Marlinspike Debt Acquisitions Pty Ltd v The Undone Pty Ltd (No. 2)

[2018] NSWSC 72

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Marlinspike Debt Acquisitions Pty Ltd v The Undone Pty Ltd (No. 2) [2018] NSWSC 72

Hearing dates:

31 January 2018

Date of orders:

09 February 2018

Decision date:

09 February 2018

Jurisdiction:

Common Law

Before:

Davies J

Decision:

(1)   Refuse application for recusal.

 

(2)   Refuse leave to Robert Lyndon Sayer-Jones to be released from the undertaking given by him on 9 January 2018 to be personally liable for costs ordered to be paid to the defendants.

 

(3)   Vary order 2 made by me on 12 January 2018 to provide that the plaintiff and Robert Lyndon Sayer-Jones are to pay the defendants’ costs of the summons assessed in the sum of $7,000.

 

(4)   Vary order 4 made by me on 12 January 2018 to provide that the plaintiff and Robert Lyndon Sayer-Jones are to pay 90% of the defendants’ costs of the notice of motion filed 3 January 2018, such 90% being assessed in the sum of $13,400.

 

(5)   Order the plaintiff and Robert Lyndon Sayer-Jones to pay the defendants’ costs of the notice of motion filed 24 January 2018 assessed in the sum of $15,000.

 

(6)   Stay execution of orders (3), (4) and (5) until 19 February 2018.

 (7)   Liberty to apply.

Catchwords:

PROCEDURE – courts and judges generally – judges – disqualification for bias – whether reasonable apprehension of bias – judge was a member of Legal Profession Admission Board that excluded party from Board’s legal course – application to recuse made after judgment given in principal proceedings and orders for costs made – successful party subsequently seeking specified gross sum costs order – no issue of credibility – recusal refused

 

PROCEDURE – costs – maximum costs orders and capped costs – whether a gross sums costs order should be made – non-complex administrative law proceedings involving small sum claimed in Local Court – unrepresented party against whom cost orders made – likelihood of lengthy and protracted costs assessment – relevance of the manner in which the party conducted the proceedings – proportionality of costs

PROCEDURE – application by party for release from undertaking as to costs – undertaking given to enable director to appear for plaintiff company – UCPR r 7.1 – where no change in circumstances from time of giving undertaking – whether interests of justice required release – whether party understood basis of undertaking

Legislation Cited:

Civil Procedure Act 2005 (NSW)
Supreme Court Rules 1970 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

Abalos v Australian Postal Commission (1990) 171 CLR 167; [1990] HCA 47
Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170; [1981] HCA 39
Australasian Performing Rights Association Limited v Marlin [1999] FCA 1006
Australian National Industries Ltd v Spedley Securities Ltd (In Liq) (1992) 26 NSWLR 411
Chaina v Presbyterian Church (NSW) Property Trust (No. 26) [2014] NSWSC 1009
Devries v Australian National Railways Commission (1993) 177 CLR 472; [2993] HCA 78
Dickens v State of New South Wales [2018] NSWSC 14
Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337; [2000] HCA 63
Fox v Percy (2003) 214 CLR 118; [2003] HCA 22
Hamod v State of New South Wales [2011] NSWCA 375
Harrison v Schipp [2002] NSWCA 213; (2002) 54 NSWLR 738
Helow v Secretary of State for the Home Department [2008] 1 WLR 2416
Isbester v Knox City Council [2015] HCA 20; (2015) 89 ALJR 609
Keen v Telstra Corporation Limited (No 2) [2006] FCA 930
Marlinspike Debt Acquisitions Pty Ltd v The Undone Pty Ltd [2018] NSWSC 4
Michael Wilson & Partners Limited v Nicholls (2011) 244 CLR 427; [2011] HCA 48
Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507; [2001] HCA 17
Northern Rivers FM Radio Limited v Australian Broadcasting Tribunal (1990) 25 FCR 266
Re iNova Pharmaceuticals (Australia) Pty Ltd and Secretary, Department of Health and Ageing [2011] AATA 196; (2011) 54 AAR 498
Shaoyong (David) Guo v Xinwei Song [2018] NSWSC 12
Tanamerah Estates Pty Ltd as the trustee for Alexander Superannuation Fund v Tibra Capital Pty Ltd [2013] NSWCA 266
Zepinic v Chateau Constructions (Aust) Ltd (No 2) [2014] NSWCA 99

Texts Cited:

Ritchie's Uniform Civil Procedure NSW, LexisNexis, Sydney 2005

Category:

Costs

Parties:

Marlinspike Debt Acquisitions Pty Ltd (Plaintiff)
The Undone Pty Ltd (First Defendant)
RJC Carriage 2 Pty Ltd (Second Defendant)
Georgia Maree Martin (Third Defendant)
Richard James Crampton (Fourth Defendant)
Sara Donaldson (Fifth Defendant)

Representation:

Counsel:
Robert Sayer-Jones (in his personal capacity)
C Tam (Defendants)

  Solicitors:
Self-represented (Plaintiff)
Resolve Litigation Lawyers Pty Ltd (Defendants)

File Number(s):

2017/383564

Publication restriction:

Nil

Judgment

1. I gave judgment in this matter on 12 January 2018: Marlinspike Debt Acquisitions Pty Ltd v The Undone Pty Ltd [2018] NSWSC 4. I relevantly ordered that the plaintiff and Robert Lyndon Sayer-Jones were to pay the defendants’ costs of the summons and pay 90% of the defendants’ costs of a notice of motion filed by the defendants.

2. Mr Tam of counsel for the defendants made an immediate application that costs be ordered on a gross sum basis. No notice of motion in that regard had been filed or served. Mr Tam submitted that there was an urgency about the matter because the plaintiff had served statutory demands on the two corporate defendants.

3. I declined to deal with the matter immediately and directed that the defendants were to file a notice of motion seeking a specified gross sum costs order which would be returnable for hearing on 31 January 2018. That day was said to be convenient to both the defendants and to Mr Sayer-Jones. Accordingly, the defendants filed a notice of motion on 24 January 2018 seeking orders that the plaintiff and Robert Lyndon Sayer-Jones pay the defendants the sum of $22,581.85 on account of the costs order made by me and an amount of $17,601.94 in respect of the notice of motion seeking the gross sum costs order. The motion also sought an order that the liability of the plaintiff and Robert Lyndon Sayer-Jones be joint and several.

4. The motion came on for hearing before me on 31 January 2018. At the outset Mr Sayer-Jones informed me that he was appearing only for himself in respect of the orders sought against him personally, and not on behalf of the plaintiff because he was no longer a director or shareholder of that company. He then made an application that I should disqualify myself on the basis of apprehended bias. The apprehension was said to arise from the fact that in 2014 I was a member of the Legal Profession Admission Board when that Board expelled Mr Sayer-Jones from the Admission Board’s legal study course. At the conclusion of submissions made by both parties concerning that application I said that I declined to recuse myself and that I would provide my reasons in the judgment concerning the defendants’ notice of motion.

5. Mr Sayer-Jones then made a further application, that the hearing of the motion be adjourned for a period of two to three months because of a police investigation that was apparently being conducted into the circumstances of the commencement of the Local Court proceedings that were the subject of my earlier judgment. The basis for the adjournment application was an apprehension by Mr Sayer-Jones that he might be incriminating himself if he gave any evidence at the hearing of the defendants’ notice of motion. Submissions were then made by Mr Sayer-Jones in support of that application. However, before any ruling could be given on it by me Mr Sayer-Jones withdrew the application.

6. I then proceed to hear the defendants’ motion. During that hearing Mr Sayer-Jones made an application that he be given leave to withdraw his undertaking to pay any costs ordered in favour of the defendants. Two reasons were put forward in support of that application. The first was that the decision in Tanamerah Estates Pty Ltd as the trustee for Alexander Superannuation Fund v Tibra Capital Pty Ltd [2013] NSWCA 266 was wrongly decided. The second reason was that Mr Sayer-Jones said that he understood the costs he undertook to pay were the costs only of the summons and not the costs of the defendants’ notice of motion.

7. The defendants read three affidavits being the affidavits of Nicola Kaethe Nygh sworn 24 January 2018, and two affidavits of Samuel Bruce Wheeler sworn 24 and 30 January 2018 respectively.

8. Mr Sayer-Jones sought to cross-examine Ms Nygh. I gave leave to him to do so, having ascertained the scope of the matters he wished to ask, bearing in mind that this was an interlocutory application. It became necessary for me to disallow a number of questions sought to be asked by Mr Sayer-Jones when repetitive questions were asked, and when questions were asked which were not relevant to the issues to be determined on the notice of motion.

9. Mr Sayer-Jones also sought to cross-examine Mr Wheeler. When I asked Mr Sayer-Jones to identify the matters generally about which he intended to cross-examine Mr Wheeler he indicated the following:

A refusal to engage by telephone correspondence; the delays in receiving a response in my emails; his wholesale failure to properly understand the claim; his complete inability to the reduce his client's legal costs; the oppressive nature of the notice to produce; the fact that it was never acted upon because the notice to produce was actually never requested; the fact that Mr Wheeler has actually no experience in litigation of any kind apart from this matter and that he was totally ill equipped to deal with it.

I formed the view that the Court’s resolution of the issues between the parties on the defendants’ notice of motion would not be assisted by such cross-examination. Accordingly, I refused him leave to cross-examine Mr Wheeler.

10. It is necessary to add that Mr Wheeler’s affidavits went no further than annexing voluminous email correspondence between Mr Sayer-Jones and the defendants’ solicitors, Resolve Litigation Lawyers, amongst which were emails Mr Sayer-Jones had on several occasions sent to my Associate. With a few exceptions to be discussed presently, I have had little regard to the content of most of those emails because the content of them did not generally deal with the issues to be determined on the defendants’ notice of motion. However, the emails were relevant to the extent of the costs charged to the defendants by Resolve, insofar as the solicitors needed to read, and in many cases respond to, those emails.

11. Ms Nygh was called by the defendants as an expert witness in relation to the reasonableness of the charges made by the defendants’ solicitors. She was admitted as a solicitor in June 1991. She commenced practice as a lawyer with Allen, Allen & Helmsley (now Allens) in 1992 where she remained until 2015. At Allens she practised in commercial litigation and dispute resolution. In 2015 she became Special Counsel at Resolve.

12. Ms Nygh was one of the solicitors at Resolve who dealt with the claim made by the plaintiff. Her involvement concerned advising on and preparing evidence in support of the present application for a gross sum costs order. Mr Michael Daniel, a director of Resolve, and Mr Samuel Wheeler, who was initially a law graduate and subsequently a solicitor from 1 January 2018, were the two solicitors in the firm who were acting in the Local Court proceedings and in respect of the proceedings generally in this Court.

13. Ms Nygh’s affidavit discloses that Resolve issued three invoices to the defendants. The first was dated 20 December 2017 totalling $7,145. However, the only work claimed for the Supreme Court proceedings in relation to that invoice was an amount of $276.

14. The second invoice was issued on 11 January 2018 for professional costs and disbursements totalling $26,227.08 (the First January Invoice). That invoice was for work performed between 20 December 2017 and 9 January 2018.

15. The third invoice was dated 23 January 2018 for professional costs and disbursements totalling $20,099.92 (the Second January Invoice). That invoice was for work performed between 10 and 22 January 2018.

16. Ms Nygh, having conferred with Mr Wheeler, the solicitor responsible for the day to day carriage of the matter, estimated that costs and disbursements in relation to the summons were as follows:

$6,552 for professional fees;

$3,271.67 for   counsel’s fees; and

$62.18 for disbursements.

The professional fees and disbursements were derived from all three invoices.

17. She estimated 90% of the defendants’ costs of the motion filed 3 January 2018 as follows:

$12,877.20 professional fees;

$5,464.50 for counsel’s fees; and

$830.70 for disbursements.

These figures were derived from the First January Invoice and the Second January Invoice.

18. She estimated the defendants’ costs for the present application for a gross sum costs orders as follows:

$17,196 professional fees;

$4,706.67 for counsel’s fees; and

$1,431.27 for disbursements.

All of these monies were contained in the Second January Invoice.

19. Ms Nygh also estimated the defendants’ cost in respect of the present application, not then invoiced, as follows:

$1,960 professional fees;

$520 for counsel’s fees; and

$923 for disbursements (being the filing fee for the notice of motion).

20. Ms Nygh identified the relevant charge-out rates for those solicitors involved in the matter as follows:

Michael Daniel and Nicola Nygh $590 per hour.

Samuel Wheeler $250 per hour until 31 December 2017 and thereafter $260 per hour.

She also identified a third solicitor, Ms Dela Cruz, but her involvement appears only to be taking the oaths of Ms Nygh and Mr Wheeler in respect of their affidavits.

21. Ms Nygh said that, based on her experience and observations, the professional work charged in the invoices was reasonable and that the hourly rates of charging were at or below the market rates for practitioners of similar seniority and experience. In addition, they were within the hourly rates of the Costs Assessment Rules Committee, Guideline, Costs Payable between Parties under Court Orders.

22. Ms Nygh noted that the likely recovery at any costs assessment (i.e., the amount payable for party-party costs as opposed to indemnity costs) was approximately two thirds of the fees charges and 100% of disbursements including counsel’s fees. Based on her assessments and the discount referred to, Ms Nygh estimated that on a costs assessment the defendants would recover $7,701.85 in connection with the summons costs order, $14,880 in connection with the motion costs order and $17,601.94 in connection with the present application.

23. As I noted earlier, Mr Wheeler’s affidavits read on this motion only annexed email correspondence passing between his firm and Mr Sayer-Jones. His affidavit of 24 January 2018 disclosed 86 pages of such emails between 9 and 24 January and his affidavit of 30 January disclosed 44 pages of such emails between 24 and 30 January. It may be noted that some emails were duplicated by reason of the email chains. However, those figures do not include many more emails sent by Mr Sayer-Jones prior to the hearing of the principal proceedings. Those are to be found in Mr Wheeler’s affidavit sworn 8 January 2018 read at the hearing of the principal proceedings.

24. At the conclusion of the evidence, Mr Tam of counsel made submissions on behalf of the defendants. Thereafter Mr Sayer-Jones addressed me briefly but then sought leave to put in further written submissions on the issue of whether a gross sum costs order should be made. In the circumstances, I gave leave for Mr Sayer-Jones to lodge any further written submissions within seven days.

25. On 5 February 2018 Mr Sayer-Jones emailed what were entitled “Written Submissions on Gross Sum Costs Order” but which included further submissions on the issues of apprehended bias and a release from his undertaking, in respect of neither of which had leave been given. Nevertheless, and being conscious of possible unfairness to the defendants in that regard, I have considered all of those further submissions.

