The Plaintiff's action in the principal proceedings alleging false imprisonment was heard by me between 6 and 9 July 2020. On 17 July 2020 I entered a verdict and judgment for the Plaintiff in the sum of $7863.00 inclusive of interest. [1] By consent I subsequently directed the parties to file written submissions as to costs pursuant to s 63(3)(c) of the Civil Procedure Act 2005 (the 2005 Act). The Defendant lodged its submissions on 31 July 2020. The Plaintiff's submissions were dated 14 August 2020, although they were not received by me until 17 August 2020.
[2]
Defendant's Submissions
The Defendant accepts that pursuant to rule 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR), costs would ordinarily follow the event. It asserted, however, that this should not be so where it would be unjust to do so. [2] The Defendant submitted that the circumstances of this case made it appropriate that it only be required to pay 30% of the Plaintiff's costs, with such an order being commensurate with the interests of justice and fairness. Four grounds were advanced to this end.
First, the Defendant contended that the majority of the hearing on liability, including the examination and cross-examination of the witnesses, together with the written and oral submissions of the parties, focused on whether the requirements of ss 99(1)(a) and 99(1)(b) of the Law Enforcement (Powers and Responsibilities) Act 2002 (NSW) (LEPRA) were satisfied. The Defendant submitted it was successful in discharging this onus. It contended that save for a small part of DS Macnamara's cross-examination and the submissions on s 99(3) of LEPRA, s 99(3) was not the aspect of the case which subsumed a substantial part of the hearing. It pointed to the fact that Plaintiff's written closing submissions did not expressly address the requirements of s 99(3) at all.
Secondly, it submitted that the Court found the Plaintiff "to be a largely unreliable witness who sought to reconstruct events and exaggerate their occurrence to the point of being implausible." [3] It contended that the Plaintiff's refusal to accept what should have been simple propositions meant that his evidence took much longer and took up more Court time than would have been necessary had he approached the task of giving evidence in a straight forward way. In those circumstances, it was contended that he should not get the benefit of all of his costs as agreed or assessed.
Thirdly, it was contended that relevant to the Court's discretion to award costs is the quantum of damages awarded proportionate to what was sought and the costs of the proceedings. In this case, the Plaintiff claimed in the order of $150,000 in damages, according to the Plaintiff's Schedule of Damages, but was awarded general damages for false imprisonment in the amount of $7000, [4] with there being no award for aggravated damages or exemplary damages. [5] In those circumstances, it was contended that the costs the Plaintiff must have incurred in the four-day hearing in the matter was likely to be significantly disproportionate to his claim and the quantum of damages awarded. It submitted that the Court should not facilitate such disproportion by making an order for costs that simply follows the event.
Fourthly, attention was drawn to an offer of compromise pursuant to rule 20.26 of the UCPR which was served on the Plaintiff on 21 May 2020 and was handed up to the Court upon judgment being delivered on 17 July 2020. [6] That offer sought to compromise the whole of the proceedings in the sum of $5000 and costs capped at $10,000. The offer was expressed to remain open for 28 days. The Defendant described the judgment as being "slightly more favourable" to the Plaintiff than the offer, and accordingly the circumstances of the offer were relevant to the Court's broad costs discretion under s 98 of the 2005 Act. It submitted, given:-
1. the relatively close alignment between the $5000 offer and the $7000 in damages (plus interest) the Plaintiff was awarded (as compared to the $150,000 claimed by the Plaintiff);
2. the fact that the offer was made well before most of the parties' costs would have been incurred in advance of the hearing; and
3. if the offer was accepted, the Plaintiff would have avoided most of these additional costs,
it is appropriate for the Court to take into account the circumstances and quantum of the offer in exercising its general costs discretion. FDC Constructions & Fitout Pty Ltd v Condensing Vaporisers Australia Pty Ltd t/as RJ Tinker and Son [7] was cited in support of this. It submitted that that discretion is most fairly exercised by only awarding the Plaintiff a fixed percentage of his costs, with such a percentage being 30%.
[3]
Plaintiff's Submissions
The Plaintiff submitted that there was nothing about this case which would suggest that the application of the ordinary rule under UCPR 42.1 would be 'unjust'.
