Supreme Court New South Wales

• Medium Neutral Citation: Porter v Le; Porter v Western Sydney Local Health District [2014] NSWSC 101
• Hearing dates: 2 August 2013
• Decision date: 21 February 2014
• Before: Harrison J

Decision

Defendants' applications dismissed

• Catchwords: PROCEDURE - medical negligence -representation by tutor of legally incapacitated person - application for stay pending removal of tutor - Uniform Civil Procedure Rules 2005 7.18 - impecunious tutor - whether tutor's financial status a prerequisite for office - distinction between responsibility for costs and financial capacity to meet adverse costs order
• Legislation Cited: Civil Liability Act 2005; Civil Procedure Act 2005; Uniform Civil Procedure Rules 2005
• Cases Cited: Al Mousawy bht Imelda Margaret Dodds v Howitt-Stevens Constructions Pty Ltd & Ors (No 2) [2010] NSWSC 1398; Azar v Kathirgamalingan [2012] NSWCA 429; Barton v R [1981] HCA 48; (1981) 147 CLR 75; Batistatos bht Rosebottom v RTA [2006] HCA 27; (2006) 226 CLR 256; Clyne v NSW Bar Association [1960] HCA 40; (1960) 104 CLR 186; Crockett v Roberts [2000] TASSC 148; (2000) 9 Tas R 312; Dey v Victorian Railway Commissioners [1948] HCA 1;(1948-49) 78 CLR 62; Ex parte Davis (1901) SR (NSW) 187; Jackson v Sterling Industries Ltd [1987] HCA 23; (1987) 162 CLR 612; Jago v District Court of NSW [1989] HCA 46;(1989) 168 CLR 23; Porter v Le [2010] NSWSC 998; South v Northern Sydney Area Health Service & Anor [2003] NSWSC 479; Steinecke bht Robert John Gardos v Peter Martin Wayne [2011] NSWSC 428; Woolf v Pemberton (1877) 6 Ch D 19; NSW Ministerial Corporation v Abualfoul [1999] FCA 433; (1999) 94 FCR 247; Yakmor v Hamdoush (No 2) [2009] NSWCA 284; (2009) 76 NSWLR 148
• Texts Cited: Dal Pont, Law of Costs, 2nd Ed (2009)
• Category: Procedural and other rulings
• Parties: Arthur Porter (Plaintiff); Phong Le (Defendant) (2007/265150); Western Sydney Local Health District (Defendant) (2011/200099)
• Representation: Counsel: D E Graham SC (Plaintiff); M Windsor SC (Le); S Woods (Western Sydney Local Health District); Solicitors: C O'Dea (Plaintiff); Norton Rose (Le); Crown Solicitor (Western Sydney Local Health District)
• File Number(s): 2007/265150 & 2011/200099
• Publication restriction: Nil

Judgment

1 HIS HONOUR: By separate notices of motion in each proceeding, the respective defendants have sought an order in identical terms that the plaintiff's tutor be removed and that the proceedings be stayed pending the appointment of someone to replace her. The plaintiff's tutor was originally appointed by orders made by me on 8 September 2010: see Porter v Le [2010] NSWSC 998. The Western Sydney Local Health District was not then a party to any proceedings and only became a defendant some time thereafter.

Background

2 Arthur Porter consulted Dr Le, a general practitioner, on 26 July 2004. He presented with coughing, sneezing, rhinorrhoea, pyrexia, a sore throat and purulent post-nasal discharge. Dr Le prescribed Augmentin Duo, an antibiotic, and Panafcort, a corticosteroid, in each case to be taken as one 25mg tablet twice a day. The following day Mr Porter suffered a haemorrhage from the right adrenal gland secondary to septicaemia. He was taken to Westmead Hospital where he was diagnosed with multiple cerebral abscesses, acute renal failure, renal abscesses and bilateral infective emboli of the arteries to his eyes.

