Merrell v SIFC

[2001] NSWDDT 18

Reported Decision 23 NSWCCR 161

Dust Diseases Tribunal

of New South Wales

CITATION:	Merrell v SIFC [2001] NSWDDT 18
PARTIES:	Hazel Merrell Stevedoring Industry Finance Committee and Others
MATTER NUMBER(S):	266 of 2000
JUDGMENT OF:	Armitage J at 1
CATCHWORDS:	Miscellaneous Matters :-
LEGISLATION CITED:
CASES CITED:
DATES OF HEARING:	21 February 2002
EX TEMPORE JUDGMENT DATE :	02/21/2002
LEGAL REPRESENTATIVES:	FOR PLAINTIFF: Mr R O'Keefe instructed by Slater & Gordon FOR DEFENDANT: Ms E Cheeseman instructed by Blake Dawson & Waldron

JUDGMENT:

1. On 14 December 2001 I decided for reasons given that day an application by notice of motion by the plaintiff, Hazel Merrell, under the Limitation of Actions Act 1974 (Qld) ("the Queensland legislation") against the Stevedoring Industry Finance Committee, the opponent on the motion, in favour of the plaintiff, the claimant on the motion.

2. Not having heard submissions up to that point on the question of costs from the parties, I indicated at the end of my reasons that I would hear the parties as to costs. Today Mr O’Keefe for the plaintiff/claimant on the motion and Ms Cheeseman for the defendant/opponent on the motion have made submissions on the question of costs of the motion. I thank counsel for their assistance, which has enabled me to deliver these ex tempore reasons today.

3. Mr O’Keefe submits that the appropriate order is that the defendant/opponent should pay the plaintiff/claimant’s costs or alternatively that costs should be costs in the cause. Ms Cheeseman submits that the plaintiff/claimant should pay the defendant/opponent’s costs of the motion. Because of an initial predisposition on my part that Ms Cheeseman’s likely submission should succeed I heard Mr O’Keefe for the plaintiff/claimant first.

4. Mr O’Keefe drew my attention to s 39 of the Queensland legislation, which reads:

Costs

In dealing with the costs of an action to which this Part applies and that is commenced after the expiration of the period of limitation otherwise prescribed by this Act but before the expiration of the period of limitation prescribed by s 29 the Court shall, in every case where costs may be awarded to the plaintiff, before awarding such cost, take into consideration -

(a) Whether reasonable diligence has been shown in the circumstances in commencing the action;

(b) Whether delay in commencing the action has prejudiced or may prejudice the defendant.

5. Mr O’Keefe says that the plaintiff/claimant did display reasonable diligence in the circumstances in commencing the action within subpara (a) and (correctly in my view) that prejudice to the defendant within subpara (b) was dealt with by me in my reasons at the time of the original decision, in which I held that such inevitable prejudice as the defendant may suffer in defending the plaintiff’s action brought out of time was not such as would significantly prejudice the chance of a fair trial of the action, for reasons given in my original decision which I shall not repeat.

6. Mr O’Keefe relies firstly on a decision in the Supreme Court of Queensland, King v Queensland Corrective Services Commission (No. 5221 of 1997, unreported, Mullins J) in which, without discussion, his Honour, after granting a plaintiff an extension of time under the Queensland legislation, eventually after submissions on the matter ordered that the costs of the application be costs in the cause. That is an indication, says Mr O’Keefe, that there is a general tendency in that direction in Queensland. It is notable that the facts of that decision do not disclose any particular lack of diligence on the plaintiff’s part or that of his solicitors: see particularly para [32] where his Honour refers to the fact that the plaintiff was relying on ignorance of the likelihood that traumatic stress disorder was likely to be a permanent injury, leaving him with chronic and lifelong disabilities, and so serious as to be likely to force him out of his work as a prison officer and endanger his future earning capacity. There are some differences between that situation and the present one, to say the least.

