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COMPUTER ACCOUNTING AND TAX PTY LTD -v- PROFESSIONAL SERVICES OF AUSTRALIA PTY LTD [2008] WASC 133 (S)

Link to Appeal :
[2009] WASCA 183 [2009] WASCA 183(S) [2011] WASCA 80

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2008] WASC 133 (S)
Case No:	CIV:2265/2006	Heard:	2, 5 - 9, 28 NOVEMBER, 3, 5, 10 DECEMBER 2007, 29 FEBRUARY, 17 DECEMBER 2008, 6 APRIL 2009
Coram:	SIMMONDS J	Delivered:	9/07/08
Supplementary Delivered:	6/05/09
No of pages:	51	Judgment Part:	1 of 1
Result:	Certain costs orders made
Category:	B
PDF Version

Parties:	COMPUTER ACCOUNTING AND TAX PTY LTD PROFESSIONAL SERVICES OF AUSTRALIA PTY LTD MARTIN PAUL BANNING
Catchwords:	Costs of action Approach to be adopted where more than one cause of action and plaintiff largely but not entirely successful Costs ordered as percentage Reserved costs Orders made for some but not all such costs Application for certain costs of Magistrates Court proceedings Certificate for costs of transcript Whether provision should be made for only a proportion of such costs on basis costs should be shared by the parties Special costs orders Jurisdiction under Legal Practice Act 2003 (WA) s 215(2) Approach to be adopted to exercise of jurisdiction Some but not all orders applied for made Practice and procedure Leave to re-open consideration of matter after hearing but before delivery of judgment Fresh evidence Costs of this application Approach to be adopted Order for costs in the cause
Legislation:	Copyright Act 1968 (Cth), s 43 District Court Act of Western Australia Act 1969 (WA), s 78(a) Legal Practice Act 2003 (WA), s 215 Rules of the Supreme Court 1971 (WA), O 66 r 1(1), O 66 r 12(1) Sentencing Act 1995 (WA), s 89(1)
Case References:	Cazaly Iron Pty Ltd v Minister for Resources [No 5] [2008] WASCA 181 Computer Accounting & Tax Pty Ltd v Professional Services of Australia Ltd [2008] WASC 133 EDWF Holdings 1 Pty Ltd v EDWF Holdings 2 Pty Ltd [2008] WASC 275 (S) Esther Investments Pty Ltd v Markalinga Pty Ltd (1992) 8 WAR 400 Flotilla Nominees Pty Ltd v Western Australian Land Authority [2003] WASC 122 (S) Green v Wilden Pty Ltd [2005] WASC 83 (S) Heartlink v Jones as Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254 (S) Hodgkinson v Doepel & Associates Architects Pty Ltd [2006] WASC 237 (S) JH Lever & Co Pty Ltd v Maniotis [2006] FCA 1668 Keen v Telstra Corp Ltd [2006] FCA 834 Mackenzie v Albany Finance Ltd [2003] WASC 100 (S) Moody v French [2008] WASCA 67 Osborne v Landpower Developments Pty Ltd (in liq) [2003] WASCA 117 Permanent Building Society v Wheeler (1993) 10 WAR 569 Phillips Fox v Westgold Resources NL [2000] WASCA 85 Scherer v Counting Instruments Ltd [1986] 2 All ER 529 SDS Corporation Ltd v Pasdonnay Pty Ltd [2004] WASC 26 (S2) Verdell Pty Ltd v F & G Nominees Pty Ltd [2002] WASC 58 (S2)

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION : COMPUTER ACCOUNTING AND TAX PTY LTD -v- PROFESSIONAL SERVICES OF AUSTRALIA PTY LTD [2008] WASC 133 (S) CORAM : SIMMONDS J HEARD : 2, 5 - 9, 28 NOVEMBER, 3, 5, 10 DECEMBER 2007, 29 FEBRUARY, 17 DECEMBER 2008, 6 APRIL 2009 DELIVERED : 9 JULY 2008 SUPPLEMENTARY
DECISION : 6 MAY 2009 FILE NO/S : CIV 2265 of 2006 BETWEEN : COMPUTER ACCOUNTING AND TAX PTY LTD

Plaintiff

AND

PROFESSIONAL SERVICES OF AUSTRALIA PTY LTD

First Defendant

MARTIN PAUL BANNING

Second Defendant

(Page 2)

Catchwords:

Costs of action - Approach to be adopted where more than one cause of action and plaintiff largely but not entirely successful - Costs ordered as percentage

Reserved costs - Orders made for some but not all such costs - Application for certain costs of Magistrates Court proceedings

Certificate for costs of transcript - Whether provision should be made for only a proportion of such costs on basis costs should be shared by the parties

Special costs orders - Jurisdiction under Legal Practice Act 2003 (WA) s 215(2) - Approach to be adopted to exercise of jurisdiction - Some but not all orders applied for made

Practice and procedure - Leave to re-open consideration of matter after hearing but before delivery of judgment - Fresh evidence

Costs of this application - Approach to be adopted - Order for costs in the cause

Legislation:

Copyright Act 1968 (Cth), s 43

District Court Act of Western Australia Act 1969 (WA), s 78(a)
Legal Practice Act 2003 (WA), s 215
Rules of the Supreme Court 1971 (WA), O 66 r 1(1), O 66 r 12(1)
Sentencing Act 1995 (WA), s 89(1)

Result:

Certain costs orders made

Category: B

(Page 3)

Representation:

Counsel:

Plaintiff : Mr C P Stokes

First Defendant : Mr S V Forbes

Second Defendant : Mr S V Forbes

Solicitors:

Plaintiff : Chris Stokes & Associates

First Defendant : Eastwood Law

Second Defendant : Eastwood Law

Case(s) referred to in judgment(s):

Cazaly Iron Pty Ltd v Minister for Resources [No 5] [2008] WASCA 181
Computer Accounting & Tax Pty Ltd v Professional Services of Australia Ltd [2008] WASC 133
EDWF Holdings 1 Pty Ltd v EDWF Holdings 2 Pty Ltd [2008] WASC 275 (S)
Esther Investments Pty Ltd v Markalinga Pty Ltd (1992) 8 WAR 400
Flotilla Nominees Pty Ltd v Western Australian Land Authority [2003] WASC 122 (S)
Green v Wilden Pty Ltd [2005] WASC 83 (S)
Heartlink v Jones as Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254 (S)
Hodgkinson v Doepel & Associates Architects Pty Ltd [2006] WASC 237 (S)
JH Lever & Co Pty Ltd v Maniotis [2006] FCA 1668
Keen v Telstra Corp Ltd [2006] FCA 834
Mackenzie v Albany Finance Ltd [2003] WASC 100 (S)
Moody v French [2008] WASCA 67
Osborne v Landpower Developments Pty Ltd (in liq) [2003] WASCA 117
Permanent Building Society v Wheeler (1993) 10 WAR 569
Phillips Fox v Westgold Resources NL [2000] WASCA 85
Scherer v Counting Instruments Ltd [1986] 2 All ER 529
SDS Corporation Ltd v Pasdonnay Pty Ltd [2004] WASC 26 (S2)
Verdell Pty Ltd v F & G Nominees Pty Ltd [2002] WASC 58 (S2)

(Page 4)

SIMMONDS J

Introduction

1 This is an application by the plaintiff for orders as to costs following judgment in the trial of this action. That judgment was Computer Accounting & Tax Pty Ltd v Professional Services of Australia Ltd [2008] WASC 133. The orders on judgment dated 9 July 2008 provided for this application.

2 The application canvasses a range of matters, being the liability for the costs of the action; costs of the transcript of the trial and other hearings; certain reserved costs; and special costs orders to uplift the maximum allowances under certain items in the relevant costs determination of the court.

3 I deal with those matters in that order.

4 However, before doing so, I provide a short account of the procedural history of this action. That history is of a lengthy and fairly complicated kind, and has some importance to a number of the orders sought by the plaintiff.

5 In addition, I refer to a hearing to consider further material of which the defendants had become aware following the hearing on 17 December 2008 of the plaintiff's application.

Procedural history

6 I describe the character of the action in very basic form here; I go into that character in more detail in the next section of these reasons. In this section I am concerned rather to refer to the major procedural steps taken in the action.

7 I draw for this account on Computing Accounting & Tax [8] - [12] and [106], with a correction for the number of days of the trial, which ran over 11 days, including the last day given over to closing submissions, not 12 days with that inclusion, as shown in the judgment.

8 These proceedings have their origin in proceedings in the Local Court. Those proceedings were No 17065 of 2003, commenced by summons on 17 September 2003. Those proceedings were a claim by the plaintiff, and its two directors and shareholders, Hartmut Huber Josef Frigger (Mr Frigger) and Angela Cecilia Theresa Frigger (Mrs Frigger), against the first defendant and against Martin Paul Banning (Mr Banning,

(Page 5)

now deceased) for loss incurred in the purchase of a property in Armadale (the Armadale property), then leased as a service station and an automotive workshop, as a result of misleading or deceptive conduct. Substituted particulars of claim and amended substituted particulars of claim prepared by solicitors subsequently engaged by the plaintiff were later filed in those proceedings.

9 On 9 July 2004 an order was made in the Local Court granting leave for Mr and Mrs Frigger to have themselves removed as plaintiffs in the proceedings.

10 By order of 14 November 2005, the proceedings, in the Perth Magistrates Court as the relevant Local Court had by then become, were transferred into the District Court. The District Court proceedings were initially CIV 332 of 2004 but became CIV 2797 of 2005. A statement of claim was filed in those proceedings.

11 Still later, by order made by consent on 17 November 2006, following an unsuccessful attempt to have the proceedings transferred into the Federal Court, the District Court proceedings were transferred into this court, to become CIV 2265 of 2006 (the present proceedings).

12 The pleadings at the time of trial comprised a further further re-amended statement of claim filed on 7 November 2007 which was the result of leave to amend that was granted on the second day of the trial (the statement of claim), further amended defence to further re-amended statement of claim (the defence), and the plaintiff's amended substituted reply, which was the result of leave to substitute granted on the seventh day of the trial (the reply).

13 On 9 July 2008 judgment was delivered in the action. Mr Banning died after that delivery, and the present second defendant was substituted for him by order yet to be extracted. I will from now on when referring to the 'defendants' subsume by that term the first defendant and both second defendants.

14 Initially in the Magistrates Court the plaintiffs were self-represented. Subsequently, the plaintiff retained four different firms of solicitors of record.

