Applicant v Respondent

4 Filed with the Summons were some of the respondent's bills of costs and trust statements dated between 2005 and 2016. However, the Summons confines the subject matter of the proposed review to the costs incurred in the two appeals referred to above and initiated in 2010 and 2015 respectively ('appeal costs').

5 The Summons was listed at a callover on 11 September 2018 and directions were given by the Judicial Registrar for the respondent to file any 'Costs Agreement and costs disclosures between the parties' by 25 September 2018. The applicant was then required to file any affidavit by 16 October 2018. The respondent filed documents that answered that description and the applicant filed an affidavit sworn 16 October 2018. A preliminary hearing was set for 15 November 2018 in relation to an argument about whether there was jurisdiction to review the costs associated with the two appeals.

6 Two days prior to the hearing scheduled for 15 November 2018 the respondent filed and served an affidavit of James Murray Pergl affirmed 12 November 2018. The affidavit was stated to be made in response to the affidavit of the applicant[4] and, in part, it referred to over 130 letters and emails between the parties which were not exhibited, but described as 'correspondence by both letters and emails...as to the costs incurred, costs to be incurred and the course of the proceedings...'.[5] From that description these documents appeared to fall within the ambit of the category of documents referred to in the order of the Judicial Registrar made on 11 September 2018. They had not been produced previously. Further, the affidavit was clearly being relied upon in relation to the preliminary question.

7 The applicant successfully applied for an adjournment. Orders were made granting leave for the respondent to file and serve that affidavit of Mr Pergl and for the respondent to produce to the applicant copies of the documents referred to in paragraphs 10 and 11 of the affidavit. The applicant was given leave to file and serve any further affidavit by 21 December 2018. The respondent was given the opportunity to respond in that event by 25 January 2019. Brief written submissions were also ordered to be filed and exchanged by 1 February 2019.

8 No further affidavit was filed by the applicant by 21 December 2018 (or at all) so no answering affidavit by the respondent was required.

9 The operative legislation as at May 2005 when the applicant engaged the respondent was the Legal Practice Act 1996 ('the 1996 Act'). The applicant seeks to review the appeal costs pursuant to s 3.4.38 of the Legal Profession Act 2004 ('the 2004 Act'). Transitional Provision clause 3.1(1) of the 2004 Act states that the 2004 Act applies where 'the client first instructed the law practice in the matter' after 12 December 2005.[6] The applicant seeks to have the first and second appeals considered as two separate 'matters' where instructions were first given after that date. On that basis it is contended that the first appeal is governed by the 2004 Act and the second appeal is governed by the Uniform Legal Profession Law 2015 ('Uniform Law'). The respondent's position is that there was one retainer and one matter where instructions were first given prior to 12 December 2005.

10 Under the 1996 Act there can only be an assessment of costs that are the subject of a costs agreement 'to the extent that it provides for legal costs to be paid according to a practitioner remuneration order or scale of costs of a court or tribunal'.[7] In other words, if the Costs Agreement provides for all work by the practitioners to be costed on hourly rates it cannot be assessed by the Costs Court.

11 At the rescheduled hearing on 8 February 2019 the applicant objected to numerous parts of the affidavit of Mr Pergl where he was said to have been expressing a legal conclusion which was ultimately a matter for the Court. These involved all phrases which conveyed the assertion that there was a single retainer and single matter.[8] This submission had merit.

12 There were five paragraphs[9] of the affidavit to which there was no objection, and no contradictory evidence. They outline the circumstances when the applicant first contacted and engaged the respondent. The impetus was the receipt of five letters from solicitors Holding Redlich.

13 The first letter[10] was addressed to the applicant dated 28 April 2005 asserting that a total of $3,093,519.57 was owed by the applicant (and four companies connected wih him[11]) to Australian Super Developments Pty Ltd, the substance of which subsequently became the subject matter of the Supreme Court proceedings referred to above. The claim for $3,093,519.57 is comprised of $398,290 plus interest and $426,600 plus interest from the applicant, $852,644.66 plus interest from Laguna Australia Pty Ltd, Stage Design Pty Ltd and Goldworthy Pty Ltd, and $339,585 and $58,339.45 plus interest from the applicant and Laguna Australia Pty Ltd.

