Ascic v Comcare

Federal Court of Australia|2023-04-06|Before: Smith J

The applicant is to pay the respondent's costs of the application fixed in the sum of $17,512.77. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

BANKS-SMITH J: 1 Mr Ascic applied to this Court under s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) by way of an appeal from a decision of the Administrative Appeals Tribunal that no permanent impairment compensation was payable to him under the Safety, Rehabilitation and Compensation Act 1988 (Cth). 2 I dismissed the application: Ascic v Comcare [2021] FCA 1498. At the time, I indicated to Mr Ascic that I would allow him the opportunity to be heard as to the costs of his unsuccessful application. 3 Mr Ascic sought leave to appeal to the Full Court from the orders dismissing his application, but his application was refused: Ascic v Comcare [2022] FCA 1245. 4 For various reasons the issue of costs was not determined at that time, but I have now received submissions from both Comcare and Mr Ascic, and it was agreed that I would determine the question of costs on the papers.

Costs sought by Comcare 5 Comcare submitted that costs should follow the event, and be determined in accordance with the lump-sum costs order regime outlined in the Federal Court's Costs Practice Note (GPN-Costs). It seeks an order that Mr Ascic pay its costs of the application fixed in the sum of $17,512.77. 6 I agree that costs should follow the event. That is, Mr Ascic as the unsuccessful applicant should pay Comcare's costs of the application. There was nothing unusual about the application or its outcome that would justify a different conclusion. 7 In support of its application, Comcare relies on a costs summary affidavit of Daphne Jones-Bolla dated 14 December 2021. This affidavit is anticipated by para 4.10 of GPN-Costs. Annexure A to GPN-Costs details the types of matters that should be verified by the deponent of an affidavit in support of the claimed costs, and the content of the costs summary. 8 Ms Jones-Bolla is a lawyer employed by Comcare's solicitors on the record in this matter, Sparke Helmore Lawyers, and has provided the necessary verification. 9 Further, Ms Jones-Bolla has addressed the content requirements. In particular, she has deposed to the following matters. 10 Approximately 36% of the total legal costs claimed represent counsel's fees. Counsel fees were charged at $204.54 per hour or $1,227.27 per day as appropriate (both excluding GST), being less than rates provided for by the Court's National Guide to Counsel Fees. 11 Comcare does not claim any additional amount for skill, care and responsibility. 12 Sparke Helmore Lawyers utilises Intapp Time and Aderant, two digital systems, for time billing and recording. Intapp Time records the description for each task undertaken, the time spent by a fee earner in performing the task and the monetary value of the task performed by the fee earner. Aderant records this information and the monetary value of any disbursements incurred in relation to the file. 13 Having regard to the Aderant records, Ms Jones-Bolla considered that the following categories of work undertaken during the proceedings gave rise to the given percentage of the total legal costs: (a) responding to the application up to and including the case management hearing constituted approximately 15% of the total legal costs; (b) taking instructions, liaising with counsel and advising Comcare of the application constituted approximately 35% of the total legal costs; (c) preparing documents for use in the application and briefing counsel in respect of the written submissions constituted approximately 30% of the total legal costs; (d) preparing for and appearing at the final hearing constituted approximately 30% of the total legal costs; and (e) receiving judgment constituted approximately 2.5% of the total legal costs. 14 Ms Jones-Bolla identified the persons from Sparke Helmore Lawyers who were involved in the proceedings and considered their level of experience and expertise. She provided the hourly rate, hours billed and the percentage of the total claim attributed to those persons. 15 Having regard to the verifiable records, Ms Jones-Bolla calculated that Comcare incurred a total of $14,964 (excluding GST) in professional fees in this matter (not including the costs incurred in preparing the cost summary and reviewing and advising on the judgment). Of that $14,964, Comcare seeks recovery from Mr Ascic of some 75%, being $11,223. 16 The total legal costs claimed by Comcare in relation to the proceedings are therefore in the sum of $17,512.77, made up as follows: (a) $11,223.00 (excluding GST), being some 75% of the professional costs incurred; and (b) $6,289.77 (excluding GST), being 100% of counsel's fees for all work up to and including the final hearing.

