UTA Pty Ltd v Albany Star Pty Ltd
[2007] WADC 39
•29 MARCH 2007
UTA PTY LTD -v- ALBANY STAR PTY LTD & ANOR [2007] WADC 39
| Link to Appeal : | [2007] WADC 186 |
| DISTRICT COURT OF WESTERN AUSTRALIA | Citation No: | [2007] WADC 39 | |
| Case No: | CIV:558/2005 | NOT APPLICABLE | |
| Coram: | DEPUTY REGISTRAR HARMAN | 29/03/07 | |
| PERTH | |||
| 7 | Judgment Part: | 1 of 1 | |
| Result: | Objection not sustained | ||
| PDF Version |
| Parties: | UTA PTY LTD ALBANY STAR PTY LTD MARK PETER CELENZA AND PETER CLEMENT MOORE |
Catchwords: | Practice Western Australia Practice under the Rules of the Supreme Court of Western Australia Review of taxation Claim for getting up case for trial where pleadings have not closed Sharpe v Pascoe considered |
Legislation: | Nil |
Case References: | Australian Coal and Shale Employees' Federation v The Commonwealth (1953) 94 CLR 621 Hingston v Challiston Pty Ltd & Ors [2006] WADC 132 Sharpe v Pascoe, unreported; SCt of WA, Library No 521.1; 12 August 1968 Smith v Buller (1875) 19 Eq 473 Nil |
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
- IN CIVIL
- Plaintiff
AND
ALBANY STAR PTY LTD
First defendant
MARK PETER CELENZA AND PETER CLEMENT MOORE
Second defendant
Catchwords:
Practice - Western Australia - Practice under the Rules of the Supreme Court of Western Australia - Review of taxation - Claim for getting up case for trial where pleadings have not closed - Sharpe v Pascoe considered
Legislation:
Nil
(Page 2)
Result:
Objection not sustained
Representation:
Counsel:
Plaintiff : No appearance
First defendant : No appearance
Second defendant : No appearance
Solicitors:
Plaintiff : Solomon Brothers
First defendant : Conal O'Toole
Second defendant : Conal O'Toole
Case(s) referred to in judgment(s):
Australian Coal and Shale Employees' Federation v The Commonwealth (1953) 94 CLR 621
Hingston v Challiston Pty Ltd & Ors [2006] WADC 132
Sharpe v Pascoe, unreported; SCt of WA, Library No 521.1; 12 August 1968
Smith v Buller (1875) 19 Eq 473
(Page 3)
1 DEPUTY REGISTRAR HARMAN: The plaintiff proceeded in the action to the point of filing a statement of claim. On 2 May 2006 it filed notice of discontinuance, upon which the defendants became entitled to their costs of the action.
2 The defendants object to the disallowance of their claim for getting up the case for trial. The grounds of objection are as follows:
"4.1 The learned Taxing Officer erred in principle in finding that no allowance for getting up should be made (or an allowance in lieu of getting up pursuant to Order 66 Rule 21) on the bases (sic) that:
4.1.1 Pursuant to Order 23 rule 2(i) the defendants were entitled to recover their costs of the action but there was "Not action". Consequently, even though the learned Taxing Officer was satisfied that everything done by the defendants' solicitor was proper and reasonable in the circumstances, and that he was satisfied in regard to the amount claimed for getting up, no allowance could be made.
4.1.2 the pleadings had not closed at the time when the matter was discontinued and consequently the issues had not been defined;
4.1.3 the reasons for decision in Sharpe v Pascoe (unreported, WASC, Hale J, 12.08.68, Lib No 521.1) allowing pre-writ costs as part of getting up were irrelevant.
4.2 The learned Taxing Officer should have allowed all costs reasonably and properly and not prematurely incurred prior to the receipt of the notice of discontinuance (Harrison v Leutner (1881) 16 ChD 559 at 560).
4.3 The item should have been assessed by in the normal way by hearing and considering submissions from both parties regarding the nature and complexity of the matter, the time reasonably and/or reasonably spent by the plaintiff's solicitors in gathering and considering evidence, briefing counsel and obtaining counsel's advice and any other matters relevant to a claim for getting up."
(Page 4)
3 There is nothing in O 23 r 2 (1) Rules of the Supreme Court of Western Australia 1971 that would indicate that the phrase "pay (the) defendant's costs of the action" contained within it would have any different meaning or effect in the context of discontinuance than it has in any other. Accordingly, the test of recovery applied in taxing the claim was that which applies under the usual order: that the defendants were entitled to recover the reasonable cost of services that had necessarily been provided to them for the purposes of the action. Although the defendants do not object on the basis that the wrong test of recovery was applied the grounds of the objection canvass the application of a different test. Order 66 r 11 (3) specifies that recovery by a practitioner under a retainer depends upon satisfaction of the test that a service had properly been provided. The defendants at par 4.1.1 and par 4.2 of the objection and the court in each of the cases cited by the defendants refer to such a test. The obiter comment in each of those cases is illustrative of similar comment in many other reported decisions that reveals the introduction into (or substitution for) the first limb of the test of recovery consideration of what services had been reasonably or properly provided. As the plaintiff records in its response to the objection, Smith v Buller (1875) 19 Eq 473at p 475 reveals that the first limb of the test of recovery strikes a balance between competing interests. It is for the beneficial party to establish that a service had necessarily been provided for the purposes of the action. The comment made in the cases cited by the defendants and the broader scope of cases to which I have alluded would tend to disturb that balance in favour of the beneficial party, however as it is obiter it is not clear whether such movement was considered or whether it simply followed upon failure to recognise that the test is comprised of distinct limbs that relate to different considerations. Although in Smith v Buller Malins VC characterised as "'luxuries" those services that would fail the test of necessity, so to do would carry no significance. Once the services necessarily provided have been identified it is then a matter of considering their value. There can be no doubt that the determinant of value is what is reasonable.
