Marmota Ltd v Thomson Geer
[2020] SASC 43
•27 March 2020
SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Civil)
MARMOTA LTD v THOMSON GEER
[2020] SASC 43
Judgment of Auxiliary Judge Kennewell a Master of the Supreme Court
27 March 2020
PROFESSIONS AND TRADES - LAWYERS - SOLICITOR AND CLIENT - RETAINER
STATUTES - ACTS OF PARLIAMENT - INTERPRETATION
Application to fix legal costs - preliminary issues to be determined before costs adjudication can proceed.
Legal Practitioners Act 1981 (SA); Legal Profession Act 2007 (Qld); Legal Profession Act 2004 (NSW); Evidence Act 1929 , referred to.
Turner v Mitchell Solicitors [2011] QDC 061; Branson v Tucker [2012] NSWCA 310; Aretzis & Anor v Larwood & Anor [2002] SASC 367; Kowalski v Cole [2017] SASCFC 23, considered.
MARMOTA LTD v THOMSON GEER
[2020] SASC 43
On 19 March 2019, the plaintiff filed an application to fix the legal costs due to the defendant, for the provision of legal services.
The parties agreed the following list of preliminary issues which they request to be determined by the Court before the costs adjudication proceeds:
1Whether or not the invoices issued by the defendant the subject of the application are governed by any costs agreement, and if so, which costs agreement within the meaning of Schedule 3 of the Legal Practitioners Act 1981 (the Act).
2Whether any, and if so which, of the invoices the subject of the application are interim bills for the purposes of clause 35 of Schedule 3 of the Act.
3Which invoices can be adjudicated upon in the application, having regard to clauses 35 and 37(4) of Schedule 3 of the Act.
4Whether the Court has inherent jurisdiction to adjudicate the costs of its practitioners in circumstances where such adjudication would be precluded by clause 37(4) of Schedule 3 of the Act.
The matter was listed for argument on 4 and 5 December 2019. The parties filed written submissions prior to the hearing and the defendant filed further written submissions on 14 January 2020. Mr Williams gave oral evidence for the plaintiff.
The plaintiff relies upon the affidavit of Colin Rose affirmed on 27 June 2019. The defendant objected to certain parts of this affidavit. The objections were considered and ruled upon at the hearing and certain paragraphs were struck out in their entirety or in part. The affidavit has been marked accordingly.
The defendant relies upon the affidavits of Lee Scott Dewhirst sworn on 23 May 2019 and 12 July 2019, affidavits of Fraser Michael Bell sworn on 23 May 2019 and 10 July 2019, and affidavits of Matthew Roy Harders sworn on 12 July 2019 and 28 November 2019.
In the defendant’s submissions filed on 14 January 2020, the defendant applies to tender a letter dated 21 August 2019 addressed from Dr Rose to Mr Williams. The letter was marked for identification during submissions. The defendant submits that the letter is admissible and relevant as it gives the Court insight into Dr Rose’s evidence and attitude to this matter, especially his attitude to Mr Williams. The defendant further submits that it is a “business record” and admissible pursuant to S 53(1) of the Evidence Act 1929. The letter was written by Dr Rose to request Mr Williams to provide an affidavit for the purposes of this matter. I am not satisfied that the letter is a “business record” in accordance with the definition in s 53(4) of the Evidence Act 1929. In any event, I do not consider that Dr Rose’s attitude is relevant to any of the issues I am required to decide. I must objectively assess whether there was a binding costs agreement. Mr Rose’s attitude to Mr Williams and this matter is not relevant to this assessment and therefore I have determined not to admit the letter.
Whether or not the invoices issued by the defendant the subject of the application are governed by any costs agreement, and if so, which costs agreement within the meaning of Schedule 3 of the Act.
