Young v Central Australian Aboriginal Congress Inc

[2009] NTSC 36

Young v Central Australian Aboriginal Congress Inc & Ors [2009] NTSC 36

PARTIES:	YOUNG, ROSARIO
v
CENTRAL AUSTRALIAN ABORIGINAL CONGRESS INCORPORATED
and
JOHN DOMINIC BOFFA
and
NOEL ROBERT MORRISON
TITLE OF COURT:	SUPREME COURT OF THE NORTHERN TERRITORY
JURISDICTION:	SUPREME COURT OF THE TERRITORY EXERCISING TERRITORY JURISDICTION
FILE NO:	61 of 2003 (20303381)
DELIVERED:	23 July 2009
HEARING DATES:	27 January and 13 March 2009
JUDGMENT OF:	THOMAS J
CATCHWORDS:
REPRESENTATION:
Counsel:
Plaintiff:	P Barr QC with A Lindsay
First Defendant:	S Gearin
Second Defendant:	M Abbott
Third Defendant:	M Abbott

Solicitors:

Plaintiff:	Povey Stirk
First Defendant:	Collier & Deane
Second Defendant:	Cridlands MB Lawyers (Morgan Buckley)
Third Defendant:	Cridlands MB Lawyers (Morgan Buckley)
Judgment category classification:	C
Judgment ID Number:	Tho200906
Number of pages:	30
IN THE SUPREME COURT OF THE NORTHERN TERRITORY OF AUSTRALIA AT DARWIN

Young v Central Australian Aboriginal Congress Inc & Ors [2009]

NTSC 36 No. 61/03 (20303381)

BETWEEN:

YOUNG, Rosario

Plaintiff

AND:

CENTRAL AUSTRALIAN

ABORIGINAL CONGRESS INC

First Defendant

BOFFA, John Dominic

Second Defendant

MORRISON, NOEL ROBERT

Third Defendant

CORAM:  THOMAS J

REASONS FOR JUDGMENT

(Delivered 23 July 2009)

1. On 19 November 2008, I delivered written reasons with respect to the

substantive issues. The parties were granted liberty to apply on the question
of costs. The parties are not in agreement on the issue of costs. The
question of costs was further argued.

1. The plaintiff’s amended Minute of Orders filed on 27 January 2009 seeking

   costs reads as follows:

“1. The first defendant is to pay the plaintiff’s costs and

disbursements to be taxed in default of agreement or otherwise as

determined by the Court:-

1.1	of the plaintiff’s proceeding against the first defendant;
1.2	of the plaintiff’s proceeding against the second defendant; and
1.3	of the plaintiff’s proceeding against the third defendant.

2.         The plaintiff’s costs are payable on the indemnity basis pursuant to SCR 26.08(2).

3.         Alternatively to 2., the plaintiff’s costs are payable on the standard basis until 20 March 2006, and thereafter on an indemnity basis pursuant to SCR 48.12(12)(b) and/or SCR 26.08(2).

4.         The plaintiff’s costs are certified as fit for Senior and Junior Counsel pursuant to SCR 63.72(9)(b).

5.

The first defendant is to pay the second defendant’s costs to be the Court.

6.

There is no order as to costs of the third defendant, third defendant costs to be taxed in default of agreement or otherwise as determined by the Court.”

1. The plaintiff was granted leave to discontinue her action against

   Dr Morrison the third defendant on 8 March 2007 which was approximately

   one year prior to the commencement of the hearing of her claim against the first and second defendant. On 15 March 2007, Riley J made an order that

   the question of the third defendant’s costs of the discontinuance be reserved

   for the consideration of the trial judge. The terms of orders made in the

judgment delivered on 19 November 2008 were as follows:
The plaintiff succeeded against the first defendant in respect of the first

defendant’s breach of duty of care to the deceased in that the first defendant

failed to follow up the deceased’s diagnosis and treatment. The first

defendant’s claim for contributory negligence by the plaintiff was

successful. The amount awarded to the plaintiff against the first defendant was reduced by 50 percent to reflect the aspect of contributory negligence. The plaintiff’s claim against the second defendant was unsuccessful and

Judgment was entered in favour of the second defendant against the

plaintiff.

1. I will deal with each of the claims for costs

1.1.1 The first defendant is to pay the plaintiff’s costs and

disbursements to be taxed in default of agreement or otherwise as
determined by the Court of the plaintiff’s proceeding against the first
defendant

1. With respect to the plaintiff’s claim for costs of the plaintiff’s proceeding

against the first defendant, the submission on behalf of the plaintiff is for an
order for costs against the first defendant on an indemnity basis. I agree
with the submission made by Ms Gearin, on behalf of the first defendant,
that a substantial part of the hearing was taken up with respect to the

plaintiff’s claim against the second defendant. In addition to this the first

defendant succeeded in establishing that the plaintiff’s contributory

negligence amounted to 50 percent.

