Bell Lawyers Pty Ltd v Pentelow

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HIGH COURT OF AUSTRALIA

KIEFEL CJ,
BELL, GAGELER, KEANE, NETTLE, GORDON AND EDELMAN JJ

BELL LAWYERS PTY LTD  APPELLANT

AND

JANET PENTELOW & ANOR  RESPONDENTS

Bell Lawyers Pty Ltd v Pentelow

[2019] HCA 29

4 September 2019

S352/2018

ORDER

1.Appeal allowed.

2.Set aside orders 1 to 4 of the Court of Appeal of the Supreme Court of New South Wales made on 13 July 2018 and, in their place, order that:

(a)the summons for judicial review be dismissed; and

(b)the first respondent (Ms Pentelow) pay the costs of the appellant (Bell Lawyers Pty Ltd) in the District Court of New South Wales and the Court of Appeal of the Supreme Court of New South Wales.

3.The first respondent pay the appellant's costs of the appeal to this Court.

On appeal from the Supreme Court of New South Wales

Representation

B W Walker SC with M Castle for the appellant (instructed by Bell Lawyers)

G O'L Reynolds SC with D P Hume for the first respondent (instructed by Castagnet Lawyers)

Submitting appearance for the second respondent

Notice:  This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.

Practice and procedure – Costs – Legal practitioners – Barristers – Where self‑represented litigant may not obtain any recompense for value of his or her time spent in litigation – Where exception commonly referred to as "Chorley exception" exists for a self-represented litigant who is a solicitor – Where first respondent is a barrister – Where first respondent undertook legal work in litigation in which she was represented – Where first respondent incurred costs on her own behalf and for legal services provided by herself – Whether Chorley exception operates to benefit barristers – Whether Chorley exception recognised as part of common law of Australia.

Words and phrases – "anomalous", "Chorley exception", "common law of Australia", "costs", "costs payable", "creature of statute", "employed solicitors", "equality before the law", "exception to the general rule", "exercise of professional skill", "incorporated legal practice", "indemnity", "judicial abolition", "professional legal services", "prospective overruling", "remuneration", "rule of practice", "rules committees", "self-represented litigants", "statutory power".

Civil Procedure Act 2005 (NSW), ss 3(1), 98(1).

  1. KIEFEL CJ, BELL, KEANE AND GORDON JJ.   As a general rule, a self‑represented litigant may not obtain any recompense for the value of his or her time spent in litigation[1].  Under an exception to the general rule, a self‑represented litigant who happens to be a solicitor may recover his or her professional costs of acting in the litigation.  This exception is commonly referred to as "the Chorley exception", having been authoritatively established as a "rule of practice" by the Court of Appeal of England and Wales in London Scottish Benefit Society v Chorley[2]. 

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Details
Case
[2019] HCA 29
Decision Date

CaseChat Overview and Summary

The High Court of Australia considered an appeal by Bell Lawyers Pty Ltd against a decision concerning costs awarded to the first respondent, Ms Pentelow, a barrister who had acted for herself in litigation. The central dispute revolved around whether Ms Pentelow, as a self-represented litigant who was a legal practitioner, could recover costs for the professional time she spent on her own case.

The legal issues before the Court were whether the exception to the general rule that self-represented litigants cannot recover costs for their own time, commonly known as the "Chorley exception," extends to barristers, and whether this exception is recognised as part of the common law of Australia. The Court was required to determine the historical basis and current applicability of the Chorley exception in the Australian legal context.

The Court reasoned that costs are fundamentally creatures of statute, with the principles governing their award developed by courts over time. The general principle of costs being awarded by way of indemnity for professional legal costs incurred is a judicial creation. The Chorley exception, which allows a legal practitioner to be indemnified at a professional rate for time spent acting on their own behalf, was introduced into the common law system by English courts at a time when Australian courts were bound to follow English Court of Appeal decisions on materially identical statutes. However, following the termination of appeals to the Privy Council, Australian courts are no longer bound by such decisions. The Court concluded that there was no compelling reason to continue to recognise the Chorley exception as part of the common law of Australia, particularly as it applied to barristers.

The appeal was allowed, and the orders of the Court of Appeal of the Supreme Court of New South Wales were set aside. In their place, the summons for judicial review was dismissed, and Ms Pentelow was ordered to pay Bell Lawyers Pty Ltd's costs in the District Court, the Court of Appeal, and the High Court.

