Council of the Law Society of the Australian Capital Territory v LP 201920 (David Chen) (Occupational Discipline) - [2022] ACAT 101

ACT CIVIL & ADMINISTRATIVE TRIBUNAL

COUNCIL OF THE LAW SOCIETY OF THE AUSTRALIAN CAPITAL TERRITORY v LP 201920 (DAVID CHEN) (Occupational Discipline)
[2022] ACAT 101

OR 20/2019
Catchwords: OCCUPATIONAL DISCIPLINE – costs – costs assessment – powers of the Registrar to assess costs pursuant to the ACT Civil and Administrative Procedure Rules 2020 – principles of the tribunal under the ACT Civil and Administrative Tribunal Act 2008 – where procedures are to be as inexpensive as is consistent with achieving justice – Registrar to determine procedure for costs assessment – decision to conduct assessment on the papers without holding a hearing – order for assessed costs made

Legislation cited: ACT Civil and Administrative Tribunal Act 2008 ss 7, 48, 54

Legal Profession Act 2006 ss 425, 433

Subordinate
Legislation cited: ACT Civil and Administrative Tribunal Rules 2020 r 71

Court Procedures Rules 2006 r 1700, 1722, 1752

Cases cited:Council of the Law Society of the Australian Capital Territory v LP 201920 (David Chen) [2020] ACAT 31

Tribunal: Deputy Legal Registrar Corby

Date of Orders:  30 November 2022
Date of Reasons for Decision:         30 November 2022
AUSTRALIAN CAPITAL TERRITORY          )
CIVIL & ADMINISTRATIVE TRIBUNAL     )          OR 20/2019

BETWEEN:
COUNCIL OF THE LAW SOCIETY OF THE AUSTRALIAN CAPITAL TERRITORY
Applicant

AND:
LP 201920 (DAVID CHEN)
Respondent

TRIBUNAL: Deputy Legal Registrar Corby
DATE:30 November 2022

ORDER

The Tribunal orders that:

The respondent is to pay the applicant’s costs, pursuant to Rule 71(4) of the ACT Civil and Administrative Tribunal Rules 2020, totalling $75,187.06 calculated as follows:
(a)$72,712.06 assessed costs for the costs order dated 6 May 2022, comprised of:
(i)      $32,561.32 for the applicant’s costs;
(ii)     $2,965.65 for disbursements; and
(iii)   $37,185.09 for counsels’ fees; plus
(b)$2,475.00 for the costs of the assessment.
………………………………..
Deputy Legal Registrar W Corby

