Roberts v A Professional Conduct Committee of the Nursing Council of New Zealand
[2014] NZCA 141
•15 April 2014 at 10.30 am
| IN THE COURT OF APPEAL OF NEW ZEALAND |
| CA299/2013 [2014] NZCA 141 |
| BETWEEN | MICHAEL ROBERTS |
| AND | A PROFESSIONAL CONDUCT COMMITTEE OF THE NURSING COUNCIL OF NEW ZEALAND |
| Hearing: | 13 March 2014 |
Court: | Ellen France, French and Cooper JJ |
Counsel: | A H Waalkens QC and K H Rose for Appellant |
Judgment: | 15 April 2014 at 10.30 am |
JUDGMENT OF THE COURT
AThe appeal is allowed.
BThe costs order made in the High Court is quashed and replaced by an order awarding costs to the appellant on the appeal and cross-appeal in the High Court on a 2B basis.
CThe respondent is to pay the appellant costs for a standard appeal on a band A basis together with usual disbursements.
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REASONS OF THE COURT
(Given by French J)
Introduction
Mr Roberts appeals a decision of Collins J in the High Court declining to grant him costs.[1]
[1]Roberts v A Professional Conduct Committee of the Nursing Council of New Zealand [2013] NZHC 442.
The main issue for determination is the extent to which ordinary costs principles apply to appeals brought in the High Court under the Health Practitioners Competence Assurance Act 2003 (the Act). In particular, whether the Judge was right to hold that instead of the usual rule that costs follow the event, a successful appellant is required to establish “a compelling reason” before being entitled to costs.
Background
Under the Act, professional conduct committees of the Nursing Council of New Zealand are responsible for investigating complaints against members of the nursing profession, laying charges of professional misconduct and prosecuting those charges before the New Zealand Health Practitioners Disciplinary Tribunal (the Tribunal).
Mr Roberts is a nurse. The respondent Committee (the Conduct Committee) laid a charge of professional misconduct against him on the ground that he had a sexual relationship with a vulnerable patient. He pleaded guilty to the charge. The Tribunal ordered suspension of his registration as a nurse for three years.
Mr Roberts appealed the Tribunal’s decision to the High Court on the ground that a three year suspension was excessive and unreasonable. The Conduct Committee cross-appealed, claiming that the Tribunal should have cancelled Mr Robert’s registration, not just suspended it.
The appeal and cross-appeal were heard by Collins J. The Judge allowed Mr Robert’s appeal and reduced the period of the suspension from three years to 18 months.[2] As a consequence, the cross-appeal was dismissed.
[2]Roberts v A Professional Conduct Committee of the Nursing Council of New Zealand [2012] NZHC 3354.
Having succeeded in his appeal, Mr Roberts then applied to Collins J for costs.
The Judge’s costs decision
The Judge acknowledged that under r 14.2(a) of the High Court Rules the general principle is that costs should follow the event, meaning that an unsuccessful party should pay costs to a successful party. However, he held that this rule did not apply to an application for costs by a successful appellant against a professional conduct committee. In his view, conduct committees were in a special position and should not be treated as ordinary civil litigants. Under the Act, the committees have an immunity from adverse costs awards in proceedings before the Tribunal. The Tribunal can award costs in favour of a conduct committee,[3] but not against one. The Judge contrasted this with the position of the equivalent bodies involved in disciplinary proceedings against lawyers under the Lawyers and Conveyancers Act 2006 – standards committees of the New Zealand Law Society. Under that Act, the relevant disciplinary tribunal can award costs both for and against the Law Society. The Judge said the immunity afforded professional conduct committees of the Nursing Council reflected the important public functions performed by them and, in his view, constituted a significant reason for departing from r 14.2(a) of the High Court Rules.
[3]Health Practitioners Competence Assurance Act 2003, s 101(1)(f).
That was not to say that costs could never be awarded in the High Court against a professional conduct committee, but that a higher threshold than usual would be required.
In the Judge’s view, costs should only be awarded against a conduct committee in the High Court if the successful appellant is able to establish a “compelling reason” for costs.[4] Justice Collins said a compelling reason might be found in the procedural history of the case or the substantive merits. Requiring a compelling reason was, the Judge stated, consistent with previous decisions where costs had been awarded against a conduct committee or similar prosecuting body.[5] In each of those cases, there had been a compelling reason to award costs.
[4]At [18].
[5]Patel v Complaints Assessment Committee HC Auckland CIV-2007-404-1818, 31 October 2007; and F v Medical Practitioners Disciplinary Tribunal [2005] 3 NZLR 774 (CA).
Applying that approach to the present case, Collins J held that he could not find any compelling reason to award costs to Mr Roberts in relation to his appeal. In his view, the Conduct Committee acted reasonably in opposing the appeal. There was nothing in the procedural history or substantive arguments that meant Mr Roberts’ appeal was bound to succeed. It could not be said the errors made by the Tribunal were obvious or patent. In contrast, however, the Conduct Committee’s cross-appeal lacked merit and was doomed to fail. It followed there was a compelling reason to award Mr Roberts costs on the cross-appeal, which the Judge fixed at 25 percent of the total costs that would otherwise have been awarded.
