Supreme Court New South Wales Medium Neutral Citation: Rixon v Horseshoe Pastoral Co Pty Ltd (Costs) [2018] NSWSC 1500 Hearing dates: Written submissions Date of orders: 09 October 2018 Decision date: 09 October 2018 Jurisdiction: Equity Before: Brereton J Decision: Decline to vary costs order to indemnity basis Catchwords: COSTS – where defendant ordered to pay plaintiff's costs – whether order should be varied to indemnity basis – where Calderbank offer made – where outcome more favourable to unsuccessful defendant than judgment but one which court would not have imposed – where case on which plaintiff succeeded emerged at trial – where plaintiff failed on not insignificant issue – held, justice of case did not warrant indemnity costs order Category: Costs Parties: Susan Margaret Rixon (plaintiff) Horseshoe Pastoral Co Pty Ltd (defendant) Representation: Counsel: M. J. Heath (plaintiff) A. Rogers (defendant) Solicitors: BHM Lawyers (plaintiff) Carmody & Associates (defendant) File Number(s): 2015/094229 Judgment 1. In a judgment delivered on 26 September 2017, [1] I: 1. declared that the plaintiff is entitled to an equitable right of carriageway (as defined in (NSW) Conveyancing Act 1919, Sch 8), burdening Lot 130 in DP755902 and appurtenant to Lot 5 in DP835976, over the gravel access track as depicted in the plan prepared by Conway Burrows + Hancock dated 24 August 2015, being exhibit PX11 in the proceedings, save that the easement is 4 metres and not 10 metres in width; 2. ordered that the defendant do all things and execute all documents, in registrable form, necessary to transfer to the plaintiff, at the plaintiff's cost, an easement in accordance with the declaration in par 1; 3. ordered that there be liberty to apply in the event of any difficulty arising in the implementation of order 2; 4. ordered that the defendant be permanently restrained from interfering with or obstructing the use by the plaintiff and those authorised by her of the said easement; and 5. ordered that the defendant pay the plaintiff's costs (reserving liberty to either party to apply for a special or different costs order, by written submission within seven days, any response to be lodged within a further seven days). 1. A (purported) appeal, and application for leave to appeal, was dismissed by the Court of Appeal on 8 June 2018. [2] 2. By written submission made on 3 October, the plaintiff applied, pursuant to the liberty reserved, for order 5 to be varied to provide that the defendant pay the plaintiff's costs on the party/party basis up to and including 1 September 2015, and on the indemnity basis on and from 2 September 2015. The application was supported by an affidavit of the plaintiff's solicitor sworn on 3 October 2017, which annexed: 1. a letter dated 1 September 2015 from the plaintiff's solicitors to the defendant's solicitors, which was stated to be "without prejudice save as to costs", and which proposed that the parties cooperate in making an application to open the Queen Street access, and in creating an easement along and adjacent to the boundary fence on the eastern boundary of Lot 130 from Queen Street to the existing gate (essentially, Access Option 1 referred to in the principal judgment), with compensation to be determined by the average of two valuations; 2. a response dated 14 September 2015, which in substance agreed with the proposal, but insisted that the plaintiff pay the defendant's costs of the proceedings; 3. a letter dated 6 October 2015 from the plaintiff's solicitors to the defendant's solicitors, again stated to be "without prejudice save as to costs", which broadly accepted the defendant's proposal, but varied the alignment of the proposed easement at the northern end, to facilitate practical access, by "splaying" the corner (essentially, Access Option 2 referred to in the principal judgment); 4. a letter dated 15 October 2015 from the plaintiff's solicitors to the defendant's solicitors, which foreshadowed a draft illustration of the location of the proposed easement; and 5. two plans dated 19 October 2015 entitled "driveway concept", one depicting Access Option 1 and the other Access Option 2. 1. The defendant would not accept the "splayed" corner in Access Option 2, insisting on an easement only along the alignment of the boundary in accordance with Access Option 1. 2. For the plaintiff, it was submitted that the proposal contained in the letter of 1 September 2015 was ultimately not accepted by the defendant and would have been more beneficial to the defendant than the ultimate result. 3. In the principal judgment, I indicated that had (NSW) Conveyancing Act 1919, s 88K, been engaged, I would have favoured Access Option 1: [108] Were I wrong about the question of "reasonably necessary", I would have concluded that an easement utilising Option 7 (Access Option 1) was to be preferred, on the basis that it involved the minimum disruption to the defendant's land consistent with providing practical access over Lot 130 to Lot 5. I do not regard Option 5 (the Cemetery) as a practical alternative, due to the environmental constraints which are likely to inhibit it, and because it would not meet SISD requirements. Although Option 8 (Access Option 2) would reduce the scale of earthworks, as compared to Option 7, the evidence does not establish that Option 7 would not be approved. Its impact on Lot 130 would be slight, and it would not preclude any reasonable development or use of Lot 130 1. So far as the evidence and submissions reveal, the defendant was content to accept Access Option 1. The Court would not have imposed Access Option 2. It is true that Access Option 2 may have been less detrimental to the defendant than the ultimate result. However, it is not a result that the Court would have required the defendant to accept. 2. Moreover, as the defendant submitted, the case on which the plaintiff ultimately succeeded was one which was at least clarified, if not first raised, by amendment during the trial. While the case on which Mrs Rixon succeeded was, as it seemed to me, self-evident at least after the view, and was one which, as the Court of Appeal held, was "within the scope of the pleadings" [3] and "fought at trial", [4] it was formalised if not first raised by amendment during the trial, and depended on evidence which Mrs Rixon had not given in her affidavits but was adduced orally only at trial. [5] 3. Further, the plaintiff failed on a number of issues: namely that she had an easement by implied grant, of necessity or pursuant to Wheeldon v Burrows; and that an easement ought to be imposed under (NSW) Conveyancing Act 1919, s 88K. While the implied grant issue added little to the cost of the case, not insignificant costs were associated with the s 88K application, to which a significant portion of the evidence adduced was directed. 4. Having regard to the considerations that the offer which the plaintiff submits that the defendant ought to have accepted was not a formal offer of compromise under the rules, and provided a result which the court would not have imposed; that the case on which the plaintiff ultimately succeeded emerged, at least in its full detail, only at trial; and that the plaintiff failed on a number of issues, at least one of which involved not insignificant costs, I do not consider that the justice of the case warrants an indemnity costs order. 5. I therefore decline to vary the costs order made on 26 September 2017. ********** Endnotes 1. Rixon v Horseshoe Pastoral Co Pty Ltd [2017] NSWSC 1293. 2. Horseshoe Pastoral Co Pty Ltd v Rixon [2018] NSWCA 121. 3. Horseshoe Pastoral Co Pty Ltd v Rixon [2018] NSWCA 121 at [26]. 4. Horseshoe Pastoral Co Pty Ltd v Rixon [2018] NSWCA 121 at [28]. 5. Rixon v Horseshoe Pastoral Co Pty Ltd [2017] NSWSC 1293 at [61]. Amendments 11 October 2018 - coversheet - corrected date of orders and decision 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: 11 October 2018