Hooker v Allied Pumps Pty Ltd

[2016] WADC 44

JURISDICTION     :   DISTRICT COURT OF WESTERN AUSTRALIA

IN CIVIL

LOCATION:   PERTH

CITATION:   HOOKER -v- ALLIED PUMPS PTY LTD [2016] WADC 44

CORAM:   DEPUTY REGISTRAR HEWITT

HEARD:   23 MARCH 2016

DELIVERED          :   14 APRIL 2016

FILE NO/S:   CIV 1141 of 2014

BETWEEN:   MICHAEL JAMES HOOKER

Plaintiff

AND

ALLIED PUMPS PTY LTD
First Defendant

DANIEL SLACK
Second Defendant

ANDREW STARCEVICH (FORMERLY EDWARDS)
Third Defendant

Catchwords:

Practice and procedure - Second and third defendants' application for summary judgment - Limitation Act 2005 - Turns on its own facts

Legislation:

Fatal Accidents Act 1959 s 6, s 7

Result:

Summary judgment given

Representation:

Counsel:

Plaintiff:     Mr M A Tedeschi

First Defendant             :     Not applicable

Second Defendant         :     Ms S F Wise

Third Defendant           :     Ms S F Wise

Solicitors:

Plaintiff:     Slater & Gordon

First Defendant             :     SRB Legal

Second Defendant         :     SRB Legal

Third Defendant           :     SRB Legal

Case(s) referred to in judgment(s):

Rottnest Island Authority v Nagle (Unreported, WASCA, Library No 950214, 11 April 1995)

1. DEPUTY REGISTRAR HEWITT:  This action was commenced by a writ filed on 11 April 2014 in which the plaintiff claimed damages for personal injuries allegedly sustained in the course of his employment as a result of negligent acts by employees for whom the plaintiff was vicariously liable.  The events which gave rise to the claim occurred on 12 March 2012.  By orders made on 19 November 2015 the plaintiff was granted leave to join Daniel Slack as a second defendant and Andrew Edwards as a third defendant.  An amended writ adding the second and third defendants was filed on 2 December.  There is no evidence before me as to when that was served but an appearance on behalf of the second and third defendants was filed on 17 December 2015 from which I draw, as a working hypothesis that the writ was probably served at about the time it was issued.

2. The second and third defendants have now brought a summary judgment application seeking to have the action against them dismissed.  The application may be out of time and the court may need to grant leave if the application is to be entertained.

3. There is some debate between the parties as to whether or not the application is out of time since it was filed on 18 January and if the provisions of O 3 r 3 are applicable the period between 24 December and 15 January is not to be taken into account and as a consequence the application was filed within the 21 days prescribed by O 14.

4. That proposition appears to me to be supported by the case of Rottnest Island Authority v Nagle (Unreported, WASCA, Library No 950214, 11 April 1995). I therefore conclude that the application for summary judgment was brought within time. If I am wrong in that conclusion I think that time should be extended where the materials before the court clearly indicate that the case pursued by a plaintiff is hopeless. I see little point in burdening the parties or the court with a futile action. As to whether or not the action is futile I now turn to my analysis of the materials. The thrust of the applicant's case is that the actions pursued against the second and third defendants are statute barred. The applicant relies on the combination of s 6, s 14 and s 55 of the Limitation Act 2005.  In summary those sections in combination provide:

   (a)an action for damages relating to a personal injury to a person cannot be commenced if three years have elapsed since the cause of action accrued; and

   (b)the cause of action for damages relating to a personal injury to a person accrues when the only or earlier of such of the following events as are applicable occurs –

   (i)the person becomes aware that he or she is sustained a not insignificant personal injury;

   (ii)the clinical sign or other manifestation of personal injury consistent with the person having sustained a not insignificant personal injury.

5. As I have earlier noted the plaintiff's injury was sustained on 12 March 2012. On 20 March 2012 the plaintiff made a claim for workers' compensation in relation to the injuries. There followed a succession of medical certificates by a variety of doctors which to 31 August 2012 totalled 15 separate medical certificates. A number of medical reports which have been produced indicate that there was intervention to assist the plaintiff in the form of a C5 nerve root injection. Subsequent to that injection there was numbness involving the majority of his arm. MRIs were ordered at about the time of the nerve root sleeve injection. Additionally the plaintiff was in receipt of a substantial amount of medication over the period covered by the various certificates and was also in receipt of physiotherapy. By 1 June 2012 the doctors had recommended that his hours of work should be restricted to four hours a day and although from time to time those hours were increased or reduced that in effect remained in place for the remainder of 2012. Given that substantial history it seems to me that the provisions of s 55 of the Limitation Act have been satisfied.  In the circumstances the plaintiff must have been aware that he had sustained a not insignificant personal injury and accordingly the cause of action although accruing after the date of accident was nonetheless clearly established by about the middle of 2012.  The relevance of that conclusion relates back to the date upon which the second and third defendants were joined in the action.  Nicety of calculation is not required.  The second and third defendants were joined when the amended writ was filed alternatively when it was served depending on one's view but in any event in December 2015.  That is a date substantially in excess of the three‑year limitation and I conclude that on the face of it the second and third defendants were joined to the action at a time when a limitation defence had accrued.

