CITATION: | Civil Mining & Construction Pty Ltd v Wiggins Island Coal Export Terminal Pty Ltd [2024] QSC 28 |
PARTIES: | CIVIL MINING & CONSTRUCTION PTY LTD (plaintiff) v WIGGINS ISLAND COAL EXPORT TERMINAL PTY LTD (defendant) |
FILE NO: | BS No 6050 of 2013 |
DIVISION: | Trial Division |
PROCEEDING: | Review of cost assessment |
ORIGINATING COURT: | Supreme Court at Brisbane |
DELIVERED ON: | 8 March 2024 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 7, 8, 9 and 31 August 2023 |
JUDGE: | Muir J |
ORDER: | The Order of the Court is that by 4.00pm, Friday 22 March 2024, the parties are to:
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CATCHWORDS: | COSTS – COSTS ASSESSMENT – APPLICATION FOR REVIEW – COSTS ON THE STANDARD BASIS – CLAIM – COUNTERCLAIM – where the parties alleged errors in the costs assessor’s approach to whether the costs claimed were standard costs necessary or proper for the attainment of justice – whether the costs statement complies with the requirements of r 705 UCPR – whether the notice of objection complies with r 706 UCPR – whether the costs assessor provided adequate reasons. PLAINTIFF APPLICATION FOR REVIEW – COSTS ASSESSOR – WRONGFUL DISALLOWANCE – PREPARATION COSTS – COUNSEL FEES – ADEQUACY OF COSTS ASSESSOR’S REASONS – APPOINTMENT OF COSTS – CARE AND CONDUCT COSTS – whether the costs assessor wrongly disallowed costs incurred prior to the commencement of the proceeding – whether the costs assessor provided inadequate reasons – whether certain costs were necessary or proper for the attainment of justice. whether the costs assessor wrongly disallowed costs relating to expert evidence obtained in the proceeding – whether the costs relating to expert evidence were necessary or proper – whether the costs assessor wrongly disallowed costs paid for various counsel briefed in the proceeding – whether work undertaken prior to the trial as “preparation” could be capped – whether the allowance for “preparation time” should be reduced – whether the costs assessor erred in including certain items in the allowance for preparation fees. whether the costs assessor erred in reducing counsels fees – whether the costs assessors decision to limit counsels fees should be set aside – whether the costs assessor wrongly disallowed counsels costs associated with a mediation of the proceeding – whether the costs assessor made an error of law by disallowing certain fees incurred to brief new counsel – whether there was a duplication of costs – whether the costs assessor erred in making percentage reductions in counsel fees. whether the costs assessor was manifestly wrong in exercising his discretion to disallow the claim/counterclaim costs – Whether the costs assessor erred in apportioning the claim/counterclaim costs in the manner that he did – whether the costs assessor failed to give adequate reasons for his decision to exercise his discretion to disallow the claim/counterclaim costs. whether the costs assessor erred in disallowing care and conduct costs – whether the costs assessor was manifestly wrong in exercising his discretion to disallow these “Care & Conduct Costs” – whether the costs assessor failed to give adequate reasons for his decision to exercise his discretion in the way he did – whether the costs assessor erred in law by failing to provide adequate reasons – whether the costs assessor wrongly sustained an objection which led to the wrongful disallowance of the uplift under r 691(5) UCPR DEFENDANT APPLICATION FOR REVIEW – COSTS ASSESSOR – ADEQUACY OF PARTICULARS – OBJECTIONS – LIBAILITY FOR COSTS – whether the costs assessor erred in allowing certain cost items for “examining various documents” – whether there were adequate particulars to support a reasonable assessment that the work claimed by certain items were necessary or proper. whether the costs assessor erred in rejecting certain objections – whether those errors would warrant the court making orders under r 742 UCPR to refer the costs items back to the costs assessor for reconsideration. whether the costs assessor erred in his decision relating to the liability for costs of the assessment and the cost of his fees – whether the costs assessor took into account an incorrect and irrelevant consideration. Building and Construction Industry Payments Act 2004 (Qld) Civil Proceedings Act 2011 (Qld) s 78, s 79 Uniform Civil Procedure Rules 1999 (Qld) r 416, r 472, r 679, r 691, r 702, r 705, r 706, r 742 Supreme Court (General Civil Procedure) Rules 2015 (Vic), r 63.34.3 Alucraft Pty Ltd (in liq) v Grocon Limited [2001] VSC 477 Assets Development Co Ltd v Close Brothers and Co. [1900] 2 Ch 717 Attorney-General of New South Wales v Kennedy Miller Television Pty Ltd (1998) 43 NSWLR 729 Australia & New Zealand Banking Group Ltd v Alirezai (No 2) [2002] QSC 205 Australian Coal and Shale Employees Federation v The Commonwealth (1953) 94 CLR 621 Barristers’ Board v Palm Management Pty Ltd [1984] WAR 101 Bartlett v Higgins (1901) 2 KB 230 Civil Mining and Construction Pty Ltd v Wiggins Island Coal Export Terminal Pty Ltd [2017] QSC 85 Clark v Malpas (1863) 31 Beav 1253 Clark, Tait & Co v Federal Commissioner of Taxation (Cth) (1931) 47 CLR 142 Club Marconi of Bossley Park v AVR Services NSW Pty Ltd [2002] NSWSC 584 Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337 Commission v Nation (1995) 57 FCR 25 Drew v Makita (Australia) Pty Ltd [2009] 2 Qd R 219 Electricity Generation Corporation t/as Verve Energy v Woodside Energy Ltd (2014) 251 CLR 640 Ernest v Partridge (1863) 2 New Rep 232 Gladstone Area Water Board v AJ Lucas Operations [2015] QSC 52 Green v Hoyle [1976] 2 All ER 633 Hennessey Glass and Aluminium Pty Ltd v Watpac Australia Pty Ltd (2007) QDC 057 Higgins v Nicol (No 2) (1972) 21 FLR 34 House v The King [1936] 55 CLR 499 Hunter v Hunter [2015] QSC 181 Innes v The Electoral Commission of Queensland & Ors [2022] QSC 122 Innes v Electoral Commission of Queensland & Anor [2023] QCA 88 Jenkins v GJ Coles & Co Ltd [1993] 1 VR 155 King v Allianz Australia Insurance Limited [2015] QCA 101 Laming v Jennings [2018] VSCA 335 Levetus v Newton (1883) 28 Sol. J. 166 McCoombes v Curragh Qld Mining Limited [2001] QDC 142 Menegazzo v PricewaterhouseCoopers [2017] QSC 172 Midway Oil and Storage v Continental Contractors (1929) AC 88 Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 Nashvying Pty Ltd v Giacomi [2009] QSC 31 Pathway Investments Pty Ltd v National Australia Bank Limited [2012] VSC 97 Picamore Pty Ltd v Challen [2015] QDC 67 Pinehurst Nominees Pty Ltd v Coeur De Lion Investments Pty Ltd [2015] QSC 122 Re Feez Ruthning’s Bill of Costs [1989] 1 Qd R 55 Remely v O'Shea & Ors (No 2) [2008] QSC 218 Rivington v Garden [1901] 1 Ch. 561 Russells (a firm) v McCosker [2018] QDC 080 Schmid v Skimming [2020] VSC 493 Smith v Madden (1946) 73 CLR 129 Swan v Bank of New Zealand (1890) 24 SALR 20 The City of Warrnambool v Tabone, unreported, 25 August 1992 BC9203233 Thompson v Cavalier King Charles Spaniel Rescue (Qld) Inc [2020] QCA 2 Toomey v Scolaro’s Concrete Constructions Pty Ltd (in liq) [2001] VSC 477 W & A Gilbey Ltd v Continental Liqueurs Pty Ltd (1964) NSWR 527 Wide Bay Conservation Council Inc v Burnett Water Pty Ltd (No 9) (2011) 194 FCR 250 Wiesac Pty Ltd v Insurance Australia Ltd (No 3) (2021) 7 QR 642 Wiggins Island Coal Export Terminal Pty Ltd v Civil Mining & Construction Pty Ltd [2001] QCA 8 Williams v AusNet Electricity Services Pty Ltd (No 3) [2017] VSC 528 |
COUNSEL: | B O'Donnell KC with B Wacker for the plaintiff P L O'Shea KC with S Eggins for the defendant |
SOLICITORS: | Thomson Geer for the plaintiff Corrs Chambers Westgarth for the defendant |
Part one: Overview
The applications
Grounds of review
The substantive proceedings
Applications for Review
“742Review by court
…
…
…
[Underlining added]
Costs on the standard basis
“1. WICET pay CMC’s costs of the claim.
“costs of the proceeding mean costs of all the issues in the proceeding and includes—
“702Standard basis of assessment
Note—
Costs on the standard basis were previously party and party costs— see rule 743S (Old basis for taxing costs equates to new basis for assessing costs).
