The Australasian Lawyers Group Pty Ltd T/As Butlers Barristers and Solicitors Applicant v Bruce Morgan Respondent

[2018] WASC 69 (S)

[2018] WASC 69 (S)

JURISDICTION	:	SUPREME COURT OF WESTERN AUSTRALIA IN CHAMBERS
CITATION	:	THE AUSTRALASIAN LAWYERS GROUP PTY LTD T/AS BUTLERS BARRISTERS & SOLICITORS -v- MORGAN [2018] WASC 69 (S)

CORAM	: ALLANSON J
HEARD	: 20 MARCH 2018
DELIVERED	: 30 APRIL 2018
FILE NO/S	:  LPA 21 of 2013
BETWEEN	:  THE AUSTRALASIAN LAWYERS GROUP PTY LTD T/AS BUTLERS BARRISTERS & SOLICITORS Applicant

AND

BRUCE MORGAN

Respondent

Catchwords:

Costs - Whether practitioner should pay interest to the date of setting aside the certificate of taxation

Legislation:

Legal Profession Act 2008 (WA), s 305(3)
Rules of the Supreme Court 1971 (WA), O 66 r 55

[2018] WASC 69 (S)

Result:

Question of interest reserved pending reassessment

Category: B

Representation:

Counsel:

Applicant : Mr S Penglis

Respondent : Mr B W Ashdown

Solicitors:

Applicant : Coulson Legal

Respondent : Stewart Forbes

Case(s) referred to in decision(s):

Commonwealth of Australia v McCormack [1984] HCA 57; 155 CLR 273
National Australia Bank Ltd v Bond Brewing Holdings Ltd [1991] 1 VR 386

[2018] WASC 69 (S)

ALLANSON J

ALLANSON J:

1. On 7 March 2018, on a review of a costs assessment under O 66 r 55 of the Rules of the Supreme Court 1971 (WA), I held that the assessment of solicitor and client costs between the applicant/legal practitioner and the respondent/client should be set aside and the bill referred for assessment before another taxing officer.

2. Orders to implement the decision were made on 20 March 2018, with the practitioner undertaking to repay the amount of the assessment pending further assessment, with interest, from the date of the order setting the assessment aside until payment. The practitioner also undertook to repay the costs ordered against the client in the sum of $40,000, with interest, to the date of payment.

3. The remaining issue between the parties arising out of my decision is whether the practitioner should also pay interest on the amount it has undertaken to repay from the date of payment. The amount of interest is comparatively small, but in this matter nothing appears capable of resolution without a decision of the court.

4. The practitioner does not dispute that the court has power to award interest. Under O 66 r 55(2) the court may 'make such order to rectify the error as the Judge thinks just'. It is not necessary to rely on the power to order interest as restitution in the court's inherent jurisdiction.1 There is a clear statutory power to do so.

5. Counsel for the client submitted that interest should be ordered because the effect of the order setting aside the certificate of taxation was that the certificate was void from when it was first made. The result is that there was no legal authority for the payment to the practitioner. I do not accept that argument. I do not read the power in O 66 r 55 to rectify the error of the taxing officer as a power to declare the assessment of costs and resulting certificate void. The certificate has effect under the Legal Profession Act 2008 (WA) as if it were a judgment of the court (s 305(3)). In my opinion, like a judgment, it has effect until set aside.

6. Counsel also submitted that, on principles of restitution, the client is entitled as a right to interest. The authorities establish that is generally the case. When a judgment is overturned, on appeal or otherwise, the court will endeavour to restore the parties to the position

1 Commonwealth of Australia v McCormack [1984] HCA 57; 155 CLR 273, 276.

[2018] WASC 69 (S)

ALLANSON J

in which they would have been but for the erroneous judgment, including by an award of interest on a sum paid under the judgment that has been set aside.2

1. Counsel for the practitioner submitted that, because the amount of costs ultimately would only bear interest from the date of the certificate of taxation, an order for interest could have an unfair result. That is, the practitioner would pay interest, which it could not recover, on a sum to which it was ultimately held to be entitled.

2. There is, in my opinion, some force in the practitioner's contention about the fairness of the result.

3. The fairest way to resolve the matter, in my opinion, is to reserve the question of interest until the formal certificate of taxation has been issued. Only then will it be possible to determine whether and to what extent an order for the payment of interest would effect just restitution.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

ZW

ASSOCIATE TO THE HONOURABLE JUSTICE ALLANSON

30 APRIL 2018

2 National Australia Bank Ltd v Bond Brewing Holdings Ltd [1991] 1 VR 386, 591 - 599.