Browne v Browne [No 2] - [2017] WASC 375 (S)

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   BROWNE -v- BROWNE [No 2] [2017] WASC 375 (S)
CORAM:   SMITH AJ
HEARD:   ON THE PAPERS
DELIVERED:   11 APRIL 2018
FILE NO/S:   CIV 2044 of 2017
BETWEEN:   STEVEN EDWARD BROWNE
Plaintiff
AND
EDWARD BROWNE
Defendant

Catchwords:

Practice and procedure - Application for indemnity costs - Calderbank offer - Not unreasonable to refuse offer - Claim for special costs orders - Legal Profession Act 2008 (WA) - Whether scale limit should be removed for particular items - No new principles - Turns on own facts

Legislation:

Legal Profession (Supreme Court) (Contentious Business) Determination 2016 (WA), items 1(c), 7(b), 17, 20(a), 20(b), 20(d)
Legal Profession Act 2008 (WA), s 280(2)

Result:

Special costs order made

Category: B

Representation:

Counsel:

Plaintiff	:	No appearance
Defendant	:	No appearance

Solicitors:

Plaintiff	:	Hotchkin Hanly Lawyers
Defendant	:	Dwyer Durack

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

Browne v Browne [No 2] [2017] WASC 375
Calderbank v Calderbank [1975] 3 All ER 333
Cape Lambert Resources Ltd v MCC Australia Sanjin Mining Pty Ltd [2013] WASCA 66 (S)
Eccles v Koolan Iron Ore Pty Ltd [2013] WASC 418 (S)
Eclipse Resources Pty Ltd v The State of Western Australia [No 2] [2015] WASC 137
Electricity Generation and Retail Corporation Trading as Synergy v Woodside Energy Ltd [2014] WASC 469 (S)
Ford Motor Company of Australia Ltd v Lo Presti [2009] WASCA 115
Heartlink Ltd v Jones As Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254 (S)
McKay v Commissioner of Main Roads [No 7] [2011] WASC 223 (S)
Mentha As Receiver and Manager of Westgem Investments Pty Ltd (in liq) v Hughes as Liquidator of Westgem Investments Pty Ltd (in liq) [2014] WASC 478 (S)
Pourzand v Telstra Corporation Ltd [2012] WASC 210 (S2)
Santos Offshore Pty Ltd v Apache Oil Australia Pty Ltd [2015] WASC 242 (S)
The Pilbara Infrastructure Pty Ltd v Brockman Iron Pty Ltd [No 2] [2014] WASC 345 (S)

SMITH AJ:

The facts of the substantive matter that are relevant to the application for indemnity costs and a special costs order

