BOLT -v- BOLT [2023] WASC 162 (22 May 2023)

BOLT -v- BOLT [2023] WASC 162 (22 May 2023) - WASC 2023 case summary — Zoe

[28]

On 22 May 2023 I published my reasons for decision in relation to an application brought by the first to fourth defendants (Defendants) in which they sought orders that certain paragraphs of the statement of claim filed in this matter be struck out as an abuse of process. I concluded that the application should be dismissed: Bolt v Bolt [2023] WASC 162.
An advance copy of my reasons was provided to the parties to facilitate conferral about the orders that should be made to reflect those reasons. The parties managed to reach agreement about most of the orders, including orders that the Defendants pay the plaintiff's costs of the application to be taxed, if not agreed. However, the Defendants did not agree that a special costs order should be made pursuant to s 141(3) of the Legal Profession Uniform Law Application Act 2022 (WA) (Uniform Act). Specifically, the Defendants did not accept that the plaintiff's costs of the application should be assessed without regard to the maximum allowances fixed in item 10 of the Legal Profession (Supreme and District Courts) (Contentious Business) Determination 2022 (Costs Determination), which relates to work done in connection with proceedings in chambers.
Very shortly before I published my reasons for decision the plaintiff filed an outline of submissions in support of a contention that a special costs order should be made. The plaintiff also filed an affidavit sworn by Camilla D'Angelo Radenti, a solicitor employed by the firm that acts on behalf of the plaintiff.
Because the Defendants did not have sufficient opportunity to deal with the plaintiff's submissions or evidence, I made orders programming the filing of written submissions and affidavit evidence in relation to the question of whether a special costs order should be made. I also made an order that the plaintiff's application for costs be determined on the papers.
Subsequently, the Defendants filed an outline of submissions and an affidavit that was sworn by a partner of the firm which represents the Defendants in these proceedings, Alistair Ronald Fleming.
The plaintiff then filed an outline of submissions in response.
In my view, and for the following reasons, the plaintiff's application for a special costs order should be allowed.

[39]

If the answer to both of those questions is 'yes', then the court may do all or any of the things referred to in s 141(3)(a) - (d) of the Uniform Act. In this case the plaintiff submits that the court should exercise the power provided for in s 141(3)(c) by removing the limits that are fixed under item 10(a) of the Costs Determination, namely, costs relating to proceedings in chambers.
The issues that arise when a court is required to consider whether it has formed the opinion that is referred to in s 141(3) of the Uniform Act should be dealt with based on impression, rather than by conducting a detailed and precise evaluation. This means that it will not ordinarily be necessary for the court to determine what amount should be allowed on taxation, but only whether there is a fairly arguable case that a greater amount should be allowed than is otherwise allowable under the relevant costs determination. The mere fact that a party incurred greater costs than those that are allowable will not, of itself, suffice.
It does not necessarily follow that a party who is a beneficiary of an order made under s 141(3) of the Uniform Act will recover costs in an amount that exceeds the amount allowable under the relevant determination. This is because if a special costs order is made it will then be up to the taxing officer to 'consider the reasonableness of and necessity for the work undertaken, and to make a judgment about the remuneration reasonably required'.[39]
The word 'unusual' in s 141(3) only qualifies the word 'difficulty', and not the words 'complexity' or 'importance'.[40] However, the plaintiff does not assert that any inadequacy in the costs allowable under the Costs Determination arises because of the unusual difficulty of the matter. The plaintiff says that the amount of costs allowable under item 10(a) of the Costs Determination is inadequate because of the complexity or the importance of the matter.
In BCBC Singapore Pte Ltd v Pt Bayan Resources Tbk [No 5] [2023] WASC 116 [75] ‑ [79], Archer J explained the meaning of the word 'importance', in the context of applications for special costs orders, as follows:

[51]

