Barrett-Lennard v Reader Lawyers and Mediators - [2017] WASC 146

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: BARRETT-LENNARD -v- READER LAWYERS & MEDIATORS [2017] WASC 146

CORAM: MARTINO J

HEARD: 20 MARCH 2017

DELIVERED : 1 JUNE 2017

FILE NO/S: LPA 12 of 2015

BETWEEN: MELISSA BARRETT-LENNARD
Applicant
AND
READER LAWYERS & MEDIATORS
Respondent

Catchwords:

Costs - Taxation - Review of taxation

Legislation:

Legal Profession Act 2008 (WA)
Rules of the Supreme Court 1971 (WA)

Result:

Application dismissed

Category: B

Representation:

Counsel:

Applicant: In person
Respondent: Mr S V Forbes

Solicitors:

Applicant: In person
Respondent: Stewart Forbes, Barrister & Solicitor

Case(s) referred to in judgment(s):

Soia v Bennett [2014] WASCA 37

MARTINO J: By a chamber summons filed on 29 September 2016 the respondent applies pursuant to O 66 r 55 of the Rules of the Supreme Court 1971 (WA) for review of the decision of the Taxing Officer delivered on 31 August 2016 in relation to the assessment of the respondent's solicitor/client bill of costs, an extension of time to make the application, a declaration that the certificate of taxation issued by the Taxing Officer on 1 September 2016 does not include any costs payable by the applicant in relation to the costs of an appeal under O 60A of the Rules of the Supreme Court which Master Sanderson ordered be paid by the applicant and other consequential orders.