The plaintiff, Steven Browne, is one of four sons of the defendant, Mr Browne. Mr Browne is the registered proprietor of a number of farming properties which Steven and his brothers have solely occupied to conduct their own farming operations. The property occupied by Steven is Burracoorong.
Until early 1999, Steven had been a partner in a farming partnership with Mr Browne, Mrs Browne and his brothers.
Steven's claim was that at various times from 1975, Mr Browne promised him that he would gift Burracoorong to him before, or upon the death of Mr Browne or upon the death of Steven's mother, Mrs Browne, and Mr Browne thereby induced an assumption to that effect.
In early 1999, Steven, Mr and Mrs Browne and Steven's three brothers entered into an agreement to split the farming partnership. It was not in dispute that part of the agreement was that Steven would be entitled to conduct his own farming business on Burracoorong (which initially excluded one paddock), Mr and Mrs Browne would leave the partnership, and Steven would pay $16,000 per annum to Mr Browne (being his contribution to an amount the brothers agreed to pay to their parents).
By 1999, Steven claimed that Mr Browne had induced an assumption by him (Steven) that:
(a)Mr Browne would gift the land that Steven farmed, namely Burracoorong, to Steven;
(b)Steven would farm Burracoorong, henceforth independently, at his own expense;
(c)Mr Browne would support Steven's farming by allowing Steven access to infrastructure on Yargalain (another of Mr Browne's farming properties which was farmed by his brother Peter); and
(d)by facilitating Steven's borrowing by permitting the use of the partnership's existing funding facility.
Until early 2015, Mr Browne facilitated Steven's improvements to Burracoorong and made Burracoorong available to Steven and his wife as security for borrowings for their farming operations.
By mid‑2013, the relationship between Steven and Mr Browne had begun to break down. In August 2013, Mr Browne demanded Steven sign a lease for Burracoorong for a term of 10 years with an option for a further term of 10 years, a base rent of $34,000 per annum with a reservation to Mr Browne of a right to sell.
On 12 August 2013, Mr Browne excluded Steven from access to the farming infrastructure on Yargalain. On 12 November 2013, Mr Browne informed Steven's bankers, Rabobank, that he required the bank to remove Steven's and his wife's mortgage over Burracoorong. By 20 November 2013, Mr Browne withdrew his instructions to Rabobank and the bank was informed Mr Browne would continue to honour his commitments under the current funding arrangements.
As a result of being denied access to the infrastructure on Yargalain, Steven constructed a fertiliser shed and a shearing shed and yards on Burracoorong. Steven's evidence was that Mr Browne had signed an application for planning approval for the development and construction work on 12 December 2013 and for the shearing shed on 20 February 2015.[1]
[1] The signing of these documents by Mr Browne were pleaded by amendments to the statement of claim after the Calderbank offer was made and rejected. Mr Browne claimed his signature on the documents was forged.
On or about 1 June 2017, Mr Browne refused to acknowledge his promise that he would give Burracoorong to Steven and refused to continue to guarantee Steven's borrowings (beyond the expiry of the current funding arrangement on 2 January 2018).
On or about 4 August 2017, Mr Browne demanded an increase in annuity (or rent) from Steven of $61,000 per year, commencing on 1 July 2017 and reserved his right to evict Steven from Burracoorong if Steven did not pay the sum of $64,000 by 11 August 2017.
On 4 August 2017, Mr Browne executed a will in which the conditions that attached to Steven's entitlement to Burracoorong, via testamentary trust, were inconsistent with the promise and were illusory because Steven's entitlement to Burracoorong was expressly irrevocable and the will required the payment of an amount that Steven was unable to pay.[2]
[2] The will was pleaded by amendment to the statement of claim after the Calderbank offer was made and rejected.
Steven claimed his reliance on the induced assumptions was to his detriment and sought relief in equity in a claim in proprietary estoppel created by encouragement by the owner of land as to the future acquisition of property.
