Bruhn v Power Hotels Pty Ltd [1993] QSC 190

i .I IN THE SUPREME COURT OF QUEENSLAND No. 2899 of 1998 Brisbane Before Justice White [Re: Loretta Diane Bruhn] BETWEEN: AND: CATCHWORDS: Counsel: Solicitors: Hearing Dates: Plaintiff POWER HOTELS.:·PTY:';LTD·' · .~.;.::.:.~.u,;:_,,.,.,:~.,~-::,·~::.;·~f.~,: . .- ., . ··. ;-~··· Defendant REASONS FOR JUDGMENT- WHITE J. Costs: 0.26 Mr. J. Batch for plaintiff Mr. R. Alldridge for defendant Adamson Bernays Kyle & Jones by their town agents watkins Stokes Templeton for the plaintiff · Cleary & Hoare for the defendant 20 July 1993 -- 1 of 8 -- IN THE SUPREME COURT OF QUEENSLAND BETWEEN: AND: LORETTA DIANE BRUHN POWER HOTELS PTY. LTD. No. 2899 of 1988 Plaintiff Defendant REASONS FOR JUDGMENT Judgment delivered 21 July 1993 WHITE J. Judgment was given in this action on 19th July, 1993 for the plaintiff against the defendant in the sum of $224,620.28. The action was one for damages for personal injury occurring at the plaintiff's place of work. By consent the plaintiff accepted a 30 per cent responsibility for her injuries. The total amount calculated to represent the plaintiff's loss and damage was $428,171.29. After apportionment the amount reduced to $299,719.91: The amount required to be deducted on account of Workers' Compensation Board payment was $75,099.43. This then resulted in the judgment sum of $224,620.28. Mr Batch of Counsel who had not appeared in the trial appeared on behalf of the plaintiff to receive judgment. He was not instructed by anyone on behalf of the plaintiff's solicitors. I invited submissions as to costs after giving judgment and publishing my reasons. Mr Batch said:- -- 2 of 8 -- 2 "We seek the costs, of course, Your Honour. HER HONOUR: I don't know about 'of course'. I don't know what things might have occurred. MR BATCH: There are certain offers that were made. I think none of the offers that were made on either side would affect the costs following the event, given the amount Your Honour has determined. HER HONOUR: That's so, is it, Mr Alldridge? MR ALLDRIDGE: No, Your Honour. HER HONOUR: I take it there is no submission then contrary to the usual order as to costs? MR ALLDRIDGE: No. HER HONOUR: I further order that the defendant pay the plaintiff's costs of and incidental to the action - are there any reserved costs? MR ALLDRIDGE: Not that I am aware of, Your Honour." On 20th July Mr Batch applied to have the question of costs reconsidered on the ground that an offer of settlement pursuant to 0.26 of the Rules of the Supreme Court had been made on behalf of the plaintiff on 18th September, 1992 in an amount less than that recovered by the plaintiff. The bringing of the application was not contested, the order for judgment not having been passed. The plaintiff seeks her costs on a solicitor and client basis. Order 2 6, rule 9 ( 1 ) provides:- "Where the plaintiff makes an offer to settle which is not accepted by the defendant and the plaintiff obtains a judgment no less favourable than the offer to settle the Court shall order the defendant to pay the plaintiff's costs fixed on a solicitor and clientbasis, unless the defendant shows that another order for costs is proper in the circumstances. 11 -- 3 of 8 -- 3 The issue is whether the offer to settle included or excluded the amount of the Workers' Compensation Board refund. The offer relevantly provided:- "TAKE NOTICE that the Plaintiff hereby offers to accept the sum of TWO HUNDRED AND EIGHTY THOUSAND AND FORTY-TWO DOLLARS ($280,042.00) plus the Plaintiff's party/party costs and outlays of and incidental to the action including reserved costs and costs in the cause to the date of service of this offer in full and final satisfaction of the Plaintiff's claim against theDefendant. 11 The offer had been preceded by an offer to ~ettle from the defendant pursuant to 0. 26 dated 9th September, 1992. The relevant terms of that offer were:- 11 ••• that the Defendant hereby offers to pay to the Plaintiff the sum of ONE HUNDRED THOUSAND DOLLARS ($100,000.00) exclusive of any refund due by the Plaintiff to the Workers' Compensation Board of Queensland plus the Plaintiff's party /party costs ... 11 After receipt of the plaintiff's offer the defendant's solicitor wrote by letter dated 23rd September, 1992 to the plaintiff's solicitor acknowledging receipt of the offer and seeking clarification of its terms:- "We presume that your client's offer is inclusive of the refund to the Board so that she in fact is prepared to settle for the sum of $205,000.25 clear of the refund to the Board. 