Engstrand v Brisbane City Council [2010] QDC 35

DISTRICT COURT OF QUEENSLAND CITATION: Engstrand v Brisbane City Council [2010] QDC 35 PARTIES: KLAS ENGSTRAND Plaintiff AND BRISBANE CITY COUNCIL Defendant FILE NO/S: D2009/09 DIVISION: PROCEEDING: Application ORIGINATING COURT: District Court, Brisbane DELIVERED ON: 19 February 2010 DELIVERED AT: Brisbane HEARING DATE: 28 January 2010 JUDGE: McGill DCJ ORDER: Application dismissed with costs CATCHWORDS: COSTS – Security for – plaintiff ordinarily resident out of Australia – personal injury action – liability disputed – order would stifle action – security not ordered UCPR rr 670, 671(e) Barton v Minister for Foreign Affairs (1984) 2 FCR 463 – cited. Castillejo v Botella [2008] QSC 333 – considered. Connop v Varena Pty Ltd [1984] 1 NSWLR 71 – cited. Drumdurno Pty Ltd v Braham (1982) 42 ALR 563 – cited. Energy Drilling Inc v Petroz NL (1989) ATPR #40-954 - cited. Kent Heating Ltd v Cook-on Gas Products Pty Ltd (1984) 59 ALR 277 – cited. Logue v Hansen Technologies Ltd (2003) 125 FCR 590 – cited. Oulton v Brisbane Stevedoring and Wool Dumping Co Pty Ltd [1958] QWN 35 – cited. P.S. Chellaram & Co v China Ocean Shipping Co (1991) 65 ALJR 642 – considered. Yandil Holdings Pty Ltd v Insurance Co of North America (1986) 7 NSWLR 571 – cited. -- 1 of 8 -- 2 COUNSEL: L.T. Barnes for the plaintiff T. Houghton for the defendant SOLICITORS: McCowans Solicitors for the plaintiff King & Co Solicitors for the defendant [1] This is an application for security for costs, advanced on the ground that the plaintiff is ordinarily resident outside Australia, and has not sufficient assets within the jurisdiction to satisfy an order for costs. The plaintiff has some assets within the jurisdiction but these would not be enough to satisfy an order for costs. The plaintiff, however, is an individual and the application is made in a claim for damages for personal injuries. 1 Although residence out of the jurisdiction is a recognised category of matters where an order for security for costs can be made against a plaintiff, the application is resisted on the ground that in the particular circumstances of this case it would not be appropriate to make such an order, essentially on the basis that such an order would stifle a just claim. The claim [2] The plaintiff alleged that on 22 August 2007 he was injured while riding a bicycle along a bicycle path built and maintained, and occupied, by the defendant. 2 At a point where the bicycle path, which had been concrete, came to the edge of a wooden bridge there was a short sloping ramp of steel plate bordering the wooden surface, but running diagonally across the bikeway rather than at 90 degrees to its path. 3 As his front wheel crossed the ramp it became airborne, and when it landed on the wooden surface the tyre slipped causing him to fall to the side and injure himself; he suffered a fracture of the hip.4 [3] The pre-litigation procedures were completed in the ordinary way in accordance with the Personal Injuries Proceedings Act 2002, without the matter being resolved. A Part 1 Notice of Claim was served on or about 20 December 2007, the defendant denied liability in July 2008, and at a compulsory conference held on 30 June 2009 the matter did not settle. 5 [4] In the statement of claim (para 3) the plaintiff alleged that the injury was caused by the negligence of the defendant in failing to provide a bicycle path which was safe and not slippery particularly after wet weather, as was the case here, failing to provide appropriate warning signs of the slipperiness of the path in wet conditions or to cordon it off to prevent cyclists from being exposed to risk of injury, using a metal plate in such circumstances contrary to the Guide to Traffic Engineering Practice 1993, and using a timber surface which had less than an acceptable coefficient of friction. 1 A long list of examples of such cases in Colbram “Security for Costs” (1993) at pp 138-140 does not include any actions for damages for personal injuries. 2 Statement of Claim filed 21 July 2009. The defendant admits it had control over the bicycle path: Defence filed 19 August 2009 para 4(a). 3 Photographs of this are exhibited to the affidavit of Hemmings filed 28 January 2010, Exhibits DH42, DH43. 4 Statement of Claim paras 2(c), 5 5 Affidavit of Hemmings filed 28 January 2010 paras 4, 12; Statement of Claim para 8, deemed admitted. -- 2 of 8 -- 3 [5] In its defence filed 19 August 2009 the defendant denied that the pathway was unsafe, that there was any breach of the Guide to Traffic Engineering Practice 1993, that the timber surface provided an inadequate coefficient of friction, or that there was any necessity to provide warning signs or cordon off some or all of the pathway, and alleged that the fact that the pathway was wet was obvious to users of the pathway including the plaintiff, and that the defendant had discharged its duty of care to persons such as the plaintiff. It was alleged there had been no prior complaints about the surface of that part of the pathway, and that the defendant knew of no prior incidents. Contributory negligence was also