The Defendants submit that the plaintiff's application for a special costs order must fail because the evidence in support of the Application is inadequate. In that regard, the Defendants note that the plaintiff has not adduced any evidence of a draft bill of costs, and has not specified the total amount proposed to be claimed by the plaintiff. The Defendants further say that the plaintiff has not provided sufficient detail in relation to the circumstances in which costs were incurred.
The Defendants also submit that beyond bare assertions that the Application was complex and of importance, the plaintiff does not explain why the court should reach those conclusions, and say that it is insufficient to simply refer to the length of the written submissions filed by the parties.
By reference to several 'characteristics' of the Application, the Defendants submit that there is limited evidence that would support a special cost order being made. Amongst other matters, the Defendants point to the fact that the Application was only concerned with nine paragraphs of the statement of claim and four documents, neither party relied on any evidence, and the resolution of the Application depended upon the application of settled principles relating to without prejudice privilege. The Defendants also say that the written submissions filed by the parties were not lengthy, noting that the plaintiff's written submissions were relatively short, with the longest stretching to only 11 pages.
The Defendants submit that considering the hearing took three hours, and not a full day, the two-day maximum allowed for in item 10(a) of the Costs Determination provides adequate scope for the taxation of the plaintiff's costs for preparing the Application.
The Defendants do accept that supplementary written submissions had to be filed after the hearing. However, it is submitted that this is not unusual, and that it does not of itself mean that a special costs order should be made. In the alternative, the Defendants submit that if the court decides to make a special costs order, then it should only allow a 'small increase' above the maximum amount specified in item 10(a) of the Costs Determination to allow for those further submissions.

[55]

Accordingly, I am required to reach a view about whether it is fairly arguable that a taxing officer may find that the costs incurred by the plaintiff in doing work that was necessary and reasonable to prepare for and appear at the hearing of the Application may be allowed in an amount greater than the maximum amounts allowed in item 10(a) of the Costs Determination.
The rates set out in item 10(a) are the maximum daily rates[48] that are applicable for work done by counsel in relation to proceedings in chambers. While the maximum rates are expressed as global figures,[49] they relate to work done both in preparation for, and while appearing at, a hearing in chambers. The rates are based on a hearing that does not exceed one day, and on the assumption that the time spent in preparing for a hearing in chambers will not exceed two days.
The Costs Determination does not expressly indicate what type of work constitutes 'preparation', for the purposes of item 10(a). However, the commentary in Civil Procedure: Western Australia, vol 1 [66.11.9][50] suggests that the allowance relevantly covers the preparation of written submissions,[51] preparing for a hearing in chambers, and the appearance in chambers to argue the Application.
Given that orders were made that the parties were to file supplementary written submissions to deal with issues that arose during the hearing of the Application, it seems to me that any costs incurred in doing that work would also fall to be considered by reference to item 10(a), on the basis they formed part of the preparation for, or constituted a part of, the appearance in chambers.
Ms Radenti's evidence is that the plaintiff's solicitors have spent approximately 76 hours working on the Application. However, that evidence is expressed at a very high level of generality. Based on that evidence alone, I am unable to reach any meaningful impression about whether it is fairly arguable that a taxing officer might conclude that the costs relating to work that was necessary and reasonable may be allowed in an amount that exceeds the maximum amounts allowed under item 10(a) of the Costs Determination.
Nevertheless, based on my own knowledge of the case and its circumstances, and informed by Ms Radenti's evidence, I am of the view that it is fairly arguable that costs may be allowed in an amount that exceeds the maximum amounts allowed under the Costs Determination.
Had the Defendants' Application succeeded then this would almost certainly have spelled the end of the plaintiff's second proprietary estoppel claim. Although this observation is relevant to the second question that I am required to answer in the context of the plaintiff's application for special costs, it also informs the question of whether it is arguable that the costs associated with the reasonable and necessary work done by the plaintiff's legal advisers will exceed the amount allowed under the Costs Determination.
It is difficult to conclude that the plaintiff's own written submissions in opposition to the Application required a significant amount of time to prepare, having regard to their length and contents. However, in the light of the above background, I accept that the plaintiff's legal advisers are likely to have had to spend a significant amount of time considering the Defendants' detailed written submissions (both in chief and in reply), including the numerous authorities to which the Defendants referred, in order to prepare written submissions in response, and to prepare for making oral submissions at the hearing of the Application.
It is true that the hearing did not take a full day. However, that does not necessarily mean that the plaintiff was not required to carry out work in advance of the hearing that may have reasonably exceeded the two-day maximum provided for in item 10(a) of the Costs Determination. Written submissions can result in a significant reduction in the time required for a hearing.
As I have already noted, because issues were raised at the hearing of the Application, orders were made that required the preparation of further written submissions. Initially, orders were made that the plaintiff was to file further written submissions, and that the Defendants were to file submissions in response. However, I subsequently made orders after the Defendants had filed their submissions, which allowed the plaintiff to file further supplementary submissions to deal with an additional issue raised by the Defendants.
Ultimately, when I look at the documents that have been filed, and what occurred during and after the hearing of the Application, and when I then take into account Ms Radenti's evidence about the time that has been spent by the plaintiff's legal advisers dealing with the Application, I am of the opinion that it is fairly arguable that costs may be allowed in an amount that exceeds the maximum amount allowed under item 10(a) of the Costs Determination.
I will now turn to deal with the second question that arises in the context of an application for a special costs order.

