JONES v DAPTO LEAGUES CLUB LIMITED (No 2) [2008] NSWCA 111

New South Wales Court of Appeal

CITATION: JONES v DAPTO LEAGUES CLUB LIMITED (No 2) [2008] NSWCA 111

HEARING DATE(S): On the papers

JUDGMENT DATE: 27 May 2008

JUDGMENT OF: Mason P at 1; Beazley JA at 15; Bell JA at 16

DECISION: Substitute for order 4 made by this Court on 18 March 2008 the following: In place of the verdict for the plaintiff in the sum of $700 enter a verdict and judgment in the sum of $30,152, to take effect from 8 December 2006. Defendant to pay plaintiff's costs of the proceedings at first instance, such costs to be assessed on the ordinary basis up to 11am on 11 October 2006 and thereafter on an indemnity basis.

CATCHWORDS: PROCEDURE – Costs – general rule – costs follow the event – costs of whole action – where offer of compromise made – costs at first instance – Uniform Civil Procedure Rules 2005, r20.26

PARTIES: Bryan JONES DAPTO LEAGUES CLUB LIMITED

FILE NUMBER(S): CA 40867/06

COUNSEL: Appellant: D Kennedy SC/ G Smith Respondent: M Maxwell

SOLICITORS: Appellant: Lough Wells Duncan - Wollongong Respondent: McCabe Terrill

LOWER COURT JURISDICTION: District Court - Wollongong

LOWER COURT FILE NUMBER(S): 37/2005

LOWER COURT JUDICIAL OFFICER: Delaney DCJ

LOWER COURT DATE OF DECISION: 8 December 2006

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40867/2006

MASON P BEAZLEY JA BELL JA

Tuesday 27 May 2008

JONES v DAPTO LEAGUES CLUB LIMITED (No 2) JUDGMENT

1 MASON P: On 18 March 2008 this Court published reasons and made the following orders:

1. Opponent's application for leave to cross-appeal dismissed with costs.

2. Grant leave to the claimant to appeal subject to the filing of a notice of appeal within 7 days.

3. Appeal upheld.

4. In place of the verdict for the plaintiff in the sum of $700 enter a verdict and judgment in the sum of $30,652, to take effect from 8 December 2006.

5. Respondent to pay appellant's costs of the appeal and to have a certificate under the Suitors' Fund Act 1951 , if qualified. (See Jones v Dapto Leagues Club Limited [2008] NSWCA 32) 2 This has prompted two applications. 3 The respondent has applied, pursuant to r36.17 of the Uniform Civil Procedure Rules (UCPR) to correct the quantum of non-economic loss damages awarded ($22,000) on the basis that the appropriate award for 23% as at 8 December 2006 was $21,500. The appellant consents to this amendment. 4 Secondly, the appellant seeks to vary this Court's costs order by substituting orders that the respondent pay the appellant's costs of the proceedings at first instance and of the appeal; and that those costs be payable on an indemnity basis from 10 October 2006, being the date an offer of compromise was served pursuant to r20.26. 5 A short chronology puts the issues in context: Date Event 6.6.02 Accident 23.3.05 Statement of claim 18.9.06 Respondent serves final report of Dr Parker Hearing before Delaney DCJ 20.9.06 - Plaintiff gives evidence and is cross-examined - Plaintiff's case closed except for reserving the right to serve a supplementary report of Dr Teychenne in reply to Dr Parker's final report 10.10.06 Appellant served an offer under the Rules to settle for $20,000 plus costs: offer to remain open until 4pm on Friday 3.11.06 19.10.06 Respondent claimed that appellant had not supplied sufficient particulars or documents to enable full consideration of offer (cf UCPR r20.26(5)(a)) 2.11.06 (12.35pm) Dr Teychenne's supplementary report faxed to respondent's solicitor 3.11.06 (4.00pm) Expiry of time for acceptance stipulated in offer 8.11.06 Hearing continued to conclusion: judgment reserved