6. That brings into focus an issue which has been raised by the plaintiff in opposition.  That proposition is contained in par 15 of the summary of argument which is in the following terms:

   The Indorsement of Claim and the Statement of Claim were widely worded and encompass the liability of both Daniel Slack and Andrew Starcevich (formerly Edwards) and it was not necessary to name them specifically.  The Plaintiff could have proceeded to a hearing without having to amend his pleading and make the allegations set out in the amended statement of claim in paragraphs 5, 6, 7, 8, 10 – 13, 14, 18, 19, 20, 21, 22, 23, 24, (incorrectly numbered 14, 15, 16, 17, 18, 19, 20 and 21): Darryl Charles Harris and Shaynee Maree Harris, the children of the late Darryl Leedham Cameron suing by their next friend Vanessa Harris v State of Western Australia [2003] WADC 39 (25 February 2003) at [21] – [24] and [41] – [44].

7. The case was an action relying on the Fatal Accidents Act 1959 which provided in s 6 and s 7:

   6Every action brought under this Act shall be for the benefit of the relatives of the person whose death has been caused in any manner referred to in section 4.

   7No more than one action lies under this Act for and in respect of the same matter of complaint.

8. The proposition which was advanced in the submission is that although the second and third defendants were not named as defendants on the writ nor was any remedy sought against either of them nonetheless the action against them should be regarded as having being commenced on the date the writ was filed.

9. I am unable to accept this argument and the position in this action is utterly different to that relied upon in the submission because of the provisions in the Fatal Accidents Act which provide for one action on behalf of all claimants.  It is perfectly true that an action based on the principles of vicarious liability does not require the employees to be either named or defendants to the writ although both are perfectly permissible.  In the present case I am completely unable to see why issuing a writ naming Allied Pumps Pty Ltd as defendant, based on the alleged negligence of the second and third defendants, should have the effect that time under the Limitation Act would not run in favour of the second and third defendants and the action against them should be deemed to have been commenced when the writ was filed.  Although various authorities were referred to in argument none of them to my mind establishes that proposition as a sound proposition of law.

10. I take the view that the addition of the second and third defendants is not a mere technicality which fleshes out the original writ.  The second and third defendants may potentially either together or separately have a judgment entered against them.  It is possible that the first defendant may have the action against it dismissed and such judgment as is granted is against the second and third defendants or one or the other of them.

11. Whilst the joinder of the defendants at an earlier stage might have been a perfectly sound step to undertake, and perfectly permissible if the plaintiff chose to go down that path I am unable to see any facts or circumstances in this case which would rob those defendants of their own entitlement to a limitation defence.  In fact when one looks at the wording of the Limitation Act it would suggest that the order joining the second and third defendants was flawed although of course the judicial officer making that order was not fully informed of the facts and could not properly form an opinion as to exactly when the cause of action arose.  The Act is quite clear an action for damages relating to personal injury to a person cannot be commenced if three years have elapsed since the cause of action accrued (subject to the provisions of pt 3 of the Act which are not relevant here).  My findings are the cause of action accrued prior to December 2012 and the joinder of the second and third defendants was in the context of this action the commencement of an action for damages against each of them and thus impermissible under the provisions of the Act.

12. It follows that I am of the view that the second and third defendants should be granted a summary judgment dismissing the plaintiff's action against them.  As I have earlier stated I do not believe that any extension of time is necessary to entertain the application but if I am wrong on that score and then I would extend the time to allow the application to be heard since I am of the view there is simply no prospect of the plaintiff succeeding in his action against these additional defendants.

JURISDICTION     :   DISTRICT COURT OF WESTERN AUSTRALIA

IN CIVIL

LOCATION:   PERTH

CITATION: HOOKER -v- ALLIED PUMPS PTY LTD [2016] WADC 44 (S)

CORAM:   McCANN DCJ

HEARD:   30 NOVEMBER 2018

DELIVERED          :   7 DECEMBER 2018

FILE NO/S:   CIV 1141 of 2014

BETWEEN:   MICHAEL JAMES HOOKER

Plaintiff

AND

ALLIED PUMPS PTY LTD

Defendant

Catchwords:

Costs - Calderbank offer - Plaintiff's application for indemnity costs - Alternatively, plaintiff's application for special costs orders - Turns on own facts

Legislation:

Legal Profession (Supreme Court) (Contentious Business) Determination 2016

Result:

Application for indemnity costs dismissed
Special orders made as to costs

Representation:

Counsel:

Plaintiff	:	Mr M A Tedeschi
Defendant	:	Mr D Clyne

Solicitors:

Plaintiff	:	Slater & Gordon
Defendant	:	SRB Legal

Case(s) referred to in decision(s):

Calderbank v Calderbank [1976] Fam 93

Ford Motor Company of Australia Ltd v Lo Presti [2009] WASCA 115

Hooker v Allied Pumps Pty Ltd [No 2] [2018] WADC 129

Owston Nominees No 2 Pty Ltd v Clambake Pty Ltd [2011] WASCA 76(S)

McCANN DCJ:

1. On 12 October 2018 I handed down my substantive decision in this matter and awarded judgment to the plaintiff in the sum of $1,976,364.40 (Hooker v Allied Pumps Pty Ltd [No 2] [2018] WADC 129).

2. I ordered that the defendant pay the plaintiff's costs of the action, including reserved costs, to be taxed if not agreed and made programming orders for the bringing of any application for an indemnity costs or special costs order.

3. By application filed on 26 October 2018, the plaintiff sought the following orders:

   1.The Plaintiff's costs of the action, payable by the Defendant, be payable on a party/party basis until 17 November 2016 and on an indemnity basis thereafter, save to the extent that they are of an unreasonable amount or have been unreasonably incurred.

   2.The taxing officer, in taxing the bill of costs of the Plaintiff, do make reasonable allowance without regard to the limits imposed by the relevant cost's (sic) determinations.

   3.Alternatively, to paragraphs 1 and 2, the taxing officer, in taxing the bill of costs of the Plaintiff, do make reasonable allowance for the following items without regard to the limits imposed by the relevant Costs Determinations in relation to:

   (a)statement of claim and Substituted Minute of statement of claim 6 March 2018 (scale item 1(c));

   (b)Giving discovery of documents (scale item 7(b));

   (c)preparation of schedule of damages (scale item 16(b));

   (d)preparation of case for trial (scale item 17);

   (e)fee on brief, i.e. first day of trial and increasing preparation from 3.5 days to 10 days (scale item 20(a));

   4.The taxing officer be directed to make reasonable allowance for:

   (a)preparation for and attendance at pre‑trial conferences and mediation conferences by counsel in addition to allowances for the instructing legal practitioner (scale item 24(a), (c) & (d));

   (b)conferences between Counsel and own instructing legal practitioner (scale item 24(e));

   (c)Advice on Evidence (scale item 16(c));

   (d)counsel's costs of further preparation and conferences during trial (on non‑sitting days) including the preparation of closing submissions (scale item 20(g));

   (e)Instructing Legal Practitioner attending Trial (scale item 20(e));

   (f)Cost of obtaining Transcript of Trial.

4. At the hearing the plaintiff abandoned pars 3(a), (b) and 4(a), (b) and (d) on the basis that the relevant items were covered by other items.

5. The defendant opposed orders in terms of pars 1 and 2, and conceded orders in terms of pars 3(c) and (e) and 4(f).

The application for indemnity costs

1. The plaintiff seeks an order for indemnity costs on the ground that he made a settlement offer pursuant to the principles set out in Calderbank v Calderbank [1976] Fam 93 which was more favourable to the defendant than the judgment. The facts were as follows:

   (i)An informal settlement conference took place between the parties at the offices of Slater & Gordon on 7 September 2015.

   (ii)A formal mediation conference took place on 19 November 2015.

