Jones v SNF (Australia) Pty Ltd

[2005] WADC 101

JURISDICTION     :   DISTRICT COURT OF WESTERN AUSTRALIA

IN CHAMBERS

LOCATION:   PERTH

CITATION:   JONES -v- SNF (AUSTRALIA) PTY LTD & ANOR [2005] WADC 101

CORAM:   REGISTRAR KINGSLEY

HEARD:   10 MARCH 2005

DELIVERED          :   25 MAY 2005

FILE NO/S:   CIV 2833 of 2000

BETWEEN:   BRADLEY IVAN EDWARD JONES

Plaintiff

AND

SNF (AUSTRALIA) PTY LTD
First Defendant

WESFARMERS LIMITED
Second Defendant

SEELEY AUTO ELECTRICAL PTY LTD
First Third Party

DON PATRICK BINGHAM t/as DP BINGHAM & ASSOCIATES
Second Third Party

Catchwords:

Practice - Application for costs payable forthwith - Application for costs payable on indemnity basis

Legislation:

Workers' Compensation and Rehabilitation Act 1981

Result:

Application to pay costs forthwith refused
Application to pay costs on indemnity basis refused

Representation:

Counsel:

Plaintiff:     Mr K Pratt

First Defendant              :     Mr G T Stubbs

Second Defendant         :     No appearance

First Third Party            :     No appearance

Second Third Party       :     Mr M T S Rennie

Solicitors:

Plaintiff:     Trewin Norman & Co

First Defendant              :     Dwyer Durack

Second Defendant         :     McAuliffe Williams & Partners

First Third Party            :     Michael Paterson & Associates

Second Third Party       :     Mr Michael Rennie

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

Batten v CTMS Ltd (1999) FCA 1576

Life Airbag Company of Australia Pty Ltd v Life Airbag Company

(New Zealand) Ltd,  unreported; BC 9801995; 22 May 1998

Case(s) also cited:

Nil

1. REGISTRAR KINGSLEY:  On the plaintiff's application to substitute a statement of claim the first defendant seeks an order that the plaintiff pay its costs on an indemnity basis and forthwith in respect of the plaintiff's application to substitute statement of claim.

2. In relation to the same application the second defendant seeks orders that the plaintiff pay the second defendant's costs and those costs to be taxed and paid forthwith.

3. The action has had a long history.  Briefly the plaintiff was severely injured in November 1998.  The plaintiff was engaged to replace a starter motor on a tanker.  On completion of the task the plaintiff started the starter motor.  Upon doing so a pipe within the air supply pipeline separated from a rubber coupling and struck the plaintiff on the head.

4. The plaintiff commenced an action against the first defendant

   
   

   SNF (Australia) Pty Ltd ("SNF") and Wesfarmers Limited on the basis that SNF was the owner of the tanker and Wesfarmers Limited was the operator of the tanker. In July 2002 Wesfarmers applied to this Court to have the plaintiff's claim against it struck out on the basis Wesfarmers was a deemed employer by virtue of s 175 on the Workers' Compensation and Rehabilitation Act 1981.  His Honour Judge Martino determined the application in Wesfarmers favour.  This decision was appealed to the Full Court of the Supreme Court of Western Australia and, ultimately, the appeal was dismissed. 

5. In July 2004 the plaintiff filed a chambers summons seeking, amongst other things, an order that the statement of claim in the proceedings be substituted by a minute of substituted statement of claim dated 8 July 2004 (the July 2004 minute).

6. The first defendant submits that, by letter dated 20 July 2004, they wrote to the plaintiff's solicitors identifying specific paragraphs in the July 2004 minute that was said to be embarrassing.  The plaintiff's chamber summons was heard on 28 July 2004 and adjourned to a special appointment.

7. The first defendant submits that between 28 July 2004 and 19 August 2004 (the hearing) the plaintiff had ample opportunity to correct the defects in the July 2004 Minute but failed to do so.

8. At the hearing on 19 August 2004 the first defendant submitted that the July 2004 minute disclosed no reasonable cause of action and was prejudicial, embarrassing or likely to delay fair trial of the action.

9. On 3 September 2004, I found that whilst the July 2004 minute disclosed a cause of action against SNF the minute was embarrassing.  I refused to allow the plaintiff to substitute the statement of claim.  The plaintiff filed a fresh minute of proposed substituted statement of claim.  The matter came back for hearing in November 2004 and, again in a reserve decision, I determined that the fresh minute remained embarrassing and ordered the plaintiff to file a further fresh minute of substituted statement of claim before 20 January 2005.  The fresh minute was dated 17 January 2005.

10. On 10 March 2005 I made orders that the minute dated 17 January 2005 do stand as the plaintiff's statement of claim in the action.

