Beckett v State of New South Wales

1. [1]

   HIS HONOUR: Three issues remain for determination following publication of the principal judgment on 24 August 2015: see Beckett v State of New South Wales [2015] NSWSC 1017. They are as follows:

   1. (1)

      Interest.

   2. (2)

      Costs.

   3. (3)

      Outstanding evidentiary questions.

2. [2]

   These are dealt with in turn.

Ms Beckett’s submissions

1. [3]

   Ms Beckett claims interest on awards in her favour in the following categories:

   1. (1)

      Non-economic loss.

   2. (2)

      Aggravated damages.

   3. (3)

      Past economic loss.

   4. (4)

      Damage to reputation.

   5. (5)

      Legal costs.

2. [4]

   Although Ms Beckett originally claimed interest upon my award of exemplary damages, that claim was expressly abandoned by Ms Nomchong SC for Ms Beckett in the proceedings before me on 30 October 2015.

3. [5]

   The total sum claimed for interest under all of these categories is $1,781,367.

4. [6]

   Ms Beckett contends that interest up to judgment should be awarded on all heads of damages in accordance with the rate set out in Practice Note SC Gen 16. It is agreed between the parties that Ms Beckett’s causes of action accrued on 26 September 2005 when all relevant charges against her were terminated in her favour. The Civil Procedure Act 2005 has been in force at all relevant times since then. The power to award interest up to judgment arises under s 100(1) of that Act, which is in the following terms:

5. [7]

   Practice Note 16 came into force on 1 July 2010 and applies to “new and existing civil proceedings in the Court.” It governs or guides the way in which proceedings are expected to be administered: Baulderstone Hornibrook v HBO & DC and Ors [2001] NSWSC 821 at [14]; Kieran Leslie Walzel & Anor v Stephen Paul Francis [2010] NSWSC 75; (2010) 77 NSWLR 92. Practitioners and litigants “should expect” interest for a pre-judgment period to be awarded in accordance with the rate set out in paragraph 5 of the Practice Note. The Practice Note does not discriminate between or among different heads of damages. It provides certainty where interest is calculated according to predetermined rates so that the parties can take it into account in their dealings during the litigation: Heydon v NRMA Ltd (No 2) [2001] NSWCA 445; (2001) 53 NSWLR 600 at [30]; Maestrale v Aspite [2014] NSWCA 182 at [135].

6. [8]

   There must be “special circumstances” to justify a different rate from the rate prescribed by the Practice Note and they must be particular to the case: K&E George Pty Ltd v Survery [2009] NSWSC 1044 at [6]; Hogan v Trustees of the Roman Catholic Church (No 2) [2006] NSWSC 74 at [37]. Ms Beckett contended that there were no reasons why a different rate should apply in this case.

7. [9]

   By 26 September 2005 Ms Beckett had sustained all her claimed losses in full. Her reputation was lost at the time of her conviction at the latest. She submitted that there should be no discount applied to the calculation of interest upon the basis that it gradually accrued on the full amount up to the time of judgment, rather than upon damages partly referable to the period between judgment and the original date of the accrual of her causes of action. On her case her damages were all complete and crystallised by no later than 26 September 2005 from which date all calculations of interest should run. In particular this should be so inasmuch as the losses sustained by Ms Beckett were in varying degrees all sustained or incurred well in advance of the actual date when the causes of action finally accrued.

The State’s submissions

1. [10]

   The State submitted somewhat boldly that there should be no award of interest in this case. Alternatively, interest should only be awarded on selected heads of damage, namely past economic loss and legal fees.

2. [11]

   The State submitted that no interest should be awarded on aggravated damages because they are damages in the nature of vindication or hurt feelings and in that sense “are not for loss or damage which was actually felt by a plaintiff materially and physically up to the entry of judgment”. Support for that submission was drawn from Ruby v Marsh [1975] HCA 32; (1975) 132 CLR 642 per Jacobs J; Thompson v Faraonio (1979) 54 ALJR 231 and Fire and All Risks Insurance Co Ltd v Callinan [1978] HCA 31; (1978) 140 CLR 427 at 432. In the latter case, interest was said to be allowable on sums “which represent(s) compensation for those detriments the practical impact of which, in terms of economic loss actually incurred, has already, at the date of judgment, been experienced by the plaintiff”. The State contended that that could not be said of any sum awarded for aggravated damages.

3. [12]

   The State made no discrete submissions concerning the award of interest on damages in this category.

4. [13]

   I take this heading to be a reference to the award of general damages in favour of Ms Beckett with respect to her two periods of incarceration. The State submitted that “arithmetical correctness or mathematical precision had little or nothing to do with the figure determined.” The State described the damages awarded by me under this head as “a staggering sum.” The significance or relevance of that characterisation in the present context is not immediately apparent to me.

5. [14]

   The State’s submissions on the question of interest continued in the following curiously strident terms:

6. [15]

   The precise bases upon which the State sought to defend Ms Beckett’s claim for interest are not otherwise entirely easy to discern. Doing the best I can it appears that the State contends that the case mounted against it was difficult to understand, so that resolution by settlement reflecting the possibility that Ms Beckett might partly succeed was not an available course. That seems to follow as one of the State’s contentions from the following written submission:

7. [16]

   A second basis would appear to be that I awarded damages calculated in today’s values, rather than the money of the day when the causes of action arose, with the result that an award of interest would, in effect, compensate Ms Beckett twice over. The State argued as follows:

8. [17]

   The State’s submission at large was that no damages in the nature of interest are available to Ms Beckett for what it described as detention damages.

9. [18]

   The State made a formal submission that Practice Note 16 either did not or should not apply in this case. It submitted that the interest rate provided for should be discarded or ignored in favour of a rate of interest between 3.75 and 4 percent.

10. [19]

    The State also contended that the period of time over which interest ought to be calculated should be no more than half the time since the crystallisation of the causes of action on 26 September 2005. That contention was supported by the following submission:

11. [20]

    The State also contended that apart from the case of past economic loss and legal fees, interest should be awarded on no more than half the amount of damages awarded in any particular category. That contention was supported by the following submission:

12. [21]

    Finally the State argued that the award of damages for damage to reputation and for aggravated damages were de minimus and ought not in any event to be the subject of an order for interest. Alternatively, any interest to be included in the damages in respect of either of those heads of damage should be at the rate of four percent calculated upon half of the capital sum.

Consideration

1. [22]

   Practice Note 16 provides relevantly as follows:

2. [23]

   The flavour of the State’s contentions is that Ms Beckett should not be entitled to interest because the State was always prepared to consider settlement of the proceedings, and was keen to do so, but was frustrated in that respect because of the way in which Ms Beckett conducted the litigation. That allegedly included maintaining causes of action that were doomed to fail and supporting some of them with false testimony and extravagant evidence of marginal relevance. Additionally, the State maintains in effect that, because my assessment of Ms Beckett’s damages was so irrational and unreasonable, she has already received more than she should have. According to this analysis, an award of interest in addition would amount to an improper exercise of the relevant discretion.

3. [24]

   It seems to me that none of the State’s arguments is appropriately directed at the matter in issue. Mr Maconachie QC for the State has made it abundantly clear that the State proposes to appeal from my decision to the Court of Appeal. Mr Maconachie has sought a stay in that context. However, the precise areas of challenge to my decision, apart from what may be gleaned from the generally agitated tone of his submissions, have not as yet been specified.

4. [25]

   This case was, on any view of the matter, an example of hard fought litigation. There was to my observation no quarter given on almost any issue by either side. Ms Beckett’s offer of compromise, to which reference is made below in the context of the arguments about costs, was sent to the State on 30 May 2014. It was clearly not accepted by the State but more importantly it was not the subject of any correspondence from the State tending to suggest that consideration of the offer was in any way hampered by difficulties understanding or assessing Ms Beckett’s case. Although I accept that there may be more than one interpretation of the State’s treatment of the offer to settle, it is at least consistent with either a stubborn disinclination to settle on any terms at all or at the very least with a view that Ms Beckett’s proposal was unreasonable or irrational or was based upon an unrealistic assessment of her prospects of success.

5. [26]

   At a more fundamental level, however, Ms Beckett has succeeded in recovering damages and is entitled to interest up to judgment in accordance with the Practice Note unless some acceptable impediment to such a course can be identified. It seems to me that Ms Beckett is correct in asserting that all of her losses are in the past. They were consummated by no later than 26 September 2005 and Ms Beckett has been uncompensated ever since. The fact that proceedings were not initiated by her until 2008 is not relevant. Damages are also regularly awarded in the currency of the day. The State’s argument that Ms Beckett’s damages for unlawful detention are excessive because they have been awarded in 2015, and are apparently undiscounted to account for the rate at which damages would have been awarded in 2005, is meaningless, as it could be levelled against any and every award of damages no matter how large or small. It is also conspicuously without content as any so-called appropriate award of damages in 2005 terms has not been identified.

6. [27]

   There is also in my view no proper basis for reducing either the period over which, or the capital amounts in respect of which, interest should be calculated or awarded. Nor do I consider that there is any sound or principled basis for reducing the rate of interest from the rate described in the Practice Note. Whatever complaints the State may have with the result in these proceedings, none of them reliably informs the question of whether or not Ms Beckett is entitled to interest up to judgment. In the final analysis, Ms Beckett has been out of her money, and the State has had the benefit of that money, at all times since 26 September 2005. A refusal to award interest must be based upon some perceived or demonstrated unfairness or what amounts to disentitling conduct. To the extent that Ms Beckett was disbelieved on certain aspects of her case she has failed to recover any damages at all. To that extent the State has been successful, so that in respect of four of the six counts sued upon, no discretion to award interest is even triggered. It would arguably be otherwise if the State could demonstrate that Ms Beckett had received some award of damages in circumstances where her relevant conduct was relevantly questionable. That is not this case.

7. [28]

   I have been provided with a schedule of interest calculations in the amount referred to earlier. Interest is claimed by Ms Beckett in accordance with that schedule at the rate of 4 percent on all heads of damage except economic loss and legal costs, where the calculation has been performed at the rate referred to in the Practice Note. Subject to the identification of any arithmetical error in those calculations, I propose to award interest in the total sum claimed.

Ms Beckett’s submissions

1. [29]

   Ms Beckett seeks costs on an ordinary basis up to and including 30 May 2014 and on an indemnity basis thereafter. On that date Ms Beckett’s solicitor served an offer of compromise upon the State in the following terms:

2. [30]

   The State has not suggested that the offer does not, for any formal or technical reasons, operate in accordance with its terms.

3. [31]

   UCPR 42.14 applies where an offer, made by a plaintiff, is not accepted by a defendant and the plaintiff obtains a result no less favourable to the plaintiff than the offer: UCPR 42.14(1). The consequence of failing to accept the offer is set out in UCPR 42.14(2).

4. [32]

   There is said to be a strong presumption in favour of the ordinary consequence of the rule. Exceptional circumstances are generally required to justify a departure: Morgan v Johnson (1998) 44 NSWLR 578 at 581; Bennette v Cohen (No 2) [2009] NSWCA 162 at [25]. The onus is on the defendant to demonstrate, with evidence, why the court should not order that it pay the plaintiff’s costs on an indemnity basis from the beginning of the day following the day on which the offer is made: Caine v Lumley General Insurance Ltd (No 2) [2008] NSWCA 109 at [35].

5. [33]

   Ms Beckett contended that costs should follow the event, which in this case was a single verdict in her favour. She submitted that there was no basis for some other or different order framed by reference to a comparison between sub-issues upon which she failed and those upon which she succeeded.

The State’s submissions

1. [34]

   The State sought a series of alternative costs orders as follows:

   1. (1)

      Ms Beckett should be ordered to pay the costs of the State generally.

   2. (2)

      Alternatively to (1), the State be ordered to pay Ms Beckett’s costs on each of the issues upon which she succeeded but that Ms Beckett be ordered to pay the State’s costs on the four issues upon which she failed.

   3. (3)

      Alternatively to (2), the State be ordered to pay Ms Beckett’s costs on each of the issues upon which she succeeded but that in respect of the remainder of the costs of the action each party should bear her or its own costs.

2. [35]

   Despite these references to a series of specific costs results, the State ultimately submitted that Ms Beckett should receive 20 percent of her costs but should pay 80 percent of the costs of the State.

3. [36]

   Doing the best I can, I perceive that the State’s reasons for contending that I should come to one of these results were as follows:

   1. (1)

      Ms Beckett gave knowingly false evidence concerning the strip search, the ownership of the pistol, her friendship with Vernon Taylor and Bev Lyons, or acceded to evidence that she knew must have been false, such as that given by Peter Caesar.

   2. (2)

      Ms Beckett persisted with evidence that was irrelevant or unnecessary, such as the Braccamonte tendency evidence, leading to a considerable waste of time and money.

   3. (3)

      Ms Beckett failed on the majority of the counts upon which she sued.

   4. (4)

      The issues upon which Ms Beckett failed were clearly dominant and/or separable from those upon which she succeeded.

   5. (5)

      The claims upon which Ms Beckett failed occupied the great bulk of the time taken to litigate the several causes of action and issues that she advanced.

   6. (6)

      Ms Beckett’s persistence with the counts upon which she failed and with false allegations each operated to deny the State the opportunity to resolve the multiplicity of issues involved in the case otherwise than by litigation.

   7. (7)

      Ms Beckett’s persistence with false allegations was inconsistent with her duty to assist the Court: s 56(3) Civil Procedure Act 2005.

4. [37]

   In support of its position the State relied upon a series of well-known authorities. For example, my attention was drawn to what was said by Gleeson CJ in Ohn v Watson (1995) 36 NSWLR 77 at 79:

5. [38]

   In Baulderstone Hornibrook Pty Ltd v Qantas Airways Ltd [2003] FCA 325 at [4] Finkelstein J said this:

6. [39]

   Comments to a similar effect can be found in the reasons of Allsop J in Evans Deacon Pty Ltd v Siebel Furniture Ltd [2003] FCA 282 at [13]:

7. [40]

   The State emphasised s 98(1) of the Civil Procedure Act and UCPR 42.1. Section 98(1) is as follows:

8. [41]

   UCPR 42.1 is as follows:

9. [42]

   The State submitted that in the particular circumstances of this case it would be appropriate “that some other order should be made as to the whole or [some] part of the costs.” That contention was fundamentally supported by urging that I should adopt an issue by issue approach to the resolution of where the balance lay. I was in that respect referred to Bostik Australia Pty Ltd v Liddiard (No 2) [2009] NSWCA 304 at [38] in the following terms:

10. [43]

    At the risk of some repetition it is instructive to note what was said in James at [32] – [34]:

11. [44]

    The State submitted that this case ultimately involved the determination of several separable or severable issues, generally corresponding to the six counts upon which Ms Beckett sued, and that the State enjoyed conspicuous success in four of the six. It contended that success in this case could not therefore be limited to a consideration of Ms Beckett’s ultimate net entitlement to damages on the counts upon which she succeeded but that the State itself enjoyed a considerable measure of success which ought properly to inform the costs outcome.

Consideration

1. [45]

   Where there are multiple issues in a case a court will generally not attempt to differentiate between those upon which a party was successful and those upon which it failed. Unless a particular issue or group of issues is clearly dominant or separable it will ordinarily be appropriate to award the cost of proceedings to the successful party without attempting to differentiate between those issues upon which it succeeded and those upon which it failed. The court has a wide discretionary power with respect to costs, which should be liberally construed. The exercise of that discretion naturally and inevitably depends upon matters of impression and evaluation. There is no inevitably correct or incorrect decision.

2. [46]

   Ms Beckett argued that it would be “facile and wrong” to attempt to separate the issues in this case by reference to each of the several charges or counts upon which she was successful and those upon which she failed. She argued that the State by its pleadings put all matters in issue and cannot now rely upon a narrow construction of what it says was truly in issue, being the question of reasonable and probable cause with respect to each charge.

3. [47]

   Consideration of the State’s amended defence to the amended statement of claim reveals at least the followings things. Ms Beckett was required to prove that the proceedings terminated in her favour. She was also required to prove that Detective Thomas was responsible for the instigation of the investigation against her. The State also denied that Detective Thomas was instrumental in instituting or maintaining the criminal proceedings against Ms Beckett, other than to say that he was the informant with respect to the charges. Significantly, malice was denied completely. Malice was an element of all of the counts upon which Ms Beckett sued and arguably covered people and events that were common to several counts upon which Ms Beckett both succeeded and failed. Ms Beckett argued that no count or series of counts upon which she failed was clearly dominant or separable from the malice element of the tort. Ms Beckett emphasised that whatever may have been the position with respect to the absence of reasonable and probable cause, she was put to proof on each and every one of her particulars of malice, and she succeeded in doing so.

4. [48]

   It is clear that I cannot exercise a discretion to award costs against Ms Beckett as a successful party arbitrarily or capriciously: Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 at [22]. The fact that proceedings involve some aspect of public interest, as the State maintains, does not warrant a departure from the general rule that costs follow the event: Oshlack at [90].

5. [49]

   In Tomanovic v Global Mortgage Equity Corporation Pty Ltd (No 2) [2011] NSWCA 256 at [97] – [98], Campbell JA set out a list of factors that may be relevant to taking a course otherwise than as indicated as a starting position, whether or not it amounts to a presumption, by UCPR 42.1:

6. [50]

   At least one common element throughout every aspect of these proceedings is the ubiquitous presence of Detective Thomas in events giving rise to all of the counts. Ms Beckett’s claims in this case derive from a long and complicated narrative of her unfortunate dealings and involvement with him over a number of years. It seems to me to be artificial and potentially misleading to assume that it would have been possible for Ms Beckett to convey a history of the events that fuelled her success in this case without at least some, probably substantial, reference to those events that were unique to the counts upon which she failed.

7. [51]

   To a lesser extent, Adrian Newell emerged as a character with a supporting role in events that spanned more than one of the six counts. It seems to me to be inevitable or at least highly likely that significant evidence touching his involvement would have emerged even in a case limited to the counts upon which Ms Beckett succeeded.

8. [52]

   Be all that as it may, it seems to me that Ms Beckett’s case can and should quite properly and accurately be characterised as a single claim by her with respect to the consequences of approximately ten years incarceration for convictions that the Court of Criminal Appeal favourably reviewed and which the Director of Public Prosecutions chose thereafter not further to pursue. It seems to me to be equally unrealistic to suggest that Ms Beckett could have been expected with precision to anticipate the extent to which she would fail or that the State could have been expected with precision to anticipate the extent to which she would succeed. The State’s arguments in this particular case about severable or separable claims and the corresponding concept of fragmented examples of success appear to me to be the product of considerable hindsight. For my part I can say that no clear or obvious result on any single issue in particular or upon any one of the six counts sued upon in general emerged until after the case had concluded and I had commenced to write my judgment. The parties quite conveniently compartmentalised their approach to the case by reference to the several counts upon which Ms Beckett sued. It does not follow in my view that a notional win-to-loss ratio on those counts reliably informs where the burden of the costs should fall.

9. [53]

   In accordance with authority, something more is required. In that context the State has identified the seven general circumstances that it contends justify a differential costs order.

10. [54]

    Ms Beckett does not accept that she gave what the State has characterised as “knowingly false evidence.” It is however difficult to accommodate that assertion with photographic evidence of Ms Beckett and Ms Lyons together at Ms Beckett’s former home or her otherwise established connection with Mr Taylor. Her denials about those associations are rather bizarre. Resolution of these contests did not involve a great deal of evidence or occupy a great deal of the trial. Mr Caesar’s evidence could have been discarded and avoided with some savings and without forensic disadvantage, given the patent unreliability of his account.

