Clone Pty Ltd v Players Pty Ltd (No 7) - [2023] SASC 98

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
CLONE PTY LTD v PLAYERS PTY LTD (No 7)
[2023] SASC 98
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 - SOLICITOR'S PROFIT COSTS - ATTENDANCES
Rulings on a Taxation of costs.
District Court Civil Rules 2006 (SA) r 264(2); Uniform Civil Rules 2020 (SA) r 194.6, referred to.
Lawrence v MD Nikolaidis & Co (2003) 57 NSWLR 355; [2003] NSWCA 129 at [50] – [51], per Hodgson JA; Auspine Ltd v Australian Newsprint Mills Ltd (1999) 93 FCR 1; [1999] FCA 673, at [25], per O’Loughlin J; Hudspeth v Scholastic Cleaning and Consultancy Services Pty Ltd & Ors (No 8) [2014] VSC 567 at [167], per Dixon J; Prudential Finance Ltd v Davander Nominees Pty Ltd [1992] 1 VR 468; Woodward v David Jones Pty Ltd & Ors District Court Action 2590 of 2011, decision no. 7 of 2018, reasons published 27 February 2018 (unreported).; Smith v Bullar [1875] LR 19 Eq 473 at 475; Coleman v Waldron (1980) LSJS 447, per Wells J; Fitzroy Robinson Ltd v Mentmore Towers Ltd [2009] EWHC 1552 (TCC); Clone Pty Ltd v Players Pty Ltd (No 6) [2023] SASC 56; Kuek v Devflan Pty Ltd & Anor [2009] VSC 91, at [25] and [41] – [42], per Beach J; McCoombes v Curragh Queensland Mining Ltd [2001] QDC 142, considered.

CLONE PTY LTD v PLAYERS PTY LTD (No 7)
[2023] SASC 98
Supreme Court – Civil Application

NORMAN AJ: This is the continuing taxation of the costs of the applicant Clone Pty Ltd in these proceedings. In these reasons the applicant will be referred to as “Clone” and the respondents 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 completed on 29 June 2021; however, large numbers of items were reserved. The remaining items have since been grouped into discrete topics, and these are now being taxed in progression.
Three issues have recently been argued:
·The first relates the preparation of a solicitor for conferences with and/or the proofing of witnesses.
·The second relates to the attendances in court of an instructing solicitor.
·The third relates to the attendances in court of a senior clerk.
Preparation for conferences/ Proofing
Clone has claimed for the preparations by its solicitor, Ms Karagiannis, relating to a conference/conference with its potential witnesses Mr Mead, Mr Brooks and Mr Lawry (sometimes called Laury). The relevant items are as follows:
·Item 3149 - 24 November 2004 – Attendance by Ms Karagiannis to cross reference chronological documents and attendance of Ms Karagiannis to review documents to prepare for conference with Mr Mead, Mr…

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: [2023] SASC 98
Decision Date: 23 June 2023

CaseChat Overview and Summary

The case of Clone Pty Ltd v Players Pty Ltd (No 7) dealt with the taxation of costs within the context of civil proceedings in the state courts of Australia. The central dispute focused on specific claims made by Clone Pty Ltd regarding the costs incurred by their solicitor, Ms Karagiannis, for preparing for conferences with potential witnesses and the attendance of various legal professionals in court. The issues before the court involved the legitimacy of costs related to the preparation for conferences, the attendance of an instructing solicitor, and the attendance of a senior clerk in court.

The primary legal issues revolved around the interpretation and application of the Tenth Schedule to the 1987 Supreme Court Rules, particularly scale items [7] and [8], which set forth the permissible hourly rates for solicitor's attendance. Clone Pty Ltd argued for the inclusion of certain preparatory activities in their costs, while Players Pty Ltd contested these claims, asserting that some of the activities were either redundant or not sufficiently justified to warrant the claimed costs. The court had to determine whether the preparation for conferences, including reviewing documents and cross-referencing materials, constituted allowable costs under the prevailing rules.

The court meticulously examined the submissions and evidence presented by both parties. It found that the costs claimed for the preparation of conferences and the proofing of witnesses were not permissible under the standard costs basis. The court reasoned that if a solicitor had already claimed for the perusal of documents, additional charges for reviewing these same documents in preparation for a conference were redundant and not allowable. Furthermore, the court held that the attendance of an instructing solicitor in court was not necessary unless there was a compelling reason to justify it, and the costs associated with such attendance should be scrutinized. The attendance of a senior clerk was also subject to strict scrutiny, with the court holding that such attendance should only be claimed if it was essential and directly contributed to the proceedings.

The court's decision resulted in the disallowance of the contested costs, significantly reducing the amount that Clone Pty Ltd could recover from Players Pty Ltd. The final orders reflected the court's determination, disallowing the claims for the preparation of conferences and certain attendances, thereby resolving the dispute in favor of Players Pty Ltd.

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

Three issues have recently been argued:·The first relates the preparation of a solicitor for conferences with and/or the proofing of witnesses.·The second relates to the attendances in court of an instructing solicitor.·The third relates to the attendances in court of a senior clerk.Preparation for conferences/ Proofing Clone has claimed for the preparations by its solicitor, Ms Karagiannis, relating to a conference/conference with its potential witnesses Mr Mead, Mr Brooks and Mr Lawry (sometimes called Laury). The relevant items are as follows:·Item 3149 - 24 November 2004 – Attendance by Ms Karagiannis to cross reference chronological documents and attendance of Ms Karagiannis to review documents to prepare for conference with Mr Mead, Mr Brooks and Laury (3.1 hours) [7] amount $775.·Item 3153 - 26 November 2004 – Attendance by Ms Karagiannis to go through chronology and sub chronologies, cross reference chronological documents and prepare for conference with Mr Lawry and Mr Mead (4.1 hours) [7] amount $1,025.·Item 3405 - 19 January 2005 – Attendance by Ms Karagiannis to review documents in light of counsel instructions and in preparation for conference with B Mead (2.2 hours) [7] amount $550. The total amount claimed in respect to these three attendances is $2,350. This is based on scale item [7] of the Tenth Schedule to the then 1987 Supreme Court Rules (“the Tenth Schedule”) which was in force between 29 April 2004 and 13 July 2005, being an hourly rate of $250. An alternative rate allowed in the Tenth Schedule is item [8] which provides that where the attendance of a solicitor does not require special skill or legal knowledge but where it is proper that a solicitor should personally attend, including travelling time, an hourly rate of $154 is allowed. In essence, the issue in dispute is whether as between party and party (now referred to as the standard costs basis pursuant to Uniform Civil Rules (“UCR”) rule 191.1) a solicitor can charge for preparing for a conference with, or proofing of, a witness or witnesses by reviewing materials beforehand such as documents for which perusals have already been claimed, or for cross referencing chronological documents which have already been prepared. There appears to be little authority on this issue, both in South Australia and in other jurisdictions, although no doubt the issue has been raised during taxations of costs but where the rulings have not been reported. In the case of item 3149, Mr Ericson, for Clone, tabled a bundle of documents comprising 107 sheets comprising something in the order of 70 A4 pages of text. The first three pages of the bundle comprise handwritten notes dated 24 November 2004 being the date of Item 3149 of the claim, and these appear to be the notes made by Ms Karagiannis in cross referencing the chronological documents viewed by her on that date. The remaining documents appear to be those discovered by the parties during the proceedings. No supporting material has been provided in relation to Items 3153 and 3405.Submissions of the parties