“[6] [A] distinction is drawn between the words ‘necessary” and “proper”…The test is to be applied by reference to the circumstances that existed when the costs were incurred, and the defendant should not be penalised for incurring costs that were reasonably and proper at the time but which, with the benefit of hindsight, may not have been strictly necessary given the eventual course of the proceeding.” (Footnotes omitted)
“A taxing officer in a party and party taxation should allow a successful litigant, in whose favour an order for costs has been made, a just and reasonable amount in respect of each item claimed in such litigant’s bill of costs where such item was, in fact, incurred on behalf of the litigant by his solicitor in respect of some step or matter in the litigation which either (i) was necessarily taken or performed for the attainment of justice or the maintaining or defending of the litigant’s rights in the circumstances of the particular case, or, (ii) although not necessarily taken or performed for such purposes, would reasonably have been taken or performed for any of those purposes by a solicitor acting at the time when it was taken or performed without extravagance in conformity with the then situation of the case and not in conflict with the statutes and rules, the practice of the court, and the usages of the legal profession appertaining to such a case.
In determining whether an item of costs is “necessary” or “proper”, the taxing officer would have regard to the facts in issue between the parties’ litigation as disclosed by the pleadings and to all facts which render probable the existence or non-existence of the facts in issue including those matters which would affect the weight or credibility of any such facts. But, in making his decisions upon these matters, the taxing officer should place himself [or herself] in the position of the solicitor sitting in his [or her] office chair engaged in the task of preparing the case for trial and, to use the words of Sachs J in Francis v Francis and Dickerson at 96: “…in particular, care must be taken not to be affected by what is colloquially termed ‘hindsight’.” The question of the necessity for or propriety of any item of costs should be judged by the state of things known or which ought reasonably to have been known to a diligent solicitor at the time when the expenditure was made, or the liability therefore was incurred.”
[Underlining added]
The Costs Statement and Notice of Objection
Costs statement
[Underlining added]
“[60] I have examined each of the two costs statements. Each of them lists in chronological order the items of costs claimed, noting the date, assigning a sequential item number. Each has a description for each item and the sum claimed as the costs for it (which are divided between disbursements and professional fees). Each has a cumulative sub-total at the bottom of each page. At the end of each costs statement, there is a total of outlays and a (grand) total of outlays and professional fees.
[Underlining added]
Notice of objection
“706Objection to costs statement
[Underlining added]
[Underlining added]
Verification process undertaken by the costs assessor
“[24] There was a general objection in relation to a large number of items in the invoices that the amount of times claimed to have been spent on a particular task was excessive and unreasonable, and many of the items were reduced on this basis, although a number of items were reduced on the related basis that the material on the file did not adequately demonstrate that the amount of time claimed had in fact been spent on that item. That is really a separate point. The onus is on the practitioner to show that there is an entitlement to charge the amount sought to be recovered for the legal services performed, and to justify by file notes or other appropriate means the amount of the charge by showing that it does reflect legal services actually provided. If the amounts claimed are not adequately documented, it follows that the claims must be disallowed, or allowed only to the extent that they are properly documented, unless it is apparent from other material or the logic of the situation that some amount of time must have been spent on the task in question.”
[Underlining added]
The assessment process
“706 Objection to costs statement
“720 Procedure on assessment
…
[Underlining added]
“721Discretionofacosts assessor
In assessing costs, a costs assessor must consider the following—
Adequacy of Reasons
“…The assessor is not in the same position as, say, a judge who is required to set out, in some detail, the reasoning behind the making of findings.”
Part two: CMC’s application for review
Ground one: pre-commencement costs
Inadequacy of reasons
Critical Control and adjudication costs
The other costs
Ground two: the Mitchell Brandtman costs
Reason one: Hindsight is a wonderful thing
Reason two: Mitchell Brandtman’s work was used by Aquenta
Ground three: Counsel costs
Did the costs assessor ask himself the right question from the outset?
Mr O'Donnell KC’s fees
“Objection sustained. Objection $9,000 per day Reading and preparation, a deduction of 33%. Allow for 36 days preparation only. Fees incurred before Trial in total $449,250. Equals 44.9 days. The resolution for allowing 36/44.9* 24250*(1 - 0.33)* 0.9 = 11,724.25 which is Less than what Corrs allowed to. Therefore, apply for the value which Corrs allowed to.”
Reduction of daily rate
Pre-trial preparation and cap of 36 days
Allowance for preparation time
“16.1 WICET’s surprise at the quantum of CMC’s counsel’s fees is artificial and hyperbolic. It is unlikely that WICET, having engaged similarly qualified and multiple counsel, has incurred any lesser fees.
…
…
[Underlining added]
Preparation for trial work
as part of his allowance for preparation fees, notwithstanding that such tasks were plainly not preparation for a trial.
Arbitrary reductions
Mr Doyle KC’s fees
Capping of daily rate
“Mr Doyle QC’s fees are plainly extraordinary and excessive. CMC was of course free to elect and engage Mr Doyle QC. However, it would have done so knowing his rate was far and above the usual rate. It cannot recover an indemnity on that basis.”
Mediation costs
“…did not reflect that agreement nor any basis to otherwise disallow the costs, particularly given the definition of “costs of the proceeding” in UCPR r 679, which extends to unsuccessful negotiations for the settlement of the dispute.”
Mr Holt KC’s fees
Mr Websters fees
“I suspect that the original notion of a fee on brief was based on the idea that a barrister was essentially paid for his work in court, on the assumption that relatively little in way of preparation for the trial would be necessary beforehand, although there would usually be a conference as well. That was no doubt reasonable enough in the old days then most litigation was so simple that all a barrister had to do was read his brief and go into court, but it is an entirely inappropriate approach when dealing with modern litigation with the complexity of the issues which were involved in the hearing of this matter. Accordingly, it was quite wrong for the registrar to say as he said (para 311) that one of the reasons why the fees were excessive were that “the work for which the fees have been incurred occurred on 5 September 2001”. That in my opinion is an attitude to the assessment of fees which is obsolete and should be abandoned. In such a matter, counsel is expected to work in preparation for trial before the day of trial, it is reasonable or proper for that to be paid for, and it is part of costs assessed on the standard basis.”
(Footnotes omitted) [Underlining added]
Ground four: the claim and counterclaim costs
Inadequacy of reasons
Basis upon which the costs order was made
Analysis
Event | Sub-event | Total Length | Final Certificate | Variation 30 (OLC claim) | Other/ comment |
Witness - Lay - WICET | Athol Webb | 4 | - | - | - |
Witness - Lay - WICET | Stephen Cole | 9 | - | - | - |
Witness - Lay - WICET | David Armstrong | 6 | All (100%) |
| Mr Armstrong’s witness statement was converted to affidavit and went into evidence as Exhibit 423 |
Witness - Lay - WICET | Stephen Armstrong | 6 | All (100%) |
| Mr Armstrong’s witness statement was converted to affidavit and went into evidence as Exhibit 424 |
Witness - Lay - CMC | Ben Vance | 17 | 3 (17.5%) | 1 (5%) | - |
Witness - Lay - CMC | Matthew Grey | 5 | - | - | - |
Witness - Lay - CMC | John Henderson | 7 | 1 (14.3%) | - | - |
Witness - Lay - CMC | James Barry | 4 | - | .25 (6%) | - |
Approach to the percentage reduction
Cost item | Amount claimed | Objection |
| Objection | Objection in the alternative | Notes of Costs Assessor | Costs not allowed |
Examining and collating documents in preparation for taking James Barry’s statement (EK engaged 228 minutes) | $1,117.20 | $1,117.20 |
| See general objection 1B - insufficient detail as to what is being examined to justify the claim of nearly 4 hours. | See general objection 6 - reduce by 6% - Mr Barry. | Objection sustained, reduction by 6% | $67.03 |
Failure to consider the relevant documents
“9.11 The assessor (with the benefit of CMC’s file) is in a unique position to examine the costs CMC incurred in addressing the counterclaim and make appropriate reductions (and not guesses). In considering these costs, CMC submits that the assessor should note that the costs incurred by CMC in relation to the counterclaim were few, as much of the counterclaim was WICET simply pleading the return of moneys paid in the adjudications for the items CMC claimed in the proceedings. As a result there were no significant factual, legal or technical disputes unique to the counterclaim. This is evidenced in the pleadings and in the trial decision as set out below.”
Disallowance of items before counterclaim
Ground five: Care and conduct costs
“The plaintiff submits and relies on the submission provided as a preamble to the Costs Statement that the matter was one of substantial complexity and importance to the parties and warrants an allowance as allowed for in UCPR 691(5) & (6) in an amount of 30%”.
“General Care and Conduct included in this claim are instructions generally throughout the proceeding including allowance for all attendances and perusals not herein specified, general care and consideration at 35% given the nature and importance of the matter, the issues involved, the parties involved, the extent of the material involved, time necessary engaged in research and consideration of facts and law, skill care and responsibility (35% of $4,542,786.79)”; and
General care and conduct claimed in relation to work undertaken in the assessment of costs in accordance with paragraph 19 of Remely v O'Shea & Ors (No 2) [2008] QSC 218 at 35% of $119,457.90 (Items 19402 to 19433 only)”.
Legal principles: care and conduct
…
[Underlining added]
“General care and conduct
In addition to an amount that is to be allowed under another item of this schedule, the amount that is to be allowed for a solicitor’s care and conduct of a proceeding is the amount the registrar or a costs assessor considers reasonable, in accordance with any guidelines issued in a practice direction by the Chief Justice and having regard to the circumstances of the proceeding, including, for example—
[Underlining added]
“[6] The relevant principles have been discussed in a number of cases. In Jenkins v G.J. Coles & Co, Hayne J held that the Rule required that special grounds arising out of the nature and importance, or the difficulty or urgency of the case be established. In City of Warrnambool v Tabone in the judgment of the Full Court, Fullagar J held that the Rule was confined to cases “where the nature and importance or the difficulty or the urgency gives rise to some special ground, over and above the importance or difficulty or urgency itself, for ordering that the charges available in accordance with the scales in the appendices should be increased.” His Honour added:
“…merely to say that the case has been especially difficult and substantial is only to say that it was very difficult and substantial. The Rule requires something over and above difficult and substantial which arises out of the difficulty and substance and something which is special in its character or very much out of the ordinary…”
[7] In Alucraft Pty Ltd (In Liq) v Grocon Ltd, Smith J held that notwithstanding the fact that the case was long, hard fought and had issues requiring considerable preparation: “it must be shown that there was something more and significantly more involved than simply the conduct of heavy litigation.”
[8] This case ran for some 57 days. There were many witnesses and at various times up to ten defendants actively participated through counsel. There were a multitude of issues, both legal and factual, and responsibilities of counsel and solicitors for the plaintiff, I have no doubt, were considerable. It was “heavy” litigation in those senses, and I would not be surprised if it was concluded by the Taxing Master that recognition need be given to that when allowing particular items claimed on costs. This Rule is concerned with an application to increase solicitor’s charges. Counsel for the plaintiffs indicated that when the matter comes before the Taxing Master it is likely that allowance will be sought for three counsel and also for daily preparation fees to be allowed for counsel.
…
[11] In my opinion, this is a case which could be deemed special for the purpose of Rule 63.34. It is appropriate that the Taxing Master have the authority to increase the solicitor’s costs by reference to the Rule if he so rules, and then deems it appropriate to make any such allowance. His decision will depend on the evidence presented to him, having regard to the principles discussed above. The application to him for a general increase in solicitor’s costs may be accompanied by applications, in the exercise of his general discretions under the Rules, to allow for three counsel and for daily preparation fees. In the event that such evidence is provided it is a matter for the discretion of the Master as to whether to make such allowances.”
(Footnotes omitted) [Underlining added]
Alleged errors
“CMC improperly claims two uplifts on its professional fees:
In the premises, a total of $2,680,121.06 is claimed in the Costs Statement for uplift fees. This equates to just under 25% of the total costs and outlays claimed in the Costs Statement.
For the following reasons, there is no basis for the additional amount claimed by CMC at item 19400.
First, the claim is duplicative. The claim pursuant to r 691 of the UCPR duplicates the claim under Item 1 for care and conduct. Both cannot be claimed. That the two items are duplicative is apparent from a textual analysis. Rule 691(5) applies if the “nature and importance, or the difficulty or urgency, of a proceeding…justify it”. Scale Item 1 is to compensate a party for “complexity”, “difficulty and novelty”, “importance of the proceeding” (among others).
Secondly, the proper application of the Scale requires any uplift to be pursuant to Scale Item 1. Rule 691 of the UCPR was introduced by the Uniform Civil Procedure Amendment Rule (No. 4) 2007 (Qld) and took effect on 1 January 2008. Subsequent to that date, the Court has prescribed the uplift that should be applied to the Scale in the complex matters: see Practice Direction 22 of 2018 issued by the Chief Justice on 10 September 2018. This matters fits within section D of the Practice Direction, such that a percentage uplift of between 25% and 35% is appropriate. CMC claims that uplift at items 19401 and 19434.
Thirdly, and in any event, there are otherwise no exceptional circumstances in these proceedings, including in relation to its nature and importance, or the difficulty or urgency of the proceedings, which justify an uplift pursuant to r 691(5) of the UCPR (at all or over and above that allowed at Scale under Item 1 for general care and conduct). This was a large heavily contested case, but not an unusually complex one.
Fourthly, and in any event, for the purposes of r 691(5), the “justice of the case” does not require an increase to the Scale (over and above care and conduct). In that regard:
“Because of the great disparity between the claim made by the plaintiff for the sum of $4,795,000 in the statement of claim at
the commencement of the trial and the sum of $538,707 (before interest under s 57 of the Insurance Contracts Act) for which it has been successful, the justice of the case does not require an order under r 690(5) of the UCPR increasing the solicitor’s costs allowed in the assessment of the plaintiff’s costs of the proceeding.”
Fifthly, CMC did not seek a r 691(5) increase during the costs hearing. If it was to be sought, it should have been sought at the time. Flanagan J was in the best position to determine if the circumstances of the case warranted it. Instead, his Honour awarded CMC the costs of the claim - such costs to be assessed on the standard basis.”
Did costs assessor even consider the question of a further uplift?
Duplication
“There is considerable overlap between the language governing the discretion utilised in r 63.34(3) to justify an increase in costs allowable and that utilised in r 63.38(2) vis-a-vis the taxing officer’s exercise of discretion as to quantum. It follows that, to avoid double dipping, an order for a loading under r 63.34(3) must be taken into account when assessing whether a loading under r 63,48 is appropriate: Williams v AusNet Electricity Services Pty Ltd (No 3) [2017] VSC 528 at [27] per Wood AsJ (who, having allowed the maximum 30 per cent loading under r 63.34(3), perceived little work left for r 63.48 to do, and so allowed only a 5 per cent loading under the latter provision, given the volume of documents: at [34] to [37].”
“[27] The discretion to be exercised under r 63.48 is premised with the words Except where these Rules or any order of the Court otherwise provides. The question could be posed Is the wording of r 63.34(3) together with a finding and exercise of a discretion in relation to all those same matters otherwise providing for the purpose of r 63.48? On the assumption that the factors exist to satisfy and justify the maximum under r 63.34(3) of 30%, is there double dipping for these factors by adding a further loading under r 63.48? The wording except where these Rules or any order of the Court otherwise provide clearly accommodates the situation where allowances for the same factors elsewhere via r 63.34(3) impacts on any ability to make an allowance for the same matters in r 63.48. An order for a loading under r 63.34(3) therefore has to be taken into account when assessing whether a loading under r 63.48 is appropriate.
…
Conclusion
[Underlining added]
“First the scale loading provided for in the rules applicable for the skill care and attention, a matter ordinarily in the discretion of the Court in the application of the costs rules. Ms Dealehr ultimately assessed this at 30%. Second the special grounds loading also at 30% as provided for in the costs agreements relying on Rule 63.34. If both of these loadings apply, then duplication should be avoided.”
[Underlining added]
“In the Supreme and District Courts, the factors listed for consideration by the court under r 691(5) are factors already taken into account under item 1 of the respective courts’ scale of costs. It is submitted that justice would not be done by doubly rewarding the solicitor for the same factors — once under r 691(5) and once under item 1 of the scale. Accordingly, where an allowance is made by the Supreme and District Courts under r 691 (5), it is submitted that the costs assessor would take this into account in deciding what further allowance, if any, is warranted under item 1.”
Summary of conclusions as to these errors
Item 19400: uplift under UCPR 691(5)
R 63.34(3) is in the same form as 0.65, r 9 of the English Rules current in the late nineteenth century. Apparently that rule was made in order to assimilate practice between the common law and chancery sides in Britain. In Williamson v North Staffordshire Railway Co (1886) 32 Ch D 399, Bowen LJ said, at p. 401, in the course of argument in that case: "This is an important question, and I believe there has been a difference in practice between the Common Law and the Chancery Divisions. On the common law side it has been almost impossible to get costs on the higher scale. I remember a very complicated and difficult case in which the Duke of Norfolk was a party, which involved questions of law, and the Court refused costs on the higher scale. The rule seems to have been intended to assimilate the practice of the two Divisions." However this may be, the words of the rule indicate that what must be shown is special grounds arising out of the nature and importance, or the difficulty or urgency of the case. Cotton LJ, at p, 402, in giving the judgment of the court in Williamson's Case, said: "Although this case is one of importance and of extreme difficulty I do not think that there are in it special grounds arising out of the nature and importance or the difficulty or urgency of the case. I have great difficulty in understanding the meaning of the rule, and it is not necessary for us to determine its construction, but I think that in the present case, though important and' difficult, there are no special grounds arising out of its importance or difficulty to justify us in giving costs on the higher [sic] This approach to the rule adopted in Williamson's Case was repeated by the Court of Appeal in England in Paine v Chisholm [1891] 1 QB 531. In that case. Lord Esher MR said, at p. 534: "In my opinion the application of this rule giving power to allow costs on the higher scale ought to be strictly limited. I think that the proper rule of conduct with regard to the exercise of the discretion should be a strict rule."