Mr Roberts now appeals that decision. His counsel Mr Waalkens QC acknowledged that the amount at stake is relatively modest but submitted that the decision is of general importance, affecting a wide range of professional groupings.
Finally in this recital of the background history, we record that the Conduct Committee does not appeal the award of costs made against it on the cross-appeal.
The questions of law for this Court
Under s 113 of the Act, an appeal to this Court from the High Court can only be on a question of law by way of the case stated procedure.
The Judge has stated the question for determination as being:
Did I err in law in the following respects:
(a)Determining that there needs to be a compelling reason why a successful appellant under the Health Practitioners Competence Assurance Act 2003 should be awarded costs (paragraph 20 of the judgment).
(b)Thereby rejecting the proposition that the usual rules [sic] that costs follow the event (Rule 14.7) applies.
(c)Determining that the respondent was not misguided in opposing the appeal (paragraph 21 of the judgment).
(d)Determining that the Tribunal’s errors were not so obvious and patent (paragraph 22) or manifest (paragraph 23) that the respondent should not at least have responded to the appeal.
(e)Not raising with counsel the matters in (a) and (b) herein and therefore not giving the parties the opportunity to provide submissions on those point(s).
Questions (c) and (d) would appear to raise questions of fact rather than law. Question (e) raises the issue of a breach of natural justice. However counsel for the appellant did not seek separate relief as a consequence of that alleged error alone. Our focus has therefore been on questions (a) and (b).
Arguments on appeal
On appeal, it was common ground that Mr Roberts’ costs application to Collins J was governed by the High Court Rules. It was also common ground that in requiring there to be a compelling reason, the Judge departed from accepted practice. Both Mr Waalkens and Mr McClelland have practised extensively in this field and told us that in their experience costs are usually resolved by the parties themselves on the basis that costs follow the event.
Mr McClelland nevertheless supported the decision. He pointed out that the decision to award costs is discretionary and that the High Court Rules expressly permit Judges to depart from the usual principle that costs follow the event. In his submission, the imposition of a “compelling reason” threshold was appropriate having regard to the public interest and the important public functions performed by the Conduct Committee under an Act designed to protect the health and safety of the public. Mr McClelland further contended that another category of appeal (in addition to those identified by Collins J) where compelling reasons might exist would be cases where the health practitioner is completely exonerated by the High Court.
For his part, Mr Waalkens contended that the imposition of a “compelling reason” threshold created a “massive hurdle” for successful appellants and would mean in practice that costs would almost never be awarded. He submitted this was unjust and contrary to the High Court Rules. He further submitted that the decision undermines the underlying policy of the High Court costs regime, which is that the determination of costs should be predictable and expeditious. Mr Waalkens also disputed the Judge’s analysis of the authorities and submitted that the outcomes in the various cases had not turned on the existence of a compelling reason. Rather, in his submission, they involved an orthodox application of the usual principle that costs follow the event.
Analysis
Rule 20.19(1)(c) of the High Court Rules states that on an appeal to the High Court, the High Court may make “any order the [C]ourt thinks just, including any order as to costs”. As counsel accepted, the exercise of this power, insofar as it relates to costs, is governed by the detailed costs regime contained in pt 14 of the Rules.
Rule 14.2 lists what are described as “the general principles” applying to the determination of costs. The first principle in the list is that “the party who fails with respect to a proceeding … should pay costs to the party who succeeds”. The remaining principles deal mainly with how costs are to be assessed.
Rule 14.7 states that despite r 14.2, the Court may refuse to make an order for costs or may reduce the costs otherwise payable if:
(a)the nature of the proceeding or the step in a proceeding is such that the time required by the party claiming costs would be substantially less than the time allocated under band A; or
(b)the property or interests at stake in the proceeding were of exceptionally low value; or
(c)the issues at stake were of little significance; or
(d)although the party claiming costs has succeeded overall, that party has failed in relation to a cause of action or issue which significantly increased the costs of the party opposing costs; or
(e)the proceeding concerned a matter of public interest, and the party opposing costs acted reasonably in the conduct of the proceeding; or
(f)the party claiming costs has contributed unnecessarily to the time or expense of the proceeding or step in it by—
(i)failing to comply with these rules or a direction of the court; or
(ii)taking or pursuing an unnecessary step or an argument that lacks merit; or
(iii)failing, without reasonable justification, to admit facts, evidence, or documents, or accept a legal argument; or
(iv)failing, without reasonable justification, to comply with an order for discovery, a notice for further particulars, a notice for interrogatories, or other similar requirement under these rules; or
(v)failing, without reasonable justification, to accept an offer of settlement whether in the form of an offer under rule 14.10 or some other offer to settle or dispose of the proceeding; or
(g)some other reason exists which justifies the court refusing costs or reducing costs despite the principle that the determination of costs should be predictable and expeditious.
