| JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : WILSON -v- CASSIDY [2013] WADC 184 CORAM : DEPUTY REGISTRAR HARMAN HEARD : ON THE PAPERS DELIVERED : 27 NOVEMBER 2013 FILE NO/S : CIV 678 of 2012 BETWEEN : MARGARET JOY WILSON Plaintiff
AND
NATHAN LEO JAMES CASSIDY
Defendant
Catchwords: Practice - Western Australia - Practice under the Rules of the Supreme Court 1971 - Review of taxation - Inspection, preparation for pre-trial conference, preparation of case - Taxation of costs Legislation: Nil Result: Allegations of error not established
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Representation: Counsel:
Plaintiff : No appearance
Defendant : No appearance
Solicitors:
Plaintiff : S C Nigam & Co
Defendant : Tottle Partners
Case(s) referred to in judgment(s):
Nil
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1 DEPUTY REGISTRAR HARMAN: The plaintiff is entitled to recover in accordance with the scale the reasonable cost of services necessarily provided to her in the course of the action. She has lodged a notice of objection to determinations made upon taxation of four items in her bill of costs.
2 The first, made under item 8 is as follows: Taking inspection of defendant's documents requested 4 April 2013. 3 Although the defendant had not put in issue the necessity for provision of the service, because recovery under item 8 is at hourly rates, determining quantum necessitated consideration of the extent to which the activity outlined by the plaintiff accorded with inspection. In broad terms the plaintiff had obtained copies of documents and considered their content. Such activity is at the core of the service preparation of case. In the context of taxation it is desirable that services be distinguished in order not to found the perception of double recovery. 4 As I had heard nothing directly on point I took it to be the case that either inspection had not actually been undertaken or that for some reason, the undertaking had not been worth mentioning. In any event I was satisfied that had the service been provided the plaintiff would have been able to identify the documents as those described in the list without much difficulty. To the extent that the activity had generated scope for the provision of inspection I determined that the plaintiff was entitled to $100. I have taken the opportunity to qualify the basis for the determination because absent the concession, I suspect that it would have been different. 5 Part of the objection is as follows: (Page 4)
(iii) the time spent checking and considering the document received from the defendant's solicitors. (c) The Taxing Officer's failure to take all of the above into account constitutes an error in principle. 6 The activity outlined in par (b) is consistent with that outlined at taxation. 7 It is noteworthy that prior to the result being recorded the plaintiff sought to amend the bill with the result that what would have been taxed off the amount claimed was added to her claim for preparation of case. In taxing that claim, the activity that accounted for the amendment was not contested and quantum was determined accordingly. Apart from rescuing what would otherwise have been lost, the only consequence of the amendment was that the activity the subject of the amendment would be valued as preparation of case rather than as inspection. In my opinion by choosing to amend the plaintiff accepted that fact. Further, having amended the bill then recovering for all of the activity the subject of the original claim either as inspection or preparation of case I doubt that it is open to the plaintiff to object to the determination. 8 As for the proposition implicit in the objection that the activity described should be valued as inspection it is remarkable that, but for par (b) (i), there is no specification of the basis for the claim. Furthermore what is specified at par (b) (i) casts some doubt that the balance of par (b) is put any higher. In any event to specify the basis for the proposition at par (b) (i) as what is reasonable is not helpful. That is the test of recovery. In light of the provision for recovery expressed at item 8, at the very least there ought to either be an indication that time had been recorded or that a period of time could be established to justify recovery at a level different to that achieved at taxation. 9 Whilst the plaintiff ought to be regarded as free to advance any case for recovery for any service as she chooses, at the point of alleging that an error has been made in determining her claim, in my opinion she has reached the point at which she would be expected to have committed to a particular case or cases. She can not expect to leave it to the taxing officer to draw inferences: after all she carries the onus of persuasion that the determination that she should recover $100 for inspection was seriously flawed. 10 Despite or perhaps because I have covered that territory I will move on to consider the objection at par (c) on the basis of what is put at par (b). (Page 5)
