SFP Events Pty Ltd v Little Swamp II Inc [No 2]
[2024] QSC 153
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- Unreported Judgment
- SFP Events Pty Ltd v Little Swamp II Inc [No 2][2024] QSC 153
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SFP Events Pty Ltd v Little Swamp II Inc [No 2][2024] QSC 153
SFP Events Pty Ltd v Little Swamp II Inc [No 2][2024] QSC 153
SUPREME COURT OF QUEENSLAND
CITATION: | SFP Events Pty Ltd v Little Swamp II, Inc & Anor (No 2) [2024] QSC 153 |
PARTIES: | SFP EVENTS PTY LTD ACN 605 140 501 (applicant) v LITTLE SWAMP II, INC 2649015 (first respondent) and CREATIVE ARTISTS AGENCY, LLC (second respondent) |
FILE NO/S: | BS No 2275/24 |
DIVISION: | Trial Division |
PROCEEDING: | Costs application |
ORIGINATING COURT: | Supreme Court of Queensland at Brisbane |
DELIVERED ON: | 31 July 2024 |
DELIVERED AT: | Brisbane |
HEARING DATE: | Heard on the papers |
JUDGE: | Treston J |
ORDER: |
|
CATCHWORDS: | PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – GENERAL RULE: COSTS FOLLOW EVENT – GENERAL PRINCIPLES AND EXERCISE OF DISCRETION – where the parties provided further submissions on the issue of costs – where the respondents succeeded in their application for a stay – where it was unnecessary to decide a separate ground pertaining to setting aside service of the originating application – where that ground would have been decided in favour of the applicant – where the applicant submits that there be some proportionate reduction to any costs to reflect the mixed success of the respondent – where the applicant submits that each respondent ought to have been represented by the same counsel – whether the general rule that costs follow the event should apply – whether each respondent ought to have been represented by the same counsel International Arbitration Act 1974 (Cth) s 7 Uniform Civil Procedure Rules 1999 (Qld) r 16(g), r 127, r 681 Althaus v Australian Meat Holdings Pty Ltd [2006] QCA 499, cited Oshlack v Richmond River Council (1998) 193 CLR 72, cited Speets Investment Pty Ltd v Bencol Pty Ltd (No 2) [2021] QCA 39, cited |
COUNSEL: | L Copley for the applicant D Tay for the first respondent AM Pomerenke KC for the second respondent |
SOLICITORS: | Rooks Law for the applicant Corrs Chambers Westgarth for the first respondent DLA Piper for the second respondent |
- [1]On 21 June 2024, I made an order that pursuant to s 7 of the International Arbitration Act 1974 (Cth) (“International Arbitration Act 1974”), the proceedings between the parties be stayed and the dispute between them be referred to arbitration in California. Those orders arose out of two interlocutory applications brought by the first and second respondents. Those applications each advanced three alternative grounds each of which would have achieved the outcome that the applicant, SFP Events Pty Ltd (“SFP”), could not pursue its proceedings in the Supreme Court of Queensland.
- [2]Both respondents succeeded in their application for a stay under the International Arbitration Act 1974, and would also have succeeded, were it necessary to so decide, on the ground that the proceeding be stayed pursuant to r 16(g) or r 127 of the Uniform Civil Procedure Rules 1999 (Qld) (“UCPR”), or in the exercise of the inherent jurisdiction of the court. I found it was unnecessary to decide the third ground, that is the ground pertaining to setting aside service of the originating application, although had it been necessary to decide that point, I would not have decided that point in favour of the respondents.
- [3]The respondents seek that SFP pays their costs of the interlocutory applications on a standard basis.
- [4]SFP submits that a costs order should be made either:
- that there be no order as to costs, or there be some proportionate reduction to any costs to reflect the mixed success of the respondents; or
- alternatively, that SFP pays 50 per cent of each of the respondents’ costs to be assessed on the standard basis.
