Juris COR Group Pty Ltd v Price
[2020] WASC 308
•28 AUGUST 2020
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
CITATION: JURIS COR GROUP PTY LTD -v- PRICE [2020] WASC 308
CORAM: HILL J
HEARD: ON THE PAPERS
DELIVERED : 28 AUGUST 2020
FILE NO/S: LPA 8 of 2019
BETWEEN: JURIS COR GROUP PTY LTD
Applicant
AND
RICHARD PRICE
Respondent
Catchwords:
Costs - Review of taxation - Turns on own facts
Legislation:
Legal Profession Act 2008 (WA), s 260, s 261, s 267, s 268, s 301, s 302
Rules of the Supreme Court 1971 (WA), O 66 r 53, O 66 r 54, O 66 r 55
Result:
Application dismissed
Category: B
Representation:
Counsel:
| Applicant | : | No appearance |
| Respondent | : | No appearance |
Solicitors:
| Applicant | : | Juris Cor Legal |
| Respondent | : | Integra Legal |
Case(s) referred to in decision(s):
Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27
Caratti v Mammoth Investments Pty Ltd [2016] WASCA 84; (2016) 50 WAR 84
City of Belmont v Saldanha [No 2] [2018] WASC 278
Farrar (formerly Sweeney) v Julia Armitage [2015] QCA 289
Gregg Lawyers Pty Ltd v Viki Maree Farrar (formerly Sweeney) [2014] QDC 194
LM v K Lawyers [No 2] [2015] WASC 245
Mathieson Nominees Pty Ltd v AJH Lawyers [2013] VSC 325
Nicholson Clement Lawyers v Hewson [2014] WASC 416
Shire of Katanning v Bride [No 5] [2014] WASC 470
The Australasian Lawyers Group Pty Ltd t/as Butlers Barristers & Solicitors v Morgan [2018] WASC 69
HILL J:
On 28 February 2020, a registrar acting as a taxing officer assessed the costs the subject of the respondent's bill of costs and allowed it in the sum of $18,303.76.
On 13 March 2020, the applicant filed a request to review the taxation of the bill of costs, pursuant to O 66 r 55 of the Rules of the Supreme Court 1971 (WA) (Rules). Specifically, the applicant seeks to review:
(a)the finding that the respondent complied with his ongoing obligation of disclosure pursuant to s 267 of the Legal Profession Act 2008 (WA) (Act); and
(b)items 5, 6, 9, 11, 22, 25 and 27 of the respondent's bill of costs.
The parties agreed that the application be determined on the papers.
For the reasons set out below, while I consider the taxing officer made an error in principle in considering whether s 267 of the Act applied to the retainer of the respondent, no order needs to be made to rectify this error. In respect of the remaining items, no error of principle has been identified. Accordingly, the application should be dismissed.
Legal Principles on review of taxation
The legal principles governing a review of taxation were summarised by Vaughan J in City of Belmont v Saldanha [No 2] as follows:[1]
[1] City of Belmont v Saldanha [No 2] [2018] WASC 278 [30] - [43].
Order 66 r 32 sets out the rules concerning taxation of costs. It provides that where bills of costs are to be taxed, the bill is to be taxed, allowed and certified by the taxing officer. Order 66 r 43 provides that the decision of the taxing officer on all questions of fact is final. Order 66 also includes various other rules concerning taxation of costs including how a bill is to be prepared (r 42) and the powers of a taxing officer (r 44).
Under O 66 r 53 a party who contends that the taxing officer has made an error in principle in allowing or disallowing any item or part of an item in a bill of costs may apply to the taxing officer for a review of the taxation. The party must make a written objection specifying the items or parts of items objected to and the grounds and reasons for the objections. Order 66 r 54 requires the taxing officer to then reconsider and review his or her taxation in relation to the objections; and, if so required, state the ground and reason of his or her decision on the objections.
The taxing officer's reasons need not be lengthy and detailed expositions. But they must fairly reveal the process of reasoning whereby the objection was allowed or disallowed together with, where necessary, the matters that were taken into account or disregarded in the process. The necessity for adequate reasons is obvious. The effectiveness of the review process depends on the sufficiency of the reasons given.
