Zab v Australasian Solicitors Pty Ltd t/as HHG Legal Group - [2023] WASC 43

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   ZAB -v- AUSTRALASIAN SOLICITORS PTY LTD t/as HHG LEGAL GROUP [2023] WASC 43
CORAM:   REGISTRAR FATHARLY
HEARD:   ON THE PAPERS
DELIVERED          :   20 FEBRUARY 2023
PUBLISHED           :   20 FEBRUARY 2023
FILE NO/S:   LPA 52 of 2019
BETWEEN:   ZAB
Applicant
AND
AUSTRALASIAN SOLICITORS PTY LTD t/as HHG LEGAL GROUP
Respondent

Catchwords:

Costs ‑ Assessment of solicitor and own client costs ‑ Costs of cost assessment ‑ 'pub test' ‑ 'Occam's Razor' ‑ Which party should bear costs ‑ Impact of Calderbank offers ‑ Whether unreasonable conduct ‑ Proportionality ‑ Whether indemnity costs orders should be made

Legislation:

Interpretation Act 1984 (WA), s 18, s 19
Legal Profession Act 2008 (WA), s 10, s 251, s 252, s 261, s 290, s291, s295, s304, s307
Legal Profession Conduct Rules 2010 (WA)
Legal Profession Uniform Law Application Act 2022
Legal Profession Uniform Law Australian Solicitors Conduct Rules
Rules of the Supreme Court, O 66 r 53

Result:

Costs assessed confirmed

Costs of assessment determined

Category: B

Representation:

Counsel:

Applicant	:	No appearance
Respondent	:	No appearance

Solicitors:

Applicant	:	In person
Respondent	:	Coulson Legal

Cases referred to in decision:

Bell Lawyers Pty Ltd v Pentelow [2019] HCA 29, (2019) 372 ALR 555
Bentine v Bentine [2016] Ch 489
Calderbank v Calderbank [1975] 3 All ER 333
Caratti v Mammoth Investments Pty Ltd [2016] WASCA 84; (2016) 50 WAR 84
Civil Properties Pty Ltd v Miluc Pty Ltd, Newnes JA [2011] WASCA 195
Eccles v Koolan Iron Ore Pty Ltd [No 3] [2013] WASC 418 (S)
Ford Motor Company of Australia Ltd v Lo Presti [2009] WASCA 115
Hazeldene Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) (2005) 13 VR 435
Heartlink v Jones as Liquidator of HL Diagnostics Pty Ltd (Iin lLiq) [2007] WASC 254(S)
Juris Cor Group Pty Ltd v Price [2020] WASC 308
Legal Profession Complaints Committee and Burg [2019] VR 94
Pridmore v Magenta Nominees Pty Ltd [1999] FCA 152; (1999) 161 ALR 548
Pro Property Pty Ltd v Orchard Holdings Pty Ltd [2013] WASCA 283
Re Rules of the Supreme Court 1971 (WA); Ex Parte Gates [2018] WASC 213
Strzelecki Holdings Pty Ltd v Jorgensen [2019] WASCA 96; (2019) 54 WAR 388
The Australasian Lawyers Group Pty Ltd t/as Butlers Barristers & Solicitors v Morgan [2018] WASC 69
Valdez v Frazer [2017] FamCAFC 18
Zuleika Gold Ltd formerly known as Dampier Gold Ltd v Vango Mining Ltd & Anor [2022] WASC 357 (S)

REGISTRAR FATHARLY:

On the papers

When Charles Dickens published his serial Bleak House[1] his character Mr Jarndyce said of a fictional probate case in the English Court of Chancery:
The lawyers have twisted it into such a state of bedevilment that the original merits of the case have long disappeared from the face of the earth. … It's about nothing but costs now. … All the rest, by some extraordinary means, has melted away.'
[1] Dickens, C, Bleak House a serialised novel published 1852 ‑ 1853, Ch VIII.
This is not a probate case. For over more than two years the respondent solicitors had represented the applicant as their client in Family Court of Western Australia proceedings. However, all but confirmation of the allowance of solicitor and own client costs, and the costs of assessment of the costs, has now melted away but with much argument in the process.
These are my reasons as taxing officer for determining the appropriate costs orders in an application for assessment of the solicitor and own client costs filed under s 295(2) Legal Profession Act 2008 (WA) (LPA),[2] that is, the costs of the costs.
[2] While the LPA has been repealed and replaced with effect from 1 July 2022, the matter is the subject of an application under that Act and to be completed accordingly.
Specifically:
(1)Who should bear costs of the application for the costs assessment and the eight day assessment with arguments in principle and specific entitlements regarding approximately 800 line items of the bill which had to be assessed line by line and of submissions as to who should bear the costs; and
(2)How much should be allowed for costs of the application in addition to the amount allowed for the original assessment of the Bill of Costs (Bill).
These reasons do not arise upon review and determination of taxation objections filed under O 66 r 53 of the Rules of the Supreme Court (RSC) from a party contending that as taxing officer I have made an error of principle in allowing or disallowing any item or part of an item in the Bill. No such objection has been made, at least not at this stage. Accordingly the nature of arguments raised in the application and assessment are referred to in relation to the complexity and time taken rather than merits review.
Invoices originally sent by the respondent billed the applicant as its client $120,682.62 inclusive of GST which she had paid. By these reasons I confirm that the correct amount allowed at assessment, excluding the costs of preparation of the Bill, attendance at assessment and filing fees claimed by the respondent for the amended bill of costs, was $99,831.94.
Following the assessment the parties filed affidavits and submissions for determination of costs of the application and assessment, and of the affidavits and submissions in which:
(1)each allege the conduct of the other has been unreasonable, justifying special costs orders being made against the other in addition to reliance upon statutory provisions as to who should bear the costs and the appropriate exercise of my discretion;
(2)the applicant sought approximately $28,000 in indemnity costs against the respondent; and
(3)the respondent claimed indemnity costs as being appropriate but sought against the applicant $56,000 on a party and party basis.
For the reasons set out, I have determined that it is appropriate that the applicant pay the respondent's costs of the application and assessment in the total sum of $42,523.80 inclusive of disbursements and GST.
A certificate will issue for the allowed costs and costs of the costs assessment if no objection is received.

The costs application

On 22 November 2019 the applicant by her then solicitor, who regularly practices in the area of costs disputes and referred to by the applicant as a costs consultant, filed the application for assessment of costs charged to her as the respondent's client in 37 invoices over more than two years under a written costs agreement.
Of the 83 page application, 81 pages were invoices with detailed itemisations showing the date, a description of the work undertaken, the fee earner undertaking the work by their initials, the number of units of time charged and the amount for each line item of work. Other office expenses and disbursements were separately shown.
The invoices met requirements of a bill for the purposes of s 290 LPA and contained notification of the client's rights for the purposes of s 291. They were a series of interim bills and a final bill, the last issued approximately four months before the application was filed for assessment.
The applicant's solicitors separately filed a copy of the written costs agreement as part of the application documents.
Unhelpfully, when filed:
(1)the application had no summary table of costs the subject of the application showing the costs charged in each invoice or the total costs invoiced the subject of the application, and there was no indication of which if any costs were not in dispute. It was merely a series of invoices by date; and
(2)the cover sheet to the costs agreement specified that in filing the costs agreement, the applicant did not waive any rights to apply for the costs agreement to be set aside, or challenge its applicability or challenge it in any other way.
While the applicant's approach might be considered to be a reservation of rights or initial position at least until access to the respondent's files and to fully prepare objections, that left open every conceivable argument that might be raised in relation to the costs rather than confining the issues for assessment.
In such circumstances it makes it difficult for a Registrar even to undertake a provisional assessment of costs with the view to attempting to have the costs dispute resolved without the need for a full assessment.
The respondents appeared to the proceedings and have at all times been represented by solicitors who regularly practice in the area of costs disputes and who are also known as costs consultants.
The costs agreement was not set aside.
A provisional assessment was undertaken by another Registrar. That assessment was the subject of objection. A conference failed to resolve the objection.
On 22 October 2020 orders were made by a Registrar by consent of the solicitors for each of the applicant and respondent to the effect that:
(1)the respondent file and serve a Bill in relation to the accounts the subject of the application and a Microsoft Word version of the Bill;
(2)the applicants' solicitors be entitled to inspect the respondent's file;
(3)the applicant file objections which specified sums offered for each item and detailed grounds for any objections against the items within the Bill;
(4)the respondent file a response to the objections against items within the Bill;
(5)each solicitor be at liberty to file submissions;
(6)the Bill be listed for a taxation of an estimated duration of two days; and
(7)the costs of and incidental to the consent orders be reserved.
The Bill filed contained:
(1)totals of professional costs and disbursements claimed, amounts charged for individual invoices with date issued, and it itemised every item claimed by reference to date, description, relevant fee earner, rate inclusive of GST charged, time spent amount;
(2)a table of fee earner names, initials, admission date, seniority status and hourly rate inclusive of GST from director through to law clerk;
(3)797 line items of work claimed, plus the additional information, and copies of invoices or vouchers the subject of disbursements where available.

In summary:
(1)The Bill claimed $106,093.70 for professional costs, $12,000 for drafting the Bill, $7,040 for assessing the costs assuming two days being required, and disbursements of $7,306.36 inclusive of $1,004 filing fee for the Bill. The total of the Bill was $132,440.06.
(2)The Bill also referred to the 37 invoices issued to the applicant client as totalling $120,682.62 inclusive of GST.
The applicant's objections filed 8 January 2021:
(1)conceded $32,588.56 being $27,152.60 or 25.6% of professional costs of $106,093.70 and $5,435.96 or 74.4% of the disbursements claimed in the Bill;
(2)reserved objections about drawing the Bill and costs of taxation until after taxation; and
(3)required proof or justification of some disbursements.
As a result of the objections, the difference objected to or requiring proof or justification by the respondent was $99,851.50 inclusive of the claim for drafting the Bill and assessment.
The respondent's response to the objections reduced to $102,815.81 the professional costs claimed, claimed the $19,040 for drafting the Bill and assessing the costs, and disbursements of $7,306.36 inclusive of the $1,004 filing fee for the Bill. The total of the Bill was $129,162.17.
After correction with addition of five additional items, the Bill was increased to $133,250.21 (Amended Bill), however on the face of the Amended Bill the total claim was the amount of $106,903.85 plus disbursements of $7,306.36 and $19,040 for drawing the Bill and attendance at a two day taxation.

