Dentown Pty Limited v PWI Group Pty Limited

The plaintiffs and the second to fifth defendants (hereafter referred to as “the defendants”) are in dispute concerning the costs of certain interlocutory proceedings. Those proceedings involved:

The proceedings came before me as Duty Judge on 26 April 2016. On that occasion, the defendants were directed to serve evidence by 29 April 2016, and the proceedings were adjourned to 2 May 2016 before me. The defendants had not served any evidence by 2 May 2016. On that day, directions were made for the filing of a motion and affidavits by the defendants, and the proceedings were further adjourned to 5 May 2016 before me.

On 3 May 2016 the defendants filed the motion, referred to earlier, as well as two substantial affidavits. On 4 May 2016 the plaintiffs re-listed the matter before me, primarily in relation to the time needed to respond to the defendants’ evidence. The hearing of the defendants’ motion, save for the aspect concerning the restraints sought against the plaintiffs, was confirmed for the following day.

On 5 May 2016 there was a contested hearing concerning the freezing orders, which the plaintiffs wanted continued, and the alternative interlocutory regime advanced by the defendants. That regime involved the giving of various undertakings. After being taken through the relevant evidence and receiving lengthy submissions, I indicated that a regime along the lines of that proposed by the defendants would be preferable to a continuation of the existing freezing orders. Following further discussion between Bench and Bar, and between the respective parties, orders were made setting aside the freezing orders and establishing a fresh interlocutory regime involving the giving of various undertakings by the second and third defendants.

The balance of the defendants’ motion, concerning the restraints sought against the plaintiffs, was adjourned to 11 May 2016. On that occasion, upon the plaintiffs providing certain undertakings, consent orders were made by Sackar J for the withdrawal and discontinuance of that aspect of the motion. His Honour also made an order to the effect that the costs of the defendants’ motion be dealt with by me.

The parties have provided detailed written submissions and evidence on the question of costs. The submissions concern not only the costs of the defendants’ motion, but also some or all of the costs of the plaintiffs’ application for freezing orders. It appears that the parties are content for the costs of the freezing order application, at least insofar as the appearances on 2, 4, 5 and 11 May 2016 are concerned, to be dealt with by me. The plaintiffs take the view that the costs of the application for freezing orders should otherwise await the final hearing. The parties agree that the costs issues may be dealt with on the papers.

The plaintiffs take a fragmented approach. They seek an order for costs in respect of the appearances on 2, 4 and 11 May 2016, and an order in respect of this costs argument. The plaintiffs submit that the costs of 5 May 2016 should remain reserved or be costs in the cause. The plaintiffs further submit that the costs of the defendants’ motion concerning the discharge of the freezing orders and the alternative interlocutory regime should be costs in the cause and that the defendants should pay the costs of the balance of the motion.

The defendants seek an order for costs of the application for freezing orders, and of their motion insofar as it concerns the discharge of those orders and the alternative interlocutory regime. The defendants submit, in relation to the balance of the motion, that each party should bear its own costs.

In my opinion, whilst it is possible to identify particular occasions or aspects of the proceedings where one or other party may be considered the successful party, or occasions where a party has caused or contributed to an adjournment, it is appropriate to take a broader view of the proceedings to date.

In essence, the plaintiffs sought urgent interlocutory relief, they were successful in obtaining, initially ex parte, extensive freezing orders. The defendants were then successful, over the opposition of the plaintiffs, in having those orders replaced with an alternative interlocutory regime which the Court considered to be preferable. The defendants did not succeed in obtaining restraints against the plaintiffs as sought, but the plaintiffs saw fit to offer more limited undertakings, which were ultimately accepted by the defendants.

There is a degree of success and failure on both sides. In my view, it is not a case where either party can truly claim to have won “the event”. In all the circumstances, including that some of the evidence adduced will be relevant to the final determination of the issues between the parties, it seems to me that the costs incurred by the parties on the defendants’ motion and on the freezing order application (at least insofar as the appearances on 2, 4 and 5 May 2016 are concerned) should be treated as costs in the cause. That means that if a party is ultimately successful it will, at least prima facie, be entitled to recover such costs from the unsuccessful party. The remaining costs of the freezing order application will be treated as reserved given that there is no agreement that I deal with such costs. I observe, however, that there is much to be said for the view that those costs should also be treated as costs in the cause. As for the costs of this application, it is my view that as neither side can be considered to have clearly prevailed over the other, it is appropriate that each party bear its own costs.

The Court orders that: