Lipscombe, a & M. v Airflite P/L ACN 008 950 721

[1993] FCA 684

JUDGMENT No. ........ ..,,..a,,, ....,,...,.. 684 1 93

IN THE FEDERAL COURT OF AUSTRALIA	) )
NEW SOUTH WALES DISTRICT REGISTRY )	No NG 464 of 1992

)

GENERAL DIVISION )

BETWEEN:  A LIPSCOMBE AND M LIPSCOMBE
Applicants

m:	AIRFLITE PTY LIMITED ACN 008 950 721
Respondent

CORAM :  HILL J - 1 OCT 1993

PLACE : SYDNEY FEDERAL COURT Ok

DATED : 19 JULY 1993 AUSTRALIA PRINCIPAL REGISTRY

EX TEMPORE REASONS FOR JUDGMENT

The parties in these proceedings have reached agreement, by settlement, of the dispute between them, which agreement has been reduced to writing in short minutes of order which I have initialled and in respect of which I will in due course make the appropriate orders. The short minutes of order, however, leave open for determination by me the basis upon which costs are to be awarded. In arriving at a declsion on this matter I note firstly that the parties agree that judgment should be given for the applicants against the respondent, and that the respondent should pay the applicants' costs. The question, therefore, is as to the basis of those costs having regard, inter alia, to the fact that the agreed sum for judgment is $55,000.

Reference was made to 0.62 r. 36A of the Federal Court Rules. This rule is in two parts; sub-r.(l) is

concerned with the case where there has been an award of judgment for less than a specified figure. At the time the present proceedings were commenced that figure was $50,000, although it has now been increased to $100,000. The parties are in agreement, however, that the application of the rule should be determined by reference to the figure as at the time the proceedings were commenced, that is to say in July of 1992. On this basis no reduction of costs is required to be

made under sub-r.(l). Sub-rule (2) is in the following terms:

"If the Court or a Judge is of the opinion that a proceeding (including a cross-claim for a money sum or damages) brought in this Court could more suitably have been brought in another court or in a tribunal and so declares, then any costs to be paid, including disbursements will be reduced by one-third of the amount otherwise allowable under this Order."

It is submitted by the respondent that the present

is an appropriate case for the making of the declaration under

having regard to offers of settlement made in correspondence

sub-r. (2). For the respondent it is also submitted that

between the parties, I should form the view that the respondent should not be required to pay all of the applicants' costs. So far as this latter matter is concerned I accept the submissions of the applicants that the offer contained in the correspondence was subject to various conditions.

I have some doubt myself as to whether it was really made in an open letter, having regard to the fact that the respondent continued to maintain that their liability to the applicants, was limited to the figure admitted by the respondent in their defence and repeated in the letter of 13 October 1992, namely, $13,500. I would not reduce the costs which the respondent should pay, having regard to that correspondence.

A more substantial question is whether the present is a case where I should declare that the proceedings could more suitably have been brought in another court, in this case in the District Court. The present case is a somewhat rare one in that the proceedings were commenced in this Court at a time when the helicopter the subject of the proceedings was still in the course of being repaired and damages had not, at that time, been determined with any precision. It was for this reason that the applicants, in their statement of claim,

with continuing costs and losses which were estimated at claimed that they had suffered damage of $108,913.19, together $2,700.48 per week.

It is true that some of the items particularised in the statement of claim have, as a result of evidence, been shown to have been overstated. The evidence was not complete when the settlement took place so that it is impossible for me to form a decided view, one way or the other, as to the ultimate figure of damages which the applicants would have received. The point is that when the proceedings were commenced, that figure could not have been known. Indeed, some three more months were to elapse before the helicopter was finally repaired and back in working order.

Some evidence before me indicated that one of the reasons for the delay was that the Mr Lipscombe hoped that the cost of repairs might be borne by the respondent rather than that he would first have to pay them out of overdraft accommodation which was available to him, at least in part, and then seek reimbursement from the respondent. I do not regard in the circumstances it being unreasonable on Mr Lipscombe's part to entertain such a hope.

In any event, the evidence would suggest that there
were, as well, other factors that played a part in the delay.
The applicants have pointed out that the proceedings involved

respondents in Western Australia and that the national character of the Court and its ability wlthout unnecessary

expense to entertain an action between parties in one state against parties in another, is a factor which I should take into account in determining that this Court was more suitable than the District Court. I agree it is a factor which in a particular case might tip the scales, but it is hardly an overwhelming matter. Likewise I am sympathetic to the proposition that commencing proceedings in this Court might have ensured a speedier resolution of the matter than might have been the case if the proceedings had been commenced in the District Court of New South Wales. That fact on its own hardly could be used to suggest that this Court is for that reason the more suitable tribunal in which to hear the proceedings.

In the particular circumstances of the present case it seems to me that I should ask myself whether at the time the proceedings commenced it would have been unreasonable to have limited the damages which the applicants are entitled to claim to $100,000, that being the limit of the District Court's jurisdiction when the proceedings were commenced. Certainly if the case was one of which it could be said that the damages incurred could never have exceeded $100,000, the District Court would have been a more suitable forum to litigate the case.

However, it seems to me that there was sufficient uncertainty as to the quantification of damages at the time the proceedings commenced for it not to be possible for me to say with confidence that the District Court was a more suitable forum. Accordingly, I am not of the opinion that the proceedings could more suitably have been brought in the Dlstrict Court and I decline to make the declarations sought. In these circumstances, I would order that the respondent pay the applicants' costs. Those costs of course will be

determined on a party and party basis without reduction under
0.62 r.36A.

I certify that this and the
preceding five (5) pages
are a true copy of the Reasons
for Judgment herein of his Honour
Mr Justlce Hill.

Associate: S R (*hw;.h.

Date : 2+ s ~ P T 9 3

Counsel and Solicitors	P. Greenwood instructed by
for Applicant:	Minter Ellison Morris Fletcher
Counsel and Solicitors	G. Moore & C. Groenewegen
for Respondent:	instructed by Colquhoun & Colquhoun
Date of Hearing:	19 July 1993
Date Judgment Delivered:	19 July 1993