   (iii)On 7 November 2016, Slater & Gordon faxed a letter containing a Calderbank offer to the defendant's solicitors in the sum of $1,384,800 plus reimbursement to the defendant's insurer in the sum of $304,012.07.  In other words, the offer was $1,688,812.  The text of the letter was as follows:

I confirm we are instructed to make the following Calderbank offer of settlement:
1.	Past Loss of Earnings including superannuation and interest	$120,000
2.	Future loss of Earnings	$700,000
3.	Future loss of superannuation	$100,000
4.	Future loss of net investment returns superannuation	$10,000
5.	Past medical expenses	$154,800
6.	Future treatment expenses	$120,000
7.	Past and future gratuitous services	$80,000
8.	General damages	$100,000
Total	$1,384.800

Plus a reimbursement to Zurich Insurance in the sum of $304,012.07 (or total as at the date of settlement) plus a contribution towards legal costs and disbursements.

The offer is made in accordance with the principles in Calderbank v Calderbank [1976] FAM 93. Consistent with this case, if the offer is not accepted by the Defendant and should the Defendant, upon determination of the action, not obtain orders of the Court more favourable than the offer, then in addition to any orders made as to the costs of the action incurred before it received the offer (or a reasonable time after), the Plaintiff may use this letter and the offer in an Application for orders that the Defendant pay all of the Plaintiff's costs of the action incurred after it received the reasonable offer, or a reasonable time after, taxed on a solicitor-own client basis.

(iv)On 17 November 2016, the defendant's solicitors wrote to Slater & Gordon advising them that the settlement offer was rejected.  There was no counter offer and no reasons were given.

(v)Another informal conference took place at the offices of Slater & Gordon on 2 March 2017.

1. According to the affidavit of Ms Irena Ferraro (who had the conduct of these proceedings on behalf of the plaintiff), a very large amount of work was done in preparation of the matter for trial.  Details are set out in pars 10, 11, 12, 14, 15, 16 and 17 of her affidavit.  She deposed that 'significantly in excess of 120 hours was completed with respect to getting up/preparation of case' and that discovery of documents took in excess of 20 hours.  She deposed that the preparation of the damages schedules took in excess of 15 hours.

2. Slater & Gordon have engaged legal costs specialists, Coulson Legal, who have assessed the plaintiff's file and provided a draft bill of costs in the sum of $273,676.80 for professional costs.  A further sum of $88,918.21 will be claimed for costs of taxation and disbursements. 

3. The principles applicable to an award of indemnity costs following the rejection of a Calderbank offer were set out by the Court of Appeal in Ford Motor Company of Australia Ltd v Lo Presti [2009] WASCA 115 [16] – [32] and summarised in Owston Nominees No 2 Pty Ltd v Clambake Pty Ltd [2011] WASCA 76(S) [9] as follows:

   …

   (i)A Calderbank offer will not justify an award of indemnity costs unless its rejection was unreasonable.

   (ii)All the relevant facts and circumstances must be considered in determining whether a party's rejection of a Calderbank offer was unreasonable.

   (iii)The mere fact that the recipient of a Calderbank offer is ultimately worse off than he or she would have been had the offer been accepted, does not [of itself] mean its rejection was unreasonable.

   (iv)Relevant circumstances in assessing reasonableness include:

   (a)The stage of the proceeding at which the offer was received.

   (b)        The time allowed to the offeree to consider the offer.

   (c)        The extent of the compromise offered.

   (d)The offeree's prospects of success, assessed as at the date of the offer.

   (e)The clarity with which the terms of the offer were expressed.

   (f)Whether the offer foreshadowed an application for indemnity costs in the event of it being rejected.

4. Mr Tedeschi submitted that the defendant's position was unrealistic, and gave insufficient regard to the risks of litigation and that the rejection of the plaintiff's offer was unreasonable.  He submitted that the defendant should not have taken an all or nothing approach and in doing so ignored the strength of the plaintiff's case.  In other words, failed to negotiate and compromise. 

5. He submitted that the plaintiff's offer was a genuine attempt to compromise and was very reasonable, judged by the fact that it was substantially less than the judgment sum.

6. Mr Clyne submitted that the plaintiff had failed to prove that its attitude to the settlement was unreasonable.  He submitted that the letter making the Calderbank offer should have explained or argued the reasoning behind it.

7. I am satisfied that the criteria referred to at [9](iv)(a), (b), (c), and (f) above support the plaintiff's contention.  As to (a), his offer was made well before the trial, although it is counter-intuitively arguable that the offer was premature having regard to the amount of getting up work that was still to be done.  Nevertheless, the defendant had plenty of time to consider it, counter offer or otherwise re-negotiate the matter.  The offer itself was prima facie reasonable having regard to the plaintiff's best case scenario which was effectively double the offer (see [17] below). 