14 The second to fifth letters[12] were dated 29 April 2004 (dated 2004 in error as they should have been dated 2005). The second letter contained a demand on behalf of Matelda Oaks Pty Ltd for $13,072.65 from LQ Management Pty Ltd. The third letter contained a demand on behalf of Australian Super Developments Pty Ltd for $13,643.75 from Marriner Theatres Pty Ltd. The fourth letter contained a demand on behalf of Cumberland Management Ltd for $50,000 from Kaban Pty Ltd. The fifth letter contained a demand on behalf of Australian Super Developments Pty Ltd for $52,096.71 from Stage Design Pty Ltd.

15 It is apparent from the affidavit of Mr Pergl,[13] and an exhibited file note dated 5 May 2005,[14] that instructions were obtained from the applicant to deal with all the matters raised in the five letters from Holding Redlich. Two separate letters were sent to Holding Redlich by the respondent in response on 5 May 2005.[15]

16 The claims made in the third, fourth and fifth letters were resolved.[16] The demand in the second letter formed the basis of litigation where the respondent issued a cross claim on behalf of Goldworthy Pty Ltd in Supreme Court proceeding S CI 2084 of 2005.[17]

17 The claim in the first letter formed the basis of the proceedings referred to in paragraph 2 above, that is Supreme Court proceeding S CI 2071 of 2005 issued on 10 June 2005.

18 It is apparent from a letter from the respondent to the applicant dated 5 May 2005 that the applicant first consulted the respondent on 3 May 2005[18] in relation to matters raised in the first letter dated 28 April 2005 received from solicitors Holding Redlich. This letter of 5 May 2005 describes the Holding Redlich letter as raising two issues, actual and potential. The actual issue arises from the substance of the Holding Redlich letter which relates exclusively to the commercial matters and the demands for the various sums of money referred to in paragraph 13 above. The second issue that arose was the fact that the Holding Redlich letter was copied to others and the letter contains allegations of misapplication of trust moneys, that is, potentially defamatory comment. The respondent's letter of 5 May 2005 to the applicant categorised the content as the 'substantial' issue and the alleged defamation arising from the letter itself.[19] The respondent's letter of 5 May 2005 to the applicant was headed 'Claim by Australian Super Developments Pty Ltd.'

19 The letter of 5 May 2005 is relied upon by the respondent as constituting a Costs Agreement.[20] The letter, while referring to the initial conferences with the applicant and 'Mr John Whalley (who is the company secretary of companies of which you are a director)' was addressed to the applicant personally. The companies that the applicant was a director of were included as additional appellants ultimately represented by the respondent in both appeals. The letter states 'We confirm that you have engaged us to act for you in respect of the matters raised in a letter to you from Holding Redlich dated 28 April 2005' (emphasis added). The letter then states 'We would like to provide you with information about our professional charges and any other expenses associated with the conduct of the matter' (emphasis added). The letter contains hourly rates, the names of individuals who will work on the matter, and 'administrative costs' which include charges for copying, printing, facsimiles, phone calls, postage, couriers etc. It states that ' we will continue to work on your matter' (emphasis added).

20 The 1996 Act required the provision of 'an estimate of the total legal costs, if reasonably practicable.'[21] The letter stated 'It is difficult to provide you at this stage with an accurate estimate of the total of these costs'. An estimate is then provided for both the substantial matter and the alleged defamation matter for the work involved in responding to the Holding Redlich letter of 28 April 2005. Section 86(3)(d) states that if there is likely to be litigation then ranges of costs are to be provided in scenarios where the client is either successful or unsuccessful. The letter provides a percentage range of both liability for, and entitlement to, costs on both scenarios. The letter is couched in terms to cover the scenarios where proceedings are either initiated against Australian Super Developments Pty Ltd or by that company. The first letter from Holding Redlich demanded payment in full by 19 May 2005 and foreshadowing legal proceedings in default. Proceedings were therefore potentially imminent and they were in fact issued a short time later on 10 June 2005.

21 In a subsequent letter from the respondent to the applicant dated 17 May 2006 reference is made to photocopy charges and document production charges as being 'in accordance with our retainer agreement set out in our letter to you dated 5 May 2005.' It is clear from other documentation that the respondent regarded that letter of 5 May 2005 as constituting a Costs Agreement. There is no evidence before me to suggest that (at the relevant time) the applicant did not accept this as an accurate characterisation of the initial letter dated 5 May 2005.

