Ostroco v Department of Transport and Main Roads (No. 3)
[2014] QLAC 7
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- Unreported Judgment
- Ostroco v Department of Transport and Main Roads (No. 3)[2014] QLAC 7
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Ostroco v Department of Transport and Main Roads (No. 3)[2014] QLAC 7
Ostroco v Department of Transport and Main Roads (No. 3)[2014] QLAC 7
LAND APPEAL COURT OF QUEENSLAND
CITATION: | Ostroco v Department of Transport and Main Roads (No. 3) [2014] QLAC 7 |
PARTIES: | OSTROCO PTY LTD (appellant) v CHIEF EXECUTIVE, DEPARTMENT OF TRANSPORT AND MAIN ROADS (respondent) |
FILE NO: | Appeal No. LAC001-13 Land Court No. AQL020-11 |
DIVISION: | Land Appeal Court of Queensland |
PROCEEDING: | Application for costs |
ORIGINATING COURT: | Land Court at Brisbane |
DELIVERED ON: | 18 September 2014 |
DELIVERED AT: | Brisbane |
HEARING DATE: | Heard on the Papers Submissions closed 21 November 2013 |
THE COURT: | Peter Lyons J PA Smith, Member of the Land Court WL Cochrane, Member of the Land Court |
ORDER: | 1. The respondent pay the appellant's costs of the hearing in the Land Court on the standard basis, such costs to be agreed or, failing agreement, to be assessed. 2. The respondent pay the appellant's costs of the appeal on the standard basis up until 24 January 2013 and on the indemnity basis on and from 25 January 2013, such costs to be agreed or, failing agreement, to be assessed. 3. There be no order as to the costs of the cross-appeal. |
CATCHWORDS: | PROCEDURE – COSTS – where both parties appealed the Land Court’s quantum decision to the Land Appeal Court, which determined compensation to the appellant in the sum of $564,043 plus interest – where the appellant seeks orders for costs of the Land Court hearing and the Land Appeal Court hearing and the respondent seeks orders for costs of its cross-appeal – where the position taken by the respondent at the Land Court hearing was that no compensation was payable – where before the Land Appeal Court hearing the appellant made an offer to compromise – where the respondent’s position would have been better if it had accepted the offer – whether an order for costs should be made for the proceedings in the Land Court – whether the appellant should be awarded the costs of the whole of the proceedings on the indemnity basis – whether the respondent should be awarded its costs of the cross-appeal Acquisition of Land Act 1967 (Qld), s 27 Land Court Act 2000 (Qld), s 34, s 72 Colgate-Palmolive Co. v Cussons Pty Ltd (1993) 46 FCR 225 Commissioner for Railways v Buckler [1996] 1 Qd R 18; [1994] QCA 323 Emanuel Management Pty Ltd (In Liquidation) & Ors v Foster’s Brewing Group Ltd & Ors and Coopers & Lybrand & Ors [2003] QSC 299 Maitland Hospital v Fisher [No 2] (1992) 27 NSWLR 721 Mio Art Pty Ltd v Brisbane City Council (No. 3) [2013] QLAC 3 ton Moreton Bay Regional Council v Mekpine Pty Ltd & Anor (No. 2) [2014] QLAC 5 Ostroco Pty Ltd v Chief Executive, Department of Transport and Main Roads [2012] QLC 9 Ostroco Pty Ltd v Chief Executive, Department of Transport and Main Roads [2012] QLAC 6 Ostroco Pty Ltd v Chief Executive, Department of Transport and Main Roads (No. 2) [2012] QLAC 7 Ostroco Pty Ltd v Chief Executive, Department of Transport and Main Roads (No. 2) [2012] QLC 71 Ostroco Pty Ltd v Chief Executive, Department of Transport and Main Roads [2013] QLAC 4 |
COUNSEL: | PJ Flanagan QC, with PW Hackett, for the appellant DR Gore QC, with J Horton, for the respondent |
SOLICITORS: | H Drakos and Company Solicitors for the appellant Clayton Utz for the respondent |
THE COURT:
- [1]On 31 July 2009, land on which the Coorparoo Shopping Mall was constructed was compulsorily acquired for the purposes of the Eastern Busway Project. At the date of resumption, the appellant was the lessee of Shop 17 in the shopping mall.
