NA & J Investments Pty Ltd v Minister Administering the Water Management Act 2000

Back to top Judgment 1Hutchins Pastoral Company Pty Ltd, Danwillach Pty Ltd and Delta Creek Pty Ltd (the Applicants) have filed a Notice of Motion dated 27 November 2009 seeking various costs orders against Taylor & Whitty Pty Ltd (T&W), the First Respondent on the Notice of Motion; Mr John Taylor, the Second Respondent on the Notice of Motion; and Mr Peter King, the Third Respondent on the Notice of Motion. The Minister administering the Water Management Act 2000 (the WM Act) is not a party to the Notice of Motion. The Applicants are no longer parties in the substantive proceedings having discontinued on 6 November 2009. The name of the lead applicant in the substantive proceedings was changed to NA & J Investments Pty Ltd by consent orders dated 21 May 2010. The substantive proceedings are continuing with approximately 40 named applicants. 2Mr Taylor and T&W are the principal of the firm and the firm of solicitors which acted previously for the Applicants in the substantive proceedings. Mr King is the barrister who formerly represented the Applicants in the ongoing substantive proceedings. The Applicants seek various orders including that their costs of the proceedings in which they are no longer parties and the costs of discontinuing from the proceedings (including the Crown's costs awarded at the time of the discontinuance) are payable by the Respondents. 3Costs are sought pursuant to s 99 of the Civil Procedure Act 2005 (the CP Act) which provides: (1) This section applies if it appears to the court that costs have been incurred: (a) by the serious neglect, serious incompetence or serious misconduct of a legal practitioner, or (b) improperly, or without reasonable cause, in circumstances for which a legal practitioner is responsible. (2) After giving the legal practitioner a reasonable opportunity to be heard, the court may do any one or more of the following: (a) it may, by order, disallow the whole or any part of the costs in the proceedings: (i) in the case of a barrister, as between the barrister and the instructing solicitor, or as between the barrister and the client, as the case requires, or (ii) in the case of a solicitor, as between the solicitor and the client, (b) it may, by order, direct the legal practitioner: (i) in the case of a barrister, to pay to the instructing solicitor or client, or both, the whole or any part of any costs that the instructing solicitor or client, or both, have been ordered to pay to any other person, whether or not the solicitor or client has paid those costs, or (ii) in the case of a solicitor, to pay to the client the whole or any part of any costs that the client has been ordered to pay to any other person, whether or not the client has paid those costs, (c) it may, by order, direct the legal practitioner to indemnify any party (other than the client) against costs payable by that party. ... (5) The court may give ancillary directions to give full effect to an order under this section, including directions to a legal practitioner to provide a bill of costs in assessable form: (a) to the court, or (b) to a party to the proceedings, or (c) in the case of a barrister, to the instructing solicitor or client, or both, or (d) in the case of a solicitor, to the client. ... (7) In this section, client includes former client. 4Costs are sought under s 99(1)(a) for serious neglect or serious incompetence. Serious misconduct is not alleged. Section 56 of the CP Act is relevant to the consideration of s 99 and stated at the time of the hearing: (1) The overriding purpose of this Act and of rules of court, in their application to civil proceedings, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings. (2) The court must seek to give effect to the overriding purpose when it exercises any power given to it by this Act or by rules of court and when it interprets any provision of this Act or of any such rule. (3) A party to civil proceedings is under a duty to assist the court to further the overriding purpose and, to that effect, to participate in the processes of the court and to comply with directions and orders of the court. (4) A solicitor or barrister must not, by his or her conduct, cause his or her client to be put in breach of the duty identified in subsection (3). (5) The court may take into account any failure to comply with subsection (3) or (4) in exercising a discretion with respect to costs. 5Since the hearing s 56 has been amended ( Courts and Crimes Legislation Further Amendment Act 2010 commenced 1 April 2011). The amendments do not relevantly alter s 56 for the purposes of this case.

Particulars 6A letter from solicitors dated 19 March 2010 outlining the particulars of the Applicants' claims was sent and stated as follows: Particulars of allegations against Taylor & Whitty Pty Ltd and Mr John Taylor The allegations of serious neglect, serious incompetence of a legal practitioner within the meaning of s 99(1)(a) of the Civil Procedure Act 2005 (NSW) ("the CPA ") against Taylor & Whitty Pty Ltd and Mr John Taylor are as follows: Commencing proceedings in a manner inconsistent with instructions

1. Mr Taylor and/or Taylor & Whitty commenced proceedings in the Hutchins Applicant's names in a manner contrary to the Hutchins Applicants' instructions. (1) In December 2006, Mr Stewart Hutchins, a director of the Hutchins Companies, approached Mr Taylor of Taylor & Whitty in relation to a dispute with the NSW Department of Natural Resources as to whether the Department had correctly calculated the Hutchins Companies' water entitlements under Rule 10 rather than Rule 1 of the "History of Extraction Rules" in Appendix 4 of the Water Sharing Plan for the Lower Murrumbidgee Groundwater Sources 2003 (NSW) made under the Water Management Act 2000 (NSW) - Rule 10 applied to properties that had been amalgamated and the Hutchins Applicants contended that their properties had not been "amalgamated" within the meaning of Rule 10 ("the Amalgamation Claim "). Mr Hutchins gave instructions to Mr Taylor that Taylor & Whitty should: (a) advise in relation to the merits of the Amalgamation Claim; (b) act on behalf of the Hutchins Companies in relation to the Amalgamation Claim. (2) On 22 December 2006, an unknown officer or agent of Taylor & Whitty commenced proceeding number 42192 of 2006 in the NSW Land and Environment Court ("the LEC ") in the name of the Hutchins Applicants as joint applicants with two unrelated parties, Cummins [sic] Partnership Pty Ltd and NA & J Investments Pty Ltd ("the LEC Proceedings"). The proceeding was commenced by filing a Class 4 Application, which was signed by the unknown officer or agent of Taylor & Whitty. The Class 4 Application sought remedies in relation to a challenge to the validity of the Water Management Act and the Water Sharing Plan ("the Validity Claims") but did not seek remedies in relation to the Hutchins Applicants' Amalgamation Claim. (3) The Hutchins Applicants did not give instructions for proceedings to be commenced jointly with Cummins [sic] Partnership Pty Ltd and NA & J Investments Pty Ltd. (4) The Hutchins Applicants did not give instructions for proceedings to be commenced which did not include the Amalgamation Claim. (5) The Hutchins Applicants did not give instructions for proceedings to be commenced in relation to the Validity Claims. The above conduct constitutes serious neglect and/or serious incompetence of a legal practitioner within the meaning of s 99(1)(a) of the CPA. The conduct caused the Hutchins Applicants to incur the following costs: for the commencement of an action they had not authorised; for the Hutchins Applicant's attempt to extricate themselves from the LEC Proceeding through the Notice of Motion filed 24 August 2009; and the necessity for the Hutchins Applicants to pay the Respondents costs of the LEC Proceedings to 24 August 2009 as ordered on 6 November 2009 as a condition of the Hutchins Applicants discontinuing the LEC Proceedings and recommencing the Amalgamation Claim as a separate proceeding. Joining further parties and causes of action to the proceedings
2. Mr Taylor and/or Taylor & Whitty joined to the LEC Proceedings further parties with further causes of action in a manner that delayed the determination of the Amalgamation Claim and resulted in greater delays and expense in finalising the Amalgamation Claim. (1) Taylor & Whitty knew or ought to have known that: (a) the Validity Claims were complex, would take some time and would be costly to prepare and argue; (b) the addition of further applicants to the proceeding would add further costs and add to the time it would take to finalise the matter; (c) the Amalgamation Claim was relatively simple and, on its own, could have been dealt far more swiftly than the Validity Claims; (d) the longer the resolution of the Amalgamation Claim was delayed, the more the Hutchins Applicants would suffer in terms of lost water. (2) Taylor & Whitty never advised the Hutchins Applicants of the above matters. (3) The directors of the Hutchins Applicants repeatedly asked Mr Taylor and other officers of Taylor & Whitty questions regarding: (a) whether their Amalgamation Claim was being "lost" in the Validity Claims; and (b) whether the Validity Claims were not inconsistent with their Amalgamation Claim. The directors cannot recall the dates of every occasion on which the above questions were asked, but among them were the following: (i) On 16 May 2007, at a directions hearing in the LEC Proceedings, Mr Hutchins asked Mr King (who was there briefed by Taylor & Whitty) how the Hutchins Companies' Amalgamation Claim would fit with the other claims brought in the action. Mr Hutchins said words to the effect of: "How do you represent the other parties who want the Water Sharing Plan overturned and us where our case depends on the Water Sharing Plan being held to be valid, in the one case?" In response, Mr King assured Mr Hutchins that the Hutchins Applicants' dispute with the Department of Natural Resources would be "pursued and heard individually, but within the one case." (ii) On an unknown number of occasions between 16 May 2007 and the mediation conducted in or about September 2007, Mr Hutchins informed Mr Taylor and Mr Nathan Archibald, a solicitor then employed by Taylor & Whitty, that he was concerned that the Hutchins Companies' dispute with the Department regarding their water allocation should not be included with the other cases and parties in the LEC Proceeding. (iii) During the mediation in September 2007, Mr Hutchins asked Mr Nathan Archibald an employed Solicitor of Taylor & Whitty on at least two occasions, when the Hutchins amalgamation claim was going to be discussed at the mediation. Mr Archibald informed Mr Hutchins that his amalgamation claim would be discussed "shortly". (iv) At the conclusion of the mediation in September 2007, Mr Hutchins asked Mr Nathan Archibald, why his dispute with the Department had not been discussed and expressed concerns that it was being lost in the other issues in the LEC Proceeding. Mr Hutchins raised similar concerns with Mr Taylor some time later at the offices of Taylor & Whitty in Finley. He was told it was "discussed behind closed doors" but was never given any details. (v) On 26 June 2008, Mr Hutchins had a telephone conversation with an unknown officer of Taylor & Whitty in which he expressed his concern that his specific causes of action were being "lost". (vi) On 29 November 2007, Mrs Jenny Hutchins (a director of the Hutchins Companies) attended a meeting of the applicants and solicitors in the LEC Proceeding at Finley. Mrs Hutchins raised the Hutchins Applicants concern that further applicants should not be added to the proceeding because the Hutchins Applicants were not concerned with the Validity Claims but were involved in the LEC Proceedings on the issue of their Amalgamation Claim. (vii) On 30 November 2007, Mr Hutchins had a lengthy telephone conversation with Mr Dale Brooks, an employed solicitor of Taylor & Whitty, in which Mr Hutchins objected to more parties being joined to the LEC Proceeding. (viii) Some time in December 2007, Mr Hutchins expressed his concern to Mr Taylor that adding more parties to the LEC Proceeding would complicate and delay the proceeding. (4) Taylor & Whitty joined in the LEC Proceedings various other applicants, in relation to the Validity Claims as well as other claims relating specifically to those new applicants. In particular: (a) As particularised at sub-para 1(2) above, when the LEC Proceeding was commenced, the following applicants were named in addition to the Hutchins Applicants: (i) Cummins [sic] Partnership Pty Ltd; and (ii) NA & J Investments Pty Ltd. (b) On 20 April 2007, Taylor & Whitty caused to be filed a Further Amended Application in the LEC Proceedings that joined the following further applicants (the same document appears to have been filed again on 23 April 2007): (i) Vittorio Rossato; (ii) Ursula Narelle Rossato; (iii) Stephen Leslie Huggins; and (iv) Carol Margaret Huggins. (c) On 14 December 2007 Taylor & Whitty filed a Further Amended Application adding the following further applicants to the LEC Proceedings: (i) Robert Dennis Adams; (ii) Milton Robert Alexander; (iii) Bartter Enterprises Pty Limited; (iv) Vittore Michaele Belatto; (v) Deana Elizabeth Belatto; (vi) Anita Maree Hogan; (vii) Scott Elizabeth Hogan; (viii) WG & PE Booth; (ix) Glenda Lorraine Brill; (x) Andrew Malcolm Browning; (xi) Catherine Elizabeth Browning; (xii) Ian Harvey Clark; (xiii) RWG & KE Foster; (xiv) Antonio Galluzzo; (xv) Rita Elma Galluzzo; (xvi) Judith Elizabeth Graham; (xvii) Neville Patrick Heath; (xviii) Debra Jayne Heath; (xix) James William Hermiston; (xx) Jan Elizabeth Hermiston; (xxi) Glen Alexander McKersie; (xxii) RL & HL Rollinson; (xxiii) Rex Gordon Schultz; (xxiv) Selesian Downs Pty Ltd; (xxv) Geoffrey Julian Walsh; (xxvi) Pamela Dorothy Walsh; (xxvii) Alastair Ross Wells; and (xxviii) Woodpark Pastoral Company Pty Ltd. (d) On 24 April 2008, Taylor & Whitty caused to be filed a Further Amended Application that added the following applicants to the LEC Proceeding: (i) Ray Hawke; (ii) Scott Hogan; (iii) Anita Hogan; (iv) Phillip Ronald Johnson; (v) RJ & PR Porter; (vi) AM & RL Rollinson; (vii) Robert A Scellato; and (viii) JA & VA Stephens. The above conduct constitutes serious neglect and/or serious incompetence of a legal practitioner within the meaning of s 99(1)(a) the CPA. The conduct delayed the finalisation of the Hutchins Applicants' Amalgamation Claim. The conduct caused the Hutchins Applicants to incur the following costs: costs associated with preparing the Validity Claims; costs associated with adding these parties to the LEC Proceeding; costs associated with the Hutchins Applicant's attempt to extricate themselves from the LEC Proceeding through the Notice of Motion filed 24 August 2009; and the necessity for the Hutchins Applicants to pay the Respondents costs of the LEC Proceedings to 24 August 2009 as ordered on 6 November 2009 as a condition of the Hutchins Applicants discontinuing the LEC Proceedings and recommencing the Amalgamation Claim as a separate proceeding. Incompetent pleadings
3. [Not pressed] Neglecting the conduct of the Amalgamation Claim in favour of the Validity Claims
4. Mr Taylor and/or Taylor & Whitty neglected the conduct of the Hutchins Applicants' Amalgamation Claim in favour of the Validity Claims. In particular: (1) [Not pressed] (2) [Not pressed] (3) There was no consideration nor advise [sic] given as to what effect the joining of additional parties in the LEC Proceeding would have on the prosecution of the Hutchins Applicants Amalgamation Claim nor on whether the proceedings should be split such that the Amalgamation Claim could progress while the Validity Claims were adjourned awaiting the outcome of other cases raising similar issues in the NSW Court of Appeal and in the High Court of Australia. ...
5. The above neglect delayed the determination of the Amalgamation Claim. The Hutchins Applicants incurred unnecessary costs in terms of: (1) preparing the Validity Claims; and (2) the necessity for the Hutchins Applicants to pay the Respondents costs of the LEC Proceedings to 24 August 2009 as ordered on 6 November 2009 as a condition of the Hutchins Applicants discontinuing the LEC Proceedings and recommencing the Amalgamation Claim as a separate proceeding. The above constitutes serious neglect and/or serious incompetence of a legal practitioner within the meaning of s 99(1)(a) the CPA. Continuing to assert a retainer after it had been terminated
6. Officers of Taylor & Witty continued to assert to the NSW Crown Solicitors Office ("the CSO"), being the solicitors for the Respondents in the LEC Proceedings ("the Crown Respondents"), that Taylor & Whitty continued to act for the Hutchins Applicants after Taylor & Whitty knew, or ought reasonably to have known, that its retainer had been terminated. (1) On 4 April 2008, Mr Hutchins wrote to Mr Taylor expressing his "frustration and disappointment" with Taylor & Whitty's services and foreshadowing that the Hutchins Companies intended to engage new lawyers and were considering leaving the LEC Proceedings. (2) The Hutchins Applicants terminated Taylor & Whitty's retainer by a letter of their new solicitors, Kell Moore Pty Ltd, dated 11 December 2008. (3) On 8 September 2009, Kell Moore again wrote to Taylor & Whitty re-iterating that the Hutchins Companies had terminated Taylor & Whitty's retainer in December 2008 and informing them that: "[T]o the extent that you still consider that you are retained to act on behalf of the Hutchins Companies in these proceedings (which in our view was not the case as of December 2008), we on behalf of the Hutchins Companies now formally terminate that retainer." (4) In correspondence and conversations with officers of the CSO after both these dates, Taylor & Whitty either asserted that they continued to hold a retainer for the Hutchins Applicants or did not disabuse the CSO of the notion that Taylor & Whitty still held a retainer on behalf of the Hutchins Applicants. In particular: (a) On 11 February 2009 in an email from Mr Josh Wolf of Taylor & Whitty to Ms Rebecca Kiu of the CSO (in response to a letter from Ms Kiu to Mr Wolf of 3 February 2009), Mr Wolf gave the Hutchins Applicants' consent to certain consent orders being made without indicating that Taylor & Whitty no longer acted for the Hutchins Applicants and were simply passing on instructions from Kell Moore. (b) On 25 September 2009 in a telephone conversation between Mr Taylor of Taylor & Whitty and Dr David Galbraith of the CSO, in which Mr Taylor did not inform Dr Galbraith that Taylor no longer held a retainer for the Hutchins Applicants in the context of Mr Taylor and Dr Galbraith discussing the propriety of Kell Moore having filed an appearance in the LEC Proceedings on behalf of the Hutchins Applicants on 26 August 2009. (c) On 29 September 2009 in a telephone conversation between Mr Wolf of Taylor & Whitty and Dr Galbraith of the CSO, Mr Wolf said words to the effect that, while he expected that in due course Taylor & Whitty's retainer to act for the Hutchins Companies would be terminated, it had not been terminated as yet. (5) Taylor & Whitty's assertion to the CSO that it still acted for the Hutchins Applicants, and the CSO's consequent confusion as to who was properly acting for the Hutchins Applicants, delayed the Crown Respondents' decision to grant the undertaking that was eventually given and upon which the Hutchins Applicants were given leave to discontinue their involvement in the LEC Proceedings. (a) [not pressed] (b) The Crown Respondents did not give the desired undertaking until 6 November 2009 (see order 3 made on that day). (6) The Crown Respondents' delay in providing the undertaking made it necessary for the Hutchins Applicants to prosecute the Notice of Motion filed 24 August 2009 in an effort to resolve the resulting impasse. The Hutchins Applicants incurred costs as a result, including their own costs of the motion and the obligation to pay the Crown Respondents' costs of the motion pursuant to order 6 made on 6 November 2009 (but note orders 7 and 8 also made on that day). The above conduct constitutes serious neglect and/or serious incompetence of a legal practitioner within the meaning of s 99(1)(a) the CPA. Failing to co-operate with the Hutchins Applicants' new lawyers
7. Taylor & Whitty refused to co-operate with the Hutchins Applicants' new lawyers, Kell Moore: (1) Taylor & Whitty refused to provide Kell Moore with a copy of their file in the matter in circumstances where Taylor & Whitty asserted that the Hutchins Applicants owed them fees but refused to render them an invoice, or even an estimate, for those fees. In particular reference is made to: (a) On 19 August 2009 Kell Moore wrote to Taylor & Whitty seeking access to Taylor & Whitty's file for the LEC Proceedings. (b) On 31 August 2009 Kell Moore wrote to Taylor & Whitty seeking access to Taylor & Whitty's file for the LEC Proceedings and indicating that Kell Moore understood that the Hutchins Applicants did not owe any fees to Taylor & Whitty. (c) On 22 October 2009 Kell Moore wrote to Taylor & Whitty seeking clarification as to whether the Hutchins Applicants owed any fees to Taylor & Whitty and seeking access to Taylor & Whitty's file for the LEC Proceeding. (d) On 23 October 2009 Taylor & Whitty wrote to Kell Moore indicating that fees were still owing and promising to render an invoice in the next 14 days. (e) On 5 November 2009 Kell Moore wrote to Taylor & Whitty seeking an invoice and or access to Taylor & Whitty's file of the LEC Proceeding. (f) 13 November 2009 Kell Moore wrote to Taylor & Whitty again seeking an invoice and or access to Taylor & Whitty's file of the LEC Proceeding; (g) On 16 November 2009, Taylor & Whitty to Kell Moore saying they were in the process of completing a final account of costs and disbursements and that they would not release the file until that account was paid; (h) Kell Moore is yet to receive an invoice or final account of costs and disbursements from Taylor & Whitty. (2) Taylor and Whitty refused to authorise Kell Moore to inspect the court file. (a) Kell Moore first requested Taylor & Whitty's permission to inspect the Court file in the LEC Proceeding by letter erroneously dated "17 March 2009" but sent on 17 August 2009. (b) The matter was discussed between Mr Taylor and Mr Williams of Kell Moore on 17 August 2009. (c) Kell Moore sent a further request by letter on 19 August 2009. (d) Kell Moore sent a further request by letter on 8 Septmeber2009. (e) Taylor & Whitty gave Kell Moore the requested authority on 11 September 2009. The above conduct constitutes serious neglect, serious incompetence of a legal practitioner within the meaning of s 99(1)(a) the CPA. The conduct caused Kell Moore to have an incomplete understanding of the LEC Proceedings. This resulted in inaccuracies in the affidavits of Andrew Williams sworn 21 and 31 August 2009 supporting the Notice of Motion referred to sub-para 6(6) above and also meant that some of the orders sought in that motion were inappropriate. As a result, the matter was delayed while the motion and affidavits were corrected and the Hutchins Companies incurred further costs associated with preparing the Amended Notice of Motion filed 23 October 2009 and the affidavit of Andrew Williams sworn 27 November 2009 in support of it. Particulars of allegations against Mr King The allegations of serious neglect, serious incompetence of a legal practitioner within the meaning of s 99(1)(a) of the CPA against Mr King are as follows (defined terms are the same as for the Taylor and Whitty particulars above). Failing to advise that the Hutchins Applicants' Amalgamation Claim be litigated separately
8. Mr King failed to advise Taylor & Whitty or the Hutchins Applicants to separate the Amalgamation Claim from the Validity Claims so that the Hutchins Applicants Amalgamation Claim could be run separately and not await the Validity Claims. (1) Mr King knew or ought to have known the matters that it said Taylor & Whitty knew or ought to have known in sub-para 2(1) of the Taylor & Whitty particulars above. (2) Mr King never advised Taylor & Whitty or the Hutchins Applicants of the above matter particularised in sub-para (1) above, despite the directors of the Hutchins Applicants having directly asked him questions regarding: (a) whether their Amalgamation Claim was being "lost" in the Validity Claims; and (b) whether the Validity Claims were not inconsistent with their Amalgamation Claim. The directors cannot recall the dates of every occasion on which the above questions were asked of Mr King, but among them is the communication particularised at sub-para 2(3)(i) of the Taylor & Whitty particulars above. (3) Taylor & Whitty joined in the LEC Proceedings number 42192 various other applicants, in relation to various other claims, as particularised in sub-para 2(4) of the Taylor & Whitty particulars above. Mr King did not advise against this course or advise of its negative consequences upon the Hutchins Applicants' as particularised in sub-para (1) above. Indeed, by letter to Taylor & Whitty of 4 December 2007, Mr King expressed the view that "I consider the addition of new parties to be a positive development, as it shows support for the case regarding the challenge to the WSP". The above constitutes serious neglect and/or serious incompetence of a legal practitioner within the meaning of s 99(1)(a) the CPA. The conduct delayed the finalisation of the Hutchins Applicants' Amalgamation Claim. The conduct delayed the finalisation of the Hutchins Applicants' Amalgamation Claim. The conduct caused the Hutchins Applicants to incur the following costs: costs associated with preparing the Validity Claims; costs associated with adding these parties to the LEC Proceeding; costs associated with the Hutchins Applicant's attempt to extricate themselves from the LEC Proceeding through the Notice of Motion filed 24 August 2009; and the necessity for the Hutchins Applicants to pay the Respondents costs of the LEC Proceedings to 24 August 2009 as ordered on 6 November 2009 as a condition of the Hutchins Applicants discontinuing the LEC Proceedings and recommencing the Amalgamation Claim as a separate proceedings. Incompetent pleadings
9. [Not pressed] Neglecting the conduct of the Amalgamation Claim in favour of the Validity Claims
10. Mr King neglected the conduct of the Hutchins Applicants' Amalgamation Claim in favour of the Validity Claims in the same manner as particularised against Taylor & Whitty in para 4 of the Taylor & Whitty particulars above. This conduct delayed the determination of the Amalgamation Claim. The Hutchins Applicants incurred unnecessary costs in terms of: (1) preparing the Validity Claims; and (2) the necessity for the Hutchins Applicants to pay the Respondents costs of the LEC Proceedings to 24 August 2009 as ordered on 6 November 2009 as a condition of the Hutchins Applicants discontinuing the LEC Proceedings and recommencing the Amalgamation Claim as a separate proceedings. The conduct constitutes serious neglect and/or serious incompetence of a legal practitioner within the meaning of s 99(1)(a) the CPA. 7Particulars as alleged against T&W and Mr Taylor will be referred to as T&W Part and particulars as alleged against Mr King will be referred to as King Part. The Applicants' counsel stated in closing submissions that T&W Part 4(1) and (2) were not pressed as a result of rulings on evidence made in the course of the proceedings concerning privilege over what occurred during mediation proceedings. Consequently these are not set out. T&W Part 4 was reduced to a single particular and was submitted to be part of Part 1. King Part 3 relies in turn on T&W Part 4. The same consideration applies to King Part 3, which can be considered part of King Part 1.

