David Evan Shepherd v ANZ Staff Superannuation (Australia) Pty Ltd [No 2]
[2017] VCC 696
•1 June 2017
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMON LAW DIVISION | Revised (Not) Restricted Suitable for Publication |
SERIOUS INJURY LIST
Case No. CI-16-00204
| DAVID EVAN SHEPHERD | Plaintiff |
| v | |
| ANZ STAFF SUPERANNUATION (AUSTRALIA) PTY LIMITED (ACN 006 680 664) | Defendant |
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JUDGE: | HER HONOUR JUDGE TSALAMANDRIS | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | On the papers | |
DATE OF JUDGMENT: | 1 June 2017 | |
CASE MAY BE CITED AS: | David Evan Shepherd v ANZ Staff Superannuation (Australia) Pty Ltd [No 2] | |
MEDIUM NEUTRAL CITATION: | [2017] VCC 696 | |
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Subject: COSTS
Catchwords: Discretion – whether to depart from normal rule that successful party entitled to costs – plaintiff successful in substantive claim – whether apportionment of costs appropriate
Legislation Cited: County Court Act 1958 (Vic); Trade Practices Act 1974 (Cth)
Cases Cited:Ritter v Godfrey [1920] 2 KB 47; Oshlack v Richmond River Council (1998) 193 CLR Australian Trade Commission v Disktravel [2000] FCA 62; Major Engineering Pty Ltd v Helios Electroheat Pty Ltd (No 2) [2006] VSCA 114; Spotless Group Limited v Premier Building and Consulting Pty Ltd and Northern Suburban Properties Pty Ltd [2008] VSCA 115; Chan v Chen [2009] VSCA 233 ; Cretazzi v Lombardi (1975) 13 SASR 4;Hughes v Western Australian Cricket Association (Inc.) & Ors (1986) ATPR 40-748; McFadzean and Others v Construction, Forestry, Mining and Energy Union and Others [2007] VSCA 289
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr D Kelsey-Sugg | Maurice Blackburn Lawyers |
| For the Defendant | Mr C Hanson | Lander & Rogers |
HER HONOUR:
Introduction
1 On 15 May 2017, I delivered judgment in this proceeding in favour of the plaintiff and proposed the following order:
“1. The determination of the defendant, made on 26 June 2013, to reject the plaintiff’s claim for a total permanent disablement benefit under the ANZ Australian Staff Superannuation scheme is void and of no effect.”
2 As time did not allow for me to hear from the parties as to the question of costs, the matter was adjourned until 23 May 2017, at which time I heard oral submissions from both parties as to what each considered to be the appropriate cost orders in this matter (“the costs application”).
3 The plaintiff seeks its costs of the proceeding on a standard basis. The defendant seeks that there be no order as to costs, or in the alternative, that each party bear its own costs up to and including the first day of the hearing, and that the plaintiff then receive 50 per cent of its costs each day thereafter.
The Defendant’s submissions
4 The defendant acknowledged that costs normally follow the event, but submitted that the circumstances of this proceeding, in particular, the manner in which it was run and prepared, are such that I should depart from the normal course of events and exercise my discretion under s78A of the County Court Act 1958.
5 In support, the defendant referred me to the plaintiff’s Statement of Claim, dated 21 January 2016 and, in particular, to the prayer for relief set out therein, in which the plaintiff sought the following:
“A. A Declaration that the decision of the Defendant referred to in paragraph 9 above was void and of no effect.
B. A Declaration that the Plaintiff is entitled to a total and permanent disablement benefit under the Deed and Rules.
C. An order that the Defendant pay to the Plaintiff the total and permanent disablement benefit under the Deed and Rules.
D. Alternatively, damages.
E. Interest pursuant to statute.
F. Costs.
G. Such further or other order as the Court deems fit.”
6 The defendant stated that until the first day of the hearing on 10 February 2017, the plaintiff’s case had proceeded on the basis that the Court should substitute its decision for that of the trustees, in determining whether or not the plaintiff was entitled to a Total and Permanent Disablement Benefit (“TPD”) under the Deed, and that, if the Court was so satisfied, an order should be made requiring the defendant to pay such benefit under the Deed.