26. The three issues for determination are these:

(1)   Whether I should recuse myself;

(2)   Whether Mr Sayer-Jones should be given leave to withdraw his undertaking to pay costs personally; and

(3)   Whether a gross sum costs order should be made in the defendants’ favour and, if so, in what amounts.

(1)   Apprehended bias

27. I should first note the following about which I informed Mr Sayer-Jones at the hearing. I sat on the Legal Profession Admission Board from 2010 until the end of 2016. When the present case first came to my attention as the Vacation Judge in January the name “Sayer-Jones” rang a vague bell with me. I could not pinpoint why it was familiar.

28. At the hearing, Mr Sayer-Jones reminded me that the question of his exclusion from the Board’s law course arose for consideration by the Board in 2014. A sub-committee was appointed by the Board comprising Justice Lindsay, Ms Margaret Allars SC and the Dean of Law at the University of Western Sydney to conduct a hearing into the matter. The sub-committee reported to the Board and recommended Mr Sayer-Jones’ exclusion from the course. The Board adopted that recommendation and resolved to exclude him. Mr Sayer-Jones did not remind me of what he was alleged or found to have done that led to that exclusion. As I said to Mr Sayer-Jones, I cannot remember to the present time what the basis for the exclusion was. In the seven years I served on the Board, the Board had to consider hundreds of matters involving admission to practice where offences and plagiarism were involved, exemptions to course requirements for applicants, and whether students should be excluded from the Board’s course.

29. I accept, nevertheless, that the fact that I cannot remember that basis or the details of the matters discussed by the Board cannot of itself mean that I am not bound to consider whether I should recuse myself nor would that lack of memory be a reason for not recusing myself if otherwise it was appropriate to do so.

30. Mr Sayer-Jones submitted that, since I was a member of the Board that excluded him and his credit was now in issue, a fair-minded and reasonably well informed observer might conclude that I might not approach the determination of the present matter with an open mind. No application had been made by Mr Sayer-Jones to recuse myself before I heard or delivered judgment on the substantive issue in the present proceedings.

31. In Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337; [2000] HCA 63 the judgment of Gleeson CJ, McHugh, Gummow and Hayne JJ said at [6]:

… a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide.

The judgment went on to say at [7]:

The question is one of possibility (real and not remote), not probability.

32. In Helow v Secretary of State for the Home Department [2008] 1 WLR 2416 Lord Hope of Craighead said at [2]-[3]:

The observer who is fair-minded is the sort of person who always reserves judgment on every point until she has seen and fully understood both sides of the argument. She is not unduly sensitive or suspicious. ... Her approach must not be confused with that of the person who has brought the complaint. ... The assumptions that the complainer makes are not to be attributed to the observer unless they can be justified objectively. But she is not complacent either. She knows that fairness requires that a judge must be, and must be seen to be, unbiased. She knows that judges, like anybody else, have their weaknesses. ...

Then there is the attribute that the observer is "informed". It makes the point that, before she takes a balanced approach to any information she is given, she will take the trouble to inform herself on all matters that are relevant. She is the sort of person who takes the trouble to read the text of an article as well as the headlines. She is able to put whatever she had read or seen into its overall social, political or geographical context. She is fair-minded, so she will appreciate that the context forms an important part of the material which she must consider before passing judgment.

33. In Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507; [2001] HCA 17 Hayne J said at [185]:

Saying that a decision-maker has prejudged or will prejudge an issue, or even saying that there is a real likelihood that a reasonable observer might reach that conclusion, is to make a statement which has several distinct elements at its roots. First, there is the contention that the decision-maker has an opinion on a relevant aspect of the matter in issue in the particular case. Secondly, there is the contention that the decision-maker will apply that opinion to that matter in issue. Thirdly, there is the contention that the decision-maker will do so without giving the matter fresh consideration in the light of whatever may be the facts and arguments relevant to the particular case. Most importantly, there is the assumption that the question which is said to have been prejudged is one which should be considered afresh in relation to the particular case.

34. In Isbester v Knox City Council [2015] HCA 20; (2015) 89 ALJR 609 Gageler J said at [59] that the test for apprehended bias in the curial context necessarily involved three analytical steps. He went on to say:

Step one is identification of the factor which it is hypothesised might cause a question to be resolved otherwise than as the result of a neutral evaluation of the merits. Step two is articulation of how the identified factor might cause that deviation from a neutral evaluation of the merits. Step three is consideration of the reasonableness of the apprehension of that deviation being caused by that factor in that way.

35. Counsel for the defendants submitted that whichever three steps are taken (if there is any difference between them) none of the steps has been articulated in relation to the present case. However, if regard is had to the three steps identified by Gageler J in Isbester, the identification of step one, as Mr Sayer-Jones submitted, is that I was member of the Legal Profession Admission Board when a decision was taken to exclude Mr Sayer-Jones from the Board’s legal course. Expressing the matter as Hayne J does, it would be necessary to point to a reasonably held apprehension that I had an opinion about Mr Sayer-Jones that was adverse to him because of the Board’s decision.

36. Even if a fair-minded observer might hold such an apprehension, Mr Sayer-Jones runs into difficulties at the second and third steps. He submitted that the identification of the second factor is that he knows that I am aware that, being a member of the Board, I was “instrumental in the student’s expulsion for reasons that are equivalent to striking someone off the Roll”. However, I do not consider that that is an appropriate articulation of step two. Whether that step is described as the factor that “might cause that deviation from a neutral evaluation of the merits” (Gageler J), or as the applying of the opinion I had of Mr Sayer-Jones from the exclusion decision to the issue here to be determined (Hayne J), it is not shown how the exclusion decision will influence the outcome of the present motion in the consideration of which no issue of Mr Sayer-Jones’ credit arises. Findings that go to the credibility of witnesses may be of particular significance when considering the view the fair-minded lay observer might form: Re iNova Pharmaceuticals (Australia) Pty Ltd and Secretary, Department of Health and Ageing [2011] AATA 196; (2011) 54 AAR 498 at [17]-[18]; Northern Rivers FM Radio Limited v Australian Broadcasting Tribunal (1990) 25 FCR 266 at 273.

37. In Michael Wilson & Partners Limited v Nicholls (2011) 244 CLR 427; [2011] HCA 48 the joint judgment of Gummow A-CJ, Hayne, Crennan and Bell JJ said at [69]:

Here, however, it was said that "the fact that one party appeared before the judge on seven separate days in closed court raised a different and additional concern". That concern was identified as the possibility "in such circumstances that the judge's mind will become familiar with the character of the plaintiff's case to an extent that, consciously or subconsciously, there will be a tendency to place the further evidence within the pre-existing mental structure" (emphasis added). But the existence of a "concern" described as the possibility of placing the evidence led at trial into a "pre-existing mental structure" does not demonstrate that the fair-minded lay observer might reasonably apprehend that the judge might have prejudged an issue to be decided at trial. In order to establish such a reasonable apprehension it is necessary to analyse more closely the connection that is asserted between the conduct and disposition of interlocutory applications and the possibility of prejudgment.

