Spencer v Burton[2015] QCA 145

SUPREME COURT OF QUEENSLAND

1. HOLMES JA:  I agree with the reasons of Ann Lyons J and the orders she proposes.
2. GOTTERSON JA:  I agree with the orders proposed by Ann Lyons J and with the reasons given by her Honour.
3. ANN LYONS J: Background On 16 June 2015, this Court allowed the appellant’s appeal.  The judgment and declarations made by the trial judge on 23 June 2014 were set aside and the matter was remitted to the trial division for determination by a different judge.^[1]  The respondent’s application to adduce further evidence and notice of contention were refused.^[2]
4. The parties were given leave to file submissions on costs within 14 days of the date of delivery of the judgment.^[3]  Those submissions have now been received.
5. The learned trial judge made no orders as to costs of the initial trial.  After lodging a Notice of Appeal, the appellant had been required to pay the sum of $10,000 as security for costs pursuant to an order of Gotterson JA dated 21 August 2014.^[4]  It was further ordered that the costs of the security for costs application be the parties’ costs of the appeal.^[5]

Submissions on costs of the appeal

6. The appellant submits that, as the successful party to the appeal, they are entitled to an award of costs in their favour on the standard basis in accordance with r 681 and r 766(1)(d) of the Uniform Civil Procedure Rules 1999 (Qld), unless the Court considers that some other order is more appropriate.^[6]
7. The appellant also argues that they have been successful in this appeal in establishing that the primary judge failed to come to terms with the evidence at trial and erred in the application of the indicia set out in section 32DA of the Acts Interpretation Act 1954 (Qld).  Accordingly, the appellant argues that the appropriate order is for the respondent to pay the appellant’s costs of and incidental to the appeal, including the costs of and incidental to the security for costs application, the application to adduce further evidence and the notice of contention, to be assessed on the standard basis.  The appellant further argues that there are no grounds to depart from the usual order.
8. The respondent does not oppose an order that the respondent pay the appellant’s costs of the appeal and notice of contention, but argues that such an order be limited to the amount of the indemnity (that is, $15,000) prescribed in s 14(1) of the Appeal Costs Fund Regulation 2010 (Qld).^[7]  The respondent also seeks an order granting an indemnity certificate pursuant to s 15(1) of the Appeal Costs Fund Act 1973 (Qld).
9. The appellant argues that there is no basis for limiting the respondent’s obligation to pay costs to the limit of the indemnity.

Submissions on costs order of the first trial

10. At trial, the primary judge was not satisfied that the appellant was a de facto partner of Sharon Burton (the deceased) and on 23 June 2014 the primary judge revoked the Letters of Administration on Intestacy which had been granted to the appellant and granted replacement Letters of Administration on Intestacy to the respondent in relation to the deceased’s estate.
11. In relation to the costs of the first trial which took place in July 2013, the respondent submits that it would be unjust to order the respondent to pay the appellant’s costs of the first trial if she is unsuccessful upon the re-trial and seeks that the order of the primary judge that each party bear their own costs of the trial remain or, alternatively, that the costs of the first trial be in the discretion of the trial judge upon the re-trial.
12. The appellant submits that the order that each party’s costs of the first trial be that party’s costs in the re-trial does not prevent the respondent from seeking an alternative costs order after the matter has been determined by a different trial judge.
13. The respondent also argues that because the respondent’s conduct and submissions at trial did not contribute to the errors of the learned trial judge, it would be unfair to impose the cost burden of the appeal and the re-trial upon the respondent.  The appellant did not make any submissions on this matter.
14. The respondent submits that the unusual circumstances of this matter, which include the appellant’s impecuniosity^[8] and the finding of contempt in relation to his conduct of the deceased’s estate,^[9] should be taken into consideration with respect to the determination of costs.  The appellant, however, argues that such issues are irrelevant in relation to this matter.
15. In addition, the appellant seeks an order that the sum of $10,000 paid by the appellant as security for the respondent’s costs of the appeal together with all accretions thereon be paid to the solicitors for the appellant.  The respondent did not oppose this order sought by the appellant.