7 In support of this claim, the plaintiff served an Offer of Compromise on the defendant on 17 November 2016, in which the plaintiff sought to resolve his claim in the amount of $420,000 “all inclusive”.
8 The defendant submitted that the plaintiff did not abandon this course of action until the first day of the hearing, at which time the plaintiff informed the Court that it sought relief pursuant only to paragraph (a). That is, the plaintiff sought a declaration that the decision of the defendant was void and of no effect and said that, if the Court were satisfied declaratory relief was required, the appropriate course of action would be to remit the matter to the defendant to re-determine the claim.
9 The defendant submitted that in circumstances in which the plaintiff had abandoned the primary remedy it had sought on the first day of the hearing, the Court should not grant the plaintiff any of its costs, or at least none of its costs up until that day.
10 In addition, the defendant submitted that notwithstanding the plaintiff ultimately succeeded in the substantive matter, when looking at paragraph 13 of the Statement of Claim, the plaintiff was largely unsuccessful in the matters pleaded. In particular, it was submitted that the plaintiff failed on paragraphs (a), (b), and (d) to (i). While it had succeeded on paragraph (j), it was not on the basis as pleaded in the Particulars. In relation to paragraph (k), it also succeeded, but only part of the matters pleaded.
11 As such, when considering what is an appropriate cost order, the defendant submitted that I should have regard to the fact that the plaintiff succeeded, at best, in only three of the eleven Particulars outlined in paragraph 13.
12 The defendant also referred me to its letter to the plaintiff’s solicitors dated 2 July 2015, in which the plaintiff’s application for a TPD benefit was rejected, and in which the plaintiff was informed of his right to have the decision reconsidered by the defendant. The defendant submitted that, had the plaintiff elected to have the decision reconsidered by the defendant, it might potentially have avoided the need to issue proceedings.
13 In the event that I was prepared to make a costs order from the day the trial commenced, the defendant further submitted that I should take into account the extent to which the majority of the second morning of the hearing was occupied with the plaintiff’s submissions that I rule on the grounds upon which the plaintiff “left service”. At the end of those submissions, the plaintiff indicated that he did not require any such ruling, as it could be dealt with in my judgment.
The Plaintiff’s submissions
14 The plaintiff submitted that the costs of the proceeding should be paid on a standard basis in accordance with the ordinary rule that costs follow the event.
15 In response to the defendant’s submissions, the plaintiff submitted that it had approached the proceedings in a conventional manner and noted that the pleadings were drawn; they were drawn with imperfect information and materials that were incomplete. In the circumstances, the plaintiff submitted that it was appropriate for the plaintiff to cover himself by including a number of pleadings, and that such pleadings were refined as the litigation and trial progressed.
16 The plaintiff noted that relief was ultimately granted pursuant to paragraph (a) of the Statement of Claim, and submitted that, in such circumstances, the plaintiff should not be penalised for having kept his remedy options open until the first day of trial.
17 The plaintiff further submitted that the defendant had overlooked the reasons for which the matter proceeded to trial – that the defendant had misconstrued the Deed that it did not accord the plaintiff procedural fairness, and that it failed to make adequate enquiries. In this case, each matter would have been, on its own, sufficient to set aside the defendant’s decision. In circumstances in which the plaintiff’s TPD claim had been twice rejected by the defendant, the plaintiff submitted that it was reasonable to have issued court proceedings without seeking a further review.
Relevant principles
18 Counsel for both parties provided me with a number of authorities relevant to the application before me. While I have considered them all, I will only refer to those I deem applicable to the determination of costs in this matter.
19 Section 78A of the County Court Act 1958 provides that the costs of and incidental to all proceedings are in the discretion of the Court, and that the Court may determine by whom, and to what extent, the costs are to be paid.
