Gower v Ferguson

Case [2022] QDC 114

DISTRICT COURT OF QUEENSLAND

CITATION:

Gower v Ferguson [2022] QDC 114

PARTIES:

GEORGIE GOWER

(appellant)

v
SAMANTHA FERGUSON

(respondent)

FILE NO/S:

BD2505/2021

DIVISION:

Appeal

PROCEEDING:

Application for leave to appeal pursuant to s 45 of the Magistrates Courts Act 1921 (Q)

ORIGINATING COURT:

Magistrates Court at Brisbane

DELIVERED ON:

20 May 2022

DELIVERED AT:

Cairns

HEARING DATE:

13 May 2022

JUDGES:

Smith DCJA

ORDER:

1.   The application for leave to appeal is dismissed.

2.   I will hear the parties on the question of costs.

CATCHWORDS:

COSTS- whether indemnity costs should have been awarded - where the appellant sought to discontinue the proceedings - where claim was for damages arising from motor vehicle collision - where vehicle was repaired for $833.54 - where the claim was for in excess of $5000 - where misrepresentations were made as to the true cost of repair - whether appellant should have discontinued the action - effect of offers to settle

Magistrates Courts Act 1921 (Q) s 45
Uniform Civil Procedure Rules 1999 (Q) rr 307, 515

A v Director of Family Services (1996) 132 FLR 172; 20 Fam LR 549, cited
Bucknell v Parker [2018] QDC 36, applied
Coles and Ors v Hetherton and Ors [2013] EWCA Civ 1704; [2014] 3 All ER 377; [2015] 1 WLR 160, distinguished

Colgate-Palmolive Company v Cussons Pty Ltd [1993] FCA 801; 46 FCR 225; 118 ALR 248, cited

Dare v Pulham [1982] HCA 70; 148 CLR 658, discussed
Fairfield Services Pty Ltd (in liq) v Leggett [2020] QSC 183; 5 QR 50, distinguished
Kioa v West [1985] HCA 81; (1985) 159 CLR 550, cited
Minister for Immigration v WZARH [2015] HCA 40; 256 CLR 326, cited
Powercor Australia Ltd v Thomas [2012] VSCA 87; 43 VR 220, distinguished
R v War Pensions Tribunal; ex parte Bott [1933] HCA 30; (1933) 50 CLR 228, cited
Rodriguez v Telstra [2002] FCA 30; 66 ALD 579, cited
Talacko v Talacko [2021] HCA 15; 95 ALJR 417; 389 ALR 178, cited

COUNSEL:

Mr P Sams for the appellant
Mr D Kelly for the respondent

SOLICITORS:

State Lawyers for the appellant
Ligeti Lawyers for the respondent

Introduction

  1. This an application for leave to appeal a costs decision given by the Brisbane Magistrates Court on 17 September 2021. The application is for leave to appeal under s 45 of the Magistrates Courts Act. To succeed, the appellant must show there was an important question of law or justice to be decided.

  2. In this matter, the Magistrate ordered the appellant to pay the costs of the action on the standard basis until 28 January 2021 and thereafter on an indemnity basis.

  3. In order to consider whether leave should be granted it is necessary to consider whether the appellant has reasonable prospects of success.

    Background

  4. On 21 September 2020, the appellant filed a claim and statement of claim claiming damages as a…

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Gower v Ferguson [2022] QDC 114
Case
[2022] QDC 114
Decision Date

CaseChat Overview and Summary

In the matter of Gower v Ferguson, the appellant sought damages for a motor vehicle collision. The parties disputed the true cost of repair, with the appellant claiming $5,001.06 and the respondent asserting it was $833.59. The trial was set for 28 June 2021, but the appellant filed a notice to discontinue proceedings a week prior, which the respondent did not consent to. The Magistrate ruled on the costs and ordered costs on a standard basis until 28 January 2021 and on an indemnity basis thereafter. The appellant argued that the Magistrate erred in failing to consider that damages could be for more than repair costs, that a hypothetical trial was not possible, and that the costs were disproportionate to the amount in dispute. The respondent submitted that the Magistrate correctly exercised his discretion and that the costs were reasonable.

The court was required to determine whether the Magistrate correctly exercised his discretion under the Uniform Civil Procedure Rules 1999 (Q) r 307 to award indemnity costs and whether the appellant was entitled to discontinue the proceedings without incurring indemnity costs. The court also needed to assess whether the Magistrate erred in conducting a hypothetical trial and in rejecting the contents of an independent expert report.

