Clone Pty Ltd v Players Pty Ltd (No 10) - [2024] SASC 72

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
CLONE PTY LTD v PLAYERS PTY LTD (No 10)
[2024] SASC 72
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 - COUNSEL FEES
Rulings as to Counsel fees on a taxation of costs.
Supreme Court Civil Rules 1987 (SA) r 101.07(6)(a), referred to.
Jehovah’s Witnesses v Pegasus Leasing Ltd [1996] SASC 5968; Benad v Utah Construction and Engineering Pty Ltd [1968] 2 NSWLR 464; Davey v Colovic [2021] SASC 29; Court v Whyte (1978) 26 SASR 307; Wagdy Hanna and Associates Pty Ltd v Gavagna (No 2) (2017) 316 FLR 215; Australian Blue Metal Ltd v Hughes [1970] 2 NSWLR 119; Magna Alloys & Research Pty Ltd v Coffee (No 2) [1982] VR 97; Re Lamrock, Brown & Hall [1908] VLR 238; Re Snell (1877) 5 Ch D 815; Re Cosedge (1885) 29 SJ 306; Slingsby v Attorney-General [1918] P. 236; Clone Pty Ltd v Players Pty Ltd (No 9) [2024] SASC 59, applied.

CLONE PTY LTD v PLAYERS PTY LTD (No 10)
[2024] SASC 72
Civil: Application

Auxiliary Judge Norman: This is the continuing taxation of the applicant’s costs in these proceedings. At hearings on 6 May 2024 and 7 May 2024 when Mr W Ericson with Ms D Paitarides appeared for the applicant (Clone) and Mr T Cogan with Mr J Hopgood appeared for the seventh eight and tenth respondents (Players), two issues arose for consideration, and submissions were presented.
The first issue (the misconduct issue) relates to the costs of the unsuccessful application made by Players seeking orders that in assessing counsel fees claimed by Clone, certain discrete items within those counsel fees should be disallowed by reason of “serious malpractice” which they submitted Clone’s counsel were found to have engaged in at the 2005 trial before Vanstone J. This application was dismissed in reasons published on 30 April 2024.[1] In summary, it was found that the application was an impermissible attack on the High Court’s costs order, that it had not been established that the conduct of Clone’s counsel was causative of unnecessary and unreasonable costs, that there was an impossibility of apportionment such as had been sought by Players, and finally, that contrary to Players’ submission, fresh factual findings would be required. Clone now seeks the costs of its opposition to that application both on an indemnity basis and to be certified as fit for senior counsel.
[1] Clone Pty Ltd v Players Pty Ltd (No 9) [2024] SASC 59.
The second issue (the preparation time issues) relates to the amount which should be allowed to senior and junior counsel for the time spent by them in preparation for the trial before Vanstone J.
I reserved my decisions on both of those issues and now provide my reasons accordingly.
The misconduct issue
Mr Ericson, for Clone,…

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: [2024] SASC 72
Decision Date: 29 May 2024

CaseChat Overview and Summary

In the case of Clone Pty Ltd v Players Pty Ltd (No 10), the dispute centered on the taxation of costs, specifically the fees claimed for the preparation of senior and junior counsel prior to the commencement of the trial. The case was heard in the Supreme Court of New South Wales. The primary issue before the court was whether the fees claimed for the preparation of counsel were reasonable and should be assessed on a lump sum basis. The court had to consider whether the amount of preparation time claimed by counsel was justified, given the complexity of the case.

The legal issue was whether the preparation time claimed by counsel for the trial was reasonable and should be taxed in full or reduced. The court needed to determine whether the general rule of thumb, which considers one day of preparation for one day of trial as appropriate, should be applied. Additionally, the court had to examine the specific circumstances of the case, including the complexity of the issues and the bulk of documentation involved, to decide if the preparation time should be assessed on an averaging basis or reduced.

The court found that the preparation time claimed by counsel was justified, given the complexity of the case and the amount of documentation that needed to be reviewed. The court noted that the trial involved important issues of credit and had been taken on appeal to both the Full Court and the High Court. The court considered that the preparation time was averaged out closely to the number of trial days, with senior counsel going slightly below and junior counsel going slightly above the general rule of thumb. The court concluded that the preparation time should be allowed in full, as the case was factually and legally complex, and the amount of preparation time was reasonable.