Submissions prior to assessment

The main issues raised in written submissions for the applicant client were:
(1)The preparation of a bill by a lawyer at their own expense is part of a lawyer's duty, and the sum for preparing the bill is simply not claimable. There are strong policy reasons not to allow costs for preparation of such a bill. In any event the amount claimed is grossly excessive and in this instance would not pass the ''pub test'' as the sum sought for preparation was more than 10% of the bill.
(2)Intra‑office conferrals are notoriously not chargeable, relying for example on The Australasian Lawyers Group Pty Ltd t/as Butlers Barristers & Solicitors v Morgan,[3] that in this case the conferrals were in effect supervision and teaching sessions for juniors lawyers for which the client should not be liable. The extent of charges in this case was due to less experienced lawyers having much of the conduct rather than experienced senior practitioners.
[3] The Australasian Lawyers Group Pty Ltd t/as Butlers Barristers & Solicitors v Morgan [2018] WASC 69.
(3)The negotiations between the parties to the original dispute were not extensive and were routine.
(4)Too much time was spent drafting documents. It was speculated that this was probably 'down to technique' and submitted that:
… it is becoming a notorious fact in the legal profession that the older generation of lawyers can produce documents quicker, because they dictate. A client should not be paying more just because their lawyer chooses to type.
and
Taxing Registrars should be especially conscious of this issue ‑ which on the surface seems like minutiae ‑ because of:
(i)the perverse incentives lawyers have to produce documents slowly;
(ii)the perverse disincentives lawyers have to produce documents quickly;
(iii)the on‑the‑ground reality that most of what a client pays for is time spent by lawyers at their screens, creating documents – and therefore, how lawyers go about doing that task is a key question, often overlooked.
(5)Every draft of a document must be made available at taxation so that the incremental changes to the document can be analysed and matched against the fees charged for that change.
The respondent law firm submitted that:
(1)It was usual practice and reasonable, for supervising partners to supervise the work of junior practitioners who would run the matter generally and undertook the bulk of the time‑consuming tasks required to be undertaken at lower hourly rates of charge. That occurred in this case and those conferences were necessary to further the matter and therefore chargeable to the client.
(2)No duplication of internal conference costs were claimed, only one of the two fee earners' time was claimed, and there were file notes for the majority of those conferences. Where there were no file notes the conferences could be inferred.
(3)As the Bill and invoices giving rise to the Bill were itemised, numerous separate claims were made for work undertaken in relation to the same document such that multiple line items may be for drafting the same letter or document, which is not unusual if complex documents are drafted over a number of days. The final document was indicative of total time required, but many draft versions were on the files of court documents and correspondence, sufficient to show a process of drafting and support the costs claimed. It was reasonable for the supervising partner to settle such documents.
(4)The Bill includes numerous claims for items of work properly chargeable to the client but for which the respondent did not charge the client. This supports the fact that the charges were reasonable.
(5)Time spent drafting would be considered in the context of the documents and issues at the relevant time.
It is notable and not surprising that in addition to the submissions filed, the Bill itself was 118 pages long, the objections 144 pages long stating objections to each item in issue and the response 124 pages long replying. Numerous items in issue and each line item had been objected to or responded to in detail before the Bill was assessed. Those documents had been prepared by solicitors who practise regularly in the area of costs disputes. Considerable time was clearly spent in the process.
Accordingly, prior to the assessment of the Bill the issues and respective positions were well known to the other, including:
(1)the principles of charging which were in dispute;
(2)the amounts each party believed were properly chargeable; and
(3)the significant time and expense involved in a dispute about every item of principle and of line items where there was disagreement, which time and expense could well be disproportionate to the value of the fees allowed and disallowed.

Assessment of costs

Criteria for assessment of a solicitor and own client bill under the LPA are set out in s 301. In simple terms, it is necessary for the taxing officer to consider whether it was reasonable to carry out the work; whether the work was carried out in a reasonable manner; and the fairness and reasonableness of the amount of legal costs in relation to the work except to the extent s 302 or s 303 applies. Matters to consider as to fairness and reasonableness of the amount are set out in detail in s 301(2).
By s 302, a taxing officer must assess the amount of any disputed costs that are the subject of a costs agreement by reference to the provisions of the costs agreement if a relevant provision of the agreement specifies the amount or rate or means for calculating the amount of costs, and the agreement has not been set aside under s 288, unless the taxing officer is satisfied that the agreement does not materially comply with disclosure requirements of div 3 of the LPA, div 6 precludes the recovery, or the parties otherwise agree.
Relevantly:
(1)I was satisfied that there was an applicable written costs agreement which had not been set aside and the costs were to be assessed by reference to the agreement;
(2)I was not satisfied that the agreement did not comply in a material respect with disclosure requirements of the LPA, or that certain costs were precluded, or the parties otherwise agreed.
Accordingly as taxing officer I was required to assess the amount of costs by reference to the provisions of the costs agreement.
Given the size of the Bill, the number of issues raised and circumstances set out below, the assessment of costs proceeded on 8 April 2021, 15 April 2021, 26 May 2021, 27 May 2021, 6 July 2021, 7 July 2021, 6 August 2021 and 18 November 2021.
The first half day was taken up hearing and determining the approach to be taken to each of the issues the subject of submissions and whether multiple communications in a short space of time should be separately charged for with a unit of six minutes of time or charged collectively with a total reasonable allowance.
In principle, and without at that point having descended to the itemisations, I made clear that:
(1)Intra‑office conferrals may well be established to my satisfaction as necessary and appropriate to be charged to the client. The reasonableness of the charges for those would need to be the subject of hearing from the parties in relation to each conferral and allowing usually for only one of the two practitioner's charges to apply, usually the senior of the practitioners. I disagreed that as a matter of principle they were not chargeable.
(2)In relation to the issues raised about time spent being excessive on particular correspondence or documents, they would need to be considered together with the work reasonably and necessarily required in the matter causing the costs to be incurred.
(3)I did not accept in principle that a number of items referred to were merely administrative or secretarial tasks as opposed to items for which professional fees could be charged.
(4)While issues may arise in relation to the reasonableness of total charges for each item where there are several items such as emails or calls in a short period of time, that did not mean separate charges could not be applied for units of time in accordance with the costs agreement.

There was no evidence to support the applicant's counsel's contention that 'it is becoming a notorious fact in the legal profession that the older generation of lawyers can produce documents quicker, because they dictate'. Having myself been a practitioner for over two decades before appointment as a Registrar, I reject the applicant's contention. It is a matter of how efficiently a document is produced by a practitioner regardless of the technology used or whether it has been dictated.
Having made initial rulings on the first day of assessment on the approach to be taken and having dealt with some of the initial items in the Bill, counsel for the applicant withdrew. The applicant proceeded to represent herself in the assessment from 14 April 2021, before the second day, relying upon the objections and issues raised by her counsel.
While some items were capable of similar consideration, or a number or items related to preparation of certain documents, essentially the applicant's requirement was to proceed line by line whereupon each item would be conceded in whole or part, or the subject of evidence or reference to the actual file records which then needed to be located among the many files, or otherwise remained disputed, argued and ruled upon. In part the objections and response stated the position to be taken on each.
In many cases information was provided by the practitioners who had had day to day conduct of the file. The assessment process was consequently very tedious and very time consuming. The applicant and respondent's counsel were well aware of that.
At all stages of the assessment the parties were advised of my concern as to the costs of the ongoing assessment and the potential impacts that may have at the end of the assessment process. The applicant in particular as a self‑represented party was cautioned about that issue on a number of occasions during the eight days of assessment, particularly given that there was independent representation of the respondent firm with counsel appearing as well as usually two practitioners who had acted on the matter for the client at different periods of time.
One of the two practitioners required by the respondent to be in attendance, one no longer worked for the respondent firm but had been subpoenaed to attend to explain any and all issues arising at the assessment about the history of the file and file documents. The other still worked at the firm and had had later involvement in the matter for the applicant. They were frequently called upon to answer questions about items in the bill, time taken or explain work undertaken by reference to notes, drafts, circumstances or work required at particular stages of the proceedings so as to justify the costs charged for particular items.
At the conclusion of the last day of assessment hearings the respondent's counsel was asked to file a spreadsheet with allowances and disallowed items and the parties were provided the opportunity to file affidavits and submissions as to costs of the application, and the applicant was provided the opportunity to confirm or explain any discrepancies in the spreadsheet.
Subject to confirmation as to total amount of the fees comprising the Bill allowed and costs of the assessment which were reserved, the total of amounts allowed on each item were to be the subject of a certificate.

Amount allowed subject to confirmation at end of assessment

Excluding costs relating to drawing the Bill and time for assessment of the allowable costs:
(1)the applicant's calculation and submission was that the amount of $91,933.50 was allowed, representing a reduction of $28,749.47 on legal costs paid to the respondent of $120,682.62 inclusive of GST, a 23.82% reduction;
(2)the respondent's calculation and submission was that $113,886.22 of the Amended Bill was taxed, that is assessed, with disallowances of $14,160.55, equating to a 12.4% reduction of the taxed costs.
The respondent's Amended Bill filed 14 May 2021 claimed $133,250.21 of which the items relating to the drawing of the Bill and costs assessment and related filing fee totalling $20,044 were not assessed. However, item 200, increased from $140.25 to $1,402.50 with leave to correct an error but that was not reflected in the total shown on the face of the Amended Bill. The total claimed on the face of the Amended Bill should therefore be $134,512.46.
Of the assessed costs claimed, having compared the spreadsheet provided by the respondent's counsel to my record of the assessment and applicant's affidavit with her calculations, $114,468.46 was assessed of which the correct amount disallowed was $14,636.52, leaving $99,831.94 allowed, based on the following:
(1)item 42 was not disallowed. It is correctly allowed in the spreadsheet in the amount of $46.75;
(2)item 190 was reduced by $233.50 not $233.00;
(3)item 198, $46.75, was disallowed;
(4)item 698 was reduced by $10.45 not $10.48;
(5)item 716 was reduced by $129.80 not $121.80;
(6)item 775 was included in the Amended Bill claiming $467.50 which on its face was an error and properly $46.75 was allowed. That $46.75 is correctly stated in the respondent's spreadsheet but the difference of $420.75 needs to be deducted.
(7)accordingly $475.97 needed to be further deducted from the respondent's claimed entitlement, that further amount having been disallowed.
Of the $114,468.46 of costs assessed in the Amended Bill less than 12.8% was taxed off.
Of the invoiced costs of $120,682.62 inclusive of GST, some of which were not claimed in the Bill and some of which were taxed off, 82.7% are recoverable. Effectively a 17.3% reduction of costs in the invoices has occurred.
The above does not address items in the Bill (originally items 771, 772 and 773, but subsequently 776, 777 and 778) relating to the drafting of the Bill ($12,000), attending the assessment ($7,040) and the filing fee for the Bill ($1,004.00), a total of $20,044.00 claimed, being the costs reserved until determination of the amount allowed and consideration of submissions on appropriate costs orders.