Mr Browne pleaded that the asserted promise was vague and that in any event, the promise was executory and no estoppel would lie in aid of an executory promise.
Mr Browne's answer to Steven's case was that it was a term of the agreement reached with Steven (and the brothers in 1999) that, among other conditions:
(a)each of the brothers would use the land allocated to them;
(b)Mr Browne retained ownership of his land absolutely;
(c)Mr Browne was entitled to vary the allocation of the land at his absolute discretion;
(d)for as long as the brothers used the land they would each pay an amount to Mr and Mrs Browne until both of them died. The amount was to be determined by Mr and Mrs Browne at their absolute discretion, relative to their needs and obligations, and $16,000 per annum were initial amounts;
(e)Steven was given the right to access across Yargalain provided he equally bore the costs of electricity and maintenance during shearing seasons with Peter;
(f)Mr Browne agreed to continue to guarantee the existing debts of the partnership for the term of the guarantee and could, at his absolute discretion, agree to guarantee further loans; and
(g)provided the brothers individually complied with their obligations pursuant to the agreement, both Mr and Mrs Browne would make a will which provided that, upon the death of both of them, such of the brothers who had complied with the agreement would be given the land of which they had used.
Mr Browne counterclaimed that pursuant to the income discretion clause of the 1999 Agreement, Steven owed Mr Browne increased payments of $34,000 per annum, retrospectively from 1 July 2013 and $61,000 per annum from 1 July 2017.
In the alternative, Mr Browne claimed Steven owed him reasonable rent as a tenant at sufferance at the market rate of rent payable by lease holding farmers in the vicinity of Burracoorong.
In my reasons for decision in Browne v Browne [No 2][3] I found the evidence given by Mr Browne generally unreliable. In particular, I found his memory of events to be unreliable which could be caused by his advancing age or his partiality. I also found that he was not a person who paid meticulous regard to important documents signed by him.
[3] Browne v Browne [No 2] [2017] WASC 375.
Although I did not accept that Mr Browne agreed to gift Burracoorong to Steven before his death, I found it was agreed by Mr Browne that when the partnership split in 1999, Steven was to be gifted Burracoorong in Mr Browne's will and that this promise was made as an irrevocable promise, subject only to annual payments to Mr Browne or to Mrs Browne if Mr Browne predeceased her. I also found that:
(a)Steven had relied upon the promise;
(b)Steven and his wife had relied upon a representation by Mr Browne that Mr Browne would provide ongoing support (during his lifetime) by providing access to infrastructure on Yargalain and funding support to Steven and his wife's farming enterprise;
(c)Mr Browne had departed from the promise and representations to Steven; and
(d)if Mr Browne is allowed to depart from the promises and expectations, Steven and his wife would substantially suffer. They would likely lose their home and it appeared that they would be unable to continue to farm Burracoorong.
I also found the annual sum of $16,000 (subsequently increased to $18,000) to be paid by Steven, was an amount that was fixed as income to cover the living expenses for Mr and Mrs Browne in their retirement.
In these circumstances, the annual payments could not be characterised as rent and as such Mr Browne's counterclaim failed.
Following the publishing of reasons in Browne v Browne [No 2][4] I made the following orders in favour of Steven:
(a)A declaration that Mr Browne holds his legal interest in the property known as Burracoorong on trust for Steven.
(b)On the condition that Steven pay Mr Browne the sum of $64,000, Mr Browne is to forthwith deliver up a signed transfer of Burracoorong to Steven and will do all things reasonably necessary on his part to effect that transfer.
(c)Steven is to pay Mr Browne or if Mr Browne is deceased, Mrs Browne, no later than 31 January of each year a lump sum of $34,000, representing 25% of Mr Browne's and Mrs Browne's reasonable and quantifiable annual living expenses for each financial year commencing 1 July 2017.
[4] Browne v Browne [No 2] [2017] WASC 375.
I also made orders dismissing the counterclaim.

