Dye v Fisher Cartwright Berriman Pty Ltd

Civil Procedure Act 2005, s 98(1) LEGISLATION CITED : Legal Profession Act 2004, ss 302, 309, 310, 312, 350 Uniform Civil Procedure Rules 2005, r 42.1

CASES CITED : Holt v Wynter (2000) 49 NSWLR 128

PARTIES : Vivienne Dye (Plaintiff) Fisher Cartwright Berriman Pty Ltd (Defendant)

COUNSEL : Plaintiff - Mr D O'Sullivan Defendant - Mr G Boyce

SOLICITORS : Plaintiff - In person Defendant - FCB Workplace Lawyers & Consultants

• 7 - IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION DUTY LIST

2010/00068261 VIVIENNE DYE V FISHER CARTWRIGHT BERRIMAN PTY LTD

JUDGMENT 1 HIS HONOUR: By summons filed on 17 March 2010 the plaintiff Vivienne Dye makes an application for an extension of time for a costs assessment pursuant to s 350 of the Legal Profession Act 2004. The application is opposed by the defendant, Fisher Cartwright Berriman Pty Ltd which acted for the plaintiff between June 2008 and October 2009. Two affidavits were read in the plaintiff's support, being affidavits of the plaintiff affirmed on 13 May 2010 and 8 June 2010. Mr Gee, solicitor, affirmed an affidavit on 26 May 2010 on behalf of the defendant and by way of response to the plaintiff's case. Mr Gee had the conduct of the matter in respect of which the defendant had taken instructions. The instructions received related to proceedings brought by the plaintiff in the Federal Court of Australia. 2 A reading of the affidavits discloses that there are assertions made by the plaintiff which are disputed by Mr Gee. However neither deponent was required for cross-examination and it was not possible for me to determine which account is to be preferred on disputed aspects. In any event the outcome of this application does not depend on a resolution of those disputed matters. 3 Section 350 of the Legal Profession Act 2004 provides so far as is relevant:

"(1) A client may apply to the Manager, Costs Assessment for an assessment of the whole or any part of legal costs.

(4) An application by a client … for a costs assessment under this section must be made within 12 months after: (a) the bill was given or the request for payment was made to the client …, or (b) the costs were paid if neither a bill was given nor a request was made.

(5) However, an application that is made out of time, otherwise than by: (a) a sophisticated client, …. …. …. may be dealt with by the costs assessor if the Supreme Court, on application by the costs assessor or the client … who made the application for assessment, determines, after having regard to the delay and the reasons for the delay, that it is just and fair for the application for assessment to be dealt with after the 12-month period. …". 4 The term "sophisticated client" is defined in s 302 of the Act as meaning a client to whom disclosure under s 309 or s 310(1) is not required because of s 312(1)(c) or (d). Clearly the plaintiff does not fall into any of the categories of clients identified in s 312(1)(c). Nor has she been engaged in any relevant tender process for the purposes of s 312(1)(d). 5 I am satisfied for the purposes of s 350(5) that the plaintiff is not a "sophisticated client" and indeed Mr Boyce does not contend otherwise. 6 What happened in the present case is that the plaintiff filed an application for an assessment of costs on 14 December 2009. The application related to three invoices for professional services provided by the defendant:

(i) Invoice number 231868 relating to work performed in the month of October 2008.

(ii) Invoice number 232012 relating to work performed during the month of November 2008, and

(iii) Invoice number 232265 relating to work performed in the month of December 2008. 7 From the chronology presented by counsel it is noted that these invoices were provided to the plaintiff on 13 November 2008, 5 December 2008 and 15 January 2009 respectively. Hence it is common ground that the invoices delivered on 13 November 2008 and 5 December 2008 should have prompted an application for assessment by the plaintiff before her application on 14 December 2009. That application was out of time by a month in relation to the earliest of the three invoices identified above, and the plaintiff was out of time by nine days in relation to the second of the invoices identified above. 8 The issue in these circumstances is whether "it is just and fair" for the application presented to be dealt with so far as the two earlier invoices are concerned "having regard to the delay and the reasons for the delay". 9 Mr O'Sullivan on the plaintiff's behalf submitted the issue should be determined in the plaintiff's favour. The delay was slight and was excusable having regard to the plaintiff's circumstances. On the other hand Mr Boyce submitted that no good reasons have been advanced for the delay and that the application was advanced on a basis that was misconceived because the plaintiff grounded her objection to the two earlier invoices on a misconception about the stage to which the items costed were related. Mr Boyce further drew attention to the fact that s 350 was amended as from 1 July 2007. The effect of the amendment was to extend what had been a 60 day period for making the application to the 12 month period for which provision is now made. In consequence, Mr Boyce submitted the Court in having regard to this significant increase should be slow to grant an extension in any event. 10 I have reflected on the competing submissions which I have shortly summarised. 11 The plaintiff entered into a costs agreement with the defendant in June 2008. As to the asserted misconception about the items challenged, Schedule 1 to that agreement (annexure A, to the affidavit of the plaintiff affirmed 14 may 2010) identified 3 stages of the professional services then contemplated, and provided a range of estimates for each stage. Mr Boyce submitted that in challenging the first two invoices the plaintiff was in error in attributing items in those invoices to stage 2 work. It seems to me that whether the items which the plaintiff seeks to challenge in the application lodged are properly allowable is a matter appropriately to be determined by the costs assessor. 12 The items challenged are valued by the defendant at $15,315.75, according to the plaintiff's calculations. I am not certain how that figure is arrived at but it is clear on any view of the matter that there is a challenge in respect of the two earlier bills which if completely successful would reduce any amount properly recoverable by way of costs by an amount close to $11,000. The most recent of the three invoices in respect of which the application has been brought in time presents a claim for $4,969.05 so that altogether the plaintiff's challenge if completely successful would reduce her indebtedness by an amount in excess of $15,000. 13 Prior to the amendments introduced to the Legal Profession Act by Act Number 116 of 2006, s 350(4) required that an application for a costs assessment must be made within 60 days after the bill was given or request for payment was made or after the costs were paid in full (whichever occurred first). Section 350(5) provided:

