- Unreported Judgment
SUPREME COURT OF QUEENSLAND
Palmer Leisure Coolum Pty Ltd v The Magistrates Court of Queensland & Ors  QSC 25
PALMER LEISURE COOLUM PTY LTD
THE MAGISTRATES COURT OF QUEENSLAND
CLIVE FREDERICK PALMER
10132 of 2018
13339 of 2018
Supreme Court of Queensland at Brisbane
19 February 2019
Decision on the basis of written submissions
In each proceedings, the plaintiff is to pay the costs of the second and third defendants.
COSTS – Indemnity costs – where applicants successful in an application to strike out claims and accompanying statements of claim – where applicants seek indemnity costs on the basis that the plaintiffs (the defendants to the application) failed to discontinue their proceedings before the hearing when invited to do – whether genuine offer to settle made – whether plaintiffs invited to “capitulate” and offer to settle involved no compromise
Dr C Ward SC with M Karam and E Robinson for the first plaintiff
C Palmer in person
S J Carvolth for the first defendant
T Begbie for the second and third defendants
Alexander Law for the first plaintiff
C Palmer in person
Crown Law for the first defendant
Australian Government Solicitor for the second and third defendants
On 4 December 2018 I heard an application by the second and third defendants for orders that the plaintiffs’ claims in matter numbers 10132 of 2018 and 13339 of 2018 be set aside or stayed, and that their accompanying statements of claim be struck out.
On 23 January 2019 I delivered judgment in both matters and ordered that the plaintiffs’ claims be set aside and their accompanying statements of claim be struck out.
The first defendant does not seek costs against the plaintiffs.
The second and third defendants seek their costs of the applications on an indemnity basis.
In their written submissions the second and third defendants submitted:
“ The present proceedings are misconceived, futile and an abuse of the processes of the Court. The plaintiffs were put squarely on notice of these deficiencies and on two occasions were invited to discontinue on a ‘walk away’ basis. In the circumstances costs should be granted on an indemnity basis: Di Carlo ; Flynn  – .”
Di Carlo and Flynn were among the many cases to which I was referred in which plaintiffs had sought intervention, in criminal proceedings which were on foot, by courts of review.
Costs orders were not always apparent on the face of the many decisions to which I was referred by the second and third defendants, but Di Carlo and Flynn were the only two of the decisions which mentioned costs in which indemnity costs were ordered against an unsuccessful plaintiff.
Di Carlo v Dubois & Ors  QCA 316 was an application by Mr Di Carlo for an extension of time within which to appeal two matters. The matters arose out of his claim for damages for personal injury against the respondents which was dismissed on 16 July 2003. The applicant appealed against that decision to the Court of Appeal, which dismissed his appeal on 7 May 2004. On 21 March 2005, the High Court refused the applicant special leave to appeal from the decision of the Court of Appeal.
On 27 January 2005 – after his original claim was dismissed – the applicant found CT scan images which were relevant to his claim. About a year after that (after the unsuccessful appeal and refusal of special leave to appeal), on 20 February 2006, the applicant sought an extension of time within which to file a further notice of appeal to the Court of Appeal, relying upon the CT scan images, as “fresh evidence”. This was application CA No 1388 of 2006. In it, he sought a new trial of the action for reasons which included that the fresh evidence established that the judgment was obtained by the fraudulent evidence of a witness.
On 30 August 2006, the applicant filed an application seeking relief from the obligation to disclose the CT scans to the respondent, which was dismissed on 18 October 2006. Senior Counsel, who appeared on behalf of the applicant informed the court that CA No 1388 of 2006 would be discontinued once a new action had been commenced to set aside the judgment on the grounds that it had been procured by fraud.
On 15 January 2007, the applicant filed a new action – that is a claim and statement of claim seeking to set aside the judgment of 16 July 2003, on the basis that it had been obtained by fraud. The claim and statement of claim were struck out, on the respondents’ application, on 28 March 2007. The applicant filed a notice of appeal against this decision on 28 April 2007 – one day late (CA No 3622 of 2007). He sought an extension of time within which to file that notice of appeal.
