Background
Antonio Jose Alvarez sued Richard Sarcilla and NT Proform Construction Pty Ltd. After NT Proform entered voluntary liquidation, Alvarez required leave under s 471B of the Corporations Act 2001 (Cth) to continue against it. Alvarez pursued a summary-judgment application, initially against Sarcilla and later against both defendants.
The defendants filed amended defences: Sarcilla’s was served on 13 March 2026 and NT Proform’s on 18 May 2026. Those pleadings materially changed the issues. Alvarez did not provide the evidence contemplated for the summary-judgment hearing and, on 8 July 2026, said the matters raised by the amended defences were more suitable for trial. The parties consented to dismissal of the application, leaving costs for determination on the papers.
The Court’s Holding
McCafferty J held that the amended defences were a supervening event that materially changed the footing on which the summary-judgment application would have been decided. The dismissal was therefore not properly characterised as an outright surrender or capitulation by Alvarez, and neither side’s primary position—that it recover all of its costs—should be accepted.
However, Alvarez did not promptly abandon the application after the amended defences were served. From those dates, he was or ought reasonably to have been aware that summary judgment was unlikely to succeed. The Court ordered him to pay Sarcilla’s standard-basis costs from 14 March 2026 and NT Proform’s standard-basis costs from 19 May 2026; costs incurred before those dates were reserved. The Court refused Sarcilla’s request to fix costs, finding insufficient evidence to set a fair amount and no adequate basis to conclude an assessment would be protracted or expensive.
Key Takeaways
- Amended pleadings that materially alter the issues can make a summary-judgment application inappropriate without making its dismissal a capitulation.
- An applicant must reassess and promptly discontinue a summary-judgment application once amended defences reveal triable issues.
- A fixed-costs order requires sufficient evidence that the proposed amount is reasonable and can be fixed fairly.
Why It Matters
The decision illustrates the usual reluctance to determine the merits of an abandoned interlocutory application solely to allocate costs. But it also confirms that a party who delays abandoning an application after being put on notice of material factual and legal disputes may bear the opposing parties’ later costs.