"However, a costs assessor must deal with an application made out of time, unless the costs assessor considers that the law practice has established that to do so would, in all the circumstances, cause unfair prejudice to the law practice". 14 It is to be observed then that the time for making an application for a costs assessment has been very significantly extended. On the other hand "unfair prejudice to the law practice" as the consideration dictating whether an application made out of time ought to be considered has been replaced by the broader concept of what is "just and fair" having regard to "the delay and the reasons for it". Prior to the amendment it was for the law practice to establish that dealing with an application out of time would cause unfair prejudice to it. Since the amendment the onus is on the party making the application to establish that it is just and fair for the application to be dealt with. 15 Mr Boyce is correct of course to point out that the period for the making of an application within time has been extended to a very significant extent by reason of the amendments to the section, but it is nevertheless necessary for the Court to have regard to the extent of the delay beyond the 12 month period now fixed by the statute. In this case the delay is by no means substantial. 16 In the later of her affidavits (in paragraphs 14-18) the plaintiff has advanced as reasons for the delay:

(i) That Mr Gee filed a notice of ceasing to act for her in her Federal Court proceedings the subject of this current costs assessment application on 23 October 2009.

(ii) That the plaintiff was subsequently occupied with finding alternative legal representation in those proceedings whilst representing herself for some period.

(iii) That earlier in September 2009 the plaintiff gave evidence as a witness in proceedings in the Supreme Court of this State and her evidence attracted what the plaintiff described as "wide spread and salacious media coverage" that was distressing her at the time Mr Gee filed the notice of ceasing to act. A newspaper item dated 16 September 2009 evidencing media coverage was annexed to the later of the two affidavits of the plaintiff. (see Exhibit A5 to that affidavit) 17 As I observed earlier the plaintiff was not required for cross-examination on her affidavits and I accept for present purposes that the plaintiff was distracted from filing her application within time because of the reasons set out above. 18 Notwithstanding the difference in the test now to be applied compared with the language of s 350(5) before the amendment of that subsection it seems to me that regard is still to be had to the prejudice occasioned to the practitioner if the extension of time is granted. There must be some prejudice to a practitioner attendant upon the postponement of the resolution of what if anything is owed by his client pursuant to a bill of costs. I take that consideration into account here as one of the circumstances to be weighed, as well as the extent of the delay and the reasons for the delay. 19 I have concluded that having regard to the reasons advanced for the minimal delay that has occurred in this case, and having regard to the explanation put forward for that delay it is just and fair for the plaintiff's assessment to be dealt with and I propose therefore to grant this application. 20 There remains the question of the costs of the application. Mr O'Sullivan submitted that costs should follow the event. Mr Boyce submitted that each party should pay her and its own costs because the plaintiff is seeking an indulgence. 21 Costs are of course in the discretion of the Court: s 98(1) of the Civil Procedure Act 2005. Under r 42.1 of the Uniform Civil Procedure Rules 2005 costs ordinarily follow the event, "unless it appears to the Court that some other order should be made …". 22 Here the plaintiff is seeking an indulgence, having failed to make her application in time. In Holt v Wynter (2000) 49 NSWLR 128 Sheller JA said at [121]: "… In relation to costs, ordinarily a successful applicant, who has allowed him or herself to get out of time, should pay the costs of the application unless the respondents opposition was wholly unreasonable…". 23 However each case must be considered on its own particular circumstances: see the judgment of Priestley JA in Holt v Wynter (supra) at [104]. I do not think it could be said that the defendant's opposition to this application was "wholly unreasonable", but on the other hand the delay was slight and the amount involved is not large. Having reflected on the matter I have concluded that Mr Boyce's submission on costs is to be preferred and that each party should pay her and its own costs.

1. Order that the plaintiff's application for costs assessment pursuant to s 350 of the Legal Profession Act 2004 be dealt with by the costs assessor notwithstanding the expiration of a period of 12 months prior to the making of the application in relation to the items challenged by the plaintiff in the defendant's invoices number 231868 and number 232012.

2. Order that each party pay her and its own costs on the summons. **********

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