Hendricks v El Dik (No 5)
[2016] ACTSC 302
•23 August 2016
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Hendricks v El Dik (No 5) |
Citation: | [2016] ACTSC 302 |
Hearing Date: | 23 August 2016 |
DecisionDate: | 23 August 2016 |
Before: | Mossop AsJ |
Decision: | See [22] |
Catchwords: | PRACTICE AND PROCEDURE – Application for stay of order pending appeal – Judgment in favour of plaintiff in personal injury proceedings – Disabled plaintiff – Where second defendant has offered to pay care and treatment expenses of the plaintiff pending determination of appeal – Where second defendant has already made significant payments – Balancing exercise – Timeframe for hearing and determination of the appeal – Stay granted on the condition that a further sum be paid to the plaintiff |
Legislation Cited: | Court Procedures Rules 2006 (ACT), r 5301 |
Cases Cited: | Alexander v Cambridge Credit Corporation Ltd (Receivers appointed) (1985) 2 NSWLR 685 Davey v Herbst [2011] ACTCA 27 Woolworths Ltd v Strong (No 2) [2011] NSWCA 72; (2011) 80 NSWLR 445 |
Parties: | Mohgamat Hendricks (Plaintiff) Walid El-Dik (First Defendant) Insurance Australia Limited t/as NRMA Insurance ACN 000 016 722 (Second Defendant) |
Representation: | Counsel A Black SC (Plaintiff) D Wilson SC (Defendants) |
| Solicitors Slater & Gordon (Plaintiff) Sparke Helmore (Defendants) | |
File Number: | SC 460 of 2013 |
MOSSOP AsJ:
The application
This is an application for a stay of the orders that I made on 8 July 2016. As part of that judgment I directed that judgment be entered in favour of the plaintiff in the sum of $9 million. The defendants have applied under r 5301 of the Court Procedures Rules 2006 (ACT) for a stay of that order pending appeal. They have filed a notice of appeal dated 3 August 2016 and propose that a stay be granted on the basis that the second defendant continue to pay the reasonable medical and related care and treatment expenses of the plaintiff pending the determination of that appeal.
The position of the plaintiff is that if the stay is granted, it should be on condition that an additional $2 million, beyond the amounts already paid, be paid to the plaintiff. The second defendant has, during the pendency of the proceedings, paid approximately $900,000 for care and treatment expenses for the plaintiff, and pursuant to an interim order that I made in relation to the present application, has paid an additional $100,000 lump sum to the plaintiff.
The evidence
The defendants’ evidence in support of the application is the affidavit of Mr Owen which describes an offer to continue paying treatment expenses and identifies the concern that if significant amounts are paid over to the plaintiff, and the defendants are then ultimately successful on appeal in displacing the finding of liability against them, the plaintiff may be unable to repay the amounts paid to him.
The affidavit of Mr Carrick read on behalf of the plaintiff identifies that the second defendant ultimately denied liability on 19 September 2013 and describes the care regime that the plaintiff currently has. It describes the desire of the plaintiff to obtain higher levels of care if he could afford it and the use to which he has, or proposes to put, the $100,000 that has been recently paid to him. It also identifies the fact that he wishes to buy his own home, which would need to be modified to accommodate his particular disabilities.
Submissions
Insofar as the appeal is concerned, the notice of appeal identifies a challenge to the finding of breach, a challenge to the finding of causation, and a challenge to the apportionment exercise in relation to contributory negligence. Producing perfect symmetry, the notice of contention seeks to support the judgment, but identifies errors in relation to each of those aspects of the reasoning where I found against the position contended for by the plaintiff.
The defendants identified authorities establishing the proposition that it is desirable to avoid the situation where an appeal which challenges the finding of liability is ultimately successful, but the amount the subject of the payment is unable to be recovered. Counsel for the defendants pointed to the decision of Woolworths Ltd v Strong (No 2) [2011] NSWCA 72; (2011) 80 NSWLR 445, which in turn referred to the decision in TCN Channel 9 Pty Ltd v Antoniadis (No 2) [1999] NSWCA 104; (1999) 48 NSWLR 381. That decision supports the proposition that it is desirable to stay judgments pending appeal where there is a risk that the plaintiff will be unable to repay the money without difficulty or delay if the appeal were to succeed.
The defendants also pointed to the decision of Besanko J in Lewincamp v ACP Magazines Ltd (No 3) [2008] ACTSC 81. In that case his Honour followed the decision in Alexander v Cambridge Credit Corporation Ltd (Receivers appointed) (1985) 2 NSWLR 685 (Cambridge Credit) which held that it was not necessary to show special or exceptional circumstances in order to justify the stay. That approach was held to be the correct one by Burns J in Volanne Pty Ltdv International Consulting and Business Management Pty Ltd [2015] ACTCA 25.
In contrast senior counsel for the plaintiff, while recognising the principles which apply, emphasised the personal considerations relevant to the plaintiff which point in favour of only a limited stay being granted. He further submitted that there was potential for there to be significant delays pending not only the hearing of the appeal, but also the determination of the appeal, regardless of whether the hearing was expedited.
The plaintiff contended that any stay of the orders should be only long enough so as to permit the matter to come before the Court of Appeal constituted by a single judge so that in the event that it emerges that expedition cannot be granted or, in any event, that there are likely to be longer delays than anticipated for the purposes of the hearing and determination of the appeal, then the question of the stay or extent of payment required as a condition of the stay can be reconsidered. Senior counsel for the plaintiff agreed that any order that I made should not come into effect for a period so as to permit the matter to come before the Court of Appeal before any additional amount is required to be paid to the plaintiff.
