Branagan v Robinson & Anor [2006] ACTSC 87 (15 September 2006)

Last Updated: 13 February 2007

HEATHER BRANAGAN v REBECCA ROBINSON & ANOR

[2006] ACTSC 87 (15 SEPTEMBER 2006)

COSTS - Calderbank offer by plaintiff - offer exceeding judgment sum - offer during trial - settlement to be encouraged - exercise of discretion - no new question of principle

No. SC 692 of 2001

Judge: Master Harper

Supreme Court of the ACT

Date: 15 September 2006

IN THE SUPREME COURT OF THE )

) No. SC 692 of 2001

AUSTRALIAN CAPITAL TERRITORY )

BETWEEN: HEATHER BRANAGAN

Plaintiff

AND: REBECCA ROBINSON

First Defendant

AND: PETER WISEMAN

Second Defendant

ORDER

Judge: Master Harper

Date: 15 September 2006

Place: Canberra

THE COURT ORDERS THAT:

The defendants pay the plaintiff's costs up to and including 13 May 2004 as between party and party and thereafter as between solicitor and client.1. This assessment of damages was heard over fourteen sitting days commencing on 27 April 2004 and concluding on 7 April 2005. The plaintiff had been injured in two motor vehicle accidents. Both defendants were insured by the same authorised insurer. It was agreed that it was sufficient for the Court to arrive at a single figure for damages.

2. On 7 July 2006 I delivered reasons, and on 18 August 2006 I directed the entry of judgment for the plaintiff in the sum of $760,694.17.

3. The defendants concede that costs must follow the event, and do not oppose an order that the plaintiff's costs be paid by the defendants.

4. The plaintiff relies on a Calderbank offer which was put to the defendants in a letter of 29 April 2004. The plaintiff in that letter offered to settle for $756,500 plus costs, and gave notice that if the offer was not accepted, and the plaintiff ultimately obtained judgment for that sum or more, application would be made for an order that from the date of the letter, the defendants should pay the plaintiff's costs on an indemnity basis. The offer was expressed to remain open for fourteen days, and to be withdrawn at the end of that period. The defendants do not complain that the fourteen-day period was inadequate. In reliance on the letter, the plaintiff now seeks an order that she have her costs against the defendants as between party and party up to the date of the letter, and as between solicitor and client thereafter.

5. I have been informed of other settlement offers. On 13 April 2004, the solicitors for the defendant made a Calderbank offer of $270,000 plus costs. On 28 April 2004 the defendants offered $600,000 plus costs. On the following day, as I have said, the plaintiff's Calderbank offer was put. On 13 May 2004, the defendants put again the offer of $600,000 plus costs, this time in Calderbank terms.

6. To place the offers of settlement in context, it should be borne in mind that the hearing of the action commenced on 27 April and continued on 28 and 29 April 2004, when the further hearing was adjourned to 23 August 2004. There were no further relevant settlement negotiations after 13 May 2004.

7. By the end of the first week of the hearing on 29 April, the plaintiff was still in the witness box. Two brief witnesses had been interposed on the first day, but otherwise the plaintiff had spent three days in the box. Her examination in chief occupied most of the first two days: by the end of the third day her cross-examination was still to be completed. When the action resumed on 23 August, the plaintiff was briefly examined in chief as to the period since the previous hearing, and was cross-examined for most of the rest of that day. Much of that cross-examination related to events during the adjournment period which the plaintiff had not volunteered. Apart from one medical specialist, the evidence called in the case for the defendants related to the plaintiff's activities during that same period.

8. The defendants concede that the ultimate judgment sum exceeds the plaintiff's Calderbank offer of 29 April 2004, if only by $4,194, or about 0.5%. They argue that the offer should not be given effect to, for a number of reasons. First, they say, there was a considerable increase in the plaintiff's special damages between the date of the offer and the date of judgment. If the action had been heard and judgment given shortly after the Calderbank offer, assuming the same findings of fact, the judgment sum would have been considerably less than the offer. Secondly, they submit that the offer was so close to the ultimate judgment as not to represent a genuine compromise: see Tickell v Trifleska Pty Ltd (1990) 25 NSWLR 353. At the time it was made, they submit, it represented no compromise at all. Even at the end of the trial, if judgment had been given immediately on the same findings of fact, the judgment sum would have been well short of the offer.