The further hearing of the plaintiff's application

15 The plaintiff's application as to costs was initially heard on 17 December 2008.

(Page 6)

16 On 20 January 2009, counsel for the defendants, in the course of counsel's representation of another person, became aware of certain matters. He became aware of them as a result of inspection on a discovery in proceedings which had been instituted against the person he represented by Mr and Mrs Frigger. The plaintiff in the present action had been substituted as plaintiff in those proceedings. They were Magistrates Court No 5093 of 2008. They arose out of the representation of the plaintiff in what became the present action. The matters of which counsel became aware were contained in an invoice for counsel fees (the fresh evidence) of the then counsel for the plaintiff in the present action. Those matters included the amount charged per day by counsel for the first six days of the trial in the present action. Special costs orders are sought by the plaintiff in respect of counsel fees paid for those days, among others.

17 On 17 February 2009 at a hearing before me I was informed of the commencement by originating summons of proceedings in this court in CIV 1216 of 2009. Those proceedings were to have counsel for the defendants relieved of the implied undertaking in respect of the discovery in Magistrates Court No 5093 of 2008. That relief was sought for the purposes of disclosing the fresh evidence to me and to the solicitors for the defendants in the present action. I agreed to allow time for the proceedings in CIV 1216 of 2009 to be determined.

18 By chamber summons filed 6 March 2009 the defendants sought an order that the delivery of judgment on the plaintiff's costs application be stayed until further order.

19 On 12 March 2009 Le Miere J made orders in CIV 1216 of 2009 in terms of the originating summons in those proceedings.

20 On 16 March 2009 following a hearing before me I made orders that delivery of judgment on the plaintiff's costs application would be stayed until a hearing had taken place to consider the fresh evidence and reserved the costs of the defendants' application by chambers summons of 6 March 2009.

21 On 6 April 2009 the hearing called for by the orders of 16 March 2009 took place.

22 I consider below the fresh evidence and related matters.

(Page 7)

Costs of the action

23 The plaintiff's 'Minute of Proposed Orders on Special Costs Application' filed 28 October 2008 (the plaintiff's minute) seeks an order the defendants pay the plaintiff's costs of the action, to be taxed.

24 The defendants' 'Minute of Proposed Costs Orders' filed 12 December 2008 seeks an order that the defendants pay 70% of the plaintiff's costs of the action to be taxed 'in accordance with the applicable Courts' determinations'.

25 To provide the background to these competing orders, I must first describe the nature of the action in more detail, the issues canvassed in the judgment and the resolution there of those issues. I will then review the principles that in my view should guide the exercise of my discretion as to costs, before applying those principles.

26 The action as tried was for damages (including aggravated or exemplary damages) in respect of economic loss or damage for representations by the first defendant for which Mr Banning was the maker or in which he was involved. Liability was rested on contraventions of Trade Practices Act 1974 (Cth) s 52 and Fair Trading Act 1987 (WA) s 10, and on negligence and deceit. The economic loss claimed was on the plaintiff's purchase from the first defendant of the Armadale property.

27 The substantive issues in the trial were the following, as described in Computer Accounting & Tax [46]:

The substantive issues in this trial go to whether there were representations that were false or conduct that was misleading as pleaded, whether there was negligence or fraud for the purposes of liability at common law in negligent misstatement or deceit, who was liable for the conduct in question, was there reliance on that conduct, what loss or damage was suffered thereby, whether aggravated or exemplary damages are recoverable, and whether interest should be awarded as claimed.

28 There was one further substantive issue, however. It had to do with the capacity in which the plaintiff had acted at certain material times. I reach it shortly.

29 The decision in Computer Accounting & Tax with respect to the substantive issues save for the further one was as follows.

30 As to the issue whether representations were made or conduct engaged in capable of being misleading or deceptive, I concluded that, of

(Page 8)

the representations or forms of conduct relied upon, most, numbered 1 to 5 in the judgment [187], including the principal representations or forms of conduct relied upon by the plaintiff in the action, were established.

31 As to the issue whether the representations made or forms of conduct engaged in were false or misleading or deceptive, I concluded that, of the five such representations or forms of conduct, all but one were shown to be false or misleading or deceptive.

32 As to the issue whether there was negligence in relation to the representations or forms of conduct engaged in that were false or misleading or deceptive, I concluded a breach of the duty of care in respect of each of them had been shown.

33 As to the issue whether there was awareness or recklessness sufficient for the tort of deceit in respect of all four of these representations or forms of conduct, I concluded this was made out in respect of two of the four.

34 As to the issue who was liable, I concluded both the first defendant and Mr Banning were liable for the four representation or forms of conduct at common law (at least in negligence) and under the Fair Trading Act, and as to the first defendant under the Trade Practices Act, but as to Mr Banning under that statute only in respect of two of the representations made or forms of conduct engaged in.

35 As to the issue whether there was reliance on the four representations made and forms of conduct engaged in, I concluded there was such reliance in all cases.

36 As to the issue of whether there was loss or damage, and of what sorts, I concluded I had insufficient evidence to establish loss of investment opportunity to gain higher rental returns, although I also noted the plaintiff did not press that claim in closing submissions; loss on making the acquisition by paying too much for the Armadale property was made out, albeit at an amount arrived at by adjustment of the amount claimed; and loss of an opportunity to make an advantageous capital investment (capital investment opportunity) was also made out, albeit at an amount arrived at by adjustment of the amount claimed.

37 As to the issue whether aggravated or exemplary damages were recoverable, I concluded they were not.

(Page 9)

38 As to the issue whether interest was recoverable, I concluded that it was.

39 There was a further substantive issue, however, as I have indicated. It was the subject of significant evidence and argument at trial, and produced an amendment of the plaintiff's statement of claim during the trial. It concerned whether the plaintiff had acted at the material times as trustee for the Frigger Super Fund (the superannuation fund of Mr and Mrs Frigger), in which case the defendants' contention was that the plaintiff had suffered no recoverable loss, but rather any such loss suffered was that of the Frigger Super Fund. The matter of whether there was a factual foundation for this contention occupied some considerable trial time, and was resolved against the defendants. Further, I determined that, even had the resolution of the factual issue been otherwise, the defendants' contention would have failed.

40 I turn now to consider the principles in my view relevant to the exercise of my discretion as to the costs of the action.

41 My discretion should 'generally' be exercised to award the successful party its costs: Rules of the Supreme Court 1971 (WA) (SC Rules) O 66 r 1(1).

42 However, O 66 r 2(a) says this:

In the absence of any special order -

(a) where the statement of claim contains more than one cause of action and the plaintiff succeeds on one or more causes of action and the defendant succeeds on another or others, costs shall be allowed to the plaintiff on the cause or causes of action on which he succeeds and to the defendant on that or those on which he succeeds, in the same manner as if separate actions had been brought.

43 In the leading authority on this rule, Permanent Building Society v Wheeler (1993) 10 WAR 569, 572, 574 - 575 (Anderson J), the following appears:

I take 'cause of action' as being a factual situation, the existence of which entitles the plaintiff to obtain the remedy sought against the defendant(s): see

Letang v Cooper

[1965] 1 QB 232 at 242, per Diplock LJ.

…

In my opinion the approach required by the rules of this Court is that, once it is seen that separate causes of action are involved, and that the plaintiff

(Page 10)

has succeeded on only one or some, the defendant is prima facie entitled to his costs on the other or others. However, in my experience, this Court will not make such an order as of course. The court will always look at the realities of the case and attempt to do substantial justice. Thus it may be that, although it is strictly correct to say that different causes of action are involved, there may have been only one contest in substance. This will often be so when all causes of action arise out of the one course of dealings, the one transaction or the same facts. Where that is the situation there will usually be one order for the general costs of the action, moulded as necessary to ensure that, however rough and ready it may be, substantial justice is done: see

Godden v Alford

[1960] WAR 235 at 237. However, even in such cases it may be shown the successful party has in some relevant way misconducted himself or that the issues or causes of action on which the successful party has failed were unreasonably raised by that party. This would bring into operation different principles.

In my opinion, unless it can be said that the two causes of action on which the plaintiff failed had been 'unreasonably raised' this is not a case in which it would be fair to take the easy course by awarding costs to the plaintiff on the issue on which it was successful and costs to the second and fourth defendants on the other issues.

44 On the account of the issues in this case I have earlier set out it appears to me the plaintiff had complete success or, when the importance of the matters on which it succeeded is considered against the importance of the matters on which it did not, was largely successful as to all of them. The matter in which the plaintiff did not have complete success did not in my view contribute significantly to the length of the trial or otherwise represent matters of significance at least to the extent indicated by the defendants' minute.

45 I am of the view there were a number of 'causes of action', being principally different representations or forms of conduct, and the factual bases for deceit and aggravated damages or exemplary damages.

46 However, in my view, while there may or may not have been only 'one contest in substance' (on which see Permanent Building Society 575 and the approach his Honour took in that case), it would not in any event be appropriate to award costs to the defendants on the 'causes of action' on which the plaintiff failed where all of the causes of action pleaded arose out of one course of dealing and were reasonably raised.

47 Doing the best I can I would award costs to the plaintiff with a percentage reduction from those costs to reflect the areas and degrees of lack of complete success the plaintiff sustained: see on this approach Phillips Fox v Westgold Resources NL [2000] WASCA 85 [28]

(Page 11)

(Owen J); and

Mackenzie v Albany Finance Ltd

[2003] WASC 100 (S) [18] (McLure J). That reduction in my view should be 10%.

48 I turn now to the matter of costs of the transcript of the trial and other hearings.

Certificate for transcript of the trial and other hearings

49 The plaintiff's minute cl 3 reads as follows:

The Plaintiff's [sic] be awarded court fees for transcript of trial and other hearings in the Supreme Court in the sum of $ .

50 At the hearing counsel for the plaintiff confirmed the plaintiff did not ask the court to set a sum for this item. Rather the matter should be treated as a request for a certificate for the transcripts in question, with the amount for them to be left to the taxing officer.

51 The defendants' minute reads cl 3 as follows:

There be a certificate for one-half of the costs incurred by the Plaintiff in obtaining a transcript of the trial. The taxing officer is directed to make allowance for one-half of the costs of obtaining the transcripts of such interlocutory hearings as may be considered to be reasonable.

52 It may be seen there is no contest over a certificate for the costs of the transcript of the trial, except as to the proportion of the costs to be certified for; it may also be seen that there is a contest over the certificate for the costs of the transcript of other hearings.

53 As to the division of the costs of the transcript of the trial, for the defendants it was put that it was reasonable to expect a party to confer with the opposing party in relation to obtaining such a transcript. Had such conferral taken place, it was said, the parties would have agreed to share the cost of obtaining the transcript.

54 I agree that it is desirable parties confer with a view to sharing costs where such cost sharing is reasonably possible. I was told the parties in this case shared the costs of inspection of certain documents in the possession of a former solicitor for the plaintiffs, although it may be noted that I had called for joint inspection, and it was not explained to me how the costs had been shared.

55 However, it is clear to me that in many circumstances sharing of costs may not be reasonably possible, or may not be on an even sharing basis.

