FEDERAL COURT OF AUSTRALIA

Sobey v Commissioner of Taxation [2008] FCA 1621

COSTS – whether applicant should pay the respondent’s costs thrown away by reason of the trial being adjourned and on an indemnity basis – principles relevant to an award of costs – applicant failed to file and serve his complete case in accordance with pre-trial orders and directions – no adequate explanation – applications granted

COSTS – time for taxation and payment of costs – whether the applicant should pay the respondent’s costs forthwith

Federal Court of Australia Act 1976 (Cth) s 43

Federal Court Rules (Cth) O 62  

Ruddock v Vadarlis (No 2) (2001) 115 FCR 229 cited

Andromeda Handelsaktieselskab v Holme (1924) 130 LT 329 cited

Fashion Warehouse Pty Ltd v Pola [1984] 1 Qd R 251 cited

Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225 cited

Re Wilcox: Ex parte Venture Industries Pty Ltd (No 2) (1996) 72 FCR 151cited

Boyapati v Rockefeller Management Corporation (No 2) [2008] FCA 1375 cited

Hamod v New South Wales (2002) 188 ALR 659 referred to

Barrett Property Group Limited v Metricon Homes Pty Ltd (No 2) [2007] FCA 1823 referred to  

ANTHONY SOBEY v COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA

SAD 27 OF 2008

SAD 28 OF 2008

KENNY J

17 november 2008

MELBOURNE

THE COURT ORDERS THAT:

1.                  The applicant pay the respondent’s costs thrown away by reason of the trial of the proceedings being adjourned, including the hearings on 5 and 18 September 2008, such costs to be taxed and paid on an indemnity costs basis.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

REASONS FOR JUDGMENT

INTRODUCTION

1                     These are applications for costs, first, by the Commissioner of Taxation (“the Commissioner”) that Anthony Sobey pay the Commissioner’s costs thrown away by reason of the trial of the proceedings being adjourned, including the hearings on 5 and 18 September 2008. The Commissioner also seeks orders that these costs be paid forthwith and on an indemnity basis.  The Commissioner relies on the affidavit of Stephen Antony Linden sworn on 5 September 2008. Mr Sobey has also sought costs thrown away by reason of the adjournment.  Shortly before the hearing on costs, Mr Sobey’s solicitors filed an affidavit of Effie Kavadas sworn on 16 September 2008 (although this was neither formally tendered nor specifically mentioned in Mr Sobey’s oral or written submissions).

2                     For the following reasons, I would order that Mr Sobey pay the Commissioner’s costs thrown away by reason of the trial of the proceedings being adjourned, including the hearings on 5 and 18 September 2008.  I would further order that these costs be paid on an indemnity basis.

3                     I set out below a procedural history of the proceedings to date since this history is pertinent to the consideration of these costs applications.

BACKGROUND

4                     On 7 March 2008, Mr Sobey lodged two applications in the South Australian District Registry of the Court appealing against the objection decisions of the Commissioner disallowing Mr Sobey’s objections to the Commissioner’s income tax assessments for the years ended 30 June 2004 and 30 June 2005.  The Commissioner’s assessments were made on the basis of tax returns prepared and electronically lodged by Mr Sobey’s then accountant, Mr Gregory Basso.  Briefly stated, as reflected in his amended appeal statement of 11 June 2008, Mr Sobey contends that: (1) the amounts described as interest were in fact returns of capital invested with one Guiseppe Mercorella under a scheme (which, unknown to Mr Sobey at the time of his investment, was a fraudulent ‘Ponzi’ scheme); and that his income was therefore overstated; and (2) the tax returns upon which the Commissioner based his assessments were lodged with the Commissioner without Mr Sobey’s authority.

5                     On Mr Sobey’s motion, the proceedings were transferred to the Victoria Registry of the Court, where they were managed in accordance with the Tax List Directions dated 4 April 2008. On 28 April 2008, the Commissioner filed the documents required by O 52B r 5 of the Federal Court Rules (Cth) (“the Rules”).   Mr Sobey filed his appeal statement on 29 April 2008 (which as indicated above was amended on 11 June 2008) and his preliminary witness list on 30 April 2008.  In this list, he indicated that he proposed to give evidence and to call the following persons: Mr Mark Lipson, Mr S Davies, Mr Greg Basso, Mr Mercorella, Mr N Formichella, an “investigating officer – ASIC” and a “NAB – Bank Officer – Borrowed money loaned to Mercorella and approved bank documents”.

