Daley v Hughes

Case •

[2014] NSWCA 268

•

18 August 2014

Court of Appeal


Supreme Court


New South Wales

  • Amendment notes
Medium Neutral Citation: Daley v Hughes [2014] NSWCA 268
Hearing dates:14 July 2014
Decision date: 18 August 2014
Before: Meagher JA at [1];
Emmett JA at [12];
Tobias AJA at [38]
Decision:

1. Grant the applicants leave to appeal.

2. Appeal allowed.

3. Set aside the orders made by Davies J on 30 August 2013 other than so much of Order 1 as dismissed the appellants' cross-summons with costs.

4. Dismiss the summons filed by the respondent in the Common Law Division of the Court on 19 March 2013.

5. The respondent to pay the appellants' costs of the summons filed on 19 March 2013 and of the summons for leave to appeal and the appeal but to have with respect to the latter a certificate under the Suitors' Fund Act 1951 (NSW) if otherwise qualified.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Catchwords: APPEAL - competency of an appeal to the Common Law Division of the Supreme Court from reasons given by a costs assessor - whether the reasons constituted a "decision" within s 208L of the Legal Profession Act 1987 (NSW)
Legislation Cited: Administrative Appeals Tribunal Act 1975 (Cth), ss 44(1), 46
Commercial Tribunal Act 1994 (NSW), s 20
Consumer Credit Act 1972 (SA), s 25
Government and Related Employees Appeal Tribunal Act 1980 (NSW), s 54
Legal Profession Act 1987 (NSW), Div 2 Pt 11, Div 3 Pt 11, Div 6 Pt 11
Motor Accidents Compensation Act 1999 (NSW), s 149
Motor Accidents Compensation Regulation (No 2) 1999 (NSW), Pt 3, Sch 1
Uniform Civil Procedure Rules 2005 (NSW), Pt 28, r 50.3
Cases Cited: Australian Broadcasting Tribunal v Bond [1990] HCA 33; (1990) 170 CLR 321
Bromley v Housing Commission of NSW (1985) 3 NSWLR 407
Clisdell v Commissioner of Police (1992) 31 NSWLR 555
Commonwealth v Bank of New South Wales (1949) 79 CLR 497
Currabubula & Paola v State Bank of New South Wales [2000] NSWSC 232
Custom Credit Corporation Ltd v Commercial Tribunal of New South Wales (1993) 32 NSWLR 489
Director-General of Social Services v Chaney [1980] FCA 87; (1980) 47 FLR 80
Hughes v Geraldine Daley trading as Colin Daley Quinn, Solicitors And Barristers [2013] NSWSC 806
Hughes v Geraldine Daley trading as Colin Daley Quinn, Solicitors And Barristers (No 2) [2013] NSWSC 1213
Kostas v HIA Insurance Services Pty Limited [2010] HCA 32; 241 CLR 390
Mobitel (International) Pty Ltd v Dun & Bradstreet (Australia) Pty Ltd (1979) 22 SASR 288
Category:Principal judgment
Parties: Geraldine Anne Daley (First Applicant / Appellant)
Timothy Daley (Second Applicant / Appellant)
Amanda Hughes (Respondent)
Representation:

Counsel:
R Parker SC / M Castle (Applicants / Appellants)
M Brabazon SC (Respondent)

Solicitors:
DGT Costs Lawyers (Applicants / Appellants)
Diamond Conway (Respondent)
File Number(s):2013/287998
Publication restriction:None
 Decision under appeal 
Jurisdiction:
9111
Citation:
Hughes v Geraldine Daley trading as Colin Daley Quinn, Solicitors And Barristers [2013] NSWSC 806 (25 July 2013)
Hughes v Geraldine Daley trading as Colin Daley Quinn, Solicitors And Barristers (No 2) [2013] NSWSC 1213 (30 August 2013)
Date of Decision:
30 August 2013
Before:
Davies J
File Number(s):
2013/84085

HEADNOTE

[This headnote is not to be read as part of the judgment]

In 2003, the respondent retained the applicants, who were solicitors, to act for her in a claim arising from a motor vehicle accident. The applicants did not make a costs disclosure to the respondent until 2005. The applicants engaged counsel on behalf of the respondent, whose costs estimate was not disclosed to the respondent until one month before the matter settled in 2011.

The claim settled in the sum of $750,000, from which the respondent paid $240,570 to the applicants in legal costs. The respondent then sought a costs assessment, arguing that the applicants were only entitled to costs in an amount capped by operation of the Motor Accidents Compensation Regulation (No 2) 1999 (NSW) in the sum of approximately $30,000. The applicants argued that they had contracted out of the statutory caps, pursuant to clause 11 of the Motor Accidents Compensation Regulation 1999 (No 2) which provided, relevantly, that legal costs would not be subject to the caps if the legal practitioner made a costs disclosure under Div 2 of Pt 11 of the Legal Profession Act 1987 (NSW).

The costs assessor issued what he described as "Draft Reasons" in which he indicated he would proceed to assess costs on the basis that the caps applied from the time the retainer commenced in 2003 until the time a costs disclosure was made in 2005, and did not apply thereafter. The respondent brought an appeal in the Supreme Court against what she contended was a "decision" of the costs assessor pursuant to s 208L of the Legal Profession Act 1987. The primary judge found that the appeal was competent and that the applicants' fees were subject to the caps because they had not fully complied with their costs disclosure obligations.

The applicants appealed, arguing that the appeal against the costs assessor's "Draft Reasons" was incompetent because the costs assessor had not made a decision within the meaning of s 208L, and that they were entitled to uncapped costs notwithstanding the defects in disclosure; or in the alternative, that only counsel's costs should be capped.

The Court held:

1. The costs assessor's "Draft Reasons" were no more than an expression of intention as to the how he would complete the assessment. Those reasons were not binding on the parties or on the costs assessor. Accordingly, it was not a "decision" from which an appeal could be brought pursuant to s 208L of the Legal Profession Act 1987. The legislature intended that appeals against decisions of costs assessors could only be brought at the end of the assessment process or at least only upon a formal determination by the costs assessor: [3], [9]-[11], [77]-[84].

Director-General of Social Services v Chaney [1980] FCA 87; (1980) 47 FLR 80; Australian Broadcasting Tribunal v Bond [1990] HCA 33; (1990) 170 CLR 321 Clisdell v Commissioner of Police (1992) 31 NSWLR 555; considered.

Currabubula & Paola v State Bank of New South Wales [2000] NSWSC 232; overruled as to the construction of s 208L of the Legal Profession Act 1987 (NSW).

2. Because the appeal from the costs assessor's "Draft Reasons" was incompetent, the primary judge had no jurisdiction to entertain it. This Court therefore also lacked jurisdiction to determine whether the applicants' costs are subject to the statutory caps: [84]-[85].

Judgment

  1. MEAGHER JA: The applicant solicitors and the respondent are in dispute as to the costs which the applicants are entitled to recover for acting on the respondent's behalf in relation to a motor accident claim. The respondent applied for an assessment of those costs which was referred to a costs assessor to be dealt with in accordance with Division 6, Part 11 of the (now repealed) Legal Profession Act 1987 (NSW) (LP Act). The applicants seek leave to appeal from orders made by the primary judge (Davies J) allowing an appeal by the respondent from what is said to be a "decision" of that costs assessor: Hughes v Geraldine Daley (No 2) [2013] NSWSC 1213. The reasons for those orders were published earlier: Hughes v Geraldine Daley [2013] NSWSC 806.