1. It is the position on behalf of the first defendant that there should be a

   50 percent reduction made in the costs awarded in favour of the plaintiff to

   take account of the time spent on the issue of contributory negligence in

which the first defendant was ultimately successful. Further, the submission
for the first defendant is that the first defendant should not have to bear the

costs of the second defendant.

1. The primary principle is that costs follow the event and a successful party is

entitled to costs against an unsuccessful party unless there are special
circumstances justifying some other order.[1]

1. During the course of argument on the issue of costs it was drawn to my

attention that on 25 January 2008, which was prior to the commencement of
the hearing of this matter, the plaintiff served a Notice of Offer of

Compromise offering to settle the claim for $180,000. Notice of Offer to

Compromise 25 January 2008 $180,000 attached to the plaintiff’s

submissions – costs 7 January 2009. This offer was not accepted by the first
defendant. This amount was less than the amount of $236,972 which was

ultimately awarded to the plaintiff, against the first defendant, after
allowing for a discount in the order of 50 percent for contributory
negligence by the plaintiff. At an earlier time the plaintiff had made an
even more favourable offer to the defendants which was refused (Order 48
conference).

1. The consequence of a failure to accept an offer of compromise are set out in

   Order 26.08. The relevant parts of that Rule are 26.08(1) and (2) of the

   Supreme Court Rules:

   “26.08 Costs consequences of failure to accept

   (1) This rule applies to an offer of compromise which has not been

   accepted at the time of verdict or judgment.

   (2) Where an offer of compromise is made by a plaintiff and not
   accepted by the defendant and the plaintiff obtains a judgment on the
   claim to which the offer relates not less favourable to him than the
   terms of the offer, then, unless the Court otherwise orders, the
   plaintiff shall be entitled to an order against the defendant for the
   plaintiff's costs in respect of the claim taxed on the indemnity basis.”

2. I accept the submission made by Mr Barr QC, for the plaintiff, that in

making the offer of compromise the plaintiff had to assess her risks in the
litigation and reflect that in the offer. The risk of a finding of contributory

negligence was one of those factors. Accordingly, I have concluded that the
fact the first defendant had refused such an offer means the first defendant

cannot now succeed in the assertion that costs should be reduced, when the ultimate final award was greater than the offer of compromise made by the plaintiff before trial.

1. I consider the plaintiff is entitled to an order for costs against the first

   defendant on a standard basis until 20 March 2006 when the first offer to

compromise was made and thereafter on an indemnity basis pursuant to
SCR 48.12(12)(b) and SCR 26.08(2).

1. It is submitted by Mr Barr QC that the plaintiff’s costs be certified as fit for

   two Counsel pursuant to SCR 63.72(9)(b) which states as follows:

   “63.72(9) No fee shall be allowed:

   …..

   (b) for more than one counsel, unless the Court certifies that the
   retainer of more than one counsel was warranted.”

2. Ms Gearin, on behalf of the first defendant, argues that the factual and legal

   issues in this matter were not complex and the defendants did not seek to

   argue the plaintiff’s calculations relevant to quantum.

[14]   I consider there were in fact complex factual issues particularly with respect

to medical evidence and the factual basis for the opinions formed by the

various experts. It was only after extensive examination in chief and cross examination by Mr Barr QC that the evidence relating to the responsibility for follow up of the deceased emerged. The subsequent submissions dealt

with the principles of law to be applied to those facts. There was essentially
no challenge by the defendants to the very careful and detailed calculations
made by Mr Lindsay for the plaintiff with respect to the quantum of
damages. The court accepted Mr Lindsay’s calculations.

1. Both liability and damages were complex matters and I would certify for two

   counsel for the plaintiff.

1.1.2 The first defendant is to pay the plaintiff’s costs and

disbursements to be taxed in default of agreement or otherwise as
determined by the Court of the plaintiff’s proceeding against the second
defendant.

and

5. The first defendant is to pay the second defendant’s costs to be taxed in default of agreement or otherwise as determined by the Court.

[16]   The plaintiff did not succeed against the second defendant but seeks a

Bullock/Sanderson order against the first defendant to include the costs of

the plaintiff’s proceedings against the second defendant and the costs of the

second defendant which the plaintiff would otherwise be liable to pay. This
claim is made on the basis that it was reasonable for the plaintiff to have
commenced and continued proceedings against the second defendant, further
that it was justified by the first defendant’s conduct which was such as to
make it fair to impose liability on it for costs of the successful defendant.

1. Counsel for the plaintiff, Mr Barr QC, referred to a number of passages in

   the substantive judgment and the conclusion that the failure to follow up the patient’s diagnosis and treatment did not rest with the second defendant but

rather was a result of a systems failure for which the first defendant was
liable.

