Nicholson v Morgan [No 3]
[2013] WASC 110 (S)
•24 APRIL 2013
NICHOLSON -v- MORGAN [No 3] [2013] WASC 110 (S)
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2013] WASC 110 (S) | |
| Case No: | CIV:2491/2010 | ON THE PAPERS | |
| Coram: | EDELMAN J | 24/04/13 | |
| 6 | Judgment Part: | 1 of 1 | |
| Result: | Special costs orders made | ||
| B | |||
| PDF Version |
| Parties: | PAUL DOUGLAS NICHOLSON AND THE OTHER PERSONS NAMED IN THE FIRST SCHEDULE MATTHEW CAMPBELL MORGAN STEFAN OTTO ALTERUTHEMEYER MACLMA PTY LTD LESLIE ALLAN STEIN SATTVIC PTY LTD as trustee for The Stein Super Fund MIRIAM JEANETTA STEIN NATIONAL AUSTRALIA BANK |
Catchwords: | Costs Special costs order Legal Profession Act 2008 (WA), s 280(2) Whether costs should include costs of two counsel Whether Scale limit should be removed |
Legislation: | Legal Practitioners (Supreme Court) Contentious Business) Costs Determination 2012 (WA) Legal Profession Act 2008 (WA) |
Case References: | Frigger v Lean [2012] WASCA 66 Heartlink Ltd v Jones As Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254 (S) Nicholson v Morgan (No 2) [2012] WASC 296 Nicholson v Morgan (No 3) [2013] WASC 110 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiffs
AND
MATTHEW CAMPBELL MORGAN
First Defendant
STEFAN OTTO ALTERUTHEMEYER
Second Defendant
MACLMA PTY LTD
Third Defendant
LESLIE ALLAN STEIN
Fourth Defendant
SATTVIC PTY LTD as trustee for The Stein Super Fund
Fifth Defendant
MIRIAM JEANETTA STEIN
Sixth Defendant
NATIONAL AUSTRALIA BANK
Seventh Defendant
Catchwords:
Costs - Special costs order - Legal Profession Act 2008 (WA), s 280(2) - Whether costs should include costs of two counsel - Whether Scale limit should be removed
Legislation:
Legal Practitioners (Supreme Court) Contentious Business) Costs Determination 2012 (WA)
Legal Profession Act 2008 (WA)
Result:
Special costs orders made
Category: B
Representation:
Counsel:
Plaintiffs : No appearance
First Defendant : No appearance
Second Defendant : No appearance
Third Defendant : No appearance
Fourth Defendant : No appearance
Fifth Defendant : No appearance
Sixth Defendant : No appearance
Seventh Defendant : No appearance
Solicitors:
Plaintiffs : Tottle Partners
First Defendant : No appearance
Second Defendant : No appearance
Third Defendant : No appearance
Fourth Defendant : No appearance
Fifth Defendant : No appearance
Sixth Defendant : No appearance
Seventh Defendant : King & Wood Mallesons
Case(s) referred to in judgment(s):
Frigger v Lean [2012] WASCA 66
Heartlink Ltd v Jones As Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254 (S)
Nicholson v Morgan (No 2) [2012] WASC 296
Nicholson v Morgan (No 3) [2013] WASC 110
- EDELMAN J:
Introduction
1 Following my reasons for decision on this strike out application by the seventh defendant (the Bank), orders were made by consent. The parties were given liberty to file submissions and evidence concerning special costs orders sought. Consistently with the plaintiffs' position at the directions hearing that special costs orders were neither consented to nor opposed, the plaintiffs did not file any submissions on this application.
2 As I explained in my reasons for decision in this matter in Nicholson v Morgan (No 3),1 the application with which I was concerned was the second strike out application by the Bank. The first strike out application, which was also successful, was heard by Corboy J, whose decision is Nicholson v Morgan (No 2).2 After making orders striking out the application, Corboy J gave supplementary reasons granting a special costs order sought by the Bank under s 280(2) of the Legal Profession Act 2008 (WA) (the Act). His Honour's special costs order allowed the Bank's costs to be taxed without regard to the maximum limit for item 10(a) of the Legal Practitioners (Supreme Court) (Contentious Business) Costs Determination 2012 (the Scale).
