Concept Engineering (Aust) Pty Ltd v UGL Unipart Rail Services Pty Ltd

[2020] NSWDC 536

District Court

New South Wales

Medium Neutral Citation:

Concept Engineering (Aust) Pty Ltd v UGL Unipart Rail Services Pty Ltd [2020] NSWDC 536

Hearing dates:

2, 3, 4, 5, 6, 11 December 2019; 7 April, 13 May, 12, 19 June, 31 August, 1, 2, 3 & 4 September 2020

Date of orders:

18 September 2020

Decision date:

18 September 2020

Jurisdiction:

Civil

Before:

Judge Levy SC

Decision:

1. The plaintiff is to pay the defendant's costs of the proceedings on the ordinary basis up to and including 19 May 2020, and on an indemnity basis from 20 May 2020;

2. In lieu of the order made on 4 December 2019 concerning the costs of a mediation, those costs are to be paid equally between the plaintiff in these proceedings and Ms Jamile Aerenga, the plaintiff in the associated proceedings 2015/360589;

3. The exhibits may be returned;

4. Liberty to apply on 7 days’ notice if further or other orders are required.

Catchwords:

COSTS – liability for costs following settlement – determination of the basis upon which the successful defendant’s costs should be paid by a worker’s compensation insurer which brought the proceedings in the name of the plaintiff company by way of subrogated right pursuant to s 151Z of the Workers Compensation Act 1987 (NSW)

Legislation Cited:

Civil Procedure Act 2005 (NSW), s 56 to s 58, s 98, s 99

Court Suppression and Non-publication Orders Act 2010 (NSW), s 7

Uniform Civil Procedure Rules 2005, r 20.26, r 42.1,

Workers Compensation Act 1987 (NSW), s 151Z

Cases Cited:

Al Mousawy bht Khamis v JA Byatt Limited & Others [2008] NSWSC 264

Gray v Richards (No 2) [2014] HCA 37

House v The King (1936) 55 CLR 499; [1936] HCA 40

Northern Territory v Sangare [2019] HCA 25

Oshlack v Richmond River Council (1998) HCA 11 193 CLR 72

Category:

Costs

Parties:

Concept Engineering (Aust) Pty Limited (Plaintiff)
UGL Unipart Rail Services Pty Limited (Defendant)

Representation:

Counsel:
Mr W Reynolds (Plaintiff)
Ms K Nomchong SC with Mr M Best (Defendant)

Solicitors:
Moray & Agnew (Plaintiff)
Cantle Carmichael Legal (Defendant)

File Number(s):

2015/288696

Publication restriction:

A non-publication order has been made with respect to the name of a child referred to in Exhibit “7”.

Judgment

1. The residual issue to be determined in these protracted proceedings is the question of the basis upon which the plaintiff, Concept Engineering (Australia) Pty Limited (“Concept”) should be held liable for the costs of the defendant, UGL Unipart Rail Services Pty Limited (“UGL”), where Concept ultimately consented to a verdict and judgment in favour of UGL after 14 days of hearing.

Non-publication order

2. Pursuant to s 7 of the Court Suppression and Non-publication Orders Act 2010 (NSW), an order has been made prohibiting the publication of the name of the child referred to in Exhibit “7”.

Factual background

3. The proceedings were settled as between Concept and UGL on 3 September 2020 on the basis that a verdict and judgment was entered in favour of UGL, with Concept to pay UGL’s costs. The residual element of dispute requiring resolution is whether, and from what date, UGL’s costs should be paid by Concept on the indemnity basis.

4. The proceedings were brought by Concept’s workers’ compensation insurer, AAI Limited, trading as GIO Workers’ Compensation Insurance (NSW) Limited, by way of subrogated right seeking, pursuant to s 151Z of the Workers Compensation Act 1987 (NSW), recovery from UGL, an alleged tortfeasor, of substantial monies that insurer had paid to or on behalf of an employee of Concept, a labour hire company, in respect of serious allegations of injurious sexual harassment in the workplace of UGL, where Concept allocated its employee to carry out her work.