1. It was argued on behalf of the plaintiff that the matters exculpatory of the

second defendant did not become apparent until the trial and the evidence
given by Dr Boffa and Dr Janusic. It was further argued that these matters

had not been properly raised on the pleadings by either the first or second
defendant. The first defendant had never conceded it was their duty to

ensure follow up occurred but had maintained that the follow up duty (if it
existed) was that of the second defendant Dr Boffa.

dismissed an appeal against a judge's refusal to make a Bullock order. Lord Greene MR said, at p 518: “The judge appears to have taken the view that it was reasonable for the plaintiffs from their point of view to make both these parties defendants to the action. He said a little lower down: ‘It was reasonable from the plaintiffs’ point of view, but it was not reasonable that (the unsuccessful) defendant should be penalized.'” In Johnsons Tyne Foundry Pty Ltd v Maffra Corporation (1948) 77 CLR 544, Dixon J said at 566: “In all the circumstances of this case I think the plaintiffs took a reasonable and proper course in joining

In Hong v A & R Brown Ltd [1948] 1 KB 515, the court unanimously attitude adopted by the defendant shire.”

In all these quotations I have emphasized the words which are material to the point I am now making. In my opinion they express a principle always applicable to the making of a Bullock order or a Sanderson order. It was agreed that in the case before me the difference between these two kinds of order was immaterial. Notwithstanding counsel's submission, I find nothing in the conduct of Citra, either before or after the writ was issued, which make it reasonable or fair that Citra should bear any liability for the costs of the successful defendants.”

1. Mr Barr QC referred to the findings in the judgment that it was the first

   defendant which had control and management of the Congress systems. It

was the first defendant which took away the responsibility upon an
individual doctor to follow up a patient.

1. Mr Barr QC referred to the decision in Sanderson v Blyth Theatre Co,[2] and

   Gould v Vaggelas.[3] He submitted the true position is as stated by Blackburn

   CJ in Steppke v National Capital Development Commission[4] at 30-31:

   “…there is a condition for the making of a Bullock order, in addition defendants.”
   to the question whether the suing of the successful defendant was
   reasonable, namely that the conduct of the unsuccessful defendant
   has been such as to make it fair to impose some liability on it for the
   costs of the successful defendant. In Bullock v London General
   Omnibus Co [1907] 1 KB 264 at 269; [1904–7] All ER Rep 44,
   Collins M R said: “The common sense underlying this order is clear,
   because the learned judge when he made it has before him evidence

   that, owing to the attitude taken up by the General Omnibus

2. Mr Barr QC also referred to the decision of Gibbs CJ in Gould v Vaggelas:[5]

   “The ground on which a Bullock order may be made is, in my
   opinion, more accurately stated in a passage in Sanderson v. Blyth
   Theatre Co,[6] which was cited with approval in Bullock v London
   General Omnibus Co.[7] and Hong v. A. & R. Brown Ltd,[8] viz., that the
   costs which the plaintiff has been ordered to pay to the defendant
   who succeeded, and which the plaintiff recovers from the defendant
   who has failed ‘are ordered to be paid by the unsuccessful defendant,
   on the ground that … those costs have been reasonably and properly

   incurred by the plaintiff as between him and the [unsuccessful]

   defendant’. In Johnsons Tyne Foundry Pty Ltd v Maffra

   Corporation,[9] stated the principle in a similar way, and Starke and

   Dixon JJ, in giving their reasons for making a Bullock order, both condition for the making of a Bullock order, in addition to the question whether the suing of the successful defendant was reasonable, namely that the conduct of the unsuccessful defendant has been such as to make it fair to impose some liability on it for the costs of the successful defendant’”.

   relied on the circumstances that the attitude adopted by the
   successful defendant had induced the plaintiff to join the other
   defendant: see at pp 559–60, 566. In my respectful opinion the true
   position was clearly stated by Blackburn CJ in Steppke v National

   See also the decision of Mildren J in Renehan v Leeuwin Ocean Adventure

   Foundation.[11]

3. It is submitted on behalf of the plaintiff that it was reasonable to sue the

second defendant and the conduct of the first defendant has been such as to
make it fair to impose some liability on it for the costs of the second
defendant.

1. It is the submission of Ms Gearin, on behalf of the first defendant that the

   plaintiff’s application for Bullock/Sanderson order against the first

   defendant should fail.

[24]   Ms Gearin argued that in these proceedings the first defendant had done

nothing which could reasonably be said to be reason for the plaintiff to
continue its proceedings against the second defendant. Nor had the first
defendant done anything which makes it fair and reasonable that it should

indemnify the plaintiff against the costs that the plaintiff must pay to the

successful second defendant.

1. Counsel for the first defendant points to the fact that the second and third

   defendant were brought into the litigation from the outset. It is the

contention on behalf of the first defendant that the reasons for joining the
second and initially the third defendant, was that the plaintiff desired to take
a chance of obtaining an additional, not an alternative, party against whom it
might recover. Ms Gearin argued on behalf of the first defendant that there
is nothing in the pleadings which could reasonably be said to suggest that

there was any conduct or act on behalf of the first defendant which was a

cause of the plaintiff continuing its claim against the second defendant. It is
asserted that at trial the case for the plaintiff was not pursued against the
first and second defendant in the alternative but damages were sought

against both defendants.