7. Mr O’Keefe secondly refers me to a decision in South Australia, Sola Optical Australia Pty Ltd v Mills (1987) 46 SASR 364. That decision must be treated with some caution because it relates to a different statutory test which was, as set out by King CJ at 372, whether the plaintiff/respondent’s conduct in seeking to have an application for extension of time determined as a preliminary issue amounted to "misconduct, or vexatious or oppressive conduct." Here no such test is in question, and indeed the parties agreed that I should consider the question of the application of the Queensland legislation in relation to the plaintiff’s entitlement to an extension of time as a preliminary matter, separately from the main action. Nevertheless the decision is of some guidance on the general discretionary questions I must determine as to the costs of this application, for after noting at 372 that the question of extension of time would not have arisen except for the default of the respondent/plaintiff or of a solicitor for whose omissions she was responsible, and that in resisting the extension of time the appellant/defendant was doing no more than to rest on the statutory bar to the action which existed unless and until an extension of time was granted, King CJ remarked at 373-3:

The costs incurred in obtaining the extension of time were incurred in consequence of the respondent’s initial default. The second consideration is that the costs of obtaining the extension of time should be viewed in the total context of the litigation. If it had not been disposed of as a preliminary point but had been canvassed at trial, and if the respondent had obtained the extension but failed in the action generally, it is unthinkable that the respondent would have been awarded the costs of the issue as to extension of time. I see no reason why the respondent should not receive the costs of that issue in any event simply because it was resolved as a preliminary point.

I think that the judge’s discretion as to costs miscarried. In my opinion the correct exercise of the discretion would be to make the costs of and incidental to the determination of the preliminary point, costs in the cause.

8. The trial judge’s determination of that issue had been that the defendant should pay the plaintiff’s costs of the plaintiff’s motion for extension of time. It seems to me that this decision is of some guidance in this case, because it indicates a tendency as to the costs of applications of this kind, even if brought on as a preliminary and separate matter in the context of the litigation generally, not to regard it as a prima facie rule that where a plaintiff has been guilty of some default, he or she should pay the defendant’s costs even if successful on that occasion for extension of time.

9. As against that tendency, Mr O’Keefe drew my attention to a decision against him, for which he is to be commended, Holt v Wynter (2000) 49 NSWLR 128, a case under the Motor Accidents Act, where at 147-8 at [121] Sheller JA said:

I set out hereunder the orders that I propose. In relation to costs ordinarily a successful applicant, who has allowed him or himself to get out of time, should pay the costs of the application unless the respondent’s opposition is wholly unreasonable.

10. That of course indicates a general predisposition to require a plaintiff in default to pay the costs of his or her application for extension of time, even if successful, both in relation to his or her own costs and that of the defendant.

11. It seems to me nevertheless that I must consider the provisions of s 39 of the Queensland legislation specifically as they apply by common consent to this case, and in particular ask myself whether reasonable diligence was shown in the circumstances by the plaintiff and by her attorneys, Messrs Slater and Gordon.

12. Ms Cheeseman unsurprisingly asserts that the plaintiff should pay the defendant’s costs of this motion, and she puts this on two bases. The first is that the plaintiff herself was not reasonably diligent, in that when she saw Messrs Slater and Gordon in the context of the Johns Manville litigation in circumstances set out in my earlier reasons, which I shall not repeat, she did not, as she should have done, provided them with a general retainer to advise her on her common law rights, but was rather content to give them a very specific written retainer, which was an exhibit in her application for extension of time, to advise her only in relation to the Johns Manville litigation. Ms Cheeseman’s second argument was that the plaintiff’s attorneys, Slater and Gordon, were in any event guilty of lack of reasonable diligence in failing to advise the plaintiff of her potential rights against the defendant she represents at the time she saw them in relation to the Johns Manville litigation.