Considerations for costs of the costs assessment

By s 304 LPA, a taxing officer must determine the costs of a costs assessment.
Unless I order otherwise, and subject to s 304(4), the law practice to which the costs are payable or were paid must pay the costs of the assessment if the costs are reduced by 15% or more or I am satisfied that the law practice failed to comply with div 3 of the LPA. Subject to those qualifications, the costs of the assessment must be paid by the party ordered to pay those costs.
Division 3 relates to a firm failing to make proper disclosure of costs. I am not satisfied there was such a failure of the respondent.
By s 305 of the LPA, I must certify the amount of the disputed costs allowed and the costs of the costs assessment.
Legal costs are defined in s 3 LPA to mean amounts that a person has been or may be charged by, or is or may become liable to pay to, a law practice for the provision of legal services including disbursements but not including interest.
While the term legal costs is clearly broad enough to include invoiced costs, the purpose of s 302(1) LPA was to require me as the taxing officer to assess the amount of any disputed costs that are subject to a costs agreement by reference to provision of the agreement. I was making an assessment by reference to the Bill, and Amended Bill, in relation to what was disputed or otherwise.
The Legal Profession (Supreme and District Courts) (Contentious Business) Report 2018 (item 30 of scale) and the Legal Profession (Supreme and District Courts) (Contentious Business) Report 2020 (item 32 of scale) each provide for allowance at Senior Practitioner rate amounts for drawing a Bill and service and taxation of costs, such amounts as may be reasonable in the circumstances. The scales provide for charges as between one party and another where there is no entitlement to indemnity for actual costs or special costs orders.
The parties each filed submissions and affidavits relating to the issue of costs of the assessment itself.
Subject to the appropriateness of costs orders to be made in the matter, also relevant to any allowance of costs of the costs application and assessment are:
(1)The applicant could only be entitled to an order for costs in her favour if she has incurred costs to a law firm acting for her and, as a maximum, to the extent of such costs. She was represented by a law firm in commencing the application and up to and including 6 days after the first day of the assessment when she filed a notice that she then acted for herself. Additionally she stated in her affidavit that she sought further advice from her solicitor on an ad hoc basis with summaries of the costs at different points in time. The precise amount for such advice is not clear.
(2)The respondent firm is a company. A body corporate must appear in an action and defend it by a legal practitioner.[4]
(3)The respondent firm may not recover their own costs of and incidental to the application, but may recover the costs of independent legal representation in relation to the application and assessment.[5]
[4] O12 r 1(2) Rules of the Supreme Court.
[5] Bell Lawyers Pty Ltd v Pentelow [2019] HCA 29, (2019) 372 ALR 555.

Applicant's submissions and proposed orders as to costs

The applicant:
(1)sought orders in relation to costs of the application for assessment and of the taxation itself on 8 April 2021, that is for when she was represented, for the respondent firm to pay her costs on an indemnity basis fixed in the sum of $25,000 or party-party basis in the sum of $20,000 or taxed if not agreed, plus further costs of approximately $3,000 for costs of the application, for these costs, the precise amount of which was not yet known; and
(2)relied upon the affidavit of Amy Pascoe sworn 16 December 2021 and on her own affidavit sworn 21 January 2022. In both affidavits there was reference to correspondence between and copies of offers made by each party to the other at different points of time purporting to be made according to the principles of Calderbank v Calderbank[6] at times with warnings to the other of seeking indemnity costs if not accepted.
[6] Calderbank v Calderbank [1975] 3 All ER 333.
The applicant submitted that:
(1)Overcharging is grossly excessive in circumstances where the sum of legal costs to be charged for the work carried out by a reasonably competent and diligent practitioner is 75% or less than the actual fees charged to a client.[7] The respondent's overcharging, confirmed as a result of the costs assessment as a whole, is only just shy of the 25% justifying it being characterised as 'grossly' excessive. At the very least it was excessive overcharging.
[7] Relying upon Legal Profession Complaints Committee and Burg [2019] VR 94.
(2)No costs should be awarded for the costs of drawing the Bill because:
(a)the 15% threshold in s 304 LPA has been exceeded;
(b)the case law and commentary from Law of Costs[8] indicates that costs for the drafting of a bill should not be awarded;
[8] Law of Costs 4^th Ed, G E Dal Pont, 2018, [4.27]. The 5^th Ed, 2021, is consistent.
(c)of what the LPA requires of itemised bills, by reference to the s 252 LPA definition of an itemised bill, that is, a bill that specifies in detail how the legal costs are made up in a way that would allow them to be assessed under div 8;
(d)the fact that the respondent dramatically redrafted the bill was an admission that it had not complied with its obligations under the LPA to issue an itemised bill at the time it issued bills to the applicant as its client;
(e)no client should be required to pay for a lawyer to comply with its obligations under the LPA to issue an itemised bill that is sufficiently detailed in order for it to be assessed;
(f)although denied by the applicant that there are any circumstances under which a lawyer should be able to charge costs for preparation and drafting a Bill, if a Court were to consider that such costs should be awarded, then they should be minimal and not relate to the substance of the itemised entries but instead be related to the administrative process of transfer into a slightly modified format typical of the format and structure of a bill filed with a Court, such costs being minimal and nominal.
(3)As to the 15% issue:
(a)costs as a matter of statutory construction are construed in relation to the bills issued to the client during the course of the retainer, not quite some time after. If there was any real concession by the respondent firm, what should have happened was a refund of conceded amounts. As there was no concession, the proceedings were necessary and the outcome was required. Concessions only arose due to the application and objections;
(b)the objective intention of Parliament in relation to the 15% issue was to provide compensation for legal costs with respect to costs actually paid;
(c)the mischief sought to be remedied by Parliament is overcharging with respect to bills issued to clients. If something else was Parliament's intention it would have expressly stated;
(d)s 18 Interpretation Act 1984 construction of a written law that would promote the purpose or object underlying the written law (whether expressly stated or not) shall be preferred to a construction that would not promote the purpose or object;
(e)s 251 LPA states the purpose of pt 10 of the LPA as being:
(i)to provide for law practices to make disclosures to clients regarding legal costs;
(ii)to regulate the making of costs agreements in respect of legal services, including conditional costs agreements;
(iii)to regulate the billing of costs for legal services;
(v)to provide a mechanism for the assessment of legal costs and the setting aside of certain costs agreements;
(f)the plain purpose and object of the LPA is the protection of the public;
(g)pt 10 div 8 of the LPA is about bills as issued, not bills in assessable form. There is no distinction in the LPA;
(h)although it may be an historical norm amongst some costs consultants in Western Australia, the concept of amending bills in dramatic fashion is found nowhere in the LPA and too nebulous a basis arising from legislation with respect to the 15% rule.
(4)Indemnity costs should be awarded to the applicant for the entire application based upon:
(a)the unreasonable conduct of the respondent in issuing bills which by its admission in needing to redraft the bills for assessment and by overcharging just shy of excessive overcharging;
(b)the respondent acted unreasonably in failing to accept the applicant's offer made on 26 May 2021;
(c)correspondence from the applicant's counsel of 7 April 2021, factoring in concessions made from the rendered bills at that time, which suggested that only a further $6,850.23 would need to be disallowed to reach the 15% threshold;
(e)how the respondent has sought to characterise the sum reduced and the high level of costs claimed by the respondent for the Bill and response to objections; and
(f)the overall costs the respondent is seeking, which are disproportionate and have required the applicant to take legal advice in the circumstances.
(5)Proportionality was an issue.
The applicant stated in her affidavit steps taken regarding proportionality, including attempting to agree categories of issues, and submitted:

(1)That:
It is well-known that there is a high degree of variability amongst Taxing Registrars in relation to disallowing items.
and that:
This is not surprising given that there is a wide discretion … exercised in determining questions of whether it is reasonable to charge at all, and if it is reasonable, what a reasonable sum is …
and:
In effect, these are discretions upon discretions, which inevitably lead to wide variability.
(2)Based upon the variability submission above, it is unsurprising therefore that a former client would pitch objections at their highest, not knowing how the discretion of the particular taxing registrar will be exercised, especially taking into account the limited and small case law on questions as to what is reasonable to charge for, and, what a reasonable sum is for particular types of work, there being an absence of guidelines.
(3)The explanation the applicant has given as a self‑represented litigant is reasonable and she acted in a fair, reasonable and proportionate way in relation to the various amendments to the Bill sought by the respondent in its favour.
(4)Admittedly the process took a long time.
(5)Had the respondent wanted to minimise its legal costs, then like the applicant it could have become self‑represented part way through the proceeding.
(6)There were stark and dramatic differences between the original invoices and itemisations in the Bill, in which case it was sensible and reasonable for someone to want a taxing registrar to properly and thoroughly review the Bill.
(7)Additional evidence needed to be given by the witnesses which was not available on the file for the applicant or her solicitors to consider at the time objections were drafted, being part and parcel of the process which took up extra time and led to extra hours required for the assessment which arose because of the respondent wanting the witnesses to be available.
(8)The time taken as a result of the witnesses being available and giving evidence did not result from the applicant needing or wanting their evidence or wishing them to attend to provide evidence. That time is purely down to the respondent.
(9)Normally a law practice has a file that speaks for itself, and it should be inferred that the file did not speak for itself because of the absence of adequate record‑keeping by the respondent which can give rise to additional objections that might not have been made had the file been adequately comprehensive as an explanation and justification of legal costs.

Consideration of applicant's submissions

Did the respondent's charges constitute excessive overcharging?