38. That is what is, in substance, asserted in this case – that I have a disposition or a pre-existing mental structure which is adverse to Mr Sayer-Jones from the Board’s decision which means that I have prejudged the issue now to be determined, namely, whether a gross sum costs order should be made and not, it should noted, an order whether or not Mr Sayer-Jones should pay costs. That has already been determined, and that is not challenged. Such a concern does not demonstrate that the fair-minded lay observer might reasonably apprehend that I might prejudge the issue I now have to determine.

39. Mr Sayer-Jones correctly identified that some of the material contained in the emails attached to Mr Wheeler’s affidavit asserted a peripheral wrongdoing on his part. I say “peripheral” because it concerned the change of shareholding and directorship in the plaintiff after my first judgment. However, the defendants indicated that they did not tender the particular emails contained in paragraphs 83-96 of Mr Wheeler’s affidavit of 24 January 2018 and they did not rely on concomitant paragraphs in their written submissions, being paragraph 20 and the second sentence of paragraph 22.

40. Accordingly, in the material in evidence before me, no issue of credit is involved in the decision making. The issue is simply whether the costs orders I had previously made should be varied so that instead of those costs being agreed or assessed in the ordinary course they should effectively be assessed by me as a gross sum costs order. A determination of that matter is based on legal principles which have been identified in a number of cases that are collected in Hamod v State of New South Wales [2011] NSWCA 375 and Zepinic v Chateau Constructions (Aust) Ltd (No 2) [2014] NSWCA 99.

41. As Lord Hope said in Helow, the fair-minded observer is not unduly sensitive or suspicious; before she takes a balanced approach to any information she is given she will take the trouble to inform herself on all matters that are relevant; and she is able to put whatever she had read or seen into its overall social, political or geographical context.

42. My statement of the legal principles concerning gross sums costs orders and my application of them to the facts will either be correct or incorrect when judged objectively, and will be subject to consideration on an appeal which does not defer to any advantage I have as a primary judge: cf. Abalos v Australian Postal Commission (1990) 171 CLR 167; [1990] HCA 47; Devries v Australian National Railways Commission (1993) 177 CLR 472; [1993] HCA 78Fox v Percy (2003) 214 CLR 118; [2003] HCA 22.

43. Accordingly, having regard to Gageler J’s third step, the approach required to determine the present motion means that any apprehension of a deviation from a neutral evaluation cannot be considered reasonable. Similarly, with regards to Hayne J’s third step, it is difficult to see how an apprehension that I would not consider the present matter afresh or in accordance with the proper principles (on the assumption of an adverse view of Mr Sayer-Jones) could be reasonable. Viewed in the way referred to in Michael Wilson, any connection between the decision to exclude Mr Sayer-Jones by the Board and the possibility of pre-judgment must be regarded as tenuous.

44. Mr Sayer-Jones relied on Australian National Industries Ltd v Spedley Securities Ltd (In Liq) (1992) 26 NSWLR 411. However, that decision is distinguishable as the following passage of Mahoney JA’s judgment (Meagher JA agreeing) (at 442) makes clear:

But the court has, in my respectful opinion correctly, indicated that a previous decision of the same fact or upon the credibility of a relevant witness will create such an apprehension, normally if not inevitably. The effect of the decisions is, in my opinion, to indicate the effect of such a decision in the assessment of the apprehension of partiality by the ordinary person. In the present case, the matters upon which decisions have been or will be made are not merely peripheral: they are at the heart of what, in the subsequent cases, the court will be required to determine. The solvency of Spedley at a particular time or times will not be merely circumstantial evidence: it will be part of the very claim or cause of action itself. The credibility of, for example, Mr Yuill and Mr Maher will not be peripheral or incidental. As I understand the matter as it has been placed before this Court, the evidence of the witnesses in question will directly determine or directly bear upon the existence of facts central to the claims to be decided. Accordingly, in my opinion, the fact that such matters have been decided in earlier cases will be of particular significance. If prior decisions of fact or credibility are to be seen as of such importance in creating the apprehension on which the principle is based, these prior decisions are decisions on matters which, being at the heart of the issues, must have particular force in creating such an apprehension.

45. In those circumstances, I do not consider that a fair-minded observer might consider that a decision based on legal principles on how costs already ordered should be assessed might not be the decision of an impartial mind.

46. There is a further, although subsidiary, consideration. No application was made by Mr Sayer-Jones for me to recuse myself until after I had delivered judgment in the principal proceedings, and then only for the present motion. Although I dealt with costs in those proceedings, the present application is one simply in effect to vary those costs orders by providing for payment on a gross sum basis. Whilst I accept that it would not be impossible for another judge to consider the present issue, some weight needs to be given to the ordinary arrangement that the judicial officer who decides the principal issue also determines the question of costs, a fortiori, where the costs order has been made and the issue is only how it is assessed.

47. For these reasons, I do not consider that I should recuse myself from hearing the present application.

(2)   Application to withdraw the undertaking

48. In my earlier judgment I set out at [67]-[70] the circumstances in which Mr Sayer-Jones came to give the undertaking to be personally responsible for any costs ordered in favour of the defendants against the plaintiff. In the light of a submission made by Mr Sayer-Jones (noted at [6] above), the following should be added to explain the circumstances of the giving of the undertaking more completely.

49. As I noted in my earlier judgment at [21], the matter came before me on 9 January 2018 initially to hear the defendants’ notice of motion filed 3 January 2018. When Mr Sayer-Jones sought to appear for the plaintiff I asked him why he should be given leave to appear in light of the way the proceedings were constituted and the Court of Appeal’s decision in Tanamerah Estates. I gave a copy of that decision to each of the parties and adjourned to give them time to read it. Subsequent to the adjournment I asked Mr Sayer-Jones to tell me what cause of action he personally had against the defendants. When he was not able to do so the following exchange occurred.

HIS HONOUR: … Now, one way around the problem is, of course, if you are prepared to give a personal undertaking to pay any costs incurred by the other side if costs are ordered in their favour, but (sic) then I would be prepared to consider allowing the matter to proceed with you representing the company.

SAYER JONES: Absolutely right now I make that undertaking.

HIS HONOUR: That is an undertaking to the Court, you understand

SAYER JONES: Absolutely.

HIS HONOUR: so a breach of it would amount to contempt.

SAYER JONES: Absolutely, I make that undertaking.

HIS HONOUR: Yes, all right.

SAYER JONES: But I would still like to prepare written submissions and immerse myself in the law regarding this area.

HIS HONOUR: That is entirely a matter for you.

SAYER JONES: May I (sic) please the Court.

HIS HONOUR: Mr Tam, it is your motion that is listed today apart from the proceedings having been stood over to today.

TAM: Yes. I should read my material then in that case, your Honour, the notice of motion and also three affidavits which perhaps have made their way to the Court file filed 3 January, the first affidavit of Mr Richard Crampton, the affidavit of Ms Sarah Donaldson, the affidavit of Ms Georgia Martin and the affidavit of my instructing solicitor, Mr Wheeler, filed yesterday, 8 January.

50. Mr Tam then read the affidavits in support of the notice of motion that he relied upon. There was then argument about whether Mr Sayer-Jones should be permitted to cross-examine the deponents of the affidavits. After some debate, Mr Sayer-Jones said that he did not have any need to cross-examine the deponents and that he did not object to anything in the affidavits.

51. The following exchange then occurred:

HIS HONOUR: … Mr Sayer Jones, it seems to me on the basis of what has transpired in this matter already and the defendants' notice of motion that there are two matters I have to decide today. The first is whether I should, in effect, dismiss the Local Court proceedings as the defendants ask.