Before I do I note that in 2010 item 8 was amended to expressly provide for recovery regardless the manner of provision of the service. Because prior to the amendment, at the level of principle, there had been no reason to consider that recovery depended upon the provision of the service in a particular manner, it may be considered that by the terms of amendment the committee had simply intended to clarify the position. The significant consideration is that there is nothing to indicate that by the amendment it had been intended that the service would be redefined or reconstituted. The broader expression of the item does not translate to the proposition that any activity undertaken either by reference to a list of documents or to the content of any document in that list amounts to inspection. 11 With particular reference to the first part of par (b) (i), it is likely that such a list would be consulted on a number of occasions for various reasons. The plaintiff does not specify what 'checking' involved. It may amount to nothing more than reading, but the term suggests more. At the level of principle reading a list of documents that has been generated in the course of discharging the obligation to discover is indistinguishable from reading any other document which discloses the existence of another. 12 The balance of the paragraph imports the prospect that the checking had been undertaken at the point of requesting copies. Indeed in the broad context provided by par (b) it is open to consider that the checking had been an early step in a process to the end of considering the content of documents. 13 It is for the plaintiff to satisfy the taxing officer that the activity engaged with the process of inspection rather than preparation of case. Nothing that is now before me draws me to the conclusion that the activity either amounted to inspection or been to the end of inspection. 14 As for par (b)(ii), the fact that a document appears on a list of discovery does not establish a basis to distinguish activity to the end of obtaining a copy from preparation of case. 15 As a matter of principle, regardless the source, seeking copies other than for the purpose of undertaking inspection is beyond the scope of the service. Had the request for copies been made at the conclusion of inspection undertaken in the manner contemplated by O 26 r 8, being what it is, principle would have generated the same result. I will add that (Page 6)
the fact that the entitlement to a copy is expressed in the rule has no bearing upon the principle. 16 It is for the plaintiff to satisfy the taxing officer that seeking copies of documents had been for the purpose of inspection. Nothing that is now before me draws me to the conclusion that by seeking copies the plaintiff had either been engaged in the process of inspection or been engaged in activity to that end. 17 As for par (b) (iii), I have some difficulty. Contrary to what is put, despite my reservations the plaintiff did recover for the prospect that she had ascertained that each document received met the description given to it by the defendant in his list. Otherwise what is outlined at par (b) (iii) is preparation of case. 18 There is a distinction properly drawn between the examination of a document for the purpose of identifying it as a particular item in a list and for the purposes of preparation of case. It is established by the ends served by each process: in the case of inspection, that a relevant document had been discovered. Otherwise reading and considering the content of a document is part of the process of preparation of case. 19 Nothing that was submitted at taxation and nothing now before me on review inclines me to the view that undertaking the activity described in par (b) had been motivated by consideration of any issue relating to the disclosure of documentary evidence. Indeed all that I heard at taxation and have now read leads me to the conclusion that the plaintiff had been motivated to consider the content of particular documents: activity that would fall squarely within the scope of the service preparation of case. 20 I could say more on the distinction between the processes of preparation of case and inspection however there is no allegation of error expressed in the terms of objection along lines that call for more. 21 I do not consider that there is any basis upon which the objection put at par (c) can be sustained. 22 I will add that in my opinion had the plaintiff sought to bring the activity within the scope of the process of inspection it would have been a relatively simple matter to specify that inspection had been undertaken upon receipt of the documents if that had been the case. It is not as though the question of the categorisation of the activity had not emerged at taxation. (Page 7)