…
If a party is dissatisfied with the certificate of the taxing officer upon review, by O 66 r 55 the party may apply to a judge in chambers for an order to review the taxation as to particular items or parts of items. On an application under O 66 r 55 only items covered by the objections carried in before the initial review by the taxing officer may be considered. In that way the making of an objection under r 53 is the foundation for the existence of a judge's power under r 55; if there is no objection to an item or part of an item under r 53 there can be no application under r 55. The certificate of the taxing officer is otherwise final and conclusive as to all matters which have not been objected to in accordance with the rules (O 66 r 55(3)).
Under O 66 r 55(2) the judge, if of the opinion that the taxing officer has made an 'error in principle', may make any order to rectify the error that he or she thinks just.
The applicant for review … bears the onus of satisfying the court that the decision reached by the taxing officer is wrong. For a decision to be 'wrong' it must be shown that there is an error in principle.
The review of a taxing officer's decision attracts the usual principles that apply where appellate jurisdiction is exercised in respect of decisions involving a discretionary judgment. There is a strong presumption in favour of the correctness of the decision. The decision will be affirmed unless the court is satisfied that it is clearly wrong.
Errors in principle may be made both in determining whether an item should be allowed and in determining the amount that should be allowed for an item. However, it is unusual for an error in principle to be made as to quantum. An 'error in principle' on such a basis can only be established if it is shown that no taxing officer, acting reasonably, could ever have taxed the item at that amount. The amount allowed must be so extraordinary as to be demonstrable of an error in principle. Thus, a decision of a taxing officer as to quantum is generally final except in an exceptional case.
This is the position because a taxing officer has a wide discretion. A judge will not usually be as familiar with the taxing process as a taxing officer and therefore will not be as competent to say what is the proper amount to be allowed. As Kenneth Martin J has recognised [in WJ Green & Co (1984) Pty Ltd v Tace Pty Ltd [No 4] [2010] WASC 363 [23]]:
… taxing officers hold expertise in taxations about costs determinations. They deal in the day-to-day nitty-gritty of assessing the costs in litigation, by reference to scales and allowances at a level of detail that judges do not. That is one reason why any further review opportunity window that is allowed under O 66 r 55 to a judge is an extremely limited one.
There is an error in principle where a taxing officer acts on a wrong principle. The court will review the decision for the purpose of determining the principle that should be applied.
An error in principle may be inferred from a decision of the taxing officer if it appears that the taxing officer's discretion has not been exercised at all or has been exercised in a manner that is manifestly wrong. It may be that the exact nature of the error is not discoverable; if so, it is sufficient that the result is so unreasonable or plainly unjust that the court may infer that there has been a failure to properly exercise the taxing officer's discretion.
There may also be an error in principle in giving weight to extraneous or irrelevant matters or in failing to give weight or sufficient weight to relevant considerations. There is also an obiter suggestion in Australian Coal & Shale Employees' Federation v The Commonwealth to the effect that there might be an error in principle in making a mistake as to the facts. No such error of principle is asserted in the defendants' application for review. Accordingly, it is unnecessary to determine whether a mistake as to the facts may constitute an error in principle. It suffices to observe that there may be a difficulty in such an argument so far as O 66 r 43 provides that the taxing officer's decision on all questions of fact is final. [citations omitted]
Order 66 r 53 to r 55 of the Rules deal with 'an error in principle in allowing or disallowing any item or part of an item in a bill of costs'. Accordingly, it is generally necessary that any errors of principle are related to specific items within the bill of costs.[2] However, in a rare case, each item may be objected to where it is contended that the taxing officer adopted an erroneous approach which affected the whole of the assessment.[3]
[2] Shire of Katanning v Bride [No 5] [2014] WASC 470 [11].
[3] City of Belmont v Saldanha [No 2] [47] citing with approval The Australasian Lawyers Group Pty Ltd t/as Butlers Barristers & Solicitors v Morgan [2018] WASC 69 [74] ‑ [78].
Background Facts
In accordance with O 66 r 43 of the Rules, this summary of the background facts has been prepared from the reasons for decision of the taxing officer whose decision on all questions of fact is final.
On 25 October 2018, the applicant, a legal firm based in New South Wales, engaged the respondent, a barrister in Western Australia, in relation to the defence of proceedings commenced in the District Court of Western Australia involving a contract for the sale of land. At the time both the applicant and the respondent were retained, a defence had already been filed.[4]
[4] Reasons for decision [2].
