Joshua Michaels argues in favour of pre-action protocols that encourage early negotiation and discourage clients being mired in costly litigation.
You could call a bluff, offer a reply on your own accord, suggest mediation if it was warranted, or elect to hold instructions to accept service of a claim (no matter how meritorious), or fold – or not. There was no real obligation for solicitors to attempt to co-operate.
On paper at least, UCR 61.71 requires much more of us. And rightly so. It means applicants must serve a pre-action claim notice that sets out in detail the basis for the claim, proposed course of action and a settlement offer.
It is easy to focus on the law and become entrenched in the rules. So much so, that I think it might be often lost on litigators how intense the effect of litigation might well be for the lay client; being embroiled in lengthy, costly court disputes where one’s livelihood is at stake – I can’t imagine it is much fun at all (I say imagine because I have been lucky enough to have so far escaped the requirement to be embroiled in disputation before the courts).
The new rules2 have an appropriate purpose – to encourage negotiation and avoid unnecessary costs and delays. And I think they have a rightful place.
Compliance with the rules, however, can only be taken as seriously as the sanctions imposed by the courts for want of compliance (and indeed the court’s own compliance with the rules as it turns out). And therefore, should we care?
It makes sense to clearly articulate claims, defences thereto, and then attempt a kumbaya session with those opposite. It works – sometimes.
A novel and now common fad/mistake (to the point of boredom) is to decree upon receipt of a valid pre-action claim unapologetic complaints that the said pre-action claim is non-compliant for a lack of particularity and thus rendering said solicitor “unable to provide a pre-action response”. Please stop that – it is unhelpful.
A lawyer ought not be expected to provide opening and closing submissions at first instance and a final tender book of evidence. The rules adequately set out the requirements. But where do we draw the line? What defines proper particularity? This has not yet been tested – probably a good thing in my mind given the purpose and over-arching principles of the pre-action rules regime and in light of the onus of the applicant to tick the box declaring their own homework properly compliant on commencing proceedings.
One problem with pre-emptive pre-action sessions, however, is that the punters all too often have no or little skin in the game. Costs are ordinarily low, parties often consider that it might be a special occasion to air every single last conceivable grievance, and a lot gets lost in the wash. In low-cost scenarios, it’s difficult to convincingly advise on compromise. Why? Because everyone wants everything, emotions are real (shock!), and there are no cost consequences for being unreasonable. In high-cost scenarios, it is almost always impossible, but achievable in the right circumstances.
Rule 61.7 attempts to modify our behaviour by imposing sanctions on those who dare to rebel. In my (limited) experience, however, not one single special directions3 hearing has been called on for want of compliance with the rules (boxes ticked or otherwise). This is problematic. If the rules are to be taken seriously, I think we deserve equally appropriate resistance from the gatekeepers of the Court in allowing matters to proceed without due regard for the consequences of non-compliance. The rules are expressed in mandatory terms. The word ‘must’ should have some thrust, though experience tells us that even mandatory expressions with respect to compliance can go to the wayside.
Thankfully, we have some guidance.
To my knowledge, two Masters’ decisions have been published as at the time of my writing. I am not aware that any appeal has followed. Hayes-Solden4 deals with a personal injury claim instituted without compliance with r 61.7, i.e., no pre-action claim was served, no pre-action response was served, and no pre-action meeting occurred – that position was uncontroversial. The respondent sought an early directions hearing (there being no endorsement by the solicitor on the claim as required by UCR 61.13(3)), and subsequently applied for compliance with the rules. No formal application for dispensation with compliance was sought by the applicant. The application for compliance was argued. An oral application was made and quickly abandoned for dispensation with compliance with UCR 61.7 by the applicant once the Court foreshadowed a personal cost order against the solicitor occasioned by the likely adjournment of the argument if the oral application was pressed. Much criticism was directed at the solicitor in their application of the rules: “The failure to comply with UCR 61.13(3) is disappointing. This is a requirement falling squarely on the legal practitioner”.
