Polleycutt v Taylor (No. 2)
[2020] ACTSC 321
•1 December 2020
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Polleycutt v Taylor (No. 2) |
Citation: | [2020] ACTSC 321 |
Hearing Date: | 11 November 2020 |
DecisionDate: | 1 December 2020 |
Reasons Date: | 2 December 2020 |
Before: | McWilliam AsJ |
Decision: | See [43] |
Catchwords: | PRACTICE & PROCEDURE – COSTS – Referral of assessment – whether fixed sum costs order appropriate |
Legislation Cited: | Court Procedures Rules 2006 (ACT) rr 1720, 1726, 1734, 1751, 1753, 1754 |
Cases Cited: | Andara Homes Pty Limited v Nicholas Palm and Ling Jiang [2014] ACTSC 141 Beach Petroleum NL v Johnson (No 2) [1995] FCA 1250; 57 FCR 119 Polleycutt v Taylor [2020] ACTSC 158 |
Parties: | Eric Polleycutt (Appellant) Aleah Taylor (Respondent in proceedings SCA 69 of 2017) Lisa Aldcroft (Respondent in proceedings SCA 84 of 2017) William Aldcroft (Respondent in proceedings SCA 85 of 2017) |
Representation: | Self-Represented (Appellant) Self-Represented (Respondent in proceedings SCA 85 of 2017) |
File Numbers: | SCA 69 of 2017, SCA 84 of 2017, SCA 85 of 2017 |
Decisions under appeal: | Court: ACT Magistrates Court Before: Special Magistrate Cush Date of Decision: 27 July 2017 Case Title: Polleycutt v Aldcroft; Polleycutt v Taylor File number: RO 249 of 2017 Court: ACT Magistrates Court Before: Magistrate Theakston Date of Decision: 20 September 2017 Case Title: Polleycutt v Aldcroft; Polleycutt v Taylor File numbers: RO 105 and 107 of 2017 |
McWilliam AsJ:
On 5 July 2019, judgment was delivered in respect of three appeals brought by the appellant, Mr Eric Polleycutt, from orders made in the Magistrates Court of the Australian Capital Territory: see Polleycutt v Aldcroft [2019] ACTSC 174 at [72]. The appeals concerned a dispute between neighbours. The respondents to the appeals were Mrs Lisa Aldcroft and Mr William Aldcroft, and their daughter, Ms Aleah Taylor, who has a disability.
Relevantly, the appellant was ordered to pay Mr and Mrs Aldcroft’s costs of the appeal against each of them (in proceedings SCA 84 of 2017 and SCA 85 of 2017), and 85% of Ms Taylor’s costs of the appeal against her (in proceedings SCA 69 of 2017). The present issue before the Court is the determination of the quantum of those costs payable.
Following the delivery of judgment, the respondents sought to have the costs assessed. That assessment process was commenced through the filing of a Bill of Costs on 17 December 2019 in respect of all three matters. The Bill of Costs claims $13,788.56 in costs and disbursements. Although the respondents have been self-represented since 6 November 2018, the Bill of Costs relates to work performed by Capital Lawyers before that date.
On 4 March 2020, the costs assessment came before the Registrar (in this case, acting through Senior Deputy Registrar Kennealy). On that occasion, the costs assessment was adjourned to 13 May 2020, with the appellant given a further opportunity to file and serve any objections to the Bill of Costs within 21 days.
The appellant did not complete that task and instead provided medical certificates in March, May and August 2020, which formed the basis of an application to adjourn the costs assessment. That application was granted by the Registrar and the costs assessment was adjourned to 12 November 2020, although that date then appears to have been amended to a day earlier, being 11 November 2020.
On 8 October 2020, Mr and Mrs Aldcroft filed identical Applications in Proceedings in both SCA 84 of 2017 and SCA 85 of 2017 seeking orders to the effect that the costs assessment proceed and that no further adjournments be granted based on the medical evidence previously provided. Those Applications in Proceedings came before the Court on 16 October 2020 and there was no appearance by the appellant on that occasion. The applications were adjourned to 11 November 2020, when the costs assessment process was also to be resumed. If the costs assessment had proceeded before the Registrar, the Applications in Proceedings would become unnecessary.
On 11 November 2020, the Registrar attempted to progress the costs assessment. The appellant was not ready to proceed and sought a further adjournment. The Court record discloses that no further medical certificate was provided. At that point, the costs assessment process was referred to me as duty judge along with the adjourned Applications in Proceedings.
Should the Court make a fixed costs order?
On 11 November 2020, I raised with the parties the alternative course of the Court proceeding to fix an amount for costs, rather than continuing along the more detailed and labour-intensive path of having the costs assessed by the Registrar. Provision is made for such an order under r 1720(3)(c) of the Court Procedures Rules 2006 (ACT) (the Rules).
