On 24 March 2016, the defendant filed a notice of motion which sought seven orders. The first four orders concerned the future conduct of the proceedings. They included an order for the service of forms of particulars and the referral of the proceedings and individual claims to mediation, as well as an order that the proceedings no longer continue under Part 10 of the Civil Procedure Act 2005 (NSW). Those four orders must be considered in context with a motion filed by the plaintiffs on 30 March 2016, which sought nine orders directed to the further conduct of the proceedings and the determination of the individual claims of group members.
It suffices to state that there have been submissions directed to the general subject matter of those orders, but the parties' positions have moved considerably since the time of the filing of the notices of motion. These aspects of both notices of motion will be adjourned for two weeks to allow the parties to discuss what fell from the Bench concerning the further progress of the proceedings, including the provision of particulars, referral of the matter for a mediated outcome, and failing that, the referral of individual claims to obtain an adjudicated outcome.
The only remaining dispute so far as today is concerned are three costs orders sought in prayers 5, 6 and 7 of the defendant's notice of motion. Prayer 5 sought an order for the payment by the plaintiff of the costs of, and incidental to, the separate determination of a question concerning the appropriate foreign law, specifically the foreign law applicable to the quantum of damages sought by the plaintiff and group members. Prayer 6 sought an order that the plaintiff pay the costs of, and incidental to, an application to close the class and an unsuccessful application for discovery (see Lam v Rolls Royce PLC (No 3) (2015) NSWSC 83). Prayer 7 sought an order that there be no order as to the costs of what was in effect an aborted opt out process that occurred in 2014. Previously, the Court reserved costs in respect of all of these issues.
In respect of these matters, the first point made by senior counsel for the plaintiff, Mr Rayment QC, was that the Court should not address them at this point, but instead costs should continue to be reserved. In effect, he submitted that as the proceedings appear to be headed towards a mediated outcome and, failing that, an adjudicated outcome, it would not be conducive to their proper progress to start revisiting particular issues that occurred in the past and making costs orders.
Senior counsel for the defendant, Dr Bell SC, submitted that it is appropriate to make such orders as they can be useful in discussions over an agreed settlement. He submitted that it is difficult to revisit the rights and wrongs of some aspects of the proceedings years after the event when costs have been reserved.
The determination of whether the Court will entertain the costs application is governed by s 56 of the Civil Procedure Act. At least so far as prayers 6 and 7 are concerned, I do not consider that there is any utility at this point in determining the cost consequences of the application to close the class and the aborted opt out process. Contrary to Dr Bell's submissions, those events are not, as it were, fresh in the Court's mind. In my view, there is little utility to be gained from determining what the cost consequences of those events are now as opposed to determining them if, and when, the Court is required to determine the appropriate costs order for the proceedings as a whole.
Further, in relation to the application to close the class, whether that was an exercise that was ultimately warranted is truly a matter that cannot be determined until the proceedings come to their conclusion.
The more difficult issue is the order sought by prayer 5. By way of brief summary, from the time of the commencement of the proceedings up until 10 December 2015, the position of the plaintiff was that the proper law of the tort pleaded in its initiating process was the law of Singapore and it was that law that governed all relevant questions, including the quantum of damages. Further, it seems that from a relatively early stage, the defendant took that position as well.
In the latter part of 2015 the Court referred the matter for mediation. The Court was later advised that an issue had arisen in the mediation concerning the content of Singapore law insofar as it was said to apply to the calculation of damages for the plaintiff and other group members. The Court reserved 10 December 2015 for the hearing of a separate question to be identified, which it was hoped would resolve the impasse that had arisen in the mediation. Detailed submissions were prepared by both parties. The defendant retained an expert in Singapore law, who provided a comprehensive report. It emerged from the submissions that there was, underpinning the parties' positions, an underlying question of principle, which was left open by the decision in Regie National des Uisines Renault SA v Zhang [2002] HCA 10; 210 CLR 491 ("Zhang") (at [76]) as to whether if foreign law was a substantive law of the tort whether it also governed the assessment of damages. To that end. the submissions of the defendant and the plaintiff addressed the possibility that, notwithstanding the agreed position was that the substantive law of the tort was Singapore, whether the law of New South Wales, including the Civil Liability Act 2002, applied to the quantification of the plaintiff's claim.
