Templar v Britton

Judgment - ex tempore 1HER HONOUR: These are proceedings for defamation, which have come before the court on several occasions for the determination of objections to the plaintiffs' pleadings and other applications. The proceedings are listed today to hear the defendant's application in respect of the costs of those applications. The defendant has also sought an order that proper particulars be provided by the first plaintiff of his claim for financial loss, and Mr Rasmussen, who appears for the plaintiffs, has indicated that such an order can be made by consent. 2Mr Rasmussen further accepts that the plaintiff should pay the defendant's costs of each of three applications, determined in the following judgments of the court: Templar v Britton [2013] NSWSC 1827, a decision of mine published on 4 December 2013; Templar v Britton [2014] NSWSC 187, a decision of Beech-Jones J published on 5 March 2014 and Templar v Britton (No 2) [2014] NSWSC 587, a second decision of mine published on 7 May 2014. The only question is whether the court should order that those costs be payable forthwith. The usual position is that costs ordered against a party are not payable until the conclusion of the proceedings. The rules, however, contemplate that a different order can be made: See r 42.7(2) of the Uniform Civil Procedure Rules 2005. 3The decision most often cited in support of an application for an order that costs be payable forthwith pursuant to that rule rather than at conclusion of the proceedings is the decision of Barrett J in Fiduciary v Morning Star Research [2002] NSWSC 432. In that case, Barrett J noted that the authorities have identified a number of recognisable categories of cases where the court might be moved to make such an order, noting that ultimately the question should be determined according to the demands of justice. The judgment identified three kinds of category of case where the court might otherwise order. These are conveniently summarised in the decision of Simpson J in Hamod & Anor v State of New South Wales & Anor [2007] NSWSC 707 at [5] as follows: 5 Sub-r (3) was not an original component of r 9 but was added with effect from January 2000. Even before the insertion of sub-r (3), r 9(1) had contained such a power, and had been the subject of judicial consideration, and delineation of circumstances in which departure from the prima facie rule would be appropriate. The authorities are collected in (now defunct) Ritchie: Supreme Court Procedure NSW at 3154.1-3154.2. In Fiduciary Ltd v Morningstar Research Pty Ltd [2002] NSWSC 432; 55 NSWLR 1, Barrett J concluded that sub-r (3) was not intended to confine the discretion conferred by sub-r (1). Thus the authorities relevant to SCR Pt 52A r 9(1) are of guidance in the construction of UCPR 42.7. Barrett J identified three relevant factors. They may be paraphrased as follows: (i) where the costs order is relevant to a discrete, separately identifiable aspect of the proceedings; (ii) where there is demonstrated some unreasonable conduct on the part of the party against whom the costs have been ordered; (iii) where the proceedings have some distance and time to run, and it may be some time before ultimate disposition. 4During the course of argument I indicated my tentative view that the ordinary kind of pleadings stoush that frequently is determined in the Defamation List does not readily fall within the notion of a "discrete, separately identifiable aspect of the proceedings", as that notion is to be comprehended according to the authorities. Mr Sibtain did not take issue with that proposition but very properly drew my attention to a decision of Beech-Jones J to the contrary in Barach v UNSW [2013] NSWSC 1054 at 115-116. I would respectfully adhere to my tentative view on that issue, and on that basis I do not consider that the costs of the application I determined on 4 December 2013 should be payable forthwith. 5It may be accepted, as to the other two applications, that the proceedings have some distance in time to run, and that it may be some time before their ultimate disposition. Upon a careful analysis of the reasoning of Barrett J in Fiduciary v Morning Star, that would of itself in some circumstances potentially warrant the making of an order that costs be payable forthwith, but of course the court must always in exercising such a discretion consider all of the circumstances, and I do not think that is enough in the circumstances of the present case. The court must in particular have regard to the mandatory considerations in Part 6 of the Civil Procedure Act 2005 and must always be guided by the dictates of justice. 6The critical issue raised in the circumstances of the present case is the second category referred to by Barrett J, where there is demonstrated some unreasonable conduct on the part of the party against whom the costs have been ordered. A consideration of the judgments of Beech-Jones J of 5 March 2013 and my judgment of 7 May 2014 reveals what in my view may readily be characterised as unreasonable conduct; that is, the failure of the plaintiffs to prosecute their claims with due despatch which resulted in some sanctions be ordered against them. Perhaps most significantly, Beech-Jones J struck out the claim in misleading and deceptive conduct for failure to comply with an earlier order of the court, and I struck out the plaintiffs' claims as against the first and second defendants, who were individuals, on the ground of failure to prosecute the claim with due despatch. 