5. The employee who claimed to have been adversely affected by that conduct, Ms Jamile Aerenga, also known as Jamilee Aerenga and Jamile Mannah, had brought proceedings against UGL claiming damages for alleged serious psychological harm due to alleged sexual harassment which she claimed she had been subjected to by a manager also in the employ of UGL: Jamile Aerenga (Nee Mannah) v UGL Unipart Rail Services Pty Limited, proceedings in this Court numbered 2015/360589.

6. Ms Aerenga made a claim for worker’s compensation from Concept in March 2014. That claim was accepted and payments were made to her until February 2019.

7. On 2 October 2015, Ms Aerenga filed her statement of claim against UGL. The fifth iteration of that document was the basis upon which that case went to trial. The defendant, UGL, either denied or did not admit all material allegations made by Ms Aerenga.

8. Before Ms Aerenga had commenced her proceedings against UGL, Concept had commenced its proceedings against UGL seeking to recover those workers’ compensation payments made to or on behalf of Ms Aerenga.

9. On 12 September 2018, Concept was joined as a second defendant to Ms Aerenga’s proceedings. It remained a defendant in those proceedings until 9 July 2020, when other interlocutory proceedings, not requiring further description here, resulted in the removal of Concept as a defendant in the proceedings brought by Ms Aerenga.

10. The trial of the two sets of proceedings was ordered to be heard concurrently, with evidence taken in one case to be read as evidence in the other case. The proceedings took a chequered course.

11. The trial proceeded between 2 and 11 December 2019. Other dates then followed in 2020, namely 7 April, 13 May, 12 and 19 June, and then 31 August to 4 September 2020.

12. On 2 September 2020, the twelfth day, Ms Aerenga’s case was settled on agreed terms with the entry of a verdict and judgment in favour of UGL, along with the requirement that she pay UGL’s costs as agreed or assessed. The present case was settled on the following day.

13. At that time UGL signalled an intention to pursue a special costs order against Ms Aerenga’s legal advisors pursuant to s 99 of the Civil Procedure Act 2005 (NSW) (“CP Act”). In these reasons it is not necessary to give further consideration to that intended course. The pursuit of an order along those lines will require a separate application, duly served on proper notice, at some later date.

14. Ms Aerenga’s proceedings, which also formed the factual basis of Concept’s proceedings, were protracted because, shortly stated, at times during the initial phase of the hearing in December 2019, Ms Aerenga exhibited significant emotional distress, following which, her proceedings, and these associated proceedings, had to be adjourned. During that period of adjournment the parties participated in a Court-ordered mediation which unfortunately proved unsuccessful.

15. Ms Aerenga’s proceedings were vigorously defended by UGL. Settlement of those proceedings occurred at a time when Ms Aerenga was under sustained cross-examination. In preparation for the trial, UGL’s legal representatives had amassed voluminous subpoenaed materials comprising some 46 categories of documents. In addition, they also obtained access to substantial surveillance and investigation materials. All of those materials were aimed at seeking to undermine and refute the factual basis of Ms Aerenga’s claims.

16. It appears that UGL had no choice but to take those described preparatory steps if it intended to mount a defence to the serious allegations made both in the primary case as brought by Ms Aerenga and in the satellite claim brought by Concept.

17. Ms Aerenga’s proceedings settled at a time when her evidence-in-chief, and her credibility and reliability as a witness were being tested by cross-examination in light of the content of those described materials.

18. The circumstances described above formed the background for UGL’s application in these proceedings for its costs to be paid by Concept.

19. Although UGL maintained that Concept’s recovery action was independent of Ms Aerenga’s evidence, because the proceedings brought by Concept sought indemnity from UGL for worker’s compensation payments, I do not accept that submission. The distinction sought to be made by UGL was without significance. The liability of UGL depended upon the result of the proceedings brought by Ms Aerenga. Plainly, in the end, Concept was forced into a distress settlement.

Evidence on the application for a special costs order

20. On 3 September 2020, when settlement of the present s 151Z proceedings was announced, save as to the basis for liability for costs, I ordered that overnight, the parties file and serve affidavit evidence so that the costs argument could proceed the next day, on 4 September 2020.

21. In response to that order, UGL relied upon the affidavit of its solicitor, Ms Cantle, sworn on 4 September 2020. Her affidavit outlined the position regarding orders made for the timetabling of affidavit evidence concerning the costs arguments, as follows:

1. On 3 September 2020 the Court Ordered the Plaintiff to serve any affidavit upon which it intended to rely by 6.00 pm. The Defendant was ordered to serve any affidavit in response by 10.00 am on 4 September 2020.

2. No affidavit was received from the Plaintiff. At 6.42 pm I sent an email to the Plaintiff’s solicitor enquiring as to when the Plaintiff would be complying with the Order. At 7.10 pm I received an email from the Plaintiff’s solicitor stating; “At this time we are not relying upon affidavit evidence.” ”

   22. Ms Cantle’s affidavit set out some relevant historical matters supported by annexed documents. That affidavit was read without objection. Ms Cantle was not required for cross-examination. An extract from her affidavit is as follows:

“The Documents Available to the Parties

1. Since the proceedings were commenced 46 separate Subpoenas to Produce documents were issued by the parties. Annexed hereto and marked with the letter “B” is a print-out from the NSW Online Registry detailing the dates the subpoenas have been issued and the dates the dates upon which the documents were produced.

2. On 2 December 2019 UGL provided to Concept a Court Book. The Court Book was marked for identification MFI #5 (Transcript page 7). The contents of the Court Book included the medical and other evidence served upon Concept and to be relied upon by UGL. Annexed hereto and marked with the letter “C” is a copy of the index to the Court Book.

3. Specifically, the Court Book included Dr Vickery’s reports dated 4 April and 15 May 2017. Dr Vickery was retained by Concept to assess Mrs Aerenga.

4. On 31 August 2020 UGL provided copies of Supplementary Court Books Volume One and Volume Two to Concept.

5. Volume One of the Supplementary Court Book contained documents produced under subpoena by:

   a.   The New South Wales Department of Education (James Busby High School);

   b.   The NSW Worker’s Compensation Commission;

   c.   UGL (Lance Miles);

   d.   Concept;

   e.   UGL (2013 Investigation documents);

   f.   Anti-Discrimination Board; and

   g.   Australian Super.

6. Volume Two of the Supplementary Court Book contained documents produced under subpoena by fifteen medical practitioners and hospitals from whom Mrs Aerenga had sought treatment before and after the events which were the subject of her claim for damages against UGL and Concept’s claim for indemnity.

7. All the documents contained within UGL’s Court Book and Volumes One and Two of the Supplementary Court Books were documents produced under subpoena and available for inspection and consideration by Concept prior to 19 May 2020.

8. Volume Three of the Supplementary Court Book (tendered on 3 September 2020) contained documents produced under Subpoena in the Concept proceedings by Challenge Community Services. The documents were produced to the Court on 4 November 2019 and the Court granted “general access” to all parties on 7 November 2019. As such, those documents were also available for inspection and consideration by Concept prior to 19 May 2020.

9. Volume Four of the Supplementary Court Book (tendered on 3 September 2020) contained numerous surveillance reports obtained by Concept between September 2014 and February 2016 and a social media investigation report obtained by Concept on 5 June 2015. Crucially, the surveillance reports demonstrated Mrs Aerenga undertaking activities - inconsistent with her asserted disabilities and the social media investigation revealed she had been married to Tupuna Aerenga in 2015 - another glaring inconsistency in her assertions of psychological distress and self-isolation from her family. The surveillance reports of M&A Investigations were commissioned by Concept and were therefore available to Concept at (or about) the date of each report.”

   23. In addition to Ms Cantle’s affidavit, UGL relied upon two notices to produce that had been served on Concept (Exhibits “5” and “6”), as well as six bundles of financial schedules that included remittance advices quantifying payments that Concept’s worker’s compensation insurer had made to Ms Aerenga (Exhibit “7”), and an offer of compromise UGL served on Concept on 19 May 2020 (Exhibit “8”).

   24. Concept did not file any evidence on the costs application. This was stated to have been due to the time constraints imposed by my orders. As identified in Ms Cantle’s affidavit, at 7.10pm on 3 September 2020, Concept’s solicitor advised UGL’s solicitor that it did not propose to file any affidavit evidence as to costs. On 4 September 2020, no application was made by Concept to seek an extension of time in relation to the timing for compliance with the order for service of evidence and submissions.

   25. It is necessary to outline the offers of settlement and related negotiations which lay behind the present costs application.

Offers of settlement

26. On 19 May 2020, the solicitor for UGL, Ms Cantle, served an offer of compromise on Concept’s solicitors, Messrs Moray and Agnew. That offer was in accordance with UCPR r 20.26: Exhibit “8”. (The 19 May 2020 offer)

27. That offer provided an opportunity for Concept, if it wished to do so, to terminate these proceedings by accepting a verdict and judgment in favour of UGL. That offer was stated to remain open until it was due to lapse at 5.00pm on 11 June 2020. It made no provision for costs. That offer was rejected later that same day.

28. In rejecting that offer, Messrs Moray and Agnew, the solicitors for Concept, asserted on behalf of their client: “We fail to see any circumstances where our client’s claim for recovery does not succeed”: Annexure “D” to the Affidavit of Ms Cantle, page 60.

29. It is difficult to understand a basis in merit for that stance taken on behalf of Concept given the mass and content of the material which UGL had accumulated in order to seek to traduce the claim brought by Ms Aerenga, where that course would have inevitably also had a corrosive effect on the claim brought by Concept.

30. It appears that on 19 May 2020 the die was cast for the subsequent course of the litigation. This was at a time when substantial further costs were about to be incurred by UGL to protect itself from financial exposure to not only Concept’s claim, but also to Ms Aerenga’s claim, which was to be heard at the same time.

31. Given the nature and content of Ms Aerenga’s claim and the satellite claim by Concept, UGL was plainly justified in retaining senior counsel to cross-examine Ms Aerenga in order to challenge her evidence on a wide range of issues also involving a broad range of significant documents.

32. On 31 August 2020, whilst Ms Aerenga was still being cross-examined, UGL made a further offer to Concept by which Concept was invited to consent to a judgment in favour of UGL, with each party to pay its own costs. That offer was rejected without a counter offer. (The 31 August 2020 offer)

33. On 2 September 2020, UGL made an offer to Concept that judgment be entered for UGL with Concept being expected to only pay UGL’s costs on the ordinary basis from 20 May 2019. That offer was also rejected. (The 2 September 2020 offer)

34. Ms Aerenga then settled her claim on the basis that is identified in paragraph [16] above.

35. On 3 September 2020, after Ms Aerenga’s claim had been resolved, Concept offered UGL a settlement whereby UGL would receive the benefit of a verdict in its favour, with each party to bear its own costs. That offer was rejected by UGL. (The first 3 September 2020 offer)

36. At a later point on 3 September 2020, UGL re-put its 2 September 2020 offer to Concept, which was rejected. (The second 3 September 2020 offer)

37. On 3 September 2020 Concept ultimately submitted to an order that there be a verdict and judgment for UGL on Concept’s claim, with costs to be reserved for argument.

38. UGL’s costs in dispute, whilst not yet quantified are obviously likely to be substantial. Those costs relate to the issuing of subpoenas, inspecting voluminous documents to which all parties had access, commissioning investigation reports, and related necessary preparation for trial.

