Jones v Braund (No. 3)

[2020] NSWDC 74

District Court

New South Wales

• Amendment notes

Medium Neutral Citation:	Jones v Braund (No. 3) [2020] NSWDC 74
Hearing dates:	On the papers
Date of orders:	01 April 2020
Decision date:	01 April 2020
Jurisdiction:	Civil
Before:	Abadee DCJ
Decision:	See paragraph 60
Catchwords:	PRACTICE AND PROCEDURE – orders to dispose of proceedings – application to invoke ‘slip’ rule in relation to provisional finding on quantum of out of pocket expenses   COSTS – Calderbank letter – whether rejection by offeree reasonable – offer of compromise – plaintiff awarded monetary judgment in sum no more favourable than offer for damages – whether rejection by offeree reasonable – whether Court should “otherwise order” in the exercise of its discretion – cap on damages where monetary judgment is for less than $100,000 in respect to personal injury damages claim
Legislation Cited:	Civil Liability Act 2002 (NSW) ss 5O, 11, 11A Civil Procedure Act 2005 (NSW) s 98 Evidence Act 1995 (NSW) s 131 Legal Profession Uniform Application Act 2014 (NSW) Schedule 1 Uniform Civil Procedure Rules 2005 (NSW) rr 20.26, 42.1, 42.13, 42.15, 42.15A, 42.16
Cases Cited:	Commonwealth of Australia v Gretton [2008] NSWCA 117 Croghan v Blacktown City Council [2019] NSWCA 248 Gretton v Commonwealth of Australia [2007] NSWSC 149 Hatton v Harris [1892] AC 547 Hillier v Sheather (1995) 36 NSWLR 414 Jones v Braund [2020] NSWDC 32 Jones v Braund (No.2) [2020] NSWDC 54 Leach v The Nominal Defendant (QBE Insurance (Australia) Ltd) (No.2) [2014] NSWCA 391 Morgan v Johnson (1998) 44 NSWLR 578 Regency Media Pty Ltd v AAV Australia Pty Ltd [2009] NSWCA 368 The Uniting Church v Takacs (No 2) [2008] NSWCA 172 Walker v Harwood [2017] NSWCA 228
Texts Cited:	Ritchie’s Uniform Civil Procedure (NSW)
Category:	Principal judgment
Parties:	Mr RM Jones (Plaintiff) Mr M Braund (Defendant)
Representation:	Counsel: Plaintiff appeared in person Mr R O’Keefe for the Defendant   Solicitors: Mills Oakley for the Defendant
File Number(s):	2018/135378
Publication restriction:	Nil

Judgment

INTRODUCTION

1. I gave reasons for judgment in this matter on 19 March 2020[1] whilst giving the parties the opportunity to make submissions as to final orders. The parties have supplied the Court with proposed short minutes and written submissions in support [2] . As at trial, Mr Jones prepared his documents by himself; without legal representation.

   1. Jones v Braund (No.2) [2020] NSWDC 54 (hereafter ‘the Reasons’).

   2. The directions at the conclusion of the Reasons were designed to ensure that the plaintiff would respond to the defendant’s submissions: [510] of the Reasons.

2. Nothing of substance was agreed between the parties in respect to orders disposing of the proceeding. The remaining issues are:

1. what allowances should be made to the plaintiff for:

1. past out of pocket expenses; and

2. future out of pocket expenses,

2. what is the allowance for interest on past out of pocket expenses; and

3. what orders for costs should be made having regard to:

1. a Calderbank offer made by the defendant on 7 February 2020;

2. a purported ‘rules offer’ served by the defendant on 10 February 2020; and

3. the application of provisions in Schedule 1 of the Legal Profession Uniform Application Act 2014 (NSW) (‘LPULAA’).

3. What follows assumes some familiarity with the Reasons.

DAMAGES

Past out of pocket expenses

4. The defendant invokes the slip rule to seek what it regards as a need for correction of the amount for past out of pocket expenses I provisionally [3] indicated should be awarded in the Reasons. The plaintiff did not address this application in his submissions in response.

