Kossaifi v ACN 111 804 383 Pty Ltd

HIS HONOUR: On 24 November 2015, in the course of delivering my judgment on a show cause application, I made orders including an order that the plaintiffs pay the defendants’ costs of the proceedings to date: see Kossaifi v ACN 111 804 383 Pty Ltd [2015] NSWSC 1743.

The plaintiffs have now moved the Court for a variation of that order in these terms:

The plaintiffs maintain that I should make the varied costs order in accordance with UCPR 36.17, which provides as follows:

In support of that application, counsel for the plaintiffs has drawn my attention to a remark passed by me in a discussion with him during the original application when I said this concerning the plaintiffs’ potential liability for costs:

The plaintiffs perceive that I had intended by that remark to indicate that they would necessarily be liable for wasted costs, to the extent that their conduct in the litigation to that time had generated any, as the price of resisting an order that the proceedings be dismissed. That perception was accurate.

Senior counsel for the defendants opposes the variation with a vehemence that seems to me to be disproportionate to the matter at hand. He contends that a comparison between my order and the comment does not reveal or suggest that I made a slip or otherwise proceeded in a way that is amenable to correction in accordance with the rule. I disagree.

Part of the defendants’ argument suggested that my use of the expression “costs thrown away or occasioned” was in fact a statement of alternatives, and that in the events that have occurred my order suggests in terms that I had proceeded to order that the plaintiffs pay the costs “occasioned” by the proceedings up until that time. In my experience the expression is, and has always been, intended to convey a concept referring to wasted costs referable to some specified event or course of conduct. That is how I intended to use it.

The defendants also contend that there is no slip to which the rule applies in any event. I also disagree with that contention. I accept that the rule applies generally to matters upon which no real difference of opinion can exist. It can apply even if there are different possible “corrections”, provided that the choice between them does not involve a matter of controversy or substance or require the exercise of an independent discretion. The error does not in my view involve a matter of controversy or substance or require the exercise of an independent discretion. The error is in my view one, if it had been drawn to the attention of the parties at the relevant time, which would have been corrected as a matter of course.

I intended when ordering the plaintiffs to pay the defendants’ costs to limit my order in the way now proposed by the plaintiffs. My original order was incorrect and should be altered to reflect my intention. There can be no suggestion that the plaintiffs could have become liable for other than wasted costs in the events that have occurred. The position would, or may, have been different if I had acceded to the defendants’ submission that the proceedings be dismissed. That did not occur.

I note that the defendants have suggested that the proposed order will or may cause unreasonable confusion for any person called upon to assess the costs or to discern what costs were and what costs were not wasted costs in the circumstances. As sympathetic as I am to the assessor’s often difficult task, the singular prospect that it may be difficult to discern how my order should be implemented does not reliably or persuasively inform the inevitability of any different conclusion on my part.

Finally, I note that the difference between the amount of costs payable under either order is likely to be small. That does not mean that the plaintiffs were wrong for seeking a correction or that the defendants were wrong for opposing it. This case, however, has unfortunately generated what appears to me to be a considerable amount of heat, which I am hopeful will be replaced by light as the matter proceeds.

In the circumstances I will make the following orders: