Swindley v Finocchio (No 2) No. DCCIV-95-795 Judgment No. D35

[1999] SADC 35

PETER SWINDLEY v OLIVIA FINOCCHIO (NO 2)
[1999] SADC 35

Judge Lunn
Civil

Background

1. The plaintiff sued the defendant for damages for injuries which he had received in a road accident.  The action was called on for trial before me on 11 November 1997, but the trial was adjourned to a date to be fixed with the costs thrown away to be paid by the plaintiff because he needed to make major amendments to his pleadings.

2. The action again came on for trial on 9 June 1998 and fortuitously I was again the judge.  At the outset of the trial there was a delay of about 1½ hours because the copy documents were not in order.  I subsequently ordered that there be no costs for this period because both parties were at fault.

3. The plaintiff’s counsel opened his case and indicated that he was calling four medical practitioners and a psychologist.  He sought to tender various reports from these witnesses in the course of his opening.  When he identified the reports which he was tendering the defendant’s counsel indicated that he had not seen some of them.  It was agreed not to proceed further with the tendering of any reports and for counsel to confer about the matter during the lunch break.

4. Upon the resumption after the lunch break counsel for the defendant indicated that numerous further reports had been produced to him including some from doctors of whom he had no previous knowledge and who the plaintiff was not proposing to call.  I then adjourned for a time to enable defence counsel to consider these additional reports.  Later in the afternoon at his request I adjourned the trial to the following morning to enable him to speak to various doctors about matters raised in the additional reports.

5. On Wednesday, 10 June counsel for the defendant indicated that he had received twelve additional reports.  In relation to the report from a psychologist, Ms Daikin, the plaintiff’s solicitor alleged that her report had been posted to the defendant’s solicitors in May 1997.  Ultimately defence counsel conceded that the plaintiff was not in breach of his obligations under Rule 38.01 in respect of this report.  Defence counsel also conceded that another two of the twelve additional reports were of no significance.  However, he submitted, and ultimately it was not disputed, that the defendant was prejudiced in the presentation of its case at trial by the cumulative effect of the plaintiff not having complied with R38.01 in respect of the balance of the twelve reports.  As a consequence the defendant sought a substantial adjournment of the trial and ultimately the plaintiff consented to this.  The plaintiff’s counsel volunteered that the plaintiff’s solicitors were prepared personally to pay the costs thrown away by this adjournment.

6. Ultimately the trial was adjourned to October 1998 and on the basis that it was not part heard before me.  I ordered that the costs of the adjournment of the trial were to be paid by the plaintiff’s solicitors personally.

7. During the course of the argument about the effect of the plaintiff’s failure to comply with R38.01 I had foreshadowed that I might be raising of my own volition the making of an order under Section 42(3)(c) of the District Court Act 1991 (“the Act”) for the payment by the plaintiff’s solicitors of an amount to the Court as compensation for the time wasted. After adjourning the trial I called on the plaintiff’s counsel to address me on the issue of whether I should make an order against the plaintiff’s solicitors under this subsection. I accepted his submission that it was premature to deal with this issue at that stage of the action as under s42(3) such an order could only be made “at the conclusion of the proceedings”. Accordingly, I directed on 17 June 1998 that the matter be relisted before me after final judgment to consider any order under that subsection.

8. His Honour Judge Herriman heard the trial in October 1998 and on 18 December 1998 entered a final judgment on the claim including that the plaintiff have his costs as agreed or taxed. There was no appeal against that judgment. The matter was relisted before me on 3 March 1999 when counsel for the plaintiff’s solicitors made submissions opposing any order being made under s42(3)(c). Inter alia, he submitted that it was still premature for any such order to be considered because the costs payable to the plaintiff under the judgment had still not been agreed, taxed or paid. The defendant was excused from attendance.

Section 42(3) of the District Court Act

1. Section 42(3) of the District Court Act provides:

   “(3) If proceedings are delayed through the neglect or incompetence of a legal practitioner, the Court may, at the conclusion of those proceedings-

   (a).... disallow the whole or part of the costs as between the legal practitioner and his or her client (and, where appropriate, order the legal practitioner to repay costs already paid);

   (b)    order the legal practitioner to indemnify his or her client or any other party to the proceedings for costs resulting from the delay;

   (c)... order the legal practitioner to pay to the Registrar for the credit of the Consolidated Account an amount fixed by the Court as compensation for time wasted.”

“At the conclusion of the proceedings”

1. I accept there is no power to make any order under subsection (3) until “the conclusion of the proceedings”. There is no definition of this phrase in the Act or any reported judicial exposition of it.

