TTE PTY LTD & ANOR v KEN DAY PTY LTD
Supreme Court of the Northern Territory of Australia Martin J.
12 March, 29 May 1990

COSTS - Interlocutory application - Object of rules - Exceptional circumstances needed to exercise discretion - Costs no longer follow success - Taxation and payment - Reasonable anticipation of proceedings - Supreme Court Rules r. 63.02, 63.03, 63.04, 63.10, 63.18, 63.20

Counsel for the Plaintiffs Solicitors for the Plaintiffs

Counsel for the Defendant Solicitors for the Defendant

D Mildren QC
Waters James & O'Neil

BJ	Cassells G J Stirk

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IN THE SUPREME COURT
OF THE NORTHERN TERRITORY OF AUSTRALIA

No. 360 of 1988

BETWEEN:
TTE PTY LTD
First Plaintiff

AND:
OSTERMEYER NOMINEES PTY LTD
Second Plaintiff

AND:
KEN DAY PTY LTD
Defendant

CORAM:	MARTIN J.

REASONS FOR JUDGMENT
(Delivered 29 May 1990)

On 28 December 1989, this case was set down for hearing for 3 days commencing on 12 March 1990.	On 12 March a number of applications were made on summonses concerning pleadings, parties and other matters, which after argument and consideration led to the trial dates being abandoned and orders being made by consent for the future conduct of the proceedings.	Orders were also made, by consent, that the defendant pay the plaintiffs' costs of and incidental to the hearing of the summonses, and costs thrown away or occasioned by reason of the adjournment of the trial.

The plaintiffs sought further orders that the costs awarded to them be taxed and paid by the defendant before the conclusion of the proceedings.	An order in those terms is required if a party in whose favour an interlocutory order for costs has been made wishes to proceed to taxation at an earlier stage (r. 63.04(3)&(4)).

Those sub-rules together with r. 63.18, which provides that each party shall pay his own costs of interlocutory proceedings, unless the Court otherwise orders, mark a radical departure from practice relating to costs prior to the commencement of the rules on 1 February 1988.	Prior to then a party in whose favour an interlocutory order had been made would normally have expected to have an order for his costs of the application. It was then up to that party as to when the costs were taxed and the amount found due enforced.	Under the current rules a successful party on an interlocutory application must bear his own costs unless the Court otherwise orders, and even when such an order is made may not proceed to taxation and recovery, until the conclusion of the proceedings unless it appears to the Court that the costs ought to be taxed at an earlier stage, and so orders.

Experience shows that in many, if not most, actions which are contested, there are likely to be interlocutory applications on both sides.	More often than need be those

applications are opposed, whereas with just a little thought and reasonable concessions, the terms of appropriate orders might well be able to be negotiated and resolved by consent. That would avoid the expense to the parties attendant upon a contested hearing and, I might add, the substantial expense to the public purse arising from unnecessarily wasted court time.

Except in extraordinary cases it is more likely than not that during the pre-trial processes each side will have obtained interlocutory orders against the other, either by consent or otherwise.	The policy behind the rules seems to acknowledge those probabilities.	That is, at the end of the day it is likely that in the ordinary course of events each side would have obtained and been obliged to comply with such orders.	The object of the rule is to discourage unnecessary applications and promote agreement.	It acknowledges that orders for costs may be used oppressively.

Generally, costs are in the discretion of the Court (r. 63.03).	The Court may exercise its power and discretion as to costs at any stage of the proceedings or after the conclusion of the proceedings (r 63.04), including in relation to costs reserved (see definition r. 63.02), although in that regard application must be made within 21 days after the conclusion (r. 63.20).

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Rule 63.10 provides, inter alia, that where the Court makes an order for the payment of costs, the costs may be taxed without an order for taxation, but that rule, being in general terms, is subject tor. 63.04(3).

Mention has already been made of the radical departure from past practice introduced by these particular rules.	Such a departure implies a distinct reversal of thinking about costs in interlocutory matters and that leads to the view that there must be something exceptional about the circumstances of the interlocutory application under consideration to lead the Court, in the exercise of its discretion, to make an order as to costs, taxation and payment.

Given the tenor of the rules, it would not be just to make interlocutory orders for costs, or if made to order that they may be taxed earlier than completion of--the proceedings, with a view to punishing  the unsuccessful party.	To do so may engender a reluctance in parties to properly ventilate their problems during the pre-trial process.		What is required is an approach which seeks to have a successful party reimbursed the expense of interlocutory  proceedings which, for example, would have been unnecessary if the other side had acted reasonably or which are unnecessarily burdensome or which are made at a time, such as here, when that party has been deprived of the

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value of the work done in preparation of his case for trial. In such instances, and the list is not intended to be definitive or complete, it may well be within the Court's discretion to exercise the power to override the principles established by the rules.

Costs in interlocutory matters no longer follow success.	No order as to costs ought to be made against the unsuccessful party, in the usual run of cases, even if contested, if the grounds of the application or resistance, as the case may be, are reasonable.	However, if such application or resistance is without real merit, as if often the case, the successful party should not have to bear his costs.

As to taxation and payment of interlocutory costs ordered to be paid by one party to another, a just approach to take is to consider whether the successful party ought to have reasonably anticipated interlocutory proceedings of the kind in question.	If so, then he should have anticipated bearing the expense, at least to the conclusion of the proceedings, and not reckoned on having it paid for by the other party.	If, however, the kind of interlocutory application or the number of them could not have been so anticipated, then there may be a better case for ordering that the successful party's costs be taxed and paid earlier.

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These remarks are not altogether necessary for the decision required in this matter, but, as I have resisted making orders for costs in interlocutory applications since the commencement of the current rules until hearing argument, and no argument has so far been put forward, I considered it better that I should endeavour to formulate some ideas and let them be known.	They might assist parties before me, at least, in putting arguments which bear upon the discretions to avoid the starting point prescribed in the rules.

The defendant's concession that it be liable for the plaintiffs' costs indicates an appreciation of the circumstances in which a party might expect to have an order made against him.	It had failed to properly plead the case it wished to put before the Court, sought to amend a counterclaim at the last minute and had not joined all of the parties against whom it sought relief.	It was as a result of its action or inaction that the time of the other parties was engaged and the trial dates abandoned.	It would not be reasonable to expect the plaintiffs to have anticipated the costs attendant upon the hearing of these summonses and the vacating of the trial dates.

Those costs ought to be taxed earlier than the conclusion of the proceeding.	Order accordingly, the costs may be taxed at any time.