6                     The judge coordinating the Tax List (“the Tax List Judge”) held a scheduling conference on 30 April 2008, at which the Tax List Judge ordered, amongst other things, that: Mr Sobey was: (1) to file and serve any affidavit material on which he intended to rely relating to certain paragraphs of the Commissioner’s appeal statement by 16 May 2008; and (2) to file and serve any affidavit material and submissions on which he intended to rely in relation to the matters referred to in his own appeal statement by 30 May 2008.  Reference to the transcript of the hearing that day shows that the Tax List Judge sought to focus the parties’ attention on the identification of operative issues and efficient preparation for trial.  At this stage, the Tax List Judge encouraged Mr Sobey to get his “house in order as a matter of urgency and put on [his] affidavit material” and declined to make orders for discovery since discovery was likely to be “time consuming and voluminous”.  Finally, the issue of subpoenas was also canvassed when, amongst other things, counsel for Mr Sobey stated that the documents required to complete a forensic accounting analysis were held by the Australian Crime Commission (“ACC”).  The Tax List Judge invited Mr Sobey “[i]n the mean time” to “[d]eliver [subpoenas] up to [Tax List Judge’s] chambers” on the basis that her Honour would “give … leave if … appropriate”.

7                     On 26 May 2008, Mr Sobey’s solicitors filed an affidavit that had been sworn by Mark Lipson, a chartered accountant engaged by Mr Sobey to carry out a prudential audit on the 2004 and 2005 returns of income that Mr Basso purportedly lodged for Mr Sobey.  In this affidavit, Mr Lipson stated that there were deficiencies in the documents on which he based his audit apparently because “most of the relevant accounting records were with Mr Colin Nicol of McGrath [Nicol] and Partners, Chartered Accountants, who had been appointed as liquidators of the Mercorella Ponzi scheme”.  Mr Lipson added that he had been told that “the premises of [Mr Sobey were] raided by the Australian Crime Commission (“ACC”) on 24 August 2004 and that all [Mr Sobey’s] private and business records were seized on that day”. Mr Lipson deposed that he had, however, been able to make findings “based on the amounts actually received into the bank accounts of [Mr Sobey]”.  Mr Lipson added that:

I was told while in conference with [Mr Sobey’s] counsel on Thurday 22 May 2008, that the ACC has returned 10 boxes of documents to [Mr Sobey] seized in the raid in 2004 … and that [Mr Sobey] had received 10 volumes of documents from the liquidator, but as yet I have not had time to examine those documents on behalf of [Mr Sobey].

8                     On 30 May 2008, Mr Sobey’s solicitors filed an affidavit sworn by Mr Sobey, in which (amongst other things) Mr Sobey reiterated that: (1) Mr Basso had lodged returns for 2004 and 2005 in his name but without his authority; (2) Mr Sobey was persuaded by Mr Mercorella and Mr Formichella to appoint Mr Formicella and BCFR Accountants as his tax agents and to invest with them; and (3) Mr Sobey was subsequently persuaded by Mr Mercorella to appoint Mr Basso as his accountant.  Further, Mr Sobey deposed to the fact that his home and the homes and businesses of other investors were “raided” by the ACC on 24 August 2004, with the result that “all [Mr Sobey’s] private and business documents were seized”.   He added:

Last week, ten boxes of documents were returned to me by the ACC with the exception of some documents of mine which related to my dealings with BCFR.  Apart from the BCFR documents, I do not at this time know if all of my documents have been returned by the ACC.  The 10 boxes of documents are now with my accountant, Mr Lipson for his examination and report. 

9                     On about 4 June 2008, Mr Sobey sought leave to issue subpoenas against the Australian Securities and Investments Commission (“ASIC”) and Messrs Nicol and Davies, both of McGrath Nicol & Partners, to produce certain documents, but leave was refused – as indicated at the second scheduling conference – on the basis that the subpoenas were too wide.  On 11 June 2008, the Tax List Judge granted Mr Sobey leave to issue a subpoena to the ACC.