2. It is first necessary to consider what is encompassed by the term “the proceedings” in this phrase. Again that term is not defined in the Act, and its definition in the District Court Rules does not govern its use in the Act. In relation to the term in the cross-vesting legislation Smart J said in Blake v Norris (1990) 20 NSWLR 300 at 306:

   “The defendant relied on the definition of ‘proceeding’ in the Shorter English Dictionary on Historical Principles, 3rd ed (1933) at 1677.  He referred to part of that definition and relied on part of the second meaning given: ‘A particular action or course of action; a piece of conduct or behaviour; a transaction.  Usu in pl’ and part of the third meaning given.  I set out in full the third meaning:

   ......... ‘3. Spec. The instituting or carrying out of an action at law; a legal action or process; any act done by authority of a court of law; any step taken in a cause by either party.’

   Reference was also made to the definition in the Macquarie Dictionary.  It is apparent from the meaning given in the Oxford Dictionary that ‘proceedings’ can mean either the action itself or a step taken in such action.

   In Stroud’s Judicial Dictionary, 5th ed, vol 4 at 2029-2035, some fifty-five instances are given of the use of the words ‘proceeding’ or ‘proceedings’ in legislation, rules of court or documents having legal significance.  The meaning depends on the context in which the word is used.  In some cases it is equivalent to ‘an action’ whereas in others it may mean a step in an action.  Sometimes it may include a counter claim.  The Oxford Companion to Law (1980) by Professor Walker states (at 1002-1003) that ‘proceedings’ is sometimes used as including, or meanings, an action or prosecution, and sometimes as meaning a step in an action.  The word ‘proceeding’ is capable of such a variety of meaning that dictionary definitions as to its ordinary or natural meaning are not of much use.  They tend to highlight the number of meanings which the word can bear.

   Any assistance as to its meaning has to be derived from the statutory context and the objects of the legislation in question.”

The term is also used in ss(3)(1), 20(4), 22(c), 23, 24, 25(1), 32(2c) and (3), 42(1) and (5), 45, 51(1)(ca), 52(2) and 54 of the Act. However, there is no apparent consistency of its usage, and in some of those sections it may refer to a step in an action whereas in others to an action as a whole. In s3(1) “action” is defined in terms of “proceedings”.

1. “Proceedings” in s42(3) in the context of the present matter means the action constituted by the plaintiff’s claim for damages. It is that which is to be the subject matter of the final judgment of the Court. (I need not go into whether in other circumstances it can mean anything less than the action or what might be the effect of an appeal against a final judgment.) What remains to be done after the final judgment, such as any taxation of costs or execution on the judgment, are administrative and not judicial processes, which may for some purposes be classified as proceedings in their own right, but they are not part of the action as such.

2. The “proceedings” as envisaged by (3)(c) are completed by the final judgment in the action.  As Professor Cairns says in “Australian Civil Procedure” 4th ed at 583, “A judgment .... completes the proceeding ....”

The context and subject matter of (3) require this interpretation of “proceedings” and not a wider one.  For example, in (3)(a) if a party was under a disability and an order of the Court was necessary for the solicitor and client costs to be paid to his solicitor out of the judgment moneys, it would be absurd to require an order first for the payment of those to the solicitor under R35.13 and for them to be taxed as between solicitor and client if a Court could thereafter make an order under (3)(a) that the plaintiff’s solicitor not be entitled to recover such costs.  Likewise, under (3)(b) if an order for indemnity is to be made against the solicitor, it should be before the costs in question are taxed, and not after, because, if the solicitor is to indemnify the party entitled to the costs, he has a right to be heard personally on the taxation of those costs if for other reasons he is no longer a solicitor on the record.

1. This interpretation of “proceedings” equates it for present purposes with “action”.  However, Parliament has not used “action” in (3), but its use of “proceedings” can be explained as (3) could also have a wider application such as in respect of discrete proceedings for taxation of costs, examinations in aid of execution or the like.

2. Therefore, I hold that the “conclusion of the proceedings”, as used in (3), has been reached in this matter and I have power to consider and make an order under that subsection.

Procedure

1. I am not aware of any contested order under s42(3)(c) ever having been made. There appear to be no similar provisions interstate or in England. There is an equivalent provision in s189(3) of the Summary Procedure Act 1921. In relation to an order under that subsection the Full Court accepted in Inglis v Clark (1993) 169 LSJS 186 that the Magistrate there could initiate the order of his own volition and could dispose of the issue summarily. In the circumstances of this matter there is no need to make the Registrar of the Court a party to the issue.