23 I will also add that I have no doubt that beneficial parties who have undertaken inspection in the manner outlined in O 26 r 8 have regularly recovered as inspection for activity that had actually amounted to preparation of case. A perception indeed a practice may have evolved to the effect that recovery for inspection would extend to any activity undertaken during the course of such an attendance. Neither mechanism could generate principle. To facilitate recovery other than on the basis of principle would amount to an error in principle. 24 The other part of the objection is as follows: (d) The error in principle is further constituted by the Taxing Officer's failure to identify what services were necessary and secondly objectively assess a reasonable allowance for those services by applying the Rules, the relevant Determination and the underlying principles thereof and then to measure the amount claimed in the bill for the services against the objector's assessment in order to determine whether or not the amount claimed was reasonable and what adjustment, if any, should have been made: Bray v Ryan [1999] WADC 66 [37] and Commonwealth Bank of Australia v Pankaj Oswal in his own capacity and as Trustee for the Burrup Trust[No. 2] [2012] WASC 180 [6]. 25 I have already recorded that I had not been called upon and did not determine the necessity for provision of the service. I struggle with the proposition that I failed to articulate the extent to which the plaintiff recovered for the service. The fact that the plaintiff expresses the balance of par 1 as she does stands in stark contrast with that alleged failure. 26 To the extent that it may be considered that par (d) asserts an error in principle in the assessment of quantum, if there is scope for review then I understand it to be limited to circumstances where the objecting party contends that no taxing officer acting reasonably could have so assessed quantum. There is no such allegation. 27 In any event, recovery for the service is provided for at hourly rates. The fact that the plaintiff obtained 19 documents and that quantum was determined at $100 speaks of an assessment of time that had been devoted to inspection at what was considered to be an appropriate hourly rate. 28 As for the proposition that the amount claimed should be constituted as the datum for assessing quantum, there is nothing to commend it. The process of valuation expressed at item 8 is time costing. The only useful datum is the period of time devoted to provision of the service. I have already noted the deficiency in the documents. (Page 8)
29 In my opinion, what the plaintiff proposes at par (d) is wide of the mark established by the process of taxation. Assessment of quantum for the item is simply a matter of reflecting upon the extent of the beneficial party's engagement with the process, considering the period of time that could be justified had the task been undertaken by a competent practitioner acting efficiently and determining an appropriate hourly rate by reference to the nature of the claim in the action and the complexity of the task presented in the particular case. 30 The next determination the subject of objection was the disallowance of the plaintiff's claim made under item 24(d). It was presented as follows: Preparation for pre-trial conference by solicitor including conference with plaintiff (2.5 hours) $1,127.50. 31 Item 24 of the scale provides: | Item | Time | Fee earner | $ | | 24. | Pretrial, mediation, conferrals, or other conferences- | | (a) Where required by order of the Court, by the Rules of the Supreme Court or by practice direction; | per hour | SP/SC/C | | (b) including informal conferences where reasonably held before or after commencement of proceedings; | per hour | SP/SC/C | | (c) attendances by Counsel and instructing legal practitioners at the conferrals and conferences set out in paragraphs (a) and (b) of this item; | per hour | SP/SC/C | | (d) preparation reasonably undertaken for the conferrals and conferences described in paragraphs (a), (b) and (c) of this item; and | per hour | C | | (e) conferences between Counsel and own instructing Legal Practitioner where reasonably necessary. | per hour | SP/SC/C |
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32 By her objection the plaintiff states: 2(a) The Taxing Officer accepted that 0.5 hours of the claim was made up of a conference between the solicitor and the Plaintiff in preparation for the pre-trial conference. The balance was made up by the practitioner's preparation principally in relation to general damages and the application of South Australia Law to the determination of the quantum of general damages. (b) The Taxing Officer held that scale item 24(d) did not permit any allowance for a conference between the solicitor and the Plaintiff and at scale item 24(e) was not available to the Plaintiff because the conference was not with the counsel. (c) The Taxing Officer further held that no allowance was available because scale item 24(d) was only available to a party if the work was done by counsel. (d) The Taxing Officer erred in principle in regard to (b) and (c) above because: (i) a conference between a solicitor and a party in preparation for a pre-trial conference is both a reasonable and a necessary part of preparing for a pre-trial conference; (ii) an allowance under scale item 24(e) would ordinarily involve the attendance of the party too [sic] and 24(e) can be read so as to include a conference with a party; and (iii) all practitioners in Western Australia are both barristers and solicitors. The use of 'counsel' in the fee earner column of the scale is in any event indicative only and includes work done by any practitioner. For example, scale item 1(c) refers only to senior practitioner in the fee earner column yet work done by counsel, senior counsel and junior solicitors is also covered by this item. See also Commonwealth Bank (above) at [8]. 