Specifically, it submitted that the Defendant's offer was in the form of a Calderbank [8] offer, such that the general approach typically involves asking two questions, namely: (1) whether there was a genuine offer of compromise, and (2) whether it was unreasonable for the offeree not to accept it. [9]
The Plaintiff contended that there was no genuine offer of compromise by the Defendant, and it was not unreasonable for the Plaintiff not to accept it. In particular:-
1. The amount awarded to the Plaintiff at trial exceeded the Defendant's offer by more than 57% ($2,863);
2. The legal costs incurred by the Plaintiff were entirely reasonable and not disproportionate to the nature, gravity and public interest value of the claim;
3. The Plaintiff was wholly successful in his claim, such that:
1. no legal costs were 'wasted', in the sense of being incurred in relation to items on which the Plaintiff was unsuccessful, and
2. no complexity arises in the application of the general rule under UCPR 42.1 due to any 'mixed outcome'. [10]
1. The Defendant's offer was unreasonable and (likely to the Defendant's knowledge) totally "unrealistic", with the legal fees incurred by the Plaintiff up the time of the Defendant's offer on 21 May 2020 (over five months after the filing of the Statement of Claim on 5 December 2019) far exceeding $10,000.
The Plaintiff contended that special circumstances were required to justify departure from the general rule, including any "improper or unreasonable" conduct on the part of the party who has recovered judgment. It submitted that this was absent from the current matter and, as such, costs should follow the event.
It submitted that it was the whole of the DS Macnamara's conduct in question which had to be analysed to determine what aspects of LEPRA had or had not been satisfied. It was contended that to suggest that because some aspect of LEPRA was or was not satisfied should determine a costs outcome would be to improperly and artificially segment the consideration required by a court.
The Plaintiff submitted that the suggestion that the Plaintiff's manner of answering questions "took much longer and took up more time than would have been necessary", such as to amount in some type of credit to the Defendant on costs should be strongly rejected. It submitted that the Plaintiff was upset by what had happened to him, the Plaintiff's first language was not English and that for much of the evidence an interpreter was required. It was submitted that there can be no principle in determining the existence of unjust circumstances that the Court have regard to the manner in which the Plaintiff "approached the task of giving evidence".
It concluded that there were simply no special circumstances in this case where a Plaintiff successful against the Defendant for the infringement of his liberty should be out of pocket for the reasonable costs of the proceedings.
[4]
Consideration
The Defendant's offer was an offer of compromise under UCPR 20.26. In the event the offer was found to be non-compliant with the UCPR, the principles enunciated in Calderbank v Calderbank [11] were relied on by the Defendant in the alternative.
The Plaintiff exceeded the amount offered, albeit that it had much more modest success than that which was sought. The Plaintiff's refusal does not in the circumstances activate UCPR 42.15 or the principles in Calderbank v Calderbank. Moreover the circumstances are not analogous to those considered in FDC Constructions & Fitout Pty Limited v Condensing Vaporisers Aust. Pty Ltd t/as RJ Tinker and Son [12] such that the Court would adopt a similar approach. That case involved an offer which exceeded the judgment not including the interest but when the latter was added it brought it just over the offer. By contrast the Defendant's offer itself was below the judgment not including interest.
So far as the proportion between the amount claimed by the Plaintiff and that which he was ultimately awarded, there is no evidence before me beyond the offer of compromise as to the state of negotiations between the parties. At various points I did ask the parties if there would be benefit in mediation. [13] That proposal was not embraced. Nor was the position changed after orders were made requiring notices to be served by the legal representatives on their respective clients. [14]
Despite the fact that the Plaintiff's counsel indicated in closing submissions that the proposal as to the quantum of the claim was based on instructions and that she was not able to deviate from it, there was no submission advanced that there was an unreasonable refusal to mediate such that the Court should make an order reflective of that refusal. [15]
One of the difficulties during the proceedings was that the issues were poorly defined. The Defendant submitted a Statement of Issues on Day 1. [16] The Defence asserted reliance on s 99(1)(a) and (b)(i), (vii) and (viii) of LEPRA but otherwise provided no particulars in its Defence. Nor were any sought by the Plaintiff. [17] This led to objections to evidence on relevance grounds before ultimately being withdrawn. [18] At the end of Day 1, I requested the Defendant particularise the facts it asserted gave rise to the matters in [10(b)] of the Defence which related to s 99(1)(a) and(b) of LEPRA. This was attended to on Day 2. [19] They were amended during the course of evidence [20] and there was also some issue as to whether their content reflected particulars as to s 99(1)(a) and (b) of LEPRA. [21]
On Day 1 the Plaintiff supplied no Statement of Issues [22] contributing to objections and causing me to remark on that failure. [23] A broadly worded Statement of Issues was produced the following day with the Plaintiff's counsel remarking that "the issue broadly is very clear and the specifics will fall away will fall from the cross-examination." [24]
Neither the Plaintiff's opening, its Statement of Issues nor the Defence identified s 99(3) of LEPRA as an issue in the proceedings.
