| JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : MULCAHY -v- MOTOR ACCIDENT COMMISSION OF SOUTH AUSTRALIA IN RIGHT OF BARRY WAYNE PAGE [2002] WADC 100 CORAM : DEANE DCJ HEARD : 20 APRIL, 15 JUNE & 14 AUGUST 2001 DELIVERED : 23 MAY 2002 FILE NO/S : CIV 894 of 1997 BETWEEN : BARRY JOHN MULCAHY Plaintiff
AND
MOTOR ACCIDENT COMMISSION OF SOUTH AUSTRALIA IN RIGHT OF BARRY WAYNE PAGE
Defendant
Catchwords: Personal injuries claim for damages arising out of a motor vehicle accident - Liability admitted - Assessment of damages only - Matter settled prior to trial - Whether special costs orders should be made as to certain items claimed in plaintiff's draft bill of costs - Whether matter unusually complex and/or whether there exists any other good or sufficient reason to make orders requested - Whether a direction should be made to the Taxing Officer to make an allowance for fees and expenses of accounting firm consulted by plaintiff in course of litigation.
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Legislation:
Rules of the District Court, O 5, r1
Rules of the Supreme Court, O 66, r 12(1)
Result: Application dismissed Representation:
Counsel:
Plaintiff : Mr D J Garnsworthy
Defendant : Mr J W Willers
Solicitors:
Plaintiff : Stables Scott
Defendant : Willers & Co
Case(s) referred to in judgment(s):
CAI Fences Pty Ltd v A Ravi Builders Pty Ltd & Anor, unreported; SCt of WA; Library No 8740; 26 February 1991
Cole v Western Australian Coastal Shipping Commission, unreported; DCt of WA; Library No 3248; 7 June 1991
Morris v Zanke (1997) 18 WAR 260
Retawil Pty Ltd v Olivetti Pty Ltd, unreported; SCt of WA; Library No BC9101159; 26 April 1991
Schmidt v Gilmore (1988) 2 WAR 219
Case(s) also cited:
D'Alessandro & D'Angelo v Bouloudas (1994) 10 WAR 194
Esther Investments Pty Ltd v Markalinga Pty Ltd (1992) 8 WAR 400
Friedman & Lurie v Barfield, unreported; SCt of WA; Library No 970651; 13 November 1996
Lewandowski & Ors v Lovell, unreported; SCt of WA; Library No 970651; 13 November 1996
McLean v Kerville, uneported; SCt of WA; Library No 6455; 1 October 1986
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1 DEANE DCJ: In this matter the plaintiff seeks the following orders as to costs;
1. The limits prescribed by the relevant determination of the Legal Costs Committee concerning: (a) getting up case for trial not apply; (b) fee on brief, being item 14(a) of the scale not apply; (c) attending pre-trial conference not apply. 2. A direction be made to the Taxing Officer to make a reasonable allowance for the fees and expenses of Bird Cameron Accountants in providing advice and reports for the conduct of the litigation on behalf of the plaintiff. 2 The plaintiff issued a claim for damages for personal injuries sustained in a motor vehicle accident on 31 May 1992. He was at the time engaged in the business of both intra and interstate haulage. On the date in question the plaintiff's truck was struck head-on by another prime mover on the Nullabor Plain but within the Western Australian border. As a result the plaintiff was seriously injured and taken to Kalgoorlie Hospital for treatment. By approximately mid March 1993 it became apparent that liability was not in issue and from about late May 1993 it also became apparent that liability by the plaintiff for contributory negligence was not in issue. Therefore from that point the only issue was quantum. A Writ of Summons was issued on 19 March 1997, some 4 years or so after these issues had been clarified and the matter was set down for an 8 day trial to assess damages, the issue being confined almost exclusively to the extent of the economic loss sustained by the plaintiff. 3 As I understand it there then followed two amendments to the pleadings, neither of which were of great significance and a minor amendment to the Writ of Summons. The plaintiff's application is not based on an argument that the pleadings were complex, but rather the claim that there was a need to carry out a detailed examination of the plaintiff's economic circumstances and history. Further and better particulars were not provided and the plaintiff consented to informal discovery by the defendant throughout the course of the action. 4 The action eventually settled for $447,233.60 exclusive of costs. There was some slight confusion regarding how this occurred, as counsel
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for the plaintiff seemed to be of the view that settlement occurred after an Order 24A offer was filed, whereas counsel for the defendant believed that the action settled pursuant to correspondence dated 5 October 2000 ("JMW22" annexed to the affidavit of Johan Maritz Willers dated 1 June 2001) being a without prejudice offer to settle. In any event liberty to apply was sought with respect to special orders as to costs and the terms of the order required an application to be made within 60 days. As a result of the urgency of the matter the plaintiff's first draft bill of costs was prepared, however the third and final version of that draft bill of costs and the one referred to in the course of these proceedings is annexed to the affidavit of Nicholas James Timoney sworn 12 April 2001. The plaintiff's bill of costs for taxation is lengthy and detailed. It is unnecessary in the context of this matter to conduct a minute examination of that bill, but it is helpful to refer to it to give an indication of the special orders sought relevant to particular items as compared to the amount allowed for such an item in the scale. 