   3. At [484]-[486] & [507] of the Reasons.

5. The defendant contends that the amount awarded should be $34,793.12; and not the sum of $54,793.12 which I had foreshadowed.

6. The defendant is correct that there is a slip, in the sense of an arithmetical error; but the error does not work in his favour.

7. My intention – which the defendant correctly divines – was to add the separate amounts of $34,793.12 and $22,000. That yields the sum of $56,793.12 – not the amount of $54,793.12 provisionally referred to at [507] of the Reasons. As the Reasons indicated (at [479]), those amounts were intended to reflect, respectively, Mr Jones’ out of pocket expenses up to 17 May 2016 and the sum which Mr Jones paid to Dr Braund’s practice.

8. Formally, and subject to dealing with the defendant’s contention regarding his fees, I do not consider that it is necessary to invoke the slip rule. The reference to the figure was a finding that was plainly expressed to be provisional and subject to further submission by the party. That has subsequently occurred. No order was made.

9. The defendant submits that I should not have allowed the sum of $22,000 as a component for past out of pocket expenses. He contends that having rejected the plaintiff’s non-disclosure/advice case against him, it followed that the plaintiff agreed to proceed with the treatment and therefore was obliged to pay Dr Braund’s fees (irrespective of the outcome of those services). This submission does not grapple with the finding that I made about the defendant’s negligent treatment and the consequences flowing from that finding.

10. This submission intrinsically amounts to an attack on a finding on its merits. It is a submission that could have been, but was not advanced at trial (or at least with any clarity). Had the matter been raised during trial, it could not be said that it would have been (reasonably) accepted by Mr Jones as a matter of course (Hatton v Harris [1892] AC 547 at 558). I therefore decline to accede to the defendant’s application in this regard. Apart from the arithmetical error I have noted in a provisionally based factual finding, there is no need for further correction.

Interest on past out of pocket expenses

11. The interest is calculated on the sum of $56,793.12. By my calculations, the interest on that sum up to 1 April 2020 is $15,669.45, however I propose to allow the parties a final opportunity to check the correctness of that calculation.

Future out of pocket expenses

12. The defendant submits that in light of the finding that the scope of the defendant’s liability should not extend beyond May 2016 ([452]-[454]), he has no liability for future out of pocket expenses.

13. The plaintiff seeks to revise, upwards, his claim for future out of pocket expenses. In effect he is seeking to re-agitate, or perhaps more accurately, agitate a varied case on this claim. He supplied yet another proposed version of a statement of particulars for this purpose. This is impermissible: absent exceptional circumstances, a litigant is not entitled to effectively seek to re-open a case to advance new claims or evidence after reasons for judgment have been published. No attempt was made to establish that exceptional circumstances arise here.

14. The plaintiff did not argue what his claim could, or would be, on the basis of the causation finding actually made.

15. The defendant’s submission should be accepted with the consequence that there is no allowance made for this head of damage.

Non-economic loss

16. There is no dispute that on the basis that the non-economic loss is to be assessed at the level (20%) of the most extreme case referred to (at [477]) in the Reasons, the sum for this head of damages is $23,030.

17. The plaintiff submits that the sum should be calculated on a most extreme case set at a different level. Although he gave evidence about the nature of his ‘non-economic loss’ at trial, the plaintiff had made no submission as to what that level of a most extreme case should be. He now claims that the Court “undervalued” his claim in this respect. Whether the Court did or did not undervalue the claim for this component may be a matter for appeal. It is not a basis for now challenging a finding that the Court has made.