Background to the application for review of the decision of the Taxation Officer

This action was commenced on 8 July 2015. It was an application by the applicant client pursuant to s 295 of the Legal Profession Act 2008 (WA) for assessment of the respondent's bill for legal costs in relation to a matter in the Family Court.
On 6 August 2015 Registrar Whitbread ordered the respondent to file and serve a bill of costs by 28 August 2015, made programming orders and listed the taxation of costs on 19 October 2015.
On 28 August 2015 the respondent filed a bill of costs in accordance with the order of 6 August 2015.
On 19 October 2015 Registrar Whitbread made further programming orders which provided for the filing of affidavits and the deponents being available for cross‑examination on the affidavits and adjourned the taxation of costs to 30 November 2015 and 4 December 2015.
On 23 November 2015 Registrar Whitbread ordered that an affidavit made by the principal of the respondent on 20 November 2015 be sealed until further order and varied the timetable contained in her orders of 19 October 2015. The Registrar did not vary the listing of the taxation of costs on 30 November 2015 and 4 December 2015.
On 24 November 2015 the applicant filed a notice of appeal under O 60A of the Rules of the Supreme Court against the orders of Registrar Whitbread made on 23 November 2015. By that notice of appeal the applicant sought, amongst other orders, orders staying the orders of Registrar Whitbread made on 23 November 2015 and vacating the listing of the taxation of costs on 30 November 2015 and 4 December 2015.
That appeal was before Master Sanderson on 26 November 2015. The Master gave oral reasons why he would not order a stay of the taxation and said that the effect of his orders was that the appeal remained on foot. The Associate's Record of the Master’s orders is:
1.Oral reasons.
2.Master said it is arguable the Registrar was acting as a taxing officer; this is effectively a stay application; not appropriate to grant a stay and therefore dismiss the stay application and that leaves the Appeal on foot.
3.Costs of this application be costs in the Appeal.
On 27 November 2015 the applicant discontinued the appeal which she had commenced on 24 November 2015.
On 30 November 2015 Registrar Whitbread adjourned the taxation of the bill of costs to 21 and 22 March 2016 and referred it to mediation.
Until 3 March 2016 the applicant had been represented in this action by a legal practitioner. On 3 March 2016 she filed a notice that she was acting in person. She has acted in person since that date.
On 8 March 2016 the parties appeared before Master Sanderson on an application by the respondent for an order for costs of the appeal that the applicant had commenced on 24 November 2015. Master Sanderson gave directions for the filing of submissions which provided for him to make orders on the papers. On 18 March 2016 Master Sanderson made the following order:
1.The applicant pay the costs of the appeal, including reserved costs.
On 22 March 2016 Registrar Whitbread as Taxing Officer on the taxation of the respondent's costs the subject of the applicant's application for assessment allowed those costs in the sum of $142,739.09. The Registrar made the following orders:
1.On the taxation the Taxing Officer allows the bill in the sum of $142,739.09.
2.Any party who contends that the Taxing Officer has made an error in principle in allowing or disallowing any item or part of the bill of costs may file and serve written objections ('the Objections') (in a short and concise form clearly setting out the grounds and reasons for the objections) by 12 April 2016.
3.The non-applying party to reply in writing to the Objections by 26 April 2016 ('the Reply').
4.The Taxing Officer will conduct a review of the taxation, based on the Objections and the Reply, on the papers unless the parties are requested by the Taxing Officer to attend a hearing.
5.The Client/Solicitor to file written submission on the costs of the taxation by 12 April 2016. The Client/Solicitor to file written submissions in reply by 26 April 2016. The Costs of the taxation will be determined on the papers unless either of the parties establish a basis as to why a hearing is required in their costs submissions.
On 4 April 2016 the respondent filed a bill of costs, described as a party/party bill of costs for taxation pursuant to the orders of Master Sanderson made on 18 March 2016. The Master's order of 18 March 2016 was the order that the applicant pay the costs of the appeal. The costs claimed in that bill of costs were $6,770.50 plus a filing fee of $352.00, a total of $7,122.50. The costs of $6,770.50 were made up of $5,120.50 for the appeal, $473.00 for conferral in relation to the costs of the appeal after discontinuance, $231.00 for settling and extracting the order for costs, $473.00 for drawing the bill of costs and service and $473.00 for taxation of costs including preparation for that taxation.
On 8 April 2016 the respondent filed a notice of objection pursuant to O 66 r 53(1), objecting to the disallowance by the Taxing Officer of Item 768 in the respondent's bill of costs dated 28 August 2015. Item 768 was the lodgement fee of $352 paid when the bill of costs was lodged on 28 August 2015.
Also on 8 April 2016 the respondent filed submissions in relation to the costs of the taxation. Paragraph 1 of the submissions was in the following terms:
1.The Respondent seeks an order that the Applicant pay the costs of the taxation, including all reserved costs, on a party/party basis until 2 December 2015 and on an indemnity basis thereafter.
The following paragraphs of the submissions provided detailed submissions as to why the costs order sought in par 1 of the submissions should be made. The submissions did not provide any information or submissions as to the amount of the costs of the taxation that should be allowed.
On 14 April 2016 the applicant filed a document dated 12 April 2016 described as 'Notice of Submission filed pursuant to the orders of Registrar Whitbread dated 25 March 2016'. That document appears to be intended by the applicant to be a notice of objection to the taxation. That is what it was taken to be by Registrar Whitbread.
On 2 August 2016 Registrar Whitbread's Associate sent an email to the respondent's solicitor with a copy to the applicant in the following terms:
Dear Mr Forbes,