Thus the Court of Appeal had before it two applications for an extension of time within which to appeal the decision made on 16 July 2003 (dismissing the original claim) and the decision made on 28 March 2007 (striking out the new claim).
The Court observed that the relevant events occurred 14 years beforehand and that the determination of the applications for an extension of time within which to appeal depended upon the application of legal principles which reflected finality in litigation.
In their opposition to the extensions of time, the respondents contended that the applicant’s delay since he discovered the CT scan images should disqualify him from an exercise of discretion in his favour: his delay exhibited a degree of disregard for the rules or procedure and the rights of other parties.
The court proceeded on the basis that the applicant had not deliberately or recklessly flouted the rules of procedure. But he had had a trial on the merits and had unsuccessfully appealed against the decision reached at trial. The respondents’ case had been vindicated by each court.
At , the Court said:
It is of great importance in the administration of civil justice that litigation is not allowed by the courts to become an instrument of harassment and oppression. There is, objectively speaking, an undeniable element of vexation in the applicant’s insistence on attempting to maintain his appeal in relation to the original action and, at the same time, pursuing an action to have the judgment in the original action set aside. It has long been established that the pursuit of the same relief by two causes of actions in separate proceedings between the same parties is presumptively oppressive. This element of vexation is aggravated in the present case by the circumstance that, contrary to the intimation made to this Court … the applicant did not withdraw CA No 1388 of 2006 once his new action had been commenced. It therefore falls to the Court to determine which of the two proceedings, if any, should now be allowed to continue.
Ultimately, the Court refused the applications for extensions of time within which to appeal the decisions. It found the pursuit of the applications unreasonable and ordered that the applicant pay costs on an indemnity basis (at ):
“The pursuit of these applications was quite unreasonable in that, by any objective measure, they were bound to fail. It may be said that the applicant should not be held to standards of unreasonable conduct because of his psychiatric difficulties: but the respondents should not be required to meet any part of the burden of costs generated by the applicant’s unreasonable attempts to reverse the outcome of his dispute with them. The applicant should, therefore, pay the costs of the respondents in each application on the indemnity basis.”
In the matters before me, it cannot be said that the plaintiffs have vexed the defendants to the same extent as the applicant in Di Carlo vexed the respondents – that is, by bringing concurrent actions after many years.
Flynn v Suncorp-Metway Ltd  QSC 175, also relied upon by the defendants, involved concurrent proceedings in the Supreme Court and the Magistrates Court. The applicant did not succeed in obtaining a certain declaration for reasons which included that bringing the concurrent proceeding amounted to an abuse of process, and that there would be no utility in the court’s making the declaration sought, in that it would not resolve the dispute between the parties in the Magistrates Court.
The respondents’ solicitors had written to the applicant on 19 March 2009 informing him that his proposed course of action, namely proceeding by way of an originating application, was “singularly inappropriate”. The respondents’ solicitors continued:
“If you decide to take that course of action, thereby making it necessary for Suncorp to appear to seek orders and directions under r 14 of the Uniform Civil Procedure Rules 1999, Suncorp will seek an order that you pay its costs of and incidental to its doing so.”
Following through, the respondents sought costs on an indemnity basis.
As to costs, the Chief Justice said at :
“Because of the basis on which the stay is being applied, that is, that the Supreme Court proceedings amount to an abuse of process, such an order is appropriate, especially where the applicant was expressly warned in advance about the inappropriateness of the course he proposed.”
I note that the applicant appeared on his own behalf in that matter. I note further that costs are discretionary.
Each of the plaintiffs submit that I ought not to order costs on an indemnity basis in this case.
The correspondence relied upon by the defendants as putting the plaintiffs “squarely on notice” about the deficiencies of their claims were two letters dated 12 November 2018 and 20 November 2018. The first letter contains the following paragraphs:
“ We are instructed that if your clients discontinue the proceedings by close of business on Monday, 19 November 2018, the second and third defendants will bear their own costs incurred to that date.
