Chatley v NT of Australia - [2001] NTSC 89

Chatley v NT of Australia & Anor [2001] NTSC 89
PARTIES:CHATLEY, Stephen
v
NORTHERN TERRITORY OF AUSTRALIA
AND
JONES, Alan

TITLE OF COURT:  SUPREME COURT OF THE NORTHERN TERRITORY
JURISDICTION:  SUPREME COURT OF THE NORTHERN TERRITORY EXERCISING TERRITORY JURISDICTION
FILE NO:22 of 2000
DELIVERED:  22 OCTOBER 2001
HEARING DATES:  16 JULY 2001
JUDGMENT OF:  MARTIN CJ
CATCHWORDS:
PROCEDURE

Costs – transfer of proceedings from the Local Court to the Supreme Court – costs consequence where judgment entered within the jurisdiction of the Local Court – question of percentage of Supreme Court scale at which costs to be taxed.
Supreme Court Rules (1979) NT, O 63
Local Court Rules (1989) NT, O 38
Collins v Deflaw Pty Ltd (2000) NTSC 64, unreported, Martin CJ, 4 August 2000, considered.
REPRESENTATION:
Counsel:
Plaintiff:J Waters QC
First Defendant:     )                P Barr
Second Defendant: )
Solicitors:
Plaintiff:Caroline Scicluna & Assoc
First Defendant:     )                Povey Stirk
Second Defendant: )
Judgment category classification:    B
Judgment ID Number:  mar0129
Number of pages:  8

Mar0129
IN THE SUPREME COURT
OF THE NORTHERN TERRITORY
OF AUSTRALIA
AT DARWIN
Chatley v NT of Australia & Anor [2001] NTSC 89
No. 22 of 2000

BETWEEN:
STEPHEN CHATLEY

Appellant
AND:
NORTHERN TERRITORY OF AUSTRALIA

First Defendant
AND
ALAN JONES
Second Defendant

CORAM: MARTIN CJ
REASONS FOR JUDGMENT
(Delivered 22 October 2001)

Ruling on costs. These proceedings were settled by consent on the morning of the day fixed for commencement of the trial which had been estimated by senior counsel for the plaintiff in his certificate filed in court to take six days. The matter had been set down for hearing for that period.

