FRANKLINS LTD and ANOR v FLANNERY SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL HANDLEY, BEAZLEY and STEIN JJA 27 October 1997, 27 October 1997 [1997] NSWCA 115 COSTS — DISTRICT COURT — proceedings within jurisdiction of Local Court — judgment for less than $10,000 — whether plaintiff entitled to costs DCR Pt38 r1B The respondent, a minor, recovered $7,000 in a personal injuries action brought in the District Court at East Maitland. Liability was admitted. The award was below the prescribed amount of $10,000 under DCR Pt38 rlB. The trial Judge awarded the respondent costs on the basis that there was sufficient reason for bringing the action in the District Court because the assessment of damages for minors was fraught with difficulty, when the action was commenced it was reasonable to think that the plaintiff might well have recovered more than $10,000, and if the defendant thought otherwise it could have applied for a transfer to the Local Court. The defendant applied for leave to appeal against the award of damages and the order for costs. HELD: (1) The assessment of damages for a minor is not in principle more difficult than for an adult. The Damages (Infants and Persons of Unsound Mind) Act 1924 contemplates proceedings being brought by infants in the Local Court. The majority (Beazley JA doubting) also held that there was no proper basis for a finding that the plaintiff might reasonably have expected to recover more than the prescribed amount when the proceedings were commenced. There was no onus on the defendant to seek a transfer to the Local Court and the costs incurred in a contested transfer application would be disproportionate to the total cost of the proceedings. (2) The costs recoverable in the District Court were not greatly different from those recoverable in the Local Court. (3) It was cheaper and more efficient for the case to be brought in the District Court where it would be disposed of in a running list instead of in the Local Court where there was a risk that it could be adjourned part heard to a future date. (4) The costs order should not be disturbed. Handley JA Ex tempore The Court will refuse leave to appeal. This is an application for leave to appeal from the decision of Knight DCJ given in the District Court at East Maitland on 13 June this year. The case arises out of the claimant's liability as an occupier. The plaintiff, who was five and a half at the date of accident in January 1996, put his hand on an element attached to a refrigerator which was within reach of members of the public in one of the claimant's supermarkets. The element was hot and the boy sustained burns to four fingers and the thumb of his right hand. The Judge assessed general damages at $7,000 plus out-of-pocket expenses of $245. The Judge found that the plaintiffs physical injuries and his behavioural problems cleared up within some eight weeks, but there was a continuing problem involving increased bed wetting since the accident. The Judge found that this was due to the accident and that finding cannot be disturbed. The Judge thought that the bed wetting would gradually resolve after the judgment and assessed damages on that basis. 2 UNREPORTED JUDGMENTS I consider the award of damages very high for the physical and psychological injuries and consequences found by the judge but in my view the Court should not grant leave to appeal to review that assessment. The plaintiff recovered less than the prescribed amount of $10,000 provided for in the DCR Pt38 r1B. Accordingly, the plaintiff was not entitled to recover any costs in the action "... unless the Court certifies that it appears to it that there was a sufficient reason for bringing or trying the action in the Court". The proceedings were commenced by statement of claim filed on 10 July 1996 and were disposed of in a little over eleven months. The Judge made an order under r1B giving the plaintiff his costs of the action. He found that a number of matters constituted sufficient reason for departing from the general rule. The first of these was that the assessment of damages in relation to child plaintiffs is one that is "fraught with difficulty". In my judgment and with all respect that cannot be correct as a general statement. It was not correct in relation to this case and cannot be a reason for departing from the general rule. The Damages (Infants and Persons of Unsound Mind) Act 1924 specifically contemplates that actions for damages will be brought on behalf of infants in the Local Court. The next matter that the Judge referred to was that the time the action was commenced, "One might well have perceived that he would have been recovering for a far greater sum because of the psychological problems that he was then having". As I said the action was commenced on 10 July 1996 but on the Judge's findings the psychological problems, that is the behavioural problems, had resolved approximately two months after the accident in the middle of March. Although the plaintiff was seen by a clinical psychologist at a later stage, the Judge did not accept the view that there was any behavioural problems, other than the bed wetting, after some date in March. The other matter that the Judge referred to was that there was some onus on a defendant who considered that a matter is more appropriately brought in the Local Court to apply to have it transferred to that Court. In my view there is no such onus on a defendant. Moreover the cost of a contested application for transfer to the Local Court would be quite disproportionate to the total costs likely to be incurred in the trial of the action in the District Court. In my judgment therefore the Judge's exercise of discretion miscarried. This Court would normally consider the case as one appropriate for the grant of leave to appeal. General rules such as that laid down by DCR Pt39 r1B are meant to apply unless there is something special about the particular case to constitute a sufficient reason for the action being brought in the District Court. However one matter which the Judge did not refer to, which was raised by Mr Hudson in the argument before him, is that it is more efficient and cheaper for proceedings such as this to be commenced in the District Court where in all probability they will get heard in one day or on successive days in a running list. It seems that there is a real risk that proceedings in the Local Court will be part heard more than once and be adjourned, not to the next day, but for some weeks. The result is to greatly increase the overall burden of costs on both parties without achieving any useful purpose. If the plaintiff had brought these proceedings in the Local Court at East Maitland and recovered the same verdict he would ordinarily have been entitled to an order for payment of his professional costs and disbursements. The plaintiffs election to sue in the District Court therefore did not subject the defendant to a liability for costs which it would not have faced in the Local Court. Moreover Mr Hudson submitted to the Judge, and he was not contradicted, that URJ FRANKLINS LTD and ANOR v FLANNERY (Handley JA) 3 the costs in the District Court on this scale were not greatly different from the costs that would be recovered in the Local Court. In those circumstances the Judge reached the right result albeit for different and with respect erroneous reasons. I would propose, therefore, that the summons be dismissed with costs. Beazley JA I agree with Handley JA except with a slightly different emphasis in respect of one matter. The trial Judge considered that at the time proceedings were commenced one might have perceived that, "[The plaintiff] would have been recovering for a far greater sum because of psychological problems that he was then having". Whilst such material as appears does not convince me that the plaintiff would have recovered a far greater sum, it seems to the extent we have any material on the matter it was likely to be open to his Honour to make an award of over $10,000 because of the psychological problems that the plaintiff was then having. Save for that slight variation, I otherwise agree with the reasons of Handley JA. Stein JA I agree with Handley JA. Handley JA The order of the Court is summons dismissed with costs. Summons dismissed with costs. Counsel for the appellant: Mr Sheldon Solicitors for the appellant: Glover & Glover Counsel for the respondent: Mr Hudson Solicitors for the respondent: Parke Maher, Maitland