 However should your clients proceed with the matter and should our clients be successful, we will rely on this letter to seek costs on an indemnity basis by reason of:
(a) your clients’ insistence upon proceeding in the face of clear warnings as to the deficiencies in their case (as to which see Flynn v Suncorp-Metway Ltd  QSC 175,  – ; and
(b) their unreasonable failure to accept this offer of compromise.
 We look forward to your early response.”
The second letter contained the following paragraphs:
“ We refer to paragraph 22 of our letter to you of 12 November 2018, and advise that the Commonwealth defendant will extend their offer to bear their own costs upon discontinuance of these proceedings by your clients to 10 am on Thursday, 22 November 2018.
 The Commonwealth defendants have incurred significant costs to date in relation to these misconceived proceedings. They are about to incur significant further costs in preparation for the hearing. Should your clients fail to discontinue its proceedings by the above extended date, the Commonwealth respondents will rely on this letter to seek costs on an indemnity basis.”
While it seems to me that the defendants are perhaps relying on similarities in their approach in this matter to the approach of Suncorp-Metway in Flynn rather than on their correspondence as an unreasonably refused offer to settle, it is nevertheless relevant to consider the correspondence from that perspective.
Each of the plaintiffs argue, in effect, that the offer contained in the correspondence of the second and third defendants was not an offer of compromise. They rely upon the decision of Ambrose J in Mitchell v Pacific Dawn P/L (2003) QSC 179 in which his Honour said at :
“In my view an offer to settle within the contemplation of UCPR 353, non-acceptance of which will lead to an order for indemnity costs, will not include an ‘offer’ by one party to accept the whole of the relief it seeks in its claim or application – particularly where the nature of the relief claimed is such that it will be either granted or refused unconditionally. The making of a purported offer on the terms of that recorded in paragraph 8 hereof is not designed ‘to settle’ or compromise any issue between the parties. In effect it required the complete capitulation of the defendant. It did not involve anything less than the defendant’s abandonment of a critical part of its defence. If the plaintiff’s contention be correct, the making of that ‘offer’ had the effect of making the defendant liable for indemnity costs if it failed but entitled only to standard costs if it succeeded. Even if upon its proper construction UCPR 353 would theoretically permit the award of indemnity costs on the basis of the ‘offer’ recorded in paragraph 8 hereof, in my view without something else, it would be ‘inappropriate’ to make such an award. The offer in paragraph 8 required the defendant to agree that it would not succeed in which case it would pay the plaintiff’s costs on a standard basis.”
Ambrose J’s approach has been followed in Commonwealth Bank of Australia v Dallecourt & Anor  QSC 41. In that case Carmody CJ said:
“ Offers of settlement, either informal or under the UCPR, must reflect a genuine attempt to compromise. Even where the offeror is completely successful in litigation, an offer requiring complete capitulation will not generally satisfy this requirement. However a ‘walk away’ offer may be genuine where the offer involves the sacrifice of substantial recoverable costs. In Clark v Commissioner of Taxation, for example, the costs that would have been sacrificed if the offer was accepted totalled between $123,000 and $184,000. A walk away offer made late in proceedings, for example just before trial, is more likely to be considered reasonable because both parties will be fully aware of the strengths and weaknesses of their cases.”
It was also followed in the case of In the Will of Bruce George Gillespie Deceased (No 2) (2012) QSC 369. Also, there is interstate authority to the same effect, for example, Tickell v Trifleska Pty Ltd (1991) 25 NSWLR 353 at 355, in which it was explained that a “so-called” offer by a plaintiff that amounted to a demand for the full amount claimed, or practically all of the amount claimed, would not be regarded as having any consequences in relation to costs. In Leichhardt Municipal Council v Green  NSWCA 341 it was said that an offer of compromise will only justify costs on an indemnity basis if it has a real element of compromise – but simply because a defendant proposes a resolution involving the entry of judgment in their favour with no order as to costs does not necessarily mean that the offer has no real element of compromise.
