Ramsey v Annesley College (No 2) - [2013] SASC 145

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Civil)
RAMSEY v ANNESLEY COLLEGE (NO 2)
[2013] SASC 145
Judgment of The Honourable Justice Blue
10 October 2013
PROCEDURE - MISCELLANEOUS PROCEDURAL MATTERS - DECLARATIONS
INTEREST - RECOVERABILITY OF INTEREST
PROCEDURE - COSTS - DEPARTING FROM THE GENERAL RULE - NATURE OF PROCEEDINGS - DAMAGES RECOVERED SMALL
PROCEDURE - COSTS - DEPARTING FROM THE GENERAL RULE - CONDUCT OF PARTIES - DEMAND, OFFER AND CONSENT
PROCEDURE - COSTS - TAXATION - PRINCIPLES OF TAXATION - UNSUCCESSFUL PARTY SUCCEEDING ON SOME ISSUES, COUNTERCLAIM OR CROSS ACTION - APPORTIONMENT
Ms Ramsey succeeded at trial in establishing that she was wrongfully dismissed by Annesley, damages being assessed at $47,081,95 for breach of contract.
The parties subsequently argued about grant of a declaration, interest and costs.
Held:
1.      Ms Ramsey is entitled to a declaration as a formal vindication by the Court that she was wrongfully dismissed and was not guilty of the misconduct alleged against her (at [9]-[10]).
2.      (a) The question of interest should not be approached in a micro-manner (at [21]).
(b)     Ms Ramsey should not be deprived of interest over the period from July 2011 to July 2012 (at [23]).
(c)     Ms Ramsey should not be deprived of interest on account of her rejection of Annesley’s offers (at [25]).
3. (a) The fact that Ms Ramsey sought (and obtained) a declaration did not entail the claim was not for “damages or other monetary relief” within the meaning of section 40 of the Supreme Court Act 1936 (SA) (at [31]).
(b) Section 40(2) and rule 263(2)(h) have prima facie application (at [32]).
(c) Due to the complexity of the matter, the profile of the parties and likely publicity, and the importance of vindication of Ms Ramsey’s character, it is an appropriate case to depart from the prima facie effect of section 40(2) (at [38]).
4.      (a) If an offer is expressed to be for principal relief and costs to be taxed, it does not “relate to costs” within the meaning of rule 187(3)(c) or to “principal relief and costs” within the meaning of rule 187(3)(d) (at [44]-[46]).
(b) Annesley’s first offer did not and its second offer did contravene rule 187(3)(d) (at [46] and [60]).
(c) The contravention comprised a procedural irregularity and under rule 12(1) was not void (at [61] and [62]).
5.      (a) “Principal relief” within the meaning of rule 188(6) includes a declaration (at [53]).
(b) Where the judgment of the Court includes relief which is not monetary but an offer is purely monetary, it is necessary to make a broad assessment of the value of the monetary and non-monetary relief compared to the terms of the offer (at [53])
(c) The combination of the declaration and judgment sum plus interest awarded in favour of Ms Ramsey was more favourable than Annesley’s offers (at [53] and [64]).
(d) If the principal relief granted had been no more favourable than Annesley’s offers, it would have been appropriate to make an order to the contrary (at [55] and [65]).
(e) Ms Ramsey should not be deprived of her costs on account of her rejection of Annesley’s offers (at [56] and [66]).
6.      (a) Ms Ramsey failed on several issues which were distinct from those on which she succeeded and in respect of which she had a weak case (at [71]).
(b) The time spent on the unsuccessful issues was approximately 30% of the total (at [72]-[73]).
(c) Ms Ramsey should recover from Annesley 70 per cent of her costs of action to be adjudicated (at [74]).
Fair Trading Act 1987 (SA) s 56; Supreme Court Act 1935 (SA) ss 30C, 40; Supreme Court Civil Rules 2006 (SA) rr 4, 12, 117, 187, 188, 263, 264, referred to.
John S Hayes & Associates Pty Limited v Kimberly-Clark Australia Pty Limited (1994) 52 FCR 201, applied.
Booth v Beresford (1993) 61 SASR 475; Brown & Brown v Unique Building Pty Ltd (No 2) [2009] SADC 18; (2009) LSJS 267, discussed.
Allianz Australia Insurance Ltd v National Jet Systems Pty Ltd [2004] SASC 438; (2005) 238 LSJS 93; Australian Education Union (SA) v Grieve [2000] SASC 430; Australian Trade Commission v Disktravel [2000] FCA 62; Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107; Scott v Williams (No 2) (2003) 225 LSJS 421; Warramunda Village Inc v Pryde [2001] FCA 61; (2001) 105 FCR 437; White v State of South Australia (No 2) [2010] SASC 185; (2010) 270 LSJS 264, considered.

RAMSEY v ANNESLEY COLLEGE (NO 2)
[2013] SASC 145
Civil:
BLUE J:

On 17 May 2013, I delivered reasons for judgment in this action.[1] I concluded that Ms Ramsey had been wrongly dismissed by Annesley and assessed damages at $47,081.95 for breach of contract.
[1] [2013] SASC 72.
On 30 May 2013, after hearing argument on whether I should grant a declaration, I pronounced judgment in the following terms:
1.     The Court declares that Ms Ramsey was not guilty of misconduct and Annesley College was not entitled to terminate her contract of        employment summarily.
2.     The defendant pay to the plaintiff damages assessed at $47,081.95.
3.     The quantum of interest to be awarded in respect of those damages is reserved for further consideration.
4.     All questions of costs are reserved for further consideration.
I subsequently heard argument on various issues relevant to interest and costs, in the course of which I made some interim rulings.
These reasons address all of the issues argued by the parties concerning grant of a declaration, interest and costs.
Declaration
In her statement of claim, Ms Ramsey sought a declaration that her dismissal was unlawful as well as damages, interest and costs.
In my principal reasons for judgment, I concluded that Ms Ramsey’s dismissal was unlawful in the sense that Annesley did not have any grounds justifying its purported summary termination of the employment contract.
In the action, Ms Ramsey contended that her wrongful dismissal had a negative impact upon her prospects of obtaining employment at other schools. Annesley disputed that, as a matter of law, Ms Ramsey could recover as a head of damage the value (if any) of her reduced opportunities of obtaining employment elsewhere in the teaching profession as a result of the circumstances surrounding her dismissal. I upheld Annesley’s contention in this respect. Annesley also contended that Ms Ramsey failed to prove that, but for Annesley’s breach, she would have had a valuable opportunity of obtaining appointments to positions the subject of her claim. I upheld Annesley’s contention in this respect also.
The grant of a declaration is a discretionary remedy. Declarations are not granted merely to express steps in the reasoning process of a court reaching its decision on substantive relief or unless there is a particular utility in making the declaration.[2]
[2] See, for example, Warramunda Village Inc v Pryde [2001] FCA 61; (2001) 105 FCR 437 at [8] and [12]-[13] per Gray, Branson and North JJ; Allianz Australia Insurance Ltd v National Jet Systems Pty Ltd [2004] SASC 438; (2005) 238 LSJS 93 at [59]-[63] per Anderson J (Doyle CJ and Duggan J agreeing).
Ms Ramsey is entitled to a declaration as a formal vindication by the Court that she was wrongfully dismissed and was not guilty of the misconduct alleged against her by Annesley as the ground for summary dismissal. She is entitled to have a formal declaration which she can show to a prospective employer or to any other person.
Annesley argued that a declaration should not be granted because my reasons for judgment achieved the same result for Ms Ramsey. Even if that were so, it would not be a reason not to grant a declaration. In addition, my reasons for judgment are necessarily long and complex and designed amongst other things to explain to the parties why I reached the conclusions which I did. They are not designed or apt to represent the formal declaration by the Court of the vindication of Ms Ramsey’s rights against Annesley.
Accordingly, I determined to grant the declaration in favour of Ms Ramsey.
Interest
Section 30C(1) of the Supreme Court Act 1935 (SA) (“the Act”) provides that, unless good cause is shown to the contrary, interest should be awarded on damages awarded in favour of a plaintiff.
Ms Ramsey was summarily dismissed on 19 March 2010. She instituted this action on 8 July 2010 and judgment was entered in her favour for damages of $47,081.95 on 30 May 2013.