5 A special costs order of $22,634.70 is sought for giving discovery whilst the scale allows $1,800. The sum of $55,231 is claimed for getting up case for trial with reference to Schedules 2A and 2B. This comprises a counsel component of $7,015 and a general component of $48,216. The scale allows for an amount of $20,250. An amount of $7,750 is claimed for fee on brief (part) whereas the scale allows $6,900. An amount of $2,257.50 is claimed for attending pre-trial conference whereas the scale allows an amount of $750. There are also a number of disbursements where an amount in excess of the prescribed fee is claimed. 6 After some argument counsel most helpfully presented the Court at the resumed hearings with a document prepared as I understand it by agreement, indicating the plaintiff's schedule of adjusted schedule totals in the light of, and taking into consideration, certain matters raised in the defendant's outline of submissions. Counsel for the plaintiff made it clear that the presentation of such a document did not indicate any concessions on the part of the plaintiff, but rather it was to assist the Court should the Court be minded to accept any of those particular submissions raised on behalf of the defendant and reflected in the document. This document is reproduced below, taking into account one amendment where the figure of $14,000 was inserted in lieu of the figure of $29,133.
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Schedule of Adjusted Schedule Totals From 'Defendants Outline of Submissions' | Paragraph | Schedule | Details | Total | Reduced | Resulting Schedule Total | Resulting Getting Up Total | Scale Allowance | 21 | 1 | Discovery | $22,634.70 | $6,843.20 | 22 | 1 | Discovery | $15,791.50 | $2,450.00 | $14,000.00 approx | $1,800.00 | 23 | 2B | Getting Up | $48,216.00 | $1,107.00 | 24 | 2B | Getting Up | $47,109.00 | $3,402.00 | 25 | 2A | Counsel Component - getting up | $7,015.00 | $6,115.00 | $ 900.00 | $900.00 | 26 | 2B | Getting Up | $43,707.00 | $2,106.00 | $132,417.00 | $132,417.00 | $20,250.00 | | TOTAL | $184,473.20 | $22,023.20 | $162,450.00 | $133,317.00 | 7 Pursuant to O 66, r 12(1) of the Rules of the Supreme Court, the Court has a discretion to make special orders as to costs. The determination of the Legal Costs Committee of 1 July 1999 concerning the Supreme and District Courts confirms the jurisdiction to do so. In considering whether or not to exercise its discretion to make special orders as to costs the Court may act on a determination as to whether all or any of three criteria set out in the rule has been satisfied; (1) the unusual complexity of the case: Retawil Pty Ltd v Olivetti Pty Ltd, unreported; SCt of WA; Library No BC9101159; 26 April 1991 (2) the importance of the case relevant to any issues of public interest: Cole v Western Australian Coastal Shipping Commission, unreported; DCt of WA; Registrar Kingsley; Library No 3248; 7 June 1991. 3. Any other good or sufficient reason. This can include the amount of work properly falling within a claim for getting up for trial; CAI Fences Pty Ltd v A Ravi Builders Pty Ltd & Anor, unreported; SCt of WA;
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8 In considering whether a special costs order should be made on the basis of the amount of work done the Court is entitled to consider a range of matters including; (a) whether or not the additional work was done; (b) whether that work was necessarily or reasonably done; (c) whether the fees proposed are reasonable; (d) whether an inadequacy exists in the scale; and (e) the principle that a successful party should recover costs reasonably and properly incurred. 9 From the outset counsel for the plaintiff stressed that the Court was not being asked to make an order that the amounts claimed in the draft bill of costs be allowed, but rather the application focused on consideration of whether to allow the taxing officer to fully and substantially consider the claims made by the plaintiff with respect to the costs that it submits have been incurred. If the plaintiff's application were successful that could not of course be construed as this Court giving approval to the particular amounts claimed, as that is a matter within the province of the taxing officer, who retains a discretion to disallow part of any amount claimed. 10 It is common ground that the issues of liability and the plaintiff's contributory negligence were resolved early in the proceedings, and further, counsel for the plaintiff conceded that the complexity of a matter alone is insufficient to satisfy this criteria in the sense that there must be a factor or factors present which distinguish a matter from the norm or even a complex claim for damages for personal injuries. In this regard counsel for the plaintiff pointed to Mr Willers' affidavit of 9 April 2001 containing Annexure "JMW14" (at p 32). That is a copy of a letter from Mr Willers
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to the plaintiff's solicitors dated 22 November 1999. It points out that the plaintiff had not to that point in time complied with O 5, r 1 of the District Court Rules and foreshadowed an adjournment of the pending pre-trial conference if the matter was not resolved. In part the letter refers to this action describing it as a complex and substantial matter. In my view that comment must be read in context given that apparently there were a considerable number of issues involved and the pre-trial conference was listed for 25 November 1999. I do not think that this comment can properly be interpreted as a concession on the part of the defendant's legal advisers that this matter is one of unusual complexity. 