H, AW v K, S [2023] SASCA 49

Appellant: H, AW Counsel: MR D CARUSO - Solicitor: OMNIAD LEGAL Respondent: K, S Counsel: MR J MARSH - Solicitor: ANGELA FERDINANDY Hearing Date/s: 10/05/2023 File No/s: CIV-22-006300 B SUPREME COURT OF SOUTH AUSTRALIA (Court of Appeal: Civil) DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment. The onus remains on any person using material in the judgment to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court in which it was generated. H, AW v K, S [2023] SASCA 49 Judgment of the Honourable President Livesey (ex tempore) 10 May 2023 PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - GENERAL MATTERS - NATURE OF COSTS: INDEMNITY DOCTRINE PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - SECURITY FOR COSTS The successful respondent to an appeal, H, AW v K, S [2023] SASCA 26, sought the payment out of security paid into court by the appellant. The appellant contested the application, contending that payment out can only be made in satisfaction of the costs order made by the Court of Appeal. Held (Livesey P) allowing the application for payment out to the respondent and ordering that the appellant pay the respondent’s costs of the application on an indemnity basis: 1. Security for costs operates as a form of protection on account of the costs to be incurred. It is not in any sense a substitute for the right to claim costs. 2. By failing to agree to an order for payment out to the respondent and contesting the application, the appellant embarked on a course that must be described as both unreasonable and hopeless. Uniform Civil Rules 2020 (SA) r 114.4, 194.3, referred to. Allstate Life Insurance Co & Ors v Australia and New Zealand Banking Group Ltd & Ors (No 19) (1995) 134 ALR 187; Eastgate Properties Pty Ltd v J Hutchinson Pty Ltd [2005] QCA 342; Emanuel Management Pty Ltd (in liq) v Foster's Brewing Group Ltd [2003] QCA 552; Freedom Foods [2021] FCA 461; GB Procon Ltd v Provincial Building Co Ltd [1984] 2 All ER 368; H, AW v K, S (No 2) [2022] SASCA 88; H, AW v K, S [2023] SASCA 26; Viscarello v Livesey [2014] SASCFC 40, considered. -- 1 of 4 -- -- 2 of 4 -- H, AW v K, S [2023] SASCA 49 Court of Appeal – Civil LIVESEY P: 1 By an application dated 17 April 2023 the successful respondent to this appeal seeks the payment out of security paid into court by the appellant.1 2 The payment of security had been ordered on 1 September 2023 on account of the respondent’s costs of the appeal.2 On 16 March 2023 the respondent was awarded her costs of the appeal by the Court of Appeal.3 3 The appellant contends that payment out can only be made in satisfaction of the costs order made by the Court of Appeal. 4 Security for costs operates as a form of protection on account of the costs to be incurred. It is not in any sense a substitute for the right to claim costs. 5 The courts have traditionally approached the determination of the amount of security which is given with a degree of conservatism:4 Courts have traditionally been conservative in relation to the quantum of orders for security for costs. Historically the English practice was to award security in an amount equivalent to two thirds of the estimated party and party costs. That course was abandoned as a general practice following the decision of the Court of Appeal in GB Procon Ltd v Provincial Building Co Ltd.5 Nonetheless the approach tends to be generally conservative as illustrated by the decision of this Court in Murchie v The Big Kart Track Pty Ltd (No 2) at paragraphs [16] and [17].6 6 In part that is because, while the courts estimate the costs to be incurred for the purposes of giving security, that estimation is not a taxation of the costs incurred.7 The assessment made by Bleby JA last year for the purposes of ordering 1 Payment out is addressed by r 114.4(1)(a) of the Uniform Civil Rules 2020 (SA). 2 H, AW v K, S (No 2) [2022] SASCA 88 (Bleby JA). His Honour ordered security in the amount of $25,000 where estimates exceeding $35,000 had been offered. The appellant’s claim for costs now exceeds $140,000. 3 H, AW v K, S [2023] SASCA 26 (Livesey P, Doyle and Bleby JJA). 4 See for example Emanuel Management Pty Ltd (in liq) v Foster's Brewing Group Ltd [2003] QCA 552, [16] (Dutney J, with whom Jerrard JA and Philippides J agreed). See also Eastgate Properties Pty Ltd v J Hutchinson Pty Ltd [2005] QCA 342, [ (Keane JA, with whom McPherson and Jerrard JJA agreed). 5 GB Procon Ltd v Provincial Building Co Ltd [1984] 2 All ER 368. See also Bruce Pie & Sons Pty Ltd v RH Mainwaring, English and Peldan [1985] 1 Qd R 401 (McPherson J) and Allstate Life Insurance Co & Ors v Australia and New Zealand Banking Group Ltd & Ors (No 19) [1995] FCA 1778; (1995) 134 ALR 187 at 197 - 201. 6 Murchie v The Big Kart Track Pty Ltd (No 2) [2003] 1 Qd R 528, 530. 7 Viscarello v Livesey [2014] SASCFC 40, [53] (Peek J, with whom Bampton and Parker JJ agreed): “It is quite usual for a Judge to take a conservative approach and order an amount for security for costs which is later substantially exceeded on an ultimate taxation of costs”. -- 3 of 4 -- [2023] SASCA 49 Livesey P 2 security concerned the amount in which it was proper to order security for costs.8 It was not in any sense a taxation, prospective or otherwise. 7 The concern now expressed by the appellant about the amount claimed for costs by the respondent may be understandable but that is a matter for the taxing officer. 8 In the circumstances, the Court will make an order for the payment out to the respondent in terms of the minutes of order provided. The amount to be recovered for the respondent’s costs of the appeal must be determined by agreement or taxation in accordance with r 195.1 (and following) of the Uniform Civil Rules 2020 (SA). 9 By failing to agree to an order for payment out to the respondent and contesting the application, the appellant embarked on a course which must be described as both unreasonable and hopeless.9 10 In the circumstances, it is appropriate to order that the appellant pay the respondent’s costs of this application on an indemnity basis. 8 H, AW v K, S (No 2) [2022] SASCA 88, [42]-[44] (Bleby JA). See for example Freedom Foods Pty Ltd v Blue Diamond Growers [2021] FCA 461, [36]-[39] (Allsop CJ), where in the context of a security application it was recognised that the proper assessment of reasonable costs is “not intended to be a full indemnity”. 9 See r 194.3(1)(a) of the Uniform Civil Rules 2020 (SA); Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Ltd (1998) 81 ALR 397, 401 (Woodward J); Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 (Sheppard J). -- 4 of 4 --