(Page 12)

56 In this case, as counsel for the plaintiff reminded me, I had asked for the parties in making their closing submissions at trial to make specific references to transcript page numbers. Even without such a request, I would expect parties in a trial as a matter of routine to have given serious consideration to securing the transcript on a running basis: see Kendall C and Curthoys J, Civil Procedure in Western Australia (at 6 January 2009) [34.5.8A]. Indeed, it appears that the plaintiff at least had proceeded in this case on the basis of securing the running transcript. Whether the ensuing use of the transcript by annotation or otherwise would preclude copying of it for the defendants was not clear to me. Of course if there were a practice of sharing the cost of transcript a party would, once the transcript was obtained and as a matter of course, make a copy of that transcript against the possibility of such sharing. However, I was not told of any such practice of sharing and I am not aware of one.

57 There may, however, be a particular difficulty with transcript, of the trial or of other hearings. It is that of copyright in the transcript, which counsel for the plaintiff referred to me. Whether or not Copyright Act 1968 (Cth) s 43 would authorise copying for another party of transcript obtained by a party was not made clear to me. However, the copyright warning carried on transcript that is made available to a party on payment of the relevant fee would in my view make it reasonable for a party not to consider sharing the transcript with the other party by copying it, at least in the absence of an approach by the other party. It was common ground there had been no such approach here.

58 In my view, on the foregoing, it is appropriate I give a certificate for the trial transcript in this case without reduction.

59 As to the costs for transcript of other hearings, the matter in my view resolves to whether or not those costs were necessarily or reasonably incurred: see Legal Practitioners (Supreme Court) (Contentious Business) Determination 2006 (2006 Determination) Table item 33. I consider that the certificate the defendants' minute provides for does not add anything to that provision, except as to the proportion of costs recoverable, which I would not consider it appropriate to specify for the reasons previously given. There is not, it seems to me, the same reasons as in the case of the trial to obtain the transcript of such hearings. On that basis, I do not consider a certificate for such costs is appropriate.

60 I turn now to the matters of certain costs reserved at the hearings to which the parties' competing minutes refer. At the end of my

(Page 13)

consideration of those matters, I address a further one, of a similar sort, not the subject of any reference in either of those minutes.

61 I turn then to the first matter of reserved costs.

Reserved costs: the defendants' application of 17 January 2006

62 This was an application to join a Mark Edward Penrose as a defendant in the proceedings. The application was discontinued by the defendants.

63 The plaintiff's minute cl 2(a) calls for the reserved costs of the application to be awarded to the plaintiff. The defendants in their written submissions indicated they did not object to the order sought by the plaintiff. There should thus be an order in the terms sought.

64 However, I have noted the defendants' minute cl 2a would make the costs payable by the defendants fall under the general order for costs of the action. Thus on that provision the reserved costs in question would be one for 90% of them, on the order for the costs of the action I would make. However, it is not clear to me why the reserved costs in question should be so reduced when the defendants discontinued the application. I would thus make the order in the terms first described.

Reserved costs: directions hearings on 3, 7 and 14 May 2007

65 The plaintiff's position was that these reserved costs should follow those of the action: plaintiff's minute cl 2(b) read with cl 1. The defendants' position was that the plaintiff should pay the defendants' costs of those hearings with a specific inclusion I will reach: defendants' minute cl 4.

66 The directions hearing on 3 May 2007 before me was held on the application of the plaintiff for leave to rely upon certain expert reports, for leave to rely upon certain witness statements of non-expert witnesses, being Mr and Mrs Frigger, and for a time for service of non-expert witness statements for the defendants.

67 There had been trial orders made by Le Miere J on 22 February 2007, providing for a trial listed to commence on 7 May 2007 for six days, and for trial documents and non-expert witness statements. The only orders for expert evidence had been made by the District Court in January 2006 and provided for service of or disclosure as to such evidence by a date long since passed. Expert reports for which leave had been sought included one, directed to the matter of investment opportunities in

(Page 14)

the Perth real estate market at certain times (and therefore relevant to the plaintiff's claim for loss of capital investment opportunity), which was of some complexity and technicality. That report had been provided to the defendants 11 working days before the day listed for the commencement of the trial, 7 May 2007.

68 Further, the orders of Le Miere J for non-expert witness statements for the plaintiff had called for these to be provided for service no later than 10 working days before the trial, where the witness statements of Mr and Mrs Frigger had been served with their annexures on 2 May 2007. Both witness statements were substantial. The orders of Le Miere J provided for witness statements for the defendants by five working days before the trial. No such witness statements had been provided by the hearing of 3 May 2007.

69 At the hearing of 3 May 2007, I determined it was appropriate orders be made for the trial of preliminary issues as to the conduct relied upon to justify relief sought and causation of the purchase of the Armadale property, to commence on Tuesday 8 May 2007, to allow for the return of subpoenas on Monday 7 May 2008. Thus, (if those orders were made) the matter of the assessment damages for loss, including the loss of investment opportunity, would be left for a separate hearing.

70 In the event, subpoenas were returned on Monday, 7 May 2007. However, following exchanges between the parties over the previous weekend with a view to producing a revised set of trial orders, including a list of preliminary issues for the trial, and following submissions from the parties, I vacated the trial date of 8 May 2007, and called on the parties to confer with a view to producing new trial orders.

71 The defendants' minute includes an order for any costs thrown away 'as a consequence of the vacation of trial dates on 7 May 2007'.

72 In the event a hearing was held on 14 May 2007 to consider competing sets of trial orders (both of which included orders as to expert evidence), to replace those of Le Miere J; to consider the defendants' application to have the action removed from the trial list; to consider an objection to produce certain documents made at the return of subpoenas on 7 May 2007; to consider an application for leave to the plaintiff to amend its re-amended statement of claim; and to deal with inspection of documents that were with a previous solicitor for the plaintiff. I made orders at the hearing in the first, fourth, and fifth respects, I dismissed the application in the second respect and I provided for further submissions in

(Page 15)

relation to the third respect. I made an order for costs thrown away in relation to the amendments to the pleadings for which I had given leave. On 15 October 2007 I ordered costs in relation to the third respect 'in the cause'.

73 Counsel for the plaintiff referred me to submissions made for the defendants at the hearing of 7 May 2007 in support of the removal of the action from the trial lists. Those submissions were that the defendants had been unable to inspect documents, the plaintiff's non-expert witness statements were late and some of its expert reports were also late. Counsel for the plaintiff put to me that none of those matters individually should be seen to displace what the parties appeared to accept was the usual approach to costs of hearings in the nature of directions ones, that of costs in the cause. In any event I consider that is the proper approach to the costs of that hearing, as it was predominantly, if not exclusively, a hearing to produce new trial directions.

74 As to the inability to inspect documents, counsel for the plaintiff drew to my attention prior opportunities to inspect of which the defendants had not availed themselves and the fact the documents were not available at the late stage requested was because they had been or were in the process of being incorporated into the trial bundle.

75 I note the confirmation of a number of these matters in the affidavit of Mrs Frigger sworn 12 October 2008 in support of the plaintiff's application for special costs orders and reserved costs (the affidavit of Mrs Frigger of 12 October 2008).

76 However, I have also noted what counsel for the defendants put to me, from the affidavit of David Vilensky, of the then solicitors for the plaintiff, sworn 2 May 2007 for the hearing of 3 May 2007 (the Vilensky affidavit of 2 May 2007). That affidavit indicated that at least some of the documents were unavailable because they were with the previous solicitors for the plaintiff. At the same time I note that the opportunity to inspect documents was being taken late in the proceedings, and previously the defendants had sought only copies of particular documents. It is true that subsequently to 14 May 2007 there was further discovery provided by the plaintiff, and amendments to the statement of claim were provided for, both at the hearing on 3 May 2007 and subsequently. However, in my view the discovery and the amendments were at least in significant part in response to the case for the defendants as it became clearer over this period. That case was in substantial part that of the capacity in which the plaintiff was acting at all material times.

(Page 16)

77 As to the late non-expert witness statements, counsel for the plaintiff put to me that that lateness was due to the diversion of the plaintiff's resources into preparation for the defendants' application for security for costs to which I return below. Further, the defendants had filed the witness statements of their non-expert witnesses after the due dates for them provided for in the trial orders of 14 May 2007.

78 In respect of the last matter, in my view it has some but limited bearing on my assessment of the plaintiff's submissions. That history of late filing does not seem to me to have a bearing on the diligence with which the plaintiff would have seen to compliance with the trial orders of Le Miere J. At most that history goes to show that, even if there had been compliance with the trial orders of Le Miere J, the defendants at all material times might not have been in a position to proceed to trial on the due date. However, the defendants were in a position to proceed to trial on 2 November 2007 notwithstanding their lateness in relation to their non-expert witness statements. They did seek to have that date adjourned or vacated as I have indicated, but on another basis which I will consider below.

79 Counsel for the defendants pointed out that in the Vilensky affidavit of 2 May 2007 no mention is made of lateness of the non-expert witness statements for the plaintiff as being due to the security for costs application. However, I accept that it is likely, in view of what appears to be considerable work by Mr and Mrs Frigger that went in to that hearing, that that work significantly affected their ability to prepare the witness statements for trial. Later in these reasons I address that work and why that work was done. Further, I am not convinced the security for costs application, coming when it did, was one the possibility of which the plaintiff might reasonably have been expected to plan for.

80 As to the expert reports for the plaintiff that were late, counsel for the plaintiff relied on the fact the principal such report, relating to the claim for loss of capital investment opportunity, simply confirmed the increase in real estate values using several indices, and the defendants indeed never filed any expert reports of their own. However, I note that considerable trial time was devoted to the subject matter of that report, and supplemental ones updating it, and the order for trial of other matters as preliminary issues I had indicated should be made was the result of my view of the complexity and technicality of the report.

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81 In the event, I have determined that the appropriate costs order as to the costs reserved from the hearings of 3 May 2007 and 14 May 2007 is that there be no order as to those costs.

82 I consider the contribution of the plaintiff to the necessity to arrive at new trial orders makes it appropriate not to award costs in the cause.

83 At the same time, I am convinced that that necessity was also substantially contributed to by the conduct of the defendants. This conclusion makes it appropriate not to order costs for the defendants.

84 I have also concluded that the appropriate order for the reserved costs of the hearing of 7 May 2007 is the same, with a saving.

85 I accept that the hearing was in significant part given over to the return of subpoenas, and I would make a saving for the costs of that.

86 However, the hearing of 7 May 2007 was the result of the orders for the trial made on 3 May 2007, and led directly to the hearing on 14 May 2007. The reason the matter did not proceed to trial on preliminary issues was the inability of the parties to find a definition of such issues. The necessity to arrive at such a definition arose from the circumstances both parties contributed to as I have indicated that had produced the orders made on 3 May 2007 and led to the orders made on 14 May 2007.

87 I consider a saving should be made for the costs in relation to the return of the subpoenas on 7 May 2007, as costs in the cause. As I have indicated, I made an order for costs in the cause with respect to submissions arising out of the return of one of them. In my view it would not be appropriate to deal otherwise with the costs of that subpoena at the hearing on 7 May 2007, or the costs of the other subpoenas on that day.

88 I turn now to the next matter of reserved costs.

Reserved costs: the defendants' application to amend the defence on 15 October 2007; the plaintiff's application for freezing orders on 8 and 11 January 2008

89 The defendants' application was discontinued by the defendants.

90 On 8 January 2008 at an ex partehearing I granted the plaintiff's application for freezing orders and adjourned the matter to a further hearing to be relisted on the defendant's application; while on 11 January 2008 on the defendants' application Hasluck J varied the freezing orders.

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91 The plaintiff's minute [2(d)] and [2(e)] call for the costs reserved in each case to be awarded to it, and the defendants in their written submissions indicated they did not object to the orders sought by the plaintiff. There should in my view be an order in the terms sought by the plaintiff.

92 I have noted the defendants' minute cl 2b and cl 2c includes the costs payable by the defendants under the general order for costs of the action. This would make the order one for 90% of the reserved costs in question. However, as with the first matter of reserved costs considered above, it is not clear to me why the present reserved costs, one for an application discontinued by the defendants, and one by the plaintiff that was successful to protect a future judgment under which the plaintiff was substantially successful should be so reduced. I would make the order in the terms first described.

93 I turn now to the remaining matter of reserved costs from the plaintiff's minute.

Reserved costs: the plaintiff's request for appointment of a receiver heard on 9 July 2007

94 By letter dated 5 June 2008 and minute of receiver order filed 5 June 2008 the plaintiff applied for the appointment of a receiver by reason of alleged breaches of the freezing orders, as deposed to by Mrs Frigger in her affidavits sworn 30 January 2008 and 5 June 2008. An affidavit in opposition to the application, of Mr Banning sworn 8 July 2008, was handed up in court at that hearing but not formally filed. On 9 July 2008, before there had been a hearing of the merits of the plaintiff's application, judgment was delivered. However, at the hearing that day I directed the parties to confer about the continued need for the application.

95 I should also note that, on 21 November 2008, on a separate application by chamber summons of the plaintiff dated 8 August 2008 I made an order for the appointment of a receiver in respect of some but not all of the assets for which application was made, and ordered that costs of that application be reserved.

96 The plaintiff's position was that it should be awarded the reserved costs of the earlier request: see plaintiff's minute cl 2(f). The defendants' position was no provision for costs should be made, at least until the request was heard and determined, or formally discontinued.

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97 In my view, I am not in a position, where the request was not pressed, and a separate application of a similar kind was brought subsequently, to determine liability as to costs. In my view, the position put to me by the defendants is to be preferred, even although it may be likely to mean in effect (if not in form) no order as to costs, as it seems to me unlikely the plaintiff will bring the earlier request forward for determination or discontinue it, unless the defendant seeks its costs.

98 I turn now to a further matter of reserved costs not dealt with in the plaintiff's minute.

Reserved costs: Magistrates Court costs

99 Prior to the hearing on 17 December 2008 counsel for the plaintiff by letter to the court dated 16 December 2008 indicated an order would also be sought for the costs incurred in the Magistrates Court (by which I assumed was also meant the Local Court) proceedings in this matter. Those costs, the letter indicated, had been awarded to the plaintiff there, and comprised filing and service fees for the originating summons of 17 September 2003, a chamber summons for an order the defendants file a defence, which order was made by Magistrate Whiteley on 9 July 2004, and an expert fee for a licensed valuer for a report obtained for the assessment included in the sum awarded in the summary judgment for the plaintiff in August 2004. However, on 8 February 2005, it was said, the District Court had ordered those costs be reserved to the trial judge.

100 At the hearing before me, counsel for the plaintiff indicated he would not press for an order in the same terms as in the Magistrates Court, on the basis the amounts concerned would be included in any order that the costs of the action follow the event. As I have indicated earlier, that is the substance if not the form of the order I have indicated I would make.

101 However, it is not clear to me that, if the District Court order remains as it is, that that would be the result: see District Court Act of Western Australia Act 1969 (WA) s 78(a).

102 In my view, the matter of the costs in the Magistrates Court referred to requires greater development than it received at the hearing before me on 17 December 2008. As put by the defendants' counsel, the date of receipt of the plaintiff's letter made submissions by the defendants in relation to the matter particularly difficult; indeed my programming orders for the hearing of 17 December 2008 had called for submissions including any further submissions by the parties to be filed and served by 11 December 2008.

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103 At the same time, I cannot dismiss the plaintiff's application as to the costs in the Magistrates Court the subject of the District Court order as simply made too late. This is given the reservation of the costs to me, and the undoubted difficulty in discovery of that order in proceedings as complicated procedurally as these have been.

104 Accordingly, I will hear further from the parties as to the order to be made in respect of the costs in the Magistrates Court the subject of the District Court order.

105 I turn now to the special costs orders sought by the plaintiff, beginning with a review of the general principles that appear to me to guide the exercise of jurisdiction to make such orders.

Special costs orders: general principles

106 My jurisdiction to make special costs orders in this case lies in Legal Practice Act 2003 (WA) (2003 LP Act) s 215, which reads as follows:

215. Effect of determination

(1) Subject to sections 221 and 241 of this Act and section 14 of the Legal Aid Commission Act 1976 -

(a) the taxation of bills of costs of legal practitioners, as between legal practitioner and client or party and party; and

(b) any other aspect of the remuneration of legal practitioners the subject of a determination,

is regulated by a legal costs determination in force under section 210.

(2) Despite subsection (1), if a court or judicial officer is of the opinion that the amount of costs allowable in respect of a matter under a legal costs determination is inadequate because of the unusual difficulty, complexity or importance of the matter, the court or officer may do all or any of the following -

(a) order the payment of costs above those fixed by the determination;

(b) fix higher limits of costs than those fixed in the determination;

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(d) make any order or give any direction for the purposes of enabling costs above those in the determination to be ordered or taxed.

(3) Nothing in subsection (1) is to be construed as limiting the power of a court, a judicial officer or a taxing officer of a court to determine in any particular case before that court or judicial officer the amount of costs allowed.

(4) If a legal costs determination is in force under section 210 in respect of any business referred to in section 210(2), any other subsidiary legislation fixing or purporting to regulate the remuneration of legal practitioners in respect of that kind of business is of no force or effect.

107 The 2003 LP Act when it came into force on 1 January 2004 displaced the former source of the court's jurisdiction, SC Rules O 66 r 12(1), which was a wider provision, and was repealed effective 1 March 2007. See on that displacement SDS Corporation Ltd v Pasdonnay Pty Ltd [2004] WASC 26 (S2) [97], [98] (Roberts-Smith J), followed in most other authorities in the court, on which see Hodgkinson v Doepel & Associates Architects Pty Ltd [2006] WASC 237 (S) [29] (Simmonds J). However, as I will indicate, I consider, as I did in Hodgkinson, that at least some of the principles developed in relation to former O 66 r 12(1) may be applied to 2003 LP Act s 215(2) also.

108 At this point I should note that it may readily be suggested that once the court has formed the opinion with its components referred to in Heartlink v Jones as Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254 (S) [11] (Martin CJ) the court has a discretion. It may further be suggested that that discretion is not only as to the form of the orders it may make as described by LP Act s 215(2)(a) - (d). That discretion includes whether or not to make any order. The present section of these reasons is concerned with the principles that the authorities indicate should guide the court in determining whether or not it should form the opinion with the two components described. The next section of these reasons addresses the matter of the discretion and its exercise.

109 Special costs orders may be made under 2003 LP Act s 215(2)(b) or (c) to lift the hourly rate allowed for in a particular item in the relevant costs determination in force, or to lift the time allowed for in the particular item in that determination (see the orders I made in Hodgkinson(S)), or for both (see Cazaly Iron Pty Ltd v Minister for Resources [No 5] [2008] WASCA 181).

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110 For my purposes a convenient summary of the principles to be applied to the making of orders under 2003 LP Act s 215(2) is to be found in Heartlink [11] - [23], [25], [26] (Martin CJ), as follows:

In that factual context, I return to s 215(2) of the Legal Practice Act. The first question that arises for my consideration is the nature of the task performed by the court under that section, and, in particular, the question which the court is required to address. Before the court can make an order under the subsection, the court must form an opinion which has two components. The first is that 'the amount of costs allowable in respect of a matter under a legal costs determination is inadequate', and the second is that the inadequacy arises because of the 'unusual difficulty, complexity or importance of the matter'.

The question posed to the court under s 215(2) will almost always arise before taxation has occurred. It is of course the responsibility of the taxing officer to tax the bill and identify with precision the amount that should be allowed in respect of the particular claim for costs. Section 215(2) also falls to be construed in the context of the well-known principle that at least in respect of costs as between party and party, the principle is that the successful party should be compensated by the unsuccessful party for their costs (see O 66 r 1, Rules of the Supreme Court 1971 (WA)).

Those two considerations provide a guide to the proper approach to be taken to the question posed to a court when an application is made under s 215(2). The policy considerations that should guide a court when addressing an issue under s 215(2) are, firstly, that the court should not usurp the role of the taxing officer and, secondly, that at least where party and party costs are concerned, the court should make an order that would give effect to the general principle of allowing the successful party to be compensated for their costs by the unsuccessful party, where appropriate.

There are two alternative ways in which one might approach the question of inadequacy posed by s 215(2). The first would be to require an applicant for an order under that subsection to satisfy the court that the bill to be taxed will, on the balance of probabilities, tax at an amount that is greater than the limit that would be imposed by the item in the relevant costs determination, which is therefore inadequate. The alternative approach would simply be to require an applicant for an order under the section to satisfy the court that there is a fairly arguable case to be put before a taxing officer to the effect that the bill to be taxed should tax out at more than the limit that would be imposed by the costs determination.

On this alternative view of the section, the court could arrive at the conclusion that the limit was inadequate because the maintenance of the limit would preclude the applicant from presenting a fairly arguable case to the taxing officer. The considerations to which I have referred, and in particular the view that the court should not, under this section, usurp or anticipate the role of the taxing officer, lead me to conclude that the latter

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of those two alternatives is the preferred approach to an application under s 215(2).

It therefore seems to me that the requirement of inadequacy will be demonstrated if the applicant shows that there is a fairly arguable case that the bill to be presented to the taxing officer may tax at an amount which is greater than the limit that would be imposed by the relevant costs determination. Of course, as I have pointed out, that is only the first question which the court must address. The second question is whether that inadequacy arises because of the unusual difficulty, complexity or importance of the matter.

It is common ground between the parties that the word 'unusual' qualifies only the expression 'difficulty' and does not qualify the words 'complexity' or 'importance'. Another issue was, however, raised in argument in relation to those words, and that concerns the meaning to be given to the word 'importance'. Heartlink submits that the criterion of importance cannot be met having regard to the interests of the parties only, but must, in order to be satisfied, import an element of importance to the community.

I cannot see any reason in policy or principle why the word 'importance' should be construed in this way. If it had been the intention of the legislature to require the court to give consideration to an issue of community or public importance, then I think it would have been reasonable to expect the legislature to use words that would connote that meaning, such as the well-known phrase 'public importance' which is found in a number of other legislative provisions.

It seems to me that by reference to 'importance' in this context, the legislature is allowing the court to have regard to the question of whether the work done was appropriate to the significance of the issues that arose in the litigation. Significance can arise either because of the significance of the issues to the parties or because of the significance of the issues to other prospective parties or to the public or to the community generally. In this case, the issues raised were of considerable significance to the liquidators in the practice of their profession, and in respect of whom serious allegations were made.

Another consideration that appears to me to be significant to the construction and application of s 215(2) also arises from the time at which that determination is to be made. Because it is a determination which will ordinarily be made in advance of taxation, it should be made as a matter of impression rather than as a matter of detailed evaluation. An approach which would require an applicant to demonstrate that a limit is inadequate by reference to a detailed evaluation of a draft bill for taxation would carry the risk that what has elsewhere been described as 'satellite litigation' (and which I would describe as parasitic litigation), might assume a life and dimension of its own, disproportionate to its significance.

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Such an approach should be discouraged, because it is in the interests of the parties and of the public for disputes with respect to costs to be resolved as quickly and as efficiently and as inexpensively as possible.

Accordingly, approaching the matter as one of impression, the question which I pose to myself is whether the limit of $27,456, which would be imposed if I do not grant the application sought, would be inadequate because it would preclude the liquidators from advancing to the taxing officer a fairly arguable case that their bill should tax at an amount greater than that. Approaching that question as a matter of impression, having regard to the affidavits which have been filed and which I have read, and having regard to the affidavit evidence of Mr McLeod to which I have referred, I am satisfied that the amount to which the liquidators would be limited under item 11 is inadequate in the sense that I have described.

I turn then to the second question for my determination under s 215(2), which is the question of whether that inadequacy arises because of the 'unusual difficulty, complexity or importance of the matter'. …

…

Of course, nothing that a court does in determining an application under s 215(2), can in any way bind or impinge upon the decisions to be made by the taxing officer as to whether or not work was appropriately and reasonably done, or as to the proper amount to be allowed in respect of that work. In my view, the question for determination at this point of the proceedings is not whether the bill will, in fact, tax out at more than the limit, but rather whether there is a fairly arguable case that it may tax out at an amount above the limit.

It would be quite consistent with that approach for a taxing officer to conclude, after considering the bill in detail, that in fact the amount to be allowed on taxation is less than the limit. So it will be entirely for the taxing officer to determine whether or not the work was properly and appropriately done and, if so, the amount properly allowed. …

111 In respect of the component as to inadequacy of the opinion the court must form before it can make an order under LP Act s 215(2), I note the following from Green v Wilden Pty Ltd [2005] WASC 83 (S) [182] (Hasluck J) where his Honour was drawing on the lessons of the authorities on O 66 r 12(1):

There is no reason why the amount of work involved in the preparation of a case cannot of itself show that the costs allowable by a legal costs determination are inadequate: see

Schmidt v Gilmour

[1988] WAR 219. In complex litigation it may be necessary to supply detailed affidavit evidence to support an application for an order increasing the scale allowance:

Geraldton Building Co Pty Ltd v Christmas Island Resort Pty Ltd

(1994) 13 WAR 242 at 248.

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112 The plaintiff appears to rely heavily on this passage from Green, in drawing on the affidavit of Mrs Frigger of 12 October 2008. There Mrs Frigger sets out (in annexure 'ACTF 1') amounts apparently charged alongside some (limited) descriptions, or amounts paid (to nominated persons), or both, under headings which appear to be intended to relate to items from the 2006 Determination. The amounts shown significantly, either individually or in total or both, exceed the amounts shown for or calculable from the item in question in the 2006 Determination.

113 However, as the defendants point out, the affidavit does not contain any further description of the work done, nor does it provide any indication of the time occupied by the work or the hourly rate used. Indeed, as the defendants also point out, there is as an annexure to the affidavit of a solicitor in a firm of solicitors which had previously acted for the plaintiff in the present action a letter from the plaintiff to that firm in which there is a complaint that the firm had 'grossly overcharged' the plaintiff: see the affidavit of David Vilensky sworn 14 April 2008 annexure DV5. There is no indication there had been any reduction on that account in the affidavit of Mrs Frigger of 12 October 2008.

114 In my view the most that can be extracted for my purposes from the affidavit of Mrs Frigger of 12 October 2008 is that the charged or paid amounts exceed the relevant maximum allowed amounts (or allowances) from the 2006 Determination. It is not apparent to me, however, whether that was the result of the hours worked or the hourly rate or some combination of the two. In those respects the evidence provided in support here is like that in EDWF Holdings 1 Pty Ltd v EDWF Holdings 2 Pty Ltd [2008] WASC 275 (S), [6], [7] (Martin CJ), where the Chief Justice said this:

The first defendant relies upon an affidavit of its solicitor. He deposes to his estimate of the costs which were billed to the first defendant in relation to the particular items the subject of the application. However, the affidavit provides no details or particulars whatever to support the estimates which he has made. The affidavit does not depose to the professional time spent in relation to each item, or as to the practitioners involved, or as to the rates used when calculating the fees charged to the first defendant. It follows that the evidence is of little or no value, because it does not enable any meaningful comparison to be undertaken of the work allowed in the relevant item of the relevant costs determination, and the work actually performed. The affidavit also annexes invoices rendered by junior counsel. However, those invoices are equally unhelpful, as they do not identify the professional time spent on any particular aspect of the case, or the rate at which fees have been rendered.

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Despite the porosity and inadequacy of the evidence proffered in support of the first defendant's application, as the questions to be addressed under s 215 of the Act are to be addressed as matters of impression rather than detailed evaluation (

Heartlink

… [20] and

Leighton Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union

[No 4] [2006] WASC 317 (S) [13]), I will do the best I can on the materials available.

115 Assisted by these remarks from EDWF Holdings 1, I conclude that the affidavit of Mrs Frigger of 12 October 2008 offers no support for any conclusion, in the terms of Heartlink [14], that 'there is a fairly arguable case to be put before the taxing officer to the effect that the bill to be taxed should tax out at more than the limit that would be imposed' by the 2006 Determination. However, I may still arrive at such a conclusion, as a matter of impression rather than detailed evaluation, on all of the materials before me. Those materials, as I will explain, include what I know of the action in the relevant respect from my position as the presiding judicial officer or from the file materials or from both: see EDWF Holdings 1 [8], [9].

116 I should note that I have arrived at this conclusion as to the affidavit of Mrs Frigger of 12 October 2008 without taking account of the fresh evidence. At the hearing of 6 April 2009 to consider the fresh evidence counsel for the defendants, as I understood him, submitted that that evidence went to show that certain information in the affidavit was incorrect, called into question the accuracy of the 'analysis' in the affidavit (see EDWF Holdings 1 [6] quoted above) and in any event made the information in the affidavit misleading. As I consider that that affidavit offers no support for the making of any special costs orders under LP Act s 215 I need not consider the position in that regard if I agreed with counsel's submission that the affidavit contains incorrect, inaccurate or misleading information.

117 However, counsel for the defendants made a further submission, resting on the submissions just referred to, that the conduct of the plaintiff in relation to the affidavit of Mrs Frigger of 12 October 2008 and in relation to the fresh evidence was misconduct that had the potential to mislead the court. Such misconduct, counsel for the defendants said, was thus relevant to the exercise of the court's discretion under LP Act s 215 whether or not to make any special costs orders it might otherwise make. Indeed, counsel for the defendants submitted, that misconduct should result in the denial of such orders. I return to those further submissions below, where I consider the discretion those submissions invoke.

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118 I further note from Verdell Pty Ltd v F & G Nominees Pty Ltd [2002] WASC 58 (S2) [14] - [15] (Wheeler J), setting out as emerging from the authorities certain 'general propositions … in relation to the task of the judge who determines whether or not a special costs orders should be made', the following:

If the Judge has been the trial Judge, he or she will be able to draw on experience of the trial, which will be of great assistance in understanding the issues involved, and in appreciating the extent to which, for example, detailed preparation for cross-examination appears to have been necessary, or work appears to have been necessary beyond normal court sitting times to respond to matters arising suddenly during the course of the trial. Whether or not the Judge has been the trial Judge, a perusal of the pleadings, the transcript, and the submissions, together with the materials which may relate to interlocutory applications, will be of great assistance in understanding whether it was necessary for additional work to be done.

Whether or not the Judge has been the trial Judge, there may be work done of which the Judge is not aware. For example, there may have been unusually voluminous discovery, which is not reflected in the actual number of documents tendered at trial, or there may have been consultation with potential expert witnesses or research of issues of law which were not in the end reflected in the trial. Such work may not have been unnecessary in the light of what was known at the time, but may have resulted in agreement between the parties or a decision by one or another party to abandon an issue which at first appeared to arise. In those cases, it will be necessary for affidavit material to be placed before the Judge explaining in general terms what work was done and why it was done, and giving some indication of the time occupied by such work. It will, of course, be necessary to establish that, prima facie, costs appear to have been incurred which exceed those allowable under the scale. Whether this material is produced in the form of a computer printout, or a draft bill, or a summary prepared by the practitioner having carriage of the file, does not appear to me to matter. If the step is taken of producing a detailed schedule or a computer printout or the like, the Judge will not examine the material line by line, looking for possible duplication or overlap, or enquiring about the way in which every 10 minutes was spent.

119 True it is her Honour was referring to the jurisdiction under former O 66 r 12(1), which at the time of her Honour's judgment read as follows:

Where the Court is of opinion that a special order as to costs should be made by reason of the unusual complexity or importance of the case or for any other good or sufficient reason the Court may order that any particular allowances in any relevant scale be raised or a limit removed and in giving any such direction the Court may fix a limit within which the Taxing Officer may allow such costs.

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120 However, I do not consider that the differences between O 66 r 12(1) and the 2003 LP Act s 215(2) make her Honour's general propositions inapplicable to the latter. In particular, I consider on the basis of those general propositions that the judge may (as where the matter related to the trial or another hearing, and she or he was the presiding judge) be able to form the opinion as to inadequacy based on her or his understanding of the proceedings without affidavit support: see also EDWF Holdings 1 [8], [9]. However, it might be otherwise where the judge from whom the order is sought lacked such an ability (as where she or he was not the presiding judge, and the information about the matter is insufficient for the purpose): see Verdell [15] above.

