K'Mart Australia Ltd v McCann [No 2]

NEW SOUTH WALES COURT OF APPEAL

CITATION:      K'Mart Australia Ltd v McCann [No 2] [2004]  NSWCA 364

FILE NUMBER(S):
41172/03

HEARING DATE(S):               Determined on the papers

JUDGMENT DATE: 11/11/2004

PARTIES:
K'Mart Australia Ltd (Appellant)
Bruce Edward McCann (Respondent)

JUDGMENT OF:       Handley JA Ipp JA Pearlman AJA   

LOWER COURT JURISDICTION: District Court

LOWER COURT FILE NUMBER(S):          DC 3171/02

LOWER COURT JUDICIAL OFFICER:     Andrew ADCJ

COUNSEL:
R Cavanagh (Appellant)
A R Lakeman (Respondent)

SOLICITORS:
Hunt & Hunt (Appellant)
Heazlewoods Bushby (Respondent)

CATCHWORDS:
Application for costs on an indemnity basis - offers of compromise - application made pursuant to District Court Rules - Court of Appeal not bound by District Court Rules - relevant considerations

LEGISLATION CITED:
District Court Rules 1973, pt 19A r 2, pt 39A r 25(4)
Supreme Court Rules 1970 pt 52A r 11, pt 52A r 22(4)

DECISION:
Application dismissed.

JUDGMENT:

IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 41172/03

HANDLEY JA
IPP JA
PEARLMAN AJA

11 NOVEMBER 2004

K-MART AUSTRALIA LTD v BRUCE EDWARD McCANN [No 2]

Judgment

1. HANDLEY JA:  I agree with Pearlman AJA.

2. IPP JA:  I agree with Pearlman AJA.

3. PEARLMAN AJA:  The respondent obtained a verdict in the District Court for damages suffered by him in an accident on the appellant’s premises.  Liability had been admitted, and the only issue had been the assessment of damages.  Andrew ADCJ assessed damages in the sum of $238,541.23.

4. The appellant successfully appealed to this Court on the issues of past and future economic loss and future medical expenses.  This Court allowed the appeal with costs, set aside the judgment in the District Court except as to costs, and substituted a judgment for the respondent in the sum of $95,478.73.

5. Upon judgment being delivered, Mr Lakeman, counsel for the respondent, applied for an award of costs in the District Court and in this Court upon an indemnity basis, relying upon two offers of compromise made by the respondent.  The first, made on 2 April 2003, offered to settle the proceedings for $52,500 (plus party and party costs) and the second, made on 7 August 2003, offered to settle the proceedings for $95,000 (plus party and party costs).

6. In his written submissions, Mr Lakeman stated that the application for an award of indemnity costs was made pursuant to Part 19A rule 2 and Part 39A rule 25(4) of the District Court Rules 1973. However, the Court of Appeal is not bound to apply the District Court Rules in relation to the costs of the appeal. Rather, the discretionary power of the Court of Appeal to award costs is found in Part 52A rule 11 of the Supreme Court Rules 1970: Maitland Hospital v Fisher [No 2] (1992) 27 NSWLR 721 at 724, 727; Moore v Woodforth [No 2] [2003] NSWCA 46. That distinction is of some significance, because Part 39A rule 25(4) invests the District Court with a limited discretion in the award of costs after an offer of compromise has been…