The applicable (but non-exhaustive) principles as to when such an order may be considered to be appropriate are set out in Polleycutt v Taylor [2020] ACTSC 158 at [8]. Without reciting again the authorities from which these principles are drawn, consideration should be given to whether a fixed costs order may avoid the expense, delay and aggravation involved in protracted litigation arising out of a costs assessment. Examples of where it may be appropriate to make a fixed sum costs order include:
(a) Where the party required to pay the costs is unlikely to be able to do so due to his or her financial position.
(b) Where a party has delayed or otherwise failed to ensure an expeditious and efficient disposal of the litigation, as this may well indicate that a protracted process of a costs assessment would be unreasonable to impose on the party entitled to the costs.
(c) Where the matter itself is a simple one, to save the parties the difficulties and inconvenience of a costs assessment process.
All of these considerations very much favour a fixed sum order being made in the present proceedings. The Bill of Costs was filed almost a year ago. There has been ongoing delay. This was partly due to the ill health of the appellant, and there is no criticism of him in that regard. However, the fact of the ongoing delay means that it is now very much in the public interest (from the perspective of the finality of the litigation) that the costs component of the proceedings be resolved as between the parties, as expeditiously as possible. The appeal proceedings were also relatively straightforward, so that the protracted costs assessment process has become a disproportionate burden on each party.
Accordingly, as discussed with the parties during the hearing, this is a clear case where it is appropriate for the Court to make a lump sum costs order in lieu of an assessment of costs.
What amount is appropriate?
Applicable principles
As to how to approach the task of fixing a gross sum costs order, I have applied the following principles (which were set out in Polleycutt v Taylor at [10] but are repeated here for convenience):
(a) A gross or lump sum order is not the result of a process of assessment of costs. The Court does not undertake the detailed scrutiny normally reserved for formal assessments. The lump sum can only be fixed broadly, having regard to the information before the Court: Beach Petroleum NL v Johnson (No 2) [1995] FCA 1250; 57 FCR 119 (Beach Petroleum) at 124; Ginos Engineers Pty Ltd v Autodesk Australia Pty Ltd [2008] FCA 1051; and Harrison v Schipp [2002] NSWCA 213; 54 NSWLR 738 at [22]; cited in Andara Homes Pty Limited v Nicholas Palm and Ling Jiang [2014] ACTSC 141 (Andara Homes) at [49].
(b) The evidence relating to the costs sought must be sufficiently detailed and must clearly identify the components of the costs incurred and how they have been calculated: Motor Trades Association of Australia Superannuation Fund Pty Ltd v Rickus [2007] FCA 1878 at [26].
(c) To ensure that a weaker party is not disadvantaged by a lump sum costs order, the Court may adopt a careful and conservative approach to fixing the costs: Dunstan v Seymour [2006] FCA 917 at [25].
(d) The Court must be astute to prevent prejudice or injustice, either to the party ordered to pay the costs (by overestimating the costs), or to the successful party (by adopting an arbitrary “fail safe” discount on the cost estimates before the Court): Beach Petroleum at 124; cited in Andara Homes at [49].
(e) The Court may take into account that the costs should bear some relationship to the size of the applicant’s victory and should be proportionate to the nature and importance of the case: Canvas Graphics Pty Ltd v Kodak (Australasia) Pty Ltd [1998] FCA 23.
The parties’ submissions
The arguments of the parties may be summarised as follows.
At the outset, Mr Polleycutt submitted that he has no ability to pay any costs order, whatever its quantum.
With regard to the rates charged in the Bill of Costs by the respondents’ solicitor, Mr Polleycutt submitted (as I understood the argument) that the solicitor fee rate appeared to have been charged at a rate for someone with a greater level of experience than that possessed by the particular solicitor involved when the appeal proceedings were initially commenced.
In addition, the scale fee for each item that has been charged purportedly pursuant to Sch 4 of the Rules exceeded that which was permitted to be charged at the time the work was carried out. Schedule 4 of the Rules was amended to increase a number of fees, with the amendment commencing on 1 July 2019, after the appeals had been heard. Mr Polleycutt submitted that the entire Bill of Costs was prepared using the increased fee rates and is therefore overstated.
With regard to the subject matter of the Bill of Costs, Mr Polleycutt contended that a substantial part of the Bill of Costs related to applications by Mr and Mrs Aldcroft in proceedings SCA 84 of 2017 and SCA 85 2017 to strike out the appeal proceedings. Those applications were dismissed on 17 July 2018 and a costs order was made in Mr Polleycutt’s favour. Further, as the solicitor on the record for the respondents withdrew from the proceedings shortly after, the overwhelming part of the costs are not payable by Mr Polleycutt.
