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[2025] NSWDC 511
District Court of NSW
2025-12-05
Weber SC DCJ
Original judgment source is linked above.
Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Mavrakis t/as Mavrakis & Associates Lawyers v Malouf [2025] NSWDC 511
5 December 2025
Decision date: 05 December 2025
Jurisdiction: Civil
Before: Weber SC DCJ
Decision: Accordingly, the Court Orders:
(1) that the parties bring in Short Minutes of Order which reflect these reasons.
(2) that the defendant pay the plaintiff’s costs.
Catchwords: COSTS – Appeal from Review Panel – Personal injury damages claim – Whether costs capping provisions apply prior to matter proceeding to judgment resulting in an assessment of costs at nil – Application of LPUL s 178 – Whether non-disclosure results in a costs agreement being void ab initio – Costs agreement continues to apply as a contract – Leave to adduce fresh evidence
Legislation Cited: Civil Procedure Act 2005 (NSW) s 56
Legal Profession Uniform Law (NSW) ss 178, 184
Legal Profession Uniform Law Application Act 2014 (NSW) ss 61, 89, Sch 1 cl 2
Cases Cited: Allesch v Maunz (2000) 203 CLR 172; [2000] HCA 40
Bingham v Bevan (2023) 111 NSWLR 287; [2023] NSWCA 86
Gazecki v McCabes Lawyers Pty Ltd (2020) 102 NSWLR 259; [2020] NSWCA 98
Gilmore Finance Pty Ltd v Aesthete No 3 Pty Ltd [2020] NSWCA 114
McCabe v Riechelmann (No 2) [2023] NSWDC 201
Wills v Woolworths Group Ltd [2022] FCA 1545
Category: Principal judgment
Parties: George Mavrakis t/as Mavrakis & Associates Lawyers (Plaintiff)
Connor Malouf (Defendant)
Representation: Counsel:
Mr J Rogers (Plaintiff)
Ms K Young (Defendant)
Solicitors:
ICL Lawyers (Plaintiff)
S & R Lawyers (Defendant)
File Number(s): 2023/00273933
These proceedings involve the issue of costs payable to the former solicitor for the plaintiff in personal injuries proceedings. The solicitor is the plaintiff and the defendant is the former client. The costs in issue on the plaintiff’s case are $152,801.90. In an open offer, the defendant had indicated it would be happy to resolve the proceedings by payment of $55,000 to the plaintiff solicitor. However, the parties were not able to settle their dispute due to the disproportionate amount of costs which have been expended in fighting about costs.
The plaintiff’s file has been assessed at first instance by a Costs Assessor, determined on 21 October 2022. Then, at the instance of the defendant, it has been the subject of a review by a Costs Review Panel, which was determined on 1 May 2023. The plaintiff, in turn, was not content with the decision of the Review Panel and has appealed to this Court.
The hearing occupied two days and involved a court book of some 588 pages. Written submissions, in total, amounted to approximately 60 pages. It is thus not difficult to understand that the amount spent in pursuing costs came to exceed the amount in issue.
The defendant was initially the plaintiff’s client, in his capacity as tutor for his son. The son was initially required to sue through his tutor as he was a minor at the commencement of proceedings. After he reached his majority, at least for some part of the proceedings, the defendant remained as his son’s tutor. This occurred, as I understand it, because the son had developed a disability requiring that appointment. It seems that, while some part of the period the subject of this litigation was ongoing, the son appeared in his own right; that is to say, without the intervention of a tutor.
I raise this issue as counsel for the defendant flirted with the contention that the defendant may not be the proper party in the proceedings. I indicated to her that, unless she made an equivocal contention that the defendant was not the correct party, or that the proceedings must include the son as a defendant, I would progress to decide the matter on the basis that the proceedings were properly constituted. As no such contention was made, I shall decide the proceedings accordingly.
A useful summary of the chronology of the matter was filed with the initial costs assessment and is available at Court Book (‘CB’) page 16. In short:
The defendant’s son was badly burnt in an accident in April 2017;
The defendant, as tutor for his son, approached the plaintiff for advice shortly thereafter;
The plaintiff provided legal services to the defendant from about May 2017, in particular, in relation to engaging with the responsible party’s insurer, the Police and various medical experts;
The defendant commenced proceedings, in his capacity as tutor for his son, in January 2020, that is, a few months before expiry of the limitation period for personal injury claims.