- [2]The Land Court heard this matter and, on 13 March 2012, delivered a decision dismissing the appellant's claim for compensation.[1] The appellants successfully appealed that decision to this Court,[2] and the matter was remitted back to the Land Court for determination of the quantum of compensation. This Court also ordered that the respondent pay the appellant's costs of the appeal.[3]
- [3]The Land Court subsequently delivered its decision on compensation.[4] The appellant appealed that decision to this Court, and the respondent cross-appealed. Both the appeal and the cross-appeal were allowed,[5] this Court determining compensation in the sum of $564,043 plus interest. It is from that decision that the parties now seek orders as to costs.
- [4]The appellant seeks an order that it should be paid its costs in relation to the 2013 appeal and the hearing before the Land Court on the indemnity basis.
- [5]The respondent argues that the appellant is only entitled to 50% of its costs of the appeal to the Court and that the respondent is entitled to the costs of its cross-appeal. In those circumstances, the respondent argues, the costs cancel each other out and there should accordingly be no order as to costs.
Legal Principles
- [6]Section 34 of the Land Court Act 2000 (Qld) (LCA) provides:
"34 Costs
- (1)Subject to the provisions of this or another Act to the contrary, the Land Court may order costs for a proceeding in the court as it considers appropriate.
- (2)If the court does not make an order under subsection (1), each party to the proceeding must bear the party's own costs for the proceeding.''
- [7]Section 72(1) of the LCA provides, inter alia, that s 34 of the Act applies with necessary changes to the Land Appeal Court and s 72(2) provides that a reference in the applied section to the Land Court is taken to be a reference to the Land Appeal Court.
- [8]
"It has been held on many occasions that the discretion to award costs granted by s 34 is unfettered but that the discretion is to be exercised judicially, that is for reasons that may be explained and substantiated. However it has also been recognised by the Land Appeal Court that although the discretion to award costs is unfettered, the rule that costs follow the event may inform the exercise of the discretion granted under s 34(1), 'as there is justice in that approach. It protects those put to unnecessary and substantial expense at the behest of others'." [footnotes omitted]
Costs of the Land Court Hearing
- [9]The learned Land Court Member in his decision of 19 December 2012[7] included in his orders an order specifying that any application for costs was to be filed and served within 14 days of 19 December 2012.
- [10]No application for costs was made within the time period stipulated by the learned Member. However, Land Court records reveal that, on 21 January 2013, the respondent filed submissions seeking an award of costs.
- [11]
- [12]The appellant subsequently lodged its Notice of Appeal against the substantive determination of compensation by the learned Member. The Grounds of Appeal did not refer to the issue of costs. However, the orders sought by the appellant included an order that the respondent pay the appellant's costs of the appeal "and hearing below"[10] [emphasis added].
- [13]The Land Court has not dealt with the issue of the costs submissions received by it. The Land Court advised both parties, on 4 February 2013, that as there was an appeal before the Land Appeal Court including the matter of costs, the Land Court would await the decision of the Land Appeal Court before taking any further action.
- [14]The appellant now seeks an order of this Court that the respondent pay its costs of the hearing below on the indemnity basis. The respondent relies on s 27 of the Acquisition of Land Act 1967 (Qld) (ALA) which provides as follows:
"27 Costs
- (1)Subject to this section, the costs of and incidental to the hearing and determination by the Land Court of a claim for compensation under this Act shall be in the discretion of that court.
- (2)If the amount of compensation as determined is the amount finally claimed by the claimant in the proceedings or is nearer to that amount than to the amount of the valuation finally put in evidence by the constructing authority, costs (if any) shall be awarded to the claimant, otherwise costs (if any) shall be awarded to the constructing authority.