On his engagement, the respondent sent the applicant a costs agreement. Under the costs agreement:[5]
(a)the respondent disclosed that his fees were $540 per hour plus GST with items rounded up or down to the nearest tenth of an hour;
(b)invoices would be sent from time to time with each invoice payable within 30 days. If an invoice remained outstanding for 30 days, the respondent was entitled to charge interest at the rate prescribed by the regulations to the Act;
(c)the applicant was liable for payment of the respondent's invoices even if they had not received the funds from their client; and
(d)the respondent agreed to disclose the necessary information to the applicant to enable them to comply with their obligations under s 261(1) and s 267 of the Act.
[5] Reasons for decision [3].
The costs agreement was not signed by the applicant but the parties proceeded on the taxation before the Registrar on the basis that the agreement applied to the assessment of costs.[6]
[6] Reasons for decision [4].
On the same date, 25 October 2018, the respondent sent to the applicant a letter containing his costs disclosure. The costs disclosure provided:[7]
[7] Reasons for decision [4].
Estimate of my legal costs (section 260(1)(c))
Based on the information currently available to me, it is not reasonably practicable for me to estimate my total legal fees in carrying out the instructions. The range of my estimates for carrying out the instructions are:
Nature or stages of work
Estimated time required (hrs)
Value (excluding GST)
Review brief, provided advice on disclosure
1
$540
Provide advice on further matters identified in points 3-6 of brief
5-15 hours
$2,700-8,100
Preparation for and attendance at directions hearing
1-2 hours
$540-1080
The costs of acting up to and at a defended trial, including attendance at mediation, preparation for trial, trial say 1-2 days, is approximated at say $50,000 (plus GST) assuming say 90-100 hours in total. This assumes the present parties, not the addition of any other party by way of cross-claim.
Plus GST
The letter also disclosed the variables that were likely to affect his costs and stated that the estimate was an indication only and that the respondent was not bound by it.[8]
[8] Reasons for decision [4].
On 18 December 2018, the respondent provided an updated estimate to the applicant to settle and finalise the defence of 'say 6‑7 hours at $3240‑3780 plus GST'.[9] On 22 January 2019, the respondent provided the applicant with a draft defence and advised that 'the costs (to date) taken in and about preparation of the amended defence, and related issues have exceeded my last estimate'.[10]
[9] Reasons for decision [135].
[10] Reasons for decision [137].
Between November 2018 and January 2019, the respondent issued three invoices to the applicant totalling $17,701.20. On 29 January 2019, the applicant requested itemised invoices which were provided by the respondent. The itemised bills indicated that the respondent had capped his fees and not charged for all work he had done on the matter.[11]
[11] Reasons for decision [5].
On 11 March 2019, the applicant applied for an assessment of the respondent's costs.[12] On 27 May 2019, the respondent filed a bill of costs in the amount of $23,878.80. The bill of costs exceeded the itemised invoices as the respondent sought to recover fees for all the work he had performed rather than the capped fees.[13]
[12] Reasons for decision [7].
[13] Reasons for decision [7].
On 30 July 2019, at a hearing for the assessment of the bill of costs, the registrar disallowed item 8 and assessed the bill of costs in the sum of $23,232.21. At the hearing, and before the allocator was signed, the registrar made programming directions in the event that either party objected to the assessment and sought a review of the assessment under O 66 r 53 of the Rules.[14]
[14] Reasons for decision [9].
On 13 August 2019, the applicant filed an objection to the assessment pursuant to O 66 r 53 of the Rules.[15] The objection raised the following matters:[16]
(a)whether the total amount of the respondent's costs should be limited to the invoiced amount and not the amount claimed in the bill of costs;
(b)in respect of items 5, 6, 8, 9, 11, 22, 25 and 27, whether the taxing officer failed to apply the criteria in s 301(1) of the Act having regard to the matters in s 301(2) of the Act;
(c)whether the respondent, as a self-represented litigant, was entitled to his costs of the assessment;
(d)the failure by the taxing officer to find there had been a breach of s 267 of the Act by the respondent.
[15] Reasons for decision [11].
[16] Reasons for decision [15].
The parties filed written submissions in respect of the objections. On 28 February 2020, the taxing officer delivered detailed reasons for her decision and signed the allocator in the amount of $18,303.76. This comprised $17,701.20 for the amount of the disputed costs together with $602.56 for interest.
In summary, the taxing officer found that the maximum allowable on the assessment should have been limited to $17,701.20, being the amount of the invoices. The objection to item 27 of the bill of costs was partially allowed and the taxing officer taxed off an amount of $1,080. The taxing officer also found that the respondent, as a self-represented litigant, was not entitled to his costs of the assessment. Otherwise, the objections to the items in the bill of costs were dismissed.
On 13 March 2020, the applicant filed a request for a review of the taxation of the bill of costs on the grounds summarised at [2].
Disposition
The applicant's request for review was in two discrete parts. The first part concerned the consideration of s 267 of the Act and its application to the assessment of the bill of costs. The second part was the applicant's objection to specific items in the bill of costs.
Section 267 of the Act - Ongoing obligation of disclosure
The applicant asserts that there were three errors in principle in the taxing officer's consideration of s 267 of the Act. First, the taxing officer erred in finding that the applicant was required to prove there was an inference that the total costs of the matter would exceed the costs disclosure. The applicant submits that what was required to be assessed was whether there was a 'substantial change' and if such a change was disclosed.[17] Second, having found that after a review of the brief it gave rise to 'difficult factual and interpretive issues', the taxing officer should have considered these matters in determining whether there had been a breach of s 267 of the Act.[18] Even if the reference to this matter was in another context, the taxing officer was required to consider it in relation to this issue.[19] Third, in considering whether there was a 'substantial change', the appropriate comparison was not between the invoiced amount and the total of the estimated costs (as found by the taxing officer) but between the cost of amount of time spent on the matter by the respondent to date and the total estimate.[20]
[17] Request for Review [27].
[18] Request for Review [29] – [30].
[19] Applicant's submissions in response [7].
[20] Request for Review [31] – [32].
The applicant submitted that the respondent was obliged to inform the applicant at the relevant stage of the matter, that a disproportionate fee compared to the costs estimate had been incurred, or that the rate of fees being charged had substantially changed. They contended that it was insufficient for the respondent to simply disclose that additional costs would be incurred.[21]
[21] Applicant's submissions in response [22].
The applicant contends that if the respondent failed to comply with the ongoing obligation of disclosure, 'the costs agreement would be set aside'.[22] If the costs agreement were set aside, the assessment of costs would occur by reference to the relevant costs determination and not by reference to the costs agreement.[23]
[22] Request for Review [35].
[23] Legal Profession Act 2008 (WA), s 301(1)(c), s 302, s 303.
The respondent submits that the applicant's objection based on s 267 of the Act is flawed as the applicant does not relate what it contends are errors in principle to specific items objected to in the bill of costs.[24] The respondent contends that the only items of the bill of costs objected to by the applicant in relation to this argument on the review by the taxing officer were items 22 and 25. The applicant had not previously invited the court to set aside the costs agreement and cannot raise this at this stage.
[24] Respondent's submissions [19], [22].
Further, the respondent submits that the applicant's contention that the respondent breached s 267 of the Act by not disclosing that the rate of fees being charged had changed, was not previously raised as an objection to the entirety of the bill. The respondent submits that the objection goes beyond items 22 and 25, and the applicant cannot alter its position on this application by raising additional matters. In any event, the respondent relies on the taxing officer's findings that there was no evidential basis to find that the costs of the action would necessarily exceed the amount estimated.[25]
[25] Reasons for decision [128].
The respondent contended that the applicant's argument was not supported by proper particulars or evidence, and referred to a number of matters to support this. I note that the fourth of these matters refers in passing to the assumption on which the parties appear to have proceeded, namely that s 267 of the Act applies to a barrister.
Given this assumption, I invited the parties to make further submissions as to whether s 267 applies to the retainer of the respondent and if not, what impact this may have.
The applicant contends that on a proper construction of div 3 of the Act, s 267, when read with s 260 and s 261 of the Act, applied to the respondent's retainer.[26] In essence, the applicant submitted that a barrister was obliged to provide information to enable a solicitor to comply with their disclosure obligations to their client. On this basis, the applicant contended that the obligations under s 261(2) extended to a requirement to provide sufficient information to enable the solicitor to comply with their obligations under s 261(1) and s 267.
