Naumann v. Clarke & Robertson Radiology & Ors [2002] QDC 69 (28 March 2002)

District Court of Queensland|2002-03-28|Before: Williams J

[1] This is the plaintiff's application to the court under UCPR r.742, he being a party dissatisfied with the decision of the Deputy Registrar under r.741 on re-consideration of an original assessment of costs payable by the defendants. A number of items were raised for consideration by the court in its review, against the background of the Deputy Registrar's having made originally, and adhered to on re-consideration, an adverse order as to costs of the assessment, from the plaintiff's point of view, based on his non-acceptance of the defendants' offer to settle costs.

[2] The defendants in some combination conducted a radiology practice, at which the plaintiff was employed. He contracted dermatitis for which he sought to hold them responsible. Proceedings were commenced in the Supreme Court, in circumstances necessitating an extension of the limitation period, which was obtained from Williams J. Comments his Honour made apparently led to the action being transferred to this court and, indeed, settled quite quickly for $15,000 plus costs.

[4] The matter came on as a confessedly "long" one before me as applications judge on 20 February 2002, which was otherwise a heavy chamber day. There was some argument of a general nature, and specifically a separate argument regarding two particular items, upon which I gave rulings, which, as transcribed by the State Reporting Bureau, are included as appendices to these reasons.

[5] The court ran out of time on that afternoon, as I had to adjourn to preside at a Bar Practice Centre Moot at 6pm. The parties were content that the review be dealt with further by my consideration of written submissions which had already been handed up; they were to be supplemented by a kind of "Scott Schedule" which would readily identify the submissions, considerations and material relevant in respect of particular items for my assistance. The conclusion on that day was:-

signifying that the hearing was completed and that the parties had raised everything they wished.

[6] The following day, Mr Gray approached my associate seeking to have the hearing re-opened. This was achieved the following afternoon, when time was available, with the co-operation of Mr Ulrick, the defendants' counsel, who attended, but, in the interests of his clients, voiced objection to any new points being raised. The new point was that all along everyone, including the Deputy Registrar and the parties, had been operating on the mistaken basis that a small number of items treated as having been incurred after the defendants' offer to settle were in truth incurred beforehand, so that the offer was considerably less embarrassing to the plaintiff than had been appreciated. On the original assessment, assessed costs were below the offer amount; on the reconsideration they were slightly above, but not sufficiently to dissuade the Deputy Registrar from adhering to the adverse costs order already noted.

[7] In the circumstances, I think the interests of justice require that the court consider the new point, although care should be taken to ensure the defendants are not prejudiced at this late stage by the plaintiff being treated as if the point had been raised earlier than it was.

Plaintiff's solicitor's letter to WorkCover seeking copy of Plaintiff's file drawing and engrossing solicitor's observations on contents of file

[8] It is convenient to proceed to the next item requiring consideration following those dealt with in the appendices, which held it justifiable for the Deputy Registrar to include a letter to WorkCover seeking the plaintiff's file and drawing and engrossing the solicitor's observations on eleven pages of material obtained from WorkCover (and reproduced in full in counsel's brief) for inclusion in the brief to counsel in "item 27 - (i) Instructions for brief, (b) all necessary perusals and work in relation to preparation for hearing", with the caveat that, depending on how much was found to be brought under item 27 at the end of the day, that allowance might require re-consideration.

Summary of Interview and Conference with Plaintiff

[9] Appendix B dealt with items 22 and 23 in the bill or costs statement. Under the same objection come other bill items 73 and 74, fees for drawing and engrossing respectively a summary of an interview held with the plaintiff. Only an amount of $1.60 was allowed for photocopying of the summary for the brief. No basis appears for disagreeing with the Deputy Registrar's view that the work in question was subsumed in the following two items, drawing an engrossing of plaintiff's statement of evidence, so that the earlier items constituted a "luxury" rather than something "necessary or proper", as referred to in UCPR r.703.

[10] Items 223 and 224 were for drawing and engrossing a "summary of conference held with the plaintiff on 29.9.1999". The Deputy Registrar's ruling was that: -

"The Plaintiff does not sufficiently demonstrate why this note is not just an "aide memoire" to the solicitor, but that it constitutes instructions to counsel for inclusion in the (trial) brief or is for example, an update to the plaintiff's statement of evidence already drawn and claimed in the bill.

At best item 27 of the court scale applies to item 223 and the specific amount claimed for this item is disallowed. Regard to the work performed at items 223 and 224 should be had at item 307 of the bill. Item 224 is reduced and an amount representing photocopying has been allowed at this item."

[11] The plaintiff's argument is that the Deputy Registrar's inclusion of the work in item 307 of the costs statement claim (which relates to item 27 in the costs scale) demonstrates the work was "necessary", continuing: -

"Merely because the plaintiff's solicitors may have gained some benefit from having the contemporaneous file notes should not result in the claim being disallowed. In Alkina Pty Ltd v. Lambert & Associates Pty Ltd, unreported judgment District Court, Brisbane, 15 February 1999, McGill DCJ at p.7 held such allowances were appropriate where drawing and engrossing of the notes were for the purposes of providing them to counsel."

I see no error in the Deputy Registrar's approach. It has not been shown that the items come within r.703.

[12] Considerations respecting the following contentious items are similar. It suffices to set out the reasons given by the Deputy Registrar:-

"Items 226 and 227 relate to a claim for drawing and engrossing for inclusion in counsel's brief, an updated schedule of the calculation of the plaintiff's damages. The amount of $15.30 was disallowed in full at the assessment hearing, and item 227 was reduced by the sum of $3.70. The amount allowed an item 227 represents the cost of a photocopy of the document.

It is not clear that the document was drawn and engrossed in the first instance as instructions to counsel. The document was produced as an internal note for use by the solicitor. The file note may have proved useful in the compilation of future documentation filed by the Plaintiff, eg. A statement of loss and damage. However drawing and engrossing of such a document would necessarily attract its own fee. And a copy of such a document would be included in counsel's trial brief.

Item 27 of the scale should be applied to these items and a photocopy of the note allowed an item 227.

The plaintiff's objections to items 226 and 227 are dismissed.

Items 228 and 229 relate to claims for drawing and engrossing a schedule of the plaintiff's average weekly earnings for inclusion in counsel's trial brief.

For the reasons I have referred to above in respect of similar items, the Plaintiff's objection to the rulings made at hearing for these items is disallowed. It is noted that the allowance at item 229 has been modified to notionally allow for a photocopy of the document at item 228 to be included in counsel's trial brief.

Items 230 and 231 relate to claims for drawing and engrossing a schedule of information from the Plaintiff's income tax returns and group certificates.

Item 27 of the court scale applies to these items and the Plaintiff's objection to the rulings made at hearing for these items is disallowed.

Item 231 has been reduced to notionally allow for a photocopy of the document for inclusion in counsel's trial brief."

Items 265 and 266 relate to claims for drawing and engrossing a summary of the conference held with the Plaintiff. A description of the conference is provided in item 264 of the bill.

My notes from the assessment hearing indicate that when called for the Plaintiff's solicitor could not produce the document for scrutiny. Without viewing the particular document, no check can be made of the claim that it comprises:-

2. whether it adequately constitutes instructions to counsel or is just an internal document.

The Plaintiff's objections to items 265 and 266 are dismissed.

Items 268 and 269 relate to a claim for drawing and engrossing for inclusion in counsel's brief a summary of the calculation of the Plaintiff's claim for damages under "the separate headings".

The specific amount claimed at item 268 was disallowed at the assessment hearing but regard had to the work under item 27 of the scale at item 307 of the costs statement.

For reasons given to similar items above, the Plaintiff's objection to items 268 and 269 are dismissed. However, the amount allowed for photocopy at item 269 in the sum of $1.60 remains."

[13] Again, it is convenient to set out the Deputy Registrar's reasons given on re-consideration in relation to items 60 to 65 in the bill:-

These items relate to a claim for the preparation of an affidavit of service of the writ by the Plaintiff solicitors' agent on WorkCover Queensland.

According to the costs statement as drawn, Items 60 to 65 are said to have occurred on 3 March 1999. The affidavit of service of the "Writ" on WorkCover is sworn by Bradley Kennedy Smith and dated 17 March 1999. Mr Kennedy Smith deposes to the fact that he served the writ on WorkCover on 11 March 1999. If this were the case then certain dates given to items are inaccurate eg. Item, 70, which is a claim for a letter to the plaintiff advising the Plaintiff of service of the plaint on the defendants and the defendants' common law insurer. Item 70 on the face of the bill occurs on 8 March 1999, that is, before the date of service deposed to in the affidavit of Mr Kennedy Smith.

Further, Item 65 is a claim for filing the "affidavit of service". A perusal of the documents on the court file indicates that Mr Kennedy Smith's affidavit was not filed until 29 June 1999, the same day the Plaintiff's application for an extension of the limitation period to commence his action was filed.

No affidavits of service relating to service of the "Writ' on the first, second and third defendants appear have been placed on the court file. In any event, gathering from the description at item 60, the Plaintiff appears to make claim for the affidavit of service on WorkCover only. However, it must be remembered in this regard that a component for "Affidavit of Service of Plaint on Defendants' has been allowed under item 1 of the scale at item 51 of the costs statement.

Further it is noted that section 185 of the Workers Compensation Act 1990 has no applicability in relation to this item at all. This legislation had well and truly been repealed by the date of the claims at items 60-65.

Given the above, the plaintiff has been sufficiently compensated for items 60 to 65 other than item 62 at item 51 of the costs statement.

Counsel was briefed to settle the Plaintiff's statement of claim (see allowance made at item 243 of the costs statement). Service of the originating material on WorkCover is pleaded at item 3 of the Plaintiff's statement of claim. An allowance should be made at item 62 for photocopying the affidavit of service for counsel's brief to settle the statement of claim.[1]

The Plaintiff's objections to items 60, 61, 63, 64 and 65 are disallowed. The Plaintiff's objection to the ruling at item 62 is allowed in the sum of $1.00."

[14] The plaintiff's argument on the review was that there was error in taking into account the repeal of the Workers' Compensation Act 1990 and that the plaintiff was required by the provisions of s.185 of that Act to serve the proceedings on WorkCover and then file an affidavit of service in the court. The argument went on that item 1 in the scale, as referred to in the reasons, "merely provides for an allowance for an affidavit of service. It does not provide for attendances to sign the document and to file it in the court." It was argued that such steps were therefore necessary and proper. Section 185(1)(c) and (d) required a plaintiff to serve on the Board a copy of the writ or other initiating process and "before any further step is taken.... in the proceedings ..... file in the court in the proceedings an affidavit of such service." The effect of the WorkCover Queensland Act 1996 s.534, and appropriate steps taken in relation thereto was that the Workers Compensation Act 1990 was repealed as of 1 February 1997. It is now provided in s.306(4) that legal process that starts a proceeding must be served on WorkCover within thirty days after the employer has been served, and no step may be taken in the proceeding until WorkCover has been served (other provision being made for self-insurers). The statutory requirement for filing an affidavit of such service (and any implied requirement for preparation of such an affidavit) appears to have gone. I am not persuaded the Deputy Registrar has erred, or that she might in some way have distracted her own attention from the fundamental point in the course of submitting these items to the very close scrutiny which she did.

[15] The next contentious item is $17.30 for a letter to Dr Gritton advising of the proceedings, enclosing the plaintiff's signed authority and seeking an appointment to attend on him to inspect his relevant records. The reasons given on the reconsideration were:-

Item 91 relates to a claim for a letter to the Plaintiff's treating GP.

The specific claim under item 97(3) of the scale for an ordinary letter in the amount of $17.30 was disallowed on the hearing. However item 27 of the scale was applied to item 91, and the work conducted here by the Plaintiff's solicitors was given consideration when determining the allowance at item 307 of the costs statement.

Reference is made to item 28 of the costs statement, which is a claim for perusal of the report of Dr Gritton, dated 4 February 1998. This item is claimed and has been allowed under item 27 of the scale.

Later at item 40 is a claim for an attendance on the Plaintiff to take instructions regarding medical reports including the Gritton report. This item is claimed and was allowed on the assessment hearing under item 27 of the scale.

