Supreme Court New South Wales Medium Neutral Citation: Pupo v Pupo (No 2) [2015] NSWSC 1647 Hearing dates: 6 November 2015 Date of orders: 06 November 2015 Decision date: 06 November 2015 Jurisdiction: Equity Before: Hallen J Decision: Order that the Plaintiffs are to bear the Defendants' costs of the proceedings, as to 80 per cent, by the first Plaintiff, and as to 20 per cent, by the second Plaintiff. Catchwords: PROCEDURE – Costs – General rule costs follow the event – Whether there should be an apportionment of the Defendants' costs between unsuccessful Plaintiffs – Some commonality of evidence but no real commonality of issues in the cases Legislation Cited: Civil Procedure Act 2005 (NSW) Property (Relationships) Act 1984 (NSW) Cases Cited: Perigo v Workers Compensation Nominal Insurer (No 3) [2013] NSWSC 6 Pupo v Pupo [2015] NSWSC 1633 Thiess Watkins White Construction Limited (in liq) v Witan Nominees (1985) Pty Ltd (1992) 2 Qd R 452 Category: Costs Parties: Saverio Pupo (first Plaintiff) Rosetta Pupo (second Plaintiff) Sammy Ferdinando Pupo (first Defendant) Rosemaria Pupo (second Defendant) Giuseppe Pupo (third Defendant) Representation: Counsel: Mr G Gemmell (Plaintiffs) Mr G Carolan (first and second Defendants) Mr R Brender (third Defendant) Solicitors: Pelosi & Associates (Plaintiffs) Kazi Portolesi Lawyers (first and second Defendants) Bransgroves Lawyers (third Defendant) File Number(s): 2014/264225 Judgment – EX TEMPORE (REVISED) 1. HIS HONOUR: This morning, I delivered reasons for judgment ("the principal judgment") dealing with proceedings that, relevantly, were commenced by Saverio and Rosetta Pupo against two of their four children, Sam and Giuseppe, and against their daughter-in-law, Rosa, the wife of Sam. The medium neutral citation of those reasons is Pupo v Pupo [2015] NSWSC 1633. Names, events, matters and things are referred to in the same way as they are in the principal judgment. 2. In the proceedings, which occupied 5 hearing days, I determined that the whole of the Statement of Claim should be dismissed. Because I was requested not to deal with costs in the principal judgment, now, the question of how the burden of costs should be borne (by the Plaintiffs) has been the subject of oral submissions which were made immediately following the principal judgment being published. 3. On that question, the parties were not in dispute that the usual order for costs should be made, that is to say that the Plaintiffs should pay the Defendants' costs of the proceedings, such costs to be calculated on the ordinary basis. The sole issue for determination relates to the proportion of the Defendants' costs to be borne by each Plaintiff, it being submitted, by their counsel, that Saverio should pay 80 per cent, and Rosetta, 20 per cent, of the Defendants' costs. (In this regard, proportions based on mathematical precision are illusory, and the parties' acceptance of these percentages, overall, seems to be reasonable in the circumstances.) 4. I took the basis for the Plaintiffs' application to mean that the parties accepted that there were two "issues", one relating to Saverio's claim, and the other relating to Rosetta and Saverio's claim. Saverio, alone, had sought relief, the effect of which, had he been successful, would have provided him with an interest in the Leichhardt property. Rosetta and Saverio, together, did not make a similar claim to an interest in the Leichhardt property as a result of events that surrounded its purchase by Sam, Giuseppe and another son of the Plaintiffs, Frank, in 1990. Rather, they sought an adjustment of property rights based upon the Property (Relationships) Act 1984 (NSW) upon the basis of what they asserted were their contributions to the acquisition, conservation or improvement of the Leichhardt property and to the welfare of Sam, Rosa and their children. There was some, but not very much, commonality of evidence, in respect of both issues. The issues, themselves, were quite distinct. 5. Theoretically, if not practically, it would have been possible for the proceedings by Rosetta and Saverio under the Property (Relationships) Act to have been commenced, and conducted, separately. 6. Counsel for Sam and Rosa, two of the three Defendants, submitted that there should be no differentiation between the Plaintiffs and that the usual costs order should be made against them jointly and severally. No doubt, this submission was based upon an aspect of what is described as "the indemnity costs rule", namely, that, generally, in multiple-party litigation, an order that costs be paid by two, or more, parties to the litigation should create a joint and several liability for the payment of those costs: Thiess Watkins White Construction Limited (in liq) v Witan Nominees (1985) Pty Ltd (1992) 2 Qd R 452, at 453-454; Perigo v Workers Compensation Nominal Insurer (No 3) [2013] NSWSC 6, per McCallum J, at [3]. 7. Giuseppe, the third Defendant, whilst, somewhat surprisingly, seeking costs, did not make any submissions in support of one party, or the other, on the question of apportionment. 8. In support of the submission made on behalf of Sam and Rosa, Mr Carolan of counsel read, over objection (on the ground of relevance), a copy affidavit of John Bui, sworn 12 August 2014, to which was annexed correspondence passing between solicitors prior to the commencement of the proceedings. 9. In the correspondence annexed to that affidavit, Rosetta had asserted, more than once, that she, with Giuseppe and Antonio, "have an undisputable [sic] right to remain in occupation of the [Leichhardt] property for the rest of their lives, if they so desire, free of any rent or occupation fee". 