- (3)Subsection (2) does not apply to any appeal in respect of the decision of the Land Court or to costs awarded pursuant to section 24(3) or section 25(3)."
- [15]This Court has been, in effect, asked by the parties to determine the order for costs which should have been made in the Land Court, on the basis that compensation was determined in the amount ultimately determined by this Court. No reason has been identified for awarding the costs of the proceedings in the Land Court other than in accordance with s 27. Indeed the submissions of both parties have proceeded on that basis.
- [16]It is common ground that "Ostroco's final position" was that the award should have been an amount of $1,110,714.41.[11] Since that position was reached for the purpose of the application of s 27, it should be taken as identifying "the amount finally claimed by the claimant in the proceedings", referred to in s 27(2).
- [17]There is greater difficulty in identifying "the valuation finally put in evidence by the constructing authority" for the purposes of that provision. It is first necessary to discuss the meaning of the expression.
- [18]In Commissioner for Railways v Buckler[12] s 27(2) had to be considered in circumstances where its application was a matter of some difficulty. Compensation had been awarded on a "before and after basis", with the result that there was no specific valuation of the land which had been resumed. The matter was further complicated by the fact that the resuming authority contended that the value of the land retained by the landowner was enhanced, with the result that the retained land had a value which was $2,000,000 greater than the landowner's total holding before the resumption, so that no compensation was claimable. It became necessary to construe s 27(2) in those circumstances.
- [19]The primary question for determination, accordingly, was the identification of "the amount of the valuation finally put in evidence by the constructing authority". The natural meaning of this language would have it refer to the value of the land which had been resumed. However, the provision was to be applied to a determination of compensation, which included elements other than the value of land resumed, namely (at that time) damage caused by severance from, and injurious affection to, other land retained by the landowner.[13] Moreover, the amount of compensation to be determined was to be reduced (or offset) by the enhancement in the value of the land retained by the landowner. Accordingly, the exercise was not directed simply to a determination of the value of land. That resulted in two Members of the Court concluding that the expression, "the amount of the valuation" in s 27(2) is a reference to the value of the right to claim compensation.[14] Although using slightly different language, McPherson JA considered the expression to refer to "the constructing authority's assessment of the compensation payable".[15] His Honour also made the following observation:[16]
"… there seems to be no comparable restriction preventing the constructing authority from deferring disclosure of its final position until a late stage of the proceedings … it cannot with confidence be known what the amount of it is until the constructing authority closes its case."
- [20]There is some difficulty about the application of s 27(2) in the present case. The course of these proceedings has been referred to previously.
- [21]
- [22]However, the respondent led evidence from a Mr Brady, as to the cost of work to adapt the premises to which Ostroco proposed to move, for use as an LJ Hooker Real Estate agency. The respondent submitted, by reference to Mr Brady's evidence and as an alternative to its primary position, that the amount claimed should be substantially reduced.[19] Moreover, in its final submissions the respondent accepted the sum of $11,000 as being the quantum of professional costs being attributable to disturbance; though making clear that this was in the alternative to its primary position that no compensation was payable.[20]
- [23]When the matter was remitted to the Land Court after the first appeal to this Court, the parties relied on the evidence previously given, and the submissions previously made, save for some corrections made by the appellant, of no present relevance.[21] However, the respondent did not seek to reopen its case. The position therefore appears to be, at least subject to some submissions made on behalf of the respondent, that the position for which it contended at the close of its case was that no compensation was payable.
- [24]This issue is placed beyond doubt when regard is had to the transcript of the remitter on 5 November 2012. Ms Pollard for the respondent clearly indicated that the respondent maintained the common law point in its argument as set out in Mr Gore's submissions.[22] Of course, relying on the common law point, the respondent contended for nil compensation.