20 Ordinarily, costs follow the event, and a successful party should recover its costs, absent disqualifying conduct or special circumstances, even where it has not succeeded on all heads of claim.[1]
[1]Ritter v Godfrey [1920] 2 KB 47; Oshlack v Richmond River Council (1998) 193 CLR 72, 97-8; Australian Trade Commission v Disktravel [2000] FCA 62 at [3]
21 In exercising its discretion, the Court is permitted to examine the realities of the case and will attempt to do “substantial justice” as between the parties on the matters of costs.[2]
[2]Spotless Group Limited v Premier Building and Consulting Pty Ltd and Northern Suburban Properties Pty Ltd [2008] VSCA 115 ,[14] Chan v Chen [2009] VSCA 233, [10]
22 In circumstances in which a particular matter involves a number of issues on which the parties have had mixed success, a Court may take into consideration the success, or lack thereof, of the individual parties on an issues basis. If a costs order is then subsequently made, the successful party may only receive a proportion of its costs, and not the full amount.[3]
[3]Spotless Group Limited v Premier Building and Consulting Pty Ltd and Northern Suburban Properties Pty Ltd (supra), Australian Trade Commission v Disktravel (supra)
23 When fixing costs in a claim in which the parties have achieved mixed success, a court can take into account any complications it considers will arise as a result of the taxation of costs when considering the overall interests of justice.[4]
[4]Chan v Chen [2009] VSCA 233, [4]
24 Where the Court makes an order apportioning costs, it does so as “a matter of impression and evaluation”[5] rather than with arithmetical precision, having considered the importance of the matters upon which the parties have been successful or unsuccessful, the time occupied, and the ambit of the submissions made, as well as any other relevant matters.
[5]Major Engineering Pty Ltd v Helios Electroheat Pty Ltd (No 2) [2006] VSCA 114, [5]
25 In assessing whether apportionment of costs is necessary, I was reminded of the comments of Jacobs J in Cretazzi v Lombardi:[6]
“But trials occur daily in which the party, who in the end is wholly or substantially successful, nevertheless fails along the way on particular issues of fact or law. The ultimate ends of justice may not be served if a party is dissuaded by the risk of costs from canvassing all issues, however doubtful, which might be material to the decisions of the case. There are, of course, many factors affecting the exercise of the discretion as to costs in each case, including in particular, the severability of the issues, and no two cases are alike. I wish merely to lend no encouragement to any suggestion that a party against whom the judgment goes ought nevertheless to anticipate a favourable exercise of the judicial discretion as to costs in respect of issues upon which he may have succeeded, based merely upon his success in those particular issues.”[7]
[6](1975) 13 SASR 4
[7](Supra) at 15
26 The defendant referred me to two decisions in support of its submissions. The first authority was a decision of Toohey J in Hughes v Western Australian Cricket Association (Inc.) & Ors[8], which dealt with a number of proceedings brought by the applicant, a professional cricketer. In summary, the first proceeding involved the applicant successfully obtaining an interlocutory injunction against the respondent. In the second proceeding, the applicant was successful in obtaining declaratory relief against the respondents after alleging that their conduct constituted a contract, arrangement, or understanding which contained an exclusionary provision contrary to the Trade Practices Act 1974 and that it was likely to substantially lessen competition. In a further proceeding, the applicant sought a permanent injunction against the respondents on terms substantially similar to those sought in the interlocutory injunction. However, the permanent injunction was not granted. When dealing with the question of costs, the respondents submitted that each party should bear its own costs of the proceedings, as the applicant had failed on more issues than it had succeeded, that much of the hearing had been taken up with issues on which the applicant had failed and that, in all the circumstances, it was appropriate not merely to deprive the applicant of some proportion of his costs, but to award costs to the respondents of those issues on which they had succeeded.
[8](1986) ATPR 40-748
27 In considering the question of apportionment of costs, Toohey J, stated that it is relevant, but not conclusive, to consider how much of the hearing was taken up with evidence and submissions relating to issues on which the applicant had failed. Toohey J ultimately awarded the applicant 75 per cent of his own costs as he had failed:
“… on some issues in circumstances, where not only should he not have the costs of those issues, but there should be some compensation to the respondents for the time taken in meeting those issues both prior to and at the hearing.”
