Haywood v Collaroy Services Beach Club Ltd

LEGISLATION CITED : Uniform Civil Procedure Rules Legal Profession Act

Anthony Haywood v Collaroy Services Beach Club Limited [2006] NSWSC 566 Hartley Poynton Ltd v Ali [2005] VSCA 53 CASES CITED : Minerals Corporation Ltd v Abbot [2004] NSWSC 246 Haywood v Collaroy Services Beach Club [2003] McLean v Commonwealth of Australia (Sperling J, unreported, 22 August 1996 NSWSC 43 NSW Insurance Ministerial Corporation v Edkins (1998) 45 NSWLR 8

PARTIES : Anthony Neville Haywood (plaintiff) Collaroy Services Beach Club Limited (defendant)

COUNSEL : T D Kelly (sol) (plaintiff) J Maconachie QC; J Sheller (defendant)

SOLICITORS : T D Kelly & Co (plaintiff) Hunt & Hunt (defendant)

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

020252/01 Anthony Neville Haywood v Collaroy Services Beach Club Limited

JUDGMENT - On further matters raised after verdict 1 HIS HONOUR: On 24 February 2006 the jury awarded the plaintiff damages of $2,500,000. On 16 June 2006 I awarded an additional amount of $636,000 for funds management, together with $1,463.00 for the costs of proceedings in the Equity Division to appoint the Protective Commissioner to manage the plaintiff's estate. Accordingly, on the same day I entered judgment for the plaintiff for the sum of those amounts, $3,137,463. I have since heard argument about four further matters, with which I shall deal in turn.

When judgment should take effect 2 The plaintiff's solicitor, Mr Kelly, submitted that I should order that the judgment take effect on the day of the verdict, 24 February 2006. The power to make such an order is to be found in r36.4(3) of the Uniform Civil Procedure Rules. The application was made for the purpose of preserving the plaintiff's entitlement to interest after judgment. Mr Kelly calculated that, if interest at the prevailing rate of nine percent had been allowed on the jury's award of $2,500,000 from the day of the verdict, it would have amounted to $68,992 by 16 June. If interest had been allowed on the total amount of the judgment over the same period, the figure would have been $86,576. 3 Mr Kelly relied upon the chronology of events after the verdict. On 1 March 2006 he filed on behalf of the plaintiff the summons in the Equity Division seeking the appointment of the Protective Commissioner and a notice of motion in this Division seeking, among other things, the award for funds management. In the event, those applications and several other applications arising after the verdict were not heard until May. Although Mr Kelly did not raise it, this was partly due to the fact that I required hospital treatment and was unable to sit for several weeks. 4 The defendant accepted that the plaintiff was entitled to an award for funds management, but contested the amount of it. This involved evidence and argument. To that extent the defendant was successful, as I awarded the lesser amount which it had conceded: see [2006] NSWSC 566 at [4]-[9]. 5 Mr Sheller, for the defendant, accepted that I had the power to ante-date the judgment but argued that that course is exceptional. Both he and Mr Kelly referred to the extensive review of the power by Ormiston JA in Hartley Poynton Ltd v Ali [2005] VSCA 53 and, in particular, his Honour's conclusions at pars [73] - [80]. Mr Sheller was concerned that to ante-date the judgment might mean that the defendant's appeal was out of time, although Mr Kelly undertook to consent to any necessary extension of time. If the plaintiff were entitled to greater interest than that running from the date of entry of the judgment, Mr Sheller said, the preferable course would be to assess the additional amount and add it to the amount of the judgment. 6 His primary submission, however, was that I should take neither course because the plaintiff was not entitled to any additional interest. He pointed out that on 7 March 2006 senior counsel for the plaintiff disavowed any application for pre-judgment interest by "some form of apportionment" of the jury's award. I have reflected on the matter, and have decided that Mr Sheller's submission is sound. It is regrettable that the entry of judgment was delayed to some extent by my indisposition. Nevertheless, it was primarily the result of the plaintiff's motion for an award for funds management. As I have said, that was a matter which had to be litigated and, to the extent that it was, the defendant was successful. 7 This application is refused.