10. In addition, it was asserted on behalf of Rosetta, that "Saverio Pupo was not paid for his equity in the property, but rather, and in lieu of such payment, it was agreed between Saverio, Rosetta and their children, Guiseppe [sic], Frank and Sam, that Saverio and Rosetta would be granted a right to remain in occupation [of the Leichhardt property] for the duration of their lives, free of rent or occupation fee." 11. In later correspondence, dated 1 August 2014, it was asserted that: "...when the property was transferred in about 1990, Saverio Pupo was not paid for his equity in the property. This claim is asserted, by Saverio and Rosetta Pupo and supported by Giuseppe Pupo." 1. Then, it was asserted that an agreement had been reached to the effect that Saverio and Rosetta would be granted a right to remain in occupation of the Leichhardt property for the duration of their lives, free of rent or occupation fee, and that this claim was asserted by Saverio and Rosetta, and supported by Giuseppe. 2. Otherwise, no party read, or tendered, any other evidence on the issue of how the burden of costs should be borne. Determination 1. The trust proceedings were not commenced until September 2014. All of the correspondence relied upon, a copy of which was annexed to Mr Bui's affidavit, was written prior to the commencement of the proceedings. When those proceedings were commenced, any assertion of an agreement giving rise to the entitlement to remain in occupation of the Leichhardt property was abandoned, and there was no reference to the previous allegations made on behalf of Rosetta. 2. Also, as I stated in the principal judgment, there was no claim by Saverio and/or Rosetta based upon an equitable estoppel. 3. Accordingly, in my view, Rosetta's involvement in Saverio's claim, so far as it related to an interest in the Leichhardt property, was as a witness who gave evidence of facts which were said to support that claim, no part of which claim involved an entitlement to remain in occupation for life, or for some lesser period, of the Leichhardt property. 4. Otherwise Rosetta's involvement in the proceedings was limited to her claim, with Saverio, for an adjustment order under the Property (Relationships) Act. 5. Counsel for Sam and Rosa submitted, bearing in mind evidence read in the proceedings, which evidence related to the financial and material circumstances of Saverio, and of Rosetta, that if an order were made as sought by the Plaintiffs, the effect would be that Sam and Rosa would be likely to only recover 20 per cent of their costs from Rosetta, as Saverio had no assets, or other property, from which his share of the costs ordered to be paid, could be satisfied. 6. It seems to me that that this is not the most relevant consideration in the determination of the question by whom costs are to be paid. As stated earlier, had separate proceedings been commenced, the situation in which Sam and Rosa find themselves, probably, would not be substantially different. 7. More important, it seems to me, is a consideration of the time devoted to the presentation of the respective parts of the case of the Plaintiffs. There was no dispute that the proportion of time devoted to the preparation for, and the hearing of, Saverio's part of the case, was about 80 per cent, and that the time devoted to the preparation for, and the hearing of, Rosetta's and Saverio's case, was about 20 per cent. The issue raised by Saverio alone, clearly was the dominant, and separable, issue. 8. There was no dispute, also, that the court has full power to determine by whom, to whom, and to what extent, costs are to be paid or that a party to proceedings may not recover costs from any other party otherwise than pursuant to an order of the Court: s 98 of the Civil Procedure Act 2005 (NSW). The rule confers a broad discretion which must be exercised judicially in accordance with established principle and factors directly connected with the litigation. 9. Having considered the way with which the proceedings were dealt, the evidence read on this application, and the submissions, I am of the view that it would be unjust to impose joint and several liability, for costs, amongst the two Plaintiffs. This is a case where that general rule should be disturbed because one Plaintiff brought a separate and distinct case which incurred costs which cannot be attributed to the conduct of the other Plaintiff. 10. One can test the conclusion in this way. Had Rosetta and Saverio succeeded in their claim, but Saverio had failed in his, "the issue" in respect of an award of costs in their favour would relate to the part of the proceedings that concerned them. Saverio could not have expected, realistically, to receive an order for costs that covered all of his costs in respect of his claim, and Sam and Rosa would not reasonably expect to have to pay those costs. 11. In all of the circumstances of this case, I am of the view that the orders sought by the Plaintiffs should be made. There is good reason to depart from the usual requirement that the Plaintiffs' liability for costs should be joint and several. 12. Accordingly, I order that the Plaintiffs are to bear the Defendants' costs of the proceedings, as to 80 per cent, by the first Plaintiff, and as to 20 per cent, by the second Plaintiff. ********** 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: 09 November 2015