Of invoiced costs of $120,682.62 inclusive of GST, $99,831.94 or approximately 82.7% are recoverable. There has been approximately a 17.3% reduction. Of the Amended Bill, there has been approximately a 12.8% reduction of costs assessed.
The invoices gave rise to the application, however the Bill in original form then Amended Bill were the subject of the assessment a considerable time later. Each aspect of that has significance:
(1)On one hand, costs were necessarily incurred by the applicant in commencing the application for the assessment of costs which were considered to be excessive or in some respects not capable of being charged. Had the charged costs been considered by the applicant or her costs consultant solicitor to be more reasonable, or issues raised capable of resolution, then the application may not have been necessary.
(2)On the other hand it is the Amended Bill assessed in this context that must be considered for the purpose of the 15% consideration in s 304 LPA in my view. I was not, by the time of undertaking assessment, considering the detail of invoices rendered but the detail of the Bill and Amended Bill, with corresponding objections, response, submissions and supporting documents. The parties had agreed by consent to a Bill being filed. Had the invoices themselves been the subject of the assessment the starting point would have been higher and disallowed amount and therefore percentage reduction may have differed.
While not apparent to me at the time of the assessment, the applicant's solicitor took the approach with the proceedings, as is evident from the correspondence in the applicant's affidavit, that once the concessions were made at the time of the objections and response, only a modest further dollar figure was required to be taxed off the Bill for the applicant to be successful in having had at least 15% reduction from the legal costs for the purpose of s 304 LPA, that is, from the amount invoiced. In my view that was not the correct approach to be taken in this case, rather a 15% reduction from the Bill or Amended Bill was required to properly enliven reliance upon s 304(2) LPA to require the law practice to pay costs unless I ordered otherwise.

If I am incorrect in principle in that regard, in exercising my discretion under s 304 to 'otherwise order' I consider that the facts of this case do not justify that the respondent should pay the applicant's costs of the application and assessment and the applicant has not satisfied me that she should have the costs of the costs assessment paid to her by the respondent in all of the circumstances set out in these reasons.
While reductions were made, I did not form the view that most costs should be reduced at all, or that the costs charged were overall excessive overcharging as alleged by the applicant. The charges by the respondent were higher than allowed but not excessive overcharging or nearly grossly excessive overcharging as submitted by the applicant.
Further, the respondent's file records were thorough and substantially complete, with file notes being adequately detailed with information and time spent. It was possible with some of the larger documents or different versions of disclosure documents to compare changes made over time.
The assessment application process including the objections, response and submissions reduced to some extent the matters in dispute, but unfortunately only $32,588.56 of the costs claimed were conceded by the applicant of $99,831.94 ultimately allowed, requiring the necessity for extensive arguments as to points of principle and quantum.
The applicant had the right to have her costs assessed, but not at any cost and not without any costs risk of the process, of which she was warned many times.

Should the respondent be entitled to charge for preparation of the bill?

A lump sum bill as defined in s 252 LPA means a bill that describes the legal services to which it relates and specifies the total amount of the legal costs.
An itemised bill as defined in s 252 LPA means a bill that specifies in detail how the legal costs are made up in a way that would allow them to be assessed under div 8.
It is clear that the invoices constituted bills for the purpose of s 290 LPA. The bills were in itemised in detail. Individually each could be considered to be itemised interim bills or an itemised final bill, however for the purposes of the costs assessment application attempting to assess 37 bills individually presented difficulty.
There is no evidence before me that the applicant requested or considered the need for an itemised bill for the purpose of s 292 LPA, or that any costs have been sought by the respondent for the expense of preparing an itemised bill for that purpose. Certainly a law practice is not entitled to charge a person for the preparation of an itemised bill requested under that section.[9] If they had, that cost would not be recoverable.
[9] Section 292(6) LPA.
Significant to the cost of preparation of the Bill in this case were the following factors:
(1)The application was filed 22 November 2019 with the 37 invoices, costs agreement and memorandum of conferral. The application was for an assessment of costs of 'a bill provided to me by a law practice' and 'this bill'.
(2)A provisional assessment made by another Registrar, provided to the parties was the subject of objection. Despite efforts to resolve the dispute, the assessment was required.
(3)The orders made by consent on 22 October 2020 obliged the respondent to file and serve a Bill in relation to the accounts the subject of the application by 19 November 2020, and to provide a Word version to the applicant by 23 November 2020.
(4)The costs of and incidental to the consent orders of 22 October 2020 were reserved.
(5)The effect of the provision of the Bill was to consolidate and supplement information contained in 37 invoices so that it was in an assessable form and capable of provision in both electronic and hard copy in such a manner as ultimately to facilitate line by line objections and responses.
(6)On 23 November 2020 further orders were made by consent extending the time frames. Again the costs of and incidental to the orders were reserved.
(7)The Bill was not requested as an itemised bill requested pursuant to s 292 LPA to properly understand a lump sum bill. It was agreed to be provided by consent as part of the application as a Bill in assessable form by order of the Court, the costs of which were reserved.
(8)Both parties were represented by solicitors who regularly practice in the area of costs disputes at the time the application was filed and those orders were made and complied with.
(9)On the face of the Court documents filed, no concessions had been made by the applicant as to any amount being payable of the invoiced costs between the date the application for assessment was filed on 22 November 2019 and 8 January 2021 when the objections were filed.
(10)The consideration of content of the Bill filed 4 December 2020 followed by the applicant's solicitor's inspection of the respondent's files led to clarification and only then some concessions by the applicant followed by some concessions by the respondent.
(11)There is no evidence that the amendment of descriptions or any changes to the content of the Bill from the original invoices constituted admissions by the respondent that it had not complied with obligations under the LPA to issue an itemised bill at the time it issued bills to the applicant as its client.
(12)The scales provide allowances for preparation of a bill of costs.
Should there be an entitlement for the respondent to recover costs of the application and assessment, in principle there is no reason why an allowance could not be made or should not be made for reasonable costs of preparation of the Bill.

Purpose of pt 10 LPA

In the context of s 267 LPA,[10] Justice Hill stated in Juris Cor Group Pty Ltd v Price [2020] WASC 308 [38] ‑ [39]:
The starting point in considering the meaning of s 267 of the Act is to consider the ordinary and grammatical sense of the statutory words to be interpreted having regard to their context and legislative purpose.[11] Extrinsic materials can be considered to confirm the ordinary meaning conveyed by the text of the provision, or to determine the meaning of a provision where the provision is ambiguous or obscure, or where the ordinary meaning gives rise to a result that is manifestly absurd or unreasonable.[12]
The approach to statutory construction was summarised by Buss JA (as he then was) in Caratti v Mammoth Investments Pty Ltd[13] as follows:
The modern approach to statutory construction is purposive. The statutory text is the surest guide to Parliament's intention. A decision as to the meaning of the text requires consideration of the context, in its widest sense, including the general purpose and policy of the provision.
The context includes the existing state of the law, the history of the legislative scheme and the mischief to which the statute is directed.
The purpose of legislation must be derived from the statutory text and not from any assumption about the desired or desirable reach or operation of the relevant provisions. The intended reach of a legislative provision is to be discerned from the words of the provision and not by making an a priori assumption about its purpose. (footnotes omitted)
[10] Regarding ongoing obligation to make costs disclosure.
[11] Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27
[4].
[12] Interpretation Act 1984 (WA), s 19(1).
[13] Caratti v Mammoth Investments Pty Ltd [2016] WASCA 84; (2016) 50 WAR 84 [390] ‑ [392].
The purposes of pt 10 LPA were clearly stated, and provided for disclosures to clients regarding legal costs, regulation of the making of costs agreements and billing of costs for legal services, and a mechanism for the assessment of legal costs and setting aside certain costs agreements.
Section 304 clearly had a stated purpose of requiring the taxing officer to determine the costs of a costs assessment between solicitor and client. It provided a general position as to which party should pay costs of the assessment dependent upon the outcome or any failure to comply with div 3 disclosure obligations. There is an overarching discretion to the taxing officer to order otherwise.
It is not appropriate to make assumptions about the purposes of pt 10 or s 304. There is no extrinsic material to do so and no need to do so.
What is also clear, contrary to the applicant's submission, is that there is no basis to infer it being an objective intention of Parliament in relation to the 15% issue in s 304 to provide compensation with respect to costs actually paid. Relevantly:
(1)Section 304 is not concerned with compensation for costs paid. It is expressly concerned with the costs of a costs assessment.
(2)Under s 295(2) and s 295(4) LPA, a client may apply to a taxing officer for an assessment of the whole or any part of a bill for legal costs, and an application for a costs assessment may be made even if the legal costs have been wholly or partly paid. Once a certificate issues for the costs allowed and costs of the costs assessment, it is enforceable as if it were a judgment of the Supreme Court.[14] If the costs have been paid, then upon completion of the assessment any overpayment would need to be repaid to the client as the respondent would not have an entitlement to the amount taxed off.
(3)The provisions of s 304 provide on the one hand protections to a client applicant appropriately seeking a costs assessment and on the other a fairness to the respondent firm in the event that the costs are not substantially reduced and there has been appropriate costs disclosure. If there has been a failure by the law practice to comply with div 3 disclosure obligations or there has been reduction of the costs by 15% or more, the law practice would usually be required to pay the costs. Otherwise, the taxing officer may order the other party to pay the costs.
(4)As in most civil disputes before the Court, as a general rule a successful party will be entitled to an order for costs against the unsuccessful party, if they have incurred legal costs, but with the overriding discretion of the Court to make such orders as considered appropriate in the circumstances.
(5)As stated by Dal Pont, Law of Costs,[15] the origins of a rule of 15% can be traced back to the one‑sixth rule prescribed by the Attorneys and Solicitors Act 1729, 2 Geo 2, c 23, burdening the client with the costs of taxation if the amount taxed off is less than one‑sixth of the bill and burdening the lawyer if it is one‑sixth or more. The rule was implemented to prevent lawyers from overcharging clients and the costs risk if items were disallowed, but benefitted clients as well so that each party knew in advance the basic default rule governing costs of a costs assessment, and what ordinarily counted as winning and losing, so that they could make a rational calculation of the risks involved in proceeding with a disputed assessment.[16] The essence of the rule has a long history and which remained within the LPA set at 15%.
(6)As with s 251 LPA, if Parliament had specific intention as to compensation, it could expressly state it.
[14] Section 305(3) LPA.
[15] 5^th Ed, 2021 [5.47] ‑ [5.48].
[16] Bentine v Bentine [2016] Ch 489 [7] Sales LJ.
Clearly there was a dispute in this case as to the reasonableness of costs charged and entitlement for the respondent to charge for and recover certain costs. The application process served the purpose of providing the mechanism for narrowing the issues prior to assessment by some concessions appropriately made and some corrections for the costs to be properly assessed.

Should the applicant be entitled to indemnity for legal costs?

