Wayella Nominees Pty Ltd as trustee for the D J Gordon Family Trust v Cowden Ltd
[2003] WASC 210 (S)
•4 NOVEMBER 2003
| JURISDICTION | : | SUPREME COURT OF WESTERN AUSTRALIA IN CIVIL |
| CITATION | : | WAYELLA NOMINEES PTY LTD AS TRUSTEE FOR THE D J GORDON FAMILY TRUST -v- COWDEN LTD [2003] WASC 210 (S) |
| CORAM | : ROBERTS-SMITH J | ||
| HEARD |
| ||
| DELIVERED | : 4 NOVEMBER 2003 | ||
| SUPPLEMENTARY | |||
| DECISION | : 12 JANUARY 2004 | ||
| FILE NO/S |
| ||
| BETWEEN |
|
AND
COWDEN LTD (ACN 008 761 822)
Defendant
Catchwords:
Costs - Special costs order - O 66 r 12(i) Rules of the Supreme Court - Claim for prescriptive easement - Whether case "unusually complex" - Whether amount of time reasonably required to prepare case for trial so substantial as to justify removal of limit for getting up
Legislation:
Rules of the Supreme Court, O 66 r 12(i)
[2003] WASC 210 (S)
Result:
Application granted
Category: B
Representation:
Counsel:
| Plaintiff | : | Dr J J Edelman |
| Defendant | : | Mr M D Cuerden |
Solicitors:
| Plaintiff | : | Clark Whyte |
| Defendant | : | Newton Vincent |
Case(s) referred to in judgment(s):
Collins v Westralian Sands (1993) 9 WAR 56
Esther Investments Pty Ltd v Markalinga Pty Ltd (1992) 8 WAR 400
Jewel Walk Pty Ltd & Anor v Kondinin Group Inc [2001] WASC 197
McLean v Kerville, unreported; SCt of WA (Burt CJ); Library No 6455;
1 October 1986
Robinson v Corse, unreported; SCt of WA (Anderson J); Library No 970183;
23 April 1997
Schmidt v Gilmore [1988] WAR 219
Tenbohmer v Eden (1992) 6 WAR 366
Verdell Pty Ltd v F & G Nominees Pty Ltd [2002] WASC 58 (S2)
Wayella Nominees Pty Ltd as trustee for the D J Gordon Family Trust v
Cowden Ltd [2003] WASC 210
Case(s) also cited:
Nil
[2003] WASC 210 (S)
ROBERTS-SMITH J
ROBERTS-SMITH J: By writ issued on 24 June 2002 the plaintiff sought a declaration that it was entitled to a right of way over the defendant's land, being lot 11 Wellington Street, Perth, and an injunction preventing interference with the exercise of that right of way. The claim was for a prescriptive easement based on 20 years' continuous usage. Following trial held before me between 28 July and 1 August 2003 I gave judgment for the defendant on 4 November 2003 (Wayella Nominees Pty Ltd as trustee for the D J Gordon Family Trust v Cowden Ltd [2003] WASC 210).
2 At that time I made a number of orders, including that the plaintiff
pay the defendant's costs of the action to be taxed, including all reserved costs; that there be a certificate for second counsel and for transcript; that the defendant be allowed the reasonable costs of the report of the expert Ms Pickford and of conferring with her, and that the defendant have liberty to apply within 30 days for any other special costs orders.
3 By letter dated 3 December 2003 to the listings officer the
defendant's solicitors requested that matter be relisted for the hearing of an application for a special costs order. The letter was accompanied by an affidavit of Allan William Newton sworn that day. Mr Newton is the principal of the defendant's solicitors and had the conduct of the matter for and on behalf of the defendant.
4 The application was listed for hearing on 12 January 2004. No
formal application was filed until 9 January 2004, when the defendant's solicitors filed a minute of proposed orders. In my view the application should have been commenced by way of a notice of motion under O 4 r 2(a) of the Rules of the Supreme Court ("RSC"). The order sought by the defendant is to be gleaned from par 3 of Mr Newton's affidavit and from the defendant's minute.