The Plaintiff does not address the application of item 27(b) of the scale, that is to say, work done in preparation for hearing.

The letter component of the claim at item 91 has not been taxed off in full, the specific amount has been disallowed but regard had to the work performed and allowance made when considering item 306 of the costs statement. Given the application of item 27 to item 91, the specific disbursement for postage on the letter remains at $0.45.

The Plaintiff's objection to the ruling at item 91 is disallowed."

[16] It is pertinent to this item, as, indeed, in respect of most of the individual items, to recall that a party and party taxation, now an assessment on the standard basis, must be expected to occur on a parsimonious scale. A well known statement of the justification for this (which Mr Ulrick presumably had in mind, although he did not cite it) was given by Sir R Malins VC in Smith v. Buller (1875) LR 19 Eq 473, 475:-

"It is of great importance to litigants who are unsuccessful that they should not be oppressed by having to pay an excessive amount of costs. The present case illustrates this principle very clearly. I am satisfied that the Plaintiff's invention of this swivel was a most meritorious one, and, though he was ultimately unsuccessful in the suit, because there was held to be an anticipation, and therefore he must pay the costs, I think he ought to bear no more than the necessary costs. I adhere to the rule which has already been laid down, that the costs chargeable under a taxation as between party and party are all that are necessary to enable the adverse party to conduct the litigation, and no more. Any charges merely for conducting litigation more conveniently may be called luxuries, and must be paid by the party incurring them.

The Plaintiff is the attacking party, and has failed, and he must therefore pay all charges necessary to the litigation. But if the Defendants give greater facilities for the conduct of the case than are strictly necessary, they ought not to be allowed to throw them upon the Plaintiff. I have no doubt that what was done was very convenient, and this was proved by the fact that the Plaintiff took advantage of the drawings. But I am of opinion that if the suit had gone the other way, such charges could not have been thrown upon the Defendants, and therefore the Plaintiff ought not to be required to pay them.

I have myself, when at the Bar, held as many briefs as fall to the lot of most men, and I have often found in the papers supplied to me things which, though very convenient, were not absolutely necessary. Therefore, though I very reluctantly differ from so experienced a Taxing Master as Mr Wainwright, I am compelled to do so in this case, because, though these drawings are very convenient, I cannot consider them necessary."

I accept that the addition of "or proper" to the word "necessary" in r.703(2) "connotes a wider ambit of charge" and that in assessing costs, "care must be taken not to be affected by ... "hindsight"" - W&A Gilbey Pty Ltd v Continental Liqueurs Pty Ltd (1964) 81 WN(NSW) Pt1 1, 9-10.

[17] Contact with the doctor could have been made in less costly ways, such as by a phone call, or through the plaintiff. The approach adopted seems more courteous to the doctor, and was very likely appreciated by him. The question is whether the other party should have to pay. I am conscious, in suggesting that the plaintiff himself might have become involved, that it is basic to our system that litigants are entitled to be represented by solicitors and counsel, and it would be quite wrong to deprive a plaintiff of costs necessarily or properly incurred on the basis that he or she could have carried out certain steps personally, as if a litigant in person.

[18] The other consideration, already mentioned, is the allowance under item 27 of the scale, which was a substantial amount. This allowance should not be seen as a bonus payable over and above separate charges for every piece of work done. In my view, it is intended to represent remuneration for necessary or proper work, and may be regarded as covering items of work that, in principle, are capable of being separately identified, even if not separately remunerated. I would not interfere with this determination of the Deputy Registrar.

[19] Items 104 to 108 inclusive in the bill relate to telephone and letter contacts between the plaintiff's solicitors and solicitors for a company constituting an x-ray practice at Ipswich associated in some way with the defendants; the latter solicitors raised objection to the former acting for the plaintiff, given a retainer "in relation to a certain lease" until 12 December 1998. The plaintiff argues that the mere fact that Clarke & Robertson X-Ray (Ipswich) was not named as a party does not mean that the correspondence was not necessary or proper, the proprietor company being "noted in the WorkCover records. The correspondence was sent to the plaintiff's solicitors because of the proceedings that were instituted and that correspondence had to be responded to." In my view, a complication of this kind must be counted a misfortune for the plaintiff. It may be accepted that his solicitors were required to respond. The unfortunate issue that arose was related to the plaintiff's proceeding, but in no way was necessarily or properly part of it. The case may be different if (contrary to anything that appears) the defendants had raised the issue.

Covering letter for Writ of Non-Party discovery

[20] I agree with the Deputy Registrar's reasoning:-

This item relates to a letter to "Dr J. Gritton" forwarding a sealed copy of a writ of non-party discovery by way of service, and requesting a date for inspection of the doctor's records of the Plaintiff.

I would refer the Plaintiff to the general form of Writ of Non-Party discovery applicable at that time for matters proceeding in the District Court. Practice Direction 2 of 1994 of the Chief Judge of the District Court was also applicable in the preparation of such documents. The form of document for Writs of Non-Party Discovery applying at this time required the insertion of a name in the document. The praecipe for the Writ is on the court file, filed 18 May 1999, and directed to Dr John Gritton. Secondly the form of document for the Writ of Non-Party discovery also required the party served with the Writ to produce the documents at their place of business within ordinary business hours, unless agreed otherwise. Further the form of document also required the party serving the Writ to specify their address and telephone number,

The argument put forth by the Plaintiff that if a letter had not been sent with the writ then it would have been necessary to retain a process server is not acceptable when one has regard to the general form of Writs of non-party discovery applying at that time.

If a letter were to be allowed then an allowance for an ordinary letter would be quite excessive on the standard basis. An allowance for a short letter under item 97 would be quite sufficient and that is what occurred on the assessment hearing.

The Plaintiff's objection to the ruling at item 138 is disallowed."

[21] The practice direction referred to is set out in Wylie, District Courts Practice r.196A.25. The form of "Writ" in the designated form, commencing with the imperious "We command you..." is, in my view, self-explanatory; indeed, the document is considerably less complex than its replacement, Form 21 under the UCPR. While I would commend the courtesy of a covering letter, to soften the demand, and perhaps provide relevant guidance to the recipient, I am not at all prepared to say it was wrong to regard preparation of a covering letter as outside r.703. Presumably such letters will continue to be used anyway, on the basis that courtesy to the person in Dr Gritton's situation will pay dividends in the end, of more importance than the cost of the letter being un-recoupable.

