Wallace v Bannister
[2015] VSC 483
•11 September 2015
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
S CI 2012 07129
| CODY WALLACE (a person under disability who sues by way of his litigation guardian TRACY WALLACE) and TRACY WALLACE | Plaintiffs |
| v | |
| DAVID GEORGE BANNISTER | First Defendant |
| HUGH KELSO | Second Defendant |
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JUDGE: | ZAMMIT J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 2 September 2015 |
DATE OF RULING: | 11 September 2015 |
CASE MAY BE CITED AS: | Wallace v Bannister & Anor |
MEDIUM NEUTRAL CITATION: | [2015] VSC 483 |
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COSTS – Civil Procedure Act 2010 – Overarching obligations of parties and legal practitioners – application for adjournment of trial date – whether failure by legal practitioners to act promptly and minimise delay – s 25 – case management - breach of court orders – whether indemnity costs order appropriate – sanctions for breach of obligations.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiffs For Slater & Gordon | Mr A Pillar Ms S F Cherry | Slater & Gordon Slater & Gordon |
| For the First Defendant | Mr R H Gillies QC with Ms F Ellis | Perry Maddocks Trollope Lawyers |
| For the Second Defendant | Mr D Masel SC with Mr S P Cash | Avant Law Pty Ltd |
HER HONOUR:
By summons dated 27 August 2015 the second defendant sought orders that:
1. The Court refuse leave to the plaintiff to rely on the report of Mr Patrick Lo dated 24 August 2015.
2. Alternatively, if the Court grants leave to the plaintiff to use in evidence Mr Patrick Lo’s report dated 24 August 2015, that the second defendant be given leave to file and serve any necessary supplementary reports to the matters raised in Mr Lo’s report.
The application was heard on 28 August 2015. On the same day, without any notice to the Court, the plaintiff made an application for leave to file and serve an amended statement of claim.
Orders were made, dated 28 August 2015, vacating the trial date of 31 August 2015 and the plaintiff was given leave to file and serve an amended statement of claim.
The remaining issue is costs. The defendants seek their costs of the adjournment on an indemnity basis and that such costs be paid by the plaintiffs’ solicitors.
The plaintiffs’ solicitors seek an order that the costs be costs in the proceeding and that if a costs order is made in the defendants’ favour, it be on the standard basis.
The plaintiffs’ solicitors were separately represented at the costs’ hearing. They rely on an affidavit of Nicholas Matthew Mann, dated 2 September 2015 (‘the Mann affidavit’).
Background
The plaintiffs filed a writ and statement of claim on 20 December 2012.
The claim arises out of the first plaintiff’s medical treatment from May 2006 to July 2007, more than eight years ago.
The first plaintiff alleges that the defendants failed to diagnose a choroid plexus papilloma (CPP) and that amongst other things, due to the defendants’ alleged negligence, the plaintiff has suffered serious injury including an increased size of the CPP, development of seizure activity and speech impairment.
The first plaintiff is nine years’ old. The second plaintiff, the first plaintiff’s mother, brings a claim for nervous shock.
Orders were made on 26 February 2014 fixing the proceeding for trial on 1 June 2015.
On 8 May 2015, Associate Justice Derham made orders, including, that the trial date of 1 June 2015 be vacated and that the matter be relisted for trial on 31 August 2015.
On 14 August 2015, the trial date was confirmed at a final directions hearing and witness lists were provided by the parties.
Subsequently, a Call Over Form was completed by the parties dated 21 August 2015, again confirming that the matter was ready to proceed to trial and that there were no outstanding interlocutory steps.
On 25 August 2015 the plaintiffs’ solicitors served on the defendants a copy of an Order 44 statement by Mr Patrick Lo, the first plaintiff’s treating neurosurgeon.[1]
[1]Exhibits NN31 and NN32 – affidavit of Nicholas Mann affirmed 2 September 2015 (Mann affidavit).
On 27 August 2015 the second defendant filed its summons and orders were made on 28 August 2015 including the adjournment of the trial date.