  1. An issue before the primary judge, which is the subject of the proposed appeal (ground of appeal 3), is whether there was within the meaning of s 208L of the LP Act a "decision" of that costs assessor as to a matter of law arising in the assessment proceedings. If there was not, there was no right of appeal to the Supreme Court except with leave.

  1. I agree with Tobias AJA that the draft reasons issued by the cost assessor in February 2013 did not constitute a "decision" that could be the subject of an appeal to the Supreme Court as of right. I do so for the reasons given by his Honour and those which follow. I also agree with the orders which his Honour proposes.

  1. In ss 208L and 208M the distinction is between "a decision of a costs assessor as to a matter of law arising in the proceedings to determine the application" and "the determination of the application made by a costs assessor". [Emphasis added]

  1. Division 6 provided for the making of applications, including by a client of a solicitor, for the assessment of the costs in a bill of costs (ss 199, 200, 201). Once made, the application was referred to a costs assessor to be dealt with under that Division (s 206). There were circumstances in which the assessor could decline to deal with the application (s 207) and circumstances in which the assessor was required to decline to assess a bill. That was so if the disputed costs were the subject of a costs agreement which either specified the amount of the costs which would be charged or the rate for calculating those costs where the dispute related only to that rate (s 208C). There was no such requirement if the assessor determined that the relevant provisions of the costs agreement were unjust under s 208D or that the barrister or solicitor had failed to make a disclosure of the matters required to be disclosed under ss 175 or 176. The assessor was empowered also to determine whether there was a costs agreement and whether disclosure under Division 2 had been made for the purpose of determining if the application for assessment "may be or is required to be made" (s 208).

  1. Otherwise the assessor was required "to determine the application by confirming the bill of costs or, if the assessor is satisfied that the disputed costs are unfair or unreasonable, by substituting for the amount of the costs an amount that, in his or her opinion, is a fair and reasonable amount" (s 208A(2)). Once a determination was made, the costs assessor was required to issue a certificate setting it out (s 208J(1)). More than one certificate could be issued in relation to an application for assessment of costs (s 208J(1A)).

  1. The subject matter of the determination and certificate was the amount of costs assessed as due (s 208A(2)). Depending on the relationship between that amount and the amount of costs already paid, any balance, either overpaid or to be paid, could be recovered by the relevant party as a debt due (ss 208J(2), (3)). A certificate issued under s 208J also had to be accompanied by a statement of reasons (s 208JAA). The determination was binding on all parties subject only to the rights of review or appeal provided by Division 6, Subdivisions 4A and 4B. The right of review was by a panel of two costs assessors (s 208KB). On completion of its review, the panel also was required to issue a certificate setting out its determination (s 208KF). That determination, subject to limited rights of appeal given by ss 208L(1) and 208M(1), was binding on the parties to the assessment (s 208KI).

  1. In Clisdell v Commissioner of Police (1993) 31 NSWLR 555, Sheller JA (Handley and Cripps JJA agreeing) said (at 558-559) of the statutory right of appeal in s 54 of the Government and Related Employees Appeal Tribunal Act 1980 (NSW), which was "against any decision of the Tribunal on a question of law":

"An appeal from a decision of a court is from an order or other judicial act which affects adversely the rights claimed by the appellant party. It is not an appeal from a pronouncement by the court of an opinion upon a question of law; ... It is directed to modifying or reversing the action of the court appealed from. "Decision" may not have the same connotation in the context of curial power to review an administrative decision. Even so, in Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at 338, Mason CJ quoted with approval the tentative opinion expressed by Ellicott J, in Ross v Costigan (1982) 59 FLR 184 at 197 that the word "decision" means an ultimate or operative determination not a mere expression of opinion or a statement which can of itself have no effect on a person. The Chief Justice said that he would not wish for himself to place emphasis on the words "of itself" in this statement."
...
"However, if in accordance with the general understanding of the expression "appeal from a decision", one translates "decision" to "order" or "judgment", used in the sense of an act affecting adversely the rights claimed by the appellant, the qualification "on a question of law" is meaningless. It seems to me, therefore, that "decision" in s 54 is used to include an opinion of the tribunal on a question of law upon which its action or decision, as generally understood, is based."

  1. There was no provision in the LP Act permitting a costs assessor or panel to make a separate decision as to any question of law or providing a right of appeal in relation to the making of such a decision: cf the provisions of s 20 of the Commercial Tribunal Act 1984 (NSW) considered in Custom Credit Corporation Ltd v Commercial Tribunal of New South Wales (1993) 32 NSWLR 489. In the absence of such a provision, a view reached by an assessor or review panel on a question arising in the determination of the costs assessment application does not take on the character of a decision having an effect between the parties until a binding determination is made. Until then it remains an expression of opinion or intention which may be altered or abandoned. However, as French CJ observed in Kostas v HIA Insurance Services Pty Ltd [2010] HCA 32; 241 CLR 390 at [23], where the final or operative determination has been made, a right of appeal against a decision on a question of law extends to any decision, whether or not made explicit, which was a necessary step in the reasoning to the conclusion on which that determination is based.

  1. The purported "decision" of the costs assessor was not one which of itself had any immediate operative effect as between the parties. Nor was it a decision which had been made as a necessary step in the process of reasoning leading to a binding determination of any aspect of the application because no such determination was made. That there can be no "decision" within s 208L unless there has been such a "determination" in relation to the application is confirmed by the provisions of sub-sections 208L(2) and (3) which assume that such a "determination" has been made. They provide that after deciding the question the subject of the appeal, the Supreme Court may make "such determination in relation to the application as, in its opinion, should have been made" or remit its decision on that question to the assessor and order him or her to "re-determine the application".

  1. The present is not a case where the language of the statute clearly authorises the bringing of what effectively would be an interlocutory appeal on a question of law so as to involve the Supreme Court in close supervision of the assessment proceedings. On the contrary, that language limits the rights of the parties to appeals by leave against binding determinations of an assessor or panel and as of right from any decision on any matter of law involved in those binding determinations: cf Custom Credit Corporation Ltd at 493 (Gleeson CJ) and 497 (Kirby P), the latter passage referring to the decision of Samuels JA in Bromley v Housing Commission of NSW (1985) 3 NSWLR 407 at 425 where his Honour emphasised the need for caution in adopting an interpretation of provisions such as these which would facilitate the bringing of interlocutory appeals.

  1. EMMETT JA: These proceedings arise out of an injury suffered by the respondent, Ms Amanda Hughes, involving a motor vehicle. However, the dispute is between Ms Hughes and her former solicitors, who acted for her in claiming damages under the Motor Accidents Compensation Act 1999 (NSW) (the Compensation Act). Ms Hughes challenges the fees charged to her by her former solicitors, who are the present applicants for leave to appeal (the Solicitors). The questions raised in the proceedings are whether Ms Hughes had a right of appeal from a ruling by a costs assessor and, if so, whether the ruling was erroneous. The questions arise in the context of the provisions of the Compensation Act that provide for maximum costs recoverable by legal practitioners for legal services provided to a claimant in a motor accidents matter.

Factual Background

  1. Ms Hughes was injured in a motor vehicle accident on 31 March 2001. On 20 June 2001, the relevant insurer admitted liability for the injury she had suffered and, on 30 July 2002, made an offer of settlement of $2,157. Ms Hughes regarded that offer as unacceptable.

  1. On 17 July 2003, having previously been represented by other solicitors, Ms Hughes instructed the Solicitors to act for her. On 9 July 2004, Ms Hughes gave instructions to the Solicitors to brief Mr Paul Jones of counsel and a brief was sent to Mr Jones on 14 July 2004.

  1. Apparently due to an oversight, it was not until 14 July 2005 that the Solicitors sent a costs agreement to Ms Hughes. The material enclosed with the proposed costs agreement included an estimate of the fees that might be charged by the Solicitors. However, nowhere in the material was an estimate provided of the fees that might be charged by Mr Jones, notwithstanding that Mr Jones had provided an estimate to the Solicitors less than a week beforehand. Ms Hughes subsequently entered into the costs agreement with the Solicitors.

  1. On 15 November 2011, Ms Hughes conferred with the Solicitors and Mr Jones to consider a possible settlement of Ms Hughes's claim under the Compensation Act. The Solicitors had prepared a settlement sheet and they discussed with Ms Hughes the figure that she would receive in her hand from the offer that was proposed in the settlement sheet. The Solicitors' costs were identified in the settlement sheet with some precision. The Solicitors provided Ms Hughes with a copy of the settlement sheet containing the figures. That was the first occasion when Mr Jones's estimate of fees had been disclosed to Ms Hughes.

  1. Ms Hughes's claim was ultimately settled on 19 December 2011 for $750,000. The Solicitors informed her that she would receive $500,000 after the deduction of costs. That sum was paid to Ms Hughes on 1 February 2012.

  1. Ms Hughes then retained new solicitors, who wrote to the Solicitors requesting an itemised bill of costs. On 1 August 2012, Ms Hughes made an application for a costs assessment in respect of the Solicitors' bill of costs. The application was referred to Mr John Gibson (the Assessor). In a submission to the Assessor on 14 August 2012, Ms Hughes requested him to provide a preliminary determination on the question of whether or not the costs charged by the Solicitors exceeded the maximum provided for under the Compensation Act. The Solicitors also made written submissions to the Assessor in which, inter alia, they provided some explanation as to why a costs agreement had not been forwarded before 14 July 2005. In that regard, the Solicitors conceded that they had not provided a written costs disclosure to Ms Hughes as soon as reasonably practicable after their retainer.

  1. On 18 February 2013, the Assessor provided to Ms Hughes and to the Solicitors a document headed "Draft Reasons". In the letter forwarding that document, the Assessor described the document as "Preliminary Reasons". The document said that the Assessor proposed to assess costs as being regulated by the Compensation Act up to 14 July 2005 and that the costs thereafter would be assessed on the basis that the contracting out provisions of the Compensation Act applied.

  1. On 28 February 2013, Ms Hughes's solicitors wrote to the Assessor saying that they were instructed to appeal and therefore asked him to "suspend operation" of his "decision". The Assessor responded saying that he did not propose to make any further determination in the event that an appeal was lodged and that he would close his file pending the determination of the appeal.

  1. On 19 March 2013, Ms Hughes filed a summons in the Common Law Division purporting to commence an appeal from "the part of the decision below in relation to the basis of assessment of costs incurred after 14 July 2005". The Solicitors challenged the competence of the appeal. For reasons published on 25 July 2013, a judge of the Common Law Division concluded that the challenge to the competency of the appeal failed. His Honour also concluded that the ruling made by the Assessor was erroneous. On 30 August 2013, his Honour ordered that the appeal be allowed, that the decision of the Assessor that costs incurred after 14 July 2005 be assessed and allowed on the basis set out in the costs agreement be set aside, and that the matter be remitted to the Assessor for determination in accordance with his Honour's judgment. By summons filed on 28 November 2013, the Solicitors seek leave to appeal from the orders made by the primary judge.

Legislative Framework

  1. In order to explain the questions raised by the proceedings, it is necessary to say something about the relevant provisions of the Compensation Act and the relevant provisions of the Legal Profession Act 1987 (NSW) (the Profession Act) (which was the applicable Act at the relevant time). The provisions of the latter are applied by regulations made under the former, being the Motor Accidents Compensation Regulation (No 2) 1999 (NSW) (the Compensation Regulations).

The maximum costs provisions

  1. Section 149(1) of the Compensation Act relevantly provides that the Compensation Regulations may make provision for or with respect to fixing maximum costs for legal services provided to a claimant in any motor accidents matter. Under s 149(2), an Australian legal practitioner is not entitled to be paid or to recover for a legal service an amount that exceeds any maximum costs fixed for the service by the Compensation Regulations. Section 149(4) relevantly provides that s 149 and any regulations made thereunder are to prevail to the extent of any inconsistency with the Profession Act and in particular s 196 of the Profession Act. An assessment under Div 6 of Pt 11 of the Profession Act of any costs in respect of which provision is made by regulation under s 149 is to be made so as to give effect to the Compensation Regulations.

  1. Part 3 of the Compensation Regulations deals with costs. Division 1 of Pt 3 deals with the maximum costs recoverable by legal practitioners and consists of cll 8 to 11. Under cl 8, Div 1 applies to legal costs payable on a solicitor and client basis. Clause 9(1) relevantly provides that the maximum costs for legal services provided by a legal practitioner to a claimant in any motor accidents matter are the costs set out in Sch 1 to the Compensation Regulations, except as otherwise provided by Pt 3. Under cl 9(2), if there is a change in the legal practitioner retained by a claimant in a motor accidents matter, the relevant costs are to be apportioned between the legal practitioners concerned. Clause 9(3) provides that, if there is a dispute as to such an apportionment, either legal practitioner concerned may refer the dispute to a claims assessor for determination.

  1. Clause 11 deals with contracting out in relation to solicitor and client costs. The effect of cl 11 is that Sch 1 to the Compensation Regulations does not apply to the costs in respect of which cl 11 applies, to the extent that the costs are payable on the solicitor-client basis. Clause 11(1) specifies the circumstances in which cl 11 applies. There are three prerequisites for the application of cl 11.

  1. The first is that a legal practitioner must make a disclosure under Div 2 of Pt 11 of the Profession Act to a party to the matter with respect to the costs. However, ss 180 and 181 of the Profession Act are excepted (but those sections are not directly relevant to the present case). Division 2 of Pt 11 of the Profession Act deals with disclosure of matters relating to costs, and consists of ss 175 to 183.

  1. The second prerequisite under cl 11 is that the legal practitioner must enter into a costs agreement with the party to the motor accidents matter as to those costs. The costs agreement is to be entered into in accordance with Div 3 of Pt 11 of the Profession Act. Division 3 of the Profession Act deals with costs agreements, and consists of ss 184 to 189.

  1. The third prerequisite of cl 11 is that, before entering into a costs agreement, the legal practitioner must advise the party to the motor accidents matter, in a separate written document, that, even if costs are awarded in favour of the party, the party will be liable to pay such amount of the costs provided for in the costs agreement as exceeds the amount that would be payable under the Compensation Act in the absence of a costs agreement.