REASONS FOR DECISION

In July 2019 the Council of the Law Society of the Australian Capital Territory (the Law Society) applied to the ACT Civil and Administrative Tribunal (the tribunal or ACAT) for disciplinary orders under the Legal Profession Act 2006 (Legal Profession Act) arising from the professional conduct of the respondent who practised as a legal practitioner in the Australian Capital Territory (ACT).
On 6 May 2020 the tribunal made orders in relation to the application and published written reasons: Council of the Law Society of the Australian Capital Territory v LP 201920 (David Chen) [2020] ACAT 31.
Except in limited circumstances, parties to an application in the tribunal must bear their own costs.[1] Section 433 of the Legal Profession Act is an authorising law about costs orders in ACAT applications of this type. In this matter, pursuant to section 433, on 6 May 2020 the Tribunal ordered the respondent to pay the applicant’s legal costs of the proceedings at the rate of 90% of the solicitor‑client costs and disbursements in full as agreed or as assessed by the Registrar.
[1] See ACT Civil and Administrative Tribunal Act 2008 section 48
Rule 71 of the ACT Civil and Administrative Tribunal Rules 2020 (ACAT Rules) sets out the functions of the Registrar in assessing and making orders about costs, including:
(2)     An order for assessed costs may specify the scale or process for assessing costs.
(3)     If the tribunal makes an order for assessed costs, the registrar must assess the costs in accordance with the order and these rules.
(4)     At the end of a costs assessment the registrar must issue an order specifying—
(a)the assessed costs for the costs order; and
(b)the costs of the assessment.
(5)     If no order is made under subrule (2), the registrar may decide the scale and procedure to be followed to determine the assessed costs and the costs of the assessment.
The 6 May 2020 order specified the scale, but not the process by which the Registrar was to assess costs. As a result, it was open to the Registrar to decide the procedure to be followed.
Sub‑rules 71(6) and (7) of the ACAT Rules set out what the Registrar may decide to do, including:
(6) Without limiting the registrar’s power to assess costs, the registrar may decide to do any of the following:
(a)conduct a hearing by any means, including on the papers;
(b)require a bill of costs to be prepared;
(c)require a list of objections to items in a bill of costs to be prepared;
(d)apply a scale of costs under the Court Procedures Rules 2006;
(e)require the parties to attend a dispute resolution process;
(f)assess the costs in an amount agreed by the parties to the costs order without proceeding to a full assessment.
(7) The registrar may be informed of facts in any way the registrar considers appropriate.
The applicant lodged in the tribunal an application for interim or other orders dated 26 April 2022 seeking orders about costs (the applicant’s 26 April 2022 costs application). With that application, the applicant lodged an affidavit sworn by John Astley Buxton on 24 February 2022 annexing documents in support of the costs orders sought.
The matter was listed for a directions hearing on 7 June 2022 at which both parties attended. On 7 June 2022 directions were made giving the respondent the opportunity to provide a written response to the applicant’s 26 April 2022 costs application. The parties were encouraged to explore the possibility of an agreed outcome. The matter was listed for a further directions hearing on 9 August 2022.
On 4 August 2022 the applicant lodged an amended application for interim or other orders (the 4 August 2022 costs application) in which the applicant reduced the amount for costs it was seeking. In the 4 August 2022 costs application, the applicant acknowledged that in the 26 April 2022 costs application it had mistakenly included amounts that related to costs and disbursements that arose after the 6 May 2020 orders. In the 4 August 2022 costs application, the applicant sought an order for costs and disbursements of $81,522.06 comprising:
(a)$32,561.32 for solicitors’ costs;
(b)$43,520.09 for counsel’s fees;
(c)$2,965.65 disbursements; and
(d)$2,475.00 being the costs of the 4 August 2022 costs application.
The respondent’s submissions dated 3 August 2022 were sent to the tribunal and the applicant by email on Sunday, 7 August 2022 (the respondent’s 7 August 2022 submissions).
At the directions hearing on 9 August 2022, the applicant was directed to provide, by 23 August 2022, its reply to the respondent’s 7 August 2022 submissions. The parties were advised that if they were not able to agree on orders then, pursuant to rule 71(6)(a) of the ACAT Rules, the Registrar may decide to conduct the costs assessment on the papers. The applicant lodged its submissions in reply on 26 August 2022.
The ACAT Rules allow the Registrar to require a bill of costs to be prepared, and then for a list of objections to be filed. However, in this matter, I decided not to require a bill of costs, being satisfied that there is sufficient information on which to make the costs assessment based on the available material, being:
(a)the terms of the costs order made on 6 May 2020;
(b)the information provided by the applicant with the 26 April 2022 costs application and as amended in the 4 August 2022 costs application;
(c)the respondent’s 7 August 2022 submissions; and
(d)the applicant’s submissions in reply dated 26 August 2022.
Consistent with the principle that tribunal procedures are to be as simple, quick, inexpensive and informal as is consistent with achieving justice,[2] and pursuant to section 54 of the ACT Civil and Administrative Tribunal Act 2008 (ACAT Act) and rule 71(6)(a) of the ACAT Rules, on 30 September 2022 I made the order that the costs assessment would be conducted on the papers. Adopting this approach, and not requiring a bill of costs to be drawn, minimises the time and effort that the parties need to expend and avoids further costs being incurred.
[2] ACT Civil and Administrative Tribunal Act 2008 section 7
I do not intend to address on a line-by-line basis the objections raised by the respondent’s 7 August 2022 submissions responding to the information provided by the applicant. Rather, I have taken into account and more generally addressed the parties’ submissions.
Although not bound by the Court Procedures Rules 2006 (CPR), I have found it helpful to refer to the CPR as a guide in conducting this assessment. Rule 1752 of the CPR states that in assessing costs on a solicitor and client basis, the registrar must allow all costs reasonably incurred and of a reasonable amount, having regard to the costs allowable under rule 1722 and charges ordinarily payable by a client to a solicitor for the work. The scale at which costs are to be assessed is stated in the 6 May 2022 order to be 90% of the solicitor-client costs plus disbursements in full.
Rule 1700 of the CPR defines ‘costs of the proceeding’ to mean costs of all the issues in the proceeding, and includes costs ordered to be costs of the proceeding, costs of complying with the necessary steps before starting the proceeding, costs otherwise incurred for the purpose and benefit of the proceeding before starting the proceeding, and costs incurred before or after the start of the proceeding for successful or unsuccessful negotiations for settlement of the dispute.

Consideration of parties’ submissions

The respondent asserts that no order should be made for the costs claimed by the applicant prior to the lodgement of the 26 July 20219 ACAT application in relation to the substantive proceedings (the applicant’s 26 July 2019 application). I accept that the applicant is not entitled to recover, as costs of the proceedings, costs related to investigation and assessment of the complaint. However, I do not accept that all work done, and counsel’s fees for advice sought, in the period before the application was lodged in ACAT on 26 July 2019 is automatically excluded. In particular:
(a)I consider that costs that relate to the applicant’s 26 July 2019 ACAT application and that are included in the McInnes Wilson invoices dated 4 March 2019 and 1 May 2019 form part of this costs assessment.
(b)Similarly, counsel’s fees prior to 25 July 2019 for work done and advice that relates to the applicant’s 26 July 2019 application, and counsel’s fees after 25 July 2019 and until the 26 February 2020 hearing, are recoverable.
(c)I accept that Mr Lloyd’s invoice for $1,470.00 (exclusive of GST) dated 8 August 2019, for work done between 10 June and 18 July 2019 relates to the ACAT application.
(d)I am not satisfied that Mr Lloyd’s invoice for $6,335.00 (exclusive of GST) dated 11 March 2019 for work done between 21 November 2018 and 25 February 2019 relates to the ACAT application.
(e)I am satisfied that the invoices issued by Nick Beaumont SC dated 16 January 2020 for $8,651.00 (exclusive of GST) and 27 February 2020 for $27,064.09 (exclusive of GST) are recoverable.
I am not persuaded by the respondent’s submission that I should not allow costs which relate to the applicant seeking the order recommending that the respondent’s name be removed from the ACT Supreme Court roll. I am satisfied that it was open to the applicant to seek this order, pursuant to section 425 of the Legal Profession Act, given the agreed characterisation of the respondent’s conduct as set out in the Joint Statement dated 17 December 2019.
After the Joint Statement dated 17 December 2019 was lodged, the parties were to provide separate submissions about sanctions. I do not accept the respondent’s submissions that the applicant’s approach in relation to sanctions was ‘flawed’.
In the applicant’s 26 July 2019 application and again in the amended application dated 4 December 2019, the applicant clearly stated the costs order it sought. Given the Joint Statement dated 17 December 2019 and the operation of section 433 of the Legal Profession Act, it was clear that a costs order would be made in favour of the applicant unless the respondent established that exceptional circumstances existed. No application relating to costs was made by the respondent. At paragraph 181 of the reasons for the 6 May 2020 orders, the Senior Member stated: “[t]here was no dispute that there should be a public reprimand and an order for costs as sought by the [applicant].”
If the respondent considered that the approach that the applicant had adopted during the conduct of the proceedings should have been reflected in some way in the costs order that was made by the Tribunal, then I consider that is a matter that should have been raised at the time of, or soon after, the 6 May 2020 costs order. The presiding member who conducted the hearing was in the best position to consider and determine such an application by the respondent.
Having considered the Tribunal’s written reasons for the orders dated 6 May 2022 and the parties’ submissions in relation to costs, I am not persuaded that the respondent’s submissions in this regard provide any basis for reducing the costs payable to the applicant. I do not consider that as part of this assessment it is now appropriate to attempt to determine whether any, and if so what, aspect of the applicant’s costs should be disallowed on the basis of the respondent’s assertions in this regard. There is nothing in the Senior Member’s written reasons for the 6 May 2020 orders,[3] which suggests that the approach adopted by the applicant was inappropriate. Indeed, at paragraph 175 the Tribunal accepts that the respondent’s conduct as set out in the Joint Submissions dated 17 December 2019 “is so serious that unless I can be satisfied that the flaws that led him to do it are not permanent, the Tribunal should recommend that he be struck off.”
[3] Council of the Law Society of the Australian Capital Territory v LP 201920 (David Chen) [2020] ACAT 31
This statement supports the conclusion that the applicant’s approach was not inappropriate and that the respondent needed to provide compelling evidence before the Tribunal was satisfied it was appropriate to impose a sanction that was less onerous than that sought by the applicant.
In the substantive proceedings, by order dated 2 December 2019, the applicant was given leave to amend its application. The amended application was lodged on 4 December 2019 before the Joint Submissions dated 17 December 2019. No costs order was made in relation to that amendment. Again, if the respondent considered that an order about costs should have been made, then it would have been appropriate to have raised this at the time leave was granted, or when, or shortly after, the 6 May 2020 final orders were made. During the substantive proceedings interim costs orders were made on 6 November 2019 and 16 January 2020 in relation to other interim applications. I am not satisfied that any adjustment to costs should now be made in relation to the applicant’s 4 December 2019 amended application.
I am unable to say whether the parties might, in different circumstances, have reached agreement about the appropriate sanction. In this matter they did not. The Tribunal was therefore required to consider the appropriate orders in relation to the agreed matters and make a determination as to sanction. These issues were the subject of the hearing on 26 February 2020. That the parties had not agreed on sanction was not the subject of negative comment directed at the applicant in the Senior Member’s reasons for the decision dated 6 May 2020.
Until the Joint Submissions dated 17 December 2019 were signed, it cannot be said that the parties had agreed about the conduct, or the characterisation of that conduct, that was the subject of the complaint about the respondent, and which would be the subject of consideration about sanctions. The conduct alleged, that was ultimately agreed to in the Joint Submissions dated 17 December 2019, was very serious. I do not consider that it was unreasonable for the applicant to have briefed senior counsel in relation to the application, nor for counsel to appear at the hearing. I note that junior counsel was not briefed.
The only attendance at ACAT by counsel was at the final hearing on 26 February 2020. The travel costs were limited to taxi fares to and from the airport and airfares on that date. The 6 May 2020 costs order requires payment of the applicant’s disbursements in full. I consider counsels’ fees including disbursements (exclusive of GST) are payable in full for the invoices referred to in paragraphs 17(c) and 17(e) above.
As set out in the amended costs application dated 4 August 2022, the applicant no longer seeks counsel’s fees invoiced on 11 May 2022, 3 June 2022 or 15 September 2022. The applicant has restricted their costs and disbursements of this assessment to the McInnes Wilson Lawyers’ invoices dated 4 March 2019, 1 May 2019, 30 August 2019, 31 October 2019, 21 February 2020, 29 February 2020 and 30 April 2020.
I accept the respondent’s submissions that there are some amounts included in these invoices that are not reasonable, even on a solicitor-client basis, including where both Mr Buxton and Ms Binstock charged for attendances, and where Mr Buxton has settled work drafted by Ms Binstock, noting that both are senior practitioners. Having reviewed the invoices I have calculated, based on the amounts appearing in the invoices, an amount of just under $5,700.00 for work that may fall into these categories. However, if a bill of costs had been drawn, it may be that on a taxation not all of these amounts would be disallowed.
I accept, and it is relevant for the purpose of this costs assessment, that notwithstanding the 6 May 2020 costs order allows for recovery of 90% of the Supreme Court scale on a solicitor-client basis, the applicant has discounted the invoices provided in support of the 4 August 2022 costs application. The applicant relies on the discounted figure in seeking the orders set out in the 4 August 2022 costs application. I accept that had the applicant been required to prepare a bill of costs, even if no further costs had otherwise been sought, that process would have necessarily resulted in additional costs accruing which would likely have been recoverable from the respondent. I further accept that the discounted amount is well below 90% of the Supreme Court scale.
I do not accept the respondent’s assertion that the applicant should not recover the costs of the assessment because the applicant failed to attempt to negotiate costs before lodging the 26 April 2022 costs application. I accept that the applicant did attempt to engage in discussion with the respondent’s solicitor (or former solicitor) and then, at the solicitor’s suggestion, directly with the respondent. The costs order was made on 6 May 2020. It was at all times open to the respondent or his representative, and particularly after the related appeal proceedings were finalised, to approach the applicant about costs. This opportunity was still available after the costs application was made on 26 April 2022. In the circumstances of this matter, I do not consider that the applicant’s approach in lodging the costs application in ACAT should negatively impact on their entitlement to the costs of the assessment as set out in Rule 71(4)(b) of the ACAT Rules.
It appears from the figures provided in the respondent’s 7 August 2022 submissions that the respondent considers the applicant’s costs should be reduced to approximately $20,000.00.
I have reviewed the invoices provided in support of the applicant’s amended 4 August 2022 costs application and referred to in paragraph 28 above. Before any further discount is applied the McInnes Wilson Lawyers’ invoices total $50,094.35. Even if this amount were reduced by the full amount of $5,700 referred to in paragraph 29 above, the applicant’s allowable costs would still exceed the $32,561.32, being the discounted sum the applicant is seeking in the 4 August 2022 costs application.

I consider that the applicant is entitled to full disbursements as set out in the McInnes Wilson Lawyers’ invoices referred to in paragraph 28 above; and counsels’ fees and disbursements as set out in counsels’ invoices referred to in paragraphs 17(c) and 17(e) above.
Finally, as set out in paragraph 31 above, I consider that it was reasonable for the applicant to have made the application to ACAT for costs, initially, in April 2022. I note that the applicant did not, nor should they, seek any amount for the 4 August 2022 amendment to the costs application. I consider the amount of $2,475.00 sought for the costs incurred by the applicant in relation to the costs application is a reasonable amount, reasonably incurred on behalf of the applicant by its solicitors. They prepared and lodged the application for costs, attended the costs directions hearings and prepared, as required by order, submissions in reply to the respondent’s submissions. I accept that the applicant has billed their client more than this amount for this work.

Conclusion

I assess the applicant’s costs pursuant to Rule 71(4)(a) of the ACAT Rules for the costs order dated 6 May 2022 in the sum of $72,712.06 (the applicant’s assessed costs) comprised of:
(a)$32,561.32 for the applicant’s costs;
(b)$2,965.65 for disbursements; and
(c)$37,185.09 for counsels’ fees.
Pursuant to rule 71(4)(b) of the ACAT Rules I assess the applicant’s costs of the assessment at $2,475.00 (the ‘costs of the assessment’).
The respondent is to pay the applicant a total of $75,187.06 for the applicant’s assessed costs and the costs of the assessment as set out in paragraphs 36 and 37 above.
………………………………..
Deputy Legal Registrar W Corby

Date(s) of hearing	On the papers
Solicitors for the Applicant:	Ms K Binstock, McInnes Wilson Lawyers
Respondent:	David Chen