Rajendran v The Heritage Council (No 2)

[2016] VSC 286

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

VALUATION, COMPENSATION AND PLANNING LIST

S CI 2015 01474

MARIA JOANNE RAJENDRAN	Plaintiff
v
THE HERITAGE COUNCIL	First Defendant
THE EXECUTIVE DIRECTOR EMPLOYED UNDER PART 2 OF THE HERITAGE ACT 1995 (VIC)	Second Defendant

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JUDGE:	GINNANE J
WHERE HELD:	Melbourne
DATE OF HEARING:	3 and 18 May 2016
DATE OF JUDGMENT:	18 May 2016 (Revised)
CASE MAY BE CITED AS:	Rajendran v The Heritage Council (No 2)
MEDIUM NEUTRAL CITATION:	[2016] VSC 286

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PRACTICE AND PROCEDURE – Litigation guardian – Plaintiff suffered serious illness while judgment reserved – Proceeding subsequently dismissed – Requirement to appoint a litigation guardian – Supreme Court (General Civil Procedure) Rules 2015 r 15.03.

COSTS – Whether plaintiff should pay successful defendant’s costs – Refusal of settlement offers – Refusal of offer – Whether indemnity costs should be ordered.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr C Porter	T J Mulvany & Co
For the Second Defendant	Mr B Jellis	Solicitor for the Department of Environment, Land, Water & Planning

HIS HONOUR:

1. I delivered judgment in this proceeding on 17 December 2015[1] and announced that the proceeding was dismissed. Counsel for the plaintiff informed me that his client had recently suffered a serious illness.

   [1]Rajendran v The Heritage Council [2015] VSC 732.

1. Accordingly, I made no orders but adjourned the proceeding until March this year to receive submissions as to the form of orders which should be made. Later, the parties submitted consent orders adjourning the proceeding until 3 May 2016 and on that day I heard argument about costs and the manner in which the plaintiff could be represented.

1. Tendered in evidence was a statement by Dr M Clark who stated that the plaintiff did not have the capacity to manage her own affairs as a result of a major health incident on 9 October 2015. Also tendered was an Enduring Power of Attorney in favour of Mrs Anashuya Lewis, a daughter of the plaintiff. The third document tendered in evidence was an order of the Victorian Civil and Administrative Tribunal (‘VCAT’) in its Guardianship List made by Senior Member Coghlan on 4 February 2016. The VCAT order was in the following terms:

The application for a guardianship and an administration order is dismissed.

The application for orders about an enduring Power of Attorney is dismissed.

The Tribunal notes that on 6 March 1997 Maria Joanne Rajendran appointed Anashuya Lewis to be her attorney under an enduring Power of Attorney.

The VCAT order also made directions for the provision of statements of account to particular persons.

1. After some discussion, I drew the parties’ attention to the need for the Court to appoint a litigation guardian under Rule 15.03 of the Supreme Court (General Civil Procedure) Rules 2015. The obvious person to be appointed as litigation guardian appeared to be Mrs Lewis. However, I considered that she should have a reasonable opportunity to consider the consequences of that appointment, not least in respect of her potential liability for costs, so I adjourned the proceeding until today for that purpose.

1. This morning, I have heard from counsel and from Mrs Lewis and have been provided with an affidavit by the plaintiff’s solicitor which established that Mrs Lewis understands the responsibilities that she would assume as litigation guardian.

1. I consider that the Rule requires me to appoint a litigation guardian and I therefore appoint Mrs Anashuya Lewis as litigation guardian of the plaintiff for this proceeding from today’s date.

1. The question of costs was also argued. I was taken to three offers of settlement. The need to appoint a litigation guardian may have affected the award of costs at least in respect of the second and third offers because the Court’s approval of any compromise would have been required. But as it has turned out, the second defendant, quite sensibly, did not continue to rely on the second and third offers which might have raised that issue.

1. The plaintiff herself, although unsuccessful, seeks an order that each party bear their own costs. She submitted through counsel that the second defendant had contributed to the costs of the proceeding by not developing a conservation management plan, not taking into account the need for the plaintiff to have reasonable use of the property and not taking into account the dereliction of the property.

1. In further written submissions, the plaintiff submitted that no cost orders should be made because:

(a) the defendants chose not to dispute any of the evidence relied on by the plaintiff, but relied instead on an unmeritorious technical argument, based on s 54 of the Heritage Act 1995; and

(b)   the second defendant’s first costs letter obscured the fact that, notwithstanding the willingness of the plaintiff to do so, the second defendant declined to enter into mediation which would have involved all issues, including costs.

The plaintiff submitted that it would, therefore, be inappropriate for the Court to make any order requiring the litigation guardian to pay any costs in person.

1. The second defendant, on the other hand, sought indemnity costs on the basis that the plaintiff had unreasonably refused to accept the first offer made in a letter of 28 May 2015. In that letter, the second defendant asserted that the plaintiff’s case disclosed no basis on which the Court could make the orders that she sought. The second defendant therefore invited the plaintiff to discontinue the proceeding, in which event the defendants would not seek an order for their costs.

1. The Court must consider whether the second defendant has established that the plaintiff’s refusal of the first offer was unreasonable. A number of factors which were summarised in Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2)[2] are often referred to. The onus is on the party making the offer to show that the refusal was unreasonable.

   [2](2005) 13 VR 435, 442.

1. I have taken into account the factors that are listed in Hazeldene’s Chicken Farm,[3] and conclude that the second defendant has not established that it was unreasonable for the plaintiff to refuse the first offer. The plaintiff had commenced judicial review proceedings which required consideration of detailed and somewhat complex issues. The fact that the Court ultimately decided the matter in what might be considered a clear cut manner, should not obscure the range of issues that the plaintiff is likely to have faced when deciding that she would commence the proceeding. While there was some compromise of costs in the second defendant’s offer, I do not consider that the plaintiff acted unreasonably in refusing it. I do not consider that the second defendant should receive costs on an indemnity basis.

[3]Ibid.

1. However, I do not accept the plaintiff’s submission that the second defendant should not receive an order for costs on a standard basis. A number of the matters that the plaintiff relied on to oppose the making of any costs order extend beyond the litigation and the issues raised it. In my judgment of 17 December 2015, I decided that there was no basis for an order in the nature of mandamus because the plaintiff had not followed the procedures required by the Heritage Act 1995 to obtain the removal of the property from the Heritage Register. In addition, I decided that no declaratory relief could be granted because no facts had been put forward to provide a basis any such declaration. The plaintiff did not succeed in obtaining the relief that she sought and the usual order is that costs follow the event on a standard basis.

1. The plaintiff has not established that the defendants, in particular the second defendant, conducted the proceeding in a manner that was not proper. Accordingly, the plaintiff, having been unsuccessful, must pay the second defendant’s costs on a standard basis.

1. The orders I propose to make are:

(a)   that Mrs Anashuya Lewis be appointed as the plaintiff’s litigation guardian for this proceeding as and from this date;

(b)   the proceeding is dismissed;

(c)        the plaintiff pay the second defendant’s costs of the proceeding incurred before the appointment of Mrs Lewis, as litigation guardian on a standard basis;

(d)  Mrs Lewis pay the second defendant’s costs of the proceeding incurred after her appointment as litigation guardian, if any, on a standard basis.

1. I will declare that the litigation guardian, Mrs Anashuya Lewis, is entitled to be indemnified in full by the plaintiff in respect of any costs for which she is liable as litigation guardian of the plaintiff to the second defendant.