[26] Applicant's further submissions filed 25 August 2020 [1].
The respondent contends that s 267 does not apply to this retainer.
Statutory scheme - costs disclosure
Part 10 of the Act governs the obligations of legal practitioners in relation to disclosure of their costs and the assessment of their costs.
Section 260 of the Act sets out the obligations of disclosure of a law practice to their client. Specifically:
(1)A law practice must disclose to a client in accordance with this Division -
(a)the basis on which legal costs will be calculated, including whether a costs determination applies to any of the legal costs; and
(b)the client's right to -
(i)negotiate a costs agreement with the law practice; and
(ii)receive a bill from the law practice; and
(iii)request an itemised bill after receipt of a lump sum bill; and
(iv)be notified under section 267 of any substantial change to the matters disclosed under this section;
and
(c)an estimate of the total legal costs if reasonably practicable or, if that is not reasonably practicable -
(i)a range of estimates of the total legal costs; and
(ii)an explanation of the major variables that will affect the calculation of those costs;
(d)details of the intervals (if any) at which the client will be billed.
Where a law practice intends to retain another law practice on behalf of a client, the disclosure obligation is governed by s 261 of the Act. Relevantly, this provides that:
(1)If a law practice intends to retain another law practice on behalf of a client, the first law practice must disclose to the client the details specified in section 260(1)(a), (c) and (d) in relation to the other law practice, in addition to any information required to be disclosed to the client under section 260.
(2)A law practice retained or to be retained on behalf of a client by another law practice is not required to make disclosure to the client under section 260, but must disclose to the other law practice the information necessary for the other law practice to comply with subsection (1).
Pursuant to s 267 of the Act:
A law practice must, in writing, disclose to a client any substantial change to anything included in a disclosure already made under this Division as soon as is reasonably practicable after the law practice becomes aware of that change.
The effect of a law practice's failure to disclose a substantial change in the cost disclosure to a client is set out in s 268 of the Act. Where there has been a failure to disclose any substantial change to the disclosure, the legal costs are not required to be paid unless they have been assessed under div 8 of the Act,[27] the legal practice cannot maintain proceedings for recovery of the costs,[28] an application 'may' be made under s 288 of the Act to set aside the costs agreement,[29] and on an assessment of the costs, the amount of costs may be reduced by the amount considered by the taxing officer to be 'proportionate to the seriousness of the failure to disclose'.[30]
[27] Legal Profession Act 2008 (WA), s 268(1).
[28] Legal Profession Act 2008 (WA), s 268(2).
[29] Legal Profession Act 2008 (WA), s 268(3).
[30] Legal Profession Act 2008 (WA), s 268(4).
Where a law practice retains another law practice and fails to disclose something to a client solely because the retained practice failed to disclose the information required by s 261(2) of the Act, s 268(1) to s 268(4) apply to the legal costs owing to the retained law practice.
Construction of s 267 of the Act
The question of whether the respondent was required to provide an updated disclosure to the applicant and, if so, what impact this has on the assessment of the bill of costs is a matter of statutory construction.
The starting point in considering the meaning of s 267 of the Act is to consider the ordinary and grammatical sense of the statutory words to be interpreted having regard to their context and legislative purpose.[31] Extrinsic materials can be considered to confirm the ordinary meaning conveyed by the text of the provision, or to determine the meaning of a provision where the provision is ambiguous or obscure, or where the ordinary meaning gives rise to a result that is manifestly absurd or unreasonable.[32]
[31] Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 [4].
[32] Interpretation Act 1984 (WA), s 19(1).
The approach to statutory construction was summarised by Buss JA (as he then was) in Caratti v Mammoth Investments Pty Ltd as follows:[33]
The modern approach to statutory construction is purposive. The statutory text is the surest guide to Parliament's intention. A decision as to the meaning of the text requires consideration of the context, in its widest sense, including the general purpose and policy of the provision.
The context includes the existing state of the law, the history of the legislative scheme and the mischief to which the statute is directed.
The purpose of legislation must be derived from the statutory text and not from any assumption about the desired or desirable reach or operation of the relevant provisions. The intended reach of a legislative provision is to be discerned from the words of the provision and not by making an a priori assumption about its purpose. (footnotes omitted)
[33] Caratti v Mammoth Investments Pty Ltd [2016] WASCA 84; (2016) 50 WAR 84 [390] - [392].
