| JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL STREAM : COMMERCIAL & CIVIL ACT : CONSUMER CREDIT (WESTERN AUSTRALIA) ACT 1996 CITATION : KOUPATSIARIS and PEPPER HOME LOANS [2010] WASAT 146 (S) MEMBER : MR C RAYMOND (SENIOR MEMBER) HEARD : DETERMINED ON THE DOCUMENTS DELIVERED : 7 OCTOBER 2010 SUPPLEMENTARY
DECISION : 12 NOVEMBER 2010 FILE NO/S : CC 243 of 2010 BETWEEN : BRENDA KOUPATSIARIS STEVE KOUPATSIARIS
Applicants
AND
PEPPER HOME LOANS
Respondent
Catchwords: Consumer credit - Whether costs should be ordered against legal practitioner - Fixing of costs Legislation: Consumer Credit (Western Australia) Code, s 71
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State Administrative Tribunal 2004 (WA), s 47 Result: Costs ordered against applicants Category: B
Representation: Counsel:
Applicants : Mr J Lyons
Respondent : Mr B Smith
Solicitors:
Applicants : Lyons & Lyons
Respondent : Gadens Lawyers
Case(s) referred to in decision(s):
J & P Metals Pty Ltd and Shire of Dardanup [2006] WASAT 282
Koupatsiaris and Pepper Home Loans [2010] WASAT 146
McLane and Permanent Custodian's Limited [2010] WASAT 127
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REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision 1 On 7 October 2010, the Tribunal dismissed proceedings commenced by the applicants under s 71 of the Consumer Credit (Western Australia) Code for orders to reopen a loan contract entered into between the parties, to set aside the contract and consequent relief. In doing so, the Tribunal concluded that the respondent's application for costs should be granted, but left for determination whether costs should be awarded against the applicants' legal representatives and the fixing of the quantum of costs. 2 The applicants' legal representatives were afforded an opportunity to show cause why costs should not be ordered against their firm. 3 The Tribunal accepted the submissions made by the applicants' legal representatives that it was inappropriate to make an award of costs against the applicants' solicitors, Lyons & Lyons, or the principal of that firm, Mr James Lyons. The submissions emphasised that all of the steps taken of which the Tribunal had been critical occurred during a period when the matter was being conducted by a different firm of solicitors. The Tribunal considered the statement of costs filed and served by the respondent which claimed an amount of $2,320 and fixed the costs to be paid by the applicants, in the sum of $1,290.
The application for costs 4 On 7 October 2010, the Tribunal issued an order dismissing these proceedings and its reason for that decision are published in Koupatsiaris and Pepper Home Loans [2010] WASAT 146 (substantive decision). In doing so, the Tribunal was critical of the way in which the proceedings had been conducted on behalf of the applicants subsequent to a directions hearing on 13 May 2010. At that directions hearing, the applicants had been alerted to the basis upon which the respondent's legal representatives indicated an intention to challenge the jurisdiction of the Tribunal to grant the relief sought. The Tribunal concluded for the reasons expressed in the substantive decision that costs should be awarded in favour of the respondent in respect of the proceedings subsequent to 13 May 2010 but no order awarding costs was made because the Tribunal was concerned about whether the costs should be awarded against the applicants' legal representatives, rather than against the applicants. 5 The Tribunal accordingly made directions on 7 October 2010 to afford the applicants' legal representatives an opportunity to show cause (Page 4)
why costs should not be awarded against them. Directions were also made for the respondent to file a detailed statement of the costs claimed by it in respect of the proceedings subsequent to the directions hearing held on 13 May 2010, showing the various services for which costs were claimed and the rates at which costs had been charged, sufficient to enable the Tribunal to fix the costs payable. The applicants were also afforded an opportunity to make submissions opposing the quantum of the costs claimed. 6 On 15 October 2010, the respondent's solicitor's filed a statement of the costs claimed totalling $2,320. 7 On 2 November 2010, the applicants' legal representatives, Lyons & Lyons, filed a submission dated 3 November 2010 [sic], opposing an award of costs against Mr James Lyons personally. The submissions are filed on the letterhead of Lyons & Lyons which discloses that Mr Lyons is the principal of that firm. 8 No submissions have been made in relation to the quantum of costs, although the abovementioned submissions acknowledge receipt of 'a bill of costs' from the respondent's legal representatives.
