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Prasad v Divisional Engineer Northern (No 2) [2008] FJHC 234; HBJ03.2007 (25 September 2008)

IN THE HIGH COURT OF FIJI
CIVIL JURISDICTION
AT LABASA

Judicial Review No. HBJ 03 of 2007

IN THE MATTER of an Application by RAJENDRA PRASAD
(f/n Ram Autar) of Bulileka Labasa, Accounts Officer
for Judicial Review under Order 53, Rule 3(2) of the High Court Rules 1988

AND

IN THE MATTER of the Decision purported to be made by the
DIVISIONAL ENGINEER NORTHERN and/or
MINISTRY FOR TRANSPORT, WORKS AND ENERGY
on or about 20 March 2007

BETWEEN:

RAJENDRA PRASAD
f/n Ram Autar of Bulileka Labasa
Applicant

AND

DIVISIONAL ENGINEER NORTHERN
of PWD Labasa
First Respondent

AND

MINISTRY FOR TRANSPORT, WORKS AND ENERGY
Second Respondent

Appearances:
Counsel for Applicant: Mr Kohli
Counsel for Respondents: Ms Lord

Date of Submissions: 31 July 2008 (R’cd 19 September 2008)
Date of Judgment: 25 September 2008

JUDGMENT (No. 2)

Claim for Damages; Applicant successful in judicial review; Applicant variously dismissed and suspended; Reversal of dismissal and revival of suspension; Notification of reversal and revival; Timing of notification; Relevance to award of damages; Basis for award of damages; Special damages not pleaded; General damages only; Constitution Amendment Act 1997 ss. 33(3), 38; Application for Indemnity Costs; Principles governing Indemnity Costs; Basis upon which Indemnity Costs to be awarded; Leave for judicial review heard expeditiously; Leave granted by consent; Delay in substantive proceeding; Failure to comply with Master’s Orders; Failure to comply with interim injunction; Late notification to Court of suspension vs termination; Non-receipt by Applicant of notice re suspension vs termination

Australian Competition and Consumer Commission v. Amcor Printing Papers Group Ltd [2000] FCA 163
Anuradha Charan v. Public Service Commission and Ors (Civil Appeal Judicial Review No. 2 of 1992)

Baillieu Knight Frank (NSW) Pty Ltd v. Ted Manny Real Estate Pty Ltd (1992) 30 NSWLR 359
Bakani v. Carpenters Fiji Ltd [2008] FJCA 6; AAU0038.2006 (1 April 2008)
Re Bond Corporation Holdings Ltd (1990) 1 ACSR 350; (1990) 8 ACLC 153; (1990) 1 WAR 465
Bowen Jones v. Bowen Jones [1986] 3 All ER 163
British Transport Commission v. Gourley [1955] UKHL 4; [1956] AC 185

Colgate-Palmolive Co. v. Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225
Central Manufacturing Company Ltd v. Kant [2003] FJSC 5; CBV0010.2002 (24 October 2003)
Cooperative Bulk Handling Ltd v. Australian Manufacturing Workers Union (WA Branch)(Unreported, WASC, Lib. No. 970190, 30 April 1997), per Wheeler, J.
Council of Civil Service Unions and Ors v. Minister for the Civil Service [1983] UKHL 6; (1984) 3 All ER 935
Credit Corporation (Fiji) Limited v. Wasal Khan and Mohd Nasir Khan (Civil Appeal No. ABU0040 of 2006S, High Court Civil Action No. HBC0344 of 1998, 8 July 2008).
Cretazzo v. Lombardi (1975) 13 SASR 4

Dillon and Ors v. Baltic Shipping Co. (‘The Mikhail Lermontov’) (1991) 2 Lloyds Rep 155
Diners Club (NZ) Ltd v. Narayan [1997] FJCA 46; Abu0004u.96s (28 November 1997)
Donnelly v. Edelsten [1994] FCA 992; [1994] 49 FCR 384

Elite Protective Personnel v. Salmon [2007] NSWCA 322
Fountain Selected Meats (Sales) Pty Ltd v. International Produce Merchants Ltd & Ors (1998) 81 ALR 397

Harley v. McDonald [2001] UKPC 18; [2001] 2 AC 678
Harrison v. Schipp [2001] NSWCA 13
Haywood & Anor v. Pullinger & Partners Ltd [1950] 1 All ER 581
Heffernan v. Byrne [2008] FJCA 7; ABU0027.2008 (29 May 2008)
Herning v. GWS Machinery Pty Ltd (No. 2) [2005] NSWCA 375
Huntsman Chemical Company Australia Limited v. International Cools Australia Ltd (1995) NSWLR 242

Ilkiw v. Samuels & Ors [1963] 1 All ER 879
J-Corp Pty Ltd v. Australian Builders Labourers Federation Union of Workers (WA Branch)(No. 2) [1993] FCA 70; (1993) 46 IR 301

Kemajuan Flora SDN Bh v. Public Bank BHD & Anor (High Court Malaya, Melaka, Civil Suit No. 22-81-2001, 25 January 2006)
Lee v. Mavaddat [2005] WASC 68 (25 April 2005)
Leichhardt Municipal Council v. Green [2004] NSWCA 341

MGICA (1992) Ltd v. Kenny & Good Pty Ltd (No. 2) [1996] FCA 862; (1996) 140 ALR 707
Re Malley SM; Ex parte Gardner [2001] WASCA 83;
Ma So So Josephine v. Chin Yuk Lun Francis and Chan Mee Yee (FACV No. 15 of 2003, Court of Final Appeal Hong Kong Special Administrative Region, Final Appeal No. 15 of 2003 (Civil)(On Appeal from CACV No. 382 of 2002, 16 September 2004)
Medcalf v. Weatherill and Anor [2002] UKHL 27 (27 June 2002)
Monk v. Redwing Aircraft Co Ltd [1942] 1 KB 182

Native Land Trust Board Employees Association v. Native Land Trust Board [1998] FJCA 28; Abu0028.98s (5 August 1998)
Nicole Prender v. Specialist Solutions Pty Ltd (2005) 179 No. 4 GGIG 91-92 (No. B599 of 2004, Queensland Industrial Relations Commission, 17 May 2005)

O’Reilly v. Mackman [1983] UKHL 1; [1983] 2 AC 237

Padua v Public Service Commission [1999] FJCA 17; Abu0032u.97s (26 February 1999)

Permanent Secretary for the Public Service Commission v Lagiloa [1997] FJCA 48; [1997] 43 FLR 303 ((Civil Appeal No. ABU0038 of 1996, 28 November 1997)
Permanent Secretary for Public Service Commission v. Matea [1998] FJCA 23; Abu0016u.98s (29 May 1998)
Prasad v. Divisional Engineer Northern (No. 1) [2008] FJHC 161; HBJ03.2007 (17 July 2008)
Preston v. Preston [1982] 1 All ER 41

Quancorp Pty Ltd & Anor v. MacDonald & Ors [1999] WASCA 101
Quirk v. Bawden 111 FLR 115 (Sup Ct ACT)

R. v. Barnsley Metropolitan Borough Council; Ex parte Hook (1976) 1 WLR 1052
Ranjay Shandil v. Public Service Commission (Civil Jurisdiction Judicial Review No. 004 of 1996, 16 May 1997)
Ratcliffe v. Evans [1892] UKLawRpKQB 131; [1892] 2 QB 524
Richard Shorten v. David Hurst Constructions P/l; D. Hurst Constructions v. RW Shorten [2008] AdjLR 06/17 (17 June 2008)
Ridehalgh v. Horsefield and Anor [1994] Ch 205

SDS Corporation Ltd v. Pasdonnay Pty Ltd and Anor [2004] WASC 26 (S2), 23 July 2004[1]
SMEC Testing Services Pty Ltd v. Campbelltown City Council [2000] NSWCA 323
SZABF v. Minister for Immigration (No. 2) [2003] FMCA 178
Sayed Mukhtar Shah v. Elizabeth Rice and Ors (Crim Appeal No. AAU0007 of 1997S, High Court Crim Action No. HAA002 of 1997, 12 November 1999)
Sharma v. Dominion Wire & Cables Ltd (HBC 352 of 1998)
Shore Buses Limited and Ors v. Ministry of Labour and Industrial Relations (Civil Appeal No. ARU 0055 of 1995)
The State v. The Permanent Secretary for Public Service Commission and Permanent Secretary for Education, Women and Culture; Ex parte Lepani Matea (Judicial Review Action No. HBJ0021 of 1996, 18 March 1998)
State v. The Police Service Commission; Ex parte Beniamino Naviveli (Judicial Review 29/94; CA Appeal No. 52/95, 19 August 1996)
The State v. The Public Service Commission; Ex parte Mario Magales Padua (Civil Jurisdiction Judicial Review No. 0009 of 1996, 11 June 1999)
The State v. Public Service Appeal Board; Ex parte Munsamy Reddy (Civil Jurisdiction Judicial Review No. HBJ 0040 of 1999, 17 July 2000)

Tickell v. Trifleska Pty Ltd (1990) 25 NSWLR 353
Trade Practices Commission v. Nicholas Enterprises (1979) 28 ALR 201

Willis v. Redbridge Health Authority (1960) 1 WLR 1228 (CA)
Wiseman v. Borneman (1971) AC 297

1. Background of Application for Costs & Damages

On 11 July 2008 Mr Rajendra Prasad’s application for Judicial Review under Order 53, Rule 3(2) of the High Court Rules 1988 was heard in the High Court at Labasa. On 17 July 2008 judgment was delivered in Suva and the following Declaration and Orders were made:

DECLARATION AND ORDERS

1. An Order of Certiorari is issued in respect of the decision made on or about 20 March 2007 by the Divisional Engineer Northern and/or Ministry for Transport, Works and Energy purporting to terminate the Applicant’s employment/service and the decision is quashed.
   
2. A Declaration is issued in respect of the decision made on or about 20 March 2007 by the Divisional Engineer Northern and/or Ministry for Transport, Works and Energy that they or any one of them acted in breach of the Applicant’s legitimate expectations.
   
3. In respect of the claim for damages, the Applicant to file and serve short written submissions on or before 31 July 2008, and the Respondents to file and serve any short written submissions in reply on or before 14 August 2008.
   
4. In respect of the claim for indemnity costs, the Applicant to file and serve a short schedule of costs on or before 31 July 2008, and the Respondents to file and serve any reply on or before 14 August 2008.
   
5. Liberty to apply.
   

1.1 In accordance with the Orders, on 31 July 2008 submissions were filed and served by the Applicant together with a schedule of costs. On 8 August 2008 these were transmitted by the High Court Registry at Labasa to the High Court Registry in Suva. Despite this, it was only on 19 September 2008 in Labasa that a copy of the submissions was provided to me, upon Counsel for the Applicant raising the matter before me on Thursday 18 September 2008.

1.2 No submissions were, in the event, received from the Respondent. Hence, the Court’s decision is made by reference to the schedule of costs and submissions provided by the Applicant only.

2. Claim for Damages

Rarely does it appear that damages are awarded in judicial review. Damages can, however, be awarded.

2.1 (a) Provision for Damages in Judicial Review & Applicant’s Damages Claim: Order 53, Rule 7 says:

Claim for damages (O.53, r.7)

7.- (1) On an application for judicial review the Court may, subject to paragraph

(2), award damages to the applicant if –

(a) he has included in the statement in support of his application for leave under rule 3 a claim for damages arising from any matter to which the application relates, and

(b) the Court is satisfied that, if the claim had been made in an action begun by the applicant at the time of making his application, he could have been awarded damages.

(2) Order 18, rule 12, shall apply to a statement relating to a claim for damages as it applies to a pleading.

2.2 Under Order 18, rule 12:

Admissions and denials

12.- (1) Subject to paragraph (4), any allegation of fact made by a party in his pleading is deemed to be admitted by the opposite party unless it is traversed by that party in his pleading or a joinder of issue under rule 13 operates as a denial of it.

(2) A traverse may be made either by a denial or by a statement of non-admission and either expressly or by necessary implication.

(3) Subject to paragraph (4), every allegation of fact made in a statement of claim or counterclaim which the party on whom it is served does not intend to admit must be specifically traversed by him in his defence or defence to counterclaim, as the case may be; and a general denial of such allegations, or a general statement of non-admission of them, is not a sufficient traverse of them.

(4) Any allegation that a party has suffered damage and any allegation as to the amount of damages is deemed to be traversed unless specifically admitted.

2.3 Mr Prasad, in his Application for Leave filed 27 July 2007, sought relief including:

(c) Damages

(d) Further Declarations or other relief as to this Honourable Court may deem fit

(e) Costs on indemnity basis

2.4 In his Affidavit in Support filed on the same day, Mr Prasad requests the relief ‘as appearing in the Statement filed’ pursuant to Order 53, Rule 3(2)

2.5 The Notice of Opposition, filed on 20 September 2007, does not address specifically the question of relief and in particular damages, saying simply that the Respondents seek:

1. The application be summarily dismissed at leave stage; and
   
2. With costs incidental to the proceedings.
   

2.6 The Affidavit in Reply, filed on 28 May 2008, asks that the ‘Application for Judicial Review and for stay be denied and should be dismissed with costs in favour of the Respondents’: para 15

2.7 However, in accordance with Order 18, Rule 12(4), Mr Prasad’s allegation of suffering damage and as to his claim for damages ‘is deemed to be traversed’ as there is no ‘specific admission’ by the Respondents and effectively there is a repudiation in their material before the Court.

2.8 In Written Submissions Counsel for Mr Prasad refers to both ‘general damages’ and ‘damages [being] loss of salary from the date of suspension until he is reinstated’, Mr Prasad’s being without wages from 2 February 2007 ‘vide memorandum dated 02/02/07’: Affidavit, Annexure ‘H’; Written Submissions, p. 2

2.9 (b) Damages in Judicial Review – Awards Made: Albeit rarely, in Fiji awards of damages have been made in judicial review in the following circumstances and amounts. Each relates to loss of salary/wages in circumstances of dismissal or demotion.

2.10 In The State v. The Public Service Commission; Ex parte Mario Magales Padua (Civil Jurisdiction Judicial Review No. 0009 of 1996, 11 June 1999) His Lordship Justice Fatiaki refused indemnity costs, special damages or exemplary damages, saying he was ‘satisfied that no basis exists either in law or fact to support the grant’ of any of these claims. However, he said he was ‘equally ... satisfied’ the Applicant, Dr Padua, ‘is entitled to an award of general damages’:

There can be no argument that had the applicant’s employment not been terminated, he would have continued to serve out the remainder of his contract and would have earned salary and gratuity commensurate with his position as Chief Medical Officer at the Labasa Hospital on an annual gross salary of $33,461 as at the 18th of November 1994 (Ex P. 7). The possibility that his contract would have been extended cannot be discounted either: at 12-13

2.11 Fatiaki, J. observed that Dr Padua had, since his dismissal, been unemployed, having ‘to sell off his car, some household items and [dispose] of his jewelry in order to survive and even borrowed money’. His name had been removed from the Medical Practitioners Register consequent upon his termination ‘thereby rendering him incapable of practicing his profession even in a private capacity’:

In all the circumstances and doing the best I can with the available evidence I award the applicant general damages in the sum of $30,000: at 13

2.12 Costs were fixed at $1,500 ‘together with all reasonable disbursements in relation to the hearing ... including ... travel and accommodation expenses of counsel’: at 13

2.13 In The State v. The Permanent Secretary for Public Service Commission and Permanent Secretary for Education, Women and Culture; Ex parte Lepani Matea (Judicial Review Action No. HBJ0021 of 1996, 18 March 1998), His Lordship Justice Byrne determined that, together with reinstatement, the Applicant Mr Matea should be paid all his entitlements as a Teacher (TE08) with effect from the date of his purported dismissal to his reinstatement, together with costs. Dismissal was based upon his conviction in Nausori Magistrate’s Court, just over a month before, of causing death by dangerous driving contrary to section 238 of the Penal Code (Cap 17), that offence and another (driving a motor vehicle of a class other than he was authorised to drive) having occurred on 1 April 1995. Mr Matea pleaded guilty to both charges, being convicted and sentence to nine months imprisonment suspended for two years on the first, and fined $500.00 in default four months imprisonment on the second. He was disqualified from obtaining or being in possession of a driver’s licence for eighteen months.

2.14 Leave to apply for judicial review was granted on two grounds:

• Whether the penalty imposed was too severe; or
• Whether before imposing the penalty of dismissal the Respondents should have given him an opportunity to be heard on the question of penalty.
  

2.15 That Mr Matea had been given no opportunity to be heard was not disputed, the Respondents’ case being that Regulation 54 of the Public Service Commission (Constitution) Regulations 1990, under which he was dismissed, did not make the giving of an opportunity obligatory. Byrne, J. said that his initial reaction was that ‘at least prima facie’, Mr Matea ‘had been treated too harshly ... given his length of service’ from January 1979 and His Lordship ‘... would need to receive very persuasive arguments ... as to why [Mr Matea] should not be granted Judicial Review of the decision of dismissal’: at 3

2.16 Under Regulation 54 Respondents had a discretion as to penalty in the case of a criminal offence or charge. They relied upon The State v. Attorney-General of Fiji; Ex parte Joseph Nainima (HBJ0027 of 1995, 21 October 1997) and Wiseman v. Borneman (1971) AC 297 for dismissal without a hearing on penalty. Byrne, J. distinguished the former, saying that in Ex parte Nainima he had refused judicial review on the ground that Mr Nainima ‘had been given and ... availed himself of every opportunity to present his case following his reduction in rank by the Education Department’. Mr Matea’s case was, said His Lordship, ‘altogether different’:

Time after time the Courts have said that where a person’s employment, career or reputation are at stake it is important in the administration of justice that the authority concerned with adversely affecting such employment must be careful to observe the rules of natural justice and procedural fairness towards the person so affected: at 4, citing O’Reilly v. Mackman (1983) AC 237, at 276, per Diplock, LJ and Wiseman v. Borneman, per Reid, LJ.