The parties agreed that, subject to two issues which were argued, interest ought to be awarded to Ms Ramsey on the damages of $47,081.95 from 19 March 2010 to 30 May 2013 at 4 per cent above the cash rate published by the Reserve Bank of Australia. Subject to those two issues, the parties agreed that the amount awarded for interest should be $12,175.21.
The period July 2011 to July 2012
Annesley contends that Ms Ramsey should be deprived of interest on her damages for 12 months from July 2011 to July 2012 because the progress of the matter towards trial was delayed by the ulterior motive issue upon which she was ultimately unsuccessful.
In my reasons for judgment, I rejected Ms Ramsey’s ulterior motive case and found that financial considerations played no part in Annesley’s decision to dismiss her summarily.
Ms Ramsey applied in August 2011 for further and better disclosure of 11 categories of documents said to be relevant to her ulterior motive case. On 15 September 2011, Master Burley ordered that Annesley make further and better disclosure of five of the 11 categories sought.
After Annesley made further disclosure, Ms Ramsey brought a second application and on 21 December 2011 an order was made by consent for further and better disclosure by Annesley.
After Annesley made further disclosure, Ms Ramsey brought a third application and on 18 June 2012 an order was made by consent that Annesley make further and better disclosure. Annesley made its final disclosure on 2 July 2012.
While much of the activity over that period of 12 months was devoted to further and better disclosure, some of the time was also devoted to amendments to the pleadings and preparation of a tender book.
I reject Annesley’s contention. The question of interest should not be approached in the micro-manner contended by Annesley. On a broad based assessment, Ms Ramsey did not unreasonably delay in the prosecution of the action. She instituted the action promptly within four months of her dismissal and it came on for trial within 29 months of institution of the action. In general, it is inappropriate to micro-analyse periods before trial to determine whether time was spent on the pursuit of specific issues upon which a plaintiff ultimately fails at trial.
Ms Ramsey made three applications for further disclosure over the 12 month period in question. She was partially successful on her first application and Annesley agreed to make further disclosure in response to her second and third applications. She was entitled to pursue disclosure in respect of the financial motivation issue at the time and this is not affected retrospectively by her ultimate failure at trial on that issue.
Ms Ramsey should not be deprived of interest over the period from July 2011 to July 2012.
Interest after filed offers
Annesley contends that Ms Ramsey should be deprived of interest after 28 February 2011 or alternatively 24 October 2012 because she unreasonably rejected offers filed and served by Annesley.
Annesley did not cite any authority for the proposition that an unreasonable failure to accept a settlement offer can comprise good cause to deprive a successful plaintiff of interest thereafter. However, I do not need to decide that question because I conclude below that Ms Ramsey did not unreasonably reject the settlement offers.
Costs: Section 40 of the Act
Annesley contends that Ms Ramsey should be deprived of costs pursuant to section 40(2) of the Act and rule 263(2)(h) of the Supreme Court Civil Rules 2006 (SA) (“the Rules”) because the action was for the recovery of damages or other monetary sum and she recovered less than $75,000.
Section 40(2) of the Act provides:
(2) If—
(a)     an action for the recovery of damages or any other monetary sum is brought         in the court; and
(b)     the action might have been brought in the District Court; and
(c)     the plaintiff recovers less than an amount fixed by the rules for the purposes         of this paragraph,
no order for costs will be made in favour of the plaintiff unless the court is of the opinion that it is just, in the circumstances of the case, that the plaintiff should recover the whole or part of the costs of action.
Rule 263(2)(h) of the Rules provides:
(2) The general rule is, however, subject to specific rules to the contrary and also to the following exceptions (which apply subject to the Court’s order to the contrary) –
…
(h) in an action founded on a claim for damages or any other monetary sum (other than a motor accident claim or a claim for defamation), general costs of action are not to be awarded in favour of the successful plaintiff unless the amount awarded exceeds $75,000.
Ms Ramsey contends that, because she sought and obtained a declaration as well as damages, the action was not for the recovery of “damages or any other monetary sum” and in any event in the circumstances of the case the Court should make an order contrary to the prima facie effect of the Act and Rules.
