Di v Mm
[2006] QDC 1
•10 January 2006
DISTRICT COURT OF QUEENSLAND
CITATION:
DI v MM [2006] QDC 001
PARTIES:
DI
Plaintiff
V
MM
Defendant
FILE NO/S:
BD 1588/2004
DIVISION:
Civil
PROCEEDING:
Claim
ORIGINATING COURT:
District Court of Queensland
DELIVERED ON:
10 January 2006
DELIVERED AT:
Brisbane
HEARING DATE:
7 December 2005
JUDGE:
Alan Wilson SC, DCJ
ORDER:
That no order for the payment of interest or costs be made in the claim
CATCHWORDS:
COSTS – OFFERS TO SETTLE - DE FACTO PROCEEDINGS – wh offers to settle warranted an order for costs – meaning and effect of Property Law Act 1974, s 341 and UCPR r 360, considered
Property Law Act 1974, s 341
Uniform Civil Procedure Rules, rr 360, 361
Callinan v Borovina and Fire and All Risks Insurance Co Ltd (1977) Qd R 366
Pheeney v Doolan (No 2) (1977) 1 NSWLR 601COUNSEL:
Mr P W Hackett for the claimant
Mr R Cameron for the defendant
SOLICITORS:
Peter Daley
Thomas Solicitors
This matter concerned a dispute between a woman and a man who had formerly lived in a de facto marriage relationship, and the resolution of property issues under Part 19 of the Property Law Act 1974. Judgment was delivered on 7 December 2005. The female defendant MM was ordered to pay the male claimant DI $45,000; and it was directed that a property on a Bay island which they owned jointly be sold, and the proceeds divided equally, subject to an adjustment in MM’s favour for outgoings she had paid after the relationship ended.
DI sought interest, and costs. Interest was not claimed in the proceedings, and it is something which the rules require be specifically pleaded, with particulars of the rate, and period: UCPR, rr 150, 157. The statement of claim contains a prayer for ‘… such further or other Orders as the Court deems appropriate’[1] but that does not meet the stipulation in the Rules, which is clear, nor accord with the previous practice which held that, interest being a form of relief, a specific pleading was necessary[2].
[1] Claim and Statement of Claim filed 5 May 2004,
[2] Callinan v Borovina and Fire and All Risks Insurance Co Ltd (1977) Qd R 366, per Douglas J at 377-78; Pheeney v Doolan (No 2) (1977) 1 NSWLR 601, per Moffitt P at 605-6
Even if claimed, an award is discretionary[3] and would not, it seems to me, be attracted here. Interest is intended to assist the court ‘… to do more complete justice between the parties’[4]. While the findings I have made recognise the claimant’s contribution to the reduction of the defendant’s mortgage debt, the countervailing factors are that she has, albeit inadvertently, assisted him to save in circumstances where the evidence, while limited, suggested he had not done that before the relationship began; and, he has the benefit of an interest in an asset – the Bay island land – which, again, is the product of her better expertise with money, and investments. The relationship was a short one. The discretion which arises under Part 19, requiring a just and equitable distribution, militates against an award of interest when these factors are weighed.
[3]Supreme Court Act 1995, s 47
[4]Australian Civil Procedure, Cairns, 5th Ed, p 502
Part 19 otherwise provides that each party will ordinarily bear its own costs: s 341(1), but the court has a discretion to award them if there are ‘circumstances justifying’ that course: s 341(2). S 341(4) provides that, among such other things it may take into account at its discretion, the court ‘must consider’ certain matters including, relevantly here, offers to settle under the UCPR, Ch 9.
Following submissions on costs on 7 December 2005 the defendant’s solicitor sent me, with his opponent’s consent, copies of formal Offers to Settle and related correspondence. The bundle will be marked Exhibit 17.
Relevantly, DI made an offer under Ch 9 on 10 September 2004, in terms that he would transfer the island property to MM and relinquish all claims if she paid him $57,500; she countered with an offer on 7 February 2005 on much the same basis, but involving a payment to DI of only $39,000; and on 17 May 2005 he responded with another offer, under which (reversing his previous stance) he got the island land, and she paid him $15,000.