11 Counsel for the plaintiff submitted that the unusual complexity arising in this case was not so much a consideration and determination of the nature of the plaintiff's injuries but rather the impact that such injuries would have upon the plaintiff's economic circumstances following the accident and taking into account his economic history and circumstances preceding it. It was argued that a further complication which added to the complexity of the matter was the unusual situation whereby the plaintiff's recovery was better and more rapid than had initially been expected, although the plaintiff did not recover to the extent whereby he was able to conduct that part of his business which involved interstate truck driving between Western Australia and Queensland. He retained some capacity though it was not unlimited, to continue driving some intrastate routes within Western Australia. 12 Whilst counsel for the defendant accepted that where a plaintiff is self-employed or conducts a business through a company, the quantification of economic loss in a personal injuries claim can give rise to complexity, it was said this was not such a situation because with reference to the plaintiff's book of expert accountant's reports it was apparent that the plaintiff's business relevant to both inter and intrastate haulage was well established as at the date of the accident, and that his business arrangements and economic situation was in no way complicated. The plaintiff's wife drew a fixed salary from her husband's business, and although the plaintiff and his wife jointly owned a restaurant business, it was in no way connected with the plaintiff's transport business and he did not derive income from the restaurant. 13 It appears that the plaintiff employed substitute labour for just over one year in order to maintain the interstate haulage aspect of the business, although as I understand it, there was a dispute between the parties as to the reason for that route eventually ceasing. The plaintiff took the position that the interstate routes were the more lucrative part of the
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business, whereas it was the defendant's view that as a result of the operation of a variety of factors, those routes were no longer particularly profitable and that in turn rendered it unnecessary to continuously assess and monitor the progress of the business in the context of the plaintiff's duty to mitigate his damages. 14 The defendant, as it was entitled to do, put the plaintiff to proof on each aspect of the claim for economic loss with the result that the plaintiff's legal advisers then had to examine and discover a considerable amount of documentation relevant to the conduct and activity of the plaintiff's business for a period spanning approximately 10 years, reflecting the period of time before the accident in 1992 and the period after the accident until the year 2000 when the case was settled. I accept that it may be case that the amount of material discovered and the number of reports prepared and discovered prior to litigation, as well as the nature and number of affidavits filed and the detail of submissions made, can all be indicative of the complexity and even the unusual complexity of a matter. On the other hand I consider it rather too simplistic to take this as always being the case and therefore it is necessary to go behind such matters in order to ascertain whether such activity was really necessary and truly warranted. Similarly, it may be the case that the amount of work done is of itself strongly suggestive of the proposition that the matter is of an unduly complex nature, but again one has to be wary of accepting such a proposition at face value. 15 Neither of the expert accountant's reports for either the plaintiff or defendant are particularly lengthy and I accept the submission on behalf of the defendant that in the context of a case such as this, it is not surprising that the plaintiff's legal advisers considered it both necessary and prudent to further investigate the plaintiff's position regarding his claim for economic loss, by consulting with witnesses relevant to the transport industry in which the plaintiff was engaged. In the context of this case furthermore, I cannot see that the accounting review of the plaintiff's accounting records between 1991 and 1993 conducted on behalf of the defendant contributed in any substantial way to the complexity of this matter. It is not uncommon for this type of investigation to be undertaken by parties relevant to a claim for damages arising out of personal injury in actions before this Court. 16 In part the plaintiff seeks an order that the taxing officer make a reasonable allowance for the fees and expenses of Bird Cameron Accountants relating to advice and reports prepared relevant to the conduct of the litigation. There is however no material before this Court
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as to what those costs are and no particular or specific argument is advanced to demonstrate that such costs were reasonable in the circumstances. Counsel for the plaintiff concedes that this is so, but merely invites the Court to require the taxing officer to consider making such an allowance which does not preclude the defendant raising objections and argument as to the reasonableness or otherwise of such costs. The difficulty I perceive however, is that this Court finds itself in a position of possessing no real or firm information which might persuade it that the making of such an order is appropriate even if ultimately the decision is to be that of the taxing officer. In that sense it might be described as consideration of the making of an order in something of a vacuum and this is undesirable. 