Binge-Grose v State of New South Wales

Case •

[2017] NSWSC 388

•

11 April 2017

No judgment structure available for this case.

Supreme Court


New South Wales

  • Amendment notes
Medium Neutral Citation: Binge-Grose v State of New South Wales [2017] NSWSC 388
Hearing dates: 4 April 2017
Decision date: 11 April 2017
Jurisdiction:Common Law
Before: Adamson J
Decision:

See paragraph [93].

Catchwords:

COSTS – indemnity costs orders sought by plaintiff when defendant admitted liability – complex case requiring analysis of documents from several sources – need to assess conduct of defendant by reference to chronology rather than with hindsight – onus on practitioner certifying defence

 

COSTS – disparity between ordinary costs and indemnity costs not to be bridged by reference to plaintiff’s needs as opposed to defendant’s conduct of the proceedings

  PRACTICE AND PROCEDURE – no departure from Model Litigant Policy
Legislation Cited: Children and Young Persons (Care and Protection) Act 1998, ss 24, 26, 27, 28, 29
Civil Procedure Act 2005 (NSW), Part 6, Division 1; s 56
Evidence Act 1995 (NSW), s 48(1)(b)
Cases Cited: Binge-Grose by her tutor Binge v State of New South Wales [2016] NSWSC 1228
Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254; [2000] HCA 61
Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11
Texts Cited: Model Litigant Policy for Civil Litigation
Category:Costs
Parties: Asharney Rose Binge-Grose (Plaintiff)
State of New South Wales (Defendant)
Representation:

Counsel:
H Marshall SC/C Smith (Plaintiff)
M Fordham SC (Defendant)

  Solicitors:
Somerville Laundry Lomax (Plaintiff)
Crown Solicitors Office (Defendant0
File Number(s): 2012/197794

JUDGMENT

Introduction

  1. The plaintiff, Asharney Rose Binge-Grose, also known as Ashanti, seeks, by her tutor Shirley Binge (the tutor), an order for indemnity costs of the proceedings on liability, excepting the plaintiff’s application for liability to be heard separately from damages and the plaintiff’s application for an interim payment. The tutor is the plaintiff’s grandmother. The application is opposed by the State of New South Wales (the defendant).

  2. The tutor commenced the present proceedings by statement of claim filed in the District Court at Lismore on 13 June 2012. The plaintiff claimed damages against the defendant for injuries alleged to have been sustained by the plaintiff when she was in the care of her foster parents. The plaintiff alleged that the defendant was negligent, both in permitting her to be placed with persons whom it ought to have known were unsuitable foster parents; and in failing to monitor her while she was in their care.

  3. The defendant admitted breach of duty on 23 September 2015 and, ultimately, admitted liability on 28 October 2016.

  4. Mr Marshall SC, who appeared with Ms Smith on behalf of the plaintiff applied for indemnity costs on the following bases:

  1. The defendant ought to have admitted liability considerably earlier than it did and, had it done so, substantial costs would have been saved;

  2. The defendant’s delay in making appropriate admissions on the pleadings caused the plaintiff to incur substantial additional costs, and put the defendant in breach of its Model Litigant Policy;

  3. The defendant failed to provide documents in a timely way and thereby obstructed the course of the proceedings;

  4. In the alternative, the defendant failed to accept the plaintiff’s Calderbank offer and ought, accordingly be liable for the plaintiff’s costs on an indemnity basis from 14 March 2016 until the admission of liability on 28 October 2016; and

  5. Because the plaintiff is a young, indigenous child, it is important that the interim payment and any award of damages not be depleted by the differential between costs on an indemnity basis and costs on a party-party basis.

  1. Mr Marshall submitted that the defendant had failed to meet its obligations under the Model Litigation Policy in that it had failed to comply with the following requirements:

“The obligation requires that the State and its agencies, acting honestly and fairly in handling claims and litigation by:

…

e) where it is not possible to avoid litigation, keeping the costs of litigation to a minimum, including by:

i.   not requiring the other party to prove a matter which the State or an agency knows to be true; and

ii   not contesting liability if the State or an agency knows that the dispute is really about quantum;”

  1. Mr Marshall also relied on what was said in Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11 at [44] by Gummow and Gaudron JJ that an order that costs be paid on a higher basis is not made to punish one party to compensate the other party more fully than would have been the case but for the other party’s delinquency.

  2. Mr Fordham SC, who appeared on behalf of the defendant, resisted the order and submitted that the proceedings involved complex issues of breach and causation which needed to be fully investigated before admissions, including an admission of liability, could properly be made. He submitted that there was no undue delay on the part of the defendant and that the defendant acted at all times as a model litigant.

The factual background to the proceedings

  1. As liability was admitted, it was not necessary to determine any of the facts set out below, which are taken, in the main, from: admissions on the pleadings; agreements indicated from the bar table; and documents tendered in support of the application for indemnity costs.

What DOCS knew about William Snr and Rochelle before the plaintiff was placed in their care

  1. The plaintiff’s mother, Yvonne, had a brother, William Snr, who was in a de facto relationship with Rochelle. Their child, William Jnr, who was born in September 2005, lived with them. The Department of Community Services (DOCS) received various reports in respect of William Jnr. Such reports, which are referred to as risk of harm reports, are provided for by the Children and Young Persons (Care and Protection) Act 1998 (the CP Act). Under s 24 a person who has reasonable grounds to suspect that a child is at risk of significant harm may make a report to the Director-General of DOCS. Such reports may be made anonymously (s 26); and are mandatory in certain circumstances, such as where a child care worker becomes aware of certain matters (s 27). Records of such reports must be kept by the Director-General (s 28). The reports themselves are protected (s 29); are not admissible in proceedings save for limited exceptions (s 29(1)(d)); and need not be produced in answer to a subpoena in any proceedings (s 29(1)(e)).

  2. It was reported to DOCS that in August 2006 William Snr was removed from the residence by police because he was intoxicated. In March 2007 it was reported to DOCS that Rochelle was using methylamphetamines and disregarding the interests of William Jnr, who was found wandering unsupervised in the caravan park where the family lived, which was near a main road. In December 2007 another report was made to DOCS about William Jnr being left unsupervised when William Snr and Rochelle were affected by drugs. Concerns were expressed about the dangers presented to an unsupervised infant by a nearby lake. These incidents were recorded on a database known as the KIDS database to which DOCS had access.

  3. In early 2008, under a family arrangement, William Snr and Rochelle took on the care of Ronald, who was Yvonne’s eight-year old son. An Aboriginal Consultation Meeting (ACM) became aware that an allegation had been made that William Snr had sexually assaulted Yvonne when they were aged six and three respectively; and that in 2006 police had been called as a result of a stabbing incident in which William Snr was said to be involved. In July 2008, as a consequence of the allegations against William Snr, the ACM resolved that the placement of Ronald with William Snr and Rochelle would not be in the child’s interests and it did not support it. In September 2008 DOCS undertook an assessment of Williams Snr and Rochelle. In conducting the assessment, DOCS officers had access to at least some of the material on the KIDS database.