18. The sum of $23,030 is allowed for non-economic loss.

Summary on damages

19. The plaintiff should recover a Verdict and Judgment for the sum of $95,492.57.

COSTS

20. The defendant does not cavil with the correctness of the general proposition that costs should follow the event (r 42.1 of the Uniform Civil Procedure Rules 2005 (NSW)) (‘UCPR’). However, he seeks to qualify the application of that rule in two respects. First, he relies upon two settlement offers made in February 2020; not long before the commencement of the trial (24 February 2020). Those offers, he said, were rejected by the plaintiff and the plaintiff ultimately obtained an outcome no more favourable to him than the terms that had been offered to him by the defendant.

21. The second qualification which the defendant invokes is that because the plaintiff has obtained a monetary verdict less than $100,000 for his claim being, by nature, a claim for personal injury damages, insofar as he seeks his costs, the plaintiff is subject to the cap on the recovery of costs set out in clause 2 of Schedule 1 to the LPULAA.

The defendant’s settlement offers

22. As noted in the introduction, there were two settlement offers, made close in time.

23. This proceeding commenced on 30 April 2018. The plaintiff has been unrepresented in the proceeding since March 2019.

24. The first settlement offer was a ‘Calderbank’ letter by the defendant’s solicitors (‘Mills Oakley’). Its content was relevantly as follows:

“Dear Mr Jones

Braund ats Jones

District Court of NSW Proceedings no. 2018/00135378

We refer to the abovementioned proceedings.

Our client is confident that he will successfully defend these proceedings, that your claim will fail and that you will be ordered to pay our client’s legal costs and disbursements.

We advise that our client’s legal costs and disbursements at this point in time are in excess of $100,000 and that amount will have significantly increased by the time the hearing of these proceedings is concluded.

A central question in these proceedings will be whether our client acted in a manner that was widely accepted in Australia by peer professional opinion as competent professional practice. We refer you to section 5O of the Civil Liability Act 2002 (NSW) (“Civil Liability Act”) which is pleaded at paragraph 35 of our client’s Amended Defence.

Our client will make submissions to the Court that the expert evidence of Dr Howe in relation to the conduct of the All-on-4 procedures should not be accepted as “peer professional opinion”, particularly when compared with the evidence to be given by Dr Benge. Dr Howe does not, and we understand has never performed an All-on-4 procedure, whereas Dr Benge has performed thousands of those procedures. Therefore, it is our client’s view that Dr Howe is not a “peer” of our client and Dr Howe’s opinion on our client’s conduct should not be admitted into evidence.

Furthermore, if Dr Howe’s report is admitted into evidence Dr Howe will be cross-examined by our client’s counsel in relation to these matters. On those bases, it is our client’s view that you will not be able to overcome section 5O of the Civil Liability Act.

To the extent that you intend to call Dr Willey as a witness in your case, our client will object to his evidence on the basis that he is not independent and has not prepared an independent expert report that meets the requirements of the Uniform Civil Procedure Rules 2005 (NSW).

Nevertheless, our client is aware that in order to continue to a hearing of these proceedings he will need to incur further legal costs. In order to avoid incurring those costs, our client makes the following offer on a purely commercial basis:

1. Our client will pay to you the sum of $100,000 inclusive of interest and costs and disbursements

2. The proceedings as between our client and you will be dismissed with no order as to costs.

The offer is open for acceptance until 4pm on Monday 10 February 2020. The offer will lapse after that time.”

25. This offer was sent by email to Mr Jones at 5:04pm on 7 February 2020.

26. Mr Jones did not take long to reject it. He sent an email to a solicitor at Mills Oakley (Mr Adair) at 6:52pm on the same day, in which he provided reasons for rejecting the offer and he put a counter-offer. It is not necessary to reproduce the content of this email save to say that it did not reflect well upon Mr Jones, if his reaction was to be compared to that of a reasonable litigant, properly informed and advised, in his position. Fundamentally, the plaintiff expressed his belief that he could not lose.

27. The next Monday afternoon, at about 4:28pm on 10 February 2020, Mills Oakley sent an offer of compromise under cover of a letter expressed to be ‘without prejudice as to costs’.