6 The appellant invokes r42.14 which applies to an unaccepted plaintiff's offer where the plaintiff obtains a judgment on the claim no less favourable than the terms of the offer. The judgment to be entered in accordance with the order of this Court is more favourable than the settlement offered by the plaintiff, even with the adjustment referred to above. In that situation r42.14(2) stipulates, in effect, that unless the court orders otherwise, the plaintiff is entitled to an order against the defendant for the plaintiff's costs in respect of the claim assessed on the ordinary basis up to 11am on the day following the day on which the offer was made and thereafter on an indemnity basis. 7 Judge Delaney made no order as to costs at first instance because of the minimal size of the verdict that he entered. I do not understand the respondent to contend that this order should stand in light of the appeal result. The respondent, however, resists the application of r42.14 on the grounds that the offer of 10 June 2006 was not a true compromise of the plaintiff's claim and that the offer did not comply with r20.26 (4) which stipulates that a plaintiff may not make an offer [under the Rules]: "unless the defendant has been given such particulars of the plaintiff's claim, and copies or originals of such documents available to the plaintiff, as are necessary to enable the defendant to fully consider the offer." 8 In my view, the offer complied with the rule. The respondent had access to all of the appellant's available medical reports; it had had the opportunity to hear and test all of the appellant's oral evidence; and it had availed itself of the opportunity of having the appellant examined by its own doctors. The appellant had been forced to reserve the right to tender a supplementary report from Dr Teychenne because Dr Parker's late-served report stated that the appellant's condition stemmed from chronic alcoholism and "early cerebral atrophy". In my earlier judgment, I described Dr Parker's latest report as "a significantly revised diagnosis" (J74). 9 The offer also contained a genuine element of compromise. It did not entail capitulation on the respondent's part. Rather, it was for a sum that fell short of the verdict awarded by this Court (albeit by a small margin). If accepted, the offer would have obviated a second day's hearing at trial.

10 This Court retains a discretion as to the costs of the proceedings at first instance because r42.14 (2) applies unless the court orders otherwise.

11 The respondent submits that it had insufficient time to respond to the offer given that the time for acceptance expired a little over a day after it received Dr Teychenne's supplementary report. It relies, in particular, upon the importance placed by this Court upon Dr Teychenne's latest report as responsive to Dr Parker's last report. I do not find this argument a compelling one. After all, it was the respondent that delivered Dr Parker's "significantly revised diagnosis" only two days before the trial, thereby prompting the unusual step of the appellant being given leave to respond to it by a supplementary report from Dr Teychenne. In rejecting the appellant's offer, the respondent effectively opted to rely upon Dr Parker come what may. There was, in any event, sufficient time for the defendant to consider Dr Teychenne's report and to accept the offer before it expired; or alternatively, to make its own counter-offer before the trial resumed five days later. 12 Accordingly, an order should be made in accordance with the rule as regards the first instance costs. 13 There is no barrier to this Court paying regard to the unaccepted offer in the exercise of its discretion as to costs of the appeal. But I would not vary the usual order that has already been pronounced. Those costs will include the costs of the present application. The appeal necessarily focussed upon the reasons for judgment given at first instance. It was open to the appellant to make a fresh settlement offer in that context and desirable that he should have done so. This was a fairly simple appeal, so the difference between ordinary and indemnity costs is likely to be marginal in any event. 14 I therefore propose the following order:

Substitute for order 4 made by this Court on 18 March 2008 the following: In place of the verdict for the plaintiff in the sum of $700 enter a verdict and judgment in the sum of $30,152, to take effect from 8 December 2006. Defendant to pay plaintiff's costs of the proceedings at first instance, such costs to be assessed on the ordinary basis up to 11am on 11 October 2006 and thereafter on an indemnity basis. 15 BEAZLEY JA: I agree with Mason P. 16 BELL JA: I agree with Mason P. **********

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