Village Life Ltd v Hanne - [2008] NSWDC 291

CITATION: Village Life Ltd v Hanne [2008] NSWDC 291

HEARING DATE(S): 2 December 2008

JUDGMENT DATE:
3 December 2008

JURISDICTION: Civil

JUDGMENT OF: Murrell SC DCJ

CATCHWORDS: PROCEDURE- Costs - Appeals from costs assessor - Role of costs assessor - "Fair and reasonable amount of costs for the work concerned"

LEGISLATION CITED: Civil Procedure Act 2005
Legal Profession Act 2004
Uniform Civil Procedure Rules 2005

CASES CITED: Ryan v Hansen [2000] NSWSC 354
Skalkos v T&S Recoveries Pty Ltd [2004] NSWCA 281

PARTIES: Village Life Ltd (First plaintiff)
Peter Hanne (First defendant)
Richard Vernon (Second defendant)

FILE NUMBER(S): 4529/08

COUNSEL: L Menzies (for the plaintiff)
Castle (for the defendants)

SOLICITORS: C Brierley (for the plaintiff)

JUDGMENT
Background

1. Peter Hanne & Associates Pty Ltd and Richard Vernon brought Supreme Court proceedings against Village Life Ltd. Hanne and Vernon decided to discontinue the proceedings as it was more appropriate to institute proceedings in the Federal Court. The Supreme Court granted leave to discontinue the proceedings.

2. There was a dispute as to the costs of the Supreme Court proceedings. Hanne and Vernon argued that, as the proposed Federal Court proceedings concerned "materially identical factual matters", the costs of the Supreme Court proceedings should be costs in the cause of the proposed Federal Court proceedings. The Court disagreed. On 12 October 2007, the Court ordered that Hanne/Vernon pay Village Life's costs of the proceedings. Subsequently, Hanne and Vernon commenced Federal Court proceedings.

3. Village Life applied for an assessment of the Supreme Court costs. The costs assessor disallowed much of the claim for disbursements ($35,342 disallowed, $19,780 allowed) and professional costs ($7,723 disallowed, $9,736 allowed) on the basis that the disallowed amounts pertained to "ongoing benefit work", i.e. work that would benefit the Federal Court proceedings. He allowed the fair and reasonable costs of the Supreme Court proceeding "to the extent that such costs have been thrown away by commencement of each proceedings in the Supreme Court".

The Issue

4. Pursuant to s 384 (1) of the Legal Profession Act 2004, Village Life appealed, claiming that the costs assessor erred in law by disallowing much of its ordinary costs and limiting costs to "costs thrown away".

5. The issue is the extent of a costs assessor's discretion under s 364 of the Legal Profession Act.

The Legislative Scheme

6. Section 98 of the Civil Procedure Act 2005 gives the courts a wide discretionary power in relation to costs. It provides:

"98 (1) Subject to the rules of court and to this or any other Act:

(a) costs are in the discretion of the court, and

(b) the court has full power to determine by whom, to whom and

costs are to be paid, and

(c) the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis." (emphasis added)

7. A person who is liable to pay or is entitled to receive costs as a result of an order for the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2008] NSWDC 291
Decision Date: 3 December 2008

CaseChat Overview and Summary

Village Life Ltd, a company involved in the construction industry, appealed against an order made by the costs assessor, Hanne, regarding the costs associated with their litigation against another party. The dispute before the court centred around the interpretation and application of the statutory framework governing costs in civil litigation, specifically the determination of what constitutes a fair and reasonable amount of costs for the work concerned.

The primary legal issue was whether the costs assessor, Hanne, correctly applied the statutory criteria in determining the costs to be awarded. Village Life Ltd argued that the costs assessed were not fair and reasonable and that the assessor had failed to properly consider the relevant factors. They contended that the assessor had not adequately justified the costs awarded and that the decision was not in accordance with the law.

The court examined the statutory provisions and the principles governing costs in civil litigation. It held that the costs assessor was required to determine what constitutes a fair and reasonable amount of costs for the work concerned, taking into account the nature, extent, and complexity of the litigation. The court found that the assessor had considered the relevant factors and provided adequate reasons for the costs awarded. Consequently, the appeal against the costs order was dismissed, and the decision of the costs assessor, Hanne, was upheld as correct.

Orders