Wallace v Nominal Defendant

[2005] QDC 23

[2005] QDC 023

DISTRICT COURT

CIVIL JURISDICTION

JUDGE ROBIN QC

No D79 of 2003

DONNA MAREE WALLACE

Plaintiff

and

NOMINAL DEFENDANT

and

MATTHEW JOHN HODGE

and

DEBRA ANNE ARNOTT

First Defendant

Second Defendant

Third Defendant

SOUTHPORT

..DATE 11/02/2005

ORDER

CATCHWORDS:  Whether costs payable by a plaintiff to defendants because of failure to beat their offer of settlement and not yet assessed - may be set off against the judgment and costs they must pay the plaintiff - plaintiff unlikely to be able to pay the defendants' costs once assessed - stay of enforcement of orders against the defendants until their costs entitlement is assessed as agreed - application per order for set-off adjourned.

HIS HONOUR:  The Court published reasons dated 27th of January 2005 to the parties following a trial which had occurred in the month before.  The parties were offered the opportunity to make submissions to the Court regarding the appropriateness of orders foreshadowed which included that the plaintiff's costs be ordered on the Magistrates Court scale. 

That proposal would not have been made had the Court been aware of circumstances bringing in the provisions of section 55F of the Motor Accident Insurance Act 1994, in I must confess to having had no prior experience of that provision, subsection 3(c) of which controls the matter, given that the conditions specified in the opening couple of lines are shown today to apply. Of course, the Court had no inkling what the insurers' mandatory final offer might have been.

Mr O'Sullivan, for the defendants, sought leave to read and file affidavits of his instructing solicitor, one sworn yesterday, one sworn today.  Those were made available to Mr Frampton, appearing for the plaintiff today, only minutes before Court.  He objected to those affidavits, although conceding that paragraph 2 of the first one which disclosed details of the defendants' mandatory final offer, in accordance with section 51C of the Act, of $50,000 plus regulation costs made on the 22nd of October 2003.

I do not think it was necessary for an affidavit to be prepared to place that offer before the Court. It is concerning that the affidavits came so late to Mr Frampton. I am sympathetic to the position of his client. There is a risk of having to pay the costs of those affidavits, two of them, not just one. They present information which is not really surprising to the Court, as to the delays that will occur in getting the costs which the defendants are entitled to under section 55F(c)(2) assessed. It is not particularly relevant to have details of the estimated costs the defendants, may be adjudged entitled to - which may or may not prove to be close to the mark in the end.

That is the approach I take in any event, given that in the circumstances, I think the Court ought to have the appearance which matters present to the plaintiff, who may have to pay, in mind.  Mr O'Sullivan's defence of the material was that given the overall exercise in which he is engaged which is to ensure that his client is not in the invidious situation of having satisfied the judgment and then discovering that there is no practical prospect of recovering the substantial costs due to it. 

There is something in Mr O'Sullivan's point that if the costs his clients stood to get were relatively minor in comparison with the judgment amount, his clients' exposure might not cause them or indeed the Court, the same level of concern.  The costs which under the section are all of the insurer's costs from and after the date when the proceedings started, are obviously likely to be substantial. 

Mr O'Sullivan reminded me of evidence that suggested the plaintiff herself is probably without substantial resources. If the judgment sum is paid in the usual way to her solicitors, they will properly have access to it from the point of view of getting their own charges satisfied. 

Reference has been made to Elhpick v. Elliott and MMI General Insurance [2002] QSC 285. In similar circumstances, Dutney J found that notwithstanding that the substance of order 93 rule 11 of the old Supreme Court Rules had not been adopted in the UCPR, it is open to the Court to order that costs a defendant is entitled to against a plaintiff may be set off against the amount of a judgment which a defendant has to pay to a plaintiff.

In result, his Honour did not have occasion to make orders because what struck him as unreasonable delay on the part of the defendants in getting their costs assessed made that sufficiently unfair to count against a favourable exercise of the Court's discretion.

Mr O'Sullivan began by seeking a set-off but abandoned further pursuit of that application immediately on the suggestion being made that pursuant to rule 800 or otherwise, the judgment amount and costs the plaintiff is adjudged entitled to (the costs being fixed by section 55F) be the subject of a stay of enforcement until assessment of the defendants' costs. 

In the end, Mr Frampton did not oppose that and it does not seem to me that he could usefully have opposed it. 

The Court expresses its regret to him that failure of clearer communication between it and the defendants' solicitors, led to him having notice of the fixture for today, only last Wednesday.  The circumstances were that pursuant to the invitation included in the reasons, the defendants' solicitors approached the associate indicating a wish to make submissions.  This morning was indicated to be a suitable time.  The associate's erroneous assumption was that the time had been cleared between solicitors.  Then, last Wednesday, the defendants' solicitors checked with the associate whether the plaintiff had agreed to the time of which, of course, they had heard nothing. 

I think the orders that the Court makes today are self explanatory in the circumstances.  There will be an order in terms of the initialled draft, heavily amended, which provides as follows:

(1)  There be judgment for the plaintiff against the

defendants, her damages being assessed in the sum of $42,190.15, which includes $2,239.80 prepaid rehabilitation expenses;

(2)  The defendants pay the plaintiff $39,850.35 on

account of the judgment, having regard to their already having paid those prepaid rehabilitation expenses;

(3)  The defendants pay to the plaintiff her standard

costs up to the date on which the proceedings were

started up to a maximum of $2,500;

(4)  The plaintiff pay to the defendants their standard

costs of the proceedings, not to include any costs     in respect of the affidavits of Sean Anthony    Sullivan sworn 10 and 11 February 2005;

(5)  Enforcement of the order for payments by the

defendants by stayed until the costs payable by the plaintiff to them have been finally assessed or agreed;

(6)  Adjourn to a date to be fixed, the defendants'

application for an order that the costs payable to

the defendants may be set off against the sums

payable to the plaintiff.

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