DISTRICT COURT OF QUEENSLAND
CITATION:
Mamouzelos v Headline Advertising Pty Ltd & Anor [2017] QDC 36
PARTIES:
CHRISTOS MAMOUZELOS
(plaintiff)v
HEADLINE ADVERTISING PTY LTD
ACN 070 802 210
(first defendant)and
DAVID BRUCE LISTER
(second defendant)FILE NO/S:
D298/15
DIVISION:
Civil
PROCEEDING:
Application
ORIGINATING COURT:
District Court at Southport
DELIVERED ON:
27 February 2017
DELIVERED AT:
Southport
HEARING DATE:
6 February 2017
JUDGE:
Muir DCJ
ORDER:
Application dismissed.
CATCHWORDS:
COSTS – whether an order for costs thrown away as a result of amendments to pleadings necessary
Uniform Civil Procedure Rules 1999 (Qld), r 386
Uniform Civil Procedure Rules 1999 (Qld), r 4
COUNSEL:
B. Ledger solicitor for the plaintiff
A. I. James counsel for the defendantsSOLICITORS:
Barron & Allen Lawyers for the plaintiff
JHL Lawyers for the defendants
Introduction
This is an application by the defendants pursuant to the Uniform Civil Procedure Rules 1999 (Qld) (“UCPR”) r 386, for an order that the plaintiff pay the defendants’ cost thrown away as a result of amendments to the plaintiff’s statement of claim.
UCPR r 386 states as follows:
“386 Costs
The costs thrown away as a result of an amendment made under rule 378 are to be paid by the party making the amendment unless the court orders otherwise.”
There were exchanges of correspondence leading up to the filing of the application. The first letter was from the defendants’ solicitors to the plaintiff’s solicitors on 19 September 2016, which relevantly said:
“…Prior to proceeding with any next step in the matter, including but not limited to mediation or further litigation, our clients wish to address the issue of their costs thrown away as a result of the amendment of your client’s Statement of Claim…our clients now seek payment of their costs thrown away by the Plaintiff’s amendment, either by agreement by the parties or by order of the Court……Our clients put the Plaintiff on notice that if payment of their costs is not forthcoming they will proceed to make an Application for costs thrown away…our clients have instructed to our office to vigorously pursue their costs prior to the advancement of the case.”[1] [Emphasis added]
[1]Exhibit DF5 to the affidavit of Dawn Francoeur filed 12 December 2016.
On 23 September 2016, the defendants’ solicitors wrote again to the plaintiff’s solicitors, stating that “we look forward to receipt of your client’s advices with respect to payment of the outstanding costs thrown away.”[2]
[2]Exhibit DF6 to the affidavit of Dawn Francoeur filed 12 December 2016.
On 26 September 2016, the plaintiff’s solicitors responded to this correspondence as follows:
“…In respect to the issue of costs, which we see as nothing more than a delaying tactic, your client appears to have forgotten that your client also filed and served an Amended Defence trying to withdraw the numerous deemed admissions in the first defective defence drafted by your firm just prior to the Summary Judgment Application being heard. Our client is also entitled to its costs as a result of those amendments pursuant to the same rules you have quoted. In respect to those costs they are able to be set off against the costs your client now wishes to pursue and as a result they cancel each other out. As a result there is no legal or commercial utility in proceeding in the manner in which you have advised your client intends to.
If your client wishes to proceed with its pointless intended application seeking an order for costs regarding the minor amendments then we invite you to do so and it will be met at the same time with an application seeking our client’s costs dealing with the late amendments of your clients Defence and the wasted costs following the Amended Defence being served, and also costs for the pointless application your clients now intend to bring.”[3] [Emphasis added]
[3]Exhibit DF7 to the affidavit of Dawn Francoeur filed 12 December 2016.
On 6 October 2016, the defendants’ solicitors wrote to the plaintiff’s solicitors advising that they had been instructed to proceed with an application for costs thrown away and that “If your client is mindful of resolving this matter prior to an Application being made, please contact our office for our client’s costs…”[4]
[4]Exhibit DF9 to the affidavit of Dawn Francoeur filed 12 December 2016.
