Milisits v The State of South Australia - [2017] SASC 186

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
MILISITS v THE STATE OF SOUTH AUSTRALIA
[2017] SASC 186
Judgment of Judge Bochner a Master of the Supreme Court
15 December 2017
PROCEDURE - COSTS
Preliminary issues - application for certain aspect of plaintiff's claim for costs to be dealt with as a preliminary point.
Charlick Trading Pty Ltd v Australian National Railways Commission [2001] FCA 629; Subway Systems Australia Pty Ltd v Ireland (No 2) [2013] VSC 693; Newcastle City Council v Wieland [2009] NSWCA 113; Mead & Anor v Allianz Australia Insurance Ltd [2007] NSWSC 500; Owners – Strata Plan No 61162 v Lipman [2014] NSWSC 622; Smiths’ Snackfood Company Ltd v Chief Commissioner of State Revenue (NSW) [2013] NSWCA 470; Australia and New Zealand Banking Group Limited v Paciocco [2015] FCAFC 78; Dalgety Australia Operations Ltd v FF Seeley Nominees Pty Ltd (N0 2) (1988) 49 SASR 75; BHP Billiton Ltd v Parker (No 2) [2014] SASC 6, considered.

MILISITS v THE STATE OF SOUTH AUSTRALIA
[2017] SASC 186

Following resolution of this matter by the acceptance by the plaintiff of a filed offer, the defendant has applied to the Court to have certain aspects of the plaintiff’s claim for costs dealt with as a preliminary point. These aspects are:
·The plaintiff’s engagement of interstate counsel;
·The costs related the plaintiff’s expert; and
·The costs of the mediation held between the parties.
The offer which was accepted by the plaintiff included a term that the defendant would pay the plaintiff’s costs incurred in respect of the action, on a party-party basis.
Costs of mediation
In March 2016, the parties attended before his Honour the Chief Justice at a listing conference. The plaintiff deposes (and this is not disputed by the defendant) that at this hearing, the Chief Justice advised the parties that he would not list the matter for hearing until they had engaged in mediation. No order for mediation was made; the listing conference was adjourned. A mediation was subsequently held, with the Honourable Ian Callinan AC QC as mediator.
Prior to commencing mediation the parties signed a mediation agreement. The agreement provided as follows:
12.Each party will pay its own costs of the mediation unless the parties agree otherwise.
13.The parties will pay equally the Mediator’s fees and expenses in the amounts and at the time set out Schedule 2.[1]
[1] AJB 3 to FDN 85.
The plaintiff now contends that the costs of mediation fall within the costs agreement reached in settlement of the matter, and so should be paid by the defendant. These costs include, not only the portion of the mediator’s fees paid by the plaintiff, but also the costs of solicitor and counsel for preparation for and attendance at the mediation.
The defendant’s position
The defendant’s primary position is that the plaintiff cannot claim the costs related to the mediation, as this is precluded by the mediation agreement, on the basis that there has been “no agreement otherwise” between the parties. The defendant also made the submission that the mediation between the parties was not a court-ordered mediation; I did not understand that the defendant submitted that this, in itself, meant that the costs of mediation could not be, in appropriate circumstances, cost of or in respect of a proceeding, rather that it was one of a number of factors that should be taken into consideration when determining how to characterise the costs of mediation.
The plaintiff’s position
The plaintiff appears to have garnered a different understanding to me as to the submission made by the defendant as to the relevance of whether the mediation was ordered by the Court. The plaintiff understood the defendant’s submission to be that on this basis, the costs of the mediation did not fall within costs of the proceedings. The plaintiff’s position is that this is not correct, and the costs of mediation fall within the costs agreement between the parties at settlement. This is on two bases: the first being that while no formal court order was made referring the matter to mediation, the Chief Justice made it clear that the matter would not be listed for trial until mediation had taken place, hence it was in effect an order of the Court; and the second being that Clause 12 of the mediation agreement did not preclude the plaintiff from claiming the costs of the mediation from the defendant.
Consideration
The first question raised by the plaintiff can be easily dealt with. The authorities make it clear that the costs of mediation may be included in the costs of an action, whether or not the mediation was ordered by the Court. The prevailing view as to the costs of mediation is expressed by Mansfield J in Charlick Trading Pty Ltd v Australian National Railways Commission (Charlick):[2]
[92] I do not accept the proposition for which counsel for Charlick contended that cots of negotiations to explore compromise of a claim should never be allowed on a party and party taxation. There is a substantial public interest, as well as private interest, in the resolution of disputes by negotiation or by mediation. It is not a common feature of litigious claims that the parties are required to consider, and often to participate in, pre-trial mediation. The Rules prescribe powers and procedures to that effect. Negotiation and mediation may resolve a dispute entirely. Apart from the benefit to the parties of such resolution, such an outcome saves the costs associated with the trial and releases judicial and court resources to deal with other matters. Negotiation and mediation often also partly resolve a dispute so as to enable the focus of the parties in litigation to be more confined, again with consequential savings of time and expense to the parties and to the benefit of the public. In my view, steps taken by the parties to confine the areas of their dispute will often be able to be categorised as necessary or proper for the attainment of justice. They will often facilitate the presentation of the case so as to enable a just result to be achieved in an expeditious and economic manner. Even if those processes do not in fact result in any consensual outcome, either totally or in relation to certain issues or matters which then do not require proof, it does not follow that the processes themselves were not necessary or proper for the purpose of O62 r19 of the Rules. Those observations are not intended to lay down any precept that the costs of private negotiation or mediation should as a general rule be allowed on a party and party taxation. Whether they are allowed will depend upon the particular circumstances. Often, the parties agree upon the basis upon which the costs of mediation will be borne, or the agreement made at mediation will include terms as to costs.
[93] In this matter, bearing in mind the nature of the issues which were being addressed, I think it is likely that the private negotiations to endeavour to agree costs and actions taken in relation to those negotiations resulted in refinement of the areas of dispute and provided part of the process of refining the issues required to be addressed by the Court. Furthermore, the nature of the issues being addressed in such negotiations in the light of the costs order of 6 September 1999 was such as to be likely to lead to refinement of disputed issues. NRC was endeavouring to give effect to an order of the Court by addressing the detailed components of costs to which that order related. I do not consider that the line drawn by Holroyd J in Mackay v Hamilton [1905] VLR 457 at 460 - 461 between costs:
"...incurred by a party for the simple purpose of making a settlement ... [and] costs incurred in fighting or prosecuting the action until from one cause or another it has to stop"
is one which should continue to be rigidly given effect to. Indeed, his Honour recognised that costs incurred in seeking to procure a settlement may overlap with costs which would have been necessary for the prosecution of the action, and made allowance for that. But, in my view, in the light of the more modern approach to litigation discussed above, that sharply drawn line no longer exists. In Higgins v Nicol (No 2) (1972) 21 FLR 34 at 57 - 58, Joske J recognised that negotiations to settlement are part of the ordinary course of the conduct of litigation. His Honour reached a conclusion similar to that I have reached. In that case the costs of counsel incurred in a bona fide attempt to settle the action were allowed as party and party costs, where that attempt had been unsuccessful.
[2] [2001] FCA 629.
This view has been endorsed by numerous authorities, including Subway Systems Australia Pty Ltd v Ireland (No 2)[3] and Newcastle City Council v Wieland.[4] Importantly, Mansfield J identifies that whether or not the costs of mediation are to be paid as part of an order for party-party costs will depend on the circumstances of the case. In light of this, I consider that in determining whether or not the costs of mediation should be included in the costs payable by the defendant, the fact that there was no formal court order referring the matter to mediation is only one factor to be taken into consideration.
[3] [2013] VSC 693.
[4] [2009] NSWCA 113.
Taking into account the other circumstances of the case, I am of the view that the costs of the mediation have been dealt with by the mediation agreement, and do not fall within the costs agreement set out in the formal offer.
The plaintiff submitted that the mediation agreement was an agreement between the parties and mediator, but not agreement between the parties themselves. On any reading of the document, this cannot be accepted. Firstly, it is clear that the parties agree as between themselves to be bound by the terms of the agreement, on the basis that the parties to the mediation agreement are said to be the parties to the dispute. Indeed, the agreement is one between the parties, to appoint the mediator on certain terms and conditions. The opening sentence of the agreement makes this clear:
The parties to this agreement appoint Ian Callinan (the Mediator) to mediate the dispute described in Schedule 1 (the Dispute) and to negotiate in good faith with a view to achieving its resolution. [5]
[5] Exhibit AJB 3 to FDN 85.