“Proceedings are delayed through the neglect or incompetence of the legal practitioner”

1. I find that the proceedings were delayed by reason of the trial being adjourned to a subsequent date.  I further find that this occurred “through the neglect or incompetence” of the plaintiff’s solicitors.  The obligations of the plaintiff’s solicitor under R38.01 to provide copies of medical reports was straightforward and a well known and usual procedure.  No explanation was proffered about why the reports were not supplied in accordance with R38.01.  There was an implied admission of neglect or incompetence by the plaintiff’s solicitors in their volunteering to accept an order that they pay personally the defendant’s costs of the adjournment.  Although it was not conceded in the argument on 3 March, I find that the plaintiff’s solicitors were guilty of both neglect and incompetence in failing to send the reports in question to the defendant’s solicitors as required by R38.01.  If they had done what they should have done under R38.01, or at least substantially complied with those obligations, the trial would have proceeded in the week of 9 June and would not have been adjourned.

“Time wasted”

1. Under S42(3)(c) the compensation is to be awarded “for time wasted”. In the course of the plaintiff’s opening on 9 June both counsel confirmed that it was likely to be a four day trial and thus it could have been expected to finish late on Friday, 12 June. (The ultimate trial before Herriman DCJ took much longer than four days but I disregard that.)

2. There were no other trials or hearings available for me to take between 9 and 12 June.  I commenced another matter on Monday, 15 June.  I had no reserved judgments to write at the time and no other judicial duties which could have occupied me in normal trial sitting hours between 9 and 12 June.  (I need not consider whether compensation can be payable under (3)(c) where there is other judicial work which the Judge can undertake.)  The trial could have been expected to occupy about twenty sitting hours between 9 and 12 June, but I deduct the 1½ hours lost because of the mistakes in the copy documents.  I find that the time wasted by the delay in the trial through the neglect or incompetence of the plaintiff’s solicitors was 18½ hours.

Compensation

1. It is unclear precisely what is meant by “compensation for time wasted” in (3)(c).  It is to be contrasted with “costs resulting from the delay” in (3)(b), and it would appear to be wider than that latter phrase.

2. In Vougamalis v Nixon (1991) 56 SASR 574 at 578-9 Olsson J considered the meaning of “compensation” in s53 of the Criminal Law (Sentencing) Act 1988 and in the Criminal Injuries Compensation Act 1978. He gave it its ordinary meaning of connoting recompense for loss or damage and held it was not to include any punitive element. The many reported expositions of “compensation” in other statutory contexts do not take the matter any further.

3. In recent times it has been increasingly recognised that the Courts provide a valuable and expensive judicial resource to the community and that proper regard is to be had to the expense of that resource and to the burden which it places on the State.  That has been part of the rationale behind the implementation of caseflow management procedures in the Court: United Motors Ltd v AGC (1991) 58 SASR 156 at 160. Section 42(3)(c) is thus directed towards making practitioners compensate the Court for where their default has improperly wasted these valuable judicial resources.

4. There is no demonstrable and tangible monetary loss which can be shown to have been incurred by the Consolidated Account through the delay of the trial in this matter.  If such a tangible loss had to be established, it would mean that (3)(c) would have almost no field of operation.  However, the contrast between the phraseology of 3(b) and 3(c), as pointed out above, suggests that it is not necessary for an actual loss resulting to the Consolidated Account to be established.  Under (c) the amount is “as compensation” and not “for compensation”.  Therefore, compensation here means a proper monetary sum to represent the time wasted, but not necessarily money actually lost.  It is analogous to the practice of allowing professional witnesses proper waiting time in assessing their witness fees where they are not able otherwise profitably to occupy themselves in the period in which they wait, although they cannot demonstrate that their overall earnings would have been any different even if they had not had to wait.

Quantum of the compensation

1. While it would be possible to refer the issue of quantum to a Master for some type of taxation or assessment I do not consider that is needed here.  I take judicial notice of the gross salaries of myself and my clerk.  I do not seek to extend the compensation to the salaries of other Court staff, eg court reporters or for other court resources, eg the courtroom.  I assess the compensation for the time wasted of 18½ hours at $1,600.

2. I order under s42(3)(c) that Carabelas & Co as the solicitors for the plaintiff pay to the Registrar of the District Court for the credit of the Consolidated Account the sum of $1,600 as compensation for time wasted.