The submissions from Lyons & Lyons and conclusion of the Tribunal 9 The submissions detail an understanding that this matter was held over pending the determination of what is referred to as a 'test case' concerning the matter of 'Michael Scales v ANZ & Macquarie'. This is taken to be a reference to two separate proceedings in the Tribunal being Michael David Scales and Macquarie Group Limited matter number CC 153 of 2010 and Michael David Scales and ANZ Banking Group Limited matter number CC 155 of 2010. In both of these matters, the Tribunal has reserved its decision on an application to extend the time for compliance with a springing order, which was put in place as a result of noncompliance with orders of the Tribunal. The submission proceeds further to reflect that the substantive decision and order of the Tribunal dismissing the proceedings issued notwithstanding that this matter was being stood over with all other similar matters pending 'the outcome of the McLean and Scales test cases'. The reference to the McLean case is to a number of proceedings which were determined by the President of the Tribunal, Chaney J, in the reported decision of McLean and Permanent Custodian's Limited [2010] WASAT 127 (McLean), being matters number CC 86, CC 87 of 2010, CC 88 of 2010 and CC 89 of 2010. (Page 5)
10 The above submissions are entirely misconceived, save that it was intended that the McLean and Scales matters were to be determined by the President of the Tribunal in order to establish principles capable of application to particular issues raised in a number of similar matters. But, this particular matter has been programmed quite separately from the other similar matters since the general call over and directions list conducted on 14 June 2010. On that date and in the presence of counsel for the applicants, this matter was programmed for determination on the documents of an application to dismiss the proceedings as being misconceived or lacking in substance under s 47 of the State Administrative Tribunal 2004 (WA). 11 Subsequent to the publication of the substantive submission, the Tribunal is aware that Mr James Lyons deposed to an affidavit on 20 October 2010 in support of the applications to extend time for compliance with the springing orders made in the Scales matters. By that affidavit, Mr Lyons explains the circumstances in which he took over the conduct of the various proceedings from the applicants' former legal representatives. It is evident that the files were transferred to Mr Lyons in a very poor state and that at least in those matters some orders of the Tribunal were missing from the files. It is to be inferred from the submissions in this matter that Mr Lyons is not in possession of the order made by the Tribunal on 14 June 2010. 12 The submissions do, however, draw to the Tribunal's attention that all of the steps taken on behalf of the applicants pursuant to the order made on 14 June 2010 carried out by the applicants' previous solicitors and not Mr Lyons. It would therefore obviously be inappropriate to award costs against Mr Lyons and the costs order will be made against the applicants personally.
Fixing the costs claimed 13 The approach to be taken by the Tribunal in fixing the costs is in accordance with the principles expressed in J & P Metals Pty Ltd and Shire of Dardanup [2006] WASAT 282. Further, guidance is to be provided by the maximum costs permitted under the Legal Practitioners' (State Administrative Tribunal) Determination 2010 (Determination). Although the Determination does not prevent costs in excess of the specified rates per hour being charged pursuant to a written costs agreement, the Determination is a useful guide to what may be regarded as the maximum allowable party and party costs which may be awarded by the Tribunal. Under the Determination, the maximum charge per hour (Page 6)
for a junior practitioner admitted for less than five years is $253 inclusive of GST and the maximum rate for a senior practitioner admitted for five years or more is $352 per hour inclusive of GST. 14 In my view, having regard to the nature of this matter, I consider that the rates to be allowed for a junior practitioner should be $200 per hour inclusive of GST and for a senior practitioner, $300 per hour inclusive of GST. 15 In reviewing the respondent's statement of costs, I consider that all of the services enumerated and the time charged is reasonable and necessary. Applying the above rates to the time charged results in a reduction of the amount claimed of $2,320 to $1,290 and I accordingly fix costs in that latter amount.
Order 16 For the above reasons, the Tribunal will issue an order as follows. 1. On or before 17 December 2010, the applicants do pay the respondent's costs of the proceedings subsequent to 13 May 2010 fixed in the sum of $1,290. |