Prosser v Lifetime International.com Pty Ltd (No. 2)
[2024] QDC 201
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- Unreported Judgment
- Prosser v Lifetime International.com Pty Ltd (No. 2)[2024] QDC 201
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Prosser v Lifetime International.com Pty Ltd (No. 2)[2024] QDC 201
Prosser v Lifetime International.com Pty Ltd (No. 2)[2024] QDC 201
DISTRICT COURT OF QUEENSLAND
CITATION: | Prosser v Lifetime International.com Pty Ltd (No. 2) [2024] QDC 201 |
PARTIES: | Alicia Maree Prosser as Trustee for Prosser Family Trust (Plaintiff/Applicant) v Lifetime International.com Pty Ltd ACN 080 098 120 (Defendant/Respondent) |
FILE NO: | 1775 of 2024 |
DIVISION: | Civil |
PROCEEDING: | Costs and other orders hearing. |
ORIGINATING COURT: | Brisbane District Court |
DELIVERED ON: | 29 November 2024. |
DELIVERED AT: | Brisbane. |
HEARING DATE: | Heard on the papers. |
JUDGE: | Byrne KC DCJ |
ORDERS: |
|
CATCHWORDS: | PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – where an application for summary judgment was granted in part and judgment was entered in favour of the plaintiff for damages for loss of bargain and legal costs incurred – where the application for summary judgment in respect of damages for the make good costs was refused – where the parties were invited to provide submissions in respect to costs – where both parties agree that the costs in respect of damages for the loss of bargain and legal costs incurred should follow the event and be assessed on an indemnity basis but do not agree as to the form of the costs order – where the parties agree that the costs of the proceeding should otherwise be reserved. PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – where the damages awarded for loss of bargain included a component of GST – where the parties were invited to provide submissions in respect to whether the damages awarded for loss of bargain should be inclusive of GST – where both parties contend that the award of damages for loss of bargain should not include a component of GST. PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – where the damages awarded for the legal costs incurred did not include interest – where the plaintiff is entitled to claim interest in respect of the legal costs incurred pursuant to r. 58 of the Civil Proceedings Act 2011. |
LEGISLATION: | Civil Proceedings Act 2011 (Qld) s. 58. Uniform Civil Procedure Rules 1999 (Qld) rr. 165, 667. |
CASES: | McEwan v The Commissioner of Taxation [2024] QSC 286. Nortask Pty Ltd v Areva Solar KCP Pty Ltd (No. 2) [2018] QSC 210. Prosser v Lifetime International.com Pty Ltd [2024] QDC 193. |
COUNSEL: | Ms. S. Long for the plaintiff/applicant. Mr. D Payard for the defendant/respondent. |
SOLICITORS: | Robinson Locke Litigation Lawyers for the plaintiff/applicant. Dentons for the defendant/respondent. |
Background
- [1]On 11 November 2024 I delivered judgment for the plaintiff/applicant in respect of two heads of damage and awarded damages in the total of $125,569.74, which included a component of GST in respect of one of the heads of damage.[1] I invited submissions concerning the inclusion of that GST component, and also as to costs. Those submissions have been received and considered.
The inclusion of GST in the damages award and Interest on damages for legal costs.
- [2]I accept the defendant’s submission that the award of damages should not include a component of GST for the loss of bargain comprising the lost rent. The award of the damages under this head does not amount to a “taxable supply”, and so the receipt of the damages does not create a liability for payment of GST, at least on the evidence before me.[2] The plaintiff does not press for them to be included in the damages awarded. The orders should be varied by removing them from the calculated amount.[3]
- [3]The plaintiff has identified that the orders of 11 November 2024 do not include the claimed interest pursuant to s. 58 of the Civil Proceedings Act 2011. That was payable only in respect of the damages for legal costs incurred, and has been calculated as $227.03. This was properly claimed. The orders should also be varied by including this amount.
Costs.
- [4]The lease the subject of these proceedings contemplated that the defendant as lessee must pay all reasonable costs, including legal costs on the full indemnity basis. That is a relevant circumstance to take into account in deciding the basis on which costs should be ordered. The parties agree they should be ordered on this basis, and that is appropriate.