22 In his affidavit the applicant concedes that the letter of 5 May 2005 has this character. The applicant's affidavit confirms that he approached the respondent to 'act for me in about late April or early May 2005, in relation to a letter of demand received from Australian Superannuation (sic) Developments Pty Ltd'[22] (emphasis added). The applicant concedes that 'the letter is addressed to me personally' (emphasis added) and that the letter of 5 May 2005 is relied upon by the respondent as 'their only Costs Agreement.' Further on he deposes that 'the letter of 5 May 2005 was the only Costs Agreement ever sent'.[23] The applicant therefore accepts this is the only Costs Agreement. The letter will now be referred to as the 'Costs Agreement'.

23 The applicant deposes that neither he, nor the companies, were provided with a Costs Agreement once litigation was initiated by Australian Super Developments Pty Ltd. That situation is said to have continued in respect to the two appeals. Reference is made to the fact that the respondent may have mistakenly thought that other Costs Agreements were sent arising from the content of two emails dated 8 July 2016 and 8 September 2017.[24] In his affidavit Mr Pergl refers to the reference to an 'administration fee' in the email of 8 July 2016 and deposes this was in fact a reference to the 'premium' referred to in the Costs Agreement which might apply if there is urgency, complexity and value added.

24 The applicant deposes to the fact that some of the bills contained unrelated work. For example, the respondent represented Goldworthy Pty Ltd in litigation with Matelda Oaks Pty Ltd, the latter company not being a party to the claim by Australian Super Developments Pty Ltd. Further, that he may have been invoiced personally for work performed for the companies in the litigation and the appeals.

25 The applicant's affidavit identifies that the respondent is seeking to argue that there was one matter and that the 1996 Act applied. Reliance is placed on the fact that the respondent's correspondence and invoices differentiated between the stages of litigation and that references to an option to seek a review under the Legal Profession Act 2004 or to the Costs Court or the Supreme Court were included in the Costs Agreement and some invoices.[25]

26 The applicant's affidavit exhibits part of an invoice dated 29 August 2008 which relates to the Goldsworthy proceeding involving Matelda Oaks which describes the client as the applicant personally and the matter as 'Claim by Australian Super Developments P/L'.[26] The purpose of exhibiting it is to demonstrate that different matters are mixed in invoices.

27 However, this might also be consistent with a conclusion that the 'client' or party liable for the respondent's fees for all these matters is the applicant personally. It is clear that the respondent acted for the corporate entities, but this is separate from there being an agreement that those entities would be liable for the costs. The only Costs Agreement is with the applicant personally and, consistent with that, it is only the applicant who seeks to review the appeal costs. The question is whether all the work billed for relating to the two appeals is caught by the Costs Agreement and is, at law, 'one matter'.

28 It is clear from the Costs Agreement that the subject matter of the retainer was expressed in broad terms as it referred to the underlying disputes with Australian Super Developments Pty Ltd and not specific legal proceedings. There were in fact no court proceedings on foot at the time. It was unclear at that stage as to who would initiate or defend any subsequent proceedings. This is confirmed by the information contained in the letter about legal costs flowing from both success or lack of success on either of two scenarios, namely where proceedings were initiated by the applicant against Australian Super Developments Pty Ltd or initiated by that entity against the applicant.[27]

29 There were ultimately three proceedings between the applicant and Australian Super Developments Pty Ltd. The first is the substantive proceeding which was the underlying dispute between Australian Super Developments Pty Ltd and others. This comprised a claim and counterclaim aired before the two single judges, one at first instance and the other upon remittal. The second proceeding was the first appeal of the first single judge trial initiated by the applicant and others and the third proceeding was the second appeal from the remitted single judge trial initiated by the applicant and others.

30 The preliminary issue that arises for consideration is whether the Costs Court has jurisdiction to review the costs of the two appeals. There are two potential elements to this. The first arises from the fact that there is only one Costs Agreement in existence. The respondent argues that the scope of that Costs Agreement and retainer is of importance. The second element is whether there is only one matter, namely the dispute with Australian Super Developments Pty Ltd or whether the appeals are separate matters under the 2004 Act and Uniform Law respectively.