alleged. [6] The defendant also relied on s 35 of the Civil Liability Act, alleging that its construction of this aspect of the bikeway was in accordance with its general procedures and applicable standards, and purported to rely on a large number of provisions of the same Act without, it seems, pleading the material facts which might make those provisions applicable, 6 or pleading what is relied on as flowing from such sections in the circumstances. The plaintiff filed a reply on 2 September 2009, and the application for security for costs was filed on 8 December 2009. The plaintiff [7] The plaintiff has been in the past a resident of Australia, and was at the date of the accident. He was a resident as a student between August 1998 and May 2001, during which time he met and married his wife, and was further resident in Australia from September 2003 until June 2008.7 His solicitor deposed to instructions that the plaintiff’s decision to return to Sweden was unrelated to the litigation, and that the plaintiff and his family intend to return to Australia in the future, although no particular time or triggering event was identified; the plaintiff’s wife and two children hold Australian citizenship. The defendant’s solicitors also point to the fact that the plaintiff’s solicitors stated on 30 April 2009 that the plaintiff has no intention of returning to Australia in the foreseeable future. 8 [8] The plaintiff has assets in Australia in the form of a superannuation account built up while he was working here in the past, and two bank accounts with Westpac. 9 The superannuation balance is a little over $25,000. The two bank accounts have balances which total under $1800. The plaintiff also has a bank account in Sweden, with a balance the equivalent of about $AUS29,000. No other assets are disclosed; inferentially, there are none of significance. [9] In Sweden the plaintiff is a salesman, and is receiving after income tax the equivalent of about $AUS1100 per week, from which he has to pay his living expenses and accommodation; his wife and two children are totally dependent upon him.10 His instructions are that these largely exhaust his net weekly earnings, but he is saving as much as he can because of concern about the long-term adverse effects of his injuries. 6 It may be that some, or possibly all, of the material facts relevant for those sections have already been pleaded by the defendant elsewhere, or pleaded by the plaintiff and admitted by the defendant. 7 Affidavit of Hemmings filed 28 January 2010 para 41. 8 Affidavit of Isaacs filed 8 December 2009, Exhibit DLI4. 9 Affidavit of Hemmings filed 28 January 2010 para 40. 10 Ibid para 50. -- 3 of 8 -- 4 [10] The plaintiff’s return to Sweden was not without notice to the defendant; in late April 2008 the plaintiff’s solicitors advised the defendant’s solicitors that the plaintiff would be travelling overseas on 27 June 2008 and asked whether the defendant wanted to have the plaintiff medically examined before he left the country.11 The law [11] Under UCPR r 671 the plaintiff may be ordered to give security for costs only if one of a number of matters is satisfied; the defendant submits the plaintiff is ordinarily resident outside Australia so as to satisfy paragraph (e). The question of whether a plaintiff is so ordinarily resident is something which has to be decided depending on the situation at the time of the application, but in circumstances where the plaintiff is living and working in a foreign country and has been for over 12 months, and has no intention of returning to Australia in the foreseeable future, even though he was previously ordinarily resident in Australia it is now fair to describe him as ordinarily resident outside Australia. 12 Rule 671(e) is therefore satisfied. I should say that I am not prepared to draw the inference that the plaintiff changed address to avoid the consequences of the proceedings, so that r 671(d) is not satisfied. [12] Once r 671 is satisfied, the discretion of the court under r 670 to make or refuse an order for security for costs is enlivened, but whether such an order should be made is a matter of discretion depending on the circumstances of the case. 13 Nevertheless, it has been recognised that there is a predisposition to make an order for security for costs in circumstances where a plaintiff is resident out of the jurisdiction and has no assets within the jurisdiction: McHugh J has said: 14 “For over 200 years, the fact that a party, bringing proceedings, is resident out of the jurisdiction and has no assets within the jurisdiction has been seen as a circumstance of great weight in determining whether an order for security for costs should be made. Indeed, for many years the practice has been to order such a party to provide security for costs unless that party can point to other circumstances which overcome the weight of the circumstance that that person is resident out of and has no assets within the jurisdiction.” [13] In that case, which involved security for costs of an appeal to the High Court of Australia for which special leave had already been granted, a director of the appellant had proffered an undertaking to meet any costs ordered to be paid up to a particular amount, and his Honour ordered that security for costs be given in this amount in a form to the satisfaction of the registrar. His Honour also said:15 11 Affidavit of Hemmings filed 28 January 2010 Exhibit DH2. The defendant’s solicitors took until April 2009 to decide that they wanted to have the plaintiff medically examined. 