Cabato v Paltridge (No 2)[2025] QDC 82

DISTRICT COURT OF QUEENSLAND

1. Introduction

1. [1]
   This is the decision with respect to costs consequent on the judgment in Cabato v Paltridge & Anor [2025] QDC 59.
2. [2]
   In that matter, I gave judgment in favour of the plaintiff against the second defendant in the sum of $73,663.91 (‘judgment sum’). The parties were directed to provide, and did provide, written submissions on costs including reply submissions.
3. [3]
   The parties have agreed that the Mandatory Final Offers (‘MFOs’) made were $40,000.00 by the plaintiff and $15,000.00 by the second defendant. Those offers were exchanged at the compulsory conference held on 18 February 2021. Proceedings were commenced on 12 March 2021.
4. [4]
   The upper offer limit at the relevant time was $71,730.00. Therefore, the judgment sum exceeds the plaintiff’s MFO as well as the upper offer limit in the Motor Accident Insurance Act 1994 (Qld) (‘MAIA’).
5. [5]
   The outcome is that the second defendant is to pay the plaintiff’s costs of the proceeding on the standard basis assessed on the Magistrate’s Court scale excluding the costs awarded by the Order of 23 October 2024.

1. The plaintiff’s position

6. [6]
   The plaintiff seeks that the second defendant pay his costs on a standard basis up to the date on which the proceedings commenced; and on an indemnity basis on or after the date on which the proceedings commenced.
7. [7]
   The plaintiff referred to s 51C(10) of the MAIA and noted that the court is required to consider MFO’s in making a decision about costs.
8. [8]
   The plaintiff highlighted s 55F(3)(b)(ii) of the MAIA noting that an indemnity costs order for the proceeding would have been mandated if the matter had fallen at the upper offer limit or under with the costs during pre-proceeding limited to $3600.00.
9. [9]
   The plaintiff submits, relying on Pollock v Thiess Pty Ltd & Ors (No 3) [2014] QSC 121 at [39],^[1] that the starting point is indemnity costs and it is for the second defendant to show why some other order is appropriate. The plaintiff further submits that this approach is consistent with the object of the MAIA and s 55F(3)(b)(ii) of the Act.
10. [10]
    The plaintiff submits that there is nothing exceptional about further evidence being obtained after the compulsory conference and relies upon the decision of Hughes v Gordon [2007] QSC 78 at [16]. Further, the plaintiff contends that he was put to significant expense in having to prove his injuries and entitlement for damages due to the second defendant never resiling from its original position.
11. [11]
    The plaintiff submits that a party wishing to dispute the applicability of a MFO should not stand idle in light of the ability to make further offers and in the present case no further offers were made. The second defendant “doubled down on its pleaded position denying spinal and other injuries” despite their own expert diagnosing soft tissue injuries of the neck and back as early as 22 June 2020.
12. [12]
    The plaintiff submits, in the alternative, that costs should be awarded on the District Court scale as it is a case that involves some “unusual feature or complexity in the evidence or the assessment of damages” given the length of the trial; length and thoroughness of the judgment; complexity of evidentiary issues and medical issues; and the polarity of the parties’ position on many critical issues.
13. [13]
    The plaintiff concedes that the order made by Wooldridge KC DCJ on 23 October 2024 for the plaintiff to pay the second defendant’s costs thrown away by the adjournment of the trial ought be excised from any costs order.
14. [14]
    The plaintiff submits that there should not be any further exclusions to the costs order. In particular, there should not be any exclusion of the recovery of costs associated with the allegations of left sided symptoms^[2] and it should be for the whole of the proceeding (not only for the part of the proceeding post adjournment of the trial). It is submitted that the circumstances that would engage Uniform Civil Procedure Rules 1999 (Qld) (‘UCPR’) r 684 are exceptional.^[3] In the present case:

    1. the adjournment (costs of which the plaintiff must already bear) was granted to enable the plaintiff to obtain an MRI in order to investigate issues related to any possible spinal lesion. Ultimately, the plaintiff’s MRI did not alter the outcome of the trial give the Court’s findings re the left sided symptoms.  The CT scans had earlier identified a disc protrusion and reversal of lordotic curve;^[4]
    2. the plaintiff’s pleaded case did not change after the date of the adjourned trial – the plaintiff did not claim any injury pertaining to the left sided symptoms; it was the defendants’ denials that were unsuccessful; the plaintiff was wholly successful including in proving a soft tissue injury to the cervical spine;
    3. there is nothing exceptional warranting the sort of “unscrambling of the egg” contended for by the second defendant;
    4. the second defendant’s argument about what may have occurred before the adjournment is mere speculation, is arguably incorrect (but that is also speculative) and misconstrues the various scenarios that may arise under s 55F of the MAIA;
    5. the whole point of the upper costs limit is to ensure that more seriously injured claimants receive appropriate benefits and the plaintiff should receive standard costs for the pre-proceeding stage (it would be rather odd if a less injured plaintiff received costs incurred during the pre-proceeding stage yet a more seriously injured plaintiff did not).