9. Thirdly, the defendants submit that a question to be looked at is whether the defendants' non-acceptance of the offer was unreasonable. They refer to the judgment of Higgins J in Quirk v Bawden [1992] ACTSC 118; (1992) 111 FLR 115, in which his Honour said:

Most litigation, particularly in the area of personal injuries, admits of a range of outcomes. Which of those outcomes will, ultimately, be reflected in the final judgment is a matter upon which the parties might reasonably differ. Indemnity costs should not be used to inhibit either party from litigating an issue reasonably in contention between them. However, neither should parties be permitted to persist in an unrealistic assessment on the chance that the issue or issues in dispute will be determined favourably to them when that view is able to be perceived as unrealistic.

10. Counsel for the defendants submits that a significant issue in the case was the credibility of the plaintiff, and that her credibility was severely undermined by cross-examination and other evidence. I found some of her evidence to be selective and untruthful. I was satisfied that there had been a considerable degree of conscious exaggeration and embellishment motivated by a desire to maximise her damages and perhaps also to justify her role as an invalid.

11. I am not sure that the defendants are assisted by my findings as to the plaintiff's credibility. Whilst the defendants had a measure of success on that question, and were able to contain the plaintiff's damages at a level well below an award consistent with the statement of particulars and the closing address of counsel for the plaintiff, the defendants did not succeed in confining the damages to an amount below the plaintiff's Calderbank offer.

12. I note that the certificate of readiness signed by the solicitors for the parties and filed on 5 September 2003 included an estimate on behalf of the plaintiff of the length of the trial at two days and on behalf of the defendants at one day. The hearing date was fixed at a listing hearing before the Deputy Registrar on 6 November 2003, at which time the estimate was revised, apparently by consent, to three days. It is significant that the Calderbank offer in question was made on the third day of the hearing, and rejected after those three days of hearing and well before the resumption. In the event, as I have said, the hearing continued for a further eleven days. The bulk of that time was occupied by cross-examination of the plaintiff's witnesses and by the evidence of the defendants' witnesses. It seems to me that after the rejection of the Calderbank offer, the length of the further hearing of the action was largely out of the hands of the plaintiff and in the hands of those representing the defendants. It need hardly be said that the costs on both sides of those further eleven days of hearing were very substantial: senior and junior counsel appeared throughout on both sides of the record.

13. I also take account of the fact that, after the Calderbank offer of 13 May 2004 on behalf of the defendants at $600,000 plus costs, the defendants made no further offers. They did not increase that offer at any time to reflect any increase by reason of the passage of time in the plaintiff's past loss of earnings and past treatment expenses.

14. I am not satisfied in any event that a judgment in April 2004 or in April 2005 would have been any less than the amount ultimately awarded. On the same findings of fact, one would expect that a judgment at an earlier time would have allowed lesser sums for past earning loss and treatment expenses but commensurately greater amounts for the future.

15. It seems to me on reflection that in their letter of 29 April 2004, the solicitors for the plaintiff offered to settle their client's claim at a realistic figure. With the benefit of hindsight, if that offer had been accepted, the plaintiff would have achieved roughly the same result as she achieved by continuing with the trial, and a small fortune would have been saved in legal costs on both sides. I am not swayed by the argument of the defendants that the amount of the offer was not a genuine compromise. It was, admittedly, only a little less than the plaintiff ultimately recovered, but it was very considerably less than her claim by reference to the statement of particulars. It does not seem to me that the same considerations apply to a claim for damages at large for personal injury as might apply to a commercial claim for a liquidated amount, where it has been held that an effective Calderbank offer by a plaintiff must contain an element of compromise.

16. For those reasons, it appears to me that for the Court not to give effect to the Calderbank offer would amount to a failure to recognise and encourage settlement of actions in the manner explained by Higgins J, as his Honour then was, in Quirk v Bawden, quoted above.

17. The effective date is the date when the Calderbank offer lapsed, that is 13 May 2004. The defendants are to pay the plaintiff's costs up to and including that date as between party and party, and thereafter as between solicitor and client.

I certify that the preceding two hundred and seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Master.

Associate:

Date: 15 September 2006

Counsel for the plaintiff: Mr I D Bradfield

Solicitors for the plaintiff: Porters

Counsel for the defendants: Mr D M Wilson

Solicitors for the defendants: Phillips Fox

Date of hearing: 18 August 2006

Date of judgment: 15 September 2006