12 I have considered the discussion of the authorities to determine this, and similar matters, in Colbram, op cit, pp 146-7. 13 Barton v Minister for Foreign Affairs (1984) 2 FCR 463; P.S. Chellaram & Co v China Ocean Shipping Co (1991) 65 ALJR 642; Logue v Hansen Technologies Ltd (2003) 125 FCR 590 at [38]- [39]. At one time the approach of courts to this matter was much more mechanical: see the history given in Delany “Security for Costs” (1989) pp 26-27. 14 In Chellaram (supra) at p 643. 15 Chellaram (supra) at p 643. -- 4 of 8 -- 5 “I would hesitate to make an order for security for costs if the effect of that order would be that the appeal could not be pursued because neither the appellant nor those who stand behind it could provide security for the costs of the appeal.” [14] This reflects a broader concern which may be found in the authorities in relation to security for costs generally, a desire not to stifle genuine, and particularly apparently worthy, proceedings. 16 It does seem that this arises more commonly in the case of individuals rather than companies or businesses. [15] The purpose of an order for security for costs in such circumstances is to spare a successful defendant the risk, cost and trouble of seeking to enforce an order for costs in a foreign country.17 For that reason, where there exists a mechanism for the reciprocal enforcement of judgments such that an order for costs against the plaintiff can be enforced in a more expeditious and inexpensive way, an order for security for costs may be limited to the additional costs associated with such enforcement.18 However, it does not appear that there is any relevant convention which would facilitate the enforcement of an order for costs against the plaintiff in Sweden. None was relied on by counsel for the plaintiff. [16] A number of discretionary matters which are relevant are set out in r 672. So far as the current proceeding is concerned these apply in the following way. There is no evidence that anyone other than the plaintiff (and in a sense those dependent on him) are standing behind the proceeding, and the means of the plaintiff would appear to be quite limited. So far as the prospects of success or merits of the proceeding are concerned, there have been no admissions on the part of the defendant, and the effect of the Civil Liability Act is that it is generally more difficult to sue public authorities such as the defendant, in relation to matters such as the construction of a bicycle path. On the other hand, there is expert evidence before me to the effect that there are unsatisfactory features about the way in which this particular facility has been designed and constructed which are likely to have caused or contributed to this particular accident.19 [17] It also strikes me as inherently unsatisfactory to have a ramp of this nature running diagonally across the bicycle path, rather than at right angles to it. I am not an expert, but I would have thought on general principles of basic physics that placing the ramp at an angle would have had the effect of producing some instability as a result of the cycle being ridden over it, particularly if this occurred at some speed, and that could cause problems in circumstances where water on the next surface was making that surface more slippery than would otherwise be the case. There is also the consideration that there is evidence that since the time when this accident occurred to the plaintiff the defendant has changed the bicycle path at this place, specifically by removing part of the timber surface and the metal plate which previously acted as the ramp and replacing them with a patch of bitumen. 20 It may be of course that this change was coincidental, or related to a feature independent of 16 Yandil Holdings Pty Ltd v Insurance Co of North America (1986) 7 NSWLR 571. 17 Kent Heating Ltd v Cook-on Gas Products Pty Ltd (1984) 59 ALR 277 at 279; Energy Drilling Inc v Petroz NL (1989) ATPR #40-954. 18 Connop v Varena Pty Ltd [1984] 1 NSWLR 71. 19 Affidavit of Hemmings filed 28 January 2010, Exhibits DH39, DH40, DH41. 20 Affidavit of Hemmings sworn and filed 28 January 2010. -- 5 of 8 -- 6 the plaintiff’s accident, but the existence of changes after the time of an accident have generally been regarded as admissible and probative of an available precaution. 21 [18] The plaintiff was seen by an orthopaedic surgeon, Dr Hopcroft, on 6 June 2008 for the purposes of a report. 