Principles to be applied
I accept that it is appropriate in the first instance to make the application for a stay to the trial judge who, although obviously having given the decision in favour of one party and not the other, has a better understanding of the particular circumstances of the case as a result of having heard it than would a judge coming new to the facts of the case. That is made clear by the decision of Miles CJ in Griffiths v Australian Postal Commission (1987) 87 FLR 139, and also by the decision of McColl J in Hussain v Haynoum Developments Pty Ltd [2014] NSWCA 173 at [67].
The test for the granting of a stay is articulated in the decision in Cambridge Credit and has been adopted in this jurisdiction in Davey v Herbst [2011] ACTCA 27 where (at [12]) Burns J summarised the principles as follows:
I take from these authorities the following principles:
(a) in order to grant a stay it is not necessary for the applicant to demonstrate special or exceptional circumstances;
(b) in order to justify the court exercising its discretion to grant a stay, the applicant must demonstrate some reason or appropriate case that warrants the exercise of the discretion;
(c) such a reason would include the applicant's prospects of success on the appeal, and the likelihood of the applicant suffering irremediable prejudice if the stay is not granted;
(d) in determining whether to grant a stay, the competing right of the parties and the balance of convenience must be weighed.
Consideration
In the present case, as I have indicated, the second defendant already has a significant exposure to the plaintiff as a result of its previous payments of approximately $1 million. I accept there is a risk that if a substantial additional payment is required to be made that there may be at least difficulties in recovering that amount if the defendant is completely successful on appeal. However, it is not a case where the amount is likely to disappear. Instead it is more likely to be a case where the plaintiff has used the amount pending appeal to cover either his expenses or capital assets such as the purchase and modification of a house.
So far as the plaintiff's personal circumstances are concerned, they are ones where he clearly needs additional money, one way or another, in order to accommodate his basic needs as well as to achieve some form of autonomy by owning his own house. I accept that the defendants’ offer would accommodate the former, but not the latter of those needs.
In terms of assessing the prospects of the appeal, it is not appropriate to attempt anything more than the most bare-bones assessment. I accept that in relation to questions of breach and causation the defendants have an arguable case on appeal. It appears to me that the stronger of the arguments when one looks at the appeal as a whole is in relation to contributory negligence, because inevitably that is a matter upon which reasonable minds might differ where the overall characterisation of, and emphasis upon, a number of different factors can lead to different conclusions.
At the trial the contention put in relation to contributory negligence was that if breach and causation were established, then there should be an 80% reduction in the award. On $12 million that would result in an overall award to the plaintiff of $2.4 million. If the reduction was a reduction of 75% rather than 80%, then the award would be $3 million. Having regard to the $1 million already paid, that would require a further payment of between $1.4 and $2 million by the second defendant.
In terms of when the appeal is likely to be heard, it is likely that the appeal will be listed either in November 2016 or February 2017. That may be affected by whether or not expedition is granted and the view that a single judge takes about the listing of the matter. As a consequence, assuming that the Court of Appeal delay in delivering its decision is no more than three months, the likely time frame for the delivery of the decision, assuming that it was heard in February 2017, would be May 2017; although that rule-of-thumb estimate may prove to be inaccurate.
Ultimately, the question of a stay comes down to a balancing of the following factors:
(a)the defendants have an arguable case on appeal;
(b)the plaintiff has significant needs arising from the accident; and
(c)there exists a risk of at least difficulties in recovering payments made to the plaintiff pending the determination of the appeal.
A decision must be made in the light of the two competing alternative scenarios for meeting some or all of the plaintiff's needs pending the determination of the appeal.
In summary, the various factors as I see them are that the plaintiff has significant hardship as a result of being out of funds as a result of the non‑payment of the judgment. Some of that hardship will be alleviated by the defendants’ proposal, however, the defendants’ proposal does not allow the plaintiff to achieve the autonomy or independence that might be possible as a result of at least being able to take steps towards obtaining and modifying his own home.
There is a risk, if the judgment is overturned completely on appeal, of difficulties in recovering the amounts from the plaintiff. However, it appears to me to be more likely that if the appeal is successful it will be by way of an adjustment of the level of contributory negligence. In those circumstances, it appears to me that the balancing exercise leads to a result which indicates that a further substantial sum should be paid to the plaintiff as a condition of the grant of a stay of the judgment.
In my view, having regard to the fact that a 75% reduction by reason of contributory negligence would still require a payment to the plaintiff of $3 million and that the second defendant, in round terms, has already paid $1 million, it is appropriate to grant a stay, but on the condition that the second defendant pay to the plaintiff an additional $2 million beyond that which has already been paid. That puts the defendants in a position where they are at their almost best case scenario on appeal in terms of contributory negligence, but obviously is not as favourable to them as if they were to succeed on breach and causation.
Orders
The orders of the Court are:
1. The judgment given on 8 July 2016 is stayed pending determination of the defendants’ appeal dated 3 August 2016 on the condition that the second defendant pay to the plaintiff within 28 days from the date this order comes into effect the further sum of $2 million.
2. That order (1) is stayed until the end of the day upon which the proceedings are before the Court of Appeal constituted by a single judge or for a period of six weeks from today, whichever is the lesser period.
3. Costs of the application are costs in the cause.
4. The proceedings are listed before the Registrar on 25 August 2016 at 2.30 pm.
| I certify that the preceding twenty-two [22] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Associate Justice Mossop. Associate: Date: 14 October 2016 |
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