1. The second defendant’s position

15. [15]
    The second defendant opposes the assessment of costs on an indemnity basis and seeks a costs order in these terms:

“The second defendant pay the plaintiff’s costs of the proceeding:

1. incurred after 4 June 2024;
2. on the standard basis assessed on the Magistrates Court scale;

not including any costs of or incidental to the claim of suffering left sided symptoms or costs awarded by the Order dated 23 October 2024.”

16. [16]
    After referencing the decisions of Morrison v Hudson & Anor [2006] QCA 170, Castro v Hillery (2003) 1 QD R 651 and Bulsey v State of Queensland [2016] QCA 158, the second defendant submits that the following is relevant in this case:

    1. at the date the MFO was made the medical evidence in the possession of the parties was such that the second defendant was reasonably entitled to conclude that no injury was suffered to the cervical spine and lumbar spine (or alternatively if so, nothing more than of a very minor and limited nature only, which had resolved) given the complete absence of any reporting of any such injuries/symptoms until three years after the accident;^[5] the issue of abnormal illness behaviour raised by Dr Khursandi; and to also significantly question the credit of the plaintiff in light of the available material;
    2. the award made was fundamentally based on evidence not available to the parties at the time the MFO was made, nor for 3-4 years thereafter;
    3. the basis upon which the court found that the plaintiff had suffered, in particular, an injury to the cervical spine in the accident (and which was found to be the dominant injury for assessing damages) was borne out of evidence obtained in 2024 and 2025 and lay witnesses whose evidence was first known to the second defendant at trial;^[6]
    4. it is misleading for the plaintiff to say that the CT scans had “earlier” identified a disc protrusion where “earlier” was only the last business day before the adjourned trial. The first mention of reversal of the lordotic curve was in Dr Cochrane’s report dated 2 June 2024, the day before the adjourned trial was due to commence. Nothing had changed from a radiological evidence perspective at the time the MFO was made until 31 May 2024;
    5. there must have been a “new complexion” to the claim – the plaintiff obtained seven further medico-legal reports/notes and two radiological scans/reports at about and after the adjournment of the trial on 3 June 2024 including in the three days prior to the trial commencing on 31 March 2025. This includes multiple reports from a completely new speciality of doctor namely a neurosurgeon whose initial report was dated 31 May 2024 (Friday) before the trial was originally due to commence on Monday 3 June 2024;
    6. it was reasonable in all the circumstances for the second defendant not to have accepted the MFO. Without the evidence produced by the plaintiff close to the trial he would have recovered less than $40,000.00;
    7. for the plaintiff to suggest that there was a failure by the second defendant to make another offer then assumes that the plaintiff would have accepted that offer. The second defendant’s position in continuing with the trial was justifiable in the circumstances. Further, what offers the second defendant made or did not make are not relevant to making a decision about costs.^[7]
    8. the plaintiff claimed $373,475.00 in damages and in the plaintiff’s closing submissions dated 17 April 2025 claimed damages up to $259,808.61. Those sums are far in excess of the judgment sum;
    9. section 55F of the MAIA is not applicable to the determination of costs in this matter and whether the plaintiff sees that as “curious or ironic is irrelevant”.
17. [17]
    The second defendant submits that UCPR 697(2) applies and the order as to costs must be made pursuant to the Magistrates Court scale as the award of damages was less than one-half of the monetary jurisdiction of the Magistrates Court.^[8]
18. [18]
    The second defendant submits that the case did not involve any unusual feature of complexity so as to justify commencement in the District Court and it is wrong to rely on the length of a judgment or the reasoning of the judicial officer in support of a contention that costs should be, in this case, on the District Court scale.
19. [19]
    The second defendant further relies on UCPR 684 and submits that the costs order should exclude:

    1. costs associated with the adjournment of the trial on 3 June 2024. Pursuant to an order made on 23 October 2024, the plaintiff is to pay the costs of the second defendant thrown away by virtue of the adjournment of the trial;
    2. costs associated with the allegations of the left sided symptoms (or alternatively the second defendant should be entitled to recover its costs associated with such failed allegations). It is submitted that the parties spent much time on the issue of the left sided symptoms and they were considered by the plaintiff in closing submissions separate to the neck injury;
    3. costs of the proceeding prior to the adjourned trial of 3 June 2024.
20. [20]
    Alternatively, the second defendant submits that “it would be generous to award the plaintiff 50% of his standard costs on the Magistrates Court scale (such costs not to include costs pursuant to the Order dated 23 October 2024) from after the adjourned trial”.