As both parties were represented by practitioners who regularly practised in costs disputes, with the applicant at least represented until shortly after the first day of the assessment, it must have been expected by the both the applicant and respondent that significant costs were being incurred and would be incurred in the process of the application and assessment, which could be significantly disproportionate to the value of the Bill.
The applicant's submission that the unreasonable conduct of the respondent in issuing bills it needed to redraft for assessment and by overcharging just shy of excessive overcharging is unfounded for reasons set out above.
I do not accept the applicant's submission that the respondent acted unreasonably in failing to accept the Calderbank offer she made by email 26 May 2021 on the third day of assessment. She had offered to settle on the basis that the respondent pay her $46,000 in full and final settlement. While not expressly stated in what was a very brief email, that figure appears may have been calculated by reference to earlier Calderbank offers made by her solicitor to accept the sum of $20,000 for legal costs and an additional sum for a refund to her, which varied, for what was alleged to be overcharged costs and set out in more detail the reasons for the offer. There was no express time provided before it would expire and no express reference to indemnity costs. The applicant's earlier offers are referred to below.
As helpfully summarised by the respondent in its submissions:
(1)The test which must be applied in determining whether to award indemnity costs against a party who has rejected a Calderbank offer is whether the rejection was unreasonable in the circumstances: Ford Motor Company of Australia Ltd v Lo Presti,[17] the onus being on the offeror to demonstrate that the rejection of the offer was unreasonable.[18]
(2)A Court considering a submission that it was unreasonable to have rejected a Calderbank offer should ordinarily have regard to at least the following factors:
(a)the stage of proceedings at which the offer was received;
(b)the time allowed to the offeree to consider the offer;
(c)the extent of the compromise offered;
(d)the offeree's prospects of success, assessed as at the date of the offer;
(e)the clarity with which the terms of the offer were expressed; and
(f)whether the offer foreshadowed an application for indemnity costs in the event of rejection, Hazeldene Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) (2005) 13 VR 435, cited with approval in Lo Presti.[19]
[17] Ford Motor Company of Australia Ltd v Lo Presti [2009] WASCA 115 [23].
[18] Lo Presti [21].
[19] [19].
The principles stated in Lo Presti were further summarised and applied by Le Miere J in Eccles v Koolan Iron Ore Pty Ltd[20] and more recently by the Court of Appeal in Strzelecki Holdings Pty Ltd v Jorgensen[21] and Hill J in Zuleika Gold Ltd formerly known as Dampier Gold Ltd v Vango Mining Ltd & Anor.[22]
[20] Eccles v Koolan Iron Ore Pty Ltd [No 3] [2013] WASC 418 (S) [9].
[21] Strzelecki Holdings Pty Ltd v Jorgensen [2019] WASCA 96; (2019) 54 WAR 388.
[22] Zuleika Gold Ltd formerly known as Dampier Gold Ltd v Vango Mining Ltd & Anor [2022] WASC 357 (S).
At the time of the 26 May 2021 offer, significant costs had already been incurred by both parties, the general approach to assessment was known and it was apparent that, of the Amended Bill, in the order of 10 ‑ 15% reduction was being made taking into consideration the numerous items assessed.
If the offer reflected an offer for the applicant to receive $20,000 for her costs to that point, such an amount seems to be high given her solicitor ceased involvement after the first day of the eight days of assessment and many of the arguments put forward in the submissions were somewhat boilerplate in nature.
Further, to repay her $26,000 as an additional sum is more that she could have reasonably expected at that point in time to have taxed off the Amended Bill and returned to her, despite her solicitor's previous correspondence contained in the affidavits contending otherwise. Had there not been more than 15% reduction of the costs, the applicant was also at risk in relation to costs under s 304 LPA.
The applicant submitted that the 26 May 2021 offer represented a better result for the respondent, had it been accepted, taking into account legal costs and the sum to be refunded by the respondent to the applicant for overcharging, that ultimately determined as a result of the application. That is incorrect. Had they accepted such offer, the respondent would have:
(1)paid the applicant a total of $46,000, leaving a balance to them of $74,682.62 of $120,682.62 inclusive of GST initially billed and paid for provision of legal services; and
(2)had to bear its own legal costs of the application which by that stage were already claimed in the Bill as being over $20,000, leaving the respondent in a net position of approximately $54,682 at that time.
The mere fact of whether the respondent as recipient would have been ultimately worse off than had the offer been accepted is not of itself determinative, and even if the respondent was worse off does not mean the rejection was unreasonable.
Taking into account the factors required, I am not satisfied by the applicant that the respondent's rejection of the 26 May 2021 was unreasonable in the circumstances.
Rejection of the 26 May 2021 offer is not a basis to justify any special costs order in favour of the applicant.
Further, even if the amount claimed by the respondent in the Bill for the preparation of the Bill and attendance at the assessment is higher than allowed to the respondent, that is not a basis for indemnity costs in favour of the applicant. Those costs were included as new line items in the Bill to facilitate the assessment. They are not part of the costs originally billed and are the subject of these reasons, not any basis for the contest of the other items in the Bill and the conduct of the parties generally relating to the assessment of the Bill.
Ordinarily an indemnity costs order is appropriate only where the unsuccessful party has been involved in some unreasonable conduct in relation to the proceedings, such as where the institution or continuation of the proceeding was plainly unreasonable or the proceeding was issued or maintained for an ulterior or collateral purpose and…reflects the court's disapproval of the conduct of the unsuccessful party.[23]
[23] Newnes JA in Civil Properties Pty Ltd v Miluc Pty Ltd [2011] WASCA 195 [82] ‑ [83] (cited authorities excluded), cited by Hill J in Zuleika Gold Ltd formerly known as Dampier Gold Ltd v Vango Mining Ltd & Anor [2022] WASC 357 (S) [14].
I do not find that there is any proper basis on which to make any award of indemnity costs against the respondent in favour of the applicant in relation to the costs and I would not exercise my discretion to do so.
Even if I were to do so, the amount of the applicant's costs are significant in the context of the costs the subject of the dispute and I do not consider that the costs sought by the applicant of $25,000 to $28,000 could be justified as a reasonable sum even though the nature of that work comprised:[24]
[24] Amy Pascoe affidavit annexure ALP 5 par 50.
(1)conferral prior to making the application;
(2)the application;
(3)considering merits of a provisional assessment;
(4)a confidential conference;
(5)consideration of the respondent's files;
(6)drafting substantial and detailed objections;
(7)settlement negotiations generally;
(8)preparing for a costs assessment; and
(9)attending day one of the costs assessment.

Proportionality

While self‑represented I found the applicant to be well able to understand the issues before me as raised by her solicitor and the respondent. I found her to be respectful and reasonable.
The issue of proportionality is a vexed one for the following reasons:
(1)The applicant had the right to apply under the LPA for an assessment of the costs charged to her by the respondent. The mechanism exists to ensure that costs charged can be assessed are reasonable.
(2)By filing the costs agreement in the application, the applicant expressly did not waive any rights to apply for it to be set aside, challenge its applicability or challenge it in any other way. While the costs agreement was not set aside, the entitlements to charge for certain items of charge at all and the amount charged for most of the items of the costs charged were challenged by the applicant.
(3)The aim in these proceedings was for me as the taxing officer to determine the costs properly allowable for work undertaken by the respondent for the applicant in previous proceedings. It was not an opportunity for the parties to engage in a satellite dispute with a war of attrition over entitlements such that the costs incurred exceeded the value of what should have been in dispute.
(4)The applicant's solicitor filed the objections on 8 January 2021, having had one day to consider, on 22 December 2020 at the respondent's solicitors' office, the respondent's files and formulate objections to the 797 items in the Bill despite the proceedings having been on foot for 13 months by that time. It is not apparent why that was left so late, or restricted to one day, given the objections were originally to be filed by 14 December 2020 and the time frame extended for provision of the Bill by 4 December 2020 with objections by 8 January 2021.
(5)The applicant's affidavit states that she was informed by her lawyer and believes that the material in the respondent's file, when inspected, was not chronologically ordered, some was in paper form, some electronic form and the respondent's files were subsequently modified and presented in a wholly different manner. They had been labelled and cross-referenced by item number to the Bill for purposes of the assessment. While that was of significant assistance at the assessment that would have required significant time for labelling and indexing and appears to have occurred after inspection by her solicitor, making his task of inspection and review more difficult and time-consuming.
(6)The submissions and need for arguments at commencement of assessment both as to entitlements to charge and amount of charges were inter-related. These issues had to be ventilated and determined. By way of example:
(a)The applicant submitted that intra-office conferrals were notoriously not chargeable. That is not the case as a matter of law generally and the costs agreement in this case expressly permitted the respondent to charge for reasonable time spent by practitioners conferring in relation to the matter.[25] Nonetheless each conference was considered as to appropriateness and reasonableness and typically only the senior practitioner's time had been charged for or allowed in any event.
(b)The time spent, content of and context of document preparation had to be considered and argued:
(i)Disclosure obligations in the original proceedings were ongoing and the disclosure of documents had to be updated a number of times.
(ii)The applicant claimed to have substantially prepared some documents, requiring little consideration or preparation by the practitioners, yet the practitioners had duties to the Court and to their client in relation to those documents which prevented them merely filing what was prepared by their client.
(iii)Given that some draft versions of documents were made available at the assessment which were not readily available when the applicant's solicitor inspected the respondent's physical files prior to assessment and not all of the file records could be readily located by the applicant's solicitor upon inspection of the files to consider objections, some file records required proof of time being spent or work undertaken, some were the need for proof of reasonableness of time spent or appropriateness of charge. The applicant's submissions prior to assessment stated that every draft of a document must be made available at taxation so that the incremental changes to the document can be analysed and matched against the fees charged for that change.
(7)The applicant accepted in her affidavit that some explanations and answers relating to charges could only be made by the witnesses, not available other than by subpoena, with the objections having been made on the basis of the file alone without the benefit of those explanations.
(8)Ultimately the parties to any proceedings should make every effort to work through Court processes in a reasonable and cost effective manner, proportionately to value of the dispute.
[25] Clause 2.2.