[Underlining added]
“It was maintained here and below that this was a "heavy case". I am prepared to deal with the appeal upon the footing that it was a "heavy case"...But it must be said at once that there are very many very heavy cases that are not sufficiently special or out of the ordinary in their characteristics or requirements to qualify under the rule.
I am quick to acknowledge that over the last two decades the work of our profession in all its branches, including the Bench, has become steadily more difficult and more demanding.
But decisions of high authority and respectable antiquity show that the Rule now in question requires, in addition to difficulty and heavy burdens, a quality of "speciality", of being something out of the ordinary, other than and in some way arising from onerousness or difficulty or urgency or character of the case in question.
The Rule appears to have been in existence, in the same form as it now appears in Victoria, from the very enactment of the Judicature Act in England, and the scope of the Rule has been authoritatively delineated in the Court of Appeal in England by what I might call, with respect, very strong courts in the late nineteenth century. In my opinion there is no reason shown for departing in this State and in this era from the construction of the Rule so laid down. The identical English Rule has been construed in a way which not merely confines it to cases which are important or difficult or urgent, but confines the existence of the discretion to a class of cases where the nature and importance or the difficulty or the urgency gives rise to some special ground, over and above the importance or difficulty or urgency itself, for ordering that the charges available in accordance with the scales in the appendices should be increased. This conclusion is made perfectly clear in the judgment of Cotton LJ with which Bowen and Fry LJJ concur, in Williamson v North Staffordshire Railway Co [1886] 32 ChD 399. The ratio decidendi of their Lordships in dismissing an application for an allowance under the Rule is contained in the following very short reasons of Cotton LJ at p 402:
“Although this case is one of importance and of extreme difficulty I do not think that there are in it special grounds arising out of the nature and importance or the difficulty or urgency of the case. I have had great difficulty in understanding the meaning of the rule, and it is not necessary for us to determine its construction, but I think that in the present case, though important and difficult, there are no special grounds arising out of its importance or difficulty to justify us in giving costs on the higher scale.”
[Underlining added]
“The trial lasted for twenty-one hearing days. Thirty-seven witnesses ware called, twenty-eight of them on behalf of the infant respondent. The respondent's solicitor said that he took proofs from twenty-two further witnesses who ultimately were not called. The matter was contested on all issues and, as the learned judge put it, there was a very real question of liability involved in the case, including whether the plaintiff himself voluntarily dived from the bridge. There was also a great deal of evidence going to damages, especially in the area of future economic loss.
In an affidavit in support of the application of the respondent pursuant to r 63.34 the experienced solicitor for the respondent deposed that he had been in practice for over fifteen years in the personal injuries jurisdiction for plaintiffs and defendants, and that he had conducted a number of lengthy trials in the Supreme Court, and he deposed that this case was tire most difficult and complex that he had ever undertaken.”
“... I doubt if there could have been a more hard fought trial and in each of the cases the factual and expert matters involved much detail and considerable preparation both before and during the hearing. To obtain orders under either rule, however, it is necessary for the plaintiff to show some other special feature or features in the litigation which warrant such an order. It must be shown that there was something more and significantly more involved than simply the conduct of heavy litigation.”
[Underlining added]
Summary of findings: Item 19400
Item 19434: Uplift of 25 per cent on costs
“General care and conduct claimed in relation to work undertaken in the assessment of costs in accordance with paragraph 19 Remely v O'Shea & Ors (No 2) [2008] QSC 218 at 35% of $119,457,90 (Items 19402 to 19433 only).”
“Although an amount for care and consideration was claimed in the bill up to the time of the preparation of the costs statement I can see no good reason why a further modest amount could not have been allowed for the work subsequently required, It was apparent that some work had been in fact required — including an attendance on the registrar for directions. Mr Remely attempted to adjourn that directions hearing. Attendance at a hearing where there is dispute must of necessity involve factors that legitimately attract such a fee.”
Part Three: WICET’s application for review
Ground one: Lack of particulars
Examining or comparing documents
9 Examining a document or comparing documents, if perusal is unnecessary—
Analysis
Conclusion: ground one
Ground two: rejection of WICET’s objections in General Objection 1B
Costs assessor’s reasons
“1 …WICET’s submissions that:
2 In respect of General Objection 1 in the notice of objection, please provide reasons in respect of:
…
6 Please provide reasons in respect of each item in Annexure B.”
“The term ‘Examining’ as depicted in paragraph 9 of the Scale precedes billable items for ‘Correspondence (17)’ and is thus to be applied to other types of work and does not include for example, perusing. One such use deployed by the Plaintiff was for the purpose of drafting. Whilst this (only) may have been a generous application of Scale, it also may not have been, as this litigation was document intensive. Similarly, the Plaintiff applied the term ‘Examining and Considering’ and ‘Examining in order to settle’.
The Defendant will observe from my Reasons that I have not allowed all of such claims by the Plaintiff and have sought a balance, appropriate to the endeavour claimed. My view is that the imprecision of the term ‘Examining’ in the Scale, requires rectification.”
[Underlining added]
“Reasons: Please refer to my reasons set out in the attached Assessment and paragraphs 12 and 13 below.”
“Rule 722 of the UCPR directs a Costs Assessor to limit an assessment to a resolution of matters raised in the Notice of Objection.
The Defendants [sic] Notice of Objection comprised two parts, namely Submission comprising 82 pages (attached) together with specific objections. I found the dual format and particularly the Submission failed to comply with rule 706 of the UCPR, e.g. the use of terms such as ‘see General Objection 1’ (etc) and in which such general objections contained a number of varying arguments, to my mind, failed the requirement of the Rule. General Objection 1B, for example is 18 pages long. It is inappropriate to require a costs assessor to have to find a foot to fit the shoe. I discounted the Defendant’s Submissions, accordingly.”
[Underlining added]
Error one: Improper rejection of the dual form objection
Item | Description | Objection | Outcome |
61 | Examining various documents in preparation for drafting… | See general objections 1A , 1B and 4 | Objection sustained insufficient clarity |
64 | Examining and considering interim Analysis… | General objection 1B - settling | Objection sustained seems like duplication |
87 | Examining and considering Piling Variation Report… | General objections 1B and 4 | Objection sustained not necessary |
100 | Examining various documents in preparation for drafting… | As above. See also general objection 1B | Objection sustained insufficient information |
122 | Examining various documents in preparation for drafting… | See general objections 1B and 4 | Objection sustained. Claim too vague |
562 | Examining and collating various documents in preparation for drafting… | See general objection 1A and 1B | Objection sustained allow clerk rate |
574 | Examining and considering additions to the instructions to… | Appears excessive for one folio…See general objection 1B | Objection sustained. Appears excessive for review of one folio… |
692 | Examining further documents in preparation for drafting… | See general objection 1A and 1B | Objection sustained reduction |
738 | Examining and considering supplementary brief to Queen’s Counsel… | Excessive and unreasonable…see also general objection 1B | Objection sustained on balance |
759 | Examining and considering Memo in order to settle… | See general objection 1B - settling | Objection sustained appears duplication of previous work |
812 | Examining various document in preparation for drafting… | See general objection 1A and 1B - insufficient details provided as to what is being examined… | Objection sustained, draft various documents appear to be duplication |
817 | Examining and considering brief to Junior Counsel in order to… | See general objection 1B - settling | Objection sustained duplication of work |
849 | Examining and considering Request for Further and Better Particulars… | See general objection 1B - settling | Objection sustained misapplication of scale |
854 | Continued examining various documents… | See general objection 1A and 1B - again no detail provided | Objection sustained as stated |
855 | Continued examining various documents… | See general objection 1A and 1B - again no detail provided… | Objection sustained as stated |
930 | Examining documents enclosed therein including considering… | See general objection 1A and 1B | Objection sustained misapplication of scale |
Error 2: Improper application of the Scale
Meaning of relevant scale items
Drafting documents
4 Drafting a document - for each 100 words | 24.45 |
Producing documents | |
5 Producing a document in final form - for each 100 word | 5.90 |
… | |
Perusing documents | |
8 Perusing a document - for each 100 words | 5.90 |
Examining or comparing documents
9 Examining a document or comparing documents, if Perusal is unnecessary -
“…Take an example. Assume the solicitor is to draft a Statement of Claim. The solicitor will examine many documents in order to put the solicitor into a position to be able to compose the paragraphs of the Statement of Claim. Assume it takes the solicitor 4 hours examining documents in order to be able to compose the Statement of Claim. It then takes the solicitor 3 hours to draft the Statement of Claim, which is 25 pages long, and then the solicitor types the Statement of Claim (proof reads) and then issues the Statement of Claim. The appropriate charges under the scale would be:
