Ringrow Pty Limited v BP Australia Pty Limited [2006] FCA 1446

Ringrow Pty Limited v BP Australia Pty Limited [2006] FCA 1446

BP is contractually entitled to recover from Ringrow and the guarantors the costs and disbursements reasonably and in good faith incurred in defending and cross-claiming in the Federal Court proceedings at first instance under the POSA indemnity clauses, on an indemnity basis, but is not entitled to recover costs relating to the appeals to the Full Federal Court or High Court or costs relating to the enforcement of the option deed, as those do not arise from defaults under the POSA nor do the indemnity clauses of the POSA extend to those costs. The contractual right to costs is not estopped by prior curial costs orders.

Parties
First Applicant: Ringrow Pty Limited; Second Applicant: Ultimate Fuel Pty Limited; Third Applicant: Nader-One Pty Limited; Fourth Applicant: Joseph Nader; Fifth Applicant: Richard Nader; Sixth Applicant: Ziad Nader; Seventh Applicant: Rochelle Nader; Eighth Applicant: Joseph Peter Ayoub; Respondent: BP Australia Pty Limited
Jurisdiction
Australia
Judgment Date
07 November 2006
Procedural Posture
Civil / Post Judgment Application Regarding Recovery of Legal Costs Under a Contractual Indemnity
Outcome
BP is entitled to recover from Ringrow and the guarantors its indemnity costs of defending and cross-claiming in the Federal Court at first instance, but not costs of appeals or exercise of the option, with final orders to be settled after hearing the parties on costs.
Legal Topics
Contractual Indemnity for Costs, Effect of Curial Costs Order, Interpretation of Indemnity Clauses, Guarantor's Liability for Costs
Contracts Civil Procedure Costs Contractual Indemnity for Costs Effect of Curial Costs Order Interpretation of Indemnity Clauses Guarantor's Liability for Costs

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Parties

Ringrow Pty Limited

First Applicant

Ultimate Fuel Pty Limited

Second Applicant

Nader-One Pty Limited

Third Applicant

Joseph Nader

Fourth Applicant

Richard Nader

Fifth Applicant

Ziad Nader

Sixth Applicant

Rochelle Nader

Seventh Applicant

Joseph Peter Ayoub

Eighth Applicant

BP Australia Pty Limited

Respondent

Procedural Posture

Civil / Post Judgment Application Regarding Recovery of Legal Costs Under a Contractual Indemnity

Legal Issues

  1. 1 Whether BP is estopped by prior court costs orders from recovering costs from Ringrow under a contractual indemnity
  2. 2 Whether BP can recover as damages (under the contract) its costs of litigation, including appeals, or only costs in the Federal Court proceedings at trial
  3. 3 Whether the guarantors are liable to BP for such costs pursuant to their guarantee and indemnity

Ratio Decidendi

BP is contractually entitled to recover from Ringrow and the guarantors the costs and disbursements reasonably and in good faith incurred in defending and cross-claiming in the Federal Court proceedings at first instance under the POSA indemnity clauses, on an indemnity basis, but is not entitled to recover costs relating to the appeals to the Full Federal Court or High Court or costs relating to the enforcement of the option deed, as those do not arise from defaults under the POSA nor do the indemnity clauses of the POSA extend to those costs. The contractual right to costs is not estopped by prior curial costs orders.

Court Disposition

BP is entitled to recover from Ringrow and the guarantors its indemnity costs of defending and cross-claiming in the Federal Court at first instance, but not costs of appeals or exercise of the option, with final orders to be settled after hearing the parties on costs.

Orders

  • 1. Cross-claimant (BP) is not estopped by curial costs order from making a contractual claim for costs.
  • 2. Ringrow is liable to indemnify BP in respect of all costs and disbursements incurred by BP in proceedings N278 of 2003 before the Federal Court at first instance but not in N2519 of 2003 (Full Court) nor S291 of 2005/S339 of 2004 (High Court).