Costs assessment 8 Mr Kelly sought leave to proceed forthwith to have the plaintiff's costs assessed. He noted that, by r36.4(2) of the Uniform Civil Procedure Rules, where costs are ordered by a court and are to be assessed, the order takes effect on the date when the cost assessor's certificate is filed. By s368(5) of the Legal Profession Act, the filing of that certificate in a court of relevant jurisdiction is taken to be a judgment for the amount of costs unpaid. The application was made for more abundant caution, Mr Kelly querying whether leave was required because costs assessment is not a proceeding in this Court: see the judgment of Bell J in Minerals Corporation Ltd v Abbot [2004] NSWSC 246 at [6] - [12]. However, that matter was not argued and I proceed upon the assumption that leave is necessary. 9 The purpose of this application also was to preserve the plaintiff's entitlement to interest. Mr Kelly pointed out that the judgment should be treated as final unless and until it was reversed or varied on appeal. He argued that the plaintiff was entitled to have costs assessed as quickly as possible, so that a certificate of assessment could be filed promptly and interest could run from that date. He accepted that, despite the effect of filing the certificate under s368(5) of the Legal Profession Act, the stay of proceedings I ordered on 16 June would prevent enforcement of the costs order pending the disposition of the appeal. 10 Mr Sheller opposed this application also. He tendered a letter from Pattison Hardman, costs assessors, stating that the cost of drawing a bill "of this size" could be in the vicinity of $25,000 to $40,000 plus GST (Exhibit 7). I accept that, if the defendant is unsuccessful in the appeal and costs are assessed thereafter, the plaintiff will probably lose the benefit of several months interest. On the other hand, if the appeal were to succeed, it would clearly be undesirable for there to have been incurred the considerable expense of the assessment of costs to which the plaintiff is not entitled. Significantly, since this application was argued the hearing of the appeal has been expedited and has been fixed for 7 November next. Hopefully, judgment will be able to be delivered reasonably soon thereafter. 11 In these circumstances, if my leave were required to proceed to assessment, I would not grant it. It remains for the plaintiff to determine whether that leave is necessary and, if not, what course he should take.