1. I do accept that the basis of the offer could have been set out with greater clarity, at least as a basis for negotiation.  In particular, did the offer predicate the best case damages scenario with a discount for the risks of litigation, or did it predicate findings on all issues consistent with my judgment?  Or was it an informed guess or starting point for negotiations? 

2. This is important because liability was very much in issue.   If the plaintiff believed that his offer on quantum was a reasonable pre-estimate of the ultimate assessment he could have offered to agree to quantum alone and proceed to trial (and/or further negotiations) in relation to liability.  But, if it comes to that, so could the defendant. 

3. It is common ground that the assessment of damages was a complex exercise because of the multifactorial aetiology, all of which is reflected in my reasons for decision (see [126]). 

4. The plaintiff's best case scenario (over $2.5 million plus worker's compensation entitlements) predicated findings that he had multiple intractable organic injuries. I rejected that contention and found that his residual organic injuries are relatively modest and that his chronic incapacity is substantially attributable to psychological and psychiatric factors ([630], [640] and [651]). The plaintiff's case at trial was inflexible and, as I said ([147]), it predicated 'a false construct (a fixed idea) to the effect that he really is as organically sick and disabled as he presents'. So the defendant was actually substantially successful at trial on the single-most important issue as to quantum.

5. In my opinion, any attempt by the defendant to pre‑empt the findings that were ultimately made and the manner in which I exercised my discretion in a number of areas (for example, as to the appropriate allowance for contingencies: see [672] - [673]) would have been fraught.

6. Therefore, having regard to the live issues as to liability and quantum, in my opinion the defendant was justified in taking a cautious approach to compromising or conceding any issue save for losses that had already crystallised or were in the process of crystallising from time to time before trial (for example, future economic loss transitioned into past economic loss), and was justified in taking the assessment of damages to trial in order to test the evidence, make submissions and leave the matter in the hands of the court.

7. I also take into account that the plaintiff's application for special costs orders succeeds (see below), so the plaintiff will be in a position to argue for reasonable costs. 

8. On balance, I am not satisfied that the defendant's rejection of the plaintiff's offer was unreasonable and the application for an award of indemnity costs is dismissed.

Special costs orders

1. I commence with two fundamental points.  First, liability was in issue and reasonably so.  Neither party could have gone to trial confident of the outcome.  Second, the trial in respect of liability was not novel, complex or forensically difficult in any way.  Each party called a small number of lay witnesses to testify about a relatively straightforward (albeit unusual) event.  The plaintiff called an unnecessary expert (Mr Ciaran MacCarron) whose evidence did not figure in my deliberations.  So, the complexity and work-requirements in this matter only informed the assessment of damages.

2. Having regard to Ms Ferraro's evidence, the defendant has properly conceded that the limits imposed by the Legal Profession (Supreme Court) (Contentious Business) Determination 2016 should be removed with regard to the preparation of schedules of damages (scale item 16b) and the preparation of case for trial (scale item 17).

3. As to the fee on brief for the first day of trial, the relevant scale allowance predicates 3.5 days' work.  The plaintiff seeks 10 days which, according to Mr Tedeschi's submissions, equates to the time actually expended.  I have examined his fee notes (annexures 'IRS 1-3' to Ms Ferraro's supplementary affidavit) and identified 79.5 hours described as preparation for trial or similar, although some of that work was evidently carried out some time before the trial itself and could have been designated as preparation of case (item 17). 

4. I am satisfied that 3.5 days is not an adequate allowance.  The assessment of damages was lengthy and factually complex as I have mentioned and the parties called a number of expert witnesses.  I should add that the trial proceeded smoothly because it was well prepared and the parties agreed on the admissibility of a large number of documents.  I accede to the application and increase the allowance for preparation for trial by counsel to 10 days, bearing in mind that the taxing officer has a discretion to determine the appropriate allowance.

5. As to the claim for an advice on evidence, I am satisfied that it was appropriate work and was properly done.  However, I am again concerned that there may be some overlap with item 17 and counsel's fee on brief, notwithstanding the temporal disconnect.  No doubt the taxing officer will be mindful of this.

6. Finally, I am satisfied that an allowance should be made for an instructing legal practitioner attending trial (scale item 20(e)).  Both parties employed an instructor which noticeably contributed to the smooth running of the trial in a number of ways, including liaising with and marshalling witnesses, managing exhibits, note‑taking, managing transcript and liaising with my staff.

Conclusion

1. For these reasons I make orders in terms of pars 3(c), (d), (e), 4(c) and (e) and (f) of the plaintiff's application, which is otherwise dismissed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia.

JM
Secretary

10 FEBRUARY 2023