Abel v Amaca Pty Ltd (No 2) - [2010] SADC 167

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
ABEL v AMACA PTY LTD (NO 2)
[2010] SADC 167
Decision of His Honour Judge Barrett
22 December 2010
PROCEDURE - COSTS
Judgment has been entered for the plaintiff in his claim against the defendant for damages arising from his exposure to asbestos from products manufactured by the defendant. The damages awarded exceeded the quantum of the plaintiff's offer to accept judgment. He failed in his claims for exemplary damages and Sullivan v Gordon (s 9(3) of the Dust Diseases Act) damages. The defendant seeks its own costs of the exemplary damages claim and at least the denial to the plaintiff of his costs of the Sullivan v Gordon claim.
Held: The defendant should pay all the plaintiff's costs on a solicitor/client basis.
Dust Diseases Act 2005 s 9(3), referred to.
Sullivan v Gordon (1999) 47 NSWLR 319; Baulderstone Hornibrook Pty Ltd v Qantas Airways Ltd [2003] FCA 325; BHP Billiton Iron Ore Pty Ltd v National Competition Council (No 2) [2007] FCA 557; Elgindata (No 2) [1993] 1 All ER 232; Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd (1993) 26 IPR 261; Deacon Pty Ltd v Sebel Furniture Ltd [2003] FCA 282; Shaw v Jarldorn (1999) 76 SASR 28; McCusker v James Hardie and Coy Pty Ltd DDT No 179 of 1996; Thurbon v James Hardie and Coy Pty Ltd DDT No 7 of 1999, considered.