28. The offer of compromise was expressed to be in the following terms:

“1. The Defendant offers to compromise the proceedings as between the Plaintiff and the Defendant on the following terms:

a. The Defendant pay to the Plaintiff the sum of $105,000 in respect of the Plaintiff’s claim against the Defendant.

b. The Defendant pay the Plaintiff’s costs as agreed or assessed up to the time that this offer is made.

The proceedings as between the plaintiff and the Defendant be dismissed.

2. This offer is made in accordance with rule 20.26 of the Uniform Civil Procedure Rules 2005 (NSW).

3. This offer is open for acceptance until 4:00pm on 18 February 2020.”

29. As with the earlier Calderbank offer, Mr Jones did not take long to reject the offer of compromise. He sent an email at 5:47pm on 10 February 2020. I make the same comment about his reaction to the offer as I made in connection with his response to the Calderbank letter of 7 February. In addition, the plaintiff’s response manifested a complete ignorance or lack of appreciation of any risk that he might be exposed to adverse costs consequences should any monetary verdict he receive be no more favourable than the terms of the offer of compromise.

Consideration of the settlement offers

The plaintiff’s submission on costs

30. After receiving notice of the defendant’s intention to rely upon these settlement offers after the Reasons were published, the plaintiff did not make any submissions justifying his rejection of them (beyond the contemporaneous reasons he supplied at the time of their rejection). He did make complaint, albeit expressed in very vague terms, about some settlement negotiations.

31. The defendant objected to my even considering the communications which the plaintiff sought to rely upon, apparently relying upon s 131(1) of the Evidence Act1995 (NSW). Plainly, the plaintiff was seeking to bring to the Court’s attention attempts to settle. The general prohibition on disclosure of settlement negotiations in s 131(1) is, however, subject to an exception under s 131(2)(h) and it appeared to me that the communications which the plaintiff sought to draw to the Court’s attention regarding attempts to settle were relevant to the question of liability for costs.

32. However, the content of the communications do not assist the plaintiff. To the extent that there is a reference to what were purely verbal negotiations as to settlement sums, the plaintiff has not bettered them by the monetary verdict he will receive. To the extent that he refers to out of court discussions between the defendant and Dr Willey, there is not only a problem of hearsay, but there is no means by which the Court could even quantify the value of any “agreement” with Dr Willey, assuming that there be one: even if the defendant’s email to the plaintiff dated 10 March 2020 (sent at a time when judgment was reserved) could be taken into account, which is far from obvious, it is also not apparent that it betokened any clear offer of settlement.

The Calderbank Letter

33. In my view, the defendant has difficulty in establishing that the sum offered ($100,000 inclusive of interest and costs) fulfilled both the requirements of a successful Calderbank offer, being that the offer amounted to a reasonable offer of settlement and that it was unreasonable for the plaintiff to reject it. ‘Reasonableness’, in the latter respect, is to be viewed prospectively at the time of the offer; and not in hindsight (Grettonv Commonwealth of Australia [2007] NSWSC 149 at [24]).

34. It is unnecessary to parse too closely these requirements in relation to this settlement offer. As noted, the plaintiff ceased to obtain legal representation in March 2019. By then, the proceeding had already been on foot for virtually 11 months and I infer that the plaintiff would have incurred substantial expense in his representation to that point even before he commenced to represent himself. In the ultimate result, I expect that by March 2019, his costs (incurred in the period that he was represented) would, in combination with the judgment amount (even excluding interest), have exceeded the terms of the offer contained in the Calderbank letter.

35. Even if that was not so, it is also apparent by the breadth and scope of the Reasons, there were some complex issues of fact and law, particularly on liability issues, which would mean that the likely outcome was far from predictable. As is apparent in the Reasons, the plaintiff had a variety of complaints against the defendant, ranging from a failure to warn case to the case of negligent treatment. Depending on the outcome on liability, there were various permutations in the way the claims for past out of pocket expenses and future out of pocket expenses would be assessed. The defendant, for his part, put in issue whether s 5O of the Civil Liability Act 2002 (NSW) might be a complete or partial answer to those claims.