The plaintiff paid for the costs of the experts retained in the proceedings on behalf of the defendant;
The plaintiff sent invoices for the costs of his disbursements to the defendant throughout the course of the retainer.
Whilst the plaintiff accepted that he had agreed with the defendant not to charge for his professional fees until the conclusion of the matter, it was the plaintiff’s contention that the defendant had agreed to pay the disbursements within a reasonable period of being billed for those costs by the plaintiff. By around May 2021, the defendant had still not paid the plaintiff for the costs of the disbursements. A dispute between the parties arose and the plaintiff terminated his retainer with the defendant.
In or around February 2022, the plaintiff sent a bill of costs to the defendant in the sum of $152,801.90, together with a request for payment.
The defendant did not pay the plaintiff. The plaintiff therefore filed for costs assessment.
The plaintiff sought assessment of its fees in the sum of $152,801.90, which comprised:
Professional fees for the work done from May 2017 to May 2021, in the sum of $80,009.82; and
Disbursements, including the costs of experts and counsel, in the sum of $72,792.08.
As noted in the Assessor’s reasons, the defendant’s new solicitors retained the same counsel, and that counsel agreed not to look to the plaintiff for payment of his earlier invoices, such that these invoices were removed from the assessment. This meant that the costs in dispute on assessment were $111,551.90.
The determination of the Assessor is to be found at CB 175. The Assessor noted that the defendant alleged that there was ‘over-servicing’ and that the bill of costs was ‘generally excessive’. The Assessor took this to mean that the defendant put the whole of the costs in dispute.
The Assessor noted that the plaintiff alleged that, once the contract was validly terminated by either party, the solicitor’s costs became due and payable. The Assessor found that the fees were payable on termination of the contract. He also found that the contract was validly terminated by the plaintiff for non-payment of expenses and that, on termination, the plaintiff’s fees became payable.
The Assessor then undertook a line-by-line assessment of the bill of costs, by reference to the solicitor’s file (being some 11 folders). In the result, he allowed $109,519.80 inclusive of GST, calculated as follows:
Professional fees in the sum of $77,977.02;
Expenses of $1,750; and
Disbursements (not including counsel’s fees) in the sum of $29,792.78.
The Assessor allowed interest on the disbursements paid by the plaintiff, in the sum of $639.22, as well as part of the filing fee (to the amount of $1,115.52). He issued a Form C1 certificate in the total sum of $111,274.54.
The Assessor then came to assessing the costs of assessment (CB 193). He determined that the defendant should be responsible for the costs of the assessment; first, because the plaintiff had been largely successful; and second, because the plaintiff had (prior to the assessment being filed) made an offer to accept less than the amount ultimately assessed. The Assessor issued a certificate of costs payable by the defendant in the sum of $3,856.05 (CB 173).
The defendant subsequently applied for a review of the Assessor’s determination.
In his application for review, the defendant submitted, inter alia, that the Assessor had failed to find that the costs agreement was a conditional one, and that the Assessor had not properly assessed the plaintiff’s fair and reasonable costs (CB 169). Before the Panel, the defendant also raised, for the first time, the issue of the costs capping regime which applies to personal injury litigation pursuant to cl 2 of Sch 1 of the Legal Profession Uniform Law Application Act 2014 (NSW) (‘LPULAA’) (CB 170). Relevantly, s 61 of the LPULAA provides that maximum costs provisions relating to personal injury damages matters are contained in Sch 1.
The Panel then engaged in correspondence with the parties, which correspondence included the topic of the costs capping regime.
The Review Panel ultimately determined that:
Because of the existence of s 61 of the LPULAA, and the fact that the matter had yet to proceed to judgment, the professional fees of the plaintiff should be assessed at nil (CB 275).
The costs agreement was void, presumably ab initio, although, for reasons to which I shall return, the relevance of this determination is not clear.
It ‘would have reduced’ the assessed costs, in any event, on the grounds identified.
‘[I]f the Panel was required to assess the professional costs, it would have assessed them in the order of $55,000 including GST’.