31 Put simply, the divide between the parties is that the applicant contends for the matter to be resolved on the basis of what constitutes a matter under the legislation and that there is a distinction between a retainer and a matter.[28] The respondent contends for the legislation to be considered in the context of the contractual arrangements and the scope of the retainer.[29]

32 The Costs Agreement was dated prior to 12 December 2005. This means that the 1996 Act is the operative legislation at that time. The Costs Agreement provides for work to be quantified on hourly rates. Section 101(2) of the 1996 Act provides that the costs that are the subject of a costs agreement can only be reviewed 'to the extent that it provides for legal costs to be paid according to a practitioner remuneration order or scale of costs of a court or tribunal'. If the matter comprises the appeals as well then the Costs Court has no jurisdiction to review the appeal costs being the entire subject matter of this current proceeding.

33 One question is therefore whether the scope of the Costs Agreement covers all three proceedings outlined in paragraph 29 above. In other words, whether the Costs Agreement only encompasses a single 'matter' comprising the underlying dispute and any proceeding arising from it. That is, do all three proceedings comprise one 'matter' when construing the Costs Agreement, the scope of the retainer and the 2004 Act? If the two appeals are not covered by the Costs Agreement and they are separate matters under the 2004 Act and Uniform Law, then there is no Costs Agreement covering this work and the Costs Court would have jurisdiction (subject to applicable time limits) to entertain a review of the recoverable costs assessed on the basis of Supreme Court Scale as per section 3.4.19(b) of the 2004 Act for the first appeal and on a fair and reasonable basis as per section 172 of the Uniform Law for the second appeal.

34 A question arises as to whether one Costs Agreement in broad terms entered into prior to the initiation of court proceedings can be sufficient to cover all proceedings arising from the underlining dispute. In other words can a matter be a single retainer to advance the applicant's interests (and those of the various companies) in whatever litigation is initiated.

35 The scope of a retainer can be express or implied from surrounding circumstances and the conduct of the parties. The applicant was provided with bills over an extensive period of time with hourly rates based on the original Costs Agreement.

36 The Costs Agreement describes the matter as 'Claim by Australian Super Developments Pty Ltd'. All bills of costs have this heading although the additional words 'Court of Appeal proceedings' and 'Claim by Goldworthy on Matelda Oaks Pty Ltd' also appear with those words in some of the correspondence and invoices.

37 The hourly rates have been updated throughout. The initial rates were described as 'current'. There is reference to the possibility of a premium if urgency or complexity is involved. Increases in rates occurred and this is consistent with the terms of, and continuing operation of, the Costs Agreement.

38 Payment of bills of costs is not inconsistent with the subsequent exercise of review rights.[30] However, conduct and surrounding circumstances can be relevant. The applicant is an experienced businessman and litigator and it would be surprising for him to remain silent if he was being billed on the basis of a contract he thought was no longer operative. His conduct is consistent with an acceptance that the Costs Agreement continued to be the basis of charging for the appeal work.

39 Turning now to the word 'matter' as utilised in the Transitional Provisions of the Act. In effect the applicant's case hinges on the word 'matter' being synonymous with 'legal proceeding'.

40 The applicant's written submission concedes that the single word 'matter' is not defined in the 1996 Act or the 2004 Act (apart from section 2.7.34 in the 2004 Act which is confined to the impact of Corporations legislation). The submission is put that the word is utilised multiple times 'in ways that are inconsistent and therefore unhelpful for current purposes'. Reliance is placed upon the definition of 'litigious matter' in s 3.4.2 of the 2004 Act which is defined to mean 'a matter that involves, or is likely to involve, the issue of proceedings in a court or tribunal'. However that definition has restricted application as it is confined as being applicable 'in this Part' that is, only for the purposes of Part 3.4 of the 2004 Act. There are only two references to a 'litigious matter' in Part 3.4. Namely, s 3.4.9(1)(g) which deals with the initial estimate of costs and s 3.4.13 which deals with additional disclosure of costs before settlement of such a matter. The term 'litigious matter' has narrow application to costs disclosure obligations only. It does not assist in what constitutes a 'matter' for the purposes of interpreting the Transitional provisions.

41 The applicant's written submission makes reference to cases relating to 'matter' in relation to the Constitution but these are not regarded by the applicant as relevant.[31] Some are outlined below.

42 In oral submissions the applicant argued that the question of what constitutes a matter is only to be determined in the basis of the 2004 Act and Uniform Law and is not a question of the scope of the retainer or costs agreement.[32] A 'matter' does not equal 'retainer' and the existence of one Costs Agreement does not mean there is only one matter or one retainer. Distinct instructions are required to initiate an appeal based on error of law.