In correspondence dated 11 October 2016, the plaintiff’s solicitors responded as follows:
“In respect to your client seeking our client to request what your clients’ [sic] costs are, our client has no obligation to seek to ascertain your clients’ costs.
We also note you have failed to respond to the issues of the costs that are owed by you[r] clients to our client under rule 386 UCPR as a result of your client filing and serving its Amended Defence on 18 July 2016 well prior to our client deciding to Amend its Statement of Claim. We note such costs are able to be set off against any costs owed by our client to your clients.Our client does not dispute the meaning of rule 386 UCPR. Its meaning and effect is non-controversial.
As a result of the above, your client’s threatened application makes no legal or commercial sense. There is no utility in proceeding in the manner you have indicated. It will be nothing more than a waste of the court’s time. It will also be nothing more than a waste of our client’s time and costs.” [5] [Emphasis added]
[5]Exhibit DF5 to the affidavit of Dawn Francoeur filed 12 December 2016.
These extracts reveal an antagonistic, unresponsive and unhelpful approach was taken by both sides to the issue of costs thrown away. This conduct was contrary to the overriding philosophy of UCPR r 5 “to facilitate the just and expeditious resolution of the real issues in civil proceedings at a minimum of expense.”
The plaintiff contends that UCPR r 386 does not give the defendants standing to bring the present application. I disagree.
The express use of the words “unless the court orders otherwise,” envisages that there may well be occasions where this rule is quite properly invoked to found an application for an order associated with the costs thrown away on the amendment of a pleading. For example, where a party disputes the meaning or effect of the rule or seeks their costs thrown away on the indemnity basis, or contends that there should be no order as to costs. At one point in this case, the plaintiff encouraged the defendants’ to make the application and suggested there would be a cross application.[6]
[6]Exhibit DF7 to the affidavit of Dawn Francoeur filed 12 December 2016.
The plaintiff did not dispute the meaning or effect of UCPR r 386 but argued that he had a set off for the full amount of the defendants’ costs thrown away. Curiously, at no stage did either party attempt to quantify what in fact their costs thrown away were.
UCPR r 686(b) is relevant to the present case. This rule states that:
“686 Assessment of costs without order
Costs may be assessed without an order for assessment having been made if—
(a)the court orders a party to pay another party’s costs; or
(b) under these rules, a party must pay another party’s costs; or…”
Parts 3 of Chapter 17A of the UCPR sets out a regime which allows for quantifying such costs by (amongst other things) service of a costs statement, objections, and if necessary the appointment of a costs assessor.
In particular, rule 705 provides as follows:
“705 Costs statement
(1) A party entitled to be paid costs must serve a costs statement in the approved form on the party liable to pay the costs.
Note—
See rule 709A for failure to serve a costs statement.
(2) The costs statement must—
(a) contain sufficient details to enable the party liable to pay the costs to understand the basis for the costs, prepare an objection to the costs statement and obtain advice about an offer to settle the costs; and
(b) if practicable, have attached to it copies of all invoices for the disbursements claimed in the costs statement.”
I consider that the present application was unnecessary. There was an acceptance by the plaintiff of the defendants’ entitlement to their costs thrown away under the rules, (albeit that he was not going to pay them because his costs thrown away apparently “cancelled” those costs out). Even if I was inclined to make the order sought, it would be superfluous. The defendants would still be required to follow the assessment process under the rules if they were unable to agree on the amount of costs. No doubt the plaintiff would follow the same process with regard to his alleged entitlement to costs thrown away.[7]
[7]Although I note that the defendants have not accepted such an entitlement exists.
In the present circumstances, the defendants ought to have served a costs statement under UCPR r 705 and the battle ought to have been fought within the fields of Chapter 17A of the UCPR.
I therefore order that the defendants’ application be dismissed.
In my view, the approach of both parties in this application was unfortunate. I have required the parties to appear either by telephone or in person on the delivery of this judgment. I will allow the legal representatives’ time to read my judgment and I will then hear oral argument in relation to the appropriate cost order of the application.