Ridout v Rich No. 2[2017] QDC 144

DISTRICT COURT OF QUEENSLAND

1. [1]
   On 17 May 2017 the appeal in this proceeding was allowed, the plaintiff’s claim in the Magistrate’s Court proceeding below was dismissed and judgment was ordered for the defendants against the plaintiff. The parties were at liberty to make submissions as to costs within seven days. An extension of time was granted. Submissions were received on 31 May.

2. [2]
   The successful appellants seek their costs of the appeal because:

1. Under UCPR r 681 costs follow the event unless the court otherwise orders;
2. The appellants won the event;
3. There are no “exceptional circumstances” such as to engage the operation of UCPR r 684;
4. The court should not order costs on the basis of issues won;
5. The appellants were unsuccessful on only one issue, namely, whether an agreement made by counsel before trial precluded the appellants from relying on an argument that the guarantee’s relevant covenants were unenforceable by the respondent for failing to touch and concern the land; and
6. That issue was legitimately and reasonably arguable;
7. If issues are to be considered, the appellants won on 7 of 8.

3. [3]
   I accept those submissions.

4. [4]
   The respondent seeks orders that:

1. There be no order as to costs; or
2. The respondent be ordered to pay only 30 to 50 per cent of the appellants’ costs; and
3. To the extent that the respondent is ordered to pay the appellants’ costs, the court should grant a certificate pursuant to s 15 of the Appeal Costs Fund Act.

5. [5]
   The respondent’s counsel submitted that the respondent, Mr Rich, was successful in relation to matters raised in his notice of contention and related matters, namely that the appellants should be estopped from contending that the guarantee did not apply to the respondent as assignee of the lease.

6. [6]
   I reject that submission. At paragraphs [7] to [9] of the reasons for judgment^[1] one sees that Mr Rich was unsuccessful on all matters raised by his notice of contention and that the appellants were not estopped from raising two arguments.  It was the appellants and not Mr Rich who won the first and second preliminary issues introduced for Mr Rich by his notice of contention.  It is difficult to be precise as to the amount of time devoted to those two preliminary issues in argument and preparation.  My general impression is that about a quarter of the time devoted to submissions was spent on the two preliminary issues introduced by Mr Rich’s notice of contention. Had Mr Rich’s counsel not properly conceded that his arguments on those points could not succeed, even more time would have been devoted to them. On the facts and the law, they were shown to be weak arguments for Mr Rich by the submissions for the appellants. The scholarly and comprehensive arguments of the appellants’ counsel on these two issues must have taken considerable time to compile.

7. [7]
   For Mr Rich it was also argued that he was successful on the argument that the appellants should not be permitted to argue that the guarantee did not touch and concern the land. He was successful on that issue. That was the only issue upon which he succeeded on appeal.

8. [8]
   It was further submitted for Mr Rich that the appellants succeeded only on a relatively narrow point but were unsuccessful in relation to larger questions which took considerable time. I do not accept that submission. On the contrary, the appellants succeeded on most points and were unsuccessful on only the one point I have just mentioned.

9. [9]
   I am not persuaded to exercise the discretion to make a percentage order so as to deny the successful appellants any percentage of their costs.

10. [10]
    The argument that Mr Rich be granted an indemnity certificate is based on a submission that the decision below involved the interpretation of an instrument; that the appeal was about a point of law; that Mr Rich’s argument on the point of law was fairly arguable.

11. [11]
    Ordinarily certificates are ordered to compensate a losing party for costs thrown away through no fault of that party, such as where the court makes an error and the losing party was not responsible. Certificates are not ordinarily ordered where the losing party urged the court below to make an error. While Mr Rich’s counsel below made fairly arguable submissions, and repeated many on appeal, I reject them as wrong. The court below was led into its several errors at the urging of Mr Rich’s counsel.

12. [12]
    I am not persuaded that it is an appropriate case for the grant of a certificate.