It otherwise agreed with the Assessor’s determination as to disbursements, but it reduced $109.15 of postage.
As to the costs of the assessment, the Panel:
(a) Reversed the determination of the Assessor and determined that the costs of assessment ought be paid by the plaintiff. (b) Determined that the plaintiff ought be responsible for the costs of the Review Panel.
89 Appeal on matters of law and fact
(1) A party to a costs assessment that has been the subject of a review under this Part may appeal against a decision of the review panel concerned to—
(a) the District Court, in accordance with the rules of the District Court, but only with the leave of the Court if the amount of costs in dispute is less than $25,000, or
…
(2) The District Court or the Supreme Court (as the case requires) has all the functions of the review panel.
…
(4) An appeal is to be by way of a rehearing, and fresh evidence or evidence in addition to or in substitution for the evidence before the review panel or costs assessor may, with the leave of the Court, be given on the appeal.
42. Sixthly, the court is not given specific powers, but rather is said to have “all the functions of the review panel.” The effect of this provision is by no means clear. The functions of the review panel are set out in s 85 of the Application Act [LPULAA], and involve reviewing “the determination of a costs assessor”: s 85(1). For that purpose, the review panel has “all the functions of a costs assessor … and is to determine the application … in the manner that a costs assessor would be required to determine an application for costs assessment”: s 85(2). The review panel is not bound by the rules of evidence and may inform itself on any matter in the manner it thinks fit: s 85(3). There is a degree of awkwardness in conferring on a court required to determine an appeal against a decision of a review panel all the functions of the review panel, which involve review of the decision of a costs assessor. That language may affect what is meant in s 89(4) by an appeal “by way of a rehearing”.
43. No submissions were made in this Court on the scope and operation of s 89; accordingly, it is both unnecessary and inappropriate for the Court to resolve these questions in this case. What is clear, however, is that courts exercising jurisdiction under this provision must pay close attention to the terms of the statutory power and should not adopt statements from earlier cases dealing with different powers, unless persuaded that they remain applicable. Although the distinction between appeals on matters of law and appeals from the final determination of a costs assessment have been removed, it may, nevertheless, be appropriate to adopt different standards of scrutiny with respect to each. Thus, questions of law are inherently liable to review according to a correctness standard; a lower standard of scrutiny may well be applicable to an assessment of what costs are fair and reasonable in the circumstances of the particular case. Particularly is that so where a specific body of costs assessors, appointed solely for that function, reach evaluative judgments. Furthermore, costs assessors are expected to ensure consistency of approach, being a standard which cannot readily be applied by a reviewing court with limited experience of such matters.
(Emphasis added)
For present purposes, the critical difference between an appeal by way of rehearing and a hearing de novo is that, in the former case, the powers of the appellate court are exercisable only where the appellant can demonstrate that, having regard to all the evidence now before the appellate court, the order that is the subject of the appeal is the result of some legal, factual or discretionary error, whereas, in the latter case, those powers may be exercised regardless of error. At least that is so unless, in the case of an appeal by way of rehearing, there is some statutory provision which indicates that the powers may be exercised whether or not there was error at first instance. And the critical distinction, for present purposes, between an appeal by way of rehearing and an appeal in the strict sense is that, unless the matter is remitted for rehearing, a court hearing an appeal in the strict sense can only give the decision which should have been given at first instance whereas, on an appeal by way of rehearing, an appellate court can substitute its own decision based on the facts and the law as they then stand.
(Emphasis added)
The grounds of appeal as advanced in the Amended Summons commencing the appeal were more extensive than those which were finally advanced by the plaintiff in final submissions. At the final hearing, the following were the plaintiff’s contentions on the appeal:
The Review Panel erred in determining that the failure to contract out of the costs capping regime in circumstances where the claim had not produced a judgment meant that the professional costs ought to be nil;
If that is wrong, the plaintiff should be granted leave to rely on fresh evidence of the judgment in the underlying proceedings;
The Review Panel erred in finding that the costs agreement was void ab initio (if that is what it found).
The assessment of the Review Panel did not accord with the statutory requirements where adequate reasons were not given, thus it is not possible to ascertain how the Panel arrived at the figure it did.