1. Consideration

1. Indemnity costs – section 51C(10) MAIA, UCPR 360

21. [21]
    I adopt what was stated by Freeburn J in Sutton v Hutton (No 2) [2021] QSC 268 as to section 51C(10) of the MAIA and UCPR 360:

3. “[4]
   Section 51C(10) of the Act requires that the court have regard to a mandatory final offer in making a decision about costs. One of the purposes of the Act is to encourage the speedy resolution of personal injury claims resulting from motor vehicle accidents.^[9] It is therefore appropriate for a court making a costs order in a matter which does proceed to trial to seek by the order to further that objective of encouraging speedy resolution.^[10]

3. [5]
   In Lawes v Nominal Defendant^[11] Byrne J said:

3. This [i.e. s 51C(10)] is not the right to indemnity costs created by s.55F. Nor is it equivalent to the presumptive entitlement arising from successful compliance with the Offer to Settle scheme. Rather, potentially, a mandatory final offer is, by operation of s.51C(10), a significant, though not decisive, consideration in the exercise of a discretion to award costs on an indemnity basis.^[12]

3. [12]
   Where a plaintiff ‘beats’ the MFO, or at least obtains an award no less favourable, the purposes of s 51C might well be served by ordering that the defendant pay the plaintiff’s costs on the more generous level of costs recovery.^[13] In that way defendants are encouraged to accept offers which are shown to be reasonable.”

22. [22]
    Further, as was said by Williams JA in Morrison v Hudson & Anor [2006] QCA 170:

3. “[2]
   I would, however, add one further observation. Keane JA has referred to the fact that at first instance the judge was influenced by the circumstances that “a number of the medical reports which were relied upon were obtained after the mandatory final offer was made”. When dealing with an offer to settle pursuant to the rules of court and an application for indemnity costs based on the fact that the plaintiff recovered more than the offer to settle, this Court in Castro v Hillery [2003] 1 Qd R 651 held that where there was a substantial change in the case after the offer was made, costs should not be ordered on an indemnity basis. As the court there pointed out, an offer to settle could only be evaluated in the light of the circumstances disclosed in the documents in the proceedings at the time the offer was made. I can see no reason why a similar approach should not be adopted when an application for indemnity costs is made because a plaintiff recovered more than the mandatory final offer referred to in s 51C of the Motor Accident Insurance Act 1994 (Qld).”

1. Indemnity costs should not be ordered in the present case

23. [23]
    The MFO by the plaintiff was less than the judgment sum. I take into account that the judgment sum was less than the upper offer limit by less than $2000.00 because of the 25 percent reduction due to the agreed position of the parties on contributory negligence. If s 55F of the MAIA did apply then the mandated order in the present case would have been for indemnity costs from the date on which the proceedings started and costs up to the date on which the proceedings started on a standard basis up to the declared costs limit.
24. [24]
    In my view, the second defendant’s rejection of the plaintiff’s MFO was not unreasonable given the evidence as it existed at the time the MFO was made. There were real issues raised with the legitimacy of the plaintiff’s claims given the report of Dr Khursandi and the lack of reporting of any symptoms related to the accident for years following the accident.  In addition, in relation to assessing economic loss, in the plaintiff’s Notice of Accident Claim form dated 23 December 2019, the plaintiff answered “no” in response to the question “Have you lost, or will you lose wages, salary, business or other income because of the accident?”. I refer to paragraphs [27]-[41] and [258] of my primary judgment (to the extent that they refer to matters prior to the MFO being made).
25. [25]
    Ultimately, due to the extent and nature of the issues with the plaintiff’s credibility and reliability, I did not accept the plaintiff’s evidence where it was not supported by other evidence. That other evidence was not available/known to the second defendant at the time the MFO was made.
26. [26]
    Whilst it has been said that it is not unusual that a party’s case will develop and change over time, in the present case, given the basis of my findings, the medical evidence altered substantially years after the MFO was made. Radiological evidence was obtained in mid 2024 and, following that, further expert opinion including from a neurosurgeon. It was that evidence that provided independent support for the dominant injury, namely the cervical spine injury (although, even then, I did not accept the extent and constancy of the symptoms the plaintiff reported to the experts). 
27. [27]
    In summary, the findings I made in relation to the dominant injury were dependent upon radiology and considerable additional expert evidence obtained by the plaintiff from 31 May 2024 onwards, years after the MFO was made.  As such, to my mind, there was a substantial change in the case after the MFO was made.
28. [28]
    In addition to the change in the medical evidence from when the MFO was made, the judgment sum was substantially below the $373,475.00 in damages claimed in the Statement of Claim dated 12 March 2021.
29. [29]
    For the reasons explained above, and whilst I recognise that the second defendant could have made an offer following June 2024 (although there was a true contest between the experts in relation to issues including whether the disc protrusion and loss of lordosis was caused by the accident), I do not consider it appropriate to order indemnity costs even though the judgment sum was more than the plaintiff’s MFO.