Telephone call to arrange appointment to inspect Dr Gritton's records.

[22] Item 141 was claimed as a necessary or proper telephone attendance under item 64(3) of the scale. The Deputy Registrar accepted the defendants' submission before her that an attendance for the collection of evidence fell within item 27 of the scale, an allowance being made accordingly, under item 307 of the costs statement. The plaintiff's submission was that the Deputy Registrar regarded the subject work as an attendance upon the plaintiff's witness, whereas it was properly regarded as "a necessary attendance for the collection of evidence .... in response to delivery of a non-party discovery." It seems to me the distinctions here are pretty fine. The matter never came close to trial, so that the cast of plaintiff's witnesses was never finalised. It is difficult to see that the "evidence" being collected could ever be used unless Dr Gritton became a witness. I would not be prepared to assume it would have gone in by consent at a putative trial. The ruling under review stands.

Instructions for limitation period extension application and affidavit.

[23] Items 144 and 148 in the costs statement, attributed to 29 June 1999, cover "instructions for application to the court for an order to extend the limitation period" and, "instructions for the plaintiff's supporting affidavit" respectively. The scale items are 51 and 25 respectively. The Deputy Registrar's reasons state:-

Item 144 relates to obtaining instructions from the plaintiff to bring an application to the court to extend the statutory limitation period. The item is claimed under item 51 of the scale.

Item 148 relates to a claim for obtaining instructions from the Plaintiff to prepare an affidavit supporting the application to the court to extend the statutory limitation period. This item is claimed under item 25 of the scale.

Rule 707(a) UCPR provides that in assessing costs the registrar must consider any other fees and allowances payable to the solicitor or counsel for other items in the same proceeding.

The following items in the costs statement are noted as having been allowed to the plaintiff:-

s Item 1 attending and receiving instructions to sue

s Item 99 attendance on the client and counsel in conference

s Item 109 and 112 fees paid to counsel to draft summons and affidavit for extension of statutory limitation period

My noted from the assessment hearing indicate that the predominant reason for disallowing items 144 and 148 was that they are covered by the amount allowed at item 99 for conferencing with counsel. The absence of a file note to support both these items is not fatal but does make the task difficult in determining whether they are necessary or proper and whether they should attract a specific scale item amount. How long were the attendances? Regard must be had to the number of attendances on the client allowed up to this point in the bill.

The Plaintiff's objections to the rulings at items 144 and 148 are dismissed."

On April 21, fees were paid to counsel for drafting the summons (item 112) and affidavit (item 113) and there was an attendance on counsel to collect them. The item 136 attendance (May 20 1999) was "to confer in regard to his draft affidavit and obtaining information necessary for completion thereof." It is unsurprising the Deputy Registrar was not satisfied that the further "instructions" of June 29 were necessary or proper, in the absence of any file note to explain them. The plaintiff's response was:-

"Objection 8 - Attendances Upon the Client to Obtain Instructions on Application and Affidavit

36. The Deputy Registrar erred in determining that because of other allowances made for attendances upon the plaintiff, and in the absence of the diary note the allowance for instructions should not be made.

37. At the assessment, it was submitted on behalf of the plaintiff that although there was no note of attendance, the attendance did occur. This should have been sufficient as the application was made and it was made upon instructions that had been given by the plaintiff to his solicitors.

38. The allowance in the scale is for obtaining instructions, not for a specific attendance, of a particular time, upon the plaintiff. Those items within the scale that require a specific attendance are identified at items 42-65 inclusive."

[24] I accept the force of that submission, but note that significant charges are made ($57.00 and $25.00 respectively) which seem generous if no more is involved than the plaintiff confirming that the application is to be proceeded with and that his affidavit is in order. I would construe "instructions" to imply that significant exchanges of advice and giving and seeking of information would be involved.

[25] Item 217 in the costs statement is dated 15 September 1999 and followed attendance on the plaintiff on that day regarding the defendants' formal offer to settle, which was rejected on instructions. WorkCover was sent a fax "informing of our instructions and seeking supply of payment details". Item 218 was for perusing the details of claim from WorkCover six days later, WorkCover's letter "recommending that a further statement be obtained immediately prior to settlement or trial and advising that the employer excess, if paid to the plaintiff, was not shown on the statement". The Deputy Registrar determined that item 217 was not necessary, coming, as it did, after rejection of the defendants' offer to settle. Item 218 was regarded as coming within item 27 of the scale, and therefore within the allowance at item 307. The defendants' submission before the court referred to item 20 in the costs statement (April 3 1998), which related to perusing relevant WorkCover records which had been obtained; it was submitted they would include the payment details of claim. The plaintiff asserts that the Deputy Registrar was repeating her error of regarding WorkCover as the plaintiff's witness, and that this particular correspondence was necessary "to obtain confirmation of the refund owing to WorkCover, which is necessary to calculate the plaintiff's claim." It is difficult to see the necessity, at that particular stage, in the circumstances, of the work claimed for.

[26] The plaintiff's outline of argument on the review adopted the description "Care and Consideration" for what is covered by item 27 in the District Court scale of costs:-

"27. (1) Instructions for brief for counsel, or brief notes for solicitor where no counsel employed on trial, including -

(a) all attendances on, and correspondence with, the party and the party's witnesses; and

(b) all necessary perusals and work in connection with the preparation for hearing;

(2) The registrar may allow, in addition, necessary out-of-pocket expenses.

(3) If because of special circumstances, a party considers that the maximum allowance under subitem (1) is not enough for the work actually done, the party may apply to the trial judge at or after the trial to certify to the registrar that the registrar may allow a higher amount that the registrar considers proper in the circumstances.

(4) The registrar may allow a higher amount under the certificate."

[27] The item is intended to cover much more than a "care and consideration" loading over and above remuneration for work done. It seems to me the essential function of the scale item is to provide remuneration for actual work done in advancing an action. The description given in the costs statement against the date July 4 2000 is:-

"Instructions for Briefs to Counsel and instructions generally throughout the proceeding and including allowance for all attendances on and correspondence with the Plaintiff and witnesses, perusal of material, time necessarily engaged in research and consideration of law and facts, responsibility, specialised skill, care and consideration (Item 27 - part allowance)"

[28] The plaintiff had left the amount column incomplete, through some error, and was allowed on the assessment to insert a claim for $1,650.00, consistently with "running totals" supplied. The Deputy Registrar allowed $900, and, on her reconsideration, $1,050. The defendants had suggested $500, which the Deputy Registrar thought "quite unreasonable". She rejected their claim, belatedly raised (not contained in their Notice of Objections filed prior to the assessment hearing), that item 24 of the costs scale might have been applicable, rather than item 27 - a thought which seems to have originated with the Deputy Registrar, for reasons I think are both obvious and sound. Item 24 of the scale seems to me exactly applicable:-

(a) a proceeding is settled or not proceeded with; and

the judge or registrar may allow an amount under this item.

(2) The amount allowed under this item is to include -

(a) allowances for instructions to settle and all attendances on, and correspondence with, the party and the party's witnesses; and

(b) all necessary work and perusals in connection with the settlement, advising in relation to the settlement, and briefs to counsel in regard to settlement;

(3) The judge or registrar may allow, in addition, any necessary out-of-pocket expenses.

(4) If because of special circumstances, a party considers that the maximum allowance under subitem (2) is not enough for the work actually done, the party may apply to a judge to certify to the registrar that the registrar may allow a higher amount that the registrar considers proper in the circumstances.

(5) The registrar may allow a higher amount under the assessment order."

[29] In the end, the Deputy Registrar determined that item 27 ought to be applied for reasons she gave; that determination, in my view, fairly reflects the way the parties conducted themselves in the assessment.

[30] On the review, the defendants were able to mount a convincing argument that the allowance ought not to have been too far from the maximum allowed under item 24, in any event (said on both sides to be $1,037), even if the allowance were made, as a matter of form or law, under item 27. The defendants' submission notes the early stage at which the proceeding was settled, before particulars of the statement of claim had been provided, before any reply to the defence (which raised distinct issues) was filed, before a statement of loss and damage was delivered, and before the plaintiff obtained his own supporting specialist medical report. Little was done, it was submitted, after the plaintiff achieved extension of the limitation period; apparently no further medical reports were obtained, for example.

[31] On the reconsideration, the plaintiff contended for an allowance of $2,833.59. If Mr Ulrick's percentages are correct, that inflated the plaintiff's claim from 54% of the maximum permissible to 94%. The Deputy Registrar finally allowed 34%.

[32] I may have set a hare running by a throw away comment, in the course of certifying for purposes of item 27 in Boral Resources (Qld) Pty Ltd v Trim, 2330 of 1993, 6 May 1997, that item 27 was "inadequate, even in a run-of-the-mill case." Boral was assessed by me, for reasons I gave then and on earlier occasions, as a matter that became complex, because of the way it was run on the defence side.

[33] The plaintiff relies on comments of Judge McGill S.C. in McCoombes v. Curragh Queensland Mining Ltd, 14 June 2001, where his Honour said:-

"[150] Nevertheless, the fact that the scale limit is relatively low and has been recognised as such judicially is, in my opinion, a relevant consideration. If it were appropriate to approach the matter on the basis that $3,013 was the maximum to be reserved for the most complex, or a particularly complex matter, and allowance should be made in respect of other matters by scaling them with reference to that maximum, the result might be quite unfair. In circumstances where there is some judicial recognition that the item is too low, it should be accepted that the courts will not be too restrictive in determining that there are special circumstances justifying the giving of a certificate under para. (3) allowing a higher amount on assessment. Accordingly, the upper limit should not be confined to cases of unusual difficulty and complexity or length in the context of District Court litigation, but rather cases which are, within the ordinary run of District Court litigation, at the more complex, more difficult or relatively long end."

[34] Although the defendants submitted the plaintiff's case (which, significantly in my opinion, settled for a modest sum) was straightforward (because the stage was never reached where the plaintiff and his legal representative had to come to grips with complex issues raised by them, the Deputy Registrar expressly rejected a contention along those lines, noting that the amount allowed at item 27 must take into account the following:-

The nature of the injury and how it manifested over a period of time, leave being sought by and granted to the plaintiff to have the statutory limitation period extended so that the action can be commenced;

"The outcome of the proceeding was very important to the plaintiff";

There were no periods of extensive delay or inactivity once action commenced;

Although certain allowances for counsel have been made, there was no appearance of any over-use of counsel in the preparation of the case.

Another feature of complexity relied on by the plaintiff was that the plaintiff had "different prospective employers".

"46. ...... When it is accepted that the plaintiff's action has passed a stage where item 24 is applicable then a more substantial award is required.

47. The Deputy Registrar failed to take into account the value of the work actually done on behalf of the plaintiff which was accepted as being necessary or proper for the conduct of the action and to which item 27 of the scale applied. In his application for reconsideration, the plaintiff identified the value of those items as being $2883.59. The defendant did not dispute the figure as calculated but said this was not an appropriate approach to deal with the allowance for care and consideration.

48. In her reply to the application for reconsideration, the Deputy Registrar at p.19 acknowledged that a percentage approach is one guide that the assessing registrar may employ to determine a suitable allowance under item 27.

49. The Deputy Registrar referred to matters taken into account by her in considering the allowance but failed to give appropriate value for the nature of the action and for the value of the work undertaken.

50. The Deputy Registrar erred in being unduly influenced by the fact that the plaintiff has only claimed an amount of $1650.00 for this item.

51. Costs are an indemnity and the cost recovered should, as far as practicable, indemnify the party with the benefit of the costs order. That indemnity is being whittled away by artificially reducing the amount allowable, simply because the action may not be considered to be a complicated matter.

52. It would not unduly complicate a costs assessment for the value of those items to be properly considered. To the contrary, it would remove an arbitrary assessment made by a Registrar, without regard to the true value of the work undertaken. This would reduce the prospects of a manifestly inadequate award being made, as occurred in this case.