17 I accept as counsel for the plaintiff submitted that where it is necessary to examine the operation of a business and its profitability or otherwise, relevant to the assessment of economic loss, then to the extent that the loss may be demonstrated into the future a projection of the business itself as to its future performance will be required in many instances in order for a court to properly assess damages; Morris v Zanke (1997) 18 WAR 260. In some, though not all instances, this may be a task which legal advisers are not appropriately equipped to undertake and for that reason it will on occasion be necessary to engage expert accountants. The fact is, however, that such persons are most able to deal with such matters without generally finding the task unduly or unusually complex. On the material before this Court, and considering the nature of the plaintiff's business and his general economic circumstances, it does not appear although the task facing the accountants in this matter involved material extending over a period of years, that the essence of what they were required to do was unusual or particularly complicated. The fact that the defendant's legal advisers engaged their own economic and accounting experts does not of itself suggest or confirm that the question of calculation of economic loss was unduly complex. On the available material I cannot make a determination as to whether this matter is inextricably linked to the costs of getting up. 18 There is no issue that the plaintiff had a legal duty to provide ongoing discovery of all relevant documentation, including source accounting documents and there appears to be no debate that as a result a considerable volume of documents were involved in the process. That again in the context of litigation of matters of this nature is not unusual and indeed it would seem to be the norm, where a business is involved. I am not persuaded that the contents of par 3 of the affidavit of Nicholas Timoney sworn 15 November 2000 distinguishes the extent of discovery
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in this case to the point where it could be described as either unique or unduly complex. That view is not altered by further consideration of the contents of the affidavit of Nicholas Timoney sworn 20 October 2000 which refers in part to the factors underlying the submission that it is appropriate for the Court to make special orders as to costs in this matter. As I understand it there was some delay by the plaintiff's legal advisers in completing discovery but at the end of the day I cannot see that this unduly impacts on the matter, in the sense that I cannot see that it renders discovery unusually complex or difficult. 19 I accept the argument raised by counsel for the defendant that one can discover material such as source accounting documents in identifiable and readily ascertainable bundles and this would in the end render the task less time consuming. Whilst it is necessary in the end for a solicitor to become involved in the discovery process by way of making decisions as to admissibility and relevance of documents and possible claims of privilege, it is nonetheless the case that in many instances the task can be considerably assisted and time saved by the involvement of a suitably trained clerk or paralegal. 20 Relevant to the anticipated trial, a total of 31 medical reports were collated and filed on behalf of the plaintiff. These ranged in dates from June 1992 up until September 2000. Whilst some of the reports were one or two pages in length others ran to three or four pages. The longest was a six page report compiled by Dr Bell in July 1995. Again it is not unusual in matters of this nature that it is incumbent upon the plaintiff to file materials by way of medical reports clearly detailing the plaintiff's medical condition and outlining its progression over time and the prognosis for the future. I accept that thirty one medical reports comprise a reasonable number of documents, but once more, I am not persuaded the amount is so voluminous, or the contents so complicated, that this would have involved the plaintiff's legal advisers in an unusually complex exercise. Further, it has been conceded by counsel for the plaintiff that ultimately the plaintiff's injuries were not the main focus of attention as fortunately he made a better than expected recovery. It is often the case that in damages claims of this nature the plaintiff is reviewed by a considerable number of medical practitioners and this can occur with reasonable frequency over an extended period of time and so in that sense the number and nature of these reports do not vary in any appreciable way from what might be described as the norm. The requirement or need for a number of reviews by various medical practitioners is not surprising in this mater as there was a period of some 8 years between the accident and settlement of the claim.
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21 In the course of these reasons I do not consider that it is either necessary or appropriate to engage in mathematical calculations whereby the Court comments on whether particular charge out rates for the time allocated are reasonable or acceptable or whether, for example, a total of 9.3 days spent in getting up for a trial listed for 8 days is reasonable or appropriate. I do not believe in any event that this matter can be resolved by resorting to pure mathematical calculations. It is certainly the case that in the plaintiff's draft bill of costs where special costs orders are sought, the difference between the amount claimed for particular items and the allowance permitted by the scale is considerable. That difference alone however does not of itself demonstrate that there is an inadequacy in the scale. The difference may be accounted for in other ways.