The terms of consent judgment were that the defendants pay the plaintiff $33,500 plus costs to be taxed.
It was ordered that the parties make written submissions on the question of the percentage of the Supreme Court scale at which the costs were to be taxed, after which the matter was to be listed for oral argument. Written submissions were received, but neither party wished to take the opportunity to advance them further before the Court.
The orders as to costs were couched in that way taking into account the history of the proceedings, the judgment sum and matters arising as a consequence of the transfer of the proceedings from the Local Court to this Court.
The action was for damages for medical negligence and was commenced in the Local Court on 30 August 1999. The allegations of negligence broadly related to the failure of doctors employed by the first defendant and failure by the second defendant to properly diagnose and treat an injury sustained by the plaintiff to his left ring finger.
The Statement of Claim does not refer to the nature of any damage suffered by the plaintiff by way of loss of earnings or earning capacity.
By the defence liability was put in issue and it was claimed that the plaintiff had failed to mitigate his damage by unreasonably refusing to undergo medical assessment and treatment which had been recommended.
On 2 May 2000 the solicitors for the plaintiff calculated his claim for economic loss to that date at $40,000 and his loss of earning capacity at $200,000.
On 31 May it was ordered by consent that the matter be transferred to this Court. There are no documents on the Local Court file relating to the order, but it is common ground that the application was made by the plaintiff and consented to by the defendant. The consent of the defendant was unnecessary and irrelevant. The jurisdiction of the Local Court is $100,000 and in Collins v Deflaw Pty Ltd (2000) NTSC 64, unreported, 4 August 2000 I held that the Local Court has no discretion when it is faced with a claim beyond its jurisdiction. The proceedings must be transferred to this Court.
The order being made, the proceedings in the Local Court are discontinued (Local Court Act 1989 (NT) s 18(4)) and cease to be subject to the rules of that Court.
Where proceedings in the Local Court are transferred into this Court and this Court makes an order as to the costs of the proceedings in the Local Court, it may specify the costs to be allowed, order that the costs be taxed in the Supreme Court in accordance with O 63 of the Supreme Court Rules 1979 (NT) or order that the amount of those costs be determined in the Local Court in such manner as it directs (r 63.09).
It is provided in r 63.22(1) that subject to r 63.22(2) (irrelevant for these purposes) where in a proceeding a plaintiff recovers an amount which is an amount within the jurisdiction of the Local Court (this case) and the Supreme Court makes an order that the defendant pay the plaintiff’s costs of the proceedings (as here), the plaintiff is not entitled to recover from the defendant an amount for costs which exceeds that which he would have received in the Local Court, unless this Court is satisfied that he had good reason to commence the proceedings in this Court. That is not this case. The proceedings were commenced in the Local Court. However, I consider that the rule provides guidance as to the discretion available in these proceedings.
Whether there were complex issues of law or fact which could provide a good reason to commence the proceedings in this Court, as the plaintiff submits, the fact is that the plaintiff did not do that. The only reason apparent from the records for the matter to be in this jurisdiction is because the plaintiff quantified his loss as a sum in excess of the jurisdictional limit of the Local Court.
The plaintiff also submits that the claim was compromised to $33,500 asserting that it was discounted for “success prospects, contribution etc”, but “did not necessarily reflect a proper assessment of the quantum damages”. That may be so, but the essential fact is the amount for which judgment was entered, not the manner in which it was negotiated by way of settlement. The enumerated discounting factors were present when the proceedings were commenced.
Similarly, reasons advanced in relation to the perceived greater efficiency in having the case tried in this jurisdiction (par 6(iii) of the plaintiff’s submission) prevailed at the commencement of the proceedings, but the choice was made to commence in the Local Court.
The position may have been different had the plaintiff applied to transfer the proceedings upon the grounds now advanced. The basis for establishing those grounds was probably apparent when the defence was filed and should have become quite obvious once the disputes between the various medical experts and others were identified.
It might be put that the reason for the transfer into this Court was a “good reason” given that the plaintiff’s estimate of his loss at the time exceeded the jurisdiction of the Local Court. However, I have not been provided with any material by the plaintiff which could be relied upon to justify his estimate which lay at the heart of the transfer. Indeed, the material available tends in the other direction. By its particulars under O 13, r 10 of 31 October 2000, the plaintiff’s claim for past economic loss was put at $93,989 less “income earned by employment with Sahara Toys Pty Ltd from 7.5.1997, full details of which will be supplied prior to trial”. As to loss of earning capacity, he claimed a continuing loss “at the appropriate salary for a qualified chef”. However, the defendant says, and it is not challenged, that on 30 May 2001 the plaintiff’s particulars recorded that his claimed economic loss was in the vicinity of $13,344.72, about seven times less than originally alleged.
It is plain given the particulars and the settlement sum that the plaintiff’s estimate for damage was grossly inflated and that carried the consequence of the transfer to this Court.
The purpose of the rule is to protect a defendant against the unnecessary expense which may be incurred in this Court. The plaintiff succeeded, but he could have succeeded to the same extent if the matter had remained in the Local Court. Nothing in the terms of settlement nor the submissions invite me to consider the additional cost to which the defendant has been put as a consequence of the transfer and to make any set off or adjustment accordingly.
Costs ordered to be paid by the defendant are to be taxed and allowed in accordance with the Local Court Rules both in respect of the work done in that Court and in this Court.
Those rules provide for costs to be allowed at an appropriate percentage (including up to one hundred percent) of the costs set out in the Appendix to the cost rules of this Court (Local Court r 38.04(1)). Order 63 of the Supreme Court Rules apply (Local Court r 38.02).
In fixing that percentage regard is to be had to the complexity of the proceedings in fact and law, the amount awarded, the efficiency with which the proceedings were conducted and other matters considered appropriate (Local Court r 38.04(a)).
Guidance is provided in r 38.04(b) as to the percentages in relation to “the amount of the claim in the proceedings”. In this case there was no quantified claim finally put forward, there was a settlement. I consider that regard may be had to the settlement sum. To take into account an amount claimed, which may well be inflated, would cause injustice to the party ordered to pay the costs.
Taking into account the submissions, it appears that the only area of significant factual dispute in the proceedings arose in relation to quantum. Opposing specialist medical opinion was to be proffered. I regard that issue as being moderately complex, only one injury was under consideration, although involving a number of issues relating to diagnosis and treatment. It cannot be accepted that the medical issues would be resolved as simply as the defendant suggests. The contributory negligence alleged by the defendants raises additional medical and legal issues. However, I note that the learned Magistrates constituting the Local Court also constitute the Work Health Court where complex medical issues arise as do questions as to loss of earning capacity.
Whatever may be the meaning of “efficiency” in the context of the conduct of litigation, there is nothing upon which a reliable assessment could be made in this case such as to carry weight on the costs question. The taxing master will have the task of assessing what is reasonable and what was reasonably incurred (Supreme Court r 63.26).
I think justice will be done between the parties if I allow the costs at seventy five percent of the Supreme Court scale and order accordingly.
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