Clone Pty Ltd v Players Pty Ltd (No 8)

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
CLONE PTY LTD v PLAYERS PTY LTD (No 8)
[2023] SASC 160
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.
Uniform Civil Rules 2020 (SA) r 195.8(2), referred to.
Clone Pty Ltd v Players Pty Ltd [2022] SASC 51, considered.

CLONE PTY LTD v PLAYERS PTY LTD (No 8)
[2023] SASC 160
Civil: Application
Auxiliary Judge Norman
Background

This is the continuing taxation of the applicant’s costs in these proceedings. At the hearing on 22 August 2023 two issues arose for consideration and were argued by counsel. I reserved my decision on these issues.
The first concerned seven claims included in Clone’s Schedule of Costs which referred to the engrossment by its solicitors of documents dictated by counsel for use when summarising evidence during the trial.
The second concerned a disbursement claimed in item 4851 of Clone’s Schedule of Costs being a claim of the firm of Connell Mott MacDonald for the preparation of its employees Mr Kennedy and Mr Belperio in giving their evidence at the trial.
Claims for engrossment of summaries prepared by Counsel
These claims are as follows.
Item 5294 claims the sum of $56 the engrossment of a four-page document entitled “McDermott’s evidence” dictated by counsel and for use in summarising evidence at trial.
Item 5295 claims the sum of $161 with the engrossment of 11.5 pages of a document entitled “Summary of the evidence of Griffin” dictated by counsel and for use in summarising evidence at trial.
Item 5296 claims the sum of $42 for the engrossment of a three-page document entitled “Summary of evidence of Peter Grope” dictated by counsel and for use in summarising evidence at trial.
Item 5331 claims the sum of $140 for the engrossment of a 10-page document entitled “Credit of Griffin” dictated by counsel and for use when preparing closing submissions.
Item 5332 claims the sum of $70 for the engrossment of a five-page document being submissions to be put by the plaintiff, dictated by counsel.
Item 5333 claims the sum of $182 for the engrossment of a 13-page document entitled “Rectification” dictated by counsel and for use when preparing closing submissions.
Item 5334 claims the sum of $336 for engrossing a 24-page document entitled “Consent – the letter of 30 October” dictated by counsel and for use when preparing closing submissions.
Although the fact of engrossment of the documents, and the length of each is not in dispute - as they are extant and are on the files of Clone’s solicitors - the question in dispute is whether these documents were engrossed by counsel, on the one hand, or by Clone’s solicitors, on the other.
Clone’s Schedule of Costs asserts by reason of the wording of each claim that the documents were engrossed by its solicitors at that time, Grope Hamilton Lawyers. However, the evidence to support this assertion appears to be tenuous, because there is no affidavit or oral evidence to this effect, there is no specific reference in the Work in Progress records of Grope Hamilton to verify this, nor have any independent file notes been produced to the Court in support of those claims.
Recognising this, Clone’s present solicitors, Finlaysons Lawyers, wrote on 24 January 2023 to its senior counsel at trial, Mr Philip McNamara (then) QC, and its junior counsel, Mr Arturo Dal Cin in the following terms:
… there has been some dispute during the taxation as to the “engrossing” of several documents. It is alleged by Clone that several documents drafted during the trial were dictated by counsel but “engrossed” by the solicitors for Clone. Recognising that a substantial period of time has passed since the original trial, we would appreciate if you would please let us know whether:
1. You have any recollection as to instances where you dictated a document and it was engrossed by one of Clone’s former lawyers;
2. At the time, you had a practice of dictating documents and having them engrossed by your instructors. Perhaps during conference.
Counsel responded to these enquiries. Mr McNamara wrote on 24 January 2023:
I refer to your letter of even date.
As to your first question, I no longer possess any documents relating to my retainer by your client in relation to the 2005 trial.
As to your second question, “engrossing”:
1. I have no specific recollection of dictating a document, or the draft of a document, to a partner or employed solicitor of Grope Hamilton in relation to the Clone matter.
2. Yes, it was a common practice of mine, in and prior to 2005, to dictate documents to instructing solicitors, either in conference or before or after court, on the footing that those documents would be subsequently be engrossed by an instructor and then either filed, or sent to an opponent or third party, as the case may be. For example, as you will know from your own experience, counsel may be asked to formulate and dictate a pleading, or an amended pleading, affidavit, or a Notice of Subpoena, or a letter to an opponent or to a third party.
It is more likely that, if this occurred in the Clone matter, junior counsel, rather than I, would have dictated documents to our instructors before and during the 2005 trial, possibly after consultation with me.
I therefore take it that you have made a corresponding enquiry of junior counsel.
If you can identify from the Grope Hamilton files any specific instances of “engrossing”, and if you can identify and arm me with a file note relating to such engrossing, or a transcription of any such file note, which identifies the date and subject matter of such “engrossing”, that may very well prompt my memory. However, at the moment, my memory is a complete blank on the topics raised by your letter.
I regret that I am not able to be of any help to you.
Mr Dal Cin, likewise, in his response was unable to recollect whether he had engrossed the documents in question or whether they had been engrossed by Grope Hamilton Lawyers.
No record has been produced by Clone evidencing that the documents in question had been forwarded by solicitors to counsel, or the other way around, which might shed light on the issue of by whom they were engrossed.