Secondly, if I don't think that I have the power to or I should not dismiss those proceedings, the question still remains whether the stay that Justice Rothman imposed, which expires tomorrow, should be re imposed or allowed to lapse.

SAYER JONES: If I could say three things about that. Firstly, there is no summons seeking to quash the Local Court orders and in my respectful submission

HIS HONOUR: I don't want you to argue the substantive points. I am just asking do you agree those are the two matters I would have to decide?

SAYER JONES: The third matter that your Honour would need to decide, and it is actually quite unclear what the defendants' position on this matter is, is whether the decision of the Local Court was in fact lawful

52. Thereafter Mr Tam submitted that the most expeditious course would be for me to determine all issues on that day. The following exchange then occurred:

HIS HONOUR: Mr Sayer Jones, are you in a position to argue the appeal today?

SAYER JONES: I am but I would like maybe 20 minutes to gather my thoughts but absolutely I was given the defendants' submissions last night. I would obviously like to put something in writing to assist your Honour, as any litigant is obligated to provide the maximum level of assistance.

I do not accept much of what was said in the defendants' submissions because there is an eliding of the procedural claims and the substantive claim. If I was successful in this appeal the default judgment would be reinstated; the matter would then return to the Local Court and then The Undone parties and myself could have a major factual dispute about service and so forth. We submit it is not appropriate that this Court enter into the fray in that respect.

HIS HONOUR: I agree with you. But it is not for me to determine whether they were served in the Local Court or not. The issue is whether the judgment in the Local Court was properly set aside.

SAYER JONES: Absolutely. I can argue that now.

HIS HONOUR: There seems some benefit for that. Otherwise we will be having argument about one aspect of the matter today and then another day there will be argument about the appeal and extra costs are involved in all of that.

If the parties want me to determine the success or otherwise of the plaintiff's appeal to this Court or the seeking of prerogative relief, using the terms generally, then I am prepared to do that. But if you need 20 minutes, Mr Sayer Jones, I will give you that.

SAYER JONES: I can do that now. It is quite straightforward, we submit. Just if your Honour could bear with me, I have prepared documents here so I can make sure this is intelligent for your Honour.

53. As indicated earlier, the two bases on which Mr Sayer-Jones said in oral submissions that he should have leave to withdraw his undertaking were: first, that the Court of Appeal’s decision in Tanamerah Estates was wrongly decided; and secondly, that he did not understand that he was undertaking to pay the defendants’ costs on their notice of motion in contradistinction to the costs of the summons. However, in his written submissions he put forward five reasons as follows:

(a)   He had not (sic) time to relevantly process the nature of the undertaking.

(b)   He never actually signed the undertaking and made it in open Court.

(c)   He had not given the matter calm reflection which such a serious financial decision requires and the defendants had pushed him into a corner.

(d)   The undertaking was sought by the defendants where the defendant (sic) was lulled into a forensic trap because he had no understanding of the costs order.

(e)   The defendants showed a total lack of forensic skill in not pursuing a security costs application (sic) against Marlinspike. It may have been successful.

54. Mr Sayer-Jones accepted that I was bound to follow Tanamerah Estates but said that he wished to make the submission that Tanamerah Estates was wrongly decided so that he would be able to argue that proposition on any appeal from my judgment.

55. The question for me to consider, therefore, on Mr Sayer-Jones’ application is whether he provided the undertaking on a misunderstanding and under pressure, and to consider it based on the principles relating to releasing a party from his or her undertaking.

56. It should first be noted that paragraphs (c), (d) and (e) (above) appear to be based on a misconception by Mr Sayer-Jones that the defendants sought the undertaking. They did not, as the transcript (set out at [49] above) makes clear. In commencing the proceedings and seeking to appear on the Plaintiff company’s behalf, Mr Sayer-Jones was obliged to comply with the Rules and, in particular, r 7.1(3) which is expressed in mandatory terms. What that rule required was clarified in Tanamerah Estates, a decision that bound me.

57. To avoid the result that the Plaintiff’s proceedings would be stymied entirely, or would have needed to be adjourned so that, in some fashion, they could proceed in compliance with r 7.1 generally, I offered Mr Sayer-Jones the opportunity to proceed if he was prepared to give such an undertaking. That course seemed to me to be entirely consistent with the Court of Appeal’s view of r 7.1 in Tanamerah Estates, particularly at [16] and [21]. As the transcript discloses, the defendants did not have any input into the matter. At this remove, and after reflection, I should probably have sought such input, but the defendants have made no complaint about that.

58. As to (a) and (c) above, Mr Sayer-Jones provided the undertaking without hesitation, and without any request to consider the matter. His stated desire after giving the undertaking to prepare written submissions was not sought on the basis of any adjournment being given to do so before the matter proceeded.

59. Paragraph (b) of Mr Sayer-Jones’ submission is not understood. Such an undertaking to the court would not ordinarily be given in writing.

60. In Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170; [1981] HCA 39 the High Court held at pp 177-178 that a court has the power to release a party from an undertaking in the absence of consent of the other party, and that one basis for doing so would be if new facts had come into existence or were discovered which rendered the enforcement of the undertaking unjust.

54. In Shaoyong (David) Guo v Xinwei Song [2018] NSWSC 12 Black J said at [58]:

The overriding principle, in considering whether a party should be released from an undertaking, is that the Court “should do whatever is in the interests of justice having regard to the particular circumstances of the case”: Just Group Ltd v Peck [2016] VSC 614 at [88]; see also Create Business Australia Pty Ltd v AURFS Pty Ltd [2017] NSWSC 680 at [24]–[26]. …

62. Mr Sayer-Jones does not point to any change in the circumstances since he gave the undertaking nor does he show how the interests of justice are not maintained if he is held to that undertaking. Moreover, as the transcript clearly shows, at the time Mr Sayer-Jones gave the undertaking the only matter then in consideration was the defendants’ notice of motion. In any event, if, as he says, Mr Sayer-Jones believed that he was giving an undertaking personally to pay the costs associated with the summons, a determination of the proceedings generally occasioned by the filing of the summons involved a determination of other interlocutory applications such as the defendants’ notice of motion to dismiss the summons.

63. As I noted in my earlier judgment at [69], the Court of Appeal in Tanamerah Estates said that the requirement in r 7.1(3) Uniform Civil Procedure Rules 2005 (NSW) provides a degree of protection to a defendant against incurring legal costs which may be irrecoverable from the corporate plaintiff. The matter is particularly highlighted in the present case where there have been two changes (once after the plaintiff obtained ex parte orders from Rothman J and once after my judgment of 12 January 2018) in relation to the shareholding and directorships of the plaintiff, with the result that the plaintiff is, as Mr Sayer-Jones acknowledges, without assets to pay the costs order against it, and he no longer controls the plaintiff.

64. Leave to release Mr Sayer-Jones from the undertaking given on 9 January 2018 should be refused.

(3)   Should a gross sum costs order be made?

65. Section 98 of the Civil Procedure Act 2005 (NSW) relevantly provides:

98 Courts powers as to costs

(1) Subject to rules of court and to this or any other Act:

(a) costs are in the discretion of the court, and

(b) the court has full power to determine by whom, to whom and to what extent costs are to be paid, and

(c) the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis.

…

(3) An order as to costs may be made by the court at any stage of the proceedings or after the conclusion of the proceedings.

