(re Rowley) the University of Adelaide v BI (Contracting) Pty Limited
[2007] NSWDDT 3
•30 May 2007
Dust Diseases Tribunal
of New South Wales
CITATION: (re Rowley) The University of Adelaide v BI (Contracting) Pty Limited [2007] NSWDDT 3 PARTIES: The University of Adelaide
BI (Contracting) Pty LimitedMATTER NUMBER(S): 73/2003/CC1 of JUDGMENT OF: Kearns J CATCHWORDS: Dust Diseases Tribunal :- contribution recoverable by one tortfeasor from another
extends to plaintiff's costs of conducting litigation against tortfeasor
method of determining those costs in contribution action where plaintiff and tortfeasor have agreed on the amount.LEGISLATION CITED: Wrongs Act of South Australia
Law Reform (Miscellaneous Provisions) Act 1946
Legal Practitioners Act 1987CASES CITED: James Hardie & Coy Pty Limited v Wyong Shire Council (2000) 48 NSWLR 679;
Bitumen & Oil Refineries (Australia) Limited v Commissioner for Government Transport (1955) 92 CLR 200;
Bakker v Joppich & Bitumax Pty Limited (1980) 25 SASR 468;
Saccardo Constructions Pty Limited v Gammon (No.2) (1994) 63 SASR 333;
In Marriage of Aldous (1996) 135 FLR 326EX TEMPORE JUDGMENT DATE: 30 May 2007 LEGAL REPRESENTATIVES: Mr J Sheller instructed by Thompson Cooper appeared for the cross claimant
Mr T G R Parker instructed by Makinson & D'Apice appeared for the cross defendant
JUDGMENT:
Matter No. DDT00073/2003/CC1
(re Derrick Rowley, Plaintiff)
The University of Adelaide
(Cross Claimant)
v
BI (Contracting) Pty Limited
(Cross Defendant)
JUDGMENT
KEARNS J
1. In this matter I delivered reasons for judgment on 5 April 2007, then I found that the University was entitled to a contribution from the cross-defendant BI (Contracting) Pty Limited under section 25 of the Wrongs Act of South Australia. I assessed that contribution at 35 per cent of the damages that the University was required to pay to Professor Rowley. It left to be considered later whether the University was entitled to recover from BIC a contribution towards the costs it paid to Professor Rowley.
2. Mr Sheller puts the case for contribution on three bases. (1) There was sufficient in the materials I had before I delivered my reasons on 5 April 2007 to have found that the University was entitled to a contribution of 35 per cent of the amount of the costs that it paid to Professor Rowley; (2) in the alternative, the University should have leave to reopen its case to prove its entitlement and upon such leave being granted it has put before me sufficient evidentiary material for me to make a finding that it is entitled to a contribution of 35 per cent of the amount of the costs it paid to Professor Rowley. Thirdly, further in the alternative, it is entitled to a contribution to its costs and if I am not satisfied as to the first two alternatives I may determine the amount of costs to which the contribution of 35 per cent may be applied.
3. As to the first basis, Mr Sheller has referred me to a number of authorities, none of which was referred to when the proceedings were before me earlier. Mr Sheller commenced with James Hardie & Coy Pty Limited v Wyong Shire Council (2000) 48 NSWLR 670. There it was held that an amount a tortfeasor may recover from another tortfeasor in a contribution action under section 5 of the Law Reform (Miscellaneous) Provisions Act 1946 extends to costs recoverable by the plaintiff. This much is not contentious. There is no relevant difference between the South Australian Wrongs Act and the New South Wales Law Reform (Miscellaneous) Provisions Act 1946.
4. Mr Sheller next drew on Bitumen & Oil Refineries (Australia) Limited v Commissioner for Government Transport (1955) 92 CLR 200 for a couple of points. The first is that under the contribution legislation the Court hearing the contribution claim must accept as conclusive the assessment made in the proceedings brought by the injured person against the tortfeasor from whom he recovered. This is as to the existence of the tortfeasor's liability to the plaintiff and the amount of that liability. This extends also to an assessment by way of a consent judgment. If, however, in the original assessment or consent judgment there has been, for example, negligent conduct in the litigation, resulting in an excessive amount being incurred, the Court may examine that under the requirement to examine what is just and reasonable. Again this is not contentious.
5. Mr Sheller then took me to Bakker v Joppich & Bitumax Pty Limited (1980) 25 SASR 468. There Wells J held that a consent judgment provides a proper basis for an apportionment of what is just and equitable, even if the Court hearing the matter might come to a different figure to that in the consent judgment (474-5). The matter would be different if the sum agreed were improper or unreasonable (475). Again, this is not contentious. I was then referred to Saccardo Constructions v Gammon (No. 2) (1994) 63 SASR 333. There King CJ set out some propositions applicable, where a defendant seeks a contribution from a tortfeasor towards its liability to a consent judgment.