Examining for the purpose of drafting
Claim item | Item description | WICET’s submission in the notice of objection | Costs assessor’s reasons |
Costs Statement Item 511 | Examining various documents in preparation for drafting Notice of Dispute and Appendix A to Notice of Dispute (engaged 330 minutes) | The entry is dated 27 May 2013. The Costs Assessor will note the lack of particularity in the claim (ie “Examining various”) CMC separately claims for drafting the Notice of Dispute at Costs Statement item 512 (10 folios). It also separately claims the producing rate at item 513. An available inference is that Costs Statement item 511 is an improper claim for indemnity reimbursement of solicitor drafting time. The Assessor is invited to check CMC’s solicitor’s invoices / time records for work on 27 May 2013 in relation to drafting the notice of dispute. If the work in the invoices / time records is described as drafting, it is not examining various”, “in preparation for drafting”. “ | Objection denied, appears relevant to litigation. |
Costs Statement Item 5555 ($1,029) | Examining various documents in preparation for drafting Chronology in respect to the Bebo Arch claim for the purposes of briefing King Planning (EK engaged 210 minutes) | The entry is dated 3 March 2015. EK is presumably a fee earner at CMC’s solicitors. Separately, CMC claims for drafting the Chronology of Events at Costs Statement Item 5556 (5 folios). It also claims for producing the document at Item 5557 (5 folios). An available inference is that the claim is an improper claim for reimbursement of solicitor drafting time which is not permitted at Scale on the standard basis. The Assessor is invited to check CMC’s solicitor’s invoices / time records on 3 March 2015. | Objection denied, insufficient particulars |
Costs Statement Item 16479 ($3,145.80) | Examining various documents in preparation for amending Closing Submissions (Bebo Arch delay) (SS engaged 10 hours 42 minutes) | The entry is dated 21 August 2016. CMC’s closing submissions were filed on 19 September 2016. WICET understands “SS” to be Shannon Schwarz - a Senior Associate at the time at CMC. There are many claims of this nature. An available inference is that Costs Statement Item 16479 is an improper claim for reimbursement of solicitor drafting time which is not permitted at Scale on the standard basis. The Assessor should check CMC’s solicitor’s invoices / time records for work on 21 August 2016 in relation to Mr Schwarz. | Objection sustained. |
Costs Statement Item 18101 ($1,675.80) | Further examination of documents in preparation for drafting schedule of on-site overheads (CH engaged 5 hours 42 minutes) | The entry is dated 19 July 2017 (ie the post-trial period). “CH” is presumably a fee earner at CMC’s solicitors. CMC separately claims for drafting and producing the schedule of on-site overheads: see Costs Statement Items 18126 and 18127. | Objection sustained. |
|
| An available inference is that Costs Statement Item 18101 is an improper claim for reimbursement of solicitor drafting time which is not permitted at Scale on the standard basis. The Assessor is invited to check CMC’s solicitors’ invoices / time records for work on 19 July 2017 in relation to “CH”. |
|
“And we say the costs assessor had to consider this material, because if one sends a bill to the client saying, “We spent three and a-half hours preparing your chronology,” that’s inconsistent with the notion that various documents were being examined on that day for that period of time in order to prepare a chronology. Now, we say there’s no evidence that the costs assessor has taken this into account, because otherwise he would have had to have reconciled this entry in the invoice with the costs that were claimed. Now, there may have been a way for him to reconcile it. But all of the evidence from the assessment is that he just simply didn’t take this into account at all, because otherwise he would have had to have dealt with it.”
“Eloise Kearney (a solicitor at Thomson Geer) was asked to draft a chronology of events for the purposes of briefing King Planning (CMC’s delay expert). To undertake this task, she reviewed and included references to relevant documents in a draft chronology, which referenced source documents as well as draft witness statements of both Matthew Grey and Ben Vance. Source documents, including Site Instructions, Revised Drawings, photographs, emails, RFI’s (requests for information) and responses. The assessor is invited to review email correspondence on the file from 3 March 2015 to assess the documents examined by Eloise - including the documents referred to in the Bebo Arch chronology.”
[Underlining added].
“We also note your view that these invoices should be the subject of a line-by-line comparison with the Cost Statement. Whilst it is a matter for you as to how you want to proceed, we wish to note that:
If it is of assistance, we can provide you with an Excel copy of our firm’s time recording on this file. This is unlikely to align with the Cost Statement, and will not reflect the time billed (our firm would not have billed all time recorded) but you may consider it a useful reference tool in your assessment.”
[Underlining added]
“What he should have done was – and this is a question which we don’t have a definite answer to. He should either have attempted to make an apportion himself. Given that that time was spent preparing the chronology, he should have said, “Well, I’ll allow, let’s say, an hour and a-half for looking at the documents and an hour and a-half for actually drafting and preparing the chronology.” Or he could have said, and we also say this, “If I’m given a costs item that says three and a-half hours spent examining documents and I’m satisfied that that whole time hasn’t been spent examining documents, then I’ll disallow the item.” One of those things is what he should have done.”
[Underlining added]
Examining and considering
Claim item | Item description | WICET’s submission in the notice of objection | Costs assessor’s reasons |
Costs Statement Item 802 ($882) | Examining and considering rule 444 letter and Defence for the purposes of providing advice to the client (AK engaged 180 minutes) | This item is dated 31 July 2013. WICET understands that AK is Mr Andrew Kelly - a Partner of CMC’s instructing solicitors. CMC separately claims for perusing the rule 444 letter: see Costs Statement Item 799 (73 folios). CMC separately claims for perusing the Defence: see Costs Statement Item 801 (202 folios). The Assessor is invited to check CMC’s solicitor’s invoice for work performed by Mr Kelly on 31 July 2013 (180 minutes / 3 hours). If in fact Mr Kelly’s time entries record examination of the defence and r 444 letter (and nothing more), that claim is duplicative of the claims for perusal of the same documents and an impermissible attempt to recover solicitor/client costs of reviewing documents. | Objection sustained - solicitor and client. |
Costs Statement Item 6423 ($1969) | Examining and considering disclosure lists of key word search results outlining in excess of 5000 documents including checking accuracy, considering privilege documents and ensuring the | This item is dated 10 June 2015. At this time, the parties were performing disclosure. “EK” is presumably a solicitor working at CMC’s solicitors. The Costs Statement item narration suggests that EK was checking a document list (for which drafting and producing is presumably separately claimed), performing document checks (in | Objection denied. |
| document protocol has been adhered to in preparation for supplementary disclosure. | respect of documents already reviewed) and otherwise thinking about the issues. The Assessor is invited to check CMC’s solicitor’s invoices for work performed by EK on 10 June 2015 (for 402 minutes / 6.7 hours). If in fact the lawyer’s time entries match the Costs Statement narration, the claim is duplicative and at best care and conduct for the reasons set out above. |
|
Costs Statement Item 12037 ($676.20) | Examining and considering supplementary disclosure arising out of Trial Bundle including finalising index (CN engaged 138 minutes) | This item is dated 12 May 2016 (ie, close to commencement of trial). WICET understands “CN” is solicitor Christopher Newby. The Costs Statement item narration suggests that Mr Newby was reviewing disclosure, considering it and then drafting an index. The Assessor is invited to check CMC’s solicitor’s invoices / time records for work performed by CN on 12 May 2016 (for 138 minutes / 2.3 hours). If in fact the time entry reflects the Costs Statement narration: (A) any consideration is part of care and conduct, and (B) drafting is not claimable as part of examination, (C) any examination referred to in the time entry would need to be check carefully to make sure a claim for examination is not duplicated. | Objection sustained. At clerk rate. |
Costs Statement Item 19300 ($127.12) | Examining and considering the above email to the client (AK engaged 24 minutes) | This item is dated 23 February 2020 (ie, after the Costs Judgment). WICET understands AK to be Andrew Kelly - a partner at CMC’s solicitors. The Costs Statement narration suggests that Mr Kelly was reviewing an email “above” - ie, the email at Costs Statement Item 1299. CMC claims the letter rate for the email at Costs Statement Item 1299. It cannot separately claim for solicitor time reviewing that email. The letter rate is the entire Scale compensation for the email. The Assessor is invited to check CMC’s solicitors’ invoices for work performed by Mr Kelly on 23 February 2020 (for 24 minutes / 0.4 hours). | Objection denied. |
“At the time, Eloise Kearney was preparing CMC’s supplementary disclosure in the proceedings which was exchanged on 12 June 2015. The Assessor is invited to review CMC’s file and time entries from around this date which evidence the work performed.
As the entry notes this involved consideration of disclosure lists and over 5000 documents for this purpose. A copy of the supplementary list is included it Annexure G.
The Notice presume that CMC separately claims for drafting and producing this list and checking the documents included in the list – however this is incorrect. The list was drafted and produced by key word searches and then the results were reviewed by Eloise by way of this (and other items).”