121 Counsel for the defendants put to me, however, that the court must have material before it indicating whether or not an uplift is sought in respect of time spent, or hourly rate, or both (depending on the item in the relevant determination in respect of which the uplift is sought). The supporting material in this case in the form of the affidavit of Mrs Frigger of 12 October 2008 does not condescend to that level of detail.

122 I do not agree with this submission. I do not consider that such a limitation is to be extracted from Verdell in her Honour's application of the general proposition she set out there: see [24], [25] and [26]. Further, it seems to me such a limitation is also difficult to square with the general principles in Heartlink [20].

123 It is true that the limitation referred to derives support from Flotilla Nominees Pty Ltd v Western Australian Land Authority [2003] WASC 122 (S) [22], [23] (Pullin J), which I quoted and applied in Hodgkinson (S) (see especially [39]). However, in my view of the authorities it is possible to ask for the relevant costs to be taxed without regard to the limit or limits applicable under the relevant item, and if the materials before the judge, including her or his own awareness of the matters in the proceedings, are sufficient for the purpose, conclude there is a fairly arguable case to be put before the taxing officer that the costs should be allowed at the times and hourly rates or one or the other relied upon, regardless of the limit or limits in question: see Cazaly [9], [10] (Buss JA); and EDWF Holdings 1 [9] and [10]. Here, I understood the plaintiff to be seeking an uplift of both types of limit under the relevant scale item.

124 However, before an uplift of either kind is possible, there must be sufficient basis in the materials before the court for an order providing for such an uplift to be made.

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125 In respect of the other component of the opinion the court must form before it can make an order under LP Act s 215(2), as to whether or not any inadequacy arises because of the unusual difficulty, complexity or importance of the matter, I note in respect of the matter of which term or terms in 2003 LP Act s 215(2) 'unusual' qualifies there is strong support for the 'common ground' in Heartlink [17] to be found in SDS Corporation (S) [102] - [106] (Roberts-Smith J); see also Green (S) [182] (Hasluck J).

126 Below I will consider the aspects of the proceedings in this action relied upon by the plaintiff to show that 'unusual difficulty, complexity or importance'.

127 There are at least two further points. One concerns what relevance if any to the making of a special costs order there is in the defendants' conduct in the litigation to which attention was directed before me by both sides. The other concerns the relevance of GST.

128 As to the relevance if any of the conduct in the litigation of the party against whom a special costs order is sought, it seems to me such conduct might go to show the unusual difficulty, the complexity or the importance to which 2003 LP Act s 215(2) refers.

129 In this case, some of the forms of conduct relied on by the plaintiff do go to show one or more of those matters, and are referred to in that connection below. Those references are in the discussion of special costs orders in relation to the timing of the defendants' security for costs application heard in April 2007; and the impact, on the pleading out of the statement claim, on the directions hearing of 29 October 2007 and on the trial, of the way in which the defendants raised the issue of the capacity in which the plaintiff claimed. There is also in the discussion of the special costs orders sought in relation to the trial the further matter of late witness statements from the defendants.

130 However, it was not made evident to me how the remaining forms of conduct relied on by the plaintiff (see its written submissions for the hearing on 17 December 2008, [42], [44] - [46] and [48] - [52]) went to show the unusual difficulty, the complexity or the importance referred to in s 215(2).

131 At the same time, it may be that the conduct of the party against whom a special costs order is sought may be relevant to the exercise of the discretion whether or not to make any order. I reach that discretion in

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the next section of these reasons. I consider there the possible relevance of the conduct relied upon by the plaintiff.

132 As to the matter of GST, I note the submissions of counsel for the defendants that, as I understood them, because the plaintiff was a GST registered entity amounts for payments to legal representatives should be reduced to allow for GST recoverable by the plaintiff: in this connection I was referred to Keen v Telstra Corp Ltd [2006] FCA 834; GST Ruling GSTR 2001/4; and JH Lever & Co Pty Ltd v Maniotis [2006] FCA 1668 [13]. Those authorities appear to concern what amounts may be recovered from the other side on a party and party taxation, not how I should approach the question of the adequacy of a scale item in a costs determination like the 2006 Determination. However, assuming I must for that purpose reduce each item by 1/11 the effect as I apprehend it is not to reduce the amount concerned in any way material to my deliberations, as will become apparent.

133 Finally, I note that the relevant costs determination for my purposes is put by the plaintiff as the 2006 Determination. Although the contrary was put to me by the defendants, it seems to me that is the only relevant costs determination for my purposes.

134 Thus, I note that all of the uplifts sought in the plaintiff's minute are prefaced as follows:

The Taxing Master, in taxing the bill of costs of the Plaintiff, do make reasonable allowance for the following items having regard to the work done but without regard to the limits imposed by the Supreme Court Scale of Costs applicable from 1 July 2006 for the following scale items:

135 1 July 2006 is, as those words indicate, the date from which the 2006 Determination applies: see cl 3(3) which reads:

This determination does not apply to the remuneration of practitioners based on costs incurred before 1 July 2006.

136 Before proceeding further, I must address the matter of the fresh evidence considered at the hearing of 6 April 2009 in relation to the matter of the discretion whether or not to make special costs orders once the court is of the opinion with the two components described. I must do so because, if the defendants' submissions in that regard are upheld, there would be no question of my making any of the special costs orders the plaintiff seeks.

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The discretion and the fresh evidence

137 There is clearly a discretion which is enlivened when the court has formed the opinion with the two components referred to in Heartlink [11].

138 However, in my view that discretion is not confined to making all or any among the orders referred to in 2003 LP Act s 215(2)(a) - (d). Such discretion includes whether or not to make an order of any of those kinds.

139 On this view the word 'may' in s 215(2) is not one which simply confers a power which must be exercised by making all or any among the orders in s 215(2)(a) - (d). Compare Moody v French [2008] WASCA 67 [47] (Steytler P, Wheeler, McLure and Buss JJA) on 'may' in Sentencing Act 1995 (WA) s 89(1).

140 I consider there is support for the view I hold from Flotilla [37] (Pullin J), on the former SC Rules O 66 r 12(1) which 2003 LP Act s 215 displaced. I do not consider that displacement affects that support from Flotilla. There is also support for the view I hold to be derived from another authority on O 66 r 12(1), Esther Investments Pty Ltd v Markalinga Pty Ltd (1992) 8 WAR 400, 406 - 409 (Malcolm CJ) (on delay in making an application for a special costs order under that sub-rule).

141 In this case I do not need to consider how if at all the exercise of the general discretion as to costs in O 66 r 1(1) might affect a special costs order. However, it seems to me authorities on the exercise of that general discretion are of assistance to me in determining how the discretion under LP Act s 215 should be exercised. In particular it seems to me that misconduct in relation to seeking a special costs order under s 215 might result in the court exercising its discretion under that provision to refuse an order it might otherwise have made. See the discussion of authorities on the denial under O 66 r 1(1) of costs to a successful party in Civil Procedure in Western Australia (at 11 April 2009) [66.1.4A].

142 As I indicated earlier, the defendants said that the fresh evidence shows the matter in the affidavit of Mrs Frigger of 12 October 2008 was inaccurate or incorrect. The defendants said that the inaccuracy or incorrectness was such as to call into question the accuracy of the 'analysis' described in the affidavit ([6], below) and in any event made information in it misleading. They further submitted that those features of the affidavit were such that the conduct of the plaintiff in certain respects

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was misconduct which had the potential to mislead the court. Those respects were putting the affidavit forward; relying upon it at the hearing of 17 December 2008, particularly when its accuracy in the respect said to be contradicted by the fresh evidence was challenged; refusing to consent to the court being informed of the fresh evidence when invited to do so by waiving the obligation of non-disclosure in respect of that evidence; and continuing to insist on the accuracy of the affidavit. The defendants said that such misconduct was relevant to the exercise of the court's discretion under LP Act s 215(2) whether or not to make any special costs order it might otherwise make. Indeed, the defendants said, such misconduct should result in the refusal to make any such special costs order. I take the submissions as including that the misconduct was deliberate, at least once the fresh evidence was drawn to the attention of the plaintiff’s legal representatives.

143 For the purpose of assessing whether or not in the light of the fresh evidence the affidavit of Mrs Frigger of 12 October 2008 was incorrect or inaccurate as alleged, the defendants drew my attention to the following portions of the affidavit.

144 The defendants drew my attention to affidavit [6], which reads as follows:

I analysed the itemized bills of costs by allocating a scale item number from the Supreme Court Scale of Costs Table applicable from 1/7/06 to each line item on the invoices, based on the proceeding or legal service for which the line item was charged. This is a common analysis that accountants perform in their professional work. I then input the amount of each line item into a MYOB accounting program according to that analysis. I compared the total amount charged for each hearing or service against the applicable scale item allowed on the table, which is shown in the submission as paragraphs 7.4 - 7.12. Annexed hereto and marked 'ACTF 1' is a report produced from MYOB program showing the results of the analysis.

145 The object of the reference to 'paragraphs 7.4 - 7.12' is unclear, as counsel for the defendants pointed out to me. It is possible it is to what became paragraphs 31 - 40 in the plaintiff's written submissions for the hearing of 17 December 2008. In any event it is not clear to me what that lack of clarity added to the defendants' submissions.

146 The defendants also drew my attention to the numbered item 'Paid to counsel' under each of the headings 'Trial 2/11/07', 'Trial 5/11/07', 'Trial 7/11/07', 'Trial 8/11/07' and 'Trial 9/11/07' in the annexure 'ACTF 1' to the affidavit of Mrs Frigger of 12 October 2008. Those headings were for the

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first to the sixth days of the trial. Each numbered item 'Paid to counsel' showed an amount of '$7 700.00'. The defendants had in written submissions filed and served before and oral submissions at the hearing of 17 December 2008 particularly called attention to the size of the amounts for counsel's fees for the second and subsequent days of the trial relative to the allowance in item 19(c) in the 2006 Determination 'Counsel fee for the second and each successive day of hearing', of $3,102. That amount equates to the maximum daily rate for counsel inclusive of GST.

147 The fresh evidence is in the form of the document 'Memo of Counsel Fees' of the then counsel for the plaintiff, dated 16 November 2007 and directed to the then solicitors for the plaintiff. A copy of the memo is annexure 'ACTF 2' to the affidavit of Mrs Frigger of 4 March 2009 in CIV 1216 of 2009 in opposition to the originating summons in that proceeding. The memo sets out 34 numbered items, only one of which (item 34) includes a dollar amount. Item 34 is 'attending' at the court on 29 October 2007 and other dates which are those of the first six days of the trial. Item 34 ends with '(7 days @ $3 500.00 per day)'. That daily rate, as will shortly become clear, did not include GST.

