FEDERAL COURT OF AUSTRALIA

Modra v State of Victoria [2012] FCA 240

THE COURT ORDERS THAT:

1.    Mr Gabriel Kuek of Access Law pay personally the costs the applicant was ordered to pay in paras 2 and 6 of the order made on 9 November 2011.

2.    Mr Kuek bear his own costs of the determination of the question whether he be ordered to pay those costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1    These reasons for judgment deal with the question whether I should order that the former solicitor for the applicant pay costs that I ordered the applicant to pay to the respondent. To decide that question, it is necessary to examine the effect of provisions in ss 37M and 37N of the Federal Court of Australia Act 1976 (Cth) (“the Federal Court Act”), and to determine whether, and to what extent, those provisions have changed the way in which courts have approached in earlier authorities the question of making a legal practitioner liable for the costs of a party.

The legislation

2    The power of the Court to award costs is conferred by s 43(1) of the Federal Court Act. Section 43(2) provides that, unless any other act imposes some limit, the power to award costs is a discretionary one. Section 43(3)(f) confers a specific power to “order a party’s lawyer to bear costs personally”.

3    Sections 37M and 37N were introduced into the Federal Court Act by the Access to Justice (Civil Litigation Reforms) Amendment Act 2009 (Cth), and came into operation on 1 January 2010. Section 37M provides:

(1)    The overarching purpose of the civil practice and procedure provisions is to facilitate the just resolution of disputes:

(a)    according to law; and

(b)    as quickly, inexpensively and efficiently as possible.

(2)    Without limiting the generality of subsection (1), the overarching purpose includes the following objectives:

(a)    the just determination of all proceedings before the Court;

(b)    the efficient use of the judicial and administrative resources available for the purposes of the Court;

(c)    the efficient disposal of the Court’s overall caseload;

(d)    the disposal of all proceedings in a timely manner;

(e)    the resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute.

(3)    The civil practice and procedure provisions must be interpreted and applied, and any power conferred or duty imposed by them (including the power to make Rules of Court) must be exercised or carried out, in the way that best promotes the overarching purpose.

(4)    The civil practice and procedure provisions are the following, so far as they apply in relation to civil proceedings:

(a)    the Rules of Court made under this Act;

(b)    any other provision made by or under this Act or any other Act with respect to the practice and procedure of the Court.

4    Section 37N provides, so far as relevant to this proceeding:

(1)    The parties to a civil proceeding before the Court must conduct the proceeding (including negotiations for settlement of the dispute to which the proceeding relates) in a way that is consistent with the overarching purpose.

(2)    A party’s lawyer must, in the conduct of a civil proceeding before the Court (including negotiations for settlement) on the party’s behalf:

(a)    take account of the duty imposed on the party by subsection (1); and

(b)    assist the party to comply with the duty.

…

(4)    In exercising the discretion to award costs in a civil proceeding, the Court or a Judge must take account of any failure to comply with the duty imposed by subsection (1) or (2).

(5)    If the Court or a Judge orders a lawyer to bear costs personally because of a failure to comply with the duty imposed by subsection (2), the lawyer must not recover the costs from his or her client.

5    Reference was also made to the following provisions of r 40.07 of the Federal Court Rules 2011:

(1)    A party who has reasonable cause to believe that additional costs have been incurred because of the party’s lawyer’s misconduct, may apply to the Court for an order:

…

(c)    that the lawyer pay to the party costs that the party has been ordered to pay to another party; or

(d)    that the lawyer indemnify any other party against any costs payable by that party.

(2)    For this rule, a lawyer has engaged in misconduct if:

(a)    a proceeding or an application is delayed, adjourned or abandoned because of the lawyer’s failure:

(i)    to attend or make arrangements for a proper representative to     attend a hearing; or

(ii)    to file a relevant document; or

(iii)    to provide the Court or another party with a relevant document; or

(iv)    to be prepared for a hearing; or

(v)    to comply with these rules or an order of the Court; or

(b)    the lawyer:

(i)    incurs costs improperly or without reasonable cause; or

(ii)    incurs costs that are unnecessary or wasteful; or

(iii)    is guilty of undue delay.

