Alexander KNAUS v Bethany Eggins

[2007] ACTCA 11

ALEXANDER KNAUS v BETHANY EGGINS [2007] ACTCA 11 (7 May 2007)

EX TEMPORE JUDGMENT

ON APPEAL FROM A SINGLE JUDGE OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

No. ACTCA 7 - 2007
No. SC 493 of 2005

Judges:  Crispin P, Connolly and North JJ
Court of Appeal of the Australian Capital Territory
Date:            7 May 2007

IN THE SUPREME COURT OF THE  )   No. ACTCA 7 - 2007
  )  No. SC 493 of 2005
AUSTRALIAN CAPITAL TERRITORY  )
  )

COURT OF APPEAL  )

ON APPEAL FROM A SINGLE JUDGE OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

BETWEEN:ALEXANDER KNAUS

Appellant

AND:BETHANY EGGINS

Respondent

ORDER

Judges:  Crispin P, Connolly and North JJ
Date:  7 May 2007
Place:  Canberra

THE COURT ORDERS THAT:

1. The application for leave to appeal be refused.

1. The applicant pay the respondent’s costs.

IN THE SUPREME COURT OF THE  )   No. ACTCA 7 - 2007
  )  No. SC 493 of 2005
AUSTRALIAN CAPITAL TERRITORY  )
  )

COURT OF APPEAL  )

ON APPEAL FROM A SINGLE JUDGE OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

BETWEEN:ALEXANDER KNAUS

Appellant

AND:BETHANY EGGINS

Respondent

Judges:  Crispin P, Connolly and North JJ
Date:  7 May 2007
Place:  Canberra

REASONS FOR JUDGMENT

CRISPIN P:

1. This is an application for leave to appeal against an interlocutory decision of the Chief Justice concerning the provisions of the Civil Law (Wrongs) Act2002 (ACT) that are applicable when a party seeks an order for costs in excess of those otherwise recoverable pursuant to the provisions of ch 14 of that Act.

1. As his Honour explained in the course of his judgment, the plaintiff suffered personal injuries in a motor vehicle accident on 29 July 2003 and commenced proceedings against the defendant in January of the following year, initially in the Magistrates Court, though the action was subsequently removed into this Court.  The matter was ultimately listed before the Chief Justice and it was then revealed that the parties had agreed upon terms of settlement formalised in writing and dated 6 February 2007.  By those terms, the defendant consented to judgment for the plaintiff in the sum of $40,000 plus costs “as agreed or assessed”.  Judgment was duly entered in accordance with these terms.

1. The plaintiff subsequently made an application for costs and, after hearing counsel for the respective parties, his Honour referred to the relevant sections in ch 14 of the Act and explained that, whilst s 181 purports to control solicitor-client costs as well as party-party costs, he had been asked to make an order only in respect of costs recoverable on a party-party basis.  His Honour noted that there was a prima facie cap on the costs recoverable against the defendant that, in the circumstances, would have amounted to $10,000.

1. The application raised issues both as to counsel’s fees, which his Honour assumed were covered by the term “disbursements” in s 181 and hence not part of the fees limited by the cap, and solicitors fees, which his Honour noted were limited by the cap, subject only to any decision under s 184(1) of the Act to increase the maximum otherwise allowable.

1. His Honour heard argument in support of a contention that the maximum figure should be increased by reason of the complexity of the proceedings but did not accept that this was warranted.

1. His Honour did, however, exclude from the cap additional costs that had been incurred in considering and seeking counsel’s advice on what was described as a “Report on Collision” dated 31 March 2007.  Section 183 provides that the court may make such an order if satisfied that—

(a)the legal services were provided in response to action on the claim by or on behalf of the other party to the claim; and

(b)in the circumstances, the action was not necessary or reasonable for the advancement of the party’s case or was intended, or was reasonably likely, to unnecessarily delay or complicate determination of the claim.

1. His Honour observed that the additional costs in question had been incurred in responding to the report, which he found had been “neither necessary nor helpful”.

1. In support of the application for leave to appeal, Mr Erskine, who appeared for the applicant, submitted that this formulation suggested that his Honour had fallen into appealable error.  The test prescribed by s 183 was not specifically related to the utility of the report but required the court to consider whether the action taken had not been necessary or reasonable for the advancement of the relevant party’s case or whether that action had been intended to, or had been reasonably likely to, unnecessarily delay or complicate determination of the claim.  With due respect to Mr Erskine’s argument, I see no reason to doubt that the correct test was applied.  The remarks that I have quoted from his Honour’s judgment followed a recitation of the section which, of course, set out the correct test and it seems inescapable that, in describing the report as neither necessary nor helpful, his Honour was intending to explain why he had concluded that the “action … on behalf of the other party to the claim” had not been necessary or reasonable for the advancement of that party’s case.  The relevant action was, of course, the service of the report.  That action put the respondent on notice that the report might be tendered in evidence and hence that they would need to obtain legal advice as to its likely impact upon the case.  In view of the finding that the report was neither necessary nor reasonable, I think it is clearly implicit in the reasons for judgment that his Honour was satisfied that this action had not been necessary or reasonable for the advancement of the defendant’s case.

1. Mr Pappas, who appeared for the respondent, and sought briefly to support the application for leave, submitted that, in any event, his Honour had relied upon the wrong section.  He submitted that the provisions of s 181 to 183 were essentially concerned with solicitor/client costs and that it was only s 184 that was concerned with party/party costs.