ABEL v AMACA PTY LTD (NO 2)
[2010] SADC 167

I delivered judgment in this matter on 23 July 2010. The plaintiff’s claim was for damages for asbestos related injury and disability suffered by him when he worked with materials containing asbestos which had been manufactured by the defendant. I found the defendant liable to pay damages under a number of heads. I rejected the plaintiff’s claims for exemplary damages and Sullivan v Gordon damages (s 9(3) of the Dust Diseases Act). I ordered the plaintiff $155,967 damages. That sum exceeded the plaintiff’s filed offer to accept $125,000.
The defendant concedes that ordinarily in these circumstances the plaintiff would be awarded all his costs on a solicitor/client basis. The defendant submits however that in this case the plaintiff should not recover his costs of prosecuting his unsuccessful claim for exemplary damages and his Sullivan v Gordon damages. The defendant seeks an order that the plaintiff pays its costs of the exemplary damages claim and it seeks “at least a denial of costs on the Sullivan v Gordon claim”
Exemplary damages claim
The defendant submits that much time was taken up with the exemplary damages claim. It submits there is authority for the proposition that, as trials have become longer and issues multiplied, there is a tendency in courts to look more critically at claims by successful parties for all their costs when they have not been successful on some. The defendant points to remarks of Finklestein J in Baulderstone Hornibrook Pty Ltd v Qantas Airways Ltd [2003] FCA 325 at [4]. His Honour there said:
The days when a plaintiff could, with impunity, mount an attack on several fronts, some with little prospect of victory, in the hope of a direct hit on the recoverable costs must be put behind us.[1]
[1] See also Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd (1993) 26 IPR 261 at 272 (Full Court of Australia) and Deacon Pty Ltd v Sebel Furniture Ltd [2003] FCA 282 at [13] per Alsopp J.
The defendant submits that there is some assistance to be found in identifying criteria for denying costs in BHP Billiton Iron Ore Pty Ltd v National Competition Council (No 2) [2007] FCA 557 at [23]. Middleton J said that one should consider:
Appropriate case management principles, the relative merits or strengths of the lost issue or enquiry, whether the length of the proceedings have been greatly increased by the lost issue or enquiry in which the successful party failed, and whether the issue or enquiry in which the successful party failed was of sufficient significance in proportion to the whole case to warrant a special order to deprive that party of the costs of that issue.
The defendant concedes that where an unsuccessful party asks the court to do more than simply deny a successful party its costs on an unsuccessful point, and go further to actually order the successful party to receive its costs, then it should demonstrate impropriety or unreasonableness (re Elgindata (No 2) [1993] 1 All ER 232 at 277.
I think that the defendant is mistaken in the factual assertion which underpins its submission on the exemplary damages claim. In my view there was a very considerable overlap between the plaintiff’s successful claim that the defendant was liable to pay him damages for his losses, and his unsuccessful claim for exemplary damages. To prove liability the plaintiff had to prove that the defendant had actual or constructive knowledge that his exposure to its products might harm him. The defendant denied liability. Before trial, the defendant denied that the plaintiff was exposed to its products. More accurately perhaps, it did not accept that the plaintiff was exposed substantially to its asbestos products alone. However relatively earlier in the trial the defendant conceded limited exposure by the plaintiff to its products. The defendant denied foreseeability of risk of harm to the plaintiff. It denied it owed him a duty of care. It denied it breached any duty. The plaintiff had to, and did, prove all of these matters. The entitlement to exemplary damages was really an exercise in describing and characterising the defendant’s proved behaviour. The plaintiff was successful in proving the defendant had certain knowledge about the danger of its products to end users during the plaintiff’s exposure to its products. He was unsuccessful in persuading me that the defendant’s possession of that knowledge made its behaviour so reprehensible that it called for a punitive order for exemplary damages. To prove liability the plaintiff needed to present a substantial body of historical material about the growing industrial knowledge of the risks of asbestos before, during and after the plaintiff’s own exposure.
While I am unable to be precise about the overall effort devoted exclusively to the exemplary damages point, my impression is that it was small when compared to the liability point.
It should also be borne in mind that much, if not most, of the historical documents had been tendered in earlier cases against the defendant. In fact the plaintiff sought to rely on the findings in those cases[2]. While these cases did not involve claims for exemplary damages they did involve questions of contested liability.
[2] McCusker v James Hardie and Coy Pty Ltd (DDT No 179 of 1966) and Thurbon v James Hardie and Coy Pty Ltd (DDT No 7 of 1999).
I have had regard to the discussion by Doyle CJ in Shaw v Jarldorn (1999) 76 SASR 28 at [4], [9] and [10] about the effect of the predecessor to 6DCR 188. His Honour said:
… I emphasise that both the defendant and the plaintiff will be assumed to anticipate the ordinary risks and ficissitudes of litigation. In deciding not to accept an offer a defendant makes the judgment that it will run the risk of the plaintiff equalling or bettering the offer, in the hope that the plaintiff will recover less than the amount of the offer. A defendant who makes that choice cannot reasonably complain, if, as a result of the ordinary risks and ficissitudes on litigation, the defendant’s judgment is proven to be unsound[3].
[3] [8]
Further His Honour said:
Putting it bluntly, once a plaintiff makes an offer that attracts the operation of [6DRC 188 (6)], the defendant who does not accept that offer accepts the risk of the plaintiff bettering the offer, and obtaining an order for the whole of the costs of the action as between solicitor and client. Having regard to the purpose of the rule and the manner in which it operates, it will only be in limited circumstances that a defendant will be able to demonstrate that it is proper for the court to order that the plaintiff should not recover costs as between solicitor and client.[4]
[4] [9]
I decline to deny the plaintiff his costs on the exemplary damages point. It follows that I decline to award the defendant its costs on that point.
Sullivan v Gordon (s 9(3)) damages
The plaintiff succeeded in demonstrating that his asbestos-caused medical conditions had resulted in losses of function and amenity. In particular he persuaded me that he is no longer able or inclined to continue with his principal pre-injury interest in woodworking and furniture making [186]. I considered those losses of function and amenity when awarding general damages. The plaintiff did not persuade me that that loss could be characterised as a loss for which damages should be awarded by reason of his being less able to perform domestic services to another person as contemplated by s 9(3) of the Act.
Analogously with the exemplary damages point, the principal loss of amenity had to be proved to found the claim for general damages. The defendant contested the causal link between the plaintiff’s exposure and that particular loss.
Again without being able to be precise, it appears to me that the additional effort made to bring the proved loss of impairment within the reach of s 9(3) was relatively minor. I decline to deny the plaintiff his costs of this failed application. It follows that I decline to award the defendant its costs.
Order
I order that the defendant pay the costs of the plaintiff on a solicitor/client basis.