Lukac v Kassis (Final orders and costs)

On 25 February 2026 I delivered the principal judgment: Lukac v Kassis [2026] NSWSC 120. At paragraph [52] I ordered that there be judgment respectively for the first plaintiff and the second plaintiff in stated money amounts, together with pre-judgment interest. In paragraph [54] I said that I would hear the parties on costs and on any remaining issues or arithmetical adjustments. I directed the parties to confer. They did. They have agreed as to the amounts of the judgments (including pre-judgment interest). The consequence is that the final judgments will be:

The parties are at odds about costs. I received written submissions from both sides.

It is appropriate to deal with the defendants’ position first. The defendants say that:

UCPR r 42.34 provides:

The plaintiffs for their part argue, relying on s 8(b) of the Interpretation Act 1987 (NSW), that UCPR r 42.34(1)(a) does not apply because where it refers to plaintiff this should be construed as including the plural and, together the plaintiffs met the $500,000 threshold. They argue that, if it does apply, in any event the trust case they brought, even though it failed, could not have been commenced in the District Court. They argue that the matter involves sufficient complexity to warrant its being brought and maintained in this Court.

Whether or not UCPR r 42.34(1) is enlivened where two plaintiffs in one proceeding each achieve an individual judgment of less than $500,000 but a combined total of more, is not necessary to decide here. In my opinion, although these were individual claims they were properly brought together because of their common factual substratum which included, but was not restricted to, the Courtenay House Ponzi scheme. The conduct they each complained of bore a striking similarity and, in the end, the substance of their respective complaints was not contested. The substance of the matter is that the moving parties met the $500,000 threshold. It is not necessary to deal with the plaintiffs’ other contentions as to why they were justified in coming to this Court. It is apt to observe, however, that the plaintiffs would have been entitled to their costs had they each sued separately in the District Court and achieved what they have done in this case. Here the defendants have been the beneficiary of the obvious economies that were achieved by the plaintiffs suing together, there being one set of pleadings, their cases being heard together and being represented by only one set of solicitors and counsel.

The defendants put that the plaintiffs should pay 50% of their costs because the plaintiffs maintained, until late in the piece, a fraudulent concealment case. They observe that this was an extremely serious allegation of fraudulent involvement in a Ponzi scheme where its main architect received a lengthy sentence of imprisonment. They argue that a considerable portion of the defendants’ evidence was specifically directed at refuting this assertion and a significant proportion of their opening submissions were necessarily prepared prior to the plaintiffs’ belated abandonment of the fraudulent concealment case.

I think there is some substance in this contention and that some allowance should be made for it in the defendants’ favour, although ordinarily the Court does not determine costs by reference to issues that failed and issues that succeeded. The appropriate allowance plainly does not extend to an order that the plaintiffs pay any of the defendants’ costs given the defendants’ wholesale loss of the case, and that they fought on anyway even after the fraudulent concealment case was given away. It is difficult to see precisely what endeavours would have been required by the defendants in connection with the fraudulent concealment claim in addition to those which they made in any event. But that having been said, I still think a reduction is warranted because a serious claim was entirely abandoned before the hearing began. Taking a rough and ready approach, as I must, I consider that the plaintiffs’ costs should be reduced by 10%.

The defendants should pay 90% of the plaintiffs’ costs as agreed or assessed.

The following are the final orders of the Court: