Petrovski v Radin [2000] NSWSC 323

New South Wales Supreme Court

CITATION : Petrovski v Radin [2000] NSWSC 323 CURRENT JURISDICTION: Common Law Division FILE NUMBER(S) : SC 20111/98 HEARING DATE(S) : 21 December 1999, 3 February 2000 JUDGMENT DATE : 19 April 2000

PARTIES : Miroslav Petrovski v Michael Radin JUDGMENT OF : Sperling J

(Plaintiff): J Anderson COUNSEL : (Defendant): M A Jones (Proposed Cross-defendant): R Newlinds (Plaintiff): Martin Bell & Co SOLICITORS : (Defendant): Henry Davis York (Proposed Cross-defendant): Moray & Agnew CATCHWORDS : COSTS - costs ordered in favour of a non-party. LEGISLATION CITED : Supreme Court Act 1970 Aiden Shipping Co Ltd v Interbulk Ltd [1986] AC 965 C E Heath Underwriting & Insurance (Australia) Pty Ltd v Daraway Constructions Pty Ltd (Batt J, Supreme Court of Victoria, 1 September 1995, unreported) CASES CITED : Knight v FP Special Assets Ltd (1992) 174 CLR 178 Symphony Group plc v Hodgson [1994] QB 179 Vestris v Cashman [1998] 72 SASR 449 Wentworth v Wentworth: Estate of the late George Neville Wentworth [1999] NSWSC 317 (1999) 46 NSWLR 300 DECISION : See paragraph No 19