22 Dr Hopcroft noted that x-rays taken at the request of the general practitioner soon after the accident revealed clear evidence of a fracture of the greater trochanter. Such diagnosis had been made some days after the accident by another orthopaedic surgeon, who treated the condition conservatively. The condition improved but there has been some continuing pain in the right hip. Dr Hopcroft thought that there was likely to be some continuing improvement, that the injury was consistent with the stated cause, and that the plaintiff had been left with a permanent impairment of the right hip of 5%. It was likely that there will be some pain permanently which could interfere with work or other activities from time to time. There may be some post-traumatic degenerative arthritis in the right sacroiliac joint and right L5/S1 facet joint in the longer term. [19] Essentially it appears that Dr Hopcroft was concerned about long-term developments leading to a deterioration in the plaintiffs’ condition. The further report of his dated 2 March 2009 23 indicated that the plaintiff was highly likely to develop arthritic changes over the next 10 to 20 years which could well lead to a hip replacement in the longer term. Overall, therefore, it does appear that the plaintiff has suffered some significant physical injury which has caused some pain and suffering and some albeit temporary interference with employment, but more significantly may well lead to deterioration in the plaintiff’s condition in the future and substantial risk of future economic loss. On the face of it therefore, if the defendant was negligent in some way, then the plaintiff has suffered sufficient injury to make it worthwhile to sue. [20] In relation to the plaintiff’s prospects of success, as I say there is at least some evidence that in engineering terms what was constructed here was unsatisfactory, and for what it is worth my initial reaction is that this does not look safe. There was no affidavit evidence which suggests that the defendant is particularly likely to succeed on any of the defences pleaded. This is not a case where I can say that the plaintiff is quite likely to succeed on questions of liability and the only real issue is one of quantum, but overall on the material presently available I would expect that the plaintiff would probably succeed. There is certainly no reason to doubt the genuineness of the proceeding, and the contrary was not suggested on behalf of the defendant. [21] The plaintiff has only limited means, but that was not attributable to the actions of the defendant. As to whether the order for security for costs is oppressive, it is relevant to consider all the circumstances including the motives of those behind the litigation, 24 but there is no evidence that there was any relevant motive here. In particular, this is not a situation where a plaintiff is bringing the action to prove a point or to establish some principle, independent of the potential benefit of the litigation to the plaintiff personally. Assuming the plaintiff did suffer the injury 21 Oulton v Brisbane Stevedoring and Wool Dumping Co Pty Ltd [1958] QWN 35. 22 Affidavit of Hemmings filed 28 January 2010 Exhibit DH4. 23 Affidavit of Hemmings filed 28 January 2010 Exhibit DH7. 24 Drumdurno Pty Ltd v Braham (1982) 42 ALR 563. -- 6 of 8 -- 7 identified by Dr Hopcroft in the way described, the plaintiff is simply seeking some compensation for his injury. In such circumstances, an order for security for costs could well be oppressive. [22] It also could well stifle the proceeding. Although on the hearing of the application the defendant reduced the amount sought as security to $29,000, an amount less than the amount available to the plaintiff in his bank account in Sweden, effectively the defendant is seeking to have the plaintiff put up by way of security the whole of his savings. I think it very likely that such an order would have the effect of stifling the proceeding, given the situation of the plaintiff and his family responsibilities. It is necessary to bear in mind that the risk of the proceeding being unsuccessful would impact much more severely on the plaintiff than on the defendant, and it is likely to be felt much more acutely by the plaintiff than the defendant. There must be a huge number of occupier’s liability claims brought against the defendant all the time, but plaintiffs are likely to be particularly focused on the prospects of their own proceedings, and to be particularly wary about the risk of failure. [23] In the circumstances therefore, although in theory the order sought could be satisfied by the plaintiff, I think it very likely that the practical effect of making such an order would be to stifle the proceedings. In this respect, the matter can be easily distinguished from Castillejo v Botella [2008] QSC 333, where there was no suggestion that the provision of security for costs by the plaintiff who resided in Spain would involve any financial hardship on his part: [31]. In that case there were several plaintiffs, an individual and a company in Spain and two companies in Australia, neither of which had any significant assets, and an order for security for costs was made. The evidence was that the Spanish individual and the Spanish company had quite substantial assets in Spain. [24] There was no suggestion that this proceeding involves a matter of public importance, except