13. She draws my attention on both points firstly to the fact that the plaintiff sought the Tribunal’s indulgence to have her limitation period extended, secondly to the fact that the necessity for the plaintiff to do that did not arise in any way out of, or was not attributable in any way to the conduct of the defendant she represents, and thirdly to the fact that, as indeed King CJ observed in Sola Optical as set out above, the defendant did no more than rely on a statutory bar upon which it was entitled to rest, subject to the plaintiff proving that she was entitled to an extension of it. Ms Cheeseman indicated that she too had located the authorities upon which Mr O’Keefe relied, and was unable to add to them except to refer to a brief extract from a Northern Territory decision, Henderson v Sauzier, the date and number of which and the identity of the judge who decided it not being apparent from the extract, I do not criticise Ms Cheeseman in any way as to that, I hasten to add, because she said she was unable to obtain any further details for technical reasons.

14. The principal aspect on which this extract is helpful is that it refers to what was said by Kirby P in Australian Postal Commission v Dao No. (2) (1986) 6 NSWLR 497. Kirby P indicated in that case that the discretion as to costs is very wide and not necessarily to be determined on the basis of which party succeeded in the litigation, at least as an overriding rule without exceptions.

15. The trend of authority in New South Wales in cases on the Limitation Act 1969 before the 1990 amendments which I researched and drew to the parties’ attention is by no means that a successful plaintiff should nevertheless pay the unsuccessful defendant’s costs on an application for extension of time. Generally, it would appear, costs followed the event. In Brunton v O’Bryan & Co Pty Ltd (1998) 4 NSWCCR 155 an unsuccessful plaintiff on appeal paid the defendant’s costs. In Broken Hill Pty Co Ltd v Waugh (1988) 4 NSWCCR 197 an unsuccessful defendant on appeal paid the plaintiff’s costs. In Dousi v Colgate Palmolive Pty Ltd (No. 2) (1989) 5 NSWCCR 86 an unsuccessful plaintiff paid the defendant’s costs of appeal. In Ditchburn v Seltsam Ltd (1989) 5 NSWCCR 235 a successful plaintiff on appeal received his costs from the defendant. In F J Walker Ltd v Webber (1989) 5 NSWCCR 266 an unsuccessful defendant on appeal paid the plaintiff’s costs. In Kyprinov v Cockatoo Dockyard Pty Ltd (1989) 5 NSWCCR 283 an unsuccessful plaintiff paid the defendant’s costs on appeal. In Francesco Cinzano and CIA (Australia ) Pty Ltd v Carnuccio (1990) 6 NSWCCR 189 a successful plaintiff received his costs from the unsuccessful defendant on appeal.

16. These cases were all in the Court of Appeal, but some indication of the earlier practice of this Tribunal at first instance when deciding applications under ss 57 and 58 of the Limitation Act 1969 (NSW), which are materially identical to the Queensland legislation, appears from Barron v James Hardie & Co Pty Ltd (1990) 6 NSWCCR 47 and Torrens v James Hardie & Co Pty Ltd (1990) 6 NSWCCR 89, where respectively a plaintiff succeeded in the application for extension of time in the Tribunal and O’Meally J ordered that costs be costs in the cause and the plaintiff failed in his application for extension of time in the Tribunal and O’Meally J ordered that the plaintiff pay the defendant’s costs. Thus the general trend in New South Wales has been by no means always to require a successful plaintiff to pay an unsuccessful defendant’s costs, and in my view it is appropriate on these authorities to examine the whole of the conduct of the parties in this litigation as disclosed by the evidence on the application for extension of time in exercising my discretion as to costs.

17. Another small indication that it may be appropriate to order the costs of an application for extension of time be costs in the cause is contained in Thelander v CD Townsend (Eng) Pty Ltd (1993) 32 NSWLR 358, a decision of the Court of Appeal after the 1991 amendments to the Limitation Act which I located and to which I also drew the attention of the parties, where indeed it was ordered, on an appeal by a successful plaintiff against the District Court’s refusal of an extension of time under the New South Wales legislation, that the plaintiff have his costs both of the appeal and in the original proceedings of the District Court. In that case, however, as with King’s case in Queensland, the question at issue was the plaintiff’s ignorance of the extent of his condition and no fault on his part or that of his solicitors was suggested, so this case is of limited guidance.