  4. In September 2008 DOCS approved William Snr and Rochelle as relative/ kinship carers for Ronald, who was by then eight years and eight months old. During the same month, DOCS became aware that Rochelle had reported to the Riverlands Drug and Alcohol Service in June 2008; that she had a significant history of intravenous drug use; was continuing to inject heroin and morphine daily; and that she had commenced the methadone program. In October 2008 DOCS received a risk of harm report which was believed to relate to William Jnr and two other boys, believed to be Ronald and Ronald’s younger brother, Darnelle. The allegation was that William Snr and Rochelle were intoxicated with drugs and oblivious to the whereabouts of the children under their care.

  5. Some time between October 2008 and March 2009 Ronald left the care of William Snr and Rochelle. In early 2009, Rochelle became pregnant.

The plaintiff’s birth and placement with William Snr and Rochelle

  1. The plaintiff was born on 28 January 2009 at Westmead Hospital. Her mother, Yvonne, was otherwise in gaol. DOCS assumed care of the plaintiff when she was two days old. On 3 February 2009 the Children’s Court granted interim parental responsibility of the plaintiff to the Minister for Community Services.

  2. In mid-February 2009 DOCS undertook a second Authorised Relative/ Kinship Carer Assessment in respect of William Snr and Rochelle. This assessment did not involve any health or medical checks on either of them.

  3. In March 2009, following that assessment, DOCS placed the plaintiff, who was then six weeks old, in the care of William Snr and Rochelle, whom DOCS knew to be pregnant.

  4. On 23 March 2009 Aviva Blackmore, a DOCS worker at Lismore, sent an email to Kelly Duncan, a DOCS case worker at Auburn, expressing several concerns about placing Ronald with William Snr and Rochelle again. Ms Duncan, who responded by email on 24 March 2009, expressed her agreement that Rochelle could not take on any more children, given her circumstances. On 30 March 2009 Ms Blackman sent an email to Anna Kenyon, a Casework Manager at Auburn, expressing concern about various matters, including: the effect Ronald’s return to the household would have on the plaintiff and William Jnr; whether the home was sufficiently large to accommodate another child; and the difficulties Rochelle might have in coping as the sole adult responsible for four small children while William Snr was away at work. By 30 March 2009 Rochelle told DOCS that Ronald was back in her care.

  5. On about 25 June 2009, DOCS received a risk of harm report in respect of William Jnr, Ronald and the plaintiff, to the effect that Rochelle was drug-affected and was found to have passed out on the couch, leaving the children unsupervised. William Snr was away at work during the week and, when he returned on weekends, he smoked cannabis, which was detected inside the house.

The injuries the subject of the proceedings

  1. On the following day, 26 June 2009, the plaintiff suffered a seizure at home, as a result of which she was taken by ambulance to Lismore Base Hospital, where the following injuries were recorded: swelling of the brain; increased fluid to the brain; brain abnormalities; subdural bleeds to the brain; a number of pockets of blood on the brain; bleeds to, and behind, the eye; and fractures to her legs and ankles, which had started to heal.

  2. On 17 July 2009 Dr Deanna True, a paediatrician, reported that the plaintiff’s injuries were consistent with non-accidental inflicted trauma to the head; and “Shaken Baby Syndrome”. At about this time Ms Duncan referred the matter to the Northern Rivers Joint Investigation Response Team (JIRT) for investigation. JIRT finalised its investigation in October 2009 and concluded that the plaintiff had sustained the injuries while she was in the care of William Snr and Rochelle. A document, “Secondary Assessment Stage 2”, generated by Kymm Wardrop, a Senior Case Worker from JIRT, recorded the following in Section 4, which was entitled: “Information regarding child/ young person”:

“JIRT Investigation found evidence that Ashanti was born with Agar scores within the normal range with no symptomology suggestive of drug withdrawal, neurological deficit or fractures. Ashanti's early childhood checks approximately five weeks post birth were within normal parameters with no evidence to suggest any abnormal functioning or growth. Statements provided by Caseworkers who transitioned Ashanti stated no abnormal behaviour noted in Ashanti's presentation or appearance. Information obtained from Health prior to admission was that Ashanti was referred to the Head and Neck Clinic for a headlag. Full developmental assessment unable to be completed due to Carers needs and demands during assessment. No further presentations were made prior to admission to LBH [Lismore Base Hospital].” (page 3)

  1. In Section 5, which related to “parents/ carers”, the following was recorded:

“PCH1 [Rochelle] and PCH2 [William Snr] stated to JIRT-staff that they believed that Ashanti came to them 'like this', referring to her fractures and to her brain injuries. PCH1 and PCH2 denied inflicting the injuries and stated that they must have occurred in her prior placement with Departmental Carers.

PCH1, PCH2 and maternal grandmother Mrs Shirley Binge are of the opinion that Ashanti's half sibling, Ronald, may be responsible for the fractures as he had been playing and jumped into a bean bag on which Ashanti was placed. Mrs Binge presented Ronald to Lismore Police station for interview with JIRT Police officer Ross Smith in August 2009. An aboriginal support person from the Court was made available. This caseworker has listened to the digital recording of that interview. It is clear from this interview that Ronald has been led to believe that he may be responsible for Ashanti's injuries by his family members. Medical evidence does not support this mechanism for the injuries that Ashanti sustained.

PCH1 and PCH2 underwent two placement assessments undertaken by two CSC's - Ballina and Lismore. Ballina conducted the assessment for Ashanti's older sibling and Lismore conducted the assessment for Ashanti. On both occasions they were authorised to care for each child however Departmental records note that concerns existed in relation to the capacity to adequately cope with the demands of three children in the home, whilst PCH1 was pregnant. At no time was PCH1 and PCH2's service provision from the Northern Rivers Area Health Service Drug and Alcohol service disclosed to Departmental staff.

During JIRT Caseworker interviews, both PCH1 and PCH 2 stated that they were intending for Ashanti's placement to be an interim one only and that paternal grandmother Shirley Binge had suggested them as potential carers and had been the main driving force behind the application. PCH1 and PCH2 stated that they received little support by the way of informal and familial networks.”

  1. In Section 10, which related to “Vulnerability to the risk of harm”, the following was recorded:

“Medical opinion is that Ashanti has sustained injuries over a period of time up to four weeks. During this time PCH1 and PCH2 reported to JIRT Officers that Ashanti was having 'laughing fits' and noted to have a vague look in her eyes. It is clear in view of this information, Ashanti was most likely having a series of seizures over this time. These events were not reported to either Departmental or Health staff during any of the contacts noted in the available information.