  1. The substantive question on which the Assessor made a ruling is whether the Solicitors satisfied the first prerequisite of cl 11, that is, of making a disclosure under Div 2 of Pt 11 of the Profession Act. It is common ground that the Solicitors entered into a costs agreement with Ms Hughes in accordance with Div 3 of Pt 11 of the Profession Act, albeit some time after they were originally retained, and it is common ground that the third prerequisite was satisfied.

The costs assessment provisions

  1. Division 6 of Pt 11 of the Profession Act deals with the assessment of costs. Subdivision 4B, which consists of ss 208L to 208NC inclusive, deals with appeals. The provisions of Subdiv 4B are critical to the question as to the competence of Ms Hughes's appeal to the Supreme Court.

  1. Section 199 of the Profession Act provides that a client who is given a bill of costs may apply for an assessment for the whole or part of those costs. Section 203 provides that an application for assessment is to be made in accordance with the regulations. Section 206 provides that each application for assessment is to be referred to a costs assessor to be dealt with under Div 6.

  1. Section 208A provides that, when considering an application relating to a bill of costs, the costs assessor must consider whether or not it was reasonable to carry out the work to which the costs relate, whether or not the work was carried out in a reasonable manner, and the fairness and reasonableness of the amount of the costs in relation to that work. The costs assessor is then to determine the application by confirming the bill of costs or, if the costs assessor is satisfied that the disputed costs are unfair or unreasonable, by substituting for the amount of the costs an amount that is, in the opinion of the costs assessor, a fair and reasonable amount. Under s 208B, when assessing what is a fair and reasonable amount of costs, a costs assessor may have regard to any or all of a number of matters, including whether the solicitor complied with any relevant regulations and whether the solicitor disclosed the basis of the costs or an estimate of the costs under Div 2, and any such disclosure made.

  1. Under s 208C, a costs assessor is to decline to assess a bill of costs if the disputed costs are subject to a costs agreement that complies with Div 3 and the costs agreement specifies the amount of costs, or the dispute relates only to the rates specified in the costs agreement calculating the costs. However, s 208C does not apply to any provision of a costs agreement that the costs assessor determines to be unjust under s 208D. Under s 208D, a costs assessor may determine whether a term of a particular costs agreement entered into by a solicitor and a client is unjust in the circumstances relating to it at the time it was made.

  1. Sections 208L and 208M, in Subdiv 4B, are critical to the question of whether Ms Hughes's appeal to the Supreme Court was competent. Under s 208L(1), a party to an application who is dissatisfied with a decision of a costs assessor as to a matter of law arising in the proceedings to determine the application may appeal to the Supreme Court against the decision. Under s 208L(2), after deciding a question that is the subject of the appeal, the Supreme Court may, unless it affirms the costs assessor's decision:

  • make such determination as, in its opinion, should have been made by the costs assessor; or
  • remit its decision on the question of costs to the costs assessor and order the costs assessor to redetermine the application.

On a redetermination, fresh evidence, or evidence in addition to or in substitution of the evidence received in the original proceedings, may be given.

  1. Under s 208M(1), a party to an application relating to a bill of costs may seek leave of the Supreme Court to appeal to the Court against the determination of the application made by a costs assessor. The Supreme Court may grant leave to appeal and may hear and determine the appeal. Such an appeal is to be by way of a new hearing and fresh evidence, or evidence in addition to or in substitution for the evidence received in the original proceedings, may be given. Under s 208M(5), after deciding the questions that are the subject of the appeal, the Supreme Court may, unless it affirms the costs assessor's decision, make such determination in relation to the application as, in its opinion, should have been made by the costs assessor.

  1. Thus, a clear distinction is drawn between an appeal as of right from a decision as to a matter of law arising in proceedings to determine an application, on the one hand, and an appeal only with leave from a determination of an application made by a costs assessor, on the other.

Consideration

  1. I have had the advantage of reading in draft form the proposed reasons of Tobias AJA. I agree with his Honour, for the reasons proposed, that the primary judge had no jurisdiction to deal with the question that arose concerning the application of the Compensation Regulations. It follows that this Court also has no jurisdiction to deal with that question. I agree with Tobias AJA that neither the parties, nor the Assessor, should assume that the conclusions of the primary judge on that question are correct. I agree with the orders proposed by Tobias AJA.

  1. TOBIAS AJA: The respondent was injured in a motor vehicle accident on 31 March 2001. In July 2003 she instructed the first applicant, a solicitor, to act for her in a claim against the relevant insurer who had admitted liability on 20 June 2001. At that time, the first and second applicants were in a partnership, trading as Colin Daley Quinn. The respondent's claim was ultimately settled on or about 19 December 2011 for the sum of $750,000 inclusive of costs. From that amount the applicants deducted the sum of $240,579 to cover solicitor's costs, disbursements and counsel's fees.

The relevant history

  1. Having paid to the applicants an amount of $240,579, the respondent then retained a new firm of solicitors who wrote to the applicants requesting an itemised bill of costs. That bill totalled $242,655.89 and included costs, disbursements, counsel's fees and GST. Pursuant to s 199 of the Legal Profession Act 1987 (NSW) (the Act) the respondent applied to the proper officer of the Supreme Court for an assessment of the whole of the costs contained in the bill. Pursuant to s 206 that officer referred the application for assessment to a costs assessor to be dealt with under Div 6 Pt 11 of the Act.

  1. Before the costs assessor, the respondent submitted that the costs to which the applicants were entitled were limited by cl 9(1) of the Motor Accidents Compensation Regulation (No 2) 1999 (NSW) (the Regulation) to the costs set out in Sch 1 thereto and which amounted to $29,261 (though before the primary judge (Davies J), the respondent was content to adopt the figure calculated by the applicants, $33,313.19). In response, the applicants contended that they had contracted out of Sch 1 pursuant to cl 11 of the Regulation which provided as follows:

"Contracting out - solicitor/client costs
(1) This clause applies in respect of costs in a motor accidents matter if a legal practitioner:
(a) makes a disclosure under Division 2 of Part 11 of the Legal Profession Act 1987 (sections 180 and 181 excepted) to a party to the matter with respect to the costs, and
(b) enters into a costs agreement (other than a conditional costs agreement, within the meaning of that Part, that provides for the payment of a premium on the successful outcome of the matter concerned) with that party as to those costs in accordance with Division 3 of that Part, and
(c) before entering into the costs agreement, advises the party (in a separate written document) that, even if costs are awarded in favour of the party, the party will be liable to pay such amount of the costs provided for in the costs agreement as exceeds the amount that would be payable under the Act in the absence of a costs agreement.
(2) Schedule 1 does not apply to the costs concerned to the extent that they are payable on a solicitor and client basis."

  1. The respondent accepted that the applicants had complied with sub-paragraphs (b) and (c) of cl 11(1) but asserted that they had failed to comply with sub-paragraph (a). Accordingly, they had failed to contract out of the maximum costs for the legal services allowed by cl 9(1)(a) and Sch 1 to the Regulation.