11. [55]

    The pistol count upon which Ms Beckett failed did occupy a considerable amount of time in the trial. It should not however be overlooked that the pistol count arose out of and coincided with the very important circumstances of Ms Beckett’s original arrest on 24 August 1989. Any proper consideration of the important events of that day could not have been conveniently or appropriately truncated in the context of the proceedings as a whole.

12. [56]

    The Braccamonte evidence did not ultimately produce a successful outcome for Ms Beckett but it was nevertheless powerful material in the circumstances. It is difficult to accept that a person in Ms Beckett’s litigious position, armed with the transcript of Detective Thomas’ conversation with Ms Braccamonte, would not have thought it to be of some potential significance to her case. I do not think that she can be criticised or penalised for seeking to bring it to account in this case.

13. [57]

    I do not accept that the four counts upon which the State succeeded were relevantly dominant or separable. In every instance the evidence touching these counts threw considerable light upon Detective Thomas’ personality and disposition. I have elsewhere commented upon his dealings with and treatment of Dr Richardson and the several FACS officers. This evidence, and evidence like it, was at the very least important as context and background material. I agree with Ms Beckett’s submission that it is simplistic to assume that “success” in the proceedings is divisible by reference to the outcomes on the various counts. It will be apparent in my view that Ms Beckett’s success drew support and assistance from evidence led on the counts where she failed.

14. [58]

    I am inclined categorically to reject the proposition that Ms Beckett’s conduct has somehow deprived the State of an opportunity to resolve the proceedings other than by litigation. The State’s total disregard for the offer of compromise does not inspire me with confidence that the State was anxiously hanging out for an opportunity to settle the proceedings. On the contrary, even allowing for the fact that my view of the settlement landscape was necessarily obstructed, I never once acquired the feeling that the State was even in the slightest fashion interested in settling the proceedings upon any basis other than a complete victory for it. The alacrity with which the State sought a stay of the proceedings pending an appeal, even before my reasons for judgment had been delivered into its hands, let alone read, to some considerable extent reinforces my perception that the State was obdurately uninterested in any non-litigated outcome apart from capitulation.

15. [59]

    In the end, this was and apparently remains hard fought litigation. Ms Beckett was successful in the recovery of damages in a not inconsiderable, although in my view hardly staggering, sum. The case has been on foot now for approximately 7.5 years. None of the State’s complaints about the way in which the case has been conducted over that time comes close to demonstrating misconduct by Ms Beckett. I consider that her success in the proceedings is the relevant event for costs purposes and that the State should pay them.

16. [60]

    I am also of the view that Ms Beckett is entitled to her costs on an indemnity basis from and after 30 May 2014.

17. [61]

    The result in the proceedings was clearly no less favourable to Ms Beckett than the offer communicated by her. As I have already observed, at least as far as the evidence before me suggests, not only did the State not respond to the offer in a way that might later have shed some light upon its corporate view of things at the time, such as by listing or explaining the several reasons why it was neither practical nor possible to respond to the offer, but on the contrary the State somewhat contemptuously chose to ignore the offer completely. There is for at least that reason no contemporaneous expression of concern about the offer from the State that might helpfully have assisted me to accept its current opposition to the claim for indemnity costs. The State has not discharged the onus it carries to demonstrate why it should not be ordered to pay indemnity costs in the events that have occurred.

18. [62]

    The State correctly reminded me that I omitted in my reasons for judgment to deal with some Evidence Act 1995 s 67 notices and an argument dealing with the State’s claim for privilege relating to certain documents pursuant to s 170 of the Police Act 1990. It will be apparent that none of the evidence or documents covered by any of these things was utilised or relied upon by me in disposition of either of the counts upon which Ms Beckett succeeded. In the interests of efficiency I propose to publish these reasons forthwith and to indicate that I will furnish evidentiary rulings as requested if I am assured by either of the parties that there remains some utility in doing so.

19. [63]

    My final orders in the proceedings are therefore as follows:

    1. (1)

       Judgment for the plaintiff for $4,091,717 ($2,310,350 plus interest of $1,781,367).

    2. (2)

       Order the defendant to pay the plaintiff’s costs of and incidental to the proceedings up to and including 30 May 2014 on an ordinary basis and thereafter on an indemnity basis.