22 The plaintiff's claim for special orders as to costs incorporates counsel's fees, where it is argued that counsel's involvement was essential to the proper conduct and resolution of the proceedings. Counsel's fees must be taken into account within the relevant scale and not as an addition, for example, as a disbursement. I accept that the Court in exercising its discretion in making special costs orders can take account of the impact of the contribution by counsel to the litigation. There is some confusion as to this aspect of the matter so far as I am able to understand it. It would appear from Schedule 2A that all the attendances from 27 September 2000 to 2 October 2000 (relevant to the counsel component for getting up) relate to services rendered by the junior counsel, when the services rendered by senior counsel for the plaintiff during the same period relate to getting up and to attendances identical to those of the junior counsel for settling witness statements. It would appear according to submissions made on behalf of the defendant, that for services rendered on 27 September 2000 the plaintiff's legal advisers seek costs amounting to $5,661 which involve on its face a somewhat unnecessary duplication of services on the part of counsel and the instructing solicitor. It is not at all clear whether for the period in excess of 6 hours both counsel were attending particular meetings relevant to obtaining or settling proofs of evidence. 23 In this portion of these reasons I do not mean to suggest that whether or not services rendered on a particular day were excessive is a matter for the Court, but nonetheless the Court has to be persuaded that it is appropriate to make a special order in the first instance and there has to be some material before it to enable the Court to be properly informed so as to make such a decision. Counsel's fee note of 11 October 2000 which is annexed to the affidavit of Nicholas Timoney sworn 20 October 2000 refers to additional services carried out with respect to the pre-conference
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(being the first of two pre-trial conferences) which was held on 25 November 1999. It was the intention as I understand it from the affidavit, that senior counsel who was in fact the counsel at trial also attend as counsel at that pre-trial conference. It would appear from the schedule with respect to the pre-trial conferences, which is annexed to Nicholas Timoney's affidavit of 12 April 2001, that the majority of the attendances refer to matters such as obtaining instructions from the client, reviewing the file, preparing documents for the pre-trial conference and conferring with counsel relevant to quantifying the plaintiff's claim. 24 Counsel for the defendant raises the question of whether or not such matters are contemplated by item 24 of the schedule to the 1999 determination of the Legal Costs Committee and submits that they are not. In any event as I understand it the matter did not settle on that occasion but the pre-trial conference went for approximately one hour before being adjourned to a further pre-trial conference and listing conference. Clearly, I am guided by the information provided to me by counsel for the defendant relevant to this aspect of the matter and I do not understand that aspect of what he put before the Court to be in dispute. It would not appear in any event that a special costs order is sought in relation to this item, being item 14 on the plaintiff's draft bill of costs, but nonetheless it is appropriate to refer to it as part of the general background to this matter as it concerns pre-trial conferences. 25 A further pre-trial conference was held on 8 February 2000, at which junior counsel rather than senior counsel attended. A special costs order in the amount of $2,257.50 is sought in relation to this item on the draft bill of costs. Clearly the amount claimed is considerably in excess of the $750 allowed in the relevant scale. Once again I must be guided by what I am told about that particular event. Counsel for the defendant asserted in his submissions that nothing of unusual complexity or out of the ordinary transpired during the course of that pre-trial conference which lasted for approximately 3½ hours. 26 Counsel for the plaintiff makes the point, which is not disputed, that if a taxation occurs in the absence of a special order as to costs a 25 per cent discount will apply in any event to the allowance for getting up because liability was not in issue. This discount applies to both fees of the instructing solicitor and counsel, reducing the ceiling by $6,500 in any event. This cannot however, be determinative of whether a relevant special costs order should be made. A similar comment can be made in relation to the fact that the limit on the scale for getting up is reduced by the same amount on the same basis.
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27 I have carefully considered the very detailed and comprehensive arguments advanced by both counsel for the plaintiff and counsel for the defendant in this matter. In all of the circumstances I am not persuaded that this case was of unusual complexity. Stress must be placed on the concept of "unusual" as distinct from complexity because the assessment of damages did raise some issues that would not properly be described as entirely straight forward or simple. Nor am I persuaded that there is any other good or sufficient reason for the orders sought as to costs or the directions sought to the taxing officer be made. The fact that in a number of instances there is a very considerable difference between the amount allowed by the scale and the amount sought by way of a special order as to costs does not of itself demonstrate that an inadequacy necessarily exists in the scale.
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