1. Section 184(1) provides as follows:

(1)This section applies if a court, or a taxing officer, decides (on the court’s or taxing officer’s own initiative or on the application of a party to the claim) that the maximum costs for legal services allowable under this part in relation to a claim for personal injury damages should be increased because of –

(a)the complexity of the claim; or

(b)the behaviour of 1 or more of the parties to the claim. 

(2) The court or taxing officer may order that the lawyer who provided the services is entitled to stated additional costs. 

(3) If the court or taxing officer makes an order under subsection (2), the court or taxing officer may state who is to pay the additional costs.

1. His Honour did refer to s 184 during the course of his judgment and observed that the service of the report had enlivened s 184(1)(b) of the Act.  However, it seems unnecessary to consider whether his Honour applied the test in s 184 as well as that in s 183 because the result would obviously have been the same.  Having concluded, in effect, that service of the report had not advanced the defendant’s case, it was inevitable that his Honour would also have concluded that this “behaviour” was relevant to the question of costs.

1. In any event, on an application of this kind, it is incumbent upon an applicant to demonstrate not only that the Judge who made the order fell into error, but also that an injustice would occur if the order were allowed to stand.  In the present case, irrespective of any view as to the correct test that might be formed in response to Mr Erskine’s able arguments, I am simply not satisfied that such injustice would occur if the order were allowed to stand.

1. Mr Erskine did not, however, confine his argument to that issue.  He also argued that his Honour should not have expressed an opinion that counsel’s fees did not fall within the cap prima facie imposed by virtue of the definition of costs in s 180 of the Act.  Considerable argument was devoted to this issue but, in the end result, I am not satisfied that the issue was truly agitated before his Honour and it seems clear that his Honour did not purport to determine it.

1. I would also refrain from expressing any view as to that issue and would leave the matter for resolution by the taxing officer and, if necessary, any subsequent appeal that may lie from the taxing officer’s decision.  I think it is appropriate to emphasise that it is generally inappropriate for issues to be raised before the Court of Appeal when they have not been adequately ventilated in the court below.  That consideration is of even greater weight when what is sought is to be challenged is an interlocutory order relating to costs.

1. Mr Pappas sought to support the application for leave to appeal with a view to enabling his client to pursue a cross-appeal but did not make a separate application for leave to appeal independently.  He nonetheless submitted that his Honour had fallen into error by failing to find that the complexity of the proceedings warranted an increase in the amount of costs otherwise recoverable.  This submission related to an issue that would have been relevant only if leave were to be granted and the foreshadowed cross-appeal filed.  I do not accept that the contingent availability of a point that could be raised by cross-appeal would itself warrant a grant of leave to appeal against other aspects of the judgment. 

1. Several other issues were also raised during the course of argument.  Some were potentially interesting and raised points that will, no doubt, be canvassed in future proceedings.  However, it does not seem to me that they were squarely raised in the proceedings before his Honour or that we should entertain them for the first time on appeal.

1. For these reasons, I would dismiss the application for leave.

1. The order of the Court is that the application for leave to appeal be refused.

[ARGUMENT IN RELATION TO COSTS]

1. The order of the Court is that the applicant pay the respondent’s costs.

   I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment of his Honour President Crispin.

   Associate:

   Date: 29 May 2007

IN THE SUPREME COURT OF THE  )   No. ACTCA 7 - 2007
  )  No. SC 493 of 2005
AUSTRALIAN CAPITAL TERRITORY  )
  )

COURT OF APPEAL  )

ON APPEAL FROM A SINGLE JUDGE OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

BETWEEN:ALEXANDER KNAUS

Appellant

AND:BETHANY EGGINS

Respondent

Judges:  Crispin P, Connolly and North JJ
Date:  7 May 2007
Place:  Canberra

REASONS FOR JUDGMENT

CONNOLLY J: 

1. I would join the President in his orders and endorse his remarks in relation to the cautious approach that a court of appeal ought to adopt where what is sought is leave to appeal from an interlocutory decision, particularly on cost matters.

   I certify that the preceding paragraph numbered twenty (20) is a true copy of the Reasons for Judgment herein of his Honour Justice Connolly.

   Associate:

   Date: 29 May 2007

IN THE SUPREME COURT OF THE  )   No. ACTCA 7 - 2007
  )  No. SC 493 of 2005
AUSTRALIAN CAPITAL TERRITORY  )
  )

COURT OF APPEAL  )

ON APPEAL FROM A SINGLE JUDGE OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

BETWEEN:ALEXANDER KNAUS

Appellant

AND:BETHANY EGGINS

Respondent

Judges:  Crispin P, Connolly and North JJ
Date:  7 May 2007
Place:  Canberra

REASONS FOR JUDGMENT

NORTH J: 

1. I would also refuse leave to appeal for the reasons given by the President.

   I certify that the preceding paragraph numbered twenty-one (21) is a true copy of the Reasons for Judgment herein of his Honour Justice North.

   Associate:
   Date: 29 May 2007

Counsel for the Appellant/Applicant:  Mr C Erskine
Solicitor for the Appellant/Applicant:  Sparke Helmore

Counsel for the Respondent:  Mr J Pappas
Solicitor for the Respondent:  Maliganis Edwards Johnson

Date of hearing:  7 May 2007

Date of judgment:  7 May 2007