The court found that the Magistrate correctly exercised his discretion in awarding indemnity costs. The court noted that indemnity costs are exceptional and are only awarded for good reason. The Magistrate identified that State Lawyers acted precipitately in issuing proceedings in the matter and had enquiries been made at an earlier stage the impossibility pursuing the amounts sought would have been apparent. The court found no error in the Magistrate’s decision to conduct a hypothetical trial and rejected the appellant’s contention that the Magistrate should have given the appellant her costs after the notice of discontinuance i.e. 21 June 2021. The court found the costs to be proportionate to the amount in dispute and the nature of the litigation.

The application for leave to appeal is dismissed. The parties will be heard on the question of costs.

Orders

Orders of the court

1. The application for leave to appeal is dismissed.

2. I will hear the parties on the question of costs.

Background

Background to the litigation

In order to consider whether leave should be granted it is necessary to consider whether the appellant has reasonable prospects of success.Background On 21 September 2020, the appellant filed a claim and statement of claim claiming damages as a result of a motor vehicle collision in the sum of $5,001.06 and motor vehicle assessment fee of $484. Attached to the claim was an assessor’s report claiming repair costs to the vehicle would be $5,001.06. On 4 January 2021, a defence was lodged in effect not admitting the allegations as more information was required. On 3 February 2021, an amended defence was filed in which the defendant alleged the vehicle had been fixed by Bumper Pro Pty Ltd at a cost of $833.59 as per an invoice dated 25 August 2020. The claim by the plaintiff was said to be exorbitant. A trial was listed for 28 June 2021. The week before the trial the appellant forwarded to the court a notice to discontinue proceedings. The respondent did not consent to this. The matter was heard on 20 July 2021 and by a reserved decision the Magistrate made the orders I mentioned previously.Evidence The evidence revealed that the respondent was insured by Auto and General Insurance (“A&G”). On 12 August 2020 the collision occurred. On 18 August 2020 the vehicle was checked by Bumper Pro a repairer.[1] Also on 18th August 2020 Bumper Pro quoted the cost of repairs at $833.59 to Drive Happy Accident Management Pty Ltd trading as Statewide Auto repairs (“Drive Happy”).[2][1]Exhibit FVR 9, page 33. Affidavit of Mr Van Oudtshoorn filed 4 June 2021.[2]Exhibit FVR 9, page 34. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. Drive Happy authorised repairs to the vehicle on 19 August 2020.[3][3]Exhibit FVR 9, page 35. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. On 24 August 2020 instructions were received by National Assessing to assess the vehicle.[4] [4]Exhibit FVR 1, page 3. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. On 25 August 2020 the vehicle was repaired and Bumper Pro forwarded a tax invoice to Drive Happy for $833.59. On the same day the Plaintiff took delivery of the vehicle. I infer that it had been returned to its pre-accident state. The Plaintiff signed the receipt stating that she was happy with the repairs.[5][5]Exhibit FVR 9, page 44. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. On 26 August 2020 Statewide Auto Repairs issued a Tax Invoice claiming the repairs cost $5001.06 and that the vehicle had been with it from 14 August until 26 August 2020.[6] I consider this to be a false invoice. Statewide did not repair the vehicle; it did not have the vehicle during those times alleged; and the cost of repairs was not $5001.06. [6]Exhibit FVR 7, page 24. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. On 31 August 2020 Nationwide Assessing assessed repairs to the vehicle at $5001.06.[7] [7]Exhibit FVR 1, page 3. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. On 31 August 2020, A&G received an email from State Lawyers on behalf of the appellant demanding payment of $5,001.06 for the costs of repair and $484 for an assessment fee.[8] Also a claim was made for the cost of a hire car. That claim was settled. [8]Exhibit FVR 1, page 1. Affidavit of Mr Van Oudtshoorn filed 4 June 2021.