53. The full value of item 27 claims, calculated by reference to those amounts being allowed on an individual basis should be taken into account in considering the allowance for claims under item 27."

[36] As I understand it, the point of 50 is that the plaintiff's original claim was based on the notion that success would be enjoyed in respect of individual items in the costs statement which the Deputy Registrar determined to deal with under item 27. I reiterate my view that, given its natural meaning, item 27 contemplates useful work actually done, and that it is an unwarranted gloss to regard it as simply a "care and consideration" loading - while accepting that this is the item to be relied upon where special features of a case call for a substantial loading of that kind.

[37] Judge McGill's decision was the subject of an unsuccessful application for leave to appeal, McCoombes v. Curragh Queensland Mining Ltd (2001) QCA 379, in which the Court of Appeal state at page 4:-

""Item 27 then provided for a maximum amount to be paid to a solicitor of $3,013 for instructions, for brief to counsel on trial and instructions generally throughout the proceedings, including allowances for all attendances on and correspondence with the plaintiff and witnesses. Mr Hanson correctly submits that there are two methods of approaching an assessment under item 27: either assess a reasonable amount and if that amount exceeds the maximum, allow the maximum; or reserve the maximum for the most complex matters and allow a figure up to the maximum according to the complexity of the matter. Of course, in complex, important, difficult or urgent cases an application can be made for an increase of up to 30 per cent in the sale.

The learned primary judge noted that the item 27 maximum was then too low, referring with apparent approval to the comments of Robin DCJ in Boral Resources (Queensland) Pty Ltd v. Trim. His Honour then adopted the second of the approaches set out above, which was also the approach taken by the Deputy Registrar. His Honour regarded the action as `somewhat complex', determined that an amount approaching the maximum was justified; the $2,000 allowed by the Deputy Registrar was inadequate and his Honour allowed instead $2,800. Interestingly, the plaintiff also appeared to take this approach in asking for item 27 costs of $3,000 rather than the then maximum of $3,013. The approach taken by the learned District Court judge was one which was at least as attractive as the alternative; the matter certainly does not warrant the granting of leave to appeal." (emphasis added)

[38] The Deputy Registrar relied on this decision as confirming the availability of two ways of approaching item 27. She noted the similarity that neither case involved a claim to the maximum allowable under item 27, and the important difference that McCoombes settled on the doorsteps of the court, so that the plaintiff's solicitors had completed all pre-trial steps. On reconsideration the Deputy Registrar conceded that "the plaintiff may be right to submit that too much emphasis can be placed on the quantum of the final assessment figure and that this may detract from the other matters to be considered under rule 707 UCPR, including the nature and complexity of the matter." Thus, more "mature consideration" resulted in an increased allowance on the reconsideration.

[39] I can detect no error of principle which may have caused the Deputy Registrar's discretion to miscarry, I cannot detect any failure to take into account relevant considerations, let alone any reliance on an irrelevant consideration. A useful authority on the width of the taxing officer's discretion, particularly as to quantum of costs, is Australian Coal and Shale Employees' Federation v The Commonwealth [1953] HCA 25; (1953) 94 CLR 621, 627-28. Locally, Thomas J. has applied it in Bain Gasteen & Co's Bill of Costs (1990) 1 Qd. R. 412 (cited by one side) and White J.in Re A Bill of Costs of Crouch & Lyndon (Solicitors) v Lowy Pty Ltd, 30 September 1997 (cited by the other side). Kitto J. at 628-29 adopted the summary of the law by the New South Wales Full Court in Schweppes' Limited v. Archer (1934) 51 WM(NSW) 71:-

"In appeals as to costs, the principles to be applied are these. The Court will always review a decision of a Taxing Officer where it is contended that he has proceeded upon a wrong principle, for the purpose of determining the principle which should be applied; and an error in principle may occur both in determining whether an item should be allowed and in determining how much should be allowed. Where no principle is involved, and the question is, whether the Taxing Officer has correctly exercised a discretion which he possesses and is purporting to exercise, the Court is reluctant to interfere. It has undoubted jurisdiction to review the Taxing Officer's decision even where an exercise of discretion only is involved, and will do so freely on a proper case, using its own knowledge of the circumstances: ....., but it will in general interfere only where the discretion appears not to have been exercised at all, or to have been exercised in a manner which is manifestly wrong; and where the question is one of amount only, will do so only in an extreme case"

[40] No sufficient basis appears for interfering with the Deputy Registrar's decision in this review. Indeed, the rough equivalence of the allowance with the maximum available under item 24 (which it marginally exceeds) tends to show the appropriateness of the allowance.

[41] The Deputy Registrar's reasons are as follows:-

"Plaintiff's Objection 17 - Items 340, 341, 344 to 351

These items relate to (some) costs incurred by the Plaintiff on the assessment.

The Defendants made an offer to settle the Plaintiff's costs in this matter in the sum of $5,500.00. My notes from the assessment hearing indicate the Defendants' offer met the requirements of Rule 721 UCPR.

My notes from the assessment hearing also indicate that it was not made entirely clear to me, by either party, that the offer was made prior to the drawing of the Plaintiff's costs statement.

Given that the Plaintiff has not filed a reply to the Defendants' application, nor have the Defendants alluded to the specific timing of the offer in their reply, for the purposes of these answers, I will have to make the assumption that the offer was made after item 307 of the costs statement, but before item 308, the claim for drawing the costs statement.

To determine whether the offer is successful at this point of the bill, the amount assessed ie. Total allowances less total reductions must be determined, taking into account also the reconsideration process.

Total amount claimed up to and including item 307 = $8,364.50

Less total reductions up to and including item 307 = $2,908.85

Total amount claimed up to and including item 307 = $8,364.50

Less total reductions up to and including item 307 = $2,908.85

After reconsideration the Defendants' offer of $5,500.00 is not successful.

It is noted that on the assessment hearing Rule 722(4) was applicable. However, despite the Defendants' offer being an amount higher than the amount assessed to that point of the bill, I did nevertheless make some allowances to the Plaintiff for costs associated with the assessment process (see Schedule attached).