Evidence 8Extensive affidavit and oral evidence was given in the hearing. In the course of the hearing I made numerous rulings on whether affidavit and oral evidence could be admitted due to claims of legal professional privilege and confidentiality of mediation proceedings. My rulings were generally to uphold claims of legal professional privilege and confidentiality of mediation proceedings so that much of the affidavit material filed could not be relied upon. An agreed chronology as between T&W and Mr Taylor and the Applicants was provided and follows, slightly modified. Mr King did not object to it being handed up and treated as an aide memoir. Not all the disputed matters identified in the chronology are particularised or raised by the Applicants' nine issues of disputed fact identified below in the summary of evidence and elaborated on in the Applicants' submissions (see par 74 - 94 below). Other litigation which the Applicants were or are involved in apart from the substantive proceedings include Porter v Minister for Natural Resources (06/41290) and native vegetation proceedings in the Supreme Court. Porter , commenced 22 December 2006 and discontinued 16 May 2007, related to challenges to the Water Sharing Plan for the Lower Murrumbidgee Groundwater Sources 2003 (the Plan). I mention these in order for the events in the chronology to be understood. Arnold v Minister Administering the Water Management Act (07/40049) and Harvey v Minister Administering the Water Management Act 2000; Tubbo Pty Ltd v Minister Administering the Water Management Act 2000 [ 2008] NSWLEC 165 ; (2008) 160 LGERA 50) are also referred to in other evidence. Date Event 28 February 1997 Applicants purchase 17 properties. For rating (but not title) purposes, the lots are divided into three parcels, one owned by each company. Before 1 January 2000 Hutchins Pastoral Company, Danwillach and Delta Creek (the Applicants) granted bore licences 50BL198153, 50BL198157 and 50BL198156 respectively, under the Water Act 1912 . June 1999 Applicants approach the Department of Natural Resources (the Department) to combine their water rights. September 1999 Department refuses the Applicants' request. 2000 Applicants again request to combine their water rights. 23 April 2001 Department links the Applicant's licences such that water could be extracted from any of them up to a single total figure. December 2005 Mr Archibald commences work for T&W. 27 February 2006 Mr Hutchins writes to the Department regarding the way in which it planned to convert the Applicants' water rights into rights under the WM Act. 9 May 2006 Hutchins write to the Department regarding the way in which it planned to convert the Applicants' water rights into rights under the WM Act. Late 2006 Applicants engage Pike Pike & Fenwick regarding Porter (a planned attempt to overturn the Plan). 8 September 2006 Hutchins write to the Department regarding the way in which it planned to convert the Applicants' water rights into rights under the WM Act. 1 October 2006 WM Act commences with respect to the Applicants' water rights. The Plan (as amended) commences. Applicants granted a single water access licence. October 2006 Applicants engage Mr MacFarlane of Matthews & Dangar regarding the way in which the Department converted their water rights into rights under the WM Act. October -November 2006 Exchange of correspondence between Matthews & Dangar and the NSW government regarding the way in which the Department had converted the Applicants' water rights into rights under the WM Act. 3 October 2006 Mr MacFarlane writes to the Department regarding the way in which it had converted the Applicants' water rights into rights under the WM Act. 9 November 2006 Mr MacFarlane writes to the Department seeking a response to his letter of 3 October regarding the way in which it had converted the Applicants' water rights into rights under the WM Act. November 2006 Mr Taylor claims this is when the Hutchins first approached him. ( Disputed by Mr Hutchins. The contents of any conversation are also disputed .) 28 November 2006 Mr MacFarlane writes to the Department seeking a response to his letter of 3 October regarding the way in which it had converted the Applicants' water rights into rights under the WM Act. 30 November 2006 Department replies to Mr MacFarlane. November / December 2006 Mr MacFarlane retires from practice. Mr Stanford recommends T&W. 5 December 2006 Hutchins meet T&W. ( Dispute as to what issues the Hutchins were interested in. Dispute as to the contents of the conversations that occurred.) Hutchins compose a facsimile attaching material regarding the Applicants' water rights to T&W. Mr Hutchins meets with Mr Taylor shortly afterwards. 6 December 2006 T&W receives faxed material. 18 December 2006 Hutchins fax further material. regarding the Applicants' water rights. On or about 18 December 2006 Mr Taylor has discussions with Mr Hutchins. 19 or 20 December 2006 Mr Rossato contacts Mr Taylor. 19 December 2006 Mr Taylor consults Mr Taylor SC regarding application. Mr Taylor drafts an application to be filed in Court. 19 December 2006 Mr Taylor telephones Mr Hutchins and asks him for a cheque for a filing fee. 20 December 2006 The Hutchins drive to Finley to give a cheque for $1400 for filing fee. 20 December 2006 Mr Taylor tells Mr Archibald in Sydney to prepare to file applications. On or about 20 December 2006 Mr Commins has a conversation with Mr Hutchins regarding T&W's involvement in water cases and Porter . 20 or 22 December 2006 and after Mr Taylor receives instructions from Mr Commins. 20-22 December 2006 Mr Archibald and Mr Taylor confer regarding the applications. 20-22 December 2006 Mr Commins gives T&W $1318 as a filing fee for an application. After 20 December 2006 Mrs Huggins and Mr Thompson contact T&W and give instructions. Before or on 22 December 2006 Mr Taylor has telephone conversation with Mr Hutchins. Dispute as to what was said. 22 December 2006 T&W files a Class 4 application in the names of the Applicants, Commins Partnership and NA & J Investments and another in the names of the Rossatos and Huggins. Early 2007 Mr Taylor allocates the matter to Mr Archibald. Mr Archibald takes instructions from the Hutchins and other applicants. Early March 2007 Mr Hutchins has discussions with Mr Rossato regarding his case. 9 March 2007 Hutchins and Mr Rossato meet with Mr Taylor and Mr Archibald at the offices of T&W. 13 March 2007 T&W writes to the Applicants suggesting they get an opinion from Mr King and enclose a fee agreement. Hutchins agree sometime soon after. 16 March 2007 T&W files an amended application. 16 March 2007 Pike Pike & Fenwick's submission to the Ombudsman. 22 March 2007 T&W briefs Mr King. 27 March 2007 Mrs Huggins corresponds with the Hutchins and others regarding the Porter Ombudsman submission. 31 March 2007 T&W receives an opinion from Mr King. 5 April 2007 Mr Hutchins receives a letter from T&W enclosing their instructions to Mr King and his opinion. On or about 5 April 2007 Mr Hutchins receives an invitation from T&W to attend a conference with Mr King in Sydney on or about 13 April 2007. Sometime in April 2007 T&W instructs Mr King to draft Points of Claim (POC). Dispute over whether this occurred before or after the conference on 13 April 2007 13 April 2007 Conference between Mr Archibald, Mr King and Mr Hutchins in Sydney. Dispute over what was said and done at the conference. 20 April 2007 T&W files a further amended Class 4 application. The Rossatos and Huggins added as applicants. 20 April 2007 Short minutes filed pursuant to which the Rossato proceedings ( 06/41293) is discontinued and the applicants in that proceedings are added as co-applicants to the substantive proceedings. Directions hearing. Mr and Mrs Hutchins not present. 23 April 2007 T&W files a copy of the further amended application. 23 April 2007 T&W files POC dated 20 April 2007. 2 May 2007 Mr Hutchins receives email from T&W with a copy of the POC. Shortly after 7 May 2007 T&W receives a letter from the Crown Solicitor's Office (CSO) requesting particulars. T&W instruct Mr King to draft a response. 14 May 2007 Hutchins receive advice from Mr Robertson SC in Porter that it has little prospect of success. They give instructions to discontinue it. 16 May 2007 Directions hearing. Mr King appears for applicants in several proceedings relating to the WM Act including in the substantive proceedings. Porter discontinued. The Hutchins attend but Mr Taylor and Mr Archibald do not. The Hutchins have a conversation with Mr King afterwards, the contents of which are disputed . 16 May 2007 T&W sends the Applicants a costs agreement regarding substantive proceedings, as well as an invoice for services rendered so far. 16 May 2007 T&W sends particulars to the CSO. After 16 May 2007 Mr Taylor claims he had a number of discussions with Mr Hutchins and others about the addition of former applicants in Porter as new applicants in the present proceedings. Mr Hutchins does not recall any such conversations. Between 16 May and 1 September 2007 Mr Hutchins claims he, on a number of occasions, expresses concerns to Mr Taylor and Mr Archibald regarding whether the Hutchins Companies' amalgamation claim was being "lost" in the validity claims. Disputed. 18 May 2007 Meeting of the applicants at Finley attended by Mr Hutchins, Mr Taylor, Mr Archibald, Mr King and others. May-September 2007 Preparation for mediation. 24 May 2007 Mr Archibald receives an email from Mrs Huggins. 29 May 2007 Meeting at Colembally Bowling Club. 30 July 2007 Directions hearing. Mr Archibald attends. Mediation ordered for 10 and 11 September 2007. 10 August 2007 T&W sends report to clients. 30 August 2007 Meeting at Coleambally Bowling Club. 1 September 2007 Mr Hutchins gives Mr Archibald a document estimating his losses. 1 September 2007 Mr Hutchins sends Mr Archibald a letter setting out "our water situation". 3 September 2007 T&W engage Booth Associates Pty Ltd. 5, 7 & 13 September 2007 Booth Associates sends report (the Booth report) on the Applicants' losses to Mr Hutchins and Mr Archibald. 10-11 September 2007 Mediation. 12 September 2007 Conference with Mr King. Dispute over what was said. 18 September 2007 T&W receives letter from the CSO regarding alleged problems with the pleadings and particulars (no complaint made about the pleadings of the amalgamation claim). 30 August 2007 Meeting at Coleambally Bowling Club. October 2007 Mr Archibald hands the matter over to Mr Brooks within T&W. 10 October 2007 T&W sends report to clients. 12 October 2007 T&W sends memo of fees to the Applicants. November 2007 Mr Taylor instructs Mr Brooks to brief Mr Priestley. 26 November 2007 T&W sends email to all five clients including the Applicants. 29 November 2007 T&W holds a meeting at Finley for current and proposed applicants. Mr Hutchins did not attend but Mrs Hutchins did. New applicants discussed. Dispute about Mrs Hutchins' words at the meeting. Dispute over what was said by representatives of T&W. 29 November 2007 Hutchins receive a copy of a brief to Mr Priestley. Dispute over whether it had already been sent to Mr Priestley or whether it was a draft. 30 November 2007 Mr Hutchins telephones Mr Brooks. Dispute as to contents of the conversation. 30 November 2007 T&W files amended POC. December 2007 Mr Archibald ceases work for T&W. 4 December 2007 Mrs Hutchins writes to T&W with comments on instructions to Mr Priestley. 6 December 2007 T&W files an amended POC. 10 December 2007 Mr Hutchins receives a report from Mr King. 14 December 2007 T&W files a further amended application. 17 December 2007 Meeting at Coleambally Bowling Club. December 2007 to April 2008 Hutchins assist T&W prepare the matter for hearing (then set down to be heard in May 2008). 27 or 28 February 2008 Mr Taylor meets with Mr Hutchins and some or all of the other applicants to discuss how costs would be split. Dispute : Mr Taylor says the meeting occurred on 28 February; Mr Hutchins says it occurred on 27 February. 13 March 2008 Mr Hutchins receives a report from Mr King. 17 March 2008 Ms Bickerton of T&W emails draft affidavit to Mr Hutchins. 18 March 2008 Mr Hutchins swears an affidavit. 26 March 2008 Directions hearing in the native vegetation proceedings. 27 March 2008 Mr Hutchins forwards to Mr Taylor and Mr King correspondence from his accountant regarding the Department's calculation of the Applicants water rights. 3 April 2008 Mr Hutchins meets with Mr Williams of Kell Moore to discuss T&W's conduct of the proceedings. 5 April 2008 Hutchins write to T&W (letter dated 4 April 2008) expressing their "frustration and disappointment" with the management of the case. 7 April 2008 Mr Taylor has telephone conversation with Mr Hutchins. 7 April 2008 Mr Hutchins receives a report from T&W concerning advice from Mr King regarding the native vegetation proceedings. 7 April 2008 Applicants retain Kell Moore to advise in relation to T&W's conduct of the proceedings. On or just after 7 April 2008 Mr Hutchins has a telephone conversation with Mr Taylor regarding his dissatisfaction with T&W's work. 10 April 2008 Mr Taylor receives Hutchins letter dated 4 April 2008. 11 April 2008 Mr Hutchins emails Mr Taylor regarding his concerns. 12 April 2008 T&W files an amended POC and a further amended application pursuant to leave given by Jagot J on 3 April 2008 18 April 2008 Mr Hutchins receives a report from Mr King to Mr Taylor regarding directions hearing of 26 March 2008 in the native vegetation proceedings. 22 April 2008 Mr Hutchins emails Mr Taylor and Mr King regarding his concerns with his cases. 24 April 2008 T&W files a further amended application and POC. More applicants added. 30 April 2008 Mr Priestley's opinion delivered. 1 May 2008 Mr Hutchins receives an email from Mr King regarding the substantive proceedings and the native vegetation proceedings. 12 May 2008 Mr Hutchins emails Mr King regarding his dissatisfaction and the issue of the way in which the Department had converted the Applicants' water rights. 18 June 2008 Harvey and Tubbo decisions handed down by Jagot J. 25 June 2008 Mr Hutchins telephones Mr Williams seeking advice regarding the Harvey and Tubbo decisions. 25 June 2008 (or shortly after) T&W sends memorandum of fees to the Hutchins. 26 June 2008 Mr Hutchins calls Mr Taylor expressing concerns. 30 June 2008 Mr Williams telephones Mr Taylor regarding Kell Moore's involvement. Requests documents. 4 July 2008 Mr Williams writes to T&W. Mr Taylor telephones Mr Williams. 6 July 2008 Mr Taylor claims there was a telephone conversation between him and Mr Williams. Mr Williams denies this. 11 July 2008 Telephone conversation between Mr Taylor and Mr Williams. 15 July 2008 Mr Williams writes to Mr Taylor seeking additional information. 15 July 2008 Telephone conversation between Mr Taylor and Mr Williams. 16 July 2008 Kell Moore receives a bundle of FOI documents from Mr Hutchins, which includes a copy of the Class 4 application. 17 July 2008 (or thereabouts) Applicants retain Kell Moore to act for them in the native vegetation proceedings. 18 July 2008 Mr Williams writes to Mr Taylor seeking copies of all pleadings since 22 December 2006 and states he is in receipt of the "Class 4 Application". 21 July 2008 Mr Williams has a telephone conversation with Mr Taylor about provision of pleadings. Mr Taylor provides most recent pleadings. 23 July 2008 Mr Williams receives documents from T&W, which he is told is the current pleading in the substantive proceedings. Mr Williams gives the Hutchins some preliminary advice shortly afterwards. 25 July 2008 Mr Taylor SC applies to vacate hearing. 31 July 2008 (or shortly after) Mr Hutchins forwards a report from T&W to Kell Moore. 1 August 2008 Mr Williams has a telephone conversation with Mr Taylor. 22 August 2008 Applicants give authority for T&W to give the native vegetation file to Kell Moore. 26 August 2008 T&W receives Applicants' authority. 16 September 2008 Kell Moore receives T&W's native vegetation file. 17 September 2008 T&W files a second further amended application and a second further amended further POC. 29 October 2008 Mr Hutchins receives a report from T&W. December 2008 Mr Hutchins says he instructs Kell Moore to terminate T&W's retainer in the substantive proceedings and to act for the Applicants. 11 December 2008 Kell Moore writes to T&W. ( Dispute over whether this was in fact a termination of retainer.) 11 December 2008 Mr Taylor has a telephone conversation with Mr Williams regarding the Hutchins leaving the substantive proceeding. On or about 11 December 2008 Mr Williams contacts Mr King. 17 December 2008 Mr Hutchins writes to Mr King informing him of the Applicants' intention to leave the substantive proceeding. Mr King replies. Sometime in 2008 Mr Wolff commences at T&W and works on the Hutchins matter. 23 January 2009 Kell Moore writes to CSO about the Applicants' future involvement in the substantive case. 3 February 2009 Mr Wolff receives a letter from the CSO seeking clarification whether T&W's consent earlier given to certain consent orders was on behalf of all the applicants. 4 February 2009 Mr Williams has a telephone conversation with Mr Taylor. Mr Williams tells Mr Taylor, among other things, that he would seek the Applicants' instructions regarding the foreshadowed adjournment of the substantive proceedings. Mr Williams asks for a history of the proceedings. 4 February 2009 CSO replies to Kell Moore and Mr Williams has a telephone conversation with the CSO's Ms Kiu. 5 February 2009 CSO writes to Kell Moore. 11 February 2009 Mr Williams has a telephone conversation with Mr Taylor giving the Applicants' consent to the proposed adjournment. Discusses the Applicants' future involvement in the case. 11 February 2009 Mr Wolff writes to Ms Kiu giving consent to certain orders on behalf of all applicants, including the Applicants. 12 February 2009 Mr Williams writes to Mr Taylor confirming consent to the proposed adjournment. Addresses the future involvement of the Applicants in the case. 20 February 2009 Kell Moore writes to CSO enclosing draft statement of claim. 3 March 2009 CSO writes to Kell Moore requesting the final statement of claim. 17 April 2009 Kell Moore writes to the CSO enclosing a finalised statement of claim and requesting certain undertakings. 17 April-23 June 2009 Mr Williams makes several phone calls to the CSO seeking a response to his correspondence of 17 April 2009. 12 May 2009 (AM) Mr Williams has a telephone conversation with Mr Taylor regarding the substantive proceedings being adjourned to October 2009 and costs issues. 14 May 2009 Mr Wolff speaks to Mr Williams regarding the substantive proceedings being adjourned to October 2009. 23 June 2009 Mr Williams speaks with an officer of the CSO who informs Mr Williams that they were still seeking instructions. 23 June 2009 Kell Moore receives correspondence from CSO indicating that the CSO was still seeking instructions on its response to Kell Moore's letter of 17 April 2009. 17 July 2009 Mr Williams telephones the CSO seeking a response to Kell Moore's letter of 17 April 2009. 13 August 2009 Mr Williams telephones the CSO seeking a response to Kell Moore's letter of 17 April 2009. 17 August 2009 Kell Moore writes to T&W seeking their authority to view the Court file. 17 August 2009 Mr Taylor calls Mr Williams about getting advice from counsel. 17 August 2009 Mr Williams has a telephone conversation with Mr Taylor regarding Kell Moore's request for an authority to view the Court file. Shortly after 17 August 2009 Mr Taylor seeks advice from Mr King regarding the Applicants' access to the Court file. 19 August 2009 Mr Taylor calls Mr Williams to let him know he is waiting for counsel's advice regarding access to the Court file. 19 August 2009 Kell Moore writes to T&W regarding Kell Moore's request for authority to view the Court file. 19 August 2009 Mr Taylor calls Mr Williams about being in Canberra next week. 21 August 2009 Mr Williams signs misjoinder motion and swears affidavit in support. 24 August 2009 Kell Moore files the misjoinder motion and an appearance as solicitors for the Applicants. On or shortly after 25 August 2009 Mr Taylor becomes aware of the misjoinder motion and the appearance. He is still awaiting Mr King's advice regarding access to the Court file. 31 August 2009 Kell Moore receives correspondence from T&W. Kell Moore replies. 2 September 2009 Directions hearing on the misjoinder motion. 8 September 2009 Kell Moore writes to T&W reiterating that their retainer had been terminated in December 2008 and formally terminating any retainer T&W might consider it still had. 8 September 2009 Kell Moore writes a letter to T&W, on a "without prejudice save as to costs" basis regarding access to the Court file. 8 September 2009 Kell Moore makes further request for access to the Court file. Shortly before 11 September 2009 T&W receives Mr King's advice regarding Kell Moore having access to the Court file. 11 September 2009 T&W gives Kell Moore authority to view the Court file. 23 September 2009 Kell Moore receives a letter from the CSO regarding the notice of appearance and authorisation to act on behalf of the Applicants. 25 September 2009 Mr Taylor has a telephone conversation with Dr Galbraith of the CSO regarding Kell Moore having filed an appearance. 28 September 2009 Kell Moore replies to the CSO's letter of 23 September 2009 regarding who acted for the Applicants. Copied to T&W. 28 September 2009 Kell Moore inspects the Court file. (approx.) 29 September 2009 Kell Moore writes to the CSO indicating that, having gained access to the Court file, Kell Moore now realised that the misjoinder motion was based on a false premise and that there would be a need for amendments to the motion. 29 September 2009 Mr Wolff has a telephone conversation with Dr Galbraith. Dispute over what was said. 2 October 2009 Directions hearing. Applicants given leave to file an amended misjoinder motion. 21 October 2009 Kell Moore writes to the CSO requesting certain undertakings and explaining the proposed amended misjoinder motion. 22 October 2009 CSO replies to Kell Moore's letter of 21 October 2009. 22 October 2009 Kell Moore writes to T&W requesting access to their client file. 23 October 2009 Directions hearing. Amended misjoinder motion filed in Court. Matter stood over for two weeks to give the CSO time to decide whether it would grant the undertakings requested by Kell Moore. 23 October 2009 Kell Moore receives correspondence from T&W about outstanding costs. 4 November 2009 CSO writes to Kell Moore offering a form of undertaking. 5 November 2009 Kell Moore writes to the CSO and T&W regarding costs issues. 6 November 2009 Directions hearing. Misjoinder motion dismissed by consent. Undertaking given by the Crown. Applicants discontinue from the proceedings. Applicants ordered to pay Crown's costs, but not until any wasted costs motion against T&W had been dealt with. 19 November 2009 Kell Moore files proceedings in the Supreme Court regarding the way in which the Department calculated Applicants' water rights.

Evidence for the Applicants 9The following affidavits were read by the Applicants: three affidavits of Mr Hutchins, a director of the Applicants, dated 28 April 2010 (in chief), 21 October 2010 (in chief) and 8 October 2010 (in reply); two affidavits of Mrs Hutchins, also a director of the Applicants, dated 28 April 2010 (in chief) and 8 October 2010 (in reply); and three affidavits of Mr Williams, solicitor for the Applicants, dated 27 November 2009 (in chief), 30 April 2010 (in chief) and 12 October 2010 (in reply to affidavits of Mr Taylor and Mr Wolff). All were also cross-examined, often at length. 10Events referred in these affidavits are contained in the chronology and do not therefore need to be summarised in that regard. The chronology identifies those areas where there is a factual dispute as between the parties. As will become clear in my findings later in the judgment I do not consider I need to resolve all the issues of fact raised by the Applicants and consequently it is not necessary that I summarise all of the extensive written and oral evidence presented. I will set out some of the cross-examination although it plays a limited role in my determination.

Mr Hutchins 11Mr Hutchins' affidavit dated 28 April 2010 identifies the land, bore licences and water access licences held by the Applicants and the nature of the amalgamation claim. In relation to the engagement of T&W he rang Mr Taylor on 5 December 2006 and faxed 18 pages of material to T&W, exhibited to the affidavit except for some missing pages. He met with Mr Taylor shortly afterwards and sets out the conversation he believes occurred at that meeting. Further material was faxed to T&W. He recalled some discussion about the validity of the Plan. His evidence about what was said at the meeting was otherwise given orally. He states that he did not give instructions to commence proceedings on behalf of the Applicants as joint applicants with any other parties or in relation to any challenge to the validity of the Plan or the WM Act. He gave T&W a cheque of $1400 in December 2006 which was a filing fee to commence the substantive proceedings. 12Mr Hutchins refers to a telephone call with Mr Brooks on 30 November 2007 in which he states he complained about the joinder of additional parties. 13Mr Hutchins states that he did not receive a copy of the Class 4 application filed on behalf of the Applicants and only saw this when Kell Moore obtained access to the Court file in September 2009. His affidavit refers to obtaining advice jointly with the Rossatos in March 2007, discontinuing Porter in May 2007, attending a directions hearing on 16 May 2007, preparation for mediation in September 2007, not agreeing to the joinder of further parties in November 2007 and his decision to approach Kell Moore. He made statements on numerous occasions to Mr Taylor and Mr Archibald that he was concerned that his amalgamation claim was being lost in the proceedings and that he did not want to challenge the validity of the Plan. 14The affidavit dated 21 October 2010 states that he was not advised that the amalgamation claim was relatively simple and could be dealt with more swiftly than the validity claims, and that the longer the resolution of the amalgamation claim the more the Applicants would suffer loss of water. The affidavit in reply dated 8 October 2010 disputes a number of statements made in affidavits of Mr Archibald, Mr Brooks and Mr Taylor relied on by T&W and Mr Taylor. He responds to Mr King's affidavit about the conference on 13 April 2007 and denies that draft POC were provided to him at that meeting. He also disputes that there was discussion about pursuing a validity claim. He disputes there was a reference in the meeting to his football skills. 15Mr Hutchins was cross-examined by counsel for T&W and Mr Taylor about the Applicants' involvement in Porter . Counsel pointed out that par 16 of Mr Hutchins' affidavit dated 28 April 2010 imparted a conversation between himself and Mr Taylor in which Mr Hutchins indicates that he was involved in Porter . Although Mr Hutchins did not believe that Pike Pike & Fenwick joined them as Applicants to those proceedings without instructions, he states that their objective in being part of Porter was to have the amalgamation issue heard, not to overturn the Plan. In May 2007, the Applicants discontinued those proceedings after receiving advice from Mr Robertson SC that they did not enjoy reasonable prospects of success in overturning the Plan. Mr Hutchins conceded that had they received favourable advice, the Applicants would have continued the claim. 16When asked about his meeting with Mr Taylor in December 2006, Mr Hutchins did not remember expressing concern that Porter would not go ahead and said that at that time he did not want the Plan overturned. He admitted discussing Arnold . He recalled Mr Taylor telling him that he was looking at all avenues to challenge the government's decision as to the reduction of ground water entitlements, that the application needed to be filed urgently and that there was insufficient time to obtain advice from counsel. Mr Hutchins insisted that he did not want to keep his options open; he was not interested in the validity arguments and only wanted to have the amalgamation issue heard. Mr Hutchins admitted discussing the validity issues with officers of T&W, including Mr Taylor and Mr Archibald, in accordance with his affidavit in reply. He also admitted discussing them with Mr King on 13 April 2007. When it was suggested that after discontinuing Porter the Hutchins were interested in overturning the Plan, Mr Hutchins denied this. 17With regard to the joinder of other applicants, in cross-examination Mr Hutchins said that he discussed the Hutchins' approach to T&W with Mr Rossato, Mrs Huggins and Mr Commins. In cross-examination it was suggested that Mr Hutchins did not complain to Mr Brooks on 30 September 2007 but that he was pleased with the addition of other parties. Mr Hutchins disagreed. Counsel for T&W and Mr Taylor also put to Mr Hutchins that at the end of 2007, Mr Hutchins was keen to have extra people added to the case so that the costs might be spread more thinly. Mr Hutchins replied that he was concerned about getting an indemnity from the new applicants so that costs from T&W and the Crown might be shared. It was suggested to Mr Hutchins that he did not express concern about the way the case was being conducted until April 2008 and even then, in the letter they wrote to the T&W of their frustrations dated 4 April 2008, the Hutchins did not complain about the additional applicants or the inclusion of the validity arguments. Mr Hutchins agreed. The letter from Kell Moore to T&W dated 4 July 2008 (exhibit 4) sent on behalf of the Applicants does not mention any complaint about the validity issues or of being part of a group of applicants. Counsel suggested that the letter accurately reflected the view of the Hutchins in July 2008. Mr Hutchins agreed. 18In cross-examination by Mr King's counsel, Mr Hutchins accepted that when he was asked a question that he could not give an honest answer to, he would say "our claim was only the amalgamation claim". When asked whether Mr Hutchins could identify the part of the pleading that concerned the amalgamation claim and whether he could understand it, he replied in the affirmative. Referring to Mr Hutchins' affidavit in reply at par 6A, counsel asked Mr Hutchins to clarify which parts of the Points of Claim (POC) he thought were "hardly intelligible" but Mr Hutchins was unable to do so as he could not remember and did not know. 19In relation to what occurred at the conference on 13 April 2007 (issue 4), Mr King's counsel directed Mr Hutchins to his affidavit of 28 April 2010, in which Mr Hutchins does not mention the meeting with Mr King on 13 April 2007. Mr Hutchins said he did not forget about the meeting at the time he swore this affidavit but chose not to include it because he did not think it was a "big deal" as it was a brief discussion which concerned only the amalgamation claim. He said that Mr King thought the best thing to do was to fight their case on a broader basis than Porter . Mr Hutchins disputed suggestions by counsel that Mr King told him there were several claims common to all actions and that it was clear there would be a group of people including the Applicants who would pursue the validity claims. The meeting is referred to in Mr Hutchins' affidavit in reply but he does not disclose that the validity claims were discussed. 20When asked about the directions hearing on 16 May 2007 (issue 5) and other parties such as Mr Commins, Mr Thompson, Mrs Huggins and Mr Rossato, Mr Hutchins understood at that time that they were concerned with either amalgamation or reliance issues but not with the validity of the Plan. 21In re-examination Mr Hutchins was asked about his level of education given his statement in chief that his selection of words is not very good at times, the topic of validity claims was common topic of conversation generally in the local area and what he meant in relation to some words in the letter of complaint dated April 2008, inter alia.