5 The defendant seeks an order that the allowance for item 13 of the
scale in the table to the Legal Practitioners Supreme Court Contentious Business Determination 2002 ("the Determination"); namely, getting up a case for trial, including work reasonably and necessarily undertaken prior to the commencement of proceedings be raised and the limit of $31,300 be removed and the taxing officer be directed to allow such sum as in the opinion of the taxing officer is just and reasonable. In other words, the application is essentially for a removal of the limit imposed in respect of item 13 of the Determination.
[2003] WASC 210 (S)
ROBERTS-SMITH J
6 The application is put on two bases. It is put first on the basis that
the case was unusually complex and, secondly, on the basis that the amount of time reasonably spent by counsel and solicitor in getting the case up for trial of itself was so substantial as to justify removal of the limit as to say is itself a good and proper reason for such removal. The application is made pursuant to O 66 r 12(1) RSC.
7 It is first submitted on behalf of the plaintiff, who responds to this
application, that the application seeks an indefinite increase in the limit to item 13 and that is an application which ought not to be granted because the taxing officer would therefore be provided with no guidance whatsoever as to the largest item in the scale. I do not accept that threshold submission.
In Verdell Pty Ltd v F & G Nominees Pty Ltd [2002] WASC 58 (S2), Wheeler J made a special order for costs on the basis of the unusual complexity of that case. Her Honour ordered that the successful party's costs be taxed without regard to the relevant limits in the scale. A similar approach was taken by Anderson J in Robinson v Corse, unreported; SCt of WA; Library No 970183; 23 April 1997, and likewise in other cases it has been recognised that in the ordinary course of events where a special costs order is justified, it is sufficient to simply order that the limit be removed.
9 In Jewel Walk Pty Ltd & Anor v Kondinin Group Inc [2001] WASC 197 at [31], I made the observation that the effect of my making the special costs order sought in that case would not impede the discretion of the taxing officer. If made, the order would merely allow that officer to consider the charges made beyond the scale limit. It would remain entirely for the exercise of the taxing officer's discretion to determine whether or not they should be allowed as being reasonable charges for work necessarily or reasonably done. In similar vein at [45] I observed that whether or not in the end that work would be shown to have been necessarily and reasonably done or whether an amount should in fact be allowed in excess of the limit would be for the discretion of the taxing officer.
10 The principles applicable to an application of this kind have been
established in a number of cases, including Schmidt v Gilmore [1988] WAR 219, Esther Investments Pty Ltd v Markalinga Pty Ltd (1992) 8 WAR 400, Tenbohmer v Eden (1992) 6 WAR 366, Collins v Westralian Sands (1993) 9 WAR 56 and Jewel Walk and Verdell, to which I have already referred.
[2003] WASC 210 (S)
ROBERTS-SMITH J
11 The nature of the exercise to be conducted and the evidentiary
material required for it were explained, particularly in Collins and in Verdell. Those and other authorities make it clear a Judge considering such an application is not engaging in a taxation. It is neither necessary nor appropriate for the Judge to examine items in a draft bill, line by line. What is necessary rather is for the trial Judge drawing, inter alia, on his or her knowledge of the trial to make a preliminary and provisional judgment whether on the face of it the amount of work done appears to have been reasonably done so as to constitute good and sufficient reason for making the order or, alternatively, as it is put in that way in this case, the case is of unusual complexity, such as to justify an order of that kind.