(4) In particular, at any time before costs are referred for assessment, the court may make an order to the effect that the party to whom costs are to be paid is to be entitled to:

(a) costs up to, or from, a specified stage of the proceedings, or

(b) a specified proportion of the assessed costs, or

(c) a specified gross sum instead of assessed costs, or

(d) such proportion of the assessed costs as does not exceed a specified amount.

…

66. In Harrison v Schipp [2002] NSWCA 213; (2002) 54 NSWLR 738 Giles JA said of the earlier equivalent provision to s 98(4) (Pt 52A r 6(2) Supreme Court Rules 1970 (NSW)):

[21] The power conferred by r 6(2) is not confined, and may be exercised whenever the circumstances warrant its exercise. It may appropriately be exercised where the assessment of costs would be protracted and expensive, and in particular if it appears that the party obliged to pay the costs would not be able to meet a liability of the order likely to result from the assessment (Leary v Leary (1987) 1 WLR 72; Sparnon v Apand Pty Ltd (von Doussa J, 4 March 1998, unreported); Beach Petroleum NL v Johnson (1995) 57 FCR 119; Hadid v Lenfest Communications Inc [2000] FCA 628).

[22]   Of its nature, specification of a gross sum is not the result of a process of taxation or assessment of costs. As was said in Beach Petroleum NL v Johnson at 124, the gross sum “can only be fixed broadly having regard to the information before the Court”; in Hadid v Lenfest Communications Inc at [35] it was said that the evidence enabled fixing a gross sum “only if I apply a much broader brush than would be applied on taxation, but that … is what the rule contemplates”. The approach taken to estimate costs must be logical, fair and reasonable (Beach Petroleum NL v Johnson at 123; Hadid v Lenfest Communications Inc at [27]). The power should only be exercised when the Court considers that it can do so fairly between the parties, and that includes sufficient confidence in arriving at an appropriate sum on the materials available (Wentworth v Wentworth (CA, 21 February 1996, unreported, per Clarke JA).

67. In Hamod v State of New South Wales Beazley JA (with whom Giles and Whealey JJA agreed) said:

[813] I have already set out the relevant provisions of s 98. The discretion thereby conferred upon the court is not confined and may be exercised whenever the circumstances warrant its exercise, having regard to the scope and purpose of the provision: Harrison & Anor v Schipp [2002] NSWCA 213; 54 NSWLR 738 per Giles JA at [21]-[22]. In Harrison v Schipp, Giles JA considered that the discretion in s 98(4) may be exercised where the assessment of costs would be protracted and expensive and, in particular, if it appeared that a party obliged to pay the costs would not be able to meet a liability of the order likely to result from the assessment. However, his Honour stated, at [22]:

"The power should only be exercised when the Court considers that it can do so fairly between the parties, and that includes sufficient confidence in arriving at an appropriate sum on the materials available."

[814]   See also Wentworth v Wentworth (Court of Appeal, 21 February 1996, unreported). The courts have typically applied a discount in assessing costs on a gross sum basis: Ritchie's Uniform Civil Procedure NSW, LexisNexis, Sydney, 2005 to date, " Civil Procedure Act ", at [s 98.65]; Charlick Trading Pty Ltd v Australian National Railways Commission [2001] FCA 629; Sony Entertainment (Aust) Ltd v Smith (2005) 215 ALR 788; Idoport Pty Ltd v National Australia Bank Ltd; Lorenzato v Lorenzato & Anor (No 2) [ 2011] NSWSC 790 per Black J.

[815]   In Beach Petroleum NL v Johnson (No 2) (1995) 57 FCR 119; 135 ALR 160, von Doussa J noted that the specified gross sum costs procedure was particularly useful in complex cases, that the power must be exercised judicially and only after giving the parties an adequate opportunity to make submissions, and that before exercising the power the court should be confident that the approach taken to estimate costs is fair, logical and reasonable.

[816] The terms of s 98(4), together with the more general considerations reflected in the Civil Procedure Act, ss 56(1), 57(1)(d) and 60, suggest the factors that merit particular consideration include: the relative responsibility of the parties for the costs incurred (for example, Harrison v Schipp); the degree of any disproportion between the issue litigated and the costs claimed; the complexity of proceedings in relation to their cost; and the capacity of the unsuccessful party to satisfy any costs liability: Ritchie's Uniform Civil Procedure NSW at [s 98.45].

[817] The exercise of the power conferred by s 98(4) is particularly appropriate where the costs have been incurred in lengthy or complex cases and it is desirable to avoid the expense, delay and aggravation likely to be involved in contested costs assessment. This may arise either from the likely length and complexity of the assessment process: Beach Petroleum NL v Johnson (No 2) at 120; Charlick Trading Pty Ltd v Australian National Railways Commission; Australasian Performing Rights Association Ltd v Marlin [1999] FCA 1006; or from the likelihood that the additional costs of formal assessment would disadvantage the successful party because of the likely inability of the unsuccessful party to discharge the costs liability in any event: Harrison v Schipp ; Sony Entertainment (Aust) Ltd v Smith (2005) 215 ALR 788 at [90], [194]-[195]; Hadid v Lenfest Communications Inc [2000] FCA 628.

[818]   The power may also be exercised where a party's conduct has unnecessarily contributed to the costs of the proceedings, especially where the costs incurred have been disproportionate to the result of the proceedings: Leary v Leary [1987] 1 WLR 72; [1987] 1 All ER 261; Sony Entertainment (Aust) Ltd v Smith; Microsoft v Jiang (2003) 58 IPR 445; [2003] FCA 101; Ritchie's Uniform Civil Procedure NSW at [s 98.60]).

[819]   The assessment of any gross sum to be awarded must represent a review of the successful party's costs by reference to the pleadings and complexity of the issues raised on the pleadings; the interlocutory processes; the preparation for final hearing and the final hearing: Smoothpool v Pickering [2001] SASC 131. In the exercise of its discretion the court is not required to undertake a detailed examination of the kind that would be appropriate to taxation or formal costs assessment: Harrison v Schipp at 743; Hadid v Lenfest Communications Inc at [35]; Auspine Ltd v Australian Newsprint Mills Ltd (1999) 93 FCR 1 at 5; [1999] FCA 673.

[820]   The costs ordered should be based on an informed assessment of the actual costs having regard to the information before the court (for example, by relying on costs estimates or bills): Beach Petroleum NL v Johnson (No 2); Leary v Leary; Harrison v Schipp at 743; Sparnon v Apand Pty Ltd (FCA, 4 March 1998, unreported) . The approach taken to estimate the costs to be ordered must be logical, fair and reasonable: Beach Petroleum NL v Johnson at 164-165; Hadid v Lenfest Communications Inc at [27]; Harrison v Schipp at 743. This may involve an impressionistic discount of the costs actually incurred or estimated, in order to take into account the contingencies that would be relevant in any formal costs assessment: Leary v Leary at WLR 76 per Purchas LJ; Beach Petroleum NL v Johnson (No 2) at 123; Auspine Ltd v Australian Newsprint Mills Ltd at 164-165.

68. A further relevant consideration is whether one party is acting for themselves: Zepinic at [29]; Chaina v Presbyterian Church (NSW) Property Trust (No. 26) [2014] NSWSC 1009 at [50].