Costs of the appeal and security

16. As the appellant was successful in his appeal against the decision of the primary judge, I am satisfied that the usual rule in awarding costs to the successful party in litigation should apply and the respondent should therefore pay the appellant’s costs of the appeal on the standard basis.  Whilst I note the respondent’s arguments in relation to limiting their obligation to pay costs to the amount of the indemnity, I am not satisfied that the respondent has established a sufficient basis for limiting the respondent’s obligation to pay costs to the amount of the indemnity prescribed in s 14(1) of the Appeal Costs Fund Regulation 2010 (Qld), particularly in circumstances where the respondent’s application to adduce further evidence and notice of contention were refused.
17. I am also satisfied that the amount of $10,000 paid by the appellant as security for costs of the appeal, including any interest accrued, should be paid to the solicitors for the appellant.

Costs of the first trial

18. When a new trial is ordered, the usual rule is that the costs of the first trial follow the result of the re-trial unless it can be shown that the conduct of one of the parties caused the need for a new trial and it may be appropriate, in such circumstances, for that party to pay the costs of the first trial.^[10]
19. Although the appeal was successful, I do not think it is appropriate in the present case to make an order that the respondent pay the appellant’s costs of the first trial.  I have not been shown any evidence of the respondent’s conduct which caused the need for a new trial.  I do not consider that the appellant’s impecuniosity and the finding of contempt against him are relevant to this issue.
20. I consider therefore that the usual rule should apply and the trial judge who hears the new trial should make orders as to costs in relation to the first trial and the re-trial following the conclusion of the matter.

Indemnity certificate

21. Section 15(1) of the Appeal Costs Fund Act 1973 (Qld) provides:

“15Grant of indemnity certificate

(1)Where an appeal against the decision of a court—

(a)to the Supreme Court;

(b)to the High Court of Australia from a decision of the Supreme Court;

on a question of law succeeds, the Supreme Court may, upon application made in that behalf, grant to any respondent to the appeal an indemnity certificate in respect of the appeal.”

22. In Mitchell v Pacific Dawn Pty Ltd,^[11] McPherson JA observed:

“As to costs, a great deal has been expended on the litigation, not all of which will be thrown away if a further hearing and determination proceeds to a conclusion. It was not, however, the fault of the parties that this has not already occurred, but a failing in the system for which they, their legal advisers or counsel are in no way responsible. Failure by the judge to give adequate reasons was held on appeal in Pettitt v Dunkley [1971] 1 NSWLR 376 to constitute an error in law. When, as happened in the present case, that failure was attributable not to the parties but the judge, and the appeal succeeds on that ground, it is an appropriate case under s 15(1) of the Appeal Costs Fund Act 1973 (Qld) in which to grant an indemnity certificate having the effects and incidents set out in s 16 of that Act.”

23. I accept that the learned trial judge made errors of law in his Honour’s reasons and that the respondent’s conduct and submissions at trial did not contribute to these errors.  There are no discretionary factors in the present case which would require an indemnity certificate to be refused.
24. Therefore, in my view, it is appropriate for an indemnity certificate to be granted to the respondent in accordance with s 15(1) of the Appeal Costs Fund Act 1973 (Qld).

Orders

25. I would make the following orders:
    1. The respondent pay the appellant’s costs of and incidental to the appeal, including the costs of and incidental to the security for costs application, the application to adduce further evidence and the notice of contention, to be assessed on the standard basis.
    2. The sum of $10,000 paid into court by the appellant as security for the respondent’s costs of the appeal together with all accretions thereon be paid to the solicitors for the appellant.
    3. The order of the primary judge made on 22 July 2014 that there be no orders as to costs of the first trial be set aside.
    4. The orders as to costs in respect of the first trial that took place in July 2013 and the re-trial be determined by the new trial judge at the conclusion of the re-trial.
    5. The respondent be granted an indemnity certificate pursuant to s 15(1) of the Appeal Costs Fund Act 1973 (Qld) in respect of the appeal.