10                  The second scheduling conference was held on 13 June 2008 before the Tax List Judge.  It is clear enough that, at this stage, the Tax List Judge was highly critical of Mr Sobey’s lack of progress and commented that Mr Sobey had “a large amount of work … to do, and  … has to do it really quickly”.   The issuing of subpoenas was re-visited by Mr Sobey’s counsel, who said:

I take it from what your Honour has said that your Honour regards them as too wide, and I’ll also get some instructions as to what the position might be in – there may be a position where they amend those subpoenas, or narrow them down, bearing in mind what your Honour has said.

The Tax List Judge responded:

I think what really needs to happen internally within your client is that someone needs to stop and take stock about the … issues … And then, having made an assessment of that, then work out, having determined what their case is, whether or not the subpoenas are required.

And given the breadth of them and to whom they’re directed, I’m not going to prejudge them, but someone is going to look at them very carefully before they make a decision about issuing subpoenas of that nature. … [I]t seems to me that it’s been a scattergun approach rather than someone stopping and taking stock about whether or not they’re absolutely essential.

11                  At this scheduling conference, the Tax List Judge ordered: (1) Mr Sobey to file and serve any material on which he intended to rely by 25 July 2008; (2) the Commissioner to file and serve any material on which the Commissioner intended to rely by 15 August 2008; (3) the parties to file and serve an outline of submissions and any objections to evidence by 29 August 2008; and (4) the matters to be set down for trial before me (as the docket judge) on 9, 10 and 11 September 2008.

12                  On 24 July 2008, Mr Sobey gave notice of change of practitioner.  On 25 July 2008, Mr Sobey filed an affidavit sworn by Giuseppe Falanga.

13                  On 6 August 2008, the Commissioner sought leave to issue subpoenas against: (1) Messrs Nicol and Davies, to produce a copy of the transcript of examination of Mr Sobey on 22 December 2005 in this Court and the affidavit of Mr Davies sworn on 9 May 2007 and filed in this Court; and (2) Australian Securities and Investment Commission (“ASIC”), to produce copies of three affidavits filed in this Court on 12 July 2005 in SAD 160/2005. The Tax List Judge granted the requisite leave; and, at the return of the subpoenas on 20 August 2008, both parties were given leave to uplift, inspect and copy the documents that had been produced, subject to orders as to confidentiality in respect of the ASIC documents.  On 28 August 2008, Damaris Amanda Sheldon, an ASIC employee, made an affidavit in support of ASIC’s objection to access being granted to the parties in relation to specified parts of the documents that ASIC produced under subpoena.

14                  On 29 August 2008, the Commissioner filed and served an outline of submissions as required by the orders of the Tax List Judge. These submissions concluded that Mr Sobey “has not discharged the onus upon him under s 14ZZO of the Taxation Administration Act 1953” and “[t]he Application[s] must be dismissed with costs”.

15                  Also on 29 August 2008, the Commissioner served a notice of intention to adduce evidence of previous representations in relation to the affidavit of Mr Davies sworn on 9 May 2007 and specified parts of the affidavit of Russell Gibb, an ASIC investigator, sworn on 12 July 2005, both which were produced under the subpoenas referred to in [13] above.  On the same day, the Commissioner filed a notice specifying the Commissioner’s objections to the affidavit evidence filed by Mr Sobey.

16                  On 2 September 2008, Mr Sobey was granted leave to issue a subpoena to Mr Basso to produce documents and to attend Court to give evidence.  This subpoena was returnable on the first day of trial. Also on 2 September 2008, Mr Sobey notified the Commissioner that he required the attendance for cross-examination of Mr Davies, Mr Gibb and other ASIC investigators.  On that day too, Mr Sobey filed and served his outline of submissions, in which counsel for Mr Sobey stated that Mr Sobey “will also seek to rely on further affidavits from Sobey and Lipson; and oral evidence from subpoenaed witnesses”.  Mr Sobey’s solicitors filed further affidavits from Mr Sobey and Mr Lipson on 3 and 4 September 2008 respectively.

17                  Upon reading Mr Sobey’s statement regarding further affidavits and oral evidence, the Commissioner requested an urgent hearing.  This took place on 5 September 2008, during the course of which the trial dates were vacated.  Some time thereafter, it came to light that  the subpoena served on Mr Basso did not include a last date for service and, as a result, the original subpoena to Mr Basso was set aside and a new subpoena issued to him.

18                  The foregoing provides the factual context that prompted the present applications, which were heard on 18 September 2008.