The authorities

6    In White Industries (Qld) Pty Ltd v Flower & Hart (a firm) (1998) 156 ALR 169 at 229-231, Goldberg J reviewed the authorities concerning the circumstances in which a court will order a legal practitioner to pay costs personally in the absence of any specific statutory provisions. His Honour referred to the leading English case, Myers v Elman [1940] AC 282 and to subsequent authorities, both English and Australian, in which the relevant principles have been clarified. Two salient principles emerged from his Honour’s analysis. One is that the power to order a legal practitioner to pay costs personally is compensatory, and not punitive. The other is that a serious dereliction of duty or serious misconduct on the part of the legal practitioner will be required before that order will be made. As Goldberg J pointed out, what amounts to a serious dereliction of duty will vary from case to case. Gross negligence, misconduct or a serious failure to give reasonable attention to the relevant law and facts will be sufficient to amount to a serious dereliction of duty.

7    In White Industries at 242, Goldberg J accepted the proposition that, where the question is whether a solicitor should pay costs personally, the retainer of counsel and reliance on counsel’s advice does not absolve the solicitor from responsibility or provide the solicitor with a defence to the allegations made against him or her. Retention and reliance upon counsel is a significant matter to be taken into account in determining whether there is a breach of duty on the part of the solicitor.

8    It has also been held by the House of Lords in Medcalf v Mardell [2002] UKHL 27 [2003] 1 AC 120, that a court should not make an order that a legal practitioner pay costs when the practitioner is unable to reveal his or her instructions and other relevant material because of legal professional privilege, which has not been waived, unless satisfied that there is nothing that the privileged information could show that would absolve the practitioner. See especially per Lord Bingham of Cornhill at 134-135 and Lord Hobhouse of Woodborough at 145-147. The principle was followed by Habersberger J in UTSA Pty Ltd (in liq) v Ultra Tune Pty Ltd [2004] VSC 105 at [45]-[47].

The facts

9    The applicant was born on 12 August 1988. He is alleged to have Profound Autism Spectrum Disorder, Intellectual Disability and Occipital Lobe Epilepsy. In October 2009, the applicant’s mother filed a complaint with the Human Rights and Equal Opportunity Commission (now the Australian Human Rights Commission), pursuant to the Human Rights and Equal Opportunity Commission Act 1986 (Cth) (now the Australian Human Rights Commission Act 1986 (Cth)), (“the Human Rights Act”). The complaint alleged that the State of Victoria, through its Department of Education and Early Childhood Development and its Department of Human Services had discriminated unlawfully against the applicant in contravention of various provisions of the Disability Discrimination Act 1992 (Cth) (“the Disability Discrimination Act”), in the provision of education and other services, including residential services.

10    On 6 August 2010, pursuant to s 46PH(1)(i) of the Human Rights Act a delegate of the President of the Australian Human Rights Commission terminated the complaint on the ground that she was satisfied that there was no reasonable prospect of the matter being settled by conciliation. By s 46PO of the Human Rights Act, this entitled the applicant to commence a proceeding in this Court alleging unlawful discrimination. The applicant commenced this proceeding on 1 October 2010, by his next friend, who is his mother. The application was filed by the firm Access Law, of which Mr Gabriel Kuek is designated as the principal. At the time of filing the application, no statement of claim was filed.

11    On 21 October 2010, I made orders by consent referring the proceeding to mediation by a Registrar of the Court. The mediation took place, but the proceeding was not settled. It therefore returned for directions on 10 March 2011.

