Chow v Yang (No 2)

[2011] SADC 19

DISTRICT COURT OF SOUTH AUSTRALIA

(Civil)

CHOW & ORS v YANG & ORS (No 2)

[2011] SADC 19

Judgment of His Honour Judge Barrett

23 February 2011

PROCEDURE - COSTS

At the end of the trial the court ordered the plaintiff to pay the defendant's costs, such costs to be agreed or taxed.  The defendant seeks, and the plaintiff opposes, the costs of senior counsel.

Held: the case appeared at the delivery of the brief to be sufficiently complex that it was reasonable for the defendant and his solicitors to consider it prudent to instruct senior and junior counsel.

Supreme Court Civil Rules 2006 (SA) r 274(3)(a), referred to.
Beeasley v Marshall (No 3) (1986) 41 SASR 321; Andrewartha v Andrewartha (No 2) (1987) 45 SASR 85, considered.

CHOW & ORS v YANG & ORS (No 2)
[2011] SADC 19

1. I delivered judgment in this matter on 11 June 2009.  I made findings substantially in favour of the defendant, although in the result, the defendant was required to pay the plaintiff a sum of money.  I ordered the plaintiffs to pay the defendant’s costs on a party/party basis as from 17 April 2007.  The costs were to be taxed or agreed. 

2. There has arisen a dispute between the parties about whether the plaintiff should pay costs of senior and junior counsel who represented the defendant at trial.  The plaintiff was represented by junior counsel and a solicitor at the bar table.  The defendant was represented by senior and junior counsel and a solicitor was often present in court although I do not know how often.

3. A Master has referred to me the question of whether the costs of senior counsel should be recoverable by the defendants.

4. This question has been discussed by the Full Court in Beasley v Marshall (No 3) (1986) 41 SASR 321. His Honour Chief Justice King[1] said:

   In determining whether the fees of Queen's Counsel were necessary or proper to be incurred for the attainment of justice or the defence of the party's rights, the primary considerations are undoubtedly the difficulty of the case, the complexity of the issues of fact or law, and any demands which the case makes for the exercise of special professional skills. But I do not think that the Taxing Master is required to ignore what is at stake for the party in the litigation: Stanley v. Phillips⁷³, per Barwick C.J. at p 480 and per McTiernan J. at p 482.

   [1]    at 332.

5. Further, His Honour made clear that the time at which to determine the appropriateness of the engagement of senior counsel is the time the brief is delivered.  His Honour said[2]:

   It is well established that the question is not to be answered with the wisdom of hindsight but is to be judged as at the proper time for the delivery of briefs. The test propounded in the first limb of the rule, applied to the question of fees for senior counsel, may be paraphrased therefore as whether a reasonable litigant, at the proper time for the delivery of briefs, would consider it necessary or at least prudent to brief Queen's Counsel for the adequate presentation of his case: Stanley v. Phillips, per Taylor and Owen JJ. at p 486.

   [2]    at 331.

6. In that same case Olsen J added[3]:

   … the useful question to be posed is as to whether a reasonable and competent solicitor, advising his client at that time, would have been justified, on the state of his knowledge at that point, in concluding that the case did require the skills of senior counsel for its adequate presentation.

   In considering issues of this type it is patently untenable to attempt to classify generic types of cases as warranting or not warranting senior counsel. Each case must obviously be assessed on its merits. Equally the monetary amount in issue cannot be a direct determinant factor, although it may well be indicative in many instances (although not always) of the degree of likely complexity or difficulty of a matter.

   (See also Andrewartha v Andrewartha (No 2) (1987) 45 SASR 85 at 88 per O’Loughlin J.)

   [3]    at 334.

7. Rule 274(3)(a) of the Supreme Court Civil Rules 2006 (SA) provides:

   The following general principles will be applied:

   (a)    costs will be allowed so far as they are necessary and reasonable  but not so far as they result from over-caution, negligence or mistake;

8. Mr Ower for the defendant referred to the above authorities and drew attention to relevant features of the brief in this matter as it would have appeared to the defendant’s solicitors before counsel were engaged.  The sum in issue was reasonably substantial.  Depending upon orders for interest there might have been somewhere between and $300,000 and $500,000 at issue.  It was clear from the pleadings that there was going to be a considerable challenge to credit.  The plaintiff was alleging that the defendant was guilty of deceit.  Mr Ower further submitted that the case was not just one involving a reasonably substantial amount of money, it involved the defendant’s valued reputation as an honest businessman.  He was a prominent shop owner running a business which was prominent in the Chinatown precinct of Adelaide.  His reputation was at stake.  It was being suggested by the plaintiff that he had reneged on an agreement with a fellow countryman and had falsely claimed that the plaintiff had run the business down.  These apprehensions were all borne out by an eleven day trial.  It was not as if matters which appeared complicated on the delivery of the brief became less so at trial.

9. On behalf of the plaintiff, Mr Cogan submitted that the issues were not of great complexity.  He submitted that the quantum, while substantial, was not great.  He submitted that the test for the appropriateness of engagement of silk was not to maximise the chances of winning.  The question is one of reasonable prudence.  He submitted that the matter was not legally complicated.  He pointed to details of the taxation to demonstrate that only a moderate amount of preparation time was required by senior counsel.  Further, senior counsel’s attendances were later in the piece than those of junior counsel.  Mr Cogan said that this suggested that junior counsel had been able to begin the preparation on his own.  However, as I pointed out to counsel, that might be seen as one of the features of a case requiring senior counsel.  The chargeable rate by senior counsel is higher but the time required for preparation is less by reason of the greater experience which senior counsel can draw on.

10. I am persuaded that the defendant and his solicitor would reasonably have considered it prudent to brief senior counsel for the adequate presentation of his case.  Serious allegations about his honesty were being made.  It was foreseeable that there would be some forensic complexity in defending him from allegations of impropriety which bore directly on the outcome of the trial.  The monetary amount in dispute was not great, but it was not insubstantial.

11. In my view it was appropriate for the defendant to brief senior and junior counsel to represent his case at trial.

12. It will be a matter for the taxing Master to determine the reasonableness of the attendances of each counsel and the solicitor.