Principles 17 In Hislop v Paltar Petroleum Limited (No 4) [2017] FCA 1632 Gleeson J set out the following principles relevant to lump sum costs assessments: [6] The usual rule, which applies in this case, is that costs are payable on a party and party basis: rr 40.01 and 40.02. Costs as between party and party are defined in the Dictionary (Sch 1 to the Rules) as 'only the costs that have been fairly and reasonably incurred by the party in the conduct of the litigation'. In contrast, an award of costs on an indemnity basis is intended to compensate a party fully for costs where it was unreasonable for the party to be subject to any expenditure of costs, such as where a hopeless proceeding is brought: see Bitek Pty Ltd v iConnect Pty Ltd [2012] FCA 506; (2012) 290 ALR 288 ('Bitek') at [12]. [7] Specification of a lump sum is not the result of a process of taxation or assessment of costs; the sum can only be fixed broadly having regard to the information before the Court; the approach taken to estimate costs must be logical, fair and reasonable: Harrison v Schipp [2002] NSWCA 213; (2002) 54 NSWLR 738 at [22]. The task is one of estimation or assessment and not of arithmetic: Bayley & Associates Pty Ltd v DBR Australia Pty Ltd [2014] FCA 346 at [17(e)]. The sum of costs fixed should be proportionate to the nature, including the complexity, of the case: Bitek at [18]. [8] The starting point for the fixing of costs is the charges rendered by Mr Hislop's solicitors. Then, there may be an 'impressionistic discount of the costs actually incurred or estimated, in order to take into account the contingencies that would be relevant in any formal costs assessment': Bitek at [18], citing Hamod v New South Wales [2011] NSWCA 375 at [820]. However, the court must be 'astute not to cause an injustice': Bitek at [23]. [9] In Hancock v Rinehart (Lump sum costs) [2015] NSWSC 1640, Brereton J made the following observations concerning the application of a discount in determining a lump sum costs order, where costs were ordered to be paid on an indemnity basis: [56] The first defendant submits that there should be a further global percentage reduction of 15%, for two main reasons: first, because on assessment, even on the indemnity basis, a successful party invariably recovers something less than its actual costs, typically 15% where the assessment is on an indemnity basis; and secondly, the necessarily broad-brush approach of the court to assessment on a lump sum basis - involving some risk that the sum includes costs that would not be recovered on assessment - coupled with the savings to the costs creditor in time and costs through avoiding a detailed assessment, and the loss to the costs debtor of the opportunity to scrutinise and object to a detailed bill, has resulted in a practice of applying a discount on lump sum assessments. [57] While it is undoubtedly the usual practice of the court when making a lump sum costs order to apply a discount for the reasons mentioned, that does not mean that the Court must apply a percentage discount to the sum sought by the successful party and the Court 'must be astute not to cause an injustice to the successful party' by applying 'an arbitrary 'fail safe' discount on the costs estimate submitted to the court'. Thus if the court can be confident that there is little risk that the sum includes costs that might be disallowed on assessment, the case for a discount is seriously undermined. (footnotes omitted) 18 Another useful extract is the following from Bitek Pty Ltd v IConnect Pty Ltd [2012] FCA 506 where Kenny J stated: [23] It must also be borne in mind that, in making a lump sum costs order, the Court is not required to undertake a detailed examination of the kind that would be appropriate to taxation or formal costs assessment: see Harrison v Schipp (2002) 54 NSWLR 738 per Giles JA at 743 [21]-[22]; Hadid v Lenfest Communications Inc [2000] FCA 628 at [35] per Lehane J; and Auspine Ltd v Australian Newsprint Mills Ltd (1999) 93 FCR 1 at 5 per O'Loughlin J. Indeed, to do so would defeat the purpose of making a lump sum costs order. Adopting a less exacting approach than would be applied on taxation, but bearing in mind that there is only Mr Tye's evidence before the Court and that the Court must be astute not to cause an injustice to anyone including the respondents, I am satisfied that Mr Tye has not calculated costs in an excessive amount.

Mr Ascic's submissions 19 Mr Ascic's submissions sought to re-agitate the matters that were the subject of the application before me and the application for leave to appeal. They did not engage with the materials filed in support of the lump sum costs order. I understand that Mr Ascic continues to feel aggrieved by the outcome of this particular pursuit of compensation. However, contrary to Mr Ascic's submissions, I do not accept that there was anything illegal in the process undertaken by Comcare or that it otherwise conducted itself in a manner that was unauthorised. There has been no finding made with respect to Comcare that would justify it being disentitled to its costs.

Consideration 20 For context, it is to be noted that I case managed and heard Mr Ascic's application, and so I am familiar with the issues that were in play and the kind of work that was undertaken on behalf of Comcare. 21 I am satisfied that Ms Jones-Bolla has gone to appropriate lengths to consider the source, make-up and rates of the costs and disbursement incurred. She has undertaken a process that commenced with a consideration of actual costs, considered scale rates where applicable, and considered and applied discounts before indicating a figure that is the amount claimed. 22 I take into account the difficulty of some of the matters that needed to be addressed in the application. It seems to me that Ms Jones-Bolla has carefully and responsibly considered the amount of costs that should sensibly be claimed from Mr Ascic. I take into account that Ms Jones-Bolla had already applied a discount to the amount of the professional fees otherwise payable by Comcare. I consider that the discount is appropriate and sufficient: see generally my collection of some of the ranges of discounts reflected in the cases in Zafra Legal Pty Ltd v Harris (Liquidator) (No 3) [2021] FCA 441 at [120]. 23 I do not consider it is necessary to apply any further discount to that amount in all the circumstances. There is no suggestion that solicitors of an inappropriate level were utilised or that excessive amounts of work were undertaken in the course of the proceeding. Nor is there evidence of inappropriate duplication or delegation of work. The use of counsel was sensible in a matter of this nature and the fees charged were, in my view, conservative. Having regard to Ms Jones-Bolla's evidence, I am satisfied that the work undertaken and the amounts charged were fair and reasonable. 24 I therefore determine that the costs in the lump sum sought by Comcare are reasonable and appropriate. 25 There will be an order accordingly. I certify that the preceding twenty-five (25) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Banks-Smith.

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