12    In the course of that directions hearing, a discussion took place between Mr Gabriel Kuek, the solicitor from Access Law then acting on behalf of the applicant, senior counsel for the respondent and me as to the content of a proposed statement of claim. Senior counsel for the respondent emphasised the need for each allegation in the statement of claim to be related to the provisions of the Disability Discrimination Act. She also requested that the statement of claim identify the department or agency of the State of Victoria alleged to be responsible for each alleged instance of unlawful discrimination, an approach which is necessary, given that the applicant sues in respect of alleged unlawful discrimination in the provision of education services and other services as well. Mr Kuek gave every indication that he understood the need for the applicant’s case to be pleaded properly in this way. Nevertheless, I made a specific order, in the following terms:

1.    On or before 21 April 2011 the applicant file and serve a statement of claim setting out:

(a)    All acts, omissions and practices alleged to constitute or give rise to the unlawful discrimination the subject of the application;

(b)    The department or agency alleged to be responsible for each such act, omission or practice;

(c)    The provision or provisions of the Disability Discrimination Act 1992 (Cth) pursuant to which each act, omission or practice is alleged to constitute unlawful discrimination; and

(d)    The remedy claimed in respect of each act, omission or practice;

and containing full particulars.

13    On 27 April 2011, the first statement of claim was filed. It failed utterly to comply with the order made on 10 March 2011. It contained a catalogue of generalised complaints, accompanied by references to the numbers of sections in the Disability Discrimination Act. The elements of the definitions of discrimination in ss 5 (discrimination by less favourable treatment) and 6 (discrimination by requirement or condition) were set out. No attempt was made to plead facts that would demonstrate how each allegation was said to fit within any provision. In some cases, the definitions in ss 5 and 6 were pleaded in the alternative in relation to a particular allegation. After I had read this statement of claim, I instructed my associate to communicate with the solicitors for the respondent, to advise them that they should not file a defence to this statement of claim.

14    A further directions hearing was held on 15 June 2011. Mr Kuek again appeared for the applicant. There was a further discussion about the inadequacies of the statement of claim. I suggested to Mr Kuek that he consider engaging senior counsel with experience in the area of discrimination litigation, in order to plead the applicant’s case adequately. Mr Kuek again gave every indication that he understood the need to get the statement of claim right. I warned him that, if he failed to do so, I would consider awarding costs against him personally.

15    There was a discussion about how long I should allow for the filing of an amended statement of claim. Mr Kuek requested three months, on the basis that the counsel he proposed to use to draw the statement of claim would be overseas for some time and then engaged in a long trial.

16    On 15 June 2011, I made orders in the following terms:

1.    On or before 12 September 2011, the applicant file and serve an amended statement of claim.

2.    To the extent to which the applicant alleges discrimination as defined in s 5 of the Disability Discrimination Act 1992 (Cth) the amended statement of claim:

(a)    specify each act or omission (including any omission to make reasonable adjustments) alleged to constitute less favourable treatment of the applicant;

(b)    in respect of each such act, specify when and where each such act is alleged to have occurred and by whom each such act is alleged to have been performed;

(c)    in respect of each such omission, specify each measure or adjustment alleged to have been required to remedy the omission and state when, where and by whom each such measure or adjustment is alleged to have been required to be taken;

(d)    in respect of each such act or omission, identify the person or persons with whom the applicant alleges comparison should be made; and

(e)    set out each fact and circumstance by reference to which it is alleged that each such act or omission constituted less favourable treatment.

3.    To the extent to which the applicant alleges discrimination as defined in s 6(1) of the Disability Discrimination Act 1992 (Cth) the amended statement of claim:

(a)    specify each requirement or condition with which the respondent is alleged to have required the applicant to comply;

(b)    in respect of each such requirement or condition, specify when, where and how the applicant was required to comply;

(c)    in respect of each such requirement or condition, set out each fact and circumstance by reason of which it is alleged that the applicant did not, or was not able to, comply; and

(d)    in respect of each such requirement or condition, set out each fact or circumstance by reference to which  it is alleged that the requirement or condition had, or was likely to have, the effect of disadvantaging persons with the disability or disabilities the applicant is alleged to have.