I shall deal with the matter by reference to the plaintiff’s submissions in relation to these topics, though it may be that it is unnecessary to decide all of them.
The Review Panel erred in finding that there was noncompliance by the Plaintiff with section 174 of the Legal Profession Uniform Law, where:
(a) at the time that the defendant provided initial instructions to the plaintiff, the injuries of the defendant had only recently been sustained and it was reasonable at that time for further instructions to be sought before providing a costs disclosure;
(b) it is evident on the record, in any event, that the plaintiff was only instructed to pursue a claim for the defendant on or around August 2017;
(c) in those circumstances, it was reasonable for the plaintiff to provide a disclosure in October 2017;
(d) further, it was reasonable for the estimate provided at the time not to account for prospective legal proceedings where:
i. the extent of the defendant’s injuries had still not yet been ascertained; and
ii. the parties were pursuing the prospect of a settlement with the party that the defendant said was responsible for his injuries.
(e) the plaintiff provided an estimate of the total costs up to the conclusion of a hearing on 11 February 2020, which was shortly after proceedings were commenced;
(f) in the premises, that was as soon as reasonably practicable where the record reveals that the defendant only instructed the plaintiff to retain counsel and prepare a statement of claim for filing in around November 2019, the claim was filed in January 2020 and the limitation period for the claim expired in March 2020.
The Review Panel found that the plaintiff failed to contract out of the costs capping regime contained in Sch 1 to the LPULAA. At the time of the review, the underlying litigation had yet to be resolved. As a consequence of this fact, the Review Panel assessed the plaintiff’s costs as nil.
In my view, this approach is clearly erroneous.
I take this view for the following reasons:
Clause 2 of Sch 1 ‘fixes’ costs where the amount recovered in personal injury litigation does not exceed $100,000. Clause 2, in my view, has no work to do until the amount recovered has been determined (see McCabe v Riechelmann (No 2) [2023] NSWDC 201). It follows that, until the proceedings were determined so as to allow the determination of the ‘amount recovered’, it was wrong for the Panel to conclude that the solicitor’s costs should be assessed as nil.
The Panel dealt with the matter in the following manner (at [5.42]-[5.43]):
It is not for the Review Panel to speculate as to the possible outcome of the proceedings. There are no guarantees of success in litigation.
The Review Panel considers that at the time Mr Mavrakis filed the application for assessment, in the circumstances, where he failed to contract out of Schedule 1 costs, he had not [sic] entitlement to costs as the amount of these will depend on the outcome of the proceedings. In the circumstances the Review Panel considers that the Costs Assessor erred in determining the fair and reasonable amount of costs due to Mr Mavrakis.
It was certainly the case that there had been no determination of the proceedings, however, in my view, it was not for the Panel to, in reality, apply the costs capping provisions when the outcome of the proceedings was not known. Whether the appropriate course for the Panel to adopt was to stand over the review pending resolution of the underlying litigation is not something which I need to consider in this appeal.
Accordingly, in my view, there should have been no issue concerning ‘contracting out’ of the costs capping provisions as those provisions had yet to have an opportunity to arise.
The defendant argued that the plaintiff’s costs agreement was void and, as such, the decision of the Review Panel to determine the plaintiff’s costs as nil was correct. It was said that the costs agreement was void reliant upon what were alleged to be various types of non-disclosure by the plaintiff’s solicitor. I do not accept the defendant’s argument. I consider that the argument fails to deal with the consequences of non-disclosure pursuant to s 178 of the Legal Profession Uniform Law (NSW) (‘LPUL’). Section 178(1)(a) certainly says that a non-disclosure results in the costs agreement the subject of the assessment being void.
It also should be noted, however, that when s 178 specifies that a costs agreement is void, such statutory effect does not render the costs agreement void ab initio. Rather, the section only takes effect from the date of the contravention.
