O'Brien v Greater Bendigo City Council; Lea v Fosterville Gold Mine

2 In Mr Lea's case, his claim was settled for $850,000, plus retention of workers' compensation payments of $240,000 and a lump sum payment of $48,000 under s 98C of the Accident Compensation Act 1985 (Vic).

3 Mr O'Brien's claim was settled for $650,000, plus retention of workers' compensation payments of $124,000.

4 In each case, it is agreed that the defendant employer will pay the costs of the proceeding, which include payment of senior and junior counsels' brief fees at trial.

5 The point of dispute between the parties in each case is whether there should be an allowance for a fee to senior and junior counsel for appearances at the judicial mediation, and, if so, the quantum of such a fee.

6 In essence, it is contended on behalf of the defendants that given the proximity of the judicial mediations (held on 1 and 2 February) to the trials - both of which were set down for 3 February 2015 - no allowance should be made for a mediation fee for counsel. The defendants submit that the work done by counsel on the trial encompasses that for the mediation. In other words, to make an allowance for counsel fees for the judicial mediation would amount to duplication or double recovery.

7 On behalf of the plaintiffs, it is argued that counsels 'attendance at judicial mediation was discrete and separate to that of the impending trial - proximity of the judicial mediation to the trial is of no consequence and, accordingly, counsel is entitled to a separate fee.

8 Mr O'Brien issued his proceeding on 14 April 2015; Mr Lea on 20 February 2015.

9 Each case was handled by Arnold Dallas McPherson and was called over on 18 December 2015 in preparation for the Bendigo sittings. At that hearing, I fixed both cases for trial on 2 February 2016, with judicial mediation to occur on 1 or 2 February 2015.

10 Shortly prior to the commencement of the sittings, the parties were advised that I would not commence the first trial until 3 February - after the completion of judicial mediation in all cases set down for the circuit.

11 As I have set out, both cases were mediated by Daly AsJ over the course of 1 and 2 February and were successfully resolved. Absent resolution, the trial in one or other of the cases would have commenced on 3 February.

12 Five common orders were sought by the plaintiffs - all of which were by consent with the respective defendants, other than order four:

1. The defendant pay the plaintiff's costs including reserve costs.
2. Certification for senior counsel at $7,700 for brief fee, 2 hour special conference at $770 and circuit fee at $482.
3. Certification for junior counsel at $3,850 for brief fee, 2 hour special conference at $385 and circuit fee at $482.
4. Certification for senior counsel for judicial mediation at $5,500 and junior counsel at $2,750.
5. Proceeding otherwise dismissed.

13 The principles relating to an award of costs in this Court and to the certification of counsel's fees, have been the subject of discussion on a number of occasions in recent times. In summary:

(a) The Court possesses an overriding discretion in relation to the fixing of an award of costs, including allowances for counsel's fees.[1]

(b) The Costs Court is empowered by the Supreme Court (General Civil Procedure) Rules 2015 (the 'Rules') to fix counsel's fees for attending a hearing or trial as 'subject to the provisions of any applicable scale'.[2]

(c) There is no uniform practice in the Court in relation to certification of counsel's fees. It is open to a judge to refer questions of this nature to the Costs Court in these circumstances.[3] Alternatively, a judge may consider it appropriate to resolve the issue at or around the time of trial.

(d) Some judges certify for two counsel; some certify for two counsel and fix the brief fee. Others prefer to let the Costs Court sort the issue out. It is entirely up to the judge.

(e) The Court's discretion in fixing a fee is to be exercised subject to a number of factors, such as: the complexity of the matter, the extent of the legal practitioner's involvement in the matter, and any specialised knowledge or skills required.

(f) The Supreme Court scale of costs 2015 - 2016 makes provision for counsel's fee for certain types of work.[4] Whilst the scale cannot fetter a judge's discretion in the fixing of costs, it is regarded as a cogent guide to the appropriate allowance.