1. Standard costs to be awarded on the Magistrates Court scale

30. [30]
    UCPR 697(2) requires that the costs be assessed on the Magistrates Court scale. This is not a matter where I consider that I should “order otherwise.”
31. [31]
    The proceedings were commenced in the District Court at Southport.  In my view, it is completely clear that the proceedings should have commenced in the Magistrates Court. At the time proceedings commenced on 12 March 2021, the proceedings could not have been described in any way as having some “unusual feature or complexity”. The expert evidence was limited. I recognise that at that point liability was also in contest. Any judgment on the state of the material that existed at the time proceedings began would have been well within the jurisdiction of the Magistrates Court.
32. [32]
    Even after the change in the medical evidence in June 2024, the judgment sum was still well within the Magistrate’s Court civil monetary jurisdiction. The plaintiff contends that costs should be awarded on the District Court scale as there is some “unusual feature or complexity in the evidence or the assessment of damages.” I disagree. I have already stated above my views in relation to the proceeding when it commenced in 2021.
33. [33]
    Despite the wording of UCPR 697(1) of “when the proceeding began” I have given separate consideration as to whether, at any stage of the proceedings, particularly after the obtaining of the radiology and further expert reports post 31 May 2024, the matter could be fairly described as involving “some unusual feature or complexity in the evidence or the assessment of damages.” In my view, it could not.
34. [34]
    The matter was not legally complex. By 31 May 2024, liability was not in issue only quantum.^[14] Whilst there was legal argument at trial, including most of the first day of the trial, it was mainly limited to objections to the opinions expressed in the respective expert reports which is not uncommon. It was mostly a matter of facilitating discussion with the parties where they ultimately agreed or withdrew a number of the objections. There was otherwise no complex point of law.
35. [35]
    The matter was also not factually complex; there was no complexity in the evidence. There were competing reports from experts and there were a number of injuries in dispute as well as other heads of damage but that is not uncommon in proceedings of this type. The expert evidence that was called neither by type or number could be said to be an unusual feature or complex. 
36. [36]
    I have taken into account the feature of this case of the left sided symptoms but they, to my mind, are not such as to, either individually or collectively, result in this matter being categorised as having “an unusual feature or complexity in the evidence or assessment of damages”. There was competing evidence and some images were shown – that is hardly complex or unusual. In any event, I was ultimately not satisfied of the left sided symptoms and have given the plaintiff the benefit, despite submissions to the contrary by the second defendant, of not excluding the left sided symptoms from the costs order.
37. [37]
    The plaintiff also relies on matters including the length of the trial as supporting his position. I disagree. Whilst it was technically a six day trial, one day was set aside for closing submissions and the evidence of the plaintiff took approximately two days.
38. [38]
    The plaintiff also referred to the “length and thoroughness of the judgment”. To the extent that it is relevant, to my mind, whilst the judgment was lengthy, that was largely due to summarising the various expert reports and detailing why I did not accept the plaintiff as credible and reliable. It is not a consideration that would lead me to conclude that it was the type of matter that would not fall within the Magistrates Court jurisdiction.

1. Exclusion of order made on 23 October 2024 but no other exclusions or inclusions

39. [39]
    The parties are agreed that the order made against the plaintiff by Wooldridge DCJ KC on 23 October 2024 should be excluded from the costs order.
40. [40]
    The plaintiff contends that he should also be awarded costs for the pre-proceeding stage and refers to what would have been the position under the MAIA if the judgment sum was less or equal to the upper offer limit.  The second defendant contends that costs prior to the adjourned trial should be excluded as well as costs of, or incidental to, the claim of suffering left sided symptoms (alternatively, 50 percent of his costs on the Magistrates Court scale from after the adjourned trial should be awarded).
41. [41]
    I consider that the just and fair outcome on costs balancing all considerations is as I have awarded. I have taken into account that the plaintiff was ultimately unsuccessful at trial in relation to the left sided symptoms. Whilst the plaintiff is correct that the left sided symptoms were not claimed as a separate injury, it was a clear focus under a number of the heads of damage including the cervical spine injury and implicitly future economic loss.^[15]

1. Order

The second defendant is to pay the plaintiff’s costs of the proceeding on the standard basis assessed on the Magistrate’s Court scale not including any costs awarded by the Order of 23 October 2024.