Morocz v Marshman

[2015] NSWSC 612

Supreme Court

New South Wales

Medium Neutral Citation:	Morocz v Marshman [2015] NSWSC 612
Hearing dates:	On the papers
Date of orders:	29 May 2015
Decision date:	29 May 2015
Jurisdiction:	Common Law
Before:	Harrison J
Decision:	1.  Plaintiff to pay the defendant’s costs on an ordinary basis up to and including 4 November 2013. 2.  Plaintiff to pay the defendant’s costs on an indemnity basis from 5 November 2013. 3.  Direct the defendant to bring in short minutes of order to reflect these reasons within seven days.
Catchwords:	COSTS – indemnity costs – offer of compromise - cost consequences pursuant to UCPR 42.15A
Legislation Cited:	Uniform Civil Procedure Rules 2005
Cases Cited:	Morocz v Marshman [2015] NSWSC 325
Category:	Costs
Parties:	Maria Morocz (Plaintiff) Dr David Marshman (Defendant)
Representation:	Counsel: K Burke (Defendant) Solicitors: Terence Stern (Plaintiff) TressCox Lawyers (Defendant)
File Number(s):	2010/32578
Publication restriction:	Nil

Judgment

1. HIS HONOUR: I decided the principal issues in these proceedings on 17 April 2015: see Morocz v Marshman [2015] NSWSC 325. I dismissed the plaintiff’s claim with costs.

2. The defendant now applies for an order that his costs be paid on an indemnity basis from a date following the expiration of an offer of compromise made to the plaintiff. His contentions in that regard arise in the following circumstances.

3. The defendant’s offer of compromise was dated and made on 4 November 2013. It was in these terms:

“1. The defendant offers to settle and compromise the claim and action of the plaintiff against him, on the following terms:

(a) judgment in favour of the defendant: and

(b) no order as to costs.

2. This offer is open for acceptance for 28 days.

3. This offer is made in accordance with [UCPR 20.26].”

4. A letter that accompanied the offer of compromise explained the defendant’s opinion of the plaintiff’s claim and his view about her likely prospects of success. Part of what the letter contained is as follows:

“So that your client may understand the basis for our client’s offer, we confirm our client maintains your client will be unable to prove her action against the defendant, with respect to either breach of duty, causation or damages, for the following reasons:

1. your client will be unable to prove breach of duty; we have served evidence from peer professionals confirming that Dr Marshman acted in accordance with competent professional practice and that all appropriate warnings were given pre-operatively. To the extent there is any contest on the evidence with respect to breach of duty, we anticipate the Court will prefer our client’s evidence;

2. your client will be unable to prove both legal and medical causation. Your client sought out the surgical procedure and undertook her own research pre-operatively. No different warning would have caused the plaintiff not to proceed with the surgery;…

To the extent it may be necessary, we reserve our client’s rights to rely on this letter in support of any application for costs, including indemnity costs, in accordance with the principles in Calderbank v Calderbank…and s 131(2) of the Evidence Act.”

5. The plaintiff did not accept the defendant’s offer.

6. Following my decision in the principal proceedings, the defendant’s solicitor wrote to the plaintiff’s solicitor on 20 April 2015 referring specifically to the offer of compromise and foreshadowing the present application. The letter asked whether or not the plaintiff consented to the payment of his costs on an indemnity basis from 5 November 2013 pursuant to UCPR 42.15A (2) (b) (i). The letter in effect also proposed that the matter be listed before me for argument if the plaintiff was not prepared for me to make orders in chambers by consent.

7. The solicitor for the plaintiff indicated that he would seek instructions. In due course, by letter dated 12 May 2015, the plaintiff’s solicitor advised that the plaintiff did not consent to the defendant’s application for indemnity costs but had “no other submission to make in opposition.” The letter went on to indicate that “the plaintiff does not intend to appear on any argument on the matter.”

8. These factual matters are conveniently described in an affidavit affirmed on 13 May 2015 by Melinda Jane Conry, a solicitor having the daily conduct of the matter on behalf of the defendant.

9. Notwithstanding this state of affairs, I invited written submissions from the parties and indicated that I would defer considering the defendant’s application until a time specified for these to be provided had passed. That time has now passed. Only the defendant provided any submissions in accordance with my invitation.

10. The defendant submitted that the plaintiff did not obtain a better result in the proceedings than she would have achieved by accepting the offer. The offer complied with the provisions of UCPR 20.26 and attracted the costs consequences that arise pursuant to UCPR 42.15A. As a result, the Court is empowered to order that the plaintiff pay the defendant’s costs on an indemnity basis from the day after the offer was made and otherwise to pay his costs on an ordinary basis up to the date of the offer. In the circumstances the defendant sought the following orders:

1. Plaintiff to pay the defendant’s costs on an ordinary basis up to and including 4 November 2013.

2. Plaintiff to pay the defendant’s costs on an indemnity basis from 5 November 2013.

11. The plaintiff did not contend that the offer did not comply with the rules or that it was somehow invalid or ineffective. Nor did she submit that the offer was no more than a request to capitulate and therefore not a genuine offer of compromise. Indeed, as will be apparent, the plaintiff decided to take no part in the process of defending or responding to the defendant’s application in any way at all.

12. The plaintiff did not succeed in the proceedings because I was not satisfied that the defendant had failed in breach of his duty in accordance with applicable professional peer opinion at the time to warn her of any relevant risk or side effect of the procedure that she was contemplating. That outcome was alive in November 2013 as a significant possibility. Any other matters that I found the plaintiff had not been warned of, which she complained were matters of which she should have been warned, were in my opinion, having regard to the admissible expert medical evidence in the proceedings, neither risks nor side effects of which she should have been warned.

13. In my opinion the defendant is entitled to the special costs order that he seeks. I also consider that he is entitled to the costs of and incidental to the application itself. I direct the defendant to bring in short minutes of order to reflect these reasons within seven days.

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