Lava Limited v Avery [2009] NSWSC 237

Lava Limited v Avery [2009] NSWSC 237

Clause 21.2 of the Mortgage plainly and unambiguously gave the plaintiff a contractual entitlement to indemnity costs upon default, and the Court's discretion should ordinarily reflect that right. Although the statement of claim did not plead costs on the contractual basis and therefore only supported ordinary costs initially, from Mr Gibson's affidavit filed on 11 June 2008 the defendant was on notice that the claim for costs was founded on clause 21.2 of the Mortgage. Together with the late withdrawal of the defence and cross-claim, this justified ordering ordinary costs up to and including 11 June 2008 and indemnity costs from 12 June 2008.

Jurisdiction
Australia
Judgment Date
02 April 2009
Procedural Posture
Costs Mortgage Agreement Contractual Entitlement to Indemnity Costs / Judgment on Costs After Costs Were Reserved
Outcome
The defendant was ordered to pay the plaintiff's costs on an ordinary basis up to and including 11 June 2008 and on an indemnity basis from 12 June 2008.
Legal Topics
['contractual Entitlement to Indemnity Costs' "court's Discretion as to Costs" 'pleadings' 'late Withdrawal of Defence and Cross Claim']
['civil Procedure' 'costs' 'mortgage Law'] ['contractual Entitlement to Indemnity Costs' "court's Discretion as to Costs" 'pleadings' 'late Withdrawal of Defence and Cross Claim']

Case Brief

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Procedural Posture

Costs Mortgage Agreement Contractual Entitlement to Indemnity Costs / Judgment on Costs After Costs Were Reserved

Legal Issues

  1. 1 ['Whether the plaintiff was entitled to an order that the defendant pay its costs on an indemnity basis pursuant to the Loan Agreement and the Mortgage.' "Whether the plaintiff's failure to plead a contractual claim for indemnity costs in the statement of claim affected the exercise of the Court's discretion as to costs." "Whether the defendant's late withdrawal of her defence and cross-claim was relevant to the costs discretion."]

Ratio Decidendi

Clause 21.2 of the Mortgage plainly and unambiguously gave the plaintiff a contractual entitlement to indemnity costs upon default, and the Court's discretion should ordinarily reflect that right. Although the statement of claim did not plead costs on the contractual basis and therefore only supported ordinary costs initially, from Mr Gibson's affidavit filed on 11 June 2008 the defendant was on notice that the claim for costs was founded on clause 21.2 of the Mortgage. Together with the late withdrawal of the defence and cross-claim, this justified ordering ordinary costs up to and including 11 June 2008 and indemnity costs from 12 June 2008.

Court Disposition

The defendant was ordered to pay the plaintiff's costs on an ordinary basis up to and including 11 June 2008 and on an indemnity basis from 12 June 2008.

Orders

  • ["The Court orders that the defendant pays the plaintiff's costs of the proceedings on an ordinary basis up to and including 11 June 2008." "The Court orders that the defendant pays the plaintiff's costs of the proceedings on an indemnity basis from 12 June 2008."]