Mrs Hutchins 22Mrs Hutchins' first affidavit was largely directed to confirming what was said in Mr Hutchins' affidavits as she was present at many of the meetings he referred to and heard many of the telephone calls attested to. Mrs Hutchins attended a meeting at Finley with Mr Brooks on 29 November 2007 and other potential parties where she says she did not agree to the joinder of additional parties. She disputed Mr Brooks' evidence of what was said at that meeting. She overheard the telephone call between Mr Hutchins and Mr Brooks the following day, 30 November 2007 and confirmed Mr Hutchins' recollection of that conversation.

Mrs Huggins 23The Applicants also read an affidavit of Mrs Huggins, dated 25 October 2010. Mrs Huggins states she and her husband, Mr Huggins, are parties to the substantive proceedings in this Court. She is aware that Hutchins Pastoral Company was also involved in the proceedings but has now ceased to be a party. Annexed to her affidavit is a copy of the original Class 4 application filed on 22 December 2006 (06/41293) identifying Mr and Mrs Huggins and the Rossatos as the applicants in those separate proceedings. Replying to an affidavit of Mr Taylor, Mrs Huggins states she was referred to T&W by Mr Commins regarding water allocation issues. In December 2006 she made contact with an officer of that firm indicating that she and her husband "wished to be involved in any proceedings relating to seeking to redress, water or compensation for losses". She states that she was aware of others, including that "the Hutchins family and a few other businesses severely affected by the water policy change process had also asked T&W to act on their behalf". Replying to an affidavit of Mr Archibald, Mrs Huggins recalls that she received an email invitation to meet Mr King and others on 13 April 2007 "to discuss the claim which was common to us". She states she does not recall being informed that Mr Hutchins and another had also been invited to a meeting with Mr King in Sydney on the same day. She recalls that although Mr and Mrs Hutchins attended a collective meeting at another time for wide ranging discussions, they did not fully participate as they left the meeting early. Replying to an affidavit of Mr King, Mrs Huggins recalls that "after the formal part of the mediation, Mr Hutchins repeatedly expressed concern about the fact that no negotiations were taking place in respect of his amalgamation claim."

Mr Commins 24The Applicant also read an affidavit of Mr Commins dated 5 August 2010. Mr Commins is a director of Commins Partnership Pty Ltd, a party in the substantive proceedings. Mr Commins provides a brief summary of his company's participation in Porter . He states that on or about 20 December 2006 he spoke with Mr Hutchins and was told that T&W was "running a case for the Murray Ground Water Irrigators (otherwise known as the Arnold case)". Mr Commins states that he made preliminary enquiries directly to T&W about commencing class action litigation, but did not discuss any of this with Mr Hutchins. Mr Commins recalls that there was a deadline by which any issues concerning the Plan had to be filed of 22 December 2006. Mr Commins paid a filing fee of $1318 to T&W. He understood the filing fee related to an action to be instituted by T&W on behalf of Commins Partnership Pty Ltd and two other parties who were not the Applicants. 25In reply to an affidavit of Mr Taylor, Mr Commins states that he was not contacted by Mr Hutchins "and asked by him to join the action that he was proposing to commence with Taylor & Whitty". Mr Commins disagrees (with the statements in Mr Taylor's affidavit) that Mr Taylor telephoned him to discuss the Court applications before they were commenced. Mr Commins understood the points of claim relating to his multi-party proceedings which he did not understand would include the Applicants were in relation to challenging the validity of the Plan. He also understood that the proceedings commenced by T&W on behalf of the Applicants and others related to amalgamation claims which were combined with proceedings (also issued by T&W) for other parties which included challenging the validity of the Plan. Mr Commins understood "that the initial proceedings that had been instituted by Taylor & Whitty were related just to the reliance issue and that following the advice of Mr Peter King, they were subsequently expanded to include issues relating to the validity of the water sharing plan".

Dr Galbraith 26Dr Galbraith gave oral evidence. He is a senior solicitor employed by the Crown Solicitor's Office (CSO) since May or June 1995. The CSO was instructed soon after six or seven matters were commenced in late 2006 and early 2007 challenging the validity of the amendments to water sharing plans made under the WM Act, including the substantive proceedings. Dr Galbraith was the senior solicitor on these matters until April or May 2010. 27Dr Galbraith's initial knowledge of Kell Moore's involvement in the matter was when he received a letter dated 23 January 2009. He understood their involvement in the substantive proceedings was to advise the Applicants in respect of what appeared to be a dispute between the Applicants and T&W who were the solicitors on record for all the applicants at that time. Dr Galbraith did not recall when he first started communicating with T&W about Kell Moore's involvement. He recalled the conversation with Mr Taylor of 25 September 2009 and that he called T&W because they had not filed affidavits according to directions. He had made a file note of that conversation. Dr Galbraith also recalls a conversation with Mr Wolff on 29 November 2009 which he initiated because he received a copy of a notice of change of solicitor from Kell Moore prior to receiving a copy of a notice of ceasing to act from T&W. In his file note of that date, Dr Galbraith recorded Mr Wolff saying that the T&W's retainer had not been terminated and that the filing of the notice of change of solicitor by Kell Moore was premature.

Evidence for T&W and Mr Taylor 28The following affidavits were read: affidavit of Mr Archibald, lawyer, dated 10 June 2010; affidavit of Mr Brooks, lawyer, dated 11 June 2010; and two affidavits of Mr Taylor, solicitor and director of T&W dated 21 June 2010 and 11 October 2010 (supplementary). As much of the factual material is identified in the chronology it is not necessary to summarise all it.

Mr Archibald 29In his affidavit dated 10 June 2010 Mr Archibald states that he was employed as a lawyer with T&W from December 2005 to December 2007. He annexes copies of two Class 4 applications he filed at the Court registry on 22 December 2006 on the instruction of Mr Taylor. The application for 06/41292 identifies the Applicants and two others as the applicants in the proceedings. The application for 06/41293 identifies four individuals (not Hutchins parties) as the applicants. Mr Archibald states it was his intention, following analysis of each clients' case and advice from counsel, that amendments to the applications would be likely to be made. In early 2007 Mr Archibald took detailed instructions from Mr Hutchins and the other clients on behalf of whom the two Class 4 proceedings had been commenced. 30Mr Archibald states that on a number of occasions he attended meetings with the Hutchins and the other clients in the proceedings to discuss the litigation and the claims each client wished to make. He discussed invalidity arguments with Mr Hutchins. Mr Archibald states that at no time did Mr or Mrs Hutchins tell him that they did not want invalidity arguments included in the case. At no time did the Hutchins inform him that they did not want any of the other clients as co-applicants in the proceedings. It was his understanding that the Hutchins, together with the other clients, wished to bring a single action in their various names in order to save costs and to include in the action arguments that the Plan was invalid. 31On or about 13 April 2007 Mr Archibald attended a meeting in Sydney with Mr King and Mr Hutchins during which they discussed Mr King's written advice dated 31 March 2007 including the amalgamation claims and validity arguments. He states that at no stage during the meeting did Mr Hutchins express any complaint about anything in the advice or anything else said at the meeting. In accordance with the advice Mr Archibald instructed Mr King to draft POC which were filed with the Court on 23 April 2007. Shortly thereafter Mr Archibald sent a copy of the POC to the Hutchins. At no time did the Hutchins raise any question or concern with Mr Archibald about the substance of the POC or make any complaint about the parties named. At some stage in 2007 Mr Archibald agreed with Mr Hutchins that as costs (of the proceedings) were now being shared five ways, and as the Hutchins' had paid the entirety of the application filing fee, there should be an adjustment on the Hutchins' account with T&W. 32Mr Archibald attended a meeting with Mr and Mrs Hutchins and other clients at the Coleambally Bowling Club on 29 May 2007. At no time at, or after, the meeting did they express any concern to Mr Archibald about the inclusion of validity arguments in their proceedings or about the possibility of adding further applicants to their case. Mr Archibald denies that Mr Hutchins expressed any concerns to him between 16 May 2007 and 1 September 2007. Mr Archibald attended the mediation for the matter on 10 - 11 September 2007, and in October 2007 passed carriage of the Hutchins matters to Mr Brooks. 33Mr Archibald was cross-examined by the Applicants' counsel about his recollection that he did not recall any complaints from the Applicants. He was also cross-examined about his familial relationship with Mr Taylor because he is married to Mr Taylor's brother's (Mr Taylor SC) daughter.

Mr Brooks (issue 8) 34In his affidavit dated 11 June 2010 Mr Brooks states that he has been employed as a solicitor by T&W since May 2005. From some point in 2007 he assisted Mr Taylor and Mr Archibald in the litigation of the substantive proceedings. From late 2007 Mr Brooks assumed shared responsibility for the case under the supervision of Mr Taylor. Mr Brooks states that he attended a meeting at the Finley office of T&W, with Mr Taylor and "the five original clients" (including Mrs Hutchins but not Mr Hutchins) on 29 November 2007. At no stage during the meeting did Mrs Hutchins say she did not agree to extra applicants being added or express any complaints about there being multiple applicants in the case. 35In reply to Mr Hutchins' affidavit of 28 April 2010, Mr Brooks denies a telephone conversation with Mr Hutchins on 30 November 2007 during which Mr Hutchins claims he complained about additional parties joining the proceedings. Mr Brooks states that he spoke with Mr Hutchins on a number of occasions about how the costs would be split with the new applicants, and at no time did Mr Hutchins make any complaint about new applicants being joined. At all times from 29 November 2007 Mr Brooks understood all the clients were very keen to add additional applicants in order to reduce their share of the costs. Mr Brooks states that if he was aware there was not unanimous agreement regarding the joining of additional applicants he would have reported it immediately to Mr Taylor. On 17 December 2007 Mr Brooks attended another meeting with the clients (including Mr Hutchins) at Coleambally, and states that at no stage during that meeting did Mr Hutchins express any disagreement with the joinder of additional applicants or make any complaint. Mr Brooks states that the matter was initially set down for hearing in April 2008 and subsequently in August 2008. He states that Mr Hutchins assisted with preparation of the case and at no stage expressed any complaint about the claims being made in the case or the number of applicants. 36Mr Brooks was cross-examined by the Applicants' counsel challenging his recollection of events.

Mr Wolff (issue 9) 37In his affidavit dated 18 June 2010, Mr Wolff states that he was employed by T&W from 2008 until 2010, and that from 2007 he assisted Mr Taylor with the substantive proceedings. Mr Wolff states that it was his understanding that T&W remained the solicitors on the record for all the applicants, including the Applicants, as there could only be a single solicitor on the record in litigation. Regarding Dr Galbraith's file note dated 29 September 2009 of their telephone conversation, Mr Wolff does not recall the words he used. However, he was of the view that the filing of a notice of change of solicitor by Kell Moore was premature as he understood the Hutchins remained undecided regarding the proceedings. 38Mr Wolff was cross-examined by the Applicants' counsel challenging his recollection of events.

Mr Taylor 39In his affidavit dated 21 June 2010 (redacted following objections and matters of privilege) Mr Taylor states that T&W continues to act as the solicitors for all the applicants in the substantive proceedings. Many of the documents contained in T&W's file relating to the proceedings are privileged, and Mr Taylor states he is not instructed to waive privilege over any privileged material. In or about late November 2006 Mr Taylor had a short meeting with the Hutchins and conveyed that T&W were acting for a number of other groundwater irrigators in the lower Murray area for the purpose of challenging the government's decision which reduced groundwater entitlements, and invited Mr Hutchins to provide the relevant documents as soon as possible and to talk to Mr Archibald. 40Exhibited to Mr Taylor's affidavit is a copy of a facsimile dated 5 December 2006, sent 6 December 2006, from Mr Hutchins to Mr Archibald providing copies of documents outlining the history of extraction calculations for the Applicants' properties (exhibit 1 tab 1). In addition to receiving another facsimile on or about 18 December 2006, Mr Taylor had two discussions with Mr Hutchins, one by telephone and the other at Mr Taylor's office where they discussed the amalgamation issues, other possible causes of action (including validity claims), Porter , the costs of litigation, and the limitation period. Mr Taylor was of the view that the three month limitation period for challenges to entitlements under the Plan was to expire for the Applicants on 23 December 2006. He indicated to Mr Hutchins that there was insufficient time to obtain advice from counsel about appropriate causes of action in the first instance. Mr Taylor said that an application seeking a broad range of relief should be filed before close of business 22 December 2006 to preserve their interests and that it could be amended later. According to Mr Taylor, Mr Hutchins responded to the effect that he knew other people with similar claims and that he would contact them "and ask them to let me know whether they will join me and share the costs". 41Mr Taylor states that on 19 December 2006 he obtained advice from Mr Taylor SC about the form of application to be filed to preserve the position of the clients, and thereafter drafted an application. After a request from Mr Taylor, Mr Hutchins attended T&W's Finley office with a cheque for $1400 for the application filing fee. In the period 20 - 22 December 2006 Mr Taylor spoke for the first time with three other persons who subsequently became parties. As at 22 December 2006 it was Mr Taylor's belief that the Hutchins' had invited these other persons to join the action. 42On 22 December 2006 Mr Taylor instructed Mr Archibald to file two applications (one in the name of individuals and one in the name of corporations). Mr Taylor states that before the applications were filed he spoke with each client about signing the application on their behalf. When he drafted the applications, Mr Taylor had the expectation that they would be amended once more detailed instructions had been obtained from the clients and advice was obtained from counsel. From early 2007 until approximately October 2007, Mr Archibald had conduct of the cases under Mr Taylor's supervision. 43The balance of his affidavit outlines further actions taken by Mr Taylor in relation to the matter. He states on several occasions that the Hutchins did not express to him any misgivings about their participation in these proceedings. He also attaches copies of correspondence between his office and Kell Moore in 2007 and 2008 concerning the proceedings. 44In cross-examination by Mr King's counsel he stated that in March 2007, at the time T&W instructed Mr King, it was Mr Taylor's understanding that the Applicants wanted to advance arguments on the validity claims and to be co-applicants with other clients of his in those proceedings. T&W briefed Mr King to provide answers to a number of particular questions. 45In cross-examination by the Applicants' counsel, Mr Taylor said his normal practice was to keep file notes but he admits that there are a number of conversations for which he has not indicated that there are file notes or said that he did not write file notes for them. 46The Applicants' counsel put to Mr Taylor that his first meeting with the Hutchins occurred on 5 December 2006, not in November as stated in his affidavit (disputed issue of fact 1). Mr Taylor replied that he believed it occurred before that date but that he does not have a file note of that conversation. Counsel suggested that the earlier date was not supported by the fact that material was faxed to T&W on 6 December 2006 and the facsimile message refers to a telephone conversation. However, Mr Taylor suggested that the message could be referring to a telephone call with Mr Archibald on 5 December 2006 as he recalled referring Mr Hutchins to Mr Archibald and that the facsimile was addressed to Mr Archibald. Counsel suggested to Mr Taylor that without taking a file note of that conversation, he could not be certain that the conversation occurred in the way in which he deposed it in his affidavit. Mr Taylor disagreed, saying he could remember the substance of the conversation, which meant he could remember this belief as to what Mr Hutchins was bringing to him as a problem but not the exact words used or the order in which they were said. 47Counsel put that all the documents faxed to T&W by the Applicants related to amalgamation claims. Mr Taylor could not recall all of the pages he was sent but based on material exhibited to affidavits which is missing some pages, he agreed that they all relate to the amalgamation claim. Mr Taylor agreed that all the material summarised in the body of the file note of the conversation with Mr Hutchins on 18 December 2006 relates to the amalgamation claim and the word "validity" appeared only in the margin which contained Mr Taylor's comments on the material in the body of the file note. When counsel suggested that Mr Hutchins mentioned only the amalgamation claim during that meeting and that it was Mr Taylor who mentioned validity, he accepted this. 48Counsel also put that during the conversation on 18 December 2006, Mr Hutchins did not offer to get other people into the matter. Mr Taylor disagreed with this proposition but admitted that there was nothing in the file note of 18 December 2006 to this effect. It was suggested that Mr Taylor misremembered Mr Hutchins' remark and that in fact, what Mr Hutchins had said was he had told other people who had also been in Porter that he had visited Mr Taylor. Mr Taylor said that as far as he could remember, he was not aware that Mr Hutchins had told anyone else about the meeting but after the meeting, he was contacted by individuals who were previously unknown to him. 49When asked whether Mr Taylor had express instructions from the Applicants to commence proceedings in their name jointly with other people, Mr Taylor admitted that he did not (disputed issue of fact 2). He wished to clarify that every person who came to him after the discussion with Mr Hutchins on 18 December 2006 was unknown to him and either directly or indirectly came through Mr Hutchins' contact with them. In circumstances where there were identical pleadings and where there was a time limit to commence proceedings, it seemed to him to be the best choice to commence proceedings jointly. He assumed he could do this because the other parties had previously known Mr Hutchins. 50Mr Taylor (issue 2) admitted to filing two applications, one in the name of all the corporate parties and one in the name of all the individual parties and that in hindsight, he could have filed one combined application. He explained this was because the other people were introduced as a result of a discussion with Mr Hutchins and they had the same limitations and identical claims. There were going to be opportunities to separate if necessary but Mr Taylor was not in a position to advise as to the claims because it was just before the Christmas vacation period and it was not possible to obtain counsel's advice as to the nature of their rights or their claims. 51Mr Taylor did not personally send a copy of the application filed 22 December 2006 to the Applicants and did not have any record of anyone else in the firm sending it either. Had there been evidence in the file that the application was sent, it would have been in his affidavit. Mr Taylor disagreed with the proposition that the reason his firm did not send the application to the Applicants was because it was evidence that he had commenced proceedings in a manner inconsistent their instructions. 52Referring to par 7 of Mr Taylor's affidavit dated 21 June 2010, counsel put to Mr Taylor that the words he attributed to Mr Hutchins were incorrect and that rather than saying "I'm not sure if it deals with all my issues anyway", he actually said, "I'm not sure it deals with my issue, anyway", referring to the amalgamation claim. The Applicants' counsel further put to Mr Taylor that Mr Hutchins said he was not interested in the validity claims, but only in the amalgamation claim. Mr Taylor disagreed with these propositions. 53Contrary to par 21 of Mr Taylor's affidavit dated 21 June 2010, it was suggested to him that Mr Hutchins did not invited Mrs Huggins to join the action, as stated in par 12 of her affidavit. Mr Taylor conceded that this was possible. 54The Applicants' counsel questioned Mr Taylor about par 23 of his affidavit dated 21 June 2010, (issue 3) where he says he rang each client after he had completed the initial application. He recalled reading it to them but did not spend a lot of time in relation to the content because he understood that there was urgency in making sure that the application was filed. Counsel directed Mr Taylor to par 25 - 26 of Mr Commins' affidavit and par 13 of Mrs Huggins' affidavit in which they similarly express no recollection of Mr Taylor discussing the content of the application. Moreover Mrs Huggins found it unlikely because then she would have known that Mr Rossato was included in the application (06/41293). Mr Taylor partially disagreed with this evidence in that he read the single applications in their original form to the clients, but Mrs Huggins' evidence was correct in relation to no identification of other parties being joined. Although there was no file note of the conversation, Mr Taylor disagreed with counsel's suggestion that he did not read out the application to Mr Hutchins. 55At par 24 of his affidavit dated 21 June 2010, Mr Taylor states that "Mr Hutchins was the client to whom [he] spoke most often about the case". The Applicants' counsel suggested that this was because Mr Hutchins' calls were memorable as he was complaining and constantly asking about his amalgamation claim. To the contrary, Mr Taylor said Mr Hutchins was an enthusiastic member and called to ask whether more material was needed or to mention anything that he felt would help the whole case. 56When questioned about the joinder of other parties in cross-examination by the Applicants' counsel, Mr Taylor insisted that during discussions after the discontinuance of Porter , neither Mr nor Mrs Hutchins expressed "any objection or complaint about the possibility of additional applicants being added". Similarly with regard to the meeting at Finley on 29 November 2007, Mr Taylor said that Mrs Hutchins did not express any objection or complaint about additional parties being added.

Evidence for Mr King 57Two affidavits of Mr King dated 29 June 2010 and 3 November 2010 were read. In the former affidavit Mr King states that he is junior counsel to Mr Taylor SC for the Applicants in the substantive proceedings. T&W are his instructing solicitors for all applicants. He was first briefed on 22 March 2007 and received instructions from various persons including Mr Archibald, Mr Brooks and Mr Wolff under the supervision of Mr Taylor. 58Upon receiving his instructions on 22 March 2007 Mr King perused two Class 4 applications filed by T&W on 22 December 2006, and the amended applications filed on 16 March 2007. Mr King formed the belief that the Applicants, along with other persons, had given T&W instructions to commence proceedings and that such persons consented to being joined as parties to the action challenging the Plan made on 1 October 2006. Mr King was also briefed in two similar matters including the Arnold proceedings. 59Mr King is not aware of the circumstances surrounding T&W's preparation and filing of the Class 4 applications or the amended applications or whether they obtained advice about the form of the applications. Mr King identifies that in an endeavour to reduce costs he entered into a retainer and costs agreement with the Applicants and another party through the offices of T&W. At no time was he advised or instructed that the Applicants objected to the sharing of costs or the costs agreement. On 31 March 2007 Mr King provided a written advice responding to various questions put to him by T&W. 60During the conference with Mr Archibald and Mr Hutchins on 13 April 2007, Mr King provided a draft POC which Mr Archibald and Mr Hutchins appeared to read. Mr King recalls that he went through each cause of action in his draft POC with Mr Archibald and Mr Hutchins in detail. Mr King suggested they consolidate the actions to save costs and for the sake of convenience. At no stage was he instructed that the Applicants did not wish to be parties to the proposed consolidated proceedings. 61As instructed, on 23 April 2007 Mr King appeared in the Court before Jagot J who made orders consolidating the proceedings with the consent of the CSO. Following detailed discussions between the representatives of the parties, consent orders were made by Talbot J on 18 May 2007 for the further conduct of the proceedings including discovery and interrogatories. On that date Mr King recalls exchanging pleasantries with the Hutchins and indicated he was pleased with the timetabled outcome for the Applicants. 62On 11 - 12 September 2007, Mr King appeared at a conjoint mediation for the applicants in three Class 4 proceedings (including the Applicants) relating to three different water sharing plans. Mr Hutchins was in attendance together with Mr Taylor and Mr Archibald. Mr King recalls that Mr Hutchins was actively involved in the mediation, and in preparation for it had commissioned a detailed analysis of his alleged financial losses (resulting from the water sharing plan decisions) from Booth Associates Pty Ltd (the Booth report). Mr King does not believe he said words to the effect "you will get your water back" to Mr Hutchins. 63Mr King attended a meeting of interested applicants at the Finley RSL Club on 15 December 2007. In early March 2008 Mr King was informed that Mr Taylor SC was instructed to lead as senior counsel at the substantive hearing. After consultation with Mr Taylor SC and T&W, the application and POC were further amended in September 2008. 64On or about 11 December 2008 Mr King recalls being informed by Kell Moore that T&W's instructions in the related Supreme Court proceedings had been terminated, and that Kell Moore would be instructing him in the conduct of those proceedings. Mr King was then instructed by Kell Moore for a further 12 months. 65Mr King states that at no stage at the meetings or discussions with the Hutchins or any of his instructing solicitors was he instructed that the Applicants did not consent or withdrew consent to being the lead applicant. During 2008 Mr King was not instructed to redraft or amend the pleading in the action except to add or remove parties. 66The additional affidavit of Mr King dated 3 November 2010 corrects the dates of mediation to 10 - 11 September 2007, inter alia. 67In cross-examination by the Applicants' counsel concerning the conference with the Applicants on 13 April 2007, counsel put to Mr King that he did not go through the POC or give the Applicants a copy of it. Mr King disagreed and clarified that he was concerned to ensure that he made a good impression on T&W and that the matter was conducted efficiently. He was particularly interested in obtaining clear instructions in relation to the Applicants' case because of the confusion with respect to the commencement of two sets of proceedings within the three month time bar period by two different solicitors. 68Secondly, it was put to Mr King that he did not get instructions to start preparing the POC until after the conference of 13 April 2007. Mr King said that after Biscoe J made directions on 30 March 2007, he discussed with Mr Archibald the desirability of having at least a draft POC for consideration at the conference. He obtained instructions to settle the POC after the conference. Thirdly, counsel put that Mr King did not go through the possible causes of action in the document with the Applicants in the way suggested in his affidavit. Mr King disagreed; he discussed the pleadings, a pleading program, an amended application and POC. He was concerned to ensure that T&W was aware of Mr King's understanding of the claims which the Applicants sought to advance. Fourthly, counsel put that Mr King did not discuss with the Applicants the consolidation of proceedings with other parties. Mr King replied that Mr Hutchins was interested in saving costs in a common attack on the Plan or challenge to the Plan and that where there were additional claims, such as amalgamation claims, they should be addressed in the one action, if possible. 69Fifthly, counsel put that Mr Archibald did not mention Mr Hutchins' football skills in an analogy relating to leading the class action. This was inaccurate according to Mr King, who recalled that at the end of the conference, Mr Archibald suggested that Mr Hutchins could lead the action because of his football skills. Mr King recalled specific details about Mr Hutchins' footballing history.

Applicants' submissions 70The relevant principles applying to the determination of an order under s 99 of the CP Act are identified in Lemoto v Able Technical Pty Ltd [2005] NSWCA 153; (2005) 63 NSWLR 300 and Kelly v Jowett [2009] NSWCA 278; (2009) 76 NSWLR 405. It is necessary to understand the legislative framework for the main proceedings in order to understand the case. The management of bore licences under the Water Act 1912, water access licences under the WM Act and the conversion of Water Act entitlements to the WM Act scheme (Sch 10 WM Act) have to be understood. Appendix 4 of the Plan has rules for determining history of extraction and includes r 10 which states: Where properties have been amalgamated, all extraction prior to amalgamation will be combined and together with extraction occurring after amalgamation will be used to calculate [history of extraction]. 71The Applicants' amalgamation claim is that each of the companies owns a separate parcel of land for which each was granted a separate bore licence under the Water Act. In calculating their water allocations the Minister and his Department treated the three parcels of land owned by them as if amalgamated for the purpose of r 10. As two licences had low or zero extraction years for the relevant period and the benefit of this was lost as a result of the amalgamation, the Applicants' water entitlements were lower than they would have been if treated separately. 72The total water entitlement of the bore licences added together was 4,899ML under the Water Act. Negotiations between the Applicants and the Department about combining the water allocations were commenced in 1999 resulting in the total maximum extraction of all three licences being limited to 4,899ML in 2001. In late 2005 or 2006, the Department advised that it considered r 10 applied to the Applicants' bore licences. Mr Hutchins complained in writing about this on numerous occasions, and also engaged a solicitor, Mr MacFarlane, to write on his behalf to the Department. The letter of 3 October 2006 encapsulates that claim. 73The Applicants also joined in Porter represented by Pike Pike & Fenwick as one of several applicants challenging the validity of the Plan. 74The Applicants' counsel presented nine factual issues he said required resolution in order to resolve the evidence in dispute. These were not linked to the particulars set out in full at par 6 above but I have done so in summarising the Applicants' submissions as it is essential to consider all the evidence in light of the particulars. Authority on the need to particularise claims of this kind is referred to in my finding at par 267 below.