69. The defendants submitted that a gross sum costs order was appropriate for four reasons:

(a)   a protracted and expensive costs assessment is highly likely;

(b)   the plaintiff company is one of “straw”;

(c)   the plaintiff and Mr Sayer-Jones are likely to remain self-represented; and

(d)   the plaintiff’s conduct has unnecessarily contributed to costs, and such conduct is likely to continue.

70. Mr Sayer-Jones submitted that no proper basis was shown for ordering a gross sum costs order. He submitted that he conducted the proceedings in an entirely appropriate and economical way which had the effect of minimising costs. He submitted that he should not be deprived of the right to test the fees charged by Resolve in a costs assessment. He submitted that Ms Nygh did not have the expertise to give an opinion on the reasonableness of the fees charged by Resolve. He appeared to submit in his written submissions that the extent of the email correspondence was the fault of Resolve. He submitted that there was no evidence as to whether he would be able to meet a costs assessment and pay any costs ordered.

71. In my opinion, Ms Nygh was appropriately qualified to give evidence about the reasonableness of the fees of Resolve. Although Ms Nygh had not acted in an appeal from a Local Court to the Supreme Court, I am satisfied that her experience in both administrative law matters and in commercial litigation generally provided a sufficient basis for the opinions she expressed. Further, her opinion as to the reasonableness of the hourly charging rates of the solicitors is borne out by a consideration of the Costs Assessment Rules Committee, Guideline, Costs Payable Between Parties Under Court Orders.

72. I do not consider that Resolve acted inappropriately by having a junior solicitor, Mr Wheeler, work under the supervision a senior partner, Mr Daniel. It is clear that Mr Wheeler had the day to day carriage of the matter and the costs charged to the defendants were thereby reduced because of his much lower charge-out rate.

73. Further, I am satisfied that it was not inappropriate for Resolve to brief Mr Tam as counsel in the matter. Mr Sayer-Jones’ submission, that Resolve should immediately have briefed senior counsel or a senior junior familiar with administrative law, should be rejected. This was a relatively small matter involving a small sum in question. Moreover, the defendants were only notified of the ex parte orders shortly before Christmas during the Court vacation when it is notorious that barristers take leave and few are available.

74. Section 56(2) of the Civil Procedure Act provides that the Court must seek to give effect to the overriding purpose, which is to facilitate the just, quick and cheap resolution of the real issues in the proceedings, when it exercises any power given to it by the Act or Rules. The facility to make a gross sum costs order under s 98(4)(c) is such a power. Moreover, s 60 of the Civil Procedure Act provides that the practice and procedure of the Court should be implemented with the object of resolving the issues between the parties in such a way that the cost to the parties is proportionate to the importance and complexity of the subject-matter in dispute.

75. The claim in the Local Court was variously said to be either $75,931 or $35,931. In either case that is a small claim as far as litigation is concerned. What occurred in the Local Court resulted in the proceedings in this Court which I determined in my earlier judgment on 12 January 2018. The proceedings in the Local Court are now not being pursued because, as Mr Sayer-Jones’ emails disclose, he asserts that he was defrauded by the person from whom he purported to purchase the debt on which he sued in the Local Court. There is a strong need, therefore, for the present proceedings to be brought to an end in the quickest, fairest and most economical way. In that regard, all that is outstanding is the costs which I have already ordered should be payable by Mr Sayer-Jones.

76. Ms Nygh acknowledged in her evidence that the costs charged to the defendants by Resolve were high although she did not consider that they were unreasonable in the circumstances. Her principal reason for thinking that the costs were high was because of the extent of the email correspondence which those solicitors were obliged at least to read and in many cases answer. Unaided by Ms Nygh’s expert opinion in that regard, I would have been of a similar view that the costs had been unnecessarily increased by the reason of the excessive email correspondence generated by Mr Sayer-Jones.

77. Unlike many proceedings where a gross sum costs order is sought where proceedings are lengthy and complex (for example, Chaina v Presbyterian Church) the present proceedings are relatively confined and straightforward. That in itself may provide a proper basis for such an order: Australasian Performing Rights Association Limited v Marlin [1999] FCA 1006 at [4]. As Rares J said in Keen v Telstra Corporation Limited (No 2) [2006] FCA 930 at [6]:

[A gross sum costs order] is also appropriate to be used in cases which are simple and in which there would be utility in the court cutting the Gordian knot of protracted fights about costs… .

That approach was followed by Fagan J in Dickens v State of New South Wales [2018] NSWSC 14 at [9]. A good reason for doing so is found in s 60 of the Civil Procedure Act.

78. It is a reasonable inference, and I so infer, that Mr Sayer-Jones will continue to remain unrepresented in any costs assessment process. I am not critical of the way Mr Sayer-Jones conducted the proceedings before me, except as to his prolific use of email, but, as with any self-represented litigant even one with some legal training as Mr Sayer-Jones has obviously had, there is a need at times for the Court to be vigilant to ensure that proper procedures are followed and that all that is litigated are the true issues between the parties. The problem was evident at times in relation to Mr Sayer-Jones’ desire to cross-examine witnesses, both in the principal proceedings and on the present motion, on matters that were not properly in issue between the parties and in the manner of his cross-examination which was at times unfocused and repetitive. I mention these matters, not to be critical of Mr Sayer-Jones, but because there is a strong likelihood that any assessment of costs is likely to be conducted in a similar manner which will lengthen that process and result in the incurring of additional costs.

79. Moreover, Mr Sayer-Jones has demonstrated on a number of occasions an uncompromising approach to the litigation. He is very conscious of his legal rights and has on occasions expressed his intentions to take full advantage of those rights. For example, in an email to Resolve of 11 January 2018 in reference to the undertaking as to costs he said:

I made the undertaking on the basis that costs would be assessed in the ordinary course of events and did so in the knowledge that I could challenge a costs assessments by not only making submissions about the quantum but then issuing proceedings to have the costs assessment set aside as being manifestly too high.

80. In similar vein, in his written submissions on the present application, Mr Sayer-Jones said this:

[35]   It is another thing to pay costs when no such assessment has been done. Is it seriously suggested by the defendants that the plaintiff should become a supine puppet and simply lay down? It is the stuff of fantasy. It is ironic that Resolve Litigation Lawyers has its name sake: If one thing is clear nothing will be resolved in this litigation. To the contrary, it will be hard fought and this Court cannot endorse a categorical rule that in any case where there is a challenge to a costs assessment there will be a gross sum costs order.

81. Some further examples of this are found in emails sent by Mr Sayer-Jones to Resolve. On 9 January 2018 he said in an email:

I have decided moreover, that I will have to take this case all the way to the High Court if necessary not because the case involves a lot of money but from a commercial perspective I cannot be seen to have capitulated.

82. In an email dated 10 January 2018 to Resolve he said this:

Further to my last email with respect to appellate rights I do plan, if I lose in the Supreme Court, of taking this all the way to the High Court of Australia with its resultant stress and so forth.

I hope that I am successful in the Supreme Court but if I am not I am simply obligated to take the matter all the way to the High Court of Australia.

My case raises some very significant legal issues and it is a principle issue for me.

You have to appreciate, moreover, that by making me a party as you did that has had the perverse effect of absolutely guaranteeing that if I am unsuccessful I will be obligated to aggressively invoke my appellate remedies as I cannot have a judgment against me.

It is as simple as that.

If I am unsuccessful I will be seeking an emergency stay of 28 days so I can file an appeal in the ordinary course during the Court's normal process before the Court of Appeal duty judge (who can stay the orders of Justice Davies).