In imposing a “compelling reason” test, the Judge relied on the catch-all “other reason” exception under r 14.7(g). Mr McClelland suggested in argument that reliance might also have been placed on r 14.7(e) (proceeding concerning a matter of public interest).
The “other reason” exception has been invoked to support the creation of other categories of cases exempt from the general rule, for example cases involving indulgences.[6] However, in our view, the number of such exempt categories should be kept limited, having regard to the policy of the costs regime and the emphasis it places on costs following the event. Otherwise the exception will swallow the rule. In our view, the fact that professional conduct committees perform a public function is not of sufficient weight to justify the wholesale creation of a new exempt category and the displacement of the usual presumption with another higher threshold.
[6]Holdgate v Holdgate HC Auckland CP303/96, 24 September 1996 at 3; and Mardon & Stephens Group Ltd v Zenn Holdings Ltd HC Auckland CIV-2006-404-707, 29 September 2006 at [11].See also Commerce Commission v Southern Cross Medical Care Society [2004] 1 NZLR 491 (CA); and Air New Zealand v Commerce Commission [2007] NZCA 27, [2007] 2 NZLR 494.
In short, we consider that the Judge’s approach involves too radical a departure from the costs regime. It is not justified on policy grounds and it is not supported by existing authorities.[7] There is nothing in the cases where costs have been awarded against a professional conduct committee in the past to suggest that the Judges in those cases considered they were applying a compelling reason threshold.
[7]Shirley v Wairarapa District Health Board [2006] NZSC 63, [2006] 3 NZLR 523 at [16]–[17]; and Manukau Golf Club Inc v Shoye Venture Ltd [2012] NZSC 109, [2013] 1 NZLR 305 at [13]. Also see F v Medical Practitioners Disciplinary Tribunal, above n 5, at [88]; Patel v Complaints Assessment Committee, above n 5; Director of Proceedings v Medical Practitioners Disciplinary Tribunal [2003] NZAR 250 (HC); ABC v Complaints Assessment Committee [2012] NZHC 1901, [2012] NZAR 856; and MacDonald v Professional Conduct Committee HC Auckland CIV-2009-404-1516, 10 July 2009.
Nor do we agree that a valid distinction can properly be drawn between disciplinary proceedings involving health professionals and those involving lawyers for the purposes of costs in the High Court. In our assessment, the public function of the respective investigatory bodies must rank as equally important and the fact that costs are available at Tribunal level in one case and not the other does not indicate that Parliament considered one more important than the other.
That is not to say we consider costs should always follow the event in these sorts of cases. We accept (as indeed did Mr Waalkens) that the fact professional conduct committees are performing a public function and have an immunity at Tribunal level may properly be taken into account in determining whether costs may be awarded and if so in what amount.
Given that the fact conduct committees are performing a public function will be a factor in every appeal, it might be thought that taking this into account will for all intents and purposes produce exactly the same result as that proposed by the Judge’s compelling reason threshold. Taking the public function into account will effectively mean that “something else” in addition to success may sometimes be required before costs can be awarded to a successful applicant. Ultimately, however, it is a question of degree or emphasis.
In our view, the correct and more principled approach is simply that the usual presumption still applies but, at the discretion of the Judge, the presumption may be more easily displaced than usual on account of the public function of professional conduct committees. A successful appellant is not, however, required to satisfy a “compelling reason” threshold.
That this is not just a matter of semantics is demonstrated by the facts of this case. Counsel agreed that if we rejected the “compelling reason” threshold, then rather than remit the matter back to the High Court for reconsideration, we should decide Mr Roberts’ costs application ourselves.
We have done so and have concluded that costs to Mr Roberts should have been awarded on both the appeal and cross-appeal. In our assessment, in the circumstances of this case, the fact the Conduct Committee was performing a public function was not a matter of any particular significance. The appeal was a fairly routine appeal in which the appellant succeeded and in fact obtained the precise reduction in sentence that he had sought in his notice of appeal.
Outcome
For the reasons articulated, we answer questions (a) and (b) in the case stated as follows:
Did I err in law in the following respects:
(a)Determining that there needs to be a compelling reason why a successful appellant under the Health Practitioners Competence Assurance Act 2003 should be awarded costs (paragraph 20 of the judgment).
Answer: Yes.
(b)Thereby rejecting the proposition that the usual rules [sic] that costs follow the event (Rule 14.7) applies.
Answer: Yes.
It is not necessary for us to address the remaining questions.
The costs decision of the High Court is quashed and replaced with an order awarding the appellant costs in the High Court on the appeal and cross-appeal calculated on a 2B basis.
The appellant, having succeeded in this Court, is also entitled to costs on the appeal before us. The respondent is to pay the appellant costs for a standard appeal on a band A basis together with usual disbursements.
Solicitors:
New Zealand Nurses Organisation, Auckland for Appellant
Nursing Council of New Zealand, Wellington for Respondent
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