Karadaghian v Big Beat (Australia) Pty Ltd (No 4) [2014] NSWSC 1872

Supreme Court New South Wales

Medium Neutral Citation: Karadaghian v Big Beat (Australia) Pty Ltd (No 4) [2014] NSWSC 1872 Hearing dates: Written submissions Decision date: 30 December 2014 Before: Rothman J Decision: (1)Order (2) issued on 28 November 2014 in this matter be vacated; (2)The first defendant is to pay the plaintiff's costs of and incidental to the motion, as agreed or assessed. Catchwords: COSTS - Application for disqualification on bias - Application that costs not follow the event - Application refused Legislation Cited: Civil Procedure Act 2005 Category: Costs Parties: Philip Karadaghian (Plaintiff) Big Beat (Australia) Pty Ltd (First Defendant) Ambiant Pty Ltd (Second Defendant) Representation: Counsel: G Masselos (Plaintiff) D Lloyd (First Defendant) Self-represented (Second Defendant) Solicitors: Steve Masselos & Co Solicitors (Plaintiff) Norton Rose Australia (First Defendant) File Number(s): 2010/351104

Judgment 1ROTHMAN J: By motion on notice, the first defendant sought orders that these proceedings be allocated for hearing before a judge other than the judge who has dealt with the interlocutory matters thus far. That application was dismissed. The first defendant now seeks to resist an order that it pay the costs of the plaintiff of and incidental to the motion. 2The Civil Procedure Act 2005 provides that an order that costs follow the event be the ordinary course (as it was prior to the promulgation of the Civil Procedure Act), unless the Court orders otherwise. The discretion reposed in the Court must be exercised by it judicially. 3An order for costs is compensatory, not punitive. It compensates the successful party, at least to some extent, for the need to enforce its rights or to defend its rights. 4Undeniably, the first defendant has sought an order from the Court, which application has been dismissed. If costs were to follow the event, an order would be made that the first defendant should pay the plaintiff's costs. 5The first defendant submits that costs should be costs in the cause, because the application made by it was not unreasonable and was intended to ensure the regularity of the proceedings at trial. As a consequence, the first defendant submits that the appropriate order is that the ultimately successful party should have its costs of the application compensated, rather than the ordinary order for costs on the motion. 6An order that the first defendant pay the plaintiff's costs of the motion would have the effect that the first defendant would be required to pay such costs at the conclusion of the proceedings; and not before the conclusion of the proceedings. If the plaintiff were successful at trial, ordinarily the first defendant would be required to pay the costs of the plaintiff. In those circumstances, the effect of an order that the first defendant pay the plaintiff's costs of this motion would, if the plaintiff were successful in the proceedings, have no different effect than an order that the costs of the motion be costs in the cause. 7On the other hand, if the plaintiff were unsuccessful in the proceedings, there would be a difference in the effect of any such order. In those circumstances, the first defendant's costs of this motion would not be recovered by it from the plaintiff and the plaintiff would deduct his costs of this motion from the amount otherwise to be paid for the costs of the proceedings. 8I accept that the application by the first defendant was one that was reasonably made. However, that is not the test in relation to costs. I also accept that one of the defendants may have been required to make such application, if and when the trial was listed before me (if it were so listed). 9Nevertheless, the first defendant has made the application. The application was unsuccessful. The plaintiff has been put to expense in dealing with the motion before the Court and nothing has been put, which, in my view, would warrant a departure from the ordinary rule that costs should follow the event. In those circumstances it is appropriate that the first defendant pay the plaintiff's costs of and incidental to the motion, whether or not successful in the substantive proceedings. 10I am however mindful of the fact that it is important for justice not only to be done but to be seen to be done and the motion agitated an issue, which the Court may have been required to deal with in any event, in order to ensure the regularity of the proceedings and the appearance of regularity. Even in those circumstances, the plaintiff should not have to bear the first defendant's costs of the motion and the plaintiff should be compensated for his costs of the motion. 11For those reasons, I shall alter the order made on 28 November 2014, such that the Court orders that the first defendant pay the plaintiff's costs of and incidental to the motion, the effect of which is that if the first defendant is ultimately successful, its costs of this motion will not be the subject of compensation by the plaintiff and the plaintiff's costs of this motion will be deducted from any costs order otherwise payable. 12The Court makes the following order: (1)Order (2) issued on 28 November 2014 in this matter be vacated; (2)The first defendant pay the plaintiff's costs of and incidental to the motion, as agreed or assessed.