Background
The plaintiff is a public company. By email dated 17 March 2016 to Mr Williams (the Managing Director of the plaintiff at that time), the defendant sent a legal engagement letter (Letter) with enclosed terms of engagement (Terms of Engagement).[1] There is no dispute that together the Letter and Terms of Engagement comprised an offer to the plaintiff to enter into a costs agreement with the defendant on the terms contained therein (Offer). It is also not disputed that the costs agreement was not accepted in writing. The costs agreement was not signed and returned. The defendant’s case is that the Offer was accepted by the plaintiff’s conduct by instructing the defendant after the date of the Letter.
[1] Exhibit D1.
The Offer related to the provision of legal services by the defendant to the plaintiff regarding a non-renounceable ASX rights issue (Rights Issue) for a fixed fee of $3,000. The Letter set out the scope of work and stated:
You (Marmota) will prepare all relevant documentation …
The Letter further stated:
You may accept this offer in writing or you are deemed to have accepted it by continuing to instruct us after the date of this letter.
The plaintiff denies that the defendant was instructed to do work under this Costs Agreement. It is agreed that the defendant did not bill the plaintiff for this work.
Was the costs agreement accepted?
Whether or not the Offer was accepted is to be determined objectively by reference to the words or actions of the offeree.[2] There is a conflict of evidence in this case as to whether the Offer was accepted by the plaintiff instructing the defendant to act in relation to the Rights Issue. The onus is on the defendant on the balance of probabilities to establish that the Offer was accepted by the plaintiff’s conduct.
[2] N C Seddon, R A Bigwood and M Ellinghaus, Cheshire and Fifoot Law of Contract (LexisNexis Butterworths, 10th ed, 2012) [3.22].
The plaintiff issued a subpoena to Mr Williams to give evidence. Mr Williams was formerly a legal practitioner and partner of a commercial law firm. Mr Williams gave evidence that he sought a quotation from the defendant to settle documents that he would draft in relation to a Rights Issue. Mr Williams said that “as best he could recall” he did not instruct the defendant to settle documents for the purpose of proceeding with the Rights Issue as the plaintiff had not decided to proceed with the Rights Issue. Mr Williams had no recollection of providing documents to the defendant to settle or receiving any settled documents from the defendant. Mr Williams was very clear that he did not instruct the defendant to produce primary documents for the Rights Issue.
When cross-examined, Mr Williams said that having now seen the documents, he recalled receiving documents from Mr Dewhirst and querying him as to why he had sent him the documents. Mr Williams said Mr Dewhirst’s response was “oh well, I had prepared them. I thought I’d send them to you anyway”.[3]
[3] T50.36-37.
Mr Williams said that he did not recall receiving a bill for the Rights Issue and would have been very surprised if he had.[4] When re-examined, Mr Williams said that he would have been surprised as “we had never engaged Thomson Geer to perform work on the Rights Issue”.[5]
[4] T55.4-5.
[5] T59.9-10.
Mr Dewhirst states that on 17 March 2016, shortly after he sent the email containing the Offer, Mr Williams instructed him to commence providing legal services in relation to the Rights Issue. Mr Dewhirst opened a file and recorded time against the file. The defendant’s Aderant system shows a time entry for 17 March 2016 with the narration “Considering instructions from David Williams”.[6] The defendant has not produced any notes of a telephone call or other communication from Mr Williams recording that he accepted the Offer.
[6] Affidavit of Lee Dewhirst [7], Exhibit LSD 3.
In his affidavit, Mr Dewhirst set out the work he performed in relation to the Rights Issue which included drafting the documentation.[7] Mr Dewhirst explained that he did not issue any fee invoice for the work done on the Rights Issue as a gesture of good will, for business development reasons.
[7] Affidavit of Lee Dewhirst [9] and [10].
Having considered the evidence, I am not satisfied that the plaintiff instructed the defendant in relation to the Rights Issue. The work carried out by Mr Dewhirst was not consistent with the scope of work as outlined in the Letter. No documentation has been produced about a change in instructions. The Letter made it clear that the proposed costs agreement was for the defendant to settle documents for a fixed fee of $3,000. Mr Williams did not provide any documents to the defendant to settle.