43 The respondent argued in oral submissions that the scope of the retainer is important and a requirement for specific instructions to appeal does not mean it is not within the scope of the retainer. The retainer was not restricted to particular proceedings in a particular court. It was to act for the applicant in relation to the matter, being the underlying dispute over the claims made by Australian Super Developments Pty Ltd, without regard to any particular litigation or court venue.

44 The question of what constitutes a 'matter' cannot be determined in isolation. I do not accept that it is purely a question of construction of the statute. Some consideration has to be given to the surrounding circumstances in existence when instructions were given to act. The question of what constitutes a matter is clear and narrow if a Costs Agreement or retainer is for the provision of legal services in relation to a specific piece of litigation that has already been issued. The question is less clear cut when there is no litigation and a disputed factual matrix is the basis of engaging the lawyer. For example some disputes outlined in a letter (like the Holding Redlich ones) may end up in the Magistrates Court, County Court or Supreme Court. There is no requirement for separate costs agreements for each jurisdiction.

45 It is clear that the respondent had one Costs Agreement in which the various controversies were referred to as 'the matters.' The respondent also ran one file and rendered bills containing work across different matters in the one bill. They clearly regarded all the work as one matter. These factors are not definitive of the issue. The respondent relies on the fact that appeals to the Court of Appeal are designated with their own file numbers, require specific instructions and involve the identification of errors in the first instance judgment. These factors are also not definitive of the issue.

46 There are two important points that can be made about the wording selected by the framers of Transitional clause 3.1(1) of the 2004 Act. The clause states '...Part 3.4 of this Act applies to a matter if the the client first instructs the law practice on or after the commencement day and Part 4 of the 2004 Act[33] continues to apply to a matter if the client first instructed the law practice in the matter if the client first instructed the law practice in the matter before the commencement day'.

47 First, they have defined and already utilised the phrase 'litigious matter' in s 3.4.2 which is within Part 3.4 of the 2004 Act. It is defined to mean 'a matter that involves, or is likely to involve, the issue of proceedings in a court or tribunal'. However, it has been given very restricted application within Part 3.4. It is only relevant to disclosure obligations in relation to initial estimates of costs[34] and the updating of liability for costs at the time of settlement of proceedings.[35] It does not assist in the definition of a 'matter' in the Transitional provisions.

48 Elsewhere in the Transitional provisions both the terms 'proceeding' and 'matter' have been utilised in relation to the Legal Profession Tribunal.[36] The use of the term 'matter' in clause 3.1(1) in a broad way evidences a deliberate decision not to necessarily expand the operation of the 2004 Act to cover the situation where first instructions were given after December 2005 in relation to a particular proceeding.

49 In reality the word 'matter' in the relevant Transitional Provision is broad as it covers non-litigious work, work that relates to potential litigation and work in relation to actual litigation. In the circumstances of this case I take it to mean a reference to the underlying subject, controversy or situation under consideration. The Costs Agreement and breadth of the retainer is consistent with that interpretation. In this case, the underlying dispute and demands for money from the applicant and the various companies conveyed in the Holding Redlich letters of 28 and 29 April 2005 comprises the matter. The subsequent appeals still have nexus with those matters. My conclusion is that 'the matter' is not to be read narrowly to mean particular litigation in a particular court.

50 There would need to be a clear legislative intent demonstrated in the Transitional provisions to affect the review rights of contracting parties retrospectively. The 1996 Act was the relevant Act at the time the Costs Agreement was agreed to and it is specifically referred to in that Costs Agreement. Any review rights contained in the 1996 Act at the time attach to the contract.

51 In the 1996 Act Division 3 contained terms in relation to 'Costs Agreements' and Division 4 contained provisions in relation to 'Bills of Costs'. Section 101(1) of the 1996 Act is within Division 3 and states 'subject to this Division and Division 4, a costs agreement may be enforced in the same way as any other contract.' In this case the absence of review rights for the applicant and the protection from review for the respondent was a right that accrued at that time. There would need to be clear wording in the Transitional provisions to retrospectively alter the respondent's accrued rights in relation to review.

52 The Costs Agreement utilised the word 'matter' and provided the same basis for charging for all work. The retainer was a broad one and covered a number of separate demands for money on different bases from a number of different entities. The retainer was to resist all of these irrespective of whichever court any proceedings might be issued in.