1. Ms Gearin on behalf of the first defendant submitted that her client had two

   policies of insurance. One in relation to the medical practitioners for

   medical malpractice. The findings of the Court were that there was no medical malpractice by an employed medical practitioner. Ms Gearin’s point is that had there been such a finding, then it would be unjust and

   inequitable that the first defendant be liable for costs.

2. The second point made by Ms Gearin is that under the policy of insurance

   the first defendant could not make any admissions in respect of the doctors.

   For this reason, it is argued on behalf of the first defendant they should not

   have orders made against them for indemnity costs because they were

   constrained by the insurance policies.

3. Ms Gearin referred to the fact that the first defendant had never argued a

   case against Dr Boffa. The only contribution notice that had been filed was in relation to s 22A of the Law Reform (Miscellaneous Provisions) Act that

   the employee shall not be liable to indemnify the employer in relation to

vicarious liability unless the employee is otherwise indemnified in relation
to his liability.

1. I do not accept that the submissions made on this issue on behalf of the first

   defendant are an adequate answer to the plaintiff’s claim for a

   Sanderson/Bullock order.

2. I agree with the argument presented by Mr Barr QC that the plaintiff and her

   lawyers reasonably and properly sued the second defendant because:

1) he was a medical practitioner who saw the deceased and correctly

identified a coronary (ischaemic) cause for the deceased’s symptoms

and history, yet

2)           he did not follow up on the deceased’s diagnosis and treatment.

1. The judgment found that the second defendant did not have a duty to follow

up because the system put in place by the first defendant took this
responsibility away from the second defendant and the “opportunistic follow
up system” put in place by the first defendant was inherently unreliable.

[32]   I agree that the matters exculpatory of the second defendant did not emerge

until the trial and in particular until Dr Boffa and Dr Janusic had given
evidence.

1. The first defendant did not raise anything in the pleading that would have

   alerted the plaintiff to the fact that it was the first defendant and not the individual doctors who had the responsibility to follow up diagnosis and

   treatment.

2. At the trial the first defendant denied it had a duty to follow up beyond the

advice given and appointments made by Dr Boffa on 2 March 2000. The
first defendant contended if there was a duty to follow up then that fell to

Dr Boffa. The findings made at the conclusion of the trial were that it was

the first defendant that had the management and control of the Congress

systems. It was the first defendant which took away the responsibility upon
an individual doctor to follow up a patient.

1. I prefer the argument put by Mr Barr QC that s 22A(1)(b) of the Law

   Reform (Miscellaneous Provisions) Act does not afford the first defendant

any defence against the plaintiff’s claim nor does it undo the first
defendant’s vicarious liability.

1. Mr Barr QC also made the point with respect to the constraints Ms Gearin

argued were imposed on the first defendant under the insurance policy. This
is because the third party, the insurance company, denied liability to

indemnify under the policy. I would agree that the first defendant was not

bound by the terms of a policy which the insurer had declined to honour.

Mr Barr QC also pointed to the pleadings in which the first defendant denied

it could be vicariously liable for the actions of its doctors. This was more
than was required if the policy of insurance was binding upon the first

defendant. There is no evidence that the first defendant approached their

insurers to discuss the matter or seek that any such constraints be relaxed in

the circumstances.

1. Finally, I would also agree with counsel for the plaintiff that whilst the case

against Dr Boffa was unsuccessful, it was necessary to elicit all of the
evidence in order to establish the duty of care owed by the first defendant to
the plaintiff and any breach of it. Whilst the evidence in chief of Dr Boffa

and the subsequent cross examination occupied a substantial amount of
Court time, there was a significant overlap of the interests of the first

defendant and the second defendant in such evidence. I do not think it

realistic to make any adjustment of costs because of this.

1. I consider in these circumstances the plaintiff is entitled to the orders sought

on her behalf that the first defendant pay the plaintiff’s cost and
disbursement to be taxed in default of agreement of the plaintiff’s

proceeding against the second defendant and that the first defendant should

pay the second defendant’s costs to be taxed in default of agreement or

otherwise as determined by the Court.

1.1.3 The first defendant is to pay the plaintiff’s costs and

disbursements to be taxed in default of agreement or otherwise as
determined by the Court of the plaintiff’s proceeding against the third
defendant.

6. There is no order as to costs of the third defendant Dr Morrison; alternatively, the first defendant is to pay the third defendant’s costs to be taxed in default of agreement or otherwise as determined by the court.

1. In making this particular application for costs, Mr Lindsay on behalf of the

   plaintiff, makes application for an “other order” pursuant to Order 63.11(9)

of the Supreme Court Rules which qualifies the standard position expressed
in Order 63.11(6):

“63.11 No order for costs required in certain cases

(6) A party who discontinues a proceeding or with-draws part of a proceeding, counterclaim or claim by third party notice shall pay the costs of the party to whom the discontinuance or withdrawal relates

to the time of the discontinuance or withdrawal.

…

(9) This rule is subject to such other order as the Court makes.”

