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[2013] NSWSC 295
Supreme Court of NSW
2013-03-08
Button J
Original judgment source is linked above.
Background and submissions 63As a result of my determination with regard to costs, the question is whether I should approve the settlement of the matter in favour of the plaintiff in the sum of $495,000 plus costs. 64Whatever the outcome of the costs argument, the defendant did not seek to be heard with regard to the approval, except to submit that it is appropriate. 65I received some evidence from the plaintiff to which it is appropriate to refer briefly. The tutor deposed in an affidavit that her main concern is the welfare of her son, and that she regards a settlement in the sum of $495,000 plus costs as in his best interests. 66Three confidential exhibits were tendered. They were not made available to senior counsel for the defendant, and I disregarded their contents in considering the costs question. I shall not refer to them except to say that senior counsel for the plaintiff, who has been involved in the matter for some time, regards the settlement as a reasonable one and submits that the Court should approve it.
Determination of Approval 67The test is simply whether I am satisfied that the settlement is beneficial to the interests of the plaintiff under an incapacity. The principles that underlie s 76 of the Act were discussed in the judgment of Hammerschlag J in Permanent Trustee v Mills [2007] NSWSC 336; (2007) 71 NSWLR 1 at [19]: "The substantive principles which underpin those provisions are the following: a. this Court has parens patriae jurisdiction which in general terms is exercised when there is some risk to a child's welfare and which supports a great variety of orders, including orders related to protection of property: AMS v AIF (1999) 199 CLR 160 at 189 per Gaudron J; b. when a claim of an infant or other person under disability is before the Court, the Court needs, for the purpose of protecting his or her interests, full control over any settlement compromising his or her claim: Dietz v Lennig Chemicals Ltd [1969] 1 AC 170 at 189 per Lord Pearson; c. in an action by an infant by means of a best friend or tutor whatever is done must be for the benefit of the infant, and if, in the opinion of the Court it is not so, the infant is not bound: Rhodes v Swithenbank (1889) 22 QBD 577 at 578-579. Concomitantly, the Court will not enforce a compromise against the opinion of the tutor and his or her advisers: Re Birchall (1880) 16 Ch D 41." 68That discussion was quoted with approval in the judgment of Rothman J in Fisher by her tutor Fisher v Marin [2008] NSWSC 1357 where his Honour added at [41]: "Ultimately, the principle that I apply is whether the settlement that has currently been reached (and the amount thereof) is in the interests of the plaintiff. In that regard, bearing in mind the risk that, liability being in issue, the plaintiff would receive nothing from any hearing that may occur, the test may be described as whether the risk to the plaintiff, of losing that which is already agreed, is outweighed by the possibility of receiving more if the matter were to go to hearing." 69Although the wishes of the tutor and the position of senior counsel for the plaintiff are not determinative, I consider that they should be given substantial weight. There is nothing to suggest that the tutor is motivated by anything other than love and concern for the best interests of the plaintiff. The standing of the advocate for the plaintiff is surely a relevant factor in my assessment of his opinion about the matter. 70In all the circumstances, I am satisfied that, in light of my determination regarding the appropriate order as to costs, the terms of the settlement are beneficial to the interests of the plaintiff. I certainly see no basis upon which I should stand in the way of the wishes of the tutor, informed as she is by the professional opinion of a solicitor and a member of the inner Bar. Accordingly, I propose to make orders approving of the settlement of the matter in the sum of $495,000 plus costs.
The Court orders that: (1A) The defendant's application of 1 February 2013 be dismissed with costs. (1)Pursuant to section 76 of the Civil Procedure Act 2005, the settlement of the plaintiff's claim is approved. (2)Judgment for the plaintiff against the defendant in the sum of $495,000 plus costs as agreed or assessed ("the Judgment").
The Court notes that: (3)The defendant will be at liberty to deduct and pay out of the Judgment any moneys repayable by the plaintiff to any person or body, whether in respect of social services, health services or otherwise, concerning which any demand or notice has been served on or given to the defendant or its solicitors or the insurers. (4)No interest will be payable in respect of the Judgment if the Judgment is paid within 28 days after whichever of the following events occurs last: (i)Entry of Judgment by the Court, or (ii)Receipt by the defendant of a final notice of reimbursement in accordance with the Health and Other Services (Compensation)Act 1995 as amended and a duly completed Medicare Australia Notice and Details of Settlement form signed by the plaintiff's solicitor, or (iii)Where the defendant or its insurer has been or is notified that there may be moneys owing to Centrelink (Department of Social Security), receipt by the defendant of a final notice from Centrelink informing it of the amount of the payback or of the fact that no moneys are repayable. (5) (a)No interest shall be payable in respect of costs if the costs are paid within 28 days after whichever of the following events occurs last: (i)The costs being agreed, or (ii)Receipt by the defendant of a written notice of the assessment of costs, or (iii)Receipt by the defendant of a written document signed by the plaintiff authorising and directing payments of the costs, and (b)If interest becomes payable in accordance with 5(a), the interest will only be calculated from the date which is 28 days after the last event.