Mr Dewhirst may have believed that he had been instructed to carry out the work but I consider that he must have been mistaken. I accept Mr Williams’ evidence that he was surprised to receive the documentation and would have been shocked to receive a bill as he had not instructed the defendant to produce the documents. I find that the plaintiff did not accept the Offer to enter into the costs agreement by instructing the defendant to act in relation to the Rights Issue.
The defendant further submits that by instructing the defendant after the date of the Letter, the plaintiff accepted the Offer and became bound by the costs agreement. The Letter stated that the “Terms of Engagement will apply to all future matters … unless we agree otherwise in writing”. The defendant submits that the email sent by Mr Williams on 30 May 2016, clearly instructed the defendant and Mr Bell to act in relation to certain land access matters and proceedings in the Environment, Resources and Development Court (Land Access matter).[8] The defendant contends that there is no need for me to resolve the conflict of evidence in relation to whether the plaintiff instructed the defendant to act in relation to the Rights Issue because by 30 May 2016, the plaintiff had instructed the defendant to act in relation to the Land Access matter and therefore is bound by the costs agreement.
[8] Defendant’s submissions promised by Mr McCarthy on 5 December 2019, filed on 14 January 2020.
Having found that the plaintiff did not accept the Offer by instructing on the Rights Issue, I now turn to consider whether the Offer was accepted by the plaintiff instructing the defendant to act in relation to the Land Access matter. There is no dispute that the plaintiff instructed and the defendant acted for the plaintiff in the Land Access matter.
The plaintiff’s position is that the Offer to enter into the costs agreement was not accepted by the plaintiff in relation to the Rights Issue and therefore it cannot flow through to any future engagement of the defendant by the plaintiff. The plaintiff further submits that even if the costs agreement had been accepted by the plaintiff, it cannot flow through to any future matter where the plaintiff instructs the defendant to act. The Terms of Engagement states:
These Terms of Engagement and our letters and emails setting out particular work we agree to do for you (each a Legal Project), are costs agreements setting out the basis upon which you engage us to act for you …
Clause 5 provides:
We normally charge for our services by reference to the time we spend and in accordance with hourly rates. Our rates at the time of issue of these terms are set out on the last page of these terms and more specific information is provided in letters and emails confirming our engagement for each Legal Project.
The Terms of Engagement also refer to periodic reviews of the rates[9] and higher rates for some specialist taxation, corporate and commercial matters.[10]
[9] Clause 5, Terms of Engagement.
[10] Clause 19.1, Terms of Engagement.
The plaintiff contends that the costs agreement clearly contemplates that the defendant will provide more specific information about rates in letters and emails confirming each project. The agreement does not advise that the hourly rates as set out in the Terms of Engagement are the rates that will apply to any work done in the future.
Reading the offer to enter into a costs agreement as a whole, namely the Letter and the Terms of Engagement, a reasonable bystander would understand that the Offer was an offer to act in relation to the Rights Issue. It is stated in the Letter that “this is an offer to enter into a costs agreement comprising this letter and the attached terms of engagement”. It was further stated that the “letter overrides the attached terms of engagement to the extent of any inconsistency”. I have found that the Offer was not accepted by the plaintiff as the plaintiff did not instruct the defendant to act in relation to the Rights Issue. The Offer not having been accepted, it cannot bind the plaintiff for any future matter.
The plaintiff did later instruct the defendant to act in relation to the Land Access matter. However in my view, those instructions are not an acceptance of the Offer comprised of the Letter and the Terms of Engagement. The statement that the Terms of Engagement will also apply to all future matters must be interpreted as applying if the Offer as set out in the Letter is accepted. The Offer cannot be construed as an offer to act for the plaintiff at any time in the future on the terms as set out in the Terms of Engagement. As the plaintiff submits, the Terms of Engagement contemplate letters and emails setting out the work for each Legal Project and that more specific information is to be provided in letters and emails confirming the defendant’s engagement for each Legal Project. The Terms of Engagement set out a range of hourly rates for different categories of lawyers and underneath that range, it is stated that, “specific current rates of the lawyers who will mainly do the work covered by each costs agreement, will be set out in the letter or email outlining that work”. This reinforces my view that the Offer cannot be construed as intending to bind the parties to the rates in the Terms of Engagement for any future matters the defendant undertook for the plaintiff.