In a similar vein, Mr Polleycutt submitted that a portion of the costs related to an argument about security for costs that was unsuccessful. Mr Polleycutt submitted that it is not reasonable for him to pay the costs of an argument that he effectively won.
Throughout the proceedings, there were also a number of interlocutory listings where the Registrar reserved the question of costs. Mr Polleycutt submitted that he should not be liable for those costs.
With regard to the complexity of the matter and the nature of the evidence, Mr Polleycutt submitted that at the hearing, only one affidavit was relied upon by each respondent. The costs are therefore disproportionate to the complexity of the proceedings and the evidence relied upon.
A portion of the costs itemised in the Bill of Costs related to the preparation of an index for the appeal papers. Mr Polleycutt submitted that as this index was never finalised and sent, it is unreasonable to make him pay for that work being undertaken.
A number of items of the Bill of Costs refer to an issue between the parties about a litigation guardian being appointed for Aleah Taylor. In the appeal proceedings, that issue was resolved in Mr Polleycutt’s favour and therefore Mr Polleycutt submitted that he should not have to pay for expenses incurred relating to that issue.
Mr Polleycutt further submitted that the Bill of Costs frequently refers to a document being amended. The Rules provide that when a party amends a document, that party must pay the costs thrown away by the amendment. I have taken that submission as one being directed to r 1726, the terms of which are as follows:
Costs—amendment of documents
(1)This rule does not apply to a party who amends a document because of another party's amendment or default.
(2) A party who amends a document must pay the costs of and caused by the amendment, unless the court otherwise orders.
Mr Polleycutt is aware of a number of other proceedings involving Mr Aldcroft as a litigant, and the solicitor previously instructed in the appeals was also dealing with those matters. Mr Polleycutt was concerned that the Bill of Costs has included time spent dealing with those matters, or to put it another way, the Bill of Costs does not make it clear through the descriptions given that time spent on other matters has not been included (either inadvertently or otherwise).
The Bill of Costs has been structured so that it purports to separate out costs of the appeal against Ms Taylor from those relating specifically to the appeal against Mr and Mrs Aldcroft. Mr Polleycutt submitted that he should not be liable to pay the costs in relation to Ms Taylor’s matter at all.
With regard to the disbursements itemised, Mr Polleycutt submitted that it is not clear what they are for. He said the respondents have not established a proper basis for those charges. He has requested Capital Lawyers for details of the disbursements but has not been provided with any more specific breakdown. He has also sought copies of all invoices issued in respect of all three proceedings and any proof that the legal costs have actually been paid.
In all the circumstances, Mr Polleycutt submitted that the Bill of Costs does not represent the respondents’ “fair and reasonable costs”, being the words used in r 1751. Mr Polleycutt drew attention to rr 1753 and 1754 of the Rules, under which the Registrar has the power to disallow any costs that have been incurred as a result of conduct that is considered improper, vexatious or unreasonable, or alternatively where there is certain conduct of a legal practitioner that has resulted in the incurring of costs, such as failing to file documents or misconduct or negligence on the part of the practitioner. In the present case, he submitted that a portion of the legal costs claimed are affected by failures attributable to the respondents’ solicitor (including delay, wasted costs and failure to comply with orders), and that he should not be ordered to pay those costs.
Mr Aldcroft made submissions on behalf of the respondents. He essentially relied on the Bill of Costs that had been prepared as being the fair and reasonable costs of the proceedings. He strongly opposed any suggestion that the Bill of Costs included anything other than work done in respect of the three matters the subject of appeal proceedings.
The Bill of Costs divides the costs claimed into two categories, the first being the appeal costs for the appeals against himself and his wife, and the second being the appeal proceedings against Ms Taylor. Mr Aldcroft accepted that at times, there did appear to be references to matters specific to Ms Taylor’s appeal included in the first category, rather than in the second category.
Consideration
I have carefully reviewed the Bill of Costs filed 17 December 2019, and I find as follows.
The charge out rates are overstated. They refer to the rates applicable in Sch 4 to the Rules as at the date the Bill of Costs was filed, rather than the rates that applied when the work was done. Assuming without deciding that Mr Polleycutt is correct in terms of an inexperienced solicitor initially performing the work, I am not satisfied that it is relevant here, where the Bill of Costs has been prepared according to scale.
A significant portion of the work done up to 17 July 2018 relates to costs of unsuccessful applications to strike out the appeal proceedings. These included $1,122.80 on 15 February 2018, $1,000 (approximately) in March 2018, following the filing of the applications in proceedings on 20 March 2018, for a hearing that occurred before Elkaim J on 23 March 2018, and a further $2,105.25 on 17 July 2018. The orders of the Court were as Mr Polleycutt submitted, namely that a costs order was made in his favour following the dismissal of the strike out applications. Accordingly, the costs referrable to those applications are not recoverable on assessment.