53 The respondent relies upon three authorities. The applicant argued at the hearing that they were of limited assistance and I agree. The respondent relies on a passage from Forestview Nominees Pty Ltd v Perron Investment Pty Ltd where it is stated:[37]

The scope of the solicitor's authority as an agent is to undertake those matters which flow from the retainer subject to limitations requiring special authority for certain expenses of pledging the principals credit: Cordery's Law Relating to Solicitors (Butterworths (8th ed), 1988) p. 76-77. The solicitor is authorised to act as his or her principal's agent in all matters (not falling within an exception) which may reasonably be expected to arise for decision in the course of proceedings: Cordery at 83.

54 Forestview was a case in relation to whether the client was liable for actions of their solicitor taken in contempt of court. The second case is Polkinghorne v Holland[38] a case which was determined on what was or was not part of the ordinary business of a firm of solicitors. Both these cases are footnoted in Dal Pont - Law of Costs[39] for the proposition that 'implied into every retainer is the lawyer's duty to protect the client's interest and to carry out by all proper means his or her instructions in the matters to which the retainer relates. Aside from express terms to the contray, this dictates that, within the confines of the retainer, the lawyer-client relationship carries with it the implied authority to do all such things incidental to the object of the representation'.

55 The third case is Madden v Owners - Strata Plan No. 64970.[40] The parties relied on different parts of the case. The respondent relies on the part that posits that disclosure can relate to more than one matter.[41] The applicant relies on the part that gives an example of litigious court proceedings being in relation to matter.[42] Neither are of direct relevance or any real assistance.

56 The applicant's written submissions rely upon no specific authority. Reliance is placed on how the parties in correspondence and the Court treated the appeals as separate matters.[43]

57 In oral submissions the applicant contended that to treat the appeals as part of the one matter was to make a nonsense of the disclosure regimes in the three Acts as an estimate at the start of the retainer requiring an estimate of total costs would have to involve possible appeals in every litigious matter. The answer to that submission is that an initial estimate is just that - an estimate of the total. Both the 1996 Act and 2004 Act provide (in identical terms[44]) for an estimate of total costs and if that is not reasonably practicable a range of estimates with an explanation of the variables that will affect the calculation. The prospect of an appeal would clearly fall within such a variable. The requirement of the updating of estimates for substantial changes (eg in the event of an appeal) is also contained in both the 1996 and 2004 Acts[45].

58 As a general proposition courts have generally interpreted the term 'matter' more broadly than the term 'proceeding'. There is merit in regarding 'matter' in Transitional clause 3.1(1) of the 2004 Act in the context of the scope of the retainer and terms of the Costs Agreement in this matter as constituting the underlying disputed facts or controversy irrespective of whether proceedings were issued, or if they were, whichever court might be involved.

59 For completeness, the meaning of the term 'matter' has mainly been considered in case law in the context of the Constitution and has generally been defined broadly. These cases are not of direct relevance but are illustrative of the point.

60 In South Australia v Victoria Griffith CJ stated, in the context of s 75 of the Constitution, that '[t]he word "matters" was in 1900 in common use as the widest term to denote controversies which might come before a Court of Justice'.[46]

61 In Re Judiciary and Navigation Acts, the majority of the High Court gave an advisory opinion on the meaning of the term 'matter' in the context of s 76 of the Constitution. The Court held that :

we do not think that the word 'matter' in sec. 76 means a legal proceeding, but rather the subject matter for determination in a legal proceeding. In our opinion there can be no matter within the meaning of the section unless there is some immediate right, duty or liability to be established by the determination of the Court.[47]

62 Again in the context of ss 75 and 76 of the Australian Constitution, Mason J in Phillip Morris Inc v Adam P Brown Male Fashions Pty Ltd advocated for giving the term 'matter' a broad rather than a narrow meaning.[48] He stated that:

In deciding whether to attribute either a broad or a narrow content to 'matter', we should take into account that the adoption of the broad meaning will lead to the speedier determination of entire controversies between parties without undue duplication of proceedings.[49]

63 In Fencott v Muller, the High Court noted that the concept of 'matter' is 'a justiciable controversy, identifiable independently of the proceedings which are brought for its determination and encompassing all claims made within the scope of the controversy'.[50]

