Citi Project Marketing (Qld) Pty Ltd v VG Projects Pty Ltd [2017] QSC 150

SUPREME COURT OF QUEENSLAND CITATION: Citi Project Marketing (Qld) Pty Ltd and Anor v VG Projects Pty Ltd and Ors [2017] QSC 150 PARTIES: CITI PROJECT MARKETING (QLD) PTY LTD ACN 602 230 419 (first applicant) SAMSARA ONE PTY LTD ACN 162 172 205 (second applicant) v VG PROJECTS PTY LTD ACN 1250 396 311 (first respondent) CHRISTOPHER JOHN VITALE (second respondent) PAUL GEDOUN (third respondent) POINTCORP HOLDINGS PTY LTD ACN 168 808 151 (fourth respondent) SAMUEL BRIAN PATTERSON (fifth respondent) FILE NO/S: BS No 12975 of 2016 DIVISION: Trial Division PROCEEDING: Application ORIGINATING COURT: Supreme Court at Brisbane DELIVERED ON: 14 July 2017 DELIVERED AT: Brisbane HEARING DATE: Written submissions were provided. JUDGE: Martin J ORDER: 1. The second applicant and the fifth respondent pay the costs of the first, second, third and fourth respondents in both applications. 2. The second applicant and the fifth respondent pay the costs of the first, second, third and fourth respondents in the interlocutory hearings of 3, 6 and 12 January 2017. CATCHWORDS: PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – GENERAL RULE: COSTS FOLLOW EVENT – GENERAL PRINCIPLES AND EXERCISE OF DISCRETION – where the second applicant and fifth respondent applied for an order winding up the first applicant – where that application was dismissed -- 1 of 5 -- 2 – where the second, third and fourth respondents applied for a declaration that an extraordinary general meeting was valid – where that declaration was made – whether the second applicant and the fifth respondent should pay the costs of the first, second, third and fourth respondents PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – COSTS RESERVED – ALLOWANCE OF RESERVED COSTS AFTER JUDGMENT – where costs were reserved at interlocutory hearings – where the second, third and fourth respondents seek an order that the second applicant and fifth respondent pay their costs for those interlocutory hearings – where the parties are involved in a number of other disputes – whether the second applicant and fifth respondent ought to pay the first, second, third and fourth respondent’s costs for the interlocutory hearings PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – PARTIES AND NON- PARTIES – COSTS IN PROCEEDINGS WHERE MULTIPLE PARTIES – where the fifth respondent did not appear in either application – whether the fifth respondent should pay the successful parties’ costs – where the first, second, third and fourth respondent seek an order that the second applicant and fifth respondent pay the first applicant’s costs – whether the second applicant and fifth respondent ought to pay the first applicant’s costs Uniform Civil Procedure Rules 1999 Citi Project Marketing (Qld) Pty Ltd v VG Projects Pty Ltd [2017] QSC 65 Hobbs & Anor v Oildrive Pty Ltd [2008] QSC 52 COUNSEL: D Savage QC and M Jones for the second applicant and fifth respondent P Dunning QC and M D Alexander for the second, third and fourth respondents SOLICITORS: Tucker & Cowen for the second applicant and fifth respondent HWL Ebsworth for the second, third and fourth respondents [1] On 28 April 2017, I made the following orders: (a) That the application seeking an order winding up Citi Project Marketing (Qld) Pty Ltd be dismissed; and -- 2 of 5 -- 3 (b) It be declared that the extraordinary general meeting of Citi held on 24 December 2016, and the resolutions passed at it, were valid. [2] The history of the dispute between the parties is set out in my reasons of 28 April 2017.1 [3] I allowed the parties to make written submissions on the question of liability for costs. [4] At the hearing of the two applications – the winding up application and the application under s 1322 of the Corporations Act 2001 – Mr Patterson did not appear. [5] The application for the winding up of Citi was made by Samsara and Patterson. That application failed. Samsara concedes that an order should be made that it pay the costs of the second, third and fourth respondents of and incidental to that application. It also concedes that it should pay the costs of Pointcorp so far as they relate to the s 1322 application. [6] VG Projects, Vitale, Gedoun and Pointcorp (“the VG parties”) seek orders that Patterson and Samsara pay their costs of both applications including but not limited to appearances on:  3, 6 and 12 January 2017;  3 and 23 February 2017;  17 March 2017; and  28 April 2017. [7] Although Patterson did not appear on the application, he remained an applicant on the winding up application and a respondent in the s 1322 application and thus is liable to an order for costs. The solicitors for Samsara submit that the winding up application was not prosecuted by Patterson personally and note that counsel did not appear for him upon the hearing on 3 February 2017. Nevertheless, I was not directed to any order removing him from the proceedings or anything which suggested he had withdrawn. [8] The application to wind up was resisted by the VG parties. They were wholly successful. There is no reason that costs should not follow the event. 1 See Citi Project Marketing (Qld) Pty Ltd v VG Projects Pty Ltd [2017] QSC 65. -- 3 of 5 -- 4 [9] The application under s 1322 of the Corporations Act was prosecuted by the VG parties. Again, they were successful. There is no reason that costs should not follow the event. [10] The VG parties also seek orders with respect to interlocutory hearings. It is submitted, correctly, by Samsara that the s 1322 claim was only one of a number of claims made against Citi and Patterson in relation to various other claims. They have not yet been determined. Samsara argues that there is no basis on which to determine the reserved costs as the relief sought, namely the damages claim against Citi and Patterson, as well as the claim asserting breach of statutory and fiduciary duty, have not been determined. So far as it goes, that is correct. But, the interlocutory applications were necessary for the purposes of preserving the status quo. A failure to do so would most likely have rendered the s 1322 application nugatory. It is not enough to say that the interlocutory applications were interlocutory to other relief. It is clear that they were necessary for the relief upon which the respondents were successful and they should, as a result, get their costs now. [11] The VG parties also seek costs with respect to hearings conducted on 23 February and 17 March, that is, after this matter was heard but before judgment was given. In each of the orders which emerged from those hearings (one of which, at least, was made by consent) it was specifically noted that no orders as to costs was made. In other words, the costs of those matters have been dealt with. That was not drawn to my attention in the submissions from the VG parties. [12] The VG parties also sought an order that Patterson and Samsara pay any costs separately incurred by Citi. Citi did not appear on the application nor did it seek to make submissions for itself on the question of costs. No order will be made with respect to Citi. [13] The VG parties also sought an order that it be “certified that it was necessary for “Queen’s Counsel and Junior Counsel to be retained”. This type of order has been made in the past, but is now properly regarded as “a relic of the procedure provided for under the previous -- 4 of 5 -- 5 Rules of the Supreme Court”.2 In any event, no submissions were made in support of this proposed order and the matter is something which a costs assessor must consider.3 [14] Patterson was the controlling mind of Samsara and, as the respondents point out, the applications were the two sides of the same coin. In those circumstances it is appropriate that Samsara and Patterson bear the costs in relation to both applications including reserved costs. Orders [15] I make the following orders: 1. The second applicant and the fifth respondent pay the costs of the first, second, third and fourth respondents in both applications. 2. The second applicant and the fifth respondent pay the costs of the first, second, third and fourth respondents in the interlocutory hearings of 3, 6 and 12 January 2017. 2 Hobbs & Anor v Oildrive Pty Ltd [2008] QSC 52 at [4]. 3 See Uniform Civil Procedure Rules 1999 r 721. -- 5 of 5 --