The Court directs that: (6)The Judgment sum, after deduction of any amounts payable to Centrelink or Medicare Australia, is to be paid into Court pending further orders as to the investment and management of that sum. (7)Costs are to be paid directly to the plaintiff's solicitors in accordance with an Authority to Receive satisfactory to the defendant. (8)The confidential material placed before the Court on behalf of the plaintiff will be retained in the court file in an envelope marked "Only to be opened by order of a Judge".
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 04 April 2013
Bogle
Kasan
Submissions of the defendant 33Because the defendant is, in effect, the moving party in seeking to persuade me not to make the usual costs order, I called upon senior counsel for the defendant first at the hearing. It is also convenient to recount his submissions first in this judgement. 34He submitted that three fundamental propositions apply to the determination of the question. 35The first was that he bore the onus of persuading the court to move away from the usual position of costs following the event. 36The second was that the defendant must demonstrate that there was a genuine offer of compromise. In light of the fact that senior counsel for the plaintiff accepted that that proposition was not in dispute, the submissions on behalf of the defendant were truncated, and I propose to approach that factor in this judgment on the basis that it has been made out. 37The third was that the defendant must demonstrate that it was unreasonable for the plaintiff not to accept the offer at the time it was made. 38Senior counsel for the defendant submitted, in short, that it was indeed unreasonable for the plaintiff not to have accepted the offer at the time it was made. He pointed to the fact that the statement of claim was filed during that time, thereby demonstrating that the plaintiff was sufficiently apprised of the facts to commence proceedings. During that time, breach of duty was admitted by the defendant. Without seeking to apply the wisdom of hindsight, he submitted that the offer made by the defendant was a remarkably accurate prediction of the ultimate resolution of the dispute by way of settlement. And yet, due to the refusal of the plaintiff to accept the offer, his client had been put to 12 months' worth of unnecessary expense. 39He submitted that the fact that the letter referred to the matter proceeding to a hearing, and as things turned out that had not occurred, was of no moment. He sought to construe the rules to demonstrate that that distinction could not, at least in this case, be drawn. In any event, he submitted that any discretionary order under s 98 of the Act could hardly turn on so refined a distinction. The fact was, he submitted, that the defendant was making perfectly clear by the letter that if the offer were not accepted, and thereafter the matter was resolved by way of success for the plaintiff in a lesser sum, the defendant would seek his costs from the date of the letter. 40He accepted that litigation, both in its conduct and its preparation, is an organic process. He also accepted that it is not uncommon for parties and their lawyers to be disappointed by experts who modify or even resile from the opinion that they originally expressed when confronted with the evidence of the experts of the opponent. But in this case he submitted that an analysis of the chronology did not demonstrate that that had occurred. He noted that there was no evidence from the tutor or the solicitor for the plaintiff detailing their responses to the expert evidence of both parties as it was received throughout 2011 and 2012. He also noted that the early report of Ms Mullen contained a suggestion that the plaintiff could "become more independent at home", thereby raising the possibility that not all of the disabilities were based on a physical injury. 41In the alternative, he submitted that, even if one accepts that the materials from the experts subsequently altered the perception of the tutor and the legal team of the plaintiff as to the strength of the case for the plaintiff, nevertheless it was unreasonable of the plaintiff to reject the offer at the time it was made. 42He referred to the judgment of Beazley JA (with whom McColl JA agreed, Bryson JA dissenting) in Vale v Eggins (No 2) [2007] NSWCA 12 in order to distinguish it on the simple basis that here there was no reticence on the part of the defendant with regard to his expert reports. 43In short he submitted that 12 months' costs had been needlessly thrown away by his client as a result of the behaviour of the plaintiff, and there should be some adjustment to the usual order.
(2007) 71 NSWLR 1
(1999) 199 CLR 160