It is an agreement between the parties to appoint the mediator, and to mediate between themselves on certain terms, not primarily an agreement between the mediator and each party on an individual basis.
The costs of the parties of the mediation is dealt with by Clause 12, as set out above. The plaintiff contends that on the true construction of the agreement, this means that, if the matter resolves at mediation, then the agreement will determine how the costs of the mediation will be paid unless they agree otherwise. In the event that the matter does not resolve at mediation, then the parties’ costs of mediation form part of the costs of the action, that is, they are recoverable as part of a costs order made in favour of the successful party.
The plaintiff further argues that because the costs component of the formal offer was “in respect of the within action”, this broadens the range of the agreement of costs beyond matters which might be regarded as “costs of the action”; the words “in respect of” serve to expand the scope of the costs caught by the agreement, to include those of the mediation.
I do not accept this argument. The effect of the plaintiff’s submission is that Clause 12 should be read as including the words to the effect that the costs of the mediation are to be costs in the cause in the event that the mediation is not successful. This cannot be the case; it changes significantly the nature of the agreement set out in the document. If the plaintiff wished those words to be included in the agreement, he should have inserted them at the time the agreement was made. On no reading of the document signed by the parties can it be construed as having the meaning contended for the plaintiff. Nor do the words of the formal offer assist the plaintiff. “In respect of” is not sufficiently wide to include matters relating to costs where the parties have reached a specific agreement.
By entering into an agreement that specifically addressed the costs of the mediation, the parties have indicated an intention that those costs are to be treated separately to the costs of the balance of the litigation. The formal offer made by the defendant does not cut across this agreement or amount to an “agreement otherwise”; given the specific segregation of the costs of the mediation from the costs of the proceedings generally, a specific agreement between the parties was required to override that agreement. This is consistent with the approach taken by the Court in Mead & Anor v Allianz Australia Insurance Ltd,[6] and in endorsed by Owners – Strata Plan No 61162 v Lipman,[7] where the Court said:
[85] The whole point of the decision in Mead is that the parties’ mediation agreement, on its proper construction, recorded the intention and agreement of the parties that the costs of the mediation should be treated as separate from the costs of the proceedings.
[6] [2007] NSWSC 500.
[7] [2014] NSWSC 622.
I conclude, therefore, that while the costs of the mediation would ordinarily fall within the costs of the proceeding, the specific agreement between the parties precludes that in this case.
Costs of the plaintiff’s expert report
The defendant submits that it should not be liable for the costs associated with the expert retained by the plaintiff to provide a report. This is on the basis that it was not a reasonably incurred expense because the expertise of the person retained was not appropriate for the subject matter of the claim.
The defendant’s position
The subject of the expert evidence in this matter was the epidemiological analysis of various statistical evidence. As the defendant raised this topic in its defence, it obtained the first report, being from a Dr Kirk, an expert epidemiologist. To provide an answering report, the plaintiff retained a Dr Henstridge, an expert statistician. The defendant says that no weight can be given to Dr Henstridge’s report, because its area of expertise did not address the expertise on which Dr Kirk’s report was based; while Dr Henstridge would be able to opine in relation to statistical issues, he was not qualified to examine those issues from an epidemiological perspective. Thus, as the expertise of the plaintiff’s expert did not match that of the defendant’s expertise, it could not be relied on at any trial of this matter. The defendant further argued that, in any event, the report of Dr Henstridge confirmed the findings of Dr Kirk, and so was of no assistance to the plaintiff.
It was the defendant’s position that, rather than this being a contest between the experts, the lack of congruity between the experts in this matter is clear. The unreasonableness of retaining an expert with the expertise of Dr Henstridge is obvious.
As a result, the defendant should not be required to pay the costs associated with this report.