That the applicant submitted that:
It is well-known that there is a high degree of variability amongst Taxing Registrars in relation to disallowing items;
…
This is not surprising given that there is a wide discretion … exercised in determining questions of whether it is reasonable to charge at all, and if it is reasonable, what a reasonable sum is…;
…
In effect, these are discretions upon discretions, which inevitably lead to wide variability,
is not a matter in which she has the experience to make. That submission is made without evidence or foundation.
Taxing registrars are required to apply the law and appropriate rules of court, and have to determine appropriate costs in a broad range of circumstances. Solicitor and own client assessments of costs arise under legislation and either pursuant to a costs agreement as in this case or under an applicable costs scale. Party and party costs taxations arise from costs orders or rules of court for application of applicable scale costs, or in some cases special costs orders. Variability in outcomes of costs assessments and taxations arise necessarily from different applications, the relevance of costs agreements and scales, and from different factual circumstances. There is discretion in a taxing officer, necessarily, which must be exercised.
The applicant's submission suggests that the approach taken and exercise of discretion by different registrars to items which should or should not be allowed varies by a high degree. That submission is made without foundation and is not, in my experience, correct. If the discretion is misapplied, a costs assessment or taxation outcome may be reviewed by a judge.
Properly advised, and given proper costs disclosure herself by her costs consultant solicitors for the application, the applicant should have been well aware that:
(1)for her application to have the respondent's costs of representing her assessed, significant costs could be involved in the process for each party, particularly taking a line by line costs assessment approach in addition to arguing a number of issues as a matter of principle;
(2)an outcome whereby the original costs charged to her would be significantly reduced could not be assured even if there were arguments which could be advanced for her to justify having those costs significantly reduced;
(3)being entitled to recover some or all of her costs of the application and assessment could not be assured even if the costs originally charged to her were reduced; and
(4)she may be at risk of having to pay some or all of the respondent's costs of the application and assessment in addition to her own costs.
Certainly the applicant was warned during the assessment when acting in person of my concerns as to the nature of those matters.

Respondent's submissions and proposed order as to costs

Within the Bill the respondent claimed $12,000 for drafting the Bill, $7,040 for attending taxation based upon an assumption of two days at $3,520 per day, and $1,004 as a disbursement on 19 November 2020 for filing fees for the Bill.
The filing fees actually paid to the Court were:
(1)$100 by the applicant's solicitor for filing the application for assessment 22 November 2019;
(2)$518 by the respondent by the respondent's solicitors for filing the Bill; and
(3)an additional $3,311 by the respondent's solicitors 5 February 2021 being 2.5% of the Bill.
The respondent firm relied upon the affidavit of Amy Pascoe sworn 16 December 2021 and sought orders in relation to application for assessment and of the taxation itself on 8 and 15 April 2021, 26 and 27 May 2021, 6 and 7 July 2021, 6 August 2021 and 18 November 2021 that:
(1)the applicant pay the respondent's costs of the Application up to and including 16 February 2021 on a party and party basis, fixed in the sum of $25,124;[26]
(2)the applicant pay the respondent's costs of the Application from and including 17 February 2021 on a party and party basis fixed in the sum of $29,500;[27]
(3)the applicant pay the respondent's costs of the application for costs of the application, fixed in the sum of $4,000.[28]
[26] See schedule to reasons.
[27] See schedule to reasons.
[28] See schedule to reasons.
The respondent therefore seeks costs from the applicant of $58,624. The breakdown of the costs claimed are set out in the schedule to these reasons.
The respondent submitted that:
(1)There was unreasonable rejection by the applicant of five Calderbank offers made by the respondent to the applicant, copies of which were provided upon affidavit.
(2)There was unreasonable conduct by the applicant, referring to the principles applicable to an award of indemnity costs in litigation summarised in Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129(S). In particular, an indemnity costs order is an exceptional order and there must be some special or unusual feature of a matter to justify the making of such an order, such as some element of improper, or at least unreasonable conduct, by a party or a party's legal advisors.
(3)The applicant had engaged in further unreasonable conduct which included:
(a)pursuing vexatious and disproportionate litigation;
(b)requiring the need for a line by line assessment of the costs despite awareness of increasing costs of pursuing that approach as a means of settlement negotiation, in reliance upon the applicant knowing she was not incurring further costs herself as a self-represented litigant for an estimated 9 ‑ 10 day hearing as opposed to the substantial costs the respondent would incur. The applicant acknowledged and understood the significant time and costs being incurred during assessment but wished to proceed in that manner;
(c)threats made to the respondent's reputation including a reference to decisions that may be handed down to tarnish the respondent's reputation;[29]
(d)the conduct above being engaged in as a means to attempt to bolster the applicant's offers to settle the dispute on the basis of the respondent firm paying her a refund of $45,000 plus $20,000 in legal costs[30] and $39,000 plus $20,000 in legal costs;[31] and
(e)other correspondence demonstrating the applicant's unreasonable approach.[32]
(4)Notwithstanding the above conduct the respondent claimed it had been willing to explore different approaches to limit costs incurred.
[29] Amy Pascoe affidavit paragraphs 39-40 and ALP5.
[30] Amy Pascoe affidavit annexure ALP 2, offer made 7 April 2021.
[31] Amy Pascoe affidavit annexure ALP 5, offer made 11 April 2021.
[32] Amy Pascoe affidavit annexure ALP 2, ALP 4, ALP 9.
The respondent submitted in relation to the costs of the application and assessment that indemnity costs ordered is justified by the applicant's conduct. However, as a result of the substantial difference between party and party costs on one hand and indemnity costs on this occasion, the respondent only seeks those costs on a party and party basis, the total of which is $58,624.00.

Consideration of respondent's submissions as to Calderbank offers

It is commendable the parties each sought to make a number of offers of settlement to resolve the need for assessment of the Bill.
On the evidence now before me by affidavit, apart from the respondent's Calderbank offers were made by the applicant to the respondent through her solicitor on 7 April 2021 and 11 April 2021, and herself on 26 May 2021. There was additional correspondence between the parties in an attempt to narrow issues.
The respondent relies upon five Calderbank offers it made which it submits were unreasonably rejected.
The respondent's first Calderbank offer (the First Offer) was made by letter to the applicant's solicitor on 2 February 2021. This was prior to the commencement of hearing, offering that the respondent refund $15,682.62 of the $120,682.62 paid by the applicant, the application to be dismissed with no order as to costs. The First Offer was open for acceptance for 14 days and due to expire before a date had been allocated for assessment of the Bill. The Bill, objections, the response and submissions had been filed by that time, and the respondent was about to incur the taxing fee of $3,311.00 just three days later. There was a statement that the charges in the accounts were properly chargeable, but no detailed assessment of prospects of success, although that had been more fully stated in the documents filed. There was a foreshadowed application for indemnity costs.
The respondent's second Calderbank offer (Second Offer) was made by email on 7 April 2021 to the applicant's solicitor at 7.14 pm. This was on the eve of the first day of taxation, in response to a Calderbank offer from the applicant's solicitor sent at 1.52 pm that day. The respondent offered to refund $15,682.62 to the applicant, the application to be dismissed with no order as to costs. There were other terms as to payment, a deed and form of release. It remained open only until the following morning at the commencement of the assessment. It relied upon the more detailed terms of the First Offer and was said to be more favourable to the applicant as the respondent had incurred further expenses for the taxing fee and costs since that time. It foreshadowed that if the applicant sought to settle on these terms at taxation after the lapse of the offer, any costs incurred in proceeding to taxation would be deducted in considering further settlement terms. It was rejected by reply at 8.02 pm.
The respondent's third Calderbank offer (Third Offer) was made by letter to the applicant's solicitor on 13 April 2021. This was between the first and second day of taxation when both parties were aware of preliminary rulings and approach required and the likely time involved in the assessment. The offer was open for acceptance for three days. The parties also had some indication by that stage as to amounts being allowed and disallowed for items assessed by that time. The respondent offered to refund $20,000 to the applicant, the application to be dismissed with no order as to costs. The terms of the offer need to be understood in the context of other correspondence of 13 April 2021 considered further below. The terms of the Third Offer were sufficiently clear, raised some of the issues regarding prospects of success either within the letter and related correspondence, foreshadowed costs risks and an application for indemnity costs foreshadowed application for indemnity costs if not accepted.
The respondent's fourth Calderbank offer (Fourth Offer) was made by letter to the applicant herself on 26 May 2021 between the third and fourth day of taxation, the respondent offering to refund $22,500 to the applicant in full and final settlement of all solicitor and client costs issues between the parties inclusive of GST and interest. The application was to be dismissed with no order as to costs. It was open for acceptance until 9.00 am on 27 May 2021 and, it was said, would not be reinstated if it lapsed. It foreshadowed a claim for indemnity costs. While not expressly referring to it, the applicant had made a Calderbank offer to the respondent's solicitors at 6.05 pm offering to accept payment of the sum of $46,000 in settlement of the matter made orally that morning;
The respondent's fifth Calderbank offer (Fifth Offer) was made by letter to the applicant dated 6 July 2021 on the fifth day of the costs assessment and was to be further heard on 7 July 2021. The respondent offered to refund to the applicant $24,000 inclusive of GST and interest with the application to be dismissed with no order as to costs. It was open for acceptance until 9.00 am on 7 July 2021 and foreshadowed a claim for indemnity costs. It also expressly rejected an offer from the applicant to be repaid $47,000.
The Second, Fourth and Fifth Offers were not as detailed as the other offers but were similar in nature and the merits or otherwise of the issues raised had been the subject of substantial detail in the filed documents and oral submissions during the assessment.
The period for which some of the respondent's offers was open was very short, in some cases half a day, however, everything turns on the circumstances of the particular case and there is not, and there cannot be, any stipulation as to a minimum time which an offeree must have to consider an offer.[33]
[33] Pro Property Pty Ltd v Orchard Holdings Pty Ltd [2013] WASCA 283 [58] Newnes JA, Buss and Murphy JJA concurring at [1] and [83] respectively.
The issues were well understood at all stages between the parties and there were multiple offers in reliance upon the Calderbank principles from each party. It was the significant difference in assessment of the merits and risk which resulted in the parties not reaching agreement, not the shortness of time for consideration. Each party was represented by costs specialist solicitors at the time of the First Offer, Second Offer and Third Offer, and the only differences of note thereafter when the applicant was not represented was the amounts offered differed slightly.
Taking into consideration the:
(1)the stage of proceedings at which each of the respondent's offers was received by the applicant;
(2)the time allowed to the applicant to consider each offer ‑ itself not a significant issue;
(3)the extent of the compromise offered by each offer;
(4)the applicant's prospects of success, assessed as at the date of each offer;
(5)the clarity with which the terms of the offer were expressed ‑ itself not a significant issue; and
(6)whether the offer foreshadowed an application for indemnity costs in the event of rejection,
I do not consider that the applicant's rejection or non‑acceptance of each of the First Offer, Second Offer, Third Offer, Fourth Offer and Fifth Offer was unreasonable and gave rise to a justification for a special costs order to be made.
In particular:
(1)By the time each of the offers was made each party had incurred a significant amount of costs in the application. The offered refunds were substantial sums but had any of them been accepted, the applicant's costs of the application to the time of acceptance would have exceeded any refund.
(b)Whether ultimately correct or accepted as submissions for the assessment, the submissions and objections filed for the applicant made clear that the applicant should not be obliged to pay substantial amounts of the costs which she had been invoiced and paid to the respondent. If found to be correct, she would have had an assessment outcome involving a significant repayment to her and a strong justification for the respondent firm to pay her costs of the application and assessment.
(c)The applicant's solicitor's position taken in correspondence now available to me argued that as there had already been some concessions from invoiced costs when preparing the Bill, only a small additional amount needed to be disallowed on assessment for her to reach a 15% reduction of billed costs and enliven the obligation for the respondent to pay her costs of the application in addition to overcharged fees.
In any event, the respondent does not press for indemnity costs, rather party and party costs.