Background circumstances
The background circumstances are summarised in the Mann affidavit:
·On 8 May 2015, the parties consented to the vacation of the 1 June 2015 trial date on the basis that the parties needed further expert reports, from neurosurgeons.
·The first plaintiff was to obtain an opinion from a neurosurgeon, Dr Leigh Atkinson and notes of conference with Dr Atkinson was served on the defendants on 11 June 2015.
·On 15 July 2015 the second defendant served a number of reports including an undated report of Dr Cindy Molloy, neurosurgeon, and Dr Chris Pappas, paediatrician, dated 20 May 2015.
·The issue of the second defendant’s failure to perform an MRI or CT scan and to organise brain scanning was raised in Dr Molloy’s report and the letter of instruction to Dr Chris Pappas raised the issue of the examination of the plaintiff’s anterior fontanelle by the second defendant. Dr Pappas’ report also considered the issue of CT scanning.
·On 4 August 2015, the second defendant’s solicitors served a report by Dr Robert Shavelle dated 31 July 2015, dealing with the issue of life expectancy.
·Mediation was conducted on 4 August 2015.
·On 5 August 2015 the plaintiffs’ solicitors arranged a conference for 19 August 2015 with the first plaintiff’s treating neurosurgeon, Mr Lo, in order for evidence to be provided with respect to the first plaintiff’s treatment.
·On 5 August 2015 Dr Atkinson and Dr Harbord, paediatrician, were provided with further material by the plaintiffs’ solicitors.
·On 13 August 2015, the plaintiffs’ solicitors received a further report from Dr Atkinson but did not consider that it raised any issues requiring any amendment to the pleading or an adjournment of the trial date of 31 August 2015.
·On 14 August 2015 Mr Mann appeared at the final directions and informed the Court that the plaintiffs were ready to proceed to trial. Mr Mann deposes that:
I submitted to this Honourable Court that my witness list was incomplete on the basis that the plaintiffs intended to call the first plaintiff’s treating neurosurgeon. In making this statement I believed that it was clear that I was referring to Mr Patrick Lo, and believed that the statement made plain that evidence would be adduced from Mr Lo in anticipation of the hearing.[2]
[2]Mann affidavit [38].
·Following the final directions hearing the plaintiffs’ solicitors continued to prepare for trial which included service of Dr Atkinson’s report dated 24 July 2015 and serving a note of telephone conference with Dr Pearson which raised an issue that a ‘rapid CT scan’ could have been ordered and the technique for organising CT scan would have been by way of a ‘wrap and feed’.
·Senior counsel for the plaintiffs and the plaintiffs’ solicitors met with Mr Lo on 19 August 2015 to discuss the treatment he provided and the nature and the cause of the first plaintiff’s ongoing injury. Subsequently on 24 August 2015 Mr Lo signed an Order 44 statement which was served on the defendants on 25 August 2015.
·Notes of a telephone conference with Dr Pearson signed 21 August 2015 was served on the defendants on 24 August 2015.
·On 24 August 2015 the plaintiffs’ solicitors were informed that Dr Simon Harvey, paediatrician, would not be able to appear to provide evidence at the trial on behalf of the plaintiff and accordingly on the advice of senior counsel for the plaintiffs, the plaintiffs’ solicitors sought a treating report from the first plaintiff’s treating paediatrician Dr Blair. The request was made on 27 August 2015 and the plaintiffs are still awaiting that report.
·On 24 August 2015 notes of the telephone conference with Dr Harbord, paediatrician, was served on the defendants.
·On 24 August 2015, the plaintiffs’ solicitors completed the Call Over Form which was emailed to the Court indicating that all interlocutory steps had been completed and that there were no proposed amendments to pleadings. Mr Mann deposes that:
In signing that form I inadvertently omitted that, in the event that Dr Harbord were to sign the telephone conference note dated 21 August 2015 that a minor amendment to the statement of claim would be made to further clarify the methods by which diagnosis could have occurred.[3]
·On 25 August 2015 the plaintiffs’ solicitors served a supplementary report by occupational therapist Ms Libby Callaway.
·On 25 August 2015 the first defendant provided copies of discoverable documents.
·On 28 August 2015 the amended statement of claim was served.
·On 1 September 2015, Dr Simon Harvey’s treating report was served on the defendants.
·On 1 September 2015 Dr Harbord’s report regarding the first plaintiff’s life expectancy was served on the defendants.
·On 2 September 2015 a supplementary report by Professor Dennerstein, psychiatrist, was received by the plaintiffs’ solicitors and served on the same day.
·A further report by Ms Libby Callaway dated February 2015 was to be served on the defendants on 2 September 2015.
[3]Exhibit NN41 – Mann affidavit.
Mr Mann considers that:
(a)The hearing of this matter was first adjourned on 8 May 2015, by consent of the parties, on the basis of an application by the second defendant that it had been delayed in seeking a neurosurgical opinion. Since that time, the second defendant has also served the report of Dr Chris Pappas, Dr Robert Shevelle and Ms Anne White. None of those experts were countenanced by the solicitors for the second defendant in its submissions to the Court on 8 May 2015.
(b)All parties have served material after the date required by the honourable Court.
(c)The plaintiffs were prepared for mediation and hopeful of resolving the dispute, and genuine attempts were made to resolve the case but without success. The mediation was not a waste of time. By contrast, the first defendant had served no expert evidence in support of its defence, and the second defendant served the report of Dr Robert Shevelle on the day of the mediation.
(d)After the mediation did not resolve, I [Mr Mann] took appropriate steps, on advice from senior counsel, to obtain evidence to confine the issues in dispute prior to the hearing scheduled for 31 August 2015. It was both right and proper for the plaintiffs to proof witnesses prior to the hearing, and to obtain evidence from Mr Patrick Lo prior to trial.
(e)No new issues were raised by any of the experts engaged by the plaintiffs, save for the specific diagnostic methods which should have been applied. In particular, the evidence of Mr Lo does not expand the scope of the plaintiffs’ case, but rather bolsters the evidence previously obtained and served in support of the plaintiffs’ claims, and acts to rebut the assertion by Dr Molloy that multiple surgeries would have been required irrespective of when the diagnosis occurred.[4]
[4]Mann affidavit [72].
Submissions
The plaintiffs’ solicitors submit that while Mr Lo’s report was undoubtedly late, the plaintiffs’ solicitor in open court on 14 August 2015 stated that he intended to call the treating neurosurgeon to give evidence. It was his belief that his statement was understood as he intended, that Mr Lo would be called and that the evidence would be adduced from him in anticipation of the hearing. At the time of the final directions hearing the conference with Mr Lo had been arranged but had not taken place. It occurred on 19 August 2015. The report was signed on 24 August 2015 and served on 25 August 2015.
The plaintiffs’ solicitors submit that there is nothing in Mr Lo’s report that had not already been canvassed by other medical experts, including the defendants’ experts. The plaintiffs’ solicitors submit that it cannot be said to have come as a surprise and that Mr Lo’s report was in large a response to and comment upon Dr Pappas and Dr Molloy’s reports.
In relation to the amended statement of claim, the plaintiffs’ solicitors submit that the amendments could not have taken the defendants by surprise and that the amendments did not alter the plaintiffs’ case in any substantive way in which the defendants were not already prepared to meet.
The plaintiffs’ solicitors submit that the proposed amendment came about as a result of terminology used by various experts and consisted of clarification of the terms brain scan/scanning of the brain by: (a) identifying a particular CT scan applicable to infants known as ‘wrap and feed’; and (b) expressly including ultrasound.
CT scans were already an express part of the pleading and it is submitted that ‘ultrasound’ was understood by the defendants and their experts to be included in the terminology of the pleading before the amendment was proposed. The plaintiffs’ solicitors consider that the amendments are by way of clarification and that they would be of assistance to the parties, the Court and the experts and that it was appropriate to make the amendments to narrow the issues in dispute.
The plaintiffs’ solicitors submit that the defendants’ conduct is such that it should be considered in the exercise of the Court’s discretion in determining costs. Reference is made to the fact that the second defendant sought and obtained an adjournment in May 2015 on the basis that he was seeking the opinion of a neurosurgeon, understood to be Dr Molloy. At the time, the second defendant’s legal representatives did not inform the plaintiffs or the Court that they had also sent instructions to Dr Pappas for a separate expert opinion. On 27 July 2015 the plaintiffs’ solicitors invited the first defendant to amend its defence as no evidence has been filed in support of the defence. To date no response has been received and no evidence filed.