4.    To the extent to which the applicant alleges discrimination as defined in s 6(2) of the Disability Discrimination Act 1992 (Cth) the amended statement of claim:

(a)    specify each requirement or condition with which the respondent is alleged to have required the applicant to comply;

(b)    in respect of each such requirement or condition, specify when, where and how the applicant was required to comply;

(c)    in respect of each such requirement or condition, set out each adjustment it is alleged the respondent could have made in order that the applicant complied, or would have been able to comply, and which is alleged not to have been made by the respondent; and

(d)    in respect of each such requirement or condition, set out each fact or circumstance by reference to which  it is alleged that the requirement or condition had, or was likely to have, the effect of disadvantaging persons with the disability or disabilities the applicant is alleged to have.

5.    To the extent to which the applicant alleges breach of duty or trespass, the amended statement of claim:

(a)    specify each act or omission alleged to constitute breach of duty and each act alleged to constitute trespass;

(b)    in respect of each such act, specify when and where each such act is alleged to have occurred and by whom each such act is alleged to have been performed; and

(c)    in respect of each such omission specify each act required for compliance with the duty and state when, where and by whom each such act is alleged to have been required to be performed.

6.    The amended statement of claim contain all necessary particulars.

I adjourned the directions hearing to 19 September 2011 and reserved costs.

17    By letter dated 9 September 2011 the solicitors for the respondent advised me that they had learned that Mr Kuek had engaged senior counsel to assist in the preparation of an amended statement of claim, but that the counsel in question required additional time. On this basis, the parties had consented to a two-week extension of the time for filing the amended statement of claim and an adjournment of the directions hearing. On 12 September 2011, I made orders by consent, varying paragraph 1 of the order of 15 June 2011 so as to extend the time by which the applicant was to file and serve an amended statement of claim to 26 September 2011, and adjourning the directions hearing to a date to be fixed after 3 October 2011.

18    An amended statement of claim was not filed until 17 October 2011. Although a substantial improvement on the original statement of claim, the amended statement of claim did not comply with the orders made on 15 June 2011. The most serious omission was the failure to provide particulars. Attached to the amended statement of claim were two documents marked as annexures “A” and “B” respectively. They consist of lists of dates and summaries of incidents involving the applicant over two overlapping periods between 17 February 2003 and 16 October 2009. Paragraph 73 of the amended statement of claim contains an allegation that, in 2003 and 2004, the Department of Education & Early Childhood Development on numerous occasions subjected the applicant to physical force causing him injury. The particulars to this allegation are “The Applicant refers to DEECD’s incident reports set out in Annexure A hereto.” The summaries in Annexure A appear to be mostly of incidents in which the respondent’s staff restrained the applicant on the ground for some minutes, after he had acted violently towards staff members, or had attempted to escape from where he was supposed to be. Three of those incidents are said to have occurred in 2005. In respect of one incident on 12 August 2003, the summary includes the report “Restraint not used.” One summary dated 20 August 2003 indicates that the applicant scaled a courtyard fence, tried to hit a staff member with a stick, threw the stick at another and kept running. Staff talked him into returning to the courtyard for lunch. There is no indication that any violence was used. In essence, the matters found in Annexure A are not particulars. If anything, some of the incident reports may be evidence, by way of admissions made on behalf of the respondent.