My summons cannot be described as to (sic) manifestly hopeless as to be not appealable (sic), it does, in fact, raise major legal issues and a major point of principle.

I appreciate the enormous costs of litigation but your clients should have, with respect, thought of the practical effect of getting a costs order against me. It will necessitate an appeal by me. It is simply not an optional thing. This matter will, if I am unsuccessful, go to the Court of Appeal and to the High Court of Australia if necessary.

83. In an email dated 13 January 2018 to Resolve Mr Sayer-Jones said this:

If your clients dare to take any enforcement action against me I will immediately file, in my own personal capacity, an action against your clients for malicious prosecution of the notice of motion under the principles in Wilfers v Joyce and Anor [2016] UKSC 43. I will then use these proceedings as a set off against any bankruptcy proceedings you may choose to bring I suggest, with respect, that filing a notice of motion which had zero chance of success is a classic malicious prosecution and I will use It as a set off and I will claim damages in the amount of $1,000,000 in the Supreme Court against all your clients. There has been a finding by a Supreme Court judge that the notice of motion was hopeless. I will also seek to sue Ms Sara Donaldson for her defamation in the Supreme Court concerning the statement that my proceedings in the Supreme Court were baseless. The imputation is I brought a hopeless claim to the Supreme Court. It is manifestly clear that my action was not hopeless and it would have been struck out on that basis.

For all these reasons, I suggest that the only remaining issue is what costs are payable after his Honour's decision of the summons and lacks commercial reality to prolong this litigation. If you want to cut your client's losses and bring this litigation to a close please do back off and don't file a notice of motion.

If your clients do I will aggressively defend myself against any costs order. It seems almost certain, as night follows day, that pursuing me will be incredibly expensive for your clients and I invite them to try.

84. As soon as I published my reasons for judgment in relation to the principal proceedings, Mr Sayer-Jones indicated, without having seen my reasons, that he would appealing against my judgment. Further, during the course of the hearing of the present motion when Mr Sayer-Jones sought an adjournment to prepare written submissions to respond to the defendants’ motion, he said that, if that adjournment was not granted, his primary submission in the Court of Appeal (thereby assuming an appeal from an adverse decision) would be that he was denied procedural fairness in the ability to prepare submissions.

85. All of these matters are clear indicators to me that any costs assessment process is likely to be strongly contested by Mr Sayer-Jones and is thereby likely to be protracted and more expensive.

86. There can be little doubt that the plaintiff is an empty shell. In an email dated 12 January 2018 to Resolve Mr Sayer-Jones said:

Marlinspike has no money and no good will and no assets and it does not even have a bank account.

There are numerous other similar references. Further, any shareholding, directorship or control of the plaintiff has now passed out of Mr Sayer-Jones’ hands or those of his other companies, as he acknowledges.

87. Moreover, apart from a reference to bankruptcy proceedings against him in the email set out at [83] above, there are other references in emails from Mr Sayer-Jones to bankruptcy if a gross sum costs order is made against him. Those references give rise to doubts about Mr Sayer-Jones’ ability to meet any costs order.

88. The matters that I consider justify a gross sum costs order in the present case are:

(a)   the relatively small amount in issue in the proceedings and the issue of proportionality of costs;

(b)   the fact that the plaintiff and Mr Sayer-Jones will continue to be self-represented;

(c)   the manner in which the proceedings have been conducted to date; and

(d)   the near certainty that the plaintiff is impecunious and doubt concerning Mr Sayer-Jones’ ability to pay any costs order.

89. As I have noted earlier, the authorities mandate a broad brush approach to the identification of any gross sum order that should be made. A judge making such an order can bring his or her own experience to bear on figures put forward. In coming to the views I have reached in relation to the amounts I have, however, been chiefly guided by the opinion of Ms Nygh. Having said that, whilst I consider the figures for party/party costs identified by Ms Nygh for the summons costs order and the defendants’ earlier motion costs order to be reasonable, I consider the amount identified for the present application to be unreasonably high.

90. Although Ms Nygh has distinguished between costs in relation to the summons and those in relation to the defendants’ first motion filed 3 January 2018, in the light of my findings in my earlier judgment, the distinction is somewhat artificial. I concluded at [79] of that judgment that the vast majority of the time at the principal hearing was taken up with argument about the summons which necessarily included prayer 2 in the defendants’ motion. I also concluded that the evidence prepared in support of the defendants’ motion was relevant to the issues argued on the summons. That meant that the defendants were successful entirely on the summons and on the principal issue argued on the motion, being prayer 2. It was for those reasons that I ordered the plaintiff and Mr Sayer-Jones to pay 90% of the defendants’ costs of the motion.

91. The authorities also tend to point to the need for an impressionistic discount of the costs actually incurred to take account of the contingencies that would be relevant in any formal costs assessment: Hamod at [820] and the cases there referred to. Another reason for the discount is that the successful party will receive those costs at a much earlier time than would occur if the matter went to assessment. Mr Tam agreed that this discount is over and above the reduction made by Ms Nygh whereby on an assessment approximately two thirds of the fees and 100% of disbursements including counsel’s fees would be assessed as party-party costs (see [22] above). He submitted, however, that the discount would be a small one particularly because of the costs estimated to be incurred after Ms Nygh had prepared her affidavit (see [19] above).

92. A review of the authorities shows a varied approach to the amount of this discount. Some of the cases are noted in Ritchie's Uniform Civil Procedure NSW LexisNexis, Sydney 2005 at para [98.65] and they vary from 30% to nil.

93. In my opinion, the further discount in the present case should be small because the case itself was a small one involving a small amount in issue, and the costs in relation to the present motion do not include the estimated costs that postdate Ms Nygh’s affidavit, such costs including the actual appearance to argue this motion. That motion was heard from 9:30am to 1:50pm. I accept that the estimates provided by Ms Nygh are likely to be significantly short of the actual costs incurred. Set against that is that the starting point for the costs for the present motion were high.

94. The defendants have been successful on the present motion, and they should have an order for costs of that motion in their favour against the plaintiff and Mr Sayer-Jones who resisted the motion. Those costs should also be payable on a gross sum basis.

95. Mr Sayer-Jones asked that whatever orders I made should only be enforceable after seven days from the making of the orders to give him time to appeal from the orders. I will so order.

96. In those circumstances, I make the following orders:

(1)   Refuse application for recusal.

(2)   Refuse leave to Robert Lyndon Sayer-Jones to be released from the undertaking given by him on 9 January 2018 to be personally liable for costs ordered to be paid to the defendants.

(3)   Vary order 2 made by me on 12 January 2018 to provide that the plaintiff and Robert Lyndon Sayer-Jones are to pay the defendants’ costs of the summons assessed in the sum of $7,000.

(4)   Vary order 4 made by me on 12 January 2018 to provide that the plaintiff and Robert Lyndon Sayer-Jones are to pay 90% of the defendants’ costs of the notice of motion filed 3 January 2018, such 90% being assessed in the sum of $13,400.

(5)   Order the plaintiff and Robert Lyndon Sayer-Jones to pay the defendants’ costs of the notice of motion filed 24 January 2018 assessed in the sum of $15,000.

(6)   Stay execution of orders (3), (4) and (5) until 19 February 2018.

(7)   Liberty to apply.

**********

Amendments

08 April 2025 - Publication restriction lifted

Decision last updated: 08 April 2025