[57]

In my view, the amount of costs allowable under item 10(a) of the Costs Determination is not inadequate because of the complexity of the Application. The pleadings that have been filed in this case show that the plaintiff's claim is likely to be both factually and legally complex. However, the relevant focus for the purposes of the plaintiff's application for a special costs order is 'the matter', namely, the Application.
It can be seen from my reasons for dismissing the Application that it was not necessary for me to grapple in any substantial way with the factual or legal issues that are likely to arise at trial. Further, neither party adduced any evidence at the hearing that was relevant to the issues raised by the Application. The Defendants only relied on some limited evidence for the purpose of justifying the delay in bringing the Application.
The Application proceeded based on the pleadings, and by reference to five relatively uncomplicated documents. The essential issue for me to decide was whether certain communications between the parties were conducted on a without prejudice basis by reference to the question of whether litigation was contemplated, or might reasonably have been contemplated, at the time of those communications. In short, the Application was not complex.
However, I am of the opinion that the inadequacy of the amount of costs allowable under item 10(a) of the Costs Determination, in the relevant sense, arises because of the importance of the Application.
The Application was important because of the significance of the issues to the parties. In reaching that conclusion I am conscious that a matter will not be 'important', for the purposes of s 141(3) of the Uniform Act, simply because a party considers it to be.
At paragraph 59 of the statement of claim the plaintiff pleads that the first and second defendants acted to induce, encourage and acquiesce in what is referred to in the pleadings as the 2016 Assumptions. By that paragraph the plaintiff pleads, in support of his second proprietary estoppel claim, both an essential element of proprietary estoppel by encouragement and of proprietary estoppel by acquiescence.[52] The plaintiff's case is that the first and second defendants 'acted to induce, encourage and acquiesce' by acting as pleaded in paragraphs 60 - 63, 64 ‑ 69, 71, and 73 - 78 of the statement of claim. Therefore, these paragraphs form a critical part of the plaintiff's second proprietary estoppel claim.
If I had allowed the Application, in which the Defendants sought orders that paragraphs 65, 66, and 68 - 72 be struck out, it is obvious that it would have had very significant, if not fatal, consequences for the plaintiff's second proprietary estoppel claim. There would also be no question of granting the plaintiff leave to re-plead.
The Defendants also sought to strike out paragraphs 83 and 84 of the statement of claim. The facts pleaded in those paragraphs form an important part of the plaintiff's case because they are relied on, in part, to establish that the Defendants sought to resile from the assumptions that underpin both of the plaintiff's proprietary estoppel claims. If those paragraphs had been struck out, that would have had serious consequences for both of the plaintiff's proprietary estoppel claims.
I accept the plaintiff's submission that the Application's importance is, to some extent, confirmed by the Defendants' submissions that were relied on in support of the Application. Paragraphs 5 ‑ 7 of the Defendants' reply submissions were in the following terms:
1. The plaintiff makes the uncontroversial point that interlocutory disputes are discouraged in modern litigation because of the costs, the time, and the fact that interlocutory applications are usually not significant in the context of the whole proceeding.
2. However, resolving whether the plaintiff can rely on and disclose the Communications which the defendants say attract and retain without prejudice privileged is not a minor or peripheral issue. To the contrary, and as the plaintiff has admitted, the Communications underpin his 2016 Assumptions, being one of the two estoppel claims pleaded by the plaintiff.
3. This issue is ripe for determination now, as the outcome will have a significant impact on the substance of the pleadings of both parties, [and] any evidence required to meet the case put by the plaintiff. In particular:

[59]