19    There are references to Annexure B in the particulars to paras 86 and 91. These paragraphs relate to allegations about what occurred during two separate periods at two separate places of accommodation. In the case of the period from late February 2004 until July 2005, at a place called Greenock it is alleged that the applicant was confined to certain parts of the house and denied access to the backyard and other parts of the house, including the bathroom, toilet and kitchen; was denied access to his possessions and toys or equipment; and was regularly subjected to physical violence, causing him injuries. The second period, from July 2005 until 28 February 2010 is said to relate to accommodation at The Crescent. Again, it is alleged that the applicant was confined to part of the house, separated from other residents; prevented from going into the backyard; given food on a tray passed through a locked door; denied furniture, toys and equipment except the television behind a perspex screen; and regularly subjected to physical violence, causing him injuries. It is necessary for the reader to go to the summaries in Annexure B (which cover only the period between 1 March 2004 and 16 October 2009) and attempt to determine which of them are said to relate to the various allegations they purport to particularise. In some cases, it is impossible to do so. For instance, in relation to 4 June 2004 it is reported that the applicant smashed his fist into a toilet bowl, opening an existing cut to his left hand. There are several records of occasions on which the applicant is said to have been hitting himself, making threats to people and banging his head on windows. Again, this is not particulars. To the extent to which it relates to allegations against the respondent, it is, if anything, evidence.

20    Finally, there are numerous paragraphs alleging that the applicant has suffered loss and damage. In each case, the particulars refer to physical injuries, psychological injury, pain and suffering and medical expenses, and state that full particulars will be provided before trial. Even if it would be necessary to update particulars prior to the trial, the complete failure to provide any indication of any loss or damage related to any particular allegations against the respondent is a serious omission.

21    The respondent’s solicitors wrote to Mr Kuek in a letter dated 2 November 2011, sent by email. In the course of that letter, they made the following statements about the amended statement of claim (abbreviated in the letter to “ASOC”):

3.    General comments about ASOC

3.1    We are currently considering our position in relation to the ASOC and have not yet made any final decisions about our response, including whether to apply to strike out parts of the pleading. We are particularly concerned that the following four deficiencies in the ASOC mean that any trial of the allegations contained in the ASOC will not be inexpensive or efficient.

3.2    First, the allegations in paragraphs 37, 50, 51, 81, 82, 88, 92, 93, 94, 95, 96(e), 98, 99, 100 and 104 are new allegations that do not arise from the Human Rights and Equal Opportunity Commission (HREOC) (now Australian Human Rights Commission) complaint. The Federal Court does not have jurisdiction to hear and determine these allegations (Australian Human Rights Commission Act 1986 (Cth), s 46PO(3), as applied in Robinson v NSW Police Force [2011] FCA 1081). Please confirm those paragraphs will be deleted from the ASOC.

3.3    Secondly, the HREOC complaint is dated 22 December 2009 and it is impermissible for the applicant to make allegations about events that occurred after that date (Charles v Fuji Xerox Australia Pty Ltd [2000] FCA 1531; Crvenkovic v La Trobe University [2009] FCA 374). Please confirm that all references to events that occurred after 22 December 2009, such as in paragraphs 90 and 94, will be deleted from the ASOC.

3.4    Thirdly, the form of the pleading in paragraphs 73, 86 and 91, which operate by reference to Annexures A and B, is wholly deficient and incapable of meaningfully being pleaded to by the respondent. It is not at all clear how it can sensibly be said that Luke was required to comply with a condition or requirement that he be subjected to “the regular application of physical force” (paragraph 74) or to “assault, injury or abuse” (paragraph 96). It is even less clear how it can sensibly be said that the “conditions” alleged in paragraph 104 caused Luke to be treated in the way alleged in Annexure B. We also note that the Annexures have been prepared without regard to reg 22 of the Education Regulations 2000 and section 44 of the Intellectually Disabled Persons Services Act 1986 (Vic) and Part 7 of the Disability Act 2006 (Vic) (from 1 July 2007). These provisions provide clear support and statutory authority for the approach adopted by both Respondents to restrain and seclude Luke Modra on occasions when he posed a risk of harm to himself and others.

22    Access Law replied to this letter by letter dated 4 November 2011. The letter made no response to the points made in paras 3.1 - 3.4 of the respondent’s letter. All that Access Law said was:

We refer to your remark that your client is considering its position in relation to the ASOC. This case is listed for Directions Hearing on 9 November 2011.