This was made clear by the Federal Court in Wills v Woolworths Group Ltd [2022] FCA 1545, where the Court stated:
[28] But importantly, the proper construction of ss 174(1)(b) and 178(1)(a) indicates that a failure to comply with the disclosure obligation under s 174(1)(b), which necessarily is an obligation which arises after initial instructions are given and an initial disclosure is made pursuant to s 174(1)(a), will result in the costs agreement concerned being void in terms of its operation in futuro rather than ab initio. So where a law practice fails to provide an updated estimate of total legal costs “as soon as practicable after there is any significant change” to the estimate of total legal costs previously disclosed to the client, the costs agreement between the law practice and the client is only void from the date of the contravention, rather than from the date of commencement of the costs agreement. To suggest the latter would be absurd and is not consistent with the text when read in context and with the relevant statutory purpose sought to be achieved.
[29] First, s 178(1)(a) uses the present tense “is void” rather than “is and was at all times from inception void”.
[30] Second, if the legislature intended the latter, it would likely have had a claw back for all legal costs previously paid by the client from the date of inception. But there is no such claw back; contrast this with s 185(2). Indeed, s 178(1)(c) only speaks about present or future recovery of legal costs which by definition have not yet been paid. Likewise, s 178(1)(b) only speaks to legal costs not yet paid.
[31] Third, it is implausible to suggest that a valid costs agreement say running for 2 years with legal costs happily being paid thereunder should suddenly become void ab initio merely because at the 2 years mark there was a deficiency in a disclosure of a forward estimate of costs from that 2 years mark. Such a consequence would be disproportionate. Further, it would be against the s 169(a) objective. If a disclosure is deficient at the 2 years mark, the proportionate response is to void the costs agreement at that time in terms of going forward as the deficient disclosure would have denied the client an informed choice going forward from that 2 years mark. But it makes no sense to void the agreement ab initio. If the legislature intended such an unnecessarily penalising outcome, it should have expressly made this clear.
(Emphasis added)
178 Non-compliance with disclosure obligations
(1) If a law practice contravenes the disclosure obligations of this Part—
(a) the costs agreement concerned (if any) is void; and
(b) the client or an associated third party payer is not required to pay the legal costs until they have been assessed or any costs dispute has been determined by the designated local regulatory authority; and
(c) the law practice must not commence or maintain proceedings for the recovery of any or all of the legal costs until they have been assessed or any costs dispute has been determined by the designated local regulatory authority or under jurisdictional legislation; and
(d) the contravention is capable of constituting unsatisfactory professional conduct or professional misconduct on the part of any principal of the law practice or any legal practitioner associate or foreign lawyer associate involved in the contravention.
…
As I have earlier indicated, the meaning of the word ‘void’ when used in s 178(1)(a) of the LPUL is more limited than its usual legal usage. This was considered by the Court of Appeal in Bingham v Bevan (2023) 111 NSWLR 287; [2023] NSWCA 86 at [40]-[49]. In that appeal, the Court held that ‘the word “void” is not used in the Uniform Law to indicate some absolute absence of legal effect’ (at [41] per Basten AJA, Meagher and White JJA agreeing). Accordingly, the avoidance of the costs agreement pursuant to s 178(1)(a) does not mean that the terms of the costs agreement did not continue to apply. Thus, the avoidance is relevant only for the purposes of the LPUL. The avoidance of the costs agreement pursuant to s 178(1)(a) is not relevant to the general principles of contract (LPUL s 184).
When it is understood that any non-disclosure does not result in the contract between solicitor and client becoming void ab initio then, its clauses continue to apply as a contract. Importantly for present circumstances, the costs agreement contained a clause permitting the solicitor to determine the retainer if the client failed to pay disbursements. This occurred, and the solicitor determined the costs agreement. He was thereafter entitled to be paid his fees. This occurred before the costs capping provisions of the legislation could have applied.
This was made clear by the Court in Bingham, where at [45]-[46] the Court stated:
- These provisions invite a purposive approach to the understanding of the consequence of a contravention of the disclosure obligations. As stated in Pt 4.3, Div 1 of the Uniform Law (Introduction) Pt 4.3 has three specific objectives identified as follows:
169 Objectives
The objectives of this Part are—
(a) to ensure that clients of law practices are able to make informed choices about their legal options and the costs associated with pursuing those options; and
(b) to provide that law practices must not charge more than fair and reasonable amounts for legal costs; and
(c) to provide a framework for assessment of legal costs.
