Stokes v Ragless

Case [2019] SASCFC 31

SUPREME COURT OF SOUTH AUSTRALIA

(Full Court: Civil)

STOKES v RAGLESS

[2019] SASCFC 31

Judgment of The Full Court

(The Honourable Justice Blue, The Honourable Justice Parker and The Honourable Justice Lovell)

4 April 2019

DEFAMATION - ACTIONS FOR DEFAMATION - COSTS - INDEMNITY COSTS

APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - INTERFERENCE WITH DISCRETION OF COURT BELOW - IN GENERAL - WRONG PRINCIPLE - PARTICULAR CASES - DECISION AS TO COSTS

APPEAL AND NEW TRIAL - APPEAL - PRACTICE AND PROCEDURE - SOUTH AUSTRALIA - POWERS OF COURT - FURTHER EVIDENCE

The appellant successfully sued the respondent for defamation and applied for an award of indemnity costs pursuant to section 38 of the Defamation Act 2005 (SA). The respondent who was unrepresented opposed an award of indemnity costs on the basis he had already incurred considerable costs relating to the proceedings. The primary Judge found that it would not be in the interests of justice to award the appellant indemnity costs as the appellant was represented and had not informed the unrepresented defendant of the implications of accepting or rejecting filed settlement offers.

Whether the primary Judge erred in finding that a represented party has an obligation to inform an unrepresented party of the implications of accepting or rejecting filed settlement offers - whether the appellant was denied procedural fairness by the primary Judge proceeding on a basis not raised or relied upon by the respondent or the primary Judge before the court handing down its reasons.

Held, per Lovell J (Blue and Parker JJ agreeing):

1. The appellant was denied procedural fairness as he was denied an opportunity to contest a fundamental factual matter ultimately determined against him by the primary Judge.

2. The primary Judge erred in finding that a represented party is under an obligation to inform an unrepresented party of the implications of accepting or not accepting filed settlement offers in order for it to be in the interests of justice to award indemnity costs.

3. The appeal is allowed and the matter remitted to the primary Judge to reconsider the costs orders made on 17 April 2018.

Defamation Act 2005 (SA) s 38; Supreme Court (Civil) Rules 2006 (SA) rr 188, 286, referred to.
Stokes v Ragless [2017] SASC 159; Stokes v Ragless [2018] SASC 56; Jones v National Coal Board [1957] 2 QB 55; Stead v State Government Insurance Commission (1986) 161 CLR 141; Seltsam Pty Ltd v Ghaleb [2005] NSWCA 208; Chaina v Alvaro Homes Pty Ltd [2008] NSWCA 252; Pantorno v The Queen (1989) 166 CLR 466; Sullivan v Department of Transport (1978) 20 ALR 323; Victims Compensation Fund Corporation v Ngyuen & Anor (2001) 52 NSWLR 213; Re Association of Architects of Australia; Ex Party Municipal Officers' of Australia (1989) 63 ALJR 289; Fox v Percy (2003) 214 CLR 118; Lesses v Maras (No 3) [2017] SASCFC 154; Howley v Ghan [2019] SASC 4;

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AGLC
Stokes v Ragless [2019] SASCFC 31
Case
[2019] SASCFC 31
Decision Date

CaseChat Overview and Summary

The appeal concerned a defamation proceeding brought by the appellant, Stokes, against the respondent, Ragless. The dispute arose from publications made by the respondent concerning the appellant, following a disagreement over the management of a local field and game association. After a trial, the primary Judge found in favour of the appellant, awarding substantial damages and an injunction. The appeal to the Full Court of the Supreme Court of South Australia primarily concerned the primary Judge's decision on costs.

The legal issues before the Full Court were whether the appellant was denied procedural fairness and whether the primary Judge erred in finding an obligation on a represented party to inform an unrepresented party of the implications of failing to accept a settlement offer. Specifically, the appellant sought indemnity costs under section 38(2)(a) of the Defamation Act, which generally mandates indemnity costs for successful plaintiffs unless the interests of justice dictate otherwise. The primary Judge had refused this application, awarding only party/party costs.

