The
plaintiff insisted that it should be paid costs on a higher scale.
The
plaintiff argued that there is no basis for making it pay legal costs
incurred unnecessarily. The defendants used unwarranted dilatory
tactics to delay finalisation of this matter thus prejudicing the
plaintiff of its monies which were legally due, and, thereby
prolonging the
matter, causing ...
The
plaintiff insisted that it should be paid costs on a higher scale.
The
plaintiff argued that there is no basis for making it pay legal costs
incurred unnecessarily. The defendants used unwarranted dilatory
tactics to delay finalisation of this matter thus prejudicing the
plaintiff of its monies which were legally due, and, thereby
prolonging the
matter, causing the plaintiff to further incur unnecessary legal
costs.
On
the date of hearing, the defendants applied for a postponement to
allow some application for consolidation to be determined by this
court. The applicant argued that the application for consolidation
was designed to delay the finalisation of the matter further. Such
tactics showed that the defendants were not serious about settling
the matter.
Looking
at the defendant's plea, it is clear that the plea did not disclose
a defence. The issue of payment of costs on a higher scale was never
put in issue.
The
plaintiff also argued that in terms of clause 10 of the various
agreements signed with the defendants, the plaintiff is entitled to
costs on a higher scale.
Counsel
for the defendants strongly opposed the granting of costs on a higher
scale. He denied that the defendants played for time. He attributed
the delay to reaching a settlement on the plaintiff's counsel whom
he accused of not having been co-operative during the proceedings and
negotiations. He alleged it was the plaintiff's counsel who refused
to meet with the defendants to finalise issues.
As
a general rule, the losing party pays the costs of the winning party.
Usually such level of costs are on a party to party scale. However,
there are situations where the courts are called upon to order
punitive costs against litigants for various reasons, for example,
where parties like in this instance agree that such costs would be
payable. See Mcpherson
v Teuwan & Anor
(2012) ZAGP JHC 18.
I
have perused the various agreements signed between the parties and
observed that indeed under clause 10, it is provided that in case of
default:-
“Kingdom
shall take other legal actions as it may in its absolute discretion
decide, the costs of which the company
shall be liable on a legal practitioner and own client scale,
including, for the avoidance of doubt, any collection commission that
may be charged and any other costs of recovery of the due and payable
amount.”
The
above paragraph gives the plaintiff the discretion of deciding when
to take legal action and it gives the plaintiff the right to recover
costs on a legal practitioner and own client scale.
A
plethora of cases have held that the court has a discretion to, even
in the face of an agreement, refuse to sanction such an agreement.
See Neyhoff
v York Timber Ltd
1981 (4) SA 666 T …,.
In
arriving at my decision, I have considered the purpose of punitive
costs, which, amongst others, are deterring frivolous litigation,
encouraging parties to settle wherever possible, and discouraging
institution and continuation of hopeless cases and defences.
The
defendants have failed to provide any basis for me to disregard the
agreement between the parties. That agreement provided that in the
event of the plaintiff approaching the court, in the case of default
by the defendants, the plaintiff would be entitled to costs on a
higher scale.
From
the onset, this was a matter which should have been settled earlier.
However, the defendants decided to buy time by advancing hopeless
defences. The matter failed to proceed to trial when the matter was
initially set down on 3 June 2014 due to one excuse or the other by
the defendants. Such postponements, of course, caused prejudice on
the plaintiff and inconvenience to the court. The court has no option
but to show its displeasure by awarding costs on a higher scale.
The
defendant has failed to show that the plaintiff's counsel caused
the delays in finalising the matter.
In
the result, it is ordered as follows:-
The
first, third, fourth, fifth and sixth defendants, jointly and
severally, the one paying the other to be absolved, be and are hereby
ordered to pay the plaintiff's costs on a client-attorney scale.