On 27 July 2015 the plaintiffs’ solicitors requested copies of literature referred to in Dr Molloy’s report which has not as yet been provided. Dr Robert Shavelle and Dr Anne White’s reports were served out of time. The first defendant failed to provide the requested copies of discoverable documents until 25 August 2015 and the first defendant has never sworn an affidavit of documents.
Finally, in relation to the conduct of the plaintiffs’ solicitors it is submitted that given Mr Mann’s evidence, he understood that a reference to the plaintiff’s treating neurosurgeon at the final directions hearing was a clear reference to Mr Lo and that there was no intention to mislead the Court or the defendants’ solicitors. Mr Mann concedes his oversight by not mentioning the proposed amended statement of claim on the Call Over Form.
The plaintiffs’ solicitors submit that if the Court exercises its discretion in favour of the defendants it should limit any costs order to costs thrown away on the standard basis and that there is no justification from departing from the standard basis. Further, it is submitted that if any costs order is made against the plaintiffs’ solicitors it is appropriate that such costs be assessed by the Costs Court in default of agreement.
The defendants submit in summary that given the number of reports and the amended statement of claim post the final directions hearing on 14 August 2015, the plaintiffs’ solicitors misled the Court by confirming that the matter was ready to proceed to trial and again failed to have proper regard to the circumstances when the Call Over Form was completed on 24 August 2015.
The defendants submit that Mr Lo’s report raised issues that went beyond his role as a treating neurosurgeon and addressed causation issues critical to the plaintiffs’ claims. In addition, the defendants submit that the amendments raise new issues and were not minor as submitted by the plaintiffs’ solicitors.
The defendants submit that the number of additional reports filed and served after the final directions hearing are such as to require further investigation and time to obtain instructions.
Finally, the defendants submit that they should have their costs of the mediation given the new issues raised since the mediation.
Analysis
The factors that necessitated the adjournment of the trial date of 31 August 2015, were the late service of Mr Lo’s report dated 24 August 2015 and the amendments to the statement of claim.
The plaintiffs’ solicitors submissions that Mr Lo’s report raises nothing new in substance or that it does not expand the scope of issues previously dealt with by other experts, is misconceived.
What is clear from the Mann affidavit is that Mr Lo’s report provides, for the first time, Mr Lo’s opinion on issues raised by Dr Molloy. Mr Lo deals with the history of the treatment he provided to the first plaintiff and causation. Mr Lo provides his opinion that if surgery had occurred at an earlier stage the CPP could have been smaller and there would have been good prospects of removing the whole CPP. Also that the first plaintiff’s injuries including seizures, are more likely produced by prolonged hydrocephalus. Even if these matters in Mr Lo’s report were raised by Dr Molloy or any other expert, it misses the point, namely that one of the central witnesses, the first plaintiff’s treating neurosurgeon, gives a contrary view to that of Dr Molloy, which goes beyond giving the history of the treatment of the first plaintiff, for the first time, seven days before the trial date.
I accept that as at 14 August 2015, the final directions, the plaintiffs’ solicitors and senior counsel had not conferred with Mr Lo and that Mr Lo’s Order 44 statement was not received until 24 August 2015. However, the nature and issues to be raised by Mr Lo, were known to the plaintiffs’ solicitors at the time of the final directions hearing and at the time of the completion of the Call Over Form. To suggest that Mr Lo’s report would not potentially jeopardise the trial date was naïve. The plaintiffs’ solicitors submitted that at all times they were ready to proceed to trial. Again, this misses the point. The plaintiffs’ solicitors were armed with Mr Lo’s opinion and the defendants’ opinion and may well have been ready to confirm they were ready to proceed to trial on 14 August 2015 and again on 28 August 2015. However, the defendants were not aware until 25 August 2015 of Mr Lo’s report and were unable to obtain their own expert instructions in relation to Mr Lo’s report. To require the defendants to proceed to trial in such circumstances would have been extremely prejudicial.
