FEDERAL COURT OF AUSTRALIA
Coshott v Burke (No 3) [2019] FCAFC 23
Appeal from: Fewin Pty Ltd v Burke (No 3) [2017] FCA 693 File number: NSD 1137 of 2017 Judges: LOGAN, KERR AND FARRELL JJ Date of judgment: 14 February 2019 Catchwords: COSTS – applications for lump sum costs on an indemnity basis – whether costs should be fixed in a lump sum – whether circumstances justify the exercise of the Court’s discretion to award costs on an indemnity basis – where appellants’ conduct caused additional costs – costs awarded as a lump sum – appropriate discount to be applied to lump sum in the circumstances Legislation: Federal Court of Australia Act 1976 (Cth), ss 37M, 43
Federal Court Rules 2011 (Cth), r 40.02, Schs 1, 3
Cases cited: Beach Petroleum NL v Johnson (No 2) [1995] FCA 350; 57 FCR 119
Bobb v Wombat Securities Pty Ltd (No 2) [2013] NSWSC 863
Canvas Graphics Pty Ltd v Kodak (Australasia) Pty Ltd [1998] FCA 23
Coshott v Burke [2017] FCAFC 230
Coshott v Burke (No 2) [2018] FCAFC 81
Coshott v Prentice (No 2) [2018] FCAFC 1
Cristovao v Tan & Tan Lawyers Pty Ltd [2018] FCAFC 41; 16 ABC(NS) 123
Dunstan v Human Rights and Equal Opportunity Commission (No 3) [2006] FCA 916
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd [1988] FCA 364; 81 ALR 397
Hamod v New South Wales [2002] FCA 424; 188 ALR 659
Hancock v Rinehart (Lump sum costs) [2015] NSWSC 1640
Harrison v Schipp [2002] NSWCA 213; 54 NSWLR 738
Huang v Drumm [2017] NSWSC 1006
Hudson v Sigalla (No 2) [2017] FCA 339
In the matter of Palladium Consulting Pty Limited [2013] NSWSC 92
Julien v Department of Employment and Workplace Relations (No 2) [2009] FCA 1259
Keen v Telstra Corporation Ltd (No 2) [2006] FCA 930
LFDB v SM (No 2) [2017] FCAFC 207
Melbourne City Investments Pty Ltd v Treasury Wines Estates Ltd (No 2) [2017] FCAFC 116
Paciocco v Australia and New Zealand Banking Group Limited (No 2) [2017] FCAFC 146; 253 FCR 403
Starr-Diamond v Diamond (No 4) [2013] NSWSC 811
Su v Australian Fisheries Management Authority (No 3) [2008] FCA 2018
Webster v Super Smart Strategies Pty Ltd (No 3) [2017] NSWSC 930
Date of hearing: Determined on the papers Date of last submissions: 6 July 2018 Registry: New South Wales Division: General Division National Practice Area: Commercial and Corporations Sub-area: General and Personal Insolvency Category: Catchwords Number of paragraphs: 112 Counsel for the First Appellant: The first appellant appeared in person Solicitor for the Second Appellant: Murphy Lyons Lawyers Counsel for the First Respondent: Mr J T Johnson Solicitor for the First Respondent: J P Miskell & Associates Counsel for the Second and Fourth Respondents: Mr M J Heath Solicitor for the Second and Fourth Respondents: Australian Government Solicitor Counsel for the Third Respondent: Ms M Castle Solicitor for the Third Respondent: Gillis Delaney…
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- AGLC
- Coshott v Burke (No 3) [2019] FCAFC 23
- Case
- [2019] FCAFC 23
- Decision Date
CaseChat Overview and Summary
The Court of Appeal considered the extensive litigation history between the parties and the desirability of resolving the cost issue efficiently. It highlighted that the lump sum costs procedure is designed to streamline the determination of the quantum of costs rather than replicate the taxation process. The Court rejected the appellants' arguments against the lump sum costs order, including their inability to cross-examine the costs preparer and the fact that the respondent was initially unrepresented. The Court found that the hourly rates claimed by the solicitor were well within permissible limits. The Court concluded that making a lump sum costs order was practicable and appropriate given the circumstances.
The Court of Appeal determined that the appellants should pay the respondents' costs of the appeal as a lump sum, fixed at specific amounts for each respondent. This decision reflects the Court’s consideration of the procedural fairness and the necessity to avoid protracted and expensive taxation processes. The lump sum costs were fixed in the sum of $18,610.17 for the first respondent, $15,606.55 for the second and fourth respondents, and $40,699.58 for the third respondent. The orders were made under Rule 39.32 of the Federal Court Rules 2011.
Orders
Orders of the court
1. The appellants pay the first respondent’s costs fixed in the sum of $18,610.17.
2. The appellants pay the second respondent’s costs fixed in the sum of $15,606.55.
3. The appellants pay the third respondent’s costs fixed in the sum of $40,699.58.
4. The appellants pay the fourth respondent’s costs fixed in the sum of $15,606.55.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
In conclusion, the appellants submit that a lump sum costs order is not practical and appropriate in the circumstances, but if the Court is minded to make such an order, the costs claimed should be discounted by at least 30%. The appellants submit that the fact that Mr Miskell deposes at [12] of his affidavit that the costs sought were claimed on a “solicitor and own client basis” rather than on the “ordinary basis” supports the appellants’ position.Consideration The Court is of the view that in all of the circumstances of the present proceedings, it is practicable and appropriate to order that the appellants pay Mr Burke’s costs of the appeal as a lump sum. We have reached that conclusion having had regard to the voluminous litigation commenced by the appellants in relation to costs orders, and the desirability of resolving the issue of the costs of this appeal as efficiently, and with as little additional costs, as possible. In that regard, we note our observations in Prentice at [19]:The circumstances in which a lump sum order will be made are not confined to matters limited in complexity but often that will be appropriate. Moreover as was noted in LFDB v SM (No 2) [2017] FCAFC 207 it may be appropriate to avoid a lengthy and expensive taxation where there has been prior protracted “trench warfare” between the parties. … We reject the appellants’ assertion that their inability to cross-examine Mr Miskell on the content of his affidavit and to inspect and comment upon the source material relied upon in calculating the quantum of costs weigh against the making of a lump sum costs order. As is clearly articulated in the Costs Practice Note at [4.11], the lump sum costs procedure is intended to “streamline and expedite the determination or resolution of the quantum of costs question and not to replicate the taxation process.” In making an order for costs as a lump sum, the Court does not conduct a line-by-line assessment of the costs claimed, and the Court does not require the Costs Summary to exhibit the source material verifying the costs and disbursements claimed: seethe Costs Practice Note at [4.12]. However, Mr Miskell has annexed the invoices rendered by counsel to his affidavit, and deposes that his firm’s file records, including invoices and receipts, are able to be produced to the Court if required (at [25]). We reject the appellants’ submission that Mr Burke’s costs should not be awarded in a lump sum because he was unrepresented until 3 November 2017. Although the appellants correctly identify that a Notice of Acting with respect to Mr Burke was not filed until 3 November 2017, that notice was signed by Mr Miskell and dated 23 July 2017, only 12 days after the appellants filed their Notice of Appeal. Mr Miskell deposes that his fees are below the maximum hourly rate permitted in Sch 3 to the Rules, which he identifies as $580. In fact, the maximum hourly rate permitted for a solicitor pursuant to Sch 3 is $550. However Mr Miskell’s fees, being $440 per hour, are well below that limit.