Guru v Coles Supermarkets Australia Pty Ltd (No. 2)
[2017] NSWDC 90
•02 May 2017
District Court
New South Wales
Medium Neutral Citation: Guru v Coles Supermarkets Australia Pty Ltd (No. 2) [2017] NSWDC 90 Hearing dates: 28 April 2017 Date of orders: 02 May 2017 Decision date: 02 May 2017 Jurisdiction: Civil Before: Judge Levy SC Decision: The defendant is to pay the plaintiff's costs of the proceedings in the sum of $10,801.65.
Catchwords: COSTS – proportionate costs order in case of exaggerated damages submissions Legislation Cited: Civil Procedure Act 2005, s 98
Legal Profession Uniform Law Application Act 2014, s 61, Sch 1, cl 2
Uniform Civil Procedure Rules 2005, r 42.1Cases Cited: Guru v Coles Supermarkets Australia Pty Ltd [2016] NSWDC 249
McLaughlin v Dungowan Manly Pty Limited [2010] NSWSC 306Category: Costs Parties: Sangeeta Guru (Plaintiff)
Coles Supermarkets Australia Pty Ltd (Defendant)Representation: Counsel:
Solicitors:
Mr M Daley (Plaintiff)
Mr D Priestley SC (Defendant)
Brydens (Plaintiff)
McCabes (Defendant)
File Number(s): 2014/252930 Publication restriction: None
Judgment
Costs application
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The defendant, Coles Supermarkets Australia Pty Ltd, seeks an order for costs against the plaintiff, Sangeeta Guru, in respect of these proceedings in which the plaintiff was successful, as was determined by a judgment delivered in favour of the plaintiff on 14 December 2016: Guru v Coles Supermarkets Australia Pty Ltd [2016] NSWDC 249.
Background
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In that decision, the plaintiff obtained a verdict in her favour in the sum of $90,130.45. This was in circumstances where, on behalf of the plaintiff, the claim for damages was submitted in the sum of $1,213,812.40: MFI "3". In the primary judgment, at paragraph [5], that claim was described as exaggerated, but not exaggerated by the plaintiff herself.
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In this application for costs it is appropriate to make a comparison between the monetary claims submitted on behalf of the plaintiff, and the ultimate findings on the assessment of her damages, as the following tabulation demonstrates:
Head of damage
Plaintiff’s submission
Assessed damages
(a) Non economic loss
$139,000
$39,500
(b) Past economic loss
$78,500
$ Nil
(c) Past loss of superannuation
$13,169
$ Nil
(d) Future economic loss
$411,000
$40,000
(e) Future loss of superannuation
$57,540
$ Nil
(f) Past domestic assistance
$38,680
$7,280
(g) Future domestic assistance
$415,638
$ Nil
(h) Future out-of-pocket expenses
$40,000
$2,000
(i) Past out-of-pocket expenses
$20,285.40
$1,350.45
Total
$1,213,812.40
$90,130.45
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Amongst the matters to be considered in this costs application made by the defendant, are the amounts of the respective open offers the parties had exchanged before judgment. On 29 October 2015, the defendant made an offer of compromise in the sum of $80,000 plus costs. The plaintiff's only open offer, which was made on 9 December 2015, was in the sum of $350,000 inclusive of costs. That offer was made two days after the first day of an adjourned hearing.
Submissions of the parties
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On behalf of the plaintiff, it was submitted that as she succeeded on the issue of liability, costs should follow the event, and therefore she should be awarded the full costs of the proceedings. The plaintiff’s costs are necessarily capped in this case, pursuant to s 61 of the Legal Profession Uniform Law Application Act 2014. On an application of s 61 of that Act, and Sch 1, cl 2 to that Act, the limit of the costs that the plaintiff may actually recover in these proceedings is 20 per cent of $90,130.45, or $18,026.09.
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On behalf of the defendant, it was submitted that as the plaintiff has largely failed to secure damages to the extent that she sought, the fair order for costs should be that each party bear their own costs. In the alternative, the defendant submitted that there should be a proportionate costs order having regard to the damages assessment.
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The submission in reply on behalf of the plaintiff was that as the actual amount of her costs incurred in the proceedings were calculable as being well in excess of the capped amount, an application of the 20 per cent cap to that calculation would not bring her recoverable costs below $18,026.09, and therefore, it would be futile in this case, to make an order of the kind now sought by the defendant.
Relevant legislation and principles to be applied
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The defendant's application seeks to invoke the wide discretion the court has for determining costs: s 98(1) of the Civil Procedure Act 2005, including to determine the extent to which costs are to be paid by a party liable for costs, as provided by sub-section (1)(c) of that Act.
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The need for the exercise of that discretion arises where it appears to the court that some other costs order should be made, including as to any part of the costs that should be payable, in preference to an order that costs follow the event: UCPR r 42.1. In the primary judgment cited in this matter, at [180], this question was raised. In approaching this question, it is recognised that an order of the kind sought by the defendant should not be made lightly: McLaughlin v Dungowan Manly Pty Limited [2010] NSWSC 306.
Consideration
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Having regard to the way in which the case was fought, the defendant was required by the plaintiff to contest a case on damages which, to a very large proportion, could not have been reasonably sustained on the evidence that was served and tendered. In my view, this conclusion justifies a proportionate costs order in this case.
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That said, it must be recognised that a significant portion of the plaintiff's costs would have been taken up with the liability contest, including issues of credit, which was an issue upon which she ultimately succeeded. Therefore, I do not accept the defendant's primary submission that each party should bear their own costs.
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However, in the circumstances where the plaintiff has succeeded on liability, but did not recover damages to the extent sought, in my opinion this ought to be reflected in a proportionate costs order. In this case, the differential amount between what was submitted and what was ultimately awarded was very significant, namely, the rounded sum of $1,123,000.
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In arriving at that view, I am mindful of the cautions expressed in the authorities, as summarised and referred to in McLaughlin v Dungowan Manly Pty Limited [2010] NSWSC 306, at [14], [20] - [22]. In my view, the present case is not one where, if a proportionate costs order were to be made, it would go against the interests of justice by tending to dissuade parties from canvassing all issues which may be material to determining the case: McLaughlin v Dungowan Manly Pty Limited [2010] NSWSC 306, at [43].
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In my view, this case is in a different category to that scenario. On 2 June 2015, this matter proceeded through the court's case management system where standard orders were made which required the timely service of documents that were to be tendered. Those orders also required the timely service of schedules embodying calculations which interpreted the served evidence. In that sense, the cards were on the table, and it is therefore plain that the evidence served on behalf of the plaintiff would not reasonably support the quantum of the claim that was ultimately advanced on behalf of the plaintiff as set out in MFI "3".
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In my opinion those circumstances justify a broad-brush approach to determining what is fair as to costs in all the circumstances: McLaughlin v Dungowan Manly Pty Limited [2010] NSWSC 306, at [22] - [23].
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In undertaking that broad approach, I consider the fair order for costs in this case should be that the plaintiff’s recoverable costs from the defendant should be reduced by 40 per cent. As those costs cannot be recovered from the defendant in a sum greater than $18,026.09, I consider that the plaintiff's costs should be limited to 60 per cent of that amount, namely $10,801.65.
Orders
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The defendant is to pay the plaintiff's costs of the proceedings in the sum of $10,801.65.
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Decision last updated: 02 May 2017
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