The same comments apply to the amendments that were made to the statement of claim. While the issues of particular imaging may have been raised in early reports, the defendants are only required to respond to the pleaded case. If the amendments were so minor and were only by way of clarification of terminology, one asks rhetorically, why bother to amend the pleadings? I can only infer that the amendments were important and that the plaintiffs wanted all issues before the Court and that such issues be determined at trial.
I am not critical of the amendments per se and consider that it was appropriate to amend the statement of claim so that there is no doubt for the parties and the Court as to what the issues in dispute are and that all issues are finally determined. However, to suggest that they were inconsequential and would not affect the trial date fails to have regard to the need to provide the defendants with an opportunity to respond to the new pleaded case.
This is a case which raises complex medical and causation issues. Each party must have the time to consider all expert reports and obtain instructions and further opinion if necessary. Requiring any party to respond to significant matters days before trial is unfair and would not be in the interests of justice.
The second defendant’s application for the adjournment was justified in the circumstances. The real issue is whether the costs should be borne by the plaintiffs’ solicitors and whether they should be on an indemnity basis.
I accept Mr Mann’s evidence that he alerted the Court and the defendants at the final directions hearing that the plaintiffs’ witness list was incomplete and that they were awaiting the first plaintiff’s treating neurosurgeon’s report. By the time the Call Over Form was completed, the plaintiffs’ solicitors had conferred with Mr Lo and received his Order 44 statement. The proposed amendments to the pleadings were known to the plaintiffs’ solicitors and Mr Mann accepts it was an oversight on his part not to mention this on the Call Over Form.
I do not consider that Mr Mann deliberately misled the Court or the defendants’ solicitors. Orders requiring a final directions hearing in the Personal Injury List (PIL) commenced on 1 January 2015 and a final directions hearing is required for all cases in the PIL. A purpose of the final directions hearing is so that the Court can be satisfied that the matter is genuinely ready to proceed to trial. The orders require the parties to turn their mind to a number of matters including:
·Confirmation that the proceeding is ready for trial.
·Confirmation of the estimated number of sitting days.
·Confirmation of proposed expert lay witnesses to be called at trial.
·Identification of any outstanding interlocutory issues or proposed amendments of the pleadings.
·Identification of the main issues in dispute.
Orders were made in this case on 8 May 2015 by Associate Justice Derham, including an order for a final directions hearing. The Court requires attendance at the final directions hearing and that the parties consider and inform the Court of the matters listed in the Order for a final directions hearing. The parties are expected to engage in communication with one another before the final directions hearing to ensure that the proceeding is ready for trial and to identify any potential issues.
This case highlights that while the Court has a specialist PIL, a new Practice Note and a Notice to the Profession that commenced on 1 January 2015, what is still required is a cultural change by the profession. It is no longer acceptable that the parties breach orders without coming to court and providing an explanation and seeking further orders.
In this case that the plaintiffs’ solicitors did not turn their mind to a number of issues before the final directions hearing and when completing the Call Over Form. I note that, at the time of the first adjournment application by the second defendant in May 2015, the second defendant’s solicitors did not inform the Court of other expert opinions they had sought and were awaiting.
The principles that underpin case management by the Court of claims in the PIL are in the main to reinforce the overarching purpose as set out in s 7 of the CPA, that is, to facilitate the just, efficient, timely and cost effective resolution of real issues in dispute. Case management seeks to improve standards of conduct in litigation. The Court, through its case management of claims in the PIL, seeks to further the overarching purpose and must have regard to the objects set out in s 9. It is of benefit to list the objects:
(a) the just determination of the civil proceeding;
(b) the public interest in the early settlement of disputes by agreement between parties;
(c) the efficient conduct of the business of the court;
(d) the efficient use of judicial and administrative resources;
(e) minimising any delay between the commencement of a civil proceeding and its listing for trial beyond that reasonably required for any interlocutory steps that are necessary for –
(i) the fair and just determination of the real issues in dispute; and
(ii) the preparation of the case for trial;
(f) the timely determination of the civil proceeding;
(g) dealing with a civil proceeding in a manner proportionate to –
(i) the complexity or importance of the issues in dispute; and
(ii) the amount in dispute.[5]
[5]Section 9 of the CPA.