14 It is appropriate here to set out Appendix A to Chapter 1 of the Rules:

Subject to items 19(j) and 19(k), fees allowed up to a maximum of-

(ii) any other appearance (per half day for time spent in the hearing);

(d) conferences (not occurring on day of hearing) (for each hour);

(h) any other work, not otherwise provided for (for each hour);

(i) circuit fees - based on current allowances as provided for in Schedule 1 to Chapter 1 of the Rules of the County Court;

(j) in allowing a fee to Counsel, the Costs Court shall have regard to the following criteria:

(ii) the other fees and allowances to Counsel in the matter; and

(iii) payments made for interlocutory work where that work has reduced the work which would otherwise have been necessary in relation to the brief; and

(k) where costs are taxed pursuant to an order of the Supreme Court, Counsel's fees in excess of scale are not to be allowed unless the Supreme Court otherwise orders, but in any other case, the Costs Court has discretion to allow fees in excess of scale.

Should an order for costs be made for the brief to counsel to appear at the judicial mediation?

15 For the following reasons I think that the defendants should pay counsel fees for appearance at the judicial mediation.

16 First, the brief to counsel to appear at the judicial mediation constituted a task that was separate to that of an appearance at trial. It required a separate attendance by counsel at Bendigo on a day upon which the trial was not scheduled.

17 Second, had trial counsel not been engaged (due to availability or otherwise) and either separate counsel or the plaintiffs' instructing solicitor appeared at the judicial mediation, then I can see no reason why that counsel or solicitor would not recover a fee for their attendance. In other words, to disallow the claim for a brief fee would be to discriminate against trial counsel.

18 Third, and this is a corollary of the second point, it is in the interests of the efficient administration of justice to encourage, rather than thwart, the attendance of trial counsel at a judicial mediation. This is consistent with the objectives of the Civil Procedure Act 2010 (Vic) (the 'Act') as set out in section 7:

Overarching purpose

(1) The overarching purpose of this Act and the rules of court in relation to civil proceedings is to facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute.

(2) Without limiting how the overarching purpose is achieved, it may be achieved by -

(a) the determination of the proceeding by the court;

(b) agreement between the parties;

(c) any appropriate dispute resolution _process - _

(i) agreed to by the parties; or

(ii) ordered by the court_._[5]

19 In relation to dispute resolution and settlement, the overarching purpose is furthered by the following:

Overarching obligation to cooperate in the conduct of civil proceeding

A person to whom the overarching obligations apply must cooperate with the parties to a civil proceeding and the court in connection with the conduct of that proceeding.[6]

Overarching obligation to use reasonable endeavours to resolve dispute

A person to whom the overarching obligations apply must use reasonable endeavours to resolve a dispute by agreement between the persons in dispute, including, if appropriate, by appropriate dispute resolution, unless -

(a) it is not in the interests of justice to do so; or

(b) the dispute is of such a nature that only judicial determination is appropriate.[7]

Overarching obligation to narrow the issues in dispute

If a person to whom the overarching obligations apply cannot resolve a dispute wholly by agreement, the person must use reasonable endeavours to -

(a) resolve by agreement any issues in dispute which can be resolved in that way; and

(b) narrow the scope of the remaining issues in dispute -

unless -

(c) it is not in the interests of justice to do so; or

(d) the dispute is of such a nature that only judicial determination is appropriate.[8]

20 As can be seen, the Act mandates appropriate dispute resolution. A judicial mediation is part and parcel of that regime. Trial counsel usually has (or, perhaps, should have) a real insight into the issues that will truly determine the outcome of the proceeding. He or she should know the settlement range. To discourage trial counsel's attendance at a judicial mediation by refusing to allow a brief fee for a discrete attendance is contrary to the purpose of the Act.

