Clone Pty Ltd v Players Pty Ltd - [2022] SASC 51

Supreme Court of South Australia
(Civil)
CLONE PTY LTD v PLAYERS PTY LTD (No 4)
[2022] SASC 51
Judgment of Auxiliary Judge Norman a Master of the Supreme Court
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - TAXATION AND OTHER FORMS OF ASSESSMENT - PARTICULAR ITEMS - DISBURSEMENTS - PARTY'S EXPENSES - TRAVELLING EXPENSES, ATTENDANCE ALLOWANCE ETC
Rulings on Taxation of costs.

CLONE PTY LTD v PLAYERS PTY LTD (No 4)
[2022] SASC 51
Supreme Court – Civil

This is a continuing taxation of the costs of the applicant Clone in these proceedings.
In these reasons the applicant will be referred to as “Clone” and the respondent as “Players”.
Background
The costs now being taxed are those claimed by Clone in its itemised Schedule of Costs filed on 11 March 2008, FDN 146, being two volumes containing five parts for separate time periods with a total of 6008 items.
The taxation of the Schedule was competed on 29 June 2021, however large numbers of items were reserved. The remaining items have since been grouped into discrete topics, and there are now being taxed in progression.
The items recently taxed included the personal and related attendances of Mr Mark Hamilton and Ms Tonia Karagiannis, the principal solicitors acting for Clone during the trial before Vanstone J. In addition, there were clerical attendances, telephone calls, and some correspondence. Players had objected to these items and they were reserved before further materials and evidence were provided to substantiate them.
As part of this process, affidavits of both Mr Hamilton and Ms Karagiannis were filed by Clone, being FDN 272 (Ms Karagiannis’ affidavit of 19 August 2021) and FDN 273 (Mr Hamilton’s affidavit of 20 August 2021).
In their respective affidavits Mr Hamilton and Ms Karagiannis identified the items in dispute, explained their respective roles in the litigation (including Clones’ position that on occasions it was necessary for two solicitors to be working concurrently on the matter), and elaborated on Clone’s claim for the identified items. The also explained the roles of clerks assisting in the litigation.
Both affidavits exhibited supporting documentation including copies of file notes, transcriptions of these in many instances (as some were not legible or were abbreviated) and containing further particulars elaborating on what the claims and attendances were about and why they were necessary.
In his affidavit, Mr Hamilton provided an “aide-memoire” in respect of certain items relating to his attendances in the claim for costs.
At a subsequent directions hearing Mr Cogan, for Players, informed the Court that it wished to cross-examine both Mr Hamilton and Ms Karagiannis on their affidavits, and a hearing was fixed for this purpose.
On 16 November 2021, Mr Hamilton and Ms Karagiannis were cross‑examined on their affidavits by Mr J Whitington, Counsel for Players.
Following that cross-examination, Players filed submissions on 24 February 2022, FDN 278, as to the weight to be given to Mr Hamilton’s affidavit, and on 2 March 2022, Clone filed its responding submissions, FDN…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2022] SASC 51
Decision Date: 17 May 2022

CaseChat Overview and Summary

The matter before the court involved a dispute over the taxation of costs between Clone Pty Ltd and Players Pty Ltd. Clone had submitted a Schedule of Costs comprising numerous items, which Players contested. The court was required to determine whether certain items, specifically the attendance of solicitors and related expenses, were justified and should be allowed as costs. The primary issue was whether Clone could substantiate the necessity of these items, particularly in light of delays and missing documentation, and whether the affidavits provided by the solicitors were sufficient evidence to support the claims.

The court examined the obligations of the parties in maintaining records and substantiating costs claims. It noted that while a party is not strictly bound by the rules of evidence in a taxation, there must still be evidence to support each claim. The court found that Clone's failure to maintain adequate records and provide contemporaneous documentation was a significant impediment to justifying the claimed costs. The affidavits, while helpful, were not sufficient to substantiate the detailed claims without proper supporting evidence. The court also considered the relevance and accuracy of the affidavits and the potential for bias or lack of recollection in the documentation provided.

Ultimately, the court ruled that certain items could not be substantiated due to the lack of adequate evidence. It allowed some items based on the affidavits and other limited evidence available, but disallowed others where the substantiation was insufficient. The court emphasized the importance of parties maintaining proper records and providing timely and accurate evidence to support their claims for costs.

The final orders included disallowing certain costs due to insufficient evidence and allowing others with some evidence. The court scheduled further hearings to address the remaining contested items in the Schedule of Costs.

Orders

Orders of the court

Rulings on Taxation of costs.