On Day 3 of the hearing it became necessary to seek further clarification from the Plaintiff's counsel as to the case being advanced, with the Plaintiff's counsel responding "It's a bit rubbery." [25]
The Plaintiff ultimately succeeded as the Defendant had failed to establish compliance with s 99(3) of LEPRA. Whilst I acknowledge that large parts of the cross-examination of DS Macnamara were focused as to matters concerning s 99(1)(a) and (b) LEPRA, the evidence dealing with s 99(3) of LEPRA overlapped. With respect to s 99(1)-(b) the Defendant relied on subparagraphs (i) and (viii) having all but abandoned reliance on (vii). As my reasons indicate I found that DS Mcnamara was satisfied that it was reasonably necessary to arrest under subparagraph (viii) although not under (i). DS McNamara's evidence overall contributed to the assessment made that he sought to give a hindsight reconstruction of what he believed his intentions and actions were. This was pertinent to the finding as to s 99(3).
Caution needs to be exercised in embarking on a detailed inquiry as to success or failure on issues as it may add uncertainly and complexity to the outcome of litigation. In Sanders v Snell (No 2) [26] Kirby J stated that unless there are good and exceptional reasons in the particular case to do so, a court will not ordinarily specify that cost will only be payable in respect of particular issues as "the marginal expense of calculation the costs of arguing particular issues, themes, ideas, facts cases or argument will ordinarily be outweighed by the inutility of doing so." This is especially so where there is considerable overlap between the issues that have been the subject of conflicting outcomes.
I acknowledge that the Plaintiff had language difficulties that required assistance and consequently lengthened the hearing. However as indicated in my primary judgment, the Plaintiff was a largely unreliable witness and sought to reconstruct events exaggerate their occurrence to the point of being implausible. Much of that emerged in cross-examination. The cross- examination of Sergeant Moore was limited and there was no cross- examination of Sergeant Unger.
In O'Neill v Williams & anors (costs), [27] Brereton J stated at [5]:
A departure from the ordinary rule may be appropriate where a successful party has propounded a substantially exaggerated claim and succeeds only to a limited extent, and the exaggeration has resulted in the incurring of additional costs [cf Stebercraft Pty Ltd v Sutton "The Sea Pride" (NSWSC, Carruthers J, 31 March 1994, unreported), where a party's unrelenting refusal to abandon certain claims on which it ultimately failed resulted in a dramatic prolonging of the hearing time and the magnitude of the party's claim and vigour with which it was pursued precluded any possibility of compromise]…
Whilst I am satisfied that there was some prolonging of the matter by reason of the Plaintiff's exaggeration and cross-examination on issues that the Plaintiff did not succeed, overall I am not satisfied that segmenting the costs in the way the Defendant seeks is practical or appropriate. As a matter of impression I am not satisfied that the practical difference in any event would have resulted in a trial of much shorter duration although the position may have been different if both parties better defined the issues.
The Plaintiff vindicated an important legal right being awarded an amount in excess of what the Defendant had proposed. The circumstances are not such that the Court should decline to follow the ordinary consequence provided by UCPR 42.1.
For these reasons I order the Defendant to pay the Plaintiff's costs.
[5]
Endnotes
[2020] NSWDC 377
Defendant's Written Submissions at [4], relying on University of New South Wales International House Ltd v University of New South Wales (No 2) [2017] NSWSC 306 at [19].
Jamal v State of New South Wales [2020] NSWDC 377 at [6].
Jamal v State of New South Wales [2020] NSWDC 377 at [133].
See Jamal v State of New South Wales [2020] NSWDC 377 at [139] and [145].
This was subsequently marked as MFI 6.
[2013] NSWSC 1073 at [67]-[69].
Calderbank v Calderbank [1975] 3 All ER 333.
Plaintiff's Written Submissions at [8], citing reference to Miwa Pty Ltd v Siantan Properties Pte Ltd (No 2) [2011] NSWCA 344 at [8]; cited in Tati v Stonewall Hotel Pty Ltd (No 2) [2012] NSWCA 124 at [10].
See Plaintiff's Written Submissions at [9(c)], which makes reference to Alamdo Holdings Pty Limited v Australian Window Furnishings (NSW) Pty Ltd [2008] NSWSC 7 at [20], [25], [30].
[1976] Fam 93; [1975] 3 All ER 333
[2013] NSWSC 1073.
T 80.8-.18; T 204.8-.14; T 244.18-255.6
Pursuant to s 62(6) of the 2005 Act and UCPR 42.32(b). These directions were marked as MFI 3. See T 79.33-80.04.
Halsey v Milton Keynes General NHS Trust; Steel v Joy [2004] 4 All ER 920.
T 05.16-.17.
T 47.05-.11.
T 48.1-51.37
T 77.15-.27.
T 125.05-.36.
T 188.22-189.41.
T 04.31-.33.
T 40.25-.38; T 75.08-76.07.
T 79.08-.10.
T 212.44-213.49.
(2000) 174 ALR 53 at 57, [16].
[2007] NSWSC 51.
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Decision last updated: 29 October 2020