Part 10, div 3 of the Act governs the obligations of legal practitioners to make disclosures to their clients as to the costs of their engagement. The obligations of disclosure placed on a law practice by reason of s 260(1) of the Act are obligations owed by a law practice to their client.
Where a barrister is retained by a law practice, the barrister's disclosure obligations are governed by s 261, namely the retention of a law practice (barrister) by another law practice (firm of solicitors). The barrister is required to provide sufficient disclosure to their instructing solicitors so that the instructing solicitors can comply with their obligations to their client under s 260 of the Act. This requires the barrister to disclose the basis on which costs will be calculated, an estimate of the total costs, or if that is not reasonably practicable a range of estimates and an explanation of the major variables, and details of the intervals at which the barrister will submit invoices.
Section 267 of the Act governs the obligation of a legal practice to update their client on any substantial changes to the disclosure. On a plain reading of the text of this section, it does not apply to a retainer between a barrister and their instructing solicitors. This construction is supported by the language in pt 10, div 3 which clearly distinguishes between law practice, a law practice retained by another law practice, and client.
This construction is consistent with the construction of identical statutory provisions in Queensland.[34]
[34] Farrar (formerly Sweeney) v Julia Armitage [2015] QCA 289 [53] – [55]; Gregg Lawyers Pty Ltd v Viki Maree Farrar (formerly Sweeney) [2014] QDC 194.
In this case, the parties and the taxing officer proceeded on the basis that s 267 of the Act applied to the retainer between the applicant and respondent. While the respondent's submissions stated that they were filed 'assuming the section applied to the respondent',[35] it does not appear that the question as to whether this section applied to the retainer was the subject of any argument or submission before the taxing officer.
[35] Respondent's amended submissions in reply filed 8 July 2019 [13(i)]; Respondent's submissions in reply to applicant's objection to assessment filed 20 August 2019 [43].
For the reasons set out above, s 267 of the Act does not apply to the costs agreement between the applicant and the respondent. The consideration of the section by the taxing officer was, in my view, an error in principle.
Having found an error in principle, it is necessary for me to consider what order, if any, should be made to rectify the error that has been identified.[36] In this case, I do not consider that any order should be made to rectify the error. This is because the taxing officer found that s 267 of the Act was not breached and, as a consequence, the taxing officer's consideration of this section had no impact on her ultimate decision.
[36] Rules of the Supreme Court 1971 (WA) O 66 r 55.
In their submissions filed 25 August 2020, the applicant sought to rely on cl 8 of the retainer agreement. This was not a matter that was raised before the taxing officer on the objection nor raised in the review. As was noted by Vaughan J, the making of an objection under O 66 r 53 is the foundation for the existence of the review under O 66 r 55.[37] There is no foundation for a review of the taxation on the terms of cl 8 of the retainer.
Specific items
[37] City of Belmont v Saldanha [No 2] [35], [106].
I turn now to the specific items raised by the applicant in its application for review.
Items 5 and 6: Strata Act issue
Items 5 and 6 were claims for legal research and an email from the respondent to the applicant in respect of 'Strata Title Act issues'. A total of three hours is claimed for this work.
The applicant submits that this work was not carried out in a reasonable manner. The applicant contends there are two errors of principle in the taxing officer's decision. First, the failure to consider the respondent's email to the applicant dated 2 November 2018 and second, in finding it was reasonable for the respondent to conduct further research without explicit instructions from the applicant.
The applicant contends that no reasonable taxing officer would disregard this evidence, alternatively that she exercised her discretion in a manifestly incorrect manner by failing to consider this email. For these reasons, the applicant contends that a further amount should be taxed off these items.
The respondent submitted that the applicant's objections were essentially an objection to quantum and did not identify an error in principle. The respondent contended that the registrar made no error in principle in her assessment of these items.
In the objection and review before the registrar, the error of principle asserted by the applicant was advanced on a number of grounds. These were that the length of time allocated was unreasonable having regard to the respondent being an experienced barrister in this area, the same issue had already been considered and allowed in item 4, the issue only concerned three provisions of the Strata Titles Act, no further legal strategy was identified nor was there one, the notice requiring consideration was only a one page document and that the registrar should have had regard to r 57 of the Western Australian Barristers' Rules (Barristers' Rules) in assessing the respondent's costs.