Evidence

Evidence Before The Court

A trial was listed for 28 June 2021. The week before the trial the appellant forwarded to the court a notice to discontinue proceedings. The respondent did not consent to this. The matter was heard on 20 July 2021 and by a reserved decision the Magistrate made the orders I mentioned previously.Evidence The evidence revealed that the respondent was insured by Auto and General Insurance (“A&G”). On 12 August 2020 the collision occurred. On 18 August 2020 the vehicle was checked by Bumper Pro a repairer.[1] Also on 18th August 2020 Bumper Pro quoted the cost of repairs at $833.59 to Drive Happy Accident Management Pty Ltd trading as Statewide Auto repairs (“Drive Happy”).[2][1]Exhibit FVR 9, page 33. Affidavit of Mr Van Oudtshoorn filed 4 June 2021.[2]Exhibit FVR 9, page 34. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. Drive Happy authorised repairs to the vehicle on 19 August 2020.[3][3]Exhibit FVR 9, page 35. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. On 24 August 2020 instructions were received by National Assessing to assess the vehicle.[4] [4]Exhibit FVR 1, page 3. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. On 25 August 2020 the vehicle was repaired and Bumper Pro forwarded a tax invoice to Drive Happy for $833.59. On the same day the Plaintiff took delivery of the vehicle. I infer that it had been returned to its pre-accident state. The Plaintiff signed the receipt stating that she was happy with the repairs.[5][5]Exhibit FVR 9, page 44. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. On 26 August 2020 Statewide Auto Repairs issued a Tax Invoice claiming the repairs cost $5001.06 and that the vehicle had been with it from 14 August until 26 August 2020.[6] I consider this to be a false invoice. Statewide did not repair the vehicle; it did not have the vehicle during those times alleged; and the cost of repairs was not $5001.06. [6]Exhibit FVR 7, page 24. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. On 31 August 2020 Nationwide Assessing assessed repairs to the vehicle at $5001.06.[7] [7]Exhibit FVR 1, page 3. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. On 31 August 2020, A&G received an email from State Lawyers on behalf of the appellant demanding payment of $5,001.06 for the costs of repair and $484 for an assessment fee.[8] Also a claim was made for the cost of a hire car. That claim was settled. [8]Exhibit FVR 1, page 1. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. On 2 September 2020, A&G sent a letter requesting documents in support of the appellant’s claim.[9] [9]Exhibit FVR 3, page 11. Affidavit of Mr Van Oudtshoorn filed 4 June 2021. A&G, at the time it was unaware of the true cost of repair, on 4 September 2020 offered to settle the claim for $2,500.[10] [10]Exhibit FVR 16, page 5. Affidavit of Mr Van Oudtshoorn filed 24 June 2021. On 7 September 2020, A&G offered to settle the claim for $3,000 which offers were repeated on 10 September 2020 and 16 September 2020.[11] [11]Exhibit FVR 16, pages 1-3. Affidavit of Mr Van Oudtshoorn filed 24 June 2021.

Decision

Reasons for decision

I disagree with this affidavit. The fact is that all material times it was represented by the appellant the cost of repair was $5,001.06 and not the true cost of repair of $833. It was specifically noted in the statement of claim and the particulars that this was a repair case.Decision of the Magistrate The Magistrate in his decision analysed the issues in the case and correctly set out the chronology of the matter. The Magistrate correctly gave the plaintiff leave to discontinue the proceeding. He correctly noted that r 307 of the UCPR provided a discretion in the court to make an order for costs the court considers appropriate. The Magistrate correctly identified that indemnity costs were exceptional and are only awarded for good reason. He referred to relevant authorities on this point. He also referred to the Calderbank offers in this case. Ultimately the Magistrate was of the view that State Lawyers acted precipitately in issuing proceedings in the matter and had enquires been made at an earlier stage the impossibility pursuing the amounts sort would have been apparent. He made no findings as to when the appellant was aware of the actual repair costs. In those circumstances, costs were ordered on the standard basis up until 28 January 2021. Thereafter the appellant litigated the matter for an unrecoverable amount and in those circumstances the Magistrate ordered costs from that date on an indemnity basis.Appellant’s submissions The appellant submits the Magistrate erred in this case. It is submitted the Magistrate made no findings about the assessment fee and erred in failing to take into account that a plaintiff is entitled to claim damages for diminution in value of the damaged property, which may be different from the costs of repairs. It is submitted that the Magistrate conducted a hypothetical trial which was impossible to do in the circumstances. It is submitted that the notice of appeal raises a number of important principles of law or justice including whether a plaintiff is entitled to pursue a claim for damages for diminution in value to damaged property; whether the Magistrate was entitled to conduct a hypothetical trial; whether that was possible; whether it was possible for the Magistrate to reject the contents of an independent expert report and whether a party who seeks to discontinue proceedings should be exposed to an indemnity costs order. The appellant points out authorities justifying the submission that a claim for diminution in value is available. It is submitted there were triable issues in this case concerning this and it is further submitted the Magistrate should not have conducted a hypothetical trial. It also submitted the quantum of costs was disproportionate to the modest sum of the money in dispute. In oral submissions the Appellant’s counsel submitted:(a)That the claim was for more than repairs and in any event the simplified procedures applied.(b)Damages can be for more than repair costs.(c)Statewide in this case subcontracted the repairs to Bumper Pro.(d)Two experts gave reports greater than the cost of repair.(e)The decision of Coles and Ors v Hetherton and Ors[18] was authority for the proposition that the scheme here was legitimate.(f)The Magistrate was not in a position to conduct a hypothetical trial. He erred in finding the amount claimed was unreasonable.(g)The Magistrate did not deal with the principle relating to the assessment of damages.(h)The Magistrate should have given the appellant her costs after the notice of discontinuance i.e. 21 June 2021.[18][2013] EWCA Civ 1704; [2014] 3 All ER 377; [2015] 1 WLR 160. Respondent’s submissions

Ratio Decidendi

Legal Principle Established

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