Reported Decision: 67 NSWLR 308
Court of Appeal
CITATION: Shellharbour City Council v Johnson [No 2] [2006] NSWCA 114 HEARING DATE(S): The matter proceeded by way of written submissions.
JUDGMENT DATE:
5 July 2006JUDGMENT OF: Beazley JA at [1]; Tobias JA at [2]; Hunt AJA at [3] DECISION: (1) The defendant is to pay the plaintiff’s costs of the appeal up to and including 22 June 2005 on a party and party basis and thereafter on an indemnity basis.; (2) The defendant is to pay the plaintiff’s costs of this application. CATCHWORDS: Plaintiff’s judgment for personal injury less than $100,000 — defendant unsuccessful in appeal against judgment — offer of compromise by plaintiff — Legal Profession Act 1987, s 198F, limits party’s right to seek indemnity costs order pursuant to rules of court — it does not itself authorise an indemnity costs order — “reasonable” offer defined — general approach by courts to offers of compromise pursuant to the SCR applicable to offers pursuant to UCPR — amount of interest lost on judgment if offer of compromise accepted relevant to whether offer should properly be regarded as a compromise — s 198D(4)(b) prevents order for costs exceeding maximum permitted, but it applies to certificate of assessment of costs filed in court, not to general order made by court that one party pay the other party’s costs but does not specify amount. LEGISLATION CITED: Civil Liability Act 2002
Civil Procedure Act 2005
Legal Profession Act 1987
Legal Profession Act 2004CASES CITED: Andrews v NSW (2004) 1 DCLR (NSW) 230
Connor v Hatgis (No 2), Court of Appeal (BC9501810), 7 December 1995, unreported
Forbes Services Memorial Club Ltd v Hodge (Court of Appeal BC9504456), 8 March 1995, unreported
Fowdh v Fowdh, Court of Appeal (BC9302200), 4 November 1993, unreported
Herbert v Tamworth City Council (No 4) (2004) 60 NSWLR 476
Hillier v Sheather (1995) 36 NSWLR 414
Hobartville Stud Pty Ltd v Union Insurance Co Ltd (1991) 25 NSWLR 358
Maitland Hospital v Fisher (No 2) (1992) 27 NSWLR 721
Manly Council v Byrne (No 2) [2004] NSWCA 227
Morgan v Johnson (1998) 44 NSWLR 578
Newcastle City Council v McShane [No 3] [2005] NSWCA 437
NSW Insurance Ministerial Corporation v Gomes (No 2), Court of Appeal (BC9807723), 3 December 1998
Nicholson v Nicholson (No 2), Court of Appeal (BC9504206), 1 February 1995
Nolan v Clifford (1904) 1 CLR 429
Penrith City Council v Parks [2004] NSWCA 381
Shellharbour City Council v Johnson [2006] NSWCA 67
South Eastern Sydney Area Health Service v King [2006] NSWCA 2
South Eastern Sydney Area Health Service v King [No 2] [2006] NSWCA 73PARTIES: Shellharbour City Council – Appellant
Aaron Johnson – RespondentFILE NUMBER(S): CA 40238/05 COUNSEL: PR Garling SC – Appellant
SG Campbell SC – RespondentSOLICITORS: Leitch Hasson Dent – Appellant
DGB Lawyers – RespondentLOWER COURT JURISDICTION: District Court LOWER COURT FILE NUMBER(S): DC 142/01 LOWER COURT JUDICIAL OFFICER: Quirk DCJ
CA 40238/05
BEAZLEY JA
TOBIAS JA
HUNT…
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Details
- Case
- [2006] NSWCA 114
- Decision Date
CaseChat Overview and Summary
Shellharbour City Council (the defendant) appealed a judgment awarded to Johnson (the plaintiff) for personal injuries, which was less than $100,000. The appeal was unsuccessful. The plaintiff had made an offer of compromise prior to the appeal. The central dispute concerned the basis on which the plaintiff should be awarded costs of the appeal, specifically whether an indemnity costs order was appropriate given the offer of compromise and the provisions of the *Legal Profession Act 1987* (NSW). The matter was heard in the Court of Appeal of New South Wales.
The court was required to determine whether the plaintiff was entitled to an order for indemnity costs of the appeal. This involved considering the effect of s 198F of the *Legal Profession Act 1987*, which limits a party's right to seek indemnity costs pursuant to the rules of court, and whether the plaintiff's offer of compromise met the definition of a "reasonable" offer for the purposes of awarding indemnity costs. The court also had to consider the application of the Uniform Civil Procedure Rules (UCPR) to offers of compromise and the relevance of the amount of interest lost on the judgment if the offer had been accepted.
The court reasoned that s 198F of the *Legal Profession Act 1987* does not itself authorise an indemnity costs order but rather limits the circumstances in which such orders can be sought. The general approach of the courts to offers of compromise under the Supreme Court Rules (SCR) is applicable to offers made under the UCPR. The court found that the amount of interest the plaintiff would have lost on the judgment if the offer had been accepted was a relevant factor in determining whether the offer should properly be regarded as a compromise. The court also clarified that s 198D(4)(b) of the Act, which prevents an order for costs exceeding the maximum permitted, applies to a certificate of assessment of costs filed in court, not to a general order made by the court.
The court ordered that the defendant pay the plaintiff's costs of the appeal up to and including 22 June 2005 on a party and party basis, and thereafter on an indemnity basis. The defendant was also ordered to pay the plaintiff's costs of the application.
The court was required to determine whether the plaintiff was entitled to an order for indemnity costs of the appeal. This involved considering the effect of s 198F of the *Legal Profession Act 1987*, which limits a party's right to seek indemnity costs pursuant to the rules of court, and whether the plaintiff's offer of compromise met the definition of a "reasonable" offer for the purposes of awarding indemnity costs. The court also had to consider the application of the Uniform Civil Procedure Rules (UCPR) to offers of compromise and the relevance of the amount of interest lost on the judgment if the offer had been accepted.
The court reasoned that s 198F of the *Legal Profession Act 1987* does not itself authorise an indemnity costs order but rather limits the circumstances in which such orders can be sought. The general approach of the courts to offers of compromise under the Supreme Court Rules (SCR) is applicable to offers made under the UCPR. The court found that the amount of interest the plaintiff would have lost on the judgment if the offer had been accepted was a relevant factor in determining whether the offer should properly be regarded as a compromise. The court also clarified that s 198D(4)(b) of the Act, which prevents an order for costs exceeding the maximum permitted, applies to a certificate of assessment of costs filed in court, not to a general order made by the court.
The court ordered that the defendant pay the plaintiff's costs of the appeal up to and including 22 June 2005 on a party and party basis, and thereafter on an indemnity basis. The defendant was also ordered to pay the plaintiff's costs of the application.
Orders
Orders of the court
(1) The defendant is to pay the plaintiff's costs of the appeal up to and including 22 June 2005 on a party and party basis and thereafter on an indemnity basis.; (2) The defendant is to pay the plaintiff's costs of this application.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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