In view of the above, our client would be agreeable to the Directions Hearing being adjourned to allow your client more time to consider its position.

23    The respondent’s solicitors replied by letter dated 7 November 2011, saying:

We do not require and will not be seeking an adjournment of the directions hearing scheduled for 9 November 2011.

We expect to receive a response from you in relation to the other matters raised in our 2 November 2011 letter and ask that you do so by no later than 12.00pm [sic] on 8 November 2011. Regardless of whether we receive a reply, we will be raising the issues traversed in our letter of 2 November 2011 at the directions hearing.

24    A directions hearing was held on 9 November 2011. Junior counsel whose name was on the amended statement of claim (along with that of senior counsel) appeared for the applicant. After I had raised with counsel for the applicant some deficiencies of the amended statement of claim, senior counsel for the respondent raised the matters in the letter of 2 November 2011. There was some discussion about a timetable for the filing and service of a further amended statement of claim, complying with the orders made on 15 June 2011, and subsequent pleadings. The discussion then moved to the questions of the costs thrown away and costs of the directions hearing of 9 November 2011. I raised the question whether pursuant to the warning I had given Mr Kuek on 15 June 2011, I should order Mr Kuek to pay those costs personally. Counsel for the applicant asked that the directions hearing be stood down to give Mr Kuek an opportunity to be heard on that question. I stood over the directions hearing until that afternoon.

25    That afternoon, counsel appeared on behalf of Mr Kuek. He sought an adjournment of the question whether Mr Kuek should pay costs. Counsel sought a lengthy adjournment, on the basis that Mr Kuek would wish to file a substantial affidavit, setting out all the steps he had taken to comply with my orders of 15 June 2011. I indicated that what troubled me was not what Mr Kuek had done but what he had not done. In particular, having ultimate responsibility for filing the amended statement of claim, he filed one that did not comply with the orders of 15 June 2011. Having had his attention drawn to a number of specific deficiencies in the amended statement of claim on 2 November 2011, Mr Kuek made no response to these specific allegations in the week before the directions hearing of 9 November 2011. When counsel for Mr Kuek began addressing matters that appeared to me possibly to be the subject of legal professional privilege, I raised that subject with him, and reminded him that the privilege was that of the applicant, and not that of Mr Kuek to waive.

26    The orders I made on 9 November 2011, so far as relevant, are as follows:

1.    On or before 7 December 2011, the applicant file and serve a further amended statement of claim, complying with paragraphs 2 – 6 of the order made on 15 June 2011.

2.    The applicant pay the costs thrown away by reason of the order in paragraph 1.

…

6.    The applicant pay the costs of today.

7.    The question whether the applicant’s solicitor be ordered to pay the costs that the applicant has been ordered to pay by paragraph 2 and paragraph 6 of this order be adjourned to 28 November 2011 at 10.15am.

8.    The applicant’s solicitor have leave to file an affidavit or affidavits on the question referred to in paragraph 7 of this order.

9.    Any affidavit filed in accordance with paragraph 8 of this order:

(a)    be filed on or before 18 November 2011; and

(b)    be served on the applicant’s next friend on or before 18 November 2011; but

(c)    not be served on the respondent.

Senior counsel for the respondent did not wish to play any role in the determination of the question whether Mr Kuek should pay costs personally, and sought leave to withdraw. I granted that leave.

27    On 28 November 2011, Mr Kuek was represented by counsel (other than counsel who appeared on 9 November 2011). The applicant’s senior and junior counsel also appeared. Counsel for the applicant indicated to me that the applicant had filed an application for leave to appeal from the orders I made on 9 November 2011. The applicant sought an adjournment of the question whether Mr Kuek should be ordered to pay costs, pending the outcome of that leave application. I adjourned the question to a date to be fixed.

