New South Wales Supreme Court CITATION : Wilson v Carter & 5 Ors; Wilson v Rigg [2006] NSWSC 88 HEARING DATE(S) : 14 February 2006 JUDGMENT DATE : 2 March 2006 JURISDICTION : Common Law JUDGMENT OF : Rothman J at 1 DECISION : Proceedings 20364/1998; (a) The amended second cross-claim in proceedings 20364/1998 be struck out;; (b) As a consequence of Order (a) above, the third cross-claim in proceedings 20364/1998 be struck out;; (c) The cross-claimant to the second cross-claim pay the costs of the cross defendant to the second cross-claim, including the costs of the notice of motion in proceedings 20364/1998, as assessed or agreed, to be payable forthwith;; Proceedings 20447/2001; (d) In proceedings 20447/2001, the entirety of paragraph 33(a) of the Further Amended Statement of Claim be struck out;; (e) In proceedings 20447/2001, in the second cross-claim, the following paragraphs are struck out:; (i) Paragraph 11 insofar as it repeats paragraphs 16, 17, 20, 21, 22, 23, 24, 25 and 26 of the Further Amended Statement of Claim;; (ii) Paragraphs 12, 13, 14 and 15 in their entirety.; (f) The fifth defendant in proceedings 20447/2001, Jack Rigg, pay one third of the second cross defendant's costs of the motion in proceedings 20447/2001 as assessed or agreed, the second cross defendant being Mr S Stanton;; (g) Two thirds of the plaintiff's costs of the motions will be the plaintiff's costs in the cause in 20447/2001;; (h) A further one third of the costs of the motion in proceedings 20447/2001 of the third defendant, Mr S Stanton, will be the third defendant's costs in the cause. CATCHWORDS : Form of orders and Costs - apportionment - generally successful party - broad brush approach - overall assessment Wilson v Carter & 5 Ors [2005] NSWSC 1351 CASES CITED : Walmsley v Cosentino [2001] NSWCA 403 Oshlack v Richmond River Council (1998) 193 CLR 72 Plaintiff - Mark Wilson 1st Defendant - Trevor Carter 2nd Defendant - Clive Evatt PARTIES : 3rd Defendant - Stephen Stanton 4th Defendant - Gregory Stanton 5th Defendant - Jack Rigg 6th Defendant - Michael Rollinson FILE NUMBER(S) : SC 20364/1998; 20447/2001 Plaintiff - Mr H Stowe COUNSEL : 3rd Defendant - Mr W Willliams SC 5th Defendant - Ms K Rees Plaintiff - Sweeney Tiggermann Lawyers 1st Defendant - Yeldham & Associates 2nd Defendant - Minter Ellison Solicitors SOLICITORS : 3rd Defendant - McCabe Terrill Lawyers 4th Defendant - self represented 5th Defendant - Mallesons Lawyers 6th Defendant - Colin Biggers & Paisley - 7 - IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION Rothman J 2 March 2006 WILSON v CARTER & 5 ORS 20447/2001 WILSON v RIGG 20364/1998 JUDGMENT 1 HIS HONOUR: On 22 December 2005 I published reasons for judgment in relation to notices of motion in these two matters. The judgment makes clear that the applicant on the notices of motion was successful in part and unsuccessful in relation to one aspect of that motion. I refer to the reasons for judgment (Wilson v Carter & 5 Ors [2005] NSWSC 1351) which describes the nature of the proceedings and the claims against Mr Stanton, the applicant, and the grounds of that application. 2 The reasons for judgment concluded with proposed orders, upon which proposed orders I invited submissions, particularly on the question of costs. The matter came before me on 1 February 2006 and again on 14 February 2006 on the form of orders and the appropriate order as to costs. 3 There are essentially three issues with which the Court is asked to deal. They are: a The appropriateness of striking out allegations of fact and/or particulars; b The cost of the second cross-claim in proceedings 20364/1998 in totality (and not just confined to the costs on the notice of motion); c The appropriate apportionment of costs as between the applicant on the motion and the two respondents to the motion. 