appropriate directions will no doubt be given in due course. 5With respect to the application to vary the costs order, the solicitor for the applicants set out in his affidavit the history of the dispute from the time the Bank filed its original statement of claim in October 2012 through to the judgment in this Court. The affidavit annexed a letter sent by the applicants' solicitor to the solicitors for the Bank dated 14 November 2014. The letter set out aspects of the Bank's conduct which, it was submitted, indicated a failure to act "reasonably and fairly" and to be "candid with the Court in connection with this application for default judgment and the issue of the writ of possession". Absent that conduct, the solicitor contended, the application to set aside the default judgment and the subsequent appeal would have been unnecessary. 6Nearly all of the matters raised involved the actions of the parties prior to and culminating in the default judgment. There was no significant complaint about the conduct of the Bank in the appeal proceedings. 7Furthermore, the complaints about the Bank's conduct gave no consideration to the consequences of delay and procedural default on the part of the applicants. Finally, many of the matters said to constitute unfair or unreasonable conduct, or lack of candour, were contestable and were not resolved by the proceedings in this Court. 8The claim for indemnity costs was not based upon any offer of compromise and must have been intended to call in aid the principles identified in cases such as Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397 (Woodward J); Botany Municipal Council v Secretary, Department of Arts, Sport, The Environment, Tourism and Territories (1992) 34 FCR 412 (Gummow J) (opposing party's conduct ethically or morally delinquent); Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 (Sheppard J); Harrison v Schipp [2001] NSWCA 13 (Giles JA); and NMFM Property Pty Ltd v Citibank Ltd (No 2) [2001] FCA 480; 109 FCR 77 (Lindgren J). However, if any such conduct were to be identified, it did not occur in the course of the proceedings in this Court and would therefore affect any order for costs to be made in the Common Law Division. This Court has not purported to make orders as to the costs of the proceedings in the Common Law Division, nor should it. Those costs will be dealt with in the course of the further proceedings in the Division. 9Both the orders sought in the notice of motion should be refused. The notice of motion must be dismissed; the applicants must pay the Bank's costs of the motion. 10GLEESON JA: I agree with Basten JA. 11SACKVILLE AJA: I agree with Basten JA. ********** 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: 05 December 2014