Recovery of damages or other monetary relief
In Booth v Beresford,[3] the plaintiff sought and obtained a declaration that she was entitled to an equitable interest in a property owned by the defendant. She claimed that the equitable interest was to the extent of $79,750 but succeeded only to the extent of $7,500. Perry J held that her action was not for the recovery of “damages or any other monetary sum” within the meaning of section 40(2) of the Act.[4]
[3] (1993) 61 SASR 475.
[4] Ibid at 484 per Perry J.
Ms Ramsey did not have a proprietary claim or any other claim beyond a claim for damages. It is true that she sought and obtained a declaration that the summary dismissal was wrongful. While I have concluded that she is entitled to that declaration by way of vindication, the declaration in its terms does not extend beyond declaring that she was successful on liability, namely that Annesley acted in breach of contract. The mere fact that a party seeks a declaration does not in itself necessarily mean that the claim ceases to be for “damages or other monetary relief” within the meaning of section 40 of the Act.
I reject Ms Ramsey’s contention that section 40(2) of the Act and rule 263(2)(h) do not have prima facie application.
Exercise of discretion
The Court has a general discretion to depart from the prima facie effect of section 40(2) of the Act and rule 263(2)(h) of the Rules. Without fettering the breadth of the discretion, the following factors are relevant:
1.     the nature of the action;
2.     the complexity of the factual and legal issues;
3.     the profile of the parties and publicity associated with the matter;
4.     the amount recovered.[5]
[5]    Australian Education Union (SA) v Grieve [2000] SASC 430 at [12] per Williams J; White v State of South Australia (No 2) [2010] SASC 185; (2010)270 LSJS 264 at [13] and [18] per Anderson J.
The present action was both legally and factually complex. The action was assigned to the special classification list under rule 115 of the Rules on the basis that it was sufficiently complex to warrant a special classification. This was done without opposition by Annesley. The trial extended over 11 sitting days. Although Ms Ramsey was unsuccessful in her claims for damages for loss of opportunity to remain at Annesley or obtain work elsewhere in the education industry, her claims raised issues of legal complexity.
While the cause of action was for breach of contract, there are some analogies to a defamation action in that Ms Ramsey was seeking vindication of her character. Rule 263(2)(g) sets the level for a plaintiff being deprived of costs in an action founded on a claim for defamation at $25,000. This lower level reflects the importance of actions seeking vindication of character. It is appropriate to have some regard to the nature of the action in this regard.
Given the level of Ms Ramsey’s position at Annesley, it was always likely that the trial of the action would generate publicity. This transpired. The profile of the parties and the likelihood of publicity is a relevant factor.
Although the amount of damages and interest fell substantially short of the $75,000 threshold, it exceeded two thirds of that amount.
Weighing all of the circumstances, this is an appropriate case in which to exercise my discretion to otherwise order so that Ms Ramsey is not deprived of recovering her costs of action on account of the amount recovered.
Costs: first offer
On 14 February 2011, Annesley served on Ms Ramsey an offer filed under rule 187 of the Rules. The offer was in the following terms:
The Defendant OFFERS pursuant to Rule 187 to settle the action as follows:
1. By payment to the plaintiff in the sum of $60,000 (inclusive of interest) in addition to costs and disbursements to be agreed or taxed.[6]
[6] There was typographical error in the offer. It was typed with the closing parenthesis after the word “taxed” but Ms Ramsey accepted that it should be read with the closing parenthesis after the word “interest”.
Validity of offer
The material provisions of rules 187 and 188 are as follows:
187 – Offers of settlement
(1)     a party may, before the relevant date, file an offer of settlement in the Court (a     formal offer of settlement).
…
(3)     The offer must–
(a)     be in an approved form; and
(b)     if the offer relates to some, but not all, of the claims involved in the                   proceedings – state to which claims it relates; and
(c)     state whether the offer relates to costs and, if so, the amount of the offer so          far as it relates to costs; and
(d)     if the offer relates both to principal relief and costs–state whether the party          to whom the offer is made may accept the offer of principal without also            accepting the offer as to costs,
and a copy of the offer must be served on all other parties to the action.
188 – Consequences of filing offer of settlement in court
(1) A party to whom a formal offer of settlement is made may, before the relevant date –
(a)     accept the offer; or
(b)     if the offer relates to both the principal relief and costs and the offeror has           not indicated that the offer may only be accepted in its entirety–accept the         offer so far as it relates to principal relief.