[40] Mr Lindsay raised the following issues to be determined by the Court:

“(a)	Whether the plaintiff should be awarded costs against the third defendant, Dr Morrison even though the proceedings were discontinued against him, following investigation?
(b)	If so, should there also be a Bullock/Sanderson order against the first defendant in respect of those costs?
(c)	Alternatively, should Dr Morrison be awarded costs of the discontinued action, including some portion of them on an indemnity basis, as is submitted on his behalf?
(d)	If Dr Morrison should receive some costs of the proceedings against him, should they be paid by the first defendant, via a Bullock/Sanderson order?
(e)	Alternatively, should the plaintiff and Dr Morrison each bear their own costs of the proceedings (with the obvious consequence that the liability of Congress for a Bullock/Sanderson order need not be considered in relation to Dr Morrison)?”

[41]   Ms Gearin, on behalf of the first defendant, seeks an order:

(1) that the costs of Dr Morrison and the costs of the argument on who

should pay those costs should be borne by the plaintiff.

(2)	that the plaintiff’s application for a Bullock/Sanderson order against
the first defendant be dismissed.

1. Mr Abbott, on behalf of Dr Morrison, submits that there is no basis for an

   order that:

(a)	Dr Morrison pay the plaintiff’s costs; or
(b)	there be no order as to costs.

1. Mr Abbott seeks an order that the plaintiff pay Dr Morrison’s cost pursuant

to Order 63.11(6) on an indemnity basis. The position for Dr Morrison, as
outlined in Mr Abbott’s written submission, is as follows:

“If the Court should decline to make a Sanderson order against issue, namely that he is content to abide the event.”

Congress, Dr Morrison seeks an order that the general costs of the
action for which Congress is liable to the plaintiff be charged with
the plaintiff’s liability to Dr Morrison for costs and that Congress
pay the costs for which it is liable to the plaintiff into Court until
further order.
As to the plaintiff’s application for a Sanderson order against

Background Facts Relating to the Joinder of Dr Morrison as the Third
Party

1. I refer to the affidavit of Geoffrey John Stirk sworn 17 February 2009 and

   the affidavit of Alison Phillis sworn 5 March 2007.

[45]   The affidavit of Mr Stirk annexes a letter from Mr Peter Barr dated

5 October 2002.

1. In his letter dated 5 October 2002, Mr Barr discusses in some detail the role

of Dr Morrison. It was Dr Morrison who saw the deceased at Congress
shortly before the deceased died on 26 January 2001.

1. Mr Barr concludes in this letter that Dr Morrison was negligent in his

   treatment of the deceased in that he failed to obtain a proper history and

   failed to carry out a proper and thorough examination. In addition to this

   Dr Morrison was referring to the file of the deceased’s father who bore the

same name as the deceased and did nothing to obtain the correct files.
Mr Barr referred to the comments of the Coroner who, following an Inquest,

was very critical of the actions of Dr Morrison. However, Mr Barr advised
that this was not a sufficient basis to commence an action against

Dr Morrison as there was an onus on the plaintiff to prove on the balance of probabilities that the negligence of Dr Morrison caused the death of the

deceased.

[48]   Mr Barr recommended obtaining an expert opinion from an intensive care

specialist or from an emergency medicine specialist. He suggested certain questions the specialist could be asked on the issue of causation. Mr Barr

suggested that once such opinion had been obtained then a decision could be
made whether or not the negligence of Dr Morrison caused the death of the
deceased. The opinion from Mr Barr went into further details concerning

the role of Congress and Dr Boffa.

[49]   Mr Barr enclosed a draft Statement of Claim proposing the plaintiff proceed

only against the first defendant. His recommendation was that the pleading not be settled until the receipt of the two suggested expert reports. He also raised other matters with respect to Dr Boffa and Dr Morrison suggesting

enquiries be made about their respective medical insurance.

1. On 28 February 2003, the plaintiff issued a Statement of Claim against three

   defendants, namely Congress, Dr Boffa and Dr Morrison.

2. On 18 March 2003, solicitors for the plaintiff served the Statement of Claim

   on the first defendant. In letter of the same date, solicitors for the plaintiff advised they would only pursue the medical practitioners individually in the event the first defendant claimed they were not servants and agents of the

   first defendant. The letter requested the first defendant not provide a copy

   of the claim to either the second or third defendant at this stage.

3. A letter dated 7 June 2006 from Mr Barr QC, is annexure “D” to the

   affidavit of Mr Stirk sworn 17 February 2009. In this letter, Mr Barr QC refers to two expert reports, one from Dr Sangster dated 28 October 2003 and one from Dr Adjani dated 25 February 2003 the latter had been received

   by solicitors for the plaintiff on 3 March 2003. The plaintiffs had in fact

served the Statement of Claim on Dr Morrison in May 2003 irrespective of
the report from Dr Adjani dated 25 February 2003 in which Dr Adjani
concluded that whatever may have been the failings of Dr Morrison, they did
not alter the fatal outcome. At paragraph 10 of his affidavit, Mr Stirk
deposes as follows:

“On 16 May 2003 Mr Anderson of my firm had a telephone file note of that conversation.”

conversation with Mr. Ted Sinoch of Collier & Deane. Mr Sinoch
advised Mr Anderson he was acting for Congress and that Ms Short
of De Silva Hebron was acting for the insurer. He advised that there
was an argument between Congress and its insurer as to insurance
coverage. Mr Sinoch indicate that his client wished us to serve the
two doctors but that they would accept vicarious liability because the
doctor were employees of Congress. He also advised that Congress
did not have sufficient funds or assets to satisfy a judgement.