[Underlining added]
Examining for the purposes of settling
Claim item | Item description | WICET’s submission in the notice of objection | Costs assessor’s reasons |
Costs Statement Item 670 ($2,205) | Examining and considering draft Statement of Claim in order to settle (AK engaged 450 minutes) | This entry is dated 2 July 2013 (ie, the day before the statement of claim was filed). WICET understands AK to be Andrew Kelly. CMC separately claims for drafting the Statement of Claim at Item 668 (105 folios). An available inference is that Costs Statement Item 670 is an improper attempt for indemnity reimbursement of Mr Kelly drafting, amending and/or settling a document prepared by another lawyer. As to the drafting performed by other lawyers, see Costs Statement Items 666 and 667 (which are also impermissible solicitor/client claims). The Assessor is invited to check CMC’s solicitor’s time records / invoices on 2 July 2013 for tie incurred by Mr Kelly. If in fact Mr Kelly recorded 450 minutes (7.5 hours) for reviewing and settling the draft statement of claim, that claim should be rejected for the reasons set out above. | Objection denied - cost appears reasonable. |
Costs Statement Item 8293 ($882) | Examining and considering Third Further Amended Statement of Claim in order to settle (GB engaged 108 minutes) | This item is dated 16 December 2015. WICET understands “GB” to be Mr Geoff Brennan, then a Special Council at CMC’s solicitors. CMC separately claims for drafting and producing the Third Further Amended Statement of Claim at Costs Statement Items 8290 and 8291. An available inference is that Costs Statement Item 8293 is an improper attempt for reimbursement of solicitor drafting and amendment of a document prepared by another lawyer which is not permitted at Scale on the standard basis. As to the work performed by the other lawyer, see Item 8289 (which is also an impermissible solicitor / client claim). The Assessor is invited to check CMC’s solicitors’ invoices on 16 December 2015 for time recorded for Mr Brennan (for 108 minutes / 1.8 hours) | Objection sustained. As to 25% UCPR721 (a) Note: the reduction in this instance arose because of a different objection from WICET (in relation to the costs of pleadings), not General Objection 1B. |
Costs Statement Item 15447 ($1,117.20) | Examining and considering instructions to Junior Counsel regarding payments in order to settle | This entry is dated 27 July 2016 (ie during trial) for work by AK, Andrew Kelly. CMC separately claims for drafting the instructions to Junior Counsel at Costs Statement Item 15445 (41 folios). CMC also claims for producing the document at Costs Statement Item 15446. An available inference is that Costs Statement Item 15447 is an improper attempt for indemnity reimbursement of secondary solicitor review - in circumstances where separate drafting and production rates have been claimed. As to the drafting performed by the other lawyer, see Item 15444 (which is also a solicitor/client claim not permitted on the standard basis at Scale). The Assessor is invited to check CMC’s solicitors’ invoices / time records for entries on 27 July 2016 in relation to time recorded by Mr Kelly. In in fact Mr Kelly recorded 228 minutes (3.8 hours) for settling a brief, that claim should be rejected for the reasons set out above. | Objection denied - insufficient particulars. |
Costs Statement Item 19210 ($572.40) | Examining and considering costs spreadsheet in order to settle (AK engaged 108 minutes) | This entry is dated 13 February 2020 for work done by Andrew Kelly. This is after the Costs Judgment. The Costs Statement narration indicates that Mr Kelly settled a document prepared by another lawyer. As to the claim made by the other lawyer, see 19209 (which is also a solicitor/client claim not permitted at Scale on the standard basis). The Assessor should check CMC’s solicitor’s invoices for entries on 27 July 2016 in relation to time recorded by Mr Kelly. If in fact Mr Kelly recorded 108 minutes (1.8 hours) of time for settling a costs spreadsheet, that claim should be rejected for the reasons set out above. | Objection sustained. |
Examining and collating
Ground three: liability for the costs of the assessment and the assessor’s fees
“The Defendant’s Submissions…correctly stated that it is the Assessor’s discretion to decide costs of the assessment. In coming to my decision, I did take into account that the Plaintiff’s Costs Statement appeared to traverse all of the work undertaken by the Plaintiffs Solicitors, and indeed, I cannot recall a specific objection from the Defendant asserting that any item (or items) of work or disbursements claimed was never performed.
…”
[Underlining added]
Analysis
“Because of the misguided manner in which the Costs Statement has been prepared, WICET has significant reservations as to the veracity of the Costs Statement and the level of the costs claimed therein. Even if certain claim items are permissible under the Scale (which is denied), the rolled-up and general description of the items makes them difficult to interrogate. Because the Costs Statement seeks every advance, WICET has doubts as to whether the costs described were incurred at all.
By its Costs Statement, CMC claims approximately $10.7 million. That is a staggering amount for a claim for costs on the standard basis - and even more extraordinary in circumstances where the net result to COMC based on the claim and counterclaim was an award of approximately $600,000. Based on its own costs incurred in the proceeding, WICET expects that CMC’s claim for $10.7 million is, in fact, a majority of CMC’s actual costs. Again, CMC is not entitled to its costs on an indemnity basis.
The result is that neither WICET nor any Assessor can have any confidence in the Costs Statement prepared by CMC.
…
For any items that the Assessor is minded to consider:
Verification of CMC’s claim is essential - in particular for time-based entries... “
[Underlining added]
“The assessor then considered whether some of the burden of the costs of the assessment should be borne by the present respondents. He correctly took into account the outcome of the costs assessment. That was a relevant consideration because where claims in a costs statement are substantially reduced by the assessor, it can be said that the costs of the assessment have been increased through the fault of the party which presented the costs statement. But that was not the only consideration: it was also relevant for the assessor to consider the nature and extent of the objections. In this case, the assessor noted that the applicant appeared to have an objection to every item. And he noted that her objections were not framed by reference to the relevant principles and rules and that at least some of them were entirely without merit. In my view, there was no error in the exercise of his discretion in deciding to apportion the costs of the assessment as he did.”
[Underlining added].
“…despite the reduction the Plaintiff sustained…I ultimately decided that the Plaintiff should receive the benefit of the costs of the assessment, as I also considered that WICET’s Objections would have had to traverse a similar if not identical range in any alternative scenario.”
Part Four: summary of outcomes of the applications.
[1]Civil Mining and Construction Pty Ltd v Wiggins Island Coal Export Terminal Pty Ltd [2017] QSC 85 at [1]-[16] per Flanagan J.
[2] Civil Mining and Construction Pty Ltd v Wiggins Island Coal Export Terminal Pty Ltd [2018] QSC 60.
[3] Separate orders were made with the difference between the amounts of the two judgments, once interest and GST were added, was $1,796,368.55 (in CMC’s favour).
[4] Order dated 31 January 2022; Civil Mining and Construction Pty Ltd v Wiggins Island Coal Export Terminal Pty Ltd [2020] QSC 1 (“the Costs Judgment”). WICET’s costs of its counterclaim are yet to be assessed (although a costs statement and notice of objection have been prepared). WICET appealed the costs order. Wiggins Island Coal Export Terminal Pty Ltd v Civil Mining & Construction Pty Ltd [2021] QCA 8; (2021) 7 QR 1 (“Costs Appeal Judgment”).
[5] Letter dated 22 December 2022 from Mr Roberts to the parties; Exhibit SGS-115 to Speechly Affidavit; letter is also marked for identification “K”.
[6] Earlier certificates of 9 November 2022 and 9 December 2022 (amending the 9 November certificate) were later agreed by the parties to be void on the basis that they were premature and were replaced by the certificate of 10 March 2023. But before this (on 1 December 2022), WICET requested the costs assessor provide reasons for assessment relevantly about CMC’s various claims for “examining”. That issue is discussed under that heading later in these reasons. The final sum of $6,605,189.25 in the costs certificate of 10 March 2023 is comprised of $1,655,946 for disbursements (including CMC’s share of the costs assessors assessment of the bill of $327,764.80, which was paid in equal proportions by the parties with CMC’s portion then included as part of the disbursement payable by WICET); and $4,717,621 for professional fees; [total of $6,541.025.52] plus the sum of $64,163.73 in respect of the plaintiff’s supplementary costs statement of 16 January 2023 ($37,167.13 for professional fees and $26,996.60 for disbursements).
[7] For example, the costs assessor schedules were helpfully enlarged, colour-coded and bound into six large A3 folders totalling 800 pages for the purpose of this review. Marked for identification “S”.
[8] The works under the Contract involved the preparation of a rail receival facility, an overland conveyer to deliver the coal to a stockyard area, materials handling and sampling systems, a single berth with ship loader, associated channels, wharves, serves, and administrative facilities.
[9] As that expression was used by Palmer J in Club Marconi of Bossley Park v AVR Services NSW Pty Ltd [2002] NSWSC 584 at [16].
[10] Costs Judgment at [67], [73] and [81].
[11] Costs Judgment at [66].
[12] Costs Judgment at [67].
[13] Australian Coal and Shale Employees Federation v The Commonwealth (1953) 94 CLR 621 at 627-628 per Kitto J.
