Moin v Sicika and O'Malley v McEvoy

• Jurisdiction: Ireland
• Judge: MR. JUSTICE MICHAEL PEART
• Judgment Date: 24 July 2018
• Neutral Citation: [2018] IECA 240
• Date: 24 July 2018
• Court: Court of Appeal (Ireland)
• Docket Number: Neutral Citation Number: [2018] IECA 240 Record No: 2017/429

BETWEEN:

JIBRAN MOIN

PLAINTIFF/RESPONDENT

- AND -

VERONICA SICIKA

DEFENDANT/APPELLANT

BETWEEN:

JOHN O'MALLEY

PLAINTIFF/RESPONDENT

- AND -

DAVID McEVOY

DEFENDANT/APPELLANT

[2018] IECA 240

Peart J.

Peart J.

Hogan J.

Baker J.

Neutral Citation Number: [2018] IECA 240

Record No.: 2017/498

Record No: 2017/429

THE COURT OF APPEAL

Costs – Courts Act 1981 – Differential costs order – Appellants seeking costs orders under s. 17(5) of the Courts Act 1981 – Whether the trial judges fell into error in not making costs orders under s. 17(5) of the Courts Act 1981

Facts: The plaintiff/respondents, Mr Moin and Mr O’Malley, received an award of damages for personal injuries in the High Court that was within the jurisdiction of the Circuit Court, and was on a full liability basis with no deduction for contributory negligence. At the conclusion of each trial the trial judge awarded costs of the proceedings to the plaintiff on the Circuit Court scale, and gave a certificate for senior counsel. The defendants/appellants, Ms Sicika and Mr McEvoy, appealed to the Court of Appeal against those orders for costs, submitting that in each case the respective trial judges fell into error in not making a costs order under s. 17(5) of the Courts Act 1981 despite each being requested to do so after the awards of damages were made.

Held by Peart J that, in each case, there had been a clear error in principle by the respective trial judges by not having had proper regard to relevant considerations. In those circumstances, Peart J held that the Court may appropriately exercise its own discretion. Peart J considered that the circumstances of the cases clearly indicated that an order should be made in each case under s. 17(5) of the 1981 Act. Peart J held that the awards of damages were so far within the level of the Circuit Court jurisdiction that there was no question of these cases being border-line.

Peart J held that it was appropriate that the appeals should be allowed, and that a differential costs order should be made by the Court in the terms of s. 17(5)(a) of the 1981 Act. Specifically, Peart J would make an order in each case that the plaintiff do pay to the defendant the amount equal to the difference between (a) the amount of the costs as between party and party incurred in the proceedings in the High Court by the defendant as taxed by a Taxing Master of the High Court and (b) the amount of the costs as between party and party incurred in the proceedings by the defendant as taxed by a Taxing Master of the High Court if the proceedings had been heard and determined in the Circuit Court, such taxations of costs to take place in default of any agreement between the parties. Peart J would also, in each case, as provided for in s. 17(5)(b) of the 1981 Act, set off those said costs to which the defendant was entitled to be paid by the plaintiff, against the plaintiff’s costs in each case which were awarded on the Circuit Court scale with certificate for senior counsel.

Appeal allowed.

JUDGMENT OF MR. JUSTICE MICHAEL PEART DELIVERED ON THE 24TH DAY OF JULY 2018

1 Each of the plaintiff/respondents received an award of damages for personal injuries in the High Court that was well within the jurisdiction of the Circuit Court, and was on a full liability basis with no deduction for contributory negligence. At the conclusion of each trial the trial judge awarded costs of the proceedings to the plaintiff on the Circuit Court scale, and gave a certificate for Senior Counsel.

2 It is against those orders for costs that the defendant/appellant in each case appeals. As the issue that arises for determination on these appeals is identical, it is convenient that the appeals were heard together, and that a single judgment be delivered.