Prior Costs Orders 12 In the course of preparing this matter for trial, there were a number of interlocutory applications which led to costs orders unfavourable to the plaintiff. Mr Kelly sought orders that, in the light of subsequent developments, those orders should be rescinded and in each case the defendant should be ordered to pay the plaintiff's costs. There are seven such orders. As to five of them, the basis on which they are sought to be rescinded is the same and I shall deal with them first. A different basis is raised in relation to the other two and I shall turn to them later. 13 On 22 July 2002 Registrar Howe dealt with a motion by the plaintiff for discovery of material set out in a schedule containing eight paragraphs. The registrar rejected the discovery of all the material except that in the eighth paragraph, which related to records of the accident in which the plaintiff was injured. He ordered each party to pay his or its own costs of the motion. On the 24 October 2002 Master Malpass (as he then was) dismissed a motion by the plaintiff for review of the registrar's decision, and ordered the plaintiff to pay the costs of that motion. On 14 February 2003 Simpson J dismissed an appeal by the plaintiff against the Master's decision, and ordered the plaintiff to pay the costs of the appeal. 14 In September 2003 a subpoena was issued on behalf of the plaintiff to Mr Timothy Parker, the secretary of the defendant Club, seeking production of documents set out in a schedule containing eight paragraphs. In November 2003 the defendant filed a motion seeking that the last three paragraphs of that schedule be struck out. In the same month the plaintiff filed a motion seeking full compliance with the subpoena and also answers from the defendant to certain interrogatories. On 2 February 2004 Registrar Howe granted the defendant's motion and dismissed the plaintiff's motion, and ordered the plaintiff to pay the costs of both motions. On 30 April 2004 Master Malpass dismissed the plaintiff's motion to review that decision of the Registrar and, yet again, the plaintiff was ordered to pay the defendant's costs. 15 As I have said, there was a common basis for Mr Kelly's application for the recission of these costs orders. Paragraphs 6 & 7 of the schedule to the motion for discovery before Registrar Howe sought documents relating to any accident "sustained by persons using a stairway in the defendant's premises" between 1 July 1995 and 9 February 2001, the date of the plaintiff's fall, and for the period from 9 February 2001 to date. Paragraphs 6 & 7 of the subpoena to which I have referred were to the same effect, except that they specified the stairway from which the plaintiff had fallen. Paragraphs 7 & 8 of the interrogatories sought information concerning any accident sustained by any person on that stairway over the same period. 16 Registrar Howe dismissed the motion for discovery as to the first five paragraphs in the schedule on the basis that the plaintiff had not shown "special reasons" within the meaning of the then applicable rule, Part 23 r5 of the Supreme Court Rules. As to pars 6 & 7, concerning other accidents on "a stairway" at the Club, he found that they were too wide as they were not confined to the subject stairway. In the review, Master Malpass found no error in the Registrar's approach. In the course of those proceedings, the plaintiff produced an alternative schedule limiting the discovery sought in pars 6 & 7 to the subject stairway. However, as the motion before him was only for review of the Registrar's decision, the Master declined to entertain that "alternative application". 17 In the unsuccessful appeal against the decision of Master Malpass, Simpson J referred to the alternative schedule and, in a passage upon which Mr Kelly relies for the purpose of the present application, said: … no evidence was adduced to establish the slightest reason for concluding that any such accident had occurred. If there were such evidence, I would be inclined to the view, that, it being reasonable to presume that such information would be in the possession of the defendant and not ordinarily available to the plaintiff, and, with respect to any such accident as pre-dated the plaintiff's accident, that constituted a special reason for ordering discovery limited to material of that kind. As I presently perceive the matter, it is likely that such evidence would be relevant to establishing the defendant's knowledge of any danger presented by the configuration of the stairway, and, axiomatically, only materials relating to accidents which pre-dated, not those that post-dated, the plaintiff's accident would be material. ( Haywood v Collaroy Services Beach Club [2003] NSWSC 43 at [19]) 18 As to the subpoena and the interrogatories, Registrar Howe rejected the motion for leave to administer the interrogatories on the basis that he was not persuaded that such an order was "necessary", within the meaning of Pt 24 r5 of the Supreme Court Rules. In relation to pars 7 & 8 of the interrogatories, concerning any other accident on the subject stairs, he held that information about other such accidents would not assist in establishing how the plaintiff came to fall. He struck out pars 6 & 7 of the subpoena, dealing with the same subject matter, for the same reason. Again, in reviewing the Registrar's decision, Master Malpass found no error in his approach. 19 In the meantime, in response to the limited discovery directed by the Registrar, the defendant had produced a copy of an incident report, dated 9 February 2001, concerning the plaintiff's fall. This was a handwritten document prepared by the secretary, Mr Parker. It was produced at the end of October 2002, after the decision of Master Malpass concerning the motion for discovery but before the hearing of the appeal to Simpson J. 20 Much later, in June 2005, another subpoena to produce documents was issued on behalf of the plaintiff, directed to Mr Parker. In answer to that subpoena there was produced, among other documents, a book described as an "incident register". That book contained the incident report about the plaintiff's fall to which I have referred. Also in it were seven other reports about patrons falling down stairs. While some of those clearly related to the subject stairs, that could not be said of all of them. Six of them were before the plaintiff's fall and one of them was after it. 21 I rejected the tender of these reports at the trial, on the basis that it was unclear how many of them related to the subject stairs and that, in any event, such description as there was of each incident did not admit of any conclusion as to how each of the falls had occurred: transcript pp755 - 759,762. However, at the trial the central issue proved to be causation and the principal focus of the evidence was upon the mechanism of the plaintiff's fall. Mr Kelly argued that the dangerous condition of the stairs and the defendant's knowledge of it, evidenced by the falls of patrons prior to that of the plaintiff, were relevant to the case which had been pleaded, both in the original statement of claim of April 2001 and the amended statement of claim of 2005. I accept that for present purposes. Of course, it was the original statement of claim which was on foot at the time of the relevant interlocutory proceedings. 