PARTIES’ SUBMISSIONS

19                  In oral and written submissions, the Commissioner claimed costs upon the basis that:

1.         Mr Sobey failed to comply with the Tax List Judge’s orders of 13 June 2008, even though the Tax List Judge made it clear that, in giving Mr Sobey until 25 July 2008, Mr Sobey was being given “one more chance”. (Emphasis added.)

2.         As at 25 July 2008, Mr Sobey’s case “remained in disarray” and was “incapable of discharging the statutory onus” that lay on him.

3.         As at 25 July 2008, Mr Sobey had not filed statements from a number of the potential witnesses named by him in his earlier witnesses list, and nor had he subpoenaed them.  Further, Mr Sobey had given no explanation about this failure.

4.         Having regard to earlier litigation involving Mr Sobey and the Mercorella scheme, it should be inferred that Mr Sobey made “a considered decision … in these proceedings not to adduce evidence from the liquidator in accordance with affidavit material filed on behalf of the liquidator in proceedings to which he was a party, despite listing the [liquidator] on his preliminary list of witnesses in this proceeding”.

5.         Although Mr Sobey’s witnesses list referred to “ASIC investigators” and his amended appeal statement made certain statements about ASIC’s findings concerning the Mercorella scheme, Mr Sobey did not rely on any ASIC material.

6.         In his outline of submissions filed on 2 September 2008, Mr Sobey “conceded that, at [the present] time, [his] affidavit is based upon incomplete documentation”.  These submissions added that Mr Sobey “[was] unable to say what amounts he invested with Mercorella and what amounts he received”, although “[t]his position is likely to change now that Mercorella’s records may be available”.  Mr Sobey made similar observations with respect to Mr Lipson’s evidence.  As noted, Mr Sobey indicated an intention to call additional evidence.  Subsequently, Mr Sobey filed two further affidavits and provided a copy to the Commissioner of the subpoena to Mr Basso.  

7.         Accordingly, the Commissioner had prepared a case for trial “on the basis of the material filed by [Mr Sobey] in accordance with [the] orders of the court only to have the evidentiary basis of [his] case change completely on the eve of the trial”.  Mr Sobey’s failure to comply with the Court’s orders by filing and serving his complete case by 25 July 2008 caused the trial to be vacated.  The Commissioner noted that Mr Sobey had “many months to obtain the [relevant] documents and file and serve any expert evidence arising there from, or indeed to subpoena directly from the Bank the relevant statements”.  Mr Sobey had not explained why he had delayed so long in seeking to subpoena documents from Mr Basso, noting that Mr Sobey’s counsel had stated, on 5 September 2008, that he would be unable to proceed to adduce evidence in chief from Mr Basso on 9 September 2008 because he needed time to analyse the documents that Mr Basso produced.

20                  In oral and written submissions in opposition to the Commissioner’s applications, counsel for Mr Sobey said that:

1.         He had “never conceded that [he] will lose the case or that [his] evidence was insufficient”.  He submitted that the Commissioner “was not entitled to sit on his hands and do nothing in the circumstances … where there is a genuine dispute on both fact and law”.  Mr Sobey repudiated the Commissioner’s assertion that he “would not discharge his onus”, referring to Mr Lipson’s first two affidavits.

2.         The manner in which the Commissioner made the objection decisions under appeal was contestable and alleged that he had been “denied natural justice” when leave to issue subpoenas to ASIC and Messrs Nicol and Davies was refused. 

3.            “[T]he precipitous action taken by the [Tax List Judge] in rejecting the subpoenas outright severely set back [Mr Sobey’s] preparation for trial”. 

4.                  “[S]ome of the contents of the requests in [Mr Sobey’s] subpoenas have now been supplied on the return of subpoenas issued by [the Commissioner] … to … Mr Davies and to ASIC”.

5.            The Commissioner had not complied with pre-trial orders since the Commissioner had sought the issue of the subpoenas to ASIC and Mr Davies returnable on 20 August 2008, which had led to the production of “at least two folders of new documentation being produced and provided to [Mr Sobey’s] Counsel on … 25 August 2008”.  It was, so Mr Sobey said, “disingenuous to suggest that [he] should file [his] contentions on 29 August 2008 when [the Commissioner] had just produced two folders of material which were clearly relevant”. 