Steven's claim for costs

There is no dispute that Mr Browne should pay Steven's costs of the action. The question is whether those costs should be taxed on an indemnity or a party‑party basis. If the costs are to be taxed on a party‑party basis, Steven seeks costs of the action without reference to the limits provided in items 1(c), 7(b), 17 and 20(a), (b), and (d) of the Legal Profession (Supreme Court) (Contentious Business) Determination 2016 (WA) (2016 Determination) pursuant to s 280(2) of the Legal Profession Act 2008 (WA).

Application for indemnity costs

Steven made a number of offers to settle his dispute with his father, Mr Browne, prior to the commencement of the proceedings and a Calderbank offer[5] was made shortly before the trial of the action.
[5] Calderbank v Calderbank [1975] 3 All ER 333.
Steven submits as his primary position that the court should exercise its discretion and order that Mr Browne indemnify him for his reasonably incurred costs of the action. Alternatively, Steven seeks an order that the plaintiff's costs should be taxed without reference to the scale, until the plaintiff's offer of 24 October 2017 was rejected and thereafter, on an indemnity basis.
The relevant principles which govern the exercise of the court's discretion in the context of a Calderbank offer were set out by Buss JA in Ford Motor Company of Australia Ltd v Lo Presti.[6] In Eccles v Koolan Iron Ore Pty Ltd[7] Le Miere J summarised the principles explained by Buss JA in the following way:[8]
[6] Ford Motor Company of Australia Ltd v Lo Presti [2009] WASCA 115 [16] ‑ [32] (Wheeler JA agreeing).
[7] Eccles v Koolan Iron Ore Pty Ltd [2013] WASC 418 (S).
[8] Eccles v Koolan Iron Ore Pty Ltd [2013] WASC 418 (S) [9]
(1)a Calderbank offer will not justify an award of indemnity costs unless its rejection was unreasonable;
(2)all of the relevant facts and circumstances must be considered in determining whether a party's rejection of a Calderbank offer was unreasonable;
(3)the mere fact that the recipient of a Calderbank offer is ultimately worse off than he or she would have been had the offer been accepted, does not mean that its rejection was unreasonable;
(4)whether conduct is reasonable or unreasonable always involves matters of judgement and impression;
(5)it is not possible nor desirable to enumerate exhaustively all circumstances which must be taken into account, in a particular case, in deciding whether the rejection of a Calderbank offer was unreasonable, but, ordinarily, regard should be had to, at least, the following:
(a)the stage of the proceeding in which the offer was received;
(b)the time allowed to the offeree to consider the offer;
(c)the extent of the compromise offered;
(d)the offeree's prospects of success, assessed as at the date of the offer;
(e)the clarity with which the terms of the offer were expressed; and
(f)whether the offer foreshadowed an application for indemnity costs in the event of the offeree's rejecting it;
(6)the party who makes a Calderbank offer that is rejected bears the onus of satisfying the court that it should make an award of indemnity costs in his or her favour; and
(7)the standard to be applied in awarding indemnity costs should not be allowed to diminish to the extent that an unsuccessful party will be at risk of an order for costs assessed on an indemnity basis absent some blameworthy conduct on its part - a test of unreasonableness should not be upheld on other than clear grounds.