Even if it could be said that the plaintiff accepted the Offer by instructing the defendant to act in relation to the Land Access matter, I consider that the agreement would be invalid due to uncertainty as it is does not provide a method to calculate the amount of the costs to be charged. The defendant submits that the agreement should be construed in a commercial manner and I should find that there was a binding agreement to pay the minimum rate in the appropriate ranges. I disagree. The Terms of Engagement give an indication of the range of rates that might be charged but state that more specific information will be given. It is contrary to the plain words in the Terms of Engagement to find that there was an agreement to pay the minimum rate for any future matters the defendant conducted for the plaintiff. It was clearly contemplated that more specific information as to the rates to be charged would be provided for each Legal Project. I further note that the plaintiff was not charged in accordance with the hourly rates as set out in the Terms of Engagement. Mr Bell’s time was billed out at $420 per hour, this rate does not fall within the range for a Partner.
There is a requirement set out in Schedule 3, clause 47 of the Act for the Supreme Court to adjudicate costs that are subject to a costs agreement, that a provision of the costs agreement specifies the amount, or rate or other means of calculating the amount of the costs. As the defendant submits, I am determining preliminary issues and not adjudicating costs but it is relevant to note that a range of rates does not comply with the requirement in clause 47 as there is no means available to calculate the amount of costs.
The defendant argues that the plaintiff is estopped from asserting that the costs agreement is invalid or otherwise does not to apply. I have determined that the costs agreement does not as a matter of construction extend to any future work conducted by the defendant for the plaintiff. Therefore, any reliance placed upon the costs agreement by the defendant was misconceived. In any event, the defendant did not charge in accordance with the costs agreement and therefore it cannot be said that there was reliance upon it. I am not persuaded that there is any basis that the plaintiff should be estopped from asserting that the costs agreement is invalid or does not apply in these circumstances.
Conclusion
The defendant asserts that its costs are to be adjudicated by reference to a costs agreement between the plaintiff and defendant. The plaintiff contends that the costs agreement is comprised of the Letter and Terms of Engagement sent by email dated 17 March 2016 to Mr Williams. I have found that this Offer was not accepted by the plaintiff. The Offer not having been accepted, it cannot bind the plaintiff for any future matter. Therefore, the invoices are not governed by the costs agreement.
Whether any, and if so which, of the invoices the subject of the application are interim bills for the purposes of clause 35 of Schedule 3 of the Act.
The plaintiff concedes that bills 2 and 4[11] relate to disputes with a company known as Australian Mineral and Waterwell Drilling and certain other individuals (AMWD Disputes) and relate to a matter that was finally billed in April 2017, and are therefore out of time to be adjudicated upon under the Act.
[11] A table referencing the 12 bills is contained in paragraph 3.5 of the Defendant’s Outline of Submissions (FDN 10).
The plaintiff and defendant are agreed that bills 5 to 11 are interim bills to bill 12.
There is a dispute as to the status of bills 1 and 3. The plaintiff submits that bills 1 and 3 are also interim bills to the final bill sent on 23 October 2018 (bill 12). The defendant contends that bill 1 is an interim bill to bill 3 (issued on 11 May 2017) which is a final bill with respect to the Land Access Matter as it covered all the legal services the defendant was retained to provide at that time, namely to secure and implement a right of access in favour of the plaintiff. The defendant asserts that the period 14 April 2017 until 6 September 2017 (inclusive) was a natural rest period. During this period, the plaintiff did not instruct the defendant and no time was recorded against the file. The defendant did not provide legal services to the plaintiff or issue any invoices to the plaintiff.[12]
[12] First Affidavit of Michael Bell (FDN5) [12].