28 The second authority was the decision in McFadzean & Ors v Construction, Forestry, Mining and Energy Union & Ors[9]. In this case, a group of protestors sued the Construction, Forestry, Mining and Energy Union (“CFMEU”), a CFMEU official, and a group of picketers claiming damages, including exemplary damages, for false imprisonment, assault, battery, public nuisance, and intentional infliction of emotional distress. The trial judge awarded damages to two of the plaintiffs for assault, and to five of them for intentional infliction of emotional distress. He otherwise dismissed the plaintiff’s claims and ordered them to pay 40 per cent of the defendants’ costs, apportioning individual liability for the costs between the parties.
[9][2007] VSCA 289
29 On appeal, The Court of Appeal held that the trial Judge’s award for costs was fair and just in all of the circumstances. The success of the appellants on appeal on certain discrete issues did not alter the outcome with respect to either of the principal causes of action.
Does this matter merit an alteration to the ordinary cost rule, or an apportionment of costs
30 In applying the principles set out above, I am not satisfied that the circumstances of this case warrant any departure from the ordinary rule that costs follow the event. While I accept the plaintiff may not have succeeded on all of the pleadings set out in paragraph 13 of its Statement of Claim, he ultimately succeeded in challenging the validity of the defendant’s decision on three different grounds.
31 I am also satisfied that the plaintiff was justified in issuing proceedings without first seeking a reconsideration of the defendant’s decision. Given the manner in which the case was defended at trial, it is apparent that any further reconsideration would simply have expanded the volume of relevant documents and further delayed the matter.
32 Although the plaintiff had primarily sought a substitution of the defendant’s decision until the first day of the trial, it had always sought, in the alternative, a declaration that the defendant’s decision was null and void. Both prayers for relief were founded on similar pleadings, and I am not satisfied that the plaintiff’s late concession on his primary ground should disentitle him to his costs.
33 I am also of the opinion that counsel did not waste any substantive time on the second day of the hearing, in addressing me as to the grounds upon which the plaintiff left service. This was an issue that needed to be addressed at some point throughout the course of the hearing, as was conceded by the defendant on the second day of the hearing when he stated, “it’s a point we’re going to have to deal with anyway so no time’s wasted”.[10]
[10]Transcript 103, Lines 13-14
34 In the event that I was to award the defendant pay the plaintiff’s costs, the defendant agreed that it was appropriate for me to certify plaintiff’s counsel at $3,300 per day, for two and a half days. However, the defendant submitted that a certification order for three and a half days of trial preparation, together with four hours for conferences and five hours for preparing written submissions, was a matter that should be left to the specialised jurisdiction of the Costs Court for consideration. In circumstances in which I asked the parties to prepare written closing submissions from which I was assisted, I consider it appropriate to certify five hours for the preparation of such submissions.
35 However, as to counsels’ preparation and conferences fees, I am of the opinion that such fees are most appropriately considered by the Costs Court.
36 In view of the above, I will now make the following orders:
1.The determination of the defendant, made on 26 June 2013, to reject the plaintiff’s claim for a TPD under the ANZ Australian Staff Superannuation scheme is void and of no effect.
2. The question as to whether or not the plaintiff is entitled to a TPD pursuant to the ANZ Australian Staff Superannuation scheme is to be remitted to the defendant for determination in accordance with the Trust Deed and the reasons for judgment dated 15 May 2017.
3The defendant is to pay the plaintiff’s costs of the proceedings, including reserve costs on a standard basis to be agreed or, failing agreement, to be determined by the Costs Court.
4.The costs referred to in paragraph 4 of the Order of Judicial Registrar Gurry, dated 8 February 2017, are to be offset against the costs referred to in paragraph 2 above.
5.Certify:
a.Fee upon brief for counsel for the plaintiff in the sum of $3,300 for each of the 2.5 days;
b.Counsel’s fees for drafting closing submissions for 5 hours at $330 per hour;
c.Fee for Counsel to hear Judgment at $550.
6. The proceedings be otherwise dismissed.
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