Other relevant correspondence

The respondent's offers also need to be considered in the context of the applicant's solicitor's correspondence.
The applicant's offer of 7 April 2021, which gave rise to the respondent's Second Offer, had sought by way of a settlement sum the amount of $4,500 per month for 10 months plus a contribution towards the applicant's legal fees and disbursements the sum of $20,000 as a lump sum. That letter had, amongst other matters, referred to the respondent facing 'serious risks' in the application, including as to:
(1)the fact there had been 61 internal conferences and charges for some documents being largely template or precedent documents;
(2)not having drafts of documents and being unable to provide an aggregated figure for those documents;[34]
(3)the necessity of an Occam's razor solution being necessary, that is, for the registrar to look at the final document and give it a figure, introducing arbitrariness and which it was said should discretion exercised in favour of the applicant; and
(4)unreasonable failure to accept the offer resulting in an application for indemnity costs.
[34] Referring to The Australasian Lawyers Group Pty Ltd t/as Butlers Barristers & Solicitors v Morgan [2018] WASC 69.
More troubling is the correspondence sent from the applicant's solicitor to the respondent's solicitor on 11 April 2021 as a Calderbank offer[35] (the 11 April 2021 Letter). That correspondence is not only context for respondent's arguments for the unreasonableness of the applicant's conduct in refusing the Third Offer but generally in support of the respondent's contentions that indemnity orders should be made due to the applicant's improper or unreasonable conduct. Directly relatable to the letter are the respondent's submissions that:
(1)the applicant has pursued vexatious and disproportionate litigation; and
(2)the applicant was aware of the increasing costs in the line by line approach, relied upon the fact she would not be incurring costs for an additional possibly 9 or 10 days of hearing after the first day, relying upon that to negotiate a favourable outcome on the basis of her understanding and willingness to proceed on a line by line basis with disproportionate costs; and
(3)the 'threats' to the respondent's reputation.
[35] Amy Pascoe affidavit annexure ALP 5.
The 11 April 2021 Letter is comprised of 60 main numbered paragraphs and many subparagraphs but contains reference under headings to a settlement offer, how the matter will proceed if the offer is not accepted, costs risks to the respondent, the 15% issue, the possibility of appeal, releases and timing of the offer. Of itself, the offer was to accept $20,000 for costs as a lump sum intended to be for costs and a further $39,000 paid by instalments, intended to be a refund of overcharges, on terms more fully set out.
Relevantly, the 11 April 2021 Letter in relation to how the matter will proceed if the offer was not accepted that:
5)My client has instructed me to convey to you, to provide context to the settlement offer, that she is likely to take over the conduct of the costs assessment herself and, in those circumstances, the matter will proceed on a line by line-item by line-item basis.
6)She is confident she can handle the matter herself and, is prepared to put in the time for the probably additional 9 or 10 days required to complete the process (this is an estimate based on the current rate of progress).
7)Thereafter, she is likely to re‑engage me and for me to go back on the record to:
a)make any arguments about the costs of the costs assessment, at the end;
b)deal with the process pursuant to Order 66, rules 53 and 54 of the Rules of the Supreme Court of Western Australia (sic) (1971) (WA); and
c)deal with any appeal that might arise, for example in relation to matters of principle.
8)Obviously, this will incur quite some expense for [the respondent] and will presumably be the subject of a costs re-estimate by you to [the respondent] for a 10 day costs assessment instead of a 2 day costs assessment.
Relevantly, it was stated in relation to costs risks to the respondent that:
9)If we extrapolate a likely overall outcome from the disallowances made on the 43 items during Day 1, it is reasonable to infer a deduction from the bill of about $9,000 or more in addition to the concessions already made.
10)However, the reason it could well be more than this, is because as the time went on during the retainer, less defensible fees become more numerous.
11)…[the respondent] has over-charged in that context.
12)In those circumstances, costs and quite possibly indemnity costs, are likely to be awarded in favour of the applicant (because of the guarantee issue previously raised, and also due to the 15% issue).

Relevantly, after setting out within the 11 April 2021 Letter comments substantially the same as the applicant's submissions as to the costs of the application regarding the 15% issue and statutory interpretation, it is then stated by the applicant's solicitor:
32)My best-guess (and I expect this will be inferred by the Court) is that:
a)the concessions in the [Bill], and in the response to the objections, were brought about because the respondent had the belief it could not mount a defensible argument in relation to those items;
b)rather than spending time, energy and money fighting what it believed to be a hopeless cause, it gave up in relation to those items and conceded them;
c)it was not a question of the respondent acting with any sense of charity, goodwill or in any other way that should mean it obtains a benefit in relation to the 15% issue.
Under the heading of the possibility of appeal the 11 April 2021 Letter relevantly states:
33)Given the weakness of the contrary argument to the proposition I am putting, even if Registrar Fatharly sided with [the respondent]:
a)on the proposition; and
b)in relation to the guarantee issue;
those questions would very likely be the subject of appeal and determination because of the lack of case law on the issues.
34)Objectively, the Registrar made some key decisions which were a departure from the norm, especially in relation to intraoffice conferrals.
35) Quite frankly, had both sides known Registrar Fatharly would be dealing with matters in this way (we had all assumed [another Registrar] would be the Taxing Registrar until less than 24 hours beforehand), it is quite conceivable [the respondent] need not have made many of the concessions it did.
36)I have the impression Registrar Fatharly would have allowed costs for both fee-earners for some of the intra-office conferrals.
37)Other similar situations may arise, as the process carries on from here.
38)I make these points because they point towards such matters of principle raising an almost certain risk for the respondent. This is because of the strong likelihood the applicant will appeal, once written reasons are provided by the Registrar on those questions.
39)[The respondent]'s reputation could be adversely affected, in a way it does not quite see coming. Such a published decision would be so determinative on unclear areas of the law, that it would become a benchmark precedent case in relation to the law of costs. Instead of referring to the '[name of case] decision', we could very well instead be referring to the 'HHG decision' and, quite possibly, in an unfavourable light.
40)No doubt articles would be written about such an important case in the Law Society's Brief magazine, as well as other similar publications and texts.
41)The applicant is prepared to agree a confidentiality clause.
Under the heading of the respondent's costs as a barrier to settlement, the 11 April 2021 Letter relevantly stated:
52)The respondent failed to ensure its staff wrote adequate time entries, in the original invoices, which could have been easily copied and pasted and generally translated into a bill in assessable form.
53)For reasons of its own, the respondent chose not to ensure its staff did so.
54)It is for that reason it has paid for your expert services (at least $12,000 for the bill in assessable form).
Under the heading of releases, the 11 April 2021 Letter relevantly stated that:
55)The applicant is prepared to provide a release in relation to [claims based upon other causes of action specified in the Letter].
56)She will otherwise be considering [claims based upon other causes of action specified in the Letter].
Under the heading timing of the offer, the letter relevantly stated:
58)The offer remains open for acceptance during the next 3 business days.
59)I anticipate if the offer is not accepted, you will be served with a notice of representation by the applicant, with her becoming self-represented on or before Thursday.
As the respondent submits, it is clear from the above letter that the applicant was aware of the increasing costs,[36] in addition to the costs of the application process discussed and acknowledged by the applicant during the hearing which she stated she understood and nonetheless sought to proceed as necessary line by line.
[36] Relying upon paragraphs 5 to 8.
The respondent's concern about the unreasonable conduct by the Application given the threats to the respondent's reputation arose directly from par 39 and par 40 of the 11 April 2021 Letter.
The applicant's intent to proceed if necessary for 9 to 10 days of assessment mostly self‑represented with intention to review the assessment outcome and appeal it on points of principle when the assessment had not even been completed gave rise to the respondent's arguments that this would bolster her settlement offers and unreasonable approach.
The respondent's solicitors wrote two replies to the 11 April 2021 Letter, both dated 13 April 2021. The first reply was the respondent's Third Offer which included reference to the fact that:
(1)The applicant was attempting to persuade the respondent to accept the offer on the basis that, if not accepted, the applicant will be self-represented, and will be content to proceed with a lengthy assessment hearing which will incur a substantial amount of costs for the respondent and not herself and in addition, irrespective of any outcome of the taxation hearing, the applicant already intends to appeal the determinations made 8 April 2021. That was not a reasonable ground for reliance upon a Calderbank offer and that type of conduct can be viewed as 'parasitic litigation' and the approach is an unnecessary waste of the Court's resources and is dangerously approaching proportionality issues.
(2)The 11 April Letter attempts to persuade the respondent to accept her offer on the basis that the reputation of the law practice is likely to be tarnished as a result of an impending appeal. While such allegation was strongly denied by the law practice, the applicant's reasoning was questionable and not a valid consideration for demonstrating the reasonableness of a Calderbank offer.
The respondent's second letter of 13 April 2021 referred in more detail to the items in the Bill and assessed to date, the possibility of a 10 to 15 day assessment with submissions and substantial costs consequences for both parties. It was stated that the costs of the taxation process itself were likely to be disproportionate to the amount of legal fees that are the subject of the dispute between the parties, and can be characterised as 'parasitic' or 'satellite' litigation.[37] It was proposed by the respondent to either extrapolate the average of amounts taxed off and apply that to the whole Bill, which at that time would have suggested a total disallowance of $8,747.56 but with some submissions, or that having had the filed objections, response and submissions and heard the parties on the first day of assessment, the files be left with me to assess before a final opportunity to address me and making of a final determination. While the general approach was a sensible one for consideration, it was not accepted.
[37] Heartlink v Jones as Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254(S) [20] Martin CJ.
It is not necessary or appropriate for me to determine whether the author of the 11 April 2021 Letter had properly formed the view that:
(1)this matter was potentially an appropriate form of test case to set precedent in relation to general principles on which there was a lack of authority, and should be the subject of review and appeal when only one day of the total eight day assessment had been completed;
(2)the intention of the applicant to appear herself and argue the matter line by line for another 9 or 10 days was an appropriate, reasonable, proportionate and necessary means for the applicant seeking an assessment of costs in all the circumstances if her offer was not accepted, knowing that the respondent would incur significant costs of defending the application and it would take up considerable court resources;
(3)there was already by that stage a departure in principle in relation to the taxation justifying the applicant's solicitor to be re-engaged for review and appeal proceedings in addition to costs;
(4)any conduct of the respondent justified the matter becoming a benchmark precedent case in relation to the law of costs for which the respondent's reputation could be adversely affected, but despite such applicant was willing to settle on the basis of confidentiality;
(5)there was a legitimate basis for a claim against the respondent for other specified causes of action which would be settled by the offer.
If it was intended that any of the comments made in the letter were an express or implied attempt to threaten or intimidate with long and expensive proceedings and risk to reputation, and made for the purpose of attempting to gain a better outcome for the applicant, that would be improper and would be an inappropriate use of a Calderbank offer. It also made it impossible to assess in the context of other potential actions, the merits of which are unknown, the reasonableness or otherwise of rejection.
Certainly, the respondent submits that the applicant's conduct is unreasonable, she has pursued vexatious and disproportionate litigation, threats were made to the respondent's reputation of adverse decisions, and the conduct has been engaged in to bolster the applicant's offers.
If by vexatious the respondent submits that the application had or has no reasonable prospects of success[38] or which is a sham and cannot possibly succeed[39] then I do not consider these proceedings to be vexatious. If, however, it is intended to suggest the proceedings were an abuse of process because of the manner in which they were pursued, disproportionately and to gain advantage in settlement or put the respondent to significant expense, it is the case that the insistence upon a line by line approach and the significant arguments with need to prove so many items was disproportionate and, combined with the 21 April 2021 Letter would have been perceived as being vexatious.
[38] Valdez v Frazer [2017] FamCAFC 18 [9] cited in Re Rules of the Supreme Court 1971 (WA); Ex Parte Gates [2018] WASC 213 [31].
[39] Pridmore v Magenta Nominees Pty Ltd [1999] FCA 152; (1999) 161 ALR 548 [24], cited in Re Rules of the Supreme Court 1971 (WA); Ex Parte Gates [2018] WASC 213 [31].
Under the Legal Profession Conduct Rules 2010 (WA) (LPCR) applicable until 1 July 2022, it was clear that a practitioner's duty to the court and administration of justice was paramount and prevailed to the extent of inconsistency with any other duty, including but not limited to a duty owed to a client of the practitioner.
The Rules contained other provisions relating to fundamental ethical obligations and conduct of a practitioner including to be honest and courteous in all dealings, to avoid compromise to the practitioner's integrity and professional independence, to comply with the Rules and the law, and not to act in any manner which may be prejudicial to, or diminish public confidence in, the administration of justice, or which may bring the profession into disrepute.[40]
[40] Rule 6.
The Rules further set out obligations for maintaining professional integrity[41] and in relation to advocacy and litigation, included obligations to confine the hearing of a matter to issues which the practitioner believed to be the real issues, and present the case as quickly and simply as is consistent with its robust advancement, and if the practitioner was aware of any persuasive authority that the practitioner reasonably believes might be against the client's case, inform the court of that authority.[42] There were obligations to ensure the responsible use of the court process.[43]
[41] Rule 16.
[42] Rule 32.
[43] Rule 36.
The obligations of the Legal Profession Uniform Law Australian Solicitors Conduct Rules which have replaced the LCPR have almost identical obligations.
While it is not for me to determine whether there has been a breach of professional obligations and whether any disciplinary action is appropriate against any practitioner, when conducting a costs assessment as a taxing officer:
(1)section 307(1) LPA provided that I must refer a matter to the Legal Complaints Committee if I consider legal costs charged by a law practice are grossly excessive. I have found that the legal costs charged were not grossly excessive;
(2)section 307(2) LPA provides that if I consider that a costs assessment raises any other matter that may amount to unsatisfactory professional conduct or professional misconduct on the part of an Australian legal practitioner or Australian‑registered foreign lawyer, I may refer the matter to the Legal Complaints Committee to consider whether disciplinary action should be taken;
(3)under s 202 Legal Profession Uniform Law I may refer to the local authority if the legal costs charged are not fair and reasonable and I must refer if I consider that the legal costs charged, or any other issue raised in the assessment, may amount to unsatisfactory professional conduct or professional misconduct.
What is necessary in relation to these reasons, however, is to determine the appropriate costs orders and costs of the application.

