Churchill v The University of Sydney (No 2)

1. [1]

   HER HONOUR: On 25 September 2020 the Court heard and dismissed a Notice of Motion filed by the plaintiff in which leave was sought to file a further amended statement of claim: Richard Churchill v The University of Sydney [2020] NSWSC 1343 (“Churchill No 1”). At the completion of the proceedings the parties were directed to file short written submissions in relation to costs.

2. [2]

   These orders were made to allow the self-represented plaintiff time to seek legal advice as to a costs order, and make informed submissions as to costs, if desired.

3. [3]

   The defendant filed written submissions on 9 October 2020, within the specified timetable. The defendant submitted that costs should be awarded in the defendant’s favour; and, as per rule 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”), that costs should follow the event, there being no reason to depart from the ordinary procedure. The defendant also sought orders for indemnity costs from 8 April 2020, and ultimately submitted that a gross sum costs order in a specified amount be made.

4. [4]

   In support of its application for a special costs order, the defendant relied upon an affidavit from James Berg, solicitor, sworn 9 October 2020. Annexed to Mr Berg’s affidavit was correspondence sent by the defendant’s lawyers to Mr Churchill during the currency of the proceedings, seeking to settle the matter: a “Deed of Settlement and Release” dated 11 March 2020; an unsigned consent judgment; and tax invoices of Counsel’s fees. The consent judgment stipulated that no order as to costs would be made, and that the order of the Court would be judgment for the defendant in relation to the Plaintiff’s claim. This offer expired on 8 April 2020.

5. [5]

   The defendant pointed out that an offer of compromise was made on 11 March 2020, which had been open for acceptance up to 4pm on 8 April 2020, in accordance with Calderbank principles: Calderbank v Calderbank [1975] All ER 333. A settlement sum of $4000 was offered to the plaintiff in the form of a Deed of Release. There would otherwise be no order as to costs under the proposed settlement.

6. [6]

   The defendant referred to the six factors outlined in Miwa v Siantan Properties (No 2) [2011] NSWCA 344 at [12], in submitting that it was “unreasonable” of the plaintiff not to have accepted the offer. These factors included that the offer was made at a relatively early stage in the proceedings in terms of pleadings, albeit after the proceedings had been on foot for over 18 months; that four weeks was allowed to consider the offer; that the offer involved “a substantial compromise” (noting the plaintiff’s likely liability to costs if he was unsuccessful in his claim); the prospects of success of the plaintiff’s claim (where it was contended that he did not have reasonable prospects); the clarity of the terms of the offer (submitted as “clear”); and that the offer “expressly foreshadowed” an application for indemnity costs.

7. [7]

   Referring to Harrison v Schipp (2002) 54 NSWLR 738; [2002] NSWCA 213 as authority, the defendant also made submissions as to an order for a gross sum costs order.

8. [8]

   The defendant submitted that its total costs, (excluding the costs of the costs application), are $68,797.86 plus GST. In assessing the costs on a ‘party/party’ basis up until 8 April 2020 and on an indemnity basis thereafter, Mr Berg estimated a range of recovery between $60,351.86 and $62,432.86. These amounts reflect a range of between 75% and 80% of the fees charged up until 8 April 2020, and between 90% and 95% of the fees charged thereafter, plus disbursements in full, as well as costs appropriate for the “defence and management of the litigation” commenced by the plaintiff.

9. [9]

   If an indemnity costs order is not made by the Court, and instead costs are assessed on a party/party basis, Mr Berg’s estimated range of recovery is between $58,392.86 and $60,473.86. Applying a discount for contingencies, the defendant seeks a gross sum order of $50,000, or such other amount as the Court may consider appropriate.

10. [10]

    By email correspondence to my Associate, the plaintiff informed the Court that he did not intend to file and serve, nor did he propose to rely upon, any submissions in relation to costs. He noted that he had spoken to Ms O’Donovan, Solicitor for the Defendant, and acknowledged that the defendant was seeking a gross sum costs order of no more than $50,000.

Consideration

1. [11]

   The Court has a broad discretionary power to order costs in a matter. Specifically, section 98 of the Civil Procedure Act 2005 (NSW) provides:

2. [12]

   Pursuant to s 98 (4)(c), the Court has express powers to make a gross sum costs order.

3. [13]

   Regulation 42.1 of the UCPR provides that:

4. [14]

   I have considered the defendant’s submissions as to costs. The plaintiff did not file any evidence or submissions in response. There is no compelling reason to depart from the usual costs orders. For this reason, I have concluded that costs should be awarded in favour of the successful party.

5. [15]

   Time and money could have been saved to all concerned if the plaintiff had accepted the offer of compromise, and indemnity costs for the reasons outlined by the defendant should be awarded. The gross sum costs order of $50,000 is appropriate, and not ungenerous, considering the circumstances of this case.

ORDER

1. [16]

   Accordingly, the order of the Court is:

   1. (1)

      Costs against the plaintiff in favour of the defendant, in a gross sum costs order.