18. The question of costs is a difficult one in this case, because on the one hand, as Ms Cheeseman submits, the plaintiff would not be making her application, or at least would not be making it at the present time, were she informed at the time she saw Slater and Gordon at the time of the Johns Manville litigation that she may have rights against SIFC, the present defendant, or that by the commissioning of a suitable expert’s report she may ascertain the content of the duty of SIFC to provide her husband, the deceased, with a safe system of work, such as was eventually disclosed to her in the Stewart report, to which I referred extensively in my reasons on 14 December last. On the other hand, as Mr O’Keefe submits, to require Slater and Gordon to have advised, by way of reasonable diligence, that the plaintiff commence proceedings against the present defendant at the time she saw them in connection with the Johns Manville litigation is to require them to have launched the plaintiff on highly speculative litigation full of legal minefields, as was demonstrated by the fact that the litigation in Crimmins v SIFC (1999) 200 CLR 1 was ultimately determined in the plaintiff’s favour only by the High Court.

19. The evidence in this application suggests that the plaintiff is a person of relatively modest means, and to have required her to embark on litigation of the type commenced against the present defendant in Crimmins would be to have risked very considerable exposure to costs in the event of that litigation being regarded by the present defendant as an appropriate test case and ultimately failing at the highest appellate level. Even had the plaintiff been provided by Slater and Gordon, by qualification of an expert such as Mr Stewart, with an expert report indicating a practicable alternative systems of work available to the defendant at the time of the deceased’s employment in the Port of Brisbane, the question of the wisdom of suing the present defendant with the legal arguments involved would still have loomed large.

20. With considerable reluctance, I am of the view that within subparagraph (a) of s 39 of the Queensland legislation, the plaintiff and her attorneys both showed reasonable diligence in the circumstances in commencing this action. I say that firstly because of the fact that it was not reasonable in the view I have formed to expect Slater and Gordon to advise the plaintiff to commence proceedings against the present defendant with the attendant legal risks and consequent costs exposure.

21. Secondly, I consider that the plaintiff, being (as I found in my earlier reasons) a relatively unsophisticated person, and one who tended to trust her legal advisers and to place her affairs completely in their hands, was not unreasonable in retaining Slater and Gordon at the time of the Johns Manville litigation to advise her only in relation to that litigation, in the absence of any indication on their part that she may have wider rights against other potential defendants such as the present defendant, of whose existence she was not in my view then aware. I have dealt with why that was so in my original reasons and I shall not repeat what I said there.

22. With some reluctance, I have concluded that the appropriate course is to order that the costs of this application be costs in the cause. I have considered the whole of the conduct of the parties in this litigation, as disclosed by the evidence on the application from both parties. I have not referred above to the conduct of the defendant but I have not ignored it. For reasons I set out in my reasons on 14 December last, I consider that the defendant in this case has indeed been less than diligent, with due respect to it, in the preparation of its defence of the plaintiff’s actions. I shall not repeat what I said in my reasons on 14 December last about that, but it seems to me that in a context where the defendant has failed to take at least some steps reasonably open to it, that is a matter which should be placed in the balance against what is said to be the plaintiff’s default in failing to commence action in time in this case. As I have said, in any event and leaving aside the defendant’s conduct, I have concluded that within s 39 of the Queensland legislation the plaintiff showed reasonable diligence in the circumstances in commencing the action within subpara (a) thereof and so did her solicitors, although in the latter case my conclusion, as I have said, is reached with some reluctance.

23. For the reasons I have given I order that the costs of this application be costs in the cause.

Mr O’Keefe instructed by Slater & Gordon appeared for the plaintiff.

Ms Cheeseman instructed by Blake Dawson & Waldron appeared for the defendant.