Ashanti was not being sighted by Departmental staff and an over-reliance upon self report was found within Departmental documentation. Inconsistent information was being provided to Departmental and Allied health staff by PCH1.

Little contact was made with PCH2 by all services. Inconsistent information has been provided to this Caseworker by Health staff, PCH1 and PCH2 and Mrs Binge as to the level of onsite support from family members that was being provided.” (page 7)

  1. In Section 11, which related to severity of harm and risk of harm, the following was recorded:

“Ashanti has sustained serious and inflicted injuries to the brain, retina, macular and legs. CT and MRI imaging show gross atrophy of cerebral tissue due to chronic seizures, with forensic opinion stating as being most likely attributable to repeated shaking. The timeframe of the injuries coincides with PCH1 and PCH2 being the primary carers of Ashanti.

Medical opinion is that Ashanti remains at significant risk of visual loss from her injuries and her developmental prognosis remains guarded in light of the seriousness of her injuries. The full impact of these injuries are unable to be determined at this time and can only be assessed as Ashanti continues to grow and either meets or fails to meet her milestones.

In relation to the fractures which Ashanti sustained, medical opinion is that these should heal without any ongoing disability.”

  1. In Section 14, entitled “Case Planning”, the following was recorded:

“On the evidence available to this Caseworker and on the balance of probabilities, Ashanti's injuries were inflicted by both persons by the way of shaking and impact/twisting motions. It is noted that the criminal investigation is unable to proceed due to insufficient evidence to identify the person responsible for each injury in sequence beyond a reasonable doubt.” (page 8)

  1. After the plaintiff was discharged from hospital on 27 July 2009 she was placed in departmental foster care. On 6 April 2010 there was a hearing in the Children’s Court at which the Director-General of the Department of Family and Community Services (FACS), which was formerly DOCS, was represented by Ms Hartstein of counsel. The transcript, only part of which is in evidence, recorded that Ms Hartstein told the Court:

“Whatever injuries were caused to Ashanti . . . occurred in an atmosphere of general neglect and uncaring towards the children of the house.” (tr. 31)

  1. The following exchange occurred between Ms Hartstein and the Court:

“HARTSTEIN: The Director-General's case, in relation to Rochelle's ability to provide care for whoever happened to be in her charge, is that she was taking drugs - possibly morphine that was prescribed, possibly morphine that wasn't prescribed possibly amphetamines - whatever it was, she was providing an inadequate level of care. Certainly she was not ensuring that Ronald went to school. She, it appears, caused injuries to the baby, so that, in respect of Lxxxx, you would not put a baby back into her care.

HIS HONOUR: What is your case in relation to the injuries to Ashanti? Do you say that there were only two people who had the opportunity to inflict those injuries and that was Rochelle and William?

HARTSTEIN: That's correct. And in relation to the last injury, l would say it appears that Rochelle only was present in the house. She herself says that William was not there.”

  1. In May 2010 an Internal Critical Review Report was prepared by FACS concerning the plaintiff. On the front page of the report, the following appears:

“This review report was prepared for Community Services' information.

The purpose of the report is to assist in identifying systemic and practice issues which might form the basis to make recommendations for organisational improvement, learning and development within Community Services (CS). This report should not be placed on any child protection file.

Unless stated Otherwise, the information in this report has been taken from the Community Services' casework file and electronic KIDS records. Some of the information in this report has come from child protection reports to CS that may not have been investigated and are allegations only. No investigation beyond CS records and interviews with CS staff has taken place. For the purposes of this report, the information held by CS has been relied on.

It is noted that the Review Report may be released to the NSW Ombudsman but it is not in any way held out to be an expert report and should not be treated as such in any court or other proceedings because it contains information that may not have been independently verified.

This report may contain information that identifies those who have made a risk of harm report to Community Services and contents from risk of harm reports. In accordance with section 29, Children and Young Persons (Care and Protection) Act 1998, before this report is released to any party outside Community Services (including the Coroner's Court) information that identifies a person who has made a risk of harm report or allows their identity to be deduced and the contents of risk of harm reports must be removed.”

  1. In its 82-page report, JIRT reviewed, in considerable detail, the plaintiff’s family background and the child protection history of each of the four children living with William Snr and Rochelle. It identified eight areas of concern which it referred to as “key practice episodes”, which included concerns about DOCS’s placement of the plaintiff with William Snr and Rochelle. It referred to the difficulties occasioned in some cases of reconciling the goal of a “kinship” placement for indigenous children, with a placement which would ensure the child’s safety. The report commented that case workers, who may have considered the placement to be in the best interests of the child, tended to ignore subsequent indications that the placement was not satisfactory. The report also addressed the limited information available to case workers in making such difficult assessments, including their lack of access to Drug and Alcohol Service records of carers or potential carers and restrictions on their access to the KIDs database, where risk of harm reports were recorded. In the executive summary, JIRT recounted the events of the plaintiff’s early life as follows:

“At the time of Ashanti's birth, her mother, Ms Y. Binge was incarcerated in prison. Ashanti was removed by Auburn Community Service Centre (CSC), and initially placed with CS authorised carers, who were non-Aboriginal. Children's Court proceedings were initiated. Family members, including Ms Y. Binge, and the maternal grandmother Shirley Binge (hereafter referred to as Ms S. Binge) suggested [Rochelle and William Snr] as a family placement option. These carers were living in the Lismore CSC catchment area. Auburn. CSC became aware that [Rochelle and William Snr] had previously been approved by Ballina CSC to care for Ashanti's sibling, Ronald in 2008. Auburn CSC relied on this previous approval, and requested that Lismore CSC conduct a review of the Ballina CSC assessment in order to ascertain the physical needs of the placement and the prospective carers' ability to care for a newborn child.

Lismore CSC assessed and recommended approval of this placement, with Ashanti being moved to [Rochelle and William Snr’s] care on 11 March 2009. After this point, Auburn CSC continued to monitor the placement through phone calls to the carers. Lismore CSC also provided some assistance to the family,

mainly financial support.”

  1. The plaintiff placed particular emphasis on the following passage at page 5:

“. . . the most critical issue in this review was CDCR’s [Child Deaths and Critical Incidents Reports Unit] findings that it appears that no CS worker properly identified, articulated or analysed critical information about [Rochelle and William Snr]. CDCR has found that this information should have questioned the capacity of this couple to care for Ashanti and Ronald. For example, William Jnr had a child protection history, with issues of domestic violence, drug use and neglect being reported.”

  1. In December 2010 the Children’s Court of New South Wales at Lismore ordered that the tutor be allocated sole parental responsibility for the plaintiff from 11 March 2011 until she turns eighteen.