36. Further, I note that the matters of substance that were specifically brought to the plaintiff’s attention in the Calderbank letter, constituting the reasons why he should accept the offer – being the s 5O defence and a prediction that the evidence of Dr Howe and Dr Willey would not be admitted – were matters upon which the defendant failed at trial. Subsequent events show that it was reasonable for the plaintiff not to be influenced by them in deciding whether to accept the offer.

37. The content of the Calderbank offer does not, itself, incline me to vary the usual order for costs referred to under the Court rules.

The offer of compromise

38. The plaintiff did not submit in terms that the content of the offer of compromise did not comply with r 20.26 of the UCPR.

39. I accept that the amount that the defendant offered in respect to his damages claim was sufficient to constitute a genuine offer of compromise and was not one which had been merely designed to trigger costs consequences under the rules. The offer relating to damages (alone) (term 1(a)) was for $105,000. Disregarding interest on the sum for past out of pocket expenses (as required under r 42.16 of the UCPR), the plaintiff recovered damages in the sum of $79,823.12.

40. The defendant only allowed the plaintiff a period of 8 days to accept the offer of compromise. He submits that this period was reasonable (as per r 20.26(5)(b) of the UCPR). In this respect, he cites the prompt rejection by the plaintiff of the offer. The offer of compromise was not served literally on the eve of the hearing and, although it was served at a time when it would have been expected that the plaintiff was absorbed in preparation for the hearing, there was no suggestion by the plaintiff that it served as a distraction from that preparation. To the contrary, it would be expected that, 8 days before the trial, a reasonable litigant in the plaintiff’s position, or at least one who was properly informed, would have an appreciation of the strengths and weaknesses of the case. The plaintiff did not express any contrary contention in these respects. I find that the offer of compromise was served within a reasonable period of time, for the purposes of the rules.

41. A problem with the offer of compromise is that, notwithstanding that I have found that it constituted a genuine offer of compromise insofar as the component that related to damages, at the time it was served it was difficult to ascribe value to the component of the offer that dealt with costs (term 1(b)). Neither in the terms of the offer itself nor in the explanatory covering letter was there any indication provided that the defendant took the view and, if appropriate, would later submit to the Court, that if the quantum of damages fell below $100,000, the plaintiff’s costs would, by operation of the LPULAA, be capped. That may not necessarily have sufficed to invalidate the offer, but the costs component of the offer did not draw out fairly its value to the plaintiff. That is relevant to the question of the Court’s discretion to which I now turn.

Should the Court ‘otherwise order’?

42. Subject to what I have just said about the costs component of the offer of compromise, insofar as the damages component (term 1(a) of the offer) is concerned, it should be accepted that the plaintiff has obtained a monetary outcome no more favourable to him than the terms which were offered to him under the offer of compromise. That gives rise at least to a ‘conditional entitlement’ (Hillier v Sheather (1995) 36 NSWLR 414) in the defendant to receive his costs on an indemnity basis from 11 February 2020.

43. That, however, is subject to the Court ‘otherwise’ making order under r 42.15(2) of the UCPR. The onus falls upon the plaintiff to establish why it should do so. Another way of putting that is to say that the rule that ‘costs follow the event’ is redefined in the circumstances so that the ‘event’ is whether or not the offeror (here the defendant) obtains a better result than that which was contained in the offer of compromise, subject to plaintiff persuading the Court to exercise its discretion to order otherwise (Walker v Harwood [2017] NSWCA 228 per Basten JA at [19]-[20], Payne JA agreeing). To that end, whatever be the nomenclature, the onus is upon the plaintiff to show that the circumstances are not ‘ordinary’, but ‘exceptional’ in the sense that they are ‘extra-ordinary’ (Walker at [17]). The Court may exercise its discretion with reference to all of the circumstances of the case (Regency Media Pty Ltd v AAV Australia Pty Ltd [2009] NSWCA 368 at [15]).