T&W Part 1 - commencing proceedings in manner inconsistent with instructions and T&W Part 2 - joining further parties, causes of action (issues 1 - 3) 75Mr Hutchins approached Mr Taylor in December 2006 (Mr Taylor says the approach was late November). There is a dispute as to what was said at that first meeting. A faxed document of 17 pages sent to Mr Archibald contained much of the correspondence sent to the Department by Mr Hutchins or his previous solicitor. Not all of the facsimile transmission can be found. All of the documents refer only to the amalgamation claim, a significant matter. Mr Archibald spoke to Mr Hutchins and made a file note of that discussion headed "Open new file" which deals only with the amalgamation dispute with the Department. On 18 December 2006 a further 13 page facsimile was sent by the Hutchins to Mr Taylor. Not all is in evidence. What can be found relates to the amalgamation claim. Issue 1 is the dispute of what was said in conversations with T&W before 22 December 2006 and what instructions were given to T&W during that time. 76There were two discussions on 18 December 2006, probably one by telephone and one in person. It is not disputed that the conversations referred to the amalgamation issues, other possible causes of action, including validity claims, Porter , costs of the proposed proceedings and limitation periods. There is a dispute about whether Mr Hutchins said he would undertake to bring other people to T&W to join the proposed action. Mr Hutchins denies saying this. Issue 2 is the dispute as to what was said on 18 December 2006. 77Other people approached T&W to be represented on 19, 20 and 22 December 2006. Mr Taylor assumed they had been sent to him by Mr Hutchins as he had not met any of them before. Mr Hutchins accepts that he told Mr Rossato, Mr Commins and Mrs Huggins that he had engaged T&W about the amalgamation issues but denies that he asked them to join any action with him. Mr Commins' unchallenged evidence is that he was not asked by Mr Hutchins to join any action, rather his intention was to commence an action in the name of his company against the Department based on its reliance on assurances received from the Department. Mrs Huggins' evidence is that Mr Commins advised her of his proposed reliance claim and that caused her to approach T&W . 78On 22 December 2006 Class 4 proceedings were commenced in the names of the Applicants and two other entities (Commins Partnership Pty Ltd and NA & J Investments Pty Ltd). T&W did not have instructions to commence the proceedings and collected two filing fees. (Mr Taylor conceded he did not have express instructions to do so.) Issue 3 is whether the relief claimed in the application for the substantive proceedings is in accordance with the Applicants' instructions. Issues 1, 2 and 3 are part of the one issue.

King Part 1 - failure to advise (issues 4 - 5) 79Mr King was briefed to give advice in March 2007 to the Rossatos and the Hutchins as they had similar issues. Mr King provided an advice on 31 March 2007. A conference was held on 13 April 2007 and there is a dispute about what was said at that conference (issue 4). 80Points of Claim were drafted. Instructions were given by the Hutchins to discontinue Porter and this eventuated at the directions hearing on 16 May 2007 at which Mr King appeared. The Hutchins had the false impression that the substantive proceedings and the Rossato proceedings (06/41293) were consolidated on this date and at the request of the Court. It is agreed that the Hutchins and Mr King had a conversation after that hearing but there is disagreement about what was said (issue 5). Mr Hutchins' evidence is that he raised concerns with Mr King and Mr Archibald at that meeting about whether consolidation of his claim with the validity claims and other claims meant his amalgamation claim was being lost.

T&W Part 2/King Part 1 - "lost" amalgamation claim (issues 6 and 7) 81Between 16 May 2007 and the mediation on 10 - 11 September 2007 a number of conversations took place between Mr Hutchins and T&W , the contents of which are disputed. In particular, Mr Hutchins claims (and T&W denies) that Mr Hutchins made several complaints that the Hutchins companies' amalgamation claim was being "lost" in the validity claims well before his letter of complaint of 10 April 2008. Issue 6 is whether Mr Hutchins complained about the Applicants' amalgamation claim being lost to Mr Taylor and Mr Archibald before the letter of complaint dated 10 April 2008. 82On 12 September 2007, Mr Hutchins had a conference with Mr King. What was said is in dispute (issue 7).

Booth report (not particularised) 83On 3 September 2007, T&W commissioned Booth Associates and the final report was delivered on 13 September 2007. The Booth report indicated that the Applicants' total Water Act water allocation had been 4,899ML and that the Department had converted that to a water access licence entitling them to 1,925ML. It was opined that, had the Department applied r 1 rather than r 10 of the Plan to the Applicants' water allocation, the water access licence would have entitled them to 3,630ML. Mr Taylor and Mr King gave evidence that the Booth report was intended to be used both to support the Applicants' position at mediation and as evidence at the hearing. There is no evidence that this was ever brought to the Hutchins' attention or that it prompted either T&W or Mr King to consider whether having the amalgamation claim as part of the larger action was in the Hutchins companies' best interests.

New applicants added and discussions between the Hutchins and T&W (T&W Part 2(4)) (issue 8) 84After 11 September 2007, there were several meetings and conversations between the Hutchins, officers of T&W and others. In October 2007, Mr Archibald handed day to day carriage of the matter over to Mr Brooks of T&W. 85In particular, there was a meeting at Finley on 29 November 2007, at which the issue of adding further applicants was discussed. Mrs Hutchins attended but Mr Hutchins did not. The next day Mr Hutchins had a telephone conversation with Mr Dale Brooks. The contents of conversations at the meeting and during the subsequent telephone call are matters of dispute. The dispute relates to the Hutchins' attitude to the addition of further parties. Issue 8 is w hat was said at the meeting in 2007 and during the telephone call between Mr Brooks and Mr Hutchins the next day. 86On 14 December 2007, T&W filed a further amended application in the substantive proceedings, which added a further 28 co-applicants. 87In early 2008, T&W prepared the matter for hearing. Mr Hutchins swore an affidavit on 18 March 2008 which dealt almost exclusively with the amalgamation issue.

T&W Part 6/Part 7 - continuing to assert retainer/failure to cooperate with Applicants new lawyers (issue 9) 88The Hutchins met with Mr Williams of Kell Moore on 3 April 2008 to discuss whether the Applicants' interests were well served by T&W. In a letter dated 4 April 2008 the Hutchins wrote to Mr Taylor expressing their disappointment. Kell Moore was retained by them on 7 April 2008 to advise them in relation to T&W's conduct of the proceedings. On 11 April 2008 Mr Hutchins wrote again to Mr Taylor and stated that the Hutchins had always been concerned about why they were in the combined claim apart from the opportunity to share legal costs. 89Mr Williams contacted Mr Taylor on 30 June 2008 informing him of Kell Moore's involvement and requested documents. Numerous telephone calls and letters were exchanged between them. Mr Taylor provided the most recent version of the pleading but not the original application. In December 2008 Mr Hutchins instructed Kell Moore to terminate T&W's retainer and to act to extricate the Applicants from the substantive proceedings so that they could run their amalgamation claim independently and without delay. On 11 December 2008 Kell Moore wrote to T&W. While there is dispute whether this constituted a termination of retainer, in cross-examination Mr Taylor agreed that from that time he realised T&W had lost the confidence of the Hutchins and would not be taking instructions any more. Any instructions T&W needed would come through Kell Moore. In letters dated 31 August 2009 and 8 September 2009 (exhibit 1 tabs 19 and 20 and affidavit of Mr Williams 27 November 2009 AMW13 and AMW14) Kell Moore stated that the Hutchins' retainer of T&W was terminated (not particularised). 90Kell Moore entered into discussions with the CSO between January and August 2009 in relation to the Applicants' desire to extricate themselves from the proceedings and recommence their amalgamation claim independently. The discussions were delayed by the CSO's difficulty in getting instructions from their clients (Dr Galbraith's oral evidence). During this period, T&W had discussions with the CSO regarding progress in the matter. During these conversations those officers did not mention that they had ceased to hold a retainer to act (or directly act) for the Applicants. Issue 9 is whether on 25 September 2009 Mr Wolff represented to Dr Galbraith that the Applicants had not yet terminated T&W's retainer. 91Between January (not particularised) and August 2009 Kell Moore sought further information from Mr Taylor in which he asked for a history of the proceedings. Mr Williams was never told that the Applicants had had co-applicants from the beginning. On 17 August Mr Williams requested that T&W give Kell Moore authority to view the Court file, repeated shortly after 17 August on 19 August and 8 September 2009. Mr Taylor's delay in granting Kell Moore's request was because he was seeking advice on privilege issues from Mr King. T&W did not give Kell Moore the requested authority until 11 September 2009. 92This failure to cooperate and provide information resulted in Kell Moore having an incomplete understanding of the Class 4 application which Mr Williams believed, based on his instructions from Mr Hutchins, had been commenced by the Applicants alone. On 24 August 2009 the misjoinder motion was filed seeking orders under Pt 6 r 6.29 of the Uniform Civil Procedure Rules 2005 (the UCPR). By 29 September 2009 Kell Moore had inspected the Court file and realised that the Applicants had never been the sole applicants and subsequently amended the misjoinder motion to reflect the correct history. An undertaking in the form sought by the Applicants was given by the CSO on 4 November 2009. Consequently, on 6 November 2009, consent orders were made granting leave for the Applicants to discontinue from the substantive proceedings. 93Mr Williams accepted in cross-examination that he did have the Class 4 application a year before, in documents received by Mr Hutchins from the Department under a Freedom of Information Act 1989 (FOI) request and sent to Mr Williams on 16 July 2008. Had he looked at the document then he would not have filed the misjoinder motion. He was cross-examined about a letter he wrote on 18 July 2008 to T&W (exhibit D tab 3) which suggested he had the Class 4 application then. On checking his file he produced the whole of the FOI bundle of documents and conceded that he should have had attention to that document. He was candid and honest in his evidence. 94In summary, a copy of the Class 4 application was not sent to Mr and Mrs Hutchins, Mr Taylor cannot recall doing so but refers to usual conduct that he would, no file notes were kept for this by Mr Taylor and Mr Commins states that he did not receive a copy of the application. The Hutchins' evidence should be accepted on this issue.

Credit of witnesses in relation to factual issues 95Issues 1 - 3 raise the nature of Mr Hutchins' instructions to T&W from the outset. The Court should not accept that Mr Hutchins wanted to challenge the Plan because the contemporaneous documents all support the contention that the Hutchins' concern was the way in which their water access licence had been calculated. The documents do not refer to any other claims. Only one conversation deposed to by Mr Taylor is supported by a file note made by him of a discussion between Mr Taylor, Mr Archibald and Mr Hutchins on 18 December 2006. The main body of the file note refers only to amalgamation issues. The words "validity of the plan" only appear in small writing on the left hand margin. Mr Taylor agreed in cross-examination that the body of the file note represented what Mr Hutchins had said and the left hand margin what Mr Taylor raised. The words attributed to Mr Hutchins do not ring true as he does not use phrases such as "preserve their rights". As late as 27 March 2007, Mrs Huggins was referring to T&W as representing some members of the Porter group in relation to individual circumstances. Further Mr Commins was surprised that no reliance relief was in his application. An explanation is that Mr Taylor was focussed on challenging the validity of the WM Act and Plan as he already had experience in this area in the Arnold case. This focus was exacerbated by his consciousness of the impending deadline to challenge the Plan. He erroneously assumed that the Hutchins were interested in pursuing a challenge to the validity of the WM Act or Plan in addition to their amalgamation claim. The relief sought in the original application was not in accordance with the Hutchins' original instructions including that no instruction was sought or given to commence with other co-applicants. 96In relation to issue 4, Mr King's evidence of what occurred at the conference on 13 April 2007 differs from Mr Hutchins' on most aspects. Mr Hutchins' evidence should be preferred because there is no file note of the conference. Mr Archibald was not cross-examined by Mr King's counsel on this or any other issue. Mr Archibald did not corroborate the detailed evidence of Mr King. It is unlikely that Mr King went through the draft POC with Mr Hutchins. No document on the T&W file was produced showing a communication between Mr King and T&W between 31 March 2007 (when he delivered his advice) and 13 April 2007. It appears from Mr Archibald's affidavit that it was more likely than not that Mr Archibald did not give Mr King instructions to draft POC until after, or very shortly before, 13 April. There is nothing to indicate that Mr Hutchins was the leader of the action in the sense suggested by Mr King. Mr King's evidence in cross-examination was inconsistent and changeable. 97In relation to issue 5 (directions hearing on 16 May 2007), Mr King denies that Mr Hutchins questioned the wisdom of his amalgamation claim which assumed the validity of the WM Act and the Plan being run together with claims by others challenging the WM Act and the Plan. Mr Hutchins' evidence should be preferred as he had greater credibility as a witness and did not make the same errors about dates as Mr King. The Court will find it more likely that Mr King was not paying full attention to Mr Hutchins and that Mr Hutchins' memory is better. 98In relation to issue 6, Mr Hutchins' consistent evidence was that from shortly before 16 May 2007 he raised concerns orally with T&W that the amalgamation claim was being lost in the larger claim. T&W deny this but agree that Mr Hutchins was often in contact with them. 99Mr Taylor's evidence was that the first time any such concerns had been raised with him was Mr Hutchins' letter of 10 April 2008 (exhibit E tab 30) which stated "As you know, we have always been concerned as to why we were in this combined claim, apart from the fact we get to share legal costs." One would normally expect an experienced solicitor to reply immediately. It is significant that there is no such evidence from Mr Taylor or any officer of T&W, and it is too convenient that the first time Mr Hutchins ever made this complaint was in writing. As Mr Taylor conceded in cross-examination, in his experience, lay clients normally complain orally long before they reduce their dissatisfaction to writing. 100Moreover, Mr Taylor did concede that Mr Hutchins had expressed concerns that the amalgamation claim was not getting "sufficient emphasis". The most likely explanation is that Mr Taylor's focus on validity issues caused him to misunderstand Mr Hutchins' concerns and downplay them as matters of emphasis rather than signals that one of his clients had real concerns as to how his interests were being advanced. The Court should prefer the evidence of Mr Hutchins. 101In relation to issue 7 (conference on 12 September 2007), Mr Hutchins' evidence should be preferred to Mr King's for the reasons already given. 102In relation to issue 8, Mrs Hutchins' evidence was that she did not agree to new applicants being added to the proceeding at the meeting of 29 November 2007 but instead said that she would have to consult with Mr Hutchins and they would get back to T&W with an answer. Mr Taylor and Mr Brooks deny this. The Court should prefer the evidence of Mrs Hutchins. Given the evidence as to their close working relationship, it is inherently improbable that Mrs Hutchins would have made such a decision without first consulting with Mr Hutchins. Moreover, it is now conceded that Mr Hutchins had a long telephone conversation with Mr Brooks the next day. Such a conversation adds considerable weight to Mrs Hutchins' evidence. 103As to that conversation, in cross-examination Mr Brooks admitted it occurred (once he had seen the telephone records annexed to Mr Hutchins' reply affidavit) but denied its contents. However, Mr Brooks could not point to any file note of that conversation. He did not indicate that he recalled its contents at all. The Court should accept Mr and Mrs Hutchins' evidence that Mr Hutchins expressed serious concerns about the addition of new applicants but felt that as just one of five applicants, he "probably [didn't] have much say in the matter except to go along with it." 104In relation to issue 9, Dr Galbraith's evidence should be preferred to that of Mr Brooks given his superior practice of keeping file notes. 105Mr Taylor treated the Applicants as part of a class action when the proceedings were not such an action. This resulted in a failure to consider individual claims. Ordinary negligence with serious consequences falls within s 99 of the CP Act, consistently with Lemoto which adopted English authorities such as Myers v Elman [1940] AC 282 . 106If factual issues 1, 2 and 3 are resolved in the Applicants' favour then T&W Part 1(1) and (2) are not in dispute. T&W Part 1(3) is admitted by Mr Taylor and T&W Part 1(4) and (5) are made out. The action commenced was not authorised by the Hutchins. Acting contrary to or inconsistently with instructions amounts to serious neglect or serious incompetence. 107In relation to T&W Part 2, the relevant date is from 20 April 2007 when the Rossatos and Huggins were added and additional parties were added on 14 December 2007. The Booth report and Mr Hutchins' evidence that he was never advised of his interests concerning the amalgamation claim should be accepted. T&W Part 2(3) is made out if factual issue 6 is found for the Applicants. Each of these dates are occasions when the Hutchins should have been advised of what was in their best interests in relation to the amalgamation claim, namely that this be heard separately. The joinder of a large number of parties on 14 December 2007 had greater costs and potential for delay compared to the joinder of two parties on 20 April 2007. 108In relation to T&W Part 6, the evidence of Dr Galbraith is that there was delay in giving undertakings due to difficulty in getting instructions. It is accepted that in light of the evidence the allegations in T&W Part 6 do not result in any or very little wasted costs. 109In relation to T&W Part 7, this needs to be viewed on the basis that Kell Moore had been seeking information for quite some time since June 2008 (not particularised, particular commences from 17 August 2009) and access was granted on 8 September 2009. T&W failed to tell Kell Moore that the proceedings were commenced for several applicants including the Hutchins and failed to provide the application which would show this. While it emerged in cross-examination that Mr Williams had the application as part of FOI documents, it was not unreasonable that he would have failed to recall that he had seen that document a year or so later when matters became litigious. In any event, if this does not negate any case for delay being caused by T&W that simply means that only the costs of amending the motion should not be granted. The costs of the motion are otherwise payable. 110In reply the Applicant's counsel submitted that firstly, s 99 is not limited to breaches of the duty owed to a court by a lawyer but to negligent behaviour more generally. Secondly, there is a duty imposed on a solicitor to act in accordance with instructions in court per Lord Wright in Myers v Elman quoted in Lemoto . This case does not break new ground. While it is accepted that parties have rarely used wasted costs proceedings rather than a negligence action for relief, such an action is not precluded. The costs of discontinuing the proceedings in this Court should fall on their lawyers hence the claim for indemnification for the Crown's costs sought as one of the orders. 111In relation to the Booth report, which was not particularised, the question is whether the Respondents have been granted procedural fairness as there is no requirement to particularise as would be the case if the matter was in the common law division of the Supreme Court. The Booth report is not a separate allegation but further evidence of what had otherwise been notified. It was evidence first adduced by the Respondents (attached to Mr Archibald's affidavit exhibit 2 tab E) and there can be no criticism of its use in cross-examination on the basis that it was not particularised. No prejudice has been pointed out by the Respondents as a result of referring to it. 112The amalgamation claim is a narrow statutory construction argument which was first raised by the letter from Mr MacFarlane in October 2006 to the Department. The Court should find that this was a simple matter, which can be seen if the current Supreme Court statement of claim is viewed. That there is a claim for compensation reflects that it is now four years since the events complained of. 113Whether Mr Hutchins was interested in a validity challenge to the Plan in December 2006 is not the central question, rather it is what were the instructions he gave to T&W. Mr Hutchins' purpose was to find a replacement for Mr MacFarlane to pursue the amalgamation claim. This is reflected in the words Mr Taylor refers to in his affidavit dated 21 June 2010. To the extent he was interested in validity issues these were explored in Porter . According to their evidence the Hutchins did make a complaint on 16 May 2007 in the discussion with Mr King after the directions hearing (Mr Taylor denies that Mr Hutchins expressed concern to him). 114There was no basis to say that Mr Taylor had implied instructions to commence proceedings jointly when he received two sets of filing fees, one from the Hutchins and one from Mr Commins. No explanation for this has been received (I note that Mr Taylor accepts this was a mistake in his oral evidence). 115Later ratification of instructions cannot be relied upon by the Respondents as that raises the particularised failure to advise. There was no advice to the Applicants as to whether it was in their interests to ratify their inclusion in proceedings commenced contrary to their instructions. 116It was possible in the course of the proceedings to get evidence of instructions and advice by Mr Taylor and Mr King in relation to Mr Hutchins as he was able to waive privilege over this material. Consequently, whether Mr King was instructed to do a particular thing in relation to Mr Hutchins could be asked of him. A similar approach could have been taken in relation to other privileged material if the Respondents had wished to rely on this. All parties were harmed in the limiting of evidence before the Court because of privilege. Mr Hutchins got over this disadvantage and the Respondents could have done the same. Therefore their argument that the Court cannot be satisfied of the advice given because not all the documents could be placed in evidence should not be accepted. 117Mr Priestley's advice did not address whether the amalgamation claim can properly be brought as part of the substantive proceedings. 118The costs incurred by the Hutchins fall within s 99 as these were caused by the actions of their former lawyers in commencing proceedings which they did not have instructions to commence, and continuing proceedings because they were not advised that it was against their interests, so that costs were incurred when they left the action. 119Step (ii) in Karwala v Skrzypczak [2007] NSWSC 931 at [7] (Windeyer J), listed in par 130 below, refers to unnecessary costs. These must be considered as any costs that were incurred by the serious neglect of the lawyers. 120There is no need to have expert evidence in an action based on professional negligence, see Weller v Phipps [2010] NSWCA 323 at [67] (Hodgson JA, Beazley and Young JJA agreeing). It is too late to argue these proceedings are an abuse of process as Mr King's counsel seeks to do. 121A letter from Kell Moore dated 4 July 2008 (exhibit 4) was used to challenge Mr Hutchins' credit. Mr Hutchins' evidence is that he had not seen that letter before it was sent. Rather the letter is a response to discussions that Mr Williams had with Mr Taylor and it does not reflect Mr Hutchins' state of mind. 122The letter of complaint dated 4 April 2008 sent by Mr Hutchins (exhibit E tab 29) refers to amalgamation albeit in the context of mediation and states there are several other matters of concern. The letter dated 10 April 2008 (exhibit E tab 30) raises this point more squarely by stating their concerns about being in a combined claim (see also par 99 above). 123It must be remembered that, whilst there are some analogies to be drawn, an application under s 99 of the CP Act is not a professional negligence action. One of the purposes of s 99 is to provide aggrieved clients with a method of redress for unnecessary costs that is faster and more efficient than an action in professional negligence. This conduct amounts to serious neglect or serious incompetence as provided for in s 99. If a claim under s 99 is related to the failure to comply with an officer's duty to the Court, the failure to properly implement instructions in relation to proceedings before the Court is a breach of that duty.

Governing principles 124The purpose of the power to award costs in s 99 is to ensure that legal practitioners observe their duty to the Court and to the administration of justice ensuring amongst other obligations the expeditious and efficient conduct of litigation : Kelly v Jowett at [57]. The wasted costs jurisdiction is exercised where it is demonstrated that a lawyer has failed to fulfil his or her duty to the Court and to realise his or her duty to aid in promoting, in his or her own sphere, the cause of justice: Kelly v Jowett at [61] and Puruse Pty Ltd v Council of the City of Sydney [2009] NSWLEC 163; (2009) 169 LGERA 85 (Pepper J) at [45]. 125Without s 99 it is not possible for an opposing litigant to recover costs wasted by the conduct of the lawyer. This is to be contrasted with the position of the client, to whom the lawyer owes a common law duty. It is no part of s 99 to provide a means of compensation for loss caused by breach of this duty. Such a claim is governed by the common law of negligence and breach of retainer, based upon well established and comprehensive principles. This duty is different to that owed to a court. The latter is founded in the public interest that the procedures of a court are conducted by its officers as economically and efficiently as possible: CP Act, s 56; Harley v McDonald [2001] 2 AC 678 at [44] - [45] (Privy Council); Holmes v DMS Pacific Exports [2007] NSWSC 563 at [37] (Hammerschlag J). 126The wasted costs jurisdiction may not be used for the purposes of making a claim for professional negligence. Such a claim is properly the subject of separate proceedings: Harley v McDonald at [51]. Professional negligence proceedings are different in structure and raise different issues (including for example, scope of the duty of care, standard of care and commonsense causation). The distinction between the two proceedings is fundamental. The Court's only concern when exercising its wasted costs jurisdiction is to serve the public interest in the administration of justice. It is not the Court's function to adjudicate on the position between the client and the lawyer: Harley v McDonald at [52] - [53]. 127There is no case where the Supreme Court or this Court has made an order under s 99 for a lawyer to compensate a client. In Kendirjian v Ayoub (No 2) [2008] NSWCA 255 and Puruse , the court ordered a client to pay the wasted costs of the opposing litigant, and then ordered the lawyer to, in effect, indemnify the client for those costs. In each case, it is apparent that the court's objective was to compensate the opposing litigant, not the client. There are four cases where clients have applied for s 99 orders, but in each case the application was dismissed: Ideal Waterproofing Pty Ltd v Buildcorp Australia Pty Ltd [2006] NSWSC 155 (Sully J); Holmes ; Dubow v Fitness First Australia Pty Ltd [2007] NSWSC 1390 (Hulme J) and European Hire Cars Pty Ltd v Beilby Poulden Costello [2009] NSWSC 526 (Bryson AJ). Whilst s 99(2)(a) contemplates that a limited order may be made which has that effect, the absence of any instance where the court has exercised that power reflects the centrality of a breach of a duty to the court (not the client) in the s 99 regime.

Causation of serious neglect/incompetence 128Serious neglect or serious incompetence must have resulted in costs for s 99 to apply. The term "neglect" does not mean tortious or mere negligence but gross negligence in the context of the lawyer's duty to the court: Etna v Arif [1999] 2 VR 353 at [79] - [82] (VSCA). This follows from: (a) the history of judicial and statutory regulation of wasted costs orders (see below); (b) the inclusion of neglect in "serious neglect, serious incompetence or serious misconduct"; and (c) the express qualification "serious". An applicant must demonstrate that a waste of costs was caused by the lawyer's breach of duty to the court: Kelly v Jowett at [61].

Discretion 129The jurisdiction to make a costs order against a lawyer must be exercised with care and discretion, and only in clear cases: Kelly v Jowett at [60]; Lemoto at [92(a)]; Re The Black Stump Enterprises Pty Ltd (No 2) [2006] NSWCA 60 at [8] - [9] Such an order will only be made in exceptional cases: Lemoto at [93]. 130A proper approach to the determination of an application under s 99 is to adopt a three stage enquiry per Karwala at [7] and Ideal Waterproofing at [13]: i) has there been serious neglect, serious incompetence or serious misconduct by the lawyer? ii) if so, did that conduct cause the applicant to incur unnecessary costs? iii) if so, is it, in all the circumstances, just to order the lawyer to compensate the applicant for the whole or any part of the relevant costs?