3 Item 10(a) of the Scale provides for the costs of one counsel for proceedings in chambers, with two days of preparation and one day of hearing. The hourly rate of counsel is $363 and the daily rate is $3,630. The total Scale costs provided for is therefore $10,560.
4 On this occasion the Bank seeks special costs orders which are more limited than those sought after the first strike out application. The Bank does not seek to have Item 10(a) of the Scale removed in its entirety. Instead, the Bank seeks orders that:
(a) The seventh defendant's costs of the strike out application dated 14 February 2013 include the cost of two counsel.
(b) The taxing officer have discretion pursuant to s 280(2) of the Legal Profession Act2008 (WA) not to apply the monetary limit on costs (being $10,560) imposed by item 10(a) of the Legal Practitioners (Supreme Court) (Contentious Business) Costs Determination 2012 (WA), but shall otherwise apply the allowances for time permitted by that item.
5 The Bank does not submit that the time provided by the Scale is inadequate. The hearing took a half a day. The issues overlapped with the first application. However, the Bank submits that the monetary limit provided by the Scale, based on provision of a single counsel, is inadequate. The effect of the orders sought by the Bank will be to permit the taxing officer to tax the costs taking into account, if he or she considers it appropriate, (i) the cost of senior counsel and junior counsel; and (ii) without constraint of the Scale limits for the fees for senior counsel and junior counsel.
6 Section 280(2) of the Act provides for a threshold requirement before a special costs order can be made. That threshold is that a court may make a special costs order where it is of the opinion that 'the amount of costs allowable in respect of a matter under a costs determination is inadequate because of the unusual difficulty, complexity or importance of the matter'. This means that there is a fairly arguable case that because of the unusual difficulty, complexity or importance of the matter the bill to be presented to the taxing officer may tax at an amount which is greater than the limit imposed by the Scale.3
7 Although the strike out application on the previous occasion concerned a pleading in different terms, there were a number of common issues raised in each application. On both occasions the essence of the issue concerned was whether the plaintiffs had properly pleaded a cause of action which might broadly be described as knowing assistance in a breach of trust.
8 I am satisfied, for the same detailed reasons given by Corboy J, that it was appropriate for the Bank to be represented by senior and junior counsel and that a limit of only one junior counsel is inadequate. In particular, the nature and seriousness of the allegations against the Bank, and the difficulty and complexity of the issues involved, mean that the amount of costs allowable in respect item 10(a) of the Scale, although not the time limit provided by that Scale item, is inadequate.
9 The remaining issue is whether a higher limit should be imposed, reflecting the Scale rates for senior and junior counsel for up to two days preparation and a half a day of hearing or whether, as the Bank's proposed orders contemplated, the taxing officer should be unconstrained by the Scale rates for senior and junior counsel for that period of preparation and hearing. It may be that in the absence of evidence and submissions on the point it will generally be inappropriate to depart from Scale rates for junior or senior counsel. However, in this case, I consider that the Scale rates for counsel and senior counsel are inadequate (in the sense explained above) taking into account the following matters:
(i) my impressions, knowledge and experience of the case;4
(ii) the previous orders of Corboy J and the evidence before him of counsel's costs; and
(iii) the desirability and benefit of the Bank being represented by the same counsel on the second strike out hearing before me.
10 Special costs orders will be made in the terms set out above in par 4.
1Nicholson v Morgan (No 3) [2013] WASC 110.
2Nicholson v Morgan (No 2) [2012] WASC 296.
3Heartlink Ltd v Jones As Liquidator of HL Diagnostics Pty Ltd (in liq)[2007] WASC 254 (S) [16](Martin CJ).
4 See Frigger v Lean [2012] WASCA 66 [82] (Allanson J; Murphy & Newnes JJA agreeing).
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