The Registrar has asked that I write to you in the following terms.
If costs were awarded in accordance with paragraph 1 of your submissions of 8 April 2016 then what would be the total costs and total disbursements (as separate figures) claimed by the solicitor.
On 10 August 2016 the respondent's solicitor replied by letter to the email from the Associate to Registrar Whitbread of 2 August 2016 in the following terms:
If costs were awarded in accordance with paragraph 1 of my submissions dated 8 April 2016 then the total costs claimed by the solicitor would be as follows:
a.Total disbursements (excluding the bill of costs lodgement fee): $115.00 (being $105.00 paid to AAC and $10.00 conduct money);
b.Total costs: $51,079.05 made up as follows:
i.party/party costs until 1 December 2015: $18,892.50;
ii.indemnity costs after 1 December 2015: $32,186.55 (including an amount of $14,190.00 for 30 hours spent by Ms R Reader at $473.00 per hour and 18 hours at $330.00 per hour for time spent by Ms Milton). The costs of Ms Reader and Ms Milton are claimed in accordance with the decision of the Court of Appeal in Soia v Bennett [2014] WASCA 27.
c.The party/party costs do not include any claim for time spent by Ms Reader and Ms Milton.
On 31 August 2016 Registrar Whitbread published her reasons for decision on the review of the taxation. Those reasons do not have a citation number.
In those reasons the Registrar allowed the solicitor's objection to the disallowance of Item 768 in the respondent's bill of costs - [6].
The Registrar found that no error of principle was raised in the applicant's notice of objection dated 12 April 2016 - [10].
The Registrar fixed the costs of the taxation at $30,000 including disbursements - [16].
The Registrar allowed $143,091.09 on the review of the bill and costs of $30,000 on the taxation of costs - [17].
On 1 September 2016 the solicitor for the respondent sent an email to the Associate to Registrar Whitbread to which was attached a form of certificate of taxation in the sum of $67,591.09. In his email the solicitor wrote:
The amount of $67,591.09 is calculated as follows:
a.amount of the bill allowed upon taxation:           $143,091.09
b.costs of taxation allowed:  $30,000.00
SUBTOTAL$173,091.09
c.less amount paid by the client:  $105,500.00
UNPAID BALANCE  $67,591.09
Registrar Whitbread signed that certificate on 1 September 2016.
On 12 September 2016 the solicitor for the respondent sent an email to the Associate to Registrar Whitbread, with a copy to the applicant, enquiring about the bill of costs filed on 4 April 2016. The email was in the following terms:
On 4 April 2016, the Respondent's party/party bill of costs for taxation pursuant to the orders of Master Sanderson made 18 March 2016 was filed.
My recollection is that the Registrar indicated that she would conduct a provisional assessment in relation to that bill.
Could you kindly advise when the provisional assessment is likely to be completed and provided to the parties.
On 21 September 2016 the Associate to Registrar Whitbread sent an email to the solicitor for the respondent and to the applicant. The first part of the email corrected a slip in the Registrar's reasons for decision of 31 August 2016. The second part of the email responded to the email from the solicitor for the respondent dated 12 September 2016. That response was:
Also, the Registrar has instructed me to respond to your query below in the following terms.
The Costs ordered payable on the taxation (at paragraph 16 of the review) are deemed to include all costs applicable to the matter, including the costs order made by the Master on 18 March 2016.’
On 29 September 2016 the respondent filed the chamber summons for review of the taxation which is before me.
On 18 October 2016 the Associate to Registrar Whitbread wrote to the solicitor for the respondent in the following terms:
The Registrar has instructed me to write to you in the following terms.
I refer to the Chamber Summons filed by the Solicitor in the above referred matter on 29 September 2016.
On 2 August 2016 the Court wrote to the respondent and asked what the quantum of costs sought by the respondent would be if costs were awarded in accordance with paragraph 1 of the respondent's submissions dated 8 April 2016. This means that you were asked to advise as to the total costs the respondent would claim if the applicant were ordered to pay costs of the taxation, including all reserved costs, on a party/party basis until 2 December 2015 and on an indemnity basis thereafter.
On 10 August you wrote to the Court advising as to such costs. There was no qualification that such costs did not include the order for costs made by the Master on 18 March 2016 ('the Master's Costs Order') on the applicant's appeal, to the Master, of the Registrar's refusal of the applicant's application to adjourn the taxation. There was no separate file created for that appeal; it forms part of the taxation file.
It is clear, both from the Court file and the Registrar's knowledge of this matter, as to both why the Master's Costs Order was made and in what circumstances. The appearance times are noted and the reasonable legal expenses which would have been incurred are equally clear. When the Registrar considered the total amount of costs payable to the respondent on the taxation she took the Master's Costs Order into account in assessing the amount of costs payable; and included allowance for that matter.
Since the costs allowance made on the taxation includes an assessment of the costs recoverable under the Masters Costs Order; a review, even if appropriate, would therefore not result in any change to the total costs awarded to the respondent.
If the respondent is aggrieved by the Registrar's determination on the taxation; and/or the total costs determined as payable thereon by the applicant, then the respondent should appeal the Registrar's decision.
Accordingly, the Chamber Summons will not be listed for hearing and is dismissed with no order as to costs.
On 26 October 2016 the respondent appealed pursuant to O 60A against the Registrar's orders of 18 October 2016 dismissing the summons with no order as to costs. On 15 December 2016 Master Sanderson set aside the orders of Registrar Whitbread made on 18 October 2016, referred the summons filed on 29 September 2016 to a Judge and reserved the costs of the appeal to the judge hearing the review of the taxation application.

The Registrar's reasons on the allowance of costs of the taxation

In her reasons for decision dated 31 August 2016 Registrar Whitbread dealt with the costs of the taxation at [11] ‑ [16]. The Registrar said that the dispute between the parties in the taxation, in essence, was approximately $36,000 and that on the taxation $7,233.32 was disallowed. The Registrar said that the amount of hearing time involved in the matter was disproportionate to the dispute and that both parties must shoulder some of the blame for the protracted nature of the taxation and the associated disproportionate amount of time which was spent on it.
The Registrar said that principles of proportionality applied to the issue of costs of the taxation. The Registrar accepted the respondent's submission that costs follow the event and that the respondent was entitled to an order for costs.
The Registrar said that a Calderbank offer was made by the respondent on 2 December 2015 and that as the offer was not accepted the respondent sought indemnity costs. The Registrar said that she did not intend to prolong the litigation further by making a general form of order of the kind sought by the respondent as to do so would result in another round of, no doubt expensive, taxation assessment. The Registrar then quoted at length the respondent's submissions of 8 April 2016 as to why the costs order sought by the respondent should be made.
The Registrar then said that she had asked the respondent to advise her of the amount of costs which would be claimed if an order were made in terms of par 1 of the submissions of 8 April 2016 and that she had been advised that costs of $51,079.05 would be claimed, which included an amount of $14,190 for 30 hours spent by Ms Reader at $473 per hour and 18 hours at $330 per hour by Ms Milton. The Registrar noted that those costs were claimed pursuant to the decision in Soia v Bennett [2014] WASCA 37.
The Registrar said that the amount of costs which would be claimed if the order sought by the respondent were made was grossly disproportionate to the amount in issue of approximately $36,000. The Registrar said that the respondent approached the matter in what might be described as an 'overzealous' fashion and that the amount of work done by the respondent was wholly disproportionate to the quantum of the bill in issue.
The Registrar said that given that costs were ultimately at her discretion the principle of proportionality must apply. In the Registrar's view the costs awarded to the Respondent must not exceed the amount in dispute in the matter. Having regard to all issues in the taxation, the Calderbank offer and the conduct of both parties on the taxation the Registrar fixed 'the fair and reasonable amount for costs, payable by the Client to the Solicitor on the taxation, in the sum of $30,000 (including disbursements)'.

The basis of the application for review

The application for review is made under O 66 r 55 which provides that if the judge hearing an application for review of taxation is of the opinion that the taxing officer has made an error of principle the judge may make such order to rectify the error as the judge thinks just.
It is apparent from the Registrar's reasons that the Registrar took a broad approach to the costs of the costs assessment. No complaint is made about that by the respondent.
In the submissions in support of the application for review the solicitor for the respondent submitted that the party/party bill of costs in relation to the appeal was not before the Taxing Officer during the assessment of the solicitor/client costs and was not addressed by the parties in the assessment of costs or the review of taxation. The solicitor for the respondent submitted that the parties have been denied natural justice in that no party has had the opportunity to address the reasonableness of the costs claimed in the bill filed on 4 April 2016, that the Taxing Officer erred in principle in regarding the costs of an interlocutory appeal arising out of the taxation process as being part of the costs of the taxation, and that the Taxing Officer erred in principle in treating the costs of the appeal as being deemed to be part of the costs of taxation when there is no basis for costs to be so deemed.