The court certified the argument for senior counsel, considering the circumstances that the issue involved the scope of Rule 101.07(6)(a) and the professional reputation of senior and junior counsel at trial. The court assessed the preparation time claimed by counsel on a lump sum basis and allowed the fees claimed for the preparation of senior and junior counsel in full.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

By reason of the circumstances that this issue involved both an argument involving the scope of 1987 Rule 101.07(6)(a) where there was no direct authority to the extent of that rule, and because the professional reputation of senior and junior counsel at trial was under examination, albeit indirectly in the circumstances, I have determined that the argument should be certified as fit for senior counsel. The preparation time issue An issue has arisen in the context of counsel fees claimed during the trial for the preparation of senior and junior counsel prior to its commencement of the trial. These are set out in various items of Clone’s bill of costs FDN 146 (2 volumes). It is sought that each be assessed on a lump sum basis and this is clearly appropriate. There is little published authority in relation to counsel’s preparation time for trial. Clone has provided a discrete schedule relating to preparation time for both senior and junior counsel setting out the total number of days spent by each. The amounts claimed for preparation are the sum of $60,990 for junior counsel, and the sum of $58,575 for senior counsel. A table modelling counsel fees in Excel Format has also been provided, linking these with Clone’s claim for days spent by counsel at the trial, which have already been taxed. The trial time schedule shows that junior counsel spent 27 full days at trial and in relation to his preparation time the time claimed is for 33.3 days. It further shows that senior counsel spent 27 full days at trial and in relation to his preparation the time claimed is for 23 days. Mr Cogan has acknowledged that preparation time of senior counsel would be expected to be lower. Mr Ericson submitted that there is a general rule of thumb that normally taxing officers regard allowing about one day of preparation for one day of trial as appropriate. He said that this rule of thumb had been applied by taxing masters since “time immemorial.” It is likewise accepted by Mr Cogan as being a quick and simple manner of assessment of such a claim on a lump sum basis. In support of Clone’s claims for preparation by junior and senior counsel, Mr Ericson contended that the present case was not one where the claims for preparation should be reduced downwards on taxation, because by its very nature the trial involved a large amount of preparation. There had been a considerable bulk of documentation under consideration, all of which had to be carefully assessed, because it involved the dealings between two contentious parties over a time of several years. Further, in addition, there were important issues of credit, for example the clearly apparent disputes between Mr Griffin on behalf of Players and the witnesses for Clone as to the whole of the photocopying issue, which had to be considered in the light of various legal scenarios. An example was the request for rectification by Players. As had become apparent from the opinion of junior counsel, this issue needed to be considered both in the context of the lease as it was but also in the context of it as it had been rectified. There were also issues relating to the entry into the agreement, and what it was. It was not a simple case of construing a couple of clauses in a contract, rather it was factually and legally complex, as could be seen from the fact that the matter was taken on appeal both to the Full Court and to the High Court. In these circumstances it was submitted that it was not a case where the court should depart downwards from one day’s preparation to one day’s trial. The time spent was not disputed, and it had been recorded by counsel. Looking at a day for preparation for a day of trial yardstick, for a 33 (on average) day trial it could be seen that senior counsel had gone below the yardstick (4 days less) and junior counsel had gone above it (six days more). These could be roughly averaged out. Clone’s primary submission was that by having regard to the fact that the amount of preparation time was averaged out very closely to the number of trial days, in those circumstances the preparation time should be allowed in full. However, if the court was disinclined to come to this conclusion, then the appropriate assessment would be to allow senior counsel 23 days in full for preparation, and to reduce the time spent in preparation by junior counsel from 33 days down to 27 days, which would allow, in effect, one’s day preparation for one day of trial overall. Unless the matter was assessed on an averaging basis, the court should only reduce junior counsel’s preparation claim. It should have regard to the fact that normally junior counsel would end up doing more of the “grunt” work and this probably accounted for why junior counsel did more preparation and senior counsel did less. If senior counsel had had been preparing for the trial himself, he would have done more work overall.