3 The issue arises from the provisions of s. 17(5) of the Courts Act, 1981 (as amended by substitution by s. 14 of the Courts Act, 1991) and which provides:

‘(5)(a) Where an order is made by a court in favour of the plaintiff or applicant in any proceedings (not being an appeal) and the court is not the lowest court having jurisdiction to make an order granting the relief the subject of the order, the judge concerned may, if in all the circumstances he thinks it appropriate to do so, make an order for the payment to the defendant or respondent in the proceedings by the plaintiff or applicant of an amount not exceeding whichever of the following the judge considers appropriate:

(i) the amount, measured by the judge, of the additional costs as between party and party incurred in the proceedings by the defendant or respondent by reason of the fact that the proceedings were not commenced and determined in the said lowest court, or

(ii) an amount equal to the difference between:

(I) the amount of the costs as between party and party incurred in the proceedings by the defendant or respondent as taxed by a Taxing Master of the High Court or, if the proceedings were heard and determined in the Circuit Court, the appropriate county registrar, and

(II) the amount of the costs as between party and party incurred in the proceedings by the defendant or respondent as taxed by a Taxing Master of the High Court or, if the proceedings were heard and determined in the Circuit Court, the appropriate county registrar on a scale that he considers would have been appropriate if the proceedings had been heard and determined in the said lowest court.

(b) A person who has been awarded costs under paragraph (a) of this subsection may, without prejudice to his right to recover the costs from the person against whom they were awarded, set off the whole or part thereof against any costs in the proceedings concerned awarded to the latter person against the first-mentioned person.’

4 The meaning of these provisions is clear. It gives two options to a trial judge who has awarded damages to a plaintiff which are within the jurisdiction of a court lower than that in which the case has been commenced and determined.

5 Under option (a) the trial judge may simply measure a sum which he/she considers to be the difference between the costs actually incurred and those that would have been incurred had the proceedings been commenced and determined in the appropriate court, and direct that the plaintiff pay that sum to the defendant. It is a matter for the trial judge to decide if he/she is in a position to measure that difference in any particular case. Clearly option (a) has an attractive simplicity if it possible to fairly make such a measurement, and it avoids the need for, and addition costs involved in, a taxation of the costs by the Taxing Master which is required under option (b). But as this Court made clear in Landers v. Dixon [2015] IECA 155, [2015] 1 I.R. 707, 714 ‘the judge must have some evidential or other objectively defensible basis for the manner in which costs are measured.’ As Hogan J. indicated, there may nonetheless be simple and straightforward cases where a judge ‘will have personal knowledge of the sums likely to be allowed in straightforward cases of the type presently before him or her.’ Neither of the two cases presently before this Court would appear to fall into this category.

6 Under option (b) the trial judge does not make any measurement of the difference above. Instead that task is given to the Taxing Master who is tasked with taxing costs on two bases. Firstly he/she taxes the costs actually incurred in the High Court proceedings in which the award was made, and also taxes the costs on a hypothetical basis that the proceedings had been commenced in the Circuit Court, in order to determine on a taxed basis the difference between the two amounts to which the defendant will be entitled to payment.

7 Whether the exercise is carried out under option (a) or option (b), a set-off is provided for in s. 17(5)(b) as set out above.

8 The appellants submit that in each case the respective trial judges fell into error in not making a costs order under s. 17(5) of the Act of 1981 despite each being requested to do so after the awards of damages were made. In the first proceedings ( Moin v. Sicika) the plaintiff had been a passenger in a car and sustained soft tissue injuries when there was a collision. The total damages awarded including special damages were in the sum of €41,305. The jurisdiction of the Circuit Court in respect of a personal injuries action at the relevant date was €60,000. Counsel for the defendant requested that the trial judge would exercise her discretion under s. 17(5) of the Act of 1981 by making an order under what I have referred to as option (b) - and what has been referred to on this appeal as a differential order. When making that request counsel drew attention to the fact that some eleven months previously by letter dated the 21st November 2016 the defendant's solicitor had written to the plaintiff's solicitor in which, apart from enclosing notice for particulars, stated the following:

‘In addition to the above, you might also note that we intend to seek a costs differential order at the conclusion of these proceedings on the basis of having to defend this case in the incorrect High Court jurisdiction.’

9 The trial judge inquired if she was required to make an order under s. 17(5) in the circumstances, and she was correctly assured that the section provided a discretion to make such an order where the award of damages was within the jurisdiction of the Circuit Court. Having heard brief submissions from counsel for the parties, the trial judge stated that the plaintiff had come across as a decent and honest person, and that he was genuine. She went on:

‘The other significant factor in this case, I think, is that whether you like it or not, especially with a back injury, his solicitor would have been negligent, in my view, in starting in the circuit court. Why? How on earth can a solicitor take the risk of saying to...