…
(3)     The acceptance of a formal offer of settlement–
(a)     must be in an approved form; and
(b)     takes effect on the filing of the acceptance in the Court.
…
(5)     If a formal offer of settlement is accepted, judgment may be entered, by consent,    determining the relevant action or claim on a basis reflecting the terms of the offer.
(6)     If a formal offer of settlement so far as it relates to principal relief is not accepted by the party to whom the offer is made and the Court determines the relevant    action or claim on terms (as to principal relief) that are no more favourable to the       party than the terms of the offer, then, subject to the Court’s order to the contrary–
(a)     the party to whom the offer was made is not to be entitled to costs referable         to the period falling after the relevant date; and
(b)     the party that made the offer–
(i)    if a defendant–is entitled to costs referable to the period falling after                   the relevant date; and
(ii)     if a plaintiff–is entitled to the whole of the party’s costs of action on                   a solicitor/client basis and the defendant is not entitled to any costs not                 otherwise ordered.
…
(7)     In sub-rules (6) and (6A), the relevant date is the date falling 14 days after the     date of service of the offer.
(8)     If a formal offer of settlement in proceedings relating only to the adjudication       upon costs is not accepted by the party to whom the offer is made and the Court determines the proceedings on terms that are no more favourable to that party than    the terms of the offer, then, subject to the Court’s order to the contrary, the costs of     the adjudication upon costs are to be borne on a solicitor/client basis by that party.

Ms Ramsey contends that Annesley’s offer did not comply with rule 187(3)(d) because the offer related to “principal relief and costs” but did not state whether the offer as to principal could be accepted without also accepting the offer as to costs.
Rules 187 and 188 place considerable emphasis upon principal relief insofar as it is the subject of an offer of settlement. For example, rule 188(6) addresses only principal relief in defining the adverse cost consequences of non-acceptance of an offer.
Rules 187 and 188 proceed on the assumption that, if an offer is made addressing only principal relief, upon acceptance in accordance with the Rules, the plaintiff will ordinarily be entitled to party/party costs on the basis that the general rules are that costs follow the event[7] and are on a party/party basis.[8]
[7] See rule 263(1).
[8] See rule 264(2). It has been held that this is the position under Rule 40 of the Supreme Court Civil Rules 1987 (SA): Scott v Williams (No 2) (2003) 225 LSJS 421 at [51] per Lander J.
An offer only relates to costs, within the meaning of rules 187(3)(c) and (d) and 188(1)(b), if it stipulates something other than the defendant paying the plaintiff’s costs on a party/party basis. For example, if the offer is made on the basis that the plaintiff is not to receive any costs, is to receive less than 100 per cent of party/party costs, is to receive costs on a basis other than party/party costs or is to receive a fixed sum for costs, the offer “relates to costs”. In those events, rule 187(3)(d) requires the offeror to state whether the offer as to principal can be accepted without also accepting the offer as to costs. If the offeror so states and the offeree accepts the offer only as to principal, the issue of costs will be left to be decided by the Court if it cannot subsequently be agreed.
Even when the offer relates both to “principal relief and costs” within the meaning of rule 187(3)(d), the offer is not void if it does not state whether the offer can be accepted as to principal without also accepting the offer as to costs. Rather, the offeree will be entitled to accept the offer so far as it relates to principal relief pursuant to rule 188(1)(b) because of the lack of indication that the offer may only be accepted in its entirety.
If the offer is expressed to be for principal relief and costs to be taxed, it does not “relate to costs” within the meaning of rule 187(3)(c) or to “principal relief and costs” within the meaning of rule 187(3)(d). I agree with the construction of the rules to this effect adopted by Judge McIntyre in Brown & Brown v Unique Building Pty Ltd (No 2).[9]
[9] [2009] SADC 18; (2009) 261 LSJS 267 at [15]-[19] per Judge McIntyre.
Even if I had concluded that the offer contravened rule 187(3)(d), the contravention would comprise a “procedural irregularity” within the meaning of rule 4 because a filed offer is a step in a proceeding within the meaning of the definition of “proceeding” in rule 4. Under rule 12(1), the procedural irregularity would not render a step in the action void.
