MVA: s.51C MAIA and r.361 UCPR offers and costs

Hunt v Lemura & Anor [2012] QSC 7

I refer to my earlier posting regarding the trial decision.

The matter returned in relation to costs. The judgment award was more than both the Mandatory Final (“MFO”) offer under s 51C of the Motor Accident Insurance Act 1994 and r.361 of the Uniform Civil Procedure Rules 1999 (Qld).

There was no dispute costs were payable from the date of the r.361 offer, but it was contested that they should be from the date of the MFO.

Justice Henry considered sub-section 1 of s.51C, namely:

(10) However, the court must (where relevant) have regard to the mandatory final offers in making a decision about costs(emphasis added).

His Honour noted that unlike r.361 there was not a prescriptive mechanism determinative of costs, however, because the judgment was in excess of the MFO it required consideration:

[10] Where a defendant has made a settlement offer in an amount more favourable to the plaintiff than the eventual judgment amount then such an offer will be a significant relevant consideration in the defendant’s favour and the court must have regard to it. That follows from the language of the s 51C(10), the Act’s purpose of encouraging the speedy resolution of personal injury claims[6] and the context of s 51C(10) in the statutory scheme promoting that purpose[7]. Whether such an offer is a consideration that should result in an order in the defendant’s favour will depend on the circumstances of each case, particularly the force of any contrary or countervailing considerations.

Justice Henry considered the offers made and noted that the defendants offer was closer to the judgment amount, whereas the plaintiff’s offer exceeded it by some $500,000, which was indicative of the plaintiff’s consideration of her case:

[15] The quality of the offer that makes it a material consideration in the defendants’ favour is the fact that it exceeded the amount of the eventual judgment sum. It follows that generally the more significant consideration about the amount of the offer is likely to be the fact that it exceeded the eventual judgment sum at all rather than by how much it did so. Further the reference to “offers” in s 51C(10) means that a court may consider, where relevant, the mandatory final offers made by both parties. Here, the plaintiff’s mandatory final offer of $650,000 exceeded the ultimate award by approximately half a million dollars. It was not remotely close to the mark. The excessive quantum of her offer is relevant in that it suggests she would have been unwilling to accept any amount in the vicinity of the final judgment. In this case the proximity of the defendants’ mandatory final offer to the eventual judgment sum carries no material force as a countervailing consideration.

His Honour was of the view the plaintiff at the time of the MFO was sufficiently appraised that the contest was going to concern future economic loss and that there was some risk the defence experts would be accepted:

[12] The state of affairs was not as uncertain as the plaintiff submits. It would have been obvious when the plaintiff was considering the final mandatory offer that this case would turn to a large extent on the court’s decision about which side’s line of competing expert opinion should be preferred at trial. The plaintiff would have been aware of the content of the reports of the experts, both favourable and unfavourable. She would have appreciated the real risk that a trial judge would prefer the expert opinions of the defence experts, Doctors Weidmann, Toft and Burke, and conclude that her neck and back injuries had resolved or largely resolved by the time of the 2010 examinations. In turn, there was an obvious risk that a court would infer from such a conclusion that the plaintiff would be physically able to perform full-time work[8].

[13] There will inevitably be some element of uncertainty inherent in forecasting future loss and deciding whether or not to accept a mandatory final offer. However, the plaintiff had ample material upon which to make an informed decision. Such uncertainty as existed here was unremarkable and not of such a degree as to detract in any material way from the regard that must be had to the defendants’ mandatory final offer in making a decision about costs.

Accordingly, Justice Henry ordered costs from the date of the MFO on the District Court scale have regard to the change in jurisdiction.

Brisbane Barrister – David Cormack

 

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