The commencement of the proceedings

The statement of claim

  1. The tutor commenced these proceedings on 13 June 2012. The statement of claim alleged that the defendant owed a duty of care to the plaintiff; that the defendant negligently breached that duty; by failing to properly or adequately assess William Snr and Rochelle as potential carers for the plaintiff; failing to properly monitor and supervise her placement with them; and failing to remove the plaintiff from their care as soon as they received the risk of harm report on 25 June 2009.

  2. The statement of claim concluded, omitting particulars, with the following paragraphs:

“[57]    The Defendant, through its agents, servants and employees, negligently breached its duty of care to the plaintiff.

THE CONSEQUENCES

[58]    As a result of the Defendant’s negligence the Plaintiff was placed and remained in the care of William Snr and Rochelle and was at risk of harm, which harm materialised, and as a result the Plaintiff suffered, and continues to suffer, the following injuries and disabilities.

DAMAGES

[59]   As a result of the Defendant’s negligence, the Plaintiff has suffered and continues to suffer loss and damage.”

  1. An amended statement of claim was filed on 25 July 2012. These paragraphs remained in their original form. They remained largely unchanged in the further amended statement of claim filed in 2015.

The conduct of the proceedings

Instructions given to Crown Solicitor’s Office

  1. On 25 June 2012 FACS instructed the Crown Solicitor’s Office (CSO) to act on behalf of the defendant in these proceedings. On 25 July 2012 the plaintiff filed an amended statement of claim to change the name of the defendant from “Department of Human Services” to “State of New South Wales”.

  2. In August 2012, CSO received about 24 folders from FACS, which consisted of casework files in respect of the plaintiff, her siblings and her cousins. On 8 October 2012 the plaintiff served a subpoena to produce on FACS, which was returnable on 31 October 2012 and which was stood over by consent to 12 December 2012.

The involvement of Ms Taylor and Mr Fordham SC

  1. On around 15 October 2012, Ms Taylor, a solicitor employed at CSO, assumed day-to-day carriage of the matter. A week later, Ms Taylor instructed Mr Fordham SC to advise and appear on behalf of the defendant. I note that Mr Marshall confirmed that no criticism was made of either Ms Taylor or Mr Fordham’s conduct of the matter on behalf of the defendant. Ms Taylor was not cross-examined on her affidavit affirmed on 28 March 2017 in which she set out the various steps in the proceedings from the time of their commencement until the defendant’s admission of liability, from which the narrative set out in these reasons is largely derived.

The defence to the amended statement of claim

  1. On 16 November 2012, the defence, which had been certified by Ms Taylor on 12 November 2012, was filed. It contained a substantial number of admissions and partial admissions. The defendant did not admit that the assessment conducted in September 2008 on William Snr and Rochelle did not include health or medical checks, criminal history checks, or Working with Children checks, on either William Snr or Rochelle ([22] of the statement of claim). The defendant did not admit that as at 4 September 2008 the defendant ought to have known that Rochelle had a significant history of intravenous drug abuse and had commenced a methadone programme three months earlier ([28] of the statement of claim). The defendant did not admit that the plaintiff had suffered a seizure on 26 June 2009 at the home of William Snr and Rochelle; that she was taken by ambulance to Lismore Base Hospital; that she suffered the injuries particularised; or that her injuries were assessed in July 2009 as being non-accidental ([46]-[49] of the statement of claim).

  2. The only allegations the defendant denied in its original defence were: first that DOCS did not undertake any formal Authorised Relative/ Kinship Carer Assessment of William Snr and Rochelle, before it placed the plaintiff with them ([39] of the statement of claim); and, secondly, the allegations contained in paragraphs [57] –[59] set out above.

  3. On about 15 November 2012 Ms Taylor received about 33 lever-arch files of documents from FACS in relation to the matter. On 23 November 2012 the plaintiff’s solicitors raised the defendant’s non-admission of [22] and [46]-[49] of the defence. On 30 November 2012 Ms Taylor confirmed that, if further material was obtained, the defendant might seek to amend these paragraphs of the defence.

  4. On 28 November 2012 Ms Taylor caused four subpoenas to produce to be issued out of the District Court at Lismore, where the proceedings had been commenced. The subpoenas sought medical records in respect of the plaintiff.

  5. On 11 December 2012 Ms Taylor forwarded a box of documents to the District Court at Lismore in answer to the subpoena, referred to above, which had been issued on behalf of the plaintiff to FACS. The box was received by the Court on 13 December 2012 and labelled Packet S-5. It is common ground that the email dated 23 March 2009 from Ms Blackmore to Ms Dutton; the email dated 24 March 2009 in response; and the email dated 30 March 2009 from Ms Blackman to Ms Kenyon were amongst the documents produced which was contained within Packet S-5.

  6. On 12 December 2012 Ms Taylor wrote to the plaintiff’s solicitors about a subpoena issued to FACS. She referred to particular paragraphs of the schedule to the subpoena. She raised s 29(1)(e) of the CP Act and informed the plaintiff’s solicitors that, despite s 29(1)(e), she had been instructed to provide risk of harm reports. However, she referred to s 29(1)(d), which had the effect that such reports would not be admissible in the District Court, and confirmed that the defendant did not consent to the reports being admitted. Ms Taylor said further that:

“As there is a large volume of material held by my client in relation to the plaintiff, I advise that further documents will be produced in due course.”

  1. Ms Taylor also notified the plaintiff’s solicitors that objection would be taken to certain paragraphs in the schedule to the subpoena on the grounds that they were too broad or that there was no apparent legitimate forensic purpose to be achieved by their production.

  2. On 18 January 2013, Ms Taylor received a copy of the plaintiff’s medical records in answer to the four subpoenas she had caused to be issued. Following review of these documents, Ms Taylor certified an amended defence to be filed which took account of the contents of these documents. In particular, [46], which alleged that on or around 26 June 2009 the plaintiff suffered a seizure at the home of William Snr and Rochelle was admitted; and the non-admission to [47] of the amended statement of claim (which alleged that on or around 26 June 2009 the plaintiff was taken via ambulance to Lismore Base Hospital) was changed to the following:

“The defendant admits that the plaintiff was admitted to Lismore Base Hospital on 26 June 2009 and that the Patient Admission Form records the reasons for admission/ presenting problem as ‘Seizure/febrile convulsion’, but does not otherwise admit the balance of the paragraph.”

  1. On 13 February 2013, CSO retained Professor Ouvrier, a paediatric neurologist, to assess the plaintiff for medico-legal purposes. Ms Taylor informed Professor Ouvrier of the following in her letter of instructions:

“On 26 June 2009, the plaintiff was conveyed to Lismore Base Hospital by ambulance following a seizure that took place while she was in the care of [William Snr and Rochelle]. The plaintiff was later transferred to Mater Hospital for further testing. As a consequence, the plaintiff was removed from the care of [William Snr and Rochelle].”

