Manildra Laboratories v Campbell [2010] NSWSC 70

Manildra Laboratories v Campbell [2010] NSWSC 70

The plaintiffs' final constructive knowledge case against Young was not so obviously hopeless that it should never have been put, and the plaintiffs were not absolutely precluded from advancing it merely because they had called Mr Murphy and relied on his affidavit. Although the first three bases for imputing knowledge could not succeed, their hopelessness did not sufficiently infect the decision to persist with the fourth category case. The indemnity costs application was a discrete application, so its costs followed the event of that application.

Jurisdiction
Australia
Judgment Date
05 February 2010
Procedural Posture
Application for Indemnity Costs / Consequential Orders Following Earlier Reasons Given on 23 September 2009
Outcome
The second and third defendants' application for indemnity costs was dismissed, and they were ordered to pay the plaintiffs' costs of that application.
Legal Topics
['indemnity Costs' 'hopeless Case' 'knowingly Assisted Breach of Fiduciary Duty' 'constructive Knowledge' 'calling Opposing Party as Witness' 'evidence by Affidavit']
['costs' 'equity' 'commercial Litigation'] ['indemnity Costs' 'hopeless Case' 'knowingly Assisted Breach of Fiduciary Duty' 'constructive Knowledge' 'calling Opposing Party as Witness' 'evidence by Affidavit']

Case Brief

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Procedural Posture

Application for Indemnity Costs / Consequential Orders Following Earlier Reasons Given on 23 September 2009

Legal Issues

  1. 1 ["Whether the plaintiffs should be ordered to pay the second and third defendants' costs on an indemnity basis because the plaintiffs knew or should have known that the case against those defendants was hopeless." 'Whether the plaintiffs were precluded from maintaining a constructive knowledge case against the second and third defendants after calling Mr Murphy as a witness and relying on his affidavit.' 'Whether the costs of the indemnity costs application should follow the outcome of that discrete application or the overall proceedings.']

Ratio Decidendi

The plaintiffs' final constructive knowledge case against Young was not so obviously hopeless that it should never have been put, and the plaintiffs were not absolutely precluded from advancing it merely because they had called Mr Murphy and relied on his affidavit. Although the first three bases for imputing knowledge could not succeed, their hopelessness did not sufficiently infect the decision to persist with the fourth category case. The indemnity costs application was a discrete application, so its costs followed the event of that application.

Court Disposition

The second and third defendants' application for indemnity costs was dismissed, and they were ordered to pay the plaintiffs' costs of that application.

Orders

  • ["I order that the second and third defendants' application for indemnity costs be dismissed." "I order the second and third defendants to pay the plaintiffs' costs of that application."]