perhaps in the somewhat ephemeral sense that it could be suggested that one of the functions of civil litigation is to encourage potential defendants to refrain from behaving in a way likely to be found negligent, and in this way to encourage the defendant, and I suppose other local authorities, to maintain a high standard of safety when designing bicycle paths, a factor which can be seen to be in the interests of those who use such a facility.25 However, personally I doubt the connection between individual court decisions and the general conduct of defendants in the related area, and would not attribute any great significance to this somewhat indirect connection. [25] There has been no admission or payment into court,26 there is no suggestion of any real delay in starting the proceeding other than that made necessary by the need to comply with the pre-litigation procedures, an order for costs against the plaintiff would not to any significant extent be enforceable within the jurisdiction, and the costs of the proceeding would I expect be much the same as the cost of any other relatively straightforward personal injury trial in the District Court. There was some issue taken by the solicitors for the plaintiff with the estimate of the costs of the trial of $38,820 anticipated by the solicitors for the defendant,27 but in 25 See Fleming “Law of Torts” (9 th Ed 1998) p 10. 26 I assume there was a mandatory final offer under s 39 of PIPA, but that is not analogous. 27 Affidavit of Garrett filed 8 December 2009, Exhibit IAG4, an assessment by a costs assessor. It is not entirely clear that the assessment reflects costs recoverable on the standard basis. -- 7 of 8 -- 8 circumstances where the defendant is only pressing for an order that security be given in the amount of $29,000, this is probably academic and it is not necessary for me to look closely at these details. My impression is that the estimate is a fairly generous one. Analysis [26] The fact that the plaintiff is ordinarily resident overseas is itself a significant factor favouring the making of an order for security for costs. But it is necessary to look at all the relevant considerations. This is a case where I believe making an order for security for costs would have the effect of stifling the litigation, or at the very least it would impose serious hardship on the plaintiff if he wanted to continue it. This is a claim for damages for personal injury, and it seems reasonably clear that the plaintiff has actually suffered a real injury for which some reasonable amount of damages might be expected to be payable if the injury was caused by the negligence of the defendant. The defendant accepts that it is responsible for the state and condition of the cycleway; the only real issues are whether the defendant was negligent and contributory negligence. On the materials presently available, the plaintiff seems to have reasonably good prospects on liability, although I acknowledge that liability is disputed and accept that there may well be some real prospect of the defendant succeeding or obtaining some allowance for contributory negligence. [27] There is also the consideration that the defendant is a large local authority which is no doubt the subject of a large volume of litigation, particularly in relation to its occupation of public places. I expect the defendant is successful in a proportion of this litigation, and I expect that it would not be unusual for the defendant to have difficulty in enforcing orders for costs obtained against plaintiffs in many of those matters, so that it must be common enough for the defendant to be left with an order for costs which it cannot, or cannot effectively, enforce. This is no doubt just part of the ordinary cost of being a local authority in Australia. 28 [28] If the plaintiff were still living in Australia there would be no question of an order for security for costs against him, though the defendant might still expect that there would be difficulties in enforcing any order for costs if the matter went to trial and the defendant was successful. The fact that the plaintiff has chosen, no doubt for personal reasons, to return to Sweden between the time of the injury and the time of the action is not a sufficient reason why he should be subjected to what I do not doubt would in practice prove a barrier to the opportunity to pursue what looks to me on the face of it like a good claim. [29] In those circumstances I consider that, bearing in mind all of the factors referred to, the prospect of an order for security for costs stifling the claim outweighs the consideration that the plaintiff is resident out of the jurisdiction, and I will not make an order for security for costs. The defendant’s application is therefore dismissed with costs. 28 I think the position would be essentially the same if the defendant were insured against the liability alleged by the plaintiff; one of the things that one is covered for by insurance is the legal cost of defending claims including those where the defence is successful, and the insured is unable to enforce an order for costs. -- 8 of 8 --