In Northern Health v Kuipers,[6] the Court of Appeal emphasised the importance of complying with the overarching obligations in the Civil Procedure Act 2010 (‘the CPA’) and the importance of compliance with case management procedures:
…Case management procedures that are adopted by courts seek to give effect to the overarching purpose of the Act in a manner that is fair to all parties while simultaneously advancing the administration of justice. The importance of compliance with case management procedures is reflected in the extensive sanctions that courts can impose under the Act in cases of non-compliance.
Parties conducting proceedings in a managed list, such as the List, must do all they can to comply with the Court’s timetabling orders. If they do not, they face the risk that orders will be made which may affect the manner in which, and the extent to which, they can conduct their case. For example, as appears from above, under s 51 of the Act, the Court may order that a party be precluded from relying on particular evidence. Parties should not seek to avoid compliance with an order by adopting an artificial interpretation of the order or by taking advantage of an ambiguity. Rather, they should endeavour to comply with the intended purpose of the order.[7]
[6][2015] VSCA 172.
[7]Ibid [119]-[120] (citations omitted).
In any proceeding, there will be an intensive preparation period prior to trial. Inevitably, even with the best prepared case, new issues can arise that were not anticipated. Conferring with witnesses and experts may raise a new point that has never arisen before. The parties and the Court must have a flexible and realistic attitude to such circumstances.
However, in the context of this case, I consider that the failure to identify and raise with the Court and the defendants specifically that a report was being obtained from Mr Lo and the nature of that report and the proposed amendments to the pleading, were serious oversights by the plaintiffs’ solicitors which could have been avoided. The oversights necessitated the adjournment of the trial.
This is a proceeding where the alleged negligent medical treatment of the first plaintiff occurred in 2006 to 2007. The case raises complex medical issues and involves numerous medical and allied medical experts. Parties have no doubt conferred with experts and the defendants themselves. In considering relevant factors to the exercise of the Court’s discretion in making costs orders, it is appropriate for the Court to have regard to case management considerations, including delay, prejudice to other litigants, waste of public resources and loss of public confidence in the legal system, through the vacation of a trial date.
The first plaintiff’s alleged injuries are serious. This case is now listed for trial on 30 May 2016. The Court’s resources have been unnecessarily burdened by the applications and the adjournment. The parties have wasted time and costs and there will be a delay in the finalisation of the claim. This is through no fault of the plaintiffs. Personal injury cases give rise to emotional, financial and reputational burdens for plaintiffs and defendants. This case is no exception.
In Yara Australia Pty Ltd & Ors v Oswal,[8] the Court of Appeal provided a detailed analysis of the CPA in the context of costs and in particular costs against legal practitioners. Yara reaffirmed that one of the main purposes of the Act is to provide for an overarching purpose in relation to the conduct of civil proceedings to ‘facilitate the just, efficient, timely and cost effective resolution of real issues in dispute’ and that the Court is obliged to give effect to that overarching purpose.[9] The overarching obligations apply to any person who is a party, any legal practitioner, legal representative or law practice acting for or on behalf of a party.
[8](2013) 41 VR 302 (‘Yara’).
[9]Section 7; Yara (2013) 41 VR 302, 306 [8]-[9].
Part 2.3 of the CPA sets out the overarching obligations and the paramount duty that each person to whom the overarching obligations apply. That is, each person to whom the overarching obligations apply has a paramount duty to the Court ‘to further the administration of justice in relation to any civil proceeding in which that person is involved’.[10] Part 2.3 then goes on to set out a number of overarching obligations that apply to each person.
[10]Section 16.
I consider that the plaintiffs’ solicitors have breached their overarching obligation to minimise delay for the reasons set out above.[11] They should have alerted the defendants and the Court of Mr Lo’s report and the nature of his report on 14 August 2015 at the final directions and of the potential amendments. This may have resulted in an adjournment at that stage but would have minimised the costs wasted and delay in the re-fixing of this matter.