44. Although the circumstance that it was not unreasonable to reject an offer is not sufficient in isolation to displace the ordinary operation of the rules, it remains relevant to the exercise of the discretion: The Uniting Church v Takacs (No 2) [2008] NSWCA 172 (at [15]) per Hodgson JA (McColl JA agreeing); followed in Leach v The Nominal Defendant (QBE Insurance (Australia) Ltd) (No.2) [2014] NSWCA 391 per McColl JA (Gleeson JA and Sackville AJA agreeing) at [48]. This was recently described as a “significant” consideration in the Court’s decision as to whether to ‘otherwise order’ in Croghan v Blacktown City Council [2019] NSWCA 248 at [12]-[13] (Meagher JA, McCallum JA and Simpson AJA agreeing).

45. In my view, the considerations as to why it was reasonable for Mr Jones to reject the Calderbank letter which I alluded to earlier apply with similar force to the assessment of the reasonableness of his rejection of the offer of compromise sent the next business day.

46. With reference to an earlier version of r 42.15 in Morgan v Johnson (1998) 44 NSWLR 578, Mason P alluded to the purposes of the rule and emphasised, in particular the public and private dimensions of the rule in the following terms (citations omitted):

“(1)   The purpose of the rule is to encourage the proper compromise of litigation, in the private interests of individual litigants and the public interest of the prompt and economical disposal of litigation…

(2)   The aim is to oblige the offeree to give serious thought to the risk involved in non-acceptance...

(3)   The prima facie consequence of non-acceptance will be that the rule will be enforced against the non-accepting party… This is because, from the time of non-acceptance ‘notionally the real cause and occasion of the litigation is the attitude adopted by [the party] which has rejected the compromise’…

(4)   Lying behind the rule is the common knowledge that ‘litigation is inescapably chancy’:… For this reason, the ordinary provision is expected to apply in the ordinary case… The mere fact that it was reasonable for the litigant to take the view that he or she did in rejecting the offer is not enough to displace the rule… As Clarke JA expressed it…:

‘The rule lays down the general principle that should be applied, and the order provided for in that rule should only be departed from for proper reasons which, in general, only arise in an exceptional case…’

(5)   The discretion to displace the rule is a judicial one, requiring the private and public purposes of the rule to be borne in mind… Reasons must be given for ‘otherwise ordering’…”

47. To some degree, the force of proposition (4) (or at least the observation attributed to Clarke JA) above has been subsequently reduced by later appellate authority (see paragraph 43, above). I am mindful also, of the admonition that the point of the rules is to limit or discourage satellite litigation in relation to costs (Walker, per Basten JA at [32]). That is part of the public dimension of the rule to which Mason P adverted in Morgan.

48. I emphasise the private and public dimensions of these objects since in my opinion it is artificial not to recognise that the plaintiff was representing himself at the point when the offer of compromise was served. I say that not to emphasise the status of the plaintiff, but the consequence of his lack of representation: the obvious possibility of his being ignorant of the operation of Court rules like r 42.15 of the UCPR. There is a risk that the public and private purposes of the rule might not be facilitated where, as in a case like this, the offeree, for want of representation and proper advice, a party (as offeree) may not understand and indeed may be entirely heedless of the risks involved in non-acceptance of an offer nor the public interest in the prompt and economic disposal of litigation. To automatically impose the ordinary consequences of the rule might mean that the costs order misses its targeted purposes in this regard.

49. At least in respect to the ‘Calderbank letter’ sent to the plaintiff, its content referred to the name of the case giving rise to the expression of this type of settlement offer. The plaintiff was put on notice of the defendant’s intention to invoke the relevant principle to expose the plaintiff to a costs exposure if he rejected the offer and obtained a less favourable result. Here the offer of compromise, on its face, complied with the requirement (r 20.26(2)(d)) to refer to rule 20.26, however the costs consequences for rejection of the rules offer appear in a different part (Division 3 of Part 42) of the UCPR. In other words, in contrast to the Calderbank letter, nothing was done on the part of the defendant to alert the plaintiff to the costs consequences for his rejection of the rules offer if, as has now occurred, he obtained a no more favourable outcome than the terms that were offered.