28    Senior counsel for the applicant said that he took full responsibility for any deficiencies in the amended statement of claim. He also made clear that the applicant did not waive legal professional privilege, so as to enable Mr Kuek to give any evidence as to what passed between him and the applicant through the applicant’s next friend.

29    The application for leave to appeal was heard on 1 December 2011. Judgment was delivered on 2 December 2011. See Modra v State of Victoria [2011] FCA 1375. The application was dismissed. Accordingly, I fixed 12 December 2011 for the hearing of the question whether Mr Kuek should pay costs. After hearing counsel for Mr Kuek, I reserved judgment.

The nature of the solicitor’s duty

30    Although reference was made to the criteria specified in r 40.07(2) of the Federal Court Rules 2011, I did not apply those criteria. Rule 40.07(1) makes it clear that they are criteria applicable to an application by a client for an order that the client’s lawyer pay the costs ordered to be paid by the client. This is not such an application. I regard s 43 of the Federal Court Act, particularly s 43(3)(f) as the source of the power to make the order in question in this proceeding.

31    Counsel for Mr Kuek was disposed to argue that the question whether Mr Kuek should be ordered to pay costs personally should be determined by reference to the principles found in the decided cases. With one significant qualification, that submission can be accepted. The qualification is that, since 1 January 2010, the duty of a legal practitioner in a proceeding in this Court has been changed significantly. To accept the proposition that ss 37M and 37N of the Federal Court Act leave the situation as it was according to authorities decided prior to 2010 would be to attribute to Parliament the intention to achieve nothing by enacting detailed legislation. In truth, the impact of those sections on the obligations of legal practitioners practising in this Court is significant. Section 37N(2)(b) requires a legal practitioner to assist the party on whose behalf he or she acts to comply with a duty to conduct a proceeding in a way that is consistent with the overarching purpose to which s 37M refers. That overarching purpose has objectives that include efficiency, timeliness and economy, as well as justice. It may be accepted that costs can only be ordered against a legal practitioner in the event of that practitioner’s serious dereliction of duty, but it must be recognised that the content of the duty has been changed by legislation.

32    The orders made on 15 June 2011 were designed to ensure the just determination of the applicant’s proceeding. The just determination of any case will be impeded dramatically by the inclusion of complaints and allegations that are extraneous to the legislation on which a party relies. A pleading lacking in precision places upon the judge an extra burden of attempting to ascertain whether there are issues on which the party can rely lawfully. There is a risk that, without the assistance of precise pleadings, the judge will fall into error in that respect. An imprecise pleading adds to the expense of a proceeding. The opposing party will have a great deal more work to do than would normally be the case, in determining whether to gather evidence to meet all that is said in the deficient pleading. The trial is likely to be longer than if the claim were pleaded properly. Thus, a failure to plead a claim correctly will impact not only on justice, but also on timeliness, efficiency and expense.

33    Orders of the kind made on 10 March 2011 quoted in [12] above, are unusual. It is generally only necessary to order that a party file and serve a statement of claim, without specifying what that statement of claim is to include. The discussion at the directions hearing, to which I have also referred in [12] above, caused me to make those orders as a precaution. It is obvious that little or no attention was paid to them. The orders that I made on 15 June 2011, set out in [16] above, are unprecedented in my experience. They were made in an endeavour to provide a guide on which Mr Kuek and counsel for the applicant could rely to ensure that the amended statement of claim met the ordinary requirements of pleading. The result was that Mr Kuek filed an amended statement of claim that did not comply with those orders.

34    Unless the deficiencies in the amended statement of claim, which I have detailed in [18]-[21] above were remedied, there would be an impact on the just determination of the proceeding. The sorts of consequences to which I have referred in [32] above would result. The impact on efficiency and timeliness is obvious. The filing and service of a statement of claim by 7 December 2011, in accordance with para 1 of the order made on 9 November 2011, would have the result that what should have been accomplished by 21 April 2011, in accordance with para 1 of the order made on 10 March 2011, was not done until more than seven months later. The effect on efficiency and expense of the proceeding is obvious. Directions hearings have been wasted in an endeavour to ensure compliance with earlier orders. Most importantly, the applicant, a disabled person, or his mother, who is his next friend, have incurred liability for costs thrown away by reason of the non-compliance.