Costs of the costs

In my determination:
(1)It was entirely appropriate for the applicant to commence the application and seek an assessment of the costs charged to her by the respondent.
(2)In the circumstances set out in these reasons:
(a)the applicant has not achieved a 15% or more reduction from the Amended Bill to require the respondent law firm by s 304(2) LPA to pay the costs of the application and assessment;
(b)as the law practice is not obliged under s 304(2) LPA to pay the costs of the application and assessment, the costs must be paid by the party I order, as the taxing officer, to pay the costs;
(c)I order the applicant to pay the costs of the assessment, the amount of which I will determine below and allow.
(3)The costs of and incidental to the Orders of 22 October 2020 and 23 November 2020 (the 2020 Orders) which were reserved, should be considered to be costs in the cause of the application and a reasonable amount allowed for those costs. The work undertaken by the respondent of and incidental to those orders is included within the costs of the application.
If I am incorrect in my determination that the applicant has not achieved a 15% or more reduction, and I exercise my discretion under s 304 to order the applicant to pay the respondent's costs of the costs assessment, relevantly:
(1)The respondent's costs do not include the application documents. The costs claimed begin with costs for preparation of the Bill, response to objections and submissions then the hearing days and costs submissions.
(2)Appropriate concessions were made by the respondent to the costs claimed well before the assessment hearings where much of the costs were incurred.
(3)It is necessary for parties to take an approach that is proportionate and confine the hearing of a matter to the real issues, present the arguments as quickly and simply as reasonably possible.
(4)The 11 April 2021 Letter expressly or impliedly makes clear, whether by intended threat or otherwise, that a line by line approach would be taken even if that meant another an additional 9 or 10 days for assessment, without incurring the costs of solicitors in doing so that the respondents would incur, then likely have to face review and appeal processes and separate litigation. That approach was not reasonable whether represented or not.
(5)The applicant was always open to an adverse costs order and was warned repeatedly about that during the hearings when acting for herself.
I do not consider it appropriate to make any indemnity costs orders.
The respondent's submissions raise issues seeking to justify indemnity costs but not do ultimately seek indemnity costs.
As to the $58,624 of costs claimed by the respondent, I consider that the applicant should pay the respondent, and I allow:
(1)$14,278.00 of the $25,124.00 costs claimed by the respondent up to and including 16 February 2021 calculated as:
(a)$6,000 for drawing the Bill. Much of the work time and description should have been incorporated from the invoices, although I am aware from the assessment that work was undertaking reviewing the files, ensuring appropriate claims were made and essentially basic preparation for assessment. At the applicable scale rate at the time of $495 inclusive of GST, that remains over 12 hours of time allowed even at Senior Practitioner rate even though half of claimed time. The Bill was ordered by consent to be filed. The scales permit allowance for reasonable costs;
(b)$518 for the filing fee for the Bill. It was not $1,004 as stated;
(c)$7,040 combined amount for the response to objections and commencement of preparation for taxation up to 16 February 2021. It resulted in some concessions being appropriate. I allow the equivalent of a total of two days of work of respondent's counsel at $3,520 per day. That rate was used in the Bill for time estimated of attending assessment.
(d)$720 for the Submissions as claimed.
(2)$22,750 of the $29,500 costs claimed by the respondent from 17 February 2021 calculated as:
(a)$750 of the $1,500 claimed for preparation for taxation, correspondence with witness and practitioner and drafting and serving the subpoena; and
(b)$22,000 attendance and preparation days one to eight of taxation hearing, reporting to client, settlement conferrals and preparation of spreadsheet of taxed items.
(3)$3,000 of the $4,000 for the affidavits and submissions in support of the costs claimed.
Accordingly the applicant should pay the respondent's costs fixed in the sum of $40,028.00. That sum is:
(1)in the order of 68% of the respondent's claimed party and party costs;
(2)more proportionate, but nonetheless still significant, in amount in the context of the amount of legal fees and disbursements originally invoiced;
(3)reflects an appropriate reduction for the fact that the applicant was not without notable success in reduction of the fees invoiced and claimed in the assessment within the Bill and Amended Bill. Those costs were not only reduced through concessions but during the assessment of the costs;
(4)much of the material in the submissions and affidavits of each party went to the issues of unreasonable conduct and appropriateness of indemnity orders, which in the case of the respondent was ultimately not the order sought as costs were not significantly different on a scale basis.
To put that sum into context, it must be remembered that the applicant herself sought in the order of $28,000 on an indemnity basis for her solicitors' costs when they had not been required to draft the Bill and had attended only one of the eight days of the hearing of the assessment. In that context, $40,028.00 allowed for the respondent's costs seems modest but is appropriate and the amount to be allowed to the respondent upon the certificate.
In addition, the respondent paid the sum of $3,311 being 2.5% of the value of the Bill for the hearing fee, although that had included costs for the Bill and assessment. They should be allowed recovery of 2.5% of the fees allowed on the Bill.[44] Excluding the costs of the Bill and assessment, $99,831.94 was allowed. The fee recovery allowed should be $2,495.80.
[44] Supreme Court (Fees) Regulations 2002 Item 9, note 2.

Neither application of a 'pub test' nor Occam's Razor were appropriate or necessary features of these reasons. Assessments of costs are based upon detailed consideration and calculation with application of principles and appropriate exercise of discretion applying knowledge gained over many years.
The certificate to be issued should therefore reflect:
(1)fees allowed upon assessment of $99,831.94;
(2)costs of the application of $42,523.80 inclusive of disbursements and GST.

SCHEDULE TO REASONS

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
RD
Associate to Registrar Fatharly
20 FEBRUARY 2023