The registrar's reasons for rejecting the applicant's contentions are set out at [70] ‑ [75] of her reasons for decision. The reasons given by the registrar on this aspect of the applicant's objection are clear and do not disclose any error in principle in the allowance she made. The registrar considered whether the work was reasonably required and carried out in a reasonable manner pursuant to s 301 of the Act. Further, an allowance of $1,782 is not so high that it can be concluded that no taxing officer acting reasonably could ever have taxed the item at that amount.
In my view, the applicant's objection does not identify any error of principle and is properly characterised as an objection to quantum.
I turn now to consider the objection in relation to r 57 of the Barristers' Rules. Rule 57 of the Barristers' Rules provides that:
A barrister must seek to ensure that work which the barrister is briefed to do in relation to a case is done so as to:
(a) confine the case to identified issues which are genuinely in dispute;
(b) have the case ready to be heard as soon as practicable;
(c) present the identified issues in dispute clearly and succinctly;
(d) limit evidence, including cross-examination, to that which is reasonably necessary to advance and protect the client's interests which are at stake in the case; and
(e) occupy as short a time in court as is reasonably necessary to advance and protect the client's interests which are at stake in the case.
The applicant contended that the taxing officer should have had regard to this rule as a relevant matter, as provided for in s 301(2)(j) of the Act. The registrar's reasons for rejecting the applicant's reliance on this rule is at [60] ‑ [68] and [74] of her reasons for decision.
The relevant provisions of the Act are s 301 and s 302. These sections relevantly provide that:
301. Criteria for assessment
(1)In conducting an assessment of legal costs, a taxing officer must consider -
(a)whether or not it was reasonable to carry out the work to which the legal costs relate; and
(b)whether or not the work was carried out in a reasonable manner; and
(c)the fairness and reasonableness of the amount of legal costs in relation to the work, except to the extent that section 302 or 303 applies to any disputed costs.
(2)In considering what is a fair and reasonable amount of legal costs, the taxing officer may have regard to any or all of the following matters -
(a)whether the law practice and any Australian legal practitioner or Australian‑registered foreign lawyer acting on its behalf complied with this Act;
(b)any disclosure made by the law practice under Division 3;
(c)any relevant advertisement as to —
(i)the law practice's costs; or
(ii)the skills of the law practice or of any Australian legal practitioner or Australian‑registered foreign lawyer acting on its behalf;
(d)the skill, labour and responsibility displayed on the part of the Australian legal practitioner or Australian‑registered foreign lawyer responsible for the matter;
(e)the retainer and whether the work was done was within the scope of the retainer;
(f)the complexity, novelty or difficulty of the matter;
(g)the quality of the work done;
(h)the place where, and circumstances in which, the legal services were provided;
(i)the time within which the work was required to be done;
(j)any other relevant matter.
302. Assessment of costs by reference to costs agreement
(1)A taxing officer must assess the amount of any disputed costs that are subject to a costs agreement by reference to the provisions of the costs agreement if -
(a)a relevant provision of the costs agreement specifies the amount, or a rate or other means for calculating the amount, of the costs; and
(b)the agreement has not been set aside under section 288,
unless the taxing officer is satisfied that —
(c)the agreement does not comply in a material respect with any applicable disclosure requirements of Division 3; or
(d)Division 6 precludes the law practice concerned from recovering the amount of the costs; or
(e)the parties otherwise agree.
(2)The taxing officer is not required to initiate an examination of the matters referred to in subsection (1)(c) and (d).
The question as to when the matters provided for in s 301(2) (and its equivalent in other jurisdictions) should be considered by a taxing officer on an assessment of costs has been considered in a number of cases.[38] These cases have held that where there is a costs agreement, the taxing officer does not apply s 301(2) in considering what a fair and reasonable amount of costs is; the assessment is done by reference to the costs agreement.[39]
[38] Mathieson Nominees Pty Ltd v AJH Lawyers [2013] VSC 325; Nicholson Clement Lawyers v Hewson [2014] WASC 416; LM v K Lawyers [No 2] [2015] WASC 245.
[39] Legal Profession Act 2008 (WA), s 302.
