State of New South Wales v Avery

The State of New South Wales sought judicial review of a decision made by a District Court judge concerning the calculation of costs recoverable in a personal injury matter. The dispute arose from an appeal to the District Court from a decision of a costs assessor, which in turn related to the maximum costs that could be recovered by Mr Avery in his personal injury claim under section 338 of the *Legal Profession Act 2004* (NSW). The core of the disagreement centred on whether the "amount recovered on a claim" for the purposes of this calculation should include amounts attributable to pre-judgment interest, as contemplated by section 343(2) of the Act, which deals with the "addition of interest".

The Court of Appeal was required to determine the proper interpretation of "amount recovered on a claim" within the context of section 338 of the *Legal Profession Act 2004* (NSW). Specifically, the court had to decide whether pre-judgment interest, when awarded, formed part of the amount recovered for the purpose of calculating the statutory limit on recoverable costs. This involved an analysis of the interplay between the provisions governing the calculation of maximum costs and those permitting the addition of interest to judgments.

The Court of Appeal reasoned that the phrase "amount recovered on a claim" in section 338 should be interpreted broadly to encompass all sums awarded to the claimant, including pre-judgment interest. The court found that section 343(2) contemplated the addition of interest to the judgment amount, and that this added interest was effectively part of the recovery on the claim. Therefore, the amount recovered for the purposes of section 338 included the principal sum awarded plus any pre-judgment interest.

Consequently, the summons filed by the State of New South Wales was dismissed, and the State was ordered to pay the costs of Mr Avery in relation to the summons.