Wainwright v Fuller & Ors [1999] NSWSC 1019

New South Wales Supreme Court CITATION : Wainwright v Fuller & Ors [1999] NSWSC 1019 CURRENT JURISDICTION : Common Law Division FILE NUMBER(S) : 11823/92 HEARING DATE(S) : 16/08/99 JUDGMENT DATE : 11 October 1999

Jelica Helen Wainwright by her tutor Jacob Pejkovic (plaintiff) PARTIES : Jennifer Fuller (defendant1) Alan Henderson (defendant 2) Paul Robert Wainwright (defendant 3) JUDGMENT OF : Hidden J at 1

COUNSEL : P Jones (plaintiff) R Bartlett SC (defendants) SOLICITORS : Benjamin & Robinson (plaintiff) Abbott Tout (defendants) CATCHWORDS : Costs - indemnity basis - offer of compromise by plaintiff - judgment for greater amount - whether exceptional case - Supreme Court Rules Part 52A, rule (22)4. ACTS CITED : Supreme Court Rules Maitland Hospital v Fisher (No 2) (1992) 27 NSWLR 721 CASES CITED : Morgan v Johnson (1998) 44 NSWLR 578 Connor v Hatgis (No 2) (Court of Appeal unreported 7 December 1995) DECISION : Indemnity costs ordered

THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

HIDDEN J Monday, 11October 1999 No 11823/92 Jelica Helen Wainwright (by her tutor Jacob Pekjovic) v Jennifer Fuller & 2 Ors Reasons for judgment on costs

1 HIS HONOUR: The amount of the judgment in this matter, calculated in accordance with my reasons of 22 October and 17 December 1998, was almost seven million dollars. On 26 September 1996, while the case was part heard, the plaintiff made an offer of compromise under Part 22 of the Supreme Court Rules of roughly five million, seven hundred and fifty thousand dollars. Her counsel now seeks costs on an indemnity basis for the period after that date because the judgment is no less favourable than the terms of that offer: Pt 52A, r 22(4). 2 At the time the offer was made the plaintiff's particulars under Pt 33, r 8A did not include a claim for a night carer. That claim was made later in amended particulars and was allowed, the amount involved being in the order of one million, one hundred and fifty thousand dollars. Counsel for the plaintiff accepts that that sum should be deducted from the amount of the judgment for the purpose of comparing it with the amount of the offer: cf Van Doore v Mendez (Dunford J, unreported, 30 June 1997). Even so, the judgment exceeds the offer by about $48,000. 3 The policy behind a provision such as Pt 52A, r 22(4), and the principles governing the exercise of the discretion conferred by it, were summarised in Maitland Hospital v Fisher (No 2) (1992) 27 NSWLR 721 at 724-6: see also Morgan v Johnson (1998) 44 NSWLR 578 at 581-2. It is clear that a plaintiff is ordinarily entitled to an order for indemnity costs when the conditions of the sub-rule are met, and it would be only in an exceptional case that the Court would order otherwise. Is this that exceptional case? 4 To understand the argument of counsel for the defendants that it is, it is necessary to refer to the protracted history of the hearing. It proceeded intermittently over the period between 13 May 1996 and 24 April 1997. I did not give judgment until October of the following year. Calculations were then made to give effect to my reasons, the figures in relation to some heads of damage being brought up to date. A major head of damage, of course, was attendant care and on that matter I received further evidence of the rates paid to various levels of carer by Macquarie Nursing Service as at November 1998. This was the subject of my supplementary judgment of 17 December 1998. 5 For the purpose of the argument on costs, counsel for the defendants produced a schedule which purported to calculate the amount of the judgment if the heads of damages had been assessed in accordance with the particulars under Pt 33, r 8A of 10 May 1996. Those were the particulars on foot at the time the plaintiff's offer of compromise was made in September of that year. That calculation was adjusted somewhat in further written submissions. On this approach, and assuming the figures to be correct, the judgment would have totalled about five million, one hundred and thirty-one thousand dollars, roughly six hundred and seventeen thousand dollars less than the plaintiff's offer. 6 Counsel for the defendants submitted that this is how the judgment should be viewed in "real terms". He pointed out that the offer of settlement was made after the hearing had commenced, and at a time when the completion of the hearing and the delivery of judgment might have been anticipated in the relatively near future. This was not a case, he argued, where an offer was made at an early stage of the litigation, when the parties would have been aware that it would be a matter of years before the case could come to hearing. Reliance was placed upon the following passage from Maitland Hospital (supra) at 725: Litigation is inescapably chancy. The purpose of the rule is to put a premium on realistic assessment of cases. It is not to demand perfect foresight which is denied even to the judges. That is why a discretion is retained, under the rule, for the Court to order otherwise than as the rule provides. But the ordinary provision is expected to apply in the ordinary case. 7 The matter appears to be devoid of authority. Nevertheless, I can see the point of counsel's argument and I am conscious of the fact that my delay in delivering judgment accounts for much of the time which elapsed after the offer of settlement. On the other hand, as counsel for the plaintiff pointed out, delay in the completion of a hearing which has already commenced and in the delivery of judgment are not uncommon, and are matters to which regard should be had when considering an offer made at or about the time of hearing. In all the circumstances, I do not consider the present case to be so far out of the ordinary as to call for a departure from the usual approach. 8 Counsel for the defendants also argued that I should exercise my discretion in their favour, in any event, in the light of what was said to be the insignificant difference between the amount of the judgment and the plaintiff's offer. Forty-eight thousand dollars is a tidy sum but, it was said, it is minuscule in the light of the very large figures involved. It is less than one percent of the amount which the plaintiff was prepared to accept and an even smaller proportion of the amount awarded. 9 However, the fact remains that, using the terms of Pt 52A, r 22(4), the judgment is "no less favourable" than the offer. Similar arguments have failed to persuade other Courts: see Maitland Hospital v Fisher (supra) at 722, 724-5 and Connor v Hatgis (No 2) (Court of Appeal, unreported, 7 December 1995). As Kirby P and Priestly JA observed in the latter case, "it will often be the case that the indemnity cost rule will apply to offers close to the sum eventually recovered". 10 Accordingly, I am satisfied that the plaintiff is entitled to the order sought. The defendants should pay the plaintiff's costs on a party and party basis up to and including 16 September 1996, and thereafter on an indemnity basis. **********