7In my view that is conduct which, absent consideration of any other circumstance, would, prima facie, amount to unreasonable conduct such as to warrant the making of an order that the costs be payable forthwith. I must, however, have regard to the first plaintiff's affidavit sworn 11 June 2014. I interpolate to note that, extraordinarily, that affidavit was not served in accordance with my directions made 9 May 2014, which directed the plaintiffs to serve any evidence in respect of the present application by 21 May 2014. In Templar v Britton (No 2), I said at paragraph 55: I will visit upon Ms Goodchild the burden of explaining to her instructing solicitor and her clients the following matters. First, it is the responsibility of the plaintiffs and the solicitor also to prosecute the claim with due despatch, even if reliance is reasonably being placed on a barrister for that to occur. That means the plaintiffs, the solicitor and the barrister involved must all plan ahead to complete tasks as ordered by the Court. It should further be explained that the plaintiffs must be under no misapprehension that any further breach of orders of the Court will be regarded as falling at their feet and will almost certainly precipitate another application of this kind. 8Regrettably, those remarks appear to have been ignored. I, nonetheless, took the view, having regard to the content of the affidavit, that it would not be in accordance with the dictates of justice to refuse to admit it. The affidavit reveals that the plaintiff is a man of limited assets and limited income. His income is derived from a Centrelink parent payment. He has three children, two of whom suffer from significant cognitive or developmental difficulties, and that probably goes some way of explaining the circumstances of his inability to generate a greater income, notwithstanding his apparent qualification. Separately, I must have regard to the fact that the statement of claim alleges that the matters complained of have caused a downturn in the trade conducted by the company through which the plaintiff operates. 9Mr Sibtain submitted that in all the circumstances recited, particularly in my judgment in Templar v Britton (No 2), the defendant should not suffer any further delay, and is entitled to be compensated for the costs of the applications it has been forced to bring thus far, in order to see the claim prosecuted in a timely way. As a rough estimate, in response to my pressing him, Mr Sibtain informed the court that the solicitor/client costs to date of the defendant are in the order of $48,000; all of those costs being attributable to the three applications to which I have referred. That information only goes to emphasise the unreasonableness of the conduct of a party who fails to prosecute his claim or to plead it properly. 10Mr Rasmussen submitted that the strike out application, based on the alleged failure to prosecute the claim with due despatch, was not in the nature of a discrete application and should be likened to the kind of pleadings argument, which, as I have indicated, I do not consider to fall within that category. I do not accept that submission. I do think the fact that the application was precipitated by the conduct of the plaintiff and the way in which it was determined indicate that it does lend itself to the characterisation of the second category discussed by Barrett J in Morning Star. Mr Rasmussen reminded me of another decision in which I did order that costs be payable forthwith in Palace Films and submitted that this was not a case like that. Without having that decision in front of me at the moment, I cannot dispute that proposition, but my recollection is that the circumstances of this case are quite close to the circumstances of that case. 11Mr Rasmussen further submitted that the unreasonable conduct relied upon by the defendant is not "conduct of the plaintiff". It may be accepted that in my judgment in Templar v Britton (No 2) I was not persuaded that the fault for the delay in question should fall at the feet of the plaintiff personally, there having been a proper and contrite acknowledgement on the part of a legal representative as to where the fault lay. 12I confess I have not found this an easy question to determine. The affidavit does explain the plaintiff's financial circumstances and, in my view, provides a strong basis for inferring that there is a substantial risk that an order that costs be payable forthwith, at this stage of the proceedings, would stymie his prosecution of what, on its face, is a viable claim. Conversely, those very circumstances emphasise the fact that the plaintiff is a man who can ill afford to expose himself to the risk of such an order. Access to justice is a complex issue. The recognition of a power to order that costs be payable forthwith amounts to a recognition by parliament that there will be circumstances in which a party should not be forced to abide the conclusion of the proceedings in order to be compensated for costs incurred by reason of some unreasonable conduct on the part of his opponent. However, if the application of that rule carries with it the risk that the prosecution of a viable claim will be stymied, to make the order would suffer the court to become an obstacle to equal justice. A party with little means should not be prevented from prosecuting a viable claim by the exercise of such a power, in my view. In all the circumstances, with some reluctance, I have concluded that it would not be appropriate to order the costs to be payable forthwith at this stage. 13I note that the plaintiff has been in court throughout the argument this morning and during the giving of these reasons. I can only reiterate what I said at [55] of Templar v Britton (No 2), which is to make it pellucidly clear to him that it is his responsibility, and also that of his solicitor and barrister, to prosecute the claim with due despatch. That means that all those involved in the claim - the plaintiff, his solicitor and his counsel - must plan ahead to complete tasks as ordered by the court. The orders of the court are not aspirational. It should be explained to the plaintiff, and he is listening to these words now, that he must be under no misapprehension that any further breach of the orders of the court will be regarded as falling directly as his feet, and will almost certainly precipitate another application of the kind he successfully resisted in Templar v Britton (No 2). 14I order that the plaintiff pay the costs of the three applications identified in this judgment, together with the costs of the argument today. The application to have those costs ordered to be payable forthwith is refused. I order the plaintiff to provide proper particulars as requested in Hicksons Lawyers' letter, dated 22 May 2014.