Whether the costs of the appeal commenced on 24 November 2015 were part of the costs of the costs assessment

This action was commenced on 8 July 2015 by the applicant's application for assessment of costs pursuant to s 295 of the Legal Profession Act. Section 295 is in div 8 of the Legal Profession Act. Division 8 deals with costs assessments. Section 295(2) provides that a client may apply to a taxing officer for an assessment of the whole or part of any part of a bill for legal costs. Section 304(1) provides that the taxing officer must determine the costs of a costs assessment.
The appeal commenced on 24 November 2015 was an appeal under O 60A r 4 of the Rules of the Supreme Court against the orders of Registrar Whitbread made on 23 November 2015. If the orders of 23 November 2015 had been made by the Registrar as Taxing Officer then, by reason of O 60A r 4(3)(c) there was no right of appeal under O 60A r 4.
Whether the appeal was validly commenced under O 60A r 4 was not determined, because the appeal was discontinued on 27 November 2015 after the hearing before Master Sanderson on 26 November 2015. It is not necessary for me to decide whether the appeal was validly commenced under O 60A r 4, because whether or not the appeal was a valid appeal the costs of the appeal are part of the costs of the costs assessment. If the appeal was a purported appeal against the decision of the Registrar as taxing officer then it was part of the costs of the assessment of costs by the taxing officer. If the appeal was an appeal under O 60A r 4 against a case management order of the Registrar then O 60A r 5(2) required the appeal to be commenced and to proceed on the file in which the order was made, which is what occurred. In either case the appeal was part of the assessment of costs under s 295 of the Legal Profession Act. As the appeal was part of the assessment of costs the costs of the appeal were part of the costs of the costs assessment.

Whether the certificate of taxation includes any allowance for costs of the appeal commenced on 24 November 2015

The respondent submits that the costs of the costs assessment allowed by the Taxing Officer do not include any allowance for the costs of the appeal under O 60A which was commenced on 24 November 2015. As I have noted in the email of 21 September 2016 and the letter of 18 October 2016 the Associate to Registrar Whitbread said that the Associate had been instructed by the Registrar to say that the costs allowed on the taxation included the costs of the appeal ordered to be paid by the Master on 18 March 2016. The respondent submits that this is not correct and that the reasons of the Registrar make no reference to the costs of the appeal.
However because the approach of the Registrar to the costs of the costs assessment was a broad one the fact that the costs of the appeal were not specifically referred to in the reasons does not mean that they were not included by her in the costs allowed. The reasons do not refer to any specific aspect of the costs, but rather refer to the total costs being proportionate. As I have said there is no complaint made about that approach.
For reasons that I have expressed it is my view that the costs of the appeal are part of the costs of the costs assessment. I do not see anything in the reasons of the Registrar to indicate that she took a different view. I conclude that the costs of the appeal were part of the costs of the costs assessment which were allowed as costs of the taxation by the Registrar.

Whether the parties were denied natural justice

By the fifth of her case management orders made on 22 March 2016 Registrar Whitbread directed the parties to file written submission on the costs of the taxation. The respondent filed written submissions on 8 April 2016.
By her Associate's email dated 2 August 2016 the Registrar requested information as to the claim for the costs of the taxation. On 10 August 2016 the respondent's solicitor replied by letter to the email from the Associate to Registrar Whitbread of 2 August 2016, providing their claim for costs.
It may be that the respondent s solicitors did not appreciate that the costs of the appeal were part of the costs of the costs assessment. If so they were mistaken. However it does not follow that the Registrar denied the parties natural justice. The Registrar enabled the parties to make submissions on the claim for costs of the costs assessment. In doing so the Registrar afforded them natural justice.

Disposal of the application for review

It follows from my reasons that I have concluded that there was no error of principle by the Registrar as taxing officer. On the three matters raised by the respondent in the submissions in support of the application for review my conclusions are:
1.the parties were afforded natural justice by the Registrar enabling them to make written submissions and further detail by letter as to the costs of the costs assessment;
2.there was no error of principle in the Registrar regarding the costs of the interlocutory appeal as being part of the costs of the costs assessment; and
3.there was a proper basis for the Registrar to include the costs of the appeal as part of the costs of the costs assessment and the Registrar was correct in doing so.
The extension of time that the respondent seeks to make the application for review is not great and I would grant the extension requested. However for the reasons I have given the application for review will be dismissed.