148 Following that listing there are two unnumbered entries with a dollar total for each. One is for 'full day attendances' at the court, for seven days in all, being the seven days in item 34, showing for '7 days @ $3 500.00 per day' a total of $24,500. The other is for 'attendance exclusive of full day attendances at court on dates referred to above'. The two totals are then reduced, by slightly more than 10%, and GST is added, to produce a final total payable. After allowing for the reduction, counsel's daily rate, inclusive of GST, on the defendants' calculations with which no issue was taken by the plaintiff, was $3,402.74. That daily rate is 9.7% higher than the maximum daily rate for counsel in the 2006 Determination.

Special costs orders: the defendants' security for costs application heard April 2007

179 The plaintiff's minute refers in cl 4(c) to 'Defendants' security of [sic] costs application Scale Item 10(a)'.

180 It was common ground this related to an application by the defendants dated 12 March 2007 which was heard by Le Miere J on 20 and 26 April 2007 and dismissed by him on the latter date, with costs to the plaintiff in the cause. Consent orders had previously been made on 19 March 2007, but without a hearing.

181 The amount provided for in the 2006 Determination item 10(a) 'Proceeding in Chambers [other than originating summons, originating motion or originating application]' is $9,306, which is for two days preparation and one days hearing, by counsel, and which equates to three days at the maximum daily rate for counsel.

182 The plaintiff's submissions were as I understood them that there was unusual difficulty, or complexity, or importance, which could be seen in the number of affidavits filed for the proceedings (nine) and their total size (260 pages), the total duration of the hearings (six hours is referred to, although the record of the hearing on the court's database for 20 and 26 April 2007 shows a total of just under 4 1/2 hours), and the timing of the application, coming as late as it did after having been foreshadowed in 2003 and made in the period shortly before the listed first day of the trial when the plaintiff was preparing for the trial.

183 I put aside the plaintiff's reference to its view the application was a tactic to delay the trial. I am unable to see what that adds to the other factors listed. Nor on the length of the hearings or on my inspection of

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the transcript of them, and subject to what I say below, do I see any clear indication any such tactic was pursued into those hearings.

184 This last point illustrates a difficulty I have evaluating the case for the present special costs order. I was not the presiding judicial officer on the hearing of the application.

185 However, I have, as I have indicated, reviewed the transcript of the hearings. I have borne in mind the number of affidavits and their total page length, which in my view indicate the importance to the plaintiff of the application. I have also considered the total length of the hearings, of just under one hearing day, which might count against the making of a special costs order (if not strongly), when account is taken of the one day allowed for in the 2006 Determination item 10(a).

186 I have also reviewed the draft judgment of Le Miere J. That judgment deals with a wide range of issues, including whether or not the discretion to make the order for security for costs was enlivened, and the relevance of the defendants' delay in making their application to the exercise of his discretion. I note that his Honour refers to three matters of 'particular significance' in his determination that he should not make the order sought by the defendants. Two of the three related to the matter of delay in the defendants making their application.

187 In all of the circumstances, approaching the matter as EDWF Holdings 1, Heartlink and Verdell indicate I should, I consider I should allow the taxation to proceed without reference to the upper limit imposed by item 10(a) in the 2006 Determination. I consider I have a basis for an uplift of the maximum daily rate for counsel used to calculate the upper limit in item 10(a) as well as an uplift in the number of days provided for in that item. I so consider because I have evidence of an hourly rate used by counsel for the plaintiff to charge for the work which hourly rate is above the maximum hourly rate for counsel under the 2006 Determination; I also have the considerations I will shortly describe.

188 The hourly rate for counsel for the plaintiff is shown as $350 per hour before GST in his memo of counsel fees dated 30 April 2007 annexed to the affidavit of Mrs Frigger of 2 April 2009. That hourly rate inclusive of GST, on the basis of the amount charged by counsel, equated to $375.51. That compares with the maximum hourly rate of $286 inclusive of GST under the 2006 Determination. That memo contains items relating to the security for costs application.

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189 The considerations of the importance of the application to the plaintiff, facing a possible need to provide security for costs in a very short period before trial, considered with the features of the application referred to in the submissions of the plaintiff, leads me to conclude it is fairly arguable that time of counsel was properly required in and for the hearing of the application for which the allowance by 2006 Determination item 10(a) would be inadequate.

190 I turn now to the next special costs order sought.

Special costs orders: first day of trial 7 May 2007 as well as 2 November 2007

191 The plaintiff's minute refers in cl 4(d) to 'Counsel fees for two "first day" of trial 7 May 2007 and 2 November 2007 Scale Item 19(a)'. Counsel for the plaintiff explained that this special costs order was to allow for the plaintiff's position that the trial had two first days, and that the fate of the application for the present special costs order depended in part on that of the application for the reserved costs of that day. I have already indicated why I consider no order as to costs in respect of the failure to have a first day of trial on 7 May 2007 is appropriate, except as to the costs of the return of the subpoenas as costs in the cause.

192 It follows I would not make the special costs order sought. I turn now to the next special costs order sought.

Special costs orders: directions hearing on 14 May 2007

193 The plaintiff's minute refers in cl 4(e) to 'Directions Hearing on 14 July 2007 Scale Item 10(a)'. The reference to '14 July' was on the plaintiff's oral submissions an error: 14 May was meant.

194 So understood, it may be briefly dealt with, as the fate of the present application depended in part on the fate of the application for the reserved costs of that day. I have already indicated why I consider no order as to the costs of that day is appropriate.

195 It follows I would not make the special costs order sought. I turn now to the next special costs order sought.

Special costs orders: trial

196 The plaintiff's minute refers in cl 4(f) to 'Trial Scale Item 19(a), (c), (e) - (g)'. The amount allowable under the 2006 Determination is stated in the plaintiff's written submissions to be $50,787, which the plaintiff's

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minute would indicate to be the amount derivable from 2006 Determination item 19(a) (for the first day, including fee on brief) and item 19(c), (e) and (f) (for subsequent trial days). Counsel for the plaintiff at the hearing on 17 December 2008 told me the amount was arrived at by reference to counsel fees for items 19(a) and (c), which as I have already indicated set upper limits using the maximum daily rate for counsel; and to fees for a solicitor from the plaintiff's then firm of solicitors attending the trial, for item 19(e). Item 19(e) sets an upper limit by reference to the rate per hour of $363, which is the maximum hourly rate for a senior practitioner under the 2006 Determination. However, counsel for the plaintiff made no reference to a clerk or paralegal from the plaintiff's then firm of solicitors attending the trial for the purposes of item 19(f). That item sets an upper limit by reference to the rate per hour of $176 which is the maximum hourly rate for a clerk/paralegal under the 2006 Determination. It would appear then that the item references in the plaintiff's minute should be item 19(a), (c) and (e), as item 19(f) would not apply.

197 I have excluded the day for closing submissions as that day is on my understanding of the matter the subject of the next application for a special costs order, for closing submissions, below.

198 Finally, I note that the plaintiff's submissions did not as I understood them attempt to make a case for an uplift in respect of 2006 Determination item 19(g), referred to in the plaintiff's minute cl 4(f), which is for attendance on a reserved judgment. In any event, I see no case for such an uplift on the materials before me.

199 The plaintiff's submissions were, as I understood them, that there was unusual difficulty, complexity or importance which could be seen in the value of the judgment ($1,106,027); the duration of the relevant part of the trial (totalling from the records on the court's database approximately 49 hours, although the plaintiff's written submissions referred to the duration as 81 hours, which appears to include the final day of the trial); the number of documents in the trial bundle; the number of documents relevant to the capacity in which the plaintiff had acted at the material times that had to be discovered; the number of subpoenas (50); the lengthy cross-examination of Mrs Frigger; the cross-examination of the valuer Mr Spencer; and the late filing of the defendants' witness statements. There were also the orders of an 'interlocutory' kind made during the trial. All of these required more work after hours by the plaintiff's solicitors than normal.

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200 It is undoubtedly the case that the number of documents that had to be discovered relevant to the capacity in which the plaintiff had acted became significant but only in the run up to the trial. That reflected the importance that was attached to the issue by the defendants and that only became evident during that period. That importance was reflected in the defence only when the defence was amended by leave granted in October 2007. There was in my view an element of unusual difficulty for the plaintiff's conduct of the trial produced by this relatively late change.

201 However, it is also undoubtedly the case, as counsel for the defendants put to me, that the number of days a trial involves cannot itself be a basis for concluding the present element is satisfied. Further, the number of witnesses involved in this case (19 witnesses) and the number of documentary exhibits (182 exhibits) are not out of the ordinary for trials of this length. Finally, the judgment sum is hardly out of the ordinary for a trial of the duration of this one in this court. All of these considerations go most directly to that part of the present element concerned with unusual difficulty, of course.

202 However, approaching the matter as EDWF Holdings 1, Heartlink and Verdell indicate I should, I consider I should allow the taxation to proceed without reference to the upper limits imposed by items 19(a) and 19(c) in the 2006 Determination. I consider I have a basis for an uplift of the maximum daily rate for counsel used to calculate those upper limits as well as for an uplift in the number and length of the days allowed for by those items. I so consider for two reasons. One is that I have evidence of a daily rate for counsel for the plaintiff used to charge for the work that is above the maximum daily rate for counsel under the 2006 Determination. The other reason is made up of the considerations I will shortly describe.

203 I have already referred to the plaintiff's evidence for the first to the sixth days of the trial. That evidence is in the memo of counsel fees dated 11 December 2007 attached to the affidavit of Mrs Frigger of 2 April 2009, that counsel charged fees for attendances at the court at the rate of $3,500 per day before GST. Using the total amount shown in that memo as charged after GST, that daily rate equates to $3,850 inclusive of GST. That compares with the maximum daily rate for counsel of $3,102 inclusive of GST under the 2006 Determination.

204 The matters referred to by the plaintiff I have not put aside, when considered in combination, reflect for me the matters of unusual difficulty and of complexity which I referred to in relation to the special costs order for getting up. It seems to me then that there is a fairly arguable case to

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put to the taxing officer that the fee on brief and the hours of work by counsel was properly required in and for the trial days 1 - 10 for which the allowances made in the 2006 Determination items 19(a) and (c) would be inadequate.

205 Further, I consider I should, by reference to the considerations I have just described, allow the taxation to proceed without reference to the hours on trial days which the 2006 Determination 19(e) might otherwise set as the upper limit. However, I do not consider I have a basis for an uplift of the maximum hourly rate for a senior practitioner in relation to item 19(e). I have no evidence in that regard corresponding to that for counsel for the plaintiff.

206 I turn now to the next special costs order sought.

Special costs order: closing submissions

207 The plaintiff's minute refers in cl 4(g) to 'Closing submissions Scale Item 19(c) and (e)'. The plaintiff's written submissions state the maximum allowable under the 2006 Determination is $5,643, which the plaintiff's minute would indicate as derivable from 2006 Determination item 19(c) (for counsel) and (e) (for a senior practitioner), which I take to be applied to the last day of the trial, that on which closing submissions were presented.

208 While as counsel for the defendants reminded me, there is no separate item in the 2006 Determination for closing submissions, I consider that the work on such submissions is appropriately to be referred to 2006 Determination item 19(c) and (e), for the last day of the trial.

209 The plaintiff's submissions as I understood them were that there was unusual difficulty, complexity or importance which could be seen in the large number of tendered documents to be gone through, the length of the trial transcript (to which as I have indicated I had called for specific references in the closing submissions) and the length of the plaintiff's written closing submissions including supplementary material called for (184 pages) and of the defendants' written closing submissions also including such supplementary materials (182 pages). I should add that I had anticipated when I called for written closing submissions that I would receive ones in such detail, and I found the submissions prepared to be of considerable assistance.

210 Approaching the matter in the manner EDWF Holdings 1, Heartlink and Verdell indicate I should, I consider I should allow the taxation to

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proceed without reference to the upper limit imposed by item 19(c) in the 2006 Determination applied to 29 February 2008, the last day of the trial. I consider I have a basis for an uplift of the maximum daily rate for counsel used to calculate that upper limit as well as the time length of the day provided for in that item. I so consider for two reasons. One is that I have evidence of a daily rate and an hourly rate for counsel for the plaintiff used to charge for the work above the corresponding rates for counsel under the 2006 Determination. The other reason is made up of the considerations I will shortly describe.

211 The evidence is in the memo of counsel fees dated 4 March 2008 annexed to the affidavit of Mrs Frigger of 2 April 2009, which shows counsel charged fees for attendance at the court on 29 February 2008 at the rate of $3,500 per day and charged fees for other work relating to that day at the rate of $350 per hour, in both cases before GST. I have already compared those rates plus GST with the corresponding rates under the 2006 Determination.

212 The matters referred to by the plaintiff, in combination, indeed in my view reflected the matters of unusual difficulty and of complexity to which I referred in relation to the special costs order for getting up. It seems to me then that there is a fairly arguable case to put to the taxing officer that hours of work by counsel were properly required in and for the trial day of 29 February 2008 for which the allowance made in 2006 Determination item 19(c) would be inadequate.

213 Further, I consider I should, by reference to the considerations I have just described, allow the taxation to proceed without reference to the hours on that trial day which the 2006 Determination 19(e) might otherwise set as the upper limit. However, I do not consider I have a basis for an uplift of the maximum hourly rate for a senior practitioner in relation to item 19(e). I have no evidence in that regard corresponding to that for counsel for the plaintiff.

214 I turn now to the next special costs order sought.

Special costs orders: the freezing orders

215 The plaintiff's minute refers in cl 4(h) to 'Freezing Orders Scale Item 10(a)'. It is common ground that this related to an application by chamber summons by the plaintiff dated 8 January 2008. Following an ex parte hearing before me that day I granted the application. The orders I made were varied on 11 January 2008 by Hasluck J on the application of the defendants following a hearing before him that day. In both cases

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costs were reserved to the judge hearing the application on the return date. I have previously referred to the allowance by 2006 Determination item 10(a).

216 The plaintiff's submissions as I understood them were that there was unusual difficulty, complexity or importance which could be seen in the application having to be on very short notice because of the risk to the plaintiff; the long ex parte hearing before me (2 hours and 45 minutes); the second hearing, before Hasluck J; and the requirement to comply with the freezing orders including advising third parties, checking the asset schedule of the defendants, extensive correspondence between the parties concerning compliance, breaches of the orders and requests for further information.

217 I have no affidavit evidence as to those last six matters. However, I consider that the feature of the application they appear to me to go to, the complexity of the defendants' affairs, is sufficiently made out by the matters put to me at the hearing on 8 January 2008, and appears to have led to the application to Hasluck J.

218 In my view approaching the matter as EDWF Holdings 1, Heartlink and Verdell indicate I should, I consider I should allow the taxation to proceed without reference to the upper limit imposed by item 10(a) in the 2006 Determination. I consider I have a basis for an uplift of the maximum daily rate for counsel used to calculate the upper limit in item 10(a) as well as for an uplift of the number of days provided for in that item. I so consider for two reasons. One reason is that I have evidence of an hourly rate used by counsel for the plaintiff to charge for the work which hourly rate is above the maximum hourly rate for counsel under the 2006 Determination. The other reason is made up of the considerations I will shortly describe.

219 The hourly rate for counsel for the plaintiff is shown as $350 before GST in his memo of counsel fees dated 4 March 2008 annexed to the affidavit of Mrs Frigger of 2 April 2009. That hourly rate inclusive of GST, on the basis of the amount charged by counsel, equated to $375.51. That compares with the maximum hourly rate of $286 inclusive of GST under the 2006 Determination. That memo contains items relating to the freezing orders application and hearings.

220 The considerations of the complexity of the affairs of the defendants coupled with the history of the hearings in relation to the freezing orders lead me to conclude there is a fairly arguable case to be put before the

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taxing officer that the hours of work by counsel in and for the hearing would be such that the maximum allowance made in the 2006 Determination item 10(a) would be inadequate.

221 I turn now to the final special costs order sought.

Special costs orders: directions hearing of 29 October 2007

222 The plaintiff's minute cl 4(i) refers to 'Directions 29 October 2007 Scale Item 10(a)'. It is common ground this is a reference to a hearing on that date before me to consider what in substance were three applications, one by the plaintiff, and two by the defendants. The plaintiff's application was for leave to file and serve a further expert's report. The defendants' applications were for further specific discovery of certain documents (including a related application to uplift from the court's file a previous affidavit of discovery for the plaintiff) and for vacating the trial dates. It will be recalled the trial was to begin on 2 November 2007. Following a hearing that occupied five hours 25 minutes, I granted the plaintiff's application and dismissed those of the defendants, with costs in the cause.

223 I have previously referred to the allowance by the 2006 Determination item 10(a).

224 The plaintiff's submissions as I understood them were that there was unusual difficulty, or complexity or importance which could be seen in the length of the hearing before me, involving applications by both parties, with six affidavits representing a total of 239 pages and the other papers filed for the hearing, comprising a chamber summons, minute of proposed orders, and memorandum of conferral.

225 I should immediately state that there is nothing of an unusually difficult, complex or important character necessarily to be derived from the combination of the foregoing items.

226 However, I note that the bulk of the hearing was devoted to the application for discovery as it related to the capacity in which the plaintiff had acted at the material times and the plaintiff's claim for lost investment opportunity. Those matters were of major importance in the trial shortly to be held as indicated by the defendants' position that the fate of their application to vacate the trial dates turned on the fate of their application for discovery, and those matters were of some complexity, as is indicated in Computer Accounting & Tax.

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227 Approaching the matter as EDWF Holdings 1, Heartlink and Verdell indicate I should, I consider I should allow the taxation to proceed without reference to the upper limit imposed by item 10(a) in the 2006 Determination. I consider I have a basis for an uplift of the maximum daily rate for counsel used to calculate the upper limit in item 10(a) as well as for an uplift of the number of days provided for in that item. I so consider for two reasons. One reason is that I have evidence of an hourly rate used by counsel for the plaintiff to charge for the work which hourly rate is above the maximum hourly rate for counsel under the 2006 Determination. The other reason is made up of the considerations I will shortly describe.

228 The evidence is in the memo of counsel fees of counsel for the plaintiff dated 16 November 2007, annexure '2' to the affidavit of Mrs Frigger of 4 March 2009 (that is, the fresh evidence). This evidence shows counsel charged fees for attendance at the directions hearing of 29 October 2007 at the rate of $3,500 per day, and charged fees for other work relating to that hearing at the rate of $350 per hour, in both cases before GST. I have already compared those rates plus GST with the corresponding rates under the 2006 Determination.

229 The matters referred to by the plaintiff, when considered with the further matters I have just referred to, familiar to me as the judge who presided at the hearing on 29 October 2007, did indeed reflect the importance of the hearing to the plaintiff and the complexity of the issues addressed at that hearing, and lead me to conclude there is a fairly arguable case to put to the taxing officer that work by counsel was properly required for which the allowance made in 2006 Determination item 10(a) would be inadequate.

230 I turn now to the matter of the costs of this application.

Costs of this application

231 The defendants' minute includes in cl 5 that 'there be no order as to the costs of this hearing'. No submissions were directed by either party to the matter, however.

232 I consider the general approach I should follow is that in Verdell [33] (Wheeler J) where her Honour said this:

So far as the costs of the application are concerned, I have made a number of special costs orders. The plaintiffs have been largely successful, and in particular, I have not accepted the defendant's submission that I should concern myself with questions of duplication arising out of changes of

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solicitor and the like. For reasons which I will come to later, I have also not accepted the defendant's submissions in relation to questions of extension of time. It therefore seems to me appropriate that the defendant pay the plaintiff's costs of this application to be taxed.

233 This approach is in my view an application of the general rule that a successful party is entitled to its costs.

234 In my view the plaintiff was largely successful in respect of the costs of the action, as successful as the defendants in relation to the application for the costs of the transcript, largely if not entirely unsuccessful as to reserved costs, and largely successful as to special costs. I leave out for this purpose the matter left over for further argument, as to the costs of the Magistrates Court proceedings, the costs reserved to the trial judge in the District Court.

235 My conclusion is that, assessing the likely financial significance of the items referred to as best I can, and the parties' relative success in the submissions put to me in relation to them, the appropriate order for the costs of the present application is that for the costs of the action which is costs in the cause. I exclude for this purpose the costs of this application in relation to the costs of the Magistrates Court proceedings, costs on which are reserved to await the outcome of the further hearing in relation to them.

Orders

236 I will hear from the parties as to the terms of the orders I should make to give effect to my conclusions, and as to the application with respect to the costs of the Magistrates Court proceedings.

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Computer Accounting and Tax Pty Ltd v Professional Services of Australia Pty Ltd

[2008] WASC 133 (S)

9 JULY 2008

Supreme Court of Western Australia

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COMPUTER ACCOUNTING AND TAX PTY LTD -v- PROFESSIONAL SERVICES OF AUSTRALIA PTY LTD [2008] WASC 133 (S)

Link to Appeal : [2009] WASCA 183 [2009] WASCA 183(S) [2011] WASCA 80

Link to Appeal :
[2009] WASCA 183 [2009] WASCA 183(S) [2011] WASCA 80