6.         The trial had been vacated  “not by [Mr Sobey’s] actions but by the plea made by [the Commissioner] that they have done nothing in preparation for the trial, but now might be prejudiced by any documents … which might be produced by Basso on subpoena”.  Mr Sobey claimed that he was “still prepared for the trial to go ahead” “although faced at the last moment with the documents that [he] has been seeking for months”. 

7.         Further, amongst other additional matters, the Commissioner did not supply the Order 52B documents to Mr Sobey’s new solicitors “despite the fact that the [Commissioner’s] solicitor knew that [Mr Sobey’s] present solicitor did not have access to the previous solicitor’s file”.

CONSIDERATION

21                  The Court has discretionary power to make orders as to costs, which power is to be exercised judicially: see Federal Court of Australia Act 1976 (Cth), s 43 and Ruddock v Vadarlis (No 2) (2001) 115 FCR 229 at 234 per Black CJ and French J.  The Court is now concerned with what are commonly known as “costs thrown away”.  An order for costs thrown away is not infrequently made in circumstances such as the present, where an adjournment application succeeds, and the party seeking costs maintains a readiness to proceed on the day fixed for trial but for the conduct of the other party.  The costs thrown away are such costs as have been reasonably incurred that relate to work done and wasted as a result of the successful adjournment application: see Andromeda Handelsaktieselskab v Holme (1924) 130 LT 329 at 330 and Fashion Warehouse Pty Ltd v Pola [1984] 1 Qd R 251 at 254.  Generally, costs thrown away are costs that have been incurred once and will be incurred again for the purpose of the trial that is fixed a second time:  Roger Quick and David Garnsworthy, Quick on Costs (Thomson Law Book Company, 2009) par [1.1230].  It is to be borne in mind that the likelihood or otherwise of a party being ultimately successful in the proceeding is not a relevant consideration on the question whether an order for costs thrown away should be made.

22                  I accept that, as the Commissioner submitted, that the trial dates were vacated essentially because Mr Sobey had failed to have his case ready in time.  The Court’s orders of 13 June 2008 required Mr Sobey to file and serve any material on which he intended to rely by 25 July 2008.  Mr Sobey did not file and serve his completed case by the due date.  Mr Sobey sought to cast responsibility for his dilatoriness on the Commissioner. I reject this submission. The Commissioner was not required to meet a case that Mr Sobey did not make; and, if the Commissioner considered the case that Mr Sobey advanced could not discharge the onus that lay on him, then the Commissioner was entitled conduct himself accordingly.  The procedures at the level of the making of the objection decisions are not relevant in these proceedings.

23                  I reject Mr Sobey’s characterisation of the conduct of the Tax List Judge in refusing to grant leave to issue subpoenas to ASIC and Messrs Nicol and Davies as “precipitous” and as delaying his preparation.  It is evident that the Tax List Judge discussed these subpoenas with Mr Sobey’s counsel at the second scheduling conference and indicated that Mr Sobey’s solicitors should resubmit redrawn subpoenas, which would be reconsidered for a grant of leave.  Months passed and Mr Sobey’s solicitors did not resubmit redrawn subpoenas.  Mr Sobey has given no adequate explanation for this failure.  It is true that the Commissioner sought and obtained leave to issue subpoenas to the ASIC and Messrs Nicol and Davies in early August 2008, but this fact does not shift Mr Sobey’s responsibility for obtaining documents relevant to his case to the Commissioner. 

24                  Furthermore, I accept that, as the Commissioner submitted, Mr Sobey gave no adequate explanation as to why he had delayed as long as he did in seeking to subpoena documents from Mr Basso, bearing in mind that Mr Basso had been named in Mr Sobey’s original witnesses list filed on 30 April 2008.  It is important to note that counsel for Mr Sobey stated on 5 September 2008 that he was unable to proceed with Mr Basso on 9 September 2008 because he had not had an adequate opportunity to analyse the documents that Mr Basso produced.

25                  Finally, it was not the Commissioner’s responsibility to supply Mr Sobey with a new set of O 52B documents when Mr Sobey changed solicitors.  These documents were accessible as part of the Court file.  Presumably too, copies had been provided to counsel for Mr Sobey (who had been involved in the proceeding virtually from its inception) before Mr Sobey changed solicitors on 24 July 2008.  Mr Sobey failed to establish any relevant hardship on this account.