[11]Section 25.
Part 2.4 of the CPA governs the Court’s power to issue sanctions for contraventions of the overarching obligation. In Yara, the Court of Appeal noted the following in relation to s 29 which was described by the Court of Appeal as ‘a unique provision, conferring powers broader than those in any other jurisdiction in Australia, to sanction legal practitioners and parties who fail to meet their overarching obligations’.[12]
[12]Yara [17].
The Court of Appeal went on the say the following in relation to s 29:
Section 29 of the Act provides the Court with broader and more flexible powers than under the Supreme Court (General Civil Procedure) Rules 2005 (‘the Rules’) or under its inherent jurisdiction. Rule 63.23(1) enables the Court to make orders for costs against a legal practitioner who has caused costs to be incurred improperly by a failure to act with reasonable competence and expedition. However, the primary object of r 63.23(1) is not punitive or disciplinary but compensatory, enabling reimbursement of a party’s costs incurred because of the default of the solicitor. The primary object of the Rule is not to punish the solicitor, but to protect the client who has suffered and to indemnify the party who has been injured.
…
The Court’s powers under s 29 of the Act include the power to sanction legal practitioners and parties for a contravention of their obligations as the heading to Part 2.4 indicates. In our view, these powers are intended to make all those involved in the conduct of litigation — parties and practitioners — accountable for the just, efficient, timely and cost effective resolution of disputes. Through them, Parliament has given the courts flexible means of distributing the cost burden upon and across those who fail to comply with their overarching obligations. A sanction which redistributes that burden may have the effect of compensating a party. It may take the form of a costs order against a practitioner, an order that requires the practitioner to share the burden of a costs order made against their client or an order which deprives the practitioner of costs to which they would otherwise be entitled. The Act is clearly designed to influence the culture of litigation through the imposition of sanctions on those who do not observe their obligations. Moreover, the power to sanction is not confined to cases of incompetence or improper conduct by a legal practitioner.
…
Section 28(2) enables a court, in exercising its discretion as to costs, to take into account any contravention of the overarching obligations. In our view, the enactment of s 29 together with s 28(2) imbues the Court with broad disciplinary powers that may be reflected in the costs orders that are made. The Court is given a powerful mechanism to exert greater control over the conduct of parties and their legal representatives, and thus over the process of civil litigation and the use of its own limited resources.[13]
[13]Ibid [18], [20], [21] (citations omitted, emphasis added).
The parties had an obligation to comply with the orders made in relation to the final directions hearing, that is to be prepared to inform the Court of relevant factors that could affect the trial or the trial date. The plaintiffs’ solicitors breached the order made by Derham AsJ on 8 May 2015 by not fully informing the Court of Mr Lo’s report and the proposed amended statement of claim. The plaintiffs’ solicitors, also, but separately, did not comply with s 25 of the CPA, to act promptly and to minimise delay. The Court was not given a proper explanation of the steps yet to be taken on 14 August 2015 or again on 24 August 2014 when the Call Over Form was completed.
I do not consider that the plaintiffs’ solicitors conduct justifies a costs order in relation to the mediation. What is clear is that all the parties went to mediation having served reports at a very late stage. It is not unusual that mediation may give rise to the need for further investigations.
In a highly technical area of law such as medical negligence, expert evidence is critical in assisting the parties and the courts in assessing each parties’ case. The plaintiffs’ solicitors failure to obtain Mr Lo’s report earlier and to that extent other medical reports which gave rise to the amended statement of claim, necessitated the adjournment of the trial date at a very late stage. The conduct was contrary to the proper and efficient running of the principles underpinning the PIL. The conduct is inconsistent with modern case management principles and contravenes s 25 of the CPA.
I consider for the reasons set out above that it is appropriate in this case that the plaintiffs’ solicitors pay the defendants’ costs thrown away by reason of the adjournment of the trial date. I do not consider the plaintiffs’ solicitors’ conduct is of such a nature to give rise to the costs being awarded on an indemnity basis. I have annexed the orders for the ongoing interlocutory steps and the provision of a new trial date.
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