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

SPERLING J

Wednesday, 19 April 2000

20111/98 Miroslav Petrovski v Michael Radin

HIS HONOUR: 1 This matter is listed for hearing before me on 26 April 2000. On 3 February 2000 as duty judge, I reserved the question of costs of a motion. The purpose of this judgment is to record the background of the case for the purpose of the hearing on 26 April 2000, and to give my decision on the reserved question of costs. 2 The plaintiff claims to have received two injuries in the course of his employment, the first on 10 October 1985 and the second on 10 April 1986. 3 In 1989, proceedings were instituted in the Workers Compensation Commission, claiming weekly compensation in relation to the first alleged injury. At the hearing of that application, in May 1991, the proceedings were amended to include a claim in relation to the second alleged injury as well. On 4 December 1991, an award of weekly compensation was made in relation to the second alleged injury. 4 On 1 December 1986, common law proceedings were commenced in the District Court in relation to the first alleged injury. The proceedings were transferred to the Supreme Court. They came on for hearing before Dunford J on 10 October 1997. Dunford J refused an application to add a claim in relation to the second injury because the limitation period for that injury had expired in April 1992. The plaintiff received a small verdict of $7,300 for a closed period. 5 The present proceedings were commenced on 9 April 1998. The plaintiff sues his former solicitor, Mr Radin, for negligence in failing to institute proceedings in relation to the second injury within time. 6 Ms A M Christopher, solicitor, has had conduct of the matter for the defendant, on instructions from Law Cover. In late 1999, she moved from one firm of solicitors to another with consequent change of the solicitors on the record. 7 In July 1998, Ms Christopher received instructions that Mr V Jurisich of counsel had been briefed for the plaintiff in both the workers compensation and the common law proceedings. His involvement in the common law proceedings was not, however, clear from the papers to which she then had access. In particular, there was no brief to advise in relation to the common law proceedings in those papers. On 29 July 1998, the defendant was given leave to file a cross-claim by 14 August 1998. That was not done because the nature and extent of Mr Jurisich's involvement was still not clear. The defendant's practice was in receivership. There was difficulty in locating the relevant file. In February 1999, the file was found but became unavailable again before it was inspected. The file was ultimately received for inspection in June 1999. At that stage, Ms Christopher was on maternity leave. The papers were reviewed by another solicitor in the firm in her absence. In October 1999, Ms Christopher reviewed the papers and formed the opinion that there was evidence that Mr Jurisich had been briefed to advise in relation to the common law proceedings. 8 The proceedings had been entered in the Professional Negligence List by order made on 21 July 1999. At a conference hearing on 22 October 1999, a further conference hearing was fixed for 7 December 1999. On that date, a notice of motion seeking leave to join Mr Jurisich of counsel as a cross-defendant was filed in court and made returnable before me on 21 December 1999. 9 The notice of motion was served on Mr Jurisich. On 21 December 1999, the defendant did not oppose Mr Jurisich appearing by counsel to contest the application. On the defendant's application, the notice of motion was adjourned to 3 February 2000. 10 On 3 February 2000, evidence having been filed in the motion pursuant to directions, the defendant announced that the notice of motion was withdrawn. Orders were sought on behalf of the plaintiff and Mr Jurisich that the defendant pay their costs of the motion. I made an order dismissing the notice of motion and reserved the question of costs. 11 More particularly, the order sought on behalf of the plaintiff was that the defendant pay the plaintiff's costs of 21 December 1999 and 3 February 2000 and part at least of the plaintiff's costs of 7 December 1999, on the ground that such costs were incurred only because of the defendant's notice of motion. The plaintiff also sought the costs of having served the plaintiff's medical case on Mr Jurisich. That was said to have been pursuant to an order or recommendation made by me on 21 December 1999. I have no note or recollection of that, but it was not disputed by other parties. So I will assume that I made such an order or recommendation. It was the sensible course for the plaintiff to take in the context of the defendant's notice of motion in any event, and should be seen as responsive to it irrespective of my role. 12 For Mr Jurisich, it is argued that the costs of motion should follow the event, that he has been put to expense in preparing to meet an application which the defendant has abandoned, and in appearing by counsel to answer the application. Mr Jurisich also argues that the application was always futile. 13 In answer to that, it is said that costs would be ordered in favour of a non-party only in exceptional circumstances, and that the application would have been avoided if Mr Jurisich had provided information sought by letter at an earlier time. 14 Section 76 of the Supreme Court Act 1970 provides, in general terms, that the Court may determine by whom and to what extent costs are to be paid. There is no more particular provision in the act or rules relating to a party being ordered to pay the costs of a non-party. Addressing a Queensland rule of court in similarly general terms, the High Court held that the rule should not be read down to preclude an order for costs being made against a non-party: Knight v FP Special Assets Ltd (1992) 174 CLR 178, per Mason CJ and Deane J at 192, per Dawson J at 202-3, per Gaudron J at 205, and per McHugh J at 207). It has been said that the power to order costs against a non-party should be exercised with caution: C E Heath Underwriting & Insurance (Australia) Pty Ltd v Daraway Constructions Pty Ltd (Batt J, Supreme Court of Victoria, 1 September 1995, unreported) and that such an order will be exceptional: Symphony Group plc v Hodgson [1994] QB 179 at 192; Aiden Shipping Co Ltd v Interbulk Ltd [1986] AC 965 at 980; Vestris v Cashman [1998] 72 SASR 449; Wentworth v Wentworth: Estate of the late George Neville Wentworth [1999] NSWSC 317, (1999) 46 NSWLR 300. 15 In the present case, it is relevant that Mr Jurisich was served with the notice of motion and that no objection was raised to him appearing by counsel to oppose it. This was a sensible arrangement. If that had not been done and leave had been granted ex parte to join Mr Jurisich as a cross-defendant, he would then have applied for summary dismissal of the cross-claim on the ground that it had no prospect of succeeding. The result in relation to the notice of motion shows that the outcome would then have been the same. In the ordinary course, the defendant would have been ordered to pay the costs of those proceedings. 16 The arrangement merely advanced the resolution of what was to happen in relation to the proposed cross-claim. In these circumstances, although Mr Jurisich was not a party to the notice of motion as a matter of form, he was a party as a matter of substance. The same order for costs should accordingly be made as would be appropriate if Mr Jurisich were a party to the notice of motion. 17 The only potential reason for not ordering that costs follow the event is the defendant's point about the unanswered correspondence. Generally speaking, a prospective defendant or cross-defendant is under no obligation to provide information likely to exculpate him, when there must be the risk that the information might be used to his detriment. The letter did not, in any event, warn Mr Jurisich that, if he did not provide the information, an application would be brought to institute proceedings against him. It was not a "letter before action". It is also speculative that the defendant would have accepted such information as sufficient, bearing in mind that the defendant has acted, in the event, on affidavit evidence as being a sufficient basis on which to decide not to proceed against Mr Jurisich. The defendant will be ordered to pay Mr Jurisich's costs of the notice of motion. 18 I come then to the plaintiff's claim for an order for costs. But for the notice of motion, the proceedings would have been transferred to the holding list on 7 December 1999, for a date to be fixed for hearing. There is nothing on the file to show that the attendances on 7 December or that any time occupied on that date were attributable to the defendant's wish to apply to join a cross-defendant. However, the plaintiff should have his costs of 21 December 1999 and 3 February 2000 and the costs of serving his medical case on the proposed cross-defendant. These costs are attributable to the notice of motion. 19 The orders I make are as follows: