New South Wales Court of Appeal CITATION: SINGH v HARIKA (NO.2) [2005] NSWCA 212 HEARING DATE(S): 20/04/2005 JUDGMENT DATE: 23 June 2005 JUDGMENT OF: Hodgson JA at 1; Bryson JA at 2; Campbell AJA at 14 DECISION: see [13] CATCHWORDS: COSTS - offer of compromise in District Court - defendant offered sum greater than judgment in District Court - formal offer under DCR Pt.39A - defendant recovered costs from date of offer as in Pt.39A r.25 - an appeal, no offer was made and plaintiff as appellant recovered higher award but still below offer - appellant recovered costs of appeal. District Court Rules Pt.39A r.25 LEGISLATION CITED: Supreme Court Act 1970; s.76 Supreme Court Rules Pt.52A r.22 Baresic v. Slingshot Holdings Pty Ltd (No.2) [2005] NSWCA 160 at [19]; Fotheringham v. Fotheringham (No.2) [1999] NSWCA 21, 46 NSWLR 194 CASES CITED: South Sydney Council v. Morris (No.3) [2001] NSWCA 200 Moore v. Woodforth (No.2) [2003] NSWCA 46 Brymount Pty Ltd v. Cummins [2005] NSWCA 69 Roselyne Singh - Appellant PARTIES: Amardeep Singh Harika - Respondent FILE NUMBER(S): CA 40808/2004 Mr D. Cassidy QC with Mr M. Rollinson - Appellant COUNSEL: Mr P.R. Garling - Respondent Newman & Associates, Sydney - Appellant SOLICITORS: Sparke Helmore, Sydney - Respondent LOWER COURT JURISDICTION: District Court LOWER COURT FILE NUMBER(S): DC 2159/00 LOWER COURT JUDICIAL OFFICER: Murrell DCJ IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL 40808 OF 2004 HODGSON JA BRYSON JA M. W. CAMPBELL AJA THURSDAY 23 JUNE 2005 ROSLYNE SINGH v. AMARDEEP SINGH HARIKA Judgment 1 HODGSON JA: I agree with Bryson JA. 2 BRYSON JA: These reasons deal with costs. This Court made orders disposing of the appeal on 12 May 2005, but directed that the orders should not be entered so that the parties could make written submissions dealing with costs. 3 The appellant as plaintiff claimed unlimited damages in the District Court by Summons dated 26 March 2000. The action was heard by her Honour Judge Murrell SC on 17 to 20 February and 23 and 24 August 2004 and decided on 31 August 2004. Judgment was then given and was later varied to award the appellant damages of $403,812. Judge Murrell ordered that the respondent pay the appellant's costs up to 21 September 2003 and that the appellant pay the respondent's costs from 22 September 2003. 4 The appellant appealed, contending that the damages were too low and also that they should not be reduced for contributory negligence. The Notice of Appeal claimed that the damages should be re-assessed, and that the respondent should be ordered to pay the appellant's costs of the entire action in the District Court and of the appeal. 5 The Court of Appeal allowed the appeal and increased the damages award to $491,812, an increase of $88,000. The Trial Judge's decision on contributory negligence was affirmed. The Court proposed to make orders as to costs under which the costs order of the District Court was to stand, and the respondent was to pay the appellant's costs of the appeal. However this was not a final decision and it was open to the parties to have it further considered. They have made short written submissions, and the Court can now dispose of costs. 6 The chronology is: 26 March 2000 Action commenced 22 September 2003 Offer of Compromise $700,000 + costs. 20 October 2003 Offer expires 17 February 2004 Trial begins 24 August 2004 Trial ends 31 August 2004 Judgment and costs order: damages $403,812 22 September 2004 Notice of Appeal 20 April 2004 Appeal heard 12 May 2004 Appeal allowed: damages $491,812. 7 The costs order made by Judge Murrell followed Pt.39A r.25 of the District Court Rules. The appellant did not obtain an order for the respondent to pay her general costs because there had been an offer of compromise. 8 The respondent contends that in the appeal the appellant should not recover a costs order in the ordinary course, and refers to the Offer of Compromise and to the various contentions made in the appeal, most of which were not successful. There were unsuccessful contentions on Contributory Negligence, Brain damage, a pathological relationship and on domestic assistance. The successful contention related to future economic loss being diminution of earning capacity, and the sum recovered was $88,000, which is a significant amount and an increase of the earlier award by about 22%. The appeal hearing took less than one day and the issues on which the appellant failed are unlikely to have added much to the costs overall. But for the offer of compromise costs would follow success on the appeal as of course. 9 Part 39A r.25 of the District Court Rules states the consequences of the offer of compromise. The facts fall within subrule (6), which Judge Murrell applied. There is no reason for the Court of Appeal to vary her order, which would still have been right if the District Court had awarded $491,812. 10 Part 39A r.25 deals with costs in the District Court and does not refer or relate to the costs of an appeal. Part 22 and Part 52A r.22 of the Supreme Court Rules apply to proceedings in the Court of Appeal and provide for costs consequences of offers of compromise, but do not give effect to offers made in other courts. No offer of compromise was made while the appeal was pending. The Court of Appeal exercises the discretionary costs power conferred by s.76 of the Supreme Court Act 1970, and the events relating to the Offer of Compromise in the District Court are relevant to that discretion: see Baresic v. Slingshot Holdings Pty Ltd (No.2) [2005] NSWCA 160 at [19]; and cf Fotheringham v. Fotheringham (No.2) [1999] NSWCA 21, 46 NSWLR 194; South Sydney Council v. Morris (No.3) [2001] NSWCA 200; Moore v. Woodforth (No.2) [2003] NSWCA 46 at [12]-[16]; Brymount Pty Ltd v. Cummins [2005] NSWCA 69 at [23]-[30]. 11 On the broadest view, if the appellant had accepted the Offer of Compromise she would have recovered more than she has been awarded, and the attainment of a just remedy was possible without there being any appeal, just as it was possible without her continuing with her District Court action after the offer expired: the respondent has been put to needless expense in the appeal. To take that view is to disregard important aspects of the appellant's position after she recovered damages in the District Court which (as this Court has decided) were less than her entitlement. She had good reason to appeal and no offer of compromise was then available to her: the offer of compromise is not a reason why the appellant should not have pressed for all she was entitled to, or why the respondent should have been discharged from liability for less than that. The order for costs in the District Court went as far as any Rules of Court require recognition of the respondent's having made $700,000 plus costs available to go. The respondent should not get some like protection in the Court of Appeal because it did not take any like risk, and did not make an offer of compromise. Still it is retrospectively clear that the appellant should have stopped the litigation in 2003, without any appeal. 12 When Murrell DCJ gave her decision, and at all times since then, the Offer of Compromise has had no continuing effect on the parties' conduct of their litigation. It would have been unjust if the earlier Offer of Compromise, which was no longer available, had been the factor which moved the appellant to decide not to appeal. The respondent's claims for consideration arising out of his Offer of Compromise have been recognized by the District Court's order, and in my judgment that recognition is sufficient. The appellant succeeded on her appeal, and should obtain the ordinary remedy in costs. 13 For these reasons the orders announced on 12 May 2005 should be entered. 14 MW CAMPBELL AJA: I agree with Bryson JA. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.