Competing arguments as to costs

39. On 4 September 2020 the parties provided written outlines of their submissions on the costs issue. UGL’s written submissions were marked MFI “5”. Concept’s written submissions were marked MFI “4”.

40. UGL made costs submissions to the effect that Concept pay UGL's costs on the ordinary party and party basis up to and including 19 May 2020; and on an indemnity basis from 20 May 2020, and that in lieu of the mediation costs order made on 4 December 2019, an order was sought that the costs of the mediation be paid equally between UGL and Ms Jamilee Aerenga, the plaintiff in the associated proceedings 2015/00360589.

41. In contrast, Concept made costs submissions to the effect that each party pay their own costs of the proceedings, except that UGL was to pay Concept’s costs of the hearing on 3, 4, 5 and 6 December 2019, by reason of UGL's failure to comply with subpoenas for production of documents, submitting that such costs be agreed or assessed, and that UGL was to pay Concept’s costs of the Court-ordered mediation on 19 November 2019.

42. At this point I state my conclusion that the mediation costs order sought by Concept, based on an alleged absence of good faith by UGL at the mediation should not be accepted.

43. I consider that conclusion must necessarily apply because, in fairness, to accede to Concept’s submission would involve examining the detail of what occurred at the mediation.

44. I find that such a consideration would be inappropriate as evidence of those matters is not admissible. Concept pointed to a decision which suggested that a contrary course might be open: Al Mousawy bht Khamis v JA Byatt Limited & Others [2008] NSWSC 264. It is clear that decision was based on its own particular facts. In my view, properly understood, that decision does not assist Concept in achieving the outcome on mediation costs as sought in this instance.

Legislation

45. Section 98 of the CP Act provides the Court with a wide discretion as to costs, including as to who should pay particular costs in relation to particular points in time, and on what basis those costs should be paid.

46. Rule 20.26 of the UCPR provides for the making of formal offers of compromise at any stage of proceedings. UGL’s offers were compliant with this provision.

47. Rule 42.1 of the UCPR provides for costs to follow the event unless it appears that some other costs order is more appropriate.

Relevant principles

48. The determination of the order for costs that is appropriate to the circumstances of the case involves the exercise of discretion: s 98(1)(a) of the CL Act; UCPR, r 42.1.

49. That particular discretion is generally guided by the result of litigation, which means that a successful litigant is generally entitled to an award of costs subject to just exceptions.

50. Such exceptions, non-exhaustively, include a party’s laxity, disentitling conduct in the litigation, needless prolongation of the litigation, litigating to increase costs, and obtaining relief that has already been offered: Oshlack v Richmond River Council (1998) HCA 11 193 CLR 72, at [66], [68]-[70].

51. The overall requirements of justice in a particular case is an important consideration to be taken into account in the exercise of a costs discretion: Gray v Richards (No 2) [2014] HCA 37. In that case, at [2], the following uncontroversial statement of principle appears:

“The disposition of costs is within the general discretion of the Court. Ordinarily, that discretion will be exercised so that costs are awarded to the successful party, but other factors may have a significant claim on the discretion of the Court. The disposition which is ultimately to be made in any case where there are competing considerations will reflect a broad evaluative judgment of what justice requires.”

[References omitted]

52. Although trite, it bears restating that the costs discretion is to be guided by identifiable factors: Northern Territory v Sangare [2019] HCA 25. In that case at [25] the following statement appears:

“A guiding principle by reference to which the discretion is to be exercised – indeed, "one of the most, if not the most, important" principle – is that the successful party is generally entitled to his or her costs by way of indemnity against the expense of litigation that should not, in justice, have been visited upon that party. The application of that principle may be modified or displaced where there is conduct on the part of the successful party in relation to the conduct of the litigation that would justify a different outcome. For example, a successful defendant may be refused its costs on the ground that its conduct induced the plaintiff to believe that he or she had a good cause of action. But in the present case, there was nothing of this kind in the conduct of the appellant in relation to the litigation that might have weighed against the exercise of the discretion in its favour. There was no suggestion of any conduct on the part of the appellant, whether by unreasonable delay or a want of the cooperation required of litigants to ensure the "just resolution of the real issues in civil proceedings with minimum delay and expense", that might have been taken into account to justify refusing the appellant an order for its costs.”