46. It is evident that the purpose of the disclosure obligations is to ensure that the client of a law practice is able to make an informed choice about available legal options and the costs associated with them. That purpose or objective is promoted by avoiding a costs agreement based on inadequate disclosure. However, it is not advanced by avoiding provisions in a costs agreement which, favourably to the client, determine when and in what circumstances costs are payable. The purpose is also not advanced by avoiding a costs agreement which requires that charges be made at a rate below that which would otherwise be identified as fair and reasonable. The latter issue does not arise in the present case, but, significantly for present purposes, the effect of inadequate disclosure is not to terminate the retainer, but to allow that the services may yet be provided (or have been provided) on the basis that the practitioner can only recover fair and reasonable costs for those services. (It is possible that a client might have other relief available in circumstances where a substantial underestimation of the likely costs of a proposed course led to the client adopting a course which would not otherwise have been pursued.)
(Emphasis added)
Section 178, far from establishing the defendant’s case, is in fact, in my view, fatal to the defendant’s contentions.
It follows from s 178(1)(b) that non-disclosure does not to lead to the conclusion that the solicitor is not entitled to any costs. Rather, non-compliance with the disclosure obligations simply requires the legal practitioner to have their costs assessed before they can be recoverable in an appropriate court. This is previously what happened in this case.
Thus, in my view, a matter of non-disclosure has no role to play at a cost assessment beyond its role in leading to a conclusion that, by dint of the non-disclosure, the presumption that the fees are reasonable is lost. This loss of the presumption leads to a requirement for the legal practitioners to undertake a costs assessment before they can seek to recover the fees concerned. To my mind, it would be unsatisfactorily circuitous for the issue of non-disclosure to be raised at the very costs assessment which the non-disclosure required.
In the present case, the Assessor considered a very limited argument on non-disclosure and determined the issue in the plaintiff’s favour. I agree with the Assessor’s conclusion in that regard. The Assessor then went on to undertake a line-by-line assessment. The defendant argued for a much wider case of non-disclosure before the Review Panel. I do not consider that this was an appropriate course, for reasons which I have articulated. These non-disclosures are irrelevant to the plaintiff’s costs when they have been assessed.
Pursuant to s 89(4) of the LPULAA, the Court retains a discretion to admit fresh evidence on the appeal.
The evidence sought to be adduced was a consent judgment which resolved the underlying proceedings in the sum of $600,000 plus $200,000 on account of costs (CB 202).
The application for leave was not vigorously opposed, and I had little hesitation in granting the leave sought. Indeed, in my view, the decision to grant leave was an obvious one, as to allow this case to be conducted on the basis that costs capping provisions applied when, in reality, the plaintiff achieved a settlement six times greater than the statutory cap would be to adopt a course which would bring the law into disrepute.
As such, in my view, as a result of the grant of leave, s 61 of the LPULAA has no relevance to the assessment of the plaintiff’s costs. This was the basis upon which the Costs Assessor assessed costs.
As a result of these conclusions, I consider it is unnecessary for me to decide various other issues which were raised on the appeal.
To do otherwise, in my view, would be to act contrary to the provisions of s 56 of the C**ivil P**rocedure A**ct 2005 (NSW).
As, in my opinion, I consider the Review Panel’s determination cannot stand, I shall make orders setting it aside.
I am conscious of the benefits which costs assessors enjoy over the Court in matters of costs assessment which were described by Basten JA in Gazecki v McCabes L**awyers Pty Ltd at [43], which have been extracted earlier in these reasons.
Accordingly, I consider the appropriate order to be to determine the proceedings as one reinstating the certificate for determination of costs assessment, which certificate was produced on 21 October 2022.
Costs should follow the event, which costs should include the costs of the proceedings before the Review Panel.
Accordingly, the Court Orders:
that the parties bring in Short Minutes of Order which reflect these reasons.
that the defendant pay the plaintiff’s costs.
**********
Amendments at [2] and [36] as requested by the plaintiff's solicitor.
Mavrakis t/as Mavrakis & Associates Lawyers
Malouf [2025] NSWDC 511
(2000) 203 CLR 172
(2023) 111 NSWLR 287
(2020) 102 NSWLR 259