The plaintiff’s position
The plaintiff objected to the defendant’s position on the basis that it relied on two basic misconceptions. The first of these misconceptions is that Dr Kirk’s expertise “trumps” Dr Henstridge’s expertise. The second is that Dr Kirk’s evidence would inevitably have been preferred at trial.
It is the plaintiff’s position that it was a reasonable forensic decision to retain Dr Henstridge to attack the statistical analysis of Dr Kirk. It was justified on the pleadings, and on the basis of Dr Kirk’s report. Once this is accepted, then the costs in relation to the report must be allowed. To do anything else would result in a “mini trial” of the experts to determine which would have been preferred.
Consideration
An epidemiologist (among other things) studies the incidence and distribution of disease and illness in a particular population. The analysis performed by an epidemiologist is often done with a view to determining the cause of the outbreak of a particular disease and to formulating strategies to treat the current outbreak and to prevent future outbreaks. A statistician uses mathematical formulae to analyse data to be used in answering and addressing specific questions and problems. It is the contention of the defendant that in the circumstances of this matter, it was not reasonable to employ the expertise of a statistician.
There is clear authority for the proposition that a costs respondent is not required to pay the costs related to an expert whose evidence is found to be wholly irrelevant. In Smiths’ Snackfood Company Ltd v Chief Commissioner of State Revenue (NSW),[8] Gleeson JA said the following:
[221] Whilst the rejection of part of the evidence of a witness would not necessarily result in any discount in the award of costs, or indeed an adverse costs order against a successful party, the rejection of the whole of an expert’s report on the ground of relevance is, in my view, in the circumstances of this case, a sufficient reason to discount the award of costs in favour of Smith’s as the successful party below, to exclude the costs of Mr Feil’s report.
[8] [2013] NSWCA 470.
Conversely, the mere fact that the Court does not accept the evidence of a particular expert, or prefers the evidence of one expert over another, does not necessarily lead to the result that the costs of the expert who was not accepted should not be allowed. As the Full Court of the Federal Court said in Australia and New Zealand Banking Group Limited v Paciocco:[9]
[12] We do not think that it was improper or in any way unnecessary for the Bank to retain Dr Jenkins or that her evidence was not, on the face of it, relevant to a matter in issue between the parties. We do not think that the fact that ultimately her evidence was not relied on by the primary judge means the costs of retaining Dr Jenkins should be excluded from the costs order in favour of the Bank.
[9] [2015] FCAFC 78.
Thus, the question to be determined is whether it was reasonable for the plaintiff to engage Dr Henstridge to provide an expert report in this matter. If this question is determined in favour of the plaintiff, then there is no room for examining which expert would be accepted by a trial judge.
The need for expert evidence arises on the pleadings in the third defence where the defendant pleads as defence of justification as follows:
19.The defendant further says in answer to the whole Statement of Claim that insofar as it may be found that the matters complained of were published by the defendant and identified the plaintiff in his personal capacity (which is denied) and to be defamatory of him in their natural and ordinary meaning or as bearing any other meanings which are defamatory (which is denied), the matters complained of were true or substantially true in substance and in fact.
20.There was sufficient epidemiological evidence in the defendant’s possession which supported a conclusion that some of Vili’s Custard Berliners were contaminated with Salmonella. This evidence was:-
20.1 In the week leading up to 28 January 2011, twenty-three cases of Salmonella Typhimurian phage type 9 (STm9) had been reported;
20.2 The Communicable Disease Control Branch (CDCB) of the Department of Health commenced an investigation pursuant to its powers under the Public and Environment Health Act 1987;
20.3 The investigation was conducted by CDCB staff interviewing those people who had been infected with STm9 and obtaining details about what they had eaten over the seven days before they became ill and where they purchased food from;
20.4 By 28 January 2011 eight interviews had been conducted and two people had reported eating Vili’s Custard Berliners;
20.5 By 30 January 2011, fifteen people had been interviewed and four of these reported eating Vili’s Custard Berliners;
20.6 On 1 February 2011 CDCB received a further report of seven cases of individuals experiencing gastrointestinal illness after consuming Vili’s Custard Berliners at a staff workplace donut day. All the food for the day had come from Vili’s;
20.7 By 4 February 2011 fifty-eight people reported eating a custard Berliner in the week before they became ill. Of these fifty-eight people, twenty-eight people reported eating Vili’s Custard Berliners in the week before they became ill;
20.8 On 4 February 2011 a case-controlled analysis was conducted which found that a person diagnosed with STm9 was thirty-eight times (the “odds ratio”) more likely to have eaten a Vili’s Custard Berliner compared to a healthy person;
20.8.1In the alternative, the defendant says that regardless of the exact odds ratio, there was a very strong statistical significance between people who ate a Vili’s custard Berliner and those who were confirmed as being infected with STm9.