The claim for indemnity costs

In August 2013, Steven received a letter from Mr Browne's solicitors attaching a draft lease to sign. The draft lease contained among other conditions, a base rent of $34,000 per annum payable by annual instalments of $17,000 each on 1 July and 1 January during the term of the lease, which was said to commence on 1 July 2013.
In February 2014, Steven by his solicitors sent two letters attempting to settle the dispute concerning payments to Mr Browne and Steven's tenure on Burracoorong.
The first letter is dated 7 February 2014 and was tendered into evidence in the proceedings at first instance.[9] It communicated the willingness of Steven to compromise to reach agreement which, Steven says, if accepted would have avoided the need for the proceedings.
[9] Exhibit 18.
In a second letter dated 19 February 2014 Steven offered to settle the dispute between him and Mr Browne as follows:
(a)Steven and his wife would pay Mr Browne $34,000 per year, payable in January;
(b)Mr Browne would continue to guarantee the loan facility that Steven and his wife have with Rabobank to $1,050,000 (for the life of the loan and as extended for any new loan for the same amount from time to time), and agrees to maintain a mortgage over Burracoorong; and
(c)Mr Browne will formally acknowledge that Burracoorong would be left to Steven, consistent with the arrangement reached in 1998 (provided that annual payments to Mr Browne are made and that Steven and his wife can continue to farm Burracoorong in a commercially viable way).
Steven's offer imposed no time limit for acceptance.
This offer was rejected.
It is contended on behalf of Steven that the rejection of this offer by Mr Browne was not reasonable in the circumstances because Steven's offer provided Mr Browne with the substance of what he was seeking (ie security of payment, security of ensuring that Steven must not get into financial difficulty), without the over‑riding of Steven's existing rights that signing a lease would have involved.
Steven commenced these proceedings by a writ of summons filed in the court on 26 June 2017.
By letter dated 24 October 2017, Steven made an offer to settle the matter as follows:
(a)Mr Browne retain the ownership of Burracoorong, and be paid $34,000 for the 2017 ‑ 2018 financial year with annual CPI increases; or
(b)Burracoorong be transferred to Steven but with an obligation imposed on Steven to pay the sum of $500,000 to Mr Browne in instalments.
It was also a condition of each alternative offer that Steven would agree to an order that the proceedings be dismissed and to an order that he pay Mr Browne's taxed costs of the proceedings and that there would otherwise be no order as to costs.
Steven's offer remained open for acceptance by Mr Browne until close of business on 27 October 2017. It was made as a Calderbank offer. In the letter it was stated that in the event that Mr Browne rejects the offer and Steven achieves the same or a better outcome, Steven will rely upon the letter containing the offers in support of an application that Mr Browne pay his costs on an indemnity basis, from the date of the offer.
The 2017 October offer was expressed to be open for a short time. However, the parties had attended mediation and concluded negotiations in mid‑September 2017. The offer was made at an advanced stage of the proceedings (13 days before the commencement of trial). The parties had already filed their evidence‑in‑chief. At that time, Mr Browne was in possession of the evidence‑in‑chief to be called by Steven at the hearing to assess that evidence against his claims and his defences.
The 2017 October offer involved significant compromise on Steven's behalf. The offer involved no material compromise from Mr Browne because:
(a)he would receive a greater financial return than what he had been seeking from Steven, and was seeking from him in his counterclaim by way of 'rent';
(b)he had not been paying any costs associated with owning the property and that would remain the case; and
(c)Steven would be the owner, which on the evidence as to the 1999 arrangements was what Mr Browne had originally intended (and indeed up until 2013 was what he still unequivocally intended).
I also accept that the 2017 October offer set out in clear and unambiguous terms with reference to Mr Browne's own evidence as to why Mr Browne would not be successful in his defence and the prosecution of his counterclaim.
I am also satisfied that it is clear that the outcome for Mr Browne at the trial was significantly less advantageous to him than either of the alternatives put in the 2017 October offer.
The sole issue for determination is whether the rejection of the 2017 October offer by Mr Browne, at the time the offer was made, was in the circumstances unreasonable.
Immediately after the offer expired, Steven sought to amend his statement of claim to raise two new issues which, on the facts that were ultimately found in the substantive hearing of Steven's claim, strengthened Steven's case.
On 31 October 2017, an order was made allowing Steven to file a re‑amended statement of claim by 1 November 2017. Amendments were also sought by Mr Browne to his counterclaim. After counsel for the parties conferred, Steven did not oppose the order sought by Mr Browne.

