Carvajal v Lamba

Rule 42.35

Rule 42.35 of the Uniform Civil Procedure Rules 2005 provides as follows: "(1) This rule applies if: (a) in proceedings in the District Court, a plaintiff has obtained a judgment against the defendant or, if more than one defendant, against all the defendants, in an amount less that $40,000, and (b) the plaintiff would, apart from this rule, be entitled to an order for costs against the defendant or defendants. (2) An order for costs may be made, but will not ordinarily be made, unless the District Court is satisfied the commencement and continuation of the proceedings in the District Court, rather than the Local Court, was warranted."
It has been held that the commencement and continuation of proceedings in the District Court was warranted in a case which involved factual circumstances of some complexity - Singapore Airlines Cargo Pte Ltd v Principle International Pty Ltd (No. 2) [2017] NSWCA 340.
The District Court hears most of the personal injury actions conducted in New South Wales. The Local Court deals with the bulk of criminal work in this State. I did ask Mr Renshaw whether, in his fifth decade in practice at the Bar, he was aware of any motor accident cases being run in the Local Court. I did not receive an affirmative answer. Ms Balendra, who appeared for the plaintiff, pointed out that in the Local Court leave is required to rely upon any expert evidence. Of course, personal injury actions run in the District Court do not require the grant of leave for expert evidence. In every personal injury action there are reports from treating doctors and medico-legal expert reports. The procedure in the District Court is well-suited to the conduct of personal injury actions, and the procedure in the Local Court is not as well-suited.
There is no presumption that r 42.35 will not apply in personal injury claims, where the resulting verdict is less than $40,000. The question in each case is whether the complexity of the case warranted the bringing of the proceedings in the District Court - Colak v Ghalloub (No. 2) [2017] NSWDC 351 at [13-15].
The action brought by the plaintiff involved a determination of complex issues. The defendant had obtained a certificate exempting the claim from the CARS assessment process on the grounds that liability was in dispute. Much of the evidence in the case was taken up on the question of liability. The plaintiff gave evidence about the circumstances of the accident and was extensively cross-examined. The same can be said of the defendant. I believed the plaintiff and I did not accept the evidence of the defendant on liability. I went so far as to say that some of the evidence given by the defendant had been made up in the witness box.
The case on damages was also not a simple one. There was a large folder of medical material tendered by the plaintiff, which had to be read and analysed. Until midway through the second day of the trial, Dr Harrison, an orthopaedic surgeon, was required to attend for cross-examination. There was cross-examination of the plaintiff, conducted very effectively, on the question of past and future economic loss. The defendant achieved a favourable result in relation to those heads of damage, but it could not be said that the determination of those issues was straightforward. I reject the submission of Mr Renshaw that the result on damages was inevitable.
Having regard to the need to determine factual issues of some complexity, and having regard to the District Court being the most suitable forum for motor vehicle personal injury cases, I find that the commencement and continuation of the proceedings in the District Court, rather than the Local Court, was warranted. Subject to the further issues dealt with below, I find that my initial costs order was warranted.

[4]

Proportionality

As previously recited, the defendant sought a costs order "made in accordance with s 60 of the Civil Procedure Act". Section 60 provides: "In any proceedings, the practice and procedure of the court should be implemented with the object of resolving the issue between the parties in such a way that the cost to the parties is proportionate to the importance and complexity of the subject-matter in dispute."
I do not think that s 60 has any direct application to the present issue. Section 60 is concerned with case management, and not with the award of costs after the trial has concluded. Section 60 is something to be kept in mind when the court is making directions under s 61 or s 62 of the Civil Procedure Act.
The defendant made it plain by MFI 12 and by the submissions of counsel, that it also relied upon s 98 of the Civil Procedure Act, without identifying which sub-section was relied upon. I presume that because proportionality was raised, the defendant would rely upon s 98(4) which is in the following terms: "In particular, at any time before costs are referred for assessment, the court may make an order to the effect that the party to whom costs are to be paid is to be entitled to: (a) costs up to, or from, a specified stage of the proceedings, or (b) a specified proportion of the assessed costs, or (c) a specified gross sum instead of assessed costs, or (d) such proportion of the assessed costs as does not exceed a specified amount."
Mr Renshaw described the modest result achieved by the plaintiff on damages as "exiguous" and submitted that the notion that full costs should be ordered against the defendant was "monstrum in fronte, monstrum in animo".
There was no evidence in the case as to the likely quantum of the full assessed costs of the plaintiff. That makes it difficult to even consider making an order that the plaintiff only recover a proportion of assessed costs, or a specified gross sum instead of assessed costs. It has been said that a lump sum costs order should only be made where the court has sufficient confidence to arrive at an appropriate sum on the materials available - Colquhoun v District Court (NSW) (No. 2) [2015] NSWCA 54 at [6]. Most applications for gross sum costs order are supported by expert evidence - Tim Barr Pty Limited v Narui Gold Coast Pty Limited [2011] NSWSC 11 at [26].
In relation to capping orders, courts have been reluctant to impose arbitrary limits on the amount of costs recovered to meet concerns of proportionality of costs after proceedings are concluded, unless court costs scales exist to warrant the lower recovery, or other misconduct has occurred warranting costs reduction - Lovick & Son Developments Pty Limited v Doppstadt Australia Pty Limited (No. 3) [2013] NSWSC 135 at [48].
As previously recited, the plaintiff had no choice but to litigate this claim, as the defendant put liability in issue from the very start, and indeed obtained exemption from the CARS assessment process. As discussed with counsel during submissions, I will decide the matter on the basis that there was no offer made by the defendant to settle the case, so that the plaintiff was never put at risk in relation to costs by an Offer Of Compromise, or a Calderbank offer.
There was simply no material put before the court upon which to base a lump sum order, or a capping order, or a proportion order. The defendant did not set out the precise order which it sought, either by way of nominating a dollar amount for costs, or making a submission as to a suitable percentage of total costs. I have already recited my view concerning the complexity of the issues in the case, particularly the issue of liability. Having regard to the number of issues litigated, the case was run speedily and economically by experienced counsel on both sides. It could not be said that there was any conduct on the part of the plaintiff which would warrant a costs reduction. For those reasons, I decline to make any order which would reduce the costs otherwise payable by the defendant to the plaintiff in accordance with my original order.
Costs of different issues
Mr Renshaw submitted that because the plaintiff failed to obtain any damages for past or future economic loss, and because the plaintiff could not as a matter of law obtain damages for non-economic loss or gratuitous attendant care services, the court should order the plaintiff to pay the costs of those issues. Such an order can be made under the wide discretionary power as to costs contained in s 98 of the Civil Procedure Act 2005.
While the plaintiff particularised claims for non-economic loss and gratuitous attendant care services, these were not pressed. Liability was the key issue in the trial. It took up the most court time. The credibility of the plaintiff was an important matter, not only in relation to liability but also in relation to the assessment of the various heads of damages. That makes it hard to disentangle distinct issues for the purpose of differential costs orders. It is not without irony that the plaintiff failed to obtained damages for past and future economic loss because of my acceptance of her truthful evidence on these issues. Further, I accepted the plaintiff's medico-legal evidence from Dr Harrison on these topics, but rejected the opinion of Dr Pierides, the defendant's expert. For those reasons I do not propose to dissect issues or make any costs orders against the plaintiff because she failed to obtain some heads of damage.

Carvajal v Lamba - [2019] NSWDC 333 - NSWDC 2019 case summary — Zoe

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Judgment (6 paragraphs)

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