22 Mr Kelly then argued that, given that these seven accident reports were in the same volume as the report of the plaintiff's fall, they were readily available to the defendant and could easily have been produced in answer to an order for discovery or a subpoena. He asked me to conclude that the defendant knew or ought to have known of their existence and whereabouts at all relevant times. Certainly, he said, this was so at the time of the hearing of the appeal before Simpson J, and yet her Honour observed in her judgment that there was "no evidence" to suggest that any other accident had occurred on the subject stairs. At the hearing of this application, Mr Kelly made it clear that he did not suggest any impropriety on the part of the defendant or its legal representatives. In particular, he did not suggest that Simpson J had been deliberately misled. Nevertheless, he submitted that, in the light of what is now known about the incident register, I should conclude that there had been a miscarriage of justice in all those interlocutory proceedings and the costs orders should be revisited. 23 I accept that I have a discretion to reconsider interlocutory costs orders such as these. Mr Maconachie QC, who appeared for the defendant on this application, did not submit the contrary. Mr Kelly referred to NSW Insurance Ministerial Corporation v Edkins (1998) 45 NSWLR 8, but that decision provides no guidance in the present case. Perhaps not surprisingly, neither he nor Mr Maconachie could refer me to any decided case dealing with an analogous situation. 24 It may have been preferable for the defendant to have produced the incident register much earlier than it did. However, that is not a matter about which I could, or should, express any concluded view. What Mr Kelly has asked me to do, in effect, is to review a series of interlocutory decisions because of a matter that has subsequently come to light. I do not consider that to be an appropriate course. Those rulings, and the associated costs orders, were made on the basis of the material before the Court at the relevant time. Moreover, each of them involved issues other than the history of accidents on the subject stairs and those issues were also determined adversely to the plaintiff. I would not reconsider those costs orders. 25 As I have said, there are two further costs orders which Mr Kelly asked me to reconsider on a different basis. On 17 February 2005 Hislop J ordered the plaintiff to pay the defendant's costs thrown away by vacating the original hearing date of 28 February 2005. Mr Kelly asked that that costs order be vacated. On 13 June 2005 Rothman J granted a motion by the defendant to strike out a number of paragraphs of a subpoena which the plaintiff had issued, directed to Mr Parker, in April 2005. (It was as a result of those proceedings that a differently framed subpoena of June 2005, to which I referred earlier, was issued.) Rothman J ordered the plaintiff to pay the defendant's costs of that motion. Mr Kelly asked that I vacate that order also and order that the costs of that motion be costs in the cause. 26 To an extent, Mr Kelly's argument appeared to be inviting me to review those orders in the light of the history of the proceedings but, again, I do not consider that to be an appropriate course. The primary focus of his submission, however, was that they should be reconsidered because I have ordered the defendant to pay the plaintiff's costs on an indemnity basis from 18 January 2005: see [2006] NSWSC 566 at [26]. Each of the relevant costs orders was made after that date. 27 He relied on the judgment of Sperling J in McLean v Commonwealth of Australia (Sperling J, unreported, 22 August 1996). In that case his Honour had awarded costs on an indemnity basis because of an offer of compromise before the trial. He had earlier granted the plaintiff an extension of the limitation period after a contested application, and had reserved the costs of that application. He ordered the defendant to pay the costs of that application also on an indemnity basis, characterising the application as part of the plaintiff's claim for damages. 28 Clearly, that decision is distinguishable from the present case. This is not a case in which the costs of interlocutory proceedings had been reserved to abide the outcome of the trial. The costs orders in both applications had been made as a matter of fairness, given the circumstances which had led to them. Indeed, the plaintiff had accepted Hislop J's order as inevitable. The fact that I have ordered the defendant to pay the costs to which the plaintiff is entitled after 18 January 2005 on an indemnity basis provides no reason to reverse those orders. 29 Accordingly, this application also is refused.

Disbursements 30 Finally, Mr Kelly asked that, as a further condition of the stay of proceedings, the defendant pay about $100,000 for disbursements. Details of those disbursements are annexed to an affidavit of Grant Watson, a solicitor employed by Mr Kelly. Mr Kelly undertook to refund that amount with interest if, at the appeal, the plaintiff was ordered to pay the defendant's costs of the proceedings. 31 Notwithstanding that undertaking, I am troubled that Mr Watson's affidavit does not contain enough information to determine the reasonableness or appropriateness of a significant amount of those disbursements. Moreover, it is now only about six weeks until the appeal will be heard. It may be that the parties can reach some agreement about provision for disbursements in the meantime, but I am not disposed to make the order which Mr Kelly seeks. 32 The parties should have the opportunity to argue the costs of these applications.

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