The Full Court held that the primary Judge had erred in law by introducing a requirement not present in the rules or legislation. The Court found that the primary Judge's reasoning, which focused on the appellant's failure to explain the implications of settlement offers to the unrepresented respondent, amounted to a denial of procedural fairness. The Court stated that there is no rule obliging a represented party to advise an unrepresented party on the consequences of settlement offers, and that the primary Judge had applied a wrong principle in refusing indemnity costs on this basis. The Court also noted that the issue of the respondent's knowledge of settlement offer implications was not raised by the primary Judge during submissions, nor was it a matter on which the parties were invited to make further submissions.

The Full Court allowed the appeal, set aside the primary Judge's order for costs, and remitted the question of costs to the primary Judge for redetermination according to law. The Court indicated that the primary Judge should consider whether the interests of justice otherwise required that costs not be awarded on an indemnity basis, without reference to the now-rejected principle concerning the explanation of settlement offers.

Orders

Orders of the court

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Background

Background to the litigation

Two issues arise in this appeal:1Was the appellant denied procedural fairness?2Was the primary Judge correct in finding that there is an obligation on a represented party to inform an unrepresented party of the implications of failing to accept an offer of settlement?Background In 2012 the appellant and respondent were active members of the Southern Branch of the South Australian Field and Game Association (‘SAFGA’). The two men clashed over the management and planning of the Branch’s clubhouse renovations. In October 2012, the respondent’s firearms license and membership of SAFGA were suspended due to his “aggressive, erratic and irrational” behaviour.[1] The suspensions would have undoubtedly been devastating for the respondent who was described to have “lived and breathed” for clay shooting.[2] The respondent published defamatory material (as found by the primary Judge) concerning the appellant and the Southern Branch.[1] Stokes v Ragless [2017] SASC 159 at [3].[2] Stokes v Ragless [2017] SASC 159 at [2]. In October 2013, the appellant commenced proceedings against the respondent for defamation. It was alleged that between 30 October 2012 and 24 June 2014 the respondent defamed the appellant in 132 publications via a website, emails and on Facebook. After a 14-day trial, the primary Judge found in favour of the appellant. The primary Judge ordered that the respondent pay $70,000 in general damages and an additional $20,000 in aggravated damages. A permanent injunction was also ordered to prevent the respondent publishing any further defamatory material. On 12 April 2018, the primary Judge heard submissions on costs. The appellant submitted that he was entitled to costs on an indemnity basis pursuant to section 38(2)(a) of the Defamation Act. Section 38(2)(a) provides that where costs are to be awarded to a successful plaintiff in defamation proceedings, these costs are to be assessed on an indemnity basis subject only to “the interests of justice otherwise requiring”. The appellant filed comprehensive written submissions. At the close of the appellant’s oral submissions, counsel for the appellant indicated:I’m not certain that I need to put much more before your Honour. I’ll endeavour to answer any of the matters that your Honour might wish to put to me, but I rest on my submissions. The issue of the respondent’s knowledge of the consequences of accepting or not accepting a filed offer was not raised during submissions. The next day the appellant’s solicitors received a request from the primary Judge’s chambers to provide “copies of the letters sent to Mr Ragless serving each of the offers of settlement”. [3][3] Case Book page 351. The appellant’s solicitors complied with the request. No further information was requested by the Court nor were any further submissions made by the parties. On 17 April 2018, the primary Judge refused the appellant’s application for indemnity costs, awarding him costs only on a party/party basis. The primary Judge stated:Other than the period 20 October 2014 to 9 February 2015, the defendant was self-represented. The plaintiff filed four offers of settlement. At each time the offers were served on the defendant, the defendant was unrepresented. Each letter enclosing the offer of settlement did not explain to the unrepresented defendant the implications of accepting or not accepting each offer. Whilst there is no rule obliging a party represented by solicitors to inform an unrepresented party of the implications of accepting or not accepting a filed offer, in my view where this is not done the interests of justice require that costs are not awarded on an indemnity basis. It cannot be assumed an unrepresented defendant would be aware of the Supreme Court Rules regarding filed offers and s 38 of the Defamation Act such that the court can conclude the defendant unreasonably failed to make or agree to any settlement offer.(Underlining added)Grounds of appeal

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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