SMD v JDW [2022] NSWDC 172 | Case summary

SMD v JDW [2022] NSWDC 172 | Case summary | Zoe

Interest

The plaintiff is entitled to interest on both general and aggravated damages for the period up to judgment pursuant to s 100 of the Civil Procedure Act 2005 (NSW). In order to calculate the amount, which is discretionary (s 100(1)), the court can attribute a portion of the award relating to pre-judgment injury so that interest can be calculated. The particular problem, in relation to child sex assault cases, is that victims commonly wait many years before bringing a complaint. This puts the calculation of interest on something of a different footing from causes of action that require immediate complaint, such as defamation.
In LT v RT [2013] NSWDC 251 Finnane QC DCJ, in the course of carrying out such a calculation to attribute two-thirds of the damage to the past, observed: "24 The consequences of physical and sexual abuse are always serious and there is no doubt that the victims of abuse are often affected for many years. They feel shame, guilt and a profound sense of worthlessness. They ask the questions; "Why me? Am I so worthless?". Very many of them do not speak about these events for many years. In her case, what made her decide to come forward was a realisation that her father, who had remarried, had a child of about four years of age. She worried that her father would abuse this child, just as he abused her. Evidence was produced at the sentencing hearing that her father had abused sexually two young half sisters of the plaintiff. This occurred overseas and he was not charged with these offences 25 I have dealt with many paedophiles during 13 years of conducting criminal trials and sentencing offenders. Many of them commit offences against many victims. It is not possible to understand why a man would sexually abuse and physically abuse his own daughter. However, he has caused her immense damage that is scarcely capable of being redressed by an award of damages. His conduct is worse than that of any other father I have encountered. 26 She is entitled to substantial damages and I award her $400,000 general damages. I attribute two thirds of the damages to the past. She is entitled to interest on the past general damages."
Ms Campbell, for the plaintiff, submits that, given the time frame of offending and the age of the plaintiff, a similar exercise of discretion would result in two thirds of the sum awarded for general and aggravated damages being the subject of interest. I accept this is the correct approach.
The next issue is the amount of interest. While awards of interest in defamation may range from 3% to as high as 6% (Rayney v State of Western Australia (No 4) [2022] WASCA 44 at [72] - [76]), a number of recent decisions in this court have calculated interest on awards for sexual abuse claims at 2%: P v D [2018] NSWDC 277 at [86]; SA v CH & LH [2022] NSWDC 140. Ms Campbell submits that 2% is the appropriate rate and I accept this.
The final issue is the determination of the years to which interest should be applied, which is also discretionary. In LT v RT, Finnane QC DCJ awarded interest for the period of 44 years, no doubt because the facts of the case were, as his Honour noted in the extract above, worse than that of any other parental offender that he had encountered. In SA v CH & LH, the period in question was 10 years, as the offending in question took place about ten to fifteen years after the offending in the present case.
In the present case, the extreme youth of the plaintiff when the offending commenced and the long period over which she suffered in my view warrant the calculation of interest for a period of twenty years.
The calculations in question for each of the awards of general and aggravated damages are as follows: 1. General damages: $200,000 ÷ 2/3 = $133,333 x 2% x 20 = $53,333 2. Aggravated damages: $100,000 ÷ 2/3 = $66,666 x 2% x 20 = $26,666
The plaintiff is also entitled to interest on past economic loss at the rate of 4% above the case rate last published by the Reserve Bank of Australia (District Court Practice Note DC (Civil) No 15).
As at 4 May 2022, the Reserve Bank of Australia's cash rate is 0.35%. Past economic loss is $150,000. Accordingly the calculation of past economic loss is as follows: 1. Past Economic Loss of $150,000 x 4.35% x 20 years = $130,500.

[4]

Costs

Costs on the ordinary basis were awarded in my judgment of 12 May 2022: see order (3). Ms Campbell acknowledges that there are no circumstances warranting an application for indemnity costs. The plaintiff does, however, seek a gross sum costs order pursuant to s 98(4)(c) of the Civil Procedure Act.
The discretion to order gross sum costs may be exercised whenever the circumstances warrant its exercise, having regard to the scope and purpose of s 98: Hamod v State of New South Wales and Anor [2011] NSWCA 375 at [813]. The factors that merit particular consideration include: 1. The complexity and nature of the proceedings in relation to their cost. 2. The degree of any disproportion between the issues litigated and the costs claimed. 3. Whether the assessment of costs would be protracted and expensive. 4. Whether a gross sum costs order would assist in bringing finality to the litigation. 5. Whether it appears that the party obliged to pay the costs would not be able to meet a liability of the order likely to result from the assessment: Penson v Titan National Pty Limited (No 3) [2015] NSWCA 121 at [5]; Star Diamond v Diamond (No 4) [2013] NSWCA 811 at [9].
Before making a gross sum costs order, the Court should have sufficient confidence that the material before it enables it to arrive at an appropriate sum for the costs order and that it can do so on a logical, fair and reasonable basis, although at a "broad brush" level: Harrison v Schipp (2002) 52 NSWLR 738; [2002] NSWCA 213 at [21] - [22].
Two questions arise for consideration. First, is this an appropriate case for ordering a specified gross sum instead of assessed costs? Second, if it is, what is the appropriate specific gross sum?
As to the first, the parties' desire for finality and the probable inability of the defendant to pay the costs make a strong argument for the award of a gross sum.
As to the second, I have been provided with a careful costing of these proceedings which result in a total of legal costs of $70,833 on a solicitor and client basis. Ms Campbell submits that a reasonable reduction to allow for party/party costs is 30%, resulting in a total of $49,583.10.
When calculating the gross sum, it should also be borne in mind that there are substantial savings for the party seeking the order in terms of avoiding the costs as well as the length of the assessment process, and a further deduction may be made for this purpose, either as part of the discount, or separately: Bobb v Wombat Securities Pty Ltd & Ors (No 2) [2013] NSWSC 863. In Bobb v Wombat Securities Pty Ltd & Ors, a deduction of 30% was made for the solicitor/client component, apparently with this factor in mind. However, a solicitor/client deduction of 20% was made in Star Diamond v Diamond (No 4), and of only 15% in Palladium Consulting Pty Ltd [2013] NSWSC 92. Even smaller discounts may be made where the legal costs are small; in Wilkie v Brown [2016] NSWCA 128, where the costs in question were only $5,000, no deduction of any kind was made.
Taking all of the above into account, I propose to make a gross sum costs order for the sum sought, namely $49,583.10 and not to make any further deductions.

SMD v JDW

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Judgment (7 paragraphs)

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Legislation Cited (1)

Cases Cited (12)