[References omitted]

53. When exercising a costs discretion, as with any other discretion, it must be applied judicially with appropriate reasons: House v The King (1936) 55 CLR 499; [1936] HCA 40. The discretion as to costs must also be applied having due regard to the overriding purpose in applying procedural rules to civil proceedings in accordance with the overall dictates of justice, s 56 to s 58 of the CL Act.

54. I now turn to my consideration and determination of the costs issue.

Determination

55. When the hearing commenced on 2 December 2019, generally speaking, the issues to be litigated were relatively straightforward, despite the array of evidence. There was a factual dispute as to whether Ms Aerenga had been subjected to the harassment that she had claimed. There was also a dispute as to the extent of the damages she was entitled to receive if that underlying factual dispute was resolved in her favour. She bore the onus of proof on those matters.

56. At that stage of the pleadings and on the evidence that had been served, UGL did not seek to traduce the plaintiff’s credit, nor did it seek to allege that her claim was being maintained fraudulently. In that regard, understandably, as was its entitlement, UGL had made a forensic decision, metaphorically speaking, to keep its “powder dry” on material issues of credit: T37.11.

57. However, UGL’s preparation for trial was accompanied by observable signs that ought to have been discernible to all other affected parties, including to the legal representatives of Concept in the satellite litigation comprising the s 151Z recovery proceedings.

58. Those discernible signs ought to have included the very visible activity of the production of documents in response to a considerable number of subpoenas that had been issued seeking the production of a significant array of documents which were plainly relevant to testing the credibility and the reliability of Ms Aerenga’s proposed testimony as was foreshadowed by her legal representatives in the pleadings, in the particulars, and in the documentary evidence that had been served. This was also where all interested parties were permitted inspection and copying access to documents produced on subpoena. That access was available to the parties prior to 19 May 2020.

59. In my view, had Concept’s solicitors taken the opportunity to undertake an analytical inspection of the documents produced on subpoena they would more probably than not have formed the view that the prospect of Concept succeeding in respect of the whole of its claim for recovery of worker’s compensation payments made to or on behalf of Ms Aerenga was problematic, to say the least, because there were serious issues of credit as to Ms Aerenga’s claimed disability, as emerged from those documents in the course of the cross-examination of Ms Aerenga.

60. Those circumstances, once known, would have inevitably led to a re-evaluation of the position of any affected party.

61. Whilst there was no specific evidence called as to what subpoenaed documents if any, had been inspected by the legal representatives of Concept, I infer from the continued maintenance of the s 151Z recovery litigation that the documents were most likely not inspected, or if they were, the significance of the content of those documents was not fully appreciated.

62. If those documents had been inspected, astute and experienced litigation solicitors alert to the issues to be proven in those recovery proceedings, ought to have detected sentinel red flags that were likely to have an impact upon the prospects of their client’s success of those proceedings.

63. In such circumstances, it would have been reasonable to take steps to seek out a timely and dignified exit from the litigation rather than rejecting a settlement opportunity with the bold statement: “We fail to see any circumstances where our client’s claim for recovery does not succeed”: Annexure “D” to the Affidavit of Ms Cantle.

64. In essence, Concept’s submissions in resistance to UGL’s claim for indemnity costs is based upon a complaint that UGL had not signalled to Concept that it intended to expose flaws in the factual foundations of Ms Aerenga’s case, and therefore Concept’s case: MFI “4”, paragraphs 7 to 19.

65. In litigation circumstances where a party intends to keep its “powder dry” in order to expose what it considers to be a fraudulent claim or a flawed claim, it is entitled to make forensic or tactical decisions to keep the “powder dry” without necessarily transgressing the requirements of s 56 to s 58 of the CP Act. However, if that course fails to achieve the intended objective, it could have expensive consequences as to costs.