With regard to any costs for issues otherwise resolved in Mr Polleycutt’s favour, there have been no separate costs orders made and this was not a case where it was appropriate for the Court to order that a discrete aspect of the proceedings be carved out of any final costs orders.
With regard to Ms Taylor’s costs, there appears to have been some confusion at the hearing in that regard (as to whether they were before the Court for assessment). This is understandable given that all parties were self-represented. Having reviewed the orders made and set out above, and the Bill of Costs which was filed in each of the three proceedings, the costs assessment process does include Ms Taylor’s costs on appeal. It is simply that Mr Polleycutt was only ordered to pay 85% of Ms Taylor’s appeal costs.
There are some references in the description of the work charged in the appeal proceedings against Mr and Mrs Aldcroft to work that is clearly referable to the appeal proceedings against Ms Taylor (for example, references to matters concerning the appointment of a litigation guardian) and Mr Aldcroft accept that the amounts charged for those items should have been recorded as part of Ms Taylor’s costs, albeit those amounts are small.
This has relevance for the quantum of costs, because the figures charged which are specifically referable to proceedings SCA 69 of 2017 should reflect a reduction of 15% on assessment, pursuant to the orders of the Court. The Bill of Costs does not take account of that fact, but when the Court is fixing the sum, the terms of that order must be applied.
It is true that the solicitor on the record is taken to have withdrawn from the appeal proceedings on 6 November 2018, when notices that each party was now self-represented were filed. However, apart from the costs of preparing the Bill of Costs, all the legal costs incurred were prior to that date. I do not accept that almost the entirety of the work recorded in the Bill of Costs is referable solely to the strike out applications. There was plainly legal work done prior to the determination of those applications on 17 July 2018 that was also relevant to the substantive appeal proceedings. In addition, approximately $1,400 was incurred after those hearings.
As to the remainder of the arguments, the Bill of Costs does have some deficiency in detail, in terms of general references to time engaged in conferences, drafting email correspondence and references to telephone calls. While this might give rise to concerns about work being done on other matters and inadvertently charged to the wrong file, there are sufficient references to the ‘Supreme Court proceedings’ in the itemised descriptions to support the position that the costs recorded were properly incurred in the appeal proceedings and not in unrelated proceedings in other forums.
With regard to r 1726 of the Rules and the amendment of documents, that rule has no application to the Bill of Costs. Although it is not explicit, the rule plainly applies to documents that have been served, and then subsequently amended. Where a solicitor amends a document such as an affidavit or a letter as part of the drafting and finalising process before it is filed and served on another party, the costs are properly part of the reasonable costs of proceedings. To explain the rule another way, if a document has not been served, no time can have been spent by an opponent considering it. Further and in any event, as Mr Polleycutt was unrepresented throughout the entirety of the appeal proceedings, there are no legal costs thrown away by any amendments to documents.
There is no basis for any order with regard to the application of r 1753 of the Rules. I am not satisfied on the evidence presently before the Court that there was any unreasonable conduct by the legal representative for the parties. This includes the preparation of an index that Mr Polleycutt contends was never finalised. The Court record confirms that such an index was reasonably prepared in compliance with directions made on 17 July 2018. The fact that the parties did not reach the point of agreement on an index in order for it to be finalised does not detract from the reasonableness of the work being done.
I consider $7,000 to be a figure that takes appropriate account of the matters to which I have referred. While this is not a mathematical process, these include a reduction of approximately $4,500 for work that was charged in relation to the two unsuccessful strike out applications, a blanket reduction across the entirety of the Bill of Costs due to the incorrect scale being used, and a reduction of 15% in relation to Ms Taylor’s costs of the appeal. I have determined that approximately $1,000 is an appropriate figure by way of reasonable disbursements, the majority of which relate to photocopying and the cost of drawing the Bill of Costs (recoverable pursuant to r 1734 of the Rules).
I have otherwise been mindful to adopt a careful and conservative approach to fixing the costs. While the result may be lower than that which would have been achieved if the parties had continued down the path of a costs assessment, the amount is relatively minor, and may be seen as the price to pay for having certainty on quantum earlier.
Conclusion
For the above reasons, the Court makes the following orders:
(1) Pursuant to r 1720(3)(c) of the Court Procedures Rules 2006 (ACT), the respondents’ costs in proceedings no. SCA 69 of 2017, SCA 84 of 2017 and SCA 85 of 2017 are fixed in the sum of $7,000.
| I certify that the preceding forty-three [43] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Associate Justice McWilliam. Associate: Date: |
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