3 Mr Porter initially alleged that Dr Le was negligent in prescribing Panafcort, which he contends caused the catastrophic injuries. He subsequently sued the Western Sydney Local Health District in separate proceedings alleging that the hospital failed either appropriately or in a timely way to treat him between his admission on 31 July 2004 and his discharge on 30 August 2004. Mr Porter was transferred to the Lark Ellen nursing home on 3 December 2004 where he remains.

4 Mr Porter's wife was originally appointed as his tutor and commenced the proceedings against Dr Le by statement of claim filed on 26 July 2007. Barbara Mottershead was appointed as Mr Porter's tutor following the removal of Mrs Porter from that role on 8 September 2010 in those original proceedings as earlier described. Ms Mottershead was Mr Porter's tutor when the second proceedings were commenced.

Applicable principles

5 It is not in dispute that Mr Porter has a legal incapacity as contemplated by s 3 of the Civil Liability Act 2005. The expression "person under legal incapacity" includes a person who is incapable of managing his or her affairs: UCPR 7.13.

6 A tutor is appointed to represent a person under a legal incapacity, whether by the court or otherwise, in accordance with UCPR 7.13 - 7.18. A person who is under a legal incapacity may not commence or carry on proceedings except by his or her tutor: UCPR 7.14. The court may appoint a tutor if a party is a person under a legal disability and may remove a party's tutor and appoint another tutor: UCPR 7.18.

7 A tutor is appointed is to ensure that there is a person available to bear the costs of a successful defendant and to protect the person under the disability and the processes of the court: Al Mousawy bht Imelda Margaret Dodds v Howitt-Stevens Constructions Pty Ltd & Ors (No 2) [2010] NSWSC 1398 at [25]; South v Northern Sydney Area Health Service & Anor [2003] NSWSC 479 at [7]; Ex parte Davis (1901) SR (NSW) 187 at 189; Dey v Victorian Railway Commissioners [1948] HCA 1;(1948-49) 78 CLR 62 at 85 and 113.

8 The tutor represents the person under an incapacity and performs on behalf of that person all of the things in relation to the proceedings that the incapacitated person could do if not incapacitated. The person under the incapacity is named on the record but cannot do anything for himself or herself. There is a practical distinction between the tutor and the represented party. The costs liability of the tutor, as an incident of the office, gives legal identity for costs purposes, on the rationale that one of the reasons that a tutor is required is in order that there should be a person answerable for costs. The tutor is to be regarded as a party for costs purposes: Yakmor v Hamdoush (No 2) [2009] NSWCA 284; (2009) 76 NSWLR 148 at [45]; Azar v Kathirgamalingan [2012] NSWCA 429 at [202].

9 The requirement for a tutor is, of course, a matter of substantive law. Brereton J described the rationales behind the requirement for a tutor in Steinecke bht Robert John Gardos v Peter Martin Wayne [2011] NSWSC 428, citing Myers v Nominal Defendant [1966] 1 NSWR 659, at [3] as follows:

"[3] What Myers does make abundantly clear is that the requirement for a tutor issue is more than a mere procedural matter, but a requirement of substantive law imposed because a child or an incapable person is not capable of binding themselves by the institution of proceedings. This is particularly important, to ensure not only that the proceedings and the conduct of litigation is under the conduct of a responsible person, but also to ensure that the parties to the proceedings are bound by the outcome, and to secure a successful defendant's costs. Because of the importance of that rule and its substantive nature, I do not accept that it would be appropriate to dispense with it."

10 Subject to the rules of court, the Court may at any time and from time to time by order stay any proceedings before it, either permanently or until a specified day: s 67 Civil Procedure Act 2005. A court may exercise its inherent power to stay proceedings where there has been an abuse of process: Jago v District Court of NSW [1989] HCA 46; (1989) 168 CLR 23; Clyne v NSW Bar Association [1960] HCA 40; (1960) 104 CLR 186 at 201; Barton v R [1981] HCA 48; (1981) 147 CLR 75 at 96. The court also has an incidental power to control and ensure the proper and fair use of its jurisdiction: Batistatos bht Rosebottom v RTA [2006] HCA 27; (2006) 226 CLR 256 at [121]-[136]. The power may be justified as falling within the court's incidental powers as a necessary adjunct to the effective exercise of its jurisdiction. Every court has a power to prevent a misuse of its procedure: Jackson v Sterling Industries Ltd [1987] HCA 23; (1987) 162 CLR 612 at 623-4. The power extends to the exercise of a power to stay where such an order is necessary to prevent conduct giving rise to injustice: Batistatos.