6. Those propositions were as follows:
(1) The test as to whether the defendant can recover on the basis of the full amount of the consent judgment is the reasonableness of the settlement figure in the consent judgment.
(2) There is no presumption of law that the settlement was reasonable. The onus as to reasonableness therefore lies with the party seeking to establish it.
(3) The fact of the settlement is some evidence of its reasonableness.
(4) The circumstances in which the settlement was arrived at and any proper inferences therefrom may be evidence as to the reasonableness of the settlement.
7. Again I would not understand that to be contentious. Saccardo was applied in In Marriage of Aldous (1996) 135 FLR 326.
8. Mr Sheller argues that the principles from these cases apply as much to costs a defendant is required to pay to a plaintiff as they do to the damages a defendant is required to pay to a plaintiff. It is at this point that the parties clash. Mr Parker SC argues that the authorities on which Mr Sheller relies go to the question of reasonableness which is relevant to a determination of what is just and equitable. There is, however, he argues, a threshold question and that is a liability question. Before one can get to the reasonableness or the just and equitable question in this case the University must first have been liable to Professor Rowley for costs and BIC does not accept that it was. This liability fact needs to be proved like any other fact.
9. I am against BIC's submission on this liability point for reasons I set out hereunder. BIC's argument runs that the University has to show that Professor Rowley was liable to his solicitors, Turner Freeman, for costs. Because of the operation of the indemnity principle in relation to costs and in the absence of a costs agreement between Professor Rowley and Turner Freeman, the University has not shown that Professor Rowley was liable to his solicitors for costs. I do not accept this argument. The absence of a costs agreement between Professor Rowley and his solicitors would not mean that Professor Rowley was not liable to his solicitors for costs. The failure to make appropriate disclosure to a client does not mean that the client is not liable in costs to his solicitor. It means the solicitor is required to have the costs assessed. This is provided for in section 182 of the Legal Practitioners Act (1987) which was the legislation in place at the time. There is an equivalent section in the current Legal Practitioners Act.
10. The only way it seems to me that Professor Rowley would not have been liable to his solicitors for costs would be if the solicitors agreed to undertake his case for no reward. That position is so unlikely that I reject it. The result of this is that Professor Rowley was liable to his solicitors for costs. The indemnity principle would not affect that. That would go only to the quantum of the costs. The result of this process of reasoning is that I think that this makes applicable the authorities to which Mr Sheller referred me. In my view, therefore, Professor Rowley was liable to his solicitors for costs in conducting his case against the University and those costs form a proper basis for an assessment of what is just and equitable under the legislation.
11. The question remains what those costs were. The University has tendered evidence on this point. The evidence was tendered on an application for leave to reopen if it became necessary to do so. It was, in effect, left to the Tribunal to determine whether it was necessary for the University to reopen. I consider that it was necessary. It was argued that I had sufficient material without the material tendered on the reopening to find that $120,000 was a reasonable figure for costs or to enable me to make an assessment myself. I think I could have made an assessment myself in terms of being empowered to do so. It seems to have been acknowledged that I could do so although Mr Parker SC argued I should not. The problem I would have had is that the decision would not have been an informed one as assessment of costs was not an area of practice for me. Had I been forced to make a decision myself, there is a real likelihood that I may have assessed a figure other than $120,000.
12. The other point of the University's argument, namely, that I had sufficient material to find that $120,000 was a reasonable figure, suffers from the problem I have just explained. There is no doubt that Professor Rowley's case was a difficult one, especially on liability. That was amply demonstrated by the conduct of the cross-claim before me. I do note, however, that the level of difficulty in the cross-claim before me was at a higher level of difficulty than Professor Rowley's case against the University. The reason for that is that Professor Rowley's case against the University was a case by an employee against his employer where there undoubtedly exists a relationship giving rise to a duty of care. Duty of care was very much in issue in the cross-claim in the sense that BIC argued that it did not owe Professor Rowley a duty of care and it was not in a relationship such as employer and employee where a duty of care clearly arises.
