Dutt v Attorney-General of Fiji [1998] FJHC 170; Hbc0437d.98s (1 December 1998)

Fiji Islands - Dutt v The Attorney-General of Fiji - Pacific Law Materials

IN THE HIGH COURT OF FIJI

AT SUVA

CIVIL JURISDICTION

CIVIL ACTION NO. 437 OF 1998

BETWEEN:

:

CHANDAR DUTT
f/n Ramaiya
Plaintiff

AND:

THE ATTORNEY-GENERAL OF FIJI
Defendant

Mr. E. Walker for the Defendant

DECISION
(on Indemnity Costs application)

This is the plaintiff's applicationcosts on an indemnity basisbasis consequent upon a consent order which I made on 26 October 1998 ordering that the Commissioner of Stamp Duties had acted incorrectly in refusing to grant exemption from stamp duties on a 'Mortgage' lodged for stamping by the Plaintiff at her office and that the plaintiff is entitled to exemption from stamp duties on the said 'Mortgage' lodged by him with the Commissioner of stamp duties for stamping AND it was further ordered that the costs be awarded to the plaintiff in any event, the amount to be determined after considering submissions from both counsel.

The only matter left to be decided is whether the plaintiff is entitled to costs on an indemnity basis.

I have helpful written submission from both counsel on the issue before me in this regard.

The plaintiff is asking for payment to him in the sum of $1100 by way of costs on an indemnity basis. His grounds are as hereunder (as stated in Mr. Parshotam's submission):

1. The Commissioner of Stamp Duties had no basis in law whatsoever to reject the Plaintiff's application for exemption from stamp duties.

2. The Commissioner of Stamp Duties acted in an arbitrary and capricious manner.

3. The Commissioner of Stamp Duties delayed in her decision.

4. The Commissioner of Stamp Duties did not reply to the Plaintiff's letter of 2/9/98.

5. The delay caused by the Commissioner of Stamp Duties jeopardised the Plaintiff's property in that ANZ Bank threatened to sell the same as mortgagee if its debt was not paid off and the Plaintiff could not pay the ANZ debt off until the NBF mortgage was stamped, his funds from NBF being in place to pay off ANZ Bank.

6. The Plaintiff has had to have representation in Court on three (3) occasions.

7. The Defendant did not give any prior notice to the Plaintiff that it would be seeking an adjournment to his first two (2) dates even though the matter was set down for hearing on both these occasions and the Plaintiff was ready to proceed.

8. The Plaintiff has incurred $150.00 (+VAT) in court filing fees alone.

9. All such costs would have been avoided if the Commissioner of Stamp Duties had adopted a more sensible approach to the Plaintiff's application for exemption.

Mr. Parshotam has referred the court to the Court of Appeal case of SCHERER v COUNTING INSTRUMENTS LTD (1986) 1 WLR 615 and pp 621-2 in which principles relating to award of costs are laid down.

The learned counsel for the defendant submits that he does not dispute that the plaintiff is entitled to costs but not on an 'indemnity basis'.

Determination of the issue

There is ample provision in The High Court Rules 1988 under Or 62 for the award of costs on an indemnity basis.

As to the meaning of "indemnity costs" and its applicability and availability it was discussed in the Court of Appeal case of STATE v THE POLICE SERVICE COMMISSION Ex parte BENIAMINO NAIVELI Civ. App. No. 52 of 1995S (delivered 16.8.96). The Appeal Court upheld an award of 'indemnity costs' given by SCOTT J in that such an award was "an award in terms of or 62 r.26(1)" of The High Court Rules which concerns "costs payable to a barrister and solicitor by his own client which allows for all costs except in so far as they are of an unreasonable amount or have been unreasonably incurred". There the Appeal Court further stated, inter alia, that "additional costs may be called for if there has been reprehensible conduct by the party liable". Also in E.M.I. RECORDS LTD v IAN CAMERON WALLACE LTD & ANOTHER 1982 3 WLR 245 at 259 SIR ROBERT MEGARRY VC sitting with assessors summarised his conclusions on order for costs and said, inter alia, that "(4) The court has power to order costs to be paid on the solicitor and own client basis as between litigating parties ..."

I have looked very closely at the facts of this case and find that the defendant or more correctly the Commissioner of Stamp Duties delayed finalisation of the transaction in question. However, no sooner the action commenced the defendant quite properly looked seriously into the question of stamp duty and quickly consented to a consent order.

This is not a case which I would say was an abuse of process and unmeritorious behaviour by the losing party to warrant a sanction by way of an indemnity costs. If allowed it could easily open the floodgates. The defendant could not be penalised by exercising his rights to dispute matters and behaved quite properly in defending the action initially and then without wasting much more time consented to an Order. In this context the following words of BELDAM L.J. in WILLIS v REDBRIDGE HEALTH AUTHORITY (1996 1 WLR 1228 at 1232 C.A.) are apt on the misuse of the process of the court:

"Secondly, I would emphasise that the purpose of an order that one party should pay the other's costs on an indemnity basis is not penal but compensatory and, where one party causes another to incur legal costs by misusing the process to delay or to defer the trial and payment of sums properly due, the court ought to ensure so far as it can that the sums eventually recovered by a plaintiff are not depleted by irrecoverable legal costs."

Also to show the circumstances in which indemnity costs are given I refer to the following passage from the judgment of KIRBY P in DILLON AND OTHERS v BALTIC SHIPPING CO (THE "MIKHAIL LERMONTOV")(Sup. Ct. of NSW Ct of Appeal) 1990 2 L.L.R. 155 at 176 which is apt:

"In a series of cases it has been suggested that the order of costs on a solicitor and client basis should be reserved to a case where the conduct of a party or its representatives is so unsatisfactory as to call out for a special order. Thus, if it represents an abuse of process of the Court the conduct may attract such an order See e.g. Packer v. Meagher, [1984] 3 N.S.W.L.R. 486. See also Australian Guarantee Corporation Ltd. v. De Jagr, [1984] VicRp 40; [1984] V.R. 483. This is the order which this Court ultimately made in Premier Woodworking when an appellant belatedly withdrew an unmeritorious appeal".

To conclude, bearing in mind the facts of this case, the authorities and the factors which ought to be taken into account in considering the application for an order of costs on an indemnity basis, I do not consider this to be a case in which the conduct of the defendant was unmeritorious or reprehensible to permit of a departure from the standard basis in awarding costs.

For these reasons the application for costs on an indemnity basis fails, but I order the defendant to pay the plaintiff's costs in the sum of $350.00 inclusive of disbursements.

D. Pathik
Judge

At Suva
1 December 1998

Hbc0437d.98s