Heugh v Central Petroleum Ltd [No 5]
[2014] WASC 311 (S)
•22 OCTOBER 2014
HEUGH -v- CENTRAL PETROLEUM LTD [No 5] [2014] WASC 311 (S)
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2014] WASC 311 (S) | |
| Case No: | CIV:1493/2012 | 9 SEPTEMBER 2014 | |
| Coram: | LE MIERE J | 22/10/14 | |
| 6 | Judgment Part: | 1 of 1 | |
| Result: | Application allowed | ||
| B | |||
| PDF Version |
| Parties: | JOHN PHILLIP HEUGH CENTRAL PETROLEUM LTD |
Catchwords: | Practice and procedure Costs Order removing costs limits fixed in any relevant costs determination Turns on own facts |
Legislation: | Legal Profession Act 2008 (WA), s 280(2) |
Case References: | CMA Contracting Pty Ltd v John Holland Pty Ltd [2011] WASC 249 Frigger v Lean [2012] WASCA 66 Heartlink Ltd v Jones As Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254 (S) Heugh v Central Petroleum Ltd [No 5] [2014] WASC 311 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
CENTRAL PETROLEUM LTD
Defendant
Catchwords:
Practice and procedure - Costs - Order removing costs limits fixed in any relevant costs determination - Turns on own facts
Legislation:
Legal Profession Act 2008 (WA), s 280(2)
Result:
Application allowed
Category: B
Representation:
Counsel:
Plaintiff : Mr M L Bennett & Mr K Malhotra
Defendant : Mr J N West QC & Mr R P V Carey
Solicitors:
Plaintiff : Bennett + Co
Defendant : Jarman McKenna
Case(s) referred to in judgment(s):
CMA Contracting Pty Ltd v John Holland Pty Ltd [2011] WASC 249
Frigger v Lean [2012] WASCA 66
Heartlink Ltd v Jones As Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254 (S)
Heugh v Central Petroleum Ltd [No 5] [2014] WASC 311
1 LE MIERE J: On 5 September 2014 I delivered reasons for judgment in this matter: Heugh v Central Petroleum Ltd [No 5] [2014] WASC 311 and ordered that judgment be entered for the plaintiff against the defendant in the sum of $1,598,298. I ordered that the defendant pay the plaintiff's costs of the action including any reserve costs with such costs to be taxed with an allowance for the expert costs of Mr Christopher Ryan. The plaintiff sought an order pursuant to s 280(2) of the Legal Profession Act 2008 (WA) that its costs be taxed on the basis that the limits on costs fixed in any relevant costs determination are removed. I reserved my decision on that application. These are my reasons for deciding that question.
Special costs order
2 Legal Profession Act s 280(2) empowers the court, if it is of the opinion that the amount of costs allowable in respect of a matter under a cost determination is inadequate because of the unusual difficulty, complexity or importance of the matter to, amongst other things, remove limits on costs fixed in the determination.
3 Section 280(2) requires a two step process. First, the court must form a view that the costs allowable in respect of a matter under a cost determination are inadequate. The requirement of inadequacy will be demonstrated if the application shows that there is a fairly arguable case that the applicant's costs may tax at an amount which is greater than the limit that would be imposed by the relevant cost determination: Heartlink Ltd v Jones As Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254 (S) [16] (Martin CJ). An applicant often demonstrates an arguable case to the effect that its costs may tax above the amount prescribed by the relevant determination by presenting a draft bill of costs. The plaintiff did not do that in this case. It is not necessary. Whether or not the amount of costs allowable under a Costs Determination is inadequate because of the unusual difficulty, complexity or importance of the matter is to be addressed as a matter of impression rather than detailed evaluation. In some cases, it may be necessary to prove the inadequacy by presenting a draft bill of costs or other specific evidence. In other cases, the court may be able to form a view from its own knowledge of the case: Frigger v Lean [2012] WASCA 66 [81] (Allanson J with whom Newnes and Murphy JJA agreed).
4 I case managed this action as well as hearing the trial. The trial was substantial. It lasted nine days. The plaintiff was represented by two counsel. In my opinion the briefing of second counsel was reasonably necessary in the circumstances of this case but it is no longer necessary to certify for second counsel. The plaintiff called two witnesses in addition to the plaintiff himself. The plaintiff's witness statement was relatively lengthy as might be expected in a case of this sort. The only other non-expert witness called by the plaintiff, Mr Pande, lives in the United States and that fact would have added to the cost involved in preparing his witness statement, although his evidence was not extensive. The third witness called by the plaintiff was an expert witness, Mr Ryan. I have made a separate order that the plaintiff's costs are to be taxed with an allowance for the expert costs of Mr Ryan.
5 The plaintiff says that it is fairly arguable that a taxing officer may allow an amount which is greater than the limits imposed by the costs determination having regard to the following matters:
1. the importance of the outcome of the litigation to the plaintiff in his particular circumstances as an individual litigant (the plaintiff refers to and relies in this regard on his affidavit sworn on 19 September 2013 in opposition to the defendant's application to vacate the trial dates):
2. the late success of the plaintiff in obtaining leave to enforce the issue of subpoenas against the directors of the defendant and the need for urgent evaluation of the hundreds of documents produced in written response to the subpoena;
3. the late provision of witness statements by the defendant's witnesses;
4. the length and contents of the plaintiff's opening submissions (126 paragraphs/42 pages). In that regard, the opening submissions dealt comprehensively with the difficult questions of law posed by Commonwealth Bank v Barker;
5. the length and complexity of the plaintiff's closing submissions (188 paragraphs/63 pages);
6. the hours the Court sat especially to take evidence from witnesses by videolink from outside Australia;
7. the length and complexity of the Court's judgment;
8. finally, the fact that the Legal Practitioner (Supreme Court) (Contentious Business) Costs Determination 2012 was replaced after the conclusion of trial but before the delivery of judgment with the Legal Profession (Supreme Court) (Contentious Business) Determination 2014 Cost Determination allowing significantly higher allowances for existing scale items, and the introduction of a new scale item 20(g), which makes allowance for preparation of written closing submissions, and which prior to the 2014 determination would need to be accommodated within the limits of scale item 20(a).
6 Having regard to those matters and my knowledge of the matter gained as case manager and trial judge, I find there is a fairly arguable case that the plaintiff's costs may tax at an amount which is greater than the limit that would be imposed by the relevant costs determination and hence I have formed the opinion that the amount of costs allowable in respect of this matter under the relevant costs determination is inadequate.
Importance
7 Having formed the opinion that the plaintiff's costs may tax at an amount which is greater than the limit imposed by the relevant costs determination it is necessary to determine whether or not that inadequacy flows from the unusual difficulty, complexity or importance of the matter. The plaintiff relies only on the importance of the matter. Whether the costs allowable are inadequate and whether they are inadequate because of the unusual difficulty, complexity or importance of the matter are interrelated questions. In CMA Contracting Pty Ltd v John Holland Pty Ltd [2011] WASC 249 Allanson J said:
The two questions are interrelated: the difficulty or complexity or importance of the issues at stake to the parties is relevant to the degree of work that may be properly and reasonably done in preparing for and presenting the case [2].
8 The word 'unusual' does not qualify the word 'importance'. The criterion of importance may be met having regard to the interests of the parties only. To paraphrase George Orwell, all cases are important to the parties but some are more important than others. Whether or not a case is sufficiently important depends on the nature and circumstances of each case. I am satisfied that this action was of great significance to the plaintiff because of the cause of action, the relief sought and the effect on the plaintiff of the outcome of the trial. The plaintiff is a geologist. He has been an executive director of an exploration company for the last 20 years. He was in effect summarily dismissed by Central. He has not been able to obtain remunerative employment since. He is in difficult financial circumstances. The plaintiff is 65 years old. He has been awarded damages of $1,598,298. He claimed damages greater than that. The outcome of this action is of great significance to the plaintiff's financial wellbeing and his future. Whether or not he was lawfully dismissed is of significance to his professional standing and future prospects of gaining a directorship or employment as an executive.
9 I am of the opinion that the amount of costs allowable in respect of this matter under the relevant cost determination is inadequate because of the importance of the matter. The costs should be taxed on the basis that the limits on costs fixed in any relevant cost determination are removed. It will be for the taxing officer to determine whether or not the limit in relation to any particular item should be raised and if so to what amount.
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