13. Professor Rowley's case against the University involved days of hearing in Adelaide and in Sydney and a leading Queen's Counsel from Melbourne was retained. Also, it was an acknowledged fact that $120,000 was paid by the University to Professor Rowley's solicitors for costs. Further, it was paid on advice from a solicitor experienced in litigation in this jurisdiction. These were all matters in the arena before me and I did not feel I could make an appropriate assessment. Mr Sheller has taken me to authorities from which he argues I could, without the additional material, make the assessment because of what these authorities stand for. That may be so, but I need not determine that at this point because, if it is so, they are authorities I was not given on the prior occasion and as a result it has been necessary to consider the matter afresh. It has been necessary to consider the matter afresh whether for the purpose of considering these authorities or for the purpose of considering the fresh evidence. This point really only goes to the costs of this application. In the circumstances, I grant the University leave to reopen its case.
14. Mr Nicholas has provided a report in which he offers the opinion that $120,000 was a reasonable figure for the costs and had they been assessed they would have been allowed within a range of $120,000 to $130,000. Mr Parker SC cross-examined Mr Nicholas to challenge whether his view was really an informed view considering a number of matters. For example, he did not inquire as to Turner Freeman's costs agreement with Professor Rowley. He did not see what Turner Freeman billed Professor Rowley or make an inquiry about that. He was aware of the indemnity principle, but had a misunderstanding of it. He did not examine a number of source documents to see if items claimed were relevant to the case against the University. He acknowledged at least one item was not properly claimable. He was at issue with Mr Parker SC on some other items.
15. I do not think these matters detract from the view I have now formed that $120,000 was a reasonable figure for Professor Rowley's costs. I form that view because of matters I have mentioned above which include the complexity of the matter, the hearing days involved and the retention of leading Queen's Counsel. There was also the qualification of appropriate experts to establish a difficult case and the analysis of countervailing experts' views. There was a considerable amount of section 25(3) material to harness, analyse and compile. The payment of the costs was done on the advice of Mr Cooper, a solicitor of vast experience in this Tribunal. When there is added to all of this the opinion of Mr Nicholas, I am satisfied that $120,000 was a reasonable figure.
16. So far as the evidence of Mr Nicholas is concerned, even if his figure of $120,000 should be lessened somewhat, that would not sway me from accepting that $120,000 was reasonable. The question is whether that figure is reasonable. It is reasonableness that is being sought, not precision, Bakker's case at 474-5. I would also note that BIC did not offer any evidence in opposition to Mr Nicholas and whilst Mr Parker SC cautioned me against applying Jones v Dunkel, I think I may do so and more confidently accept his opinion. I would add that I am satisfied as to the reasonableness of the figure without having to rely on the Jones v Dunkel inference.
17. That leaves the costs of this application. In my view, it has been necessary for the University to come back to this Tribunal to establish part of its case. It could have been dealt with before. Mr Sheller argues, however, that there was nothing to put the University on notice that the amount of costs was disputed. There is nothing in the affidavit of Olympia Samolis to suggest there would be any dispute, nor was there any suggestion before the argument on this application that issues such as the costs agreement and the indemnity principle would be raised.
18. I am curious as to why parties with advisers experienced in litigation in this Tribunal could not agree on the costs figure or at least on an appropriate range. This was not simply a contest as to whether $120,000 or some lesser figure was reasonable. It was fundamentally a contest as to whether the University was entitled to anything. Nevertheless, I do not think I can take into account one way or the other the lack of agreement on this point. I do think the costs agreement and the indemnity point could have been raised before. They did not depend on the production of a detailed bill of costs to be raised. In a sense, therefore, if one is looking at which party was responsible for the matter not being finalised, before the responsibility may be said to lie with both parties.
19. However, even if it was not clear in the correspondence before the case came on and even if for some reason or other the parties did not speak to one another before the case came on or at the time it was on, I think it is clear enough in the conduct of the case that BIC did enough to telegraph to the University that it did not accept that it was entitled to recover any contribution towards the costs. At that point, the University, in my view, ought to have presented more. I think, therefore, that BIC could have its costs of this application.
Following the pronunciation of my reasons this morning, the parties agreed an appropriate figure for interest to be $32,914. I make the following orders.
1. I grant leave to the cross-claimant to reopen its case.
2. The amount of contribution that I consider to be just and equitable is the sum of $129,500.
3. Interest is agreed on that sum at $32,914.
4. There will be a verdict and judgment for the cross-claimant on the cross-claim in the sum of $162,414.
5. Save as provided in the next item the cross-defendant is to pay the cross-claimant's costs of the cross-claim.
6. The cross-claimant is to pay the cross-defendant's costs of and incidental to the cross-claimant's notice of motion of 27 April 2007.
7. By consent, there will be a stay on execution of the judgment amount conditional upon the sum of $81,207 being paid within 28 days.
Mr J Sheller, instructed by Thompson Cooper, appeared for the cross claimant.
Mr T G R Parker, instructed by Makinson d’Apice, appeared for the cross defendant.
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