However, on the morning of 10 December 2015, it seems that advice was received by the plaintiff from Mr Rayment QC, who I infer had only recently been briefed, to the effect that the underlying assumption that the proper law of the tort pleaded in the cause of action was Singapore law was mistaken, and instead it was the law relating to the place of the manufacture of the engine in question, namely the law of England and Wales. Quite properly, Mr Rayment QC raised that when the matter was called on. This inevitably led to an adjournment of what was proposed to be heard on 10 December 2015. It would have been an exercise in futility to conduct a hearing of a separate question on a hypothetical basis that the law governing the tort was Singapore when one of the parties was raising a real question as to whether it was the law of England and Wales.
At the time of the adjournment, directions were made for the service of amended foreign law notices. The matter has progressed since then. The point has now been reached where the defendant is prepared to proceed on the basis that the proper law of the tort pleaded in the cause of action is the law of England and Wales and on the further basis, left open by Zhang, that as a consequence that law governs all questions concerning the quantum of damages that may be payable to the plaintiff and other group members.
Dr Bell SC contends that, in circumstances where expense was incurred preparing for the hearing on 10 December 2015 and that the common assumption of the parties that the law of the tort was Singapore was one initially propagated by the plaintiff from an early stage of the proceedings, then the plaintiff must bear the cost consequences of the proceedings being adjourned.
Mr Rayment QC contended that in circumstances where the subsequent events are demonstrated, so he says, that that assumption was wrong and it was one that was apparently shared by both parties to the litigation, it is inappropriate for his client to wear the cost consequences of taking what is ultimately to be proved to be the correct position.
In my view, the difficulty with that latter contention is that although the defendant is now, as I have said, prepared to accept that the law of England and Wales governs the quantification of the damages, if any, payable to the plaintiff and other group members, that does not necessarily mean that that circumstance has been brought about because it accepts that it was "wrong all along". That concession may simply be a pragmatic approach adopted to progress the proceedings.
From the beginning, this has always been the plaintiff's claim. It was the plaintiff who, from a very early stage, pinned its colours to the law of the tort being the law of Singapore. Upon that assertion the defendant acted. The defendant was entitled to admit or reject the position propagated by the plaintiff and cooperate with or resist the course adopted by the plaintiff. The fact that ultimately on 10 December 2015 a common assumption, which had been generated by the plaintiff's assertion, was resiled from and costs were wasted. I think it is, in my view, one for which the plaintiff ultimately must bear responsibility.
Further, I consider it is appropriate to make an order to reflect that at this point because the events surrounding that adjournment are, as it were, reasonably fresh and relatively discrete. However, I do not propose to make an order that the costs be payable forthwith given the state the proceedings have reached. No doubt further costs applications will be made and there are significant reasons to believe that, depending upon the outcome of the assessment of her individual claim, the plaintiff is likely to recover substantial costs.
Accordingly, I will order the costs thrown away by reason of the adjournment of the hearing on 10 December 2015 be paid by the plaintiff. I do not propose to order that those costs be payable on an indemnity basis given the circumstances in which the change of position arose.
As for the balance of the defendant's notice of motion, that will, as I have said, be stood over to 29 April 2016 at 9.30am, along with the plaintiff's notice of motion. It should be evident from the exchanges that have occurred this afternoon that in the end the progress of a matter of this complexity requires that there be substantial discussions between the parties to reach a compromise as to the appropriate procedure to be adopted.
Accordingly, the Court orders:
1. The plaintiff pay the defendant's costs thrown away by reason of the adjournment of the proceedings on 10 December 2015.
2. The balance of the defendant's notice of motion sworn 24 March 2016 be adjourned to Friday, 29 April 2016 at 9.30am before Beech-Jones J.
3. The plaintiff's notice of motion filed 30 March 2016 be adjourned to Friday, 29 April 2016 at 9.30am before Beech-Jones J.
4. The parties to confer in relation to the appropriate orders for the further progress of the proceedings.
[3]
Amendments
22 April 2016 - Catchwords: change "separate quantum" to "separate question".
Decision: paragraph 2 change "sworn" to "filed".
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Decision last updated: 22 April 2016