Mantova Holdings Pty Ltd v Rajlaw Pty Ltd - [2010] WASC 128

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: MANTOVA HOLDINGS PTY LTD -v- RAJLAW PTY LTD [2010] WASC 128

CORAM: MASTER SANDERSON

HEARD: 27 MAY 2010

DELIVERED : 27 MAY 2010

PUBLISHED : 9 JUNE 2010

FILE NO/S: LPA 15 of 2010

BETWEEN: MANTOVA HOLDINGS PTY LTD
Plaintiff
AND
RAJLAW PTY LTD
Defendant

Catchwords:

Taxation of costs - Application for an extension of time to tax costs - Turns on own facts

Legislation:

Nil

Result:

Time extended

Category: B

Representation:

Counsel:

Plaintiff: Mr T M Clavey
Defendant: Mr D J Garnsworthy

Solicitors:

Plaintiff: Clavey Legal
Defendant: Rajlaw Pty Ltd

Case(s) referred to in judgment(s):

Pullinger Readhead Lucas v Golden West Resources Ltd [2009] WASC 140

MASTER SANDERSON: This is the plaintiff's application for an extension of time within which to have a solicitor's bill of costs taxed. At the conclusion of argument, I indicated I would extend time. I said I would publish reasons for that decision. These are those reasons.
There was no dispute as to the facts. What follows is taken from an affidavit of Vincenzo Gaetano Pileggi, sworn 26 March 2010 and filed in support of this application. Mr Pileggi is a director of the plaintiff. He says that in August 2006, he instructed one Mr Robert Mancini, a solicitor in the employ of the defendant, to represent the plaintiff in an action against Abacus Calculators (WA) Pty Ltd. The claim appears to have been a relatively simple one. It involved the purchase of what the plaintiff said was a faulty photocopier. The amount in issue was around $50,000. Proceedings were to be initiated in the Magistrates Court.
Before anything much happened, Mr Mancini left the employ of the defendant. The file was handed to another solicitor employed by the defendant, a Mr Andreas Von Altenstadt. Mr Pileggi first met Mr Von Altenstadt in late October 2006. In November 2006, Mr Von Altenstadt, on behalf of the plaintiff, lodged a claim in the Magistrates Court. A defence and a counterclaim were duly filed. In mid‑February 2007, the plaintiff's defence to counterclaim was lodged. Around that time, the matter effectively stalled. Mr Von Altenstadt told Mr Pileggi advice was being obtained from counsel. Whether that advice was ever obtained is unclear. In any event, around October 2008, Mr Von Altenstadt advised Mr Pileggi he was leaving the defendant firm. The file was then transferred to a Mr Jonathon Bowers Taylor in the defendant's Melbourne office. This was all too much for Mr Pileggi. He transferred his file to another firm.
Between August 2006 and March 2007, the plaintiff was charged $13,542.39 by the defendant for its services. That amount has been paid. The bills making up this amount were rendered on various dates between August 2006 and November 2007. These bills appear as annexures A and B to Mr Pileggi's affidavit.
It is important to note that on each of the bills rendered, there appeared the following:
Within 30 days of receiving this account you may require me by notice in writing to submit the bill of cost to a taxing officer of the Supreme Court for review of the amount of costs charged to you, the subject of this bill of costs.
There was no written costs agreement entered into between the plaintiff and the defendant.
After the determination of the defendant's retainer by the plaintiff, the plaintiff retained the firm of Clavey Legal. At all material times thereafter, Mr Clavey acted for the plaintiff. On 10 December 2008 and 24 December 2008, Mr Clavey requested a copy of any costs agreement between the plaintiff and the defendant. No response was received to either of these two letters. On 5 January 2009, the defendant emailed Clavey Legal, seeking payment of a further bill before the files would be released. Mr Clavey wrote back, pointing out that the defendant, through Mr Von Altenstadt, had agreed to waive this bill. On 24 April 2009, the defendant accepted that the bill had been waived and agreed to release the files. In fact, the files were not released until 26 June 2009.
Thereafter, Mr Clavey reviewed the files. He says that they were in some disorder when received. In January 2010, he advised Mr Pileggi that he was of the view the costs charged were excessive. He suggested an application be made to extend time to have the bills taxed. Mr Pileggi provided the relevant instructions and on 27 January 2010, Mr Clavey wrote to the defendant asking if the defendant would consent to a taxation of costs. No consent was forthcoming. This application was lodged on 29 March 2010.