12 One point which does emerge from the authorities is that it is not
sufficient for the applicant to show merely that work was done. The applicant must show why it was done or the necessity for it must otherwise be apparent to the trial Judge from his or her knowledge of the proceedings: that is to enable the Judge to make that preliminary and provisional determination, whether the work was reasonable and necessary. The point was, with respect, well made by Wheeler J in Verdell at [14] and [15], where her Honour said:
"14
Leaving aside the observations of Owen J in McDonnell at p 9 which may have been prompted by the circumstances of that case, and which I would respectfully suggest should not be seen as stating a general rule, it would appear that the following general propositions emerge in relation to the task of the Judge who determines whether or not a special costs order should be made. If the Judge has been the trial Judge, he or she will be able to draw on experience of the trial, which will be of great assistance in understanding the issues involved, and in appreciating the extent to which, for example, detailed preparation for cross-examination appears to have been necessary, or work appears to have been necessary beyond normal court sitting times to respond to matters arising suddenly during the course of the trial. Whether or not the Judge has been the trial Judge, a perusal of the pleadings, the transcript, and the submissions, together with the materials which may relate to interlocutory applications, will be of great assistance in understanding whether it was necessary for additional work to be done.
[2003] WASC 210 (S)
ROBERTS-SMITH J
15 Whether or not the Judge has been the trial Judge, there may be work done of which the Judge is not aware. For example, there may have been unusually voluminous discovery, which is not reflected in the actual number of documents tendered at trial, or there may have been consultation with potential expert witnesses or research of issues of law which were not in the end reflected in the trial. Such work may not have been unnecessary in the light of what was known at the time, but may have resulted in agreement between the parties or a decision by one or another party to abandon an issue which at first appeared to arise. In those cases, it will be necessary for affidavit material to be placed before the Judge explaining in general terms what work was done and why it was done, and giving some indication of the time occupied by such work. It will, of course, be necessary to establish that, prima facie, costs appear to have been incurred which exceed those allowable under the scale. Whether this material is produced in the form of a computer printout, or a draft bill, or a summary prepared by the practitioner having carriage of the file, does not appear to me to matter. If the step is taken of producing a detailed schedule or a computer printout or the like, the Judge will not examine the material line by line, looking for possible duplication or overlap, or enquiring about the way in which every 10 minutes was spent."
13 I refer to Mr Cuerden's submission that the evidence would only be
required where the work done would not be readily apparent to the trial Judge. In other words, where that would not be readily seen by the trial Judge it would be necessary to provide evidence of what was done and why. That submission, I think, is consistent with what fell from her Honour Wheeler J and I accept it.
14 In the present case the claim is supported in the evidentiary sense by
the affidavit of Mr Newton, to which I shall return in a moment but which, in broad terms, claims that work to the extent of some 700 hours has been done in this case. No bill has yet been drawn and, as Mr Cuerden points out, that amount - or an amount reflecting that number of hours - may not in the end be claimed and that some work in any event may fall under other items in the scale. The affidavit is expressed in that way and put before me only for the purpose of indicating in general terms the defendant's submission that, first of all, the matter was unusually
[2003] WASC 210 (S)
ROBERTS-SMITH J
complex and, secondly, that the work done was so far beyond that ordinarily contemplated by the scale fee as to itself provide a good and sufficient reason for removing the limit.
15 I do not propose to set out here the details of the plaintiff's claim nor
of the defendant's defence nor the evidence given at trial. Those details are sufficiently contained in my judgment delivered on 4 November 2003, which should be read together with these reasons.
16 In his affidavit Mr Newton deposes that when instructed by the
defendant he learned that the defendant had culled documents relating to the property in question that were over seven or eight years old and so had virtually no documents from prior to 1994 or thereabouts.
17 The defendant had been registered as proprietor of the land in
question on 4 February 1986. This is significant because the case concerned the alleged use of the defendant's land by the occupants of the plaintiff's land since 1979, a period of some 22 years. There was at least at the outset some uncertainty as to when the building works were carried out on the plaintiff's land, the defendant not being the owner of his land at the time.
18 In the circumstances Mr Newton deposes that it was necessary for
him to carry out extensive searches of documents from a number of external sources in order to obtain information as to the relevant events since 1979. He refers specifically to the building works carried out in 1979 and searches of the records of the City of Perth relating to those works and the respective properties. He deposes that he inspected various files, including box files, on two or three occasions and obtained copies of them.