At the hearing I concluded that by the insertion of the words "unless the registrar otherwise orders" in Rule 722(4), the amount of the costs of assessment for the party who has made the successful offer is within the discretion of the assessing registrar. I also concluded that where an offer is good, the costs of assessment recoverable by the party who lodged the bill is also within the discretion of the assessing registrar. The registrar must take into account all relevant circumstances (Rule 707 UCPR) when exercising the discretion in Rule 722(4).

It is noted that the annotations provided by Mr Graham Robinson of counsel to Rule 722(4) UCPR[2] confirm the proposition that it does not automatically follow that where a successful offer has been made that the party entitled to costs will be automatically ordered to pay the costs of assessment.

At the hearing, submissions were received from the parties with respect to all items after item 307 up to and including item 351. Some reductions were made to certain items claimed by the Plaintiff as costs of the assessment. Further some items were disallowed altogether most particularly, the claims relating to attending on the taxation hearing on 14 & 15 May.

At the hearing, in effect all items after item 334 in the bill were disallowed to the Plaintiff. I further ordered that the Plaintiff pay the assessment fee calculated in the sum of $520.00. No costs of assessment were granted to the Defendants in terms of the items identified at page 2 of the Defendant's application for reconsideration.

There was no set-off of costs in the nature of Rule 734 UCPR as suggested in the Defendants' application for reconsideration.

After reconsideration, it has now been determined that the Defendants' offer to settle is not successful. Rule 722(3) is now relevant.

Rule 722(3) UCPR also allows the assessing registrar to exercise a discretion.

Even though there have been some further allowances to the Plaintiff on reconsideration, I am not prepared to adjust the existing allowances and disallowances made to items after 307 in the bill. Further I am not prepared to make any allowances with respect to the Defendants' costs of assessment in the terms set out in the Defendants' application for reconsideration. However I confirm that the Plaintiff is to pay the taxing fee levied (the sum of which is advised below).

I have dealt with each parties' costs of the assessment in this way because of the following particular reasons:-

s This assessment was not overly complex and the bill could have been settled by the parties well before the hearing.

s The amount of time that elapsed between the directions hearing on 14 March 2001, and the first day of the assessment hearing, 14 May 2001, afforded enough time for the parties to resolve the bill. At the time of the directions hearing the Defendants' notice of objections had been filed and each party had enough material, to determine what issues they were apart on.

s Also the amount of time that elapsed between the actual settlement of the action approximately July 2000, and the filing of the Plaintiff's bill in February 2001, afforded both parties enough time to settle the issue of the Plaintiff's costs, or at the very least narrow the issues.

s It is noted that each party engaged experienced costs assessors to appear at the hearing.

s Even though the original estimate of time for the costs assessment hearing provided by the parties at the directions hearing was one day, the matter proceeded beyond the day and was concluded after some 5½ hours (350 minutes) of hearing. In this regard also, both the costs statement and the notice of objections drawn are prolix in part.

s When one compares the total costs of assessment claimed by the Plaintiff and the costs of assessment identified by the Defendant at page 2 of the application for reconsideration, to the total costs in issue and claimed up to item 307, it would have been more "commercially" practicable to avoid the taxation process altogether.

s On reconsideration, even though the Defendants' offer has now been shown to be less than the amount assessed, the offer made was not totally outlandish and was still a commercial range by hundreds of dollars, not thousands.

Both the Plaintiff and Defendants' applications for reconsideration in relation to the items in the costs statement relating to the costs of the assessment process are disallowed.

SUMMARY & COSTS OF APPLICATIONS FOR RECONSIDERATION:

But for the allowances made to items identified in the above answers, the Plaintiff's application for reconsideration is dismissed.

I have also dealt with the Defendants' application for reconsideration above, which has been wholly unsuccessful and is therefore dismissed.

I am not inclined to make any order in favour of either the Plaintiff or Defendants with respect to costs associated with applying and responding to the reconsiderations filed. I consider this an appropriate situation where each party should bear their own costs with respect to the reconsideration process.

The assessment fee recalculated after the reconsideration is levied in the sum of $544.00 and is payable by the Plaintiff."

[42] The Deputy Registrar was correct in noting the discretion reserved to her by either Rule 722(3) or Rule 722(4), whichever might be applicable. At least in relation to Rule 722(4), the Court of Appeal in McCoombes acknowledged the availability of the discretion:-

"The Deputy Registrar or the reviewing Judge could have reduced the costs order in favour of the defendant to express disapproval of the defendant's conduct in raising an expensive, time-consuming unmeritorious point, but they were not obliged to do so." (paragraph 16).

[43] The Plaintiff's argument acknowledged the strong policy of provisions in the UCPR relating to offers to settle and their concomitant costs sanctions, as acknowledged recently by the Court of Appeal in Cameron v. Nominal Defendant [2000] QCA 137; (2001) 1 QdR 476, especially at 479, but argued:-

"The fact is, the defendant did not make a realistic offer to settle and the plaintiff has been penalised because he did not accept an offer that was less than the amount allowed. There has been no such penalty on the defendants, even though they were not successful on their offer to settle."

[44] Not enough was shown to warrant changing the Deputy Registrar's orders in relation to costs (limited, in the event, to require the plaintiff to pay the assessment fee) on the hearing of this review.

[45] The foregoing observations require further consideration, because it was made to appear after the hearing of the review on 20 February 2002 that the Deputy Registrar had been allowed to proceed on an erroneous view of the facts. Her assumption that the defendants' offer to settle costs was made after item 307 of the costs statement but before item 308 (the claim for drawing the costs statement) is quoted above. Although the plaintiff sought to place blame on the defendants, he and his solicitor were in a position to clarify matters. They failed to do it. The latest date in the costs statement is 15 July 2000, which is attributed to items 308 to 351 inclusive. It was explained that the date is something of a fiction, and that some (at least) of the items attributed to it lay in the future, estimates being given of the costs anticipated in respect of those items. The costs statement had been prepared as a draft, whose form has not changed since, and a copy was sent to the defendants' solicitors under cover of a letter of 31 July 2000. The total amount of costs claimed by the plaintiff was of the order of $10,558.60. The defendants by letter of 17 August 2000 made their offer to settle costs in the sum of $5,500. By Rule 721(2) an offer to settle costs: -

"(b) must be for all of the person's liability for costs to the party to whom it is made."