Privilege 131Where the Court is precluded by legal professional privilege from knowing the full circumstances, the lawyer must have the full benefit of any doubt in order to avoid unfairness: Medcalf v Mardell at [23] (Lord Bingham, with whom Lord Hoffmann and Lord Rodger agreed), at [42] - [44] (Lord Steyn) and at [61] - [62] (Lord Hobhouse); Lemoto at [92(f)]; and Re The Black Stump Enterprises Pty Ltd at [10] - [12] . Penal orders are being sought. The Court must proceed with extreme care and must not make a wasted costs order unless it is satisfied that: (a) there is nothing the lawyer could say, if unconstrained, to resist the order; and (b) there is nothing the lawyer could say, if unconstrained, on the question of discretion: Medcalf v Mardell at [23] (Lord Bingham) and at [63] (Lord Hobhouse) and Lemoto at [92(f)]. 132For this reason, where legal professional privilege intervenes, the scope for making a wasted costs order is "very limited": Medcalf v Mardell at [24] (Lord Bingham) and Treadwell v Hickey [2010] NSWSC 1119 at [32] (Barrett J) . In this case, Mr Taylor and T&W are prejudiced by their inability to adduce evidence of advice given to the Hutchins and communications with counsel. In those circumstances, it is an error of principle to condemn them unheard: Medcalf v Mardell at [2 5] (Lord Bingham).

Serious neglect/incompetence has to be proved 133For each particular, the threshold question is whether the Hutchins have proved, to the requisite standard, that there has been "serious neglect" or "serious incompetence". The particularised complaints against T&W and Mr Taylor either alone or together, do not justify an order under s 99. 134With regard to the costs claimed, those flowing from their participation in the substantive proceedings until 24 August 2009 were not wasted in the relevant sense but were incurred because of the Hutchins' decision to participate in the proceedings. The Applicants were ordered to pay these when they decided to leave the proceedings but had they stayed, the costs would not have been payable unless they lost the case. Although the Crown's costs flowing from the misjoinder motion (if any) may be wasted costs, they do not arise from the conduct of T&W and Mr Taylor. Essentially, the Applicants are claiming compensation for the expense of participation in litigation.

Witnesses' credit 135The Applicants' case depends upon the oral evidence of Mr and Mrs Hutchins which stands in contrast to the documentary evidence. Mr Hutchins was not a satisfactory witness because he tried to mould his evidence to advance his interests, and admitted as such and was evasive. Mrs Hutchins' evidence also should not be accepted because she admitted the Hutchins' affidavits in reply were a collaborative effort and to lack of memory. Applying the principles in Briginshaw v Briginshaw (1938) 60 CLR 336 , the Court should not find any of the allegations proved where the proof depends solely upon the oral evidence of the Hutchins. 136The evidence of Mr Taylor, Mr Archibald, Mr Brooks and Mr Wolff should be accepted because they endeavoured to assist the Court to the extent that they remembered. The fact that they cannot remember all matters raised with them does not affect their credibility.

Particularisation of complaint 137Given the gravity of an order under s 99, it is essential that a lawyer be given full and sufficient notice of and opportunity to answer the complaint: Lemoto at [92(e)] and [146]. The application was subsequently prepared upon the basis of the Applicants' particulars, the function of which is to limit the issues of fact to be investigated: Mummery v Irvings Pty Ltd (1956) 96 CLR 99 at 110. In the interests of fairness, the following matters in the Applicants' counsel's submissions which were not particularised should not be considered : (a) failure by Mr Taylor to give Mr Williams a copy of the application in July 2008 - see written submissions at par 69 - there is no evidence from T&W about their response to being told by Mr Williams on 18 July 2008 that he already had a copy , (b) failure to respond to Kell Moore's letter dated 31 August 2009 about termination of the retainer - see written submissions at par 82(a) - there is no evidence from T&W about their response to this letter; (c) failure to give advice when additional applicants were added in December 2007 about what "rights" the Hutchins had; and (d) a failure to advise the Hutchins that it was not in their interests to run the validity claims at all, given the mathematical implications of the Booth report, see written submissions at par 58. (e) failure to respond to Mr Williams since June 2008 when particulars specify from 31 August 2009.

Six particularised complaints 138T&W was first contacted by the Applicants in November or December 2006 and the Applicants left the proceedings about three years later. T&W and Mr Taylor have not put on evidence about everything they did, and all the advice they gave, over the entire period but addressed the specific complaints.

T&W Part 1 - commencing proceedings in a manner inconsistent with instructions (issues 1 - 4)

Has there been serious neglect or serious incompetence? (step (i) per Karwala ) 139This complaint relates to the Class 4 application including the validity claims and not the amalgamation claim and other applicants. The evidence of Mr and Mrs Hutchins that in late 2006 they had no interest in challenging the validity of the Plan is given with hindsight that the challenge to the Plan was rejected in this Court ( Harvey and Tubbo ) and in the Court of Appeal ( Tubbo Pty Ltd v Minister Administering the Water Management Act 2000 [2008] NSWCA 356) . Mr Hutchins went to the expense of obtaining legal advice about the judgment from Kell Moore. Caution must be exercised before accepting retrospective evidence ( Ellis v Wallsend District Hospital (1989) 17 NSWLR 553 at 560E (Kirby P) and 581E (Samuels JA)) even if the Hutchins are well intended. 140Contemporaneous objective facts ought be considered as these show that up to April 2008 the Hutchins wished to overturn the Plan. The Hutchins' participation in Porter , the sole purpose of which was to overturn the Plan, until they received advice from Mr Robertson SC that they did not enjoy reasonable prospects of success, is one of the most decisive of the objective facts: Mr Hutchins' affidavit dated 28 April 2010 par 34 and par 42. Had Mr Robertson SC advised otherwise, they would have continued to prosecute the validity claims in Porter : TS199.1 - 22. The Hutchins were aware this was the focus of the proceedings. Mr Taylor and Mr Hutchins discussed validity claims on 18 December 2006 (exhibit 1 tab 2) and it does not matter who raised it. Mr Archibald discussed validity claims with Mr Hutchins who never said he was not interested (undisputed). Validity claims were also discussed at the conference on 13 April 2007 (undisputed). The Hutchins admit that from at least 16 May 2007 they were aware the proceedings included validity claims but made no complaint. Rather they agreed to this course. 141The only plausible conclusion which can be drawn from this evidence is that the Applicants participated in Porter because they considered it to be in their best interest to overturn the Plan, if that could be achieved. The Hutchins accepted that they would get more water if the Plan was overturned and it is in their commercial interests as then they would return to their original water entitlements under the Water Act. 142Additionally, there is the disputed matter of whether the draft POC was tabled and discussed on 13 April 2007. Mr King's evidence should be accepted as he has a clear recollection and his evidence is consistent with that of Mr Archibald who said the validity arguments were discussed (but cannot recall what was said). That Mr Hutchins failed to refer to this critical meeting in his evidence in chief is telling because it would be an important factual matter in support of his case. His silence on it indicates that his evidence is selective. Mr Archibald instructed Mr King to draft the POC at some stage after he received Mr King's advice on 31 March 2007. Mr Archibald said in oral evidence that he did not know whether he asked Mr King to draft the POC before or after the conference. He did not make file notes of most of the conversations he had with Mr King. Mr King's evidence that the POC were discussed is inherently likely. The suggestion that Mr Archibald asked Mr King to draft the POC after the conference was rejected by him. That the draft POC were discussed at the conference is supported by Mr Archibald sending a blank email attaching a copy of the POC to Mr King on 2 May 2007 without an explanation of the content of the document as there was no need for explanation. 143The Court should find that the Hutchins gave Mr Taylor the instructions set out in his affidavit dated 21 June 2010 at par 7 and par 10. There is no basis for finding that the Class 4 application departed from their instructions about causes of action. Mr Taylor's evidence is that the purpose of the application was to keep the Applicants' options open, in circumstances where it was not possible to get advice from counsel before Christmas about what those options were, and that is what he told Mr Hutchins. The finding of fact which is best supported by the evidence and which the Court should make is that Mr Hutchins accepted Mr Taylor's proposal. Accordingly, as a matter of urgency the application contained a statement of the relief claimed but did not contain any pleading. 144Given that the document merely stated the relief claimed, the rights of amendment and the intention to reconsider the position in the new year, it does not matter whether relief was sought in relation to the amalgamation claim or not. In any event, par 6 - 7 of the application seeking a certiorari order and damages address the amalgamation issues as they were considered in 2006. There is no basis to find that there was any serious neglect or serious incompetence by T&W or Mr Taylor for the failure to include the amalgamation claim.

T&W Part 1(3) (overlaps with T&W Part 2(4)(a)) 145With regard to the inclusion of other applicants (Commins Partnership Pty Ltd and NA & J Investments Pty Ltd) in December 2006 (T&W Part 2(4)(a)), there is a factual dispute about the Hutchins' attitude to that as at 22 December 2006. As the Court should find that they were interested in challenging the Plan, their evidence to the effect that they did not want to have co-applicants with whom to share the costs and associated risks is illogical and should not be accepted. Mr Taylor accepts that he did not have express instructions to commence the proceedings with co-applicants but he understood that the relevant instructions were implicit in his dealings with Mr Hutchins. Mr Taylor's evidence is that on 18 December 2006 Mr Hutchins stated that other people had similar claims and may want to preserve their rights too. He said he would contact them and ask if they would join and share the costs. Mr Hutchins' denial is only plausible if he had no interest in the validity claims. Further undisputed facts (par 106(a) - (j) of written submissions) support Mr Taylor's views. 146The conclusion that such instructions were implied is supported by the following matters: (a) Mr Taylor spoke to Mr Hutchins before the application was filed and in the ordinary course would have explained the document to him - there is no dispute that this conversation occurred, Mr Hutchins' affidavit dated 8 October 2010 at par 24 and Mr Hutchins does not remember what was said; (b) it is inherently implausible that Mr Taylor would have included multiple applicants in circumstances where he thought the Hutchins wished to go it alone; (c) the Hutchins admit that by 16 May 2007 they were aware that there were other applicants but expressed no surprise and made no complaint (until April 2008). 147In the circumstances, t his is compelling and should be accepted. 148Mr King's evidence should also be accepted that at the conference on 13 April 2007, Mr Hutchins did not complain or show surprise and discussed leading the "class action". At the least the Hutchins were aware from the outset that they were involved in a combined action capable of reducing their costs. 149Even if the Hutchins were not aware of the co-applicants in December 2006, the filing of the application was not "neglect" or "incompetence", let alone "serious" neglect or incompetence. There is no doubt that all the applicants wanted to commence proceedings and, if not together, would have done so individually. No parties were brought before the Court who did not intend to be there and there was no impact upon the Court's processes. No harm was caused to the parties or the Court by T&W's actions. There is no basis for the Court to conclude that there was serious neglect or serious incompetence by Mr Taylor filing the application with co-applicants. 150Even if Mr Taylor did not have instructions to join co-applicants, the Hutchins subsequently ratified Mr Taylor's actions as they were aware by 16 May 2007 that they were part of a larger action with other parties and continued to instruct T&W. They took the benefits of the shared costs arrangements. It is not now open for the Applicants to complain about that conduct.

Costs incurred "by" relevant conduct (step (ii) per Karwala ) 151No costs were incurred by the fact that the application named multiple applicants or because it included prayers for relief about validity as by April or May 2007, the Hutchins were aware of this. Had they requested a change to the structure of the proceedings so that they were sole applicants with a single issue, none of the costs subject of the current Notice of Motion would have been incurred. The Applicants have not discharged the onus of proving that any costs were wasted.

Discretion (step (iii) per Karwala ) 152If the Hutchins did not instruct Mr Taylor to include any validity claims and wanted to be the sole applicants, then Mr Taylor reasonably and honestly believed otherwise because of the following: what Mr Hutchins said to Mr Taylor on 18 December 2006, the fact that Mr Taylor was called by people whom he did not previously know evidently referred to him by Mr Hutchins, and what those people said to Mr Taylor. There is no evidence before the Court about this last matter because of privilege. However, these three matters taken together make Mr Taylor 's understanding explicable and honestly and reasonably held . Additionally, Mr Taylor was well intended and was acting to protect his clients' interests where he was unable to obtain advice from counsel because there was a pending expiry of a limitation period and it was before Christmas. The first ground of complaint does not warrant a wasted costs order and should be dismissed.

T&W Part 2 (1), (2), possibly (3) - j oining further parties and causes of action to the proceedings

(a) including the validity claims in the proceedings 153The same arguments made against the first particular are repeated. The Court should find that the Hutchins wished to pursue the validity arguments until at least April 2008. Their claim now that they were never interested should not be accepted as the Hutchins accept from at least May 2007 they were aware of the validity claims and were willing to proceed, considering it to be in their interests.

(b) the advice given about including the validity claims; (Part 2(1), (2)) 154There are no evidentiary bases for finding either that costs would have been lower had the Hutchins gone it alone or that T&W should have advised the Hutchins that costs would be lower if they went alone. 155The question of suffering from lost water is a non-legal matter and not a matter for advice from a solicitor. Further, this complaint proceeds on the assumption that the amalgamation claim succeeds. If the amalgamation claim fails, then no lost water will be retrieved and no prejudice will be suffered by a delay in retrieval. 156The real complaint is that the Applicants should have been advised that proceedings with other applicants and validity claims were "complex" and that the amalgamation claim could be decided more "swiftly" by itself. This complaint should be dismissed because there is no evidence before the Court about the advice given due to privilege. Other than Mr King's advice of 31 March 2007, advice was given on numerous other occasions; see Mr Archibald's affidavit and Mr Taylor's affidavit of 21 July 2010. 157Any suggestion that Mr Hutchins expressed concern about the amalgamation claim becoming "lost" in the proceedings before the mediation should be rejected. Mr Hutchins was specifically asked the earliest point when he raised such a concern and he answered by reference to the addition of the large group of new applicants in December 2007 (TS69.32 - 170.7). His subsequent attempt to change this evidence should not be accepted (TS240.49). Despite observing her husband talking to T&W on the telephone and at meetings, Mrs Hutchins gave no evidence of any complaint being made between 16 May 2007 and the mediation (or indeed at any time). Both Mr Taylor and Mr Archibald deny any such complaint was made. In the face of this conflict, the Court should give primacy to the only documentary evidence, which is Mr Hutchins' letter dated 4 April 2008 where he said "Our frustrations began at mediation". In response to this, Mr Hutchins said in cross-examination that before the mediation he was "reasonably happy to roll along". This was at a time he admits he knew the validity claims were in the proceedings with a number of other applicants. 158Without that evidence, the Court cannot be satisfied that there is nothing the lawyer could say, if unconstrained, to resist the wasted costs order. In any event, at the time, the Applicants wished to pursue the validity claims and would not have abandoned them if they had been advised that the amalgamation claim could be pursued more quickly. In cross-examination, Mr Hutchins admitted he knew the validity claims were in the proceedings with a number of other applicants. 159Further, the amalgamation claim is not simply a question of statutory construction, as advanced by the Applicants. Mr King gave evidence about other aspects of the claim. There is no basis to find that T&W should have advised them to abandon these other arguments, especially in light of the advice of possible avenues for claim by Mr King. Moreover, the Crown is resisting the claim as currently pleaded in the Supreme Court which includes administrative law questions and remedies, and that the Applicants were owed a common law duty of care. The Court cannot be satisfied that the amalgamation claim is simple or may be resolved more quickly. 160The complaint is based on the assumption that proceedings limited to the amalgamation claim could have been pursued more quickly than proceedings which also included the validity claims and multiple applicants. But the history of the claim suggests that until early 2008, the proceedings were conducted in a timely manner (see chronology). The Court achieved a relatively prompt mediation and listing for final hearing in April 2008. That the proceedings included validity claims and numerous applicants did not cause undue delay. The Court cannot be satisfied that proceedings limited to the amalgamation claim would have proceeded more quickly, or materially more quickly. The real delay in the case occurred in early 2008 when the hearing date was vacated. The evidence does not show why the April date was postponed to August, but the August date was postponed because of factors in other litigation. 161Even if the amalgamation claim had been run in isolation, there is no reason to suppose that the Court would have been willing to permit it to proceed whilst the validity of the whole regime was uncertain. 162Since 30 March 2007, T&W and Mr Taylor were entitled to act on counsel's advice especially in relation to matters of court procedure and litigation tactics. The Applicants make the same complaint of Mr King's advice which is tacit acceptance of Mr King's responsibility in that regard. There is no suggestion that T&W and Mr Taylor acted contrary to the advice of counsel.

Booth report 163In submissions, the Applicants attempted to expand the case by saying that additionally, T&W should have advised them that it was not in their interests to pursue the validity claims at all given the mathematical implications of the Booth report. This submission was not particularised and is misconceived. There is no basis for finding that there has been any serious neglect on the part of T&W and Mr Taylor arising from the advice given to the Applicants. Nor can the Court be satisfied that any costs have been incurred by any such advice. The Applicants have not proved that had they received some other advice, they would have acted differently and thereby avoided the costs now claimed.

(c) the addition of further applicants after December 2006 (Part 2(4)(b) - (d)) 164This complaint relates to the Court ordered addition of two applicants in April 2007 (Huggins and Rossatos) and the addition of a large number of applicants in December 2007 after the mediation and in April 2008. It does not further the Applicants' case. 165By 20 April 2007, the Hutchins were actively participating in the case with Mr Rossato attending a joint meeting with Mr Archibald, making a joint costs agreement and attending a conference with Mr King. Additionally, the Court should find that Mr Hutchins was given a draft POC on 13 April 2007, from which it was apparent that the Rossatos and the Huggins were parties to the proceedings. Mr Hutchins made no complaint about their addition. Also, by 16 May 2007, the Hutchins admit they were aware of the other applicants but were willing to proceed. In any event, as addressed above, the Hutchins subsequently ratified Mr Taylor's actions. Mr Hutchins did not inform Mr Taylor and Mr Archibald that they did not want other applicants in the proceedings. Further, no costs were incurred by the addition of applicants in April 2007. 166Even if, by April 2007 the Applicants still wanted to be sole applicants, Mr Taylor and Mr Archibald continued to believe otherwise for good reasons. Although the Hutchins were aware of the other parties, at no time did the Hutchins inform Mr Taylor and Mr Archibald that they did not want other applicants in the proceedings. For this reason, the Court in its discretion should not make a wasted costs order. 167After the mediation, Mr Taylor was of the view that the case would have to go to a final hearing and that it was in the Applicants' interest to have additional applicants share the costs more thinly. Between the mediation and December 2007, when a large group of new applicants were added, there were a number of communications between T&W and the Applicants. The limited evidence before the Court shows agreement by the Applicants, even if reluctant. There can be no suggestion that the co-applicants were added without the Hutchins' instructions. This is really a complaint about the adequacy of advice given, which is addressed above. However, because of privilege, the Court does not have the full evidence about what was said in those communications and as result, the Court cannot be satisfied that there has been any serious neglect or serious incompetence. 168The evidence also shows that the Hutchins understood the benefits of having a large group of applicants, including by sharing the risk of an adverse costs order in favour of the Crown. The Applicants were active in pursuing an indemnity to secure this benefit.

Causation (step (ii) per Karwala ) 169Additionally, the Applicants have failed to prove that any costs were incurred by the addition of further applicants in December 2007 and early 2008. No evidence was adduced and no analysis offered to make out this essential part of their case. 170In fact, logic suggests that the Applicants' costs were reduced by the addition of a large number of extra parties. The Court order of 6 November 2009 requiring that the Applicants pay the Crown's costs referable to their participation in the proceedings includes both the amalgamation and validity claims. Without the additional applicants, presumably the Applicants would have had to pay a higher proportion of these costs upon exiting the proceedings.

Discretion (step (iii) per Karwala ) 171For the reasons given above, the Court in its discretion should not make any order under s 99.

T&W Part 4/Part 5 - neglecting the conduct of the amalgamation claim in favour of the validity claims (now part of T&W Part 1) 172It is alleged that there was a failure to consider and advise on the effect of joining additional parties and whether the amalgamation claim should be split. The question of consideration of, and advice about, the joinder of extra parties is addressed above. The evidence is limited due to privilege. There is no serious neglect or serious incompetence. 173There is evidence that some consideration was given to splitting the amalgamation claim at a number of different times during the case, both before and after the mediation. There was no serious neglect or serious incompetence on the part of T&W and no evidence that any costs were incurred in any event.

T&W Part 6 - continuing to assert a retainer after it had been terminated (issue 9) 174The letter sent by Kell Moore dated 11 December 2008 (Part 6(2)) did not indicate that the retainer of T&W was terminated. As T&W were the solicitors on the Court record for the Applicants, they would continue to represent them until such time as they ceased to be applicants. It was understood that the letter established a new role for Kell Moore on top of that already being performed by T&W, a reasonable interpretation. Mr Williams appeared to have that understanding in the letter to the Crown dated 28 September 2009. 175The letter sent by Kell More dated 8 September 2009 (Part 6(3)) stating that T&W's retainer was terminated has to be understood in the context in which it was sent. T&W continued to be on the record for the applicants and still owed duties to the Court and the Applicants in that capacity, even after Kell Moore become the second solicitors on the record for the Applicants. This was an unusual situation which none of the solicitors who gave evidence had encountered before. The Crown was in communication with both Kell Moore and T&W. 176None of the three instances particularised in Part 6(4) during which it is alleged that T&W wrongfully asserted a retainer involved inaccurate or misleading communications. 177Firstly, Part 6(4)(a), the email dated 11 February 2009 from Mr Wolff to the CSO reflected the state of affairs at the time (see par 184(a) - (f) written submissions). No costs were wasted by the email in which T&W acted on the Applicants' behalf. 178Secondly, Part 6(4)(b) in a telephone call on 25 September 2009, Mr Taylor did not say anything misleading or inaccurate. Dr Galbraith made a file note which shows they discussed the "procedural mess" created by Kell Moore's notice of appearance. The Crown was in direct communication with Kell Moore and T&W. Nothing flows from this. 179Thirdly, Part 6(4)(c), in a telephone conversation on 29 September 2009, Mr Wolff and Dr Galbraith discussed the procedural mess caused by the documents filed by Kell Moore when T&W were still on the record for the Applicants . Dr Galbraith made a file note of that conversation. Any statement by Dr Galbraith or Mr Wolff about T&W's "retainer" should be understood in that light. They were not discussing the contractual relationship between T&W and the Applicants. I n any event, this conversation made no difference to him. Before the conversation, Dr Galbraith understood that he had to deal with Kell Moore in relation to the Applicants, whether it be the proposal put in the letter dated 17 April 2009 or the misjoinder motion filed on 24 August 2009. After the conversation, he had exactly the same understanding. 180These assertions are alleged in T&W Part 6(5) to give rise to delay by the CSO in providing an undertaking which was the basis for the Applicants discontinuing the proceedings. The absence of any link between wasted costs and the conversation in September 2009 is apparent from the way the Applicants put their case. For this complaint, the waste is said to arise from the Crown's delay in giving the undertaking (Part 6(5)) which was first sought on 23 January 2009, making it necessary for Kell Moore to file their misjoinder motion on 24 August 2009. This was cut back in closing submissions to the period from 24 August 2009 to the giving of the undertaking by the Crown on 6 November 2009. There is no conceivable way any delay can be linked to any conversation between the Crown and T&W in September 2009. This is apparent from the correspondence between Kell Moore and the Crown in exhibit 5. 181The Applicants have not proved that any costs were wasted by the conduct of T&W nor that T&W's conduct involved serious neglect or serious incompetence. A personal costs order is not warranted against T&W or Mr Taylor.

T&W Part 7 - failure to cooperate with the Applicants' new lawyers 182This complaint concerns the provision of information to Kell Moore in 2009 being access to the Court file and access to T&W's file. It is futile and should be abandoned following Mr Williams' evidence. Prior to 25 September 2009, the only deficiency in Kell Moore's knowledge of the proceedings was the fact that the Applicants were not the sole applicants. This was apparent from the application received by Kell Moore on 16 July 2008. 183Correspondence from Kell Moore to T&W dated 19 August 2009, 31 August 2009, 22 October 2009, 5 November 2009 and 13 November 2009 is particularised (Part 7(1). Responses from T&W were dated 23 October 2009 and 16 November 2009. T&W's file was requested two days before the misjoinder motion was filed and the affidavit in support signed on 21 August 2009. T&W did not accede to the request because of three complications: physical separation of the file was not a simple matter, the issue of privilege was complex as the other applicants were continuing their case against the Crown, and there were unbilled costs going back to 2008 which were to be shared amongst all the applicants. T&W advised on 23 October 2009 that consideration was being given to costs. Events overtook this process as costs orders were made on 6 November 2009. In the circumstances, T&W's conduct was reasonable. There was no serious neglect or serious incompetence and no costs were subsequently wasted. 184With regard to Kell Moore's request for authority to access the Court file made on 17 August 2009 (Part 7(2)), T&W gave authority 24 days later on 11 September 2009. The delay was explained by the need to consult with counsel regarding privilege issues for other clients in the proceedings. Mr Taylor told Kell Moore he was involved in High Court proceedings on 24 August 2009 which prevented him dealing with the access issue. Mr Taylor received advice from counsel shortly before 11 September 2009. However, the misjoinder motion had already been precipitously filed on 24 August 2009. In any event, the misjoinder motion would not have been filed if Kell Moore had regard to the application which they already had in the FOI documents . Any costs arising from this failure were not incurred by any neglect or incompetence of T&W.

Mr King's submissions 185After 11 days of hearing two out of three claims against Mr King were abandoned. King Part 2 was not pressed and Part 3 was abandoned save for that which is picked up by Part 1. 186There are fundamental differences between the claims made against T&W and Mr Taylor and those made against Mr King, which are important when the Court assesses his conduct. It is not part of the Applicants' case against Mr King that he knew or ought to have known that they were not interested in the validity claims or being part of a group action. Mr King was briefed in March 2007, after the application was filed in December 2006. At the time he was entitled to and did believe that the Applicants intended to be part of a group action in which all members pursued the validity claims and some had their own alternative claims (such as the amalgamation claim). The Court must consider Mr King's position at the relevant time, not with hindsight bias as the Applicants' case does.