50. In the commentary in Ritchie’s Uniform Civil Procedure (NSW) (at [20.26.40], it is said (although not self-evidently with reference to supporting authority) that assessment of what is a reasonable time for the purposes of the rules (i.e. r 20.26(5)) includes the information available to the parties – including awareness of the provisions in rr 42.13 – 42.15A. I am not persuaded that this circumstance necessarily assists the plaintiff on the point of how much time he had to reasonably consider the offer of compromise. There is no requirement under the rules, or even in general practice, for offerors to cite their reliance upon the operation of Part 42 when serving offers of compromise, but in my view, where there are indications that the offeree is ignorant of the rules, and, further, where it appears that a reasonable offeror might apprehend this state of affairs, the offeror’s omission to point out the potential operation of Part 42 is a relevant circumstance to be weighed when considering whether to ‘otherwise order’. To adopt the language in proposition (3) of Morgan, the continuation of the litigation following rejection of the offer may not exclusively be attributable to the offeree in the particular circumstances. At a general level, as Hodgson JA said in Commonwealth of Australia v Gretton [2008] NSWCA 117 (at [121]) (Mason P and Beazley JA – as her Excellency then was – agreeing), underlying the general rule as to costs (and exceptions to that rule, such as the costs consequences for rules offers), is the idea that costs should be paid in a way that is fair, having regard to what the Court considers to be the responsibility of the parties for the incurring of costs.

51. As I read the plaintiff’s response to the offer of compromise (through his email to Mr Adair on 10 February 2020), it clearly evinces a less than rational approach to litigation by the plaintiff of the kind that the operation of the rules is designed to engender. As I have said, the response evinced no regard whatsoever for the potential operation of r 42.15. I consider that this would have been reasonably self-evident to the legal representatives of the defendant. In the light of that communication, prudence would, or should, have suggested that the defendant’s legal representative might indicate to the plaintiff the defendant’s intention to rely upon the provisions in Part 42 of the UCPR.

52. In the Reasons I referred to my assessment of the plaintiff (in the credit section, at [330]-[334]). I referred, amongst other things, to his industry and his honesty. Implicitly, the detailed nature of the Reasons and the broad array of issues covered by them testify also to his intelligence. But it is as well to add that the plaintiff showed very little appreciation of rules of practice and procedure; which has been illustrated by his serial applications to amend his statement of particulars[4] and even now, his submissions on dispositive orders to this proceeding which have sought to go beyond the findings made. (To a large degree, the plaintiff’s submissions were not directed to the appropriate dispositive orders at all, but contained criticisms of findings made in the Reasons).

    4. See Jones v Braund [2020] NSWDC 32 at [25].

53. Further, although the terms of the offer of compromise were more generous to the plaintiff than the terms of the Calderbank offer which had been served the last (business) day before (the offer was $105,000 exclusive of costs), as I have noted, to a litigant in the plaintiff’s position receiving the offer of compromise when he did, the plaintiff might reasonably have thought that the reasons for the defendant’s expressed confidence in successfully defending the claim brought against him remained the same as those which his solicitor had expressed in the Calderbank letter sent to the plaintiff on the previous business day; and, as I have found, those reasons were subsequently invalidated.