The applicant in this matter argued that the matter was urgent, thus negating any requirement for compliance with the rules. That didn’t fly.5
The result? Costs payable to the respondent thrown away forthwith on an indemnity basis of (a) the application for the early directions hearing occasioned by the non-compliance with the pre-action protocols (b) the early directions hearing (c) the application for compliance and (d) the argument. In my view, that ought to be a sufficiently bad enough Order to dissuade even the most notorious rule-breaker.
The factual matrix in Turnbull6 was much more complex: those matters do not require examination. After much ‘debate’ about particulars and the like, competing applications were made retrospectively for compliance with the pre-action protocols on the one hand and dispensation with the requirements on the other. It was common ground that:
- while the applicants did engage with the first respondent before proceedings commenced, that engagement did not amount to a fully complying pre-action notice;
- While the applicants did engage with the second respondent after commencement of the action (but before service of the second respondent) the second respondent was never served with a pre-action notice; and
- there was no pre-action meeting.
The relevant boxes within the body of the claim certifying compliance were (again) left blank. The Court should have convened a special directions hearing. It did not. Why? Who knows. What we do know is that the Court failed to comply with the rules7, which is not ideal at the best of times.
The result? The applicants were not entitled to recover the costs of preparing, filing or serving the claim. Had the Court complied with the rules and a special directions hearing been listed, the first respondent would have been entitled to the costs of it (the need for the special directions hearing being solely attributable to the applicants’ breach of the pre-action protocols). As so much interlocutory banter had been played out, heard, and determined prior to this, various hearings were therefore treated retrospectively as “special directions hearings” and thus 50% of the costs of the second of those hearings was to be paid by the applicants to the first respondent (the second respondent not having engaged) on account of non-compliance.
I guess that at least in this respect, the failure of the respondents to act upon the non-compliance at an earlier date (together with the Court’s own non-compliance) sufficiently muddied the water so as to dilute the indemnity costs-consequences of the non-complying behaviour of the applicants. I dare say though that in this regard, by the time the costs aspects of this particular case are properly addressed (if ever), these matters will have been largely forgotten and will no doubt pale into insignificance.
It begs the question: who knows what might have unfolded if the parties were, at an earlier date, required to comply with the pre-action protocols had a special directions hearing had been automatically and appropriately listed (rather than being addressed some 25 or so FDNs later).
There is one important rule that has been not addressed by these decisions (this is not a criticism) but one which I submit warrants more attention. Rule 61.12(5)(f) encourages the parties to a pre-action meeting to turn their minds to what happens if the parties cannot settle. Specifically: (i) if expert evidence is likely to be required—how the relevant issues are to be defined and how expert evidence is to be dealt with including whether a joint expert might be appointed and, if so, who that should be; (ii) the extent of discovery of documents with a view to saving costs; and (iii) the conduct of the litigation with the aim of minimising cost and delay.
The conduct of the litigation means: from the institution of the claim, to trial. That process is often a huge unknown to the lay client. Understanding the consequences of the inability to compromise a dispute and the enormous and costly process that is to follow, must (or at least ought to) have a role to play in the ultimate decision-maker’s mind. With those steps having been addressed in front of clients, it is not uncommon for parties to re-think their final positions. And so they should.
At the very least, this rule provides our clients with a great deal of frankness and assists very helpfully in the execution and discharge of our ever-onerous obligations to provide advice on “next steps” and costs. Clients are, after all, the reason we all exist and those whom we serve. But we can’t get to that point unless or until we comply with the pre-action protocols.
So, in answer to the question posed by the title of this article, I think we can safely say, “…probably, yes,” and at least alternatively, “definitely yes, for the benefit of our clients”.
Joshua Michaels is the Managing Director of NDA Law.
1 Rule 61.7 of the Uniform Civil Rules, 2020
2 Specifically, Divisions 1 – 3 of Part 1 of Chapter 7 of the Uniform Civil Rules, 2020
3 Rule 61.14 of the Uniform Civil Rules, 2020
4 Hayes-Soldan v Hosking (Unreported, District Court of South Australia, Master Blumberg, 15 September 2022).
5 Ibid at 
6Turnbull & Anor v Ramsey Bros Pty Ltd & Anor (Unreported, District Court of South Australia, Auxiliary Master Roder, 5 December 2022).
7 Ibid at