26                  The adjournment was granted because Mr Sobey’s case was not complete and his counsel was unable to proceed.  Furthermore, if Mr Sobey were to be given the opportunity he sought to file further affidavits, the Commissioner was entitled to an opportunity to meet that case since it would apparently differ in material respects from the case advanced by Mr Sobey as at 25 July 2008 and shortly prior to trial. 

27                  In this circumstance, the Commissioner should have his costs thrown away by reason of the adjournment of the trial, including the hearings on 5 and 18 September 2008.  The next question is whether these costs should be paid on an indemnity basis.  The usual rule is that costs are payable on a party and party basis, unless the circumstances of the case warrant a departure from the normal course: see Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225 (“Colgate-Palmolive”) at 233 per Sheppard J; Re Wilcox: Ex parte Venture Industries Pty Ltd (No 2) (1996) 72 FCR 151 at 152-53 per Black CJ and 156-58per Cooper and Merkel JJ; and O 62 of the Rules.  It is unnecessary to outline in detail the principles governing when a departure from the usual rule is justified: see, for example, Boyapati v Rockefeller Management Corporation (No 2) [2008] FCA 1375 (“Boyapati (No 2)”)and the authorities therein.  As the Full Court said in Hamod v New South Wales (2002) 188 ALR 659 at 665 (per Gray J, with whom Carr and Goldberg JJ agreed), indemnity costs “serve the purpose of compensating a party fully for costs incurred, as a normal costs order could not be expected to do, when the Court takes the view that it was unreasonable for the party against whom the order is made to have subjected the innocent party to the expenditure of costs”.

28                  The question is whether the circumstances warrant an award of indemnity costs.  At the second scheduling conference, the Tax List Judge made it abundantly clear that, in accordance with the time-table set, Mr Sobey was required to have his case ready for trial.  This was a proceeding subject to the Tax List Directions dated 4 April 2008, which deal with “arrangements for the management of tax cases” “to promote the just and efficient determination of tax disputes in a timely manner”.  The Tax List Judge warned Mr Sobey’s counsel that “I’ll give you till the end of July, but it’s drop dead [if you fail]”.   Mr Sobey had a sufficient opportunity to prepare his case and has conducted this litigation in wilful disregard of the Court’s pre-trial orders and directions. For the reasons already stated, Mr Sobey’s case was not complete prior to the trial date.  There were affidavits filed late.  The subpoena to Mr Basso was sought late, with no adequate explanation.  Nor was the failure on Mr Sobey’s part to seek leave at an early date to issue redrawn subpoenas to ASIC or Messrs Nicol and Davies adequately explained. Prior to trial, there were documents still said to require the analysis and attention of Mr Sobey’s counsel.  The circumstances of the case warrant an award of costs thrown away on an indemnity basis.

29                  The Commissioner also seeks a departure from the general rule in O 62 r 3(3) of the Rules that an order for costs does not entitle a party to have a bill of costs taxed until the proceeding is concluded.  There are good reasons for the rule, including avoiding multiple taxations and preventing one party from unfairly exhausting the funds of the other, where the outcome of the litigation is unknown.  The Rules contemplate, however, that the Court may in an appropriate case grant leave to tax costs forthwith.  

30                  In Barrett Property Group Limited v Metricon Homes Pty Ltd (No 2) [2007] FCA 1823 (“Barrett”), Gilmour J discussed the circumstances in which departure from the general rule in Order 62 rule 3(3) may be justified: see Barrett at [23]-[24] and the authorities there discussed and cited.  It is unnecessary to repeat his Honour’s discussion here.  Having regard to the relevant authorities, including Barrett, I would not grant leave to tax costs forthwith in this case, at least not now.  I accept that Mr Sobey has led the Commissioner to incur costs over and above what he would have incurred had Mr Sobey conducted his case diligently.  The issues in this case are not complex, however, and I would not expect the trial to be especially lengthy or complex.  The parties ought to be ready for a trial, at the latest, by early next year.  This ought not to be a case in which the Commissioner waits unduly long to recover any costs due on taxation.  

31                  In the circumstances as presently disclosed, I would not order costs to be paid forthwith. 

32                  Accordingly, I would order that Mr Sobey pay the Commissioner’s costs thrown away by reason of the trial of the proceedings being adjourned, including the hearings on 5 and 18 September 2008.  I would further order that these costs be paid on an indemnity basis.

Associate:

Dated:         17 November 2008