  1. On 27 February 2013 Professor Ouvrier examined the plaintiff. On 8 March 2013, Ms Taylor wrote again to the plaintiff’s solicitor advising that privileged documents would not be produced and seeking a response to her letter dated 12 December 2012. Further documents were produced to the District Court on 4 April 2013 on behalf of the defendant in further answer to the subpoena to FACS. These documents were labelled Packet S-10.

  2. On 5 April 2013 the expert report of Professor Ouvrier dated 3 March 2013 was served. Ms Taylor also advised the plaintiff’s solicitors of production of further documents on subpoena to FACS and noted that there had been no response to her objections raised on 12 December 2012.

  3. In his report, Professor Ouvrier said, in part:

“There is insufficient evidence to prove that there may have been a pre-existing neurological disorder of a genetic or a toxic (related to illicit and prescribed drugs) or other adverse influences on the fetus during pregnancy. There is also a question of self-inflicted abdominal trauma by the mother but without more detail on the nature of this, it seems unlikely that this could have damaged the fetus. It certainly did not cause the subdural collections. It is extremely difficult to tease out the contribution of the genetic/toxic contribution to the child's current disabilities which consist mainly of epilepsy, probable mild to moderate intellectual disability, clumsiness and possibly attention deficit hyperactivity disorder.

In order to attempt resolution of these contributions, I recommend the following:

1. Review of the neuroradiological images (CT and MRI scans of the brain).

2. Eventual progress MRI scan to be deferred until the child is able to have a study without an anaesthetic

3. Eventual performance of neuropsychological testing in approximately two years' time to allow more precise assessment of intellectual function.

4. Performance of a CGH [comparative genomic hybridization] array on blood to look for the presence of cytogenetic abnormalities which may be contributing to the neurological disorder.

5. Review of the current opinion of the preschool teachers and the attending Neurologist, Dr Geoffrey Wallace, on Asharney's investigations and progress.

Given the ongoing epilepsy and the uncertainty in regard to the presence or absence of cerebral gliosis or other indicators of traumatic brain injury, in my opinion it is not possible to apportion the contributions of the above possible aetiologies with a great degree of confidence but it is most likely that one or more inflicted traumatic brain injuries between the ages of three and five months of age was (were) responsible.”

  1. Professor Ouvrier also said as follows:

“Given the possible interaction of both prenatal/postnatal developmental contributions to the problem, in addition to the effects of the traumatic intracranial bleeding, it is likely that causation is due to more than one factor. Later imaging may allow a more informed opinion of the degree of cerebral damage. It is currently not possible to be more precise about causation, as outlined above.”

  1. At a directions hearing in the District Court, the parties agreed that the matter should be placed in the inactive list by reason of the contents of Professor Ouvrier’s report. This period was extended by agreement for over two years. No orders were made to progress the matter until October 2015.

  2. On 17 October 2014 the plaintiff’s solicitors instructed Mr Ralph, a forensic psychologist, to prepare a report on liability which was ultimately received by them on 26 June 2015.

  3. In the meantime, in late 2014, Ms Taylor briefed Mr Fordham to advise on liability and quantum. On 4 February 2015 Ms Taylor briefed Mr Fordham with a further 4 lever-arch files, which brought the size of his brief to 33 lever-arch files. On about 19 March 2015 Mr Fordham provided his opinion regarding liability and quantum to Ms Taylor.

  4. On about 21 July 2015 Ms Taylor sought instructions from the defendant to serve a proposed further amended defence.

  5. On 12 August 2015 Ms Taylor received an expert liability report of Stephen Ralph from the plaintiff’s solicitors. On 17 August 2015 Ms Taylor received from the plaintiff’s solicitors an expert medical report of Dr Harbord, paediatric neurologist, dated 21 January 2015, which was expressed to be a supplementary report. On 20 August 2015 Ms Taylor was served with the primary report of Dr Harbord dated 12 November 2014 and three other expert medical reports.

  6. On 23 September 2015 Ms Taylor received instructions to serve a proposed further amended defence, which was served on that day. In this document, the defendant admitted breach of duty of care and made partial admissions of [48] and [49]. According to Ms Taylor, whose evidence was not challenged, causation was not admitted since, as far as the defendant was concerned, there remained an issue to what extent the plaintiff’s then current difficulties (which were identified by Professor Ouvrier as epilepsy, probable mild to moderate intellectual disability, clumsiness and, possibly, attention deficit hyperactivity disorder) were the result of acute injuries inflicted on 26 June 2009 or whether they were the result of prenatal or postnatal factors unrelated to the events of that day. This document was not filed as the plaintiff proposed to amend her statement of claim.

  7. According to Ms Taylor, at that time (September 2015) there were ongoing criminal proceedings relating to William Snr and Rochelle’s responsibility for the injuries to the plaintiff. Documents indicate that not only did they did not admit that they had inflicted the injuries, but they also attributed blame for the plaintiff’s injuries to her brother, Ronald. Neither William Snr nor could be interviewed by the defendant, since they had a right to silence by reason of the criminal proceedings. The plaintiff’s solicitors informed Ms Taylor that they had issued a subpoena to the NSW Police for the police brief in the matter but that it had not been produced.

  8. On 3 December 2015 a further amended statement of claim was filed by the plaintiff with the defendant’s consent. The pleading of negligence was significantly expanded. The risk of harm was specifically pleaded ([62]); the breach of duty was pleaded in terms of a failure to take precautions against a risk of harm ([63]). As to causation, it was pleaded that the defendant’s negligence was a necessary condition of the occurrence of harm ([64]); and that it was appropriate for the scope of the defendant’s liability to extent to the harm so caused ([65]).

  9. On 29 January 2016 Ms Taylor certified a defence to the further amended statement of claim, which was filed on 3 February 2016.

  10. On 11 February 2016 the plaintiff’s solicitors wrote a detailed 16-page letter to the CSO which invited the defendant to admit liability. The plaintiff’s solicitors took issue with the remaining non-admissions in the defence and referred to relevant authorities and documents produced by the defendant (through its various instrumentalities). They also reminded the CSO of the defendant’s obligations as a model litigant.

  11. Ms Taylor responded by letter dated 26 February 2016, in which she confirmed that the defendant consented to transfer to this Court. She listed the matters in respect of which the defendant had made admissions, which included admissions of duty; breach; that the risk of harm was foreseeable and not insignificant; and that the plaintiff suffered injury. Ms Taylor continued:

“In light of the admissions which have been made by the defendant, the plaintiff is essentially only now required to prove:

1.    How the plaintiff's injuries were inflicted.

2.    That the current injuries are causally linked to any assault occasioned by result of the defendant's breach of its duty of care to the plaintiff.