The first amendment to the statement of claim that is material to the claim for indemnity costs is a pleading that on 12 December 2013 and 20 February 2015 Mr Browne facilitated development and construction work on Burracoorong by signing development applications submitted to the Shire of Chittering.
Mr Browne claimed the signature on the documents in question were forged.
I allowed the amendments after finding that as Mr Browne had notice of the issue since 5 October 2017, Mr Browne could not be said to be taken by surprise by the amendment.[10]
[10] Browne v Browne [No 2] [2017] WASC 375 [46] ‑ [47].
The second relevant amendment to the statement of claim related to the terms of the will executed by Mr Browne on 4 August 2017 in which Steven's entitlement to Burracoorong, via testamentary trust, was expressly revocable and subject to a number of conditions which included payments to his sisters totalling $1.2 million.[11] I allowed the amendments as they raised discrete issues which related solely to the terms of the will, and the disposition of those amendments turned on only the express terms of the document and did not raise an issue going to the circumstances of the making of the will.
[11] Browne v Browne[No 2] [2017] WASC 375 [41] ‑ [42].
The terms of this will were found in the trial to be evidence that Mr Browne had resiled from the expectations that he had induced by his promises.[12]
[12] Browne v Browne[No 2] [2017] WASC 375 [275(f)], [275(g)].
For the purposes of determining whether the rejection of the October 2017 offer was unreasonable, it is relevant to consider the matters pleaded, the nature of the evidence and the manner in which the trial was conducted.
The trial was expedited and was heard for five days from 6 until 10 November 2017 (less than six months after the writ was filed in the court).
Steven and Mr Browne's case were substantially founded upon evidence of communications between each other and the other brothers.
Steven's case also relied upon documents which recorded matters discussed at family meetings including at least one contemporaneous record Steven made of a conversation between himself and Mr Browne.
Whilst there were contemporaneous records of discussions at family meetings that led to the 1999 agreement there was no document in existence that clearly set out the terms of the 1999 agreement. However, there were matters recorded in the notes of family meetings and letters recording discussions between family members that supported Steven's case.
Whilst it appeared that Steven had a strong case in the event that his version of events was to be accepted, prior to trial it was not certain that much of Mr Browne's evidence would not be accepted. I did not find Mr Browne to be a dishonest witness but I rejected critical aspects of his evidence.
At the time the 2017 October offer was made it was anticipated by Mr Browne that expert evidence may bolster his claim that Steven had forged the 2013 and 2015 planning documents (to build infrastructure on Burracoorong after access was denied to Yargalain). An expert subsequently examined the documents after Mr Browne had rejected the offer. It only emerged at the trial that the expert evidence did not support Mr Browne's evidence and Mr Browne's memory was found to be faulty.
Disbelief of a party's witnesses, or rejection of the evidence of a party him or herself, does not as a matter of principle provide a sufficient basis for the award of indemnity costs.[13]
[13] Eccles v Koolan Iron Ore Pty Ltd [2013] WASC 418 (S) [13].
The power to award indemnity costs is exceptional in character. There must be some special or unusual feature to justify departure from the ordinary practice of awarding party‑party costs.[14]
[14] McKay v Commissioner of Main Roads [No 7] [2011] WASC 223 (S) [109].
In circumstances where:
(a)the acceptance of Steven's case turned to a large degree on the assessment of his credit as a witness and rejection of Mr Browne's case substantially turned upon grounds of his credibility; and
(b)material amendments were made to the statement of claim after the 2017 October offer was rejected;
I am not satisfied that the rejection of the October 2017 offer was unreasonable.
For these reasons, I am not satisfied that the court should make an award of indemnity costs in favour of Steven.