Although Ms Radenti's evidence is lacking in detail, it does show that the plaintiff's legal representatives spent a considerable amount of time working on the Application, which far exceeded the 30 hours that are allowed for under item 10(a) of the Costs Determination. As Allanson J said in Power and Water Corporation v Eni Australia B.V [2022] WASC 376 (S) [19], the court should not fall into the trap of making an estimate of the time that should have been spent by the plaintiff dealing with the Application when the court does not have all of the information that would be necessary to make such a judgment. It will be for the taxing officer to decide whether, and to what extent, that work was necessary and reasonable.
In the light of the potential significant consequences of the Application and having regard to what occurred at the hearing of the Application, and to the documents that were filed by the parties (particularly the written submissions), my overall impression is that it is arguable that the plaintiff's lawyers carried out the work referred to by Ms Radenti because of the importance of the Application.
Accordingly, I am of the view that it is fairly arguable that the bill that will be presented to a taxing officer in relation to the Application may properly tax at an amount that is greater than the maximum allowable under item 10(a) of the Costs Determination, and that this is because of the importance of the Application.
On that basis I am prepared to make a special costs order in relation to the Application pursuant to s 141(3) of the Uniform Act.
The Defendants submit that if I form the opinion required by s 141(3) of the Uniform Act then instead of removing the limits on costs fixed by item 10(a) of the Costs Determination, I only should fix slightly higher limits pursuant to s 141(3)(b) to make allowance for the fact that further written submissions were required to be filed.
While there is merit in the Defendant's submission, I am of the view that the appropriate order is to remove the limits on costs fixed in the Costs Determination pursuant to s 141(3)(c) of the Uniform Act. Detailed consideration about how, and to what extent, the work that was done by the plaintiff's legal advisers in the course of preparing for and appearing at the hearing of the Application should be assessed in accordance with item 10(a) of the Costs Determination is best left to the taxing officer to decide. As I have already said, a special costs order does not entitle the plaintiff to automatically recover his costs in an amount that exceeds the amount allowable under item 10(a). It will up to the taxing officer to consider the reasonableness of and necessity for the work undertaken, and to use their expertise to make a judgment about the remuneration reasonably required.
I would make the following orders:

Legislation Cited (5)

Legal Profession Act 2008(WA)

Profession Uniform Law Application Act 2022

Aid Commission Act 1976

Liability Act 2002

Motor Vehicle (Third Party Insurance) Act 1943

Cases Cited (33)

Alan Ramsay Sales & Marketing Ltd v Typhoo Tea Ltd [2016] EWHC 486; [2016] 4 WLR 59

Australian Competition and Consumer Commission v NSW Ports Operations Hold Co Pty Ltd [2020] FCA 1232

Barrett Property Group Pty Ltd v Dennis Family Homes Pty Ltd (No 2) [2011] FCA 276; (2011) 193 FCR 479

Brown v Barber [2020] WASC 84

Chang v Legal Profession Complaints Committee [No 2] [2020] WASCA 208 (S)

CMA Assets Pty Ltd Formerly Known as CMA Contracting Pty Ltd v John Holland Pty Ltd [No 4] [2013] WASC 77

Commonwealth Director of Public Prosecutions v Citigroup Global Markets Australia Pty Limited (No 3 - Privilege Claims) [2021] FCA 1208

Dowling v Ultraceuticals Pty Ltd [2016] NSWSC 386

English v Vantage Holdings Group Pty Ltd [2021] WASCA 47

Field v Commissioner for Railways for New South Wales [1957] HCA 92; (1957) 99 CLR 285

Harrington v Lowe [1996] HCA 8; (1996) 190 CLR 311

Hodgkinson & Corby Ltd v Wards Mobility Services Ltd [1997] FSR 178

Insurance Commission of Western Australia v Woodings as Liquidator of Bell Group Ltd (in Liq) (No 2) [2017] WASC 372

Morgan v Whanganui College Board of Trustees [2014] NZCA 340; [2014] 3 NZLR 713

Oceanbulk Shipping & Trading SA v TMT Asia Limited [2010] UKSC 44; [2011] 1 AC 662

Old Papa's Franchise Systems Pty Ltd v Camisa Nominees Pty Ltd [2003] WASCA 11

Pigozzo v Mineral Resources Ltd [2022] FCA 1166

Re QRD Development Company No. 3 Designated Activity Company [2022] IEHC 498

Rodgers v Rodgers [1964] HCA 25; (1964) 114 CLR 608

Saffari v Western Australia Police [2022] WASC 200

Samnakay v Schofield [2013] WASCA 138

Vantage Holdings Group Pty Ltd v Donnelly [No 4] [2019] WASC 398

Verge v Devere Holdings Pty Ltd [2009] FCA 832; (2009) 258 ALR 464

Woodings as liquidator of The Bell Group Ltd and the Bell Group Finance Pty Ltd v WA Glendinning & Associates Pty Ltd [2019] WASC 54

Wright Prospecting Pty Ltd v Hancock Prospecting Pty Ltd (No 13) [2021] WASC 214

Yokogawa Australia Pty Ltd v Alstom Power Ltd [2009] SASC 377; (2009) 262 ALR 738

(2011) 193 FCR 479

(1957) 99 CLR 285

(1996) 190 CLR 311

(1964) 114 CLR 608

(2009) 258 ALR 464

(2009) 262 ALR 738

(2001) 1 Qd R 233

At a glance

Court

Decision date

Before

Source

Judgment (99 paragraphs)

Legislation Cited (5)

Cases Cited (33)