33 As for the contention in par (d) (i), I accept that for the purposes of taxation under items 24 (d) and (e) the common law test of recovery has been modified. Apart from the prospect that recovery would be had by analogy, the scale outlines the extent to which recovery is available in an action. According to O 66 r 42 the beneficial party is required to identify the service in the scale to which a claim relates. Upon taxation the preliminary question is whether the claim is within the scope provided by the scale. It is only upon being so satisfied that the taxing officer would be required to consider the necessity (in the case of item 24 (d) and (e), the reasonableness) of the provision of the service. To consider (Page 10)
whichever version of the test that applies to particular activity absent provision for recovery under the scale puts the cart before the horse. Accordingly I disagree with the plaintiff that the disallowance of the claim reveals any error. To have allowed the claim absent provision for recovery would have constituted an error. 34 As for par (d) (ii), although I recall that the plaintiff indicated that recovery would available under item 24(e), I have not recorded that any application was made to amend. In any event, according to its terms, recovery is limited to conferences between counsel and legal practitioner. It is not to the point that the party may be present. There was no such conference. For a number of reasons it is difficult to see that the allegation has any merit. 35 To the extent that by par (d) (ii) and par (d) (iii) the plaintiff seeks to construct scope for a favourable interpretation of item 24(d), there are two considerations that support a different conclusion. 36 The committee undertook its task in regulating recovery under item 24 by specifying the designation of fee earner for whom recovery was available on the basis of time costing. At item 24 (d), of the broader scope of fee earners specified elsewhere in the item, only counsel is mentioned. There is reason to consider that thereby it intended to limit recovery to the specified category of practitioner. 37 Provision for recovery along the lines of item 24(d) was introduced in 2010. If the committee had not intended to limit recovery to the preparation of counsel it had the opportunity to remediate in 2012 but it did not do so. 38 The other consideration is that over the period of time that recovery for the service 'pre-trial conference' has been expressly provided for by the scale, it has not been always been the case that preparation has been expressed to be part of the item. Upon the introduction of the item in 1991 preparation was included but by 1996, had been removed. It did not reappear until 2010. Over the intervening period the 1999, 2002, 2004, 2006 and 2008 scales had been published. In my opinion that history constitutes ground to consider that it was intended that recovery be limited to the extent provided regardless the prospect that in every case in this court that proceeded to that point some preparation would have been undertaken. (Page 11)
39 Whilst I have no difficulty with the plaintiff's submission, I am satisfied to the contrary: that in the particular context the committee had intended to distinguish categories of practitioner. 40 I am not persuaded that the plaintiff has established any error of principle. 41 Although the terms of objection do not raise the point, I will add that in light of the history that I have canvassed it would not be appropriate to permit recovery by analogy. 42 The next objection relates to the determination made on the plaintiffs claim for preparation of case. It is expressed as follows: (a) The Taxing Officer's only reason given for the disallowance of $10,000.00 was that the matter was not as complex as had been submitted to him. (b) The Taxing Officer erred in principle in that he did not take into account the time taken in relation to getting up as set out above and the discount already applied, nor did the Taxing Officer take into account the matters set out in Griffiths v DelronCleaning [2003] WADC 123 at [13] - [14]. (c) The Taxing Officer further erred in principle in that he failed to identify what services were necessary and secondly, objectively assess a reasonable allowance for those services by applying the Rules, the relevant Determination and the underlying principles thereof and then to measure the amount claimed in the bill for the services against the objective assessment in order to determine whether or not the amount claimed was reasonable and what adjustment, if any, should have been made: Bray v Ryan [1999] WADC 66 at [37] and Commonwealth Bank of Australia v Pankaj Oswal in his own capacity and as trustee for the Burrup Trust [No 2] [2012] WASC 180. (d) The error in principle is also evident from the allowance itself: see Ninkovic v Cohen [2000] WADC 198. 43 As for par (a) although no objection is expressed I would make two observations. As recovery for the service was not in issue, the test of necessity was not applied: there was no disallowance of any part of the service the subject of the amended claim. I do not resile from the assessment that the provision of the service had not been at the level of complexity promoted by the plaintiff. (Page 12)