- [5]They also agree that the prima facie rule that costs follow the event applies. Otherwise, there is no agreement as to the form of orders for the costs of the application. Given the partial success on the application, the plaintiff contends that she is entitled to 75% of her costs of the application. This is, in effect arrived at by a consideration of what is said to be the weight of the material relied on to achieve the success she did, and hence she argues that most of the costs incurred were necessary to achieve that success.
- [6]The defendant submits that each party should bear their own costs. It complains that the orders were granted on the basis of deemed admissions which had not been raised by the plaintiff in correspondence and, had they been, those heads of damage could have been resolved without the cost of litigation. That cannot be accepted. Only the loss of bargain damages were considered by me on the basis of a deemed admission, and that deemed admission was highlighted in the plaintiff’s reply. There was no need for her to further raise it.
- [7]The damages for legal costs incurred were, in part, granted because the defendant had pleaded a non-admission and hence could not adduce evidence contradicting that adduced on the application by the plaintiff unless it went to another issue.[4] There was no obligation on the plaintiff to inform the defendant of the effect of the rules.
- [8]In effect, it is further argued that rather than trying to determine the percentage of effort for the parts of the claim that a broad approach should be taken that recognises that the plaintiff did not succeed on the larger part of the claim assessed by quantum, meaning that the success of the defendant on the larger portion would entitle it to costs on the standard basis and the plaintiff would be entitled to her costs of the smaller portion on the indemnity basis. It is submitted therefore that each parties’ costs cancel each other out and, given the difficulties of accurately apportioning the costs incurred by each party, each party should just bear their own costs.
- [9]Freeburn J has recently published a decision that, briefly, traverses the differing approaches where there has been partial success only.[5] I prefer the approach that keeps the assessment a simple and inexpensive as possible. There is little utility in trying to calculate a percentage of effort and therefore costs that have followed the event. The difficulty with the defendant’s approach is that, although avowing the desirability of trying to apportion costs, it is a de facto method of doing just that.
- [10]The plaintiff obtained summary judgment on two of the three heads of damage and, while the damages awarded were less than those sought on the head of damages that she did not succeed on, the amount awarded is not trifling. There is no other conduct that would disentitle the plaintiff from recognition of that success. The defendant’s submissions would see her not recover any costs, which contractually she is entitled to on the indemnity basis. In my view, an award of 50% of her costs is proper recognition of her success on the application.
- [11]The costs of the proceeding should be reserved so that an appropriate order can be made in light of the fate of the claim for damages for the make good costs. The parties agree that is appropriate.
Conclusion
- [12]The following orders are appropriate:
- A.The orders of 11 November 2024 (Prosser v Lifetime International.com Pty Ltd [2024] QDC 193) are varied to read as follows:
- 1.The application for summary judgment is granted in part.
- 2.Judgment is entered in favour of the plaintiff in the amount of $114,769.74, comprising:
- a)$108,000 for damages for loss of bargain; and
- b)$6,769.74 for damages for legal costs incurred.
- 3.The defendant is to pay interest on the damages awarded in 2 b) above, pursuant to s. 58 of the Civil Proceedings Act 2011, in the amount of $227.03 for the period 28 June 2024 to 21 November 2024.
- 4.The application for summary judgment in respect of damages for the make good costs is refused.
- 5.I will hear the parties as to costs.
- B.The defendant is to pay 50% of the plaintiff’s costs of the summary judgment application to be agreed or assessed on the indemnity basis.
- C.The costs of the proceeding are otherwise reserved.
Footnotes
[1] Prosser v Lifetime International.com Pty Ltd [2024] QDC 193.
[2] Nortask Pty Ltd v Areva Solar KCP Pty Ltd (No. 2) [2018] QSC 210, [38], [45]. See also Goods and Services Tax Ruling 2001/4 at [56]-[60].
[3] Rule 667 of the UCPR.
[4] Rule 165(2) of the UCPR.
[5] McEwan v The Commissioner of Taxation [2024] QSC 286.