11 This letter was apparently not responded to, although Mr Batch was without instructions on this point but little can be said to flow from it. In construing the terms of the offer the provisions of s.9A of the Workers' Compensation Act, 1916-90, must be borne in mind. It provides:- -- 4 of 8 -- 4 "(1) Where an injury in respect whereof a worker is entitled under subsection (1) or (2) of section nine of this Act to receive compensation from the Workers' Compensation Fund was received by the worker under circumstances creating also, independently of this Act, a legal liability in the employer to pay damages in respect of that injury (except an injury in respect whereof the employer is required by some other Act of Queensland or any other State of the Commonwealth or the Commonwealth or any other country to provide against such liability as prescribed by such other Act) (a) the amount of such damages which the employer is legally liable to pay shall, notwithstanding any other Act or law, be reduced by the total amount of the compensation (which shall include medical, hospital, travelling and other expenses) prescribed by this Act to be made from the Fund in respect of the injury in question; and (b) subject to this section, the worker or his dependants shall receive from the Workers' Compensation Fund such reduced amount. The Court by which damages are awarded in respect of an injury to which this section applies, or out of which moneys paid into Court in an action brought in respect of any such injury are ordered to be paid, shall upon the application of the Board, worker or employer determine the total amount of compensation prescribed by this Act that is to be paid from the fund in respect of such injury and that determination shall be binding upon the Board and the worker." In Tancred Brothers Pty. Ltd. v. Burke [1986] 1 Qd.R. 494 the Full Court concluded at p. 495 that a court in the circumstances set out in s. 9A gives the judgment after the reduction of damages which the employer is "legally liable to pay" by the amount of the workers' compensation. Order 26 rule 9(1) makes it plain that what the plaintiff must obtain is "a judgment no less than favourable than the offer to settle". The offer to settle sets out the way in which payment in satisfaction of the offer is to be made, namely, -- 5 of 8 -- "(a) The settlement sum acceptance; 5 (b) Costs -within 14 days within 21 days of 11 The settlement sum can only be referrable to the words "the plaintiff offers to accept the sum of TWO HUNDRED AND EIGHTY THOUSAND AND FORTY-TWO DOLLARS ($280,042.00) 11 In view of the provisions of s.9A that must mean that the plaintiff was prepared to accept $280,042.00 exclusive of the refund to the Board. Such a construction is also supported by the words "offers to accept" (my underlining). Accordingly I conclude that the plaintiff's.offer to settle the action made on 18th September, 1992 was an offer exclusive of the refund to the Workers' Compensation Board and was accordingly an offer to settle for a sum greater than that which was obtained on judgment. Accordingly there is no basis for giving effect to the costs provisions in 0.26 r.9 that the costs be on a solicitor and client basis. Mr Alldridge has further submitted that if I am against him on the interpretation of the offer to settle that I should give effect to the proviso to 0.26 r.9 in the circumstances in which the defendant declined to accept the offer to settle made by the plaintiff. It is unnecessary for me to resolve that issue in view of my construction of the offer, however it is worth making one or two observations about it. As will be seen from the reasons for judgment Dr W. Ryan, who provided reports to the defendant was led into his conclusion that the plaintiff must have had a pre-existing degenerative spine of some significant degree prior to sustaining her injury at work by the failure of Dr Stabler to describe the discs that he operated upon as -- 6 of 8 -- 6 prolapsed. Dr Stabler in his reports which were relied upon by Dr Ryan describe the discs that he saw when he performed the lumbar laminectomy as protruded. This matter was clarified in the course of Dr Stabler's evidence in the trial. Mr Alldridge submitted that it was reasonable for the defendant to rely upon Dr Ryan's opinion in those circumstances. Dr Stabler's reports were advanced as part of the plaintiff's case. I do not, however, consider that in this case, were it necessary for me to decide the matter, that that factor would cause me to decline to award the plaintiff's costs on a solicitor and client basis. Mr Alldridge also submitted that the video taken by the agents of the defendant led the defendant to conclude that the plaintiff was exaggerating her symptoms and it was only the explanation given at the trial of what was depicted on the video that it was able to be seen in its proper context. The video was taken on 26th September, 1992, that is within the 14 days allowed for the acceptance of the offer. On the basis that the defendant viewed the video prior to the expiration of the 14 days, I can consider this submission. It seems to me that it is always a risk to take a video at face value although it can often be of great assistance, but the activities depicted on the video by the plaintiff were not so grossly active as to suggest an overwhelming case for exaggeration. Mr Batch conceded that the costs of the application to reconsider the question of costs should be the defendant's costs and I so order. The formal orders then are that the costs ordered by me on 19th July, 1993 remain and further order that -- 7 of 8 -- 7 the plaintiff pay the defendant's costs of and incidental to the appearance on the 20th and today, 21st July, 1993 to be taxed. -- 8 of 8 --