These formal offers were supplemented by others contained in ‘without prejudice’ correspondence. The male plaintiff’s most generous, subsequent offer was made in his solicitor’s letter 15 August 2005, restating his formal offer of 17 May. The female defendant’s most generous proposal was to increase the cash component of her Offer of 7 February 2005 from $39,000 to $40,000.
In the result, DI was awarded $45,000 plus half the value of the land, less a small adjustment in MM’s favour - in approximate terms, and assuming the land sells for about the value ascribed to it, about $56,000. On the same assumptions his best offer was, in monetary terms, about $40,000 while hers approximated $30,000, or a little less.
S 341 (4), broadly, places emphasis on three elements in the proceedings - the individual financial circumstances of the parties: ((4)(a) and (b)); their conduct of, the proceedings and their proper compliance with rules and orders of the court: ((4)(c) – (f)); and, other general discretionary matters relevant to the ‘…justice of the case’: ((4)(g)). The significant factors here are the parties’ financial circumstances, the offers to settle, and such other matters as may touch the overriding discretionary question.
An intervening question not addressed in submissions is whether UCPR r 360, which will usually require the making of an indemnity costs order in favour of a plaintiff who does better than his or her formal offer, should be construed as less compelling in these actions. Several matters indicate that was the intention of the Legislature: first, it is to be considered subject to the primary rule that, in these cases, parties will usually bear their own costs – plainly, a recognition that they have some inherent differences from ordinary civil proceedings; second, the broad discretion apparent from the terms of ss 341(2) and (4)(g); and, third, the terms of ss (4)(f) itself which directs enquiry to the fact, as well as the terms of, any offer under the rules, suggesting the mere making of offers, as opposed to their terms and whether the offeror did better at judgment, is itself a relevant factor.
That conclusion is not surprising in light of the nature of proceedings of this kind which often involve attempts to untangle the quite complex intermingling of individual resources, and the fact that formulating offers in these cases has additional elements of complexity. Recognising that, I think, the legislature required the court to look at the substance of offers and weigh them with the other factors thought to be important. That is not to say, of course, that the emphasis on a favourable costs order in r 360 (or r 361) is overridden, or subsumed; merely that more weight than might usually apply is given to the discretion, under both rules, to make some other order if the other party shows, as r 360(1) permits, that ‘… some other order for costs is appropriate in the circumstances’.
Here, the parties will end up in much the same comparative circumstances, relative to each other, after the adjustments made under my order as before they began living together. Their principal differences were the conflicting claims to absolute ownership of the Island property, and DI’s claim to a share of the increase in the value of MM’s home brought about by a boom in the real estate market, which was vigorously pursued. Neither succeeded in the first dispute, and DI did not benefit in the way he alleged (and pleaded) he should in the second; rather, his entitlement was held to be no more than a proportion of his contribution to the reduction of MM’s mortgage debt.
His later offer was, of course, in much less optimistic terms than his pleading and, as it transpires, he did rather better in the result. Nevertheless, he vigorously pursued a much greater claim at trial. The change in focus in his offers so that, under the final one, he sought absolute acquisition of the island land when, as I found, it was purchased largely through the initiative and efforts of MM, clearly became a sticking point and must go some way to explaining her decision to proceed. While her claim to that parcel also failed, that occurred principally because the justice of the case ultimately demanded a different resolution.
Other relevant factors include both parties’ personal and financial circumstance and, again, the short duration of the relationship; and also, in the particular circumstances here, the fact DI will end up with much greater savings and resources than he had when cohabitation began. These are not circumstances which point, strongly, to the view that her persistence with the claim in the face of his offers was unrealistic, or foolish, or a compelling reason to depart from the general rule under s 341(1) or visit the effects of r 360 upon her. For these reasons I do not think the case is one where anything different from the usual order is warranted, and no order for costs will be made.
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