  1. On 18 February 2013 the costs assessor issued to the parties a document headed "DRAFT REASONS" (the draft reasons). Relevantly, at paragraphs 48-49 of the draft reasons he accepted the submission on behalf of the respondent that the applicants had not contracted out of the costs limitation in Sch 1 to the Regulation, but only in respect of the period prior to 14 July 2005; and that of the applicants that the costs incurred by her after that date should be allowed on the basis set out in a costs agreement of the same date into which the respondent had entered (the costs agreement). Accordingly, at paragraph 54 the costs assessor stated:

"From the above the parties will note I propose to assess costs as being regulated by the Motor Accident's [sic] Act up to 14 July 2005. The costs are then to be assessed thereafter on the basis that the contracting out provisions apply."

  1. After receipt of the draft reasons the solicitors for the respondent wrote to the costs assessor on 28 February 2013 indicating that they had been instructed to appeal to the Supreme Court against the "decision" of the costs assessor in the draft reasons and requesting that he not proceed further with his assessment of the respondent's application until that appeal had been resolved. The costs assessor agreed to that course.

  1. In accordance with r 50.3 of the Uniform Civil Procedure Rules 2005 (NSW) (the UCPR) which provides that a summons commencing an appeal must be filed within 28 days, on 19 March 2013 the respondent filed a summons in which she purported to appeal against that part of the "decision below" in relation to the basis of the assessment of costs incurred after 14 July 2005. The appeal purported to be pursuant to s 208L of the Act which provided:

"Appeal against decision of costs assessor as to matter of law
(1) A party to an application who is dissatisfied with a decision of a costs assessor as to a matter of law arising in the proceedings to determine the application may, in accordance with the rules of the Supreme Court, appeal to the Court against the decision.
(2) After deciding the question the subject of the appeal, the Supreme Court may, unless it affirms the costs assessor's decision:
(a) make such determination in relation to the application as, in its opinion, should have been made by the costs assessor, or
(b) remit its decision on the question to the costs assessor and order the costs assessor to re-determine the application.
(3) On a re-determination of an application, fresh evidence, or evidence in addition to or in substitution for the evidence received at the original proceedings, may be given."

  1. It is convenient at this point of the narrative to also set out s 208M of the Act as the relationship between it and s 208L is relevant to the competency of the respondent's appeal to the primary judge upon which, as will appear, the resolution of the appeal to this Court ultimately turns:

"Appeal against decision of costs assessor by leave
(1) A party to an application relating to a bill of costs may, in accordance with the rules of the Supreme Court, seek leave of the Court to appeal to the Court against the determination of the application made by a costs assessor.
(2) A party to an application relating to costs payable as a result of an order made by a court or a tribunal may, in accordance with the rules of the court or tribunal, seek leave of the court or tribunal to appeal to the court or tribunal against the determination of the application made by a costs assessor.
(3) The Supreme Court or court or tribunal may, in accordance with its rules, grant leave to appeal and may hear and determine the appeal.
(4) An appeal is to be by way of a new hearing and fresh evidence, or evidence in addition to or in substitution for the evidence received at the original proceedings, may be given.
(5) After deciding the questions the subject of the appeal, the Supreme Court or court or tribunal may, unless it affirms the costs assessor's decision, make such determination in relation to the application as, in its opinion, should have been made by the costs assessor."

  1. The "appeal" came before the primary judge for hearing on 12 and 17 June 2013. Before his Honour, the applicants challenged the competency of the appeal, submitting that there was no relevant "decision" of the costs assessor to which the provisions of s 208L(1) could apply. His Honour rejected the applicants' challenge: Hughes v Geraldine Daley trading as Colin Daley Quinn, Solicitors And Barristers [2013] NSWSC 806 at [57].

  1. The primary judge then embarked upon the issue as to whether there had been compliance with cl 11(1)(a) of the Regulation. At [66] he observed that were it not for one matter, he would have come to the same conclusion as the costs assessor, namely, that the result of making the costs agreement some years after the retainer of the applicants commenced resulted in capped costs applying up until the making of that agreement but thereafter costs were payable in accordance with the agreement.

  1. However, although the applicants had retained counsel who had provided to them a disclosure as to the basis of the costs of legal services to be provided by him to the client as required by s 176 of the Act, as well as an estimate of the likely amount of such costs as required by s 177(2) of the Act ($20,000), the applicants had only disclosed to the client pursuant to s 175 the basis of the costs of legal services to be provided by counsel but had failed to also disclose counsel's estimate of the likely amount of those costs until approximately one month before the matter settled. Accordingly, the primary judge held (at [68]) that the failure by the applicants to comply with s 177 with respect to counsel's estimate of his fees resulted in a failure to comply with the requirements of cl 11(1)(a) of the Regulation.

  1. His Honour also rejected an alternative submission by the applicants that as there had been disclosure by them pursuant to s 177(1) of the likely amount of the costs of legal services to be provided by them to the client, there had been compliance with cl 11(1)(a) so far as the applicants' costs were concerned, even if there had been non-compliance with respect to those of counsel, so that the former were not limited by Sch 1 to the Regulation albeit that the latter were. However, his Honour considered (at [72]-[73]) that the disclosure of the estimates of the applicants and counsel could not be regarded separately for the purposes of cl 11. He therefore held (at [74]) that cl 11(1)(a) of the Regulation had not been complied with as there had not been disclosure of counsel's estimate pursuant to s 177(2) and as a consequence thereof, the costs recoverable by the applicants were limited to those allowed by Sch 1 to the Regulation.

  1. Accordingly, on 30 August 2013 his Honour made formal orders allowing the appeal and setting aside the decision of the costs assessor that costs incurred after 14 July 2005 be assessed and allowed on the basis set out in the costs agreement: Hughes v Geraldine Daley trading as Colin Daley Quinn, Solicitors And Barristers (No 2) [2013] NSWSC 1213. His Honour further ordered that the matter be remitted to the costs assessor for determination in accordance with his judgment.

  1. I should add for completeness that the applicants had filed a cross-summons seeking a declaration that the costs assessor was required to proceed on the basis that costs up to 14 July 2005 be assessed on a fair and reasonable basis and thereafter pursuant to the costs agreement. At [85] of his reasons his Honour noted that even if he had found that the applicants had satisfied the requirements of cl 11 by 14 July 2005, the effect of that would not be retrospective. Accordingly he dismissed the cross-summons with costs.

  1. On 28 November 2013 the applicants filed a summons in this Court seeking leave to appeal from the orders made by the primary judge with respect to the respondent's appeal. There is no cross-appeal against his Honour's dismissal of the applicants' cross-summons. The summons for leave and the appeal were heard concurrently (and therefore I refer to the applicants as the appellants hereafter).

  1. The Court heard full argument with respect to the two issues which arose for consideration: first, whether his Honour had erred in finding that the appellants had failed to comply with the requirements of cl 11(1)(a) of the Regulation and, secondly, whether he had erred in rejecting the challenge to the competency of the respondent's appeal. The first issue turned on the proper construction of the provisions in Div 2 of Pt 11 of the Act and in particular ss 175 to 178. The latter turned on the proper construction of s 208L of the Act.

  1. It was common ground that in the event that the competency issue was determined against the respondent so that she had no right of appeal from the so-called "decision" of the costs assessor, then it would follow that the primary judge had acted without jurisdiction with the consequence that it would be inappropriate, as the costs application would now have to be finalised by the costs assessor, for this Court to determine the issue raised by cl 11(1)(a) of the Regulation for it would also lack jurisdiction to do so. I therefore turn to the issue of competency.

The primary judge's reasons on the issue of the competency of the respondent's appeal

  1. Before the primary judge, the appellants submitted first, that there had been no final decision of the costs assessor in his "draft reasons"; nor was the issue of those reasons a procedure recognised by the Act. Secondly, there was no statutory basis for doing what the costs assessor did; although there were various sections in Div 6 of Pt 11 of the Act which empowered a costs assessor to make various rulings, there was no statutory power for the costs assessor to make what, in effect, was said to be a preliminary decision on a matter of law. Rather, it was submitted that the "decision" in respect of which the right of appeal arises under s 208L must be one that finally determines an issue or claim between the parties and is binding upon them. Further, it was submitted that there can be no right of appeal against any interlocutory ruling of a costs assessor simply because it involves a question of law. It would cause inconvenience to interpret s 208L in this way, because of the need to appeal within 28 days of the material date even where the costs assessment was not completed.

  1. At [42] of his reasons the primary judge referred to two authorities in which the meaning of the word "decision" had been discussed, namely, Director-General of Social Services v Chaney [1980] FCA 87; (1980) 47 FLR 80 at 100 (Chaney) and Australian Broadcasting Tribunal v Bond [1990] HCA 33; (1990) 170 CLR 321 at 337 (Bond). The passages referred to, his Honour accepted, suggested that ordinarily a "decision" is the final determination of the matter from which the appeal or review comes to the court concerned.

  1. At [43] his Honour noted that a similar issue arose before Einstein J in Currabubula & Paola v State Bank of New South Wales [2000] NSWSC 232 (Currabubula). As the primary judge there recorded, in that case a costs assessor accepted the submission by the defendant (being the party required to pay the costs) that there was an established principle of taxation that where an order for costs is made in favour of only one of two jointly represented parties, the successful party can recover only half its costs for common work. The plaintiff sought to set aside that decision of the costs assessor by way of an appeal under s 208L. It was submitted to Einstein J that no appeal was available because no determination of the application for a costs assessment had been made. The primary judge further recorded that Einstein J had discussed the meaning of the word "decision" in a number of cases including Chaney and Bond. Einstein J had then referred to the distinction made in the Act between a "determination" and a "decision". His Honour then recorded (at [44]) what Einstein J had said at [80] and [81] of Currabubula to which I shall return.

  1. In essence, Einstein J contrasted s 208L with s 208M and concluded that the Act clearly contemplated that a decision was something different from and anterior to a determination of the assessment. He further concluded that the use of the present tense in s 208L(1), rather than the past tense, demonstrated that the statute intended to create an appeal right while proceedings to determine the application were extant.

  1. The primary judge then noted (at [46]) that the arguments put to him were also put to Einstein J and rejected, apart from one, namely, an argument based on convenience that the primary judge rejected. At [47] his Honour considered that it was in neither party's interests for the costs assessor to finalise his assessment until the Supreme Court had determined the correct basis for it. There was considerable advantage, he said, in having a procedure for appeal to determine the correctness of a preliminary decision on a point of law such as in the present case. His Honour thus considered that Einstein J's decision was correct and that he proposed to follow it. In particular, although he appeared to accept (at [52]) there was no procedure contained in the Act which, unlike Pt 28 UCPR, provided a procedure for the separate determination of a question of law, nevertheless the distinction made between "determination" and "decision" in the relevant provisions of Pt 11 the Act appeared to facilitate such a process. His Honour therefore held that the appeal was competent.

The parties' submissions on the issue of competency

  1. The respondent essentially relied upon the reasoning of the primary judge in submitting that her appeal was competent. She further submitted that there had been, in effect, a "decision" of the costs assessor on a matter of law which arose in the proceedings and that he had made a sufficiently definite expression of intention as to constitute a "decision" within the meaning of s 208L(1).

  1. Although the respondent accepted that the word "decision" was a word of "indeterminate meaning" as stated in Chaney at 100, nevertheless it was contended that the statute distinguished in clear terms between an appeal against a "decision" (s 208L) and an appeal against a "determination" (s 208M). In order to determine the application for assessment it was necessary for the costs assessor to make a decision as to the contracting out issue. Section 208L did not require a decision that is identified and provided for as a separate procedure under the Act but only a decision "as to a matter of law arising in the proceedings to determine the application". In its context, therefore, the concept of a "decision" was quite different from that of a "determination". Only the latter needed to be final. Further, as a matter of legal policy, it was appropriate that there should be a right of appeal as to a matter of law arising in proceedings even where the latter had not been completed by the making of a determination.

  1. The appellants drew the Court's attention to a number of provisions of which the following are of significance. Section 208J(1) provides that on the making of a determination a costs assessor is to issue to each party a certificate that sets out his or her determination. Section 208J(1A) empowers a costs assessor to issue more than one certificate in relation to an application for costs assessment which certificate may be issued at different stages of the assessment process. Section 208JAA obliges a costs assessor to ensure that a certificate issued under s 208J that sets out his or her determination is accompanied by a statement of reasons for the determination. Furthermore, s 208K provides that a costs assessor's determination of an application is binding on all parties to it and that no appeal or other review lies in respect of the determination except as provided by, relevantly, ss 208L and 208M. I have set out at [44] and [45] above the text of ss 208L and 208M. It is noteworthy that the headings to both ss 208L and 208M (which were accepted to form part of the Act) refer to an appeal "against decision of costs assessor".

  1. One decision referred to by the appellants to this Court but not mentioned by the primary judge is that of the Supreme Court of South Australia sitting in Banco in Mobitel (International) Pty Ltd v Dun & Bradstreet (Australia) Pty Ltd (1979) 22 SASR 288. The case involved a ruling by the Chairman of the Credit Tribunal set up under the Consumer Credit Act 1972 (SA) on a question of law. The ruling given by the Chairman was described by him in his reasons as the "Chairman's ruling on preliminary questions of law". Section 25(1) of the Consumer Credit Act provided that any person aggrieved by a decision or order of the Tribunal shall be entitled to appeal to the Supreme Court against that decision or order. The issue that arose was whether the Chairman's ruling on a preliminary question of law was a decision of the Tribunal in respect of which a right of appeal existed.

  1. Walters J, with whom King CJ and Zelling J agreed, observed (at 291) that in the case of a decision of a statutory tribunal, a right of appeal from any decision made by it must be plainly given by the legislation by which the tribunal is created and that no right of appeal can be presumed. Further, that right must be shown to exist by clear and unequivocal language.

  1. His Honour concluded (at 292) that a ruling of the Chairman of the Tribunal on a question of law did not "fill the character" of a decision or order of the Tribunal. Rather, his determination on a question of law was merely a part of the judicial process which is invoked in order to decide the issues arising on an appeal before the Tribunal in contradistinction to a decision of the Tribunal that determines the substantive rights of the parties litigating the appeal. Until the Tribunal has made a decision, the determination of the Chairman on a question of law had, in a sense, an inchoate effect only. It rested with the Tribunal ultimately to say what will be its decision after conforming to the Chairman's ruling.

  1. I do not consider that the decision in Mobitel is of great assistance. Although the relevant legislation provided that any question of law was to be determined by the Chairman of the Tribunal, s 25(1) of the Consumer Credit Act provided for an appeal only by a person aggrieved by a "decision or order of the Tribunal". Walters J properly drew a distinction between a decision or order of the Tribunal on the one hand and a ruling of the Chairman of the Tribunal on a question of law on the other. There being no statutory right of appeal from the ruling of the Chairman on a question of law as distinct from an appeal from a decision or order of the Tribunal itself, it followed that the appeal in that case was incompetent. The distinction upon which Walters J relied is not present in the instant case.

  1. In Chaney, Deane J, with whom Fisher J agreed, was dealing with the provisions of s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act) pursuant to which a party to a proceeding before the Tribunal may appeal to the Federal Court on a question of law "from any decision of the Tribunal" in that proceeding. The President of the Tribunal had ruled that it had jurisdiction to review the decision of the Director-General in question and made an interim order pending the outcome of the appeal, which the Tribunal had not yet heard and determined. The question that arose was whether an appeal lay from the ruling and interim order of the President, it being contended that an appeal to the Federal Court under the relevant provision of the AAT Act lay only from a decision of the Tribunal which constitutes the effective decision or determination of the application for review. In this respect Chaney had similarities to Mobitel. However, some of the reasoning of Deane J in Chaney is instructive.

  1. Deane J noted (at 99) that it was apparent the Tribunal had not, at the relevant stage, purported to make any determination disposing of the application for review which had been made to it. All that had happened was that it had made a ruling on a preliminary question of jurisdiction, and it had made an interim order pending the determination of the application for review.

  1. As to the meaning of the word "decision", his Honour said (at 100):

"The word 'decision' is a word of indeterminate meaning. In some contexts, it can refer to the mental process of making up one's mind. In the context of judicial or administrative proceedings, the word will ordinarily refer to an announced or published ruling or adjudication. In such a context, the word 'decision' may be apt to include the determination of any question of substance or procedure, including, for example, rulings on procedural questions such as whether particular evidence should be received, or the meaning of the word may be limited to a determination effectively resolving an actual substantive issue. When the word 'decision' has the last-mentioned limited meaning, it can refer to any such determination whether final or intermediate ... Further, though it is not necessarily a word of art, there is high authority for saying that even without such a context the 'natural, obvious and prima-facie meaning of the word "decision" is decision of the suit by the Court'." (Citations omitted.)

  1. Although at 101 Deane J recognised that the statutory language could accommodate a preliminary decision due to the fact that s 44(1) provided for an appeal from "any decision of the Tribunal", nevertheless his Honour rejected that argument, observing (at 102) that if an appeal could be brought at any intermediate stage of the proceedings, that would involve disruption of the proceedings before the Tribunal as the latter would be obliged by s 46 of the AAT Act to send to the Federal Court all documents that were before the Tribunal in connection with the proceedings to which the appeal related. His Honour continued:

"It would seem unlikely that it was the legislative intent that any party to a proceeding should be entitled to disrupt its orderly hearing before the Tribunal by instituting an appeal, as of right, from any of the various 'decisions', involving a question of law, which the Tribunal might find itself called upon to make in the course of dealing with the proceeding before it and which might ultimately prove irrelevant to the final operative decision. In the context of the clear right to appeal, on a question of law, from the ultimate decision of the Tribunal and of the intermediate procedure of stating a question of law for the decision of this Court, it would seem more likely that it was the legislative intent to limit judicial intervention during the actual hearing before the Tribunal to the supervisory, and, to some extent, discretionary, jurisdiction provided by the prerogative writs."

  1. The convenience argument encapsulated in the above passage was further reiterated by his Honour at 103 where he said:

"The issue is whether such an appeal lies, instanter, from a ruling or adjudication upon the road to ultimate decision, regardless of whether that ruling or adjudication may prove irrelevant to the ultimate decision or whether further evidence, increased understanding or, indeed, plain reconsideration may lead to its reversal by the Tribunal itself before the ultimate decision is delivered. It may be suggested that the proliferation of opportunities to appeal should be seen as a safeguard of the rights of the individual subject. Such a suggestion would, in my view, be misconceived."

Accordingly, Deane J held that an appeal under s 44(1) lay only from a decision of the Tribunal which constituted the effective decision or determination of the application for review.

  1. Both the appellants and the primary judge also referred to some observations of Mason CJ in Bond at 335-339 where his Honour dealt with the meaning of "decision". After noting that the word had a variety of potential meanings and referring to what Deane J had said in Chaney at 100, the Chief Justice held (at 339) that the relevant conclusion of the Tribunal in that case was not a determination for which the legislation provided. It was no more than a step in the Tribunal's reasoning on the way to its final determination of the issue before it. Although it was an essential step in the reasoning by which the Tribunal chose to support its final determination, that circumstance was not enough to invest the conclusion with the characteristics which would qualify it as a reviewable decision.

  1. A similar question as to the meaning of "decision" arose in Clisdell v Commissioner of Police (1992) 31 NSWLR 555. That case concerned the availability of an appeal pursuant to s 54 of the Government and Related Employees Appeal Tribunal Act 1980 (NSW), which conferred a right of appeal "against any decision of the Tribunal on a question of law". Sheller JA (with whom Handley and Cripps JJA agreed) expressed the view (at 558) that an appeal from a decision of a court is an appeal from a "judicial act which affects adversely the rights claimed by the appellant", and not an appeal from "a pronouncement by the court of an opinion upon a question of law" (citing Commonwealth v Bank of New South Wales (1949) 79 CLR 497 at 624 (Lord Porter)). Sheller JA adopted (at 558, 560) the view expressed by Mason CJ in Bond at 338 that the word "decision" means an ultimate or operative determination, and not a mere expression of opinion or statement which can have no effect on a person (Mason CJ also indicated there that he did not consider this to mean antecedent conclusions that contribute to the ultimate or operative decision are beyond the reach of review).

  1. The appellants submitted that the decision of Einstein J in Currabubula, insofar as his Honour determined that a right of appeal from a purported decision of a costs assessor on a question of law which arose during the course of the proceedings gave rise to a right of appeal, was wrong and that that part of the decision should be overruled. It is therefore necessary to refer to some of the passages in Einstein J's reasons. At [76], his Honour referred to what Deane J had said in Chaney and Mason CJ had said in Bond, noting that one matter which exercised the mind of the Chief Justice in Bond was the undesirability of the fragmentation of administrative decision making which would be attended by a broader interpretation of the meaning of "decision". At [77] his Honour noted that it was nevertheless made clear by the Chief Justice that the meaning of the word "decision" must be determined by the context in which the word is found.

  1. At [80] Einstein J noted that the distinction between a "determination" and a "decision" was clear from the terms of s 208L(1) and that that distinction was reinforced by s 208M, which provided a separate right of appeal against the determination of the application. His Honour continued:

"If s 208L(1) only permits an appeal on a question of law after a final determination of the costs assessor, then the section is otiose, for an appeal under s 208M is an appeal de novo: see s 208M(4). The distinction the Act draws between the appeal procedures is not sufficiently explained ... upon the ground that one (s 208L(1)) contains a right of appeal while the other (s 208M) contains only an avenue of appeal upon leave. In my view, the different appeal procedures direct themselves to different situations. To my mind, the Act clearly contemplates that a decision is something different from and anterior to a determination of the assessment. The use of the present tense in s 208L(1) - 'arising in the proceedings to determine' - rather than the past tense - 'arose in the proceedings to determine' - demonstrates that the statute intended to create an appeal right while proceedings to determine the application were extant."

  1. In essence, the appellants' submissions as to the competency of the respondent's appeal may be summarised as follows:

(a) There is no statutory power in the Act to make a preliminary ruling as the costs assessor had purported to do in the present case;

(b) Nor did the Act include a power to isolate separate questions of law such as that conferred in UCPR Pt 28;

(c)   As the ruling of the costs assessor had no statutory status it was not binding either on the parties or on himself;

(d)   The primary judge looked at the matter from the wrong perspective as an appeal is a creature of statute so that before a ruling, decision or other conclusion can be appealed, the statutory power to appeal must be identified;

(e)   Although the meaning of the word "decision" must depend on its context, it has usually been held to refer to a final determination of a particular form of procedure or, at least, a particular specifically authorised step in that procedure, as distinct from a ruling or reasoning given along the way;

(f)   One of the factors which has influenced this approach is the undesirability that procedures, either quasi-curial or administrative, should be bifurcated as a result of "interlocutory" appeals or challenges: this is so notwithstanding that it may be convenient in some cases for legal issues to be determined in a preliminary manner;

(g) Even if there is no right of appeal against the costs assessor's decision under s 208L, that does not mean that the Court does not have power to provide declaratory relief or, as Deane J pointed out in Chaney, relief by way of prerogative writ. However, such relief is discretionary thus leaving the Court with the flexibility to provide a remedy but only in appropriate cases. On the other hand, if s 208L provides a right of appeal as held by the primary judge, the Court would be required to entertain every single complaint made by a party to a costs assessment which raised or arguably raised a matter of law;

(h)   Although in Currabubula Einstein J referred to the distinction between a "decision" and "determination", a distinction more easily seen in s 208M, such textual considerations are not of overwhelming significance. Plainly s 208L must confer a right of appeal with respect to a decision as to a matter of law which is embodied in a final determination. The phrase "decision of a costs assessor as to a matter of law arising in the proceedings to determine the application" is better understood as conferring a right of appeal against any decision on a matter of law involved in determining the application;

(i) While the words "decision" and "determination" are used in s 208M, suggesting some difference between them, a comparison of s 208L(2) with s 208M(1) and (5) suggests that in ss 208L and 208M the words are used interchangeably;

(j) Furthermore, s 208K (to which I have referred at [62] above) refers only to a "determination": it would be paradoxical if a costs assessor's determination was protected from curial review but an "interlocutory" decision was not.

The appellants' submissions should be accepted

  1. The difficulty of accepting the primary judge's conclusion is that the so-called "decision" in respect of which it was held an appeal as of right arose under s 208L constituted no more than an expression of intention on the part of the costs assessor as to the future conduct of his assessment. His so-called "decision" at paragraph 54 of his "draft reasons" was no more than an expression of future intention. It was neither binding on the parties nor on the costs assessor. There is nothing in the Act that would prevent the appellants from making further submissions to the costs assessor with a view to seeking a different "decision" to that contained in that paragraph. The position would be different once a final determination had been made.

  1. In my view, there is therefore much to be said for the convenience argument which the primary judge rejected but which was given significant weight by Deane J in Chaney particularly at 102. Nor, with respect, do I accept the reliance placed by Einstein J in Currabubula on the textual differences between ss 208L and 208M. In particular, I disagree with his Honour's finding at [80] that if s 208L(1) only permits an appeal on a matter of law after a final determination of a costs assessor, then the section is otiose as an appeal under s 208M is an appeal de novo so that the matter of law can be litigated in that appeal.

  1. Where a final determination is made which involves a decision on a matter of law, the aggrieved party has by virtue of s 208L a right of appeal with respect to that matter; whereas an appeal by virtue of s 208M can only proceed with the leave of the Court with respect to so much of the determination that does not involve a matter of law.

  1. As I understand the point that Einstein J seeks to make, it is that a decision on a matter of law could be the subject of a de novo hearing in respect of an appeal pursuant to s 208M. But that would require the grant of leave before it could be pursued, whereas no such leave is required under s 208L. In my view it cannot be said that s 208L is otiose because, if leave is granted, a matter of law can be reagitated in a de novo hearing pursuant to s 208M. Why, one asks rhetorically, would one accept the burden of obtaining leave to agitate a decision on a question of law pursuant to s 208M when there is an appeal as a right with respect to that matter under s 208L? In my respectful view, Einstein J's reasoning on this point is in error. Accordingly, that part of his decision with respect to his construction of s 208L should be overruled.

  1. I also cannot agree with the emphasis placed by Einstein J on the use of the present tense in s 208L(1). In particular, its use does not, in my view, demonstrate that the statute intended to create an appeal right where there was a ruling on a question of law of a preliminary or interlocutory nature. There is nothing inconsistent with the use of the present tense and a construction of s 208L(1) to the effect that the right of appeal which it provides arises only when the proceedings have been determined by the issue of a certificate under s 208J(1) or (1A).

  1. Finally, the relationship between s 208L and s 208M leads me to conclude, consistently with the appellants' submissions, that in the context of the juxtaposition of the two appeal provisions, the legislature intended that they should be read as only contemplating an appeal, whether as of right pursuant to s 208L or with leave pursuant to s 208M, at the end of the assessment process or at least only upon a formal determination by the costs assessor.

  1. Such a construction finds support in the general remarks of Deane J in Chaney recorded at [69]-[70] above, Mason CJ in Bond referred to at [72] above and Sheller JA in Clisdell at [73] above, as well as in the absence of clear words in s 208L granting an appeal with respect to what can only be classed as an interlocutory decision on a matter of law.

  1. For the foregoing reasons in my view, the primary judge was, with respect, in error in rejecting the challenge of the appellants to the competency of the respondent's appeal. In my opinion, the respondent had no right of appeal against the statement of the costs assessor's intent encapsulated in paragraph 54 of his draft reasons with the consequence that Davies J had no jurisdiction to entertain the respondent's purported appeal. It follows that leave to appeal should be granted and the orders of Davies J set aside.

  1. As the primary judge had no jurisdiction to deal with the issue which arose as to the application of the Regulation, neither does this Court notwithstanding that we have had the benefit of full written and oral argument thereon. However, having heard that argument I shall say no more about it other than to indicate that neither the parties nor the costs assessor should assume that I necessarily agree with the primary judge's findings on the issue of whether cl 11(1)(a) of the Regulation was satisfied in the present case.

Conclusion

  1. In light of the foregoing, I would propose the following orders:

  1. Grant the applicants leave to appeal.

  1. Appeal allowed.

  1. Set aside the orders made by Davies J on 30 August 2013 other than so much of Order 1 as dismissed the appellants' cross-summons with costs.

  1. Dismiss the summons filed by the respondent in the Common Law Division of the Court on 19 March 2013.

  1. The respondent to pay the appellants' costs of the summons filed on 19 March 2013 and of the summons for leave to appeal and the appeal but to have with respect to the latter a certificate under the Suitors' Fund Act 1951 (NSW) if otherwise qualified.

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Amendments

18 March 2015 - [9] The reference to 'Commercial Tribunal Act 1994' should read 'Commercial Tribunal Act 1984'.


[19] '14 February' should read '18 February'.

Decision last updated: 18 March 2015

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