- [25]The respondent's submissions on costs acknowledge that its position taken at the close of its case was that it contended that no compensation was payable. They clarify that there were two bases for that submission, namely s 18(3) of the ALA; and the proposition, described as "the common law point", that because at the end of its lease the appellant would in any event have had to relocate, no loss had been suffered as a result of the resumption.[23] However, it sought to characterise these submissions as "preliminary points", and submitted that the true focus was on the amount of $177,886, being the relocation fees identified by Mr Brady, together with a sum of $11,000 for professional costs. It submitted that it was necessary to identify "the final positions taken up by the parties", referred to by McPherson JA in Buckler.[24]
- [26]As will be apparent from the observations of McPherson JA in Buckler quoted earlier in these reasons, his Honour's reference to the final position taken by the resuming authority was the position taken by it, at the latest, at the close of its case. Its position at that time, as manifested to the Court and the appellant, was that it considered the claim for compensation to be of no value. Section 27(2) does not call for an inquiry into the reasons for the position advanced by a constructing authority. It is therefore not appropriate to attempt to characterise its position by reference to questions of law said to be then undecided, as "preliminary points"; nor is it appropriate to identify an alternative position, not being the position primarily contended for by the respondent, as "the amount of the valuation finally put in evidence by the constructing authority", for the purposes of s 27(2).
- [27]The respondent also submitted that the relevant position was that taken at the second Land Court hearing, and should properly be understood as being a contention that the sum of $177,886 was the proper amount of compensation. However, it was not the position it had taken in the course of its evidence, nor when it closed its case. It would involve a further extension of the meaning of the expression used in s 27(2) for reasons not obviously apparent from the language of the provision, nor from its statutory context. In Buckler, McPherson JA alluded to the advantage conferred on a constructing authority by the language of s 27(2).[25] There is no apparent reason to extend that advantage beyond what is required by a consideration of the language used, and its statutory context. The respondent's submissions should not be accepted.
- [28]In any event, it is contentious whether the respondent's position taken on the remitted hearing was that compensation should be assessed in the sum of $177,886.[26] There is no suggestion the respondent made any alteration to the submissions which it had made in the Land Court at the first hearing.
- [29]Accordingly s 27(2) of the ALA should be applied in the present case, on the basis that the relevant position taken by the respondent was that no compensation was payable. On that basis compensation, as ultimately determined, was closer to the position taken by the appellant, than to the position taken by the respondent. The respondent did not submit that, if that conclusion were reached, the costs of the hearings in the Land Court should not be awarded to the appellant. Accordingly, there should be an order for those costs in the appellant's favour.
Costs of the Appeal
- [30]The appellant seeks its costs of the appeal on the indemnity basis. The respondent submits that there should be no order as to costs, on the basis that it should recover its costs below as well as the costs of its cross-appeal and that the appellant should recover half of its costs of the appeal, with the end result being that the various costs effectively cancel each other out.
- [31]The appellant contends that it was successful on the most significant head of claim, being that of relocation costs. It further argues that, in light of the respondent's contentions on appeal that no relocation costs had been suffered by the appellant as a consequence of the resumption as they were costs which the appellant's would have incurred in any event, which contention this Court rejected, the respondent was effectively arguing on appeal that no amount should be paid to the appellant.
- [32]The respondent counters that the appellant only succeeded on one of three grounds of appeal, being that of relocation costs. It further says that the other two issues were also principal issues, they being the claims for economic loss and loss of rental.
- [33]In our view, this appeal can properly be categorised as one where the appellant was successful. The bulk of the hearing on appeal was taken up with the relocation costs issue. The additional amount recovered by the appellant in this regard on appeal was significant, particularly when the deduction arising from the cross-appeal is taken into account.
- [34]This position is to be distinguished from the factual position which the Land Appeal Court had before it in Mio Art Pty Ltd v Brisbane City Council (No. 3)[27] where the Court ordered that the respondent pay 75% of the appellant's costs.
- [35]In the circumstances, this appears to be an appropriate case to follow the course adopted by this Court in Mekpine, referred to earlier in these reasons. This position is also consistent with the approach taken by this Court with respect to the question of the costs of the first Ostroco appeal.[28] Moreover, the respondent's submission that it should recover its costs below has not been accepted.