Section 99 of the CP Act 187The jurisdiction to award costs against a practitioner is one to be exercised sparingly, with care and only in clear cases. As a general rule, allegations of breach of duty relating to the conduct of a case by a lawyer with a view to making a wasted costs order should be confined strictly to questions which are apt for summary disposal. It is a waste of court time and an abuse of process to use the wasted costs jurisdiction to run substantial satellite litigation as to the conduct of the practitioners. Section 99 is not a vehicle by which ordinary professional negligence claims by clients are pursued. Rather, it is concerned with when a lawyer has failed to fulfil his or her duty to a court and to realise his or her duty to aid in promoting in his or her own sphere the cause of justice: Harley v McDonald at 703; Medcalf v Mardell at [24] and Lemoto at [92] and [93] - [146], citing with approval Ridehalgh v Horsefield [1994] Ch 205 (at 238 - 239); see also Kelly v Jowett at [61] and Puruse at [45]. 188A fair hearing is required: Ridehalgh and Medcalf v Mardell , Lord Bingham at [22] (and other judges to similar effect throughout the judgments of the House). The court should not make any order against a practitioner precluded by privilege from advancing his full answer to the complaint made against him without satisfying itself that it is in all the circumstances fair to do so. The benefit of any doubt should fall to the lawyer. 189Courts have firmly discountenanced any suggestion that an applicant seeking a wasted costs order needs to prove anything less than they would have to prove in an action for negligence - that is, advice, acts or omissions in the course of professional work which no member of the profession who was reasonably well informed and competent would have given, done or omitted to do: Ridehalgh , followed and applied in relation to s 99 in Ideal Waterproofing at [14] - [17]; Whyked Pty Ltd v Yahoo!7 Pty Ltd [2008] NSWSC 477 at [14] - [19] and Puruse at [72]. Negligence of itself is not sufficient to ground the making of a costs order. Serious negligence or serious incompetence is required. The requirement that the negligence be "serious" has been repeatedly recognised, using descriptions of the same or similar kind. In Lemery Holdings Pty Limited v Reliance Financial Services Pty Ltd; School Holdings Pty Ltd v Dayroll Pty Ltd [2008] NSWSC 1114 at [72], Hammerschlag J referred to the notion of a "substantial omission", and in Myers v Elman (a case predating s 99 but one providing guidance in the field of costs orders against practitioners, for example Wentworth v Rogers [1999] NSWCA 403 and Lemery at [72]), Lord Wright referred to "gross neglect". In Bagley v Pinebelt Pty Ltd [2000] NSWSC 655 at [26] and Redowood v Goldstein Technology [2004] NSWSC 515 at [32], expressions such as "gross negligence" or "gross incompetence" were used. In Whyked , at [165] McDougall J spoke in terms of having to fall "so far short" of the requisite standards of diligence and competence that it amounted to serious neglect or serious incompetence. 190The lawyer's conduct must be judged having regard to the circumstances known to him or her at the time, that is, by the Court placing itself in the position of a lawyer, and not with the benefit of hindsight: M aurice Tarabay v Licha Bechara [2010] NSWSC 202 at [37] (Windeyer AJ). See also Whyked at [113]. 191T he applicant also has to prove that the lawyer's conduct has caused the costs the subject of the application to have been incurred: Leicester v Walton [1995] NSWCA 258 and Condor Asset Management Ltd v Excelsior Eastern Ltd [2006] NSWSC 510 at [11]. 192The Court retains a discretion as to whether or not to make an order under s 99. It has to be just in all the circumstances for an order to be made: Lemoto .

Privilege 193The application should be dismissed for the sole reason that the claims against Mr King cannot be upheld in circumstances where the existence of legal professional privilege and client confidentiality prevent the Court from receiving evidence as to all relevant events. 194As the substantive proceedings are ongoing and the co-applicants have not agreed to waive privilege, it was not possible for Mr King to put before this Court evidence of most of his instructions, his advice, and his thought processes. The Court is left to speculate: there is no basis upon which this Court can conclude that the instructions given to Mr King were such that no reasonably competent barrister in his position would have behaved in the manner complained of. The claim should fail for this reason alone.

King Part 1 - failure to advise that the amalgamation claim be litigated separately 195The Applicants allege that there were four matters which Mr King knew or ought to have known, and which should have led him to advise on a separation of the amalgamation claim from the validity claims. These are itemised in T&W Part 2(1). That claim should be dismissed for each of the following reasons.

(i) no submissions in support of the claim 196The Court has received no submissions as to why it should make the finding sought against Mr King. Rather than explaining why Mr King was seriously negligent or incompetent in failing to give a particular advice should be accepted, the Applicants repeat the allegation in the particulars.

(ii) no breach of duty to the Court 197It has not been pleaded or established that Mr King breached any duty to the Court. The alleged failure of Mr King cannot be said to have led to an interference or disruption in the administration of justice by the Court, thereby falling outside of s 99 of the CP Act.

(iii) no evidence of kind necessary to establish negligence 198The actual evidence put against Mr King was almost non-existent. The Applicants did not rely on any expert evidence of the kind usually proffered in cases where allegations of professional negligence are made. A report from an expert in the profession was not produced to the effect that no reasonably competent barrister could have acted in the manner complained of. The Applicants made no attempt to prove allegations of negligence (let alone serious negligence). Barrett J in Treadwell at [124] emphasised that the applicant bears a real evidentiary burden which it must satisfy to a high standard.

(iv) another barrister was instructed to consider this issue 199The Applicants have not identified any instruction given to Mr King to provide an advice on whether the amalgamation claim should be separated out from the validity claims. Rather, they instructed Mr Priestley in November 2007 to advise on this. His advice against the separation of the claims indicates that Mr King was not negligent as he was of the same view. Therefore, it cannot be contended that Mr King's conduct was the cause of any wasted costs after November 2007.

(v) failure to take account of many significant matters 200The claim is advanced on the nave basis that a decision about whether to have the amalgamation claim separately determined turned on whether it was a quicker and cheaper claim to run relative to the validity claims. In fact, there would be a range of other substantial matters that any reasonably competent barrister in Mr King's position would have taken into account such as the following: i)a barrister in the same position was entitled to believe that the Applicants wished to be part of a group action which advanced the validity claims and in which members had alternative individual claims; ii)the best claims for all the applicants were the validity claims: if they succeeded, the applicants would get more water than under the amalgamation claim (TS572.32 - 34, 574.14 - 21, 702.36 - 703.20 and 704.25 - 705.06); iii)it was the view of the lawyers for both parties and the Court that all the issues could be heard as early as April 2008; iv)the usual and conventional approach where a client has multiple claims in a matter is that all the claims be brought and heard in the one action for efficiency and cost effectiveness; v)the usual rule is that all issues should be tried together as separate determinations lead to unforeseen complications and delays. The perceived advantages of separate determinations often fail to materialise: Tepko Pty Ltd v Water Board [2001] HCA 19; (2001) 206 CLR 1 at [168] - [170]; vi)the amalgamation claim logically followed the validity claims because if the Plan was invalid, it did not matter how it was construed; vii)Mr King was entitled to understand that this was not a case where the prior determination of the amalgamation claim would result in the proceedings coming to an end as the validity claims were the Applicants' best claims in terms of potential outcome. One of the main reasons why separate determination is permitted would not be apparent to Mr King; viii)there were synergies between the amalgamation claim and the validity claims which would benefit the Applicants from running the two claims together; ix)the overlap between the claims weighed against the Court permitting one claim to be separated from the other; x)there was a real risk that if an application for an order for separate determination had been made it would have failed, resulting in costs orders against the Applicants; xi)even if the amalgamation claim was heard separately, that claim might have been dismissed resulting in costs orders. The risk of this outcome would be avoided if all claims were heard together (having regard to the applicants' cost sharing regime); xii)if the amalgamation claim was heard separately and failed, that would have weakened the Applicants' negotiating position moving forward; and xiii)the prospects of success of the claim to be separated is itself an important consideration. The evidence does not suggest that Mr King should have considered the Applicants' position to be strong in relation to the amalgamation claim, let alone so strong as to justify incurring the risks attendant upon its separation.

Pursue claim other than in the Land and Environment Court 201In closing address, the Applicants indicated that their claim against Mr King was not necessarily limited to a claim that he should have advised them to seek an order for separate determination of the amalgamation claim, but extended to a claim that he should have advised them to pursue the amalgamation claim elsewhere and to effect that by discontinuing their claims in the substantive proceedings. 202Most of the considerations listed in par 200 above arise equally where the question is whether to pursue the amalgamation claim elsewhere, possibly by discontinuing the proceedings. For example, considerations i) - iii), iv), vi), vii), ix), and xi) - xiii) are of direct relevance. In addition to those important considerations, however, is the fact that: (1) a discontinuance of the proceedings would have led to a costs order against the Applicants. It cannot seriously be suggested that Mr King was seriously negligent in not giving advice which, if accepted, would have produced this result; and (2) a barrister in Mr King's position was entitled to believe that the Applicants wished to pursue the validity claims. As such, the suggestion that he should have considered a possible discontinuance is fanciful. 203For the Applicants to succeed, they must establish not only that any reasonably competent barrister in Mr King's position would have advised them to pursue separation of their amalgamation claim but also that his departure from what any reasonably competent barrister would do was so substantial as properly to be characterised as "serious". No such expert evidence has been brought forward.

(vi) the limited underlying basis of the allegation was mere assertion 204The four matters raised in T&W Part 2(1) which are referred to in King Part 1, are not self-evident. The Applicants have not provided any detailed explanation of the full length and breadth of the legal and factual issues that would arise in a fully contested hearing of the amalgamation claim. There is, for example: (a)no evidence of the nature and extent of the documentary or affidavit evidence that would be required in order to properly make out the amalgamation claim; (b)no evidence of the nature and extent of the matters the Crown would seek to rely upon in resisting the claim; and (c)no evidence of the nature and extent of the evidence that would need to be considered and responded to in order to deal with those defences. 205The same submissions can be made in relation to the validity claims. It is not self-evident that it was more complex or time consuming. All matters were set down for four days of hearing in April 2008, later vacated: Mr King's oral evidence at TS716.25.

(vii) significance of the fact that separation may not have been permitted 206The Crown and the Court would have been reluctant to depart from the usual course of hearing all issues together. This is particularly so given the repeated judicial cautions against hiving issues off for separate determination, and the repeated judicial observations that experience has shown that the perceived advantages of separate determinations regularly fail to materialise and separation actually results in unforeseen delays, costs and inconvenience. 207First, the Applicants' allegation against Mr King appears to proceed on the unstated assumption that if an application for separate determination was made, it would have succeeded. Once it is accepted that such an application may have failed, the claim against Mr King is not maintainable because nothing turns on the fact that Mr King did not recommend that such an attempt be made. It is an allegation which, in a practical sense, runs into the sand at an early point. 208Second, the allegation is misconceived because there was a real risk that the application may have failed, exposing the Applicants to a costs order. It is absurd to suggest that Mr King was seriously negligent or seriously incompetent in acting in a way that protected the Applicants from this risk.

(viii) unfounded assumption that the amalgamation claim would succeed - T&W Part 2(1)(d) applied to King Part 1(1) 209There is no basis in the evidence for a conclusion that the amalgamation claim would succeed if hived off for separate determination. As such, the notion that Mr King's actions caused the Applicants to lose water is one which the Court cannot accept.

(ix) alleged triggers for the advice to be given - King Part 1(2), (3) 210The allegation that there were two events (the alleged conversation on 16 May 2007 and joinder of additional applicants) which should have triggered Mr King to advise the Applicants to separate out the amalgamation claim is misconceived for the following reasons. 211The alleged exchange on 16 May 2007 between Mr King and Mr and Mrs Hutchins (King Part 1(2) referring to T&W Part 2(3)(i)) was extremely brief (it must have been less than 10 or 15 seconds given its content). It is alleged in the letter of particulars to have been as follows (Mr Hutchins' affidavit dated 28 April 2010 at par 38): Hutchins: How do you represent the other parties who want the Water Sharing Plan overturned and us where our case depends on the Water Sharing Plan being held to be valid, in the one case? King: Don't worry about it, your case will be hived off and heard individually within the one case. 212Mr King's evidence is that there was no such exchange, and the discussion was about the procedural directions made on that day. 213The reasons why the conversation did not occur as alleged are as follows: (a)Mr Hutchins' evidence on the subject was internally inconsistent and illogical. He thought as at 16 May 2007 the validity claims were finished and it was the amalgamation or reliance claims before the Court for further directions: (TS309.21 - 49; 310.44 - 311.49; 312.31 -314.35). If that were so, he would never have had the conversation which proceeds on the basis that Mr Hutchins believed that the validity claims were continuing; (b)further, Mrs Hutchins' evidence lacked credibility having regard to the manner in which it was prepared (namely in concert with her husband). The submissions made for T&W and Mr Taylor on this subject are adopted; (c)the suggestion that there was a conversation in the terms the Hutchins alleged in their evidence does not sit with the objective facts. That Mr Hutchins was in a group action in which validity claims were being made by him and others was something well known to him prior to 16 May 2007, it had been openly discussed between him and T&W and Mr King, including on 13 April 2007. The submissions made by T&W and Mr Taylor in relation to the Hutchins' interest in the validity claims are adopted; and (d)Mr King's evidence as to the events of 16 May 2007 suffered from none of these vices. 214Even if the conversation had taken place as alleged, it would not be a conversation of any consequence to the question of whether any barrister in Mr King's position should have advised the Applicants to pursue an application for an order that the amalgamation claim be determined separately. Given the considerations set out in par 200 above, such a proposition cannot be supported. 215The second alleged trigger point was the time at which a large number of additional applicants were joined to the proceedings in late 2007 (King Part 1(1) and (3)). The particulars observe that Mr King's view was that the addition of further applicants would be a positive development as it would show a greater level of support for the validity claims. Their addition did not mean that the time it would take to prepare those claims for hearing would change as the validity claims turned on questions of the exercise of legislative power. There has been no evidence led to demonstrate otherwise. 216Further, the fact that there were more people advancing the validity claims did not mean that the considerations set out at par 200 above, relevant to whether to seek an order for separate determination of the amalgamation claims, were no longer matters to be taken into account. By late 2007, those considerations weighed heavily against separating out one claim because the Court and the parties were working towards a hearing of all the proceedings only several months later. It cannot be supported that a reasonably competent barrister in Mr King's position would have advised the Applicants to separate out the claim. 217Allegations based on the Booth report, which were not particularised, should not be allowed as an ambush in the proceedings.

(x) no causal connection between alleged conduct and costs 218Four categories of costs are sought in King Part 1 (identical to those specified in T&W Part 2) being costs of preparing the validity claims, of joining parties to proceedings in this Court, of the misjoinder motion, and of the Court order made on 6 November 2009 that the Applicants pay the Crown's costs. The costs claimed are not wasted costs for the purposes of s 99, as submitted for T&W and Mr Taylor. Nor has the necessary causal connection between the alleged conduct and the costs sought from Mr King been established. 219The allegation relating to the first category of costs fails. The Applicants incurred costs associated with the validity claims before Mr King was briefed in the matter so that he cannot have any liability for these costs. The allegation assumes that by advising the Applicants to separate the amalgamation claim, they would not have incurred any costs on the validity claims. This overlooks the following. The Applicants had an arrangement with co-applicants to share costs of the proceedings as a whole. An application for separate determination would have taken time to prepare and be heard and determined. If it succeeded, preparation of that claim would have taken time. In the interim, costs on the validity claims would continue to be incurred. If the application failed, costs on all issues would have been incurred. If the amalgamation claim was heard and failed, it is likely the Applicants would have elected to carry on the validity claims as their only remaining chance to obtain water. 220In relation to the second category, the assumption that if Mr King had advised the Applicants to pursue a separate hearing of the amalgamation claim they would not have been in the proceedings when additional parties were joined, has not been made out. 221The last two categories, concerning the costs and costs liabilities of discontinuing the Applicants' claims, overlook the fundamental circumstance that the proceedings were commenced before Mr King's involvement. He played no part in the Applicants becoming parties to the proceedings. This is an obvious defect in the Applicants' claims against him.

King Part 2 - pleading of the amalgamation claim - abandoned.

King Part 3 - neglecting the conduct of the amalgamation claim in favour of the validity claims 222King Part 3 referring to T&W Part 4 (no consideration or advice given of the effect of joining additional parties in proceedings in this Court on the prosecution of the Applicants' amalgamation claim) was abandoned. 223The claim that there was little or no discussion of the amalgamation claim at the mediation in September 2007 could not be made out because of the privilege of mediation. This was not ultimately relied on but demonstrates another aspect of the particulars that was doomed to fail. The remainder is a restatement of Part 1 and has already been addressed. 224Further there is no causal connection between the conduct complained of and the costs Mr King is said to be liable for.

Abuse of process 225The Notice of Motion should be dismissed in any event because it is an abuse of process. It has been pursued as a very substantial piece of satellite litigation, and in substance, a professional negligence suit run in a specialist planning and environment jurisdiction which does not ordinarily entertain matters of that kind. The Notice of Motion represents everything which the authorities establish a s 99 application should not.

Credit 226The Applicants made various submissions in relation to Mr King's credit, although there is only one conversation involving Mr King that has any direct bearing on the claims made against him. The submissions of T&W and Mr Taylor on (the lack of) credit of the Hutchins are adopted. Mr King's counsel made extensive submissions as to why his client's credit as a witness should be accepted in relation to the conference on 13 April 2007 (issue 4) and a conversation following a directions hearing on 16 May 2007 and 12 September 2007 (issue 7, but not an issue that is relevant to any of the claim particularised) (written submissions at par 8.1 - 8.26). As my reasoning in this matter does not require that I determine the issues of credit raised by the conflicting evidence of the Hutchins and Mr King, I will not summarise these submissions.

Authorities on wasted costs application 227All parties referred to Lemoto as containing relevant principles in relation to whether orders should be made under s 99. Lemoto considered s 198M of the Legal Profession Act 1987 (repealed) which provided for costs orders to be made against lawyers acting in matters without reasonable prospects of success, inter alia. After setting out at [84] - [91] the history of the jurisdiction to make costs orders against lawyers in English cases such as Myers v Elman and Orchard v South Eastern Electricity Board [1987] QB 565 , McColl JA ( Hodgson and Ipp JJA agreeing) at [92] set out seven guiding principles as follows: The new Division 5C [of the Legal Profession Act] should be construed against the background of the following principles which can be gleaned from the English and Australian authorities which have considered the power to order legal practitioners to pay the costs of proceedings in which they have represented parties: (a) The jurisdiction to order a legal practitioner to pay the costs of legal proceedings in respect of which he or she provided legal services must be exercised "with care and discretion and only in clear cases": Ridehalgh (at 229); Re Bendeich (No 2) (1994) FCR 422; Deputy Commissioner of Taxation v Levick (1999) 168 ALR 383 at 389 [11]; 43 ATR 621 at 627 [11] per Hill J; Levick v Deputy Commissioner of Taxation (2000) 102 FCR 155 at 166 [44]; Gitsham v Suncorp Metway Insurance Ltd [2002] QCA 416 at [8] per White J (with whom Davies and Williams JJA agreed); De Sousa v Minister for Immigration, Local Government and Ethnic Affairs (1993) 41 FCR 544; Money Tree Management Service Pty Ltd v Deputy Commissioner of Taxation (No 3) (2000) 45 ATR 262; (b) A legal representative is not to be held to have acted improperly, unreasonably or negligently simply because he or she acts for a party who pursues a claim or a defence which is plainly doomed to fail: Ridehalgh (at 233); Medcalf v Mardell [2003] 1 AC 120 at 143 [56] per Lord Hobhouse; White Industries (Qld) Pty Ltd v Flower & Hart (a firm) (1998) 156 ALR 169 (affirmed on appeal, Flower & Hart (a firm) v White Industries (Qld) Pty Ltd (1999) 87 FCR 137; Levick v Deputy Commissioner of Taxation ; cf Steindl Nominees Pty Ltd v Laghaifar [2003] 2 Qd R 683; (c) the legal practitioner is not "the judge of the credibility of the witnesses or the validity of the argument": Tombling v Universal Bulb Co Ltd [1951] 2 TLR 289 at 297; [1951] WN 247 at 238; the legal practitioner is not "the ultimate judge, and if he reasonably decides to believe his client, criticism cannot be directed to him": Myers v Elman (at 304, per Lord Atkin); Arundel Chiropractic Centre Pty Ltd v Deputy Commissioner of Taxation (2001) 179 ALR 406 at 413 [34]; 47 ATR 1 at 8 [34], per Callinan J; (d) A judge considering making a wasted costs order arising out of an advocate's conduct of court proceedings must make full allowance for the exigencies of acting in that environment; only when, with all allowances made, a legal practitioner's conduct of court proceedings is quite plainly unjustifiable can it be appropriate to make a wasted costs order: Ridehalgh (at 236, 237); (e) A legal practitioner against whom a claim for a costs order is made must have full and sufficient notice of the complaint and full and sufficient opportunity of answering it: Myers v Elman (at 318); Orchard v South Eastern Electricity Board (at 572); Ridehalgh (at 229); (f) Where a legal practitioner's ability to rebut the complaint is hampered by the duty of confidentiality to the client he or she should be given the benefit of the doubt: Orchard v South Eastern Electricity Board (at 572); Ridehalgh (at 229); in such circumstances "[t]he court should not make an order against a practitioner precluded by legal professional privilege from advancing his full answer to the complaint made against him without satisfying itself that it is in all the circumstances fair to do so": Medcalf (at 134 [23] per Lord Bingham of Cornhill); (g) The procedure to be followed in determining applications for wasted costs must be fair and "as simple and summary as fairness permits...[h]earings should be measured in hours, and not in days or weeks... Judges ... must be astute to control what threatens to become a new and costly form of satellite litigation": Ridehalgh (at 238 - 239); Harley v McDonald [2001] 2 AC 678 at 703 [50]; Medcalf (at 136 [24]). 228The legislative framework considered in Lemoto included repealed s 76C of the Supreme Court Act 1970 which enabled the court "to penalise a solicitor whose serious neglect, incompetence or misconduct delays proceedings ... by making orders for the payment of costs". That section preceded s 99 of the CP Act. 229In Ridehalgh (English Court of Appeal) Bingham MR, Rose and Waite LJJ considered s 51(6) of the Supreme Court Act 1981 (UK) which provided that "the court may disallow, or (as the case may be) order the legal or other representative concerned to meet, the whole of any wasted costs or such part of them as may be determined in accordance with rules of court". Section 51(7) defined "wasted costs" as any costs incurred by a party "as a result of any improper, unreasonable or negligent act or omission on the part of" a lawyer or "which, in the light of any such act or omission occurring after they were incurred, the court considers it is unreasonable to expect that party to pay." The court stated at 232 - 233: "Unreasonable" also means what it has been understood to mean in this context for at least half a century. The expression aptly describes conduct which is vexatious, designed to harass the other side rather than advance the resolution of the case, and it makes no difference that the conduct is the product of excessive zeal and not improper motive. But conduct cannot be described as unreasonable simply because it leads in the event to an unsuccessful result or because other more cautious legal representatives would have acted differently. The acid test is whether the conduct permits of a reasonable explanation. If so, the course adopted may be regarded as optimistic and as reflecting on a practitioner's judgment, but it is not unreasonable. The term "negligent" was the most controversial of the three. It was argued that the Act of 1990, in this context as in others, uses "negligent" as a term of art involving the well known ingredients of duty, breach, causation and damage. Therefore, it was said, conduct cannot be regarded as negligent unless it involves an actionable breach of the legal representative's duty to his own client, to whom alone a duty is owed. We reject this approach. (1) As already noted, the predecessor of the present Ord. 62, r. 11 made reference to "reasonable competence". That expression does not invoke technical concepts of the law of negligence. It seems to us inconceivable that by changing the language parliament intended to make it harder, rather than easier, for courts to make orders. (2) Since the applicant's right to a wasted costs order against a legal representative depends on showing that the latter is in breach of his duty to the court it makes no sense to superimpose a requirement under this head (but not in the case of impropriety or unreasonableness) that he is also in breach of his duty to his client. We cannot regard this as, in practical terms, a very live issue, since it requires some ingenuity to postulate a situation in which a legal representative causes the other side to incur unnecessary costs without at the same time running up unnecessary costs for his own side and so breaching the ordinary duty owed by a legal representative to his client. But for whatever importance it may have, we are clear that "negligent" should be understood in an untechnical way to denote failure to act with the competence reasonably to be expected of ordinary members of the profession. In adopting an untechnical approach to the meaning of negligence in this context, we would however wish firmly to discountenance any suggestion that an applicant for a wasted costs order under this head need prove anything less than he would have to prove in an action for negligence: "advice, acts or omissions in the course of their professional work which no member of the profession who was reasonably well-informed and competent would have given or done or omitted to do;" an error "such as no reasonably well-informed and competent member of that profession could have made;" see Saif Ali v. Sydney Mitchell & Co. [1980] A.C. 198, 218, 220, per Lord Diplock. 230Lemoto referred to Harley v McDonald at [50] - [51] (Privy Council appeal from New Zealand Court of Appeal) (Lord Hope, Lord Clyde, Lord Hobhouse, Lord Scott, and Dame Sian Elias): As a general rule allegations of breach of duty relating to the conduct of the case by a barrister or solicitor with a view to the making of a costs order should be confined strictly to questions which are apt for summary disposal by the court. Failures to appear, conduct which leads to an otherwise avoidable step in the proceedings or the prolongation of a hearing by gross repetition or extreme slowness in the presentation of evidence or argument are typical examples. The factual basis for the exercise of the jurisdiction in such circumstances is likely to be found in facts which are within judicial knowledge because the relevant events took place in court or are facts that can easily be verified. Wasting the time of the court or an abuse of its processes which results in excessive or unnecessary cost to litigants can thus be dealt with summarily on agreed facts or after a brief inquiry if the facts are not all agreed. Scope for the making of a costs order that will compensate as well as penalise is then likely to be found in making an order against the practitioner that will indemnify the opposing litigant against costs incurred as a result of the breach of duty that would otherwise not be recoverable. Circumstances which involve serious breaches of the practitioner's duty to the court may however raise questions about his duty to the client which involve allegations of professional misconduct. They may also raise questions as to whether the practitioner is liable in damages to the client for negligence. But it is not appropriate when considering whether or not to make a costs order for the court to rule upon whether, in addition to a breach of the duty to the court, there has been a breach of the rules of professional conduct. This is a matter which will ordinarily be dealt with by way of complaint under the disciplinary procedures of the 1982 Act. Nor is it appropriate for the court in exercising its summary jurisdiction to make a costs order to say whether the client has a cause of action against his barrister or solicitor for negligence. This is a matter which ought be dealt with in separate proceedings, in which the issues of fact and law between the client and the practitioner are clearly focused and the practitioner is given a full and fair opportunity to respond to the client's claim. 231These cases predate the introduction of s 99 of the CP Act (2005). Section 99 must be read in light of s 56(1) of CP Act which provides that the overriding purpose of the Act and rules is the just, quick and cheap resolution of the real issues in the proceedings and s 57 which identifies the objects of case management; see Puruse at [45] citing also Kendirjian v Ayoub and Lemery at [13] inter alia. This approach is confirmed in the most recent Court of Appeal authority to consider s 99, Kelly v Jowett . 232In Kelly v Jowett McColl JA (Beazley JA and Barrett J concurring) identified the statutory context for the consideration of costs under s 98 and s 99 of the CP Act. The Court's power to make an order for costs is expressly preserved in Pt 42 r 42.3(2)(g) of the UCPR. Her Honour noted at [56] that a court's power to order costs is in the exercise of its supervisory jurisdiction over its own officers which reflects English authority which confirmed that ancient jurisdiction of a court. At [57] her Honour stated: The Court's power to make costs orders in respect of a legal practitioner has, as the discussion to which I will shortly turn demonstrates, always been exercised to ensure legal practitioners observe their duty to the Court and, in turn, to the administration of justice, to ensure among other obligations the expeditious and efficient conduct of litigation. Those obligations now find express reflection in s 56(1) and s 56(3) of the Civil Procedure Act in requiring parties to civil proceedings to assist the Court to further the just, quick and cheap resolution of the real issues in the proceedings and directing that "[a] solicitor ... must not, by his or her conduct, cause his or her client to be put in breach of the duty identified in subsection (3)": s 56(4). 233At [ 60] - [62] her Honour stated: The jurisdiction to make costs orders against legal practitioners referred to in s 99 of the Civil Procedure Act and r 42.3(2)(g), now commonly referred to as the "wasted costs" jurisdiction, must be exercised "with care and discretion and only in clear cases": Lemoto v Able Technical Pty Ltd (2005) 63 NSWLR 300 at 320 92 per McColl JA (Hodgson JA and Ipp JA agreeing). In exercising the jurisdiction, however, the Court takes into consideration the public interest reflected in the legislative provisions to which I have referred, that litigants should not be financially prejudiced by the unjustifiable conduct of litigation by their or their opponent's lawyers: Ridehalgh v Horsfield [1994] Ch 205. It is the public interest in the administration of justice which is the source of duties that lawyers owe to the court: Rondel v Worsley [1969] 1 AC 191 at 227 per Lord Reid. The wasted costs jurisdiction is based on the court's right and duty to supervise the conduct of its solicitors: Myers v Elman , per Lord Atkin (at 302), per Lord Wright (at 318-319), per Lord Porter (at 334-336). The underlying principle is that the court has a right and a duty to supervise the conduct of its solicitors, and visit with penalties any conduct of a solicitor which is of such a nature as to tend to defeat justice in the very cause in which the solicitor is engaged professionally. The jurisdiction is exercised where it is demonstrated that the solicitor has failed to fulfil his or her duty to the Court and to realise his or her duty to aid in promoting in his own sphere the cause of justice. The order is for payment of costs thrown away or lost because of the conduct complained of and is frequently exercised in order to compensate the opposite party in the action: Myers v Elman per Lord Wright (at 319); see also Sydney South West Area Health Service v Stamoulis [2009] NSWCA 153 (at [204]) per Ipp JA (Beazley JA and Giles JA relevantly agreeing). The history of the wasted costs jurisdiction was discussed in Lemoto (at 318 [83] and following). As can be seen from that discussion many of the principles were explained in the seminal decision of Myers v Elman which makes it clear that the object of the wasted costs jurisdiction is to protect the client who has suffered and to indemnify the party who has been injured. Misconduct or default or negligence in the course of the proceedings is in some cases sufficient to justify an order: Myers v Elman (at 289) per Viscount Maugham, Lord Russell of Killowen (at 307) and Lord Porter (at 334) agreeing. 234The terms serious neglect and serious incompetence are not defined in the CP Act. The Applicants are not alleging serious misconduct. At [14] - [17] Sully J in Ideal Waterproofing considered these terms in relation to s 99 and applied the meaning of these terms from Ridehalgh set out above in par 229. 235Sully J at [18] also applied a further principle referred to in GE Dal Pont, Lawyers' Professional Responsibility in Australia and New Zealand , 2nd ed (2001) LBC Information Services at 374 - 375 which states that the jurisdiction to order costs against a lawyer personally is to be exercised sparingly because, among other things, it is difficult for a court to know all the details and circumstances of the lawyer's instructions. The jurisdiction does not arise because of a lawyer's bona fide mistake or error of judgment . The conduct must involve some serious dereliction of duty or gross negligence. At [19] Sully J also applied from Harley v McDonald [1999] NZLR 545 (New Zealand Court of Appeal) at [59] - [61] the principle that officers of the court are expected to behave with a certain level of competence and care and if in serious dereliction of such duty, officers are amenable to the costs jurisdiction of the court. In that case it was not considered necessary or desirable to attempt to define the level of incompetence or negligence required for the jurisdiction to arise. 236Windeyer J in Karwala at [10] and McDougall J in Whyked at [18] expressed caution in applying the views in Harley which concerned the inherent jurisdiction of the New Zealand Court of Appeal to order costs against lawyers. Windeyer J did not think that decision relevant to a case concerning statutory jurisdiction such as s 99(1) which is independent of the requirements for professional conduct. As highlighted in Whyked , s 99 is not framed by reference to a test of serious dereliction favoured by the New Zealand Court of Appeal . The approach of Sully J was nevertheless applied in both cases and his considerations and principles all need to be borne in mind in this matter. Lemery at [72] referred to Ideal Waterproofing and Ridehalgh in relation to the meaning of serious neglect in s 99 as a substantial omission which no member of the legal profession who was reasonably well informed and competent would have omitted to do. 237There are relatively few decisions under s 99 of the CP Act in the Supreme Court and this Court it would appear, based on a table provided by Mr Taylor's counsel of 20 such cases decided since 2005. Orders under s 99 in favour of the opposing party were made in only four cases. As identified by Mr Taylor's counsel (par 127) there is no case where this Court or the Supreme Court has made an order under s 99 requiring a lawyer to compensate his or her client. Four cases, Ideal Waterproofing , Holmes , Dubow and European Hire Cars , are identified where clients have sought costs from their lawyer or former lawyer under s 99, all unsuccessfully. 238The costs sought under s 99 are the Applicants' costs of the misjoinder motion, indemnification for the costs ordered by the Court to be paid on 6 November 2009 (the Crown's costs) and reimbursement for all fees paid to the Respondents in relation to whole or part of the proceedings. Section 99(2)(a) provides that a court may disallow the whole or part of costs in proceedings as between a barrister and client and as between a solicitor and client. The claim for reimbursement of costs paid to T&W and Mr Taylor is presumably under this subsection. Section 99(2)(b) provides that a court may direct a solicitor or barrister to pay a client the whole or part of any costs the client has been ordered to pay to another person (here the Crown's costs of the misjoinder motion and subsequent discontinuance by the Applicants). Under s 99(2)(c) a court can also direct a lawyer to indemnify any party not his or her client against costs payable by that party. That subsection is not relevant to this application.