Background

Background to the litigation

In these reasons the applicant will be referred to as “Clone” and the respondent as “Players”.Background The costs now being taxed are those claimed by Clone in its itemised Schedule of Costs filed on 11 March 2008, FDN 146, being two volumes containing five parts for separate time periods with a total of 6008 items. The taxation of the Schedule was competed on 29 June 2021, however large numbers of items were reserved. The remaining items have since been grouped into discrete topics, and there are now being taxed in progression. The items recently taxed included the personal and related attendances of Mr Mark Hamilton and Ms Tonia Karagiannis, the principal solicitors acting for Clone during the trial before Vanstone J. In addition, there were clerical attendances, telephone calls, and some correspondence. Players had objected to these items and they were reserved before further materials and evidence were provided to substantiate them. As part of this process, affidavits of both Mr Hamilton and Ms Karagiannis were filed by Clone, being FDN 272 (Ms Karagiannis’ affidavit of 19 August 2021) and FDN 273 (Mr Hamilton’s affidavit of 20 August 2021). In their respective affidavits Mr Hamilton and Ms Karagiannis identified the items in dispute, explained their respective roles in the litigation (including Clones’ position that on occasions it was necessary for two solicitors to be working concurrently on the matter), and elaborated on Clone’s claim for the identified items. The also explained the roles of clerks assisting in the litigation. Both affidavits exhibited supporting documentation including copies of file notes, transcriptions of these in many instances (as some were not legible or were abbreviated) and containing further particulars elaborating on what the claims and attendances were about and why they were necessary. In his affidavit, Mr Hamilton provided an “aide-memoire” in respect of certain items relating to his attendances in the claim for costs. At a subsequent directions hearing Mr Cogan, for Players, informed the Court that it wished to cross-examine both Mr Hamilton and Ms Karagiannis on their affidavits, and a hearing was fixed for this purpose. On 16 November 2021, Mr Hamilton and Ms Karagiannis were cross‑examined on their affidavits by Mr J Whitington, Counsel for Players. Following that cross-examination, Players filed submissions on 24 February 2022, FDN 278, as to the weight to be given to Mr Hamilton’s affidavit, and on 2 March 2022, Clone filed its responding submissions, FDN 279. In Players’ submissions it was contended that the aide-memoires were not contemporaneous notes of the matters which they recorded, and that Mr Hamilton did not say in his affidavit that at the time he made each aide-memoire he had a present recollection of the matters referred to therein. In his cross-examination, he had claimed a recollection in only limited instances (transcript of evidence at pages 20 (item 828), 22 (item 930), 37 (item 4931), 49 (item 5093), 43 (item 5644) and 58 (item 4741). It was acknowledged that on a taxation and pursuant to Uniform Civil Rules (UCR) 195.8(2) a Taxing Officer was not bound by the rules of evidence, but submitted that as a matter of logic there had to be some evidence in support of any proposition put by a party. The submissions referred to Cross on Evidence (online)[1] to the effect that a document to refresh memory had to have been made substantially at the same time as the occurrence of events, and had been made and read over and accepted as accurate by the witness while the facts were still fresh in the witness’s memory. They also referred to Haslbury’s Law of Australia (online)[2] that the essential question was the state of witness’s memory at the time of making or the adoption of the notes, and that the shortness of time made it easier to accept the witness’s assertion that the facts were fresh.[1] Cross on Evidence (online) at paragraph [17180].[2] Haslbury’s Law of Australia (online) at paragraph [195]-[7820].

Evidence

Evidence Before The Court

I will hear from the parties when the taxation resumes as to the balance of the claim made in that item.Evidence on a taxation of a claiming solicitor’s attendances In the parties’ written submissions FDN 278 and FDN 279 and in their oral submissions at the 10 March 2022 hearing they addressed the evidence available to the Court in relation to the disputed claims for attendances of Clone’s solicitors and related items. The first issue raised was the fact of the delay occasioned in the proceeding of this taxation by reasons of the set aside application initiated by Players. Clone had argued that its inability to obtain evidence to substantiate items claimed in its Bill, and the difficulties with missing documents, incomplete files and witnesses not having actual recollections as to the trial which had occurred some 17 years before, and the like were the product of Players’ own making and that the Court should not permit the impediments caused by these issues to be visited on Clone to its prejudice. However, the fact is that a party to proceedings has an obligation to maintain an adequate record of its costs – 6R rule 262 (albeit that this only requires a record to be kept sufficient to allow the expeditious production of a Claim for Costs under 6R 271(1) and 271(2), which is considerably less detailed than what is required for properly preparing an itemised Schedule, Baronglow Pty Ltd v Thomas (No 7),[14] Judge Lunn at [16], Uniform Civil Rules 191.2 is to similar effect.[14] Baranglow Pty Ltd v Thomas (No 7) [2008] SASC 33 A party must ensure that its records to substantiate any claim for costs in its favour are properly kept and maintained whatever twists and turns the case may take, and however long the period may be between the undertaking of the work and the eventual taxation. There are often reasons why the progression of claims for costs are delayed, and the consequences for a party which is unable by reason of its own actions to properly substantiate its costs, cannot be visited on the paying party which will not privy to the details of the claiming party’s costs, and how they are recorded and substantiated, until the taxation process commences. Further, it is clear from the authorities referred to below that a party seeking to recover costs but which cannot substantiate the detail of an attendance, other than to establish that fact of the attendance, is at risk of the Court coming to the conclusion that the attendance was unnecessary, and disallow, or partly disallow, the claim. I accordingly indicated in my oral reasons that any impediment to Clone’s ability to justify the times in its costs claim could not be sheeted home to Players, notwithstanding that the latter was ultimately unsuccessful in defending the proceedings. The second issue raised by Clone was that on a taxation and pursuant to UCR 195.8(2), a Taxing Officer is not bound by the rules of evidence. Players did not dispute this contention, and I accepted it. However, notwithstanding this proposition, as a matter of logic there has to be some evidence in support of each and every attendance claimed by a party in its Schedule of Costs, and each item has to be dealt with on its merits.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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