20.9 By 17 March 2011, a total of forty-four people who had tested positive to STm9 had eaten Custard Berliners in the week before they became ill. Of these forty-four, nineteen reported eating Vili’s custard Berliners;
20.10 Approximately forty percent of the persons infected with STm9 during this period required hospitalisation which was about double the rate since 2005.
20.11 Vili’s was at all material times co-operative with the defendant and its delegates, servants and agents in that it:-
21.1 voluntarily ceased production of custard Berliners at the defendant’s request; and
21.2 permitted the defendant to take samples from its factory for testing.

Specifically, the defendant sets out the epidemiological evidence on which it relies, which includes within it statistical analysis as to the likelihood of an affected person having consumed the plaintiff’s product.
Dr Kirk was asked to express his opinion on (amongst other things) the nature of the investigation carried out by the defendant in relation to the salmonella outbreak the subject of this action, and to consider whether the epidemiological statistical analysis relied on by the defendant provided a reasonable basis for the actions of the defendant. In his report dated 10 August 2015,[10] he explains the methodology used by epidemiologists generally and the concept of the odds ratio.[11] He then goes on to discuss the methodology specifically used by the defendant in investigating the outbreak in issue. Dr Kirk was supportive of the methodology used by the defendant, expressed the view that it accorded with best practice, and that the data available was analysed and interpreted correctly by the defendant.[12] As to the odds ratio, he expressed the view that an odds ratio greater than 5.0 would indicate a strong association between the disease in question and the product the subject of the study. He accepted the defendant’s calculation of the odds ratio as 38.[13]
[10] ER-1 in the Joint Bundle of Expert Reports provided by the parties.
[11] See in particular Part II.10.
[12] See Part V.
[13] [12.20] of ER-1.
Dr Henstridge conducts an analysis of the data and statistical method employed by Dr Kirk and the defendant. He is critical of their methodology, and of their interpretation of the statistics they generated. In particular, he discusses the methodology used, but does not discuss the fact that the investigation occurred during an outbreak of disease, rather than in an academic setting, and whether such an investigation would lead to or justify a change in methodology. He finds an odds ratio of 16.3, which is significantly lower than that found by Dr Kirk. Notably, Dr Henstridge does not comment on the epidemiological discussion and conclusions of Dr Kirk, only on the statistical analysis.[14]
[14] ER-2 in the Joint Bundle of Expert Reports provided by the parties.
Dr Kirk then provides a further report in answer to Dr Henstridge’s report.[15] Dr Kirk expresses the view that “statistical methods are integral to analysis of epidemiological data” but notes that “assessing causation comprises more than statistics alone”. [16] He further makes the point that epidemiological investigation undertaken during an outbreak of disease is very different to an investigation undertaken in an academic setting. As to the difference in odds ratio between the defendant and Dr Henstridge, he says:
5.2.What is most important is not the exact number of the odds ratio, but the strength of the association. In this instance, both the odds ratio of 38 estimated by SA Health and 16.3 for Vili’s custard Berliner and 46.9 for custard Berliner of unknown source from Dr Henstridge’s analysis were statistically significant and indicate a very strong association with S. Typhimurium 9 infection.
[15] ER-3 in the Joint Bundle of Expert Reports provided by the parties.
[16] [3.1] of ER-3.
Thus his point is, whether the Court were to accept the defendant’s odds ratio or the plaintiff’s, the association between the product and the disease outbreak was very strong. The effect of Dr Kirk’s report in reply is that, firstly, Dr Henstridge has not taken into account all relevant factors in reaching his views (namely he has not considered the epidemiological aspects of the matter, only the pure statistical elements), and in any event, his conclusion supports the actions taken by the defendant. It is this second element that the defendant described as “scoring an own goal”.