[53] All parties attended an unsuccessful settlement conference in June 2006.

1. In his letter dated 7 June 2006 to solicitors for the plaintiff, Mr Barr QC

referred to the failed settlement conference. Mr Barr QC advised the need
to discontinue against Dr Morrison. The letter goes into considerable detail

as to the reasons for this, including a review of the expert evidence on the
issue of causation. Mr Barr QC concluded that the claim against

Dr Morrison would fail because the plaintiff would not be able to satisfy the

Court on the balance of probabilities that the negligent actions of

Dr Morrison caused the death of Clive Impu.

1. Mr Barr QC advised negotiating a discontinuance on the basis that no costs

   are sought by the third defendant’s lawyers. Mr Barr QC advised solicitors for the plaintiff that if they could not obtain that result then he would wish

   to be involved in arguing the issue of costs, since there is a strong argument

   that:

“2.1	Mr Morrison was negligent;
2.2	Dr Morrison brought the litigation on himself by his unethical conduct in re-writing medical records and attempting to pass them off as his contemporaneous notes;
2.3	it was otherwise reasonable for the plaintiff to join him.”

[56]   On 14 August 2006, Morgan Buckley solicitors for Dr Morrison, forwarded

a letter to solicitors for the plaintiff dated 14 August 2006, advising their
client was not prepared to agree to the plaintiff’s discontinuance against
Dr Morrison on the basis of each party pay their own costs. They sought an

order pursuant to Rule 63.11 (6) which provides:

“A party who discontinues a proceeding or with-draws part of a
proceeding, counterclaim or claim by third party notice shall pay the
costs of the party to whom the discontinuance or withdrawal relates
to the time of the discontinuance or withdrawal.”

1. A Notice of Discontinuance with respect to the third defendant was filed on

   28 March 2007. The application came before Justice Riley on 8 March

2007. On that date the orders made were as follows:

“-	Third Party (CGU Insurance Ltd) will not be appearing in the matter. They neither consent to nor oppose any applications
-	Plaintiff has leave to discontinue their action against 3rd Defendant
-	Plaintiff has leave to amend her Statement of Claim to that appearing annexed to the summons
-	Plaintiff pay the costs of the 1st and 2nd Defendant’s in relation to the pleadings and consequential amendments to their defences
-	Issue of 3rd Defendant’s costs yet to be resolved and to be argued on Fri 16 March 2007 at 10am before Riley J unless orders can be made by consent.

1. As stated in paragraph 3 of these reasons for decision, Riley J made an order

   on 15 March 2007 that the question of the defendants’ costs of the discontinuance be reserved for the consideration of the trial judge.

[59]   The matter subsequently proceeded to trial during 2008 against the first and

second defendant and CGU Insurance Limited as the third party. Judgment
in the matter was delivered on 19 November 2008.

1. On 29 January 2009, the matter came back before the Court for argument on

   the issues of costs. This was the first occasion on which the plaintiff gave

   notice of an application to seek an order against the first defendant to pay the costs with respect to Dr Morrison. The argument relating to costs was

   part heard and adjourned to 13 March to enable the parties to prepare further

   submissions with respect to the issue of costs relating to Dr Morrison.

2. On 13 March 2009, Mr Lindsay, on behalf of the plaintiff, presented the

   argument for costs against the third defendant. Mr Lindsay referred to the various acts of negligence by Dr Morrison, that Dr Morrison had destroyed relevant evidence and substituted a non-contemporaneous record, which was

   false to the extent that one of the symptoms complained of by the deceased

   on the day he died was deleted.

3. It was argued that it was reasonable to join the third defendant and maintain

action against him until such time as the effect of the likely negligence and
other conduct had been properly assessed by the plaintiff’s lawyers.
Further, Mr Lindsay submits that in the time between establishing the gap in

causation evidence and negotiating on a discontinuance the plaintiff
concentrated on the other defendants and did not put the third defendant
under any particular burden.

1. The alternative position argued for the plaintiff is that if costs are to be

awarded in favour of Dr Morrison then those costs should be the subject of a
Bullock/Sanderson order against the first defendant.

1. I am not able to accept the arguments advanced on behalf of the plaintiff

   with respect to the costs of the proceedings against Dr Morrison.

2. Ms Gearin, on behalf of the first defendant, refers to the advice provided by

   Mr Barr QC in an opinion dated 5 October 2002. This was well before the

   Statement of Claim issued and identified the fact that at that time there was

no reliable evidence the negligence of Dr Morrison caused the death of
Mr Clive Impu. Ms Gearin referred to the fact that Mr Barr QC had

recommended seeking an expert opinion as to whether the actions of
Dr Morrison were causative of the death of Clive Impu.