Finally, as there is no suggestion by Ms Ramsey that she was in any way prejudiced or affected by any non-compliance with rule 187(3)(d), if necessary I would have dispensed with compliance with that rule under rule 117(2)(a).
I reject Ms Ramsey’s contention that the offer was invalid.
Principal relief no more favourable
Rule 188(6) applies where:
… the Court determines the relevant action or claim on terms (as to principal relief) that are no more favourable to the party than the terms of the offer …
Annesley contends that the judgment sum together with interest calculated to 28 February 2011 (14 days after the offer) would have been $50,781.82, which is less than $60,000 being the amount of the offer.
Ms Ramsey contends that “the principal relief” within the meaning of rule 188(6) includes the declaration and the combination of the declaration and the judgment sum plus interest to 28 February 2011 was more favourable than the terms of the offer.
I accept Ms Ramsey’s contention. When the judgment of the Court includes relief which is not monetary in nature but the offer is purely monetary, it is necessary to make a broad assessment of the value of the monetary and non-monetary relief compared to the terms of the offer. The offer did not include a declaration nor any acceptance by Annesley that Ms Ramsey was not guilty of the misconduct which had been alleged against her as the basis for her dismissal. Annesley could have included a declaration in the offer or unequivocally retracted the allegations of misconduct which it had made. It chose to make a purely monetary offer. The combined value of the declaration and the monetary judgment was more favourable than $60,000.
Exercise of discretion
In John S Hayes & Associates Pty Limited v Kimberly-Clark Australia Pty Limited,[10] Hill J referred to the rules addressing a payment by a defendant into court. He said:
… if the payment into court is made without admission of liability and liability becomes an issue at the trial, the applicant may be entitled to costs if liability is found, notwithstanding that the damages suffered are less than the amount paid into court.[11]
Although that proposition is not applicable in the present case, it reflects a broader principle that a court should have regard to all of the circumstances in the exercise of the discretion as to costs.
[10] (1994) 52 FCR 201.
[11] Ibid at 204 per Hill J.
If I had concluded that the principal relief granted was no more favourable to Ms Ramsey that the terms of the offer, I would have exercised my discretion in her favour to make an order to the contrary of the effect of rule 188(6). The object of granting relief for breach of contract is to put, as far as possible, the innocent party back into the position in which he or she would have been but for the breach. A mere payment by Annesley of $60,000 was inadequate to return Ms Ramsey to that position. To do so required the addition of a declaration or acceptance by Annesley that Ms Ramsey had not been guilty of misconduct.
Ms Ramsey should not be deprived of her costs on account of her rejection of the February 2011 offer.
Costs: second offer
On 10 October 2012, Annesley filed and served a second offer in the following terms:
The Defendant, Annesley College OFFERS pursuant to Rule 187 to settle the action as follows:
1. To pay the plaintiff the sum of $100,000.00 (which sum is inclusive of interest) plus a further sum of $100,000.00 for the plaintiff’s party/party costs and disbursements.
This offer followed and was in response to an offer by Ms Ramsey dated 28 September 2012 (served on 4 October 2012) in which she offered to settle the action for $330,000 (inclusive of interest) plus costs and disbursements agreed at $100,000 or taxed.
Validity of offer
Ms Ramsey contends that the second offer did not comply with rule 187(3)(d) because it related to “principal relief and costs” but did not state whether the offer as to principal alone could be accepted.
The second offer included a fixed sum for costs. Annesley was therefore required by rule 187(3)(d) to state whether Ms Ramsey may accept the offer of principal without also accepting the offer as to costs. It did not do so.
However, the offer was not void for this non-compliance. Under rule 188(1)(b), Ms Ramsey could have accepted the offer as to principal without accepting the offer as to costs.
In any event, by reason of rule 12(1), non-compliance comprises a procedural irregularity which does not render the offer, being a step in the action, void.
Finally, in light of the fact that Ms Ramsey herself had quantified her costs at $100,000 within the previous two weeks and in the absence of any suggestion of prejudice, I would in any event have exercised my discretion under rule 117(2)(a) to dispense with compliance with rule 187(3)(d).