Consideration

11 In the present case Ms Mottershead is unrelated to Mr Porter whereas Mr Porter's original tutor was his wife. There is no available explicit explanation for choosing Ms Mottershead as the tutor. According to the defendants, there is no evidence that Ms Mottershead is a "substantial person", whatever that means in the present context.

12 As a matter of general principle, a relative is the preferred tutor. In Woolf v Pemberton (1877) 6 Ch D 19 at 23, Jessel MR said this:

"I am the natural guardian of my children; it is for me to consider in what way they should be maintained and educated, and it is for me to judge what is for their benefit both as regards their personal guardianship and the guardianship of their estates; I am the proper person, therefore, to conduct this suit on their behalf."

13 I raised with counsel during the hearing of this application whether or not it was in reality an application for security for costs. Both counsel were disinclined to embrace the suggestion, presumably because it may have appeared to be a somewhat distasteful conclusion with pejorative overtones. However, the authorities support the proposition that the appointment of a tutor is made, at least in part, for the protection of the costs position of litigants such as the current defendants. In Dey, in terms that are now conceptually outmoded and socially offensive, Williams J said this at 113:

"One of the purposes of appointing a next friend is to have a person on the record who is personally liable for costs. But that is not the only purpose for which a next friend is appointed. He is appointed principally to institute and carry on the proceedings on behalf of the infant because the law considers that an infant is incapable of asserting or protecting his rights or forming a judgment as to the necessity of applying for protection or redress to the tribunals of the country. Accordingly, where more than one person is willing to act as a next friend, the court will appoint as most suitable the father or if he is dead the widow or some near relative in preference to a stranger unless the interests of the father or other relative is adverse to that of the infant."

14 The relationship between Mr Porter and Ms Mottershead is slightly unusual in the context of litigation of this type. Ms Mottershead's son lives in a domestic relationship with Mr Porter's son and has done so for approximately seven years. Ms Mottershead is employed and earns a regular income but owns no assets of significant value. The extent to which Ms Mottershead's background, training or experience qualifies or arms her to take or make important decisions affecting Mr Porter's well-being is unspecified. There is on one view no classically principled basis for her appointment as Mr Porter's tutor.

15 I do not consider that the defendants' contention about the importance of a tutor as a fiscal backstop is justified or warranted. They are certainly entitled to be concerned about their exposure to unrecovered costs as a general matter and perhaps even more acutely in proceedings where the outcome is arguably shrouded in considerable uncertainty. For example, the position may be different where the defendants had each admitted liability or where the outcome on an informed analysis suggested that their exposure to an order for unrecoverable costs was remote. Without in any way foreclosing the outcome of these proceedings, it must be observed that there is a significant factual and epidemiological contest evident from what has emerged of the dispute so far. It was a matter that influenced the circumstances that led to my original decision to reject the proposed compromise. However, as Mr Porter points out, there is no authority or rule of court requiring a person who acts, or who seeks appointment, as a tutor for a legally incapacitated person to have attained or acquired some specified minimum level of income or assets before being eligible for the office.

16 In Ex parte Davis at 189, Darley CJ stressed the significance of the responsibility of the tutor for the other side's costs:

"...Hence was seen the necessity of permitting any person to litigate for the infant's benefit who should be disposed to risk the expense.

...

That law has been carried to the present day. In the superior courts there is a well established course of procedure for the purpose of appointing a next friend, who is, when appointed, as is said in the old cases upon the subject, a servant of the Court although liable for the costs of the suit."

17 Ex parte Davis is cited in Dal Pont, Law of Costs, 2nd Ed (2009) at [22.67] in support of the notion that "the next friend is on the record so that there is a person answerable to the opposing party for the costs of the litigation in the event that a costs order is made against the infant."