[46] The Deputy Registrar did assess and allow costs for drawing and engrossing of the costs statement, copying of it to serve and those ancillary matters leading to transmission of the costs statement to the defendants' solicitors, parts of the claims being taxed off. It now seems clear that the sums allowed, specifically in relation to items 308 to 317 inclusive, were accepted as necessary or proper costs for the purposes of Rule 703; they ought to have been taken into account in determining the effect of the offer to settle.

[47] I do not accept Mr Ulrick's argument that, whenever the work was actually done, the drawing and engrossing last mentioned ought to be regarded as part of the filing of the costs statement, which did not occur until the offer to settle had been rejected, necessitating a taxation. I note that there has been some criticism of the costs statement for prolixity, and that much simpler documentation might have been used had a costs assessor been involved. Nothing turns on this, because the defendants raised no objection to the preparation of a "traditional" long form costs statement. It seems clear the parties had attempted to agree costs, but to no avail, so that preparation of a detailed bill for scrutiny by the defendants and others became a sensible course. Locating the offer to settle at the correct point in the costs statement chronology, that is after item 317, as opposed to after item 307, leads to the defendants' offer having to be tested against the outcome arrived at by the Deputy Registrar upon reconsideration (an outcome which survives this review intact) allowing a costs recovery by the plaintiff of $6,518.75, so that the "deficiency" in the offer is not $171, as appeared to the Deputy Registrar, but $1,018.75.

[48] The defendants' offer remains much closer to the outcome than the plaintiff's claim, but it was not suggested any consideration existed such as the 15% rule in UCPR Rule 735 leading to the plaintiff having to be penalised for having claimed too much. It is a strong thing to say that acting "commercially" required the plaintiff to forego an amount of costs exceeding $1,000 measured against the court's final assessment, (but something like $5,000 measured against his claim).

[49] The only order made by the Deputy Registrar in relation to costs of the assessment was one requiring the plaintiff to pay the assessment fee levied by the court, which increased to $544, as recalculated after the reconsideration. That order may be seen as a penalty visited upon the plaintiff for failing to act commercially.

[50] The Deputy Registrar was consistent in respect of professional costs of the parties in attending the assessment. She declined, in the exercise of her discretion, to award professional costs of the assessment to the defendants when the opportunity arose under Rule 722(4). Taking a consistent approach, she declined to award costs to the plaintiff when, after the reconsideration, Rule 722(3) became applicable. In the circumstances, what might have been seen as accidental "balances" less than $200 did not detract from her overall impression that these parties should have resolved the costs issues in the ample time available. The case for the plaintiff's obtaining costs, including the assessment fee (see Rule 722(5)), is now stronger than it appeared before. However, to get to this point, the plaintiff has required indulgences, not only under Rule 742(4) by the court's receiving further evidence and permitting to be raised a ground of objection not raised before the Deputy Registrar, but also in the re-opening of the review. Those indulgences were appropriate, in my opinion, in order to avoid any further proceedings founded on a wrong view of the facts. In my opinion, in the review, the Deputy Registrar's decision should be varied to the extent that the defendants, rather than the plaintiff, should bear the assessment fee charged by the court. I would leave unchanged the Deputy Registrar's determination that, otherwise, there should be no order regarding professional costs of either side in the assessment. Any element of penalty against the plaintiff is, in my view, justified by the Deputy Registrar having been denied sufficient assistance from his side.

[51] So far as the costs of the review are concerned, I think there should be no costs, except that the costs of the first day's hearing, when the plaintiff established no entitlement to relief, should be dealt with by an order that the plaintiff pay the defendants' costs to be assessed. That seems to me a proper compensation to the defendants for having to attend twice.

"HIS HONOUR: The plaintiff complains of the Registrar's disallowance of a claim for correspondence sent to WorkCover, seeking its file in respect of the plaintiff. The letter is said to be a "necessary" one under item 95(3).

The Registrar, or the Deputy Registrar, in her reasons, says she has taken that into account in her allowance of a sum, ultimately $1,050, which is subject to challenge in this application, being item 27(1)(b), as part of "necessary work in relation to preparation for hearing".

There is some artificiality in the defendants' assertion that the item should have been disallowed because it was not correspondence with the plaintiff's witnesses, but rather correspondence with the defendants' witnesses, but my view is that at this stage in the application, the Registrar's justification for not making a separate allowance for the letter ought to be accepted. The appropriateness of the sum claimed was not in contest, had it been properly chargeable as a separate item.

I suppose it remains to be seen whether at the end of the day the $1,050 sum assessed comes to appear inadequate. We seem to have reached the point here that it is intended to cover at least some correspondence.

"HIS HONOUR: The next matter to consider is the drawing and engrossing of what the defendants contend were "luxury" items: the drawing and engrossing of a solicitor's summary of documents obtained from WorkCover said to be some 11 pages and the drawing and engrossing of a summary of an interview held with the plaintiff; the engrossed materials were included in counsel's brief.

HIS HONOUR: Counsel's brief included the 11 pages from WorkCover and the strong likelihood is counsel would peruse those and form his or her own assessment.

The Registrar in rejecting these claims took into account Judge McGill's ruling in Alkina Proprietary Limited v. Lambert & Associates Proprietary Limited, Plaint 1544 of 1992, 15 February 1999, in particular at pages 6 and 7, where his Honour referring to other authority indicated that where such documents were properly included in the brief to counsel they might be allowed.

The Registrar did refer to her allowance of something for such activity in respect of item 27. In those circumstances I do not think the Court ought to interfere on review with this particular item, but as I have already said occasion might arise for revisiting the sums fixed under item 27 when a fuller picture emerges of what that item was intended to cover. I incline to accept Mr Ulrick's description of these particular items as luxuries, not necessities.

[1] This ruling is consistent with the recent decision of Judge McGill DCJ in McCoombes v. Curragh Queensland Mining Limited D59/95 delivered in the District Court at Brisbane on 14 June 2001.

[2] See Butterworths edition "Civil Procedure - Queensland" at page 19,5641.

Workers Compensation Act 1990

Workers' Compensation Act 1990

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Judgment (193 paragraphs)

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