21 Fourth, the defendants' primary complaint, as I see it, is that much of the work done for the trial is encompassed in the work done in preparation for the judicial mediation. In the words of senior counsel for both defendants, trial counsel has been rewarded a 'full tariff fee' by the terms of Order 2 for the trial brief fee, circuit fee and conference fee.

22 I accept that, to a certain extent, the preparatory work for the judicial mediation would flow through to, and, at times, overlap the work done in the trial brief and vice versa. But that proposition, it seems to me, goes to, and should be taken into account in, the assessment of the quantum of the allowance for the fee for the judicial mediation, rather than the entitlement to a separate fee. I see nothing in that overlap which would preclude an entitlement to a brief fee on the mediation.

23 In summary, I can see no reason or principle which would preclude the making of an order in favour of counsel for a fee on a judicial mediation notwithstanding that it was held the day before the trial. It matters not whether the judicial mediation is heard the day before or a month before, it is a discrete event which creates an entitlement to an order of costs.

What fee should be allowed for counsel for appearance at the judicial mediation?

24 I understand that some judges would not wish to address this issue and would prefer to send the matter to the Costs Court. I informed counsel that I was not of that view. Based on experience both sitting as a judge in this Court and as counsel in matters similar to those the subject of this application (although in the distant past), I think there is little difficulty in fixing this type of fee - particularly as the Supreme Court now provides for a scale of counsel's fees.

25 The starting point is the Supreme Court Scale of Costs contained in Appendix A of the Rules and set out at [14] above. But that does not take the matter very far as there is no specific mention of a fee for appearance at a mediation. However, some guidance comes from the fees allowed for other forms of appearance or work performed on behalf of a client.

26 The maximum fee for a brief on trial is $8,256 for senior counsel and $5,500 for junior counsel (exclusive of GST). The hourly fee for preparation, conferences or opinions or 'any other work not otherwise provided for' is $826 for senior counsel and $551 for junior counsel (exclusive of GST).

27 Senior counsel for the plaintiffs submitted that the appropriate fee was $4,540.80 for senior counsel and $3,028.30 (being the scale allowance, with GST included) for 'any other appearance per half-day for time spent in the hearing'. I do not accept this submission, as it is clear that this part of the scale is directed to hearings, rather than a mediation (judicial or otherwise). Nevertheless, it provides another indicator as to the type of allowance which might be made.

28 In my view, counsel is entitled to be recompensed for the attendance on circuit and the time spent working on the mediation.

29 Any allowance for the appearance at the judicial mediation must take into account the fact that it occurred on circuit and the time put in by counsel to advancing their client's case at the mediation and the resulting negotiations. I was told that in both cases the mediation took about three to four hours (which I assume includes the round table discussion and conferring with the client). On the other side of the ledger, I would not allow any amount for preparation as that forms part of the brief fee. Similarly any other conferences are covered by the trial costs orders.

30 I think that junior counsel fee is appropriately fixed at half that of senior counsel, consistent with the other orders.

31 Doing the best I can, and applying common law intuition to the matters I have mentioned, I think the appropriate allowances are $3,300 for senior counsel and $1,650 for junior counsel. Accordingly, Order 5 in both cases will read as follows:

Certification for senior counsel for judicial mediation at $3,300 and junior counsel at $1,650.

[1] Supreme Court (General Civil Procedure) Rules 2015 r 63.07.

[2] Supreme Court (General Civil Procedure) Rules 2015 r 63.82(1).

[3] See for example Henwood v Nansor Australia Pty Ltd (costs ruling) [2013] VSC 655.

[4] Supreme Court (Chapter I Appendices A and B Amendment) Rules 2015 - Increase in Scale of Costs (Appendices A and B) 2015 to 2015.

[5] Civil Procedure Act 2010 (Vic) s 7 [Emphasis added].

[6] Civil Procedure Act 2010 (Vic) s 20.

[7] Civil Procedure Act 2010 (Vic) s 22 [Emphasis added].

[8] Civil Procedure Act 2010 (Vic), s 23.