18 In NSW Ministerial Corporation v Abualfoul [1999] FCA 433; (1999) 94 FCR 247 at 28, Sackville J said:

"One reason for requiring an infant plaintiff to sue by a next friend was so that there would be a person answerable to the defendant for the costs of the litigation, although the defendant could waive this benefit: Daniell's Chancery Practice, p 116; Ex parte Davis...at 189."

19 To a like effect, Underwood J in Crockett v Roberts [2000] TASSC 148; (2000) 9 Tas R 312 at 14 said this:

"Thus it seems to me, that primarily, a next friend is appointed for the benefit of the defendant. A successful defendant is entitled to look to the next friend to satisfy an order for costs which it would not be able to enforce against an infant or person otherwise under disability."

20 Crockett was cited with approval by Burchett AJ in South at 7, and his Honour went on as follows:

"When the person with the power to give, and giving, the instructions in litigation bears no such responsibility for its costs, it seems to me the position of the other party is likely to be inferior to that which the Rules contemplate."

21 Yakmor v Hamdoush at [21] makes it plain that the tutor's liability for costs awarded to the opposite party is an incident of the responsibility of the office of tutor:

"Responsibility for costs is not the only purpose of appointing a next friend; a next friend is appointed principally to bring and conduct proceedings on behalf of a person who, through legal incapacity, cannot do so himself or herself. But on this partial rationale, the next friend should be directly liable to the opposite party for costs ordered in the proceedings."

22 When Ms Mottershead was appointed as Mr Porter's tutor, the issue of her ability to meet or to satisfy any adverse costs order of the sort, and in the way, contemplated by these authorities, was not to my recollection the subject of evidence or argument. The principal concern, in respect of which I proceeded to make some uncontroversial assumptions, was that Ms Mottershead had no interest in the outcome of the proceedings adverse to that of Mr Porter. Any issue about Ms Mottershead's capacity or otherwise to meet an adverse costs order against her had never until now previously been raised for determination by the Court. It has, however, since become the subject of correspondence between the parties.

23 For example, the solicitors for the Western Sydney Local Health District wrote to Mr Porter's solicitors on 22 September 2011, citing much of the authority to which I have already referred in these reasons, and commenting as follows:

"The authorities stress both the central role of a relative and the critical importance of the tutor's role as an officer of the Court intended to protect the costs of the other party to proceedings. In the absence of any evidence that the tutor is a person of substance, the Court should not countenance the tutor as a proper person to fulfil such a role.

...

It would appear that a deliberate decision has been made to commence proceedings by a tutor other than the plaintiff's wife so as to avoid a potential liability for costs.

If this appearance is incorrect, please advise me immediately.

... I advise that if a satisfactory response is not received within fourteen days then I will seek my client's instructions to bring a summary application for the stay or dismissal of the proceedings."

24 On 20 September 2012, Mr Porter's solicitors responded in somewhat glib terms advising simply that "the issue concerning the appointment of Barbara Mottershead as tutor in these proceedings was dealt with by ...Harrison J in his judgment on 8 September 2011."

25 On 12 March 2013, the solicitors for Dr Le wrote to Mr Porter's solicitors in terms that included the following:

"Given the entitlement of the successful defendant to look to the tutor to satisfy an order for costs, our client is entitled to know whether Ms Mottershead is a person able to bear the costs of our client. To this end please provide [details of her assets and liabilities].

Should Ms Mottershead not be in a position to satisfy an order for costs made in favour of our client, we consider that the plaintiff's appointment of an impecunious tutor is a compelling basis for the Court to order that the entirety of our client's costs are recoverable from the original tutor.

Alternatively, our client reserves the right to seek to apportion liability for his costs between Mrs Porter and any other tutor appointed, according to the duration of their respective appointments as the plaintiff's tutor."

26 Shortly thereafter the proceedings came before Hislop J for approval of a settlement on 8 May 2013. Senior counsel for Mr Porter informed Hislop J on that occasion that Ms Mottershead had no assets.