[14] See Nashvying Pty Ltd v Giacomi [2009] QSC 31 at [4].
[15] See the discussion by Flanagan J in Wiesac Pty Ltd v Insurance Australia Ltd (No 3) (2021) 7 QR 642 at [12]-[14].
[16] Ibid at [48].
[17] Australian Coal and Shale Employees Federation v The Commonwealth (1953) 94 CLR 621 at 627-628.
[18] King v Allianz Australia Insurance Limited [2015] QCA 101 at [18] (Mullins J, (as her Honour then was) with whom Philippides JA and Burns J agreed).
[19] Australian Coal and Shale Employees Federation v The Commonwealth (1953) 94 CLR 621 at 627-628.
[20] Picamore Pty Ltd v Challen [2015] QDC 67 at [7]-[8] per McGill KC DCJ.
[21] Ibid at [7]-[8] per McGill KC DCJ.
[22] Costs Judgment at [82].
[23] Hennessey Glass & Aluminium v Watpac Australia [2007] QDC 57 at [23] per McGill KC DCJ.
[24] Smith v Buller (1875) LR 19 Eq 473.
[25] Smith v Buller (1875) LR 19 Eq 473 at 475 referred to at [23] in Hennessey Glass.
[26] W & A Gilbey Ltd v Continental Liqueurs Pty Ltd [1964] NSWLR 527 at 534; Hennessy Glass at [24] with reference to Francis v Francis and Dickerson [1956] P 87 at 95.
[27] Wiesac at [6].
[28] See also Hennessey Glass at [26]; Francis v Francis and Dickerson [1956] P 87 at 95.
[29] Hennessey Glass at [24].
[30] Hennessey Glass at [27] with reference to Stanley v Phillips (1966) 115 CLR 470 at 486 per Taylor and Owen JJ.
[31] See Pathways Investments Pty Ltd v National Australia Bank Limited [2012] VSC 97 at [3].
[32] Lee v Abedian [2017] QSC 022 at [73].
[33] Hennessey Glass at [26] with reference to the observations of Barwick CJ at p 478 in Stanley.
[34] W & A Gilbey Ltd at 534-535 per Asprey J with reference to the observations of Sachs J in Francis v Francis and Dickerson (1956) P 87 at 96.
[35] Wiesac at [6].
[36] W & A Gilbey at 534-5; cited with approval in King v Allianz Australia Insurance (2015) 71 MVR 182 at [19]; W & A Gilbey (page 534) cited with approval by Martin J (as his Honour then was) in Pinehurst Nominees v Coeur De Lion Investments [2015] QSC 122 at [61].
[37] Innes v The Electoral Commission of Queensland & Ors [2022] QSC 122 at [60]-[62]. This decision was upheld on appeal; see Innes v Electoral Commission of Queensland & Anor [2023] QCA 88 per Bond JA, Gotterson AJA and Wilson J.
[38] See letter of 19 August 2022 from CMC’s solicitors to the costs assessor. Exhibit SGS-40 to the affidavit of Speechly. This letter was also marked in a bundle for identification “Q”.
[39] Russells (a firm) v McCosker [2018] QDC 080 at [36] to [38] per Farr SC DCJ.
[40] See bundle of correspondence marked for identification “Q”.
[41] T3-84 ll 1-21.
[42] Pinehurst Nominees Pty Ltd v Coeur de Lion Investments Pty Ltd [2015] QSC 122 at [31].
[43] Pinehurst Nominees from [32] to [35], with reference to Attorney-General of New South Wales v Kennedy Miller Television Pty Ltd (1998) 43 NSWLR 729.
[44] Costs Appeal Judgment at [81] with reference to Drew v Makita (Australia) Pty Ltd [2009] 2 Qd R 219 at 237.
[45] King v Allianz Australia Insurance Limited [2015] QCA 101 at [33].
[46] CMC’s amended application at [1(a)]. The items listed in Table 1 of the Schedule to the application are defined as the “pre-proceeding costs”.
[47] CMC’s complaint that WICET “snuck” in the argument overlooks that the issue was raised in WICET’s written submissions in response to CMC’s application for review.
[48] It was not contended before me that Mr King’s costs were not recovered or not recoverable under the costs order made in CMC’s favour.
[49] See W & A Gilbey Ltd per Asprey J.
[50] I accept there might be circumstances when a plaintiff might still reasonably recover the fees of the first expert in such a scenario; for example, if the expert had died or otherwise become unavailable for reasons that were beyond the control of the plaintiff. But of course, that is not the case here.
[51] Bartlett v Higgins (1901) 2 KB 230 at 237; Levetus v Newton (1883) 28 Sol. J. 166 at 166, cited with approval by the High Court in Clark, Tait & Co v Federal Commissioner of Taxation (Cth) (1931) 47 CLR 142 at 146; Clark v Malpas (1863) 31 Beav 1253 at 1255, also cited in Clark, Tait & Co v Federal Commissioner of Taxation (Cth) (1931) 47 CLR 142 at 146.
[52] CMC does not suggest that the other report prepared, i.e. Mr Mason’s report, was also adopted by CMC’s replacement expert. CMC’s brief submissions as to the costs assessed on this topic [3.14]-[3.15] make no mention of Mr Mason’s report.
[53] WICET’s notice of objection at [7.1]–[7.4].
[54] CMC’s submissions in response at [8.1]–[8.6]. Costs Judgment at [72].
[55] Indeed, both parties engaged experienced senior and junior counsel throughout the proceeding including the trial, with WICET retaining two junior counsel for the trial and CMC one junior counsel.
[56] CMC’s amended application [1(d)].
[57] Relying on the observations of Flanaghan J in Wiesac at [47].
[58] That is, he appears to have adopted a rule of thumb of one day of preparation for each day of trial.
[59] With reference to Higgins v Nicol (No 2) (1972) 21 FLR 34 at 42. See WICET’s reply to response to notice of objection at 16.2(d) referring to Swan v Bank of New Zealand (1890) 24 SALR 20 at 21.
[60] WICET’s notice of objection at [15.8]–[15.10].
[61] Dal Pont, Law on Costs 3rd ed, LexisNexis, Australia, 2013 at 16.2-16.21; See also the observations of McGill DCJ QC in Hennessey Glass at [78] and [81]; Atkinson J in Menegazzo v PricewaterhouseCoopers [2017] QSC 172 [8] and [10]; and Jones J in Nashvying Pty Ltd v Giacomi [2009] QSC 31 at [12].
[62] CMC’s submissions at [103].
[63] WICET’s notice of objection at [15.1].
[64] WICET’s notice of objection at [15.6].
[65] WICET’s written submissions in response to CMC’s application for review [149].
[66] CMC’s submissions at [98].
[67]Ibid.
[68] Laming v Jennings [2018] VSCA 335 at [123] (with reference to the construction of a court order – the construction of which is no different to the construction of an agreement).
[69] Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337 at 352; Commission v Nation (1995) 57 FCR 25 at 33-34 (Beaumont J, Jenkinson J and Black CJ agreeing); Electricity Generation Corporation t/as Verve Energy v Woodside Energy Ltd (2014) 251 CLR 640 at 656–657.
[70] Zhu v Treasurer of New South Wales (2004) 218 CLR 530 at 559; Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at 118.
[71] Wiesac at [48]-[49], per Flanagan J.
[72] Wide Bay at [104]-[106].
[73] As described senior counsel for CMC before me at T 2-67 ll 32-36.
[74] Wide Bay at [105].
[75] Hennessey Glass at [78]. See also Dal Pont, Law on Costs 3rd ed, LexisNexis, Australia, 2013 at 17.68.
[76] These items are listed in Table 4 of the Schedule to the amended application.
[77] Amended application at [1(d)(i)-(iii)].
[78] (1946) 73 CLR 129 at 133-134.
[79] Medway Oil and Storage Co Ltd v Continental Contractors Ltd [1929] AC 88; Gladstone Area Water Board v AJ Lucas Operations [2015] QSC 52 at [27]; Australia & New Zealand Banking Group Ltd v Alirezai (No 2) [2002] QSC 205 at [14]; Quick & Garnsworthy, Quick on Costs 2009, LBC Information Services at para 4.4960; Wiggins Island Coal Export Terminal Pty Ltd v Civil Mining & Construction Pty Ltd (2021) 7 QR 1 at [6].
[80] T 1-41 ll 33-36.
[81] CMC’s submissions dealt with why items in respect of the Delay Claim should not be apportioned as they were not severable. WICET had made submissions to the costs assessor that an apportionment was appropriate, but the costs assessor did not allow that submission and WICET does not challenge that aspect of the costs assessor’s decision. It accepts that the items of cost claimed by CMC, with respect to its Delay Claim, should not be reduced.
[82] T2-39.
[83] See document marked for identification ‘A’.
[84] T 2-39 ll 45-46.
[85] WICET’s written submissions in response to CMC’s application for review at [182].
[86] As senior counsel for CMC pointed out at T1-48 ll 19-26.