35    The applicant is obliged by s 37N(1) of the Federal Court Act to conduct this proceeding consistently with the overarching purpose laid down in s 37M. Mr Kuek had a duty pursuant to s 37N(2)(b) to assist the applicant to comply with that duty. That he has failed to do. Section 37N(4) requires the court to take into account any such failure to comply with the duty.

36    The failure to comply with the duty is a serious one. The discussions with Mr Kuek at the directions hearings on 10 March and 15 June 2011 were such as to make it clear to any legal practitioner that full attention to the pleading was required. The assurances given by Mr Kuek that he understood this were not borne out by the quality of the later statement of claim and the amended statement of claim. Further, when the letter from the respondent’s solicitors, dated 2 November 2011, came to Mr Kuek’s attention, his reaction to the points made in it about the amended statement of claim was one of complete indifference. His failure to address the points made, to give the respondent’s solicitors assurances that they would be remedied, and to take action to remedy them before the directions hearing of 9 November 2011 is the most serious aspect of his conduct.

The role of counsel

37    It is true that Mr Kuek did engage senior counsel to settle the amended statement of claim. It is also true that senior counsel told the Court that he took responsibility for any deficiencies in that document. This does not absolve Mr Kuek of responsibility altogether. It was he who filed the document. It was he who signed the certificate that is required by r 8.05(1)(a) and Form 17 of the Federal Court Rules 2011 (and not any longer by O 11 r 1B and Form 15B of the Federal Court Rules as Mr Kuek seems to have supposed). In view of Mr Kuek’s intimate association with the directions hearings that had been held, and his knowledge of the orders made on 15 June 2011, it was unsafe for him to assume that counsel had done everything to comply with the orders. Mr Kuek would not have had to search long and hard to ascertain that there was no such compliance. The failure to provide particulars other than by general referral to Annexure A and Annexure B, and the failure to provide any particulars of alleged loss and damage, were obvious. Mr Kuek should have drawn the attention of counsel to those failures and taken steps to remedy them before filing the document. Responsibility for the dereliction of duty remained with him.

Legal professional privilege

38    Counsel for Mr Kuek attempted to argue that I should not make an order for costs against Mr Kuek personally because of the absence of any waiver of the applicant’s legal professional privilege. I am unable to understand what it is that could have been changed if legal professional privilege had been waived. Either Mr Kuek failed to provide counsel with material on which counsel could have drawn proper particulars (and obviously he did provide Annexure A and Annexure B) or he provided such material and failed to check that counsel had not had recourse to it in drawing the amended statement of claim. Either way, responsibility lies with Mr Kuek. In relation to the absence of particulars of loss and damage, it is inconceivable that no attention has been paid to ascertaining what the consequences of the matters complained of in this proceeding for the applicant had been. It may be the case that any particulars of loss and damage would need to be supplemented before the trial. Even so, to neglect such particulars entirely in an amended statement of claim, after a mediation has been conducted, and specific directions for particulars had been given, cannot be condoned.

39    Even more importantly, communications between Mr Kuek and his client could have no bearing on Mr Kuek’s failure to act on the points raised by the letter of the respondent’s solicitors dated 2 November 2011. Responsibility for his indifference and inaction lies entirely with him.

Conclusion

40    In these circumstances, it is clear that I should exercise the discretion in relation to costs by ordering that Mr Kuek pay personally the costs ordered against the applicant in paras 2 and 6 of the order made on 9 November 2011. He should also bear his own costs of the determination of the question of his liability for costs.

Associate:

Dated:    19 March 2012