[66]   I also refer to the following written submissions dated 22 January 2009

made by Mr Abbott on behalf of Dr Morrison:

“It was not ‘reasonable’ for the plaintiff to have sued Dr Morrison in
the absence of supportive expert evidence on the issue of causation³
in circumstances where the report of Dr Heard dated 6 May 2001
tendered at the inquest (exhibit D 41 in this action) concluded that ‘It
was very unlikely that Mr Impu would have survived no matter what
action was taken by [Dr Morrison] at this late stage’ and the findings
of the Coroner were to like effect: ‘Given how he presented to
Congress on 26 January 2001 even with a thorough and
comprehensive medical examination [by Dr Morrison] it is highly
possible that the deceased would have been allowed to go home first
before being urged to make his way to the hospital. Given the results
of Dr Zillman’s autopsy I accept that the deceased was living, to a
large extent, on borrowed time in the event that his illness was not

diagnosed.’ [paragraph 124].

_______________
³ It is conceded that Dr Heard gave the plaintiff some hope on the
issue of diagnosis: see the second paragraph on page 6 of his report
to the inquest.”

1. On the evidence before this Court, it is clear that despite the advice

   provided by Mr Barr QC the plaintiff issued a Statement of Claim against the three defendants which included Dr Morrison alleging negligence that

   caused the death of Clive Impu.

2. A few days later, ie. on 3 March 2003, solicitors for the plaintiff received an

opinion from Dr Adjani in which he opined that the actions of Dr Morrison
would not have altered the fatal outcome. However, despite having received
this opinion the plaintiffs went ahead and served the Statement of Claim on

Dr Morrison in May 2003.

[69]   Essentially, Dr Morrison had been consulted by Clive Impu on 26 January

2001 a short time before he died. Dr Morrison had before him the wrong

file, he did not carry out a thorough examination and did not obtain a

thorough history. Dr Morrison prescribed some medication. However, the

expert medical evidence both from Dr Adjani, and subsequently Dr Sangster
in his report dated 28 October 2003, was that at the time he consulted

Dr Morrison, the heart condition suffered by Clive Impu, was so advanced,

that the conduct of Dr Morrison made no difference to the inevitable result,

which was death.

[70]   I agree with the submission made by Ms Gearin, that professional

negligence on the part of a doctor causing or contributing to the death of
one of his patients, is a very serious allegation. An allegation that
Dr Morrison was bound to defend. It was an allegation made without proper

basis and made against the advice of counsel.

1. I agree there was no pressing urgency upon the plaintiff to comply with a

   limitation period as this did not expire until 24 January 2004.

[72]   By November 2003, the plaintiff had received an opinion from a second

expert, namely Dr Sangster, to the effect that they were unable to
substantiate that the actions of Dr Morrison caused the death of Clive Impu.

[73]   There is no reasonable explanation as to why an application to discontinue

was not made at that time. I agree with the submission made by Mr Abbott
on behalf of Dr Morrison that it is not to the point as Mr Lindsay argues,
that by the end of 2003 the plaintiff’s focus was on the other two

defendants. Dr Morrison was put in the position of having to take all

necessary steps to defend the claim against him. Neither is it to the point that the first defendant may not have been insured and able to satisfy any

order for damages. This was not a reason to make a claim that could not be
substantiated against another party.

1. I consider the third defendant is entitled to an order for costs in respect of

   the proceedings that were discontinued against him.

[75] The normal order would be costs on a party and party basis.

1. Mr Abbott, on behalf of Dr Morrison, submits costs should be awarded in

   favour of Dr Morrison on an indemnity basis.

[77]   Mr Abbott argues the plaintiff’s claim falls within the category of “hopeless

case” referred to in Fountain Selected Meats (Sales) Pty Ltd v International
Produce Merchants Pty Ltd and Others (1988) 81 ALR 397 at 401:

“… I believe that it is appropriate to consider awarding “solicitor
and client” or “indemnity” costs, whenever it appears that an action
has been commenced or continued in circumstances where the
applicant, properly advised, should have known that he had no
chance of success. In such cases the action must be presumed to have
been commenced or continued for some ulterior motive, or because
of some wilful disregard of the known facts or the clearly established

law. …”

See also Colgate-Palmolive v Cussons Co Pty Ltd [1993] 46 FCR 225 at

233.

[78]   I summarise the important aspects of the application as including the fact

the plaintiff ignored the advice of her counsel to obtain expert medical

advice on the issue of causation before issuing a claim against Dr Morrison.
In addition to this, the plaintiff maintained her action against Dr Morrison

for approximately four years after first receiving the opinion of an expert

that causation could not be established with respect to Dr Morrison. There

was a further expert’s report received during the intervening period which
confirmed the plaintiff could not sustain an action against Dr Morrison. By
letter dated 8 August 2006, solicitors for the plaintiff had advised solicitors

for the third defendant of the plaintiff’s decision to discontinue her action

against Dr Morrison. However, this did not formally occur until
March 2007.