It is on this basis that the defendant contends that the plaintiff should not be entitled to recover the costs associated with Dr Henstridge’s report, on the basis that they were unreasonably incurred.
It is true to say that the reports of Dr Henstridge and Dr Kirk are not entirely ad idem, in terms of subject matter. I do not agree, however, that this should preclude the plaintiff from recovering the costs associated with Dr Henstridge’s report. Statistical analysis is a significant component of Dr Kirk’s analysis. While it may be the case that at trial, a Court would find that Dr Henstridge’s failure to address the epidemiological aspects of Dr Kirk’s opinion was fatal to the acceptance of his opinion, that is not to say that an attack merely of the statistical analysis was unreasonable. I think the same may be said of the defendant’s “own goal” argument. While from an epidemiological basis, the correlation between product and disease may be regarded as significant, whether the odds ratio is 16.3 or 38, it would ultimately be for the Court to decide whether this has any legal impact on the defendant’s defence of justification.
The plaintiff is entitled to claim the costs associated with Dr Henstridge’s report.
Costs of interstate counsel
For a period of time, the plaintiff briefed counsel resident in Adelaide. From 2 April 2014 until the settlement of the matter, the plaintiff briefed senior counsel based in Sydney and from 28 July 2016 to 4 November 2016 junior counsel resident in Sydney. The defendant has objected to the payment of any costs and expenses incurred by virtue of the fact that counsel resided interstate.
The defendant’s position
It is the defendant’s position that the plaintiff is unable to claim the costs associated with retaining interstate counsel, to the extent that those costs exceeded the costs that would have been incurred if local counsel had been retained. It says that in the absence of any evidence as to why it was necessary to brief interstate counsel, any extra expense so incurred should not be borne by the defendant. While the defendant accepts that the counsel briefed by the plaintiff were experts in defamation law, there has been no evidence proffered to suggest that there was no suitably qualified senior counsel within South Australia to accept the brief. The defendant relied on Dalgety Australia Operations Ltd v FF Seeley Nominees Pty Ltd (N0 2) (Dalgety)[17] and Charlick. The defendant says that the relevant test is whether a litigant of ordinary prudence would reasonably have incurred that expense to ensure a proper presentation of their case.
[17] (1988) 49 SASR 75.
The plaintiff’s position
The plaintiff’s position is that the test put by the defendant is not correct, and sets the bar too high. He says the proper question to ask is whether it was reasonable for a litigant in the position of the plaintiff to engage interstate counsel.
The plaintiff relied on two grounds in support of this submission. Firstly, he suggested that Dalgety should no longer be relied on because the practice of law has changed so substantially since it was decided. It has become commonplace in the twenty-first century for practitioners to practise on a regular basis in more than one jurisdiction, thus no distinction should be made in relation to claimable costs, whether counsel was based locally or interstate.
Secondly, the plaintiff argued that, where one party was the State, it was not unreasonable to brief counsel from another jurisdiction. The plaintiff did not elaborate on this ground.
Consideration
I consider that Dalgety remains good law in this state. It was applied by Mansfield J in Charlick and more recently, by Judge Dart in BHP Billiton Ltd v Parker (No 2).[18] In Dalgety, Bollen J put it this way:
If it can be said that it was necessary for the attainment of justice for Mr Ellicott or some such other counsel as I have mentioned, having chambers out to Adelaide, be briefed and that such briefing was not an exercise of over-caution or something producing payment of unusual fees than at least many of the items challenged should be allowed.[19]
[18] [2014] SASC 6.
[19] (1988) 49 SASR 75 at 82.
In answering the question in the matter before him, Bollen J then said:
The reasonably prudent litigant at the time of delivering the brief would not have thought it necessary for the attainment of justice or (under the 1947 Rules for defending his rights) to brief counsel from another State or city. In fact it was quite unnecessary for the defendant to have done so. There were plenty of Queen’s Counsel in Adelaide who could have attained justice for the defendant and defended the defendant’s rights.[20]
[20] (1988) 49 SASR 75 at 83.