11. Both the first and second defendant submit that the plaintiff has now filed four minutes of proposed amended or substituted statements of claim involving the second defendant and that the 17 January statement of claim has virtually taken the proceedings back to the start.  SNF had a third party action against Bingham which in all probability will now be converted to a contribution proceeding.  The third party proceedings against Bingham are not advanced as the second defendant has not filed a defence.

Costs Payable Forthwith

1. The Supreme Court Rules provide the basis for a court to make orders to pay costs before proceedings are concluded (Rules of the Supreme Court O 66 r10 (1)). Costs are ordered to be payable forthwith where it is unfair for the successful party to have to wait until the conclusion of the proceedings to obtain the costs which form part of the fruits of their victory. The demands of justice thus require a departure from the usual rule that an order for costs in an interlocutory proceeding is taxed when the principle proceeding is concluded. (Life Airbag Company of Australia Pty Ltd v Life Airbag Company (New Zealand) Ltd,  unreported; BC 9801995; 22 May 1998; Branson J)

2. The first defendant submits that it would be unfair for the first defendant to have to wait until conclusion of the proceedings to obtain their costs.  The first defendant's counsel submits the plaintiff should not have proceeded with this application in the form that they did and that the final determination is likely to be some time away.  Further the first defendant gave notice they would oppose the substitution of the July 2004 Minute and the plaintiff's solicitors, whilst saying they would address their concerns, never did.

3. Again relying on the Life Airbag case, the first and second defendants submit the parties have been required to incur significant costs over and above those which would have been incurred had the opposing party acted in the handling of the proceeding with competence and diligence.  They are costs in reality thrown away and in respect of which the demands of justice require a departure from the general practice.

4. The first defendant cites Batten v CTMS Ltd (1999) FCA 1576 in support of its submission that the costs ought to be payable forthwith. Battens case related to a defective statement of claim.  The Court noted that it took almost a year and three attempts to constitute the action, and deficiencies in the pleadings were drawn to the applicant's attention early in the proceedings.  Despite indications from time to time that information sought would be provided the information in fact was not forthcoming.  Thus the first defendant submits Batten is analogous to the present case.

5. The plaintiff's action has not been without some complexities.  The plaintiff has suffered a severe head injury and reconstruction of the events may well have been very difficult.  The case of Batten is distinguishable in that the applicants were members of a larger group.  The Life Airbag Company case was in the context of an initial application that the applicant provide security for costs.

6. An order for costs payable forthwith may, in the context of these proceedings, act as a means of stifling the litigation.  Whilst the defendants could execute immediately on the judgment after taxation, in any event until the costs are paid the action can be stayed.

7. Further the issues raised by the plaintiff are attendant with some complexities.  Whilst the statement of claim has undergone a number of amendments this has not been by the pursuit of an ill considered and perhaps unnecessary claim.  Accordingly, I am not persuaded that it is appropriate, in the circumstances of this case, to award costs forthwith.

Indemnity costs

1. The first defendant seeks that any award of costs be on an indemnity basis.  The Court does not usually award indemnity costs unless there is a special and unusual feature in the case justifying a departure from the usual practice of costs being on a party party basis.  The category of special circumstance is not a closed category and first defendant's counsel submits that in this case there are special circumstances.  These are stated to be:

   (a) The plaintiff acted unreasonably in failing to address the defects of the statement of claim despite being warned and agreeing to address those defects.

   (b) The first defendant incurred unnecessary costs being costs of opposing the application.

   (c) The plaintiff in not addressing the defects has delayed the proceedings.

2. The first defendant's counsel submits that the plaintiff has acted unreasonably because it's pursued the action beyond a point which, if properly advised, the plaintiff should not have pursued it, and having pursued the case when they'd been put on notice that the case is misconceived.

3. An award of indemnity costs is awarded where there has been some form of delinquency in the conduct of the proceedings.  It is suggested that the civil business of the Court could not operate satisfactorily if case management directions are not complied with and so conduct by a party designed to subvert the spirit of case management may warrant an order for indemnity costs, even forthwith.  In the context of case management it may well be unnecessary for there to be conduct deserving of moral condemnation.  But the underlying theme is a focus on the party's conduct.  Indemnity costs may be awarded where a party's conduct unacceptably departs from the standard of litigation which prevents the court from conducting the action in an expeditious way.

4. In my opinion the conduct of the plaintiff does not fall into this category  I am not persuaded that the plaintiff's conduct of the action has unacceptably departed from the standard that an order for indemnity costs ought to be allowed.

Costs

1. The order for costs will be that the plaintiff pay the defendant's costs on the application, including reserved costs, and costs thrown away occasioned by the amendment to be taxed in any event.