In my view, this construction is consistent with a plain reading of the text of s 301 of the Act. That is, where there is a costs agreement, s 301(1)(c) and, as a consequence, s 301(2) of the Act have no work to do. Any assessment is governed by the considerations in s 301(1)(a) and s 301(1)(b) of the Act. Accordingly, I do not consider there is any error in principle in the approach adopted by the taxing officer in respect of r 57 of the Barristers' Rules.
For these reasons, it is my view that the registrar made no error in principle as alleged by the applicant in allowing items 5 and 6 in the amount of $1,782.
Items 9 and 11: FIRB
Items 9 and 11 were claims for consideration and research of FIRB and preparing and settling an email to the applicant.
The applicant contends that the work was not carried out in a reasonable manner and that the registrar erred in principle in failing to consider the respondent's email dated 2 November 2018. The applicant contends there are four errors of principle in the taxing officer's decision. First, the failure to consider the respondent's email to the applicant dated 2 November 2018; second, in finding it was reasonable for the respondent to conduct further research without detailed facts or instructions from the applicant; third, in failing to have proper regard to r 57 of the Barristers' Rules; and fourth, the fees were not fair or reasonable. For these reasons, the applicant contends that a further amount should be taxed off these matters.
The respondent submitted that these objections did not identify an error in principle and were, in essence, an objection to the quantum assessed. The respondent contended that the registrar made no error in principle in her assessment of these items.
The registrar's reasons for rejecting the applicant's contentions are at [79] ‑ [89] of her reasons for decision. The registrar considered whether the work was reasonably required and carried out in a reasonable manner pursuant to s 301 of the Act. The reasons given by the registrar on this aspect of the applicant's objection are clear and do not disclose any error in principle in the allowance made. In addition, an allowance of $3,373 is not so high that it can be concluded that no taxing officer acting reasonably could ever have taxed the item at that amount.
I note that in addition to this primary reason, the registrar rejected the applicant's submissions for two further reasons: first, it was not referred to or relied upon by the applicant at the assessment of costs; and second, in assessing the costs claimed by the respondent, the respondent's experience and practice were referred to in the context of whether the work done was necessary and the time spent was reasonable.
In my view, the applicant's objection does not identify any error of principle and is properly characterised as an objection to quantum.
Items 22, 25 and 27: Considering cross-claim and amending defence
Items 22, 25 and 27 were claims for work completed by the respondent relating to the cross‑claim and amending the defence.
The applicant contends that the work was not carried out in a reasonable manner, the registrar erred in principle in finding that the amount spent on the amendment of the defence (12 hours after taxing off 2 hours) was fair and reasonable, and that the applicant only instructed the respondent to consider a cross‑claim on the issue of common law misrepresentation. For these reasons, the applicant contends that a further amount should be taxed off these matters.
The respondent submitted that these objections did not identify an error in principle and were, in essence, an objection to the quantum assessed. The respondent contended that on the review, the applicant's objections on items 22 and 25 were limited to an assertion that the work relating to the cross‑claim was not carried out in a reasonable manner having regard to the amount of time spent. With respect to item 27, the respondent's contention is that the applicant's objection is limited to the time spent to amend the defence and that the applicant should not be allowed to expand its objection. In any event, the respondent denied that the registrar made any error in principle in her assessment of these items.
The registrar's reasons for rejecting the applicant's contentions are at [104] ‑ [110] and [111] ‑ [118] of her reasons for decision. The registrar considered whether the work was reasonably required and carried out in a reasonable manner pursuant to s 301 of the Act. On a review of the taxation, the registrar taxed off $1,080. The reasons given by the registrar on this aspect of the applicant's objection are clear and do not disclose any error in principle in the allowance made. In addition, an allowance of $7,711.20 (for 12 hours 48 minutes) for costs associated with both the cross‑claim and defence is not so high that it can be concluded that no taxing officer acting reasonably could ever have taxed the item at that amount. Accordingly, I do not consider that there is any error in principle based on quantum alone.
In my view, the applicant's objection does not identify any error of principle and is properly characterised as an objection to quantum.
Conclusion
For the reasons set out above, the applicant's application should be dismissed.
I will hear from the parties as to the costs of the application. I consider that it would be appropriate to fix the amount to be allowed by way of costs but will hear from the parties both as to this proposal and the amount for which costs should be fixed.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
ME
Associate to the Honourable Justice Hill28 AUGUST 2020
2
11
2