Mr Cogan, for the Players parties, submitted that the absence of any records suggested that the engrossment was not undertaken by the solicitors. In the absence of a record, he submitted, the Court could not be satisfied as to what in fact had occurred and accordingly Clone, having the onus of proof relating to its claim for costs, had not overcome this onus.
A claiming party for costs has the onus of substantiating its claim for each item in its Schedule of Costs whether this be by way of oral or affidavit evidence, or by the production of a document or documents such as work in progress or file notes in this regard. Uniform Civil Rule 195.8(2) provides that a taxing officer in undertaking a taxation is not bound by the rules of evidence and may decide questions by estimation or by any other expeditious means. The process is relatively informal and summary in nature, and where there is an absence of documents, such as file notes, the taxing officer can consider the surrounding circumstances and his or her experience of litigation in drawing inferences as to the reasonableness of a costs item and the appropriate quantum. However, as I held in Clone Pty Ltd v Players Pty Ltd [2022] SASC 51 at [24], although it is acknowledged that on a taxation and pursuant to UCR 195.8(2) a taxing officer is not bound by the rules of evidence, as a matter of logic there must be some evidence in support of any proposition put by a party.
Mr Ericson in support of Clone’s claims referred to oblique inferences which might be drawn from other material he referred to, but as Mr Cogan submitted in reply this was equivocal and could not be relied upon. I accept this submission.
What remains is that Mr McNamara has written that it was his common practice, in and prior to 2005, to dictate documents to instructing solicitors, either in conference or before or after court, on the footing that those documents would be subsequently be engrossed by an instructor. However, the fact remains that there is no evidence on Clone’s files, nor has anything been produced by its counsel, to suggest that any material comprising the items in dispute was either forwarded by Clone’s counsel, nor received by Grope Hamilton Lawyers. Nor is there any Work in Progress record kept by Grope Hamilton, or anything marked on the documents themselves, to verify such engrossment by that firm.
At best, the evidence is equivocal. If the fact is that the documents were engrossed by Counsel, their remuneration would be included either directly or indirectly within their fees, so were the Court to now allow the claims by Grope Hamilton, payment for same would necessarily be imposed twice.
In the circumstances, the claims for Items 5294, 5295, 5296, 5331, 5332, 5333, and 5334 of Clone’s Schedule of Costs are disallowed.
Item 4851 – disbursement claim by Connell Mott MacDonald for assisting as trial witnesses for the plaintiff re statements
This claim seeks payment of a disbursement of $12,163.25 including GST (or $11,057.50 GST free). It relates to the preparation by witnesses Mr Ralph Belperio and Mr David Kennedy for the applicant of statements, and liason with Grope Hamilton, charged on an hourly basis from 22 January 2005 to 25 March 2005 concerning the evidence they would give. The tax invoice produced to the Court indicates a breakdown of 27.5 hours for Mr Belperio, an Associate, at $225 per hour totalling $6,187.50, 30 hours for Mr Kennedy, an experienced engineer, at $130 per hour, three hours for a Principal, Mr C Michelmore at $300 per hour, and Administration of one hour at $70 per hour. Both Mr Belperio and Mr Kennedy gave evidence.
It is noted that two previous accounts of Connell Mott MacDonald have already been allowed, namely item 2864 in the sum of $5,808 (allowed at $5,280.00, $528 being taxed off relating to a GST component) and item 3409 in the sum of $1,812.25 (allowed at $1,647.00, $164.75 being taxed off), a total of $6,927.00 being awarded. These covered the period before 22 January 2005.
If allowed in full, the total recoverable by Connell Mott MacDonald, including the amounts already awarded, would be the sum of $19,090.25.
Supporting documentation has been produced by Clone, including a copy of the account, correspondence with the firm, reports of Connell Mott MacDonald dated 1 October 2004 and 15 March 2005, a 14-page statement of Mr Belperio dated 23 December 2004, a Supplementary Report of Mr Belperio dated March 2005, a 32-page transcript of Mr Belperio’s evidence at trial, a seven-page statement of Mr Kennedy dated July 2004, and a 125-page transcript of Mr Kennedy’s evidence at trial.
Noting that this claim relates to work undertaken since 22 January 2005, the (substantial) report of 1 October 2004 and the statements of both Mr Belperio and Mr Kennedy will not be covered by this tax invoice.
However, it will include the cost of the report of 15 March 2005 (three pages), various telephone attendances by the solicitors on Mr Kennedy (items 3852, 4521, 4607, 4655 and 4656) and with Mr Belperio (items 3467, 3596, 3615, 3826, 3837, 4108, 4215, 4558, 4560 and 4787), and the time spent by these experts in giving evidence.
Clearly both witnesses, who were professional experts, were necessary and proper witnesses, and they both gave evidence in the matter.
Even allowing for the time spent by both witnesses in giving evidence, which I am informed was approximately 18 hours, it seems to me to be inappropriate that anything approaching 57 hours in total should be allowed for their attendances during this period. The statements of both Mr Belperio and Mr Kennedy had already been prepared, as had the lengthy first report dated 1 October 2004, and other than the preparation of the supplementary statement of 15 March 2005, and the telephone attendances referred to above, there is scant evidence of what was otherwise undertaken during the hours claimed. No breakdown has been provided in the tax invoice, nor has any other analysis of the time spent by these experts been made available.
The best that I can do is to assess the claim on a “broad axe” basis. I allow the sum of $5,000 (nett of GST) for this item, and $7,163.25 is taxed off.
In accordance with these rulings, Clone’s Schedule of Costs has been marked accordingly.
Rulings
1.The claims for items 5294, 5295, 5296, 5331, 5332, 5333, and 5334 of Clone’s Schedule of Costs are disallowed.
2.The sum of $7,163.25 is taxed off item 4851 of Clone’s Schedule of Costs.
.

[2023] SASC 160

7 November 2023