54. I do not intend to convey by these reasons that self-represented litigants should receive preferential status when considering applications to alter the usual costs consequences of rejected settlement offers. Further, in contested litigation, a represented party is not an unrepresented litigant’s keeper. But in the circumstances of this particular case I consider that:

1. the matters which the defendant conveyed to the plaintiff as founding his ‘confidence’ only one business day before the offer of compromise was made (those matters being the s 5O defence, the admissibility of Dr Howe’s and Dr Willey’s evidence) which would reasonably have been interpreted by the plaintiff as explaining the service of the rules offer, were ultimately established as unfounded;

2. the emotive nature of the plaintiff’s responses to both the Calderbank letter and the offer of compromise was indicative of a litigant who evinced little or no appreciation of the costs consequences for rejection of the offer of compromise;

3. this lack of appreciation of the costs consequences of rejecting the offer of compromise was a circumstance which should have been apparent to the defendant;

4. it was a simple expedient for the defendant – without requiring any elaboration – to have foreshadowed to the plaintiff his reliance upon the rules he now invokes to claim an entitlement to indemnity costs prior to the expiry of the offer; just as the defendant had earlier foreshadowed an intention to rely upon well-established principles to seek a costs order if the Calderbank letter was rejected if the plaintiff did not better it in the final outcome;

5. the omission to disclose on the face of the offer or in the correspondence which enclosed it that the value of the costs component of the offer was contingent upon the possible operation of the LPULAA (see further below);

6. the reasonableness of the plaintiff in rejecting the offer of compromise is elevated by the matters referred to in (a)-(e);

7. the continuation of the litigation after the plaintiff had rejected the offer of compromise is not exclusively attributable to the plaintiff; and

8. in the particular circumstances of this case, the private and public objects, or purposes, of the rules are not subverted by the Court exercising its discretion.

55. In my opinion, these circumstances, viewed in combination, make it appropriate for me to ‘otherwise order’ so as to alter the usual operation of r 42.15 of the UCPR.

56. There was no indication provided by the defendant, upon the service of the offer of compromise that if, in the event that it was found that the offer did not comply with the rules or the Court might “otherwise order”, the defendant might alternatively rely upon it as if it was a Calderbank letter; or otherwise that the defendant would contend that its content was relevant under the Court’s general discretion to award costs under s 98 of the Civil Procedure Act2005 (NSW). The defendant made no submission that, save for his contention that the rules in Parts 26 and 42 of the UCPR were engaged, service of the offer of compromise was something that otherwise should be taken into account in altering the effect of the usual rule that costs follow the event (r 42.1 of the UCPR). That being so, in my view, there is no basis for making a partial order for costs in the defendant’s favour where, as I have found the operation of r 42.15 is not engaged.

Cap on costs

57. In this proceeding, the plaintiff sought damages from the defendant relating to personal injury. That claim falls within Part 2 of the Civil Liability Act (ss 11 and 11A). It also makes applicable the provisions of the LPULAA.

58. Clause 2 in Schedule 1 of the LPULAA indicates that were the amount recovered by the plaintiff on such a claim does not exceed $100,000, the maximum costs recoverable by the plaintiff in connection with legal services provided to a plaintiff are fixed at 20% of the amount recovered, or $10,000 (whichever is greater). Sub-clause 2(4)(b) of Schedule 1 also indicates that when the maximum costs for legal services are so fixed, a court cannot order the payment by another party to the claim of costs in respect of those services an amount that exceeds the maximum.

59. Here the maximum costs for legal services provided to the plaintiff in connection with the claim are 20% of $95,492.57, which is the amount $19,098.51. I have little doubt that the plaintiff’s legal expenses incurred in the proceeding until March 2019 would have substantially exceeded that sum. That being so, I consider it appropriate to fix the sum for costs consistent with the statutory cap.

ORDERS

60. For the above reasons, I make the following orders:

1. Verdict and Judgment for the plaintiff for the sum of $95,492.57.

2. The defendant is to pay the plaintiff’s costs in the fixed sum of $19,098.51.

3. Liberty to apply on 7 days’ notice if there be any further application in relation to the calculations contained in this judgment.

4. Exhibits to be returned within 28 days.

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Endnotes

Amendments

01 April 2020 - Correction of minor typo.

Decision last updated: 01 April 2020