Whether s 99 claim appropriate 239The primary submission of the Applicants is that s 99 is broadly worded, provides for payment by a lawyer to his or her client and can therefore encompass the circumstances complained of. The Applicants relied on the principles in Lemoto and Kelly v Jowett . That approach fails to recognise the limits on matters which can be brought under s 99 identified in those authorities. I have the benefit of very detailed and thorough submissions on the application of relevant legal principles to consider in relation to s 99 from the Respondents and I largely agree with these, as will become clear in the following discussion. 240Threshold issues arise of whether the costs claimed by the Applicants can properly be claimed in reliance on s 99 in light of the authorities above.

(i) professional negligence claims impermissible 241The Applicants' case alleges serious neglect or serious incompetence based on an alleged breach of the solicitor's retainer held by T&W. It does not appear that a direct retainer was held by Mr King from the Applicants. The Applicants submitted that while professional negligence claims are not brought under s 99, the terms of s 99(1) are broad and can and should apply in this case. The Applicants' case had a number of hallmarks of a professional negligence claim. The Applicants' written submissions opened with a lengthy explanation of the relevant law relating to the allocation of water licences historically and under current legislation. This is briefly summarised above in par 70 - 72. The first page and a bit of the chronology also refers from 28 February 1997 to the retirement of Mr MacFarlane in November/December 2006 and recites actions taken by the Applicants and lawyers other than T&W in relation to water licences and entitlements under the Water Act and the WM Act. While those entries have been included in the judgment because it was part of the agreed document provided, these events are completely separate from these proceedings from which the Applicants withdrew. 242The only relevant purpose for this level of detail about the substantive legal issues and earlier events predating these proceedings is if the Court is being asked to assess the correctness and prospects of success of the Applicants' legal claim in the substantive proceedings in order to assess whether there has been serious neglect or serious incompetence. That is not the appropriate role of the Court in these essentially interim costs proceedings for at least three reasons. Firstly, there has been no determination of the legal issues in any substantive proceedings following a final hearing to crystallise an "event" for costs purposes. For the general caution against courts determining substantive issues for the purposes of having an "event" by which to assess costs, see Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin [1997] HCA 6; (1997) 186 CLR 622 at 624 . This caution applies to a claim for costs brought under s 99 as well as other costs provisions. That the Applicants chose to withdraw from the substantive proceedings is not indicative of the likely legal outcome of these proceedings. 243Secondly, allied to the Notice of Motion essentially raising a professional negligence claim, the particulars relied on (T&W Part 2(1), (2); King Part 1(1), (2)) require the Court to come to its own conclusion that the validity claims were complex and time consuming, that the amalgamation claim was simple and could be dealt with more swiftly than the validity claims and would succeed so that the longer the resolution the more water was lost, in order to make a finding of negligence or incompetence. None of these matters is self-evident, able to be confirmed by reading correspondence sent by a former solicitor of the Applicants, Mr MacFarlane, in October to November 2006 to the Department or anything since. Reading the pleading in this Court and in the Supreme Court proceedings commenced on 19 November 2009 does not enable any definitive view to be formed about these matters. No evidence has otherwise been called by the Applicants to establish these matters. As a result I am not able to draw any conclusion in relation to these particularised matters so that any claim based on these particulars in relation to T&W, Mr Taylor and Mr King cannot succeed. The impermissible assumption underlying important parts of the Applicants' case is that their claim will succeed. The submissions of T&W and Mr Taylor at par 160 - 162 to that effect are accepted. 244The further particular specified in T&W Part 2(1)(b) and King Part 1(1) is that joinder of further parties would increase costs. That is also not a self-evidently correct statement. One of the benefits of having multiple applicants is that costs can be shared, a matter known to the Applicants. This was a matter put to Mr Hutchins by the Respondents' counsel (TS244.20 - 246.41) and is reflected in action taken by him through T&W to ensure an indemnity for costs was obtained from other applicants. It is not a matter about which I need come to a firm conclusion. The Applicants have the onus of establishing their case and cannot do so in relation to this aspect given the lack of evidence on costs before me. 245Thirdly, the nature of professional negligence claims are markedly different from a wasted costs application relying on s 99. As identified by counsel for T&W and Mr Taylor, a professional negligence claim must identify with precision various matters such as the standard of duty owed by a lawyer in the particular circumstances (par 127). None of these important matters have been identified as part of the Applicants' case. The Applicants' case lacks evidentiary support such as expert evidence of usual practice to establish the alleged professional shortcomings of the Respondents and how any standard of care owed has been breached. While this may not be essential, as the Applicants' counsel submitted, given the nature of this matter as essentially a professional indemnity claim, it is another matter of concern. No articulation of the standard of care required of the Respondents was specified beyond broad generalities. In short, it is not enough for the Applicants to succeed under s 99 to say look at the broad terms of s 99(1) and (2).

(ii) no wasted costs demonstrated 246As Kelly v Jowett most recently identified, the purpose of s 99 in the CP Act is to enable the Court to supervise lawyers who fail in their duty to the Court in the conduct of litigation to which the CP Act is directed. The section is not intended to apply to claims which may arise between a client and solicitor and/or barrister which falls outside the CP Act framework. 247Focussing on the claim against T&W and Mr Taylor, their counsel submitted this is not a wasted costs application but a professional negligence claim erroneously commenced under s 99 of the CP Act as it is not alleged that (par 44 - 46 written submissions): (a)the solicitors breached any duty they owed to the Court; or (b)the solicitors caused the Applicants to breach any duty they owed to the Court : see s 56(4) CP Act; or (c)the Applicants breached any duty owed to the Court: see s 56(3) CP Act; or (d)any order of the Court was breached; or (e)any Court time was wasted, or any costs were incurred in relation to any such waste of Court time; or (f)any time was wasted by the Crown, or that any costs were wasted by the Crown, this issue is addressed further below; or (g)there was any delay in the conduct of the substantive proceedings; or (h)it is not alleged that any public resources have been wasted. 248Circumstances such as those identified above at (b) - (h) are not particularised in the Applicants' case but reflect the kinds of conduct the Supreme Court and this Court have considered in relation to claims for costs under s 99. As submitted by T&W and Mr Taylor an order under s 99 is intended to address the situation where a litigant incurs costs in the conduct of proceedings which should not have been incurred had the lawyers performed their duty to the Court. Examples include costs of the opposing party wasted upon the late vacation of a hearing date, as in Kendirjian v Ayoub , costs wasted upon an unnecessary attendance before the Court, as in Puruse , or costs incurred by an opposing litigant where a futile claim has been made may justify an order under the wasted costs jurisdiction as in Holmes . In such cases the waste of the public resource of the Court's time is evident. It is also important to note that the beneficiary of a wasted costs order is generally the opposing party. Mr King made similar submissions summarised in par 187 and I adopt these submissions, based on the authorities there cited. 249In oral submissions the Applicants' counsel made the broad submission that the failure of a lawyer to properly act on his or her instructions gives rise to a failure of the lawyer's duty owed to a court, par 247(a) above. No authority for this was cited. A key issue therefore is whether the failure to properly implement instructions given to a lawyer (assuming this can be established) which does not give rise to any wasted costs in the manner in which the court proceedings are run can give rise to an application for costs under s 99. The authorities referred to at par 227 - 233 suggest not. Contrary to the Applicants' counsel's submission (par 110) that this case is not attempting to break new ground in relation to s 99, I consider that it is seeking to do so. The key matter raised by this submission is whether a claim essentially alleging professional negligence in relation to the duty owed by a lawyer to his or her client in the actual commencement of court proceedings which are then otherwise properly run can give rise to a costs order under s 99. 250It is necessary to be clear about the circumstances in this case because I perceive that it is an unusual application in the context of s 99, unlike any of the cases which have considered s 99 to date. The evidence which will be discussed to a limited extent below in relation to the particulars concerning the initial instructions given to Mr Taylor and T&W does not establish that proceedings were commenced without any authority being held by Mr Taylor and T&W for the Applicants. I am not therefore considering the hopefully unusual case of a lawyer who engages in court action without any proper retainer to act but who otherwise conducts litigation without unnecessary costs being incurred (and observe that whether that would be able to be raised in an application for costs under s 99 is left for another day). 251There is no evidence adduced by the Applicants of how any failure to comply with the alleged retainer by T&W (assuming there is such a failure) resulted in the wasting of Court time and/or caused other parties to incur wasted, in the sense of unnecessary, costs. The broad submission made by the Applicants is that because of the failure to implement their instructions to pursue only the amalgamation claim and without instructions to join with other co-applicants, their costs have been wasted. In terms of the day to day conduct of the proceedings there is no evidence before me suggesting there was any failure on the part of T&W to properly pursue the proceedings, such as occurred in Lemery and Puruse , of failing to comply with particular Court orders which resulted in wasted costs to the Applicants or the opposing party. There is virtually no evidence about court processes at all before me. No dispute about these is raised. At the broader level of whether the proceedings have been delayed and should have been finalised by now, the substantive proceedings in this Court are still pending, the original hearing in April 2008 of four days having been vacated. The Supreme Court proceedings commenced by the Applicants' current solicitors in November 2009 are also pending. It is not self-evident that there has been delay in the substantive proceedings justifying a claim under s 99. 252The same observations also apply to Mr King with the further observation that he was not retained directly by the Applicants but through T&W. How the Applicants' counsel's submission that a breach of retainer gives rise to a breach of duty owed to a court applies to Mr King was not fully explored before me. In accordance with usual legal practice, Mr King was retained by T&W to advise on certain matters and appear in Court so that the breach of any retainer must of necessity be different in his case, presumably that he breached the retainer with T&W. The Applicants have not pleaded or argued the case against Mr King in this way. The particulars alleged against him rely heavily on those against T&W and Mr Taylor. This suggests that the case under s 99 against Mr King on the basis of a breach of retainer is even less tenable than against T&W. No breach of duty by Mr King to the Court appears to be raised by the Applicants' case against him. These matters all suggest that there is no basis for a claim pursuant to s 99 in relation to the Respondents. 253That the Applicants incurred liability for the Crown's costs when they withdrew from the proceedings in this Court are not wasted costs for the purposes of s 99, meaning unnecessarily incurred as a result of the serious neglect or serious incompetence of a lawyer. They are the cost to the Applicants of deciding to withdraw from the substantive proceedings. While the Applicants would no doubt prefer not to be liable for these costs given that they are pursuing their amalgamation claim in the Supreme Court, these are not wasted costs as referred to in the authorities considering s 99. 254As highlighted by the Respondents' submissions noted above in par 237, no cases in the Supreme Court or this Court have awarded costs under s 99 to a client resulting from a breach of retainer by his or her solicitors. The orders made are generally in favour of an opposing party who has incurred costs as a result of the actions of the other party's lawyers which have fallen under s 99 (previously s 76C of the Supreme Court Act). As submissions for T&W and Mr Taylor identify, without s 99 an opposing party has no ability to recover costs wasted as a result of the conduct of the other party's lawyer.

(iii) lengthy costs application under s 99 should be discouraged 255Another reason to question whether actions which are essentially professional negligence claims should be considered under s 99 is that lengthy litigation in relation to wasted costs applications is discouraged, Lemoto at [92(g)]. In keeping with the principles in s 56 of the CP Act for the just, quick and cheap disposal of proceedings, emphasised in Kelly v Jowett at [57] , any costs litigation should be as short as possible. Originally set down for five days, this matter eventually ran for twelve days, a matter of considerable regret to me as the presiding judge in failing to better contain the length of the hearing. This has resulted in a "new and costly form of satellite litigation": Lemoto at [92(g)] quoting Ridehalgh , Harley v McDonald and Medcalf v Mardell . It is very likely that this period of hearing will exceed the hearing time of the substantive proceedings in which the Applicants were originally parties. I note these were originally set down with multiple issues and multiple parties for four days in April 2008 before that date was vacated. 256Lengthy litigation about costs under s 99 where there has been no outcome of the issues in the substantive proceedings to guide a court's consideration of the appropriate costs outcome if that be necessary is to be discouraged. As identified in Ridehalgh cited in Lemoto , wasted costs are generally considered where the presiding judge will be aware of all the relevant evidence, which is likely to be of short compass, and does not require lengthy consideration of disputed facts to determine the outcome as the relevant evidence will be largely known to the court. Here many days were spent on evidence about events which occurred outside the court process and could not therefore be known to me as the presiding judge. The conduct particularised by the Applicants is removed from the scope of s 99 as it concerns actions which took place outside the court process and there is no evidence of any wasted costs for either the Applicants or the opposing parties in the substantive proceedings as a result.

Legal professional privilege 257The Respondents relied on authority which identifies that caution is required where legal professional privilege prevents a lawyer from providing complete evidence of his or her defence to a claim (see par 131 - 132, and 188 above). This is important in this matter because of the unusual circumstance that the substantive proceedings are ongoing before this Court. I made a ruling before the hearing in Hutchins Pastoral Company Pty Ltd v Minister Administering the Water Management Act 2000 [2010] NSWLEC 30 and during the hearing in Hutchins Pastoral Company Pty Ltd v Minister Administering the Water Management Act 2000 (No 2) [2010] NSWLEC 241 that legal professional privilege prevented much of the evidence prepared by the Applicants being read. The material included advice to third parties not before me who continue to pursue the substantive proceedings and who had not waived privilege. As all Respondents submitted, a fair hearing is required so that where a lawyer cannot advance his or her full answer due to privileged material being unavailable he or she should get the benefit of the doubt. This is supported by Lemoto at [92(f)], referring to Orchard , Ridehalgh , and Medcalf v Mardell . 258That consideration is relevant in this case for the reasons identified in the previous paragraph. That disadvantage was not able to be overcome by the Respondents, contrary to the submission of the Applicants' counsel that it was possible to obtain the necessary evidence by putting matters solely referable to the Applicants to a particular witness. There were numerous occasions during the hearing when privileged information was not able to be divulged by the Respondents in response to the Applicants' case. The Court was not able to be fully apprised of all the advice given to the Applicants including in the context of other applicants in the substantive proceedings by all Respondents for that reason. For example, the Court did not have before it the whole of Mr King's advice dated 31 March 2007 as that related to all the applicants in the substantive proceedings. 259As submitted by Mr King's counsel (par 194), as a result of that important gap in evidence there is no basis for the Court to assess whether a reasonably competent barrister would have behaved in the manner complained of and the Court should not speculate on such matters. Similar submissions were made by T&W and Mr Taylor's counsel (par 132) in relation to the solicitors' conduct. I consider these submissions are correct. 260These various findings suggest that the Notice of Motion should fail at the threshold. Given the lengthy hearing and the large number of matters raised I will consider some of the specific matters identified in the course of the lengthy hearing. In particular, as indicated in par 250, I will consider the particulars relevant to the Applicants' claim framed as a breach of the solicitor's retainer concerning the commencement of proceedings. Not all issues raised need be resolved.

Applicable principles assuming s 99 claim maintainable 261On the assumption that some parts of the Applicants' claim can be considered, the Respondents submitted and I accept that the onus of proof to justify a costs order being made under s 99 lies on an applicant: Karwala at [9] and Ideal Waterproofing at [25]. The civil standard of proof (balance of probabilities) applies: Ideal Waterproofing at [25]. 262I also accept the submission for T&W and Mr Taylor that an allegation under s 99 is a grave matter and the principles in Briginshaw v Briginshaw apply; Karwala at [9] as reflected in s 140(2) of the Evidence Act 1995. When considering whether it is satisfied on the balance of probabilities, the Court is to take into account the nature of the subject matter of the proceedings and the gravity of the matters alleged. Given the serious nature of the allegations made, the Court's reasonable satisfaction of the matters alleged "should not be produced by inexact proofs, indefinite testimony, or indirect references", Ideal Waterproofing at [25]. Also Barrett J in Treadwell at [124] refers to the real evidentiary burden on an applicant to establish necessary facts to a high standard. I also adopt Mr King's submission at par 189 on the substantial requirements on the Applicants to prove serious neglect or serious incompetence. 263To the extent that wasted costs orders are made at all, the cases emphasise they are not lightly made. Counsel for T&W and Mr Taylor submitted that a proper approach to the determination of an application under s 99 is to adopt a three stage enquiry per Karwala at [7] and Ideal Waterproofing at [13]: (i) has there been serious neglect, serious incompetence or serious misconduct by the lawyer? (ii) if so, did that conduct cause the applicant to incur unnecessary costs? (iii) if so, is it, in all the circumstances, just to order the lawyer to compensate the applicant for the whole or any part of the relevant costs? These enquiries are derived from Ridehalgh with changes made in relation to the wording in step (i) to reflect the terms of the CP Act. 264The Applicants did not disagree with these steps being applied subject to the rider that unnecessary costs must be those incurred by the serious neglect or serious incompetence of the lawyers as referred to in step (ii) in Karwala (see par 119 above). The Respondents' submissions reflected the consideration of these three questions. 265As identified above in the authorities, the meanings of "negligence" and "unreasonable" inter alia identified in Ridehalgh have been applied since the introduction of s 99 in cases such as Ideal Waterproofing at [226] and Lemery at [72]. As submitted by Mr Taylor and T&W (par 128) gross negligence is required for the term "serious neglect". There has been less consideration of the meaning of seriously incompetent in the authorities quoted and the parties' submissions did not distinguish this from serious negligence. The terms can be considered together in this case. 266The Respondents submit, correctly, that the actions of lawyers must be judged by the circumstances as they existed, not with the benefit of hindsight, relying on Whyked at [113] inter alia.

Particulars necessary 267Because the action requires for its success that the Court make findings of serious neglect or serious incompetence it is important that the claim be properly particularised so that the Respondents can know the case against them; Lemoto at [92(e)] referring to Myers v Elman , Orchard and Ridehalgh . Those matters which the Applicants sought to rely on for the first time at the hearing and about which no notice was given before the proceedings, notably the Booth report, cannot be part of the Applicants' case. The matters in this category are identified above at par 137 of T&W and Mr Taylor's submissions. To allow these matters to be pursued would be unfair to the Respondents who prepared their case on the basis of the lengthy particulars provided. Given the lengthy hearing time occupied by dealing with the claim as particularised, the necessity to particularise the case a respondent must meet is also important to enable proceedings to proceed in an orderly and timely fashion. 268A further reason in this matter of why particulars are important is because, as T&W and Mr Taylor submitted, the course of conduct the subject of the proceedings took place over many years. To bring forward evidence about every interaction between the parties in that period just in case further matters were raised at the hearing, as the Applicants attempted to do, would be onerous and would have prolonged the litigation even further. The Booth report will not be considered. While the Applicants submitted this was evidence brought forward by the Respondents and they were simply responding to that, more notice of their intention to do so should have been provided if they intended to take this course. Further, the final submission of the Applicants' counsel that advice should have been given to pursue the Applicants' claim other than in this Court was not particularised. 269It is necessary to focus on the particulars provided (at par 6) as these identify the case the Applicants seek to make. In light of my finding that this case appears to fall outside s 99, it is not strictly necessary to address all the particulars or review all the evidence and this will be done to a limited extent. Nine issues of disputed fact are identified in the Applicants' counsel's written submissions (see par 74 - 94 above) as arising in the evidence as between the Applicants and the Respondents. 270I was asked to make a number of findings on the credit of those giving evidence. I am reluctant to do so as it is not absolutely necessary for the resolution of this matter and such a finding must fall adversely on at least one of the parties.