The plaintiff submits that the bill issued on 11 May 2017 was not a final bill as it was not treated as a final bill by the solicitors. The file was not closed. When further work was done in October 2017, the same file number and the same title were used. The plaintiff further submits that the action had not concluded as further steps were required to get access to the land and it was subject to an obligation to pay compensation which had not been finalised.
Clause 35 of Schedule 3 of the Act provides:
(1) A law practice may give a person an interim bill covering part only of the legal services the law practice was retained to provide.
(2) Legal costs that are the subject of an interim bill may be adjudicated under Part 7, either at the time of the interim bill or at the time of the final bill, whether or not the interim bill has previously been adjudicated or paid.
The term “interim bill” is not defined in the Act. However, it is clear from clause 35 that an interim bill is a bill that covers part only of the legal services the law practice was retained to provide. McGill DCJ in Turner v Mitchell Solicitors[13] when considering the same issue with respect to the equivalent section in the Legal Profession Act 2007 (Qld) stated:
There can be a situation where a costs agreement can be entered into to cover particular legal work, and any other legal work which the solicitor is instructed to carry out. If the particular legal work is then completed, and there have been no further instructions, then the legal services the solicitor is retained to provide have been performed. If a bill is sent at that point it is a final bill, and it does not become an interim bill simply because at some later stage further instruction are given for additional legal services to be provided to which the earlier costs agreement also applies. In my opinion it is important to apply s 333 according to its terms, and not by reference to extraneous considerations, such as whether the legal work is undertaken under a single costs agreement or multiple costs agreements.
[13] [2011] QDC 061.
It is necessary to consider what legal services the defendant was retained to provide and whether the bill issued on 11 May 2017 is a final bill. The email from the plaintiff instructing the defendant to act with respect to the Land Access matter stated “[w]e would like to proceed with the access waiver route and deal with the subsequent challenge through the ERD [Court]”. The context of this email was that it was a response to a letter of advice from the defendant dated 25 May 2016 setting out options for securing access for exploration. The defendant advised the plaintiff that conditions of access could include compensation. The defendant provided an estimated budget for the ERD Court proceedings. In my view, the initial retainer for the Land Access Matter was to conduct the ERD Court proceedings with a view to obtaining access to the land. These services had been provided. Although the compensation aspects of the matter had not been finalised, the plaintiff had not requested the defendant to provide any other legal services. It is clear from the correspondence of 7 September 2017 that additional legal services were sought at that time and that prior to that time the plaintiff had been corresponding directly with the other party.[14] Therefore, I am of the opinion that when the bill was issued on 11 May 2017, the initial retainer had ceased and the bill was a final bill. Therefore, bills 1 and 3 are not interim bills to the 23 October 2018 bill and are out of time to be adjudicated upon under the Act.
Which invoices can be adjudicated upon in the application, having regard to clauses 35 and 37(4) of Schedule 3 of the Act.
[14] First Affidavit of Michael Bell (FDN5) [13] and FMB4.
Bills 5 to 11 are interim bills that are tied to invoice 12 as a final bill. Therefore, invoices 5 to 12 inclusive can be adjudicated upon. This is accepted by the defendant.[15] For the reasons set out above, invoices 1 and 3 are not interim bills tied to invoice 12 and are therefore out of time to be adjudicated upon under the Act. The defendant concedes that bills 2 and 4 relate to the AMWD disputes and are out of time to be adjudicated upon under the Act.[16] As the plaintiff is a sophisticated client, there is no power to extend time under the Act.[17]
Whether the Court has inherent jurisdiction to adjudicate the costs of its practitioners in circumstances where such adjudication would be precluded by clause 37(4) of Schedule 3 of the Act.
[15] Defendant’s Outline of Submissions [4.14].
[16] Outline of Submissions of the Plaintiff [2.2].