2.17 His Lordship granted certiorari, following R. v. Barnsley Metropolitan Borough Council; Ex parte Hook (1976) 1 WLR 1052, quashing the decision and holding Mr Matea should have been given an opportunity to be heard on penalty. This was upheld on appeal, however, the Court of Appeal in Permanent Secretary for Public Service Commission v. Matea [1998] FJCA 23; Abu0016u.98s (29 May 1998) disagreed with the relief as to reinstatement and payment of entitlements: at 9

2.18 The question of such an order was, said the Court, ‘canvassed in The Permanent Secretary for the Public Service Commission and Anor v. Epeli Lagiloa (Civil Appeal No. ABU0038 of 1996), where it was held that since the dismissal decision was quashed by certiorari, it had no effect and was null and void. It followed that Mr Matea was still employed by the Respondent and had been since the date of the purported, but ineffective, decision’: at 9

2.19 In State v. Public Service Commission; Ex parte Oveti Laladidi (Judicial Review No. 17 of 1992, 19 July 1995), Byrne J. granted mandamus directing the Respondent to re-instate the Applicant, Mr Laladidi, to his substantive former position of Assistant Commissioner of Prisons, declared Mr Laladidi’s down-grading, transfer and loss of salary directed by the Respondent was ‘unlawful and null and void’, and ordered the Respondent pay Mr Laladidi’s costs to be taxed if not agreed. Effectively, Mr Laladidi’s loss of salary was ordered to be made up by the Respondent. Again, however, this followed not as a matter of damages, but consequent upon the determination that the decision should be quashed.

2.20 Mr Laladidi had been ‘downgraded forthwith from Assistant Commissioner of Prisons to Assistant Superintendent of Prisons’, was to receive a downgraded salary, be ‘transferred to another District to be arranged by the Commissioner of Prisons’ and was issued with a final warning, where:

• Mr Laladidi joined the Public Service in the Prisons Department in 1970 as a Prison Officer Class C;
  
• Over twenty-two years he was promoted several times, on the last occasion to the position of Assistant Commissioner of Prisons, with effect from 2 January 1991;
  
• He had ‘received excellent reports on his work performance [over twenty-two years] from the Prisons Department [and] Public Service Commission which were the reasons for his promotions’;
  
• Allegations of an extra-marital affair with a female Prison Officer ‘appear to have been made first in November 1986 ... repeated in April and June 1987 when the former Commissioner of Prisons received correspondence from a person claiming to be [Mr Laladidi]’s wife and from the husband of [the Prison Officer]’;
  
• The Commissioner ‘took no action’ ‘apart from transferring [the Prison Officer] to the Female Prison’, expressly stating in a ‘letter to [her] husband that this was not in any way to be taken as reflecting any belief by the Commissioner that the allegations were true’;
  
• Then on 29 December 1989 and shortly after the Commissioner wrote to Mr Laladidi ‘very paternalistically’ on ‘Public Morality’, then on ‘Conduct’, in the first letter saying amongst other matters that Mr Laladidi had ‘not lived up to’ his office, his action ‘has also brought disrepute and shame on this Office’ and he ‘should now refrain from indulging in stealing someone else’s property – knowing very well that the officer whom you are going around with is married and has children ...’; the second letter being in His Lordship’s words another example ‘of the view held then and even up to the present time by the Commissioner that he had a right to meddle in [Mr Laladidi’s] private life’: at 4-5
  
• Nevertheless Mr Laladidi was then promoted to Assistant Commissioner of Prisons;
  
• In May 1992 action taken by the Prison Officer’s husband and ‘independent witnesses’ resulted in Mr Laladidi and the Prison Officer’s being taken from an apartment, by police, to Central Police Station. Mr Laladidi was next charged by the Respondent with having ‘engaged in immoral conduct by having an extra-marital affair with a female prison officer ... and thus [having] committed a disciplinary offence under ... the Public Service Commission (Constitutional) Regulations 1990’: at 9
  

2.21 Byrne, J. held the decision to discipline Mr Laladidi was a nullity to be quashed as ‘based on [a] charge which ... fails to identify with precision the provisions of Regulation 36 which [he was] alleged to have breached and ... fails to state without ambiguity the precise nature of the charge and the facts [constituting] it’. His Lordship said further that the decision was ‘tainted’ by illegality, irrationality and procedural impropriety per Council of Civil Service Unions and Ors v. Minister for the Civil Service [1983] UKHL 6; (1984) 3 All ER 935, at 950-51, per Diplock, LJ: at 10-11 Even had he been guilty of any charge under Regulation 36, said His Lordship, ‘the penalty imposed ... was excessive’ as in R. v. Barnsley Metropolitan Borough Council; Ex parte Hook (1976) 3 All ER 452, at 457 and 461, per Denning MR and Pennycuick, J: at 12

2.22 (c) Principles Distilled from Awards Made: Albeit three cases only,[2] some general principles can be distilled from State v. Public Service Commission; Ex parte Oveti Laladidi (Judicial Review No. 17 of 1992, 19 July 1995), The State v. The Permanent Secretary for Public Service Commission and Permanent Secretary for Education, Women and Culture; Ex parte Lepani Matea (Judicial Review Action No. HBJ0021 of 1996, 18 March 1998); Permanent Secretary for Public Service Commission v. Matea [1998] FJCA 23; Abu0016u.98s (29 May 1998); The State v. The Public Service Commission; Ex parte Mario Magales Padua (Civil Jurisdiction Judicial Review No. 0009 of 1996, 11 June 1999), along with The Permanent Secretary for the Public Service Commission and Anor v. Epeli Lagiloa (Civil Appeal No. ABU0038 of 1996).

2.23 In Ex parte Lepani Matea the award explicitly ‘payment of entitlements’ – that is, his salary lost in consequence of his dismissal was unnecessary because, by reason of certiorari, Mr Matea recovered his lost entitlements and salary from the date of the purported dismissal.

2.24 Loss of salary due to downgrading was effectively ordered to be paid or made up by the Respondents in Ex parte Oveti Laladidi. Again, this was because with certiorari, the downgrading was quashed. Hence, Mr Laladidi recovered his status and hence his entitlements. As noted, it was not a case of damages, but a case of the operation of the writ of certiorari.

2.25 Albeit loss of wages is special damages (and His Lordship explicitly ruled out any award of special damages), in Ex parte Mario Magales Padua Fatiaki, J. characterised the damages awarded as ‘an award of general damages’. It appears that the $30,000 sum was based upon:

• Dr Padua’s being unemployed since his dismissal;
• his straitened circumstances in consequence, resulting in the selling of his car, household items and disposal of jewelry ‘in order to survive’;
• ‘even having to borrow money’;
• his name’s being removed from the Medical Practitioners Register;
• this meaning he was unable to practice his profession ‘even in a private capacity’;
• loss of professional standing and face in the profession, his family and community as a consequence of deregistration and inability to practice his profession.
  

2.26 The latter aspect – loss of face - is not specifically referred to by His Lordship. However, it appears from the judgment and award that this can properly be inferred as a factor.

2.27 Order 53, Rule 7 says that damages can be awarded so long as the Court is satisfied that, ‘if the claim had been made in an action begun by the application at the time of making his application, he could have been awarded damages’. The framing of the Rule leads to a view that where loss of job or demotion are in issue, it is proper in considering the question of damages to have regard to unfair or unlawful dismissal, and breach of employment contract cases.

2.28 (d) Entitlement to Fair, etc Treatment in Dismissal/Redundancy, etc: The principles elicited from the judicial review cases vis-à-vis damages are fortified by reference to:

• Central Manufacturing Company Ltd v. Kant [2003] FJSC 5; CBV0010.2002 (24 October 2003)[3]
• Bakani v. Carpenters Fiji Ltd [2008] FJCA 6; AAU0038.2006 (1 April 2008)
• Diners Club (NZ) Ltd v. Narayan [1997] FJCA 46; Abu0004u.96s (28 November 1997)
• Native Land Trust Board Employees Association v. Native Land Trust Board [1998] FJCA 28; Abu0028.98s (5 August 1998)
  

2.29 In addition to damages for loss of wages, in the present application general damages are claimed with reference to Mr Prasad’s ‘manner of termination’. This claim is founded in Central Manufacturing Company Ltd v. Kant [2003] FJSC 5; CBV0010.2002 (24 October 2003) where the Supreme Court said:

In our view, the Court of Appeal correctly held that there is an implied term in the modern contract of employment that requires an employer to deal fairly with an employee, even in the context of dismissal. The content of that duty plainly does not extend to a requirement that reasons be given or that a hearing be offered at least where that employer has he right to dismiss without cause, and to make a payment in lieu of notice. It does extend, however, to treating the employee fairly, and with appropriate respect and dignity, in carrying out the dismissal. Each case must, of course, depend upon its own particular facts. However, where, as in the present case, the dismissal is carried out in a manner that is unnecessarily humiliating and distressing, there is no reason in principle why a breach of this implied term should not be found to have occurred: at 23, per Fatiaki, P; Blanchard and Weinberg, JJ.

2.30 In Bakani v. Carpenters Fiji Ltd [2008] FJCA 6; AAU0038.2006 (1 April 2008) the Court of Appeal distinguished the circumstances of Mr Bakani’s dismissal from those in Central Manufacturing, by reference also to Native Land Trust Board Employees Association v. Native land Trust Board [1998] FCA 28; and Diners Club (NZ) Limited v. Prem Naryan (CA No. ABU00A96/S.

2.31 In Bakani the High Court concluded that as employer, Carpenters had ‘through the period of Mr Bakani’s] employment dealt properly with [him] in conformity with the principles stated in the authorities ... cited’. The Court of Appeal said:

Further, Mr Bakani was ‘quite fairly dealt with by [Carpenters] before termination. The treatment [he] received at the hands of [carpenters] was reasonable’. This conclusion was based on a number of factors:

• That Mr Bakani was verbally informed by the Managing Director of the situation and the proposal by Carpenters as to the need for ‘downsizing’ or contracting operations in Papua New Guinea and Fiji, as discussed at a meeting in Malaysia;
  
• This verbal informing occurred before the Managing Director wrote to Mr Bakani putting these matters in writing and notifying him of the redundancy of the position of Deputy Managing Director;
  
• Mr Bakani was informed of the reasons for redundancy, and that he would receive one month’s notice of termination [consistent with his contract] along with other conditions of redundancy.
  

Looking carefully at the terms of redundancy or termination offered to and provided to Mr Bakani, we find it impossible to agree with Mr Bakani’s contention that these were unfair and unreasonable, or that his termination of employment was unfair and unreasonable. On the contrary, the approach taken by Carpenters appears to be extremely fair and reasonable. In addition to the one month’s termination, Mr Bakani was offered the use of his company car for just under six months, with registration, comprehensive insurance and other expenses (apart from petrol and running costs) continuing to be paid by Carpenters; he was offered two directorships at a total of $6000 per year – a far smaller sum than his annual income of course this is true, but nonetheless in all the circumstances an offer [going] beyond anything required by Mr Bakani’s contract; [and other benefits] ...: at 9

2.32 Similarly in the Native Land Trust Board Employees Association case – where a number of redundancies were involves, it was observed that redundancy was specifically referred to in the ‘Terms and Conditions of Employment’ (the collective agreement). The question was whether those terms and conditions were adhered to in the making redundant of some 121 employees, or whether they had not. If they were, then the company had every entitlement to make employees redundant and employees had no recourse; if they were not, then the failure to comply with the terms and conditions provided the employees with a basis for action. In the Diners Club (NZ) Ltd case termination was also in issue:

The only relevant issues in the case were whether the company had the right to determine Mr Narayan’s employment in the way it did, and whether it acted in accordance with the termination cause. The answers to both these questions must be ‘yes’, and this is sufficient to dispose of the appeal: at 3

2.33 Contrarily in Central Manufacturing Company Ltd v. Kant, the Supreme Court upheld the principle that a dismissed employee was entitled to damages in recognition of the way in which his termination was conducted by the employer. Mr Kant was summarily dismissed in circumstances the Court considered were properly to be considered humiliating – he arrived at work one day to find that the General Manager was already then, with other staff telling him (Mr Kant) that the General Manager ‘was upset with him, and that he was to be dismissed’. This arose out of an exchange between Mr Kant and the General Manager in relation to the authorising of employees for attendance at conferences, conventions or courses: Mr Kant considered a memorandum circulated by the General Manager in relation thereto ‘reflected badly on him’ and he sent the General Manager a memorandum of explanation, couched in ‘relatively strong terms’: at 4

2.34 The Supreme Court had regard to section 33(3) of the Constitution providing that every person ‘has the right to fair labour practices, including human treatment and proper working conditions’. However, the amount of damages awarded by the Court of Appeal was set aside, a smaller sum being substituted:

The final matter ... is the petitioner’s argument that the Court of Appeal acted upon speculation and conjecture, and not evidence, when it assessed damages in the amount of $30,000. It was submitted that there was no evidence to support the conclusion that the respondent had suffered anything like the harm found to have been caused by the manner of his dismissal. In particular, there was no evidence that his inability to find alternative employment for two years was brought about by the insensitive treatment accorded to him by the petitioner.

We accept the petitioner’s argument on this point. The respondent called no evidence to suggest that he had suffered any physical or psychological damage resulting from the manner in which he was dismissed. His evidence regarding the damage done to his reputation was tenuous, at best, and did not provide the basis for a link between the manner in which he was treated on the day of his dismissal, and his inability to find alternative employment: at 19

The Court held that Mr Kant was ‘entitled to some compensation for the distress and humiliation ... needlessly inflicted upon him by his employer in the manner in which he was dismissed’. It was considered, however, that the only proper basis upon which this assessment could properly be done was ‘harm to reputation’:

The respondent was publicly humiliated by the manner of his dismissal, involving as it did the unnecessary use of security, and the prevention of access to his office. However, the amount awarded as compensation should be significantly less than that assessed by the Court of Appeal: at 19

2.35 In the upshot, the Court set aside the $30,000 figure set by the Court of Appeal, substituting the sum of $5,000 as compensation:

... for the treatment meted out to him by his employer, in breach of the implied term that he be dealt with fairly, and in good faith, in the context of his dismissal ...: at 19

2.36 (e) Damages – Claim in Present Case: It appears that Mr Prasad has been without income from 20 March 2007: on that day his employment was terminated ‘with immediate effect’: Affidavit in Support, para 24; Memorandum of 20 March 2007, Annexure ‘M’ to Affidavit in Support (Marked ‘received on 23/03/07’) The Written Submissions for Mr Prasad as noted claim loss of wages. The question is whether this claim needs to be made in this form.

2.37 On Monday 24 September 2007, an interim injunction was granted by His Lordship Justice Winter on Monday 24 September 2007, ‘in terms until 26 November 2007’: Court Record It appears, however, that Mr Prasad was not reinstated for the period, nor did he have his wages paid. The interim injunction appears to have simply lapsed.

2.38 Special damages which are wages lost need to be pleaded specifically. In the present case, special damages were not explicitly pleaded. The Court is bound by the decision of the Court of Appeal in this regard, in Credit Corporation (Fiji) Limited v. Wasal Khan and Mohd Nasir Khan (Civil Appeal No. ABU0040 of 2006S, High Court Civil Action No. HBC0344 of 1998, 8 July 2008).

2.39 There, the trial judge awarded damages (including exemplary damages), interest and costs. The action concerned seizure by Credit Corporation of a Caterpillar D6D bulldozer. Credit Corporation’s ‘principal complaint’ in relation to assessment of general damages ‘was that, despite the fact that there was no claim for special damages pleaded by Wasal Khan, a significant proportion of the award of general damages was, in reality, special damages’. For an order of special damages, the claim must be specifically pleaded: at 4, citing Monk v. Redwing Aircraft Co Ltd [1942] 1 KB 182; Haywood & Anor v. Pullinger & Partners Ltd [1950] 1 All ER 581; British Transport Commission v. Gourley [1955] UKHL 4; [1956] AC 185

2.40 The Court said that this rested upon the principle of fairness: ‘to ensure that the party against whom such damages are claimed has proper and particularised notice of the claim’. In the present case, as noted earlier, the claim in the Notice was for ‘damages’ only – with no specification as to ‘special damages’. Is it possible to characterise the lost wages as ‘damages’?

2.41 In Credit Corporation (Fiji) Limited the Court of Appeal said:

... general damages consists in all items of loss with the Plaintiff is not required to specify in his pleadings in order to permit proof and recovery in respect of them at the trial. Special damage consists in all items which must be specified by him before they may be proved and recovery found. The basic test of whether damages are general or special is whether particularity is necessary and useful to warn the defendant of the type of claim and evidence or the specific amount of the claim that which he will be confronted with at trial: at para [14]

2.42 The Court relied upon Ratcliffe v. Evans [1892] UKLawRpKQB 131; [1892] 2 QB 524, Sharma v. Dominion Wire & Cables Ltd (HBC 352 of 1998) and Ilkiw v. Samuels & Ors [1963] 1 All ER 879, where in the one it was held that special damage:

... means the particular damage (beyond the general damage), which results from the particular circumstances of the case, and of the Plaintiff’s claim to be compensated, for which he ought to give warning in his pleadings in order that there may be no surprise at the trial: Ratcliffe, at 528, per Bowen, LJ

And in the second:

... where the precise amount of a particular claim of damages becomes clear before the trial, either because it has already occurred and so crystallised or because it can be measured with complete accuracy, its exact loss must be pleaded as special damage’: Sharma, quoting from McGregor on Damages 17th edn, para [43-101]

Whilst in the third:

... Willmer, LJ (with the concurrence of Danckwerts and Diplock LJJ) ... held that in reality the general damages award in that case was indeed special damages disguised as general damages. The appeal ... was allowed on that basis [and the case] is a rigorous application of the rule ...: Ilkew, see para [19]

2.43 The trial judge in Credit Corporation (Fiji) Ltd said in his judgment that he was ‘not prepared to construct out of the pleadings a recognizable claim for any particular special damages as invited [by counsel for the plaintiff]’: Court Record, p. 21; at para [16]

2.44 On appeal, the Court held that albeit following the proper principles in regard to the refusal to award special damages in absence of their being pleaded, the trial judge nonetheless awarded ‘special damages’ under the heading of ‘general damages’. What was sought was compensation for income lost by the unlawful seizure and claimed incapacitation of the Caterpillar machine. The Court said that the judge was entitled to take the facts ‘which would have founded a claim for special damages as evidence which could assist him in assessing general damages’ however this ‘does not entitle a court to award as general damages which are in truth special damages [which] should ... have been subject to the rigours of pleading ...’: at para [20]

2.45 The Court went on to point out that loss of earnings asserted by Mr Khan ‘were perfectly quantifiable both as to amount and as to the duration ... [and] could have been pleaded and calculated as special damages’:

This court would go considerably further than that. In simple language, they had to be presented as special damages. The claim for deprivation of loss of profits by the bulldozer being in the custody of Credit Corporation from late December 1998 until August 1999 as perfectly quantifiable and the judge clearly undertook this exercise: at para 21]

2.46 Hence, in the present application albeit Counsel for Mr Prasad invites the Court to award damages for loss of earnings over the period from his dismissal (or suspension without pay as asserted by the Respondents), this the Court is not entitled to do, in the absence of the loss having been pleaded. I turned to the Affidavit in Support to determine whether the Court would be entitled to base a claim for special damages in the way of lost wages in accordance with what is said there, however, it is not possible to construct a ‘pleading’ for such special damages from the Affidavit, nor from the Affidavit in Reply.

2.47 This is said as a caution to parties in judicial review to ensure that if they wish to claim special damages, then it should be specifically pleaded.

2.48 However, what needs to be affirmed in the present case, consistent with The Permanent Secretary for the Public Service Commission and Anor v. Epeli Lagiloa, is that having succeeded in his application for certiorari, Mr Prasad succeeds also in his claim for recovery of wages and entitlements. This is because it need not be pleaded as special damages. Rather, the decision having been quashed, Mr Prasad is in a position of having been effectively employed by the First Respondent from the time of the purported dismissal (or suspension as the Respondents say), and hence is entitled to pay.

2.49 If that were not the case, the Court could in any event make an award properly in respect of the period from the date of dismissal, being 20 March 2007 up to and including 26 November 2007 upon the basis that the Court granted an interim injunction in respect of the Respondents’ decision up to that date: Winters, J. 24 September 2007 Had the interim injunction been honoured by the Respondents, Mr Prasad would have received wages for that period, as he would have been reinstated. Even if the Respondents wish to assert that Mr Prasad was suspended rather than having his employment terminated, they are still left with the Order of the Court made on 24 September 2007 as to the interim injunction. In that case, it would be the decision to suspend Mr Prasad without pay that was stayed and, hence, he would (again) have been reinstated with full pay (and any other entitlements).

2.50 The Court can make an award of general damages to cover the humiliation and loss of face confronted by Mr Prasad in the termination of his employment, particularly taking into account his lengthy period of service with the Respondents. This is, in my view, exacerbated by the matters to which Counsel refers in the Written Submissions, namely the matters set out in the substantive judgment as to the way in which the Respondents approached the decision-making process and its effect upon Mr Prasad. All this is set out in Prasad v. Divisional Engineer Northern (No. 1) [2008] FJHC 161; HBJ03.2007 (17 July 2008) and need not be repeated here.

2.51 In setting the sum under this head, I have taken into account particularly the decision of the Supreme Court in Central Manufacturing Company Ltd v. Kant [2003] FJSC 5; CBV0010.2002 (24 October 2003) where the principle was recognised that a contract of employment has an implied term that termination will be carried out ‘consistent with fairness’ and that parties ‘will act fairly and reasonably with mutual trust and confidence’, and that the sum of $5,000 was set as compensation for the treatment ‘meted out to [Mr Kant] by his employer, in breach of the implied term that he be dealt with fairly, and in good faith, in the context of his dismissal’: at 19

2.52 It seems to me that, taking into account:

• the overall treatment of Mr Prasad;
• the contradictions and confusions imposed upon him by the Respondents;
• the period over which the events occurred that led ultimately to his dismissal and then to notice (never received by him) of the termination of the termination and substitution of suspension without pay;
• the requirement that he respond albeit he and a work colleague as well as his superior had already responded to many of the matters raised;
• that he responded again to those and other matters;
• that no charges were ever laid against him, and still as far as the Court is aware have not been, and that according to the Respondents charges are ‘in the offing’ but as noted have never been articulated;
  

what occurred in Mr Prasad’s case outweighs what occurred in Mr Kant’s case. What occurred in Mr Kant’s case was in a sense more immediately a spectacle – being ‘locked out’ of his office and escorted away by security guards, and the humiliation attendant upon being advised by co-employees that he was to be dismissed by the General Manager, before he was even advised himself by the General Manager of his instant dismissal. However Mr Prasad’s humiliation and loss of face – ‘damage to reputation’ - occurred over a lengthy period with all the matters set out in Prasad v. Divisional Engineer Northern (No. 1) [2008] FJHC 161; HBJ03.2007 (17 July 2008) and alluded to briefly here.

2.53 I have also borne in mind that the decisions earlier referred to involved professional people – medical practitioner (The State v. The Public Service Commission; Ex parte Mario Magales Padua (Civil Jurisdiction Judicial Review No. 0009 of 1996, 11 June 1999)), and accountant/manager (Central Manufacturing Company Ltd v. Kant [2003] FJSC 5; CBV0010.2002 (24 October 2003). Mr Prasad was an Accounts Clerk (Affidavit in Support, para 1) or ‘Chief Clerk A’ (Affidavit in Reply, para 6(vii)). If Mr Prasad is classified as not being in a ‘professional’ or senior management position, this does not in any way lessen the humiliation and loss of face he can properly be taken to have suffered in all the circumstances amongst his work colleagues, in his family and community, and in the community generally. Section 33 (3) of the Constitution makes no distinction on the basis of class, economic status or professional or managerial status or position. This is consistent with the principle of equality expressed in section 38 of the Constitution. The ‘harm to reputation’ basis for the award of general damages in Central Manufacturing Company Ltd v. Kant applies equally to Mr Prasad as to Mr Kant and Dr Padua.

2.54 The appropriate award of general damages in this aspect should be almost double that accruing to Mr Kant by reason of all the aforesaid matters, and is set at $8,500.00.

2.55 Hence, the damages award is:

1. $8,500 in respect of general damages for humiliation, loss of face, etc constituting damage to reputation as set out at para [2.52] and generally in Prasad v. Divisional Engineer Northern (No. 1) [2008] FJHC 161; HBJ03.2007 (17 July 2008)
   

3. Indemnity Costs

The costs incurred by the Applicant are listed as follows:

3.1 (a) Applicant’s Submissions: The Applicant’s submissions rely upon:

• The conduct of the Respondents in the running of the case through the Court proceedings;
• That judicial review is intended to provide a ‘relatively straight forward and prompt determination of the case’, citing Anuradha Charan v. Public Service Commission and Ors (Civil Appeal Judicial Review No. 2 of 1992)
• That it ‘should have been apparent to the Respondent as early as 17 September 2007 that the Applicant’s application would succeed. Despite the order of stay granted on 24 September 2007 the Respondent failed to employ the Applicant thus flouting the order of the Court’: p. 4
  

3.2 (b) Principles Governing Indemnity Costs: Principles governing the award of indemnity costs are set out in a number of authorities.

3.3 General principles include:

• A court has ‘absolute and unfettered’ discretion vis-à-vis the award of costs but discretion ‘must be exercised judicially’: Trade Practices Commission v. Nicholas Enterprises (1979) 28 ALR 201, at 207
  
• The question is always ‘whether the facts and circumstances of the case in question warrant making an order for payment of costs other than by reference to party and party’: Colgate-Palmolive Company v. Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225, at 234, per Sheppard, J.
  
• A party against whom indemnity costs are sought ‘is entitled to notice of the order sought’: Huntsman Chemical Company Australia Limited v. International Cools Australia Ltd (1995) NSWLR 242
  
• That such notice is required is ‘a principle of elementary justice’ applying to both civil and criminal cases: Sayed Mukhtar Shah v. Elizabeth Rice and Ors (Crim Appeal No. AAU0007 of 1997S, High Court Crim Action No. HAA002 of 1997, 12 November 1999), at 5, per Sir Moti Tikaram, P. Casey and Barker, JJA
  
• ‘... neither considerations of hardship to the successful party nor the over-optimism of an unsuccessful opponent would by themselves justify an award beyond party and party costs. But additional costs may be called for if there has been reprehensible conduct by the party liable’: State v. The Police Service Commission; Ex parte Beniamino Naviveli (Judicial Review 29/94; CA Appeal No. 52/95, 19 August 1996), at 6
  
• Usually, party/party costs are awarded, with indemnity costs awarded only ‘where there are exceptional reasons for doing so’: Colgate-Palmolive Co. v. Cussons Pty Ltd at 232-34; Bowen Jones v. Bowen Jones [1986] 3 All ER 163; Re Malley SM; Ex parte Gardner []2001] WASCA 83; SDS Corporation Ltd v. Pasonnay Pty Ltd & Anor [2004] WASC 26 (S2) (23 July 2004), at 16, per Roberts-Smith, J.
  
• Costs are generally ordered on a party/party basis, but solicitor/client costs can be awarded where ‘there is some special or unusual feature of the case to justify’ a court’s ‘exercising its discretion in that way’: Preston v. Preston [1982] 1 All ER 41, at 58
  
• Indemnity costs can be ordered as and when the justice of the case so requires: Lee v. Mavaddat [2005] WASC 68 (25 April 2005), per Roberts-Smith, J.
  
• For indemnity costs to be awarded there must be ‘some form of delinquency in the conduct of the proceedings’: Harrison v. Schipp [2001] NSWCA 13, at paras [1], [153]
  
• Circumstances in which indemnity costs are ordered must be such as to ‘take a case out of the "ordinary" or "usual" category ...": MGICA (1992) Ltd v. Kenny & Good Pty Ltd (No. 2) [1996] FCA 862; (1996) 140 ALR 707, at 711, per Lindgren J.
  
• ‘... it has been suggested that the order of costs on a solicitor and client basis should be reserved to a case where the conduct of a party or its representatives is so unsatisfactory as to call out for a special order. Thus, if it represents an abuse of process of the Court the conduct may attract such an order’: Dillon and Ors v. Baltic Shipping Co. (‘The Mikhail Lermontov’) (1991) 2 Lloyds Rep 155, at 176, per Kirby, P.
  
• Solicitor/client or indemnity costs can be considered appropriately ‘whenever it appears that an action has been commenced or continued in circumstances where the applicant, properly advised, should have known ... he had no chance of success’: Fountain Selected Meats (Sales) Pty Ltd v. International Produce Merchants Ltd & Ors (1998) 81 ALR 397, at 401, per Woodward, J.
  
• Albeit rare, where action appears to have commenced/continued when ‘applicant ... should have known ... he had no chance of success’, the presumption is that it ‘commenced or continued for some ulterior motive or ... [in] wilful disregard of the known facts or ... clearly established law’ and the court needs ‘to consider how it should exercise its unfettered discretion’: Fountain Selected Meats, at 401, per Woodward, J.
  
• Where action taken or threatened by a defendant ‘constituted, or would have constituted, an abuse of the process of the court’, indemnity costs are appropriate: Baillieu Knight Frank (NSW) Pty Ltd v. Ted Manny Real Estate Pty Ltd (1992) 30 NSWLR 359, at 362. per Power, J.
  
• Similarly where the defendant’s actions in conducting any defence to the proceedings have involved an abuse of process of the court whereby the court’s time and litigant’s money has ‘been wasted on totally frivolous and thoroughly unjustified defences’: Baillieu Knight Frank, at 362, per Power, J.
  
• Indemnity costs awarded where ‘the defendant had prima facie misused the process of the court by putting forward a defence which from the outset it knew was unsustainable ... such conduct by a defendant could amount to a misuse of the process of the court’: Willis v. Redbridge Health Authority (1960) 1 WLR 1228, at 1232, per Beldam, LJ
  
• ‘Abuse of process and unmeritorious behaviour by a losing litigant has always been sanctionable by way of an indemnity costs order inter partes. A party cannot be penalised [for] exercising its right to dispute matters but in very special cases where a party is found to have behaved disgracefully or where such behaviour is deserving of moral condemnation, then indemnity costs may be awarded as between the losing and winning parties’: Ranjay Shandil v. Public Service Commission (Civil Jurisdiction Judicial Review No. 004 of 1996, 16 May 1997), at 5, per Pathik, J. (quoting Jane Weakley, ‘Do costs really follow the event?’ (1996) NLJ 710 (May 1996))
  
• ‘It is sufficient ... to enliven the discretion to award [indemnity] costs that, for whatever reasons, a party persists in what should on proper consideration be seen to be a hopeless case’: J-Corp Pty Ltd v. Australian Builders Labourers Federation Union of Workers (WA Branch)(No. 2) [1993] FCA 70; (1993) 46 IR 301, at 303, per French, J.
  
• ‘... where a party has by its conduct unnecessarily increased the cost of litigation, it is appropriate that the party so acting should bear that increased cost. Persisting in a case which can only be characterised as "hopeless" ... may lead the court to [determine] that the party whose conduct gave rise to the costs should bear them in full’: Quancorp Pty Ltd & Anor v. MacDonald & Ors [1999] WASC 101, at paras [6]-[7], per Wheeler, J.
  
• However, a case should not be characterised as ‘hopeless’ too readily so as to support an award of indemnity costs, bearing in mind that a party ‘should not be discouraged, by the prospect of an unusual costs order, from persisting in an action where its success is not certain’ for ‘uncertainty is inherent in many areas of law’ and the law changes ‘with changing circumstances’: Quancorp Pty Ltd & Anor v. MacDonald & Ors [1999] WASC 101, at paras [6]-[7], per Wheeler, J.
• The law reports are replete with cases which were thought to be hopeless before investigation but were decided the other way after the court allowed the matter to be tried: Medcalf v. Weatherill and Anor [2002] UKHL 27 (27 June 2002), at 11, per Lord Steyn
  
• Purpose of indemnity costs is not penal but compensatory so awarded ‘where one party causes another to incur legal costs by misusing the process to delay or to defer the trial and payment of sums properly due’; the court ‘ought to ensure so far as it can that the sums eventually recovered by a plaintiff are not depleted by irrecoverable legal costs’: Willis v. Redbridge Health Authority, at 1232, per Beldam, LJ
  
• Actions of a Defendant in defending an action, albeit being determined by the trial judge as ‘wrong and without any legal justification, the result of its own careless actions’, do ‘not approach the degree of impropriety that needs to be established to justify indemnity costs ... [R]egardless of how sloppy the [Defendant] might well have been in lending as much as $70,000 to [a Plaintiff], they had every justification for defending this action ... The judge was wrong to award [indemnity costs] in these circumstances. He should have awarded costs on the ordinary party and party scale’: Credit Corporation (Fiji) Limited v. Wasal Khan and Mohd Nasir Khan (Civil Appeal No. ABU0040 of 2006S; High Court Civil Action No. HBC0344 of 1998, 8 July 2008), per Pathik, Khan and Bruce, JJA, at 11
  

3.4 (c) Defining ‘Improper’, ‘Unreasonable’ or ‘Negligent’ Conduct in Legal Proceedings as Guide to Indemnity Costs Awards: Cases where ‘wasted costs’ rules or ‘useless costs’ principles have been applied against solicitors where their conduct in proceedings has led to delay and/or abuse of process can provide some assistance in determining whether conduct in proceedings generally may be such as to warrant the award of indemnity costs. These cases specifically relate to solicitors’ conduct rather than directly touching upon the indemnity costs question; nonetheless the analysis or findings as to what constitutes conduct warranting an award of costs can be helpful. See for example:

• Ridehalgh v. Horsefield and Anor [1994] Ch 205
• Medcalf v. Weatherill and Anor [2002] UKHL 27 (27 June 2002)
• Harley v. McDonald [2001] UKPC 18; [2001] 2 AC 678
• Kemajuan Flora SDN Bh v. Public Bank BHD & Anor (High Court Malaya, Melaka, Civil Suit No. 22-81-2001, 25 January 2006)
• Ma So So Josephine v. Chin Yuk Lun Francis and Chan Mee Yee (FACV No. 15 of 2003, Court of Final Appeal Hong Kong Special Administrative Region, Final Appeal No. 15 of 2003 (Civil)(On Appeal from CACV No. 382 of 2002, 16 September 2004)
• SZABF v. Minister for Immigration (No. 2) [2003] FMCA 178
• Heffernan v. Byrne [2008] FJCA 7; ABU0027.2008 (29 May 2008)
  

3.5 Some of the matters referred to include:

• At the hearing stage, the making of or persisting in allegations made by one party against another, unsupported by admissible evidence ‘since if there is not admissible evidence to support the allegation the court cannot be invited to find that it has been proved, and if the court cannot be invited to find that the allegation ahs been proved the allegation should not be made or should be withdrawn: Medcalf v. Weatherill and Anor, at 8, per Lord Bingham
• At the preparatory stage, in relation to such allegations – not necessarily having admissible evidence but there should be ‘material of such a character as to lead responsible counsel to conclude that serious allegations could properly be based upon it: Medcalf v. Weatherill and Anor, at 8, per Lord Bingham
• Failures to appear, conduct which leads to an otherwise avoidable step in the proceedings or the prolongation of a hearing by gross repetition or extreme slowness in the presentation of evidence or argument are typical examples of wasting the time of the court or an abuse of its processes resulting in excessive or unnecessary costs to litigants: Harley v. McDonald, at 703, para [50] (English Privy Council)
• Starting an action knowing it to be false is an abuse of process and may also involve knowingly attempting to mislead the court: Ma So So Josephine v. Chin Yuk Lun Francis and Chan Mee Yee (FACV No. 15 of 2003, Court of Final Appeal Hong Kong Special Administrative Region, Final Appeal No. 15 of 2003 (Civil)(On Appeal from CACV No. 382 of 2002, 16 September 2004), at para [43], per Ribeiro, PJ (Li, CJ, Bokhary and Chan, PJ and Richardson, NPJ concurring)
• Lending assistance to proceedings which are an abuse of the process of the court – using litigious procedures for purposes for which they were not intended, ‘as by issuing or pursuing proceedings for reasons unconnected with success in the litigation or pursuing a case known to be dishonest’ or evading rules intended to safeguard the interests of justice ‘as by knowingly failing to make full disclosure on ex parte application[s] or knowingly conniving at incomplete disclose rue of documents’: Ridehalgh v. Horsefield [1994] Ch 205, at 234, per Bingham, MR
• Initiating or continuing multiple proceedings which amount to abuse of process: Heffernan v. Byrne [2008] FJCA 7; ABU0027.2008 (29 May 2008), per Hickie, J.
  

3.6 (d) Specific Circumstances of Grant/Denial Indemnity Costs: Specific instances supporting or denying the award of indemnity costs include:

• Indemnity costs follow per a ‘Calderbank offer’, that is, where a party makes an offer or offers prior to trial, which is/are refused, and that party succeeds at trial on a basis which is better than the prior offer: Calderbank v. Calderbank [1975] 3 WLR 586
  
• However, no indemnity costs awarded where Calderbank letter contains no element of compromise, making it not unreasonable for the party not to accept the offer. The question is ‘... whether the offeree’s failure to accept the offer, in all the circumstances, warrants departure from the ordinary rule as to costs ...’: SMEC Testing Services Pty Ltd v. Campbelltown City Council [2000] NSWCA 323, at para [37], per Giles, JA Hence, if the offer is not a genuine offer of compromise and/or there is no appropriate opportunity provided to consider and deal with it, then no indemnity costs follow: Richard Shorten v. David Hurst Constructions P/L; D. Hurst Constructions v. RW Shorten [2008] AdjLR 06/17 (17 June 2008), per Einstein, J. (NSW Supreme Court, Equity Division T&C List); Leichhardt Municipal Council v. Green [2004] NSWCA 341, at paras [21]-24], [36], per Santow, JA, Stein, JA (concurring); Herning v. GWS Machinery Pty Ltd (No. 2) [2005] NSWCA 375, at paras [4]-[5], per Handley, Beazley and Basten, JJA; Elite Protective Personnel v. Salmon [2007] NSWCA 322, at para [99]; Donnelly v. Edelsten [1994] FCA 992; [1994] 49 FCR 384, at 396
  
• Indemnity costs awarded:
  
  • upon a winding-up petition’s being presented on a debt known to the petitioner to be genuinely disputed on substantial grounds;
  • the clearly established law being that a winding up order will not be granted in such circumstances, meaning that the petitioner ‘had no chance of successfully obtaining a winding up order’;
  • where in these circumstances the filing of the petition ‘constituted a deliberate tactical manipulation of the winding up process by the [petitioner, the State Government Insurance Commission ‘SGIC’] for the purposes of bringing very substantial pressure to bear’ on Bond Corp Holdings ‘BCH’;
  • this in the circumstances meant that the ‘filing of the petition was an abuse of process of the court in the true sense of that expression’;
  • the discretion to stay the petition should not be exercised because this would ‘cause BCH serious harm’ meaning it would be ‘extremely difficult for BCH to be able to conduct its business normally if the petition [were] not dismissed’: citing Re Lympne Investments [1972] 1 WLR 523, at 527, per Megarry, J.; also Re Glenbawn Park Pty Ltd [1977] 2 ACLR 288, at 294, per Yeldham, J.
  • an abuse of process ‘having been established in the circumstances outlined, justice requires the award of solicitor and client, or, rather, "indemnity" costs’ so that ‘the SGIC should be ordered to pay all the costs incurred by BCH except insofar as they are of an unreasonable amount or have been unreasonably incurred, so that, subject to [these] exceptions, BCH be completely indemnified by the SGIC for its costs’, citing Foundation Selected Meats (Sales) Pty Ltd v. International Produce Merchants (1988) 81 ALR 397, at 410, per Woodward J.: Re Bond Corp Holdings Ltd (1990) 1 ACSER 350, at 13, per Ipp, J.
    
• Indemnity costs are appropriate where an applicant (in an unfair dismissal):
  • ‘insists’ over a respondents’ objections that an application should proceed to trial rather than await the outcome of other possible litigation (including a police investigation);
  • fails repeatedly, despite allowances, to meet deadlines for lodgment of a witness statement;
  • fails to advise her lawyers of her whereabouts so denying them of the ability to inform the court of reasons for seeking an unqualified adjournment less than a week prior to trial;
  • fails to comply with directions to provide a current address, consult a medical specialist and obtain a report of fitness to attend the trial;
  • fails to appear at the final hearing when on notice that the application will be dismissed in event of such failure: Nicole Pender v. Specialist Solutions Pty Ltd (No. B599 of 2004. 17 May 2005), per Bloomfield, Commissioner
    
• Indemnity costs denied as against a Plaintiff who discontinued a claim for a permanent injunction to restrain a Defendant’s industrial action, where the Defendant had filed a chamber summons seeking to have the Plaintiff’s claim struck out as an abuse of process: Cooperative Bulk Handling Ltd v. Australian Manufacturing Workers Union (WA Branch)(Unreported, WASC, Lib. No. 970190, 30 April 1997), per Wheeler, J.
• Indemnity costs cannot be awarded in a criminal appeal, albeit ‘in criminal appeals, as in civil cases, unreasonable conduct by the unsuccessful party might increase a usual award’: Sayed Mukhtar Shah v. Elizabeth Rice and Ors (Crim Appeal No. AAU0007 of 1997S, High Ct Crim Action No. HAA02 of 1997, 12 November 1999), at 4, per Sir Moti Tikaram, P., Casey and Barker, JJA
• Indemnity costs awarded then reversed on appeal where solicitor held liable for costs (under a ‘wasted costs’ order) in initiating action for clients where solicitor taken to have known that the basis of the clients’ action was wholly false:
  

The Judge ordered the Appellant [solicitor] to pay those costs on an indemnity basis. No reasons were given although one surmises that this must have been a demonstration of the disapproval he had forcefully expressed regarding the [solicitor]’s conduct. In my view, that is not a sufficient justification. The wasted costs order itself is the response (both punitive and compensatory) to the misconduct which attracted the disapproval. That disapproval cannot be allowed to spillover into the costs order made in the ... proceedings where there has been no procedural or other impropriety justifying a special costs order in [those] proceedings. It is important that the right of a solicitor faced with an application under [the relevant ‘wasted costs’ rule] to mount a defence is not undermined.

There was no apparent reason in the present case for making an indemnity costs order. Indeed, the procedural difficulties [that arose] were attributable to the Respondents’ legal advisers’ initially flawed conception of their case rather than to anything done on the Appellant [Solicitor]’s behalf in the wasted costs proceedings. Her decision not to give evidence or to recall witnesses in fact enabled the complaint to be dealt with summarily at a hearing lasting one day. I therefore consider the indemnity costs order unjustified. It is of interest to note that on the appeal to the Court of Appeal, the costs order made was on a party and party basis even though the wasted costs order was upheld: Ma So So Josephine v. Chin Yuk Lun Francis and Chan Mee Yee (FACV No. 15 of 2003, Court of Final Appeal Hong Kong Special Administrative Region, Final Appeal No. 15 of 2003 (Civil)(On Appeal from CACV No. 382 of 2002, 16 September 2004), at paras [95]-[96], per Ribeiro, PJ (Li, CJ, Bokhary and Chan, PJ and Richardson, NPJ concurring)

• Contra – where in a wasted costs application, the registrar’s decision to award costs on an indemnity basis against the solicitors was upheld on appeal: Kemajuan Flora SDN Bh v. Public Bank BHD & Anor (High Court Malaya, Melaka, Civil Suit No. 22-81-2001, 25 January 2006), at 8, per Low Hop Bing J. Albeit there was no explicit reference to the indemnity costs aspect, it appears that the conduct by the solicitors in the proceedings was considered to warrant indemnity costs:
  

In my judgment, it is to be noted that the ... factual background is clear and unambiguous, as it shows the indefatigable initiative and endless effort on the part of the plaintiff’s solicitors who were so insistent in bringing litigations with no regard to any merit whatsoever, thereby resulting in the consistent and persistent dismissals with the plaintiff being mulcted in costs. Such costs could well have been [nipped] in the bud had the plaintiff’s solicitors refrained from engaging in the ... futile litigations. There can be no doubt that cots have been incurred improperly or without reasonable cause or wasted within the ambit of [the relevant ‘wasted costs’ rule: Kemajuan Flora SDN Bh v. Public Bank BHD & Anor, at 7, per Low Hop Bing, J.

3.7 (e) Indemnity Costs in Judicial Review: A perusal of judicial review applications over the years 1991-1993 and 1995-2000 indicates that costs are not infrequently awarded – whether to a successful applicant or against the unsuccessful applicant. In some instances, costs have been borne by both parties and in others no order for costs is made, or costs are ‘in the cause’. Over these periods, there are two examples of indemnity costs being awarded in such applications.

3.8 In The State v. Public Service Appeal Board; Ex parte Nunsamy Reddy (Civil Jurisdiction Judicial Review No. HBJ 0040 of 1999, 17 July 2000) indemnity costs were awarded where the Second Respondents had given ‘an undertaking at leave stage, that the appointment of [the candidate deemed successful] would remain provisional, until the determination of [the] application’, but ‘did not honour [the] undertaking’. The candidate ‘had been confirmed in the position of Executive Officer’ which was the subject of the decision under review. Her Ladyship Justice Shameem said:

I consider such a flagrant breach of an undertaking made to the court to be reprehensible. In the circumstances I consider indemnity costs to be in order ...’: The State v. Public Service Appeal Board; Ex parte Munsamy Reddy, at 14

3.9 In Ranjay Shandil v. Public Service Commission (Civil Jurisdiction Judicial Review No. 004 of 1996, 16 May 1997), the Court had made an Order as to costs (as amended by consent and sealed on 7 April 1997) that the Respondent Public Service Commission (PSC) ‘pay the costs of this action to be taxed if not agreed with liberty to counsel for the Applicant to apply to argue the Solicitor/Client basis of taxation’: at 1, per Pathik, J. The application was opposed.

3.10 His Lordship Pathik, J. said that it was his findings of fact in the substantive application which would decide whether costs would be granted on an indemnity basis or not. In the upshot, the decision was that costs were to be paid by the Respondent to the Applicant ‘taxed on a "solicitor and client" basis by the Chief Registrar of the High Court with costs of [the] Summons against the Respondent ... to be taxed unless agreed’: at 10

3.11 A clerical officer, the Applicant Mr Shandil was interdicted and charged by the Respondent, then acquitted of the criminal charges laid against him. His appointment was terminated some two years after interdiction and some 11 months after acquittal. In the substantive application the Court said:

... it is abundantly clear from the undisputed facts that the PSC had in breach of the relevant regulations ... annulled the applicants’ appointment and refused to reinstate him after his acquittal on criminal charges without specifying any reason whatsoever: Respondent refused to reinstate him: at 6; quoted Ranjay Shandil, 16 May 1997, at 2

3.12 Counsel for the PSC ‘could not explain to the Court’ why Mr Shandil was ‘not soon reinstated when there is a clear provision it hat regard in Regulation 53’. It was a ‘matter of great concern’ said the Court, that in his Affidavit in Reply the Permanent Secretary for the PSC swore that Mr Shandil ‘never received any favourable reports from his supervising officers’, yet it ‘transpired during the hearing that this statement was untrue’:

All that I have stated above are sufficient indication of malice, oppression and a blatant abuse of the Regulations: at 3

3.13 His Lordship concluded his decision in the substantive application by holding that the PSC ‘disregarded its own Regulations’ and was ‘guilty of being procedurally unfair’: Counsel for the PSC conceded at the hearing that Mr Shandil was ‘unfairly and unlawfully terminated from employment’. Further, there was ‘no doubt that [the] PSC was bent on terminating [Mr Shandil’s] employment knowingly in complete disregard of its own Regulations which are meant to be followed ... Counsel for the respondent ... said that [Mr Shandil] "would still be interdicted" if the matter goes back to the Commission’:

I cannot leave this subject without commenting that it would have saved a waste of public funds if the officers dealing with matters of this nature paid greater attention to the Regulations. Also, whatever legal advice the PSC gets should be such that it is proper. Had all concerned been more vigilant and careful, matters would not have come to this pass resulting in judicial review with the consequent loss of tie, effort and money in deciding something which should have been as clear as crystal to the decision-makers: at 3

3.14 (f) Indemnity Costs in the Present Case: In making the determination here to award indemnity costs, the Court is particularly persuaded by what was said in Ranjay Shandil v. Public Service Commission (Civil Jurisdiction Judicial Review No. 004 of 1996, 16 May 1997), and His Lordship Justice Pathik’s citing Tickell v. Trifleska Pty Ltd (1990) 25 NSWLR 353, where Rogers, CJ Comm Div NSW Supreme Court said:

It is the primary aim of any judicial system to attempt to bring the parties to a point where, with fairness to themselves, they are able to dispose of the dispute between them by compromise. It is only in the last resort that a dispute should proceed to trial and to determination. That is for any number of reasons. It is in the interests of the community that scarce resources, such as the court, should not be over-taxed. It is in the interests of the community and of the parties themselves that they should not engage in the rancour which a dispute in court necessarily entails. It is in the interests of the parties themselves to save themselves the expenditure of time and energy necessarily entailed in participate in contested court proceedings.

3.15 Pathik, J. said in this regard that these ‘words of wisdom’ should be borne in mind ‘as underlying the concept of the use of cost orders to encourage compromise’. Had the Respondent ‘given thought’ to those views, then ‘matters would not have come to a head which eventually very belatedly forced the Respondent to concede the error’:

In the outcome, on the facts of this case, bearing in mind the authorities and the factors which ought to be considered on an application of this nature, I find this to be an appropriate case in which I ought to make an order for costs on an indemnity basis: at 9

3.16 The present case is an appropriate case for costs on an indemnity basis. Here, the matters set out in Prasad v. Divisional Engineer Northern (No. 1) [2008] FJHC 161; HBJ03.2007 (17 July 2008) as to the approach taken by the Respondents in the Court proceedings are taken into account, including failure to appear on a number of occasions – before the Master on 15 November 2007, 3 July 2008: Court Record Also the reversal of the termination and substitution or revival of suspension, which was said to have been notified to Mr Prasad by Memorandum of 24 July 2007: Annexure IVK1 to the Affidavit in Reply, yet never advised to the Court until 28 May 2008, by the filing of that Affidavit.

3.17 Further, indemnity costs are consistent with the determination of Her Ladyship Justice Shameem in The State v. Public Service Appeal Board; Ex parte Nunsamy Reddy (Civil Jurisdiction Judicial Review No. HBJ 0040 of 1999, 17 July 2000) where an undertaking given at leave stage was not complied with by the Second Respondent. Indemnity costs were ‘in order’ in respect of ‘a flagrant breach of an undertaking made to the court’: at 14 In the present case, the Respondents did not comply with the interim injunction made by Winters, J.

3.18 The foregoing is consistent with the principles set out in respect of the award of indemnity costs, which have been fully taken into account in this determination, and in particular as to the exercise of discretion vis-à-vis costs: Trade Practices Commission v. Nicholas Enterprises (1979) 28 ALR 201, at 207

3.19 The facts and circumstances of the case warrant making an order for payment of costs other than by reference to party and party’: Colgate-Palmolive Company v. Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225, at 234, per Sheppard, J.

3.20 Indemnity costs were notified to the Respondents by the Applicant in the Notice: Huntsman Chemical Company Australia Limited v. International Cools Australia Ltd (1995) NSWLR 242; Sayed Mukhtar Shah v. Elizabeth Rice and Ors (Crim Appeal No. AAU0007 of 1997S, High Court Crim Action No. HAA002 of 1997, 12 November 1999), at 5, per Sir Moti Tikaram, P. Casey and Barker, JJA

3.21 The reasons set out above constitute ‘exceptional reasons’ for awarding indemnity costs, and the justice of the case so requires: Colgate-Palmolive Co. v. Cussons Pty Ltd at 232-34; Bowen Jones v. Bowen Jones [1986] 3 All ER 163; Re Malley SM; Ex parte Gardner []2001] WASCA 83; SDS Corporation Ltd v. Pasonnay Pty Ltd & Anor [2004] WASC 26 (S2) (23 July 2004), at 16, per Roberts-Smith, J.; Lee v. Mavaddat [2005] WASC 68 (25 April 2005), per Roberts-Smith, J.

4. Conclusion

The written and oral submissions of Counsel for the parties were of considerable assistance in the substantive matter and the written submissions of Counsel similarly here.

ORDERS

1. The Respondents to pay to the Plaintiff the sum of $8,500 in respect of general damages.
   
2. The Respondents to pay to the Plaintiff indemnity costs in the amount of $7,200 (including VAT).
   
3. Orders 1 and 2 to be complied with by the Respondents within 28 days of the date of these Orders.
   

Jocelynne A. Scutt
Judge

Suva
25 September 2008

^[1] Note: This decision is not available on austlii; the substantive decision alone (together with a decision in relation to an application to raise new evidence and submissions in relation there to) is available on austlii: . The decision in relation to indemnity costs can be found on the Supreme Court of Western Australia website at http://decisions.justice.wa.gov.au/supreme/supdcsn.nsf (accessed 22 September 2008).
^[2] All that could be found in the period searched, illustrating the relative rarity of awards of damages or that might have been characterised in this way – noting The Permanent Secretary for the Public Service Commission and Anor v. Epeli Lagiloa (Civil Appeal No. ABU0038 of 1996).
^[3] Referred to by Counsel for Mr Prasad.