The defendant does not currently know who perpetrated the alleged assault(s) on the plaintiff. I note however that there are currently criminal proceedings on foot dealing with this matter, in respect of which the defendant is not a party. In addition, there remains an issue with respect to medical causation.

Depending on the outcome of further investigations and the criminal proceedings, the defendant can review its position.

The defendant is alive to its obligations, including its obligations as a model litigant. It is for these reasons that the defendant has made the admissions identified above. I note that the defendant also sought to amend its Defence to make such admissions prior to, and not in response to, the filing of the Further Amended Statement of Claim.”

  1. On 29 February 2016 the plaintiff’s solicitors wrote a letter to the CSO in terms which Mr Marshall suggested amounted to a Calderbank letter. The letter, which was endorsed “without prejudice save as to costs” referred to the previous exchange of correspondence and invited the defendant to admit liability within 14 days of the date of the letter. The letter continued:

“This offer to admit liability in respect of the injuries caused to the Plaintiff as set out in the Further Amended Statement of Claim is made in accordance with the principles espoused in Calderbank v Calderbank [1975] 3 All ER 333. In the event this offer is not accepted and our client is successful in her proceedings against your client, we put you on notice that we will be relying on this letter in support of an application for costs on an indemnity basis.”

  1. On 7 March 2016 the plaintiff filed a summons in this Court seeking an order that the proceedings be transferred from the District Court to this Court (to which the defendant had previously indicated it would consent); and an order for an interim payment. Ms Taylor responded by letter dated 4 April 2016 confirming that the defendant consented to the transfer and indicating that the defendant considered it to be in the best interests of the plaintiff that the application for interim payment be heard in May 2016 but noted that the plaintiff’s counsel was not available until July 2016. The CSO, through Ms Taylor, indicated that the defendant did not intend to oppose an order for interim payments but requested a schedule of treatment needs and costs in order that instructions could be obtained. Ms Taylor also wrote:

“While the application for interim payments is pending, the defendant seeks to assist the plaintiff and Ms Binge as much as possible. As such, I would be grateful if you could advise of the plaintiff's current address so that I can make enquiries as to medical and support services that may be currently available to her in her area.”

  1. On 26 August 2016 the plaintiff filed a notice of motion seeking orders that the question of liability be heard separately from quantum and that the defendant pay the costs of the application. On 1 September 2016 the plaintiff’s application for interim payments of $746,092 and for a separate hearing was heard by Harrison J, who delivered judgment and made orders on 5 September 2016: Binge-Grose by her tutor Binge v State of New South Wales [2016] NSWSC 1228. The defendant, who did not oppose the orders, confirmed that it would not seek repayment of the amount in the event that it was successful in defending the proceedings. His Honour noted that the plaintiff sought a lump sum costs order of the application (for a separate hearing and an interim payment, neither of which was opposed) of $468,750. His Honour refused the application and ordered that the costs of an incidental to the plaintiff’s summons filed on 7 March 2016 (for transfer of the proceedings from the District Court to this Court) and her notice of motion filed on 24 August 2016 (for a separate hearing on liability and an interim payment) be the costs in the proceedings.

  2. By a notice to admit authenticity of documents dated 6 October 2016 of 18 pages in length, the plaintiff required the defendant to admit the authenticity of a large number of documents, which had been produced in answer to subpoenas issued to the defendant, the Children’s Court and the NSW Police.

  3. On 28 October 2016, Ms Taylor wrote to the plaintiff’s solicitors informing them of her instructions to admit liability on behalf of the defendant. On 9 December 2016 the plaintiff filed a notice of motion seeking orders for judgment and that the defendant pay the plaintiff’s costs. The motion was amended on 2 February 2017 to claim costs on an indemnity basis. On 15 February 2017 Ms Taylor wrote to the plaintiff’s solicitors setting out that the defendant was prepared to pay the plaintiff’s costs of and incidental to the separate question of liability on the ordinary basis after such costs had been agreed or assessed.

Production of documents

  1. I have referred to the production of various documents in the narrative set out above. It is not necessary to recount the evidence relating to the various subpoenas that were issued and tranches of documents produced in response to them. Mr Marshall initially submitted that the emails exchanged in March 2009 were not produced until a late stage but accepted that these documents had in fact been produced as part of Packet S-5 on 13 December 2012.

  2. Mr Marshall also submitted that the defendant’s production of the May 2010 JIRT report was delayed until it was produced on 19 January 2015. Ms Taylor’s evidence about this document was that on 15 May 2014 the plaintiff’s solicitors requested a document called “Investigation and Review Branch Accountability and Review Report”. In June 2014, Ms Taylor located the JIRT report, which was entitled “Internal Critical Review Report”, which she assumed was the report which was sought. She deposed that there were privacy issues in respect of the document, which was ultimately produced in redacted form in Packet S-29, which was received by the District Court on 22 December 2014.

Consideration

  1. Because the plaintiff applied for indemnity costs on four different bases, I propose to consider them in turn. However, I am conscious that the determination of the appropriate costs order is a matter of discretion and that, accordingly, these categories ought not be viewed as necessarily discrete.

Alleged failure on the part of the defendant to provide documents in a timely way

  1. It is evident that the “State of New South Wales” incorporates a number of entities, many of which were in possession of documents relevant to these proceedings. The task of identifying and collating such documents was obviously a substantial one. There was a further issue about the operation of the CP Act and the need to protect the privacy of those mentioned in various documents. In her unchallenged evidence, Ms Taylor described this process in considerable detail.

  2. Mr Marshall submitted that I should infer from the proximity of the date of the notice to admit authenticity of documents, 6 October 2016, and the defendant’s admission of liability on 28 October 2016 that the defendant admitted liability because its attention was drawn to the wealth of evidence in its own documents to establish its liability in negligence to the plaintiff. Mr Fordham informed me from the bar table that the notice had absolutely no effect on the defendant’s decision to admit liability. In any event, I am inclined to reject Mr Marshall’s submission, which appears to be no more than a forensic flourish based on the logical fallacy to the effect that because event Y followed event X, event Y must have been caused by event X (also known as the post hoc ergo propter hoc fallacy). It is difficult to see what forensic purpose would have been achieved by the notice in any event since s 48(1)(b) of the Evidence Act 1995 (NSW) allows photocopies of documents to be tendered. Furthermore the provenance of the documents could be proved by reference to their production by the relevant instrumentalities in answer to subpoenas.