Is the discretion to make a special costs order enlivened and should an order be made?

Section 280(2) of the Legal Profession Act provides that a court may make a special costs order where it is of the opinion that 'the amount of costs allowable in respect of a matter under a costs determination is inadequate because of the unusual difficulty, complexity or importance of the matter'.
The court must form an opinion about two matters before it can make an order under s 280(2). First, it must form an opinion that the costs allowed by the applicable legal costs determination are inadequate and second, it must form an opinion that the amount allowed is inadequate because of the 'unusual difficulty, complexity or importance of the matter'.
If those preconditions are met then the court may do all or any of the following:
(a)order the payment of costs above those fixed by the determination;
(b)fix higher limits of costs than those fixed in determination;
(c)remove limits on costs fixed in the determination; and
(d)make any order or give any direction for the purposes of enabling costs above those in the determination to be ordered or assessed.[15]
[15] Legal Profession Act 2008 (WA) s 280(2).
An assessment of whether an amount of costs allowed in respect of a matter under a legal costs determination is inadequate is not to be determined by the court in a precise way. Martin CJ in Mentha v Hughes explained:[16]
The principles governing the exercise of the powers conferred upon the court by s 280(2) of the Act are well established. The discretion conferred by the section can (but need not) be exercised if the court is of the opinion first that the amount of costs allowable in respect of a matter the subject of a cost determination is inadequate, in the sense that a limit or other amount imposed by the determination would preclude the presentation of a fairly arguable case for the allowance of costs at a greater amount and second, that the inadequacy arises because of the unusual difficulty, complexity or importance of the matter.
When a party moves for an order pursuant to s 280(2) of the Act, the questions arising under the section are addressed as matters of impression rather than science or mathematical precision. In some cases it will be necessary to adduce evidence to enable the formation of the requisite opinion. However, in other cases, a court might be able to form the necessary opinion from its knowledge of the case and its circumstances. Moreover, it must be remembered that when an order is sought removing limits on costs fixed in an applicable determination pursuant to s 280(2)(c), the order made will do no more than that. Accordingly, the court considering the application for such an order need go no further than determine whether there is a fairly arguable case for the allowance of costs at an amount greater than the amount allowable under the relevant determination - it is for the taxing officer to consider the necessity for the work that was done and the reasonableness of the remuneration claimed.
[16] Mentha As Receiver and Manager of Westgem Investments Pty Ltd (in liq) v Hughes as Liquidator of Westgem Investments Pty Ltd (in liq) [2014] WASC 478 (S) [4] ‑ [5].
In considering the second step, the court must conclude that the inadequacy arises because of the unusual difficulty, complexity or importance of the matter. It is established that the word 'unusual' qualifies only the term 'difficulty' and not the terms 'complexity or importance'.[17] Importance is understood to only encompass importance to the parties and not importance to the public or a sector of the public.[18]
[17] Cape Lambert Resources Ltd v MCC Australia Sanjin Mining Pty Ltd [2013] WASCA 66 (S) (the court); applied in Santos Offshore Pty Ltd v Apache Oil Australia Pty Ltd [2015] WASC 242 (S) [9] (Pritchard J).
[18] Heartlink Ltd v Jones As Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254 (S) [17] ‑ [19] (Martin CJ).
In Pourzand v Telstra Corporation Ltd[19] and The Pilbara Infrastructure Pty Ltd v Brockman Iron Pty Ltd [No 2][20] Edelman J said that the question of 'unusual difficulty, complexity or importance' should be asked separately in relation to each item for which the lifting or removal of the scale is sought. This approach was rejected by Martin CJ in Electricity Generation and Retail Corporation Trading as Synergy v Woodside Energy Ltd.[21] His Honour found that the expression should be construed as meaning the issue, dispute or controversy in respect of which legal services were provided and which fall within the ambit of a costs determination.[22]
[19] Pourzand v Telstra Corporation Ltd [2012] WASC 210 (S2) [24] ‑ [25].
[20] The Pilbara Infrastructure Pty Ltd v Brockman Iron Pty Ltd [No 2] [2014] WASC 345 (S) [6].
[21] Electricity Generation and Retail Corporation Trading as Synergy v Woodside Energy Ltd [2014] WASC 469 (S).
[22] Electricity Generation and Retail Corporation Trading as Synergy v Woodside Energy Ltd [2014] WASC 469 (S) [7].
The reasoning of Martin CJ in Electricity Generation v Woodside was found to be persuasive and applied by Beech J in Eclipse Resources Pty Ltd v The State of Western Australia [No 2].[23] This approach was also applied by Pritchard J in Santos Offshore Pty Ltd v Apache Oil Australia Pty Ltd.[24] In my respectful view, the reasoning of Martin CJ in Electricity Generation v Woodside is persuasive and I propose to adopt his Honour's approach.
[23] Eclipse Resources Pty Ltd v The State of Western Australia [No 2] [2015] WASC 137 [35].
[24] Santos Offshore Pty Ltd v Apache Oil Australia Pty Ltd [2015] WASC 242 (S) [10].
However, this approach does not mean that an examination of individual items of the costs determination should not be considered when determining whether costs allowable in respect of the work done is inadequate. In Electricity Generation v Woodside Martin CJ explained:[25]
The question which must be addressed either in respect of individual items or a costs determination as a whole is whether the costs allowable in respect of the work done are inadequate because of the particular characteristic or characteristics of the 'matter' which has or have enlivened the jurisdiction of the court - that is, unusual difficulty, complexity or importance.
[25] Electricity Generation and Retail Corporation Trading as Synergy v Woodside Energy Ltd [2014] WASC 469 (S) [12].