Orders

Orders of the court

1. Appeal allowed.

2. Set aside orders 1 to 4 of the Court of Appeal of the Supreme Court of New South Wales made on 13 July 2018 and, in their place, order that:

(a) the summons for judicial review be dismissed; and

(b) the first respondent (Ms Pentelow) pay the costs of the appellant (Bell Lawyers Pty Ltd) in the District Court of New South Wales and the Court of Appeal of the Supreme Court of New South Wales.

3. The first respondent pay the appellant's costs of the appeal to this Court.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

KIEFEL CJ, BELL, KEANE AND GORDON JJ (dissent) GAGELER J NETTLE J (dissent)
Dawson, Toohey and Gaudron JJ expressly agreed with these observations[68].[68]Ha v New South Wales (1997) 189 CLR 465 at 515.Conclusion and orders There is no compelling reason for this Court to refrain from taking the "logical step" identified in Cachia. The Chorley exception is not part of the common law of Australia. The appeal should be allowed. Orders 1 to 4 of the Court of Appeal of the Supreme Court of New South Wales should be set aside. In their place it should be ordered that the summons for judicial review be dismissed and the first respondent pay the appellant's costs in the District Court and the Court of Appeal. The first respondent should pay the appellant's costs of the appeal to this Court. Costs in courts administering the common law are and always have been "entirely and absolutely creatures of statute"[69]. Yet statutes authorising courts to award costs have formed part of the armoury of common law courts for almost as long as the common law system has existed[70]. Throughout much of the history of the common law system, the principles according to which statutory authority to award costs has been exercised have been left to exposition and development by the courts themselves. The courts have articulated those principles at times legislatively through the promulgation of rules of court and at times judicially through reasoned decisions which have the status of precedents. [69]Knight v FP Special Assets Ltd (1992) 174 CLR 178 at 182; [1992] HCA 28, quoting Garnett v Bradley (1878) 3 App Cas 944 at 962.[70]Statute of Gloucester 1278 (6 Edw I c 1); An Act that the Defendant shall recover Costs against the Plaintiff, if the Plaintiff be nonsuited, or if the verdict pass against him 1531 (23 Hen VIII c 15); An Act to give Costs to the Defendant upon a Nonsuit of the Plaintiff, or upon a Verdict against him 1606 (4 Jac I c 3). The "general principle" that "costs are awarded by way of indemnity (or, more accurately, partial indemnity) for professional legal costs actually incurred in the conduct of litigation" is a judicial creation of considerable antiquity[71]. A comparatively recent judicial creation until now has been the "Chorley exception", according to which a legal practitioner has been able to be indemnified at a professional rate for time spent acting on his or her own behalf. [71]Cachia v Hanes (1994) 179 CLR 403 at 410-412; [1994] HCA 14, citing Coke, Second part of the Institutes of the Laws of England (1797) at 288, Howes v Barber (1852) 18 QB 588 at 592 [118 ER 222 at 224] and Dowdell v Australian Royal Mail Steam Navigation Co (1854) 3 El & Bl 902 at 906 [118 ER 1379 at 1381]. See also Harold v Smith (1860) 5 H & N 381 at 385 [157 ER 1229 at 1231]. The Chorley exception was authoritatively introduced into the common law system by a decision of the English Court of Appeal[72] at a time when it had been laid down by the Privy Council to have been "of the utmost importance that in all parts of the empire where English law prevails, the interpretation of that law by the Courts should be as nearly as possible the same" with the consequence that colonial courts construing and applying colonial statutes were bound to follow decisions of the English Court of Appeal on the construction and application of English statutes in materially identical terms[73]. The last vestiges of the policy laid down in that era were removed only with the termination of appeals to the Privy Council from all decisions of Australian courts in 1986[74], immediately following which this Court declared that earlier statements to the effect that decisions of the English Court of Appeal (including those on the construction and application of statutes) ought generally to be followed[75] "should no longer be seen as binding upon Australian courts"[76].[72]London Scottish Benefit Society v Chorley (1884) 13 QBD 872, affirming London Scottish Benefit Society v Chorley (1884) 12 QBD 452. [73]Trimble v Hill (1879) 5 App Cas 342 at 344-345.[74]Section 11 of the Australia Act 1986 (Cth).[75]eg, Public Transport Commission (NSW) v J Murray-More (NSW) Pty Ltd (1975) 132 CLR 336 at 341, 349; [1975] HCA 28.[76]Cook v Cook (1986) 162 CLR 376 at 390; [1986] HCA 73.

Ratio Decidendi

Legal Principle Established

Established by: GAGELER J,

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