  3. The correspondence between the parties about documents indicated that there were, at times, misapprehensions on both sides about what had been produced, and at what time. Having regard to the different sources from which documents came (which led to several copies of the same document being produced from different sources and the same source), this is understandable. In circumstances where no criticism is made of Ms Taylor, who has had the day-to-day carriage of this matter from an early stage, I reject the plaintiff’s submission that any late production by the defendant of particular documents ought result in an order for indemnity costs against the defendant. I consider that, taking the evidence of document production as a whole, there is no basis for the suggestion that there was any material delay in the production of documents by the defendant that cannot be explained by their number or by the need to redact documents to protect the privacy of individuals named in the documents. I am not satisfied that the way in which documents were produced provides any basis for making an order for costs on an indemnity basis.

The defendant’s alleged failure to make admissions on the pleadings in a timely way

  1. Mr Marshall submitted on behalf of the plaintiff that there were several admissions which the defendant could, and should, have made earlier as to particular facts which had been alleged in the pleading. He submitted that, in these circumstances, the defendant ought pay the plaintiff’s costs occasioned by the need to prove those facts on an indemnity basis.

  2. The plaintiff instanced [46] of the amended statement of claim in which it was alleged that: “On or around 26 June 2009 the Plaintiff suffered a seizure at the home of William Snr and Rochelle.” Mr Marshall identified various source documents in the defendant’s possession from which it could be inferred the defendant knew the matter alleged, including: the affidavit of a case worker in the Children’s Court in which she deposed that the plaintiff was taken to hospital with seizures on that day; the hospital records which record that the plaintiff presented with “seizure/ febrile convulsion”; the record of interview with Rochelle for the JIRT investigation in which she admitted that the seizure took place at home; and the statement of the ambulance officer made in the course of the JIRT investigation as to the plaintiff’s state when he arrived at the home on 26 June 2009.

  3. The plaintiff also took issue with the defendant’s non-admission of [47] which alleged that she was taken via ambulance to Lismore Hospital on 26 June 2009. The plaintiff also criticised the defendant for not admitting [48] which alleged that at Lismore Base Hospital the plaintiff was diagnosed with multiple injuries, which were listed in the particulars. Mr Marshall referred to the affidavit of Ms Draper in the Children’s Court in which she deposed to those injuries and the report of Dr True which was tendered on behalf of FACS in the Children’s Court proceedings in 2010. Similar submissions were made in relation to [49] of the amended statement of claim which alleged that: “On or around 15 July 2009, the Plaintiff’s injuries were assessed by the Mater Hospital, Brisbane, as being consistent with: a. non-accidental inflicted trauma to the head; and b. Shaken Baby Syndrome.” Mr Marshall referred to the sworn evidence of Ms Draper and Ms Duncan in the Children’s Court to that effect; the report of Dr True and the report of Dr Kieran Moran, consultant paediatrician dated 13 July 2010 which was tendered in the Children’s Court with the consent of counsel for FACS. Submissions to similar effect were made about [52] which alleged that “JIRT concluded that the Plaintiff’s injuries were sustained whilst she was in the care of William Snr and Rochelle”.

  4. The detailed evidence of Ms Taylor, which forms part of the basis for the narrative set out above, shows that, at the time the defence was certified on 12 November 2012, the defendant did not have access to the plaintiff’s medical records. These records formed at least part of the basis of the allegations in the paragraphs set out above. As referred to above, Ms Taylor arranged to subpoena the plaintiff’s medical records on 28 November 2012. After she had received and reviewed these records she certified an amended defence in which [46] was partially admitted and [47] was admitted. Ms Taylor explained that she did not amend [48] and [49] as the list of injuries did not correspond with the medical records she had obtained on subpoena. The defendant’s response, in its defence, to [52] was:

“As to paragraph 52, the defendant admits that JIRT stated in its decision dated 21 October 2009 that the timeframe of the plaintiff’s injuries coincided with Rochelle and William Snr being her primary carers, but that there was insufficient evidence to proceed with criminal action.”

  1. In my view, the above narrative tends to show the care with which the defendant made, or refrained from making, admissions. In substance, the plaintiff’s case was based on the defendant’s documents but issues arose about the probative value of statements in the documents, depending on the purposes for which they were created. For example, that the plaintiff suffered injuries apparently while in the care of William Snr and Rochelle would tend to make them unsuitable carers of children for the purposes of Children’s Court proceedings, irrespective of how the injuries were sustained. In such circumstances, FACS would be expected to make submissions accordingly in the Children’s Court. The JIRT investigation was for the purposes of working out what had gone wrong and what could have been done better. The caveats expressed on the front page indicate the extent to which its contents and conclusions ought be qualified by the variable weight of the source documents.

  2. In this context the proposition that the Crown must behave uniformly, irrespective of context, instrumentality or emanation cannot be accepted. The proposition that the sum total of the knowledge of all servants of the Crown ought be imputed to the defendant and, by inference, the defendant’s solicitors is also flawed. The Crown, like a corporation, can act only through human agents. Ultimately, the defence it files in proceedings must be certified by an individual solicitor, who has professional obligations to his or her client, and to the Court as to what can, and should, be admitted; what can be admitted in part, and what can, and should, be denied. That solicitor can only perform that task in light of what he or she has been able to find out at the time and the instructions he or she has been given. No criticism has been made of Ms Taylor. I do not accept that the defendant’s approach to the pleadings has been in any way untoward, or in any respect such as would warrant an order that the defendant pay the plaintiff’s costs on a higher basis than the ordinary basis.

The defendant’s failure to admit liability earlier than 28 October 2016

  1. Mr Marshall submitted, in substance, that this case was one in which the defendant’s negligence, in placing the plaintiff with her uncle and his partner and in failing to monitor the placement, was so plain that the defendant ought have admitted liability within a short time of the statement of claim being served. Mr Marshall contended, in effect, that all the documents which can be taken to have caused the defendant to admit liability in October 2016 were in its possession before proceedings were even commenced and that, accordingly, the plaintiff should be compensated fully for the costs of the proceedings which should be ordered on an indemnity basis.

  2. Mr Marshall placed great weight on s 56 of the Civil Procedure Act 2005 (NSW). He reminded me of the “overriding purpose of the Act and the rules of court to facilitate the just, quick and cheap resolution of the real issues in the proceedings” and submitted that the defendant had thwarted this object by deferring the admission of liability, which was, on the evidence, inevitable.

  3. Mr Marshall’s submission has a degree of superficial attraction. When taken together, the documents identified by Mr Robin, the plaintiff’s solicitor, in the written submissions and by Mr Marshall in oral argument make a powerful case that the defendant was negligent in placing the plaintiff with William Snr and Rochelle, in circumstances which included that: Rochelle was an intravenous drug user, was pregnant and was having difficulty supervising the plaintiff’s brother, Ronald; and that William Snr was often away at work. There is also a strong argument that the plaintiff’s welfare should have been monitored by unscheduled visits to the home, rather than Rochelle being taken at her word as to the plaintiff’s well-being when case workers telephoned her.