66. In this case, those expensive consequences were not sheeted home to UGL in that it has achieved a result whereby Concept’s claim was unsuccessful.

67. Concept’s complaint about the state of the particulars should be seen as having little substance in light of the above statements.

68. In my view, the pivotal fulcrum in this case is that where, in a case that involved serious allegations of fact that were being made by Ms Aerenga, and upon which Concept also relied, and which were disputed by UGL, the occasion arose for Concept to pause and to take serious stock and survey its position and its likely prospects of success in its litigation.

69. This was in circumstances where UGL had amassed a plethora of material which Concept’s advisors could have readily accessed and understood as revealing problems with Ms Aerenga’s case, as well as with Concept’s own case.

70. Instead, it appears that Concept took the position that it would travel in the slip-stream of Ms Aerenga’s litigation, which took what turned out to be a very bumpy road. Such are the risks of litigation.

71. The circumstances described above lead me to conclude that there has been litigation laxity on the part of Concept and that such laxity operated to needlessly and avoidably increase the costs that were then likely to be incurred by UGL for so long as Concept’s proceedings were maintained and prolonged, based upon a dubious view of merit. I consider those circumstances amount to conduct that should be characterised as disentitling in respect of the exercise of a discretion in favour of Concept on the question of costs.

72. I accept UGL’s submission that by 19 May 2020, Concept was in possession of, and had access to, all the material that was reasonably required for it to realise that there were significant factual inconsistencies in the case sought to be made by Ms Aerenga, and upon which Concept’s case was based as to a material extent. That was a circumstance which merited a serious reconsideration of the prospects of success of Concept’s satellite litigation rather than taking a dismissive view of an unattractive settlement offer.

73. The inconsistencies in question arose from within a range of documents produced on subpoena and from the investigator’s reports that Concept’s own solicitors had commissioned and obtained.

74. I accept the submission that Concept’s legal advisors were, as at 19 May 2020, and thereafter, in a reasonable position to doubt the veracity of a significant number of Ms Aerenga’s factual claims that had a material bearing on the outcome of both sets of proceedings.

75. Such doubts emerged from readily available documents produced on subpoena, some of which contradicted the basis upon which WorkCover certificates had been issued and which based the payment of workers’ compensation payments to Ms Aerenga, and upon which Concept was reliant in seeking to recover damages in these proceedings.

76. UGL’s submissions aptly state the position as follows:

1. Any basic forensic examination of the material above conducted on or before 19 May 2020 by a reasonably prudent legal practitioners acting on behalf of the Plaintiff would have revealed the significant evidentiary problems confronting Ms Aerenga in her claim against the Defendant in the Aerenga proceedings, and therefore, equally, the Plaintiff’s claim in these proceedings against the Defendant.”

   77. I accept UGL’s submission that it was open for Concept to at any time seek to interview Ms Aerenga to seek to clarify matters of apparent historical conflict and inconsistency in the factual case she was seeking to make against UGL, and upon which Concept’s case against UGL was dependent.

   78. I consider that the combination of the timing and rejection of UGL’s offer of compromise on 19 May 2020 by Concept, the laxity of Concept’s stance and the justice of those circumstances require that from 20 May 2020, UGL’s costs should be paid by Concept on the indemnity basis in addition to a liability for costs on the ordinary basis up until that date.

Orders

79. I make the following orders:

1. The plaintiff is to pay the defendant's costs of the proceedings on the ordinary basis up to and including 19 May 2020, and on an indemnity basis from 20 May 2020;

2. In lieu of the order made on 4 December 2019 concerning the costs of a mediation, those costs are to be paid equally between the plaintiff in these proceedings and Ms Jamile Aerenga, the plaintiff in the associated proceedings 2015/360589;

3. The exhibits may be returned;

4. Liberty to apply on 7 days’ notice if further or other orders are required.

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Decision last updated: 18 September 2020