4 By proposed order (c), published with the reasons for judgment on 22 December 2005, I intimated a willingness to strike out the entirety of paragraphs 27(a), 27(b) and 33(a) of the Further Amended Statement of Claim. There is no issue concerning paragraph 33(a). The respondents to the motion submit that paragraphs 27(a) and 27(b) should not be struck out as they only allege factual material, which factual material is also relevant to the extant claim against Mr S Stanton. The applicant submits that not only ought those particular sub-paragraphs be struck out but that the particulars relating thereto should be struck out also. 5 It is the case that paragraphs 27(a) and 27(b) of the Further Amended Statement of Claim allege facts. The relevant particulars also allege facts. Those facts go to, inter alia, the nature of the retainer of Mr S Stanton and the particulars of the terms (or some of them) of that retainer. It is not immediately obvious why some of those particulars and some of the pleadings are relevant to the only remaining aspect of the claim against Mr S Stanton, but they are allegations of fact. Some allegations of fact may be, and in some limited respects certainly are, relevant to the determination of the claim sought to be made: that the duty in Walmsley v Cosentino [2001] NSWCA 403 is applicable to barristers and was breached by Mr S Stanton. Presumably the fact that he was briefed and the terms of that brief are relevant to the existence of the duty. 6 The respondents to the motion have made clear to the Court that their application to leave in paragraphs 27(a) and 27(b) is for the purpose of enabling their utilisation only as an allegation of fact and not, by some circuitous route, to litigate a duty based upon those matters. I have already decided to strike out any claim based on such a duty. On the basis of that statement by the respondents, I am prepared to allow paragraphs 27(a) and 27(b) of the Further Amended Statement of Claim in proceedings 20447/2001 to remain in and do not strike out the particulars relating thereto. Costs of the Second Cross-Claim in the 1998 Proceedings 7 The effect of the decision to strike out the Second Cross-Claim against the cross defendant in proceedings 20364/1998 is that the 1998 proceedings no longer involve Mr S Stanton. It is appropriate, in those circumstances, that the costs of the proceedings so far incurred by Mr S Stanton should be the subject of an order and I make an order that the cross claimant, Mr Rigg, pay the costs of the cross defendant, Mr S Stanton, of the second cross-claim. Costs of the Motion 8 The order proposed by me on 22 December 2005 deliberately contained an unusual proposal in relation to costs of the motion. This is because of the overall impression that I had of the manner in which the motions were argued and the results of the motions. 9 It is trite that usually the Court will order that the costs of the successful party be paid. In that sense, costs will follow the event. (See UCCP Rules 42.1) It is important to understand that costs are not awarded to punish an unsuccessful party but rather to indemnify the successful party against that which is reasonably incurred in enforcing that party's rights. (See Oshlack v Richmond River Council (1998) 193 CLR 72 at [67] and [68], per McHugh J) 10 In the current situation, general statements of principle do not resolve the issue. The proceedings with which the Court is dealing currently are interlocutory proceedings in which the applicant has been partly, dare I say predominantly, successful, but not wholly successful. The issue of costs is further complicated because the two proceedings are being heard together; in one the applicant is joined only by way of cross-claim and in the other the applicant is named as a defendant and cross defendant. The issues pleaded in one overlap with those in the other. Further, one of the respondents, a cross claimant against Mr S Stanton in the 1998 proceedings, is a defendant in the 2001 proceedings against whom similar allegations of negligence are levelled. Further, the plaintiff was required to be involved in the notice of motion insofar as it related to the 1998 proceedings, notwithstanding that, at least formally, he had no interest in the notice of motion pertaining to those proceedings. 