27 On 9 May 2013 the solicitor for Dr Le again wrote to Mr Porter's solicitors, in the following terms:

"We refer to our letter dated 12 March 2013 requesting details of the circumstances of Barbara Mottershead, the tutor for your client, Arthur Porter. This request has gone unanswered by your office.

We note that at the approval hearing part heard on 8 May 2013 before Hislop J in the related proceedings of Mr Porter and Western Sydney Local Health District (proceedings number 2011 of 200099) Mr D Campbell SC advised his Honour that Ms Mottershead, the tutor for the plaintiff in both sets of proceedings, has no assets.

We confirm that this is the first time that we have been informed that Ms Mottershead has no assets in her name.

Plainly, Ms Mottershead is not a person able to bear the costs of our client, should an award be made in Dr Le's favour.

Please respond to our letter dated 12 March 2013 within 14 days. Should we not receive an adequate response within the time stipulated, our client reserves the right to apply to the Court for orders having the effect of precluding Ms Mottershead from continuing as the plaintiff's tutor. Further, we reiterate our client's position that, should Ms Mottershead not be in a position to satisfy an order for costs made in favour of our client, we consider that the plaintiff's appointment of an impecunious tutor is a compelling basis for the Court to order that our client's costs are recoverable from the original tutor.

Given the present circumstances, your client may now approach the NSW Trustee and Guardian to be appointed tutor."

28 The response to that letter was dated 3 June 2013 and was in the same glib terms as the corresponding letter sent to the other defendant's solicitors somewhat earlier.

29 To all of these matters Mr Porter took a strongly opposing view. He contended that a review of all of the circumstances could not support a conclusion that Ms Mottershead was appointed because of her impecuniosity. The Court approved her appointment. Mr Porter submitted that while some of the cases referred to suggest that it is preferable to have a family member as the tutor, and emphasised that the tutor may be personally liable for an adverse costs order, none of the cases establishes that a tutor must have the means to satisfy such an order as a prerequisite to appointment.

30 Costs are always within the discretion of the Court. Mr Porter contended that the defendants' submissions conflated the possibility of any tutor in these proceedings being subject to a costs order with the certainty that it will be so. That error is said to be based upon the contention that the tutor is a party to the litigation.

31 Mr Porter also argued that it is by no means certain that a tutor will be the subject of an adverse costs order if the plaintiff loses. The analogy from cases involving infants, with no capacity to meet costs orders themselves, does not hold good where the tutor is appointed for a disabled adult. The primary purpose of the tutor is to conduct the litigation in the best interests of the legally incapacitated person. Mr Porter perceives that the defendants have inordinately and inappropriately emphasised the security that a substantial tutor may provide for costs at the expense of the paramount role of a tutor as the plaintiff's personal representative and decision-maker.

32 Mr Porter also took issue with the defendants' delay. First, Dr Le did not originally oppose Ms Mottershead's appointment. Secondly, the Western Sydney Local Health District has been aware of her appointment from as soon as it was sued and could then have taken objection to her appointment. Thirdly, no secret was made of the fact that Ms Mottershead was employed as a bank clerk, a matter referred to by her in her 27 August 2010 affidavit sworn for the settlement approval application heard by me. No issue was then taken about her financial position or her apparent lack of financial substance. Fourthly, the defendants' motions were not filed until mid-2013. Fifthly, there is no suggestion that Ms Mottershead's financial position has altered, or that her position now is not as it was when first she was appointed. Finally, in a slightly different context, Mr Porter has continued to conduct the litigation with Ms Mottershead as his tutor and has incurred costs of his own which might have been avoided had these applications been brought in a prompt manner. In all of the circumstances Mr Porter contended that Dr Le has acquiesced "by silence" and "should not now be permitted to change his position." A similar difficulty is said to confront the Western Sydney Local Health District, albeit with a different emphasis and in slightly different terms: its solicitor complained about Ms Mottershead as early as his letter of 22 September 2011, or a little more than three months after the commencement of the proceedings against it.