19 There was a large number of documents relating primarily to the
works done in about 1979, but also other documents which he needed to review. He estimates he spent approximately 21 hours in carrying out searches at the City of Perth records and inspecting the documents and copies of them. Counsel also needed to review those documents and then additional time was spent collating that evidence. He annexes to his affidavit time sheets as annexure AWN1, which consist of 46 pages of close-typed documents headed "Cowden Time Sheets" covering the period 3 April 2001 to 19 November 2003.
20 It is apparent from the evidence in the case, as I recall it and is
further deposed by Mr Newton, that the land in question had been leased for almost all of the period since the defendant purchased it in 1986 until
[2003] WASC 210 (S)
ROBERTS-SMITH J
the last tenant vacated it between July 1997 and January 1998. The defendant did not have copies of any of those leases other than the most recent one and it was necessary for Mr Newton to obtain copies of them from the tenants or their solicitors. Other inquiries were also necessary.
21 The original tenant, Mr Buckland, or one of his entities, was
problematical, according to Mr Newton, in that Mr Buckland professed to be unable to remember anything about the relevant events. That necessitated further investigation from documents held by third parties. I do not propose to set out in any further detail what is referred to in Mr Newton's affidavit in that regard. Suffice to say there were numerous tenants and a considerable body of documentation. Much of this did in the end appear in the course of the proceedings.
22 One specific item of preparation mentioned by Mr Newton is the
conduct of various company and business name searches in respect of the various tenants. He states that ASIC searches from before 1990 are contained on microfiche, which is time-consuming to review, and his recollection and estimation is that he spent approximately 27 hours conducting such searches and a further 10 hours approximately searching titles, diagrams, plans and other Department of Land Administration searches.
23 Finally, Mr Newton observes that the maximum amount under
item 13 of the scale is $31,300, which is based on 100 hours of a senior practitioner's time and, based on his time sheets, he indicates he has spent in excess of 700 hours on this matter before the commencement of the trial. Although some of that time falls within other specific items of the scale, the majority relates to the time spent getting the case up for trial.
24 The plaintiff respondent has filed and relies upon an affidavit of
Douglas James Gordon sworn on 6 January 2004. That is a brief affidavit to which are annexed invoices from his solicitors for the cost of the entire proceedings. He deposes that the total of those invoices prior to trial is $56,535.63. The only expenses he incurred for inspection of documents at the City of Perth were for inspections on 26 September and 18 October, the cost being for one hour and 12 minutes of time spent by his solicitors for those expenses.
25 So far as Department of Land Administration searches were
concerned the only expenses incurred for searching those were for online
searches and the total cost of those was $325.70.
[2003] WASC 210 (S)
ROBERTS-SMITH J
26 The way in which the plaintiff relies upon that affidavit, in
substance, is to assert that as the entire time spent and costs incurred by the plaintiff's solicitors prior to trial were an amount of somewhat under $57,000, the claim by the defendant's solicitors referring to 700 hours is, on the face of it, not reasonable and not necessary.
27 As to the first basis of the defendant's claim - namely, the unusual
complexity of the case - the submission essentially is that the case was of unusual complexity because the relevant area of the law relating to prescriptive easements is relatively obscure and contains a number of subtleties. It is submitted that a review of the defence and counterclaim and the defendant's outline of submissions for trial reveal that the defendant's case raised a number of complex factual and legal issues, all of which the defendant was justified in raising.
28 It is further submitted that the case was also complicated and the
defendant was put to substantial further costs because the case concerned the claimed use of the defendant's land by the plaintiff's predecessors in title and then the plaintiff for a period in excess of 22 years from 1979; that the defendant did not become the registered proprietor of its land until 4 February 1986 and thus was not the registered proprietor at the time of the development of the plaintiff's land; that Mr Buckland, the principal of the registered proprietor of the defendant's land until February 1986, had no recollection of any relevant matters and that the defendant had culled documents that were over seven or eight years old and so had virtually no documents relating to the land in question from prior to 1994 or thereabouts.