T&W Part 1 - commencing proceedings in manner inconsistent with instructions/

T&W Part 4(3) - neglecting conduct of amalgamation claim 271The most serious allegation made in relation to the allegation of a breach of the solicitor's retainer is that the proceedings were commenced on behalf of the Applicants with other parties (Commins Partnership Pty Ltd, NA & J Investments Pty Ltd) and that claims other than the amalgamation claim were pursued contrary to or in the absence of the Applicants' instructions. The claim as particularised (Part 1(1)) is that in December 2006 Mr Hutchins approached Mr Taylor about an action concerning the application of water entitlements under r 10 appendix 4 of the Plan and gave instructions that Mr Taylor advise him about that amalgamation claim and act on his behalf in relation to it. Part 1(2) is that the summons commencing proceedings did not seek remedies in relation to the amalgamation claim but did seek remedies in relation to the validity of the Plan. Part 1(3) is that no instructions were given to commence the proceedings with other parties. Part 1(4) which is related to (2) states that instructions were not given to commence proceedings which did not include the amalgamation claim. Part 1(5) is that the Applicants did not give instructions for proceedings to be commenced in relation to the validity claims. This conduct is said to be serious neglect or serious incompetence resulting in costs being incurred because an action was commenced which was not authorised which resulted in the Applicants having to extricate themselves from the proceedings, incurring unnecessary costs in doing so. 272In relation to Part 1(2) and (4), the application filed by T&W on 22 December 2006 sought relief in wide terms. The relief sought was sufficiently broad that the amalgamation claim could fall within it. Mr Taylor's evidence is that the Class 4 application was drafted following discussion with Mr Taylor SC. As submitted for T&W and Mr Taylor, court proceedings were commenced in relation to the amalgamation claim which it is not disputed was within the instructions of Mr Hutchins. As also submitted the POC prepared subsequently by Mr King in the first half of 2007 included the amalgamation claim so that this claim was clearly identified from the outset of proceedings. There is no basis established for serious neglect or serious incompetence based on these two particulars. 273Disputed factual issues 1, 2 and 3 all raise what occurred as between Mr Taylor, other employees of T&W and the Applicants in the lead up to the commencement of Class 4 proceedings on 22 December 2006 in relation to the joinder of other parties and the inclusion of other issues such as the validity claims. The disputed matters are referred to in the chronology at November 2006, 5 December 2006 and before or on 22 December 2006. Substantial evidence of Mr and Mrs Hutchins and Mr Taylor in affidavit and oral form was adduced in relation to what occurred from the time Mr Hutchins first approached Mr Taylor (that date being disputed, see chronology at November 2006 where Mr Taylor states that was when he was first approached) to the commencement of proceedings. The Applicants maintain they wished only to pursue the amalgamation claim and did not give instructions to commence any other claims such as challenging the validity of the Plan, or to join with any other parties. 274Mr and Mrs Hutchins met with Mr Taylor on 5 December 2006 (adopting the Hutchins' evidence of the date of that meeting) and faxed material to T&W on 6 December and 18 December 2006. There is disagreement between the evidence of Mr Hutchins and Mr Taylor as to what was said on 18 December 2006 in particular. By way of corroboration the Applicants rely on the content of the material sent by facsimile to Mr Hutchins to Mr Taylor and Mr Archibald which related to an amalgamation claim only. There were discussions on 18 December 2006, a filing fee was paid by the Applicants on 20 December 2006 and Class 4 proceedings were commenced on 22 December 2006. The haste was because of Mr Taylor's belief that proceedings had to be commenced on or by 23 December 2006 in order to comply with a relevant statutory limitation period under the WM Act for challenges to the Plan. 275The Applicants submitted that no Class 4 application was received by or explained to the Hutchins by Mr Taylor or anyone else from T&W before proceedings were commenced. The proceedings were commenced on behalf of the Applicants, N & J Investments and the Commins Partnership Pty Ltd. The evidence of Mr Commins is that he approached T&W about possible court action concerning a reliance claim. He did not receive a telephone call from Mr Taylor prior to commencement of the proceedings to discuss the application. Mrs Huggins' evidence is that she does not recall having a conversation with Mr Taylor about the content of the Class 4 application filed in separate proceedings from these, before those were commenced. Mr Taylor could not recall if he did discuss the application with the Applicants before it was filed but stated that was his usual practice. He did not personally arrange for the application to be sent and could not recall if anyone else in his office did. 276In relation to Part 1(3), whether specific instructions were obtained to commence proceedings with the Applicants and other parties, Mr Taylor conceded in cross-examination (par 49) that he did not have explicit instructions to commence the proceedings on behalf of the Applicants and other parties but he considered such authority was inferred in all the circumstances. He believed that the other parties had come to see him as a result of Mr Hutchins saying he would talk to other people about joining in the proposed action. This is disputed by Mr Hutchins who says that he told Mr Taylor he would tell other people he had come to see Mr Taylor not that he would invite them to join him in court proceedings. This belief was apparently mistaken given the evidence of Mr Commins that he was not asked by Mr Hutchins to join any action but wished to commence his own action in the name of his company in relation to assurances given by the Department (a reliance claim). Further, Mrs Huggins stated that she approached T&W because of what Mr Commins told her. She was not invited by Mr Hutchins to join an action with him. I note that in any event separate proceedings were commenced on her behalf by T&W so that her evidence does not take this matter much further. In relation to Part 1(5), that claims other than the amalgamation claim were included not in accordance with the Applicants' instructions, Mr Hutchins' evidence supported by Mrs Hutchins is that he was only interested in the amalgamation claim whereas Mr Taylor's evidence was that the Applicants wished to explore all legal avenues. 277Rather than determine whether the evidence of Mr and Mrs Hutchins or Mr Taylor is to be preferred it is preferable that I assume the worst case against Mr Taylor. Namely, that the proceedings were commenced contrary to or more accurately given the evidence, in the absence of, instructions that additional parties be joined (Part 1(3)) and additional validity claims beyond the amalgamation claim were included without the Applicants' instructions (Part 1(5)) to determine if that behaviour would constitute serious neglect or serious incompetence justifying a costs order under s 99. I will also assume that the Class 4 application was not provided to Mr and Mrs Hutchins before proceedings were commenced. I will not therefore determine as a matter of fact that the Hutchins were interested at all times in a challenge to the validity of the Plan as submitted for T&W and Mr Taylor as it is not necessary. 278The circumstances at the time the proceedings were commenced must be considered. In particular, there was very little time in Mr Taylor's view for proceedings to be commenced in order to comply with the relevant statutory limitation period under the WM Act of 23 December 2006, for challenges to the validity of the Plan. It was justified for Mr Taylor to consider it legally prudent that validity claims should be preserved at the start of proceedings. While Mr Hutchins maintained that he did not wish to pursue such action, the T&W file note of the meeting in December 2006 with Mr Hutchins refers to this topic suggesting at the least that Mr Taylor raised it with him. Mr Taylor's evidence is that the purpose of the Class 4 application filed was to keep the Applicants' legal options open. As submitted by Mr Taylor's counsel, a prudent course at that stage was to keep all legal options open. Mr Taylor can be considered to have taken a prudent course of commencing proceedings in time for several persons who approached him in the period 18 to 22 December 2006. Mr Taylor's actions were reasonable in light of his honest, if mistaken, belief that the unknown persons who came to see him after Mr Hutchins' visit in early December 2006 were referred by Mr Hutchins. As submitted by his counsel, it is inherently implausible he would commence proceedings knowing the Applicants wanted to go it alone. 279As submitted by T&W and Mr Taylor (par 149 - 150) if the Hutchins were unaware of co-applicants and other claims in December 2006 they were aware by 16 May 2007 at the very latest on their evidence yet continued to stay in the action. While the Applicants' counsel submitted that was because of a failure to properly advise them that the amalgamation claim should be pursued separately, for the reasons stated at par 243 it is not self-evident or established by the evidence that such advice should have been given by T&W and Mr Taylor to the Applicants. None of these circumstances suggest that Mr Taylor and T&W were seriously negligent or seriously incompetent, meaning they engaged in behaviour which no reasonable solicitor would have engaged in, which in addition must be serious, to justify an order under s 99 in relation to this particular. The discretionary factors (per Karwala step (iii)) identified at par 152 are also relevant to my consideration of whether there was serious neglect or serious incompetence. Further, in relation to step (ii) in Karwala , of whether unnecessary costs were incurred, as submitted by T&W's counsel, there is no evidence to establish this.

T&W Part 2 - joining further parties and causes of action to the proceedings 280In relation to T&W Part 2(1) and (2), as stated above at par 243 the Court can only speculate (which it should not do in a costs application) about whether the validity claims were complex, would take time and be costly, that the addition of further applicants would add to the costs and the time taken to finalise the matter and the longer the delay in the resolution of the amalgamation claim the more they would suffer loss of water. As pointed out by counsel for T&W and Mr Taylor this also assumes that the claim would be successful, a conclusion which is outside the scope of this costs application ( Lai Qin at 624). There is no evidence to support these submissions that such legal advice should have been given and that the amalgamation claim should be split while the validity claims were adjourned to await the outcome of other cases on appeal. The full extent of advice as referred to on numerous occasions in the evidence given to the Applicants and the context for it is not known because of legal professional privilege. As submitted by the Respondents, that loss of water to the Applicants would result is not a legal matter about which advice should be given, and is a matter self-evident to the Applicants. A claim based on this particular cannot be upheld and any evidence which went to this question does not need to be considered. 281Further as submitted (par 150) the Applicants were aware of the validity claims since May 2007 on their own evidence. 282Consequently, I do not need to resolve factual issue 6 of whether Mr Hutchins made numerous oral complaints to Mr Taylor and other employed solicitors of T&W before sending the first letter of complaint dated 4 April 2008. T&W Part 2(3) identifies several occasions on which the Hutchins allege that they told Mr Taylor and his employed solicitors of their concerns that their claim was being "lost" including on an unknown number of times between 16 May 2007 and the mediation in September 2007, during and after the mediation in September 2007 to Mr Taylor and Mr Archibald and in a telephone call on 26 June 2008. Mrs Hutchins also attended a meeting at Finley on 29 November 2007 at which she says she raised concerns about other parties being joined as the Applicants were concerned only with their amalgamation claim. On 30 November 2007 Mr Hutchins spoke at length on the telephone to Mr Brooks concerning whether more parties ought be joined in the proceedings in this Court. Further, sometime in December 2007 Mr Hutchins expressed his concern to Mr Taylor that adding more parties would complicate and delay proceedings. The content of the conversations identified by the Applicants as when complaints were made is all disputed by Mr Taylor, Mr Archibald and Mr Brooks, whose evidence collectively was that no such complaints were made to them. I would need to make findings as to credit given the different evidence and it is unnecessary to do so. 283Also particularised (Part 2(3)(i)) is a conversation with Mr King after a directions hearing at court on 16 May 2007, which I will refer to in relation to Mr King. 284Part 2(4) refers to the joinder of further parties on the following dates: (a)22 December 2006 (this was considered above in relation to Part 1). (b)20 April 2007 the Rossatos and Huggins were joined. On 20 April 2007, Jagot J gave leave for the applicants in proceedings number 06/41293 (the Huggins and the Rossatos) to discontinue the proceedings and to be joined as co-applicants in the substantive proceedings. At the hearing not much was said by the Applicants about the joinder of these further parties on this date and it is not clear if it is pressed. There is no evidence of a complaint made by the Applicants at the time of the joinder of the Rossatos. As identified in the submission for T&W and Mr Taylor (par 165) the Hutchins joined with the Rossatos to get advice jointly from Mr King in March/April 2007 and entered into a joint costs agreement. Of the additional matters raised by T&W and Mr Taylor in submissions (par 169) the most telling is that there is no evidence of costs being wasted within the Court process or outside it as a result of this joinder. (c)14 December 2007 Joinder of a large number of parties on 14 December 2007 followed the unsuccessful mediation in September 2007. Issue 8 raised by the Applicants concerns events at a meeting with Mr Brooks and others on 29 November 2007 at Finley attended by Mrs Hutchins where joinder of additional parties was raised. While there was dispute in the evidence of Mrs Hutchins and Mr Brooks about whether there was agreement to the joinder of other parties at the meeting, in the course of the hearing the focus shifted to the telephone call between Mr Hutchins and Mr Brooks on the following day. The next day, 30 September 2007, Mr Hutchins had a telephone discussion with Mr Brooks where Mr Hutchins appeared to reluctantly agree to the joinder of further parties as identified in the Applicants' submissions at par 103. Regardless of any dispute about what was said at the meeting in Finley on 29 November 2007, I agree with the submissions for T&W and Mr Taylor (par 167) that the evidence concerning the telephone call on 30 November 2007 between Mr Hutchins and Mr Brooks suggests reluctant agreement to the joinder of further parties on Mr Hutchins' part. In those circumstances there does not appear to be any basis for submitting that this joinder of multiple parties occurred in the absence of the Applicants' instructions. There is no basis for finding that the Applicants' instructions were implemented in a seriously negligent or seriously incompetent manner. (d)24 April 2008 No submissions were made about this joinder and apart from the fact it occurred I am unable to draw any conclusions about it. 285The Applicants have not established serious neglect or serious incompetence on the part of Mr Taylor or T&W by the joinder of additional parties in the manner specified in the particulars. T&W Part 3, 4 and 5 286Part 3 was not pressed at the hearing. Part 4 was reduced in final submissions to one particular and subsumed into Part 1. Part 5 sets out the unnecessary costs said to have been incurred by the Applicants for which reimbursement is sought and does not need to be separately considered.

T&W Part 6 - continuing to assert retainer after its termination 287Part 6(1) identifies that Mr Hutchins wrote to Mr Taylor on 4 April 2008 stating he intended to engage new lawyers. Part 6(2) states the retainer was terminated by letter dated 11 December 2008 from Kell Moore to T&W and Part 6(3) again by letter dated 8 September 2009. Part 6(4) identifies occasions on which it is alleged T&W asserted that they continued to hold a retainer for the Applicants or did not disabuse the CSO of the notion that T&W still held a retainer from the Applicants. As a result Part 6(5) alleges there was confusion on the part of the CSO resulting in delay in providing the undertaking which was the basis for the Applicants remaining in the proceedings until 6 November 2009. That delay is alleged to have made necessary the misjoinder motion filed on 24 August 2009 which had to be abandoned, resulting in the Applicants' own costs and those of the Crown for the motion being incurred. 288According to the chronology for 11 December 2008, there is a dispute between the parties as to whether Kell Moore's letter of that date did effect a termination of the T&W retainer by the Applicants. As will become clear it is not necessary to resolve that dispute. 289Issue 9 raised by the Applicants is whether on 29 September 2009 Mr Wolff represented to Dr Galbraith that the Applicants had not yet terminated T&W's retainer. Part 6 refers to the Applicants terminating T&W's retainer by letter dated 11 December 2008 (Part 6(2)), confirmed again by letter dated 8 September 2009 (Part 6(3)). Part 6(4) identifies three occasions when officers of T&W are said not to have disabused the CSO that T&W still held a retainer on behalf of the Applicants (email dated 11 February 2009, telephone call on 25 September 2009 between Mr Taylor and Dr Galbraith and telephone call on 29 September 2009 between Mr Wolff and Dr Galbraith). The Applicants rely on the evidence of Dr Galbraith, in particular that the file notes of the conversations with Mr Taylor and with Mr Wolff were accurate records of what was said in the telephone conversations. The particular assertion relied on is the statement by Mr Wolff according to the file note of 29 September 2009 that the retainer of T&W had not yet been terminated and the filing of the notice of change of solicitor by Kell Moore was premature. 290Accepting that this file note was an accurate description of what was said in that telephone call (Mr Wolff could not recall the words he used), this statement should not be viewed in isolation. The affidavit and oral evidence of Mr Williams and Mr Taylor and Dr Galbraith's oral evidence confirms that there had been discussions about the role of Kell Moore and T&W in relation to the Applicants with the CSO since 23 January 2009 when Kell Moore first wrote to the CSO (see par 292 below). The numerous interactions including correspondence between the parties are set out in the letter of particulars and in the chronology from 11 December 2008 up to the Applicants' discontinuance on 6 November 2009. 291As identified by counsel for T&W and Mr Taylor (par 179) Dr Galbraith understood he had to deal with Kell Moore in relation to the Applicants before and after any of the telephone calls in September 2009 relied on in the particulars. As emphasised, two solicitors acting for an applicant when court rules provide for only one solicitor to be on the record was an unusual circumstance. None of the experienced solicitors who gave evidence had encountered such a circumstance before and the various discussions between these solicitors highlight the lack of clarity about the best way forward. I agree with the submission for T&W and Mr Taylor that part of the relevant context to consider is that as long as the Applicants remained in the proceedings, T&W were their solicitors on the record. 292The oral evidence of Dr Galbraith does not refer to the retainer issue as represented by Mr Wolff as being relevant to any delay by the CSO in providing an undertaking sought by Kell Moore or the cause for confusion as alleged in Part 6(5). Further, there is no basis for suggesting that there was any delay in the CSO agreeing to an undertaking because of confusion over the timing of the termination of T&W's retainer as a result of the statement by Mr Wolff in the telephone call in September 2009. As submitted by counsel for T&W and Mr Taylor (written submissions at par 196): (a) on 23 January 2009, Kell Moore approached the CSO and raised a number of matters, including undertakings about jurisdiction and Anshun estoppel if other proceedings were commenced. Nothing was said about an undertaking that the CSO would not rely on any statute of limitation if fresh proceedings were commenced; (b) on 5 February 2009, the CSO sent a letter setting out a summary of Kell Moore's position. Nothing was said about an undertaking about limitation; (c) on 17 April 2009, Kell Moore submitted a further draft pleading and sought undertakings about jurisdiction and Anshun . Nothing was said about an undertaking about limitation; (d) on 23 June 2009, the CSO wrote to Kell Moore and said it has been attending to other matters and "regrets" the delay. It also confirmed that the CSO was still seeking instructions from their client regarding Kell Moore's letter dated 17 April 2009; (e) on 17 July 2009 and 13 July 2009, Kell Moore telephoned the CSO to progress the matter without success, affidavit of Mr Williams dated 27 November 2009 at par 25; (f) on 24 August 2009, the misjoinder motion was filed and served; (g) on 21 October 2009, Kell Moore wrote to the CSO and for the first time sought an undertaking about limitation; (h) on 22 October 2009, the CSO replied and said an undertaking about limitation had not previously been sought and instructions would need to be obtained; (i) on 6 November 2009, the Applicants discontinued with an undertaking from the CSO about limitation but no undertaking about jurisdiction or Anshun estoppel. 293As submitted by T&W and Mr Taylor , the first time the undertaking sought by Kell Moore in the terms finally agreed by the CSO was in October 2009. The Applicants' counsel accepted in closing submissions that the evidence is that the matters particularised did not result in any wasted costs or only very little as the period of delay is between 24 August and 4 November 2009 at most on the Applicants' case. As T&W and Mr Taylor submitted, the Applicants have not established that there was any link between the filing of the misjoinder motion on 24 August 2009 and the telephone conversation between Mr Wolff and Dr Galbraith on 29 September 2009. 294As already identified above as a general failing of this costs application, the main hurdle the Applicants have not overcome in relation to an allegation that Dr Galbraith was mislead in relation to whether T&W's retainer had been terminated on 29 September 2009 is that there is no evidence that any court time was wasted as a result. There cannot therefore be any wasted costs which fall within a claim under s 99. Nor is serious neglect or serious incompetence established.

T&W Part 7 - failing to cooperate with the Applicants' new lawyers 295Part 7(1) concerns the allegation that T&W refused to cooperate with Kell Moore by refusing to provide a copy of the T&W file in a timely way. This is said to have resulted in Mr Williams having an incomplete understanding of the substantive proceedings resulting in the misjoinder motion proceeding on an inaccurate assumption, causing delay when the motion and affidavit had to be corrected in an amended notice of motion filed on 23 October 2009 and the affidavit in support. The correspondence relied on in Part 7(1)(a) - (g) commencing on 19 August 2009 to 16 November 2009 from Kell Moore to T&W and in reply concerning access to T&W's file is set out in the particulars and identified in the chronology. To the extent there was disagreement between Mr Taylor and Mr Williams about whether there was a telephone call on 6 July 2008 (as stated in the chronology), nothing hangs on it and I do not therefore need to resolve that issue. 296Mr Taylor gave written and oral evidence about the circumstances at the time of the request for access to T&W's file concerning the need to get advice about legal professional privilege. The single file related to all the applicants in the proceedings and separating material relating only to the Hutchins was not a simple task. He also had to consider whether unpaid costs remained outstanding in relation to the Applicants. 297As submitted by counsel for T&W and Mr Taylor there was no unacceptable delay in the provision of the file to the extent that was able to be provided in these circumstances. The Applicants have not established serious neglect or serious incompetence in these circumstances. 298Part 7(2) alleges a refusal by T&W to allow access to the Court file. The request for access was by letter dated 17 August 2009. Access was given on 11 September 2009. Lack of timely access is alleged to have resulted in Kell Moore having an incomplete understanding of the substantive proceedings which resulted in inappropriate orders being sought in the misjoinder motion and supporting affidavit. The orders originally sought were to remove other parties from the proceedings as Kell Moore was not then aware there were additional parties from the outset. There was delay while the motion and affidavit were amended and additional costs incurred in doing so. 299For the reasons given by T&W and Mr Taylor (par 184), that does not suggest undue delay in the provision of access to the Court file in view of the privilege issues that arose in this case. Further, Mr Taylor told Mr Williams he would be occupied by proceedings in the High Court to be heard on 24 August 2009. Shortly after advice was received from counsel by Mr Taylor concerning legal professional privilege matters, access was authorised. That Kell Moore chose to file the misjoinder motion in the meantime does not result from serious neglect or serious incompetence on the part of T&W and Mr Taylor. That conclusion stands regardless of the fact that Kell Moore had a copy of the original Class 4 application as provided in the FOI documents provided to Kell Moore in July 2008. 300There is no evidence that Court costs were wasted, as is necessary for a claim pursuant to s 99. Nor is there any basis to find there was serious neglect or serious incompetence on the part of T&W and Mr Taylor in relation to this particular. There is no basis established by the Applicants for awarding any costs under s 99 as sought in relation to any of these particulars. The Notice of Motion as against T&W and Mr Taylor ought to be dismissed.

Particulars against Mr King 301The case mounted against Mr King contracted in the course of the hearing with two aspects of the claim being Part 2, incompetent pleadings, and Part 3 not pressed, save for that picked up by Part 1. As identified by Mr King's counsel there is very little remaining of the case against Mr King.

King Part 1 - failing to advise amalgamation claim should be litigated separately 302As already identified above at par 195 and 204 the matters which Mr King is alleged to have failed to advise about (Part 1(1), (2)) are in turn matters identified in T&W Part 2(1) and (2) (validity claims complex, take time and costly, further applicants would add to costs, amalgamation claim simple, and delay results in loss of water). I have already identified that the challenge based on these particulars cannot succeed. These are not self-evidently correct matters about which any of the Respondents should have been aware and therefore failed to advise upon. No evidence has been brought forward to establish that these were such matters, rather the assertion is simply made. Mr King's counsel's submissions to that effect are accepted (par 196 topic (i)). This failure is further identified in Mr King's counsel's submissions (par 204 topic (vi)) where the extent of the failure to bring forward evidence of what would be required to establish the amalgamation claim, the likely defences to such a claim, inter alia, is identified. 303Further no breach of duty to the Court has been identified in relation to Mr King's actions whereby an alleged failure on his part has resulted in disruption to court processes, as I have found above and as submitted by Mr King, par 197 topic (ii). 304The additional factor in relation to Mr King emphasised by his counsel which needs to be borne in mind is that he was not briefed by T&W until March 2007 and did not therefore provide advice until after proceedings were commenced with multiple applicants and claims. His conduct must be considered in light of the circumstances as he found them. For the reasons given by his counsel at par 186 and par 200 i), particularly that Mr King was entitled to believe that the Applicants intended to be part of a group where validity claims were made and some had alternative claims, the specific costs sought in relation to the validity claims and the Applicants' costs of discontinuing from the proceedings cannot be claimed from him. It has not been established that his behaviour caused these costs to be incurred. 305As submitted by Mr King's counsel, there is an absence of evidence to establish serious neglect or serious incompetence, par 198 topic (iii). Comprehensive and thorough submissions summarised above at par 200 topic (v), headed failure to take account of many matters, provide further reasons why this claim is not maintainable. These reasons include that a barrister in Mr King's position was entitled to consider the Applicants' wishes to be part of a group action where the best claims were the validity claims; all considered that the issues could be heard together early, then April 2008; the usual rule is that all issues should be tried together as separate determinations lead to unforeseen complications and delay (per Tepko ); the amalgamation claim followed the validity claims as if the Plan was invalid it did not matter how the rules under it were applied. Further there was a real risk that if an application for an order for separate determination was made it would fail with a resulting costs order against the Applicants. As these submissions all appear correct I adopt them. Further, as submitted at par 200 xiii) there can be no suggestion that Mr King should have considered the amalgamation claim was so strong as to justify separate determination, a submission linked to the finding I have already made that success in the amalgamation claim cannot be assumed in this costs application. 306As identified in Mr King's submissions par 206 - 208 topic (vii), whether a separate hearing of the amalgamation claim would have been permitted was not certain and indeed contrary to the Court's preferred practice of having all related matters in issue determined at the same time. As such an application would not necessarily succeed and such an application might have resulted in a costs order against the Applicants. This submission also applies to Mr Taylor and T&W and was made by their counsel. 307The triggers for the failure to advise raised by the Applicants in relation to Mr King are the disputed matter of what was said at a conference held with Mr Hutchins and Mr Archibald on 13 April 2007 and whether draft POC were presented and discussed at the conference (issue 4). This is not particularised and strictly speaking in light of my earlier ruling that matters not particularised should not be pressed it should not be allowed. The meeting on 13 April 2007 was not referred to in Mr Hutchins' first affidavit. It was addressed in Mr King's affidavit and in the affidavit in reply of Mr Hutchins and was the subject of cross-examination of Mr Hutchins, Mr King and Mr Archibald. Mr Hutchins' evidence was that draft POC were not presented, whereas Mr King's evidence is that such a document was. Mr Archibald who was present cannot recall when he asked Mr King to prepare the POC. There is no dispute the final POC were sent to Mr Hutchins by email dated 2 May 2007. 308For the reasons given above in relation to why Mr King's behaviour must be assessed as reasonable as a barrister in light of the circumstances he found himself in, there is no point in making findings of credit which will be adverse to at least one of the parties when there is no utility in doing so. For the purposes of considering the principles applicable to the application of s 99 I will assume the worst case against Mr King namely that the draft POC were not at the meeting. Accepting Mr Hutchins' evidence that no POC were discussed at the conference on 13 April 2007 does not mean that there was no consideration of the amalgamation claim in the context of the proceedings overall at that conference. The purpose of the conference was to discuss the proceedings with one of the Applicants' directors, Mr Hutchins. 309There is also a dispute between Mr Hutchins and Mr King about what was said following a directions hearing on 16 May 2007 (issue 5). This is also identified as another trigger giving rise to a failure to advise of various particularised matters. Assuming for the purposes of this judgment only that Mr Hutchins' evidence of what was said is correct, as stated by Mr King's counsel the alleged exchange was very brief (see par 211) and simply cannot give rise to a finding that an obligation on the part of Mr King to provide certain advice was triggered given all the other matters known to Mr King, as identified above. There can be no finding of serious neglect or serious incompetence in relation to Mr King's conduct based solely on that conversation. 310The alleged failure of Mr King to advise against the joinder of a large number of additional parties by T&W (Part 1(3)) is also raised. For the reasons given already concerning the matters he is alleged to have failed to advise on not being self-evidently proven, there can be no finding of failure by Mr King. That he expressed a view about the positive benefits of joining additional parties in a letter dated 4 December 2007 as identified in the letter of particulars is immaterial to support the Applicants' claim. As submitted by Mr King's counsel, par 215 - 216, the addition of more parties did not mean that more costs would be incurred or more time taken as the validity claims concern issues of statutory construction which issues were not expanded by the addition of further parties. 311A final factual dispute raised somewhat faintly in the Applicants' counsel's submissions and not particularised against Mr King is what was said at a conference on 12 September 2007 (issue 7) between Mr Hutchins and Mr King. This was not identified as having any bearing on any of the matters raised against Mr King and I will not consider it further. 312As submitted by Mr King's counsel at par 218 - 221 (topic (x)), the Applicants have not established a causal connection between the alleged conduct of Mr King and any wasted costs. To the extent costs concerning the validity claim were already incurred before and after Mr King was briefed he is not liable for those given that he played no initial part in the proceedings. There were arrangements in place for the sharing of costs. If the amalgamation claim was heard separately and failed, costs would be likely to have been incurred, and the validity claims would have been the only possibility to obtain water at the desired level. 313The Applicants have not discharged the onus of proof they bear of establishing serious neglect or serious incompetence on the part of Mr King. The Notice of Motion as against Mr King should be dismissed in its entirety.

Orders 314The Court makes the following orders: 1.The Notice of Motion filed on 27 November 2009 is dismissed. 2.Costs are reserved. 3.Exhibits to be returned.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 10 June 2011