1. In these circumstances, I consider Dr Morrison is entitled to an order for

   costs on an indemnity basis.

2. The next issue for consideration is whether it is appropriate to make an

order that the first defendant pay the costs of Dr Morrison or as it is referred
to a Bullock/Sanderson order.

[81]   Mr Lindsay submits that the relevant law concerning the discretion to make

a Bullock/Sanderson order is as follows:

1) The costs have been reasonably and properly incurred by the plaintiff

as between him and the successful defendant.

2)          The conduct of the unsuccessful defendant has been such as to make

it fair to impose some liability on it for costs of the successful

defendant – see Gould v Vaggelas.[12]

1. I do not consider the plaintiff has satisfied either of these conditions.

   Whilst it was reasonable to investigate the role Dr Morrison played in the

matter it was not reasonable to commence proceedings in the knowledge that
to succeed in a claim against Dr Morrison the plaintiff needed evidence to

substantiate causation. The plaintiff was aware through her lawyers that the action against Dr Morrison was maintained for some four years after receipt of expert opinions that causation could not be established.

[83]   The conduct of the first defendant was dealt with in the substantive

judgment delivered in this matter. The first defendant was found to be

negligent and to have contributed to the cause of death in failing to follow
up the deceased for a condition that could have been treated. The first
defendant was negligent in again having the wrong file produced when

Dr Morrison attended upon the deceased. However, the expert opinion

obtained by the plaintiff is that by this time it was too late for Dr Morrison
to have made any difference to the end result. The plaintiff either was or

should have been made aware from the advice given by her counsel prior to
any proceedings being commenced that evidence was required to establish
causation with respect to Dr Morrison.

[84]   Mr Lindsay argued that another unsatisfactory aspect of the first defendant’s

conduct was that when proceedings were issued the first defendant requested
that the Statement of Claim be served on the third defendant. However, the

plaintiff was not obliged to comply with such requests and should not have

done so knowing that the expert evidence was such that causation with

respect to Dr Morrison could not be established on the balance of
probabilities. Whether or not the first defendant was insured did not affect

the causation issue between the plaintiff and the third defendant. There is

no satisfactory explanation for why the plaintiff having received both expert
reports relating to Dr Morrison on the issue of causation by the end of
October 2003 did not actually seek leave to discontinue against Dr Morrison
until March 2007. I accept as set out in the affidavit of Mr Stirk sworn
17 February 2009, that on 8 August solicitors for the plaintiff wrote to

solicitors for the third defendant offering to discontinue against the third
defendant on the basis that each party pay their own costs. Annexure E to

the affidavit of Mr Stirk is copy of a letter from solicitors for the third

defendant to solicitors for the plaintiff advising the third defendant did not

agree to the plaintiff discontinuing on the basis each party bear their own
cost and referring to the Supreme Court Rule which provides that the party
discontinuing shall pay the costs of the party to whom the discontinuance

relates at the time of the discontinuance.

1. I do not consider it appropriate to make a Bullock/Sanderson order that the

   first defendant pay the third defendant’s costs.

2. The order I make is that the plaintiff pay the costs of Dr Morrison on an

   indemnity basis as agreed or taxed.

   Summary of Costs Orders

(1)     The first defendant to pay the plaintiff’s costs and disbursements to be taxed

in default of agreement of the plaintiff’s proceeding against the first

defendant.

(2)     The first defendant to pay the plaintiff’s costs and disbursements as taxed in

default of agreement of the plaintiff’s proceeding against the second

defendant.

(3)     The first defendant to pay the second defendant’s costs to be taxed in

default of agreement.

(4)     The above costs are payable on a standard basis until 20 March 2006 and

thereafter on an indemnity basis.

(5)     I certify the matter as fit for two counsel.

(6)     The plaintiff to pay the costs of the third defendant on an indemnity basis as

taxed or agreed.

(7)     I am not satisfied it is appropriate to go further and make the order sought

by Mr Abbott that the general costs of the action for which Congress is

liable to the plaintiff be charged with the plaintiff’s liability to Dr Morrison

for costs and that Congress pay the costs for which it is liable to the

plaintiff into Court until further order. That application is refused.

__________________________________

[1] See Order 63 Supreme Court Rules.

[2] [1903] 2 KB 533

[3] (1985) 157 CLR 215

[4] [1978] 21 ACTR 23

[5] (1985) 157 CLR 215 at 229-230.

[6] [1903] 2 KB 533 at 539.

[7] [1907] 1 KB 264 at 272.

[8] [1948] 1 KB 515 at 522.

[9] (1948) 77 CLR 544 at 556 Williams J, at pp 572–3.

10 (1978) 21 ACTR 23 at 30-1.

[11] (2006) 198 FLR 366 par 20-22.

[12] [1983-1985] 157 CLR 215 at 229.9.