Elton v Bywater Medical Management P/L (No. 2) [2011] QDC 138

DISTRICT COURT OF QUEENSLAND CITATION: Elton v Bywater Medical Management P/L (No. 2) [2011] QDC 138 PARTIES: ROSLYN ELTON plaintiff V BYWATER MEDICAL MANAGEMENT PTY LTD ACN 114 267 613 defendant FILE NO/S: 1604/08 DIVISION: Civil PROCEEDING: Claim ORIGINATING COURT: District Court, Brisbane DELIVERED ON: 22 July 2011 DELIVERED AT: Brisbane HEARING DATE: On the papers JUDGE: Dorney QC DCJ ORDERS: 1. The interest awarded on the plaintiff’s damages is $2,932.36. 2. The defendant pay the plaintiff’s costs of the Claim to be assessed on the standard basis. 3. The defendant pay the plaintiff’s costs of the Counterclaim brought against her by the defendant to be assessed on the standard basis. CATCHWORDS: Interest – Costs – Calderbank offer – r 361 of UCPR inapplicable Legislation: Corporations Act 2001 (Cth), 1337E Magistrates Court Act 1924 (Qld), s. 4 Uniform Civil Procedure Rules 1999 (Qld), rr. 5, 181, 182, 361, 681, 697 -- 1 of 5 -- 2 Cases: Anderson v AON Risk Services Australia Ltd & Anor [2004] QSC 180 – cited Astway Pty Ltd v Council of the City of the Gold Coast [2007] QSC 224 – applied Jones v Millward [2005] 1 Qd R 498 - applied Kozak v Matthews (as Executrix of the Will of Messer deceased) [2007] QSC 204 – applied Yara Nipro P/L v Interfert Australia P/L [2010] QCA 164 at [7], [15]-[16] – cited COUNSEL: R E Reed for the plaintiff S C Fisher, solicitor, for the defendant SOLICITORS: Just Us Lawyers for the plaintiff Neumann Turnour Lawyers for the defendant -- 2 of 5 -- 3 Introduction [1] On 23 June 2011 I made orders by which I gave leave to both parties to file written submissions with respect to calculations of interest and to costs, as a result of judgment on both the Claim and Counterclaim. [2] Both parties have, in a timely way, filed such submissions. Calculation of interest [3] The defendant’s submissions raise no issue as to how the interest sums should be calculated. [4] Accordingly, since the plaintiff’s submissions do – and appear, on their face, to be appropriately calculated – I intend to make orders in a form consistent with those calculations. [5] Hence, for the period from 3 April 2008 to 3 October 2008 there will be an award of interest as $246.83. In the period from 4 October 2008 to 23 June 2011 there will be a further award of interest of $2,785.53. In total, the award for interest will be $2,932.36. Costs of plaintiff’s Claim [6] The plaintiff succeeded in her claim to the extent of damages being awarded in the sum of $9,873.28, together with the interest just referred to. [7] It is accepted by both parties that that sum has always been below the jurisdiction of the Magistrates Court. [8] Although rule 681 of the Uniform Civil Procedure Rules (UCPR) contains the general provision as to costs, it is obvious that rule 697 can, in appropriate circumstances, modify the effect of that general provision: see rule 681(2). [9] Rule 697(1) states that rule 697(2) applies if relief obtained by a plaintiff in a proceeding in the District Court is a judgment that, when the proceeding began, could have been given in the Magistrates Court. As already indicated, there is no dispute between the parties that that subrule applies. [10] Although rule 697(2) states that the costs that a plaintiff may recover “must” be assessed as if the proceeding had been started in the Magistrates Court, an exception exists (namely, “unless the court orders otherwise”). [11] Unsurprisingly, the plaintiff urges that the exception should apply, whereas the defendant urges the application of the subrule. [12] The basis of the plaintiff’s case is that, although the plaintiff’s Claim was instituted on 17 June 2008, the defendant’s Counterclaim, initiated on 24 December 2008, could not have been brought in the Magistrates Court because it contained a claim for injunctive relief. Further, that claim was maintained throughout the various iterations of the pleading. It cannot be contested that s 4 of the Magistrates Court Act 1924 is not to such effect. And it cannot be argued that the defendant withdrew any reliance upon that claim before, or during, the trial. -- 3 of 5 -- 4 [13] The defendant’s contention is that there is no basis upon which this Court should order “otherwise”. While it is true that the plaintiff has sought no equitable relief, it is important, as the plaintiff contends, to embark upon a consideration of whether the claim would have been ordered to be transferred to the Magistrates Court in circumstances where the Counterclaim was of the nature indicated. [14] It is clear from a reading of my reasons for decision published 23 June 2011 that the issues raised in the Counterclaim required a consideration of some of the circumstances which formed the basis of the plaintiff’s claim. In such circumstances, it would be very difficult, not impossible, to imagine that any court would have transferred such a Claim to the Magistrates Court to be heard separately from the hearing of the Counterclaim. [15] In which case, that is an important factor in the consideration whether the exception in rule 697(2) of the UCPR applies. As noted in the plaintiff’s submissions, the contemplation of such a course would have been contrary to the philosophy of the UCPR as expressed in rule 5, particularly in the circumstances where rules 181 and 182 of the UCPR contemplate the hearing of a counterclaim at