[17] Schedule 3, cl 37(5).
The plaintiff submits that invoices that are precluded from being taxed by clause 37(4) of Schedule 3 may still be taxed under the inherent jurisdiction of the Court. The plaintiff refers to the decision of Branson v Tucker.[18]
[18] [2012] NSWCA 310.
When considering the time limit in Schedule 3, clause 37(4) of the Act, the learned author of Legal Costs states:
After 6 months, sophisticated clients or sophisticated third party payers might still obtain an adjudication under the court’s inherent supervisory jurisdiction over solicitors as officers of the court, but this might well only be obtainable if there was clear evidence of gross overcharging.[19]
[19] Peter Norman, LexisNexis Butterworths, Legal Costs South Australia, (online at 24 March 2020) [714].
The plaintiff submits that the basis upon which the inherent jurisdiction should be exercised is that at least some of the bills are charged on a time basis when, due to the invalidity of the retainer agreement, they should be charged on a Scale basis and thus there will likely be a considerable overcharge.
The defendant submits that by operation of clauses 37(4) and (5) of Schedule 3 of the Act, the plaintiff is precluded from bringing an application for adjudication of the costs charged in invoices 1 to 4 as the statutory time limit of 6 months for bringing such an application has expired. As the plaintiff is a public company and therefore a “sophisticated client”, no extension of time may be granted. The defendant contends that as the “statute makes a particular provision for a particular situation”,[20] that is, the time limit within which a sophisticated client may bring an application for an adjudication of costs, the inherent jurisdiction of the Court to settle the costs is displaced by the statute.
[20] Aretzis & Anor v Larwood & Anor [2002] SASC 367 [26] (Doyle CJ).
The defendant further submits that overcharging and professional misconduct by a legal practitioner are provided for by the Act and the Commissioner is given powers to deal with unsatisfactory professional conduct and professional misconduct, and powers to deal with complaints of overcharging by legal practitioners.[21] Therefore, the Court has no inherent jurisdiction to adjudicate the defendant’s invoices on the basis of actual or alleged unsatisfactory professional misconduct, or overcharging as that jurisdiction has been displaced by the Act. In the alternative, the defendant submits that the mere overcharging does not, as a matter of course, automatically invoke the inherent jurisdiction of the Court to allow it to settle the overcharged costs. Any overcharging must be enough to establish a prima facie case of professional misconduct by overcharging.
[21] Part 6, Subdivision 2 and Subdivision 4 of the Act.
Consideration
Clauses 37(4) and (5) provide:
(4)An application by a client or third party payer for an adjudication of costs under this clause must be made within 6 months after—
(a) the bill was given or the request for payment was made to the client or third party payer; or
(b) the costs were paid if neither a bill was given nor a request was made.
(5) However, an application that is made out of time, otherwise than by—
(a) a sophisticated client; or
(b) a third party payer who would be a sophisticated client if the third party payer were a client of the law practice concerned,
may be dealt with by the Supreme Court if the Court, on application by the client or third party payer who made the application for adjudication, determines, after having regard to the delay and the reasons for the delay, that it is just and fair for the application for adjudication to be dealt with after the 6 month period.
I am of the view that Branson v Tucker,[22] which concerned a barrister suing for his fees as a debt may be distinguished. The New South Wales Court of Appeal was there considering an appeal from the District Court from a decision to refuse to strike out the defence. The defence pleaded that the fees were excessive, the hours charged were in excess of what was reasonably and necessarily required and the barrister had breach the implied term of the retainer, to exercise reasonable care and skill, by charging for more hours than was reasonable or necessary. The Court held that although the statutory time limit for an assessment of the legal costs under the Legal Profession Act 2004 (NSW) had expired, the general jurisdiction to assess the reasonableness of the legal costs was not precluded.
[22] [2012] NSWCA 310.