- [5]For the reasons which follow, I order that SFP pay the first and second respondents’ costs of the interlocutory applications filed on 18 April 2024 to be assessed on a standard basis.
- [6]First, costs of an application are in the discretion of the court, but follow the event unless the court otherwise orders.[1] Recognising that the primary purpose of an award of costs is to indemnify the successful party[2] it can be said at the outset that both respondents were primarily successful in their claim for the proceeding in the Supreme Court of Queensland to be stayed. This is particularly so when it is remembered that SFP’s attack on the arbitration agreement was confined to whether the main agreement between the parties was concluded or not. SFP did not contend for any separate attack upon the clause that constituted the arbitration agreement.[3] In the circumstances, there was a prima facie basis that there was a concluded separable arbitration agreement.
- [7]Second, the principle that the primary purpose of an award of costs is to indemnify the successful party is subject only to “limited exceptions”;[4] there are no such exceptions in the circumstances of this case. The fact that I found that, had it been necessary to do so, I would have decided one of the grounds against the respondents (the service ground) is not any such exception for four reasons:
- it was unnecessary to decide the point[5] and accordingly, the matter was only addressed briefly in the judgment;
- deciding the point had no positive consequence for the proceeding, the proceeding otherwise having been stayed on either of the two alternative grounds;
- the service issue required little evidence, and was one which occupied much less time on the hearing of the application than the substantive issues, both of which were decided against SFP; and
- as a consequence of these three reasons, the service issue was immaterial to the outcome of the application.
- [8]
- “[14]It is important to recognise, however, that it does not follow from the foregoing that an application of the general rule should usually lead to costs orders which reflect different results on separate events or issues. The Court is given a broad discretion and is specifically empowered to determine that some other order is more appropriate.
- [15]In practice, courts often take the approach of identifying heads of controversy or “units of litigation” … regarding success or failure on the head of controversy or unit of litigation as to the criterion for awarding costs …
- [16]The general approach is that there must be some special or exceptional circumstances to warrant depriving a successful party of its costs and the mere fact that the successful party has been unsuccessful on some issues will ordinarily not be sufficient to do so.”
- [9]Third, had I decided to give no reasons as to the service question, it could not have been said that the respondents had been unsuccessful on that issue. The fact that I chose to deal with the issue in deference to the submissions ought not to change what would have otherwise been the costs outcome.
- [10]Finally, as to the issue raised by SFP that there was no reason for Little Swamp and Creative Artists Agency, LLC (CAA) to have separate representation as submitted by SFP at paras 6 to 9 of its submissions, the submission must be rejected. The first and second respondents are entirely unrelated entities. Different claims were advanced against each of them by the applicant. Whilst there was naturally overlap in the submissions that were made, the terms of the arbitration agreement and the grounds for the stay being common, each respondent also advanced its own separate submissions on the matters distinct to them. The fact that different parties are entitled to raise a similar defence to a proceeding is not the type of circumstance to which the Court of Appeal was referring in Althaus v Australian Meat Holdings Pty Ltd[8] at [1] to [6]. Nothing about the conduct of the proceeding before me “smacks of luxury” in the way described by the court in Althaus’ case.
- [11]In the circumstances, there is no good basis for the alternative orders sought by the applicant set out at [4] above. The respondents should have their costs on the standard basis.
- [12]I order that SFP pay the respondents’ costs of the interlocutory applications filed on 18 April 2024 on the standard basis.
Footnotes
[1]UCPR r 681.
[2]Oshlack v Richmond River Council (1998) 193 CLR 72 at 97 [67].
[3]SFP Events Pty Ltd v Little Swamp II, Inc & Anor [2024] QSC 132 at [77] (“Primary Judgment”) at [77].
[4]Oshlack’s Case at [67].
[5]Primary Judgment at [107].
[6]Oshlack’s Case at [67]–[68].
[7][2021] QCA 39.
[8][2006] QCA 499.