[87] CMC claimed $1,048,335.41 under this item.
[88] CMC claimed $1,589,975.31 under this item.
[89] CMC claimed $41,810.27 under this item.
[90] CMC’s submissions at [135].
[91] Document marked for identification “H”. T1-58 ll 45-46.
[92] Overall, the costs assessor disallowed around $1,811,242.00 of the care and conduct costs.
[93] This was the correct approach; see the observation of Philippides JA (with whom Fraser JA and Ryan J agreed) in Thompson v Cavalier King Charles Spaniel Rescue (Qld) Inc [2020] QCA 2 at [26].
[94] CMC’s submissions at [136].
[95] CMC’s submissions at [141].
[96] Toomey v Scolaro’s Concrete Constructions Pty Ltd (in liq) (2001) VSC 477 at [6]-[8],[11].
[97]WICET’s notice of objection at [4.20] to [4.27].
[98] Dal Pont, Law of Costs, 4th ed, LexisNexis, Australia, 2018 at 15.68 footnote 382.
[99] Williams v AusNet Electricity Services Pty Ltd (No 3) [2017] VSC 528 at [27], [34]-[37].
[100] Schmid v Skimming [2020] VSC 493 at [88].
[101] Ibid at [101] and [115].
[102] And for the more general reasons outlined under the heading “Adequacy of Reasons” earlier in these reasons.
[103] CMC’s submission at [137].
[104] These authorities were helpfully gathered in WICET’s written submissions in response to CMC’s application for review [214] to [218].
[105] Jenkins v GJ Coles & Co Ltd [1993] 1 VR 155 at 156.
[106] Jenkins at 157.
[107] Jenkins at 157 referring to Rivington v Garden [1901] 1 Ch. 561 at 569; and Assets Development Co Ltd v Close Brothers and Co. [1900] 2 Ch 717.
[108] The City of Warrnambool v Tabone, unreported, 25 August 1992 BC9203233 at 4 to 5.
[109] The City of Warrnambool v Tabone, unreported, 25 August 1992 BC9203233 at 3.
[110] Alucraft Pty Ltd (in liq) v Grocon Limited, unreported 25 May 1994 BC9401087 at 3.
[111] Trial Judgment at [74].
[112] In the language of Smith J in Alucraft.
[113] Remely v O'Shea & Ors (No 2) [2008] QSC 218 at [19]; In Geatches v Anglo Coal (Moranbah North Management) Pty Ltd (No 2) [2014] QSC 136 at [37] Henry J observed that this reasoning was uncontroversial.
[114] Between 2013 and 2018 when most of the costs of the proceeding were incurred.
[115] WICET’s notice of objection at [1.4].
[116] During oral submissions at the review hearing, senior counsel for WICET confirmed that that WICET was not challenging the costs assessor’s decision to disallow approximately $150,000 but rather, the challenge was to all of the amount allowed. T3-14 ll 13-16.
[117] UCPR r 702(2).
[118] UCPR r 705(2).
[119] As set out in paragraphs [28] to [35] of WICET’s written submissions.
[120] The objection was rejected on the grounds that “the work done was (sic) the purposes on the ongoing litigation.
[121] The bulk of the claim was allowed – the disallowed portion was rejected on the basis that some of CMC’s costs related to the counterclaim costs and not costs of the claim.
[122] The objection was rejected on the grounds “Objection denied insufficient particulars”.
[123] WICET’s notice of objection at [1.10].
[124] WICET’s submissions at [117].
[125] WICET’s notice of objection at [1.13(c)].
[126] Costs assessor’s reasons dated 11 April 2023 at [11].
[127] Costs assessor's reasons dated 11 April 2023 at [12] and [13].
[128] WICET’s notice of objection at [3.10] to [3.45].
[129] As well as other claims for examining (for example, “examining and considering”) as discussed under that heading later in these reasons.
[130] Given the quantum of the costs statement and the number of items.
[131] Costs assessor’s reasons dated 11 April 2023 at [10(d)].
[132] CMC’s submissions in response to WICET’s application for review at [43] and [44].
[133] The Excel spreadsheet contained in Exhibit B sets out: the item objected to; the claim description; the objection description; and the reasons of the costs assessor (as delivered on 11 April 2023).
[134] WICET’s notice of objection at [3.10] to [3.45].
[135] All of which are part of its General Objection 1B in WICET’s notice of objection.
[136] R Quick, Quick on Costs, Thomson Reuters, [290.130].
[137] Barristers’ Board v Palm Management Pty Ltd [1984] WAR 101 at 109, citing Green v Hoyle [1976] 2 All ER 633 at 638.
[138] R Quick, Quick on Costs, Thomson Reuters, [290.130].
[139] R Quick, Quick on Costs, Thomson Reuters, [290.140].
[140]Re Feez Ruthning’s Bill of Costs [1989] 1 Qd R 55 at 73; McCoombes v Curragh Qld Mining Limited [2001] QDC 142 at [38].
[141] R Quick, Quick on Costs, Thomson Reuters, [290.120].
[142] Ernest v Partridge (1863) 2 New Rep 232.
[143] CMC’s submission in response to WICET’s application for review at [57].
[144] T 3-71 ll 33-46.
[145] Mr Schwarz also exhibited the relevant document to his affidavit to demonstrate (on its face) that the solicitor must have reviewed other documents in drafting or producing etc that document.
[146] T 3-66. Mr Schwarz’s affidavit was relied upon as a submission and not evidence [T1-3 ll 44-46]. I have however mentioned some of the documents referred to and exhibited to Mr Schwarz’s affidavit in this judgment as they were before the costs assessor. For example, the closing submissions and drafting a chronology for the Bebo Arch claim.
[147] The examining for the purpose of drafting items are listed at pages 26 to 58 of Exhibit B.
[148] WICET’s notice of objection at [3.15] to [3.18] as set out in WICET’s submissions at [80].
[149] As can be seen from the notice of objection, WICET invited the costs assessor to check CMC’s solicitors invoices/time records.
[150] T3-76 ll 1-12.
[151] CMC’s response to objection at p. 10. Similar responses were given to other items; See the response column at p. 10 to 17 of CMC’s response to objection.
[152] Items 5556 and 5557.
[153] The chronology is at SCS-4 of the 7-volume affidavit of Shannon Carl Schwarz, sworn 2 August 2023, Volume 6 of the plaintiff’s bundle of material behind Tab 14.
[154] As described by senior counsel for CMC, T 4-36 ll 15-17.
[155] Letter dated 24 August 2022 at [2.2] - part of the bundle of documents marked for identification, “N”.
[156] T 3-82 ll 4-11; Later in the proceeding, it was submitted that the assessor ought to have asked, “Did Eloise Kearney spend three hours and 30 minutes just examining documents?” at T 3-82 ll 38-40.
[157] Some of the examples given by WICET were resolved in its favour: for example, Item 16469 and 18101; and from the “high level” examples given Item 16463 and a partial reduction for Item 16603.
[158] Annexure A to WICET’s notice of objection includes a list of items claiming costs for examining and considering. Exhibit B is the Excel spreadsheet which includes the item objected to; the claim description; the objection description and the costs assessor reasons of 12 April 2023 – the claims for costs for examining and considering are set out at pages 59 to 84.
[159] CMC’s response to notice of objection at p. 13.
[160] WICET’s submissions in respect of this objection are at [3.25] to [3.28] of the notice of objection. The costs items the subject of this category are at pages 85 to 98 of Exhibit B.
[161] WICET’s submissions at [98].
[162] CMC’s response to WICET’s notice of objection at p. 15.
[163] The costs the subject of this category of objection are set out at pages 99 to 116 of Exhibit B.
[164] R Quick, Quick on Costs, Thomson Reuters [290.120].
[165] WICET’s notice of objection at [3.36].
[166] These were high-value examples given to the costs assessor by WICET in its notice of objection: see Items 1950, 5690 and 8432; as set out in WICET’s submissions at [107].
[167] Costs assessor’s reasons dated 11 April 2023 at [10(d)].
[168] Hunter v Hunter [2015] QSC 181 at [34].
[169] Hunter v Hunter [2015] QSC 181 at [34].
[170] T3-11 l 36.
[171] WICET’s notice of objection at [1.6] to [1.12].
[172] Items 19403 and 19404 claimed for producing and copying the costs statement – those claims were reduced by 25 per cent as well.
[173] [2015] QSC 181 at [35].
[174] Costs assessor’s reasons dated 12 April 2023 at [10(d)].
[175] Pursuant to the document marked for identification “H”; T1-58 l 46.
[176] See paragraph [107] to [109] of these reasons. This will require a recalculation of the amount the costs assessor allowed at the lower rate using the higher rate- with the need for the costs certificate to be varied accordingly.
[177] See paragraphs [124] to [128] of these reasons. Again, This will require a recalculation of the amount the costs assessor allowed at the lower rate using the higher rate that Mr Doyle KC actually charged- with the need for the costs certificate to be varied accordingly.