- [36]The respondent should pay the appellant's costs of the appeal.
Appellant’s application for indemnity costs
- [37]The appellant seeks that its costs of the appeal be paid by the respondent on the indemnity basis.
- [38]
"[17] The authority to which attention is usually directed is Colgate-Palmolive Co. v Cussons Pty Ltd (1993) 46 FCR 225 in which Sheppard J identified a number of circumstances in which it may be appropriate to make an order for indemnity costs. They include:
- (i)Making allegations of fraud knowing them to be false or making irrelevant allegations of fraud.
- (ii)Misconduct that causes loss of time to the court and the opponent.
- (iii)Commencing or continuing proceedings for some ulterior motive or in wilful disregard of known facts or clear law.
- (iv)Making groundless allegations.
- (v)An imprudent refusal of an offer to compromise.
'The question must always be whether the particular facts and circumstances … warrant the making of an order for payment of costs other than on a party into party basis.'
[18] Rosniak v Government Insurance Office (1997) 41 NSWLR 608 (at 616) has perhaps taken the position furthest in deciding that it is not necessary for the party seeking the protection of indemnity costs to establish ethical or moral delinquency by its opponent. It is enough to show 'unreasonable conduct' of some sort. That case itself demonstrates that the inexactness of such a test can give rise to difficulty in its application."
- [39]The appellant relies upon principles (iv) and (v) from Colgate-Palmolive Co. v Cussons Pty Ltd;[31] that is the making of groundless allegations by the respondent which the appellant says should never have been made, and the respondent imprudently refusing an offer to compromise.
- [40]The appellant asserts the following facts in support of its application that costs be ordered on the indemnity basis:[32]
"(a) No advance of compensation was every [sic] offered or paid by the respondent pursuant to s.23 of the Act;
- (b)The claim for compensation was twice mediated in the Land Court;
- (c)No offer to settle was ever forthcoming from the respondent (which is explicable by reference to the position it adopted at all times that there should be no compensation);
- (d)On 25 January 2013 the appellant offered to compromise its claim for compensation and appeal rights for a payment of $600,000 all up inclusive of costs (including the costs awarded by the Land Appeal Court in respect of the first appeal). The amount determined by the Land Appeal Court ($564,043) and the agreed costs of the first appeal ($38,979.40) total $603,022.40. Accordingly, the offer made by the appellant to the respondent to compromise the appeal and cross appeal was more favourable than the ultimate result. It was imprudent of the respondent to not have accepted the same.
- (e)The allegations/issues raised by the respondent in respect of three (3) matters which took up a considerable part of the dispute have been found to have no substance in two separate appeals:
- (i)The s.18(3) argument the primary focus of the initial hearing and first appeal entirely failed and was found to be wrong in law;
- (ii)The contention that no relocation costs ought to be assessed because the appellant had remained in occupation of the leased premises beyond the expiry of the lease and would have incurred those costs entirely failed and was found to be wrong in law; and
- (iii)The reliance upon the approach of Mr Brady to assess relocation costs entirely failed and was found to be wrong in law."
- [41]It is noted that the respondent has produced sworn evidence[33] in response to what the appellant says are the facts with respect to two matters in particular. Firstly, the respondent points out that the matter was not "twice mediated" but was actually mediated once over two days by the Judicial Registrar, for a total length of time of five hours.
- [42]Secondly, the respondent notes that it did make an offer to settle the litigation, but as that occurred during confidential mediation, it does not take the matter further than that.
- [43]The respondent rejects the appellant's contentions as to the conduct of its case on the appeal and says that there is nothing on the material to indicate that the conduct of the respondent was unreasonable. It points to the fact that it was successful on two of the three grounds of appeal, as well as on its cross-appeal.
- [44]As to the question of the offer to settle, the respondent says that, on its face, such offer exceeded the Court's ultimate determination.
