Pritchard v Fryer (No 2)

[2018] NSWSC 261

Supreme Court

New South Wales

Medium Neutral Citation:	Pritchard v Fryer (No 2) [2018] NSWSC 261
Hearing dates:	22 February 2018
Decision date:	06 March 2018
Jurisdiction:	Common Law
Before:	Fullerton J
Decision:	1. The plaintiff pay the defendant’s costs on a gross sum basis in the amount of $17,531.46 inclusive of GST.
Catchwords:	COSTS - application for gross sum costs order pursuant to s 98(4) Civil Procedure Act 2005 (NSW) - defendant seeks gross sum costs order following plaintiff's unsuccessful appeal from Local Court - whether appropriate to make a gross sum costs order - quantification of the gross sum to be awarded.
Legislation Cited:	Civil Procedure Act 2005 (NSW).
Cases Cited:	Starr-Diamond v Diamond (No 4) [2013] NSWSC 811 Hamod v New South Wales [2011] NSWCA 375 Harrison v Schipp [2002] NSWCA 213
Category:	Principal judgment
Parties:	Andrew Pritchard (Plaintiff) Gregory Fryer (Defendant)
Representation:	Counsel: In person (Plaintiff) P Sharrock (Defendant)   Solicitors: In person (Plaintiff) In person (Defendant)
File Number(s):	2017/200426

Judgment

1. HER HONOUR: On 16 February 2018 I delivered judgment in proceedings commenced by Summons on 3 July 2017. In dismissing the Summons, I indicated my intention to make an order that the plaintiff pay the defendant’s costs, as agreed or assessed, on the ordinary basis. Counsel for the defendant, Mr Sharrock, sought an order that the defendant’s costs be paid on a gross sum basis pursuant to s 98(4)(c) of the Civil Procedure Act 2005 (NSW). In making that application, Mr Sharrock submitted that if costs were assessed, there was a risk that issues ventilated in the proceedings would be revisited during the costs assessment process.

2. Applications for a gross sum costs order are regularly advanced where the subject matter of the litigation concerns modest sums of money, and where there is a risk of “satellite litigation” if costs are assessed.

3. The purpose of the power to order payment of costs on a gross sum basis is to avoid the “expense, delay and aggravation” which the costs assessment process may give rise (Starr-Diamond v Diamond (No 4) [2013] NSWSC 811 at [8]). Similarly, the discretion to order gross sum costs may be exercised where the assessment would be “protracted and expensive” (Hamod v New South Wales [2011] NSWCA 375 per Beazley JA). The discretion should only be exercised, however, when the Court considers that it can do so fairly between the parties, and that includes [having] sufficient confidence in arriving at an appropriate sum on the materials available” (Harrison v Schipp [2002] NSWCA 213 per Giles JA).

4. In support of the gross sum costs order advanced orally on 16 February 2018, Mr Sharrock furnished a one page tax invoice where his professional costs were specified as $21,450.00. As the invoice did not expose the manner in which the costs were calculated, I was not prepared to make a gross sum costs order in the specified amount and invited Mr Sharrock to provide further and better particulars of his professional costs if the application was to be pressed.

5. On 1 March 2018 the defendant filed an eight page document in the Registry comprising two invoices, together with two receipts for disbursements.

6. I am conscious that any sum ordered to be paid pursuant to s 98(4)(c) should be based on an informed assessment of the actual costs incurred having regard to the available information, and that the estimate of costs should also be “fair, logical and reasonable” (Hamod v New South Wales [2011] NSWCA 375).

7. I have before me an itemised bill of costs which indicates the total cost incurred by the defendant is $21,658.93. The hourly rate at which Mr Sharrock’s professional costs accrue is consistent, in my view, with that charged by counsel with similar experience and the hours committed to preparation for the proceedings in this Court is reasonable in light of the lengthy affidavits upon which Mr Pritchard sought relief and the service of a Notice of Motion within days of the hearing where repeated reference was made to materials which Mr Pritchard sought to have the Court consider.

8. I am not satisfied, however, that the plaintiff ought be required to pay the defendant’s costs on 22 February 2018. Having regard to the brevity of the appearance on that day, and a reasonable estimate of Mr Pritchard’s return travel time, I discount the amount claimed by three hours.

9. Taking this deduction into account, the defendant’s professional costs total $18,375.00, exclusive of disbursements and GST.

10. When assessing costs on a gross sum basis and in the absence of an order that costs be paid on an indemnity basis, a discount should be applied. In determining the discount to be applied, relevant factors include the fact that the defendant compiled the court books with limited assistance from the plaintiff, that the plaintiff sought to raise a multiplicity of issues on the hearing of the Summons and the Notice of Motion filed within a short time of the hearing to which the defendant was required to respond; that the defendant’s counsel was briefed on a direct-access basis which reduced total legal costs but which required additional conferences and travel, and ultimately what I consider to be a reasonable sum claimed by counsel as the ultimate costs incurred by his client. I also note that Mr Sharrock has not furnished an invoice in respect of today’s appearance. In all the circumstances, I consider a reduction of 15 per cent of the defendant’s professional costs is appropriate. This discount is to allow for the likelihood of some reconsideration of materials the subject of proceedings in the Local Court where a costs order has been made in the defendant’s favour.

11. Turning to disbursements, there is no receipt in respect of the claim for accommodation on the night of 31 January 2018 in the amount of $133.10 inclusive of GST. Accordingly, I make no allowance for accommodation. The basis upon which $141.90 was claimed for Mr Sharrock’s travel expenses is unclear. Notwithstanding, I am satisfied that this sum is properly claimed having regard to the fact that Mr Sharrock has Chambers in Newcastle, was required to travel to Sydney on at least four occasions, and that his client is resident in Brookvale and he has attended upon his client on occasion as the matter was under preparation. That claim is allowed in full.

12. I am satisfied that the photocopying expense incurred at Snap Printing, together with the postage expense incurred at Australia Post, were reasonably and necessarily incurred. I allow these claims in full.

13. Having considered the material and the submissions of the parties, I am satisfied that an order should be made pursuant to s 98(4)(c) requiring the plaintiff pay the defendant’s costs on a gross sum basis. I am satisfied that Mr Pritchard’s conduct in bringing these proceedings gives rise to a real risk that “satellite litigation” may occur in respect of costs, and that the costs assessment process could for that reason prove to be protracted and expensive. I am also satisfied the amount of the costs order fairly represents the defendant’s costs incurred in defending proceedings in this Court.

14. Accordingly, I order the plaintiff pay the defendant’s costs on a gross sum basis in the amount of $17,531.46 inclusive of GST. This sum is comprised of $17,180.63 for professional costs, $141.90 for Mr Sharrock’s travel expenses, $189.63 in reimbursement of the Snap Printing receipt dated 15 December 2017 and $19.30 in reimbursement of the Australia Post receipt of the same date.

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Decision last updated: 19 March 2018