In Charlick, the defendant sought to claim the expenses associated with briefing interstate junior counsel. A number of reasons were given for the need to brief a barrister from interstate. In addressing those reasons, Mansfield J said the following:
[39] Mr Travers accepts that it was also appropriate to allow, on a party and party basis, the additional costs associated with briefing interstate junior counsel. I deal with his six stated reasons for that view seriatim. In my view, it does not follow from the acceptance by Charlick that it was appropriate to retain solicitors based in Canberra that it was also appropriate to engage interstate counsel based elsewhere than in Canberra. The initial retainer to Mr Sulan QC evidenced the fallacy of the proposition. The fact that the Court exercises federal jurisdiction, and that litigants may retain counsel from anywhere in Australia is plain. It does not follow that the decision of a litigant to do so carries with it the assumption that, for the purposes of party and party taxation, it was necessary or proper to do so. To include the assertion that "in proper circumstances" that additional cost may be recoverable on a party and party taxation does no more than arguably state the relevant proposition of law; it does not address the particular circumstances. Thirdly, he refers to the opinion of Mr Weber that suitable counsel could not be retained in Adelaide. I have referred to Mr Weber's evidence as it was referred to me in submissions. It does not deal with the availability of junior counsel. The assumption underlying that reason of Mr Travers is not made out. Fourthly, Mr Travers refers to the efficiency which would follow from the closer proximity of Sydney to Canberra, and to the location of NRC's head office and a number of its witnesses in Sydney. I do not consider that that general claim, without detailed explanation, is sufficient to determine that the engagement of interstate junior counsel was necessary or proper for the purposes of party and party taxation. It would require detailed evidence of the claimed efficiency, having regarding to the role of junior counsel, before such a proposition would be persuasive. There is no analysis of the relative cost efficiency of junior counsel based in Adelaide travelling interstate to the extent that that was necessary or proper. Mr Travers next refers to the fact that NRC through its solicitors had briefed senior counsel based in Adelaide, and had therefore demonstrated a willingness to engage local counsel. It does not follow that it had been unable to retain suitably experienced local junior counsel. As I have noted, Mr Weber does not assert any such inability in the material to which I was referred. Finally, Mr Travers refers to the fact that senior counsel retained by NRC was based interstate. Again, I do not consider that that fact alone, or without further explanation, warrants the conclusion that it was necessary or proper for the purposes of party and party taxation to retain junior counsel not located in the State where the proceedings were conducted.
[40] I am therefore of the view that, for the purposes of party and party taxation, the additional fees, costs and expenses associated with the retention of junior counsel based interstate should not be allowed.
It is worth noting that his Honour found that even in a Court exercising Federal jurisdiction, the retention of counsel from interstate would not be regarded as necessary and proper in all circumstances.
Unlike in Charlick, the plaintiff in this matter has proffered no reason for the briefing of interstate counsel, other than that it was reasonable because the State was a party to the litigation. I do not understand what is meant by this submission. It cannot be the case that the plaintiff is suggesting that there would (or might be) be adverse consequences for the barrister retained, if he or she chose to act against the State. The State is a party in many pieces of litigation, both as plaintiff and defendant, in which local counsel, both senior and junior, is frequently briefed. I see no reason why the status of the State as a party should have any bearing on the choice of counsel, particularly in a situation where the State has chosen to brief in-house counsel, thus leaving the entirety of the private bar at the disposal of the plaintiff.
Whether the test is that it was necessary for the attainment of justice for the plaintiff to brief interstate counsel, or whether it is somewhat less rigorous, and must merely be necessary and prudent as put to me by the plaintiff, on neither test has the plaintiff reached the threshold necessary to make the defendant liable for the costs associated with interstate counsel. No cogent reason has been put to me to satisfy me that it was necessary and prudent to brief interstate counsel in this matter.
The plaintiff is not entitled to claim the costs associated with engaging interstate counsel from the defendant.
Conclusion
In summary, I determine the preliminary points in the following way:
1The plaintiff is not entitled to claim the costs associated with the mediation before the Honourable Ian Callinan AC QC.
2The plaintiff is entitled to claim the costs associated with Dr Henstridge’s report.
3The plaintiff is not entitled to claim the costs associated with the engaging of interstate counsel.