a the trial of the claim. [16] Thus, since both the Claim and Counterclaim proceeded together to be heard in the District Court, and that that course was appropriate, I am of the view that the costs should be in accordance with the District Court Scale. [17] I intend, therefore, to order that the defendant pay the plaintiff’s costs of the claim to be assessed on the standard basis. Costs of the Counterclaim [18] Although the defendant contends, alternatively, that there should be no order as to costs on the Counterclaim, there is no reason why the plaintiff should not have her costs in successfully defending the defendant’s claim brought against her by way of Counterclaim. [19] The first issue arises from the date of the relevant email being 13 April 2008, instead of 3 April 2008 (as believed by the defendant). Although decisive in the determination of the issues that were raised, the mistaken belief of the defendant cannot be attributed, in a blameworthy way, to the plaintiff. Although the plaintiff’s List of Documents describe, in Item 12, both that the relevant document was an email and that it had a date on it, since it was always one of the very significant documents in the case, it should have been obvious to the defendant from the beginning that it would need, pursuant to the disclosure rules, to have that document inspected or produced at a very early stage. Accordingly, although it is obvious that non-disclosure of material evidence can be a factor relevant to refusing to award indemnity costs in the context of the “offer to settle” regime, there is nothing in this present discussion which would lead to that circumstance being found to be a relevant factor here. [20] Turning, then, to the other issue raised by the defendant (namely, the issue of the District Court’s jurisdiction to entertain a claim for damages for breach of s 183 of the Corporations Act 2001), the typographical error in paragraph [65] of my reasons for decision – which error was obviously the substitution of the figure “4” for the -- 4 of 5 -- 5 letter “F” – was simply part of the discussion, in an obiter dicta context, concerning the breadth of s 1337E of the Corporations Act. It was not relevant to the discussion here. It is not to the point that it would have provided no bar to a transfer to the Magistrates Court, when the other matters just canvassed indicate that they would have provided an appropriate basis for non-transfer. [21] The plaintiff relies upon an “offer to settle” which it readily concedes, although stated to the contrary in the letter in question, was not in accordance with Part 5 of Chapter 9 of the UCPR. As is conceded by the plaintiff, the reason that the letter was not compliant is that the UCPR does not provide for any costs’ sanction in circumstances where a defendant to a counterclaim invites the party bringing the counterclaim to discontinue in advance of the trial. This is because rule 361 does not, in terms, deal with the situation in which a plaintiff by counterclaim fails entirely. As held in Astway Pty Ltd v Council of the City of the Gold Coast [2007] QSC 224, this is because the “plaintiff” has not obtained any “judgment”: at [15]. But it is still open to a court to make “another order” under rule 681 of the UCPR: at [15], although referring to the rule before its renumbering. But, as Kozak v Matthews (as Executrix of the Will of Messer deceased) [2007] QSC 204 shows, a formal offer made by the defendant may still be treated as a Calderbank offer: at [4]. [22] On approaching this issue on the basis that the Calderbank principles are applicable, I accept the submissions of the defendant – which was the plaintiff by counterclaim – that, effectively, the defendant was being asked to “capitulate rather than to compromise”. This term is taken from Jones v Millward [2005] 1 Qd R 498 where the Queensland Court of Appeal, in the leading judgment of Holmes J (as she then was), accepted as an appropriate analogous principle with respect to the UCPR that a “proposal which demands nothing less than all the relief sought”, “plus costs”, is “not in truth an offer to settle”: at 500. Since it is clear from those cases considering Calderbank letters that the same guiding principles apply to offers made pursuant to that course that apply, for instance, on appeals (see Yara Nipro P/L v Interfert Australia P/L [2010] QCA 164 at [7], [15]-[16]), the “offer to settle” contained in the letter of 31 August 2010 was not, in truth, an offer to compromise. If the approach taken by the courts is that illustrated by Anderson v AON Risk Services Australia Ltd & Anor [2004] QSC 180 at [10], referred to in Astway (at [15]), is the applicable approach, then there are either countervailing circumstances (in the form of there being no proper offer) or the nature of the offer does not engage the approach. It is, therefore, unnecessary to consider the further arguments advanced by both parties on this issue. [23] Accordingly, I will limit the costs that the defendant is to pay the plaintiff as to the Counterclaim to those to be assessed on the standard basis. Costs Orders [24] The costs orders that I intend to make are: 1. that the defendant pay the plaintiff’s costs of the Claim to be assessed on the standard basis; 2. that the defendant pay the plaintiff’s costs of the Counterclaim brought against her by the defendant to be assessed on the standard basis. -- 5 of 5 --