  4. In some instances, it is appropriate for a defendant, who delays an admission of liability in circumstances where liability is clear, to be required to pay a plaintiff’s costs with respect to the issue of liability on an indemnity basis. A compulsory motor vehicle insurer who delays an admission of liability in circumstance where a pedestrian is injured as a result of a collision at a pedestrian crossing might be one example. However, the present case is not, in my view, in that category.

  5. The conduct of the CSO and defendant in the course of the proceedings is not to be judged with hindsight. It does not follow from defendant’s admission of liability in October 2016 that it was inappropriate that it did not admit liability earlier. For the reasons given above, the defendant, much less the defendant’s solicitor, is not to be imputed with knowledge of all material within documents contained in disparate files around New South Wales which could be germane to the proceedings. A defendant is not to be deprived of the opportunity to test matters and investigate them in a timely way. The defendant is entitled to obtain advice based on a relatively comprehensive factual matrix before it admits liability for a claim, particularly one which could involve very substantial damages.

  6. Moreover, although the defendant is the legal person sued for the harm inflicted on the plaintiff, it does not need to be emphasised that, in the present case, the defendant, the negligence of which is legally sufficient to ground an entitlement to damages, was not the direct or immediate cause of the injuries sustained by the plaintiff: cf. Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254; [2000] HCA 61. The defendant was not present in the home and did not know what had happened there except by inference from documents. Neither William Snr nor Rochelle could be approached in respect of the injuries sustained by the plaintiff, by reason of their right to silence because of their exposure to criminal liability.

  7. In taking into account the matters provided for in Division 1 of Part 6 of the Civil Procedure Act, I am obliged to act in accordance with the dictates of justice. One of the matters to be taken into account is the extent to which a party has utilised available procedures. Once the report of Professor Ouvrier was received, it was plain that the plaintiff’s damages could not be assessed for a period of many years. In the present case, the plaintiff could have applied for an interim payment earlier; and could have sought a separate hearing on liability and damages earlier. This is not to say that it ought to have been done earlier, but merely that it could have been done.

  8. Although the matter was placed in the inactive list, Ms Taylor continued to prepare it and obtain advice from Mr Fordham on liability and damages. The defences were amended to accord with the defendant’s improved knowledge, based on the analysis undertaken by the CSO and Mr Fordham on its behalf. I do not discern, in any aspect of the proceedings, any departure on the part of the defendant or the CSO from the Model Litigant Policy.

The Calderbank letter of 29 February 2016

  1. The plaintiff submitted that the Calderbank letter was adequate to put the defendant on notice of its application for indemnity costs if it failed to admit liability and that, accordingly, she was entitled to an order for indemnity costs from the date of expiry of the letter, 14 March 2016.

  2. The defendant submitted that the letter made no reference to the admissions of breach already made; made no reference to the issue of causation; and failed to identify any relevant prejudice. The defendant further submitted that it was not unreasonable for it to refuse the offer in circumstances where causation of injury, as opposed to extent of injury, had been conceded in the CSO’s letter of 26 February 2016.

  1. I am not persuaded that the Calderbank letter should have the effect for which the plaintiff contended. At the time it was sent, the substantial outstanding issue between the parties was the extent to which the plaintiff’s disabilities were the result of what occurred on 26 June 2009. This issue was, essentially, medical and had been identified by Professor Ouvrier in his report of 3 March 2013. It will ultimately be determined, if the matter is not resolved earlier, by this Court as part of the assessment of damages. Had the defendant made an admission in the terms sought by the Calderbank letter, this issue would have been resolved against the defendant in the absence of any resolution of the medical issues. In order to preserve its position (which remains preserved) the defendant was reasonably entitled to refuse to accept a Calderbank offer in those terms. Furthermore, it is questionable whether the Calderbank letter contained the requisite element of compromise. All the plaintiff’s solicitors did in the letter was to threaten to seek “costs on an indemnity basis” if the defendant did not admit liability. It did not differentiate between the liability and quantum aspects of the proceedings or indicate what the effect of acceptance of the offer would be in terms of costs. These matters constitute additional reasons why it was reasonable for the defendant not to accept the offer.

The alleged prejudice to the plaintiff occasioned by the difference between costs on the ordinary basis and costs on an indemnity basis

  1. Mr Marshall submitted that if the plaintiff’s ultimate award of damages were depleted by the difference between costs on the ordinary basis and cost on an indemnity basis, she would suffer further loss as a result of the defendant’s conduct, since the net award of damages (after deduction for the difference) would, necessarily, be less than that which was required to compensate her for the defendant’s tort (which would be represented by the Court’s award of damages in due course).

  2. The basis on which an order for costs is ordered to be paid (ordinary, or indemnity) is largely determined by the defendant’s conduct. It is not determined by the plaintiff’s needs or circumstances. Any successful plaintiff can expect to have to pay any difference between the amount required to be paid to legal representatives and the amount recovered from the defendant pay way of costs (subject to being in a better position as a result of a Calderbank offer or Offer of Compromise). In some cases, the shortfall is deducted directly from the judgment sum as the plaintiff has no other means to make the payment. The plaintiff is in no special position in this regard. Furthermore, as Mr Fordham submitted, there is no evidence to establish the terms of the agreement pursuant to which the plaintiff’s legal representatives were retained and therefore no basis for any inference that the legal representatives would seek to recover from the plaintiff any amounts in addition to the amount of costs paid by the defendant.

  3. I am not persuaded that there is any aspect of these proceedings which would make it appropriate to order the defendant to pay the plaintiff’s costs on the issue of liability on an indemnity basis.

Costs

  1. As the defendant has been successful in opposing the plaintiff’s amended notice of motion for indemnity costs, it would appear to be appropriate that the plaintiff be ordered to pay the defendant’s costs of the motion. However, as I have not heard argument on the question, I propose to make provision in the orders for an application for a different order.

Orders

  1. For the foregoing reasons, I make the following orders:

  1. Dismiss the plaintiff’s amended notice of motion filed on 3 February 2017 in so far as it seeks an order that the defendant pay the plaintiff’s costs on an indemnity basis.

  2. Order the defendant to pay the plaintiff’s costs of, and incidental to, the separate question of liability on the ordinary basis after such costs have been agreed or assessed.

  3. Unless any party makes an application in writing to my Association within seven days for a different order, order the plaintiff to pay the defendant’s costs of the plaintiff’s application for indemnity costs.

  4. Liberty to apply on three days’ notice.

**********

Amendments

11 April 2017 - Coversheet amended

11 April 2017 - Coversheet amendment

Decision last updated: 11 April 2017

Actions
Download as PDF Download as Word Document
Cases Citing This Decision

0

Cases Cited

5

Statutory Material Cited

3

Oshlack v Richmond River Council [1998] HCA 11
Latoudis v Casey [1990] HCA 59
Latoudis v Casey [1990] HCA 59