- [45]As indicated, the offer was for a payment by the respondent of $600,000 all up, inclusive of costs, including the costs awarded by this Court of the first appeal. The appellant contends that compensation and the costs of the first appeal amount to $603,022.40, which is an amount greater than the offer. That result is reached by reference to the compensation determined by this Court, together with an amount of $38,979.40 being the amount subsequently agreed between the parties as the appellant's costs of the first appeal to this Court.[34] In addition to these amounts, there is the benefit of the order for costs of the proceedings in the Land Court, which involved a two day hearing with experts; as well as the second hearing, though this was unlikely to have incurred substantial costs. Given that the hearing of the first appeal to this Court was concluded in a day and did not require witnesses, it would seem that the order for costs of the proceedings in the Land Court is likely to be worth substantially more than the agreed amount of the costs of the first appeal to this Court. Moreover, the submissions for the appellant pointed out that the determination of compensation in its favour would carry with it interest, calculated by it to be $6,737.63, from the date of resumption to 17 October 2013.
- [46]It follows that, had the respondent accepted the appellant's offer, its position would have been better than it is as a result of the determination of the appeal, by a not inconsiderable amount.
- [47]The appellant submitted that in those circumstances it should have its costs of the second appeal on the indemnity basis. It relied on the following statement, taken from the judgment of Chesterman J in Emanuel:[35]
"The making of an offer in the circumstances in question is a very relevant circumstance to be taken into account when exercising the discretion. If there are no countervailing circumstances the order for indemnity costs is likely to be made."
- [48]However, it is far from clear that the question of costs was determined by Chesterman J on this basis. His Honour continued:[36]
"In this case I can see no countervailing circumstances. Indeed as I have explained the plaintiffs should have appreciated that their case had no worthwhile prospect of success. It was, therefore, unreasonable not to accept the offer."
- [49]The appellant's submissions also referred to the decision of Philip McMurdo J in Anderson v AON Risk Services Australia Ltd & anor,[37] where a successful defendant had made a number of offers, not bettered at trial. His Honour referred to the decision of Chesterman J in Emanuel. He found that the offers had been rejected unreasonably. While he did not consider that there was a "rule" in such a case that costs should be awarded to the successful defendant on the indemnity basis, he made such an order because he considered that "justice is best served" by doing so. His Honour noted the insurance policy on which the plaintiff unsuccessfully sued had issued "in the context of misrepresentations by the plaintiff, as the plaintiff's advisers are likely to have advised him had they been given accurate and complete instructions" and that, in rejecting one of the offers, "the plaintiff was seeking to profit from the insurance, in the sense of ultimately obtaining more than the allegedly stolen items had been worth".[38] This reasoning would not support the making of an order for indemnity costs in the present case.
- [50]The appellant's submissions also referred to a statement in the judgment in Colgate-Palmolive[39] to the effect that an order for indemnity costs may be made where an offer to compromise has been imprudently refused. Three authorities were there cited.
- [51]In the first, Messiter v Hutchinson,[40] a defendant made a Calderbank offer of an amount in excess of that which the plaintiff ultimately recovered. Rogers J considered the significance of the fact that the defendant had made an offer rather than a payment to the court. Nevertheless, his Honour made an order that the plaintiff not recover costs after the date of the expiry of the offer. In doing so, his Honour referred to the need to consider the circumstances in which the offer was made instead of a payment into court and continued:[41]
"So long as adequate consideration is given to the matters I have mentioned, it seems to me there is no reason why the Court should not foster all means whereby parties may properly attempt to dispose of their disputes prior to actual hearing, either in Court or by a referee or arbitrator".
- [52]His Honour also referred to a statement by Oliver LJ in Cutts v Head[42] which included the proposition that "a consciousness of a risk as to costs if reasonable offers are refused can only encourage settlement".