44 As for par (b), I take it that the plaintiff proposes that the determination was made absent consideration of the time specified by the plaintiff in the bill. Although it is open to the plaintiff to attribute her failure to recover to the extent of the amount claimed as she does, I would suggest that it is open to consider a divergence of opinion on the question of complexity would also account for the result. It is remarkable that where the plaintiff puts a case by reference to time and then expresses that she has applied a discount that I take would either apply to time or its product, in putting her objection she proposes that to follow the same course for what may be the same reason but apply a different discount reflecting a different judgment as to the degree of complexity amounts to an error in principle. And the more so because judging from the terms of objection it is implicit that she does not indicate any contest to the finding of the degree of complexity and there is no suggestion that the amount determined was unreasonable. 45 Ultimately the result of the application of the part of the test of recovery under consideration (what is reasonable) engages with a standard (the provision of a service by a competent practitioner acting efficiently). In any particular case a judgment on the application of the standard is informed by an assessment of the complexity of the task of providing the service. I note that at par (c) the plaintiff proposes that an objective assessment would be informed by unspecified rules, unspecified features of an unspecified determination and unspecified principle. Apart from the obvious, I will limit my response to the fact that the test I have outlined above is founded upon principle. The plaintiff was entitled to recover no more than the reasonable cost for provision of the service. 46 As for the balance of par (c), significantly the plaintiff does not bring the objection within the perimeter of what I understand to be the limited scope of jurisdiction to review quantum determinations. Quantum was determined within the scope provided by the scale and the result was recorded in accordance with practice by taxing off the amount determined as recoverable from the amount claimed. I have already noted the failure of the plaintiff to identify the particular rule or determination to which she refers. I am not aware of any requirement to the effect that the amount claimed in a bill for an item be constituted as a datum for any purpose. It is only at the level of practice that it is constituted as the datum for the administrative task of recording the result of taxation. In my opinion there is no principle that would support the plaintiff's proposition. In a context where the beneficial party carries the onus it is difficult to see that in the process of valuing a service there would be any logical reason to promote that party's valuation. (Page 13)
47 Whatever the plaintiff contends in relation to the determination made on the claim, in my opinion she has established no error in principle in the assessment of quantum. 48 The last determination the subject of objection relates to the plaintiff's claim for the costs of taxation which was disallowed. The terms of the objection are as follows: (a) The parties were in agreement that an offer for a sum greater than that which had been allowed had been made by the Defendant to the Plaintiff. The parties were also in agreement that this did not constitute a Calderbank offer. (b) The Taxing Officer disallowed the item in its entirety on the basis that there was 'an offer that was not accepted' and further stated 'that is all'. (c) The Taxing Officer erred in principle in that: 49 The defendant had sought disallowance of the claim on the basis that he had offered a sum greater than to that point had been determined in the plaintiff's favour. Apart from being satisfied that the defendant had made the offer I reflected on the time taken to conduct the taxation. I do not consider that the determination reveals any error of principle. The costs of the process in which parties were engaged are discretionary. There is no reason why a taxing officer should not take into account the fact that an offer had been made sufficient to cover the reasonable cost of the services necessarily provided. Under an order for costs there is no reason to consider that the adverse party should pay more.
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