Also in Dong v Song (No 3)  ACTSC 226, McWilliam AsJ said:
“What the Court is invited to do is determine whether, in the totality of the circumstances, the offer by the plaintiff represented any element of compromise or whether it was merely, yet another, formally stated demand for payment designed simply to trigger the entitlement to payment of costs of an indemnity basis.”
Mr Palmer submitted that where the offer in large measure merely invites capitulation and where there was no evidence before the Court as to what the offerer’s costs were at the time of the offer, and where the offer was made at such an early stage of proceedings but there was no reason to think that the party making the offer had incurred significant costs by that stage, it would be inappropriate for non-acceptance of the offer to result in an indemnity costs order.
The corporate plaintiff relied specifically on Mitchell v Pacific Dawn and other authorities from New South Wales to like effect.
The corporate plaintiff submitted that the defendants’ settlement offer invited the plaintiff immediately to discontinue its claim and involved no real compromise. At paragraph 2 of its written submissions the corporate plaintiff said:
“It is true that the offer would have the effect that the parties would bear their own costs up to the date of acceptance of the offer. However the offer was made at a time when the proceeding had been on foot for less than two months. It may be expected that at that stage the costs of the second and third defendants were not substantial. They had not filed a defence (having taken the position that they were not required to do so) and did not file any submissions in their application to set aside their claim and strike out the statement of claim. Their offer did not quantify or estimate their costs incurred to that point. And further the second and third defendants have not now adduced any evidence as to their costs in the proceedings as at 12 November 2018. The Court is not in a position to assess whether the offer did, in fact, amount to a genuine compromise with ‘real give and take’.”
They continued by making the point that the issues raised by the plaintiff were significant and required judicial determination: they were complex as reflected in the length and detail of my judgment. They contend that no indemnity costs order should be made.
There was no definitive authority in Queensland about whether the court’s supervisory jurisdiction over committal proceedings extended to ordering a permanent stay of those proceedings – but there was an implicit concession by the second and third respondents that the matter ought to proceed as if the jurisdiction to stay committal proceedings was part of the Supreme Court’s supervisory role over inferior courts and tribunals.
Although I found that the plaintiffs’ proceedings were an inappropriate attempt to interfere with the criminal process and that there was nothing truly exceptional about the matters as to warrant intervention by the Court, it was not necessary for me to make a finding about the plaintiffs’ motives in bringing the proceedings.
I am not certain that any compromise was available in these proceedings and I am not certain that the authorities about genuine offers of compromise have relevance to the question of costs in this case.
The remedies sought were discretionary and occasionally, though rarely, if at all, at first instance, declarations relevant to committal proceedings have been made by courts of review. Also, there had been delay between the relevant conduct and the laying of criminal charges – but the not uncommon difficulty the plaintiffs faced was their inability to identify unfair prejudice which was incurable other than by the extreme action of staying proceedings.
The accusations made against ASIC and the CDPP by Mr Palmer were serious and, as I found, groundless. It was not possible for me to conclude whether those accusations were made in bad faith, without conviction, simply for the purposes of delaying the committal proceeding or whether Mr Palmer genuinely believed he was the victim of the conspiracy he alleged.
While the position of the second and third defendants about Mr Palmer’s motives, and by extension, the motives of the corporate plaintiff are plain, in the absence of a finding by me of bad faith or an equivalent, I am not prepared to order that costs be paid on an indemnity basis.
- Published Case Name:
Palmer Leisure Coolum Pty Ltd v The Magistrates Court of Queensland & Ors
- Shortened Case Name:
Palmer Leisure Coolum Pty Ltd v Magistrates Court of Queensland (No 2)
 QSC 25
19 Feb 2019
|Event||Citation or File||Date||Notes|
|Primary Judgment|| QSC 8||23 Jan 2019||Second and third defendants' application for the plaintiff's claim to be set aside and the statement of claim struck out granted: Ryan J.|
|Primary Judgment|| QSC 25||19 Feb 2019||Costs judgment: Ryan J.|