- [53]In Maitland Hospital v Fisher [No 2],[43] a plaintiff who had obtained judgment for the sum of $206,090, made an offer to settle the defendant's appeal against the judgment for $200,000. The offer was not accepted. The offer purported to be made in accordance with rules somewhat similar to those now found in the Uniform Civil Procedures Rules 1999 (Qld) (UCPR). The Court held that the relevant rules applied to appeals. The plaintiff, having successfully resisted the appeal, was awarded indemnity costs. In doing so, the Court noted that the objects of the relevant rule included the saving of private costs; the avoidance of delays and uncertainties; and the saving of public costs; as well as to indemnify a party who made an offer of compromise, later found to have been reasonable, against costs subsequently incurred.[44] These considerations would seem to support the making of an order for indemnity costs in the present appeal, at least subsequent to the making of the offer.
- [54]The Court also referred to the fact that the amount offered was only $6,090 less than the judgment. The difference was described as being "real and not trivial or contemptuous".[45] The offer was considered to be one which "realistically assessed the chances of success in the appeal".[46] However the Court went on to emphasise that its decision was discretionary; and the discretion must be exercised by reference to all of the circumstances of the case.
- [55]Crisp v Keng,[47] the third case cited in Colgate-Palmolive, was a case where a plaintiff had been refused indemnity costs at first instance, although an offer had been made to accept an amount less than the judgment ultimately given in the plaintiff's favour. The majority were not satisfied that the plaintiff, on the appeal, had established any error in the exercise of discretion by the primary judge. Kirby P, who would have allowed the appeal, referred to the principles stated in Maitland Hospital.
- [56]This review of the cases would suggest that an offer, and in particular a Calderbank offer, made outside the rules may well be a significant matter in determining whether to award costs on the indemnity basis; and that there are strong policy reasons for making such an award, even when there is not a marked difference between the offer and the ultimate result. However, the making of an order for indemnity costs is discretionary; and there is no fixed rule that in certain circumstances, it should be made.
- [57]The reasons for the provisions found in the rules of court, as discussed in Maitland Hospital, appear to be a relevant consideration. They would favour awarding the appellant its costs of the second appeal, on the indemnity basis, from about the time of the offer. Unlike a defendant who can make a payment into court, which usually results in an award of indemnity costs if the plaintiff receives a judgment for a lesser amount, an appellant-claimant can do no more to protect itself in respect of its costs of the appeal.
- [58]At the time of the appeal, the appellant had in its favour a judgment in an amount of $319,510; but it conceded that of that sum $152,624 could not be supported. On the appeal the appellant sought compensation in the sum of $1,110,449. Bearing in mind the nature of the submissions made by the respondent against it, the appellant was entitled to think that it had good prospects of success in respect of its claim for relocation costs. With that in mind, and taking into account the existing order for costs in its favour in respect of the first appeal, and its prospects of an award of costs in respect of the hearings in the Land Court, its offer made on 25 January 2013 was realistic. So much is confirmed by the judgment of this Court in the second appeal. It might also be noted that although the appellant failed on the other issues raised by it, it could not be said that its contentions on these matters were unarguable; or entirely without prospects of success.
- [59]The respondent's case on the relocation costs, so far as the quantum was concerned, could not have been regarded as particularly strong. While it might not be possible to characterise its failure to accept the appellant's offer as imprudent, viewed in light of the circumstances at the time, acceptance of the offer would have nevertheless been a sensible course for the respondent to take. The policy considerations previously referred to would favour the making of an order for indemnity costs in respect of the second appeal.
- [60]The appellant has also sought an order for the indemnity costs of the whole of the proceedings. That seems to be based upon the proposition that the respondent advanced matters without substance; and (perhaps) that its conduct, looked at as a whole, was unreasonable.[48]
- [61]The contentions which were said to be unreasonable were that s 18(3) of the ALA dictated that no compensation was payable; that the appellant was not entitled to relocation costs because it had remained in the resumed premises, and would ultimately have incurred the costs of the relocation; and that the distinction made by Mr Brady between what were described as landlord's costs and tenant's costs should be accepted. However, on analysis, the appellant's contention is really based on the fact that the respondent failed on these issues. There is a difference between contesting a matter on a basis which fails; and contesting a matter on a basis which is groundless or without substance. The appellant has not demonstrated that any of the matters on which it relies fall into the latter category. In those circumstances, the fact that the respondent made no offer to settle and paid no advance in respect of compensation could hardly be said to justify an order for indemnity costs for the whole of the proceedings.