33 It remains the law in this jurisdiction that an unsuccessful plaintiff can anticipate at least an application for an order against him or her for the payment of a successful defendant's costs in accordance with the rule that, unless the Court otherwise orders, costs should follow the event. That rule is by its terms undoubtedly and obviously subject to the discretion to order otherwise, so that a successful defendant can never be certain, even if confident or hopeful, that a favourable order will be made. Whatever may be the level of expectation in any particular case, it seems to be a reasonable assumption that defendants regularly make important decisions about the conduct and disposition of litigation from time to time in light of the relevant rule and more particularly about whether or not to defend or contest proceedings from time to time. The prospect of a favourable costs order is an important matter calling for evaluation in that context as well as the practical worth of the order if made. An unenforceable costs order is about as useful as no order at all.

34 The burden of the defendants' contentions is that the appointment of a tutor to answer for an adverse costs order on behalf of an unsuccessful plaintiff also means that the tutor should have the demonstrated capacity to satisfy it. However, I do not think that is correct. Whilst that wisdom undoubtedly informs the approach taken by the defendants, its expression necessarily contemplates the unsatisfactory and distasteful spectre of premature and unsupported conclusions about the possible and probable outcome of the proceedings well before they are ready for trial. It cannot be doubted that the ultimate success of Mr Porter's allegations against the defendants is by no means certain, for the legitimate reasons openly identified by senior counsel for the plaintiff and Dr Le as well as experienced counsel for the hospital. Putting the matter as neutrally as I can, it is unlikely that the defendants' interest in Ms Mottershead's ability to satisfy an adverse costs order against Mr Porter would have been similarly agitated if they had admitted liability or they had located some highly vulnerable cross-defendant who was likely to indemnify them.

35 The importance from a defendant's perspective, of there being a so-called substantial tutor to represent a legally incapacitated plaintiff, is arguably thrown into sharper focus in circumstances where the prospect of an adverse costs order against a plaintiff has not been abandoned by the defendants or where such an order does not otherwise appear to be unlikely. In such circumstances the present defendants contend that the rules ought to provide them with the prospect of real, and not just theoretical, protection from the burden of successfully defending the proceedings. Even if such considerations do not gain expression in foundational statements about the role of the tutor, the defendants suggest that they nevertheless provide some particular assistance in the determination of the present applications.

36 I disagree. There is an important distinction to be borne in mind between a tutor's responsibility and liability for the costs of the legally incapacitated person, to which the authorities refer, and the separate issue of the tutor's financial capacity or ability to pay them. A defendant cannot expect to be in a better position against a tutor than it would have been against a plaintiff without funds or assets. The defendants have tacitly acknowledged the unavailability of any basis for an order against Mr Porter's tutor for security for costs. It goes without saying, in the particular circumstances of these cases, that the defendants could not have succeeded upon an application for security for costs based upon the perceived impecuniosity of either Mr Porter or Ms Mottershead. Moreover, nowhere in Yakmor v Hamdoush, or anywhere else for that matter, is there any suggestion that the ability of the tutor to meet a costs order is a relevant consideration or that such ability is in some way to be treated as an incident of the office.

37 There is in my view no basis for the grant of any stay of the proceedings, or for the removal or replacement of Ms Mottershead as Mr Porter's tutor. Ms Mottershead in her capacity as his tutor is undoubtedly answerable for any adverse order for costs that may be made against Mr Porter at any stage of the proceedings. The separate question of whether or not Ms Mottershead is or may ultimately be capable of satisfying such an order is not to the point.

38 I consider that the costs of the defendants' applications should be costs in the proceedings. If any party wishes to argue in favour of a different order for costs, I will hear them at some time convenient to all parties and to the Court to be arranged in consultation with my Associate.

39 Concurrently with the issues concerning the qualifications of Mr Porter's tutor is an almost incandescent contest fomenting about the practical considerations touching and concerning expert witnesses and the organisation of conclaves in their respective competing and overlapping specialties. That contest has itself revealed the scope and content of the medical and factual differences that will require answers. It is clear that the differences are very substantial and that their resolution in conclave and in court will be complicated, difficult and time consuming. I will shortly provide separate written guidance and directions for the parties on this aspect of the proceedings.

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Decision last updated: 21 February 2014