4 Paragraph 4.1.2 accurately portrays the reason for disallowance of the claim. In an action where pleadings would confine the issues to be tried the close of pleadings provides a datum for determining whether services claimed to be part of getting up case for trial may be characterised as such. The significant proportion of the work associated with the process of getting up a case for trial would only be justified by that datum. In this case there no defence had been filed and on the submissions, I concluded that to the point of discontinuance none had
(Page 5)
- been contemplated. The relatively less significant proportion would be justified by rules that establish obligations to be discharged in the progression of an action to trial. No such obligation would arise prior to the close of pleadings.
5 As to the second sentence of par 4.1.1, had I been taxing a claim for the same services in the defendants' solicitor's bill I may have been satisfied that the cost of their provision may have been recoverable. That prospect would not speak to whether the services to which they would relate would have been necessarily provided. Although I take it to be the case that by the terms of the objection the defendants would contend that the issue of recovery by a practitioner was canvassed at the taxation I would have done so only in the interests of distinguishing the tests of recovery that apply on the taxation of a practitioner's and a party's bill.
6 In his reasons for decision in 4 cases that have come to be known simply as Sharpe v Pascoe, unreported; SCt of WA, Library No 521.1; 12 August 1968, Hale J considered objections brought by the adverse parties. The common objection contended that the plaintiff had recovered a greater sum than could lawfully have actually been determined under the relevant scale item. That proposition depended on whether the limit on recovery expressed in item 10(g), (in the 2004 scale 19(g)) applied. His Honour determined that it did not. Although his Honour went to the trouble of recording practice and the intention recorded in item 10(g), he stated that in reaching his conclusion he had not engaged in a process of interpretation.
7 The following passage appears at p 2 of the reasons:
"The submission by the defendant is that if the only issue tried is as to damages then in the absence of a direction by the court, the maximum sum allowable under item 9 (in the 2004 scale, item 16) is one half (in the 2004 scale, ¾) of what would have been allowable if the issue of negligence had also been tried, and that this is no matter how much work may have properly been done on the issue of negligence and no matter how late in the proceedings the defendant may have admitted liability. In my opinion the taxing master was right in rejecting that submission. Item 10(g) (19(g)) relates in terms to the issue of quantum of damages: it prescribes what costs shall be allowed for the trial of that issue if it is the only issue tried, and the combination of items 9 and 10(g) prescribe what costs shall be allowed for the getting up of that issue for trial. Item 10(g) has
(Page 6)
- nothing to say as to an allowance for any other work which may have properly been done in the course of the action."
8 He continued:
"In my opinion an additional allowance may be made for getting up the case on the issue of negligence if that work was properly done when it was done, subject of course to the overall limit imposed by item 9 in respect of the whole of the work of getting up."
9 Of the prospect of there being such an additional allowance, he had this to say at p 4:
"Clearly such claims must be carefully scrutinised and care must be exercised not to allow in a party and party bill costs which are in truth only solicitor and client costs. It is true that the effect of Rule 19 (now 11(3)) is in general that the costs allowed on taxation will apply as between solicitor and client as well as between party and party, but that rule recognises that there can still be a difference and it expressly permits the Taxing Master, without a fresh taxation, to allow to the solicitor as against his client costs which are disallowed as against the opposite party."
10 In light of the scope of the objection before him, in the first passage his Honour did no more than he purported to do: that is to express and respond to an illustrative submission. The opinion expressed in the second passage had nothing to do with the objection. Accordingly, although the case may be projected as standing for the proposition that his Honour had made a determination that related to the services for which recovery was had, upon analysis it does not do so.
11 As I recorded at the commencement of my reasons, his Honour portrays the submission in the first passage as having at its core the test of recovery that would apply on the taxation of a practitioner's bill. He refers to the same datum in the second. In the last although he identifies the rule which distinguishes solicitor/client and party/party recovery he did not refer to that part of the rule that expresses the basis for the distinction. In the light of that analysis, whatever value may be attributed to the second passage would be conditioned by both the last and the basis for the distinction between the forms of recovery.
(Page 7)
12 At par 4.1 the defendants propose that an alternative ground for making allowance was available under r 21. In its response to the objection the plaintiff contends that the issue had not been raised at taxation. According to Australian Coal and Shale Employees' Federation v The Commonwealth (1953) 94 CLR 621, that fact would not be significant if the taxing officer considered that he had erred. Regardless of the issue raised by the plaintiff I do not consider that recourse to r 21 would assist the defendants. That is because I do not consider that the scope for recovery under r21 is any different to that provided under the scale for getting up case. In Hingston v Challiston Pty Ltd & Ors [2006] WADC 132 I delivered reasons along the lines that r 21 is simply an anachronism from a time when recovery for getting up case was determined in whole or in part by the value of the subject matter of the action. The rule provided a mechanism to ensure that that such a process of valuing the service would not be available in circumstances where a case had not been tried. I am not persuaded that my assessment of the rule was wrong.
13 As to par 4.2, the case cited appears to have little bearing on what is before me. If there is any ratio to be drawn from a case described in the head-note of its report as a statement of practice, it would emerge from a context where there had been partial provision of part of a service in circumstances in which there would be no close of pleadings. In that case the plaintiff had discontinued a motion for an injunction and the defendant had sought to recover the cost of preparing affidavits. The defendants have chosen not to describe the services for which recovery had been sought under the claim. As the plaintiff records, the significant feature of the activity undertaken by the defendants' solicitor was that it had been directed to a proposed attack on the validity of the claim other than at trial. Even if the pleadings had closed and substantial work been performed in getting up the case for trial, the defendants would not have recovered such costs under a claim for getting up case for trial.
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