64 High Court authorities were also considered in Alessi v Moses (Legal Practice) at VCAT.[51] In that matter Transitional Provision clauses of the new Act, other than clause 3.1(1), were considered. They were clauses 8.3 and 8.4 which related to pending matters before the Legal Profession Tribunal as at 12 December 2005. What is significant is that the framers of the Transitional Provisions utilised both words 'matter' and 'proceeding' in some of the provisions. Significantly, clause 3.1, being the only directly relevant clause for consideration here, only refers to 'matter'. There was a clearly deliberate decision made not to refer to a proceeding commenced before or after the commencement date in that provision. In other words, 'matter' was a broad concept that was intended to constitute something other than, and potentially larger than, a 'proceeding'.

65 Similar to the approach of the authorities cited above, the Tribunal held that 'matter' is a broader term than 'proceeding'.[52] The word 'matter', as used in the Transitional Provisions was stated to be 'of at least sufficient breadth to encompass an appeal arising from the same legal controversy'.[53] Adopting the reasoning in Re Judiciary and Navigation Acts, the Tribunal held that the appeal still involved the same subject matter for determination in a legal proceeding and, as such, the appeal did not represent the initiation of a new matter.[54]

66 In New South Wales Department of Housing v Moskalev[55] Cowdroy J reiterated that '[a] 'matter' must be a justiciable dispute and not merely a legal proceeding'.[56]

67 As stated in paragraph 25 above the applicant relies upon the fact that some of the documentation refers to the ability to seek a review of legal costs under the 2004 Act, and to the Costs Court and the Supreme Court.[57] However, the Costs Court jurisdiction is defined by s 17D(1)(f) and (g) of the Supreme Court Act 1986 and cannot exercise jurisdiction where none exists under the 1996 or 2004 Act. The parties cannot confer jurisdiction if none exists.[58] There is no provision in the 2004 Act to provide for the parties to consent to jurisdiction.[59]

68 The applicant submits that all three iterations of the legislation provide a level of consumer protection and a finding that characterising three separate proceedings as one matter would make a nonsense of these provisions.[60] It could equally be said that the clear intention of the framers of the 1996 and 2004 Acts was to exclude the review of legal costs where a costs agreement was not based on scale in matters where instructions were first given prior to December 2005.

69 The applicant in written submission makes the point that the respondent's bills and Costs Agreement held out that the applicant was entitled to review the costs in the Supreme Court and they are now taking a technical argument to prevent that from occurring. This is said to result in a 'gross denial of justice'. In oral submission it was characterised by the applicant as a denial of 'natural justice'.[61] However, it is possible that there is minimal injustice in that regard. If, as the applicant contends, the two appeals are separate matters then the time to review the costs in the first appeal would expire 12 months after the final bill in that matter. This was not addressed in the preliminary hearing other than a reference in the respondent's written submission that the applicant has not demonstrated that these proceedings have been brought within 12 months of the last bill. It might be of significance that the judgment in the first appeal was published in 2012. The judgment in the second appeal was in 2016. The current proceedings were issued in 2018. An analysis of when the final bill dealing with costs in those appeals would be necessary to determine that issue. It is clear from the discussion with the applicant at the hearing[62] that this has not occurred even though injustice is asserted.

70 The respondent submitted at the hearing that there is no evidence that the applicant acted to his detriment as a result.[63]

71 It appears from the applicant's affidavit that $3m has been spent on legal fees. The demand for the outstanding sum of $250,000 has provided the impetus for this proceeding[64] and there are existing County Court proceedings in relation to this.[65] The initial dispute commenced thirteen years ago. It is time all matters arising from it are finally resolved without further expenditure or utilisation of public resources.

72 The following observation appears in the Court of Appeal judgment[66] dismissing the applicant's second appeal :

Since 2005, the parties to this litigation have spent millions of dollars and have used up valuable court resources, both at trial and on appeal, over a relatively small amount of money. There have been multiple claims and a complex counterclaim, an appeal and cross appeal, a second trial on issues remitted by the Court of Appeal and now there is an application for leave to appeal from orders made at the second trial. The parties' pursuit of litigation instead of endeavouring to reach a reasonable, proportionate, and timely, commercial compromise is greatly to be regretted.