Principal relief not more favourable
Although the second offer involved payment of $100,000 which was $40,000 higher than the first offer, similar considerations apply to the second offer as to the first. For similar reasons to those given at [53] above, the ultimate determination of the action as to principal relief, taking into account the declaration as well as the monetary relief, was more favourable to Ms Ramsey than the terms of the offer.
Exercise of discretion
In any event, I would have exercised my discretion to make an order to the contrary under rule 188(6).
It follows that the rejection of the October 2012 offer by Ms Ramsey does not disentitle her to her costs.
Apportionment of costs
Ms Ramsey succeeded in her claim of breach of contract by Annesley’s summary termination without cause and recovered 12 weeks’ salary in lieu of notice and long service leave. However, she abandoned or failed on the following claims or heads of damage:
1. the causes of action of breach of duty of care and breach of section 56 of the Fair Trading Act 1987 (SA);
2.     the alleged complaints terms of the contract;
3.     the alleged breach of the mutual trust and confidence term in the conduct of the investigation;
4.     the ulterior financial motivation claim;
5.     the head of damage for loss of opportunity to remain at Annesley;
6.     the head of damage for loss of opportunity to work elsewhere in the     teaching profession; and
7.     the head of damage for distress.
There is some interrelationship between the claims and heads of damage on which Ms Ramsey failed. It is likely that she pursued the claims listed in items 1, 2, 3 and 4 in the hope that they would enhance her prospects of recovering the heads of damage identified in items 5, 6 and 7.
Annesley contends that Ms Ramsey should not recover 100 per cent of her party/party costs because of her failure on the above issues and instead there should be an apportionment of costs.
The question whether costs should be apportioned involves an assessment of all relevant circumstances, including:
1.     the degree to which the issues on which the plaintiff failed were distinct and severable;
2.     the proportion of costs incurred in respect of the issues on which the    plaintiff failed;
3.     the strength or merit of the claims on which the plaintiff failed; and
4.     the conduct generally of the plaintiff.[12]
[12] See Australian Trade Commission v Disktravel [2000] FCA 62 at [3] per French, Kiefel and Mansfield JJ; Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107 at [3]-[6] per Finkelstein and Gordon JJ.
In the present case, it is appropriate to make an apportionment of costs in respect of the issues pursued by Ms Ramsey on which she failed. They substantially increased the length of the trial. The additional liability issues pursued necessitated a detailed inquiry into Annesley’s conduct between November 2009 and March 2010 which would have been unnecessary if Ms Ramsey had only pursued the claim on which she succeeded that her own conduct was not in breach of contract. Ms Ramsey’s claims that Annesley proceeded unfairly and in breach of contract in its investigation and that Annesley was motivated by an ulterior financial motive were weak and unmeritorious. Her claims for damages for loss of opportunity were not justified by evidence led (regardless of their legal merit). The issues on which Ms Ramsey failed were quite distinct (involving Annesley’s conduct and different heads of damage) from those upon which she succeeded (involving her own conduct and the claim for direct loss). It would be unjust and inappropriate to require Annesley to pay Ms Ramsey’s costs insofar as they were incurred pursuing the unsuccessful issues.
The parties made submissions about the level of an appropriate apportionment, if costs were to be apportioned according to the issues upon which Ms Ramsey succeeded. Annesley contends that costs incurred at trial on unsuccessful issues (both in and outside court) represented 30 per cent of the total; whereas Ms Ramsey contends that they represented 20 per cent of the costs incurred in court and a negligible proportion outside court. My assessment is that approximately 30 per cent of the time during trial was devoted to issues upon which Ms Ramsey failed and this should be applied to time in and outside court.
Annesley contends that 70 per cent of the time spent before commencement of trial was devoted to issues on which Ms Ramsey failed; whereas Ms Ramsey contends that 20 per cent was spent on such issues. In the circumstances, it is appropriate to apply the same apportionment of 30 per cent to pre-trial costs as I have applied to trial costs.
The appropriate order is that Ms Ramsey recover 70 per cent of her costs of action.
Conclusion
Ms Ramsey is entitled to interest on damages of $12,175.21. Annesley should pay to Ms Ramsey 70 per cent of her costs of action to be adjudicated. I will hear the parties as to any consequential orders.