29 In my view, the words "unusual complexity" signify that the
allowances in the Determination are fixed in the expectation that cases to which they apply may be cases of complexity. In other words, for a case to be complex, whether as to fact or law, will not, of itself, justify a departure from the scale unless the degree or nature of the complexity is unusual in a respect which would be seen as reasonably justifying such departure.
30 There is of course also a degree of overlap between the first and the
second bases upon which the present application is put. It is submitted that by reason of the matters going to complexity, the solicitors for the defendant were thereby required to undertake far more extensive searches, inquiries and other work beyond that which would ordinarily be contemplated by item 13 of the scale.
[2003] WASC 210 (S)
ROBERTS-SMITH J
31 The plaintiff submits in relation to this that the application really
must be looked at as justifying only 98 hours of work which could be characterised as falling within the category of "getting up for trial". Dr Edelman says that is a complete answer to this application, in effect, because it does not justify a general raising of the limit. Alternatively his submission is that if the work was prima facie significantly greater than that ordinarily contemplated for the purposes of item 13, then on the face of it it has not been shown to be reasonable. Finally his submission is that even if that were so, then, if an order were to be made, it should be an order which imposes a specific limit.
32 As to the plaintiff's submission that the affidavit of Mr Newton
explains and quantifies only 98 hours of work done, that may be strictly true, but the time sheets certainly show far more than that and I do not read the content of his affidavit as being so limited. What is important for present purposes, it seems to me, is that the affidavit does demonstrate that far more than 100 hours' work has been prima facie necessarily and reasonably done; that being significantly greater than the amount of 100 hours upon which the schedule item is set .
33 There is, in my view, considerable force in the plaintiff's submission
that the evidentiary material in Mr Newton's affidavit going to the searches ought to be considered against the prospect that a number of the matters raised could have been the subject of a request for particulars or a notice to admit facts. Whether or not however the particular searches can ultimately be justified seems to me to be a matter which would be more appropriately dealt with by the closer scrutiny which could be given by a taxing officer than is possible (or appropriate) by me on an application of this kind.
34 I am persuaded by counsel for the plaintiff to the view that the
present case was not, in terms of law certainly, unusually complex. It may be that claims for prescriptive rights do not arise very often, but they do arise and, ex hypothesi, they will involve issues - that is to say, legal issues - of some unusual nature and some degree of subtlety but, as I have already indicated, the fact that a legal issue may be complex is not, of itself, sufficient to justify a departure from the ordinary costs limit in the terms of O 66 r 12.
35 However in my view, the evidentiary and factual issues in this case,
as demonstrated in the conduct of the trial and as appear from Mr Newton's affidavit, lead me to conclude that the amount of work prima facie reasonably required to be done in getting the case up for trial
[2003] WASC 210 (S)
ROBERTS-SMITH J
was so appreciably more than the 100 hours - on which the amount of $31,300 in item 13 was calculated - as to constitute good and sufficient reason to make a special costs order. (See Schmidt v Gilmore, supra).
36 I consider the making of such an order is justified on that basis. I
have given consideration to the question of whether I should order that the total of the enlarged costs for item 13 should not exceed a particular figure. Where I am minded to do so I would require the defendant to bring in a draft minute so that the order could be tailored to the circumstances of this case (McLean v Kerville, unreported; SCt of WA (Burt CJ); Library No 6455; 1 October 1986 at 2).
37 On reflection however, I consider it sufficient to rely upon the
discretion of the taxing officer to determine whether what is claimed should be allowed as being reasonable charges for work necessarily or reasonably done. The application will be granted. I will make a special order pursuant to O 66 r 12 that the cost limit in respect of item 13 of the Determination, "Getting up For Trial", be removed.
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