11 Counsel for the plaintiff urged upon the Court that, at least in relation to the 2001 proceedings, the issues that were argued were "equally divided" and that no party was "generally successful". It was further argued that the issue associated with the application of the Walmsley v Cosentino claim was "discreet [sic], clearly separable, highly significant and of equal importance to the claim on which he succeeded." Moreover Counsel suggested that the "dismissal of the defendant's strike out application establishes (once and for all): a There was no proper foundation for the application …" 12 As I made clear in the reasons for judgment on 22 December 2005, the extension of a Walmsley duty to barristers is without precedent. To succeed the plaintiff must extend the law in a way for which there is currently no authority. It was considered by me that, given such an extension may depend upon factual issues associated with the precise terms of the retainer held by Mr S Stanton, the plaintiff should have the ability to establish facts which may allow the duty to be extended in the circumstances of this case. To describe the application for strike out on that basis as disclosing "no proper foundation" is gross hyperbole. 13 Further, as already explained, it is not my assessment that the Walmsley duty was "of equal importance" in terms of the time and effort required on the motion. 14 Taking a broad approach to the time each issue required in terms of argument and would reasonably require in terms of preparation, I came to the following conclusions: a The issues were divided equally between the 1998 and 2001 proceedings and I allow, as between them, 50% of the costs of the motion to each; b The time taken to argue the Walmsley duty was about one sixth the total time (i.e. one third of the 2001 proceedings); c On every other issue the applicant on the notices of motion was successful; d The plaintiff was successful on the issue which occupied about one sixth of the total time taken for the motion (about one third of the nominally allocated time taken by the 2001 proceedings) but was required, because of the involvement by Mr Rigg of Mr S Stanton in the 1998 proceedings, to be involved in some aspects, if not all aspects, of the notice of motion in relation to those proceedings. 15 In the circumstances I considered that two thirds of the costs of the applicant, Mr S Stanton, should be paid by way of compensation and that the plaintiff should have redress for the costs it has incurred and upon which it was otherwise successful. In so doing, I took the view that the applicant was successful in five-sixths of the claim, allowed him costs in that proportion, and deducted from that five-sixths the liability to pay costs in relation to one sixth (i.e. I allowed four-sixths or two-thirds). Likewise, the plaintiff was entitled to his costs in relation to one sixth of the motion and some compensation for the necessity to participate in that part of the motion that dealt with the 1998 proceedings, and was, in part, liable for costs in relation to any compensation due to the applicant. 16 I have heard the parties on this question and accept that some changes ought be made to the proposed orders, even allowing for the stated rationale to which I generally adhere. Having decided to order costs in relation to the second cross-claim in the 1998 proceedings, that, too, must be taken into account in determining the appropriate order for costs. 17 In the circumstances, I make the following order: Proceedings 20364/1998 a The amended second cross-claim in proceedings 20364/1998 be struck out; b As a consequence of Order (a) above, the third cross-claim in proceedings 20364/1998 be struck out; c The cross-claimant to the second cross-claim pay the costs of the cross defendant to the second cross-claim, including the costs of the notice of motion in proceedings 20364/1998, as assessed or agreed, to be payable forthwith; Proceedings 20447/2001 d In proceedings 20447/2001, the entirety of paragraph 33(a) of the Further Amended Statement of Claim be struck out; e In proceedings 20447/2001, in the second cross-claim, the following paragraphs are struck out: i. Paragraph 11 insofar as it repeats paragraphs 16, 17, 20, 21, 22, 23, 24, 25 and 26 of the Further Amended Statement of Claim; ii. Paragraphs 12, 13, 14 and 15 in their entirety. f The fifth defendant in proceedings 20447/2001, Jack Rigg, pay one third of the second cross defendant's costs of the motion in proceedings 20447/2001 as assessed or agreed, the second cross defendant being Mr S Stanton; g Two thirds of the plaintiff's costs of the motions will be the plaintiff's costs in the cause in 20447/2001; h A further one third of the costs of the motion in proceedings 20447/2001 of the third defendant, Mr S Stanton, will be the third defendant's costs in the cause. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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