The principles applicable in determining an application for an extension of time within which to tax costs were set out in Pullinger Readhead Lucas v Golden West Resources Ltd [2009] WASC 140. Although each case must be considered on its merits, relevant factors are:
(1)the reason for the delay;
(2)whether refusal to allow an extension of time may cause injustice to the applicant;
(3)whether there is evidence that suggests the bill may be excessive;
(4)whether, and to what extent, extending time would cause prejudice to the practitioner; and
(5)the practitioner's reasons for opposing the application.
It has to be said that the plaintiff's reasons for the delay in making this application are not entirely convincing. As I have indicated above, each of the bills had endorsed upon it the appropriate advice to the plaintiff that the defendant could be required to submit its bills for taxation if notice was given within 30 days. There is nothing in the evidence to suggest that the plaintiff was not aware of its rights; nor is there any explanation as to why these rights were not exercised. What is implicit in Mr Pileggi's affidavit - although not directly stated - is that he thought the action was proceeding in a proper and appropriate fashion and had no reason to think it was necessary for him to obtain taxation.
Nor is it entirely clear why nothing was done between June 2009, when Clavey Legal received the file, and January of 2010, when Mr Clavey wrote to the defendant asking the defendant to consent to taxation. I accept that it was necessary for Mr Clavey to review and organise the files before advising the plaintiff whether or not the defendant would agree to have its costs taxed and if it would not, whether an application ought be made for an extension of time. However, this is a relatively straightforward matter. It is difficult to see why it should have taken five months to make that decision. No evidence is provided to explain this delay.
There is no doubt the length of the delay and the failure to adequately explain it is a factor which weighs heavily in the defendant's favour.
The question of whether a refusal to allow an extension of time may cause injustice to the applicant and the question of whether there is evidence that suggests the bill may be excessive can be taken together. It appears plain that the defendant has charged pursuant to its usual costs agreement. In fact, there was no costs agreement. That means the defendant's bills would be covered by the scale. Without in any way attempting to perform a taxation of costs within this application, it is plain that the amount charged would exceed the scale. It follows there is evidence of overcharging and a refusal to allow the extension of time may cause an injustice to the plaintiff.
This factor weighs heavily in favour of the application being granted.
There is no evidence that extending time would cause prejudice to the practitioner. It may be said, as counsel submitted, that general prejudice which is always associated with delay would be occasioned to the practitioner. Even accepting that to be the case, the bill would necessarily be based on documents found on the file. As a consequence, it is difficult to see how extending time would cause prejudice to the practitioner. This favours the grant of the extension.
In opposition to this application, the defendant relied on an affidavit of David Christopher Mackie, sworn 21 April 2010. That affidavit provides a general commentary on the evidence relied upon by the plaintiff. It does not suggest any reason why the application is opposed. The thrust of the evidence is that the bills are reasonable. If that is the case, the defendant's position will be vindicated on taxation. In my view, there is no good reason why the practitioner should oppose this application.
In the end, I was satisfied the proper course was to extend time. I accept that the delay on the plaintiff's part is a strong factor in refusing the application. However, I am also satisfied that a refusal to allow and extension of time would cause injustice to the plaintiff, as there is clear evidence that the plaintiff has been overcharged. This, in my view, outweighs consideration of the delay. I am also not satisfied that extending time would cause prejudice to the practitioner, or that the practitioner has good reason for opposing this application.
For these reasons, I indicated I would make the orders sought by the plaintiff. I will hear the parties as to costs.