Campbell JA with whom the other members of the Court agreed referred to s 366 of the Legal Profession Act 2004 (NSW) and stated:
… in so far as s 366 provides that "this Division does not limit the power of a court or a tribunal to determine in any particular case the amount of cost payable" it is talking about the whole of Division 11. Read in accordance with that ordinary meaning it has the effect that Division 11 does not remove the power of the District Court in exercising "the ordinary jurisdiction of the Court in dealing with contested claims", to determine the amount of costs payable.[23]
[23] Ibid [103].
Campbell JA went on to decide that Division 11 did not provide an exclusive means by which the reasonableness of legal costs can be ascertained. There is no equivalent to s 366 in the Act and therefore this decision is of limited assistance.
In Kowalski v Cole,[24] Blue J stated:
Under the general law and independently of the statute, a solicitor is an officer of the court. As such, a solicitor owes various duties to the court independently of, and paramount to, the solicitor’s duties to his or her client. As such, a solicitor is subject to the overriding supervision of the court. This jurisdiction predated statutory regulation and the inherent jurisdiction of this Court over solicitors survives subject only to statutory exclusion. An example of supervision exercised by the court is the enforcement of undertakings given by solicitors.
Supervision is exercised by the court over solicitors in relation to costs charged to clients. The jurisdiction is exercised because solicitors are officers of the court. The court has inherent jurisdiction to examine the fairness and reasonableness of a costs agreement and set it aside if it is not fair and reasonable. The rationale for the existence of this jurisdiction is that, due to the special relationship of confidence between solicitor and client, a presumption of undue influence arises and the onus lies on the solicitor to rebut it.
[24] [2017] SASCFC 23.
After examining the relevant authorities, Blue J stated:
It is an incident of the jurisdiction of the court over costs charged by solicitors to clients that the court can order repayment by a solicitor of an amount overcharged to and paid by a client. Where the jurisdiction to tax costs is statutory, the statute may impose a time limit for applications to tax costs. Otherwise, there is no time limit. For example, there was no time limit until 2014 for applications to tax costs under section 42 of the Legal Practitioners Act 1981 (SA).[25]
[25] Ibid [28] (citations omitted).
The Act deals extensively with adjudication of costs by the Supreme Court. There is now a time limit for applications by clients or third party payers for adjudication of costs under clause 37 and Parliament has determined to exclude certain persons from making applications for extension of time. Generally, legislation is presumed not to oust established jurisdictions.[26] In this case, I consider that Parliament has by implication removed the power of the Supreme Court to adjudicate costs where a sophisticated client makes an application out of time. The Court retains the inherent jurisdiction to supervise the conduct of legal practitioners as practitioners of the Court and I consider that where there is evidence of misconduct or fraud that the Court may exercise this power. However, that is not the case here. I have determined that the costs agreement was not accepted by the plaintiff. There is no suggestion of misconduct by the defendant’s solicitors. At the highest it has been suggested that there has been a misunderstanding that a costs agreement was in place. The plaintiff puts the case no higher than there has been a considerable overcharge as the costs agreement does not apply and costs ought to have been charged on the Supreme Court Scale. The Act provides a detailed scheme for the adjudication of costs in these circumstances, but such an application must be made within a 6 month time limit. To determine that in these circumstances, the Court may adjudicate the costs is to override the will of the Parliament. In the circumstances of this case, it is my view that the Court has no inherent jurisdiction to adjudicate the costs in invoices 1 to 4.
[26] D Pearce, Statutory Interpretation in Australia, Lexis Nexis 9th edn [5.48 - 5.50].
Conclusion
The answers to the preliminary questions are:
1The invoices are not governed by the costs agreement.
2Bills 5 to 11 are interim bills to bill 12 for the purposes of clause 35 of Schedule 3 of the Act.
3Invoices 5 to 12 inclusive may be adjudicated upon under the Act.
4In the circumstances of this case, the Court does not have inherent jurisdiction to adjudicate the bills that are precluded by clause 37(4) of the Act.
Having determined the preliminary questions, I will hear the parties as to the form of the orders and other consequential matters.
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