Whether the amounts allowed under the relevant items of the scale are inadequate

Phillip Bruce Dobson, solicitor for Steven, deposes in an affidavit sworn on 19 February 2018 that in about March 2017, after it appeared to him that it would be necessary for Steven to commence proceedings, he sought instructions from Steven to engage senior counsel. Mr Dobson's opinion that senior counsel should be engaged was premised on the following:
(a)the importance of the matter to Steven, given that there was a potential for him to no longer be able to continue to live and farm on Burracoorong;
(b)Mr Dobson's view was that the matter was sufficiently difficult to warrant the engagement of senior counsel, given the equitable nature of the claim and the facts giving rise to the plaintiff's claim traversed an extended period of time involving conversations and acts of reliance from a relatively long time ago, and did not rely on any formal written agreement;
(c)Mr Dobson's view that the proposed senior counsel, Mr M Solomon SC, had experience in equitable claims of this nature; and
(d)Mr Dobson's view based on his experience of Mr Solomon's work at previous mediations that he (Mr Solomon) would take a pragmatic and proactive approach in attempting to settle the matter, which he (Mr Dobson) considered to be particularly important given that the dispute involved members of the same family.
Mr Dobson also deposes that:
(a)after mediation had occurred on 24 August 2017 the parties continued to negotiate settlement of the dispute until about mid‑September. The negotiations of the parties (of which the court was informed) resulted in the parties agreeing to defer the preparation of the matter for trial, by extending the trial preparation milestones in the hope that the matter might settle and the parties be spared the costs of preparing for trial;
(b)the consequence of the parties deferring the trial preparation milestones was that post‑mediation settlement discussions ceased, and there was less time to prepare the matter for trial (a trial which had already been listed on an expedited basis);
(c)as a result of being given a very short time available to prepare the matter for trial it became necessary to engage junior counsel to assist; and
(d)a considerable amount of work was necessary to be undertaken to prepare the matter for trial in a very short period of time and that without the assistance of junior counsel, Steven would not have been able to effectively prepare his case for trial as effectively as he did.
From these circumstances, Steven makes a claim for a special costs order on the following grounds:
(a)Steven's case disclosed a complex and lengthy factual background giving rise to Steven's claim against Mr Browne together with complex considerations of the appropriate relief to be granted by the court in the very particular circumstances of the arrangements made between Mr Browne and Steven;
(b)the matter involved unusual difficulty or complexity that might ordinarily not be expected in the trial of this nature because of the extensive time period covered by the litigation (about which evidence was required to be gathered and witness statements prepared) and because of the truncated timeframe for the preparation of the matter for trial;
(c)because of Mr Browne's denials or non‑admissions in his defence, the preparation of Steven's witness statement and his case involved analysis of many historical financial documents, spanning 1991 to 2017 to prove partnership borrowings, expenditure on the construction and maintenance of his house and on infrastructure built on Burracoorong;
(d)preparation for trial also involved the collation of evidence derived from diary entries spanning some 18 years in order to prove that Steven undertook significant development work on Burracoorong;
(e)these circumstances resulted in a particularly large trial bundle containing more than 4,000 pages with documents traversing a 43 year period from 1974 to 2017; and
(f)the expedited nature of the claim meant that Steven prepared lengthy opening submissions filed prior to the trial to save time in what would otherwise have necessitated lengthy oral opening submissions by senior counsel. Similarly, senior counsel's oral closing submissions were able to be truncated by the provision to the court of comprehensive closing submissions in writing.
Against this background, Steven claims that the scale for item 1(c) of the 2016 Determination which provides for an amount of $4,840 is inadequate. In an affidavit of Lewis James Whitehurst sworn on 19 February 2018 he attaches a draft bill of costs which estimates costs of settling the statement of claim, not including either senior or junior counsel's fees for settling, of $8,996.10.
Item 7(b) of the 2016 Determination provides for an amount of $4,840 for discovery. This amount is also said to be inadequate. The affidavit of Steven sworn on 28 September 2017 verifying the discovered list of documents shows that the discovery was large (more than 40 lever arch volumes) and involved documents covering an expansive period of time and included diaries, financial diaries, invoices and a large number of business records. The scope of discovery given arises directly from Steven's claim and the fact that the defence pleaded by Mr Browne puts most of the matters in dispute. The draft bill of costs attached to Mr Whitehurst's affidavit estimates a cost giving discovery of documents of $13,612.50.
Steven also claims that the preparation of case and fees on brief items in the scale are inadequate:
(a)Item 17 of the 2016 Determination provides for 120 hours and an amount of $58,000.80 for preparation of case. The draft bill discloses costs of $107,411.93, not including work reasonably and necessarily undertaken for commencement of proceedings which is permitted by the scale;
(b)Item 20(b) of the 2016 Determination provides for an amount of $30,690 for senior counsel's fee on brief, including trial preparation and submissions. The draft bill discloses costs of $115,690;
(c)Item 20(a) of the 2016 Determination provides for an amount of $17,820 for counsel's fee on brief, including trial preparation and submissions. The draft bill discloses costs of $60,020.40; and
(d)Item 20(d) of the 2016 Determination provides for $6,820 per day for the second and each successive day of the hearing for senior counsel. Senior counsel's daily fees were $7,800 plus GST.
Taking into account the court's impression of the case, I am satisfied that its unusual factual and legal complexity required an extensive volume of work necessary for the preparation for trial. I am also satisfied that the matter was of significant importance to the parties. When regard is had to these matters, it is open to infer that there is a fairly arguable case that a taxing officer might properly allow costs, for senior and junior counsel for settling the statement of claim, the engagement of senior and junior counsel for the trial, and discovery, in amounts greater than the amounts allowable under the 2016 Determination.
However, it is properly the task of the taxing officer to assess whether or not to allow all of the costs charged for the legal work covered by each of the items the subject of order.
Given the circumstances outlined on behalf of Steven, I am satisfied that the limits provided in items 1(c), 7(b), 17, 20(a), 20(b) and 20(d) of the 2016 Determination are inadequate and I am persuaded that the scale limits on these items should be lifted.

Conclusion

For these reasons, I will make an order pursuant to s 280(2) of the Legal Profession Act that Mr Browne pay Steven's costs of the action on a party‑party basis without reference to any of the limits provided in items 1(c), 7(b), 17, 20(a), 20(b), and 20(d) of the Legal Profession (Supreme Court) (Contentious Business) Determination 2016.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
VV
ASSOCIATE TO SMITH AJ
11 APRIL 2018