73 The Costs Court has no jurisdiction to review these costs and the proceeding is dismissed.

[1] Australian Super Developments Pty Ltd & Ors v Marriner & Ors (2010) VSC 41 (Byrne J), Australian Super Developments Pty Ltd & Ors v Marriner & Ors (No 2) (2010) VSC 66 (Byrne J), Australian Super Developments Pty Ltd v Marriner & Ors (2014) VSC 464 (Sloss J), and Australian Super Developments Pty Ltd (No 2) (2015) VSC 315 (Sloss J).

[3] Marriner & Ors v Australian Super Developments Pty Ltd (2012) VSCA 290, Marriner & Ors v Australian Super Developments Pty Ltd (No 2) (2012) VSCA 290, Marriner & Ors v Australian Super Developments Pty Ltd (2016) VSCA 141, Marriner & Ors v Australian Super Developments Pty Ltd (No 2) (2016) VSCA 150.

[4] Paragraph 2 of the affidavit of James Murray Pergl affirmed 12 November 2018.

[5] Paragraph 10 of the affidavit of James Murray Pergl affirmed 12 November 2018.

[6] Legal Profession Act 2004 - Schedule 2 - clause 3.1(1).

[8] Par.8 ('in discharge of that retainer'), par.9(c) & (e) ('as part of the retainer'), par.13 ('running of the matter'), all of par.17 and par.18 ('pursuant to the retainer').

[11] Goldworthy Pty Ltd, Stage Design Pty Ltd, Laguna Australia Airport Pty Ltd, and Laguna Australia Pty Ltd.

[19] Page 2 of the respondent's letter of 5 May 2005.

[20] Letter of 25 September 2018 from the respondent to the Costs Court accompanying the documents relied upon in 'Annexure A'.

[22] Paragraph 6 of the applicant's affidavit.

[23] Paragraph 10 of the applicant's affidavit.

[24] Paragraphs 10.1 and 10.2 of the applicant's affidavit.

[25] Paragraphs 6 and 13 of the affidavit.

[26] Exhibit 'DM 1' and paragraph 11 of the affidavit.

[28] Transcript - 8 February 2019 - page 59 - lines 6 to 16.

[29] Transcript - 8 February 2019 - page 23 - lines 8 to 15.

[30] For example, section 3.4.38(3) of the 2004 Act.

[31] Paragraph 6 of the applicant's written submission.

[32] Transcript - 8 February 2019 - page 28 - lines 9 to 12.

[37] [1999] FCA 405; (1999) 162 ALR 482 at [107].

[38] [1934] HCA 28; (1934) 51 CLR 143 at 156.

[39] 4th Edition (Lexis Nexis Butterworth) at 2.12.

[40] (2013) NSWSC 469.

[42] Ibid at [73] and [74] and Transcript - 8 February 2019 - page 9, line 23 to page 12, line 13.

[43] Paragraphs 10 and 11 of the applicant's written submissions.

[44] Section 86(1)(c) of the 1996 Act and section 3.4.9(1)(c) of the 2004 Act.

[45] Section 89 of the 1996 Act and section 3.4.16 of the 2004 Act.

[46] South Australia v Victoria [1911] HCA 17; (1911) 12 CLR 667, 675 (Griffith CJ).

[47] Re Judiciary and Navigation Acts [1921] HCA 20; (1921) 29 CLR 257, 265.

[48] Phillip Morris Inc v Adam P Brown Male Fashions Pty Ltd (1981) 33 ALR 465, 500 (Mason J).

[51] [2006] VCAT 1714 (per Judge Bowman, and Members E. Hannebery & L. Coony).

[55] [2007] FCA 353; (2007) 158 FCR 206.

[57] Paragraphs 9, 11.4 and 12 of the applicant's written submissions.

[58] Submission of the respondent - Transcript - 8 February 2019 - page 31 - lines 8 to 16.

[59] There is a limited ability to do this in the 1996 Act - s 115(2)(b).

[60] Paragraph 8 of the applicant's written submission and Transcript - 8 February 2019 - page 12, line 27 to page 13 line 8.

[61] Transcript - 8 February 2019 - page 15 - lines 8 to 9.

[62] Transcript - 8 February 2019 - pages 50 to 53.

[63] Transcript - 8 February 2019 - page 29, line 28 to page 30, line 1.

[64] Paragraph 12 of the applicant's affidavit.

[65] Paragraph 18 of the affidavit of James Murray Pergl.

[66] (2016) VSCA 141 at paragraph 1.