- [62]The appellant's submission that its costs of the hearing in the Land Court be assessed on an indemnity basis is refused.
Costs of the Cross-Appeal
- [63]The respondent seeks its costs of the cross-appeal.
- [64]Before the respondent instituted its cross-appeal, the appellant made plain in its Notice of Appeal that it accepted it was not entitled to maintain the judgment of the Land Court, so far as it related to the amount which became the subject of the cross-appeal. In those circumstances, it could not have resisted an order on the appeal, which reflected that concession. No justification has been identified for the institution of the cross-appeal; and accordingly there should be no order for costs in respect of it.
Orders
- The respondent pay the appellant's costs of the hearing in the Land Court on the standard basis, such costs to be agreed or, failing agreement, to be assessed.
- The respondent pay the appellant's costs of the appeal on the standard basis up until 24 January 2013 and on the indemnity basis on and from 25 January 2013, such costs to be agreed or, failing agreement, to be assessed.
- There be no order as to the costs of the cross-appeal.
PETER LYONS J
PA SMITH
MEMBER OF THE LAND COURT
WL COCHRANE
MEMBER OF THE LAND COURT
Footnotes
[1]Ostroco Pty Ltd v Chief Executive, Department of Transport and Main Roads [2012] QLC 9.
[2]Ostroco Pty Ltd v Chief Executive, Department of Transport and Main Roads [2012] QLAC 6.
[3]Ostroco Pty Ltd v Chief Executive, Department of Transport and Main Roads (No. 2) [2012] QLAC 7.
[4]Ostroco Pty Ltd v Chief Executive, Department of Transport and Main Roads (No. 2) [2012] QLC 71.
[5]Ostroco Pty Ltd v Chief Executive, Department of Transport and Main Roads [2013] QLAC 4.
[6][2014] QLAC 5 (Mekpine) at [12].
[7]See [2012] QLC 71.
[8]Now the appellant.
[9]Ex CGC-1 to Affidavit of Constantine George Castrisos sworn 21 November 2013.
[10]Appeal Record Volume 5 (5 AR) p 988..
[11]See Respondent's Submissions on Costs para 12.
[12][1996] 1 Qd R 18 (Buckler).
[13]See ibid at 24.
[14]Ibid at 23 per Pincus JA; at 19 per Fitzgerald P.
[15]Ibid at 25.
[16]Ibid at 24.
[17]See for example, 5 AR p 960 para 2.
[18]1 AR p 183; p 206 para 7B.
[19]See 5 AR pp 964-966 and 969.
[20]See 5 AR p 968 para 28; and see footnote 24.
[21]See 5 AR p 970.
[22]T 5 November 2012 1-4 l37 to 1-5 l8
[23]Respondent's Submissions on Costs para 8.
[24]At 23.
[25]At pp 23-24.
[26]See the Appellant's Outline on Costs in Reply para 8.
[27][2013] QLAC 3.
[28]Ostroco v Department of Transport and Main Roads (No. 2) [2012] QLAC 7.
[29][2003] QSC 299 (Emanuel).
[30]At [17] and [18].
[31](1993) 46 FCR 225 (Colgate-Palmolive).
[32]Appellant's Outline on Costs para 35.
[33]Affidavit of Majella Mary Pollard sworn 11 November 2013.
[34]See Ex CGC-1 to the Affidavit of Constantine George Castrisos sworn 31 October 2013.
[35]At [39].
[36]At [40].
[37][2004] QSC 180.
[38]Ibid at [10].
[39]At 233.
[40](1987) 10 NSWLR 525.
[41]At 529.
[42][1984] Ch 290 at 306.
[43](1992) 27 NSWLR 721 (Maitland Hospital).
[44]Ibid at 724.
[45]Ibid at 725.
[46]Ibid at 725.
[47][1993] NSWCA 78; BC 9302116.
[48]See Emanuel at [18].